Amanda Watts v. Medicis Pharmaceutical Corporation

IN THE
SUPREME COURT OF THE STATE OF ARIZONA
AMANDA WATTS, AN ADULT INDIVIDUAL,
Plaintiff/Appellant,
v.
MEDICIS PHARMACEUTICAL CORPORATION, AN ARIZONA CORPORATION,
Defendant/Appellee.
No. CV-15-0065-PR
Filed January 21, 2016
Appeal from the Superior Court in Maricopa County
The Honorable Lisa Daniel Flores, Judge
No. CV2012-008081
REVERSED
Opinion of the Court of Appeals, Division One
236 Ariz. 511, 342 P.3d 847 (App. 2015)
AFFIRMED IN PART; VACATED IN PART
COUNSEL:
Mick Levin (argued), Michael D. Malin, Mick Levin, P.L.C., Phoenix,
Attorneys for Amanda Watts
Donald L. Myles, Jr., Lori L. Voepel (argued), Joshua M. Snell, Jones, Skelton
& Hochuli, P.L.C., Phoenix, Attorneys for Medicis Pharmaceutical
Corporation
Mark Brnovich, Arizona Attorney General, John R. Lopez IV, Solicitor
General, David W. Garbarino, Stephen J. Emedi, Assistant Attorneys
General, Phoenix, Attorneys for Amicus Curiae State of Arizona
WATTS V. MEDICIS PHARMACEUTICAL CORP.
Opinion of the Court
Stanley G. Feldman, Haralson, Miller, Pitt, Feldman & McAnally, P.L.C.,
Tucson; and David L. Abney, Dana R. Roberts, Knapp & Roberts, P.C.,
Scottsdale, Attorneys for Amicus Curiae Arizona Association for
Justice/Arizona Trial Lawyers Association
Wayne D. Struble, Bowman and Brooke LLP, Phoenix, Attorney for Amicus
Curiae The Product Liability Advisory Council, Inc.
Alan Blankenheimer, Covington & Burling LLP, Los Angeles, CA; Michael
X. Imbroscio (argued), Paul W. Schmidt, Covington & Burling LLP,
Washington, D.C., Attorneys for Amicus Curiae The Pharmaceutical
Research and Manufacturers of America, the U.S. Chamber of Commerce,
the U.S. Chamber Litigation Center, the Arizona Chamber of Commerce &
Industry, and the Arizona Manufacturers Council
VICE CHIEF JUSTICE PELANDER authored the opinion of the Court, in
which CHIEF JUSTICE BALES and JUSTICES BRUTINEL, TIMMER, and
BERCH (RETIRED) joined.
VICE CHIEF JUSTICE PELANDER, opinion of the Court:
¶1 Under the learned intermediary doctrine (“LID”), a
manufacturer satisfies its duty to warn end users by giving appropriate
warnings to the specialized class of persons who may prescribe or
administer the product. We hold today that the LID generally applies to a
prescription drug manufacturer. We further conclude that the LID is not
displaced by the Uniform Contribution Among Tortfeasors Act
(“UCATA”), A.R.S. §§ 12-2501 through -2509. Finally, we hold that
prescription drugs are “merchandise” for purposes of the Consumer Fraud
Act (“CFA”), A.R.S. §§ 44-1521 through -1534, and the CFA does not require
a direct merchant-consumer transaction to support a patient’s statutory
claim against a drug manufacturer.
I.
¶2 Because the superior court dismissed the plaintiff’s complaint
under Arizona Rule of Civil Procedure 12(b)(6), we “look only to the
pleading itself” and consider its well-pleaded factual allegations,
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Opinion of the Court
reasonable inferences from the alleged facts, and the complaint’s exhibits.
Cullen v. Auto–Owners Ins. Co., 218 Ariz. 417, 419 ¶ 7, 189 P.3d 344, 346
(2008); see Coleman v. City of Mesa, 230 Ariz. 352, 356 ¶ 9, 284 P.3d 863, 867
(2012).
