The U.S. Court of Appeals for the Second Circuit has resurrected a class action lawsuit filed by Pfizer Inc. shareholders who allege the drug maker misled them about certain pain-relieving drugs and, in turn, cost them billions.

In its April 12 decision, the federal appeals court vacated the judgment of the U.S. District Court for the Southern District of New York.

The three-judge panel concluded the district court’s rationales for excluding the plaintiffs’ expert on loss causation and damages — Daniel Fischel, a former University of Chicago Law School dean — were “inadequate to justify excluding it in its entirety.”

The Second Circuit, in its 63-page opinion, also concluded that the district court erred in its earlier summary judgment ruling that no reasonable jury could find Pfizer liable for certain statements made by companies that owned the drugs before Pfizer, including G.D. Searle & Co. and Pharmacia Corp.

“Plaintiffs’ evidence of Pfizer’s authority over the eight statements by Searle and Pharmacia employees to various newspaper and journal articles fares slightly better, however,” the panel wrote. “In broad terms, the eight statements all conveyed that there were no increased cardiovascular risks associated with Celebrex.

“To be clear, there is no dispute that Searle and Pharmacia employees, not Pfizer employees, actually delivered the statements to the press. Nor is there any evidence that these employees held themselves out as representing Pfizer. And ‘in the ordinary case,’ the fact that the statements were attributed to Searle or Pharmacia employees ‘is… strong evidence that [the] statement[s] w[ere] made by — and only by — the party to whom [they were] attributed.’”

The panel continued, “Nevertheless, we find that there is a material question of fact whether the present case deviates from the ordinary case. Notwithstanding that the eight statements to the press were attributed to Searle and Pharmacia employees, Plaintiffs have presented sufficient evidence to permit a reasonable jury to conclude that Pfizer had ‘ultimate authority’ over the statements’ ‘content and whether and how to communicate’ them.”

The shareholders, who filed their lawsuit in 2004, allege Pfizer concealed the risks associated with Celebrex and Bextra. Both are considered nonsteroidal anti-inflammatory drugs, used to treat chronic pain and inflammation.

The class, which includes investors who bought Pfizer stock between Oct. 31, 2000 and Oct. 19, 2005, alleges that when the market eventually learned of the risks associated with the two drugs, the value of Pfizer’s shares fell by about $70 billion.

Bextra was available by prescription up until 2005, when the Food and Drug Administration requested Pfizer withdraw the drug from the U.S. market. The FDA cited “potential increased risk for serious cardiovascular (CV) adverse events” and an “increased risk of serious skin reactions,” among other things.

The drug maker agreed to suspend sales and marketing of Bextra, but said it disagreed with the FDA’s view of the drug’s risks and benefits.

In September 2009, Pfizer also agreed to pay $2.3 billion to resolve an investigation by the U.S. Department of Justice into the illegal promotion of certain pharmaceuticals, including Bextra.

The FDA allowed Celebrex, closely related to Bextra, to remain on the market; however, it now includes strict warnings about the risk of heart attacks and strokes.

The shareholders’ lawsuit, as result of the Second Circuit’s decision, now returns to the Southern District of New York.

Pfizer said in a statement it has “appropriately communicated accurate and science-based information about its medicines to investors and the public at all times.”

It said it plans to defend the case “vigorously.”