TortsProf Blog

Schwartz, Goldberg & Silverman on Brand Name Drug Manufacturers Liability for Generics

Victor Schwartz, Phil Goldberg and Cary Silverman (Shook Hardy & Bacon) recently published Warning: Shifting Liability to Manufacturers of Brand-Name Medicines When the Harm Was Allegedly Caused by Generic Drug Has Severe Side Effects in Fordham Law Review.  The abstract provides:

Can a product manufacturer be subject to liability for a competitor’s product? American tort law has always said, “No.” It does not matter if the products are identical. Companies are not to be their competitors’ keepers.

Nevertheless, over the past few years, three courts have overturned this fundamental of tort law, holding that a manufacturer of a brand-name prescription drug can be subject to liability even when a plaintiff alleges that he or she was harmed by a generic drug made by the brand-name manufacturer’s competitor. Most courts, including four federal courts of appeal and dozens of federal district and state trial courts, have rejected this expansion of tort law.

This debate has intensified since 2011, when the Supreme Court of the United States held that all duty to warn claims against manufacturers of generic drugs are preempted by federal drug. The personal injury bar is hoping that courts will give competitor liability theories a new look, particularly when courts find that there is no other path for users of generic drugs to sue.

This Article explains the reasons courts should continue resisting any temptation to change state tort law to allow for competitor liability: (1) it is driven by a search for pockets for paying claims in violation of fundamental tort law principles; (2) the overwhelming majority of courts have continued rejecting competitor liability, even since the Supreme Court ruling; and (3) shifting liability to manufacturers of brand-name drugs could have significant adverse legal and health care consequences. 

- SBS

Sudden Unintended Acceleration Claims Filed Against Ford

The National Law Journal reports that consumers have filed economic loss claims against Ford based on the risk of sudden unintended acceleration.  The national class action has been filed in federal court in West Virginia.  Unsurprisingly, the claims exclude potential personal injury or wrongful death claims. Rather, the claims sound in contract and include Magnuson-Moss, state warranty, consumer protection and unfair trade practices claims.  The full article is behind a free registration wall.

I have written about these risk-based claims in Against Liability for Private Risk-Exposure.

- SBS

Daniel Cummins: "A Maze of Uncertainty: PA Products Liability Law Remains in a Confusing State of Flux"

          As of the writing of this article in January of 2013, confusion is reigning in the Commonwealth of Pennsylvania on the uncertain issue of whether the Restatement (Second) of Torts or the different analysis set forth in the Restatement (Third) of Torts should be utilized in Pennsylvania products liability cases.  This uncertainty is the result of an ever-growing split of authority not only between the Pennsylvania state and federal courts, but also among, and even within, the different federal district courts across the Commonwealth.

          The situation has now spiraled downward to the point that litigants with cases pending in the Pennsylvania federal court system have to research whether the particular federal district court judge presiding over the case has previously issued a decision on the issue in order to determine which Restatement standard will be applied in that case.   While one Pennsylvania federal court judge has politely noted that this area of the law in Pennsylvania is in a “state of flux,”[1]   See Sikkelee v. Precision Automotive, Inc., 876 F. Supp. 2d 479, 489 (M.D. Pa. 2012 Jones, J.). another has more aptly described Pennsylvania products liability law as being “a maze of uncertainty.”[2]  See Samson v. Crown Equipment, 2:10-CV-0958, 2012 WL 3027989 (W.D. Pa. 2012 Hornak, J.). 

          Which standard is applied could make or break a case.  Although the Restatement (Second) favors strict liability concepts over negligence principles in the products liability context, the Restatement (Third) decreases the impact of concepts such as "intended use" and "intended user" and places a greater emphasis on the negligence principle of "reasonable foreseeability."   All of these changes in the Restatement (Third) arguably shift the balance in favor of manufacturer defendants in personal injury cases based upon allegations that a defective product was the cause of the injury.

          As noted below, under the current status of Pennsylvania products liability law, whether the case will be governed by the Restatement (Second) of Torts or the Restatement (Third) of Torts depends upon whether the case is in state or federal court, and if the case is in federal court, the answer may further depend upon which particular federal district court judge is presiding over the case.

The Restatement (Second) of Torts § 402A Standard

          It is safe to say that most Pennsylvania lawyers now practicing law now were trained on products liability issues in law school through a detailed study of the parameters of Section 402A of the Restatement (Second) of Torts.  This section of the Restatement (Second) of Torts, which first came back into play in 1965, provides, in pertinent part, that “[o]ne who sells any product in a defective condition unreasonably dangerous to the user or consumer” may be held strictly liable to the injured party even if the “seller has exercised all possible care in the preparation and sale of this product.”[3]  Restatement (Second) of Torts § 402A (1965).

          At the time it was published, Section 402A of the Restatement (Second) of Torts codified a new strict liability cause of action against manufacturers to be considered in addition to the other previously viable causes of action, such as negligence and breach of warranty.  Section 402A also expanded the scope of possible liable parties to also include all sellers in the distribution process related to the dissemination of the product to the public at large.

          The Pennsylvania Supreme Court has consistently applied Section 402A of the Restatement (Second) of Torts to Pennsylvania products liability cases since its 1966 decision in the case of Webb v. Zern.[4]  See Arthur L. Bugay & Craig L. Bazarsky, The Future of Pennsylvania Products Liability as Applied by Federal and State Courts: Covell v. Bell Sports, Inc.  Volume LXXXIII, No. 4 The PA Bar Assoc. Quarterly p. 139, 140 (October 2012) citing  Webb v. Zern, 220 A.2d 853 (Pa.). 