¶3 Medicis Pharmaceutical Corporation manufactures and
distributes Solodyn, which contains minocycline. In its full prescribing
informational materials for Solodyn, Medicis warns: “The long-term use of
minocycline in the treatment of acne has been associated with drug-induced
lupus-like syndrome, autoimmune hepatitis and vasculitis.” Those
materials also state: “Autoimmune syndromes, including drug-induced
lupus-like syndrome, autoimmune hepatitis, vasculitis and serum sickness
have been observed with tetracycline-class drugs, including minocycline.
Symptoms may be manifested by arthralgia, fever, rash and malaise.
Patients who experience such symptoms should be cautioned to stop the
drug immediately and seek medical help.”
¶4 In April 2008, Amanda Watts, then a minor, sought medical
treatment for acne and received a prescription for Solodyn from her medical
provider. Watts apparently did not receive the full prescribing information
noted above, but did receive two other publications about the drug. The
first was a “MediSAVE” card, which her medical provider gave to her, that
outlined a discount-purchasing program for Solodyn. The MediSAVE card
and its accompanying information stated that “[t]he safety of using
[Solodyn] longer than 12 weeks has not been studied and is not known.”
Second, Watts received an informational insert about Solodyn from her
pharmacist. The insert warned that patients should consult a doctor if
symptoms did not improve within twelve weeks. Watts used Solodyn as
prescribed for twenty weeks.
¶5 About two years later, Watts received another prescription for
Solodyn and took it as directed for another twenty weeks. In October 2010,
Watts was hospitalized and diagnosed with drug-induced lupus and
hepatitis, both allegedly side effects from using Solodyn. Although she has
recovered from the hepatitis, doctors expect her to have lupus for the rest
of her life.
¶6 Watts sued Medicis alleging consumer fraud and product
liability, seeking both compensatory and punitive damages. In her
statutory CFA claim, Watts alleged that in connection with the sale or
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Opinion of the Court
advertisement of Solodyn, Medicis knowingly misrepresented and omitted
material facts on the MediSAVE card she received and on which she relied.
She also alleged that the drug was defective and unreasonably dangerous
because Medicis failed to adequately warn her of the consequences of its
long-term use. The superior court granted Medicis’s motion to dismiss.
¶7 The court of appeals vacated the judgment of dismissal and
remanded the case for further proceedings. Watts v. Medicis Pharm. Corp.,
236 Ariz. 511, 513 ¶ 1, 342 P.3d 847, 849 (App. 2015). The court concluded
that the LID “is inconsistent with UCATA” and “cannot coexist with” that
Act. Id. at 518 ¶ 35, 519 ¶ 38, 342 P.3d at 854, 855. Noting “the realities of
modern-day pharmaceutical marketing,” the court of appeals also found
the policy rationale for the LID is “not persuasive now.” Id. at 519 ¶ 37, 520
¶ 41, 342 P.3d at 855, 856.
¶8 We granted review because the legal issues are of statewide
importance and likely to recur. We have jurisdiction under article 6, section
5(3) of the Arizona Constitution and A.R.S. § 12-120.24.
II.
¶9 We review dismissal of claims under Rule 12(b)(6) de novo.
Coleman, 230 Ariz. at 355–56 ¶¶ 7–8, 284 P.3d at 866–67. We also review the
interpretation of a statute de novo. See Zamora v. Reinstein, 185 Ariz. 272,
275, 915 P.2d 1227, 1230 (1996).
A.
¶10 Generally, a claim of strict products liability may be based on
“informational defects encompassing instructions and warnings” that
render a product defective and unreasonably dangerous. Gosewisch v. Am.
Honda Motor Co., 153 Ariz. 400, 403, 737 P.2d 376, 379 (1987). To establish
such a claim, the plaintiff must prove, among other things, that the
manufacturer had a duty to warn of the product’s dangerous propensities
and that the lack of an adequate warning made the product defective and
unreasonably dangerous. Id. “In certain contexts, however, the
manufacturer’s or supplier’s duty to warn end users of the dangerous
propensities of its product is limited to providing an adequate warning to
an intermediary, who then assumes the duty to pass the necessary warnings
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Opinion of the Court
on to the end users.” Centocor, Inc. v. Hamilton, 372 S.W.3d 140, 154 (Tex.
2012). This legal doctrine is known as the LID.
