Mass Tort Defense : Mass Tort Defense Lawyer & Attorney : Sean P. Wajert : Dechert Law Firm : Products Liability, Class Actions, Pharmaceutical Litigation

A federal court has denied class certification in a proposed consumer fraud class action arising from the sale of microwave popcorn with artificial butter flavoring. See Courtney Fine v. Conagra Foods, Inc., No. CV 10-01848 SJO (C.D. Calif., Aug. 27, 2010).

The facts: Diacetyl is a naturally occurring chemical in butter, and was also used in artificial butter flavors for decades. In 2007 defendant Conagra, maker of microwave popcorn, issued a press release to the public stating it was no longer adding the compound diacetyl, which has been associated with lung injury in factory workers exposed to high doses, to its butter-flavored microwave popcorn products. Since the announcement, defendant "reformulated" all butter-flavored varieties of Orville Redenbacher's and Act II microwave popcorn in response, it said, to consumer uncertainty regarding the ingredients of the microwave popcorn. Conagra also redesigned the packaging for these products to display the words "No Added Diacetyl."

Plaintiff alleged that she understood the advertising claim to be there was no diacetyl in the new popcorn, as opposed to no added diacetyl, and alleged she relied on defendant's claims that there was "no diacetyl" in the popcorn products when making the purchases. Plaintiff asserted, however, that diacetyl is still present in the products (as part of natural butter). Plaintiff further asserted that had she known the representation regarding the diacetyl was false, she would not have made the purchases.

Plaintiff alleged causes of action for: (1) false and misleading representation of material facts, constituting unfair competition within the meaning of California Business & Professions Code §§ 17200, et seq. ("UCL"); and (2) false advertising in violation of Business & Professions Code §§ 17500, et seq. ("FAL"). She further alleged that she suffered a monetary loss as a result of defendant's alleged actions, which were in violation of the Consumer Legal Remedies Act ("CLRA"), Cal. Civ. Code §§ 1750, et seq.

Last March, Conagra removed the case from state court to federal (Judge Otero). Then they filed a Motion to Dismiss based on various grounds, including that: (1) Plaintiff does not allege a cognizable injury resulting from defendant's products and therefore lacks standing; (2) Plaintiff fails to state a claim under the UCL, FAL, and CLRA as a matter of law under Rule 12(b)(6). The gist of the final argument was that plaintiff "received exactly what she paid for."  But, the court was persuaded that plaintiff adequately asserted that she did not get what she paid for, as she was under the impression that defendant's popcorn products were free of diacetyl. That is, she asserted that Conagra’s placement of "No Diacetyl Added" on the packaging is a material misrepresentation, and that reasonable consumers could (somehow) have taken the label to mean that diacetyl did not exist in the product at all.

Plaintiffs then moved for certification of a class consisting of all persons residing in the state of California who purchased Orville Redenbacher's brand Light Butter, Movie Theater Butter Light microwave popcorn, and/or ACT II brand 94% Fat Free Butter, Light Butter, and Butter Lover's microwave popcorn for personal use and not for resale since September 1, 2007. Plaintiff sought certification under Rule 23(b)(3) and 23(b)(2), but argued her "primary goal is to obtain injunctive relief by way of an order enjoining Defendant from its continued practice of making misleading advertising and label claims about its butter flavored microwave popcorn products."

The court denied the motion for class certification on three related grounds. The first problem was that in the court's prior Order Denying Defendant's Motion to Dismiss (6/29/10), the court had ruled that plaintiff established standing for herself because she alleged that she incurred injury as a result of defendant's allegedly improper conduct. That is, plaintiff's spending money on defendant's popcorn in reliance of defendant's placing "No Added Diacetyl" on the packaging.

In the class Motion, plaintiff sought to certify a class that includes "all persons residing in the State of California who purchased [Defendant's] popcorn for personal use and not for resale since September 1, 2007."  Named plaintiff made no mention of the proposed class being comprised only of members who made the purchase as a result of defendant's allegedly false statements, which would be necessary in order to establish standing for the rest of the class.  The court noted that other courts have held that class definitions should be tailored to exclude putative class members who lack standing; each class member need not submit evidence of personal standing but, nonetheless, a class must be defined in such a way that anyone within it would have standing. Burdick v. Union Sec. Ins. Co., 2009 WL 4798873, at *4 (C.D. Cal. 2009).

Accordingly, class certification was improper here, given that plaintiff's proposed class included many people who may not have relied on defendant's alleged misrepresentations when making their purchasing decisions.

Second, a related problem was the Rule 23(a) requirement that plaintiff’s claims be typical of the class claims. The court agreed with Conagra that plaintiff failed to adduce facts suggesting that other class members have been injured by the same course of conduct that she asserts injured her. There could be no serious question, said the court, that the vast majority of putative class members here never read (let alone considered) the defendant's statement at issue, do not know what diacetyl is, and did not base their popcorn purchases on diacetyl-related issues. Plaintiff purchased popcorn, she said, because of defendant's allegedly misleading statements regarding diacetyl. Plaintiff's injury was established due to her alleged reliance on defendant's statements. But plaintiff sought to certify a class that would likely include people with varying rationales behind their purchases – many who purchased popcorn based on factors like flavor or brand. Plaintiff thus failed to establish that she could be a typical representative of the class, whose members were buying for all sorts of reasons unrelated to diacetyl.

Third, because the court found that plaintiff was not a typical representative, the court also held that plaintiff was not an adequate representative under Rule 23(a)(4).

What is refreshing about this short opinion is the recognition that Rule 23(a) matters too.  Often we see courts giver very cursory analysis of the (a) elements and/or emphasize that regardless of the initial prerequisites the issues of predominance, manageability and superiority dictate the certification result.  While the fact that class members undoubtedly bought microwave popcorn for many reasons would impact predominance of individual issues, it also does in fact suggest that the class representative's claims were not typical of the the class, as defined.

(NB. Your humble blogger is involved in the diacetyl litigation, but not this case.)

 

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Couple of interesting issue being debated in the Gulf Oil Spill Litigation.  In re: Oil Spill by the Oil Rig "Deepwater Horizon" in the Gulf of Mexico on April 20, 2010, MDL-2179 (E.D. La.).

The first concerns control over the testing of key components of the rig, once they are recovered.  Readers know how important such testing can be in supporting or refuting causation theories. But the very act of testing, even if not destructive, potentially alters the condition of the product.  Who goes first; what tests get run in what order; who does the testing; how tests are done... all of these can be vitally important issues in accident investigation and product liability litigation.

Defendant Transocean Ltd. unit has asked the judge in the MDL to grant a motion for a protective order that would block the government's apparent plan to unilaterally control testing of the oil rig's blowout preventer. Press reports suggest the blowout preventer could be recovered from the Gulf floor in the near future. Transocean Offshore Deepwater Drilling Inc. and several other defendants thus filed a motion last week in the U.S. District Court for the Eastern District of Louisiana for an expedited hearing on the protective order covering the blowout preventer.

The federal government has indicated that it wants to take exclusive control of the blowout preventer, transport it to a government site, and then contract for forensic testing and analysis. The motion argues that while the government has solicited input from other parties on testing protocol, it never said it would pay attention to any of those suggestions.

The second issue is a battle between Transocean and co-defendant BP over document discovery. Transocean attorneys are claiming that BP has been withholding documents and limiting Transocean's access to sensitive information connected to the accident, including records of tests on the blowout preventer, lab reports on components of the rig such as the well cement mix, and data on equipment used to keep well pipes in place during cementing.  BP, for its part, calls the claim a "publicity stunt” designed to divert attention from Transocean's alleged role in the accident.  BP claims it has already turned over thousands of pages of documents, including materials on the initial exploration plan, lab tests and daily drilling reports, and mud log reports.

Third, the American Petroleum Institute and other parties who are defendant-intervenors have asked the MDL judge to remand one of the many coordinated cases.  Gulf Restoration Network et al. v. Salazar et al.  This one is the suit brought by environmental groups against the federal government, and the argument is that it is fundamentally different from the other cases because it focuses on administrative law issues regarding the government’s approval of offshore drilling plans.

The Gulf Restoration Network, along with the Sierra Club, accused the U.S. Department of the Interior of ignoring environmental regulations when it allegedly waived safety regulations to allow BP and Transocean to conduct offshore drilling exploration in the Gulf of Mexico.

The discovery for negligence claims at the core of the MDL, these moving parties assert, will not materially assist or advance a case that stems from the legal issue whether the federal government took proper steps in granting the companies the offshore drilling exploration permits.  In fact, the argument goes, keeping Gulf Restoration in the MDL would unreasonably delay what would normally be a quick resolution to an administrative law action.

 

 

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A state appeals court has ruled that an employer may face liability under New Jersey law for allegedly exposing a plaintiff to asbestos through contact with her husband's work clothes, even if she also had worked for the employer as a direct employee herself. See Anderson v. A.J. Friedman Supply, et al., No. A-5892-07T1 (N.J. Super. Ct. App. Div.,  8/20/10).

Plaintiffs alleged that Bonnie Anderson contracted mesothelioma from one or both exposures to asbestos at the Linden Bayway Refinery owned by defendant Exxon Mobil Corporation (and home of the state's largest Christmas tree apparently).  The first was bystander exposure from laundering her husband John's asbestos-laden work clothes during his employment with Exxon from 1969 to 2003. (In Olivo v. Owens-Illinois Inc., 186 N.J. 394 (2006), the court had found that an employer could be liable for indirectly exposing family members to the asbestos fibers found on a employee's work clothes.)  The second was direct exposure during Bonnie's own employment with Exxon from 1974 to 1986.

At trial, plaintiffs focused on the bystander exposure, and tried to downplay any significant exposure at work.  A defense expert agreed that the only epidemiologically established cause of mesothelioma is asbestos exposure; it is commonly accepted today that it's possible that women can get mesothelioma from asbestos dust brought home on the clothing of a husband or parent; and that mesothelioma has an average latency period of thirty-two years.

The trial court charged the jury that asbestos brought home by John need not be the sole cause of plaintiff's asbestos-related injuries but it must be a substantial contributing factor, and if the jury were to find that Bonnie's exposure occurring during the course of her employment was the sole cause of her injury or disease, it should return a verdict for Exxon.

Exxon appealed  from a judgment in favor of plaintiffs, awarding more than $7 million to the Andersons in compensatory damages.

The appellate court noted that this case presented a novel scenario of a single injury arising after a long latency period caused by one of two, or both, asbestos exposures.  The court of appeals framed the question as whether Mrs. Anderson could continue to assert a claim against Exxon if she was exposed as a result of washing the clothes but she was also an employee with possible direct exposure at that time. 

As to that question, the court turned to the "dual persona doctrine," which under New Jersey law generally provides that an employer may become like a third person, vulnerable to tort suit by an employee, outside the normal bar of the exclusivity of the workers comp system, if and only if it possesses a second persona so completely independent from and unrelated to its status as employer that by established standards the law recognizes that persona as a separate legal person.

The court could find no close precedents, but one might think that the role of the defendant as employer of husband and wife and its role in the alleged exposure due to the husband's work-related clothing does not rise to the the level of a separate legal person.  But the court affirmed the trial court's reasoning that Exxon was such a dual persona, having an employer capacity for an eight year period, but then having a separate "relationship" to Mrs. Anderson as a bystander for 20 years. It was thought unfair to the plaintiff not to let her pursue her claim based on her bystander exposure, which had "absolutely nothing" to do with her employment relationship with Exxon.

That is, although Exxon could not be held liable based on her direct occupational exposure, it could be held liable pursuant to her separate exposure to the asbestos brought home by John from his Exxon job.

One might assume that if the employer was a "separate legal person" who was not protected by the workers comp scheme for purposes of the alleged bystander exposure, then at least the defendant could get some recognition on the verdict form of this separate legal entity.  But even though the trial judge viewed Exxon as "standing in two different pairs of shoes," the court refused Exxon's request to have the two legal persons listed on the verdict sheet, and declined to direct the jury to allocate fault between Bonnie's direct asbestos exposure as an Exxon employee and any bystander exposure from washing John's work clothes.

The court of appeals agreed, reasoning that the jury could not allocate any fault to Exxon as Bonnie's employer, because Exxon was immune from suit pursuant to the Workers Comp Act. The state's comparative fault doctrine provides that fault shall be allocated among each "party" in the case. The workers' compensation bar precluded Exxon from being a "party" in this litigation in its status as Bonnie's employer.

Thus, defendants like Exxon get the worst of both worlds: no safe haven under workers comp for having been the employer, but no allocation of fault because they were the employer under the workers comp scheme!

 

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The federal government (Acting Solicitor General Neal Katyal on behalf of the Tennessee Valley Authority, a government-owned company), last week urged the Supreme Court to overturn a court of appeals 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. American Electric Power Co. v. Connecticut, No. 10-174 (U.S., brief filed 8/24/10).

Readers may recall from earlier posts that in Connecticut v. American Electric Power Co., 2009 WL 2996729 (2nd Cir. 9/21/09),  two groups of plaintiffs, one consisting of eight states and New York City, and the other consisting of three land trusts, sued several 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. The plaintiffs' theory is that carbon dioxide acts as a greenhouse gas that traps heat in the earth's atmosphere, and that as a result of this trapped heat, the earth's temperature has risen over the years and will continue to rise in the future. Pointing to an alleged “clear scientific consensus” that global warming has already begun to alter the natural world, plaintiffs predicted that it “will accelerate over the coming decades unless action is taken to reduce emissions of carbon dioxide.”

When thinking about "global climate" changes, MassTortDefense has always been sobered by the fact that humans have been trying to measure temperature consistently only since the1880s, during which time advocates think the world may have warmed by about +0.6 °C -- which is less than the margin of error on our ability to measure the Earth's temperature!

Anyway, 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 held that plaintiffs' claims presented a non-justiciable political question and dismissed the complaints. 406 F. Supp. 2d 265.

On appeal to the Second Circuit, 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, the two judges (Justice, then-Judge Sotomayor had to drop out) held that the district court 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 by other federal law.

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. The Supreme Court has further stated that the asserted injury must be actual or imminent, certainly impending and immediate --not remote, speculative, conjectural, or hypothetical. The court rejected defendants challenge that the contentions of future injury at some unspecified future date are not the kind of “imminent” injury required. The court also gave short shrift to the argument that plaintiffs could neither isolate which alleged harms will be caused by defendants' emissions, nor allege that such emissions would alone cause any future harms.

As we noted here, several defendants have filed a cert petition that raises the important, recurring question whether states and private plaintiffs have standing to seek, and whether federal common law provides authority for courts to impose, a non-statutory, judicially created regime for setting caps on greenhouse gas emissions based on vague and indeterminate nuisance concepts. It also asks the Court to decide whether judges, in addition to Congress and the EPA, may regulate greenhouse gas emissions at the behest of states and/or private parties and, if so, under what standards. Under the Second Circuit's ruling, a single judge could 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 different standards for other utilities or industries, or conflicting standards for these same utilities.

While the Second Circuit called this an ordinary tort suit, this litigation seeks to transfer to the judiciary nearly standard-less authority for some of the most important and sensitive economic, energy, and social policy issues presently before the country. Federal nuisance law is neither sufficiently developed nor sufficiently detailed to substitute for actual regulation. Thus, at stake is the financial health and security of numerous sectors of the economy. Indeed, virtually every entity and industry in the world is responsible for some emissions of carbon dioxide and is thus a potential defendant in climate change nuisance actions under the theory of this case. The threat of litigation, and the indeterminate exposure to monetary and injunctive relief that it entails, could substantially impede and alter the future investment decisions and employment levels of all affected industries, and ultimately every sector of the economy.

Now the government brief takes a different approach, asking the Court not to accept the case for full review, but rather to simply vacate the decision and direct the Second Circuit to reconsider two issues: whether the plaintiffs have standing to bring the lawsuit, and whether recent actions by the EPA  to regulate greenhouse gas emissions supplant the reason given by the Second Circuit for allowing the lawsuit to go forward.  Since the initial decision below, EPA has issued final rules establishing reporting requirements for major emitters of greenhouse gases; issued a finding that greenhouse gas emissions from cars and light trucks endanger public health and welfare; and established new greenhouse gas emissions limits for cars and light trucks. In addition, EPA has signed off on a final rule requiring that additional categories of sources begin to track and report greenhouse gas emissions under EPA's earlier GHG reporting rule.  The Second Circuit decision was seemingly predicated on the "now-obsolete conclusion" that EPA had not taken action to regulate carbon-dioxide emissions from stationary sources. 

The TVA brief also argues that  that the lower court should dismiss the case based on “prudential standing,” a narrower ground than the case or controversy argument of the other defendants.

 

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The Georgia Superior Court has preliminarily approved a $6.5 million settlement between the Lowe's home improvement stores and a nationwide proposed class of drywall purchasers. Vereen v. Lowe's Home Centers Inc., SU10-CV-2267B (Ga. Super. Ct., Muscogee Cty.).

The proposed resolution of this piece of the drywall litigation would provide Lowe's gift certificates ranging from $50 to $2,000 to any consumer who purchased drywall (not just from China), as well as cash awards of up to $2,500, if the claimant can provide documentation of damages and proof of purchase. That is, plaintiffs who provide proof of purchase of drywall from Lowe's but have no proof of actual damages would receive gift cards valued up to $250. Class members unable to provide a proof of purchase would receive $50 gift cards.

Under the settlement, Lowe's also agreed to pay attorneys' fees and expenses up to 30% of the class fund, as well as $1 million to the plaintiff attorneys for administration of claims. The settlement purports to release Lowe's from all drywall claims.The Georgia court conditionally certified a settlement class and set a final fairness hearing for November 19th.

But the proposed settlement has apparently drawn objections from participants in the federal Chinese drywall multidistrict litigation, who are arguing that the settlement fund is too small and that the settlement would interfere with federal jurisdiction.  The plaintiffs' steering committee for the Chinese drywall multidistrict litigation in the Eastern District of Louisiana went so far as to move to enjoin the state court from moving ahead with the settlement, arguing that the benefit to the class is too small, and the attorneys' fees too large. Ironically, these plaintiff attorneys assert that the form of the class benefit, i.e.,  a gift card, is also improper.

The MDL lawyers assert that the parties involved in the MDL have been negotiating towards a global settlement, and allowing the state court, one-defendant settlement to go forward would simply undermine those efforts.  They called on the federal court, pursuant to the Anti-Injunction Act, to enjoin state court proceedings where, as here, it is allegedly necessary in aid of its jurisdiction or to protect or effectuate its judgments.

Readers will recall that after Hurricanes Katrina and Rita in 2005, drywall was imported from China to address a shortage of drywall required for repairs and new construction. After the drywall was installed, homeowners began to complain of smells, gas emanations, corrosion of appliances and electrical fixtures, and other alleged property damage. The lawsuits typically allege that sulfur compound levels in the drywall are too high, causing issues with air conditioning systems, electrical appliances, internal wiring, and other electrical systems in homes. Plaintiffs also allege the drywall produces a rotten egg-like stench and causes a variety of respiratory and other health problems for those who live in the affected homes.

So far, a few bench or jury bellwether trials have been completed, with mixed results.
 
 

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Several electric power companies have asked the Supreme Court to review a Second Circuit ruling that Connecticut and several other states may seek greenhouse gas emissions reductions under a federal common law nuisance claim.  American Electric Power Co. v. Connecticut, No. 10-174 (U.S. 8/2/10). The petition for certiorari was filed by American Electric Power Co., Duke Energy Corp., Southern Co., and Xcel Energy Inc.

Readers may recall that in 2004, 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.

Because of the procedural posture (motion to dismiss), the court did not really describe the other side of the story, but readers of MassTortDefense know that change is what the climate is always doing as a result of the planet's orbital eccentricities, axial wobbles, solar brightness changes, cosmic ray flux, and multiple other factors. There are numerous plausible terrestrial drivers of climate changes too. While global warming is a serious topic worthy of scientific study and political discussion, plaintiffs' alleged "consensus" on this issue ignores the fact that global mean temperature is only one part of climate, and may not even be the best metric. Moreover, the most important driver of the greenhouse effect are water vapor and clouds. Carbon dioxide is only about 0.038% of the atmosphere, and humans are responsible for only about 3.4% of carbon dioxide emitted to the atmosphere annually, the rest of it being natural.  When thinking about "global climate" changes, we have to be cognizant of the fact that humans have been trying to measure the temperature consistently only since the1880s, during which time even advocates think the world may have warmed by about +0.6 °C -- which is less than the margin of error on our ability to measure the Earth's temperature. 

Anyway, 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 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, the court of appeals held that the district court 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. The Supreme Court has further stated that the asserted injury must be actual or imminent, certainly impending and immediate --not remote, speculative, conjectural, or hypothetical. The court of appeals rejected defendants challenge that these vague contentions of future injury at some unspecified future date are not the kind of “imminent” injury required. The court also gave short shrift to the argument that plaintiffs could neither isolate which alleged harms will be caused by defendants' emissions, nor allege that such emissions would alone cause any future harms. 

This petition raises the important, recurring question whether states and private plaintiffs have standing to seek, and whether federal common law provides authority for courts to impose, a non-statutory, judicially created regime for setting caps on greenhouse gas emissions based on vague and indeterminate nuisance concepts.  It also asks the Court to decide whether judges, in addition to Congress and the EPA, may regulate greenhouse gas emissions at the behest of states and private parties and, if so, under what standards.  Under the Second Circuit's ruling, a single judge could 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 different standards for other utilities or industries, or conflicting standards for these same utilities.

While the Second Circuit called this an ordinary tort suit, this litigation seeks to transfer to the judiciary nearly standardless authority for some of the most important and sensitive economic, energy, and social policy issues presently before the country.  Thus, at stake is the financial health and security of numerous sectors of the economy. Indeed, virtually every entity and industry in the world is responsible for some emissions of carbon dioxide and is thus a potential defendant in climate change nuisance actions under the theory of this case. The threat of litigation, and the indeterminate exposure to monetary and injunctive relief that it entails, could substantially impede and alter the future investment decisions and employment levels of all affected industries, and ultimately every sector of the economy.

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The Judicial Panel on Multidistrict Litigation yesterday selected New Orleans as the site of the oil spill litigation MDL. The Panel ordered coordination, and transferred 77 lawsuits to the Eastern District of Louisiana before U.S. Judge Carl J. Barbier (and referred to more than 200 potential tag along actions). In Re: Oil Spill by the Oil Rig "Deepwater Horizon" in The Gulf of Mexico, MDL No. 2179 (Aug. 10, 2010). 

In its order, the Panel found that the cases indisputably share factual issues concerning the cause (or causes) of the Deepwater Horizon explosion/fire and the role, if any, that each defendant played in it. Centralization under Section 1407 would eliminate duplicative discovery, prevent inconsistent pretrial rulings, including rulings on class certification and other issues, and conserve the resources of the parties, their counsel, and the judiciary. Interestingly, the Panel noted that centralization may also facilitate closer coordination with Kenneth Feinberg’s administration of the BP compensation fund.

Over some objections, the Panel also concluded that it made sense to include the personal injury/wrongful death actions in the MDL. While these actions will require some amount of individualized discovery, in other respects they overlap with those that pursue only economic damage claims, found the Panel. The Order notes that the transferee judge has broad discretion to employ any number of pretrial techniques – such as establishing separate discovery and/or motion tracks – to address any differences among the cases and efficiently manage the various aspects of this litigation. See, e.g., In re Lehman Brothers Holdings, Inc., Securities & Employee Retirement Income Security Act (ERISA) Litigation, 598 F.Supp.2d 1362, 1364 (J.P.M.L. 2009). 