          Under the Restatement (Second) of Torts analysis, manufacturer defendants are held to be strictly liable for any manufacturing defects in their products.  With regards to design defect claims, since approximately 1984, the Pennsylvania courts have used a risk-utility analysis to initially determine, as a matter of law, whether a product may be considered by the jury to be defective. [5]  Bugay, supra at p. 143 citing with “See” signal Daumbacher v. Mallis, 485 A.2d 423, n. 6 (Pa.Super. 1984) and Surace v. Caterpillar, Inc. 111 F.2d 1039 (3d Cir. 1997).

          If the case makes it beyond this threshold finding, the matter will be permitted to proceed to the jury for a determination as to whether a product’s design was defective and the cause of the injury alleged.[6]  Id.

The Restatement (Third) of Torts § 2 Standard

          The Restatement (Third) of Torts was published in 1998.[7] Id.   Under Section 2 of the Restatement (Third) of Torts, recognized product defects that may subject a defendant to liability include manufacturing defects, design defects, and failure to warn defects.[8]  Id. [Citations omitted].

          In Section 2 of the Restatement (Third) of Torts, the definition of a manufacturing defect is essentially identical to that contained in the Restatement (Second), i.e., strict liability is owed to the injured party for any injuries caused by a manufacturing defect of the product.[9]  Id.

          However, in contrast to the principles espoused under the Restatement (Second) of Torts, claims asserting a design defect or a failure to warn are to be analyzed with reference to negligence principles and concepts delineated under the Restatement (Third) of Torts.[10]  Id.

          For example, under design defect cases governed by the Restatement (Third) of Torts, the strict liability analysis is altered by the inclusion of negligence-based principles, including consideration of the viability of a “reasonable alternative design.”[11]  Id. citing Restatement (Third) of Torts § 2 (1998). More specifically, the Restatement (Third) of Torts: Products Liability, § 2(b) states, in pertinent part, that a product is defective in design when the foreseeable risks of harm posed by the product could have been reduced or avoided by the adoption of a reasonable alternative design by the seller or other distributor, or a predecessor in the commercial chain of distribution, and that the omission of the alternative design renders the product not reasonably safe.

          Stated otherwise, while the analysis of design defect cases under the Restatement (Second) of Torts focuses on the actual design of the product, the basis for liability under the Restatement (Third) of Torts in this context includes a consideration of the reasonableness of the defendant’s conduct.[12]   Bugay supra at p. 144.  Essentially, while Restatement (Second) standard focuses on an intended user making an intended use of the product, the Restatement (Third) places the emphasis of the analysis on the foreseeable risks of harm and whether an alternative design could have minimized or eliminated that risk.[13]  Hoffman v. Paper Converting Mach. Co., 694 F. Supp. 2d 359, 365 (E.D. Pa. 2010).

          Another difference with the Restatement (Third) of Torts in the products liability context is that, under Restatement (Third) analysis, the plaintiff’s own acts or omissions, i.e., contributory negligence, are made an important part of the analysis of whether or not a product should be determined to be defectively designed.[14]  Id.

          Overall, with the movement away from strict liability towards a more negligence-based analysis in the Restatement (Third) of Torts, it would appear that most defendants in products cases would advocate for the adoption and application of the Restatement (Third) standard.   In contrast, most plaintiffs would likely favor the strict liability analysis under the Restatement (Second). 

          It should be noted, however, that the emphasis in the Restatement (Second) that the plaintiff be an intended user of the product serves to bar any recovery to bystanders injured by a product thereby making the Restatement (Third) a more favorable standard for that particular class of plaintiffs.

          Overall, there can be no dispute that, with the substantive differences between the two standards, the decision on which standard should be applied could have a significant impact on the admissibility of evidence and, consequently, the outcome of particular products liability cases.

How The Split of Authority Developed

          Pennsylvania courts, up until recently, have consistently followed the doctrine of stare decisis and have applied the Restatement (Second) of Torts analysis in products liability cases since as far back as 1966.  However, a recent slew of federal court decisions attempting to predict which Restatement of Torts the Pennsylvania Supreme Court would adopt if presented with the issue again has left this area of the law filled with unfortunate uncertainty and confusion.

          These efforts by the federal courts to predict how the Pennsylvania Supreme Court would address the Restatement (Second) versus the Restatement (Third) issue may have been borne out of signals from the Pennsylvania Supreme Court itself that perhaps the time has come to consider Restatement (Third) of Torts products liability standard as the law of the land.

          For example, as far back as 2003, Pennsylvania Supreme Court Justice Thomas G. Saylor, in his concurring opinion in the case of Phillips v. Cricket Lighters,[15] 841 A.2d 1000 (Pa. 2003). criticized the “ambiguities and inconsistencies” that had arisen in recent times with the Restatement (Second) analysis and stated that Pennsylvania’s products liability law “demonstrate[d] a compelling need for consideration of reasoned alternatives, such as are reflected in the position of the Third Restatement.”[16] Id. at 1000 [bracket inserted here].

          Yet, through at least 2008, the Pennsylvania Superior Court and the Pennsylvania Supreme Court had repeatedly rejected requests for the adoption of the Restatement (Third) analysis in several products liability cases.[17]  Bugay supra at p. 146-147 citing with “See” signal DeSantis v. Frick Co.,745 A.2d 624 (Pa. Super. 1999);  Phillips v. Cricket Lighters, supra, and with “See also” signal Bugosh v. I.U. N.A., Inc., 942 A.2d 897 (Pa. 2008). 

