In Re Diet Drugs (Phentermine/Fenfluramine/ Dexfenfluramine) Products Liability Litigation

NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
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No. 14-2729
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IN RE: DIET DRUGS (PHENTERMINE/FENFLURAMINE/
DEXFENFLURAMINE) PRODUCTS LIABILITY LITIGATION
PATTI KENNEDY, ACTING ON BEHALF OF THE ESTATE OF
DENNIS J. KENNEDY AND ACTING INDIVIDUALLY
AS THE SPOUSE OF DENNIS J. KENNEDY,
Appellant
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On Appeal from the United States District Court
for the Eastern District of Pennsylvania
(D.C. Civil Nos. 2-99-cv-20593; 2-11-md-01203; 2-16-md-01203)
District Judge: Hon. Harvey Bartle, III
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Submitted Pursuant to Third Circuit LAR 34.1(a)
December 11, 2014
BEFORE: VANASKIE, GREENBERG and COWEN, Circuit Judges
(Filed: February 24, 2015)
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OPINION*
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*
This disposition is not an opinion of the full Court and pursuant to I.O.P. 5.7 does not
constitute binding precedent.
COWEN, Circuit Judge.
The Estate of Dennis J. Kennedy (“Estate”) appeals from the order of the United
States District Court for the Eastern District of Pennsylvania denying its claim for Matrix
A benefits under the terms of the Diet Drug Nationwide Class Action Settlement
Agreement (“Settlement Agreement”). We will affirm.
I.
This case is part of an ongoing multi-district litigation concerning diet drugs called
“Pondimin” and “Redux,” which were previously sold by Wyeth.1 Under the Settlement
Agreement, Wyeth was required to contribute funds to a trust for the payment of claims.
The Settlement Trust (“Trust”) reviews class members’ claims to determine their
eligibility for benefits. “Matrix benefits” are based on two benefit matrices, which
classify claimants pursuant to certain factors, including the presence of other medical
conditions that may have caused or contributed to valvular heart disease. For instance,
Matrix A-1 describes the compensation available to claimants who do not have any of the
alternative causes of valvular heart disease that made the B matrices applicable. The B
Matrix applies to claimants with a congenital bicuspid aortic valve.
Kennedy, a registered class member under the Settlement Agreement, underwent
aortic valve surgery in 2007. He died later that same year. Patti Kennedy, the personal
representative of the Estate, filed a claim for Matrix A benefits in 2011. On the requisite
“Green Form,” Dr. Manoj Muttreja attested that Kennedy did not suffer from congenital
1
Prior to March 11, 2002, Wyeth was known as American Home Products
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aortic valve abnormalities. The Trust forwarded the claim to Dr. Rohit Parmar, one of its
auditing cardiologists. Dr. Parmar found that there was no reasonable medical basis for
Dr. Muttreja’s representation concerning the absence of a congenital aortic valve
abnormality. The Trust accordingly determined that the Estate was only entitled to
Matrix B-1 benefits. After the Estate contested the post-audit determination, the auditing
cardiologist again stated that there was no reasonable medical basis for the attesting
physician’s finding. The Trust issued a final post-audit determination denying Matrix A-
1 benefits, and the Estate requested that the claim proceed to the show cause process
established by the Settlement Agreement. The District Court issued an order to show
cause and referred the matter to the Special Master for further proceedings. The Special
Master allowed the Estate to submit a declaration signed by Dr. Paul Dlabal. The Special
Master also asked a Technical Advisor, Dr. Gary Vigilante, to review the documentation
and prepare a report. Like the auditing cardiologist, the Technical Advisor indicated that
there was no reasonable medical basis for the attesting physician’s finding that Kennedy
did not have a congenital aortic valve abnormality.
On April 16, 2014, the District Court entered “Pretrial Order No. 9226.” In this
order, the District Court: (1) affirmed the Trust’s final post-audit determination, denied
the Matrix A claims submitted by the Estate and Patti Kennedy, and concluded that they
were entitled only to Matrix B-1 benefits; (2) overruled the objections to the Special
Master’s order referring the claim to a Technical Advisor and denied the motion to close
Corporation.
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the show cause record; and (3) denied the motion for inclusion of the contributions made
by Dr. Muttreja and Dr. Dlabal to the Estate’s response to the report of the Technical
Advisor and overruled the objections to the Special Master’s order.
II.
“Once the Trust denies a claim and the claim advances to a show cause
proceeding, the claimant has the burden of proving there was a reasonable medical basis
for the attesting physician’s representations.”2 In re Diet Drugs, 543 F.3d 179, 189 (3d
Cir. 2008) (citing PTO 2457). According to the Estate, the District Court has failed to set
forth a rule of law defining what exactly constitutes “a reasonable medical basis.” The
Estate asserts that deference should be given to the attesting physician’s opinion, to
opinions offered by physicians with higher levels of training, and to the observations of
doctors who personally observed the aortic valve in vivo. It also contends that, “if an
attesting physician finds that there is a reasonable medical basis to support the claim, the
Trust must present some evidence in support of unreasonableness.” (id. at 27 (citing Diet
Drugs, 543 F.3d at 189).)
