Mexican Senate OKs Class Actions

For several years, there has been discussion of the possible spread of US-style class actions to other countries, particularly in Europe.  Class actions in Canada have proven especially problematic for the pharmaceutical industry. Now comes news that Mexico's Senate voted earlier this month to reform Mexican legal procedures to allow class actions for the first time in Mexican courts.

The bill was approved unanimously by senators in attendance, and now goes to the lower chamber, the Chamber of Deputies.  The chamber has been reportedly working on its own version of legislation to permit class actions, which would grant power to judges to allow class action cases. The mechanism involved in the Senate bill is an amendment of several existing civil procedure codes.

The Senate version would allow consumers to bring aggregated cases based on financial overcharging, environmental damage, or product defects.  Proponents cite "access to justice" principles and the possibility the collective actions will encourage better quality products and improved financial services. The bill would not permit class actions in any government-run industry.

The push for class actions follows a constitutional amendment opening the door to class actions. It requires any such actions be exclusively in the Mexican federal courts.

 

State Supreme Court Reverses Plaintiff Verdict in Welding Rod Litigation

While a handful of large plaintiff verdicts has garnered much of the media attention, most of the trials involving welding fume claims have been favorable to defendants. Something like 26 out of 31 trials have resulted in defense verdicts. Since January 2006, thousands of plaintiffs have abandoned their claims. In fact, plaintiffs have dismissed about 2/3 of the cases they had certified as trial‐worthy in the federal MDL court. Plaintiffs are now actively pursuing fewer than 750 cases in the MDL proceeding, a reduction of approximately 85 percent from the number of pending MDL cases in 2005.

The latest development in this mass tort sees the Mississippi Supreme Court overturning
a $1.86 million jury verdict in favor of a welder who claimed welding rods manufactured by
The Lincoln Electric Co. and ESAB Group Inc. caused his magnesium-related neurological
disease. Lincoln Electric Co. et al. v. McLemore, No. 09-CA-00320 (Miss. 12/9/10).

Plaintiff Stanley McLemore worked as a welder for almost thirty years. In the course of his
career, McLemore worked all over the country, with two long stints at Grand Gulf Nuclear
Power Station from 1980 through 1984 and from 1993 through 1998. He developed symptoms in 2001 and went to the doctor. While McLemore saw a host of physicians between December 2001 and his trial date in 2008, they determined that he had some form of Parkinsonism. A few considered manganism, but ultimately decided against that diagnosis. Dr. Swash was McLemore’s main expert witness at trial. This doctor was the only physician to diagnose McLemore with manganism. According to Dr. Swash, manganism is a syndrome with features of atypical Parkinsonism that is caused by exposure to manganese.

McLemore stated that he first learned that he suffered from manganism in 2005, and then he sued in late 2005. However, defendants claimed he had been diagnosed with a welding-related  neurological illness in early 2002.  McLemore filed various lawsuits claiming neurological injuries from exposure to welding products as early as February 2004, against various corporations for injuries suffered from those defendants’ sale and/or distribution of defective welding consumables. The complaint did not name either Lincoln Electric or ESAB.

Mississippi has a three year statute of limitations, and defendants therefore sought summary judgment. McLemore contended that he had no cause of action until he knew that he had manganism. Pursuant to Mississippi law, a plaintiff’s cause of action accrues at the point at which he discovered, or by reasonable diligence should have discovered, the injury. Therefore, the Court had to consider the application of the latent-injury/discovery rule and whether McLemore’s statute of limitations began to run when either (1) he knew of his diagnosis of Parkinsonism, or (2) he knew of the diagnosis of manganism. 

In Angle v. Koppers, Inc., 42 So. 3d 1 (Miss. 2010), the state Court determined that the plain
language of the state act supported an interpretation “that the cause of action accrued upon
discovery of the injury, not discovery of the injury and its cause.” Id. at 5. Applying Angle to the instant case, McLemore knew of his injury in September, 2002. At that time, his doctor informed him of the correlation between his symptoms and welding; that is, informed McLemore that he had Parkinsonism and that it might have been related to his welding work.. The statute does not require a plaintiff to know the actual cause of the injury before accrual of the cause of action.  McLemore
thereafter sought legal advice which resulted in an initial filing of a lawsuit in 2004 claiming
“serious neurological injury” from exposure to manganese products. Consequently,
McLemore’s argument that he had no knowledge of his injury and its relation to welding
until his diagnosis of manganism failed. The Court rejected the plaintiff's distinction between knowledge of a diagnosis of a welding-related illness (Parkinsonism) and a welding-related injury (manganism).