In terms of where the cases should be coordinated, the Panel noted that the parties advanced sound reasons for a large number of possible transferee districts and judges. They settled upon the Eastern District of Louisiana as the most appropriate district for this litigation. Without discounting the spill’s effects on other states, the Panel concluded that "if there is a geographic and psychological center of gravity in this docket, then the Eastern District of Louisiana is closest to it."

In selecting Judge Barbier, the Panel expressly declined the suggestion made at oral argument that, given the litigation’s scope and complexity, it should assign the docket to multiple transferee judges. "Experience teaches," said the Panel, that most, if not all, multidistrict proceedings do not require the oversight of more than one judge, provided that he or she has the time and resources to handle the assignment. Moreover, Judge Barbier has at his disposal all the many assets of the Eastern District of Louisiana which is accustomed to handling large MDLs. Judge Barbier may also, found the Panel, choose to employ special masters and other case administration tools to facilitate certain aspects of the litigation. See Manual for Complex Litigation, Fourth §§ 11.52, 11.53 (2004).

 

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The Subcommittee on Commerce, Trade, and Consumer Protection  of the House Committee on Energy and Commerce held a hearing on H.R. 5820, the “Toxic Chemicals Safety Act of 2010,” last week.  The proposed legislation would amend the Toxic Substances Control Act of 1976 to deal with potential risks resulting from chemical exposure.

Witnesses included Steve Owens from the EPA; Calvin M. Dooley, President and Chief Executive Officer of the  American Chemistry Council; and Beth Bosley, Society of Chemical Manufacturers and Affiliates, Inc.

Any approach toward updating federal chemical regulation should balance safety issues with the need to preserve the ability of the United States to serve as the innovation engine for the world; and protect the hundreds of thousands of American jobs fueled directly and indirectly by the business of chemistry.  That is, reforming TSCA to enhance the safety assessment of chemicals while maintaining the ability of the U.S. chemical industry to be the international leader in innovation and manufacturing.

It is clear that the standards established in this bill sets an impossibly high hurdle for all chemicals in commerce, and are guaranteed to produce significant technical, bureaucratic and commercial barriers. For example, the bill requires that “aggregate exposure” to a chemical or a mixture meet the “reasonable certainty of no harm” standard. This apparently means that when a chemical or mixture is listed for a safety determination, the manufacturer carries the burden of showing with reasonable certainty not just that the company’s use of the chemical and any resulting exposures from those uses pose no significant risk of harm, but that all other aggregated exposures from all other uses of the chemical pose no harm. It is not clear to MassTortDefense how any company could actually do that in the real world.  TSCA regulates thousands of chemicals, many with hundreds of uses. TSCA chemicals have multiple important industrial applications and consumer product applications. It is totally unclear how industry or even the EPA would be able to gather enough information to meet this aggregate exposure standard for each and every regulated substance.

The proposed bill thus creates a burden that seems far out of proportion to its benefit. The onslaught of new regulations may simply force customers of the industry to relocate their factories and make the products at issue overseas, outside the EPA's jurisdiction.  The bill would also  discourage the introduction of new chemicals, including new greener chemicals, into commerce in the United States.  Congress, keep working at it.
 

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The U.S. Judicial Panel on Multidistrict Litigation heard oral argument last week on the issue of consolidating the hundreds of cases arising from the Gulf oil spill. In re: Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico,  MDL No. 2179.

The MDL panel met this time in Boise, Idaho, and suspended the usual rule limiting oral
argument to 20 minutes.  Multiple attorneys representing the various parties in the pending cases addressed the panel.  Most defendants urged the cases be coordinated in the Southern District of Texas, while most plaintiffs, including some of the restaurant owners and fishermen affected by the spill, argued for the Eastern District of Louisiana, asserting that much of the injury/damages is centered there. A  few other plaintiffs pushed for the cases to be coordinated in Mississippi, Alabama, or Florida courts.

BP argued that the Texas forum was appropriate because this defendant's headquarters, documents, and key fact witnesses are all located there. The government wants the cases consolidated in New Orleans. But one issue is that 8 federal judges, including several in Louisiana, have recused themselves from the spill cases.  This led to discussion whether potential judicial conflicts should compel the panel to bring in a judge from outside the Gulf states. In New Orleans, the Eastern District of Louisiana has consolidated its 50+ oil spill cases before Judge Carl J. Barbier, who has issued interim case management orders and appointed interim liaison counsel for plaintiffs and defendants.  Some have argued this has effectively created an administrative framework that could be utilized were the Panel to send the MDL to New Orleans.

At last look, federal cases were spread around the country, including in New York and California and Illinois.  However, the busiest oil spill dockets are in the Eastern District of Louisiana, Southern District of Texas, Southern District of Alabama, and the three Florida district courts, each with more than 10 cases. 

As noted here, the litigation involves a wide variety of claims, from personal injury, to property or environmental damages, lost profits, and securities-based economic injury.  The panel asked whether the cases, even if consolidated, should be put in separate groupings.  Some plaintiffs' attorneys  argued it was particularly important to set up a separate track for personal-injury claims.  

 

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A federal judge has issued an opinion explaining her Daubert and summary judgment rulings in a case brought by a consumer who alleged he contracted lung disease from the fumes of microwave popcorn. Newkirk et al. v. ConAgra Foods Inc., No. 2:08-cv-00273 (E.D. Wash. 7/2/2010).

Readers of MassTortDefense may be familiar with the so-called "popcorn lung" litigation in which plaintiffs have alleged they contracted a series of diseases, including Bronchiolitis obliterans, from inhaling the chemical diacetyl which had been used in the artificial butter on microwave popcorn.  Most of the claims have been made by workers with alleged industrial-level exposures on a daily basis in popcorn factories several years ago.  There are, however, a handful of cases by consumers claiming they somehow had sufficient exposure in their homes to have the same respiratory injuries.  These latter cases raise significant issues of general and specific causation, arising from the central tenet of toxicology: the dose makes the poison.  The studies relied on by plaintiffs noted that the cumulative exposure to diacetyl was correlated with chronic effects on lung function in plant workers.

Plaintiff Newkirk claimed that the natural and artificial butter flavoring in ConAgra's Act II Butter and Act II Butter Lovers popcorn products caused him severe and progressive damage to the respiratory system, extreme shortness of breath, and reduced life expectancy.  He claimed that he ate between five and seven bags of ConAgra's popcorn every day for more than a decade.

The motions centered around plaintiff's burden to prove causation. Plaintiffs in toxic tort cases must establish both general and specific causation. Golden v. CH2M Hill Hanford Group, Inc., 528 F.3d 681, 683 (9th Cir.2008). Evidence supporting general causation addresses “whether the substance at issue had the capacity to cause the harm alleged.” In re Hanford Nuclear Reservation Litigation, 292 F.3d 1124, 1133 (9th Cir.2002). Specific causation, by contrast, concerns whether a particular individual suffers from a particular ailment as a result of exposure to the substance. Defendants challenged plaintiff's proof of both under Daubert.

Plaintiffs retained Dr. Egilman to offer an opinion on general causation, as well as to examine Mr. Newkirk, diagnose him, and offer an opinion regarding the specific cause of his condition. The expert opinion testimony of Dr. Egilman was the plaintiffs’ primary evidence supporting general causation. (All of the Newkirks’ other causation expert witnesses assumed that general causation already has been established.)  He opined that,  “There is no known safe level of diacetyl exposure. Existing scientific studies also suggest that levels of diacetyl exposure below and around 1 ppm can cause BO and other respiratory illnesses.”

The court found, however, that Dr. Egilman's attempt to analogize kitchen to industrial exposures failed. He offered no sufficient basis or methodology for support for the conclusion that there is no important (medically relevant) qualitative difference between the vapor from butter flavoring slurry in a mixing vat in a popcorn plant and the vapor from butter flavoring that is emitted from microwave popcorn in the home. There was nothing to support Dr. Egilman’s conclusions that were at the heart of this case: that the vapors emitted from a microwave popcorn bag contain the same proportion of chemicals or in sufficient doses or that all of the substances in the two instances are identical. In other parts of his reports and testimony, the court found, Dr. Egilman relied on some existing data, mostly in the form of published studies, but drew conclusions far beyond what the study authors concluded.

Or, Dr. Egilman manipulated the data from those studies to reach misleading conclusions of his own. Slip opin. at 25. For example, he relied on statements by a Dr. Cecile Rose, on a patient (and another consumer plaintiff), Mr. Watson, who allegedly contracted disease from popcorn fumes. But this was in the nature of a single case report, and in it even Dr. Rose did not assert that her conclusions could be extrapolated to other consumers in the absence of publication or peer review; Dr. Egilman acknowledged that Dr. Rose did not publish the exposure levels measured in Mr. Watson’s home -- so no such comparison was possible.  Dr. Rose herself qualified her conclusions: “It is difficult to make a causal connection based on a single case report. We cannot be sure that this patient’s exposure to butter flavored microwave popcorn from daily heavy preparation has caused his lung disease.” 
 

The expert also relied on testing conducted by Dr. John Martyny in a kitchen (not of a consumer), despite that doctor's own reflections that the methodology underlying the work could not support extrapolating to general causation for a broader group of consumers.  The expert also relied on animal studies. Expert opinion relying on animal studies to reach an opinion on causation in humans is usually admissible only when the expert explains how and why the results of the animal toxicological study can reliably be extrapolated to humans. General Electric Co. v. Joiner, 522 U.S. 136, 143-45 (1997).  Dr. Egilman offered no such analytical bridge between the animal studies finding harm from high levels of diacetyl exposure to lab rats and his conclusion that those studies demonstrate that diacetyl exposure causes decreased lung function in humans. He offered no sufficient explanation for how and why the results of those studies could be extrapolated to humans, let alone low-dose consumer contexts.

Without Dr. Egilman's testimony to support causation, the plaintiffs' other expert witnesses couldn't establish this element either.

Note also that the court excluded Dr. Egilman's "legal conclusions" from his expert report and affidavits, since the witness was no more capable than the fact-finder to draw such a conclusion. See Nationwide Transp. Fin. v. Cass Info. Sys., 523 F.3d 1051, 1059-60 (9th Cir.2008) (expert witness cannot give an opinion as to her legal conclusion, i.e., an opinion on an ultimate issue of law). For example, Dr. Egilman tried to opine that about what the defendant "knew" and "failed to warn" consumers. This is another useful precedent against plaintiffs' mis-use of the conduct "expert" who provides mere legal conclusions and invades the province of the jury.

(Dechert is involved in the diacetyl litigation, but not this case.)

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Late last month, the Environmental Protection Agency signed off on a final rule requiring that  additional categories of sources begin to track and report greenhouse gas emissions under EPA's earlier GHG reporting rule.

Readers will recall the original rule, published in October, 2009, regulated 41 kinds of sources of methane, carbon dioxide, and nitrous oxide ,and other GHG emissions, requiring reporting when the rule becomes effective.  The new rule adds Magnesium Production, Underground Coal Mines, Industrial Wastewater Treatment, and Industrial Landfills, to the list of sources that have reporting requirements.  With this final rule the Agency has taken action on all outstanding source categories and subparts from the April 2009 original proposal for the greenhouse gas reporting program.

EPA promulgated the regulations to require monitoring and reporting of various major greenhouse gas emissions. In general, this national greenhouse gas reporting program is supposed to  provide EPA with accurate and timely GHG emissions data from facilities that emit 25,000 metric tons or more of carbon dioxide equivalent (CO2e) per year. This data is supposed to provide a better understanding of where GHGs are coming from and will guide development of the best possible policies and programs to reduce emissions, says the EPA.

Underground coal mines, magnesium production facilities, industrial waste landfills and industrial wastewater treatment facilities that meet the reporting threshold must begin monitoring GHG emissions on January 1, 2011 and must submit the first annual report to EPA by March 31, 2012. These GHG reporting rules are genearaly viewed as the first steps toward implementing GHG emissions limits and related climate change regulations. 

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Last week, the California Assembly’s Committee on Environmental Safety and Toxic Materials approved the Consumer Right to Know Act, S.B. 928.  The bill passed the California State Senate last April, and is currently pending in the California Assembly’s Committee on Appropriations.

This bill would ban the manufacture, sale, or distribution of certain consumer products unless the manufacturer publishes a comprehensive list of ingredients on a publicly available website and directs consumers to a web address on the product’s label. The ingredients would have to be identified with a Chemical Abstract Service (CAS) number. Additionally, they should be identified by either the Consumer Specialty Products Association Consumer Product Ingredients Dictionary (CSPA dictionary) name or the International Nomenclature Cosmetic Ingredient (INCI) name.

As originally drafted, the bill applied to all consumer products as defined by the federal Consumer Product Safety Act. As amended, the current bill applies only to “designated consumer products.” So far, those products include: air care products, automotive products, cleaning products, and polish or floor maintenance products. But, according to observers, the scope of products is under review and could be changed by the legislature before enactment.

One huge issue with the bill is its inadequate protection for legitimate intellectual property, including trade secret information.

As it is currently drafted, S.B. 928 purports to protect trade secrets from disclosure, but it also restricts this ostensible protection in several problematic ways.

• First, “hazardous” ingredients cannot be trade secrets for purposes of the bill. And the bill has an overbroad broad definition of “hazardous.” That is, a “hazardous substance” is defined as a chemical, or chemical compound, including breakdown products, identified by any state or federal agency or other governmental body or the World Health Organization as potentially having properties of eye and skin irritation, sensitization, acute or chronic toxicity, carcinogenicity, cytotoxicity, neurotoxicity, developmental or reproductive toxicity, or both, endocrine disruption or ecotoxicity.  Any chemical has the "potential" to be toxic at the wrong dose. Even substances universally regarded as safe can cause sensitization in a few hyper-allergic persons.

 

• Second, hazardous incidental ingredients—those without a technical or functional effect, which, for example, can be present in very small quantities from processing or the production of other products—cannot be protected as trade secrets.

 

• Third, if a product or its ingredients or incidental ingredients can be reverse engineered, it should not receive trade secret protection. Of course, it is impossible for manufacturers to know in advance what is capable of being reversed engineered for the purposes of disclosing ingredients.

Such disclosure of all chemical ingredients in products may lead to final product manufacturers being placed in the awkward situation of asking suppliers to divulge ingredient information, unique combinations of ingredients, and/or formulas that are patented, proprietary, or considered trade secrets. Many times these formulas are provided to final product manufacturers only under confidentiality agreements. The legislation, in those cases, would appear to require manufacturers to violate those confidentiality agreements by disclosing chemical ingredient information.

In addition, the bill requires that a manufacturer complete a complicated and unworkable formal process to have product information protected as a trade secret. This includes a showing of how secrecy leads to value, the ease of duplication if disclosure is made, how the chemical identity relates to how the chemical is made, how the manufacturer maintains secrecy, and how hard it is to reverse engineer the product. Most importantly, this includes disclosure of the basis for the manufacturer’s determination that its ingredients are not hazardous. That is, prove the negative. 

Finally, if the state Department of Toxic Substances Control (DTSC) determines that the product is not deserving of trade secret protection for any number of listed reasons, including request from the public, the government can affirmatively disclose the product information. In order to prevent disclosure, the manufacturer will have 30 days to file for an injunction. That is an unfair and unworkable time frame.

A coalition of business interests led by the California Chamber of Commerce is opposing the bill on the grounds it increases costs to consumers and will expose confidential business information.  It fears that the definition of product will be expanded "to include everything under the California sun."

The bill would also eliminate trade secret protection after six years unless the manufacturer renews its claim. There is no apparent purpose for such a sunset provision on a trade secret claim other than to burden and place additional expense on the manufacturer. Finally, the bill provides no protections against private rights of action, including actions that may arise under California consumer fraud laws.

We could go on, but isn't that enough reason to conclude the bill strikes the wrong balance?

 

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The Natural Resources Defense Council brought suit last week against the FDA for allegedly failing to take timely action in response to its petition asking the agency to ban the chemical bisphenol A. NRDC v. Sebelius, D.C. Cir., No. 10-1142 (filed 6/29/2010).

NRDC is one of a number of advocacy groups who allege that this important chemical, used to make polycarbonate plastics in water bottles and epoxy resins used to line cans containing food, causes harmful health effects, particularly to infants and children, including early puberty, reproductive abnormalities.

However, both the scientific process and the public interest are better served by allowing the FDA to complete its ongoing review of the science surrounding the safety profile of BPA -- at its own pace.  Just this January, the U.S. Department of Health and Human Services and the FDA made it clear that BPA has not been proven to harm children or adults.  EPA released its bisphenol A Action Plan in March 2010. Importantly, the agency clearly indicated that it does not intend to initiate regulatory action under TSCA at this time on the basis of human health concerns.

This observation is consistent with a draft assessment issued by FDA in 2008, and the scientific conclusions of many other government regulatory agencies around the world. In January 2010, the German Federal Institute for Risk Assessment (BfR, Bundesinstitut für Risikobewertung) wrote, “Following careful examination of all studies, in particular the studies in the low dose range of bisphenol A, BfR comes to the conclusion in its scientific assessment that the normal use of polycarbonate bottles does not lead to a health risk from bisphenol A for infants and small children. BfR is not alone in this assessment. The European Food Safety Authority (EFSA) and the U.S. Food and Drugs Administration (FDA) share this opinion. Japan, which has conducted its own studies on bisphenol A, does not see any need for a ban either.”
 

In January 2010, FDA Deputy Josh Sharfstein was quoted as noting the FDA does support the use of baby bottles with BPA because the benefits of sound infant nutrition currently outweigh the known risks from BPA. Nevertheless, and perhaps not surprisingly, the California Assembly passed legislation last week to ban the use of bisphenol A in children's food and drink containers beginning in 2012.  The bill passed by a vote of 43-31 vote. The Toxics-Free Babies and Toddlers Act (S.B. 797) moves to the state Senate for approval, since the Senate initially passed a different version early last month.

The bill provides that if the state Department of Toxic Substances Control begins to regulate the chemical through its “green chemistry’’ initiative, S.B. 797 would be repealed.  In the meantime, the law would would limit the level of BPA in baby bottles, toddlers' cups, and food and drinking containers.  Infant formula manufacturers would have until July, 2012, to stop using BPA in the coatings used to line their metal containers.

 

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The Judge overseeing the Welding Fume Products Liability MDL Litigation has issued a “Trial Template” to assist transferor courts in handling the 3,900 remaining cases in the future.  In re: Welding Fume Products Liability Litigation, MDL No. 1535 (N.D. Ohio).

The document outlines the proceedings that have occurred in this MDL since its 2003 inception,
and summarizes the court’s pretrial rulings applicable to every MDL case. (All of this MDL court's written Orders cited in the document are available through the MDL court’s site.)  The stated purpose of the document is to assist trial judges in transferor courts who may preside over the trial of an individual welding fume case, after the Judicial Panel on Multi-District Litigation remands the
case from the MDL court back to the transferor court.

(Another good source on this mass tort for the interested reader is Jowers v. Lincoln Elec. Co., 608 F.Supp.2d 724 (S.D. Miss. 2009), in which the court reviewed all of the parties’ evidence in the context of resolving defendants’ post-judgment motions, filed after the jury reached a rare plaintiff’s verdict in the fourth MDL bellwether trial.)

Key points: since the MDL was created in the U.S. District Court for the Northern District of Ohio in June 2003, more than 9,800 cases have been transferred from other courts, and 2,700 have been removed to or directly filed with the court. Voluntary dismissals, remands and other events have reduced the number of pending cases to approximately 3,900. The gravamen of the complaint in each of these cases is that manganese contained in the fumes given off by welding rods has caused the plaintiff to suffer neurological injury, and the defendant manufacturers of these welding rods failed to warn of this hazard. At trial, defendants typically interpose some or all of the following fact-based defenses: (1) the warning language defendants used was adequate; (2) the plaintiff did not prove he used a particular defendant’s welding rods; (3) the plaintiff did not prove he saw a particular defendant’s warnings; (4) the plaintiff did not prove his neurological condition was caused by exposure to welding fumes; (5) the plaintiff’s neurological condition is not manganese-induced "Parkinsonism," it is something else (e.g., psychogenic movement disorder); (6) the defendants are immune pursuant to their role as government contractors; (7) the defendants are not liable because the plaintiff’s employer was a learned intermediary; (8) the defendants are not liable because the plaintiff was a sophisticated user; (9) the plaintiff did not prove that a better warning would have made any difference; (10) the plaintiff is, to some degree, responsible for his own injuries under the theories of contributory negligence, comparative negligence, or assumption of the risk; and (11) punitive damages are not available because the plaintiff did not present clear and convincing evidence of gross negligence.

The MDL court presided over six bellwether trials and is now in the process of suggesting remand to transferor courts of cases that have become close to trial-ready, the judge said. The court has so far applied the laws of five states in MDL bellwether trials: Mississippi, Texas, South Carolina, California, and Iowa. The parties sometimes, but not always, have agreed on which state’s law applies. In cases of disagreement, the choice-of-law analysis a transferor court will have to apply is likely to be fact-specific.

The court has granted summary judgment to certain defendants (MetLife & Caterpillar) in all welding fume cases. Further, the Court entered a “Peripheral Defendant Dismissal Order,” dismissing without prejudice all defendants in every case except those against whom a given plaintiff is most likely to proceed at trial. Still remaining as defendants in virtually every case are five of the biggest welding rod manufacturers: (1) Lincoln Electric Company, (2) BOC Group (formerly known as Airco) (3) ESAB Group, (4) TDY Industries (formerly known as Teledyne Industries and Teledyne McKay), and (5) Hobart Brothers Company. Defendant-specific discovery in each case may lead to dismissal of some of these five defendants, and possibly to renaming of some previously-dismissed defendants, the court observed. 

Regarding discovery, the parties have engaged in huge amounts of generic discovery directed at
information potentially relevant to every case. This includes, for example, the defendants’ alleged historical knowledge of the hazards posed by welding fumes, the warnings defendants provided to welders over time, and the state of medical and scientific knowledge regarding neurotoxicity of manganese in welding fumes. For the most part, the parties have completed all general discovery. To prepare for trial in a specific welding fume case, the parties must engage in substantial case-specific discovery directed at information relevant to the individual plaintiff’s particular claims and circumstances. This discovery typically will address the plaintiff’s employment history, medical history, and welding experiences. The court observed that at least some of this plaintiff-specific discovery may not occur until after the MDL court has remanded the case to the transferor court. Accordingly, a transferor court may need to oversee some aspects of case-specific discovery.

As to plaintiffs, about ten years ago, the national plaintiffs’ bar engaged in a concerted effort to notify welders that, if they suffered from a movement disorder, their neurological injury might be caused by exposure to welding fumes. The MDL court then imposed several obligations on plaintiffs’ counsel to ensure they intend to actually try the cases they filed. These additional obligations include the filing of: (1) a “Notice of Diagnosis” of neurological injury, signed by a medical doctor; and (2) a “Certification of Intent to Try the Case,” to be submitted by plaintiff’s counsel following initial medical records discovery. These obligations have winnowed the plaintiffs’ cases substantially, so the MDL court believes that there is some likelihood that a case remanded to a transferor court will go to trial.

