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LYNNBROOK FARMS v. SMITHKLINE BEECHAM

March 30, 1995

LYNNBROOK FARMS, PLAINTIFF,
v.
SMITHKLINE BEECHAM CORPORATION AND NORDEN LABORATOTIES, DEFENDANTS.



The opinion of the court was delivered by: Mihm, Chief Judge.

ORDER

This matter comes before the Court on Defendants' Motion to Dismiss [7] and Motion for Summary Judgment [15]. Pursuant to Local Rule 1.4, the Motion to Dismiss was referred to Magistrate Judge Robert J. Kauffman. While reviewing the motion, Magistrate Kauffman determined that due to the existence of the affirmative defense of federal preemption, the Motion to Dismiss should not be ruled upon until the parties had briefed the preemption issue. (Order dated October 12, 1994). The Defendants subsequently filed their Motion for Summary Judgment, which relies solely on the issue of federal preemption in support of the motion. This Court heard oral argument on the motion on February 24, 1995 and gave the parties leave to file proposed findings of fact and conclusions of law. (Transcript of 2/24/95 hrg. at 22-23). Defendants timely filed their Proposed Findings of Fact and Conclusions of Law [23]. Plaintiff has apparently elected not to file a proposed pleading. The Court has reviewed the pleadings, affidavits and other materials submitted to the Court in support of and in opposition to the Motion for Summary Judgment and, for the reasons set forth herein, GRANTS the Motion for Summary Judgment [15] and finds the Motion to Dismiss DENIED [7] as moot.

Findings of Fact

Plaintiff, Lynnbrook Farms, is a general partnership organized under the laws of Illinois. (Amended Complaint at 1). Defendant Norden Laboratories merged into Smithkline Beecham on or about January 1, 1992. (Answer to Amended Complaint at 3). Prior to the merger, Norden Laboratories existed as a Delaware corporation. (Amended Complaint at 2). Defendant Smithkline Beecham is a corporation organized under the laws of Pennsylvania. Id. at 1-2. The Defendants will hereafter be referred to as "SBC." The parties have stipulated that the amount in controversy is in excess of $50,000. (Answer to Amended Complaint at 2). This Court has jurisdiction over this matter pursuant to 28 U.S.C. § 1332.

The Amended Complaint, filed June 6, 1994, alleges that Defendants manufacture animal vaccines for ultimate sale to the public in the State of Illinois. (Amended Complaint at 3). Defendants deny that their animal vaccines were sold to various firms for distribution to the public, answering instead that the "vaccines in question were subject to use, evaluation and administration by veterinary physicians under the learned intermediary doctrine." (Answer to Amended Complaint at 4).

The vaccines at issue in this suit are *CattleMaster4 and Ultrabac7/Somubac. (Amended Complaint at 3, 11). The United States Department of Agriculture ("USDA") has licensed each of the vaccines, *CattleMaster4 under USDA License No. 1187.21 and Ultrabac7/Somubac under USDA License No. 4723.00. (Affidavit of Cyril G. Gay, D.V.M., Ph.D. at ¶¶ 3-9). Plaintiff contends that it purchased these vaccines from the Miller Company in Morton, Illinois. (Amended Complaint at 3, 11). According to the Amended Complaint, Plaintiff intended to use these vaccines on its cattle to prevent debilitating disease and/or mortal infection. Id. at 3, 12. Plaintiff alleges that notwithstanding its use of the vaccines, some of its cattle contracted debilitating disease and died. Id. at 4, 12-13. Other cattle had to be disposed of at a loss due to the extent of debilitations. Id. The Amended Complaint asserts that Plaintiff took all recommended precautions, including refrigerating the vaccines, and despite these actions the vaccines did not perform as they were intended. Id. at 4, 12. Plaintiff further asserts that these vaccines proximately caused the debilitation and death of its cattle. Id.

The Amended Complaint presents eight counts. In Counts I and VII, Plaintiff asserts that SBC is liable, under a strict liability theory, for the defective, dangerous, and inefficacious nature of *CattleMaster 4 and Ultrabac7/Somubac, respectively. Counts II and III contain allegations that SBC breached implied warranties of fitness for a particular purpose and merchantability under the Illinois Uniform Commercial Code, 810 ILCS 5/1-101, et seq. Count IV states a claim for fraudulent misrepresentation. Count V alleges that SBC violated the Illinois Consumer Fraud and Deceptive Business Practices Act, 815 ILCS 505/1, et seq., through the advertising and promotion of *CattleMaster4. In Counts VI and VII, Plaintiff contends that the *CattleMaster4 and Somubac vaccines were defective in that the product labeling on the vaccines failed to warn against certain alleged dangers arising out of their use.

