LEONARD COTTRELL; SANDRA HENON; WILLIAM REEVES; GEORGE HERMAN; SIMON NAZZAL; CAROL FREBURGER; JACK LIGGETT; PATRICIA BOUGH; MACK BROWN; DOLORES GILLESPIE; DEBORAH HARRINGTON; ROBERT INGINO; EDWARD ROGERS, JR.; DEBORAH RUSIGNULOLO; DOROTHY STOKES; JOSEPHINE TROCCOLI; HURIE WHITFIELD; THOMAS LAYLOFF; CAROLYN TANNER; PATSY TATE; JOHN SUTTON; JESUS RENTERIA; GLENDELIA FRANCO; NADINE LAMPKIN, on behalf of themselves and all others similarly situated, Appellants
ALCON LABORATORIES; ALCON RESEARCH LTD; FALCON PHARMACEUTICALS LTD; SANDOZ INC.; ALLERGAN INC, RP; ALLERGAN USA INC; ALLERGAN SALES LLC; PFIZER INC; VALEANT PHARMACEUTICALS INTERNATIONAL; BAUSCH & LOMB INC; ATON PHARMA INC; MERCK & CO INC; MERCK SHARP & DOHME CORP; PRASCO LLC; AKORN INC
Argued: January 24, 2017
Appeal from the United States District Court for the District
of New Jersey (D.C. Civil Action No. 3-14-cv-05859) District
Judge: Honorable Freda L. Wolfson
M. NICHOLLS, ESQ. [ARGUED] Public Justice, P.C. RICHARD S.
CORNFELD, ESQ. Law Office of Richard S. Cornfeld JOHN G.
SIMON, ESQ. KEVIN M. CARNIE, JR., ESQ. The Simon Law Firm,
P.C. JEFFREY W. HERRMANN, ESQ. Cohn Lifland Pearlman Herrmann
& Knopf LLP Park BRIAN S. WOLFMAN, ESQ. Counsel for
E. BLADOW, ESQ. [ARGUED] AUSTIN C. NORRIS, ESQ. Kirkland
& Ellis LLP Counsel for Appellee Pfizer, Inc.
M. WALSH, ESQ. ELEONORE OFOSU-ANTWI, ESQ. Walsh Pizzi
O'Reilly & Falanga LLP Counsel for Appellees Pfizer,
Inc., Valeant Pharmaceuticals International, Inc., Bausch
& Lomb Incorporated, and Aton Pharma, Inc.
B. KAPLAN, ESQ. Greenberg Traurig, LLP GREGORY E. OSTFELD,
ESQ. Greenberg Traurig, LLP LORI G. COHEN, ESQ. Greenberg
Traurig, LLP Counsel for Appellees Alcon Laboratories, Inc.,
Alcon Research Ltd., Sandoz Inc. and Falcon Pharmaceuticals,
CHARLES B. CASPER, ESQ. Montgomery McCracken Walker &
Rhoads, LLP LibertyView, STEPHEN G. STRAUSS, ESQ. TIMOTHY J.
HASKEN, ESQ. Bryan Cave LLP Counsel for Appellees Merck &
Co., Inc., Merck Sharp & Dohme Corp., and Prasco, LLC.
J. MCGUIRL, ESQ. Law Offices Of Robert J. McGuirl, LLC
Counsel for Appellees Allergan, Inc., Allergan USA, Inc., and
Allergan Sales, LLC
P. MUEHLBERGER, ESQ. LORI A. MCGRODER, ESQ. Shook Hardy &
Bacon LLP Counsel for Appellees Allergan, Inc., Allergan USA,
Inc., Allergan Sales, LLC, Valeant Pharmaceuticals
International, Inc., Bausch & Lomb Incorporated, and Aton
H. SWAYZE, III, ESQ. MEGAN E. GROSSMAN, ESQ. KYLE G. EVERLY,
ESQ. Segal Mccambridge Singer & Mahoney, Ltd. JOHN M.
KILROY, JR., ESQ. Polsinelli PC J. STANTON HILL, ESQ.
Polsinelli PC Counsel for Appellee Akorn, Inc.
NEPVEU, ESQ. AARP Foundation Litigation Counsel for Amicus
AARP & AARP Foundation, in support of Appellants
RICHARD A. DEAN, ESQ. Tucker Ellis Daniel J. Kelly, ESQ.