¶11 In 1978, our court of appeals adopted the LID in a product
liability case against pharmaceutical companies that manufactured a drug
that allegedly was unsafe due to informational defects. Dyer v. Best
Pharmacal, 118 Ariz. 465, 577 P.2d 1084 (App. 1978). In affirming summary
judgment in favor of the drug companies, the court applied the LID, finding
that the doctrine was supported by principles of both duty and causation.
Id. at 467–69, 577 P.2d at 1086–88. Regarding duty, “[a] drug manufacturer
has discharged his duty to the public if he has properly warned the
administering physician of the contraindications and possible side effects
of the drug.” Id. at 468, 577 P.2d at 1087. Regarding causation, a learned
intermediary (the prescribing physician) who received an adequate
warning regarding a drug’s side effects or proper use but unforeseeably
disregarded the warning constituted an intervening, superseding event
that broke the chain of causation between the manufacturer and the patient.
Id. at 467–69, 577 P.2d at 1086–88.
¶12 As subsequent Arizona cases have recognized, the LID is
based on principles of duty, not causation. See, e.g., Dole Food Co. v. N.C.
Foam Indus., Inc., 188 Ariz. 298, 302–03, 935 P.2d 876, 880–81 (App. 1996)
(assessing factors to determine when, under the LID, the “manufacturer’s
duty to warn is ordinarily satisfied”); Davis v. Cessna Aircraft Corp., 182 Ariz.
26, 38, 893 P.2d 26, 38 (App. 1994) (applying the LID “to determine whether
[a manufacturer] satisfied its duty to warn”); see also Restatement (Third) of
Torts: Prod. Liab. § 6 cmt. b (Am. Law Inst. 1998) (“Third Restatement”)
(“The rationale supporting this ‘learned intermediary’ rule is that only
health-care professionals are in a position to understand the significance of
the risks involved and to assess the relative advantages and disadvantages
of a given form of prescription-based therapy. The duty then devolves on
the health-care provider to supply to the patient such information as is
deemed appropriate under the circumstances so that the patient can make
an informed choice as to therapy.”). Thus, the court of appeals here
correctly remarked that, “[i]n its application, the [LID] appears to be less a
rule of causation and more a standard for determining when a drug
manufacturer has satisfied its duty to warn.” Watts, 236 Ariz. at 517 ¶ 31,
342 P.3d at 853.
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Opinion of the Court
¶13 Manufacturers generally have a duty to warn consumers of
foreseeable risks of harm from using their products. See Third Restatement
at § 2. But under the LID, if the manufacturer provides complete, accurate,
and appropriate warnings about the product to the learned intermediary, it
fulfills its duty to warn the consumer. See id. at § 6; Centocor, 372 S.W.3d at
142. The premise for the LID is that certain types of goods (such as
prescription drugs) are complex and vary in effect, depending on the end
user’s unique circumstances, and therefore can be obtained only through a
qualified intermediary like a prescribing physician, who can evaluate the
patient’s condition and weigh the risks and benefits. See Reyes v. Wyeth
Labs., 498 F.2d 1264, 1276 (5th Cir. 1974). As applied to prescription drug
manufacturers, the Third Restatement states the doctrine as follows:
A prescription drug or medical device is not reasonably safe
due to inadequate instructions or warnings if reasonable
instructions or warnings regarding foreseeable risks of harm
are not provided to:
(1) prescribing and other health-care providers who
are in a position to reduce the risks of harm in accordance
with the instructions or warnings; or
(2) the patient when the manufacturer knows or has
reason to know that health-care providers will not be in a
position to reduce the risks of harm in accordance with the
instructions or warnings.
Third Restatement § 6(d).
¶14 Although the court of appeals has embraced the LID, this
Court has not yet addressed the doctrine. In our view, the Third
Restatement properly states the LID, and therefore we adopt § 6(d) as our
expression of it. Cf. Ft. Lowell-NSS Ltd. P’ship v. Kelly, 166 Ariz. 96, 102, 800
P.2d 962, 968 (1990) (“Absent Arizona law to the contrary, this court will
usually apply the law of the Restatement.”); Larkin v. Pfizer, Inc., 153 S.W.3d
758, 770 (Ky. 2004) (adopting the Restatement Third’s expression of the
LID); Freeman v. Hoffman-La Roche, Inc., 618 N.W.2d 827, 842 (Neb. 2000)
(adopting the Third Restatement § 6(d)). Adopting the doctrine places us
with the majority of jurisdictions that have considered the matter. See
generally Centocor, 372 S.W.3d at 158 n.17 (noting that “the highest courts of
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Opinion of the Court
at least thirty-five states have adopted some form of the [LID] within the
prescription drug products-liability context or cited favorably to its
application within this context”).
