January 31, 2008
Oregon Supreme Court Reaffirms $79.5 Punitive Damages Award in Williams
In an opinion issued today the Oregon Supreme Court reaffirmed a $79.5 million punitive damages award in Williams v. Philip Morris Inc., following remand by the Supreme Court in Philip Morris USA v. Williams, 127 S.Ct. 1057 (2007). This is what the Supreme Court of the United States said in its remand order:
As the preceding discussion makes clear, we believe that the Oregon Supreme Court applied the wrong constitutional standard when considering Philip Morris' appeal. We remand this case so that the Oregon Supreme Court can apply the standard we have set forth. Because the application of this standard may lead to the need for a new trial, or a change in the level of the punitive damages award, we shall not consider whether the award is constitutionally “grossly excessive.” We vacate the Oregon Supreme Court's judgment and remand the case for further proceedings not inconsistent with this opinion.
This is what the Oregon Supreme Court said in its opinion:
On remand, we are called upon to reconsider and reassess our earlier holding, which arose in the context of the trial court's refusal to give a particular proposed jury instruction that defendant had requested. Having reconsidered and reassessed the issue, we now conclude that the proposed jury instruction at issue here also was flawed for other reasons that we did not identify in our former opinion. We therefore reaffirm this court's prior conclusion that the trial court did not err in refusing to give the instruction. We otherwise reaffirm our prior opinion in all respects.
Gail Charnley's Qualifications for the Consumer Product Safety Commission
Dr. Gail Charnley is being considered as a potential replacement for Consumer Product Safety Commission chairman Nancy A. Nord, as noted in an earlier post. A short post doesn't give a full sense of qualifications. A full cv is attached if you're interested in a more detailed look at her background and qualifications.
January 30, 2008
Preemption of Prescription Drug Failure to Warn Claim Adds Emphasis to Supreme Court Term
A federal trial court in Okalahoma has concluded that a the claim of a widow, whose husband committed suicide while taking an anti-depressant medication, is preempted by federal law, Dobbs v. Wyeth Pharmaceuticals, 2008 WL 169021 (W.D. Okla.). Annabel Dobbs alleges that the drug maker Wyeth failed to warn adequately about the increased risk of suicide in patients like her husband taking its drug Effexor. The court ruled, however, that the Food & Drug Administration (FDA) had considered and rejected a warning about suicidality at the time Dobbs' husband used the drug. The court, citing the FDA's rule governing prescription drug labelling and its preamble in which the agency says that its rules are preemptive on the question of drug labelling content, said that the agency's position on preemption was entitled to considerable deference.
On the day following this decision, the U.S. Supreme Court agreed to hear Wyeth v. Levine, 2006 WL 3041078 (Vt. 2006, cert. granted 1/18/08, U.S. No. 06-1249), in which the Vermont Supreme Court ruled that federal law did not preempt a claim that a drug manufacturer should have warned about a particular method of administering a prescription drug for which the FDA had approved the label without such warning.
January 29, 2008
New York Court to Decide Defendant's Burden of Proof for Summary Judgment on "Defect" Question
The New York Court of Appeals will hear arguments in February in Ramos v. Howard Industries, Inc., to consider a manufacturer's burden of proof to establish in a motion for summary judgment that its product was not flawed or defectively designed in a case where the allegedly defective product was not available for examination. The plaintiff in the case, a lineman for Niagara Mohawk Power Corp., allegedly sustained injuries when a transformer the defendant designed and manufactured exploded. The plaintiff initially claimed that his injuries occurred when he reached out of an aerial bucket while installing the transformer on a utility pole, but later alleged that his injuries were the result of a transformer explosion. The transformer could not be located for inspecting or testing to determine the cause of its failure. The supreme court denied the defendant's motion for summary judgment and the appellate division affirmed. 831 N.Y.S.2d 615 (App. Div. 2007). In affirming the court noted that the defendant had "the burden of establishing as a matter of law that there was no defect in the design or manufacture of the transformer," and that the defendant cannot meet that burden simply by pointing to gaps in the plaintiff's proof. The defendant submitted evidence establishing that its transformers were designed according to Niagara Mohawk's specifications and under state of the art conditions, and that the transformer in question would have been individually tested to determine if it complied with customer specifications and industry standards. The court concluded that the evidence did "not establish as a matter of law that the transformer was not defective and that a manufacturing defect therefore did not cause the explosion." Judge Peradotto dissented, concluding that the defendant's evidence was sufficient to support its motion. In his view, "a defendant in a manufacturing defect case in which the product is unavailable for inspection and testing must establish as a matter of law that it may be inferred from the evidence that the product was not defective when it left the defendant's control and that there are other possible causes of the accident not attributable to the defendant." He thought the standard was met, given the defendant's evidence of quality control and of other potential causes, including rewiring of the transformer after it left the defendant's hands, and the possibility that the transformer had been rebuilt. That evidence, coupled with a lack of rebuttal evidence by the plaintiff, justified granting the motion, according to Judge Peradotto.