Tucker Ellis LLP Counsel for Amicus Generic Pharmaceutical
Association, in support of Appellees
JEFFREY S. BUCHOLTZ, ESQ. PAUL A. MEZZINA, ESQ. King &
Spalding Counsel for Amicus Chamber of Commerce of the United
States of America, American Tort Reform Association,
Pharmaceutical Research and Manufacturers of America, and
National Association of Manufacturers in support of Appellees
HOTCHKISS, ESQ. Goldberg Segalla Counsel for Amicus Product
Liability Advisory Council, in support of Appellees
Michael J. Quirk, ESQ. Williams Cuker Berezofsky, LLC
National Association of Consumer Advocates
Before: CHAGARES, RESTREPO, and [*] ROTH, Circuit Judges
RESTREPO, CIRCUIT JUDGE
putative class action, consumers of prescription eye
medication allege that manufacturers and distributors of the
medication packaged it in such a way that forced them to
waste it, violating the consumer protection statutes of their
home states. The District Court dismissed the entire action
for lack of jurisdiction, finding the consumers'
allegations of injury in fact insufficient to confer
standing. For the reasons that follow, we will reverse the
dismissal, and remand the case for further consideration.
Defendants are manufacturers and distributors of generic and
brand-name prescription eye drop medications that are
approved by the Food and Drug Administration
("FDA") to treat serious medical conditions such as
glaucoma, a leading cause of blindness. Defendants sell
these prescription medications in fluid form and package the
fluid in plastic bottles. Bottles are pre-packaged with a
fixed volume of medication (e.g., 5.0 mL) sold at set prices.
Labeling on the bottles does not indicate how many doses or
days of treatment a patient will be able to extract from the
is dispensed from the plastic bottles into patients' eyes
in drop form. The dimensions of the bottle's dropper tip
dictate the size of the drop dispensed from that bottle. In
effect, the larger the bottle dropper tip, the larger the
drop dispensed. There is no reasonable way for a patient to
instill less than one full drop into his or her eye.
plethora of scientific research conducted over the last four
decades has examined the drop size of Defendants'
medications; some of the studies conducted were, in fact,
sponsored and published by Defendants. According to these
studies, a normal adult's inferior fornix - the area
between the eye and the lower eyelid - has a capacity of
approximately 7 to 10 microliters ("µLs") of
fluid. If a drop of medication exceeding that
capacity is placed into an adult patient's eye, excess
medication is expelled. Expelled medication may run down a
patient's cheek, providing no pharmaceutical benefit to
the patient whatsoever. This medication is "entirely
wasted" by the patient. App. 182. Expelled medication
also may flow into a patient's tear ducts and move into
his or her bloodstream. Medication entering a patient's
bloodstream may increase a patient's risk of experiencing
certain harmful systemic side effects.
studies conclude that eye drops should be 5 to 15 µLs
in order to maximize the amount of the medication entering
the inner eye - the site of action for the medication. Drop
sizes within this range minimize overflow "waste"
and also minimize the risk of side effects.
the scientific consensus on drop size, all of Defendants'
products at issue emit drops that are considerably larger
than 15 µLs. In fact, a 2008 study showed that each
Defendant's drop size was more than two to three times
the 15 µL maximum recommended size. Several Defendants
sold products with drop sizes of 50 µL. To put these
data in perspective, at least half of every drop of
medication dispensed from any one of Defendants' product
bottles goes to waste on a patient, and may put the patient
at risk of side effects.
Plaintiffs in this litigation are individuals who paid for
Defendants' eye drop medication. They allege that
Defendants have control over the design and dimensions of the
bottle dropper tip, and thus could reduce the size of drops
emitted from their product bottles, but have chosen not to do
so. Plaintiffs do not purport to have personal knowledge as
to why no defendant has reduced their products' drop
sizes. However, Plaintiffs include in the Amended Complaint
allegations that senior executives at Defendant Alcon
explained to a consultant working with them that they were
unwilling to reduce drop sizes because if they did, the
company "would sell less product and make less
money." App. 244.
aver that Defendants' practices of selling medication in
bottles that emit such large drops caused them
"substantial" economic injury. App. 214.