¶15 Contrary to Watts’s assertion, the LID does not create a
blanket immunity for pharmaceutical manufacturers. The doctrine does
not apply, for instance, if the manufacturer fails to provide adequate
warnings to the learned intermediary. See McEwen v. Ortho Pharm. Corp.,
528 P.2d 522, 529 (Or. 1974) (if it fails to properly warn the prescribing
physician, “the manufacturer is directly liable to the patient for a breach of
such duty.”); Pittman v. Upjohn Co., 890 S.W.2d 425, 429 (Tenn. 1994) (“[T]he
learned intermediary doctrine does not shield a drug manufacturer from
liability for inadequate warnings to the physician.”). In that event, as
Medicis acknowledged at oral argument in this Court, a patient could sue
and directly recover from a drug manufacturer based on its failure to
properly warn the prescribing physician.
¶16 Watts also asserts, and the court of appeals agreed, that the
underlying rationale for the LID is no longer viable. But we find persuasive
the reasoning of the Texas Supreme Court in rejecting this argument.
Prescription drugs are likely to be complex medicines,
esoteric in formula and varied in effect. As a medical expert,
the prescribing physician can take into account the
propensities of the drug, as well as the susceptibilities of his
patient. His is the task of weighing the benefits of any
medication against its potential dangers. The choice he makes
is an informed one, an individualized medical judgment
bottomed on a knowledge of both patient and palliative.
Pharmaceutical companies then, who must warn ultimate
purchasers of dangers inherent in patent drugs sold over the
counter, in selling prescription drugs are required to warn
only the prescribing physician, who acts as a “learned
intermediary” between manufacturer and consumer. . . .
Because patients can obtain prescription drugs only through
their prescribing physician or another authorized
intermediary and because the “learned intermediary” is best
suited to weigh the patient’s individual needs in conjunction
with the risks and benefits of the prescription drug, we are in
agreement with the overwhelming majority of other courts
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Opinion of the Court
that have considered the learned intermediary doctrine and
hold that, within the physician-patient relationship, the
learned intermediary doctrine applies and generally limits
the drug manufacturer’s duty to warn to the prescribing
physician.
Centocor, 372 S.W.3d at 159 (citations omitted); see also Larkin, 153 S.W.3d at
763–64 (stating that policy reasons support the LID because (1) the
“prescribing physician is in a superior position to impart the warning and
can provide an independent medical decision as to whether use of the drug
is appropriate for treatment of a particular patient,” (2) the “manufacturers
lack effective means to communicate directly with each patient,” and
(3) any duty to directly warn the end user would unduly interfere with the
physician-patient relationship).
¶17 In finding the policy rationale for the LID unpersuasive, the
court of appeals relied on State ex rel. Johnson & Johnson Corp. v. Karl, 647
S.E.2d 899 (W. Va. 2007). In Karl, the West Virginia Supreme Court found
the LID outdated and that “existing law of comparative contribution among
joint tortfeasors is adequate to address issues of liability among physicians
and drug companies . . . .” Id. at 913. No other court has followed Karl, and
several courts have criticized it. See Centocor, 372 S.W.3d at 158 (noting that
no other court has followed Karl); see also Tyree v. Boston Sci. Corp., 56 F.
Supp. 3d 826, 828 n.2 (S.D. W. Va. 2014) (discussing Karl and surveying
jurisdictions that have rejected its reasoning). Even the West Virginia
Supreme Court itself later relegated Karl to a “but see” citation, observing
that “the high degree of federal regulation of prescriptive drug products
attenuates the effect product marketing has on a consumer’s prescriptive
drug purchasing decision.” White v. Wyeth, 705 S.E.2d 828, 838 (W. Va.
2010). Like these other courts, we do not find Karl persuasive.
¶18 Watts alternatively urges this Court to adopt a
direct-to-consumer (“DTC”) advertising exception to the LID. See Perez v.