          Then in 2008, the Pennsylvania Supreme Court agreed to hear the appeal in the case of Bugosh v. I.U. North America, Inc. to specifically address the issue of whether the Restatement (Third) of Torts should be adopted in the products liability context.[18]  942 A.2d 897 (Pa. 2008) The Superior Court in Bugosh had refused to overrule “established authority” supporting the application of the Restatement (Second) and rejected the defendant’s assertion that the Restatement (Third) should be adopted.

          While this issue was pending before the Pennsylvania Supreme Court in Bugosh, but not yet decided, the same issue came before the United States Third Circuit Court of Appeals in the case of Berrier v. Simplicity Manufacturing, Inc.[19]  Bugay supra at p. 140 citing Berrier, 563 F.3d 38 (3d Cir. 2009).  The Third Circuit Court of Appeals boldly predicted in Berrier that the time had come where the Pennsylvania Supreme Court would indeed adopt the Restatement (Third) of Torts as the new standard to apply in products cases.[20]  Berrier, 563 F.3d at 53-54.

          However, in June of 2009, the Pennsylvania Supreme Court dismissed the appeal in the Bugosh case as improvidently granted and never reached the issue of whether or not to adopt the Restatement (Third) of Torts.[21]  971 A.2d 1228, 1229 (Pa. 2009).  In that decision to dismiss the appeal, Justice Saylor again voiced his desire to adopt the Restatement (Third) in a lengthy and strongly worded dissent.[22]  Id. at 1241 (Saylor, J., dissenting).

          The prediction by the Third Circuit Court of Appeals in Berrier followed by the dismissal of the appeal in Bugosh created confusion amongst the Pennsylvania federal district court judges who faced the same issue thereafter.[23]  Bugay supra at p. 148. After Bugosh, federal district court judges across the Commonwealth of Pennsylvania, with some of them even from the same district court bench, began to diverge on the question of which Restatement to follow. 

          Then, in its more recent decision in 2011 on the issue in the case of Covell v. Bell Sports, Inc.,[24]  651 F.3d 357, 365 (3d Cir. 2011) the Third Circuit again predicted that the Pennsylvania Supreme Court would adopt the Restatement (Third) if squarely faced with the issue.  The Third Circuit seemed to stand fast to this position again in a footnote contained in its denial of an appeal in the case of Sikkelee v. Precision Automotive.[25]   See 2012 WL 5077571 (3d Cir. 2012).  Since the issuance of the Covell decision by the Third Circuit Court of Appeals reiterating this prediction, the lower federal courts have continued to issue conflicting decisions on which Restatement analysis to apply in products cases.

          In 2011, the Pennsylvania Supreme Court issued its decision in Schmidt v. Boardman Co.,[26] 11 A.3d 924 (Pa. 2011) in which the court acknowledged that “foundational problems” existed in Pennsylvania products liability law based upon the Restatement (Second) of Torts.[27]  11 A.3d at 940–41.  However, the court noted that the case before it was not selected to address those “foundational concerns.”[28]  Id.   As such, the debate was not concluded in that case. 

          Yet, a study of the jurisprudence on this issue reveals that, in 2012, the Pennsylvania Supreme Court did have another opportunity to address the issue in the case of Beard v. Johnson & Johnson, Inc.[29]   41 A.3d 823 (Pa. 2012);  see also Schmidt v. Boardman Co., 608 Pa. 327, 11 A.3d 924, 941 (Pa.2011) (“Notwithstanding the Third Circuit's prediction, however, the present status quo in Pennsylvania entails the continued application of Section 402A of the Restatement Second, subject to the admonition that there should be no further judicial expansions of its scope under current strict liability doctrine.”)    In Beard, the Pennsylvania Supreme Court again chose not to adopt the Restatement (Third) as had been repeatedly predicted by the Pennsylvania federal appellate court.  In the Beard decision, Pennsylvania Supreme Court Justice Max Baer clearly stated that “the current law of Pennsylvania….is §402A of the Restatement (Second) of Torts.”[30]  Id. at 839;  see also Bugay supra at p. 148-149 citing Barnish v. KWI Bldg. Co., 980 A.2d 535 (Pa. 2009) as another example of a case in which the Supreme Court did not criticize the application of the Restatement (Second) analysis to the case presented.

          But the Beard decision was not a definitive decision on the issue as it sent out some mixed signals from Justices on Pennsylvania’s highest court.  In his majority opinion in Beard, Justice Thomas G. Saylor, joined by Chief Justice Ronald D. Castille along with Justices J. Michael Eakin and Joan Orie Melvin, wrote in a footnote, "It may be cogently argued that risk-utility balancing is more legitimately assigned to a jury," referring to the approach endorsed by the Restatement (Third) of Torts.[31]  41 A.3d 838, n. 18.

          Also, Justice Baer filed a concurring opinion in Beard, which Justices Debra Todd and Seamus P. McCaffery joined, in which he attempted to "distance" himself from what he viewed as Justice Saylor's rejection of the standard in Section 402A of the Restatement (Second) calling for a risk-utility analysis to be performed by judges.[32]  Id. at 839.

          As noted in greater detail below, there has developed a split of authority in each of the branches of the federal district courts of Pennsylvania.  While some of the federal district court judges have opted to follow the most recent pronouncement on the issue by the Pennsylvania Supreme Court in the Beard case favoring the Restatement (Second) analysis, still other federal court judges believe they are duty bound to follow the contrary Third Circuit’s predictions in the Berrier and Covell decisions as being binding precedent upon them in favor of the application of the Restatement (Third) standards until a subsequent, contrary decision is handed down by a Pennsylvania state appellate court.

