Church & Dwight Co. v. SPD Swiss Precision Diagnostics, GMBH, No. 14 Civ. 00585, 2014 WL 2526965 (S.D.N.Y. June 3, 2014)
C&D sued SPD for false advertising over its pregnancy test advertising. The court denied SPD’s motion to dismiss.
The parties compete in the market for home pregnancy test kits. SPD’s “Clearblue Advanced Digital Pregnancy Test with Weeks Estimator” is not just designed to detect pregnancy, but also to estimate the number of weeks that have passed since the user last ovulated. C&D’s basic claim is that the Weeks Estimator can’t be used to estimate the duration of pregnancy. The medical profession doesn’t use ovulation, but (allegedly universally, which comports with what I’ve seen) measures pregnancy from a woman’s last menstrual period (LMP). This occurs about two weeks before ovulation, on average. The court doesn’t explain why this is so important, but my Google search for the product confirmed my intuitions: consumers searching for this product will also get ads for abortion clinics, and the number of weeks LMP is vital both for the medically appropriate forms of abortion and for its availability; a woman misled into thinking she was two weeks less “pregnant” than she is according to the law could be tragically deceived. (I wonder what the reason was that the product wasn’t designed to add two to its estimate.)
SPD allegedly made false representations in various forms of advertising. C&D challenged the product name, along with graphics on the box in which the words “Pregnant 1–2 Weeks,” “Pregnant 2–3 Weeks,” and “Pregnant 3 Weeks” appear. In alleged violation of FDA directives, the indications for use statement (of which more in a bit) doesn’t appear in close proximity to the name, or in similar font size, or in bold font. Thus, the literal message “(or, at the very least, the necessary implication)” of the packaging is that the Weeks Estimator can tell a woman how many weeks she has been pregnant.
|Clearblue package with pregnancy estimates|
There’s also a TV commercial with allegedly the same message:
A woman tells a friend that she is pregnant, to which her friend exclaims “Really?!” The woman holds up two fingers and says “two weeks.” After her friend asks whether she has already seen a doctor, the woman responds “Not yet,” holds up the pregnancy test stick, and says “but I just took this new Clearblue test.” The scene moves to a close up of the test stick, with the Clearblue logo, and a display window with the word “Pregnant” and “1–2 Weeks” immediately below that word. The pregnant woman then is heard to say “It’s like two tests in one!” The scene then changes to a graphic reflecting the three display windows noted above, while an announcer states “the new Clearblue pregnancy test also estimates how many weeks.” At the end of the commercial, the announcer concludes “Weeks Estimator. Only from Clearblue.”
(Here’s the Spanish version.)
SPD’s website, until a recent change, referred to the Weeks Estimator as “the ONLY Pregnancy test that Estimates Weeks” next to a graphic of a test stick with “Pregnant 1–2 weeks” in the display window, with similar statements repeated farther down on the page. The page also said that the Weeks Estimator “estimates the number of weeks,” is “Like 2 Tests in 1,” and notes that 78% of women surveyed believe it is important to know “how far along they are.” The page then said that the Weeks Estimator “estimate[s] how many weeks based on time since ovulation,” which was allegedly deceptive because time since ovulation is not the standard used to measure pregnancy. (But a consumer might not know that!) At the bottom of the page, SPD included the FDA’s indications for use.
Point of purchase displays and retail ads also were allegedly deceptive—each display tray said either “First pregnancy test to estimate weeks” or “How far along are you?” The ads didn’t include the FDA’s indications for use statement or disclose that the product measures time since ovulation. A web ad similarly promised “Clearblue Advanced Digital Pregnancy Test with Weeks Estimator. Is there a baby on board? How far along? Find out!”
Finally, C&D challenged a press release that claimed that the product was “approximately 93 percent accurate in estimating the number of weeks based on time since ovulation,” whereas the package insert says that “Agreement of Weeks Estimator results with clinical findings ranged widely from 45%–99%.”
SPD argued that this was all the FDA’s business. SPD’s product is a Class II device: it doesn’t need advance approval but can be subject to “special controls.” Under § 510(k), SPD submitted a premarket notification seeking approval as substantially equivalent to an existing product; §510(k) clearance doesn’t “in any way denote official approval of the device.”