Court of Appeals Affirms Exclusion of Plaintiff Causation Experts in Toxic Tort Case

Insecticide manufacturers held on to summary judgment as the Eight Circuit affirmed the lower court's causation ruling under DaubertJunk v. Terminix International Co., No. 08-3811 (8th Cir., 12/9/10).

The plaintiffs'  home had been infested with spiders during the mother's pregnancy, and she contacted Terminix about the problem.  Defendant thereafter sprayed a pesticide inside and outside the Junks' home, approximately 20 times, the last occurring two years after her son's birth. Junk alleged that the child's multiple medical conditions were caused by exposure to ingredients in Dursban, an insecticide manufactured by Dow, distributed by Terminix.

The defendants moved to exclude the causation testimony of plaintiffs' two medical experts, and for summary judgment.  The trial court first excluded the testimony of Dr. Richard Fenske, who had been retained to determine whether the son had been exposed to an unsafe level of the insecticide during his mother's pregnancy and after his birth. Dr. Fenske testified that when making toxic exposure and dosage estimates he usually relied on a "deterministic modeling" method in which he creates an exposure model that accounts for numerous variables. In this case, however, he did not have sufficient data to perform such an analysis. Instead, he compared what he knew about the circumstances of the child's exposure with those in published studies. This comparative analysis led him to conclude that plaintiff had been exposed to an unsafe level. Observing that Dr. Fenske had not followed his own usual methodology and concluding that he had relied on a number of ungrounded assumptions in his comparative approach, the district court excluded his opinion on the ground that his methodology was not sufficiently reliable.

Dr. Cynthia Bearer's testimony was also excluded. She was a neonatologist and board certified pediatrician whom Junk retained to give her opinion on general and specific causation.  Because Dr. Bearer's opinion on specific causation relied on Dr. Fenske's conclusions, after the court excluded Dr. Fenske's testimony, it found Dr. Bearer's opinion on specific causation also lacked a scientific factual basis and declined to admit it.

Plaintiffs appealed.

The court of appeals agreed that Dr. Fenske's comparative analysis depended on various unsupported assumptions. He did not account for differences between conditions in the Junk household and those described in the articles he consulted. In one instance, his only basis for comparison was the fact that the Junk household and those in a particular study were all treated with the Dursban ingredient chlorpyrifos. In another, he relied on a study where the only common variable between the Junks' experience and the homes studied was the total amount of chlorpyrifos applied. Dr. Fenske thus disregarded other important variables such as where and how chlorpyrifos was applied in the household and whether the homes in a comparison study were the same size as the Junks' home.


While Dr. Fenske was not required to produce a mathematically precise table equating levels of exposure with levels of harm, he was required to have a "scientifically valid" method to estimate that plaintiff's exposure exceeded a safe level. The expert's failure to follow his own general practice and his reliance on unfounded assumptions in his comparative method created "too great an analytical gap" between his opinion and the data on which it relied.

Because Dr. Bearer's differential diagnosis depended on Dr. Fenske's opinion on exposure, the district court did not abuse its discretion in excluding it. A differential diagnosis begins with an expert's "ruling in" plausible causes of an injury. See Kudabeck v. Kroger Co., 338 F.3d 856, 860–61 (8th Cir. 2003). Then the expert "rules out" less likely causes until the most likely cause remains. Without a scientific basis for including unsafe chlorpyrifos exposure in her differential, her opinion amounted to speculation.

To succeed in her claims, Junk needed to present expert testimony showing that the chlorpyfiros could have caused the son's injuries and that it did in fact cause those injuries. Junk's  experts did not survive the district court's Daubert analysis. After the court properly excluded Dr. Bearer's
testimony, Junk could not prove specific causation as required under Iowa law. As there was no longer a genuine issue of material fact as to that necessary element, Dow and Terminix were entitled to judgment.

 

 
 

Seventh Circuit Sticks to Its Criticism of CopyCat Class Action

Last month we posted about a class action decision from the Seventh Circuit, in which the court of appeals approved an injunction against copycat litigation once class certification was denied.  Thorogood v. Sears, Roebuck & Co., No. 10-2407 (7th Cir., 11/02/10).

Ordinarily the ability to plead res judicata or collateral estoppel gives a litigant adequate protection against being harassed by repetitive litigation by the loser in a previous suit against him. But this case was unusual, said Judge Posner, both because it involved class action litigation and because of the specific tactics employed by class counsel. Class members are interested in relief for the class but the lawyers are primarily interested in their fees, and the class members’ stakes in the litigation are ordinarily too small to motivate them to supervise the lawyers in an effort to align the lawyers’ incentives with their own. The defendant wants to minimize outflow of expenditures
and the class counsel wants to increase inflow of attorneys’ fees. "Both can achieve their goals if they collude to sacrifice the interests of the class.” Leslie, “The Significance of Silence: Collective Action Problems and Class Action Settlements,” 59 Fla. L. Rev. 71, 79-81 (2007). And when the
central issue in a case is given class treatment and so will be resolved once and for all, a trial becomes a roll of the dice. Depending on the size of the class, a single throw may determine the outcome of an immense number of separate claims (hundreds of thousands, in this home dryer
litigation)—there is no averaging of decisions over a number of triers of fact having different abilities, priors, and biases. The risk of error becomes asymmetric when the number of claims aggregated in the class action is so great that an adverse verdict would push the defendant into bankruptcy; in such a case the defendant will be under great pressure to settle even if the merits
of the case are slight.

