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Business Associations Keyed to Coffee, 9th Ed.
Matrixx Initiatives v. Siracusano
Citation:
131 S.Ct. 1309, 563 U.S. 27, 179 L.Ed.2d 398 (2011)Facts
Matrixx Initiatives developed and marketed over-the-counter pharmaceutical products, with its core brand being Zicam Cold Remedy, which accounted for approximately 70% of the company’s sales. Between 1999 and 2004, Matrixx received several reports from medical professionals suggesting a possible link between Zicam nasal gel and anosmia (loss of smell). Dr. Alan Hirsch called Matrixx in 1999 after discovering a possible link in his patients. In 2002, Timothy Clarot, Matrixx’s VP of research, was informed by Dr. Linschoten about previous studies linking zinc to loss of smell. By September 2003, Dr. Jafek had observed 10 patients suffering from anosmia after Zicam use and planned to present these findings at a medical conference. Matrixx attempted to prevent this presentation. During this period, multiple product liability lawsuits were filed against Matrixx. Despite these reports, Matrixx made optimistic public statements about Zicam’s growth potential and denied any causal connection between Zicam and anosmia. After a news report about the FDA investigating these complaints, Matrixx’s stock price dropped significantly, prompting the company to issue misleading press releases claiming the allegations were “completely unfounded.”
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