On the expert front, the parties sought to introduce at trial testimony from a plethora of experts in a number of fields, including neurology, neuro-pathology, neuro-psychology, neuro-radiology, epidemiology, bio-statistics, industrial hygiene, industrial engineering, chemistry, materials science, toxicology, warnings, corporate ethics, military specification and procurement, economics, government lobbying, and ancient corporate documents. Early in this MDL, the court held a multi-day Daubert hearing to determine the admissibility of opinions offered by these experts. Further, the court engaged in additional analyses of the admissibility of expert testimony prior to each MDL
bellwether trial.

Before each MDL bellwether trial, the parties filed numerous motions in limine addressing the admissibility of various pieces of evidence, ranging from critical documents to relatively short comments made by witnesses. The court reviews each of those rulings in this latest document.  Similarly, the court had ruled on a number of motions for summary judgment as a matter of state and federal law. These motions are also described in the document.  For example, to prevail on his product liability claims against a particular manufacturing defendant, a welding fume plaintiff must show he actually used that manufacturer’s products. Because many plaintiffs worked as welders for a variety of employers in different locations over many years, and because welding rods are somewhat fungible, the discovery of product identification evidence can be difficult, and the results less than clear, said the court. Whether a given defendant is entitled to judgment as a matter of law based on lack of product identification is a highly fact-specific question, and the answer as to certain defendants in certain cases may not become clear even until after trial.

Finally, the court provides a number of useful appendices and charts, including MDL Bellwether Trial Result Summary and MDL Bellwether Trial Witness Chart.

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Readers may recall that last month we posted about H.R. 5503, the “Securing Protections for the Injured from Limitations on Liability Act” (SPILL Act). This is one of many pending and promised bills addressing legal liability issues arising from the Gulf Coast oil spill, including amendments to the Death on the High Seas Act.

Specifically, H.R. 5503 would:

• Amend the Death on the High Seas Act to permit recovery of non-pecuniary damages (e.g., pain and suffering and loss of care, comfort, and companionship) by the decedent’s family, as well as standardizing the geographic threshold for its application, and permitting surviving family members to bring suit directly rather than through a personal representative.
• Amend the Jones Act to permit recovery of non-pecuniary damages by the families of seamen who are killed.
• Repeal the Limitation on Liability Act to the extent it limits the liability of vessel owners to the value of the vessel and its cargo.
• Amend bankruptcy rules to prevent corporations allegedly responsible for damages under the Oil Pollution Act from certain moves seeking to sever their assets from the legal liabilities.

The bill was supposed to be in response to the Gulf Oil Spill. However, we cautioned that some of  its provisions were not limited to the subject matter of oil spills. For example, Section 5 of the bill as introduced, proposed to amend the Class Action Fairness Act to exclude from its reach any action brought by a State or subdivision of a State on behalf of its citizens. Such a provision could have significant effect on CAFA, far beyond the oil spill litigation. For example, it might impact cases like State ex rel. McGraw v. Comcast Corp., 2010 WL 1257639 (E.D. Pa. Mar. 31, 2010).

The version passed by the House apparently does not contain this provision.  It was passed on motion to suspend the rules and pass the bill, as amended, and agreed to by voice vote.  Republicans and industry groups had expressed some concerns, and since many of the provision purport to be retroactive, wondered what the rush was.  Supporters argued that some of the prevailing laws were written in the mid-19th century to protect American merchant ship owners, and that the liability system needs to be updated.

As amended, Section 2 amends the Death on the High Seas Act (chapter 303 of title 46, United States Code), Section 3 alters recoveries under the Jones Act; Section 4 would repeal the Limitation of  Liability Act and the Oil Pollution Act; and Section 5 would provide new bankruptcy protection for tort claims arising from oil incidents.

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Last week,  U.S. House Judiciary Committee Chairman John Conyers, Jr. (D-Mich.) and Congressman Charlie Melancon (D-LA) introduced H.R. 5503, the “Securing Protections for the Injured from Limitations on Liability Act” (SPILL Act).  This is one of many pending and promised bills addressing legal liability issues arising from the Gulf Coast oil spill, including amendments to the Death on the High Seas Act.

Specifically, H.R. 5503 would:

• Amend the Death on the High Seas Act to permit recovery of non-pecuniary damages (e.g., pain and suffering and loss of care, comfort, and companionship) by the decedent’s family, as well as standardizing the geographic threshold for its application, and permitting surviving family members to bring suit directly rather than through a personal representative.

• Amend the Jones Act to permit recovery of non-pecuniary damages by the families of seamen who are killed.

• Repeal the Limitation on Liability Act to the extent it limits the liability of vessel owners to the value of the vessel and its cargo.

• Amend bankruptcy rules to prevent corporations allegedly responsible for damages under the Oil Pollution Act from certain moves seeking to sever their assets from the legal liabilities.

The bill is supposed to be in response to the Gulf Oil Spill. However, many of its provisions are not limited to the subject matter of oil spills.  For example, Section 5 proposes to amend the Class Action Fairness Act  to exclude from its reach any action brought by a State or subdivision of a State on behalf of its citizens.  Such a provision could have significant effect on CAFA, far beyond the oil spill litigation. For example, it might impact cases like State ex rel. McGraw v. Comcast Corp., 2010 WL 1257639 (E.D. Pa. Mar. 31, 2010). In that case, the state of West Virginia, in its capacity as parens patriae, filed an action in state court alleging that a cable company's requirements concerning cable boxes constituted impermissible tying behavior, in violation of state antitrust and consumer protection laws. On removal, the federal court held that the action was a “class action” under the Class Action Fairness Act, under which the definition of a class action must be “interpreted liberally.”

The bill has been referred to the following committees: House Judiciary, Subcommittee on House Transportation and Infrastructure, Subcommittee on House Transportation and Infrastructure, Subcommittee on Coast Guard and Maritime Transportation.

Earlier this month, the House Subcommittee on Oversight and Investigations held a field hearing In Louisiana on the local impact of the Gulf oil spill.The House Subcommittee heard testimony from experts on the environment and wildlife, some of whom who warned that the full effects of the spill will not be known until the flow of oil is stopped.  But the most emotional testimony came from two widows, whose husbands died when the Deepwater Horizon Rig exploded in April. The widows urged Congress to reform the Death on the High Seas Act, but also noted that they fully support offshore drilling as essential to our nation's economy.

 

UPDATE: the House Judiciary Committee approved H.R. 5503, Securing Protections for the Injured from Limitations on Liability Act (SPILL Act), by a roll call vote of 16-11, with two Republicans, Reps. Lungren (R-Calif.) and Rooney (R-Fla.), joining the rest of the Democratic committee members in voting in favor.

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In a case that may impact some of the litigation rising from the Gulf Oil Spill, the Florida Supreme Court last week ruled in favor of a group of commercial fishermen who alleged damages arising from pollution in the Tamp Bay. See Howard Curd, et al. v. Mosaic Fertilizer LLC, (No. SC08-1920 Fla. 6/17/2010). The issue on appeal -- which the court took as a certified issue of great public importance -- was whether Florida law permits commercial fishermen to recover for economic losses proximately caused by the negligent release of pollutants, despite the fact that the fishermen do not own any property damaged by the pollution.

The defendant owned/operated a phosphogypsum storage area near Archie Creek in Hillsborough County. The storage area included a pond enclosed by dikes, containing waste water from a phosphate plant.  The dike gave way and pollutants were allegedly spilled into Tampa Bay.
The fishermen claimed that the spilled pollutants resulted in a loss of underwater plant life, fish, bait fish, crabs, and other marine life. They did not claim an ownership in the damaged marine and plant life, but claimed that it resulted in damage to the reputation of the fishery products the fishermen were able to catch and sought to sell.

The lower court concluded that the state statute on water pollution did not permit a claim by these fishermen for monetary losses when they did not own any real or personal property damaged by the pollution. After initially permitting the fishermen to proceed on their claims of negligence and strict liability, the lower court ultimately ruled that these claims were not authorized under the economic loss rule. The court reasoned that an action in common law either through strict liability or negligence was not permitted because the fishermen did not sustain bodily injury or property damage. The strict liability and negligence claims sought purely economic damages unrelated to any damage to the fishermen's property. Accordingly, the court further reasoned that Mosaic did not owe the fishermen an independent duty of care to protect their purely economic interests. 

The state supreme court disagreed.  The court pointed to a number of factors on the statutory claim:  it expressly protected public and private interests; it is to be liberally construed to effect the purposes set forth in the state statute and the Federal Water Pollution Control Act.  Moreover, the Florida  Legislature found and declared that escape of pollutants “poses threats of great danger and damage . . . to citizens of the state, and to other interests deriving livelihood from the state.”   Also, under the definition of statutory damages cited above, one can recover for damages to real or personal property and for damages to natural resources, including all living things. Finally, not owning property affected was not a listed defense to the cause of action in the act.

The lower court found that the economic loss rule barred the common law claims, as the fishermen's negligence and strict liability claims sought purely economic damages unrelated to any damage to the fishermen's property. Second, Mosaic did not owe an independent duty of care to protect the fishermen's expectation of profits. The supreme court found instead that neither the contractual nor products liability economic loss rule was applicable to this situation. The parties to this action were not in contractual privity. Moreover, the defendant in this case was not  a manufacturer or distributor of a defective product that has caused damage to itself.  Rather, plaintiffs brought traditional negligence and strict liability claims against a defendant who had allegedly polluted Tampa Bay and allegedly caused them injury.

Turning to the issue whether Mosaic owed an independent duty of care to protect the fishermen's purely economic interests—that is, their expectations of profits from fishing for healthy fish, the court found Mosaic did owe a duty of care to the fishermen, a duty that was not shared by the public as a whole.  The court admitted that as a general principle of common law negligence, some courts have not permitted recovery for purely economic losses when the plaintiff has sustained no bodily injury or property damage. See Union Oil Co. v. Oppen, 501 F.2d 558, 563 (9th Cir. 1974) (noting “the widely recognized principle that no cause of action lies against a defendant whose negligence prevents the plaintiff from obtaining a prospective pecuniary advantage”). The reasoning behind this general rule is that if courts allowed compensation for all losses of economic advantages caused by a defendant's negligence, a defendant would be subject to claims based upon remote and speculative injuries that it could not foresee. Such courts have concluded that the negligent defendant owes no duty to plaintiffs for such losses.

The Florida court concluded that the defendant here did owe a duty of care to these commercial fishermen, and that the commercial fishermen thus had a cause of action sounding in negligence. Under Florida law, the question of whether a duty is owed is linked to the concept of foreseeability. In the present case, the duty owed by Mosaic arose out of the nature of Mosaic's business and the special interest of the commercial fisherman in the use of the public waters. The court concluded that Mosaic's activities created an appreciable zone of risk within which Mosaic was obligated to protect those who were exposed to harm. Mosaic's business involved the storage of pollutants and hazardous contaminants. It was foreseeable, said the court, that were these materials released into the public waters, they would cause damage to marine and plant life as well as to human activity in the water.

Further, the commercial fishermen had a special interest within that zone of risk, an interest not shared by the general community, found the state supreme court.  The fishermen were licensed to conduct commercial activities in the waters of Tampa Bay, and were dependent on those waters to earn their livelihood. Mosaic's activities placed the fishermen's peculiar interests directly within the zone of risk created by the presence of its facility. As a result, Mosaic was obligated to exercise prudent foresight and take sufficient precautions to protect that interest.

As pointed out in the dissent, the majority opinion decided the case for a more narrow class than those bringing the suit -- and more narrowly than the claims they alleged. Although Curd's proposed class consisted of “all fishermen and those persons engaged in the commercial catch and sale of fish,”  the majority's decision did not extend to distributors, seafood restaurants, fisheries, fish brokers, or the like whose incomes may also have been affected by the alleged pollution. Additionally, the majority only addressed economic harm that allegedly resulted from the depletion of marine life and the resulting inability to harvest the commercial fishermen's usual yield—not from harm to reputation as alleged in the complaint. The fishermen presumably must still prove all of the elements of their causes of action, including damages.
 

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The Environmental Protection Agency has released a draft toxicological review of formaldehyde, entitled "Toxicological Review of Formaldehyde Inhalation Assessment: In Support of Summary Information on the Integrated Risk Information System (IRIS).''  (EPA's IRIS is a human health assessment program that evaluates quantitative and qualitative risk information on effects that may result from exposure to chemical substances found in the environment. )

EPA announced a 90-day public comment period and a public listening session for the external review draft human health assessment.  The draft assessment was prepared by the National Center for Environmental Assessment (NCEA) within the EPA Office of Research and Development (ORD). EPA said it was releasing this draft assessment for the purpose of pre-dissemination peer review.  Also, a committee of the National Research Council, acting under the auspices of National Academy of Sciences (NAS), will conduct an independent scientific peer review of the EPA draft human health assessment of formaldehyde. The peer review committee will hold meetings, some of which may involve public sessions. Public sessions will be announced before each meeting on the National Academies Web site.  The public comment period and NAS scientific peer review are separate processes that are supposed to provide opportunities for all interested parties to comment on the assessment.

Formaldehyde is present in a wide variety of products including some plywood adhesives, abrasive materials, insulation, insecticides and embalming fluids. The major sources of anthropogenic emissions of formaldehyde are motor vehicle exhaust, power plants, manufacturing plants that produce or use formaldehyde or substances that contain it (i.e. glues), petroleum refineries, coking operations, incinerating, wood burning, and tobacco smoke, says the EPA.  It is used in industry to manufacture building materials and numerous household products and consumer products, including some soaps, shampoos, and shaving cream. 

Of course, alleged exposure to formaldehyde has been involved in numerous toxic tort suits as well as consumer fraud actions.

The draft assessment found that formaldehyde could be more likely to cause cancer than in previous EPA calculations. In the draft, EPA now estimates there could be up to one case of cancer for every 1,000 people breathing formaldehyde at concentrations of 20 parts per billion over their lifetime.  The draft assessment also provides for the first time an agency estimate of a reference concentration (RfC). Lifelong inhalation of formaldehyde at concentrations up to that RfC would not be expected to cause breathing, immune, reproductive, and other non-cancer health effects.

At Section 4.5.4, the report concludes that human epidemiological evidence is sufficient to conclude there is a causal association between formaldehyde exposure and nasopharyngeal cancer, nasal and paranasal cancer, all leukemias, myeloid leukemia and lymphohematopoietic cancers as a group. But, for example, it is questionable whether there really is a demonstrable link between formaldehyde and leukemia.  And the evidence does not appear to support a causal link between formaldehyde and  upper-respiratory tract cancers. See the critical comments of other federal agencies.

Any regulatory decision on this important chemical based on incomplete information could cause significant harm to the economy, as many products critical to the home and commercial building, automotive and aerospace industries, as well as defense-related applications and vaccines used worldwide to prevent polio, cholera, diphtheria, and other major diseases, all use it.  All living things — including people — produce and process formaldehyde. It occurs naturally in the air we breathe and does not accumulate in the environment or in plants, animals or people.

Rep. Henry A. Waxman (D-Calif.) has stated that the draft report is another reason to reform the Toxic Substances Control Act.  He plans to introduce such a bill this Summer. Also, legislation that would amend TSCA to set formaldehyde emissions limits for plywood and other composite wood products was reported out last month by the House Energy and Commerce Committee.  See H.R. 4805, The Formaldehyde Standards for Composite Wood Products Act.

Update: and an alert reader points out that the Senate just this week passed its own version, S.1660, the Formaldehyde Standards for Composite Wood Products Act.  The Senate bill would make the formaldehyde emission standard contained in the California Code of Regulations (relating to an airborne toxic control measure to reduce formaldehyde emissions from composite wood products, as in effect on July 28, 2009) applicable to certain hardwood plywood, medium-density fiberboard, and particleboard sold, supplied, offered for sale, or manufactured in the United States, with certain exemptions, including for composite wood products used inside new vehicles, rail cars, boats, aerospace craft, or aircraft.

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The First Circuit affirmed last week the lower court's dismissal of a putative consumer fraud class action involving a re-called heartworm medication for dogs. Rule v. Ford Dodge Animal Health Inc., 2010 WL 2179794 (1st Cir. 6/2/10).

Plaintiff, Rule, purchased two doses of ProHeart 6, a medicine for preventing heartworm in dogs, and had them administered to her dog Luke. She later filed a putative class action against Wyeth, alleging that defendant had sold ProHeart 6 without disclosing safety concerns revealed in initial testing and in subsequent use.  She alleged these concerns ultimately led Wyeth to recall the product at the FDA's request. According to plaintiff, adverse reactions were suffered by dogs after receiving ProHeart 6 during trials and in general use after the product was released. Importantly, the class representative conceded that Luke had not suffered any harm from the drug, and that Luke had not developed heartworm while using the drug.

Plaintiff's first cause of action was based on breach of the implied warranty of merchantability and the other based on the state consumer fraud statute, Mass. Gen. Laws ch. 93A. For damages on these two counts, Rule asserted that she and others similarly situated were entitled to the difference between the price they actually paid for ProHeart 6 and what it would have been worth had safety risks been adequately disclosed; for the chapter 93A count, she sought statutory damages if greater than actual damages and also trebling of damages. 

On the warranty count, the alleged unmerchantability (unfitness for ordinary use) of ProHeart 6 lay in its potential for causing harm to a dog. Rule conceded, however, that neither of the two doses injured Luke. So, while the sale to Rule may have been of an "unfit" drug, its unfitness did not give rise to any injury to Rule against which the warranty was designed to guard. Nor did she suggest that Luke became more susceptible to injury, as might be the case where one bought and installed a defective car tire that has not yet run its life. Recovery generally is not available under the warranty of merchantability where the defect that made the product unfit caused no injury to the claimant, the threat is gone, and nothing now possessed by the claimant has been lessened in value.

On the consumer fraud count, the act provides a cause of action for a plaintiff who has been injured by unfair or deceptive acts or practices. In Rule's view, she purchased Proheart 6 because of a deception (failure to disclose the risk), the product was “in reality” worth less than she paid for it (because of that undisclosed risk), and so she suffered damage measured by the difference between what she paid and what she would have paid if the risk had been disclosed. One problem with plaintiff's scenario was that she also alleged that had the risks been known, ProHeart 6 could not be sold at all, given FDA requirements.

But even assuming otherwise, Rule's suit was brought after her purchases and use of the drug, and she admitted that she got both the protection and convenience she sought and that the risk did not manifest itself in injury to her or her dog. Nor was she still holding a product that was worth less than she paid for it; she used the product up entirely and in fact suffered no economic injury at all. Indeed, her theory would not be adopted by deceived buyers whose dogs were actually injured or killed; they could seek not some modest reduction in price but the full cost of added veterinary bills and, if the dog died, its value.

So to the extent chapter 93A injury requires that a plaintiff who seeks to recover show “real” economic damages, Rule did not qualify. If, instead, a different notion of injury had sufficed - such as injury as a violation of some abstract “right” like the right not to be subject to a deceptive act that happened to cause no economic harm - then she would arguably have had a claim under chapter 93A and perhaps could obtain statutory damages.  The First Circuit observed some "tension" in the language used as between the earlier and the later state SJC decisions on the statute and especially where deception and risk are involved. However, said the court of appeals, the most recent SJC cases on point appear to have reaffirmed the notion that injury under chapter 93A means economic injury in the traditional sense.

Finally, the First Circuit addressed plaintiffs' typical policy-based argument that deceptive conduct needs to be deterred through a class action. While the alleged conduct such as that attributed to defendant needs to be deterred, that need not necessarily come from those who bought the product but were not injured.  It could be deterred by those with actual injury.
 

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The Third Circuit has affirmed the dismissal of two putative class actions that sought medical monitoring for workers and neighbors of factories using beryllium. Sheridan, et al.  v. NGK Metals Corp., et al., 2010 WL 2246392 (3d Cir. June 7, 2010). 

Readers may recall that previously we posted on the district court's dismissal of the claims against one of the defendants, an engineering firm that, according to the plaintiffs’ Amended Complaint, was involved with testing, sampling, analyzing, and monitoring the air quality and levels of beryllium at one plant involved in the cases. The Third Circuit affirmed.  Boiled down to its core, plaintiffs’ Amended Complaint contended that the engineering firm breached its duty of reasonable care by failing to warn members of the community surrounding one of the plants at issue about the alleged beryllium emissions from the facility. But there was no legal duty to warn.  In order for the engineers to have negligently failed to warn plaintiffs of harmful beryllium exposures, they must have undertaken the responsibility of making that warning. Plaintiffs never alleged that the firm negligently performed the tasks it actually undertook—that is, testing, analyzing, and monitoring the levels of beryllium, and reporting those tests to the owner and operator of the facility. 

Also of note for readers is the remainder of the court's analysis regarding other defendants, which focused on one of the elements of medical monitoring.

Some background.  Plaintiffs in each case filed a putative class action lawsuit against multiple defendants, alleging negligence in connection with beryllium exposure, and seeking a medical monitoring trust fund based on their alleged increased risk of developing chronic beryllium disease int he future. In the first action, (the “Anthony action”), the District Court granted defendants’ joint motion for summary judgment. In the second (the “Zimmerman action”), the District Court addressed three separate legal issues— medical monitoring under Pennsylvania law, claim preclusion of the claims of one named plaintiff, Sheridan, and third-party liability—and issued final orders in favor of defendants. Although the cases presented similar legal issues, they arose out of different locations and distinct facts. However, plaintiffs’ lawyers, many of the expert witnesses, and one defendant, were the same in each case. The Third Circuit did not consolidate the two separate appeals, but resolved them in one opinion.

Inhaling beryllium particles can lead to scarring of the lungs, a condition known as chronic beryllium disease.  CBD occurs when the immune system mounts an attack against beryllium particles that have entered the body. The lung sacs become inflamed and fill with large numbers of white blood cells that accumulate wherever the beryllium particles are found. The cells form balls around the particles called granulomas. Eventually, the lungs become scarred and lose their ability to transfer oxygen to the blood stream.

The dose-response picture is a bit unusual. Mere exposure itself appears to be insufficient because only persons who have a particular genetic “marker”—the Human Leukocyte Antigen (HLA)-DPB1 allele—can potentially recognize beryllium in the lungs as an antigen. This reaction is called beryllium sensitization (“BeS”). The parties did not dispute that BeS is a necessary precursor to CBD. BeS by itself causes no abnormal lung function and requires no treatment (i.e., it is asymptomatic).  The experts debated how many people have the marker with estimates ranging from below 10% to 40% of the population. The most common test for sensitization is the beryllium lymphocyte proliferation test (“BeLPT”), which is not a test for the genetic marker, but a reasonably accurate test for sensitization according to the experts.

Readers know that one of the typical elements of a medical monitoring claim is proof of a significantly increased risk (of contracting the latent disease for which plaintiff seeks medical monitoring). Plaintiffs' expert testimony was that all individuals exposed to beryllium at above background levels are at a significantly increased risk and require medical monitoring. They  declared that there is a direct relationship between the level of exposure and risk, and that CBD is not qualitatively different from any other environmental exposure disease.  Defendants' expert opined that given class rep Anthony’s negative result in the test to show whether he had become sensitized, and the fact that only a small percentage of the population can become sensitized, Anthony was not at a significantly increased risk of developing CBD.