The plaintiff appellee filed a petition for panel rehearing, and rehearing en banc. All the judges  voted to deny the petitions, and typically that is the end of the appeal.  But the court wrote an opinion about the denial, "in view of the accusations leveled in the petition by the plaintiff’s lawyer."

On the merits, said the court, the petition ignored the principal reasons for enjoining the copycat class actions, and said virtually nothing about the All Writs Act, which was the very grounds for the prior decision.  The petition also ignored the point that class certification was improper given the nature of the plaintiff's claim, which did not present common issues that would support a class action.  It ignored the panel's criticism of the district court reasoning, and mischaracterized the scope of the injunction, as individual claims were not enjoined.

The petition's main concern was with the language used in the opinion describing plaintiff counsel as pugnacious, pertinacious to a fault, and a "nuisance." To which the panel responded that the petition ignored the facts and analysis that supported those characterizations, and the right of a court to  and the duty of a court to note unacceptable tactics.

The petition claims the panel did not treat the counsel with respect, to which the court noted that the lawyer had compared Judge Posner to Simon Cowell.

What the panel had said is that the structure of class actions gives plaintiff lawyers an incentive to negotiate settlements that enrich themselves but give scant rewards to class members. With numerous citations, the panel noted that the criticisms in the prior opinion of the tactics employed by some class action lawyers are not criticisms made by judges alone, let alone judges of the panel or judges of the Seventh Circuit.

So far from retracting any criticisms or modifying any language, the court reaffirmed its key criticisms.

Supreme Court Agrees to Hear Greenhouse Gas Case

The U.S. Supreme Court announced earlier this month that it will indeed hear the challenge to a court of appeals decision allowing several states to pursue a public nuisance suit against various utilities for their greenhouse gas emissions. See American Electric Power Co. v. Connecticut, No. 10-174 (U.S. certiorari petition granted 12/6/10).

Readers may recall the issues from previous posts.  Two groups of plaintiffs, one consisting of eight states and New York City, and the other consisting of three land trusts, sued six electric power corporations that own and operate fossil-fuel-fired power plants, seeking abatement of defendants' alleged ongoing contributions to the "public nuisance of global warming." Plaintiffs claimed that global warming, to which the defendants allegedly contributed as large emitters of carbon dioxide, is causing, and will continue to cause serious harm affecting human health and natural resources. Plaintiffs brought these actions under the federal common law of nuisance or, in the alternative, state nuisance law, to force defendants to cap and then reduce their carbon dioxide emissions. The district court, 406 F. Supp. 2d 265, 268 (S.D.N.Y. 2005),  correctly held that plaintiffs' claims presented a non-justiciable political question and dismissed the complaints. On appeal, plaintiffs argued that the political question doctrine does not bar adjudication of their claims; that they had standing to assert their claims; that they had properly stated claims under the federal common law of nuisance; and that their claims were not displaced by any federal statutes.

In a lengthy opinion, 582 F.3d 309 (2d Cir. 2009), the court of appeals held that the district court, had erred in dismissing the complaints on political question grounds; that all of plaintiffs had standing; that the federal common law of nuisance governs their claims; that plaintiffs had stated claims under the federal common law of nuisance; that their claims were not displaced. In a very minimalist interpretation of what is needed for standing, the Second Circuit distinguished multiple precedents of the Supreme Court which held that to have standing a plaintiff must allege an injury that is concrete, direct, real, and palpable -- not abstract. Injury must be particularized, personal, individual, distinct, and differentiated -- not generalized or undifferentiated.

AEP and three other power companies filed a petition for writ of certiorari Aug. 2, asking the Supreme Court to review the decision. The federal government (Acting Solicitor General Neal Katyal on behalf of the Tennessee Valley Authority, a government-owned company), urged the Supreme Court to overturn this decision that allowed Connecticut and several other states to move forward in their suit seeking greenhouse gas emissions reductions under a federal common law nuisance theory. A dozen states  joined the Administration, and a variety of amici, in urging the Supreme Court to review the decision by the Second Circuit.