The U.S. Federal Court for the Eastern District of Pennsylvania

          In a March of 2010 decision in the case of Hoffman v. Paper Converting Mach. Co., 694 F. Supp. 2d 359, 364-65 (E.D. Pa. 2010), Judge Petrese B. Tucker of the Eastern District Federal Court of Pennsylvania, noting that, as of that time, the Pennsylvania Supreme Court had dismissed the appeal in Bugosh without deciding the issue, opted to follow the Third Circuit Court of Appeals reference to the Restatement (Third) in Berrier as “binding precedent.” In so ruling, Judge Tucker cited Richetta v. Stanley, 661 F.Supp.2d 500 (E.D. Pa. 2009 Golden, J.), and Martinez v. Skirmish, U.S.A., Inc., 2009 WL 1437624 (E.D. Pa. 2009 Padova, J.) with approval.  The Third Circuit’s prediction on the adoption of the Restatement (Third) was also followed by Judge William H. Yohn, Jr. in Xia Zhao v. Skinner Engine Co., 2:11-CV-07514-WY, 2012 WL 5451817 (E.D. Pa. 2012).

          Other judges in the Eastern Federal District of Pennsylvania have come to the contrary decision that Section 402A of the Second Restatement remains the law of Pennsylvania in light of the fact that the Third Circuit's prediction that the Pennsylvania Supreme Court will adopt the Restatement (Third) as the law of the land has not come to pass.  Thompson v. Med-Mizer, Inc., 10-CV-2058, 2011 WL 1085621 (E.D. Pa. 2011 Gardner, J.)(“This court is not required to follow the Third Circuit's prediction where ‘the state's highest court issues a decision contradicting that prediction or state intermediate appellate court's decisions subsequently indicate that prediction has not come to pass.’ ”) citing Sweitzer v. Oxmaster, Inc., 2010 WL 5257226, at *3–4 (E.D.Pa. 2010 Pratter, J .) and Durkot v. Tesco Equipment, LLC, 654 F.Supp.2d 295, 298–299 (E .D. Pa.2009 Hart, M.J.). 

          In a more recent decision, Eastern District magistrate judge Henry S. Perkin also referred to the Restatement (Second) analysis in the case of Carpenter v. Shu-Bee's, Inc., CIV.A. 10-0734, 2012 WL 2740896 (E.D. Pa. 2012 Perkin, M.J.).

The U.S. Federal Court for the Western District of Pennsylvania

          This split of authority is also evidenced in the Western District of Pennsylvania. Those Pennsylvania Federal Western District Court judges who have presently chosen to follow the Restatement (Second) in products liability cases contrary to the Third Circuit's analysis include Judge Nora Barry Fischer in Gross v. Stryker, 858 F.Supp.2d 466 (W.D.Pa. 2012), Judge Arthur J. Schwab of the Western District in both Konold v. Superior International Industries, 2012 WL 5381700 (W.D.Pa. 2012), and Schif v. Hurwitz, 2012 WL 1828035 (W.D.Pa. 2012).

          The Western Federal District Court Judges who have chosen to instead apply the Restatement (Third) under the Third Circuit's predictions in the Berrier and/or Covell decisions include Judge Mark R. Hornak of the cases of Sansom v. Crown Equipment, 2012 WL 3027989 (W.D.Pa. 2012), and Lynn v. Yamaha Golf-Car, 2012 WL 3544774 (W.D.Pa. 2012), along with Judge Donetta W. Ambrose in Zollars v. Troy-Built, 2012 WL 4922689 (W.D.Pa. 2012), and Judge Maurice Cohill Jr. in Spowal v. ITW Food Equipment Group, C.A. 10-187, ECF No. 52 (W.D.Pa. 2012).

The U.S. Federal Court for the Middle District of Pennsylvania 

          Federal judges in the Middle District of Pennsylvania have also split on the issue of which Restatement should be adopted in products cases.  Middle District Judge A. Richard Caputo has repeatedly ruled that, based upon the Covell court's pronouncement that Berrier remains the controlling formulation of the law for district courts in this Circuit, and given that the Pennsylvania Supreme Court has not issued a decision to the contrary, the Restatement (Third) of Torts should be applied in Pennsylvania Federal Middle District products liability cases as repeatedly predicted by the Third Circuit Court of Appeals.  See Vaskas v. Kenworth, 3:10 CV-1024, 2013 WL 101612  (M.D. Pa. 2013 Caputo, J.);  Giehl v. Terex Utilities, CIV.A. 3:12-0083, 2012 WL 1183719 (M.D. Pa. 2012 Caputo, J.).

          Meanwhile, Judge John E. Jones III of the Middle District issued a contrary decision in the case of Sikkelee v. Precision Automotive, 876 F.Supp.2d 479 (M.D.Pa. 2012), in which he chose to instead follow the Restatement (Second) in products liability cases contrary to the Third Circuit's predictions.  In Sikkelee, Judge Jones respectfully noted that federal district courts are not required to follow predictions by the Third Circuit where that prediction does not appear to have been realized in state court precedent.

          In the appeal of Judge Jones’ decision in Sikkelee, the Third Circuit again noted in its own en banc decision denying a petition for clarification on the appeal that federal district courts in Pennsylvania should continue to apply the Third Restatement.[33]  2012 WL 5077571 (3d Cir. Oct. 17, 2012)(en banc) citing Covell, supra, and Berrier, supra.