In the other class action, the parties stipulated that class rep Zimmerman was not beryllium sensitized. Plaintiff experts argued, however, that anyone who has lived in the area surrounding the plant in question was at a significantly increased risk given the levels of beryllium in the
ambient air and documented cases of CBD in the community. They made a quantitative risk assessment based on collected exposure data, concluding that the risk of contracting CBD to the members of the proposed class represented by Zimmerman was 3 per 10,000, and for those
individuals who have lived near the plant for at least ten years, the risk allegedly increased to 1 per 500.

The Third Circuit noted that the intermediate appellate court in Pennsylvania had addressed analogous medical monitoring claims in Pohl v. NGK Metals Corp., 936 A.2d 43 (Pa. Super. Ct. 2007). The Pennsylvania Superior Court concluded there that the record provided no support for plaintiffs’ contention that they were sensitized to beryllium and thus that they faced a significantly increased risk of contracting CBD. Plaintiffs in federal court contended that Pohl was neither controlling nor persuasive, because it was a fact-specific decision in which the state court dismissed the three plaintiffs’ claims based on their individual failure of proof.

The court of appeals, however, concluded that the state court drew a line along the exposure-to-disease continuum -- at sensitization. The Third Circuit held that unlike its role in interpreting federal law, it may not "act like a judicial pioneer" in a diversity case. Contrary to both Anthony’s and Zimmerman’s contentions, Pohl was not based only on a simple lack of proof; it was based on plaintiffs’ failure to meet the requisite threshold for establishing significantly increased risk due to (1) the undisputed facts about beryllium exposure, BeS, and CBD, and (2) plaintiffs’ inability to demonstrate a significant increase in risk of disease before sensitization. Although the disparate data on how many people have the marker shows the gaping holes in the current state of scientific research, as well as the substantial factual disagreements between scientists, it was not material to this appeal. The parties stipulated that Anthony had not developed BeS, and there was no proof that he has the genetic marker associated with CBD. This background data did not prove his individual significantly increased risk.

As to the Zimmerman class (all persons who resided within a one-mile radius of the Reading Plant for at least six months during the time period between 1950 and 2000), the court noted that plaintiffs tried to make a different showing, including by presenting data on specific exposure levels around the Reading Plant and the number of documented cases of CBD in the community there. From Zimmerman’s perspective, exposure to beryllium is analogous to exposure to other toxins, such as asbestos and PCBs. Defendants contended CBD’s immunological nature distinguishes beryllium from other toxins, which do not invoke an allergic response in only a subset of susceptible persons and instead have a more linear exposure-to-disease relationship.

The state of the art is that only a small subset of an exposed population (those who carry the genetic marker) is at risk of developing CBD; the relationship between beryllium exposure and CBD is relatively non-linear, making generalized risk assessments inappropriate. Thus, there was a failure of proof on the risk element, given the current state of scientific knowledge on the
relationship between beryllium exposure and disease. Plaintiff failed to present sufficient evidence that as a proximate result of the exposure, he had a significantly increased risk of contracting
CBD.

The failure of the class reps to show they could meet a necessary element of the claim meant that the class actions could not proceed. (Sheridan's claim was barred.)

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The Consumer Product Safety Commission last week announced the results of testing performed by the Lawrence Berkeley National Laboratory on allegedly defective drywall samples.  Among the findings, most of the drywall that has allegedly caused personal injury and corroded electrical components in various homes throughout the U.S. was indeed manufactured in China;  specifically,  the most reactive sulfur-emitting drywall samples were all produced in China, according to the CPSC.  The worst-testing samples of the Chinese drywall showed emission rates of hydrogen sulfide 100 times greater than non-Chinese drywall samples.

CPSC released the names of the 10 worst-performing samples, including those of Knauf Plasterboard (Tianjin) Co. Ltd. for drywall manufactured in 2005, Taian Taishan Plasterboard Co. Ltd. for drywall manufactured in 2006, Shandong Taihe Dongxin Co. for drywall manufactured in 2005, Beijing New Building Materials for drywall manufactured in 2009.  Drywall samples manufactured in the United States in the same period contained low or no detectable emissions of hydrogen sulfide, according to the agency. 

At the U.S.-China Strategic and Economic Dialogue meetings in Beijing May 24-25, U.S. officials reportedly pressed the Chinese government to facilitate a meeting between CPSC and the Chinese drywall companies whose products were used in U.S. homes, and which exhibit the emissions identified during the testing procedures. The Strategic and Economic Dialogue represents the highest-level bilateral forum to discuss a broad range of issues between the two nations.

Federal cases concerning the drywall products are coordinated in multidistrict litigation pending in the U.S. District Court for the Eastern District of Louisiana. More than 7,000 plaintiffs have claimed that Chinese-made drywall in their homes emits sulfide gases that corrode electrical wiring and/or cause personal injury such as nasal damage and other respiratory problems.  In the first trial, the court ordered Taishan Gypsum to pay $2.6 million to seven plaintiffs last April. In the second trial, the court ordered Knauf Plasterboard to pay a plaintiff family $164,000.  In re: Chinese-Manufactured Drywall Products Liability Litigation, MDL No. 2047 (E.D. La.).

Cases are also pending in state court, and a state trial court in Miami recently certified a class in this litigation. Harrell v. South Kendall Construction Corp. et al., No. 09-008401 (11th Judicial Circuit, Fla.). Following a hearing last Thursday, Judge Farina granted class certification, the first Chinese drywall case to be certified. The class consists of approximately 150 claimants who were purchasers of homes in three subdivisions of the Keys Gate community there. The class alleged that those homes were built using Chinese drywall. Defendants are home builder Kendall Construction Corp., Palm Isles Holdings LLC, broker Keys Gates Realty Inc, and supplier Banner Supply Co.

The court found that a predominating common issue in each class member's case is whether the drywall installed in his or her house was defective. The trial court found that the alleged defect, the potential to emit sulfur gases that can cause damage, is inherent in the physical characteristics of the product and thus has a uniform nature. With one supplier and one builder allegedly involved, the court distinguished the case from other product defect cases in which individual issues are typically found to predominate.

The opinion noted that differences among proof of damages has typically not defeated class certification. The court stressed that if individual class member homeowners were to file their own separate actions, the court would be confronted with a multiplicity of lawsuits that would unnecessarily burden the court system and create the risk of inconsistent rulings and contradictory judgments.

While the court was clearly influenced by the belief that the issues surrounding the allegedly defective product were "unaffected by outside variables," like the way the product was used, its analysis of predominance is quite questionable.  For example, it concluded that a common issue was whether the defective drywall damaged the homes of the putative class members, and thus that the issue of injury (whether the drywall damaged all the homes) could be proved with class-wide evidence.  The fact is that enough of the drywall was imported to damage more than 50,000 homes; yet only a small percentage of that has been observed. Thus, it may be that any number of factors may be impacting the damage drywall is or is not causing in a particular house. Moreover, it is far too simplistic to talk about the injury or "damage" being caused, when there are hotly debated issues about whether there is injury to, or the need for remediation of, non-problem drywall, insulation, flex duct, molding, encapsulated wiring, counter tops, and a whole host of house components. Similar issues will relate to the causation of corrosion of a home’s electrical wiring or AC system.  

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More than 100 federal and state court actions have been filed against BP PLC, Transocean Ltd., and other companies in connection with the Deepwater Horizon drilling rig accident in the Gulf of Mexico.  (The API has a Q&A on the accident, and the Unified Command on the incident offers updates.)  Like many mass accident scenarios, the spill has generated a variety of kinds of actions. The claims so far fall into several main categories, including personal injury/wrongful death, maritime torts, property damage/lost profits, shareholder claims, and environmental law actions.

The wrongful death actions arise from the 11 workers missing and presumed dead in the accident.  These cases were filed in federal and state courts in Louisiana and Texas.  Gulf-front property owners, fishermen, shrimpers, harvesters, seafood processors, and restaurants in Louisiana, Alabama, Mississippi and Florida are among the entities suing over alleged harm to their businesses and their economic livelihoods. Many of these suits are class actions with overlapping class definitions.  The plaintiffs typically allege that defendants knew of the dangers associated with deepwater drilling and failed to take appropriate safety measures to prevent damage to marine or coastal environments, where they work and earn their income.

These claims potentially implicate caps on damages under the Limitation of Liability Act, and the Oil Pollution Act, which currently caps certain oil spill liability at approximately $75 million.  Plaintiffs have asserted that there are various exemptions from this reach of the Oil Pollution Act, for gross negligence and certain cleanup costs.  Also, the Obama administration and Democrats in Congress have advocated raising the caps retroactively. Bills S. 3305  (the so-called Big Oil Bailout Prevention Liability Act of 2010) and H.R. 5214 would raise the liability for economic damages to $10 billion per spill from the current $75 million. In a Senate hearing, Interior Secretary Ken Salazar warned that raising the trust fund's liability cap to $10 billion would prevent smaller and mid-sized energy companies from operating offshore. Perhaps most importantly, there is some case law suggesting that the Oil Pollution Act will not preempt state common law tort liability.

The administration is also proposing a tax increase, to support the Oil Spill Liability Trust Fund, of a further 1 cent per barrel on petroleum. It is interesting that the administration has been criticized for the slowness of some of its responses to the spill, but is very quick to propose tax hikes, without an opportunity for all stakeholders to be heard and without careful consideration of the availability of the fund for future incidents. A White House summary of its proposals for legislation on oil spill response is available.

Some plaintiffs have proposed that the federal cases be coordinated in an MDL proceeding in the Eastern District of Louisiana.  In Re Oil Spill by the Oil Rig Deepwater Horizon in the Gulf of Mexico on April 20, 2010, MDL No. 2179 (filed 4/30/10). Certain defendants have suggested instead that the Southern District of Texas host the MDL. A large group of plaintiffs' attorneys had met in New Orleans early in the month to plot out litigation strategy.  Interestingly, the Mississippi Bar issued a statement advising potentially affected parties of the risk of improper solicitation by plaintiff attorneys.It will be fascinating to see if the defendants can remain similarly coordinated and avoid unnecessary finger-pointing.  The testimony of various executives for BP Plc, Transocean Ltd., and Halliburton in front of the Senate Energy and Natural Resources Committee and the Senate Environment and Public Works Committee that pointed out the responsibilities of the other companies, raises this issue. 

Another type of pending action is by various shareholders alleging securities fraud in a class action that asserts that defendants made false and misleading statements about their safety procedures. Allegedly as a result of the statements and the company's supposed failure to disclose prior safety issues, the stock prices had been inflated, tumbling after the accident.  Several shareholder derivative lawsuits were also filed against certain officers and directors of the defendants, claiming that they breached their fiduciary duties by supposedly ignoring critical safety issues. The suits also allege that defendants lobbied governmental authorities to reduce the extent of safety  regulation of the companies' gulf operations. (one would think that was protected speech)

Some litigation has named Interior Secretary Salazar and the U.S. Department of the Interior for their oversight of off-shore drilling operations. These case point to the rules regulating the oil companies' blowout and worst-case oil spill preparations.  Some have gone so far as to seek a halt to BP's operations at other oil drilling platforms.  Still others have focused on the oil companies' environmental impact statement posture as in violation of  the National Environmental Policy Act, and their seismic surveys and drilling operations as in violation of the Marine Mammal Protection Act and the Endangered Species Act.

Democratic Senators are pressuring the Justice Department to to open a criminal probe into the accident, and BP's statements to the federal government regarding its ability to respond to oil spills. Earlier this month, Florida Gov. Crist appointed two former Florida state attorneys general to head a newly formed legal team that will represent the state on issues related to the spill.

 

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Sen. Dianne Feinstein (D-Calif.) announced last week that she would seek to ban the chemical bisphenol-A in food and drink containers as part of an amendment to the proposed Food Safety Modernization Act (S.510). That move has the double distinction of lacking in scientific merit and threatening to undermine the bipartisan support for the good parts of the pending bill.  The Grocery Manufacturers of America and the Chamber of Commerce had expressed support for the food safety bill, but may oppose it if the bill contains language banning the chemical. The food safety bill is expected to come up after Congress returns from its Memorial Day break.

The Senator's ill-supported approach by-passes the safety review that belongs with the FDA, and is ongoing, with a re-review assessment due in 2011. NIH has also launched a study on the safety of low level exposure to BPA.  World-wide regulatory agencies who have reviewed BPA have thus far concluded that BPA is safe for use in canned products.  The European Food Safety Authority has announced a delay in delivering its own latest BPA report, needing more time to review the body of research on the chemical.

Clearly, an abrupt and unnecessary ban on packaging containing BPA would affect consumer ability to find nutritious, valuable, and shelf stable foods and beverages.  The proposed ban runs counter to the fact that BPA has been used for over 30 years to improve the safety and quality of food and beverages, including by providing protective coating for cans. The overwhelming scientific evidence points to the conclusion that at current human exposure levels, BPA is not toxic.  What is in fact occurring is that anti-chemical activists are simply manipulating consumers’ fears, and opportunistic politicians are jumping in.

Even though there is no persuasive scientific evidence that BPA causes the type of harm the politicians speculate about, litigation is well underway in both the Western District of Missouri (MDL 1967) and the Western District of Kentucky (MDL 2137). The former involves class action suits against manufacturers of baby bottles and sippy cups. The claims include alleged violation of state consumer protection acts, fraud, breach of warranty, unjust enrichment, strict product liability, and negligence. MDL 2137, on the other hand, involves suits against an aluminum bottle manufacturer claiming that the manufacturer marketed its product as an alternative to BPA-containing plastic even though its metal bottles were allegedly lined with an epoxy resin containing BPA.  

 

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Readers may recall my post about the Fifth Circuit granting the petition for rehearing en banc in Comer v. Murphy Oil.  The case involves a lawsuit by property owners against some three dozen oil, coal, and chemical companies, alleging that the defendants' activities contributed to climate change and magnified the effects of Hurricane Katrina, and thus exacerbated the damage from the storm. The trial court dismissed the suit on political question and standing grounds.  On appeal, a panel of the 5th Circuit reversed last Fall, finding that the plaintiffs did have standing and that the political question doctrine did not apply.

The defendants filed a petition for rehearing en banc, which was granted, and set the case for oral argument next week.  But, the clerk recently sent a letter noting the cancellation of en banc oral arguments.  Apparently, since the en banc court was constituted, new circumstances have arisen that make it necessary for another judge to recuse, leaving only eight members of the court able to participate in the case. Consequently, said the clerk, the en banc court has lost its quorum. Seven members of the court had previously recused themselves from the case.

Several defendants have filed a motion arguing for a different reading of the rule regarding a quorum, and/or raising the argument that the district court's opinion ought to remain the controlling law of the case, rather than the panel's decision which was vacated by the en banc decision. The court has responded by asking for supplemental briefing on these issues. Specifically, the order invited the parties to address the matter “as they think appropriate” but specifically directed them to analyze the interplay between the following rules and statute in resolving the disposition of the appeal: Fed. R. App. P. 35(a), 28 U.S.C. §46 (c) and (d), Fed. R. App. P. 41 (a) and (d) (1), 5th Cir. Local Rule 41.3, and Fed. R. App. P. 2. The court also instructed the parties that they may consider the rulings of Chrysler Corp. v. United States, 314 U.S. 583 (1941) and North American Co. v. Securities & Exchange Comm’n, 320 U.S. 708 (1943) and the Rule of Necessity.

Presumably, three outcomes are possible:the court decides it actually does have a quorum and thus oral argument is rescheduled; the panel decision is reinstated by default (with an ensuing cert petition to the Supreme Court); or, the district court is affirmed without opinion.

Many observers had predicted that the en banc decision by the 5th Circuit would create a circuit split  with the 2d Circuit decision in Connecticut v. American Electric Power. There, a two-judge panel reversed the lower court dismissing the case on political question grounds, and finding the plaintiffs had standing to assert nuisance claims (with a similar attenuated causation theory).  This presumably would have paved the way for Supreme Court cert review.  Of course, Justice Alito has recused himself in cases involving ExxonMobil due to his ownership of its stock, and  Justice Breyer has recused himself from cases involving BP.  Perhaps Justice Sotomayor would also recuse herself due to her participation in the Connecticut v. American Electric Power case when she was on the Second Circuit.  So any possible Supreme Court review may be complicated also by the recusal and quorum issues.

Stay tuned.  This one is getting even more interesting, if thatis possible.

 

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A federal court recently certified a class of Minnesota building owners in litigation over issues with plumbing systems. See In re: Zurn Pex Plumbing Products Liability Litigation, MDL No. 08-1958, 2010 WL 1839278 (D.Minn. 5/6/10).

The issue for our readers is not so much what happened, but what should have happened but did not.  I recently posted about the7th Circuit decision in American Honda Motor Co., Inc. v. Allen, 2010 WL 1332781 (7th Cir., April 7, 2010), mandating that trial courts rule on the admissibility of expert testimony at the certification stage of litigation when the testimony is critical to certification.  That is the only approach that makes any sense. Otherwise, the court risks certifying a class -- and engaging the parties in  the massive discovery and notice process that accompanies it  -- based on testimony that fails the Daubert test, is unreliable, and eventually inadmissible under the Federal Rules.  Here, the court refused to exclude the testimony of two plaintiff experts at the certification stage.  The court noted that the 8th Circuit had not yet adopted the approach of the 7th Circuit. 

Historically, potable water plumbing systems used copper pipes. In the 1990's, some companies designed plumbing systems using polybutylene plastic. After a wave of litigation involving allegedly failed polybutylene plumbing systems, defendant Zurn designed a cross-linked polyethylene plumbing system, commonly referred to as “pex,” as an alternative to polybutylene systems and copper plumbing systems. Plaintiffs were individuals who owned a home with a Zurn pex plumbing system. in several lawsuits, plaintiffs alleged that defective fittings used in the pex system caused their plumbing systems to leak resulting in damage to their properties. Plaintiffs also alleged that Zurn failed to adequately test the brass crimp fittings in their anticipated environments before marketing its product. In 2008, the Judicial Panel on Multi-District Litigation determined that the pex plumbing cases met the MDL test, and that centralization of the cases in Minnesota was appropriate.

Plaintiffs moved for certification of a class of all persons and entities that own a structure located within the State of Minnesota that contains a Zurn Pex plumbing system with brass crimp fittings.  Defendants, in turn, moved to exclude portions of the testimony of plaintiffs' experts, Dr. Wallace Blischke and Dr. Roger Staehle.  

Dr. Blischke, a statistician, performed an analysis of Zurn's warranty claims data and estimated that millions of Zurn's brass fittings will fail within the twenty-five year warranty period; he concluded that the fittings have a mean time to failure of 40 years.  Defendants offered evidence that the 40 years was based on unsupported assumption, not data.  The court admitted that as merits discovery unfolded and more information becomes available, Dr. Blischke's 40 year estimate for the mean time to failure "may or may not be admissible," but it would consider the expert testimony in support of class certification anyway and "has given such testimony proper weight."

Dr. Staehle then conducted a round of testing known as the U-bend test of brass specimens from Zurn's fittings. Defendants offered evidence that the reliability of Dr. Staehle's U-bend testing was undermined by his use of an artificially inflated level of strain, and they challenged the correctness of Dr. Staehle's calculation of the strain. The court concluded that "at this point" it would not exclude the testimony, which could be the subject of cross examination.

The certification battleground was 23(b)(3) predominance.  Defendants stressed that there were lots of possible causes of the failure of any particular plumbing system, and thus individual issues predominated.  Plaintiffs -- and here we see where the denial of a Daubert inquiry has its pernicious effect -- responded that the brass crimp fittings used in the pex plumbing system suffer from an inherent design and manufacturing defect, and that the parts were substantially certain to fail within the 25 year express warranty provided by Zurn and/or the useful life of the fittings.  And this was a set of predominating common issues, they said.  But they only get there through the testimony of the experts, not only on the merits, but on the presentation that the defects and useful life were demonstrable on a common basis through expert testimony about testing and time-to-failure.  So, for example, in certifying a warranty class for those plaintiffs whose systems had not yet failed, the court readily acknowledged being influenced by the fact that plaintiffs "allege, and intend to prove by expert testimony, that Zurn's brass crimp fittings suffer from a uniform, inherent design and manufacturing defect...."

Similarly, with regard to a class relying on a negligence cause of action, the court concluded that if plaintiffs can prove that the crimp fittings suffer from a uniform, inherent design and manufacturing defect, and that the defect is the only cause of failure in the majority of the cases, then proximate cause will not involve predominately individual determinations, and resolution of that issue would be common the class. For class certification purposes, the court was "convinced that Plaintiffs have adduced sufficient evidence to support their theory of the case."  But, of course, that evidence was arguably inadmissible expert testimony.

Since proof of reliance will likely vary among class members, and since defendants are entitled to present individualized defenses to reliance under Minnesota law, plaintiffs failed to show that the reliance component of their consumer protection claims could be proven by common evidence. Accordingly, class certification as to plaintiffs' consumer protection claims was denied.

But imagine how easy it can be to show "predominance" of common issues when your proof is unreliable, inadmissible, unscientific, expert testimony that just doesn't get screened.  Why should the gatekeeper role not impact entrance to the expensive, protracted world of a class action as much as to trial?

 

 

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Readers know how California's often extreme statutory and regulatory initiatives can influence toxic tort litigation.  Now comes word that California regulators last week released a proposed framework for forthcoming regulations to reduce certain chemicals in consumer products, as part of its “green chemistry” initiative.

The California Department of Toxic Substances Control’s release of an outline of the Draft Regulations for Safer Products is a second step in identifying "chemicals of concern" in California. The outline proposes guidelines for scientific and systematic prioritization of chemicals and products of concern, certification of alternatives assessment and development of DTSC’s regulatory response. Those responses may include banning substances or products, and end-of-life management issues. It also described a process manufacturers could use to evaluate the chemicals and safer have to perform an "Alternatives Assessment" for the product. Note that any public or private entity or individual may petition the Department to evaluate a chemical or a chemical and product combination during the prioritization process.

DTSC called for feedback on the outline.  The next step will be creating actual draft regulations based on the outline. The agency said that draft regulations will be released in the very near future, and that it will begin a formal rule-making process. State law requires the regulations be adopted by January 1, 2011.

California's green chemistry initiative, a statutory mandate since 2008, is an effort to identify and to reduce the use of chemicals that regulators conclude pose the greatest risk to public health and the environment. 

 

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A federal court recently sent back to China various Chinese families' product liability cases stemming from alleged melamine contamination of infant formula. See Tang v. Synutra International Inc., 2010 WL 1375373 (D. Md.).

Plaintiffs, one hundred Chinese citizens residing in China, brought suit on their own behalf as parents and on behalf of fifty-three minor children who allegedly suffered adverse health
conditions, predominantly the development of kidney stones, as a result of ingesting contaminated milk products produced by Defendants’ Chinese subsidiaries.  The principal place of business of both defendants, Synutra International, Inc., and Synutra, Inc., is in Maryland. Plaintiffs sought compensatory damages of at least $5.5 million for each child and $1.5 million for each parent, as well as a collective punitive damages award of $500 million. Defendants filed their motion to
dismiss on, inter alia,  the grounds of forum non conveniens.