One central issue is whether the EPA will be the primary regulator of greenhouse gas emissions or whether private parties will be permitted to go directly to court.  Should a single judge set emissions standards for regulated utilities across the country—or, as here, for just that subset of utilities that the plaintiffs have arbitrarily chosen to sue?  Judges in subsequent cases could set standards for other utilities or industries, or conflicting standards for these same utilities.
A second issue is whether controlling power plant emissions is a political question beyond the reach of the courts.

Note that Justice Sotomayor was a member of the Second Circuit when it heard oral arguments in Connecticut v. American Electric Power Co.  Thus it appears only eight justices will hear the case.
Justice Anthony Kennedy may turn out to be the pivotal vote in the case, based on his vote in Massachusetts v. EPA, 127 S. Ct. 1438 (2007).  The Supreme Court may not be eager to see a flood of common law litigation against greenhouse gas sources.

  

Consolidated Benlate Trials Improper

A Florida appeals court recently reaffirmed its prior ruling granting new trials and reversing approximately $20 million in verdicts against defendant DuPont.  See Agrofollajes, S.A., et al., v. E.I. Du Pont De Nemours & Company, Inc., 2010 WL 4870149  (3d DCA, 12/1/10). The court had issued a prior opinion in December, 2009, but it then granted the farmers' motion for a rehearing.

This action involved the mass, consolidated tort cases commenced by twenty-seven Costa Rican growers of leatherleaf ferns against Du Pont, alleging product liability claims for injuries allegedly caused by Benlate, a systemic fungicide that Du Pont manufactured and marketed. Leatherleaf fern is an ornamental crop, a brightly colored and symmetrically shaped fern that florists use to enhance cut flower arrangements. The plaintiffs are commercial growers of leatherleaf fern in Costa Rica who grow the ferns for a worldwide market, providing ferns mostly for Europe and Japan. The complaints alleged that the plaintiffs’ leatherleaf fern plants were damaged by Du Pont
because: (1) the Benlate was cross-contaminated with other chemicals that were manufactured at the same facility, and (2) Benlate DF broke down into DBU, a herbicide-like agent called dibutylurea (DBU), which was toxic and caused the plant damage.

The plaintiffs sought a consolidated trial, representing to the trial court that consolidation would be more efficient because there were "many common issues" between the claims.  Conversely, Du Pont alleged substantial differences in the plaintiffs’ Benlate use, farm management, growing conditions, growing practices, chemical uses, periods in which deformities materialized, plant disease problems experienced, and damage claims. DuPont also proffered different alternative causes for the plant damages at the various ferneries. DuPont proposed that the court schedule either one fernery or one group of ferneries, under common management, as individual
plaintiffs in separate trials. The trial court nevertheless ordered a single, consolidated trial of
the claims by all twenty-seven plaintiffs.  At trial, however, the plaintiffs’ opening statement re-characterized the "common issues." The plaintiffs acknowledged instead that there was only one
material issue that was common to all the plaintiffs, the use of Benlate.  The evidence presented at trial substantiated the many differences that existed among the individual plaintiffs, including use of Benlate, use of other chemicals, and regarding the ferneries.

After an eight-week trial during which the parties introduced considerable evidence that alleged disparate material facts among the twenty-seven individual plaintiffs, the jury deliberated for five days. The jury found against DuPont on negligence and awarded each of the twenty-seven consolidated plaintiffs identical awards. The jury awarded every plaintiff the same percentage, sixty percent, of the past damages claimed.

On appeal, DuPont argued that the trial court denied defendant a fair trial by improperly consolidating plaintiffs’ twenty-seven disparate claims.  In deciding whether to consolidate cases, a Florida  trial court must consider: (1) whether the trial process will be accelerated due to the consolidation; (2) whether unnecessary costs and delays can be avoided by consolidation; (3) whether there is the possibility for inconsistent verdicts; (4) whether consolidation would
eliminate duplicative trials that involve substantially the same core of operative facts and questions of law; and (5) whether consolidation would deprive a party of a substantive right.  The court said that Florida courts have noted that Florida Rule of Civil Procedure 1.270(a) essentially “duplicates” Federal Rule 42(a).

The issues were with items four and five. The record demonstrated that the common issues did not predominate at trial. As plaintiffs’ counsel's candid opening statement remark confirmed, other than Benlate, the plaintiffs “don’t have anything else in common.”  Illustrative of the disparate experiences: fourteen ferneries claimed that the damage appeared immediately while others claimed that the symptoms did not appear for years. The plaintiffs’ ferneries were located in different areas of Costa Rica and were situated at different elevations, resulting in different climates and growing environments for the plants. The ferneries also experienced distinctive problems controlling pests and fungus and were subject to unique issues regarding hurricane damage, flooding, poor sunlight, over-harvesting and inadequate drainage.