White House Considering Consumer Product Safety Commission Candidates
Annys Shin reported in the Washington Post Saturday that the White House is considering Gail Charnley to replace Nancy A. Nord as chairman of the Consumer Product Safety Commission. Charnley, who has a doctorate in toxicology from MIT, has a consulting firm, HealthRisk Strategies. She has been been a member of several high-level government advisory panels and was the director of an NAS toxicology program in the mid-1990s.
January 24, 2008
Suicide Studies in Drug Trials Required by FDA
Gardiner Harris writes in today's New York Times that The FDA is now requiring drug companies to study closely the impact of the drugs on patients during clinical trials, and that "[t]he new rules represent one of the most profound changes of the past 16 years to regulations governing drug development." The agency's shift has not been announced publicly because the F.D.A.’s oversight of experimental medicines is done in secret.
Benzene Exposure Failure-to-warn Claim Preempted by OSHA Regulations
A Minnesota DIstrict Court dismissed a wrongful death action brought by the family of a former industrial worker against the makers of benzene-containing products to which he was allegedly exposed in his workplace. OSHA regulations that govern warning and labeling requirements for hazardous chemicals used in the workplace preempt any additional state law requirements, according to the court. Thus, the only way the plaintiffs could show liability for failing to warn was to show that the manufacturers violated the OSHA regulation requiring warnings be given for products containing more than 0.1% benzene. Because the plaintiffs produced no evidence that the defendants violated the regulation, the court ruled that the companies were entitled to summary judgment in their favor. Vettrus v. Ashland, Inc., Minn. Dist. Ct., No. C9-04-817, Jan. 9, 2008).
January 20, 2008
New Preemption Articles
There are two new articles covering preemption in products liability cases that should be of particular interest in light of the Supreme Court's decision last week to grant review in two preemption cases.
Professor Catherine M. Sharkey of the New York University School of Law has posted a new article, "Products Liability Preemption: An Institutional Approach to be published in a forthcoming issue of volume 76 George Washington Law Review. Given the Supreme Court's reliance on agency preemption determinations, and its sometimes cryptic explanations for that reliance, Professor Sharkey advances a new “agency reference model” to fill the doctrinal gap, which is intended to provide not only a lens for viewing the Court's past decisions but also a prescriptive approach for future cases.
A second article, "The Emerging Threat of Regulatory Preemption," a White Paper by David C. Vladeck, Professor of Law, Georgetown University Law Center, and Scholar, Center for Progressive Reform, was recently published in the American Constitution Society for Law and Policy. It takes the position "that agencies are making substantive preemption determinations in a way that is neither transparent nor democratic, and are doing so because the Administration has determined that insulating big business from tort litigation is right as a matter of federal policy." The article is intended to illustrate "that this campaign is well-underway," and that it raises serious policy implications, and second, "to explain why making preemption determinations by regulatory fiat raises serious separation of powers and agency capture concerns."
January 18, 2008
Supreme Court Grants Review in Vermont Supreme Court Preemption Case
The Supreme Court granted review on January 18 in Wyeth v. Levine, --- S.Ct. ----, 75 USLW 3500, 76 USLW 3018 (U.S.Vt. Jan 18, 2008) (NO. 06-1249) of the Vermont Supreme Court's decision in Levine v. Wyeth, --- A.2d ----, 2006 WL 3041078 (Vt. Oct. 27, 2006). The plaintiff in the case suffered severe injury and the amputation of her arm as a result of being injected with defendant's drug Phenergan, a nausea medication. She claimed at trial that Wyeth was negligent and failed to provide adequate warnings of the known dangers of injecting Phenergan directly into a patient's vein. Wyeth argued that the trial court should not have permitted the jury to consider plaintiff's claims because they conflicted with Wyeth's obligations under federal law regulating prescription drug labels. The trial court permitted the case to go to the jury, which found for the plaintiff on both the negligence and products liability claims and awarded her $2.4 million in economic damages and $5 million in non-economic damages, which after adjustments, was reduced pursuant to the parties' stipulation to a total of $6,774,000. Wyeth argued on appeal that the warning claim conflicted with the warning label approved by the Food and Drug Administration. The Vermont Supreme Court affirmed the judgment for the plaintiff, holding that there was no conflict between state and federal law requiring preemption of the plainiff's claim.