In September 2008, the Chinese Administration of Quality Supervision, Inspection and
Quarantine (“AQSIQ”) initiated an emergency testing program of the country’s dairy supplies. Later that month, AQSIQ announced that certain lots of infant formula were found to have contained melamine, a chemical commonly used as an industrial component in plastics, adhesives, countertops, etc.  Melamine is not a food additive. It is not approved for human consumption.

By December 2008, approximately 300,000 Chinese infants were found to have ingested dairy products contaminated with melamine. Allegedly as a result, at least six infants have died and scores of others have required medical treatment for maladies associated with kidney damage. AQSIQ found varying amounts of melamine in sixty-nine batches of infant milk powder produced by several companies, including defendants' subs. In response to this crisis, the Chinese government, in conjunction with the China Dairy Industry Association, established a compensation program, funded by the dairy companies, that produced the contaminated milk products and totals approximately $160 million. It offered a lump-sum payment to the families of affected children, according to the extent of injury. To date, the families of approximately ninety-five percent of the injured children have reportedly accepted the remedies provided by the plan. Of those who have not, some have opted instead to bring suits in Chinese or U.S. courts.

The adequacy of the Chinese courts to adjudicate these suits was a significant point of contention between the parties; indeed, it was the critical factor of the forum non conveniens analysis in this case.

At the outset of any forum non conveniens inquiry, the court must determine whether there exists an alternative forum. The defendant bears the burden of establishing that the alternative forum is
available to all parties and that an adequate remedy is available to the plaintiff.  Although some courts conflate these issues, the availability and adequacy of the supposed forum are better seen as raising independent issues that warrant separate consideration by the court.

Ordinarily, a defendant can satisfy the availability element by showing that it is “amenable to process” in the alternative forum. Where the remedy offered by the alternative forum is so clearly inadequate or unsatisfactory that it is no remedy at all, however, the court may conclude that dismissal would not be in the interests of justice. Many courts have presumed the adequacy of the alternative forum and placed at least the burden of production on the plaintiff to establish otherwise.

Although plaintiffs here challenged both the availability and adequacy of the alternative forum to adjudicate their claims, there was no question in the court's mind that the Chinese forum was
available, since the defendant showed that it is “amenable to process” in the alternative forum.

Whether China constitutes an adequate forum was the primary issue in dispute. The dispute as to the adequacy of the Chinese forum boiled down to the competing declarations of the parties' China law experts. Defendants’ declarant opined that Chinese courts are adequate to resolve plaintiffs’ dispute and described that Chinese law provides causes of action for personal injury and products liability, a right to present evidence and argument in court, the power to compel witness testimony, and a right to appeal. Plaintiffs would be entitled to recover compensatory damages for expenses such as loss of income, related travel expenses, food subsidies, living expenses for dependents, as well as compensation for emotional damages, but not punitive damages.

Plaintiffs' experts claimed that “several volunteer milk attorneys” were summoned to a meeting held at the Beijing Bureau of Justice, a government entity, where an official demanded all attorneys to withdraw from representation on tainted-milk cases. The experts also asserted that the Chinese courts have denied litigants access to the courts, as well as the right to appeal an adverse ruling, because none of the complaints filed by contaminated-milk victims has been “either accepted or formally denied,”  resulting in the cases remaining perpetually in limbo. They also asserted that families of “seriously sickened children” receive $4,400, and “those suffering from other kidney problems” receive $292 under the government compensation scheme, and this is not “a legal remedy,” but rather “a settlement offer" made by the dairy companies,  In essence, plaintiffs asserted that the Chinese courts were deviating from normal process with respect to melamine claims and pressuring lawyers to withdraw representation of these claimants, thereby forcing the
unfortunate victims into a Hobson’s choice between pursuing futile litigation or accepting the "meager remedy" provided by the compensation program.

The court granted the motion, finding China an adequate forum.  The guiding principles included that the prospect of delay presented by the alternative forum does not typically render the alternative forum inadequate. The complaints had not yet been rejected in China. The court was not wiling to make the value judgment, on the basis of what it called limited evidence presented, that corruption in the Chinese judiciary would systematically deny access to a legal remedy there.  Courts have traditionally been reluctant to cast such aspersions on foreign judicial systems absent a substantial showing of a lack of procedural safeguards.

Second, even if the Chinese courts were not open to plaintiffs, another remedy was indisputably available to them, namely, the compensation program. While the plaintiffs characterized the
program as a “government-sanctioned settlement plan” from the companies that produced the contaminated milk products, as opposed to a legal remedy , they cited no authority for the proposition that the available remedy need be purely “legal” in nature. Regardless of whether it was enacted by the Chinese legislature or sanctioned by the judiciary, it is undisputed that the compensation program developed in China in the wake of the melamine contamination crisis was organized and sanctioned by government entities working in conjunction with the dairy industry and administered through an insurance provider.

Third, although the remedy offered by the compensation program was far less lucrative than what plaintiffs sought in the U.S., the courts have made clear, that the test is not to compare the rights, remedies, and procedures available under the law that would be applied in each forum to determine whether the law applied by the alternative forum is as favorable. 

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New York's highest court has ruled that a buyer assumed the liability for certain asbestos-related claims under a sale contract when it bought the boiler business of plaintiff American Standard Inc. back in 1970. American Standard Inc. v. Oakfabco Inc., 2010 WL 1286394 (N.Y., 4/6/10).

The court said that the issue here was whether the buyer of a boiler business assumed the seller's liabilities for tort claims based on boilers sold before the business was acquired, even where the tort claimants were not exposed/injured until after the acquisition. In 1970, American Standard, Inc. sold its Kewanee Boiler division to OakFabco, Inc. The parties entered an asset purchase and sale agreement in which the buyer assumed certain liabilities. The boilers manufactured by Kewanee had been insulated with asbestos, and as a result many tort claims were brought in the years and decades following the purchase of the business.

Some of those claims were brought by plaintiffs who had suffered injuries after the closing of the transaction, allegedly attributable to boilers manufactured and sold before the closing. In this declaratory judgment action brought by American Standard against OakFabco, the issue was whether liabilities for such injuries were among the liabilities that OakFabco assumed.  OakFabco argued that the definition of the liabilities OakFabco assumed was limited to "existing and outstanding” liabilities as of the Closing Date. According to OakFabco, a tort claim cannot be “existing and outstanding” before the tort plaintiff has been exposed and injured, because until then it is not possible for a tort lawsuit to be brought.

The court found, however, that the overall contract language meant that the buyer would deal with any problems customers had after the closing date with boilers that had been installed previously. It would have been absurd for OakFabco, said the court, to tell a customer whose boiler failed after the closing that, since the customer's claim was not “existing and outstanding” on the closing date, it was not OakFabco's problem. By including warranty, service, repair and return claims in the definition of liabilities, the parties demonstrated that they were not reading the words “existing and outstanding” as OakFabco now did.

The court therefore concluded that the liabilities assumed by OakFabco included claims brought by tort claimants injured after the closing date by boilers installed before that date.

The case is a timely reminder that an important aspect of evaluating the possible acquisition of a target company is the potential litigation liability that may be acquired simultaneously. If a target company is involved, or could potentially become involved, in mass tort litigation, it presents both risk and opportunity to the acquirer. The threat of this type of litigation may result in the opportunity to acquire a target at a below-market valuation multiple, and the uncertainty caused by mass tort exposure can result in valuation discounts that make the attendant risk acceptable. There are potentially significant risks, however, associated with mass tort litigation exposure, such as in asbestos, and thus buyers must proceed carefully. In the private equity context, in particular, mass tort litigation exposure can adversely impact the ability to secure third-party debt financing and can have an adverse impact on investment exit. Private equity purchasers may have shorter investment time frames than strategic buyers, and mass tort litigation often takes a substantial amount of time to resolve itself.

The general rule of law, and the typical structure of an asset purchase agreement, is that an acquirer of the assets of another corporation for cash does not acquire the liability for prior injuries caused by products sold by the target company prior to closing. It is crucial that the language be clearly drafted to reflect the parties' agreement on the allocation of such liability.

Even when the parties purport to allocate such liability to the target, however, the buyer may find itself responsible for the litigation through the operation of various legal doctrines that are exceptions to the general rule. The Restatement (Third) of Product Liability Law notes that a business entity that acquires assets of a predecessor business entity is subject to liability for harm caused by a defective product sold by the predecessor if the acquisition results from a fraudulent conveyance to escape liability for the liabilities of the predecessor, or results in the successor becoming a mere continuation of the predecessor. A few states also add the so-called “product line” exception, which allows a plaintiff to recover for injuries caused by a defective product sold by the predecessor in cases in which the successor corporation has continued the predecessor’s product line.

Thus, even in the absence of an actual merger or stock acquisition, or contract language assuming liability, it may be that a buyer of corporate assets will still face exposure to product litigation liability risks. Attempting to structure the deal to try to minimize the possible application of such theories will often be the first line of defense. In an asset sale, the buyer may also want to seek a provision that the seller shall not dissolve for some set period of time, so that the mass tort plaintiffs’ other remedies seemingly are not destroyed. Special indemnification by the seller for the underlying exposure is another alternative. This indemnification should survive for a sufficient period of time, and ideally would not be subject to a special cap higher than is typical for representations made by a “clean” company. The use of a special escrow to set aside funds for the litigation indemnification may be important.
 

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Sen. Frank R. Lautenberg, D-N.J., chair of the Senate Subcommittee on Superfund, Toxics
and Environmental Health, introduced this week the "Safe Chemicals Act of 2010," which would
amend the the Toxic Substances Control Act of 1976.

Over the last several months, Congress has held a series of hearings focusing on chemical safety and possible ways to modernize TSCA. Chemical business leaders, public officials, scientists, doctors, academics, and liberal environmental organizations have expressed support for varied methods of reforms to the principal toxic substance law. The “Safe Chemicals Act of 2010” comports with the reform principles laid out by the Obama Administration and groups such as the Safer Chemicals Healthy Families Coalition, and purports to address issues with TSCA identified by the GAO.

The bill (summarized here) is supposed to:

• provide EPA with sufficient information to judge a chemical’s safety, by requiring manufacturers to develop and submit a minimum data set for each chemical they produce, while also preventing duplicative or unnecessary testing. EPA will have full authority to request additional information needed to determine the safety of a chemical.
• Prioritize chemicals by having EPA categorize chemicals based on risk, and focus resources on evaluating those most likely to cause harm.
• Place a new burden of proof on chemical manufacturers to prove the safety of their chemicals, including all foreseeable uses, before the chemical may enter the market or continue to be used.
• Create more access to chemical information, by establishing a public database to catalog the information submitted by chemical manufacturers and the EPA’s safety determinations. The EPA will impose requirements to ensure the information collected is "reliable."
• Promote innovation and development of green chemistry, through grant programs and research centers to foster the development of safe chemical alternatives, and bring some new chemicals onto the market using an expedited review process.
  
  
   

It is clear that safety must be the primary goal of chemical regulatory reform, and the scientific and technological advances made since the passage of TSCA should allow industry and the regulatory agency to achieve a high degree of safety.  Certainly,  the need to prioritize chemicals for evaluation, a proper risk-based approach to EPA safety reviews, and a reduction in animal testing, are all aspects that should generate bi-partisan support. However, the bill’s proposed decision-making standard may be both legally and technically impossible to meet. Readers know how the articulation and application of the burden of proof can be outcome determinative. It is impossible to prove that something is "safe,” if one means risk-free. Every substance, even water, is hazardous to health at some levels in some exposure contexts. It would be devastating for our economy if this bill was merely a back-door attempt to make the so-called precautionary principle the law in this country, as it is in Europe. It is simply scientifically false that every chemical that is dangerous at high doses is also hazardous at low doses;  it is patently false that every chemical that causes effects in lab animals will also cause those effects in human beings.

And the proposed changes to the new chemicals program could very well hamper innovation in new products, processes, and technologies. In addition, the bill undermines business certainty by appearing to allow states to adopt their own regulations and create a lack of regulatory uniformity for chemicals and the products that use them.

Congressmen Henry Waxman and Robert Rush have proposed a "discussion draft" on the House side, and that may afford an opportunity for a transparent and meaningful discussion by all key stakeholder groups to ensure that TSCA reforms are based on sound science and protect the safety of all consumers, while promoting jobs and innovation.  In these uncertain economic times, the last thing needed is another expensive government program that risks doing more harm than good.

 

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We previously posted about a case in which a federal judge threw out  a purported class action against L’Oreal USA Inc. and Procter & Gamble Distributing LLC that accused the companies of selling Cover Girl and Maybelline lipsticks containing lead. Koronthaly v. L’Oreal USA, Inc., et al., No. 07-5588 (D.N.J. July 29, 2008).

The U.S. Court of Appeals for the Third Circuit has affirmed the decision. Koronthaly v. L'Oreal USA,  No. 08-4625 (3d Cir. 3/26/10).

Koronthaly purchased lipstick products manufactured, marketed, and distributed by appellees L’Oreal. and P&G. She alleged these lipstick products contained lead. The FDA does not regulate the presence of lead in lipstick, but Koronthaly asserted that the lipstick contained lead in greater amounts than permitted in candy by the FDA. Koronthaly alleged that she did not know when she purchased the products that they contained any lead, and when she learned of the lead content she immediately stopped using them. Moreover, had she known of the lead she claims she would not have purchased the products.

To prove constitutional standing, said the court of appeals, a plaintiff must demonstrate (1) an injury-in fact that is actual or imminent and concrete and particularized, not conjectural or hypothetical, (2) that is fairly traceable to the defendant’s challenged conduct, and (3) is likely to be redressed by a favorable judicial decision. Summers v. Earth Island Inst., 129 S. Ct. 1142, 1149 (2009). In this case, standing foundered on the first requirement, injury-in-fact, said the court.

Koronthaly’s argument that she was misled into purchasing unsafe lipstick products was belied by an FDA report finding that the lead levels in the defendants’ lipsticks were not dangerous and therefore did not require warnings. Moreover, Koronthaly conceded that she has suffered no adverse health effects from using the lipsticks. Koronthaly therefore had to fall back on only a subjective allegation -- that the trace amounts of lead in the lipsticks were unacceptable to her, not an injury-in-fact sufficient to confer Article III standing. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 564 (1992)(injury-in-fact must be accompanied by “continuing, present adverse effects”); Georgine v. Amchem Prods., Inc., 83 F.3d 610, 636 (3d Cir. 1996) (Wellford, J., concurring) (“Fear and apprehension about a possible future physical or medical consequence . . . is not enough to establish an injury in fact.”).

Furthermore, to the extent that Koronthaly contended that the injury-in-fact was the loss of her “benefit of the bargain,” she mistakenly relied on contract law, said the court. See Rivera v. Wyeth-Ayerst Labs., 283 F.3d 315, 319-21 (5th Cir. 2002) (plaintiff, whose only claim was that she “would like her money back” for having purchased a product that failed to make certain disclosures and allegedly was defective, did not have an injury-in-fact sufficient to create standing). Her lipstick purchases were not made pursuant to a contract involving lead levels, and therefore she could not have been denied the benefit of any bargain. Absent any allegation that she received a product that failed to work for its intended purpose or was worth objectively less than what one could reasonably expect, Koronthaly had not demonstrated a concrete injury-in-fact.

The dismissal was affirmed. In the lipstick wars, attention now will focus on Stella v. LVMH Perfumes and Cosmetics USA Inc., N.D. Ill., No. 1:07-cv-06509, dismissed 4/3/09; which is currently on appeal before the Seventh Circuit.
 

 

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The federal court in a toxic tort case has set aside the jury's punitive damages award. Garner v. BP Products North America, 2010 WL 1049794 (S.D.Tex.)(3/16/10).

The plaintiffs and over 100 other individuals filed suit against the defendant asserting that the defendant released an unidentified toxic substance into the atmosphere at its refinery causing personal injuries to workers. Several workers were transported to local hospitals where they were examined, treated, and released. At the time, the plaintiffs were employees of various sub-contractors at the site. In the trial of the first group of plaintiffs, a jury found for plaintiffs and went on to find that the conduct of the defendant was such that punitive damages should be awarded. It awarded punitive damages of $10 million to each plaintiff.

The punitive damages, inter alia, were challenged on post-trial motions. Under Texas law, in order to recover exemplary damages, the plaintiffs must establish at least gross negligence. The statute requires that the evidence pass both an objective and subjective test. The objective test requires a showing of an extreme risk of harm-- one that involves both high probability and high potential severity of an occurrence. Here, the trial court found the evidence failed to establish a legal connection between the event at issue and a known and extreme risk. The nature of refinery work is such that workers are subject to a variety of toxic odors at all times. The defendant, its employees and contractors, are generally aware of the potential hazards that exists in a refinery.  A disconnect existed here, however, said the court, because while there may have been some probability that a worker will be exposed to a toxic substance, the evidence did not support the high potential severity side of the test. Most of the exposures are minor and not harmful.

Nor did the evidence show a high probability of exposure from the same source. The source here was never identified, and in the prior releases or spills at the site, injuries were not always associated with each event and there was no showing of a recurring source.

Also missing from the equation, said the court, was the element of specific intent. The statute requires that the plaintiff establish a “specific intent” by clear and convincing evidence.  Specific intent requires more than a showing that a defendant had an awareness of the possibility of a spill or release. See Diamond Shamrock Refining Co. v. Hall, 168 S.W.3d 164, 171 (Tex.2005). It requires a showing that a defendant ignored the obvious or known risk and took no precautions that would minimize or arrest the harm anticipated. Id. at 171-72. The evidence showed that the defendant implemented safety precautions, such as requiring each worker to wear a monitor to detect the most toxic chemicals present at the refinery. And, there was evidence that monitors were installed and operational on the ground as well as on the towers in the refinery.

Therefore, the court concluded, as a matter of law, that gross negligence was not proved by clear and convincing evidence, and thus the jury's exemplary damage award must be set aside.

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A federal district court recently denied class certification in toxic tort litigation alleging that a chemical plant's long-term airborne release of vinyl chloride had risked their health and lowered property values. Gates v. Rohm and Haas Co.,  2010 WL 774327 (E.D. Pa. 3/5/10).

Plaintiffs alleged that vinyl chloride released from Rohm & Haas’s specialty chemicals manufacturing facility in Ringwood, Illinois contaminated the groundwater in and around McCollum Lake Village, as well as the air in the Village. Plaintiffs allege that between 1968 and 2002, the vinyl chloride evaporating from the shallow plume blew over the Village, contaminating the air in the Village and causing some Village residents to breathe varying amounts of it. Plaintiffs claimed that the levels of vinyl chloride in the Village air are higher than the background level. 

They asked the court to certify two classes: (1) a medical monitoring class, and (2) a property damage class.  On the latter, although plaintiffs alleged that the Village’s water and air have been contaminated, plaintiffs sought class certification only on the “outdoor air” theory. On the former class, the parties disputed whether, and the extent to which, exposure to vinyl chloride is associated with brain cancer in humans. Plaintiffs alleged that exposure to vinyl chloride placed Village residents at a higher-than-normal risk of contracting brain cancer, requiring periodic monitoring. In support of the medical monitoring program, plaintiffs submitted the report of an expert who opined that a class-wide medical monitoring regime using MRI's was medically reasonable given the alleged exposure to vinyl chloride.

Plaintiffs moved for certification of their property class under Rule 23(b)(3) and for certification of their medical monitoring class under both Rule 23(b)(2) and (b)(3). Rule 23(b)(2) permits certification where “the party opposing the class has acted or refused to act on grounds generally applicable to the class, so that final injunctive relief or corresponding declaratory relief is appropriate respecting the class as a whole.” Fed. R. Civ. P. 23(b)(2). Rule 23(b)(3) permits class actions where “the court finds that the questions of law or fact common to class members predominate over any questions affecting only individual members, and that a class action is superior to other available methods for fairly and efficiently adjudicating the controversy.” Fed. R. Civ. P. 23(b)(3).

The Third Circuit has clarified the legal standard for class certification and the district courts’ attendant duties in In re Hydrogen Peroxide Antitrust Litigation, 552 F.3d 305 (3d Cir. 2008).  The decision to certify a class calls for findings by the court, not merely a threshold showing by a party, that each requirement of Rule 23 is met.  Proper analysis under Rule 23 requires rigorous consideration of all the evidence and arguments offered by the parties.  Weighing conflicting expert testimony at the certification stage is not only permissible; it may be integral to the rigorous analysis Rule 23 demands. The court may not decline to resolve a genuine legal or factual dispute because of concern for an overlap with the merits. See also Hohinder v. United Parcel Service, Inc., 574 F.3d 169 (3d Cir. 2009).

As is typical, the battleground was the predominance and cohesiveness requirements of the rule.  (The court found that the individual issues that defeat the predominance requirement of Rule 23(b)(3) also defeat the cohesion requirement of Rule 23(b)(2)).

Regarding the elements of a medical monitoring claim, the court noted that whether vinyl chloride is a hazardous substance, whether a responsible monitoring procedure exists that makes the early detection of the disease possible, and whether the prescribed monitoring regime is different from that normally recommended in the absence of the exposure, did not here appear to present individualized questions in the context of this case.  (However, they can present individual issues in other cases depending on the substance, exposure, and risk.)

Next was the exposure element of the claim, with the key question being whether each plaintiff in the proposed class was exposed to a level greater than the normal background level. Plaintiffs must demonstrate that common proof may be used to determine whether each and every Class Member was exposed to a minimum level of vinyl chloride by Rohm and Hass that exceeds the applicable background levels.  While admitting individual exposure will vary depending on factors such as the time spent in the Village, plaintiffs asserted that class treatment is appropriate because there is a common minimum average daily exposure rate over time for any point within the Village. However, a rigorous analysis of plaintiffs’ expert evidence revealed that it does not reflect that all class members were exposed to vinyl chloride at a minimum level above  background, or that this determination could be made with common proof. Plaintiff's expert's  methodology  employed an averaging technique, making certification is inappropriate. Suffice it to say, an average is an average is an average. It is, in essence, a convenient fiction made up of numbers that are higher and lower than the average; it does not reflect whether every putative class member was exposed to vinyl chloride at a level above background, let alone at a level that carries a significantly increased risk of a latent disease. Exposures in the Village would vary  from year to year, such that a putative class member’s exposure would depend on the particular year or years in which he or she lived there. Individual class members’ locations and lifestyles potentially could result in significant differences in exposure, making Plaintiffs’ calculation of an “average exposure” even less useful. The time that each Village resident spent indoors, as opposed to outdoors, and the time that each individual spent away from the Village at work, away at school, on extended vacations, for example, are other factors that raise significant individual issues with respect to exposure levels. The evidence reflected that the putative class members’ habits, work schedules, and school schedules may have caused significant variations in the time that class members actually spent in the Village.

Of course, said the court, plaintiffs are not charged with the duty of calculating the precise exposure of any given individual, much less all of them, in order to secure class certification. However, plaintiffs must demonstrate that they can use common proof to demonstrate that each individual was exposed to a level above background levels. This, they had not done.

