Court Opinion

ID: 3173983
Source: CourtListenerOpinion
Date Created: 2016-02-05 08:28:40.973589+00
Date Added: 2024-06-11T07:38:41.391448
License: Public Domain

NONPRECEDENTIAL DISPOSITION
                To be cited only in accordance with Fed. R. App. P. 32.1

                United States Court of Appeals
                                 For the Seventh Circuit
                                 Chicago, Illinois 60604

                                Argued January 26, 2016
                                Decided February 3, 2016

                                         Before

                           DIANE P. WOOD, Chief Judge

                           WILLIAM J. BAUER, Circuit Judge

                           RICHARD A. POSNER, Circuit Judge

No. 15-2411

MICHAEL HOUSTON,                                  Appeal from the United States District
    Plaintiff-Appellant,                          Court for the Northern District of Illinois,
                                                  Eastern Division.
      v.
                                                  No. 14 C 1042
UNITED STATES OF AMERICA, et al.,
     Defendants-Appellees.                        Jorge Alonso,
                                                      Judge.

                                         ORDER

        Michael Houston is permanently disfigured as a result of a severe skin reaction
called Stevens-Johnson Syndrome (SJS), which he developed after taking allopurinol, a
prescription drug used to treat gout. Houston brought tort claims in state court against
the federally funded health clinic where he was treated for gout, the physician’s assistant
who prescribed allopurinol, and the drug manufacturer. The United States removed the
case to federal court and substituted itself as the defendant in place of the federal
healthcare providers, as the Federal Tort Claims Act provides. See 28 U.S.C. § 2679. The
United States then moved to dismiss Houston’s claims against the United States for
failing to exhaust his administrative remedies. See 28 U.S.C. § 2675(a). The drug
manufacturer moved to dismiss, too, arguing that all of Houston’s state-tort claims
No. 15-2411                                                                         Page 2

against it are preempted by federal drug regulations. The district court granted the
defendants’ motions and dismissed the case with prejudice. Because the defects in
Houston’s amended complaint cannot be cured, we affirm.

       Houston visited the Komed Holman Health Center in July 2011 for pain in his
right toe. James Pecard, a physician’s assistant, diagnosed Houston with gout and
prescribed allopurinol. (Allopurinol is a generic form of Zyloprim and is used to treat
gout by reducing uric acid in the body.) Pecard allegedly did not warn Houston that
taking allopurinol risks SJS, blindness, and even death. One month later, Houston went
to an emergency room because of severe eye pain, red eyes, and a small rash on his face.
He was prescribed eye medication and sent home but returned two days later with
persistent eye pain and a severe rash that had spread across his body. Houston was
diagnosed with SJS and admitted to the intensive care burn unit, where doctors
concluded that the allopurinol had triggered his SJS.1

       Houston brought a complaint in Illinois court. He alleged medical malpractice
claims against Pecard, the health clinic Komed and its parent company, and an unnamed
doctor who allegedly failed to supervise Pecard (together, “the healthcare defendants”).

       1 According to the Mayo Clinic, SJS is a serious skin disorder. Stevens-Johnson
Syndrome: Treatments and Drugs, MAYO CLINIC (Apr. 22, 2014),
http://www.mayoclinic.org/diseases-conditions/stevens-johnson-syndrome/basics/treat
ment/con-20029623. If treated properly the syndrome can be eliminated within a few
days of hospitalization, but severe cases may last several months. Id. SJS typically starts
with flu or fever-like symptoms, and after a few days the skin begins to peel or blister,
causing painful raw areas known as erosions that resemble severe hot water burns.
Stevens-Johnson Syndrome/Toxic Epidermal Necrolysis, NAT’L INSTS. OF HEALTH,
http://ghr.nlm.nih.gov/condition/stevens-johnson-syndrome-toxic-epidermal-necrolysis
(reviewed July 2015). Those erosions usually start on the face and chest and then spread
to the rest of the body. Id. For most people SJS damages the mucous membranes,
including the lining of the mouth and airways, making it difficult to breathe and
swallow. Id. Painful blistering can also occur in the urinary tract and genitals. Id. SJS
often affects eyes, as well, causing redness in the mucous membranes that protect the
white parts of the eye, and damaging the cornea. Id. SJS is a potentially life-threatening
disease, with one in ten cases resulting in death. Id. Long-term side effects may include
changes in skin coloring, dry skin and mucous membranes, excess sweating, hair loss,
abnormal growth or loss of fingernails and toenails, impaired taste, difficulty urinating,
and genital abnormalities. Id.
No. 15-2411                                                                        Page 3

He also brought product-liability claims against the manufacturer of allopurinol,
Qualitest Pharmaceuticals, for failing to warn about or better design the drug. He sought
damages for mental and physical suffering associated with the skin disease. Houston
states that he has incurred permanent physical injuries and disfigurement from SJS.