Pennsylvania State Courts

          With the law being in a state of flux and the federal court decisions creating a maze of uncertainty, litigants are required to monitor the status of this issue with the Pennsylvania Supreme Court in order to determine how this issue may  ultimately play out. 

          As noted above, the most recent, on-point pronouncement by the Pennsylvania Supreme Court on the Restatement (Second) versus (Third) debate is the court’s decision in Beard v. Johnson & Johnson,[34] 41 A.3d 823 (Pa. 2012) in which the court reiterated, as it has since 1966, that the standards set forth in § 402A of the Restatement (Second) of Torts are to be applied in Pennsylvania products liability cases.

           In its more recent decision in the case of Reott v. Asia Trend, Inc.,[35]  55 A.3d 1088 (Pa. Nov. 26, 2012) a shorthanded Pennsylvania Supreme Court[36]  Justice Joan Orie Melvin was suspended from the court in 2012 to address criminal allegations filed against her pertaining to charges that she used legislative and judicial staff to perform work on her campaign for her seat on the Pennsylvania Supreme Court bench. issued a 5-1 decision recognizing that "highly reckless" conduct is an affirmative defense in products liability cases under which defendants could attempt to avoid liability by showing that a plaintiff's highly reckless conduct was the sole or superseding cause of the plaintiff's injuries.  In so ruling, the majority, in an opinion written by Justice Max Baer, relied upon Section 402A of the Restatement (Second) of Torts. 

          Accordingly, the Reott decision can be read as lending further support to the proposition that the Restatement (Second) remains the law of the land in Pennsylvania products cases.  However, it should also be noted that Reott was analyzed as a manufacturing defect case and both the Second Restatement and Third Restatement are in agreement that strict liability applies in manufacturing defect cases.  The conflict between the two Restatements arguably requires a square decision by the Pennsylvania Supreme Court in a design defect case to finally conclude the matter once and for all.

          It is also noted that, as of the writing of this article in January of 2013, the Pennsylvania Supreme Court has granted allocatur to hear the appeal in the case of Lance v. Wyeth,[37] 15 A.3d 429, 430 (Pa. 2011) in which it may have yet another opportunity to squarely address the Restatement (Second) versus (Third) issue.  The hope remains that the Wyeth court will tackle and finally resolve the issue once and for all when it announces its decision.[38]  A concern in this regard is that the Pennsylvania Supreme Court remains short one Justice on account of Justice Orie Melvin’s current suspension from the bench which could lead to an equally split decision by the Pennsylvania Supreme Court on this all-important issue.  A plurality decision in this regard will do little to end the dispute and would unfortunately represent a missed opportunity resolve this debate once and for all. 

UPDATE:

The Pennsylvania Supreme Court has accepted an appeal in the case of Tincher
v. Omega Flex, No. 842 MAL 2012 (Pa. March 26, 2013) to specifically address
the issue of whether the Restatement (Second) or the Restatement (Third)
standards govern Pennsylvania products liability cases.

In its Order accepting the appeal, the Court wrote, in pertinent part, as
follows:


"AND NOW, this 26th day of March 2013, the Petition for Allowance of Appeal
is GRANTED, LIMITED TO the issue,..slightly rephrased, [as]:

Whether this Court should replace the strict liability analysis of Section
402A of the Second Restatement with the analysis of the Third Restatement.

In addition, the parties are directed to brief the question of whether, if
the Court were to adopt the Third Restatement, that holding should be
applied prospectively or retroactively." [Bracket inserted].

--Daniel Cummins, Foley, Comerford & Cummins

This article was originally published in the Westlaw Journal:  Automotive, Vol. 32, Issue 17 (Feb. 12, 2013).

---

[1] See Sikkelee v. Precision Automotive, Inc., 876 F. Supp. 2d 479, 489 (M.D. Pa. 2012 Jones, J.).

[2] See Samson v. Crown Equipment, 2:10-CV-0958, 2012 WL 3027989 (W.D. Pa. 2012 Hornak, J.).

[3] Restatement (Second) of Torts § 402A (1965).

[4] See Arthur L. Bugay & Craig L. Bazarsky, The Future of Pennsylvania Products Liability as Applied by Federal and State Courts: Covell v. Bell Sports, Inc.  Volume LXXXIII, No. 4 The PA Bar Assoc. Quarterly p. 139, 140 (October 2012) citing  Webb v. Zern, 220 A.2d 853 (Pa.).

[5] Bugay, supra at p. 143 citing with “See” signal Daumbacher v. Mallis, 485 A.2d 423, n. 6 (Pa.Super. 1984) and Surace v. Caterpillar, Inc. 111 F.2d 1039 (3d Cir. 1997).

[6] Id.

[7] Id.

[8] Id. [Citations omitted].

[9] Id.

[10] Id.

[11] Id. citing Restatement (Third) of Torts § 2 (1998).

[12] Bugay supra at p. 144.

[13] Hoffman v. Paper Converting Mach. Co., 694 F. Supp. 2d 359, 365 (E.D. Pa. 2010)

[14] Id.

[15] 841 A.2d 1000 (Pa. 2003).

[16] Id. at 1000 [bracket inserted here].

[17] Bugay supra at p. 146-147 citing with “See” signal DeSantis v. Frick Co.,745 A.2d 624 (Pa. Super. 1999);  Phillips v. Cricket Lighters, supra, and with “See also” signal Bugosh v. I.U. N.A., Inc., 942 A.2d 897 (Pa. 2008).