Specifically, Plaintiffs allege, "If the sizes of
Defendants' prescription eye drops were limited to the
maximum effective size of 15 µL . . . the medication in
the bottles would last longer and [Plaintiffs] would spend
substantially less on their therapy than they do with larger,
substantially wasted, eye drops." App. 214. Plaintiffs
illustrated this point in their Amended Complaint with an
example provided in a 2008 scientific study:
[T]he average drop size for Allergan's glaucoma drug
Alphagan P . . . in a 5 mL bottle was 43 μL . . . . At the
recommended dose of one drop in each affected eye three times
daily, a 5 mL bottle would last a patient with bilateral
glaucoma 20 days. That patient would go through 18.25 bottles
in a year. In July 2013, a 5 mL bottle of Alphagan P . . .
cost $104.99. A year's course of treatment would
therefore cost approximately $1, 915. However, approximately
65% of the medication, the amount over 15 μL, would be
wasted. If the drops had been only 15 μL, the patient
would have needed only 6.46 bottles a year, or 7.0 bottles if
the drops had been 16 μL .... The unneeded
medication would cost the patient more than $1, 100 a
App. 215-216 (emphasis added). Plaintiffs also quantified
their individual economic injuries in charts attached to the
claim they could not have avoided these economic injuries;
they were "compelled] [by Defendants' practices] to
spend more money on their therapy than if the drops were 15
µL." App. 214. They had no non-pharmaceutical
alternative treatments for their conditions. And there were
no alternative products to Defendants'; "all
prescription eye drops are substantially larger than 15
µL and therefore lead to wastage." App. 217. Their
only alternative was to forgo treatment and risk blindness or
September 2014, Plaintiffs filed a putative class action
complaint, on behalf of themselves and other similarly
situated parties, in the United States District Court for the
District of New Jersey. Plaintiffs asserted violations of the
consumer protection laws of their respective home states: the
New Jersey Consumer Fraud Act ("NJCFA"), N.J.S.A.
§ 56:8-1, et seq.; the California Unfair
Competition Law ("UCL"), Cal. Bus. Prof. Code
§ 17200, et seq.; the Florida Deceptive and
Unfair Trade Practices Act ("FDUTPA"), Fla. Stat.
§ 501.201, et seq.; the Illinois Consumer Fraud
Act ("ICFA"), 815 ILCS 505/1, et seq.; the
North Carolina Unfair and Deceptive Trade Practices Act
("NCUTDPA"), N.C. G.S. § 75-1.1, et
seq.; and the Texas Deceptive Trade Practices Act
("DTPA"), Tex. Bus. & Com. Code § 17.41,
et seq. Plaintiffs claimed Defendants' practices
in manufacturing and selling prescription eye drop medication
violated the statutes' prohibitions on unfair or
unconscionable trade practices. The District Court dismissed
Plaintiffs' original complaint for lack of standing,
without prejudice to Plaintiffs' ability to amend the
complaint and cure the standing deficiencies.
2015, Plaintiffs filed an Amended Complaint, asserting claims
of unfair or unconscionable practices under the same six
state consumer protection statutes. Plaintiffs supported their
allegations of unfair or unconscionable practices with: (a)
scientific literature opining on costs savings occasioned by
utilizing smaller drop sizes; and (b) charts showing each
Plaintiff's expenses. The charts detailed
medication purchases and the out-of-pocket expenses they
incurred for their purchases. Using these charts and
information about each product's drop size, Plaintiffs
calculated their total out-of-pocket payments on
"wasted" medication. These totals ranged from a few
dollars to a few hundred dollars.
August 2015, Defendants moved to dismiss Plaintiffs'
Amended Complaint for lack of standing, federal preemption,
and failure to state a claim. The District Court granted
Defendants' motions, finding that Plaintiffs had not
pleaded an injury in fact necessary to confer standing. As a
result, the court did not reach Defendants' arguments on
preemption and the sufficiency of Plaintiffs' claims
under Federal Rule of Civil Procedure 12(b)(6). Plaintiffs
then filed this timely appeal.
District Court had jurisdiction pursuant to the Class Action
Fairness Act ("CAFA"), 28 U.S.C. § 1332(d),
because at least one member of the Plaintiff class is diverse
from at least one of the Defendants, the putative class is
composed of at least 100 people, and the amount in
controversy exceeds five million dollars. We have
jurisdiction over the District Court's dismissal of the
case pursuant to 28 U.S.C. § 1291.
exercise plenary review over a dismissal for lack of
standing. In re Schering Plough Corp. Intron/Temodar
Consumer Class Action, 678 F.3d 235, 243 (3d Cir. 2012).
III of the United States Constitution limits the power of the
federal judiciary to "cases" and
"controversies." U.S. Const. art. III. For a
federal court to exercise jurisdiction under Article III,
plaintiffs must allege - and eventually prove - that they
having "standing" to pursue their claims. See
Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61
(1992). The doctrine of standing emerged from "the
traditional understanding of a case or controversy" in
order "to ensure that federal courts do not exceed their
[constitutional] authority" by "unsurp[ing] the
powers of the political branches." Spokeo, Inc. v.