The FDA issued a Clearance Letter stating that it had “determined that there is a reasonable likelihood that [the Product] will be used for an intended use not identified in the proposed labeling and that such use could cause harm.” The letter required that, in the package insert, the “Weeks Estimator results should not be expressed as ‘weeks pregnant’ and should only be explained as the number of weeks that may have passed since ovulation.” In addition, it required a chart in the package insert explaining that a doctor would date the pregnancy roughly two weeks longer than the Weeks Estimator, because doctors use LMP. The letter required the “indications for use” statement be “prominently displayed in all labeling, including pouch box and carton labels and instructions for use, in close proximity to the trade name, of a similar point size and in bold and shall be conveyed accurately—including any limitations—in all promotional materials.” The statement included:
This test cannot be used to determine the duration of pregnancy or to monitor the progression of pregnancy. Your doctor determines how many weeks pregnant you are based on the first day of your last menstrual period and ultrasound results. This test provides a different estimate that cannot be substituted for a doctor’s determination of gestational age. Only your doctor can provide a reliable estimate of gestational age and only your doctor can monitor pregnancy progression. You should seek qualified prenatal care if you suspect you are pregnant.
|Chart for interpreting "Pregnant 1-2" etc.|
The Clearance Letter finished by noting, among other things, that “FDA’s issuance of a substantial equivalence determination does not mean that FDA has made a determination that your device complies with other requirements of the Act or any Federal statutes and regulations administered by other Federal agencies.”
C&D communicated with the FDA, raising many of the same concerns as those in this lawsuit. Then it decided that it needed to sue.
The court first determined that SPD’s communications with the FDA weren’t subject to judicial notice as public records of agency actions. Instead, they were internal documents that SPD treated as confidential (and tried to preserve as confidential even through this litigation). Their authenticity wasn’t beyond dispute, especially as to minutes of a teleconference prepared by SPD purporting to memorialize the call. “Even the documents embodying communications between SPD and the FDA are subject to interpretation such that discovery may illuminate their meaning.”
The court turned to FDCA preclusion of Lanham Act claims. This isn’t subject to a bright-line rule. When faced with two conflicting federal statutes, courts try to give maximum possible effect to both. Also, the differing aims of the two statutes matter. The Lanham Act aims to “protect commercial interests and prevent unfair competition that arises due to false advertising,” while the FDCA is “generally not focused on the truth or falsity of advertising claims but is instead directed to ensuring that drugs and medical devices are safe, effective, and not misbranded.” Still, the statement in Lexmark that courts have a virtually unflagging obligation to hear and decide cases within their jurisdiction wasn’t dispositive: because of the lack of a private action under the FDCA, there’s a necessary tension with the Lanham Act, and courts therefore limit the substantive scope of Lanham Act claims. This isn’t jurisdictional, or a prudential doctrine, but “an implied statutory limitation to the Lanham Act itself by virtue of its potential conflict, in some situations, with the FDCA.”
The basic rule is that “courts refuse to usurp the FDA’s role in the enforcement of the FDCA and the FDA’s authority under that statute.” That has to be figured out case by case. The FDA’s authority here focuses on avoiding misbranding by providing “adequate directions for use” of a medical device, with respect to its intended use. In this case, the FDA found that there was a reasonable likelihood that the device would be “used for an intended use not identified in the proposed labeling” and therefore imposed limits on how SPD could market the device. It specifically provided that “[p]erformance of the Weeks Estimator should not be displayed” on the box labeling and that users should be directed to the package insert for more information on that point. And then it set forth a number of requirements for the package insert, including not expressing the result as “weeks pregnant” but instead as weeks since ovulation. The FDA also drafted the indications for use, including two paragraphs on the Weeks Estimator feature, and required that they be prominently displayed in all labeling and in all promotional materials.