[18] 942 A.2d 897 (Pa. 2008)

[19] Bugay supra at p. 140 citing Berrier, 563 F.3d 38 (3d Cir. 2009).

[20] Berrier, 563 F.3d at 53-54.

[21] 971 A.2d 1228, 1229 (Pa. 2009).

[22] Id. at 1241 (Saylor, J., dissenting).

[23] Bugay supra at p. 148.

[24] 651 F.3d 357, 365 (3d Cir. 2011).

[25] See 2012 WL 5077571 (3d Cir. 2012)

[26] 11 A.3d 924 (Pa. 2011).

[27] 11 A.3d at 940–41.

[28] Id.

[29] 41 A.3d 823 (Pa. 2012);  see also Schmidt v. Boardman Co., 608 Pa. 327, 11 A.3d 924, 941 (Pa.2011) (“Notwithstanding the Third Circuit's prediction, however, the present status quo in Pennsylvania entails the continued application of Section 402A of the Restatement Second, subject to the admonition that there should be no further judicial expansions of its scope under current strict liability doctrine.”)

[30] Id. at 839;  see also Bugay supra at p. 148-149 citing Barnish v. KWI Bldg. Co., 980 A.2d 535 (Pa. 2009) as another example of a case in which the Supreme Court did not criticize the application of the Restatement (Second) analysis to the case presented.

[31] 41 A.3d 838, n. 18.

[32] Id. at 839.

[33] 2012 WL 5077571 (3d Cir. Oct. 17, 2012)(en banc) citing Covell, supra, and Berrier, supra.

[34] 41 A.3d 823 (Pa. 2012).

[35] 55 A.3d 1088 (Pa. Nov. 26, 2012).

[36] Justice Joan Orie Melvin was suspended from the court in 2012 to address criminal allegations filed against her pertaining to charges that she used legislative and judicial staff to perform work on her campaign for her seat on the Pennsylvania Supreme Court bench.

[37] 15 A.3d 429, 430 (Pa. 2011)

[38] A concern in this regard is that the Pennsylvania Supreme Court remains short one Justice on account of Justice Orie Melvin’s current suspension from the bench which could lead to an equally split decision by the Pennsylvania Supreme Court on this all-important issue.  A plurality decision in this regard will do little to end the dispute and would unfortunately represent a missed opportunity resolve this debate once and for all.

Breaking: PA to Decide Between 2nd and 3rd Restatements on Products Liability

The order is here.

--CJR

Leslie Kendrick: "The Impossibility of Impossibility Preemption"

          When the Supreme Court hears oral argument in Mutual Pharmaceutical Co. v. Bartlett, it will embark on its third elaboration of “impossibility preemption” in the prescription-drugs context.  This line of cases is reshaping preemption doctrine, and it is doing so with little regard for a basic legal idea: the distinction between a property rule and a liability rule.

          The question at issue is whether it is “impossible” for prescription drug manufacturers to comply with both Food & Drug Administration requirements and state tort law.  State tort liability for design defect or failure-to-warn is predicated on a judgment that a drug or drug label was not designed safely.  But manufacturers generally cannot alter drugs or labels without FDA approval.  Thus, manufacturers argue, it is impossible for them to comply with both tort law and FDA requirements.

          The Supreme Court implicitly accepted this view in 2009’s Wyeth v. Levine, when it found no impossibility preemption of a failure-to-warn claim against Wyeth.  The Court rested this conclusion on the view that, under FDA regulations, Wyeth could have changed its drug’s warning label without prior FDA approval.  Wyeth thus could have avoided tort liability while complying with FDA rules. 

          This analysis was always dubious: labeling changes ultimately require FDA approval, and thus a manufacturer’s power to make unilateral changes is short-lived and mostly hypothetical.  But there soon arose a side effect which the majority in Wyeth, led by Justice Stevens, surely neither foresaw nor intended.  To the extent that the power to make unilateral changes exists at all, it is enjoyed only by brand-name manufacturers and not by makers of generic drugs.

          Thus when, in PLIVA, Inc. v. Mensing, the manufacturer of a generic drug made an impossibility preemption claim, the Court sprang the trap it had set in Wyeth.  If impossibility was avoided only to the extent that manufacturers could change their labels, then impossibility must exist with respect to generic drugs.

          In Mutual Pharmaceutical Co. v. Bartlett, the Court is being asked to extend this analysis to preempt some suits against generic manufacturers for design defects.  And the United States, for its part, appears to ask the Court to feel free to endorse this rule for all design-defect claims, for both generic and brand-name drugs, on the theory that no manufacturer can alter the substance of its drug without FDA approval.  What started as a ground for rejecting preemption in Wyeth is now poised to eliminate virtually all tort liability for prescription drug manufacturers, all in the name of “impossibility.” 

          But if we know one thing about tort law, we know that it is not impossible to comply with it and FDA requirements simultaneously.  We know this because drug manufacturers have been complying with both since the passage of the Federal Food, Drug, and Cosmetic Act in 1938.   

         Moreover, anyone briefed in the most basic attributes of tort liability and FDA regulation can explain why.  Tort liability requires manufacturers to pay damages, not to alter their products.  A manufacturer may market a drug as approved while paying tort damages.  The manufacturer has other options, such as seeking to modify a drug or label, or developing improved products.  But it is entirely possible to change nothing and comply with both sets of laws.

          These facts cannot have escaped the Court’s notice but may seem too mundane, or too literal, to matter.  The Court focuses exclusively on the “duty” imposed by FDA and tort rules.  FDA requires a drug or label to have a certain content, and the implication of tort liability is that it should have a different content.  Hence, impossibility. 