Robins, 136 S.Ct. 1540, 1547 (2016) (quoting Clapper
v. Amnesty Int'l USA, 133 S.Ct. 1138, 1146 (2013)).
"The doctrine limits the category of litigants empowered
to maintain a lawsuit in federal court to seek redress for a
legal wrong." Id.
plaintiff, "as the party invoking federal jurisdiction,
" bears the burden of establishing the minimal
requirements of Article III standing: "(1) . . . an
injury in fact, (2) that is fairly traceable to the
challenged conduct of the defendant, and (3) that is likely
to be redressed by a favorable judicial
decision." Id. In assessing whether a
plaintiff has carried this burden, we separate our standing
inquiry from any assessment of the merits of the
plaintiff's claim. To maintain this fundamental
separation between standing and merits at the dismissal
stage, we assume for the purposes of our standing inquiry
that a plaintiff has stated valid legal claims. Info.
Handling Servs., Inc. v. Defense Automated Printing
Servs., 338 F.3d 1024, 1029 (D.C. Cir. 2003) (citing
Warth v. Seldin, 422 U.S. 490, 500 (1975)). While
our standing inquiry may necessarily reference the
"nature and source of the claim[s] asserted, "
Warth, 422 U.S. at 500, our focus remains on whether
the plaintiff is the proper party to bring those claims,
The Pitt News v. Fisher, 215 F.3d 354, 360 (3d Cir.
2000); White Tail Park, Inc. v. Stroube, 413 F.3d
451, 460-61 (4th Cir. 2005).
case centers on the "[f]irst and foremost" of the
three standing elements, injury in fact. Spokeo, 136
S.Ct. at 1547 (quoting Steel Co. v. Citizens for Better
Env't, 523 U.S. 83, 103 (1998)). The purpose of the
injury-in-fact requirement, the Supreme Court has explained,
is "to distinguish a person with a direct stake in the
outcome of a litigation - even though small - from a person
with a mere interest in the problem." United States
v. Students Challenging Regulatory Agency Procedures
(SCRAP), 412 U.S. 669, 689 n.14 (1973). Put differently,
the requirement serves to filter out those "with merely
generalized grievances" who are "bringing suit to
vindicate an interest common to the entire public."
Friends of the Earth, Inc. v. Gaston Copper Recycling
Corp., 204 F.3d 149, 156 (4th Cir. 2000). The
injury-in-fact requirement is "very generous" to
claimants, demanding only that the claimant "allege[ ]
some specific, 'identifiable trifle' of injury."
Bowman v. Wilson, 672 F.2d 1145, 1151 (3d Cir. 1982)
(quoting SCRAP, 412 U.S. at 686-90 & 689 n.14).
It "is not Mount Everest." Danvers, 432
F.3d at 294.
allege injury in fact sufficiently, a plaintiff must claim
"that he or she suffered 'an invasion of a legally
protected interest' that is 'concrete and
particularized' and 'actual or imminent, not
conjectural or hypothetical.'" Spokeo, 136
S.Ct. at 1548 (quoting Lujan, 504 U.S. at 560).
Typically, a plaintiff's allegations of financial harm
will easily satisfy each of these components, as financial
harm is a "classic" and "paradigmatic
form" of injury in fact. Danvers, 432 F.3d at
291, 293. Indeed, we have explained that where a plaintiff
alleges financial harm, standing "is often assumed
without discussion." Id. at 293; see also
Carter v. HealthPort Techs., LLC, 822 F.3d 47,
55 (2d Cir. 2016) ("Any monetary loss suffered by the
plaintiff satisfies [the injury-in-fact] element; '[e]ven
a small financial loss' suffices." (quoting Nat.
Res. Def. Council, Inc. v. U.S. Food & Drug Admin.,
710 F.3d 71, 85 (2d Cir. 2013))); Cent. Ariz. Water
Conservation Dist. v. U.S. E.P.A., 990 F.2d 1531, 1537
(3d Cir. 1993) ("Pecuniary injury is clearly a
sufficient basis for standing." (internal quotation
marks and citation omitted)).
the District Court provided a detailed recitation of standing
law in its opinion, including the components of injury in
fact, it did not apply those individual components to
Plaintiffs' allegations. Rather, it framed its
injury-in-fact analysis around broader principles and
theories of standing, as did the parties in their briefing to
this Court. This approach has some persuasive appeal. But
where the court or litigants cast aside the essential
components of injury in fact in favor of more generalized,
abstract discussion, they risk improperly, if ...