We agree with the Trust that the District Court has adequately articulated (and
2
The District Court exercised diversity jurisdiction pursuant to 28 U.S.C. § 1332.
We have appellate jurisdiction under 28 U.S.C. § 1291.
“We review a District Court’s exercise of its equitable authority to administer and
implement a class action settlement for abuse of discretion.” Diet Drugs, 543 F.3d at 184
n.10 (citing In re Cendant Corp. Prides Litig., 244 F.3d 188, 192 (3d Cir. 2000)). The
district court commits an abuse of discretion if its decision rests on a clearly erroneous
finding of fact, an errant conclusion of law, or an improper application of law to fact.
See, e.g., id.
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applied) the standard or rule of law governing this “reasonable medical basis”
determination. The Settlement Agreement authorizes the District Court to deny a claim
“[i]f the Court determines that there was no reasonable medical basis to support a material
representation made by a physician in support of a Claim.” (JA962.) The District Court
has applied this “reasonable medical basis” requirement in numerous cases, and it has
done so in a consistent and conscientious fashion. In fact, we have repeatedly upheld its
“reasonable medical basis” determinations on appeal. See, e.g., id. at 182-90. The Estate
suggests that the Trust must put forth evidence to show that the physician’s representation
rises to the level of an act of medical malpractice. Such a drastic approach would
essentially require the Trust and the District Court to approve every claim for benefits
except in the most extreme circumstances. However, the District Court previously found
that there was good cause to require auditing every Matrix claim. Likewise, it is the
claimant’s burden to prove the reasonableness of his or her claim in any subsequent show
cause proceeding before the District Court. See, e.g., id. at 189. The District Court’s
ruling is then subject to review under this Court’s deferential “abuse of discretion”
standard.
The Estate argues at some length in its appellate briefing that the attesting
physician, the supporting cardiologist, the treating cardiologists, Kennedy’s surgeon, and
even the auditing cardiologist “provided overwhelming evidence supporting a reasonable
medical basis for the absence of a congenital bicuspid aortic valve.” (Appellant’s Brief at
26-27.) The District Court properly relied on the specific findings of the auditing
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cardiologist and the Technical Advisor to dispose of the Estate’s claim for Matrix A
benefits. The auditing cardiologist stated that “a bicuspid aortic valve” was “clearly
seen” on the March 28, 2007 echocardiogram. (JA3071.) The Technical Advisor then
explained in some detail why the February 7, 2002, the March 5, 2007, and the March 28,
2007 echocardiograms indicated the existence of a congenital bicuspid aortic valve. In
the process, he specifically addressed Dr. Dlabal’s declaration and took into consideration
the observations of the doctor who performed the aortic valve surgery. Given the record,
we cannot conclude that the District Court committed an abuse of discretion in holding
that the Estate failed to prove a reasonable medical basis for the attesting physician’s
finding regarding the absence of a congenital aortic valve abnormality. See, e.g., In re
Orthopedic Bone Screw Prods. Liab. Litig., 246 F.3d 315, 320 (3d Cir. 2001) (“‘The test
is not what this court would have done under the same circumstances; that is not enough.
The court must feel that only one order could have been entered on the facts.’” (citation
omitted)).
Finally, neither the District Court nor the Special Master violated the terms of the
Settlement Agreement, the Audit Rules, or the Due Process Clause of the Fifth
Amendment by precluding the Estate from including verified rebuttals from Dr. Muttreja
and Dr. Dlabal in its response to Dr. Vigilante’s report. The Estate claims that it had the
right to offer expert rebuttals to the report prepared by the Technical Advisor (which
purportedly injected new testimony and facts into this case). While Audit Rule 18(b)
permits the claimant to submit a verified statement of a medical expert at the contest stage
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before the Trust (and Audit Rule 26 authorizes the Special Master to allow the claimant to
submit a medical report with the response to the Trust’s show cause statement), Audit
Rule 34 provides that both the Trust and the claimant may submit a response to the
Technical Advisor’s report “not exceeding five pages in length”—which “may address
only the findings of the Technical Advisor and shall be limited to the evidence already in
the Special Master Record” (JA1455). The Audit Rules are meant “to curtail protracted,
unending submission of expert opinions in the show cause process.” (Appellee’s Brief at
37 (citing JA1447, JA1452).) However, the procedures still provide the claimant with
ample and meaningful opportunities to be heard. See, e.g., AJA Assocs. v. Army Corps
of Eng’rs, 817 F.2d 1070, 1073 (3d Cir. 1987) (“‘The fundamental requirement of due
process is the opportunity to be heard “at a meaningful time and in a meaningful
manner.”’” (citations omitted)). In fact, the Special Master allowed the Estate to file a
declaration from Dr. Dlabal in this show cause proceeding.
III.
For the foregoing reasons, we will affirm the order of the District Court.
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