       The United States removed the case to federal court, see 28 U.S.C. § 2679, and
substituted itself for the healthcare defendants. The government certified that “at the
relevant times” Komed was a federally funded entity, Pecard acted “within the scope of
his employment” at Komed, and the healthcare defendants are therefore federal
employees under the Public Health Service Act, 42 U.S.C. § 233. See 28 U.S.C. § 2679(d).
Under the FTCA, it continued, federal employees are immune from tort claims arising
from conduct within the scope of their jobs; claims against them are deemed actions
against the United States only. See 28 U.S.C. § 2679.

        Houston contested the government’s certification that Pecard acted within the
scope of his employment. After the court allowed Houston limited discovery on that
issue, Houston amended his complaint. He asserted that Pecard acted outside the scope
of his job at Komed because he, “at all times relevant … a physician’s assistant,”
prescribed allopurinol without warning of its side effects or getting the signature of his
supervising physician at Komed. Houston identified that supervising doctor as Syeda
Shariff, adding that “at all times relevant” she worked at Komed.

        The defendants moved to dismiss. The United States argued that Houston did not
allege facts supporting the claim that Pecard and Shariff were acting outside the scope of
their employment and thus not covered by the FTCA. Houston’s claims, therefore, were
against the United States and should be dismissed as unexhausted under the FTCA
because he never filed an administrative claim. See 28 U.S.C. § 2675(a). Qualitest also
moved to dismiss. It argued that under the Supreme Court’s recent decisions in Mutual
Pharmaceutical Co., Inc. v. Bartlett, 133 S. Ct. 2466 (2013), and PLIVA, Inc. v. Mensing,
131 S. Ct. 2567 (2011), all of Houston’s state-law claims are preempted by federal laws
that regulate generic-drug manufacturers.

        The district court granted the motions. It agreed with Qualitest that the product
liability claims are preempted. The court explained that federal drug regulations impose
a duty of “sameness” on generic drug manufacturers to ensure that the generic versions
of drugs have the same active ingredients, route of administration, dosage form,
strength, and labeling as the brand name drug. See Bartlett, 133 S. Ct. at 2475; Mensing,
131 S. Ct. at 2576. It would be impossible, the court reasoned, for the company to comply
No. 15-2411                                                                             Page 4

with a state-law duty to change the label or design of allopurinol while complying with
its federal duty to keep the label and design the same. The court also ruled that, because
the acts attributed to the healthcare defendants occurred within the scope of federal
employment, the claims against them were deemed against the United States and must
be dismissed as unexhausted.

       The case ended there. Although the court did not enter the judgment on a
separate document, Houston’s appeal is timely because he filed it within 150 days after
the court’s final decision. See FED. R. CIV. P. 58(c)(2)(B); Brown v. Fifth Third Bank, 730 F.3d
698, 699–700 (7th Cir. 2013).

        Turning first to the healthcare defendants, Houston argues that the district court
erred in concluding that Pecard and Shariff acted within the scope of their employment;
therefore it should not have deemed the claims against them to be against the United
States and dismissed those claims as unexhausted. He relies on cases stating that a state
employee is not shielded from tort liability under Illinois law if the employee’s duty to
the plaintiff arises outside of the employment context. See, e.g., Currie v. Lao, 592 N.E.2d
977, 980–81 (Ill. 1992); Janes v. Albergo, 626 N.E.2d 1127, 1133 (Ill. App. Ct. 1993). But the
FTCA immunizes federal employees who act within the scope of their employment,
regardless of the source of the employee’s duty to the plaintiff. See 28 U.S.C. § 2679(b)(1);
Osborn v. Haley, 549 U.S. 225, 229 (2007). Pecard’s and Shariff’s duties to Houston may
arise from the doctor–patient relationship rather than their employment with Komed.
But they are nonetheless shielded from liability under the FTCA as long as they were
acting within the scope of their employment at Komed. Id.

        The question, then, is whether Houston has alleged facts to support his claim that
Pecard and Shariff acted outside the scope of their employment. See Taboas v. Mlynczak,
149 F.3d 576, 582 (7th Cir. 1998). Under Illinois law, which the parties agree governs,
“[a]n employee’s action falls within the scope of employment if (a) it is of the kind he is
employed to perform; (b) it occurs substantially within the authorized time and space
limits; [and] (c) it is actuated, at least in part, by a purpose to serve the master.” Id.
(quoting Pyne v. Witmer, 543 N.E.2d 1304, 1308 (Ill. 1989)) (internal quotation marks
omitted). When the court, as here, dismisses a complaint based on the government’s
certification that its employees acted within the scope of employment, the plaintiff must
point to facts suggesting that, based on this scope-of-employment formula, the
certification is wrong. Taboas, 149 F.3d at 582.
No. 15-2411                                                                           Page 5