DuPont further claimed that consolidation was not proper because it was deprived of a substantive right, as consolidation of the twenty-seven claims resulted in unfair prejudice to it. Unfair prejudice as a result of consolidation is a broadly recognized principle. The Florida Supreme Court in State v. Williams, 453 So. 2d 824, 825 (Fla. 1984), held that “even if consolidation is the ‘most
practical and efficient method of processing’ a case, practicality and efficiency should not outweigh a defendant's right to a fair trial.”  Here, the jurors were asked to recall a vast assortment of unique facts for each of the twenty-seven plaintiffs. The particulars included each fernery’s previous growing history, when the various symptoms manifested, what injuries Benlate allegedly caused, and what damage could be attributed to other causes, as well as numerous other factors that uniquely impacted fern production at each individual fernery. This almost guaranteed juror confusion.  The common awards by the jury, in conjunction with the vast amount of disparate evidence presented at trial, demonstrate that the consolidation of the twenty-seven claims resulted in a hopelessly confused jury.

Importantly, the court also saw that by consolidating the claims, the plaintiffs introduced evidence to the jury that would not have been admissible had the cases been tried separately.  For example, in considering evidence on claims by plaintiffs who did not use Benlate after 1991, the jury was allowed to hear evidence of DuPont’s subsequent remedial measures, even though the measures were inadmissible as to those plaintiffs.

The court of appeals reversed the trial court’s final money judgments and amended final
money judgments rendered upon disposition of the parties’ post-trial motions and
remanded the cases to the trial court for new individual trials and for further proceedings
consistent with the opinion. The trial court was left free to choose to schedule either one fernery or one group of ferneries, under common management, as individual plaintiffs in separate trials.

Amended Federal Rules Take Effect

Readers will recall from our previous posts that amendments to the Federal Rules of Civil Procedure were in the works for some time.  They finally took effect earlier this month. With regard to Rule 26, the amendments extend work-product protection to the discovery of draft reports by testifying expert witnesses and, with three important exceptions, to the discovery of communications between testifying expert witnesses and retaining counsel. The amendments also provide that a lawyer relying on a witness who will provide expert testimony but is not required to provide a Rule 26(a)(2)(B) report – because the witness is not retained or specially employed to provide expert testimony and is not an employee who regularly gives expert testimony – must disclose the subject matter of the witness’s testimony and summarize the facts and opinions that the witness is expected to offer.

The prior 1993 amendments to Civil Rule 26 had been interpreted by some courts to allow discovery of all draft expert witness reports and all communications between counsel and testifying expert witnesses.  The experience under those amendments revealed significant practical problems in the eyes of many litigators. The rule changes are generally seen as an improvement for trial lawyers.  Experts and attorneys may now communicate more freely, such as by email, instead of engaging in time-consuming dances designed to avoid creating potentially discoverable communications. The amendment allows attorneys and experts to exchange draft reports for review and discussion without fear of the consequence of the production of such communications. It also eliminates attorney time spent trying to negotiate a stipulation with opposing parties in order to avoid disclosure of this type of information. 

The rules still permit discovery of communications related to the experts' compensation, any assumptions provided by counsel to the expert to rely on; and facts or data that counsel provided to the testifying expert.  Time will tell if the courts interpret the latter two as being limited to disclosure of objective information the lawyer provided to the expert, and not the general conversations they had surrounding those facts or interpretations of those facts.  One likely effect is that counsel will want experts, to the extent possible, to find facts and data for themselves in public sources.

 

Proof of General Causation in Drug Case Not Automatic

A West Virginia federal court has granted summary judgment against a plaintiff alleging that the heartburn drug metoclopramide caused her tardive dyskinesia.  Meade v. Parsley, et al., 2010 WL 4909435 (S.D.W.Va.,  11/24/10).

Since its approval by the Food and Drug Administration in 1980, metoclopramide has been widely used to treat gastroesophageal reflux disease (“GRD”), nausea, and gastroparesis.  Plaintiff's treater, Dr. Deidre Parsley, prescribed metoclopramide to Mrs. Meade in order to treat her
GRD, nausea, and loss of appetite. Plaintiff  never read any written materials accompanying her metoclopramide prescriptions, which included a statement that therapy longer than 12 weeks has not been evaluated and cannot be recommended.  Dr. Parsley likewise did not read the metoclopramide package insert or any other written materials produced by PLIVA before prescribing the drug to Mrs. Meade. After the drug usage, the FDA added a black box warning about tardive dyskinesia.  But, save for the placement of the warning in a black box, the previous warning seemed not too different.