Supreme Court Grants Review in Light Cigarette Preemption Case
The Supreme Court granted review today in Altria Group v. Good. The plaintiffs in the case alleged that they smoked Marlboro Lights for at least fifteen years. They sued Philip Morris USA, Inc. and its parent company, Altria Group, Inc., claiming that "Philip Morris has employed unfair and deceptive practices in "designing, manufacturing, promoting, marketing and selling Marlboro Lights and Cambridge Lights purporting to be ‘light’ and having ‘Lowered Tar and Nicotine,’ all while [it] knew those cigarettes would not deliver less tar or nicotine to the consumer.” They claimed that these misrepresentations constituted unfair or deceptive acts or practices in violation of the Maine Unfair Trade Practices Act, Me.Rev.Stat. Ann. tit. 5, § 207 (2002), which entitles any person who suffers a loss of money or property as a result of such acts or practices to sue for “actual damages, restitution and for ... other equitable relief.” Id. § 213(1). The plaintiffs in the case have expressly disclaimed any “damages for personal injuries.” They seek other relief, however, including the return of the sums they paid to purchase Marlboro Lights and Cambridge Lights. They also seek punitive damages and the attorneys' fees as authorized by the Act. The plaintiffs also seek to certify a class of all purchasers of Marlboro Lights or Cambridge Lights in Maine through November 2002. The District Court for the District of Maine granted summary judgment in favor of Philip Morris. The plaintiffs appealed and the First Circuit reversed in Good v. Altria Group, Inc., 501 F.3d 29 (1st Cir. 2007), concluding that the plaintiffs' claims were not preempted by the Federal Cigarette Labeling and Advertising Act and were not barred by the Maine statutory exemption for transactions or actions otherwise permitted by federal law. The decision conflicts with the Fifth Circuit's decision in Brown v. Brown & Williamson Tobacco Corp., 479 F.3d 383 (5th Cir. 2007). There are other light cigarette cases pending throughout the country. [read more]
January 17, 2008
Minnesota Bridge Collapse Result of Design Flaw?
A National Transportation Safety Board's (NTSB) investigation has preliminarily concluded that the August 1, 2007 collapse of the Interstate-35W bridge in Minneapolis, Minnesota into the Mississippi River was due to a flaw in the bridge's original design and that there were no indications that faulty inspections or maintenance played a role. The bridge collapsed during rush hour on August 1, 2007, involving about 100 cars and resulting 13 deaths and 145 additional injuries. The report concluded that steel gussest plates joining the steel girders were too thin - a half-inch thick instead of an inch thick. NTSB Chairman Mark Rosenker's announcement of the agency's findings thus far also emphasized that the investigation will not be complete for several months and that the findings are by no means final. His report was immediately critisized by lawyers for many of the victims as well as others.
If NTSB's report of the cause turns out to be correct, it appears that the state and its transportation agency may be off the liability hook. In any event, the state and its agencies have fairly broad statutory immunity from liaibility for discretionary activities made at the planning level. Moreover, the state's liability is capped at $1 million for any number of claims arising out of a single accident under the statute that allows tort claims against the state. Lawsuits against private parties, including the engineering firm that designed the bridge, face a substantial obstacle in the form of Minnesota's ten-year statute of repose for actions to recover for personal injury, wrongful death, or property damages arising out of the design, construction, or maintenance of an improvement to real property. The bridge was designed and built more than 40 years ago.
January 13, 2008
Hunting Tree Stand Manufacturer Agrees To Pay $420,000 Civil Penalt
The U.S. Consumer Product Safety Commission (CPSC) announced in a release on January 10 that a Wisconsin-based tree stand manufacturer, Ardisam Inc., of Cumberland, Wisconsin, has agreed to pay the government a $420,000 civil penalty. The penalty settles a government lawsuit brought by the Office of Consumer Litigation of the U.S. Department of Justice in the U.S. District Court for the Western District of Wisconsin on behalf of the CPSC, alleging that the company failed to immediately report to the CPSC serious injuries to hunters with its Big Foot and Lite Foot series hunting tree stands. The company recalled 78,000 of the tree stands in July 2004. In the CPSC release Acting Chairman Nancy Nord said "The law is clear – companies must immediately tell CPSC about products that could pose a substantial risk or create an unreasonable risk of serious injury or death," and "[t]he quicker a company tells CPSC about a dangerous product, the quicker we can work to protect the health and safety of consumers." Ardisam denied the allegations that it violated federal law or failed to immediately report to the CPSC in settling the lawsuit.