          But in focusing on duties to the exclusion of remedies, the Court is disregarding the fundamental distinction between a property rule and a liability rule.  FDA regulation subjects drug manufacturers to a property rule: drugs must conform to FDA requirements or be recalled from the market.  Tort liability, meanwhile, is the classic liability rule: the remedy for breach is the payment of damages. 

          It is no coincidence that FDA’s powers function like a property rule.  The point is for FDA to decide which drugs can be marketed and which cannot.  Nor is it a coincidence that the state tort claims at issue are liability rules.  Tort liability does not enjoin behavior.  It charges a price, without altering other entitlements.   It is not impossible for these two regimes to co-exist.  It’s impossible that they couldn’t.

          From this perspective, it also becomes clear that the so-called “stop-selling” doctrine at issue in Bartlett is not necessary to its resolution.  The First Circuit held that there was no impossibility preemption because the drug manufacturer could comply with both regimes by not selling the drug.  “Stop selling” may be a response when a product faces conflicting injunctions (e.g., “Do X or your product will be recalled,” and, “Do not-X or your product will be recalled.”).  But the whole point of a liability rule is that the manufacturers need not stop selling in order to comply with it.  They can pay and play. 

          This is not to say that no conflict may ever arise between tort law and FDA regulation.  But impossibility is not the right term, under any plausible definition.  It is not physically impossible to comply with both regimes.  There is no inherent logical contradiction in them.  Instead, the question is how much one gets in the way of the other. 

          The question thus involves the other form of implied preemption: obstacle preemption.  The Court rejected obstacle preemption in the context of Wyeth.  Available evidence suggests that Congress, in passing the FDCA, understood tort and FDA regulation not to conflict but to complement each other.  FDA, throughout most of its history, has held the same position.

          And there is good reason to adopt this view.  Given the nature of drug trials and the FDA approval process, there is always a risk of side effects whose gravity only becomes clear after a drug is on the market.  Drug manufacturers are generally in the best position to bear this risk, because they have more information about their drugs than either FDA or consumers and they have the ability to work with FDA to alter a drug or label.  To adopt another Calabresian term, drug manufacturers are the cheapest cost avoider.  Meanwhile, a system that immunizes drug manufacturers provides
suboptimal levels of deterrence.

          We may worry, however, that tort liability will be so costly that it will cause drug manufacturers to raise prices to unaffordable levels, stop developing new products, or withdraw from the market entirely.  Such possibilities could have serious public health consequences, and thus they are germane to the preemption question.   

          But this is an incidental effect of liability, not an indication of impossibility.  To conclude
otherwise would suggest, for example, that the special immunities given to vaccine manufacturers are unnecessary.  If it is impossible for all drug manufacturers to comply with regular FDA regulations and state tort law, then there is no need for special rules that treat the interaction of these two regimes as imposing particularly steep incidental costs on particularly necessary medications. 

          In short, whether tort law and FDA regulation conflict or complement each other is a question not of formalism but of facts on the ground.  Either way, what is happening is not a question of impossibility.  The Wyeth impossibility trap is one of the Court’s own devising, and the Court should extricate itself.

--Leslie Kendrick, University of Virginia School of Law 

Pfizer Seeks Rehearing in Generic Liability Case

Forbes reports that Pfizer is asking the Alabama Supreme Court to reconsider its decision holding Pfizer liable for failing to warn a consumer who took a generic version of the drug Reglan.  The article points out the regulation, not litigation, may answer this one:

Meanwhile, though, the issue may be decided by the FDA. The agency recently disclosed plans to revise its regulations so that generic drugmakers can update product labeling and warn patients about risks associated with their drugs. If the FDA were to make such a change, generic drugmakers could be sued in state courts – if they become aware of evidence of serious side effects, but do not take action to update the product labeling (back story). 

- SBS

PA Judge Upholds $10M Children's Motrin Verdict

The Legal Intelligencer reports that Philadelphia Court of Common Pleas Judge Nitza Alejandro has denied Johnson & Johnson's McNeil-PPC's post-trial motions in a case involving over the counter Children's Motrin.  In the case, a jury awarded $10 million to a young girl who suffered Stevens-Johnson syndrome/toxic epidermal necrolysis after taking Children's Motrin.   The full story is behind a free registration wall.

Thanks to Lisa Smith-Butler for the alert.

- SBS

 

More on Stengel v. Medtronic (Ninth Circuit Preemption Decision)

Over at Torts Today, George Conk has commentary on Stengel v. Medtronic, the Ninth Circuit preemption decision reported here last week.  

- SBS

 

 

Ninth Circuit Allows Failure to Warn Medical Device Case to Proceed

Muddling the preemption waters, the Ninth Circuit has ruled that a plaintiff can bring a state law failure to warn claim against a medical device manufacturer.  The court found the claim was not preempted by the Medical Device Amendments to the Food, Drug, and Cosmetic Act.   A copy of the opinion is here.  The Recorder (via law.com) has more.

Thanks to Lisa Smith-Butler for the alert.

- SBS

PA: New Ruling on Products Liability Affirmative Defense

On Monday, the Supreme Court of Pennsylvania ruled that, in order to avoid liability, a defendant raising a claim of highly reckless conduct must plead and prove such claim as an affirmative defense.  The case, Reott v. Asia Trend, is here.

Thanks to Scott Cooper for the tip.

--CJR

Meningitis Lawsuits

The Sunday Boston Globe contained an article by Jay Fitzgerald on the potential suits from the outbreak of meningitis linked to a Framingham drug compounding pharmacy.  Suffolk's Mike Rustad is quoted in the piece.