Plaintiffs contended that the warnings were inadequate in that they misleadingly invited long term use that has never been approved by the FDA, despite the fact that the warning did state that therapy longer than 12 weeks has not been evaluated and cannot be recommended. In addition,
plaintiffs claim that the warnings downplayed the seriousness and potential irreversibility of the risk of tardive dyskinesia in long term use, but the warning did state that the risk is highest among the elderly, especially elderly women (like this plaintiff), and that the likelihood of irreversibility is believed to increase with the duration of treatment and the total cumulative dose. 

Defendant moved for summary judgment, contending that there were no genuine issues of material fact inasmuch as (1) plaintiffs could not establish causation; (2) Dr. Parsley was aware of the risks of using metoclopramide when she prescribed the drug to Mrs. Meade; (3) PLIVA satisfied any alleged duty to warn by providing a package insert explaining potential side effects of
metoclopramide.  The court never had to reach the third argument.

In a pharmaceutical products liability action, a plaintiff must initially establish both general and specific causation for his injuries. Bourne ex rel. Bourne v. E.I. Dupont de Nemours & Co., 189 F. Supp. 2d 482, 485 (S.D. W. Va. 2002).  General causation is whether a substance is capable of causing a particular injury or condition in the general population, while specific causation is whether a substance caused a particular individual's injury. In re Rezulin Prods. Liab. Litig., 369 F.
Supp. 2d 398, 402 (S.D.N.Y. 2005); In re Hanford Nuclear Reservation Litig., 292 F.3d 1124, 1129 (9th Cir. 2002). General causation is established by demonstrating, often through a review of scientific and medical literature, that exposure to a substance can cause a particular disease.

In addition to general and specific causation, plaintiffs must establish proximate causation.To
show proximate causation in a failure-to-warn case based on an allegedly inadequate drug label, a plaintiff must show that a different label or warning would have avoided the plaintiff’s injuries. The court noted that the West Virginia Supreme Court has not had occasion to clarify whether a drug manufacturer must warn both the patient and the physician, or just the patient.  But it did not need to resolve this issue in evaluating proximate causation, however, because the undisputed evidence shows that an adequate warning would not have changed either Mrs. Meade’s or Dr. Parsley’s behavior in a manner which would have avoided Mrs. Meade’s injury.  Rather than merely showing that “adequate warnings would have changed behavior,”  as plaintiff argued, plaintiffs must
establish that an adequate warning would have changed behavior in a manner which would have avoided the plaintiff’s injury.  Mrs. Meade testified that she never read the package insert or any other documents accompanying her metoclopramide prescription.  Dr. Parsley likewise testified that she did not read the metoclopramide warning. And while Dr. Parsley did read the PDR for
the brand name version of the drug, it is undisputed that the defendant did not create that PDR.

The more interesting part of the opinion for our readers is the treatment of the issue of general causation.  It seems that none of plaintiffs’ retained experts offered any opinions regarding general
causation. So plaintiffs were left to argue that several of Mrs. Meade’s treating physicians (whom plaintiffs began referring to as “non-retained experts”) testified regarding the causal link between metoclopramide and tardive dyskinesia. None of these non-retained experts provided written
reports, and in deposition none of these physicians testified directly as to general causation. They assumed causation as a prelude to a specific causation opinion, but this mere assumption does not establish general causation. The law is clear that a mere possibility of causation and, more
specifically, indeterminate expert testimony on causation that is based solely on possibility is not sufficient to allow a reasonable juror to find causation. 

As an alternative basis for general causation, plaintiffs tried to rely on the fact that defendant's own package inserts and brand name warnings refer to a "causal link” between metoclopramide and tardive dyskinesia. Plaintiffs could cite no authority for the proposition that a plaintiff in a pharmaceutical products liability case can satisfy his or her burden of proving general causation by relying on the defendant manufacturer’s drug label warnings. Moreover, this contention was undermined by the general principle that causation evidence in toxic tort cases must be in the form of expert scientific testimony.  PLIVA’s drug label, which merely warns of metoclopramide’s potential side-effects without explaining the scientific basis for the warning, was no substitute for expert testimony that establishes causation in terms of reasonable probability.

Third, plaintiffs also tried to cite, as evidence of general causation, the subsequent FDA directive requiring drug manufacturers to insert a black box warning on metoclopramide labels to convey a
greater risk of tardive dyskinesia. The court, as have several other courts have, however, rejected reliance on agency determinations as a basis for general causation. Inasmuch as the cost-benefit balancing employed by the FDA differs from the threshold standard for establishing causation in tort actions, this court likewise concluded that the FDA-mandated tardive dyskinesia warning cannot establish general causation.

 Summary judgment granted.

