putative falsity about medical test not material to labs, but maybe to doctors

Quidel Corp. v. Siemens Medical Solutions USA, Inc., No. 16-cv-3059-BAS-AGS, 2019 WL 5320390 (S.D. Cal. Oct. 21, 2019)

A pair of opinions shows the importance of (1) defining the market and (2) being able to show materiality.

The parties compete in the market for assays (blood tests) used for measuring thyroid stimulating immunoglobins, which can aid in the detection of Graves’ disease. There are two relevant types of assays: (1) TSH receptor antibody (TRAb) assays, which detect both stimulating and blocking thyroid immunoglobins (TSI and TBI) and (2) TSI only assays.  Quidel entered the market first with Thyretain, advertised as a “TSI only” assay that produces a positive (qualitative) result if TSI is detected. Siemens entered with Immulite, using Thyretain as the predicate device for their 510(k) application to the FDA.

While Thyretain is a bioassay, Immulite is an immunoassay that Siemens says may be measured “in a ‘semi-quantitative’ manner, depicting the concentration of TSI in a sample, rather than just a binary ‘qualitative’ result.”

Quidel argued that, as an immunoassay, Immulite didn’t distinguish between stimulating or blocking antibodies, and thus detects TBI as well as TSI. After Quidel’s protest, Siemens dropped the “TSI only” claim, but Quidel argued it suffered damages: out of four US laboratories, two switched to Immulite.

The court found that “TSI only” was not ambiguous, especially in context and given the advertising targeted to sophisticated consumers. Siemens argued that it wasn’t false because its statements were always made in conjunction with a claim of 98% specificity (where the remaining 2% apparently might come from detecting TBI). Given conflicting expert testimony over whether Immulite actually detected TSI only, there was a question of fact.

However, there was no question of fact on materiality to laboratories. The evidence showed that the two labs that switched didn’t rely on Siemens’s advertising.  A representative for one lab testified that the decision about whether or not to adopt the new assay “involved months of discussion and deliberation,” including “a review of the relevant literature” and “a validation study” after FDA approval. Ultimately, the lab concluded that Immulite “was a superior assay for use in the laboratory.” The witness testified that he didn’t remember any press releases or statements on Siemens’s website; his lab “is not guided by manufactures’ sales and marketing collaterals on a website.”  The other lab rep testified similarly. He testified that he understands that when vendors give him papers regarding the product, “they’re likely to provide [him] only papers that are positive for their test.” He found this lawsuit to be “frivolous” and “personally offensive” because it assumes that his lab doesn’t “do a very, very rigorous job of vetting our assays and that we can be swayed by marketing.” Based on this testimony, the court found that it wasn’t enough to show that the labs reviewed the allegedly false statements; that didn’t show that the statements “had any material impact on their decision-making process.”

The fact that the labs now believed that Immulite detects TSI only (and advertised same on their own websites) didn’t mean that the false advertising drove that belief, which could have come from internal testing. Nor did the fact that TSI-only capability was an inherent/core chracteristic of the product make it material given the other evidence. “No matter what the false advertising pertains to, if the customer is not likely to be influenced by the statement, it is not material.”

Matters were different with respect to doctors. A jury could find that doctors were relevant purchasers; there was evidence on both sides. Siemens’s employee testified that it previously contracted a marketing agency to conduct a marketing campaign aimed at clinicians because “it’s really important to educate the physicians...[b]ecause if they don’t order the test, then there’s...no point of having it in the laboratory.” A lab director also testified that the clinicians are “substantially” in charge of deciding which type of assay to run. testified the clinicians “have the capability of and ask for [the assay] by name...and in some circumstances they will specify.” And a Siemens representative received an email from a doctor who asked if IMMULITE “is specific to TSI or if it potentially can detect TBI’s directed towards the N-terminal part of the thyroid receptor.” “This shows the physicians are aware of the details of the test, and therefore may be interested in how the product is marketed.”  However, a different Quidel expert stated that at her institution, “when a TSI is ordered [by a clinician], there is no indication on the report of which assay (Roche, Thyretain, Immulite, etc.) was utilized” and the physician only receives the results from the test, i.e. the measurement of TSI.

The court also partially rejected Siemens’s unclean hands defense.  That Quidel was allegedly billing the tests wrongly was unrelated to the misconduct here now that the labs were out of the case. However, that Quidel’s Thyretain also allegedly detected TBI and that the presence of TBI could “interfere with Thyretain’s measurement of TSI, and result in a false ‘negative’ reading” was related, and there was a genuine issue of material fact on the question. Even if the misconduct occurred and was related, it had to be balanced against the wrong at issue, which couldn’t be done at this stage of the case.

Quidel Corp. v. Siemens Medical Solutions USA, Inc., No. 16-cv-3059-BAS-AGS, 2019 WL 5328730 (S.D. Cal. Oct. 21, 2019)

Here, the court denies Siemens’s motion to exclude plaintiff’s survey expert’s report/testimony. Mr. Ezell surveyed “physicians that specialize in endocrinology and who, as part of their practice, order assay tests to assist in patient diagnosis.” He showed test and control materials:

They were asked screening questions and then about whether Immulite does or doesn’t detect TSI only, in both closed- and open-ended questions. They were then asked whether they were likely to order both a TSI only and TRAb assay, and why. The expert concluded that approximately 67.42% of the relevant universe was likely to be misled or deceived by the message that IMMULITE is a TSI assay, detects TSI only, or is not a TRAb assay (assuming, as he should given his role in the litigation, that these statements are false).

As noted above, doctors could be relevant purchasers. “This is not a situation where all physicians blindly use whatever assay the laboratory happens to carry, with no input into what assay they use on patients. Given the conflicting testimony, it is possible the physicians’ opinions regarding the products are relevant and their opinions could be influenced by marketing or website information.”

Criticisms of the questions as ambiguous also failed—it was for the jury to decide whether it was troubling that Ezell used the terms “TSI only” and “TRAb assay” in the survey without defining the terms. So too for whether the questions led and biased the respondents, which goes weight rather than admissibility. “Surveys can be admitted even if they contain ‘highly suggestive’ questions, as long as the survey is ‘conducted according to accepted principles and [is] relevant.’”  Nor was the control group excerpt biased because it used “gratuitous language.” The differences between test and control stimulus were “not so great that they predetermined the result of the survey,” and this argument was for the jury.  (To me, very much a nonexpert, the control statement seems self-contradictory: a test that does not differentiate, but nonetheless detects TSI only at 98.5% specificity?)  Nor did it matter that counsel drafted the control statement; Ezell reviewed it and agreed it was appropriate. That differs from surveys “entirely designed and conducted by counsel ‘who is not qualified to design or interpret surveys.’” (Citing McCarthy: “Attorney cooperation with the survey professional in designing the survey is essential to produce relevant and usable data.”).  Disputes over whether control group answers were properly coded as not confused, allegedly resulting in nearly 25% confusion in the control group, were also for the jury.