Wyeth Labs. Inc., 734 A.2d 1245, 1247, 1256 (N.J. 1999) (concluding that
“when mass marketing of prescription drugs seeks to influence a patient’s
choice of a drug, a pharmaceutical manufacturer that makes direct claims
to consumers for the efficacy of its product should not be unqualifiedly
relieved of a duty to provide proper warnings of the dangers or side effects
of the product,” and “[c]onsumer-direct advertising of pharmaceuticals
thus belies each of the premises on which the [LID] rests”). The Third
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Opinion of the Court
Restatement, however, provides a different exception to the LID that
sufficiently protects consumers. See Third Restatement § 6(d)(2) (“A
prescription drug or medical device is not reasonably safe due to
inadequate instructions or warnings if reasonable instructions or warnings
regarding foreseeable risks of harm are not provided to: . . . the patient
when the manufacturer knows or has reason to know that health-care
providers will not be in a position to reduce the risks of harm in accordance
with the instructions or warnings.”).
¶19 In light of this broad exception, we decline to recognize a DTC
advertising exception, which has been adopted only in New Jersey. See
Centocor, 372 S.W.3d at 161 (noting that “[i]n the more than twelve years
since Perez, many courts have declined to follow [New Jersey’s] sweeping
departure from the [LID]”); Larkin, 153 S.W.3d at 766 (surveying exceptions
to the LID and noting that only New Jersey has adopted the DTC
advertising exception); see also Beale v. Biomet, Inc., 492 F. Supp. 2d 1360,
1376 (S.D. Fla. 2007) (stating that “[s]ince Perez was decided, no court . . .
has recognized the DTC exception to the learned intermediary doctrine,
and several courts have expressly rejected the DTC exception”).
B.
¶20 In 1984, the Arizona Legislature enacted UCATA, which
allows a tortfeasor who paid more than its share of damages attributed to
it by the factfinder to seek contribution from other co-tortfeasors. A.R.S.
§ 12-2505. Three years later, the legislature amended the Act by eliminating
plaintiffs’ ability to recover jointly from any or all liable defendants. A.R.S.
§ 12-2506(A). This Court has noted that Arizona’s pure comparative fault
scheme protects defendants from bearing more than their fair share of
liability for a plaintiff’s injuries under the harsh common-law rule of joint
and several liability. State Farm Ins. Co. v. Premier Manufactured Sys., Inc.,
217 Ariz. 222, 224–25 ¶¶ 8–12, 172 P.3d 410, 412–13 (2007).
¶21 The court of appeals erred by concluding that the LID is
incompatible with UCATA. As the court correctly observed, “UCATA’s
ultimate effect was to prevent a partially responsible defendant from being
held liable for the damages caused by his co-defendant.” Watts, 236 Ariz.
at 518 ¶ 36, 342 P.3d at 854. The LID, the court reasoned, “precludes a
complete assessment of comparative fault among tortfeasors because it
preemptively limits the scope of a manufacturer’s duty.” Id. The court of
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appeals thus concluded that “applying the [LID] in the context of
prescription pharmaceuticals conflicts with both UCATA and the holding
of Premier Manufactured Systems that each defendant in a tort case is liable
for his or her own respective share of fault, no more and no less.” Id.
¶22 We find that reasoning flawed. Neither UCATA nor our case
law undermines the LID. UCATA requires apportionment of damages
based on degrees of fault. See A.R.S. §§ 12-2506(A) (“Each defendant is
liable only for the amount of damages allocated to that defendant in direct
proportion to that defendant’s percentage of fault . . . .”); -2506(B) (“In
assessing percentages of fault the trier of fact shall consider the fault of all
persons who contributed to the alleged injury . . . .”). “Fault” is defined as
“an actionable breach of legal duty, act or omission . . . .” A.R.S.
§ 12-2506(F)(2). Thus, UCATA’s scheme is premised on notions of fault,
which necessarily presuppose a breach of duty. Under the LID, however, a
manufacturer satisfies its duty to warn the end user by adequately warning
the learned intermediary, which duty, if satisfied, means that no actionable
breach of a legal duty to the end user occurs. See Dole Food, 188 Ariz. at
302-03, 935 P.2d at 880–81; Davis, 182 Ariz. at 38, 893 P.2d at 38.