Use of Contingency Fee Private Counsel Appealed

A variety of business groups have weighed in as amici, asking the Supreme Court to recognize how contingency fee arrangements by California counties and cities pursuing lead paint litigation violated the due process rights of the defendants. Atlantic Richfield Co. v. County of Santa Clara, No. 10-546 (U.S., amicus curiae brief submitted 11/24/10).

Readers may recall our previous posts about how the California supreme court had taken a major step backward by modifying a 1985 decision that had limited the power of government agencies to retain private plaintiffs attorneys on a contingency fee basis to prosecute nuisance litigation. County of Santa Clara v. The Superior Court of Santa Clara County, No. S163681 (Cal. 7/26/10).

A group of public entities composed of various California counties and cities were prosecuting a public-nuisance action against numerous businesses that manufactured lead paint. Defendants moved to bar the public entities from compensating their privately retained counsel by means of contingent fees. The lower court, relying upon People ex rel. Clancy v. Superior Court, 39 Cal.3d 740 (1985), ordered that the public entities were barred from compensating their private counsel by means of any contingent-fee agreement, reasoning that under Clancy, all attorneys prosecuting public-nuisance actions must be “absolutely neutral.”

The state supreme court acknowledged that Clancy arguably supported defendants' position favoring a bright-line rule barring any attorney with a financial interest in the outcome of a case from representing the interests of the public in a public nuisance abatement action. The court proceeded to engage in a reexamination of the rule in Clancy, however, finding it should be "narrowed," in recognition of both (1) the wide array of public-nuisance actions (and the corresponding diversity in the types of interests implicated by various prosecutions), and (2) the different means by which prosecutorial duties may be delegated to private attorneys supposedly without compromising either the integrity of the prosecution or the public's faith in the judicial process.

The state court had previously concluded that for purposes of evaluating the propriety of a contingent-fee agreement between a public entity and a private attorney, the neutrality rules applicable to criminal prosecutors were equally applicable to government attorneys prosecuting certain civil cases. The court had noted that a prosecutor's duty of neutrality stems from two fundamental aspects of his or her employment. As a representative of the government, a prosecutor must act with the impartiality required of those who govern. Second, because a prosecutor has as a resource the vast power of the government, he or she must refrain from abusing that power by failing to act evenhandedly.

But then, the court concluded that to the extent Clancy suggested that public-nuisance prosecutions always invoke the same constitutional and institutional interests present in a criminal case, that analysis was "unnecessarily broad" and failed to take into account the wide spectrum of cases a state may bring. The court described a range of cases; criminal cases require complete neutrality. In some ordinary civil cases, neutrality is not a concern when the government acts as an ordinary party to a controversy, simply enforcing its own contract and property rights against individuals and entities that allegedly have infringed upon those interests. The nuisance cases fall between these two extremes on the spectrum of neutrality required of a government attorney. The case was not an “ordinary” civil case in that the public entities' attorneys were appearing as representatives of the public and not as counsel for the government acting as an ordinary party in a civil controversy. The case was being prosecuted on behalf of the public, and, accordingly, the concerns identified in Clancy as being inherent in a public prosecution were, indeed, implicated.

But, despite that, state supreme court found that the interests affected in this case were not similar in character to those invoked by a criminal prosecution or the nuisance action in Clancy. The case would not have resulted in an injunction that prevents the defendants from continuing their current business operations. The challenged conduct (the production and distribution of lead paint) has been illegal in the state since 1978. Accordingly, whatever the outcome of the litigation, no ongoing business activity would be enjoined. Nor would the case prevent defendants from exercising any First Amendment right. Although liability may be based in part on prior commercial speech, the remedy would not involve enjoining current or future speech, said the court.

While a heightened standard of neutrality was required for attorneys prosecuting public-nuisance cases on behalf of the government, that heightened standard of neutrality is not always compromised by the hiring of contingent-fee counsel to assist government attorneys in the prosecution of a public-nuisance abatement action. Use of private counsel on a contingent-fee basis is permissible in such cases if neutral, conflict-free government attorneys retain the power to control and supervise the litigation.

In so finding, the court downplayed the reality that the public attorneys' decision-making conceivably could be influenced by their professional reliance upon the private attorneys' expertise and a concomitant sense of obligation to those attorneys to ensure that they receive payment for their many hours of work on the case.To pass muster, neutral government attorneys must retain and exercise the requisite control and supervision over both the conduct of private attorneys and the overall prosecution of the case. Such control of the litigation by neutral attorneys supposedly will provide a safeguard against the possibility that private attorneys unilaterally will engage in inappropriate prosecutorial strategy and tactics geared to maximize their monetary reward. .