January 11, 2008
Florida Supreme Court Deadline for Smokers' Suits is Today
In Engle v. Liggett Group, Inc., 945 So.2d 1246 (Fla. 2006), the Supreme Court of Florida overturned a $145 billion punitive damages verdict against cigarette makers, decertifying a class action, but upholding jury findings that the companies were negligent and sold defective products. Those findings will apply in the individual cases. The filing deadline for individual cases is today. Plainiffs' lawyers expct that the total number of claims could reach 10,000. [read more]
January 10, 2008
Tennesseee Supreme Court Hears Arguments in Mesothelioma Case Based on Second-Hand Exposure to Asbestos
The Tennessee Supreme Court heard arguments on January 8 in a case that will decide whether Alcoa Inc. is responsible for the asbestos-related death of a former worker's daughter who contracted mesothelioma because of second-hand exposure to asbestos dust brought home by her father. The Tennessee Court of Appeals held in Satterfield v. Breeding Insulation Co., Inc., 2007 WL 1159416 (Tenn.Ct.App. April 19, 2007), that Alcoa owed a duty to the plaintiff and remanded the case to the district court. The Tennessee Supreme Court is expected to rule on the case in April. Alcoa raised the potential for unlimited liability in its argument before the supreme court. The court of appeals relied on cases from other jurisdictions in rejecting the unlimited liablity argument. The case contains a good summary of the recent law in the area. [read more]
January 8, 2008
Nancy Nord Emphasizes Retail Safety in National Press Club Speech
• The News: The CPSC may increase scrutiny of retailers and require them to test products they sell to certify their safety.
• The Background: The agency has focused primarily on product manufacturers but cited an increase in products made abroad for the shift.
• The Plan: The CPSC expects to expand inspection of imported goods using new funds appropriated by Congress.Ms. Nord, speaking at the National Press Club in Washington, said the agency will focus additional attention on retailers if pending product-safety legislation before Congress passes, requiring retailers to make sure that products they sell are tested and certified for safety because they, along with manufacturers, bear the legal responsibility for the safety of products they sell.
January 6, 2008
Chinese Product Safety Progress
An International Herald Tribune article notes that in China, a four-month product safety initiative, which was part crackdown and part public relations drive, ended in December. The initiative was in response to a variety of problems with Chinese products, including millions of recalled products in several countries over lead pain and other concerns with Chinese-manufactured products. The article notes that "experts say China has taken significant steps toward addressing product quality and safety problems," but that there is also a "risk of backsliding in a country with a convoluted bureaucracy and a well-documented history of local leaders ignoring edicts from the top." Even though the high-profile campaign is over, the Chinese government continues to work on several fronts, including the development of China's first-ever food safety law.
January 4, 2008
FDA to Clear Cloned Livestock
A Wall Street Journal article by Jane Zhang, John W. Miller and Lauren Etter notes that the FDA is expected to declare as early as next week that milk and meat from cloned animals and their offspring are safe for consumption. The article notes that "[c]onsumer wariness toward cloned food may lead to a backlash from opponents in Congress and other markets, such as the European Union, who are concerned that not enough data are available for a viable study on the safety of the products, and that "[t]here are also ethical worries because cloned animals tend to have more health problems at birth than conventionally bred animals." The FDA's action will be followed closely internationally. The European Food Safety Authority, the EU version of the FDA, is expected to deliver an initial assessment on the issue next week, although a final decsion is not expected for month. EU regulators and consumers are not likely to respond favorably to the idea of consuming cloned animals and their offspring.
January 3, 2008
Seventh Circuit Affirms Judgment in Second Trial for Crane Rebuilder
Mesman v. Pro Crane Services, Inc., 2008 WL 36168 (7th Cir. 2008), decided January 2, was before the Seventh Circuit for a second time after the court had previously affirmed the district court's order for a new trial, 409 F.3d 846 (7th Cir.2005). In a sometimes caustic opinion Judge Posner utilized the Hand formula in explaining the court's decision to affirm the judgment for the defendant in the second trial. The plaintiff in the case was seriously injured while working for his employer, Infra-Metals, "when a load of steel sheets that he was unloading from a boxcar fell on him from the crane that was lifting the sheets out of the boxcar." He sued Konecranes, the company that had rebuilt the fifty-year-old crane. The redesign of the crane created the potential for loads falling from the crane if it hit the cab of the crane, which Infra-Metals wanted left in its original location attached to a ceiling beam in case it wanted the crane operated from the cab rather than from the remote control device it installed which permitted an operator to operate the crane from the ground. The remote was equipped with an emergency stop button that would have avoided the accident, had the operator pressed it. Instead, the operator pressed the down button, reversing the direction of the crane, but not in time to prevent the load from hitting the can and falling on the plaintiff. The defendant prevailed on the retrial and the plaintiff appealed. The court held that the Indiana Products Liability Act, Ind. Code § 34-20-2-2, which makes a design defect actionable only if there is negligence in the design, applied to Konecranes. While the court thought that it was error for the magistrate judge in the case to permit Konecranes to argue that it was not responsible under the Act for the cab's location because it had not manufactured the crane but only repaired it, because the Act does apply to rebuildling. Excerpts from the opinion follow:
But the error in allowing the jury to speculate on how far Konecranes' decision to rebuild was subject to the products liability act was inconsequential, because the plaintiffs were permitted to claim common law negligence, as they had not previously bothered to do. There is no difference, except possibly with respect to the “open and obvious” defense, that is material to this case between common law negligence and negligence under the products liability statute; and we shall see that the “open and obvious” defense turned out not to play a significant role in the second trial.