¶23 Because the LID and UCATA address two distinct subjects,
they are not mutually exclusive. The LID identifies circumstances when a
manufacturer has met its duty to warn and thus is not at fault. UCATA
does not identify the scope of duties or when parties are at fault; instead,
given a determination that multiple parties are at fault, it specifies how
liability is apportioned among them.
¶24 In sum, the LID neither insulates a manufacturer from
liability in proportion to its share of fault nor shifts a disproportionate share
of liability to someone else. Rather, the doctrine provides a means by which
a manufacturer may satisfy its duty to warn the end user. A manufacturer
that properly warns the learned intermediary fulfills its duty, a result that
comports with UCATA because the drug manufacturer in that
circumstance has not breached its duty and therefore is not at fault. See
Thom v. Bristol-Myers Squibb Co., 353 F.3d 848, 853 (10th Cir. 2003) (noting
that “Wyoming’s [pure] comparative fault statute has no effect on the
application of the [LID]” because the doctrine “addresses a drug
manufacturer’s duty to provide a warning to consumers,” whereas the
statutory scheme does not “define[] or affect[] the scope of the defendant’s
initial duty”) (citations omitted). But if the manufacturer fails to properly
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Opinion of the Court
warn the learned intermediary, it may be found to have breached its duty
and its liability can be determined based on comparative fault under
UCATA.
C.
¶25 Watts and an amicus curiae also argue that the LID violates
the anti-abrogation clause in article 18, § 6 of the Arizona Constitution. This
clause provides that “[t]he right of action to recover damages for injuries
shall never be abrogated, and the amount recovered shall not be subject to
any statutory limitation . . . .” Ariz. Const. art. 18, § 6.
¶26 The LID is a common-law doctrine, not a statutory limitation.
See Third Restatement § 6 cmt. a; Cronin v. Sheldon, 195 Ariz. 531, 540–41
¶¶ 44–46, 991 P.2d 231, 240–41 (1999) (discussing that the anti-abrogation
clause limits the legislature’s ability to abrogate a common-law claim but
allows the legislature to regulate common-law claims). “Our
anti-abrogation jurisprudence normally asks whether a statute
unconstitutionally deprives a litigant of access to the courts.” Nunez v. Prof’l
Transit Mgmt. of Tucson, Inc., 229 Ariz. 117, 123 ¶ 26, 271 P.3d 1104, 1110
(2012). Article 18, § 6 does not preclude this Court from declaring,
clarifying, or modifying the common law, id., and therefore the LID does
not offend that clause.
¶27 Moreover, the LID does not abrogate a right to recover
damages, but instead provides a means for a manufacturer to fulfill its duty
to warn the end user by properly warning the learned intermediary. See
Third Restatement § 6 cmt. b; see also Larkin, 153 S.W.3d at 765. It does not
prevent a plaintiff from asserting an action against the manufacturer in
appropriate circumstances, such as when the full medical information and
warnings are not given to the medical provider. See Premier Manufactured
Sys., Inc., 217 Ariz. at 228 ¶¶ 27–30, 172 P.3d at 416; see also Baker v. Univ.
Physicians Healthcare, 231 Ariz. 379, 388 ¶¶ 34–35, 296 P.3d 42, 51 (2013)
(discussing that the plaintiff still had a reasonable possibility of obtaining
legal redress under the applicable statute); Nunez, 229 Ariz. at 122–23
¶¶ 24–26, 271 P.3d at 1109–10 (discussing that the application of a different
duty of care did not violate the anti-abrogation clause because the
defendant still had reasonable possibility of obtaining legal redress). The
LID also does not prevent the plaintiff from suing the prescribing medical
provider.
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D.
¶28 Watts did not allege in her complaint that she received the full
prescribing informational materials, see supra ¶ 3, but she did allege that
“Medicis provided” those warnings, without specifying to whom, and
attached them as an exhibit to her complaint. Watts also did not specifically
allege that Medicis breached its duty by giving inadequate or otherwise
defective warnings to her prescribing physician and other health-care
providers who were in a position to reduce the risks of harm. She did allege
more generally, however, that “Medicis failed to provide an adequate
warning of the danger” of using Solodyn for more than twelve weeks.