       Houston’s factual allegations suggest that Pecard and Shariff acted within the
scope of their work. He alleges that “at all times” Pecard was a physician’s assistant at
Komed. A physician’s assistant may prescribe drugs once a supervising physician has
delegated that power to the assistant. See 720 ILCS 570/303.05(a)(1). Having received
discovery on the matter, Houston needed to allege (if it was true) that no supervising
physician at Komed delegated prescribing power to Pecard. But he has not. Likewise
Houston also alleges that Shariff was “at all times” Pecard’s supervisor at Komed. But he
does not allege that she (or Pecard) acted after work hours or offsite or that they were
motivated by personal reasons rather than on behalf of the health center. Thus no factual
allegations suggest that they acted outside the scope of their work.

        Houston offers two unavailing replies. First, he argues that, because Pecard
negligently prescribed him allopurinol without warning him of possible side effects and
Shariff negligently failed to supervise Pecard or sign the prescription, they exceeded
their job authority. But an allegation of negligence is not enough to remove actions from
the scope of employment. See Sellers v. Rudert, 918 N.E.2d 586, 591–92 (Ill. App. Ct. 2009).
Second, Houston argues that Pecard and Shariff cannot be deemed federal employees
because, as medical professionals, they exercise judgment. But the use of judgment is
irrelevant to federal employment status. See, e.g., Arteaga v. United States, 711 F.3d 828,
830–31, 835 (7th Cir. 2013); Alexander v. Mount Sinai Hosp. Med. Ctr., 484 F.3d 889, 891 (7th
Cir. 2007). Therefore, because they acted as employees of Komed, the United States was
the proper defendant under the FTCA. And because Houston does not dispute his
failure to exhaust, the district court correctly dismissed the claims against the
government. See 28 U.S.C. § 2675(a); McNeil v. United States, 508 U.S. 106, 113 (1993);
Smoke Shop, LLC v. United States, 761 F.3d 779, 786–88 (7th Cir. 2014).

       As for his claims against Qualitest, Houston argues first that, once the United
States was dismissed, those claims should have been remanded to state court because
they do not fall within the district court’s original or supplemental jurisdiction. See 28
U.S.C. § 1441(c). But the claims against Qualitest are part of the “same case or
controversy” as the claims against the United States—that Houston developed SJS after
taking allopurinol—and thus the claims fall within the court’s supplemental jurisdiction.
McCoy v. Iberdola Renewables, Inc., 760 F.3d 674, 682–83 (7th Cir. 2014) (quoting United
Mine Workers v. Gibbs, 383 U.S. 715, 725 (1966)); see 28 U.S.C. § 1367(a). Moreover, the
parties are diverse (Houston is a citizen of Illinois and Qualitest is a citizen of Delaware
and Alabama); and although Houston did not quantify his damages, based on the
severity of SJS the amount in controversy likely exceeds $75,000.
No. 15-2411                                                                               Page 6

        Houston next argues that the district court wrongly dismissed his state-law
claims against Qualitest as preempted by federal law. He is incorrect. Federal law
imposes on Qualitest an “ongoing duty of sameness” to ensure that allopurinol’s
chemical design and labeling are the same as its brand-name counterpart, Zyloprim.
See 21 U.S.C. § 355(j)(2)(A)(ii)–(v); Mensing, 131 S. Ct. 2575. The duty preempts a
state-law claim against a generic manufacturer if, as here, that claim would require the
manufacturer to redesign its drug, change its labeling, or exit the market in order to
avoid liability. See Bartlett, 133 S. Ct. at 2474–77; Mensing, 131 S. Ct. at 2578, 2581; see also
Brinkley v. Pfizer, Inc., 772 F.3d 1133, 1139 (8th Cir. 2014); Drager v. PLIVA USA, Inc., 741
F.3d 470, 476 (4th Cir. 2014).

       Houston offers three replies, none persuasive. First he argues that his state-law
claims do not necessarily require Qualitest to change allopurinol’s design or label. But
this argument is self-defeating because his suit alleges that under state law Qualitest
should have labeled or designed the drug differently. Without a different label or design,
the only way that Qualitest could avoid liability would be to exit (or never have entered)
the generic market. But generic-drug makers benefit consumers when they bring
FDA-approved drugs to market. For that reason, market exit is precisely the outcome
that the duty of sameness and Mensing’s preemption principle are designed to prevent.
Mensing, 131 S. Ct. at 2578.