On the significant risk element, the court noted that it was impossible to tell from plaintiffs’ presentation of the average level of exposure to vinyl chloride - which itself is based on an average of certain vinyl chloride levels that were detected in certain test spots - whether every class member has a significantly increased risk of contracting a serious latent disease.  The first problem is that the level used by plaintiffs, derived from a regulatory figure, was not developed with an appropriate methodology for calculating a danger point for purposes of a medical monitoring claim. The value identified by plaintiffs only reflected the level of vinyl chloride at and below which a mixed population is safe, in the opinion of a public health agency. It did not, however, demonstrate the opposite, i.e., that any extra levels above the level are significantly harmful to necessitate medical monitoring.  Such a regulatory risk assessment cannot and does not support an opinion that each individual class member has experienced a significantly increased risk of disease.  The value may be appropriate as a prophylactic safety marker, perhaps for regulatory use, to minimize potential risks and protect the groundwater and air of a mixed population of individuals; however, it ought not be used as a predictive measure of actual risks for every individual in that population.  Precautionary measures to keep the general population safe are a fundamentally distinct form of relief from the medical monitoring cause of action. 

The court then turned to the question of whether the prescribed monitoring regime (that is, serial MRI exams) was reasonably necessary according to contemporary scientific principles. The court recognized that a medical monitoring program cannot be left open for the class members to fashion at will, but must consist of a specific form of monitoring different from what class members would ordinarily receive from regular physicals.  Plaintiffs argued  that serial MRIs are reasonable for the proposed class, but that in any event, the scheme could be modified after certification or allow individuals to tailor it to their particular circumstances (for example, a CAT scan for people who cannot tolerate MRIs).

The court had two problems with this argument.  One issue was what we may call the "more harm than good" calculus.  A blanket prescription for serial MRIs in asymptomatic individuals, coupled with the risks and drawbacks of serial MRI procedures, only strengthened the denial of class certification. For instance, the proposed class includes all residents of the Village, including children. The administration of MRIs to young children presents certain challenges because the children must lie still in the MRI machine for long periods of time. Conducting MRIs on children may require administering drugs to sedate or anesthetize them, a process that may prompt side effects of its own. The contrast agent used may pose risks for patients with kidney disease, for whom it can lead to nephrogenic systemic fibrosis, a potentially fatal condition; therefore, gadolinium is not recommended for use with such patients. In addition, medical monitoring in general, and MRIs in particular, can lead to stress and other adverse psychological consequences, and may induce claustrophobia in some patients.

The second problem with plaintiffs' flexible approach to their plan (i.e., that individual differences and medical needs can be accommodated through the use of CAT scans, open MRI machines, and other neurological exams. later), is that the determination of which accommodation, if any, is appropriate for which patient necessarily involves individual questions that cannot be determined on a class-wide basis. Moreover, the problems with the monitoring scheme can not be alleviated by a decision to just “deal with it later” at the summary judgment stage. Although the court may alter a monitoring scheme after the certification stage of the litigation has passed, that does not mean that problems with a monitoring plan can be ignored at the certification stage.

Turning to the property damage class, plaintiffs focused on "liability" as a common issue.  But the court found that even assuming that the fact of contamination was provable by common proof here, liability alone could not be proven with common proof. Common evidence may offer one potential source of the contaminants, but many other explanations may exist that are specific to a particular property. See Fisher v. Ciba Specialty Chems. Corp., 238 F.R.D. 273, 307 (S.D. Ala. 2006); see also Thomas v. FAG Bearings Corp., 846 F. Supp. 1400, 1404 (W.D. Mo. 1994).This can be especially true in this case, where differing levels of potential contamination over time affected different portions of the Village to different extents, depending on location, all of which must be compared to
the background level.

Finally, the court’s concerns about the number, complexity, and scope of issues that are plaintiff-by-plaintiff determinations also went to the superiority issue. Even if the court were to certify alleged common issues, the subsequent separate proceedings necessary for each plaintiff would undo whatever efficiencies such a class proceeding would have been intended to promote. Even more problematic, because a jury may be called upon to weigh the potential impact from Rohm and Haas’s actions on a particular property against those of another source of contamination, the “second” jury could well wind up re-considering the evidence of Rohm and Haas’s actions presented in the class proceeding.  

 

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A federal court recently granted the defendant's Daubert motion, excluding plaintiff's causation expert in a case alleging that defendant's chemical caused plaintiff's non-Hodgkins Lymphoma. Pritchard v. Dow Agro Sciences, et al., 2010 U.S. Dist. LEXIS 23098 (W.D. Pa. March 11, 2010).  The case is illustrative of three main points.

But first, the background. In this toxic tort case, Mr. Pritchard and his wife alleged that chemicals manufactured and sold by defendants caused Mr. Pritchard to develop NHL.  Plaintiff asserted claims of negligence and strict liability.  In particular, the dispute surrounded whether Mr. Pritchard's exposure to Dursban was the legal cause of his disease. Dursban is the trade name for a group of insecticide products containing chlorpyrifos as the active ingredient. The etiologies or causes of NHL and plaintiff's subtype, are generally unknown. Several risk factors have been identified, including: people with severe immunodeficiency, human immunodeficiency virus (HIV), human T-cell leukemia virus type 1, hepatitis C virus; a family history of NHL; and occupational exposure to herbicides, and certain other chemicals, said the court.

In support of their claim that Mr. Pritchard's exposure to Dursban caused his NHL, plaintiffs identified Dr. Bennet Omalu as their expert on medical causation and submitted his expert report. Defendants filed a Motion to Exclude the Expert Causation Testimony of Dr.  Omalu,  attaching rebuttal experts reports.  The court held a Daubert hearing during which the parties presented no additional evidence, only arguing the legal issues in dispute.  Under the federal rules, the district court acts as a gatekeeper, preventing opinion testimony that does not meet the requirements of qualification, reliability and fit from reaching the jury. In this role, the district court must satisfy itself that good grounds exist for the expert's opinion.

The opinions.  Dr. Omalu concluded that Mr. Pritchard's prolonged occupational exposure to Dursban insecticides significantly contributed to the patho-etiology of his Non-Hodgkin's Lymphoma. He described the general risk of exposure to pesticides to humans, stating that these chemicals are highly toxic and dangerous and have been identified as human carcinogens.  He further opined that no level of exposure to agricultural chemicals should be deemed safe. The expert testified at his deposition that he had considered and analyzed other potential causes of Mr. Pritchard's Non-Hodgkins Lymphoma, ruling out those other causes that were not sufficient to be a sole cause of the disease. Dr. Omalu also testified that diabetes may have contributed to Mr. Pritchard's disease but that it was "less likely to have contributed" and that Mr. Pritchard's obesity and body mass index were not highly associated with NHL. 

The challenge.  Defendants attacked the reliability of Dr. Omalu's proffered testimony, arguing that his opinions did not reliably establish general causation, i.e., that exposure can cause NHL, or specific causation, i.e., that Mr. Pritchard's exposure to Dursban caused his NHL. Courts in toxic tort cases often separate the causation inquiry into general causation -whether the substance is capable of causing the observed harm in general-  and specific causation -whether the substance actually caused the harm a particular individual suffered.  E.g.,  Perry v. Novartis Pharmaceuticals Corp., 564 F.Supp.2d 452, 463 (E.D.Pa. 2008).

General causation.  General causation is often established in a toxic tort case through the use of epidemiological studies. Epidemiology is 'the primary generally accepted methodology for demonstrating a causal relation between a chemical compound and a set of symptoms or a disease. E.g.,  Soldo v. Sandoz Pharmaceuticals Corp., 244 F.Supp.2d 434, 532 (W.D.Pa. 2003); Conde v. Velsicol Chem. Corp., 804 F.Supp. 972, 1025-26 (S.D.Ohio 1992); see also Perry, 564 F.Supp.2d at 465. Epidemiological studies examine the pattern of disease in human populations, General Elec. Co. v. Joiner, 522 U.S. 136, 144 n.2, (1997), and, more specifically, epidemiological evidence identifies agents that are associated with an increased risk of disease in groups of individuals, quantifies the amount of excess disease that is associated with an agent, and provides a profile of the type of individual who is likely to contract a disease after being exposed to an agent. Federal Judicial Center, REFERENCE MANUAL ON SCIENTIFIC EVIDENCE, Reference Guide on Epidemiology at 335-36 (2d ed. 2000).

The Third Circuit has recognized that epidemiology is a well-established branch of science, and epidemiological evidence has been accepted in numerous cases. The parties here agreed that general causation can be established through the use of such studies. (Of course, the leap from association shown by such studies to a causation conclusion is a judgment based on the assessment of the strength, power, and plausibility of the studies, among other factors.)  However, defendants challenged Dr. Omalu's general causation opinion that exposure to Dursban can cause NHL because his opinions did not rely on statistically significant epidemiological studies, and that Dr. Omalu did not rely on an epidemiological study showing an association between chlorpyrifos and NHL with a relative risk greater than 2.0. They also argued that Dr. Omalu's opinion was unreliable because he ignored published epidemiology studies which show a lack of an association or an inverse relationship between chlorpyrifos and NHL.

Plaintiffs contended that they were not required to present statistically significant studies which demonstrate an association between chlorpyrifos and NHL in order to demonstrate general causation. The court found that the law regarding the need for such epidemiological studies is not clearly established; therefore, the court was hesitant to adopt per se rules of admissibility but should consider the following as factors in determining the reliability of an expert's opinion on general causation: whether the expert relied on epidemiological studies; whether the expert ignored or sufficiently addressed epidemiological studies which contradicted his hypothesis, explaining the discrepancy between his hypothesis and that of the authors; and, whether the findings set forth in the studies are statistically significant.  Clearly if epidemiology studies are not available, an expert must offer a reliable causation opinion through the use of some other valid scientific methodology.

On the issue of relative risk, some courts have refused to consider epidemiology studies with less than a relative risk of 2.0 as supporting an association between a chemical agent and a disease. See Daubert v. Merrell Dow Pharmaceuticals, Inc., 43 F.3d 1311, 1320 (9th Cir.), cert denied, 516 U.S. 869 (1995); see also In re W.R. Grace & Co., 355 B.R. 462, 482 (D. Del. Bankr. 2006)(adopting 2.0 relative risk standard). Other courts have permitted the use of studies showing less than a 2.0 relative risk in support of a causation opinion. See In re Joint E. & S. Dist. Asbestos Litig., 964 F.2d 92, 97 (2d Cir. 1992). But see DeLuca by DeLuca v. Merrell Dow Pharmaceuticals, 911 F.2d 941, 958-59 (3d Cir. 1990)(if New Jersey law requires plaintiffs to show that it is more likely than not that Bendectin caused the injury, and if plaintiffs rely solely on epidemiological analysis in order to avoid summary judgment, the relative risk from the epidemiological data relied upon will, at a minimum, have to exceed 2).  Here the court decided to follow the approach taken in Magistrini v. One Hour Martinizing Dry Cleaning, 180 F.Supp.2d 584, 606 (D.N.J. 2002), where the district court explained that a relative risk of 2.0 is not so much a password to a finding of causation as one key piece of evidence, among others for the court to consider in determining whether an expert has employed a sound methodology in reaching his or her conclusion.

The court found that the expert had not relied on statistically significant studies. Some were clearly not significant, while on others there was no evidence of record explaining the method that Dr. Omalu used. Plaintiffs' counsel's heavy involvement in drafting the expert declaration further undermined the reliability of the opinions contained therein. (Plaintiffs' counsel admitted that he drafted the declaration, and the expert then signed it without any changes.) 

On the issue of the admissibility of expert testimony that fails to account for published epidemiology studies with conclusions contrary to the expert's opinion, the court looked at Perry v. Novartis Pharmaceuticals Corp., 564 F. Supp.2d 452 (E.D.Pa. 2008). In Perry, the district court recognized that "no reliable scientific approach can simply ignore the epidemiology that exists." Perry, 564 F.Supp.2d at 465.  Dr. Omalu never addressed two studies raised by defendants.  Dr. Omalu offered no explanation regarding the studies' findings and his hypothesis in this case.

Thus in sum, Dr. Omalu's general causation opinion that exposure to Dursban could cause NHL was found unreliable. Plaintiffs could not rely on Dr. Omalu's bare assertions that "studies" show that there is an association.

Specific Causation.  The court then turned to the parties' respective positions on Dr. Omalu's specific causation opinions that Mr. Pritchard's exposure to Dursban caused his NHL. Plaintiffs, as is typical, relied on a so-called differential diagnosis. The use of differential diagnosis is "the basic method of internal medicine," and is generally accepted for diagnosing a patient.  The process rules in potential explanations for the patient's symptoms, and then rules each disease out until a final diagnosis remains.  More controversial is its use to explain the cause of the disease.  But here the district court notes that it has been accepted in some courts as a technique that involves assessing causation with respect to a particular individual.  "Differential diagnosis, or differential etiology, is a standard scientific technique which identifies the cause of a medical problem by eliminating the likely causes until the most probable one is isolated."  Magistrini, 180 F.Supp.2d at 609.  Although the use of differential diagnosis is generally accepted, said the court, an expert's use of same must still be evaluated in order to ensure that the methods employed are reliable.  The mere statement by an expert that he or she applied differential diagnosis in determining causation does not ipso facto make that application scientifically reliable or admissible.

Here, defendants contended that Dr. Omalu's differential diagnosis was unreliable because of his limited review of Mr. Pritchard's case, not physically examining Mr. Pritchard, not reviewing all of his medical records and relying, in part, on an oral medical history transmitted to others.  The district court concluded that the expert's failure to review all of Mr. Pritchard's medical records, his discovery responses, his deposition testimony, his application records, or any other evidence regarding Mr. Pritchard's exposure to chlorpyrifos or other pesticides, left his opinions unsupported and rendered his differential diagnosis methodology unreliable.

While an expert may not always have to exclude all other theoretically possible causes, an expert surely must rule out obvious alternative causes, and also address the plausible alternative causes proposed by a defendant. It is necessary for the plaintiff's expert to offer a good explanation as to why his or her conclusion remains reliable in the face of plausible alternatives. Significantly, Dr. Omalu did not attempt to rule out that Mr. Pritchard's NHL is the result of an idiopathic or unknown cause despite the fact that the general cause of NHL is unknown. Standing alone, the presence of a known risk factor is not sufficient basis for ruling out idiopathic origin in a particular case, particularly where most cases of the disease have no known cause. Likewise, Dr. Omalu's conclusion that Mr. Pritchard's NHL is not idiopathic because he determined that his disease was caused by exposure to Dursban, was not a sufficient explanation, as it is merely a circular conclusion.  

Fit.  The court also found that the conclusion reached by Dr. Omalu did not reliably flow from the data and methodology used in this case. For one, the data was flawed as Dr. Omalu failed to properly consider all of the relevant materials, specifically, Mr. Pritchard's medical records, as well as all the exposure information. 

Finally, plaintiffs also raised a novel argument as an alternative to the defendants' challenges based on Federal Rule of Evidence 702 and Daubert and its progeny. They contended that the application of several principles argued by the defendants, if applied to exclude Dr. Omalu's testimony, would violate the Erie doctrine. (Yes, we are going back to first year civil procedure.)  The Erie doctrine provides that a federal court sitting in diversity must apply state substantive law and federal procedural law. In other words, the application of Daubert principles were inconsistent with state substantive law on causation.  The court noted first that the expert's proffered testimony was not being excluded solely on the challenged bases, which were considered among a host of other deficiencies in Dr. Omalu's proffered testimony. The court did not adopt any "bright-line" rules but instead evaluated the testimony using a "flexible" approach.  In any event,  the court briefly addressed the contention and concluded that state substantive law does not change the federal standard for the admissibility of expert testimony. Federal Rule of Evidence 702 could and must be applied to this action.

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The Senate Subcommittee on Superfund, Toxics, and Environmental Health convened a hearing last week with leaders of businesses that manufacture or use chemicals to hear their business views on reforming U.S. chemical safety law. The hearing was the third in a series of oversight hearings leading up to the possible introduction of legislation to reform the Toxic Substances Control Act (TSCA). 

Entitled "Business Perspectives on Reforming U.S. Chemical Safety Laws," the hearing featured testimony from Charlie Drevna, President of the National Petrochemical and Refiners Association.  His remarks addressed the call from some observers for a European-style replacement regulatory regime. The European Union has started to implement new legislation – Registration, Evaluation and Authorization of Chemicals (REACH), but many of the perceptions of REACH are incorrect. For example, rather than relieving the government of the burden of chemical safety, REACH only increases the burden on industry while it does not reduce the burden on government. No government authority is going to receive a chemical dossier from industry and take it at face value. Furthermore, REACH places so much burden on industry that small- and medium-sized chemical manufacturers are already facing significant difficulties complying with the program. REACH, contrary to some commentary, is unlikely to spur innovation in safer chemicals. Innovation is a function of spending on research and development and ease of entry into the marketplace. Toxicity and other laboratory testing is considered part of research and development and typically comes out of R&D budgets. That leaves less money for new, and often safer, product development. REACH is a regulatory concept that has never been attempted anywhere in the world, at any time. Authorities in Europe have already been inundated with so much information that they simply cannot keep up.
 

Dr. Neil C. Hawkins, Vice President, EH&S and Sustainability  for The Dow Chemical Company testified that an ideal chemical safety program would base its decisions on a consistent scientific
evaluation of both hazard and potential exposure (an evaluation of risk), using a weight-of-evidence approach. A weight-of-evidence approach requires critical evaluation of the entire body of available data for consistency and biological plausibility. Studies conducted and funded by industry are necessary and valuable contributions to the understanding of potential public health and environmental effects related to the manufacture and use of its products. Industry scientists have expert knowledge of the chemicals they manufacture, especially as this relates to the development and interpretation of the science needed to comply with governmental requirements around
the world. Research should be judged on the basis of scientific merit, without regard for funding source or where the studies are conducted (e.g. academia, government, or industry). 

Also testifying was Linda Fisher, Vice President, Safety Health and the Environment for DuPont.  She stressed in her remarks that as the agency contemplates exposure reductions it is important that the EPA be required to take into account the societal benefits from the use of chemicals and the time and complexity of bringing substitutes to market. Congress should avoid presumptive bans or rigid phase-out schedules. Bans and deadlines for phase-outs or substitution that fail to account for the realities of transitioning to new ingredients, receiving needed customer and regulatory approvals, or modifying manufacturing facilities, are counter-productive. Such actions could lead to unnecessarily disrupting markets, reduce public access to valued products, and cede markets to global competitors.

The issue of confidential business information, or CBI, also needs attention. The ability to preserve legitimate CBI and prevent piracy of intellectual property is critical to U.S. competitiveness and innovation. If companies simply give innovation away there is little reason to innovate.  Intergovernmental sharing of CBI data with proper protections, whether between state and federal governments or nation to nation, should be facilitated.

 

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Previously we alerted readers to the introduction of The Foreign Manufacturers Legal Accountability Act of 2009 (S. 1606),  introduced in the Senate in August 2009 by Sen. Sheldon Whitehouse (D-R.I.). The bill followed up on hearings last Spring during which witnesses testified about the perceived delays and difficulties with serving foreign manufacturers with process and establishing jurisdiction.

Last week, Rep. Betty Sutton (D-Ohio) and several co-sponsors introduced in the House their own version of the Foreign Manufacturers Legal Accountability Act of 2010 (H.R. 4678). The operative provisions of the House bill overlap those in the Senate bill, although the Senate bill also includes a section which discusses the alleged need for the legislation.

The proposed legislation would impact five categories of products: drugs, devices and cosmetics; biological products; chemical substances; pesticides; and consumer products. The bills only apply to manufactured products “in excess of a minimum value or quantity established by the head of the applicable agency" in regulations applying the legislation.

Both bills make consent to jurisdiction and service of process a condition of importing products into the United States. That is, the bills instruct several relevant product-regulating agencies to issue regulations requiring foreign manufacturers and producers to designate a registered agent. A person would not be able to import into the United States a covered product (or component part that will be used in the United States to manufacture a covered product) if such product or any part of such product (or component part) was manufactured or produced outside the United States by a manufacturer or producer who does not have a registered agent. 

Such a system which requiring an agent for service of process for every foreign manufacturer or producer who imports products into the U.S. would render the Hague Convention's  methods for service abroad unnecessary for such companies, and raises the risk that other countries may choose to create similar rules, subjecting U.S. companies to litigation in those other countries where their products may be sold.

Under the bills, a foreign manufacturer or producer of covered products that registers an agent as above thereby consents to the personal jurisdiction of the State or Federal courts of the State in which the registered agent is located for the purpose of any civil or regulatory proceeding.  Presumably, the expanded jurisdiction would also make it easier for U.S. companies to pursue indemnification claims against foreign manufacturers who were upstream suppliers.

Currently, foreseeing that one's product may enter a state is not, on its own, a sufficient basis for that state to assert jurisdiction. Asahi Metal Industry Co., Ltd. v. Superior Court, 480 U.S. 102, 112(1987); but cf. Nicastro v. McIntyre Machinery America Ltd., No. A-29-08 (N.J. 2/2/10).  It has been argued that Congress cannot create jurisdiction where the Constitution would forbid it. And it may be that a constitutional challenge would lie to some applications of the proposed bills. E.g., Texas Trading & Milling Corp. v. Federal Republic of Nigeria, 647 F.2d 300 (2d Cir. 1981). Presumably, the sponsors are looking to bypass the due process concerns by providing for consent to jurisdiction.

It is unclear what the effect of the bills might be on countries around the world regarding their willingness to enforce judgments entered in the United States, as the issue of the lack of foreign manufacturer assets in the U.S. is not addressed by the proposed legislation.

 

 

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We have posted on the climate change litigation, including inexplicable decisions such as the putative class action alleging that -- follow the chain -- dozens of oil and chemical companies emitted greenhouse gasses which contributed to an impact on the atmosphere which contributed to a rise in temperature of some parts of the ocean which contributed to making Hurricane Katrina stronger which contributed to additional damages to plaintiffs' property. Such decisions represent a clear and dangerous trend within certain courts to usurp Congress, warp the traditional nuisance doctrine, and plunge the federal courts into what are essentially political questions.
 

Now comes the welcome news that the Fifth Circuit has ordered en banc rehearing of the case. Comer et al. v. Murphy Oil USA et al., No. 07-60756 (5th Cir.). The court issued an order last week granting the defendants' petition for a rehearing en banc, vacating the panel decision from last Fall. The Fifth Circuit panel had ruled that private property owners under Mississippi law may have standing to bring climate change-related nuisance and trespass claims for both property and punitive damages.

The defendants will re-brief the issues by the end of this month, and oral argument appears to be set for the end of May.

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Your humble blogger will speak at the American Conference Institute's Chemical Products Liability and Environmental Litigation Conference (April 28-29, 2010).

On April 29, I will be joined by Gradient's Dr. Barbara Beck and Jerome Doak of Jones Day on a panel program entitled Presenting Effective Arguments to Courts Against Awarding Medical Monitoring Damages. Against the background of recent court decisions regarding medical monitoring, the program will address key legal and scientific issues often pivotal in medical monitoring cases. I will focus on medical monitoring class action issues.

More information here.

 

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The Senate Committee on Environment and Public Works' Subcommittee on Superfund, Toxics and Environmental Health held a hearing earlier this month entitled, "Current Science on Public Exposures to Toxic Chemicals."   Readers from the chemical and energy industries in particular will want to take note of the discussion.

Chairman Lautenberg (D.N.J.) opined that  TSCA fails to give EPA the tools it needs to protect against unsafe chemicals.He claimed that in three decades EPA has tested only 200 of the more than 80,000 chemicals in the products people use every day. He mentioned unnamed "studies" that allegedly have found that as much as five percent of cancers, ten percent of neuro-behavioral disorders and 30 percent of asthma cases in children are associated with hazardous chemicals. That is why, he said, he will soon introduce a bill that will overhaul our nation’s chemical laws, with the "simple goal" to force chemical makers to prove that their products are safe before they end up in a store. 

