Two U.S. Courts of Appeals recently cited the Restatement of the Law Third, Torts: the First Circuit cited the Restatement of the Law Third, Torts: Products Liability § 4 and the Seventh Circuit cited Restatement of the Law Third, Torts: Liability for Physical and Emotional Harm §§ 27 and 34. Summaries of those opinions are provided below.

The first case, In re Celexa and Lexapro Marketing and Sales Practices Litigation, 2019 WL 364019 (1st Cir. Jan. 30, 2019), involved consolidated appeals arising out of “off-label” prescription-drug-marketing cases, in which the plaintiffs alleged that the defendants, pharmaceutical corporations that manufactured and marketed the antidepressant medications Celexa and Lexapro, “engaged in fraud to push their antidepressant drugs on unsuspecting minors” from 1998 to 2009, even though the FDA had not approved the use of Lexapro for the “treatment of depression in adolescents” until 2009, “never approved Celexa for any pediatric use,” and never approved Lexapro as a “treatment for depression in children.” Two plaintiffs, a consumer and a health-and-benefit fund, appealed, among other things, the U.S. District Court for the District of Massachusetts’s entry of summary judgment dismissing their claims.

The First Circuit reversed the district court’s entry of summary judgment for the defendants on the two plaintiffs’ claims, holding, inter alia, that the fact that the FDA later approved Lexapro for lawful sales did “not preclude a jury from concluding that the off-label uses of Celexa and Lexapro at issue in this case were ineffective in treating pediatric depression,” and that the plaintiffs provided “competent and sufficient evidence . . . to raise a genuine issue of material fact as to the efficacy of these drugs for pediatric use.”

In making its decision, the court rejected the defendants’ argument that two of its prior decisions, D’Agostino v. ev3, Inc., 845 F.3d 1 (1st Cir. 2016) and In re Celexa and LexaproMarketing and Sales Practices Litigation, 779 F.3d 34 (1st Cir. 2015), “deem[ed] FDA approval dispositive” and therefore the FDA’s “various pronouncements or actions” involving this case precluded plaintiffs from convincing a jury that either Celexa or Lexapro was ineffective. The court noted, however, that the FDA’s subsequent approval of Lexapro could be relevant to the case, reasoning that a jury could view it as strong evidence confirming that Lexapro, and perhaps also Celexa, “ha[d] always been efficacious in treating pediatric depression.” The court quoted Restatement of the Law Third, Torts: Products Liability § 4 in explaining that, while the common law had long recognized that “agency approval of this type [was] relevant in tort suits,” such evidence was not always preclusive, and, in this case, “the FDA’s subsequent approval of Lexapro [did] not preclude proving that pre-approval uses of these drugs were ineffective.”

In Kemper v. Deutsche Bank AG, 911 F.3d 383 (7th Cir. 2018), a mother of a U.S. Army Specialist who was killed by a roadside bomb while serving in Iraq brought an action under the Anti-Terrorism Act (“ATA”) against a German bank with U.S. affiliates, alleging that “the bomb that killed her son was a signature Iranian weapon that traveled from the Iranian Revolutionary Guard Corps . . . to Hezbollah to Iraqi militias, who then placed it in the ground,” and that the defendant was connected to the bomb because it was a member of “an Iranian conspiracy to commit acts of terror” since it “instituted procedures to evade U.S. sanctions and facilitate Iranian banking transactions.”

The U.S. District Court for the Southern District of Illinois dismissed the plaintiff’s complaint for failure to state a claim, finding that she failed to plead facts that plausibly indicated that the defendant’s actions caused her son’s death. The Seventh Circuit affirmed, holding, inter alia, that the defendant’s “procedures to evade U.S. sanctions and facilitate Iranian banking transactions” were not the proximate cause of the death of the plaintiff’s son.

The court explained that previously, in Boim v. Holy Land Foundation for Relief and Development, 549 F.3d 685, 695-699 (7th Cir. 2008), it had recognized that strict “but for” causation was not necessary to prove ATA liability, because providing material support to terrorists was a wrongful act that created liability regardless of literal “but for” causation, since it was done in the context of others committing similar wrongful acts. It cited Restatement of the Law Third, Torts: Liability for Physical and Emotional Harm § 27, Comments f and g, for additional support. The court pointed out that it did not need to address the defendant’s argument that Boim was no longer good law on this point because of subsequent U.S. Supreme Court decisions, given that the plaintiff’s complaint failed plausibly to allege proximate causation.

The court went on to discuss how the plaintiff’s complaint “fail[ed] to suggest how her theory might overcome the traditional tort doctrine of superseding or intervening cause,” pointing to the number of criminal intervening acts separating the defendant from the terrorist attack that killed her son. Citing Restatement of the Law Third, Torts: Liability for Physical and Emotional Harm § 34, Comment e, the court noted that “We have recognized, consistently with the Restatement (Third) of Torts, that although ‘criminal acts are not superseding causes per se[,] . . . acts that are either criminal or intentionally tortious . . . are more likely to be adjudged superseding causes.’”

The Institute is currently working on other projects that will complete the Restatement of the Law Third, Torts. The Liability for Economic Harm project was concluded at the 2018 Annual Meeting and will be published later this year. Ongoing Restatement of the Law Third, Torts, projects include: Defamation and Privacy, Intentional Torts to Persons, Remedies, and Concluding Provisions. The subject of property torts will be addressed in the Restatement of the Law Fourth, Property.

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Megan Dingley

The American Law Institute

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