        For the same reason, Houston’s claims for defective design, negligence, consumer
fraud, battery, and breach of express and implied warranties are also preempted.
See, e.g., Brinkley, 772 F.3d at 1140–41 (design-defect and implied-warranty claims);
Johnson v. Teva Pharm. USA, Inc., 758 F.3d 605, 612–13 (5th Cir. 2014) (design-defect and
express-warranty claims); Eckhardt v. Qualitest Pharm., Inc., 751 F.3d 674, 678–80 (5th Cir.
2014) (same); In re Fosamax (Alendronate Sodium) Prods. Liab. Litig. (No. II), 751 F.3d 150,
165 (3d Cir. 2014) (strict-liability design-defect claim); Drager, 741 F.3d at 476–79 (claims
for negligence, design defect, breach of implied and express warranties, negligent
misrepresentation and fraudulent concealment); Strayhorn v. Wyeth Pharm., Inc., 737 F.3d
378, 394–97 (6th Cir. 2013) (claims for breach of implied warranty, fraud and
misrepresentation, and design defect); Schrock v. Wyeth, Inc., 727 F.3d 1273, 1286–89 (10th
Cir. 2013) (claims for breach of express and implied warranties).

       Second, Houston argues that his claims should survive preemption under the
Supreme Court’s decisions in Altria Group, Inc. v. Good, 555 U.S. 70 (2008), Bates v. Dow
Agrosciences, LLC, 544 U.S. 431 (2005), and Cipollone v. Liggett Group, Inc., 505 U.S. 504
(1992). But the claims in those cases, which accused cigarette and pesticide makers of
No. 15-2411                                                                             Page 7

deceptive advertising, did not require manufacturers to violate any federal duty.
See Altria Group, 555 U.S. at 87; Bates, 544 U.S. at 446, 452; Cipollone, 505 U.S. at 530–31. By
contrast, Houston’s claims do.

       Third, Houston argues that Mensing and Bartlett do not apply here because his
claims arose after the passage of the Food and Drug Administration Amendments Act of
2007, Pub. L. No. 110-85, 121 Stat. 823 (2007). Those amendments, he explains, give the
FDA authority to negotiate changes in drug labeling with generic-drug manufacturers.
Although the Supreme Court reserved ruling on the effect of that legislation, Mensing,
131 S. Ct. at 2574 n.1, the amendments still forbid a generic-drug maker from violating
the duty of sameness without FDA permission. See generally Pub. L. No. 110-85, 121 Stat.
823 (2007); see also Mensing, 131 S. Ct. at 2581 (“[W]hen a party cannot satisfy its state
duties without the Federal Government’s special permission and assistance, which is
dependent on the exercise of judgment by a federal agency, that party cannot
independently satisfy those state duties for pre-emption purposes.”). And nothing in the
amendments or other laws requires a manufacturer to seek that permission, the receipt of
which would be speculative anyway.

        Two loose ends remain. Houston challenges the denial of his request to add
claims against a new party, the manufacturer of the brand-name version of allopurinol,
Zyloprim. This court has not addressed whether a consumer of a generic drug may sue
the brand-name manufacturer, though others have. Compare Dolin v. Smithkline Beecham
Corp., 62 F. Supp. 3d 705, 720–21 (N.D. Ill. 2014) (allowing generic consumer to pursue
negligence claim against brand-name manufacturer), with Smith v. Wyeth, Inc., 657 F.3d
420, 423–24 (6th Cir. 2011) (brand-name manufacturers owe no duty to generic
consumers), and Foster v. Am. Home Prods. Corp., 29 F.3d 165, 170–71 (4th Cir. 1994). We
need not takes sides. Even if Houston could otherwise pursue a claim against the
brand-name manufacturer, the two-year statute of limitations for personal-injury claims
in Illinois has already run, see 735 ILCS 5/13-202, and the brand-name manufacturer did
not receive notice of this suit within the time that would allow any amendment to relate
back to the date of the original complaint, see FED. R. CIV. P. 4(m), 15(c)(1)(C).

        Finally, Qualitest moved this court to take judicial notice of information on the
FDA’s website. Qualitest says the information shows that the FDA approved allopurinol
to treat gout, that allopurinol and Zyloprim have the same active ingredients, route of
administration, dosage form and effect, and labeling, and that the labels for both
products include the same warnings about SJS. This court may take judicial notice of any
fact that “can be accurately and readily determined from sources whose accuracy cannot
No. 15-2411                                                                         Page 8

reasonably be questioned,” FED. R. EVID. 201(b)(2), including public records, Henson v.
CSC Credit Servs., 29 F.3d 280, 284 (7th Cir. 1994), and agency determinations, Fornalik v.
Perryman, 223 F.3d 523, 529 (7th Cir. 2000). Although information on the FDA’s official
website reflects the agency’s determinations, the information is unnecessary to resolve
this appeal and thus the motion is DENIED.

       Therefore we AFFIRM the judgment of the district court.