This bill would fall into place with the ideas of other proponents of radical reform and supporters of the so-called precautionary principle.  Common sense would suggest that principles for any regulatory or statutory changes to TSCA should be based on the best available science, including risk assessment; must include cost-benefit considerations; must protect proprietary information; and must prioritize reviews for existing chemicals. Senator Lautenberg's notion would encourage litigation, allow for activist rather than government enforcement, and would compel unnecessary product substitution that will further damage our weak economy.  Indeed, it would harm small and medium-sized companies and could harm innovation.

Other witnesses at the hearing included Steve Owens, Assistant Administrator, Office of Prevention, Pesticides and Toxic Substances Environmental Protection Agency;  Dr. Henry Falk  of the CDC; and Dr. Linda Birnbaum, Director  of the National Institutes of Environmental Health Sciences.

A number of witnesses also talked about bio-monitoring, the concept to potentially identify the concentration of chemicals actually taken up by the human body and the metabolic fate of those chemicals; to identify susceptible populations or particular at-risk groups (e.g. genetic polymorphisms) for chemical toxicity; and to inform discussions regarding levels of exposure consistent with no adverse effects (thresholds). However, bio-monitoring cannot eliminate potential confounders or alternative explanations for identified associations between chemical exposure and disease.  Any environmental chemical will be present to some extent in those who ingest, inhale or otherwise are exposed to it. Thus, the rabble-rousing about  “neurotoxins”, “endocrine disruptors”, or other “harmful chemicals” is essentially meaningless, without specific relationship to dose, exposure timing, and comparison to appropriate control populations. Our ability to measure substances at very low concentrations has outstripped our ability to determine causation.

Unfortunately, bio-monitoring has been abused as a tool. The practical problem with overstating exposure-disease associations is seen every day by medical professionals who evaluate people who are fearful of being “poisoned” by the latest chemical touted in a study as the cause of the same disease blamed on another compound just the month before, noted witness Dr. Charles McKay.

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The court in the welding fume MDL litigation has dismissed the claims of the  plaintiff who had been chosen for the seventh bellwether trial in this national consolidated welding fume products liability litigation. In re: Welding Fume Products Liability Litigation [Ernest Ray, No. 04-18252], MDL 1535, No. 03-17000, N.D. Ohio.

Plaintiff Ray had moved to dismiss his claim, with prejudice, last November. Thousands of claims have been dismissed in this litigation, so why post about this one?  A reminder to readers of MassTortDefense to travel all lanes of the information superhighway in doing fact investigation, including the so-popular social media hubs.

It appears that plaintiffs were forced to move to dismiss the Ray case after plaintiff’s claims of severe disability were refuted by Internet (specifically Facebook) photos discovered by defendants that appeared to show plaintiff competing in strenuous high-speed powerboat races.

In 2006, the MDL Court implemented a new case evaluation process to try to ensure that only “trial-worthy” cases reached the later stages of pre-trial litigation. This process, which required medical records collection and a certification by plaintiffs’ attorneys that cases were trial‐worthy, prompted plaintiffs to dismiss thousands of cases.  Even with that, this is about the sixth trial-ready case plaintiffs have been forced to dismiss due to revelations in discovery.

Appropriate review of public web sites requires no disclosure to opposing counsel, and can be done relatively cheaply. Today's technology, via the Internet, can result in a wealth of information on the opposing party or witness.  Web sites like the popular myspace.com and facebook.com can now provide a profile of a witness or opposing party, or, like here, information on interests and activities. An individual might have posted comments about his condition, as well. Good luck surfing!

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A federal court has excluded plaintiffs' expert testimony in litigation alleging personal injury and property damage from releases at a Midwest refinery.  Baker, et al. v. Chevron USA Inc., et al., No. 05-cv-00227 (S.D. Ohio Jan. 6, 2010). In the absence of necessary expert testimony, the claims were subject to summary judgment.

Plaintiffs in this case were residents of the villages of Hooven and Cleves, Ohio, who asserted claims for personal injury and property damage allegedly resulting from the Gulf Oil refinery, now owned by defendant Chevron USA.  Gulf operated a gasoline refinery which was situated on the eastern edge of Hooven from 1930 to 1985. Gulf also refined diesel fuel, jet fuel, and fuel oil at the refinery and operated an asphalt plant at this location. Gulf and Chevron merged in 1985, and Chevron closed the refinery in 1986.

Plaintiffs alleged that Gulf’s operation of the refinery resulted in the release of millions of gallons of gasoline and diesel fuel.  But these plaintiffs did not claim injuries resulting from groundwater contamination. Rather, they asserted injuries allegedly caused by air emissions from the refinery and, in particular, the benzene contained in those emissions. Benzene is ubiquitous in the ambient air and is a component or constituent of vehicle exhaust and cigarette smoke. In the petroleum industry, benzene is found in small amounts in gasoline.

For case management purposes, the matter was bifurcated between personal injury claimants and property damage claimants. The parties were permitted to select bellwether plaintiffs for each trial group. This opinion dealt with the claims of the bellwether personal injury claimants, and a key issue, as is often the case in toxic tort litigation, was causation.

Regarding their alleged benzene exposure, plaintiffs offered a three-step procedure. First, expert Dr. Cheremisinoff calculated a gross amount of benzene released from the refinery through emissions. Then, using those calculations, Dr. Rosenfeld, plaintiffs’ second expert, used an air flow model to calculate the cumulative dose of benzene to which each plaintiff was exposed. Third, using those dose estimates, a third expert, Dr. Dahlgren, submitted opinions that each plaintiff’s dose of benzene was sufficient to cause her illness. 

Chevron moved to exclude Dr. Dahlgren's opinions under Daubert, and for summary judgment contingent  upon the striking of  plaintiffs' causation evidence. The principal argument raised was that Dr. Dahlgren’s opinions were unreliable because there was an insufficient scientific or medical basis to conclude that the doses of benzene to which plaintiffs’ were exposed were large enough to have caused their illnesses. Relatedly, Chevron contended that there is an insufficient scientific or medical basis to conclude that benzene even causes some of the illnesses alleged. The Court held a hearing on Chevron’s Daubert motion during which Dr. Dahlgren and Chevron’s medical expert also testified.

In a toxic tort case, the plaintiff must present evidence of both general causation and specific causation. General causation establishes whether the substance or chemical at issue is capable of causing a particular injury or condition. Specific causation relates to whether the substance or chemical in fact caused this plaintiff’s medical condition. Without expert medical testimony on both general causation and specific causation, a plaintiff’s toxic tort claim will fail.

In this case, Dr. Dahlgren offered causation opinions based largely on epidemiological studies. (Epidemiology is the study of the incidence, distribution, and etiology of disease in human populations.) Epidemiology is usually considered highly probative evidence on general causation in toxic tort cases. The court may nonetheless exclude expert testimony based on epidemiological studies where the studies are insufficient, whether considered individually or collectively, to support the expert’s causation opinion. Nothing in either Daubert or the Federal Rules of Evidence requires a district court to admit opinion evidence that is connected to existing data only by the ipse dixit of the expert. A court may thus conclude that there is simply too great an analytical gap between the data and the opinion proffered.

A couple of parts of the court's detailed analysis are worth highlighting for readers of  MassTortDefense:

First, Dr. Dahlgren’s reliance on the “one-hit” or “no threshold” theory of causation in which exposure to one molecule of a cancer-causing agent has some finite possibility of causing a genetic mutation leading to cancer. The court noted that while the one-hit theory has been accepted for purposes of establishing regulatory safety standards, it has not been accepted as a reliable theory for causation under Daubert standards.  See Allen v. Pennsylvania Eng’g Corp., 102 F.3d 194, 199 (5th Cir. 1996) (“Scientific knowledge of the harmful level of exposure to a chemical, plus knowledge that the plaintiff was exposed to such quantities, are minimal facts necessary to sustain the plaintiffs’ burden in a toxic tort case.”); McClain v. Metabolife Int’l, Inc., 401 F.3d 1233, 1240 (11th Cir. 2005) (holding that district court erred by not excluding plaintiff’s expert’s causation opinion because he neglected dose-response relationship); Henricksen v. ConocoPhillips Co., 605 F. Supp.2d 1142, 1162 (E.D. Wash. 2009) (excluding expert’s opinion pursuant to Daubert where “he presumed that exposure to benzene in gasoline can cause AML in any dose.”); National Bank of Commerce v. Associated Milk Producers, Inc., 22 F. Supp.2d 942, 961 (E.D.Ark. 1998), aff’d, 191 F.3d 858 (8th Cir. 1999); Sutera v. Perrier Group of Am., Inc., 986 F. Supp. 655, 667 (D. Mass.
1997). Moreover, since benzene is ubiquitous, causation under the one-hit theory could not be established because it would be just as likely that ambient benzene was the cause of plaintiffs’ asserted illnesses.

Second, the court noted that to the extent that Dr. Dahlgren relied on the evidence that plaintiffs were exposed to benzene in excess of regulatory levels, that is insufficient to make his opinions admissible. The mere fact that plaintiffs were exposed to benzene emissions in excess of mandated limits is insufficient to establish causation. Nelson v. Tennessee Gas Pipeline Co., 243 F.3d 244, 252-53 (6th Cir. 2001); David L. Eaton, Scientific Judgment and Toxic Torts- A Primer in Toxicology for Judges and Lawyers, 12 J.L. & Pol’y 5, 39 (2003) (“regulatory levels are of substantial value to public health agencies charged with ensuring the protection of the public health, but are of limited value in judging whether a particular exposure was a substantial contributing factor to a particular individual’s disease or illness.”). This is because regulatory agencies are charged with protecting public health and thus reasonably employ a lower threshold of proof in promulgating their regulations than is used in tort cases. Allen, 102 F.3d at 198.

Third, the court focused on the issue of the link between cited literature and the actual specific opinion given. The court recognized that an expert’s opinion does not have to be unequivocally supported by all epidemiological studies in order to be admissible under Daubert. But here, the opinions expressed in Dr. Dahlgren’s revised report were based "on a scattershot of studies and articles which superficially touch on each of the illnesses at issue." The expert had not differentiated the cases in any way and simply assumed that each reference supported his causation opinion on each and every illness. That clearly was not the case. Also, none of the cited studies supported an opinion that benzene can cause the illnesses from which plaintiffs suffer at the extremely low doses or exposures experienced in this case. Even if it is medically accepted that benzene can cause disease at high doses, Dr. Dahlgren could not cite any paper finding that the relevant low cumulative exposure significantly increases the risk of developing the injuries.

The court, therefore, found that the expert's causation opinions were not reliable under the standards enunciated by Daubert and, consequently, inadmissible. Without Dr. Dahlgren's testimony, the plaintiffs were unable to establish that their illnesses were caused by alleged emissions from the plant, the court observed, and so granted Chevron's motion for summary judgment on all four bellwether personal injury plaintiffs.
 

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A federal judge has granted defendant's summary judgment motion in a putative consumer class action over contact lens solution. Degelmann, et al. v. Advanced Medical Optics Inc., No.07-0317 (N.D. Calif. 1/4/10).

Defendant, in 2007, issued a recall notice for their contact lens solution product, following an announcement by the U.S. Centers for Disease Control and Prevention that a small number of users of the contact lens solution might have developed a rare, but potentially serious, corneal infection, due to contamination.  The CDC report indicated that the epidemiological evidence showed that the product may be less effective than other solutions in disinfecting against the particular contamination. [Epidemiology, sometimes termed the "science of long division" or the "science of making the obvious obscure" is crucial to most toxic tort claims.]

Plaintiff brought a proposed nationwide class action under California Business & Professions Code § 17200 (Unfair Competition Law) and  § 17500 (False Advertising Law), and alleged that defendant AMO made false statements concerning its contact lens solution, and concealed certain known risks of using the solution. Plaintiffs did not allege that they suffered any physical injury from their use of the product.  Rather, the focus of the complaint was on AMO’s allegedly false representation that the product was a “disinfecting solution” or was a solution that “disinfects.”

AMO argued that the name plaintiffs had suffered no legally cognizable injury, and therefore lack both Article III standing and statutory standing under the UCL/FAL, among other summary judgment theories.  The court found that plaintiffs lack Article III standing, and granted the motion (without reaching the other issues).

The Constitution limits the federal judicial power to designated “cases” and “controversies.” U.S. Const., Art. III, § 2. Standing is an “essential and unchanging part of the case-or-controversy requirement of Article III.”  Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992). Article III standing requires a plaintiff to show an “injury in fact,” a causal connection between the injury and the conduct complained of, and a likelihood that the injury will be redressed by a favorable decision. Id. at 560-61; see also Sprint Communications Co., L.P. v. APCC Services, Inc., 128 S.Ct. 2531, 2535 (2008). In order to establish standing, plaintiffs must show that they have suffered actual loss, damage, or injury, or are threatened with impairment of their own interests. The “injury in fact” requirement must involve an invasion of a legally protected interest which is (a) concrete and particularized and (b) actual or imminent, not conjectural or hypothetical.  Lujan, 504 U.S. at 559-60

The court found that named plaintiffs could not show injury in fact because they  never contracted the infection at issue, and were never harmed by their use of the product. Because they stopped using the solution long before the recall, they could not allege that the recall caused them to discard unused solution, which is a typical "economic" harm argument plaintiffs try to make.  Moreover, they could not claim to have lost the money they spent purchasing the product in the first place, as they would have bought another, comparably priced, contact lens solution if they had not bought this one.  As plaintiffs sustained no damage and no injury, and made no showing of any sufficient  threatened injury that was likely to occur, they did not have standing under Article III.  Motion granted.

Defendants will want to not overlook the standing argument , especially when confronted with the concocted class claims of plaintiffs who were never really injured, and seek to recover for alleged bad conduct without showing any causal link between the conduct and an injury suffered.
 

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The Environmental Protection Agency recently issued its first Chemical Action Plan (CAP).  The plan deals with  phthalates, which are found in some food packaging and cosmetics.  But anyone in the chemical industry should take notice, as this CAP comes as part of EPA’s efforts to enhance the existing chemicals program under the Toxic Substances Control Act. EPA has identified an initial list of widely recognized chemicals, including phthalates, for action plan development based on one or more of the following factors: their presence in humans; persistent, bioaccumulative, and toxic  characteristics; use in consumer products; or production volume.

Although many in industry support  EPA’s effort to update agency actions for prioritized chemicals under TSCA, there is much to question in this effort so far, including the fact that the initial set of chemicals seem to have been selected based on their current “high-profile” nature. EPA should prioritize chemicals for the CAP program based on scientific criteria that reflect available hazard, use, and exposure information.  Despite the new Administration's campaign promises, there has been little transparency, and in fact great uncertainty, over the scientific basis for the selection of these chemicals.  Unfortunately, the CAP process to date provides no evidence of a systematic, science-based approach to chemicals management.

A large body of scientific data already exists about phthalates, and these products have been subject to numerous government safety assessments.  Bio-monitoring data shows that exposure to phthalates in the general public are below safety limits established by the EPA and the European Union. In assessing potential future restrictions on certain phthalates, EPA plans to weigh the relative toxicity and feasibility of phthalate substitutes. Identification of safer and affordable non-phthalate substitutes will be an important consideration in any action that would restrict the use
of these chemicals.  EPA intends to conduct a Design for the Environment and Green Chemistry alternatives assessment by 2012. The information developed could be used to encourage industry to move away from phthalates in a non-regulatory setting to expand risk management effects beyond whatever regulatory action might be taken under TSCA, or could be used as input to a regulatory action. 

EPA also intends to lay the groundwork to consider initiating in 2012 rulemaking under TSCA section 6(a) to further regulate phthalates. Readers know how regulatory events can spawn and impact toxic tort litigation.  It should be noted  that an Action Plan is intended to describe the courses of action the Agency plans to pursue in the near term to address its concerns. The Action Plan does not constitute a final Agency determination or other final Agency action.

 

 

 

 

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A quick update on the Chinese Drywall MDL.  With the recent filing of an omnibus complaint, approximately 3,000 plaintiffs are now involved in the product liability litigation over Chinese-made drywall, against approximately 600 defendants. In re: Chinese-Manufactured Drywall Products Liability Litigation, MDL No, 2047 (E.D. La.).  Plaintiffs allege generally that sulfur levels in the Chinese-made products are abnormally high, causing problems with air conditioning systems, appliances, internal wiring and other electrical systems, as well as personal injuries.  

The drywall imported from China could have been used throughout the United States in as many as an estimated 300,000 recently built or renovated homes. The U.S. Consumer Product Safety Commission reported on studies linking Chinese drywall installed in homes to elevated levels of hydrogen sulfide and the potential corrosion of metals.

Recently, the MDL court appointed Michael K. Rozen of Feinberg Rozen, LLP as a Special Master in this proceeding under Federal Rule of Civil Procedure 53. Pursuant to the order of the Court, Special Master Rozen shall carry out those tasks he deems appropriate to fully explore opportunities for an ultimate resolution between the various parties. 

At the December status conference, the court explored issues relating to the various profile forms: Plaintiff Profile Form, a Defendant Manufacturers’ Profile Form, a Contractor/Installer Profile Form, a Builder Defendant Profile Form and a Defendant Distributor Profile Form, and the Importer/Exporter/Broker Profile Form. And how to handle a party's failure to complete the required form. Another agenda item was prioritizing the many pending motions. The parties addressed some discovery disputes, including ESI.

An important issue also discussed was the the Court's general plan to establish initial  “bellwether” trials. The Court has further advised the parties that any such trials will be limited to property damage only. The parties have been discussing the protocol and procedure for selecting bellwether trial candidates. The Plaintiff Steering Committee has suggested a sufficient representative sample of cases be selected with regard to geography, concentration of properties, distinctive facts and certain legal issues. The defendants suggest that the selection of bellwether plaintiffs must be limited to the plaintiffs that have submitted profile forms where personal injuries are not claimed. A list of these plaintiff properties has been made available to the PSC and the Court. The parties were directed to continue to discuss the selection of bellwether trials.

It is already clear that the drywall litigation will be complicated. Homeowners are suing builders, installers, distributors and manufacturers. There are multiple levels of insurance litigation, as in some states plaintiffs may also bring direct actions against the insurers for any of those categories of defendants; some homeowners are also in dispute with their carriers as to coverage. Several defendants have sued their carriers. In some cases, insurance companies have already filed declaratory judgment actions on these issues. Moreover, there are cross-claims among categories of defendants, as builders are suing distributors, manufacturers, and their insurers.

As noted here before , a major issue is product identification, i.e., the identification of the maker and seller of the drywall in each plaintiff's building. Plaintiffs in the MDL have already identified 28 foreign labels that they allege may be involved.  Class action motions remain pending, among the difficult case management issues.  Indeed, some of the cases may end up being resolved as part of bankruptcy proceedings.

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Readers of MassTortDefense recognize that one feature of the asbestos litigation is the co-called family or household exposure case, a form of by-stander liability in which the plaintiff alleges he or she contracted asbestos disease not from exposures at work but through contact with a family member who brings the fibers home from a job.

A recent case explores this situation in a non-asbestos context.  In  Oddone v. The Superior Court of Los Angeles County, 2009 WL 4044429 (Cal. Ct. App.,  11/24/09), James Oddone worked for Technicolor, Inc., from 1973 until 2006; he died from a brain tumor (glioblastoma multiforme) in January 2007. His wife, inter alia, asserted on her own behalf the theory that her husband brought home toxic vapors and chemicals on his clothing and person and that she was injured by exposure to these materials; this cause of action was predicated on Technicolor's alleged negligence in exposing her husband to toxic chemicals.

Most claims of this type are analyzed, at first, with a duty analysis.  Here, the defendant argued, and the lower court agreed, there was no duty to the wife, using the traditional duty factors, including whether transaction was intended to affect the plaintiff; the foreseeability of harm to the plaintiff; the degree of certainty that the plaintiff suffered injury; the closeness of the connection between the defendant's conduct and the injury suffered; the moral blame attached to the defendant's conduct; and the policy of preventing future harm.

The court of appeals did agree with the proposition that this was the exact analytical framework for the case. Rather, the major factors ought to be ones are the foreseeability of harm to the plaintiff, the degree of certainty that the plaintiff suffered injury, the closeness of the connection between the defendant's conduct and the injury suffered, the moral blame attached to the defendant's conduct, the policy of preventing future harm, the extent of the burden to the defendant and consequences to the community of imposing a duty to exercise care with resulting liability for breach, and the availability, cost, and prevalence of insurance for the risk involved.

In order to apply those factors, however, a plaintiff claiming to have been injured by an exposure to chemicals must specify the chemical that caused the injury and in the course of doing so must of course also specify the injury. Importantly, he must also allege that as a result of the exposure the specified toxin entered his body.  The court said it does not make a difference that the plaintiff is claiming injury as a result of secondary exposure. If anything, the exposure requirements are even more apropos in such a case because the connection between the defendant's acts and the claimed injury is more attenuated than in a primary exposure context.

"It cannot be denied that a case predicated on secondary exposure to chemicals potentially cuts a very wide swath," said the court of appeals.  It is therefore only appropriate to pay close attention to the factor that there must be a close connection between the defendant's conduct and the injury suffered. That connection is only shown by setting forth specifically which chemicals cause which specified injuries. In a secondary exposure case, the allegation that as a result of the exposure the specified chemical entered the plaintiff's body is of particular importance. Central issues in such a case are whether secondary exposure to a specified chemical is even possible and, if it is, whether the exposure will result in the ingestion of the chemical into the plaintiff's body.

Turning to policy issues, the court did not hold that a plaintiff cannot ever state a cause of action for secondary exposure to toxic chemicals.  But, as part of the analysis, including “all family members” into the category of those owed a duty would be too broad, as not all family members will be in constant and personal contact with the employee. Limiting the class to spouses would be at once too narrow and too broad, as others may be in contact with the employee and spouses may not invariably be in contact with the employee. Limiting the class to those persons who have frequent and personal contact with employees leaves at large the question what “frequent” and “personal” really means.  The gist of the matter is that imposing a duty toward non-employee persons saddles the defendant employer with a burden of uncertain but potentially very large scope. One of the consequences to the community of such an extension is the cost of insuring against liability of unknown but potentially massive dimension. Ultimately, such costs are borne by the consumer.

Here, the court of appeals could not say that the trial court abused its discretion in sustaining the demurrer to the first amended complaint without leave to amend.

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We have posted about nanotechnology issues before. Readers following nano-issues will want to note that the Council of the European Union last week approved an updated set of regulations on cosmetic products, and they include a requirement that cosmetics containing nanoscale ingredients have that information on their labels. [In the European Union, regulations automatically apply to all  member states, while directives are implemented through national legislation. The regulation thus represents a common European code on cosmetic products, designed to reduce the uncertainties arising from a differentiated implementation of the previous directives in the 27 member states.]

Specifically, the regulation states that, “All ingredients present in the form of nanomaterials shall be clearly indicated in the list of ingredients. The names of such ingredients shall be followed by the word ‘nano’ in brackets.”  see p. 61.  Some observers have questioned whether the mention of the term "nano" in labels will offer consumers much meaningful guidance. The FDA's 2007 Nanotechnology Task Force Report did not recommend labeling because current science did not support a finding that products with nanoscale materials necessarily present greater safety concerns than those without nanoscale materials.