Given this, SPD’s argument that the claims here involved the FDA’s authority over the marketing of the product was “not wholly without force.” Nonetheless, resolving the complaint didn’t necessarily involve direct application of the FDA’s regulations. The core of the Lanham Act claim was that SPD was falsely marketing the Weeks Estimator as capable of estimating the duration of a pregnancy, but it couldn’t do so because what it measured, time since ovulation, was not pregnancy duration. (The 93% accuracy claim was similar for these purposes.) Thus, though the FDA’s determination that the product doesn’t measure the duration of pregnancy was evidence of falsity, C&D’s claim would exist even if the FDA hadn’t made that determination.
The court’s job, in this interpretation, would then be to determine the message conveyed to consumers, and then determine whether that message was false or misleading. On the current record (which could be supplemented), neither of those determinations required the interpretation, application, or enforcement of the FDCA, the FDA’s regulations, or the Clearance Letter. “C&D’s claim is independent of the FDCA and FDA regulations and would exist even in their absence.” Many courts have considered the FDA’s positions on scientific findings as evidence of falsity.
The mere fact of regulation in an area doesn’t inevitably lead to preclusion. “Indeed, were courts unable to look to agency expertise in this fashion or if the mere fact that an agency had regulatory authority in an area was sufficient to invoke preclusion, the doctrine of primary jurisdiction … would be incoherent.”
Cases finding preclusion were distinguishable—here, there was no need to apply an FDA regulation to determine whether an ad was false. Nor was there an actual conflict between a regulation and the claims. In Pom Wonderful, the rationale was that the FDA scheme provided a basis to conclude that the product name had been authorized by the FDA, but the Clearance Letter was not authorization of the Weeks Estimator’s box, label, or advertising. No similar conflict was apparent from the current record.
The court noted that the Clearance Letter also required many of its disclosures in the package insert, not the box. “[I]t may be that the box—even if approved by the FDA when taken in conjunction with the package insert—is misleading to the consumer at the time of purchase due to the unavailability of the package insert at that time.” This is where the different purposes of the Lanham Act and the FDCA had the greatest bite. “[F]rom the perspective of the FDA, so long as the consumer is adequately informed about the use of the Weeks Estimator post purchase and does not misunderstand its results, the FDA’s safety concerns are addressed.” But that was cold comfort to a competitor, because the clarity would come too late to avoid a deceptively induced purchase.
Although there was potential conflict between the FDA’s views and some hypothetical judgment for C&D given the Clearance Letter’s directive that “[p]erformance of the Weeks Estimator should not be displayed on your box labeling,” that FDA statement was ambiguous, and had to be read in context with the FDA’s concerns about intended use. The statement could mean a directive that SPD remove specific product claims it had made in the proposed labeling, and nothing in the letter demonstrated that the FDA actually approved the box and labeling that SPD put on the market, let alone the other promotional materials. “Viewed in the light most favorable to C & D, the Court cannot view this portion of the Clearance Letter as preemptive approval by the FDA of any advertisement for the Weeks Estimator—no matter how misleading that advertisement may be as to the product’s capabilities—so long as it includes this indications for use statement.”
As you might expect, the court also rejected SPD’s primary jurisdiction argument. Primary jurisdiction involves deferral, not dismissal, giving an agency the first bite at the apple. But the FDA has already “provided its views as to the principal scientific question that this Court might refer to it: whether the Weeks Estimator can measure the duration of pregnancy based on the last menstrual cycle.” Its answer is no. And the FDA has even provided its opinion on whether a measure of pregnancy based on date of ovulation is the standard most commonly applied by physicians. Also no. The court’s task was to evaluate potential consumer confusion from the product’s marketing, which is within a court’s core competence. “The Court has the agency’s answer on the primary matter for which its technical expertise may be invoked, strongly suggesting primary jurisdiction is not applicable.” The §510(k) process was apparently over; there was no need to wait for more. There was little danger of an agency ruling inconsistent with a court judgment. While C&D made an informal application to the FDA requesting review of SPD’s compliance with the Clearance Letter, the FDA hadn’t indicated that it would take action or provided a timeline. On this record, primary jurisdiction didn’t justify delay.
The parallel state law claims also survived.
Given that Pom Wonderful might change things, and that C&D was willing to fold injunctive relief into the merits process, the court determined that it would await the opinion in that case before making any further determination.