¶29 Viewed in a light most favorable to Watts, Cullen, 218 Ariz. at
419 ¶ 7, 189 P.3d at 346, her complaint implies that Medicis failed to give
appropriate warnings to her or the pertinent health-care provider.
Accordingly, we vacate the superior court’s dismissal of Watts’s product
liability claim and remand the case for further proceedings. If Medicis
establishes that there is no genuine factual dispute that it provided
complete, adequate warnings for Solodyn to Watts’s prescribing physician
and other health-care providers who were in a position to reduce the risks
of harm, the LID applies and, as a matter of law, Medicis satisfied its duty
to warn and would be entitled to summary judgment on the product
liability claim.
E.
¶30 Medicis additionally asserts that the court of appeals erred by
finding the CFA applicable to this case because prescription
pharmaceuticals are not merchandise and there is no direct
merchant-consumer transaction between drug manufacturers and patients.
We disagree.
¶31 The CFA provides:
The act, use or employment by any person of any
deception, deceptive or unfair act or practice, fraud, false
pretense, false promise, misrepresentation, or concealment,
suppression or omission of any material fact with intent that
others rely on such concealment, suppression or omission, in
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connection with the sale or advertisement of any merchandise
whether or not any person has in fact been misled, deceived
or damaged thereby, is declared to be an unlawful practice.
A.R.S. § 44-1522(A) (emphasis added). Thus, the statute does not expressly
require a direct merchant-consumer transaction. Rather, to succeed on a
claim of consumer fraud, a plaintiff must show (1) a false promise or
misrepresentation made in connection with the sale or advertisement of
“merchandise,” and (2) consequent and proximate injury resulting from the
misrepresentation. See Kuehn v. Stanley, 208 Ariz. 124, 129 ¶ 16, 91 P.3d 346,
351 (App. 2004).
¶32 The CFA defines “merchandise” as “any objects, wares,
goods, commodities, intangibles . . . .” A.R.S. § 44-1521(5). The statute does
not define “objects” or “goods.” Absent statutory definitions, courts
generally apply common meanings, State v. Cox, 217 Ariz. 353, 356 ¶ 20, 174
P.3d 265, 268 (2007), and may resort to dictionary definitions, State ex rel.
Montgomery v. Harris (Shilgevorkyan), 234 Ariz. 343, 344 ¶ 9, 322 P.3d 160,
161 (2014).
¶33 As relevant to this case, the noun “object” is defined as
“something that is put or may be regarded as put in the way of some of the
senses: a discrete visible or tangible thing.” Webster’s Third New
International Dictionary 1555 (2002). Likewise, a definition of “good” is
“tangible movable personal property having intrinsic value but [usually]
excluding money and other choses in action . . . .” Id. at 978. Under those
definitions, pharmaceutical drugs are objects and goods and thus constitute
“merchandise” under the CFA. The court of appeals did not err in
concluding that the CFA applies to prescription pharmaceuticals.
¶34 Here, Watts alleged an actionable claim under the CFA. She
alleged that Medicis affirmatively misrepresented Solodyn by stating that
“[t]he safety of using [Solodyn] longer than 12 weeks has not been studied
and is not known,” even though it knew (as Medicis’s full prescribing
informational material states) that taking the drug for longer than twelve
weeks can cause drug-induced lupus. The superior court thus erred in
dismissing Watts’s CFA claim.
¶35 We express no opinion on two points that were not argued in
either the trial court or court of appeals and are beyond the issues framed
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Opinion of the Court
in Medicis’s petition for review in this Court, without prejudice to the
parties further litigating them on remand: (1) whether the MediSAVE card
that Watts received is an “advertisement” under the CFA,
§§ 44-1521(1), -1522(A), and (2) whether federal law preempts Watts’s CFA
claim. See generally Third Restatement § 6 cmt. b. (discussing that federal
law may displace certain state tort claims).
III.
¶36 For the foregoing reasons, we vacate ¶¶ 28–41 of the court of
appeals’ opinion and affirm the portion relating to Watts’s CFA claim,
Watts, 236 Ariz. at 516–17 ¶¶ 23–27, 342 P.3d at 852–53. We reverse the
superior court’s order dismissing Watts’s complaint, and we remand the
case to that court for further proceedings consistent with this opinion.
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