Mesman complains about the magistrate judge's refusal to instruct the jury on the Learned Hand negligence formula. This could not be an error, because the judge gave the standard Indiana pattern instruction on negligence, a correct statement of Indiana law that a federal court in a diversity suit is bound by. In any event, the instruction the plaintiffs wanted the judge to give was not the Hand formula, but a garbled version of it: “If you find that in renovating the crane the defendant failed to take effective precautions less expensive than the damages which could reasonably be expected to result from the crane's foreseeable use or misuse, then you may find the defendant negligent. Even if you determine that the particular failure which occurred was not likely to occur, you may still find the defendant liable if the costs of preventing the harm were lower than the costs of a reasonably foreseeable injury.” The Hand formula requires, as we have seen, discounting (multiplying) the harm if an accident should occur by the probability that it would occur unless a precaution were taken, and then comparing the product of that multiplication to the cost of the precaution. Thus, if the harm from the accident would be very great and the cost of preventing it very low, the defendant might be negligent even if the probability of the accident was also low. That may be this case. Suppose the probability ( P in Hand's formula) were .001, the loss if the accident occurred ( L ) $1 million, and the cost of avoiding the accident ( B, for burden of precaution) $500. Then because $500 is less than $1 million x .001 (=$1,000), the injurer would be adjudged negligent. (The numbers in the example are merely illustrative, of course.) But this was not what the proposed instruction would have directed the jury to consider.
The failure to give the garbled instruction cannot have been a plain error since it was not an error at all; and it would have had to be a plain error to get the plaintiffs a new trial, since their lawyer failed to object to the judge's refusal to give the instruction. (That he failed to object is conceded, though there is no record of the instructions conference because the magistrate judge unwisely conducted it off the record. . .) . . . In the absence of extraordinary circumstances, a lawyer should not be heard to request a third jury trial on the basis of an instruction (or a failure to instruct) to which he failed to object.
CPSC Announces Recall of Chinese-Manufactured Wagons Because of Excessive Lead Levels in the Paint
The Consumer Product Safety Commission announced the first voluntary recall of the year of a Chinese-manufactured toy, this time a metal toy wagon. About 15,000 of the units, red metal wagon model MH1250, were recalled by Tricam Industries because of excessive lead levels in the paint on the wagon. The wagons were sold at Tractor Supply Company stores nationwide from September 2002 through November 2007, for about $30. No incidents or injuries were reported.
January 2, 2008
CPSC Announces First Recall of New Year
The Consumer Product Safety Commission announced the first voluntary recall of the new year today. KYMCO Co. recalled all model year 2006-2008 MXU 500 ATVs. The recall included 1,350 units. The hazard statement was that "[t]he pivot bolts holding the rear suspension onto the frame can become loose, causing the rear swing arm to detach from the chassis posing a risk of injury or death to the operator." KYMCO received six reports of incidents, including two minor injuries.
"Dubious Data Awards" from STATS
A consumeraffairs.com article notes the year's "Dubious Data Awards" from STATS (non-profit Statistical Assessment Service), which is affiliated with George Mason University. It "highlights the top-ten abuses of science and statistics in the media," according to Don Rieck, STATS spokesperson. The intent of STATS is to "correct scientific misinformation in the media resulting from bad science, politics, or a simple lack of information or knowledge." An example from the article is the "Battle of the Bottles":
Reacting to media reports in the San Francisco Chronicle and elsewhere, San Francisco Mayor Gavin Newsome banned plastic water bottles because they contained “toxic” phthalates. What the Mayor and the media missed was that plastic bottles are made with a different chemical that happens to have a similar sounding name -- polyethylene terephthalate, which STATS said is a harmless polyester.