Conclusions of Law

Summary judgment will be granted "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). Once the moving party has borne its burden of identifying those portions of the pleadings, answers to interrogatories, etc., that demonstrate there is no genuine issue of material fact, the nonmoving party must come forward with specific facts showing that there is a genuine issue for trial. Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586-87, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986). Where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no genuine issue for trial. Id. at 587, 106 S.Ct. at 1356 (citations omitted). When considering a motion for summary judgment, courts must give the benefit of all inferences to the party opposing the motion and examine the record in the light most favorable to that party. United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 994, 8 L.Ed.2d 176 (1962); Sarsha v. Sears, Roebuck & Co., 3 F.3d 1035, 1038 (7th Cir. 1993).

In this matter, the Court gives the benefit of all inferences to the Plaintiff, for purposes of the Motion for Summary Judgment, regarding Plaintiff's allegations that it purchased the vaccines, *CattleMaster4 and Ultrabac7/Somubac, for use on its cattle; that it properly utilized these vaccines; and that its cattle contracted debilitating disease and either died or had to be disposed of at a loss. All this being true, however, will not permit the Plaintiff to survive summary judgment if the Virus-Serum-Toxins Act ("VSTA") preempts Plaintiff's state common law and statutory claims.*fn1 In the event that this Court finds VSTA to preempt state law, Plaintiff, for all the injury sustained by it, will have no remedy at law.

The presumption against preemption, especially where the state law being usurped is a traditional state police power, is well established. California v. ARC America Corp., 490 U.S. 93, 100, 109 S.Ct. 1661, 1665, 104 L.Ed.2d 86 (1989); Maryland v. Louisiana, 451 U.S. 725, 746, 101 S.Ct. 2114, 2129, 68 L.Ed.2d 576 (1981) ("Consideration under the Supremacy Clause starts with the basic assumption that Congress did not intend to displace state law"); Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230, 67 S.Ct. 1146, 1152, 91 L.Ed. 1447 (1947) ("we start with the assumption that the historic police powers of the States were not to be superseded by the Federal Act unless that was the clear and manifest purpose of Congress") (citations omitted). The same presumption applies when an agency acts to preempt the field. Hillsborough County, Fla. v. Automated Medical Laboratories, Inc., 471 U.S. 707, 715, 105 S.Ct. 2371, 2376, 85 L.Ed.2d 714 (1985). In instances where agency preemption is alleged, however, a "narrow focus on Congress' intent to supersede state law [is] misdirected," as "[a] preemptive regulation's force does not depend on express congressional authority to displace state law." Fidelity Federal Sav. and Loan Ass'n v. de la Cuesta, 458 U.S. 141, 154, 102 S.Ct. 3014, 3023, 73 L.Ed.2d 664 (1982).

Congress may act to preempt state law in three ways. Express preemption exists where Congress has legislated in clear and unequivocal terms, found within the text of the statute, that an act preempts state law. See, e.g., Cipollone v. Liggett Group, Inc., ___ U.S. ___, ___ - ___, 112 S.Ct. 2608, 2617-20, 120 L.Ed.2d 407 (1992). Implied preemption may be found (1) where state law actually conflicts with an act of Congress, or (2) where federal legislation is so pervasive as to make reasonable the inference that Congress left no room for the States to supplement it. Hines v. Davidowitz, 312 U.S. 52, 67, 61 S.Ct. 399, 404, 85 L.Ed. 581 (1941). Finally, state law may be preempted by federal regulations, Hillsborough, supra, at 713, 105 S.Ct. at 2375, where a federal agency, acting within the scope of its congressionally delegated authority, acts to preempt state law. Fidelity Federal Sav. and Loan Ass'n v. de la Cuesta, 458 U.S. 141, 153-54, 102 S.Ct. 3014, 3022-23, 73 L.Ed.2d 664 (1982) (citations omitted); City of New York v. F.C.C., 486 U.S. 57, 63-64, 108 S.Ct. 1637, 1642, 100 L.Ed.2d 48 (1988) (citing Louisiana Public Service Com'n v. F.C.C., 476 U.S. 355, 367-71, 106 S.Ct. 1890, 1898-99, 90 L.Ed.2d 369 (1986)).*fn2

In the case at bar, Defendants have eschewed the express and implied preemption arguments, relying solely upon agency preemption to support its Motion for Summary Judgment. (Tr. of 2/24/95 Oral Argument at 3-4). Thus, this Court must determine first whether the agency which regulated cattle vaccines, APHIS, was acting within its congressionally delegated authority. City of New York, supra, at 63-64, 108 S.Ct. at 1641-42. Once this Court finds that APHIS was acting within its grant of authority, it must determine whether the language APHIS chose in promulgating its regulations is sufficiently broad to preempt each of Plaintiff's claims. Id. at 66, 108 S.Ct. at 1643.

Under VSTA, all animal vaccines sold in the United States, and all establishments at which animal vaccines are produced, must be licensed by the USDA. 21 U.S.C. § 154 (West Supp. 1994). Within USDA, licensure of animal vaccines and vaccine-producing establishments is regulated by the USDA's APHIS. 9 C.F.R. § 101.1, et seq. This Court finds that Congress has delegated broad authority to the USDA and APHIS to promulgate and enforce "such rules and regulations as may ...


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