--CJR

Conk on Exploding Gas Cans, Products Liability, and Plaintiff's Misconduct

His coverage at Torts Today is here and he links to the NYT story (quoting Marshall Shapo and Frank Vandall).

--CJR

"Philly Regrets Flood of Cases"

The Wall Street Journal reports that mass tort filings in the Philadelphia Court of Common Pleas have "skyrocketed from 550 in 2008 to nearly 2,700 last year. The surge left an already busy court system buried in lawsuits and scrambling to repair the damage."    The article reports:

Also contributing to the surge of cases: the success of the Complex Litigation Center, a specialized Philadelphia court established in 1992 largely to handle the growing asbestos and pharmaceutical docket. The center adopted techniques that were designed to move cases through quickly, such as setting early trial dates, holding frequent meetings among the lawyers, and consolidating similar cases.

The Complex Litigation Center drew more mass-tort cases to Philadelphia. But until recently, it was largely able to manage its docket. Since 2008, the backlog of asbestos and pharmaceutical cases has shot up from about 2,600 to more than 6,100 through last month. Last year, 88% of the pharmaceutical cases were filed by out-of-state plaintiffs, according to the court.

The mess is now largely Judge Herron's to deal with. Since taking over as the administrative judge late last year, he has put into place several measures designed to reverse the trend—and to send a message to out-of-state lawyers to take their lawsuits to other courts. "Go elsewhere," he says, when asked to describe the message he is hoping to send to out-of-state lawyers. "There are a lot of really wonderful courts in the U.S., and you should make broader use of them."

- SBS

 

PA: Is R3:PL the Law or Not?

This week, Amaris Elliott-Engel, of PA Law Weekly, wrote the first of a series of articles on tort law.  Her first piece is on the uncertainty in Pennsylvania products law.  Twice in the last 3 years, the U.S. Court of Appeals for the Third Circuit has opined that the Pennsylvania Supreme Court would adopt the Restatement Third (Products Liability).  However, the state Supreme Court has not directly addressed the issue, although there has been some provocative dicta and one instance in which the justices announced they had improvidently granted allocatur to consider whether section 2 of R3 should replace 402A of R2.  Thus, in general, state courts are applying 402A and federal courts are applying R3, though even among federal courts, some apply 402A.  As elsewhere, most plaintiffs' lawyers tend to prefer 402A and most defense lawyers tend to prefer R3.

Thanks to Scott Cooper for the tip.

--CJR

New Jersey Court Rejects Brand-Name Manufacturer Liability for Injuries Caused By Generic

Abnormal Use reports that a New Jersey Superior Court has rejected the "innovator liability" theory accepted by a California court in Conte v. Wyeth.  Under this theory, a plaintiff sues a brand-name manufacturer of a drug for injuries allegedly caused by taking the generic version of the drug.  To date, Conte is the only decision upholding this theory of liability.

- SBS

Does Product Liability Makes Us Safer?

Kip Viscusi (Vanderbilt) recently pubished an article in Cato's Regulation, on "Does Product Liability Make Us Safer?"  The article is now available on SSRN.  The article concludes:

Rather than creating an environment to foster safer products, product liability law often has adverse consequences. Some of the problems stem from the inherent nature of product risk decisions and the function of tort liability, while others may derive from individuals’ cognitive limitations and inability to think properly about balancing risk and cost. Thus it would be both incorrect and an oversimplification to blame all the ills on the tort liability system. That system functions reason- ably well for many types of accidents, such as personal motor vehicle accidents. However, tort liability falls short with respect to products.  

- SBS

9th Circuit Preemption Case of Interest

On Monday, the Ninth Circuit issued its decision in Stengel v. Medtronic, Inc., No. 10-17755, slip op. [pdf]. The case involved a Medtronic pain-pump that the plaintiff alleged caused his paraplegia. The Ninth Circuit upheld dismissal based on Reigel v. Medtronic, Inc., 552 U.S. 312 (2008), and also denied plaintiffs' "failure to report" claim under implied preemption.

Drug & Device Law has a thorough examination of the opinoin. Arizona Central also has a report.

- SBS

Philly Asbestos Verdict Challenged

The Legal Intelligencer reports on a variety of issues raised by the plaintiffs in a post-trial motion challenging a defense verdict in Webber v. Ford Motor Co.   In particular, plaintiffs' counsel alleges that the verdict form was the result of ex parte contact by defense lawyers and the supervising judges in Philadelphia's Mass Torts Program.

Thanks to Lisa Smith-Butler for the alert.

- SBS

Asbestos Claims from Malta

Asbestos.com reports the heirs of dockyard workers in the tiny Mediterranean country of Malta filed asbestos-liability claims in New York against American companies that made products used aboard U.S. Navy ships.

The dock workers were exposed to the asbestos when the Navy ships were brought in for service and repairs. Although the exposure came as long as 40 years ago, some of the worker died only recently. Mesothelioma cancer, which is caused by the asbestos exposure, can linger for up to 50 years before it shows any symptoms.

According to Maltatoday, the leading news service in Malta, up to 400 workers or their families have filed claims through the United States court system.

Thanks to Cary Sklaren for the tip.

--CJR

Maybe Not the Best Place for That Gauge

Gawker presents a somehow-not-fictional air gun with the air pressure gauge in what might be called...not an ideal location.  Check it out.  I'd say it's exam-worthy, except the counterarguments would be a bit weak.

--BC