The list of specific indicia of control identified by the state supreme court seem quite strained, however, and to elevate form over substance, and written agreements over human nature. The authority to settle the case involves a paramount discretionary decision and is an important factor in ensuring that defendants' constitutional right to a fair trial is not compromised by overzealous actions of an attorney with a pecuniary stake in the outcome.  In reality, even if the control of private counsel by government attorneys is viable in theory, it fails in application because private counsel in such cases are hired based upon their expertise and experience, and therefore always will assume a primary and controlling role in guiding the course of the litigation, rendering illusory the notion of government “control”.

Defendants are seeking cert review. In amicus filings, various trade organizations including the American Chemistry Council, the American Coatings Association, and the National Association of Manufacturers, have argued that the financial incentives inherent in contingency-fee agreements simply distort the decision-making of both the government lawyers and the private attorneys they retain. Inadequately grounded contingency fee arrangements distort the state's duty of even-handedness not only to defendants, but also to the public.  The amici argue that public nuisance cases are not typical tort lawsuits because they claim to be pursued in the public interest. It violates due process for the type of personal financial assessment made by contingency fee private lawyers impacts the decisions in a public nuisance action brought in the government's sovereign capacity. The briefing also raises another important practical issue: the attorney-client privilege and work-product doctrines will block any meaningful inquiry into whether the government is actually exercising the appropriate control that he state court said would solve these issues.

CPSC Approves Product Safety Database Rule

The U.S. Consumer Product Safety Commission last week gave final approval to the controversial
new consumer product safety database, overriding very real concerns about who should be permitted to submit incident reports and how they will be verified as accurate. Readers may know that Section 212 of the Consumer Product Safety Improvement Act of 2008 (‘‘CPSIA’’) amended the Consumer Product Safety Act (‘‘CPSA’’) to require the Commission to establish and maintain a publicly available, searchable database on the safety of consumer products, and other products or substances regulated by the Commission.

CPSC commissioners split along party lines in the 3-2 vote, which came after  a final discussion of whether the regulation would simply give certain interest groups a new forum to attack product makers and plaintiff lawyers a new tool, giving rise to lawsuits based on a rumor repeated through the echo chamber of the Internet.

The rule will give consumers access to reports of alleged product-related safety incidents via a new publicly accessible database.  Consumers, government agencies, and various public health and safety interest groups will be able to post largely self-verified reports related to the safety of any product regulated by the CPSC.

Manufacturers will have limited control over what information can be removed or amended once posted.  The two dissenting votes made an unsuccessful attempt to amend the final rule so as to give manufacturers more time to comment on or respond to the accuracy of postings before they are published to the database and to the public. 

The database will be accompanied by a weak disclaimer stipulating that CPSC has not verified the accuracy of any report.  But the Democratic commissioners rejected any system by which the CPSC could investigate obviously questionable claims and find out the origin of such reports before allowing the public to see and use them.   We posted about these very issues last Spring, and argued that the CPSC had not fully addressed them.  It still seems that insufficient attention has been paid by the majority commissioners to legitimate issues of a manufacturer's goodwill and reputation, to the costs of unnecessary panic among product consumers, and the mischief that plaintiffs' lawyers might cause with unwarranted increase in litigation against manufacturers.

Accordingly, a product seller may only make a comment in response to the report of harm, which may be published; claim the report of harm contains confidential business information, triggering a CPSC review of the claim; and/or claim the report of harm contains materially inaccurate information (e.g., that it is not the manufacturer or private labeler of the product), triggering a CPSC review of the claim. Materially inaccurate information is narrowly defined to include information that is false or misleading and relates to a matter which is so substantial and important as to affect a reasonable consumer’s decision making about the product. 

CPSC is expected to have the database go live at www.saferproducts.gov in March, 2011. In the meantime, the Commission plans to start outreach on business portal registration and features; conduct workshops with manufacturers and private labelers; offer training webinars; and finalize the new incident report form.

Food Safety Bill Passes Senate

An update on the food safety legislation, which we posted about last week.

The Senate passed the Food Safety Modernization Act by a vote of 73-25. The chamber rejected a series of final amendments. One of them would have replaced the entire bill with a more modest version authored by Sen. Tom Coburn, R-Okla.; it failed by a 62-36 vote. 

Despite bipartisan support for an overhaul of FDA’s authority to regulate food, the bill faces an uncertain future since it appears there is insufficient time for a conference to reconcile the House and Senate versions.The Senate legislation differs from the House version in several respects, including the fees the FDA can charge, regulation of small food businesses and farms, and frequency of required inspections. It may be that the House will vote to pass the Senate version.  There is also some concern that the Senate invaded the tax authority that belongs to the House when it included revenue-raising fees in the Senate bill.

The expanded inspections and recall authority may lead to additional litigation down the road involving the food industry.