The document indicates that the use of nanomaterials in cosmetic products may increase with the further development of technology. In addition, the EU Council suggest that in order to ensure a high level of consumer protection, free movement of goods, and legal certainty for manufacturers, it is necessary to develop a uniform definition for nanomaterials at the international level.  In the interim, "nanomaterial" for regulatory purposes means an insoluble or biopersistant and intentionally manufactured material with one or more external dimensions, or an internal structure, on the scale from 1 to 100 nm.

The Council states that, at present, there is inadequate information on the risks associated with nanomaterials. In order to better assess their safety, the Council calls for cooperation with relevant bodies on test methodologies which take into account specific characteristics of nanomaterials.

The new rule also will require manufacturers of new cosmetic products containing nanomaterials to notify the European Commission and to provide certain toxicological information before the products are placed on the market. Published reports suggest that manufacturers may have up to 3 years to comply with the new label regulations.

 

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To date, CPSC has received more than 2000 reports from 32 states, the District of Columbia and Puerto Rico, from consumers and homeowners concerned about alleged problem drywall from China in their homes. The majority of consumer complaints on allegedly defective drywall have come from Florida and Louisiana.

The CPSC last week released a study of Hydrogen Sulfide Gas in connection with its Chinese drywall investigation.  Specifically, CPSC released results from a major indoor air study of 51 homes, and initial reports from two studies of alleged corrosion in homes with Chinese drywall. The 51 home study was actually contracted by CPSC and done by Environmental Health & Engineering (EH&E). The  two preliminary reports on corrosion safety issues are from the Sandia National Laboratories’ (SNL) Materials and Engineering Center concerning the long-term electrical safety hazards of conductor metal components, and the National Institute of Standards and Technology (NIST), studying the corrosion effects on fire safety components taken from complaint homes.

EH&E compared 41 “complaint” homes in five states selected from CPSC’s consumer
incident report database, with 10 non-complaint homes built around the same time in the
same areas as the complaint homes. Homes were sampled between July and September
2009. The EH&E findings were that hydrogen sulfide gas appears to be the essential component that causes copper and silver sulfide corrosion found in the complaint homes. Other factors,
including air exchange rates, formaldehyde and other air contaminants appear to contribute to the
reported problems.  The reports do not explain how the hydrogen sulfide gas is being created in homes built with Chinese drywall. (Earlier studies found varying amounts of elemental sulfur in the Chinese drywall.)

In terms of method, EH&E exposed copper and silver test strips, known as coupons, in homes for a period of about two weeks. The coupons showed significantly higher rates of corrosion in complaint homes than in the control homes. The dominant species of corrosion on the coupons were copper sulfide and silver sulfide, as determined by additional laboratory tests. Visual inspection and evaluation of ground wire corrosion also revealed statistically significant greater ground wire corrosion in complaint homes compared to non-complaint homes. The EH&E study also found that by using hand-held x-ray fluorescence and Fourier Transform Infrared instruments, they were able to detect markers that could identify Chinese-made dry wall at a sheet-by-sheet level.

The study did not link the corrosion with any long term safety effects, which are still under investigation. The levels reported, however, are well below the amount associated with long term health effects in the literature.

Like the EH&E study, initial reports from SNL and NIST show copper and silver sulfide corrosion on samples of metal taken from homes with problem drywall.

In terms of next steps, CPSC continues to search for homes exhibiting the alleged corrosion and health effects under study. Second, the federal Interagency Task Force has established an Identification and Remediation Protocol Team of scientists and engineers. This Team will try to use the results of the EH&E study and other information to design a screening protocol to identify homes with this problem.  Because professional air sample testing, and destructive testing of drywall both are costly, the Protocol Team is trying to develop quick, cost-efficient evaluation methods to identify homes with these problems. The Protocol Team will also look at remediation protocols, to see what cost-efficiency improvements to current remediation practices, if any, may be available, and what guidance should be issued on doing the work safely.

CPSC believes it has secured the cooperation of the Chinese Government to help identify the sources and causes of this problem. The agency believes that no new Chinese drywall has entered the United States in 2009. CPSC is also working with an ASTM committee that has just initiated discussions on the formulation of a proposed new standard on inspection of drywall for air quality issues.

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The Senate Committee on Environment and Public Works and the Subcommittee on Superfund, Toxics, and Environmental Health held a joint hearing yesterday, entitled “Oversight Hearing on the Federal Toxic Substances Control Act.”

The Senators heard testimony from Lisa Jackson, head of EPA; John Stephenson, Director of Natural Resources and Environment for GAO; and Linda Birnbaum, head of NIEHS and the National Toxicology Program.

Administrator Jackson argued that the Toxic Substances Control Act is in urgent need of reform because of "troubling gaps" in knowledge about many chemicals that have come into wide use since. She asserted that manufacturers of various “grandfathered” chemicals weren’t required to develop and produce the data on toxicity and exposure that are needed to properly and fully assess potential risks. [In a bit of drama, EPA’s Jackson was asked about some of the troubling emails recently disclosed about the apparent concerted effort of some to quash any scientific dissent to an aggressive view of global warming.]

The American Chemistry Council has noted that updating the legislation in certain respects made good sense, favoring a comprehensive approach, rather than the current patchwork of state and federal laws governing chemicals.

GAO’s representative testified that TSCA generally places the burden of obtaining data about existing chemicals on EPA rather than on chemical companies. For example, the act requires EPA to demonstrate certain health or environmental risks before it can require companies to further test their chemicals. As a result, EPA does not routinely assess the risks of the over 83,000 chemicals already in use. Moreover, TSCA does not require chemical companies to test the approximately 700 new chemicals introduced into commerce each year for toxicity, and companies generally do not voluntarily perform such testing.

Dr. Birnbaum encouraged Congress to call for utilization of the new kind of toxicological testing that is less expensive and also gives an improved understanding of the actual effects of chemicals on humans. Toxicology is advancing from a mostly observational science using disease-specific models, she said, to a better, predictive science focused upon a broad inclusion of target-specific, mechanism-based, biological observations. This means using alternative assays targeting the key pathways, molecular events, or processes linked to disease or injury, and incorporating them into a research and testing framework.

Democratic legislators, including Sen. Lautenberg (D-NJ) have called for increased requirements for chemicals testing, and that “It's time to sound the alarm.” In an attempt to respond to industry concerns, Lautenberg argued that stronger regulations would somehow protect chemical companies from product liability suits—an ironic assertion at best as Democrats actively work to overturn express preemption for medical devices and extol the Wyeth v. Levine decision restricting implied preemption of drugs.

Of particular concern to readers of MassTortDefense would be efforts to eliminate the current risk-based review system under TSCA and force EPA to use the so-called precautionary principle.

It seems more supportable that any overhaul of TSCA should include the notion that scientific reviews must use data and methods based on the best available science and risk-based assessment; must include cost-benefit considerations for the private-sector and consumers; must protect proprietary business information, and should logically prioritize reviews for existing chemicals.

 

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A federal court last week denied class certification in a case arising from alleged damage to boats allegedly caused by ethanol blended gasoline. Kelecseny v. Chevron U.S.A., Inc., et al., No. 08-61294-CIV-ALTONAGA/Brown (S.D. Fla. Nov. 25 2009).

Recent federal and state legislation requires that ethanol usage be expanded and that gasoline contain 9 to10% ethanol by December 31, 2010. Plaintiff sued several defendant gasoline manufacturers who have produced and/or marketed the ethanol blended gasoline (E10) used by the proposed class members for use in boats and watercraft in Florida allegedly without adequate warnings to consumers. The plaintiff asserted that E10 can cause difficulty starting the engine or rough engine operation, engine overheating, engine fires,  corrosion of aluminum tanks, degradation of fiberglass tanks and resins, and other damages.

The court noted the evidence that some defendants have, in other countries, posted warning signs that E10 may not be suitable for use in boats. Numerous articles have appeared in boating magazines, some boat manufacturers provide E10 warnings in their owners’ manuals, and many marine mechanics are aware that E10 may cause problems in certain types of boats.

 

The class sought relief against all defendants under a “market share” theory of negligence, based on Conley v. Boyle Drug Co., 570 So. 2d 275, 286 (Fla. 1990), alleging that because of the general methods for the use and distribution of gasoline used to fuel boats, plaintiffs did not know the identity of each of the named defendants that sold the ethanol blended gasoline that they purchased for use in their boats.

 

Our review focuses on the damages class, defined as owners of boats in the state of Florida whose fuel tanks are composed of polyester of vinyl ester resin fiberglass fuel tanks. The court noted first that even to determine whether certain individuals may be in the class, a detailed individual inquiry would be required. Because it would be impossible to definitively identify class members prior to individualized fact-finding and litigation, the proposed class fails to satisfy the most basic requirements for a class action under Rule 23, ascertainability.

 

Turning to the Rule 23(a) factors, while it is possible that the proposed class could satisfy the numerosity requirement, plaintiff had not made a clear showing that the number of actual class members will be so high that joinder of all members is impracticable. Plaintiff argued that his starting number (680) was so large that defense attempts to carve certain boats out of the total number would never work to defeat numerosity. However, courts have made it abundantly clear that the burden to satisfy numerosity is on the plaintiff seeking to certify a class, and a plaintiff is not permitted to make a purely speculative showing that numerosity has been met.

 

Next, although typicality “does not require identical claims or defenses,” a factual difference in the representative’s claims will render those claims atypical if the factual position of the class representative “markedly differs from that of other members of the class.” Named plaintiff’s damages claims and the defenses to those claims differed markedly from those of other potential class members, said the court. The uncontroverted expert testimony at the certification stage established that the type of fiberglass tanks at issue are found in relatively large boats that are not suitable to be transported or carried by trailer.  Owners whose boats are equipped with fiberglass fuel tanks, therefore, are most likely to purchase their fuel at marinas, where their boats are kept or to which they travel on water for fueling. In contrast, plaintiff purchased fuel for his boat at numerous gas stations by use of a fuel caddy that he carried in his pick-up truck. Expert witnesses and the parties agree that this behavior was atypical. This difference in behavior between named plaintiff and other potential class members “jeopardizes Plaintiff’s ability to sue Defendants collectively under a market share theory.”

 

Importantly, the court noted that plaintiff cited no case in which market share liability has been applied in a class action, “and there appears to be good reason why no such case exists.” It is simply untenable to apply market share liability [in those few states that recognize it], with its requirement of the narrowest possible geographic market, to a class action consisting of members whose activities cover an entire state.  The requirement of a narrowly tailored geographic market is particularly important in market share liability cases because only with a narrow geographic market may a defendant avail itself of the defenses afforded by the market share theory.

 

On the Rule 23(b) factors, plaintiff’s argument disregarded the many individualized inquiries that would be required in the proposed class action and which clearly outweighed the asserted common issues. As to each individual plaintiff, a fact finder would have to determine where that particular plaintiff purchased fuel, and what, if any, warnings were in place at that station at that time or at different times. Also, plaintiffs had to show that defendants’ failure to warn of the dangers of E10 was the proximate cause of the damage to the boats. This requisite showing raised two issues of individualized inquiry. First, each proposed class member must demonstrate that had warnings of the danger of E10 existed, he or she would have heeded those warnings and not used E10 in his or her boat. Non-ethanol blended fuel is more difficult to find than E10 and is generally more expensive than E10. It is conceivable that some boat owners, even if warned that E10 might damage their fuel tanks, would opt for the convenience and lower cost of E10, and assume the risk of damage. Indeed, plaintiff himself apparently continued to use E10 in his boat despite his knowledge of the risks.

 

The proximate cause requirement also mandates an individualized inquiry into whether each proposed class member had personal knowledge that E10 could damage fiberglass fuel tanks. As noted above, some information was available from other sources that E10 may not be appropriate.

Finally, the court noted something that is extremely important to readers of MassTortDefense, and which some courts ignore: fact issues can be created by defenses and by a defendant’s response to plaintiff’s claims. If those fact issues are individual, that is every bit as important to the class certification decision as individual issues raised by plaintiff’s own affirmative proof. While plaintiff’s experts asserted that no individual examination of fiberglass fuel tanks was necessary, defendants’ experts disagreed. Thus, inspection of the fuel tank of each proposed class member was a reasonable request to determine whether any existing damage was actually caused by E10.

Similarly, defendants have the right to assert the comparative fault defense, and its assertion would involve individual inquiries concerning each proposed class member’s knowledge and behavior. Inquiry would be necessary as to whether each boat owner received an owner’s manual that warned against the use of E10; whether any had ever been told by a mechanic not to use E10; whether any had ever seen a warning sign at a marina or researched E10 on the internet; and whether, despite personal knowledge, the boat owner nonetheless chose to fuel the boat with E10 based on convenience and cost savings.

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Readers interested in nanotechnology issues may be interested in the Second NanoImpactNet Conference on the future with nanotechnology.  It is to be held in Lausanne, Switzerland, March 9-12, 2010.

Information on the preliminary program is available here.

And information on abstract submission and registration for the conference is available here.

The conference is organized by NanoImpactNet, a European network on the health and environmental impact of nanomaterials, including academic and government laboratories
working on nano-toxicology and nano-ecotoxicology. 

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A federal court has granted defendant CSX Transportation, Inc.’s Motion for Summary Judgment in a medical monitoring case arising from a train accident. See Mann v. CSX Transportation, et al., NO. 1:07-cv-3512 (N.D. Ohio Nov. 10, 2009).

The case arises from the derailment of 31 rail cars, nine of which contained hazardous materials, and the subsequent fire that burned for around sixty hours. Ohio emergency personnel oversaw an
evacuation of a one half mile radius. The next day, plaintiffs filed a putative class action complaint in state court, which was removed to the Northern District of Ohio. Plaintiffs’ complaint, under
theories of strict liability and negligence, primarily sought the establishment of a judicially administered medical monitoring program.

After discovery had been completed, defendant filed its motion for summary judgment. The court began by noting that Ohio law recognizes medical monitoring as a form of remedy for an underlying tort. See Wilson v. Brush Wellman, 817 N.E.2d 59, 63 (Ohio 2004). (Readers will note some states consider it a separate cause of action.) Therefore, medical monitoring is only granted if a plaintiff is able to prove all the elements of the underlying tort and the elements of medical monitoring. On the first part, in order to avoid summary judgment, plaintiffs thus must make a showing of a genuine issue of material fact as to the elements of a negligence claim under Ohio law: (1) defendant had a duty to plaintiffs, (2) defendant breached that duty, and (3) plaintiffs suffered damages directly and proximately caused by defendant’s breach. See, e.g., Menifee v. Ohio Welding Products, 15 Ohio St. 3d 75, 77 (Ohio 1984).

The first two issues were not contested for purposes of the motion. On injury and causation, the court noted the overlap with typical medical monitoring requirements, such that to meet this aspect of their negligence claim plaintiffs must demonstrate a genuine issue of material fact that: (1) the chemicals (dioxins) released into the air by the fire are known causes of human disease; and (2) that the plaintiffs were exposed to the dioxins in an amount sufficient to cause a significantly increased risk of disease such that a reasonable physician would order medical monitoring.

Plaintiff experts relied on classifications of the chemicals as carcinogens as their only evidence that dioxins cause the various endpoint diseases for which they seek medical monitoring.  Plaintiffs’ experts also failed to provide an independent assessment of the causal link between dioxins and disease.  Instead they "parroted" the conclusions of other experts and cited to EPA, IARC and NTP documents labeling dioxins as known carcinogens. This was an insufficient showing, said the court.

But even if plaintiffs could demonstrate a causal relationship between dioxins and cancer, plaintiffs had failed to establish that they were exposed to dioxins in an amount warranting a reasonable physician to order medical monitoring. See Day v. NLO, 851 F.Supp.869, 881 (S.D. Ohio 1994).

Plaintiffs’ theory was that they were at an increased risk of disease because they lived for eighteen months with alleged contamination from the fire inside and around their homes. However, none of the named plaintiffs presented evidence that a physician has examined them or their medical records and opined that they are at an increased risk of disease. Similarly, plaintiffs’ experts had not conducted any measurement of dioxin inside or outside of the homes of five of the seven named plaintiffs. At least three of the seven had not even lived in their air dispersion modeling expert's "impact zone" long enough to qualify for his proposed medical monitoring program. Even for those that did, mere residence in the so-called impact zone is insufficient evidence of sufficient contamination and increased risk because it ignores any individual variables, including other sources, and most notably, at what level each of the named plaintiffs was actually exposed to dioxins. The Sixth Circuit has stated “generalized proofs will not suffice to prove individual damages.”  Sterling v. Velsicol Chem. Corp., 855 F.2d 1188, 1200 (6th Cir. 1988).

Again, even if plaintiffs had presented sufficient evidence of the amount of named plaintiffs’ dioxin exposure, plaintiffs did not demonstrate that a reasonable physician would order medical monitoring based on this exposure. Plaintiffs attempted to rely upon the EPA soil cleanup level after the accident as a basis for justifying medical monitoring. The court found two fatal defects in using this EPA soil cleanup level. First, demonstrating why regulatory guidelines are often not useful in the tort litigation context, see Rowe v. E.I. DuPont de Nemours & Co., 2008 WL 5412912 (D.N.J. Dec. 23, 2008); Redland Soccer Club, Inc. v. Dep’t of the Army, 55 F.3d 827 (3d Cir. 1995), the EPA soil cleanup level represented a threshold for the cleanup of contaminated soil, not a danger point
above which individuals would require medical monitoring. And even if government regulations were relevant to showing increased risk, a conservative soil cleanup level should not be used in place of a medically based risk assessment or evidence of the actual dose level at which dioxin truly causes cancer – the danger point critical to a medical monitoring determination.  Second, the EPA’s threshold soil cleanup level represents an increase in the risk of developing cancer from the baseline level for the general population of one in a million. Thus, even assuming there were a million members in this class who had been exposed to this level of dioxin over their entire lives, and assuming causation, only one of them would develop cancer because of the exposure. Plaintiffs thus sought to commence medical monitoring based on this one-in-a-million risk, but this risk and indeed risks higher, have been found insignificant as a matter of law.  Medical monitoring typically requires a significantly increased risk. Plaintiffs' expert opinion to the contrary was a legal conclusion, and thus it did not create a genuine issue of material fact.

In sum, the court concluded that the plaintiffs had not presented a genuine issue of material fact that the circumstances would warrant a reasonable physician to order medical monitoring. Medical monitoring in Ohio is a form of relief which should only be granted "with prudence."  Interestingly, the court concluded that plaintiffs’ proposed program would likely be extremely expensive, said the court, and inconvenience thousands of people for many years in the future. (Note to readers, the potential down-sides of medical monitoring must be explored in each case.) Plaintiffs had not presented enough evidence for a reasonable jury to conclude that such a burdensome program is warranted.

 

 

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Yesterday, we posted about events in the MDL.  Today, the science, and it probably shouldn’t surprise readers of MassTortDefense that studies suggesting a product bears some risk get far more media attention than studies showing a product is safe, even when the latter are more rigorous. Similarly, studies funded by industry are dismissed by the media as hopelessly biased, as if product sellers have no interest in exploring their products, but studies from a pro-plaintiff, pro-litigation, anti-business, pro-regulation, big government biased interest group are deemed “neutral.”

Such continues to be the case with BPA. Consumer Union came out with a report of BPA levels detectable in 19 canned foods. They admitted that the study was limited and that the tests only “convey a snapshot of the marketplace and do not provide a general conclusion about the levels of BPA in any particular brand or type of product tested.”  Levels in the same product purchased at different types or places or in other brands of similar foods might differ from CU test results, they acknowledged. Published reports have noted that the group refuses to release the names of the external laboratories they used for testing; and the "study" would not have been published in a peer-reviewed scientific journal without a detailed description of the analytical methods used. The CU also apparently relies on animal studies in which the animals were injected with BPA, instead of ingesting it. Basic toxicology would indicate that the route of administration is important.

However, BPA has been confirmed as safe for use in food contact materials by the world’s major regulatory agencies. The food contact materials in your supermarket, including epoxy can linings, meet current regulatory standards, and as importantly, actually enhance food safety and extend product shelf life. Thus, BPA-based epoxy coatings in metal packaging provide important and measurable health benefits by reducing the potential for the serious and often deadly effects from food-borne illnesses. This packaging enables the high-temperature sterilization of food products when initially packaged and continuously protects against microbial contaminants. The head-long rush by a few zealots to ban BPA overlooks the need to balance this factor.

The levels CU says it detected are substantially below the advisory level of 600 parts per billion established by the European Union as a level of safe consumption for all ages, and below current U.S. guidelines that establish the daily upper limit of safe exposure as 50 micrograms per kilogram of body weight. They thus do not pose a health risk to consumers, of all ages.

The media gave far less attention to a study released that is a significant development in better understanding the safety of BPA. See Ryan, et al., In Utero and Lactational Exposure to Bisphenol A, in contrast to Ethinyl Estradiol, Does not Alter Sexually Dimorphic Behavior, Puberty, Fertility and Anatomy of Female LE Rats (Toxicological Sciences 2009). The study was sponsored by the Environmental Protection Agency. The study conclusion states: “The lack of effect of BPA on female and male rat offspring after oral exposure to low doses in our studies is consistent with the lack of adverse effects on growth, vaginal opening, fertility and fecundity of low doses of BPA in several other robust, well designed, properly analyzed multigenerational studies (Cagen, et al.,1999; Ema, et al., 2001; Tinwell, et al., 2002; Tyl, et al., 2002).”  This new rodent study thus finds that low-dose exposures to BPA showed no effects on the broad range of reproductive functions and behavioral activities measured. Well-conducted, peer-reviewed studies such as this should provide the basis for reasoned government assessments and regulatory decisions -- not the murky at best, results driven CU report.

 

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In the BPA MDL, Judge Ortrie D. Smith granted in part and denied in part defendants’ motions to dismiss various claims. In re: Bispehnol-A Polycarbonate Plastic Products Liability Litigation, MDL No. 1967 (W.D. Mo.).

Readers of MassTortDefense will recall that last year the Judicial Panel on Multidistrict Litigation centralized fourteen cases; since then, the Panel has continued to transfer cases from around the country, so now about thirty-eight cases have been transferred. In addition, approximately ten cases have been filed in the MDL District and have become part of the consolidation. Defendants roughly fall into two categories: the Bottle Defendants and the Formula Defendants. Generally, the Bottle Defendants make baby bottles, sippy cups and similar products for infants and toddlers, and/or sport bottles. The Formula Defendants sell infant formula packaged in metal cans.

Most of the complaints assert, on behalf of consumers, various causes of action including: (1) violation of state consumer protection laws, (2) breach of express warranty, (3) breach of the implied warranties of merchantability and fitness for a particular purpose, (4) intentional misrepresentation, (5) negligent misrepresentation, and (6) unjust enrichment.

In one Order the court began by addressing the motions to dismiss claims for fraud, misrepresentation and breach of express warranties. The MDL court had previously, mindful of Rule 9, required plaintiffs to identify defendants’ alleged statements that form the basis for their claims of fraud, misrepresentation, and breach of express warranties. Plaintiffs’ continued failure to do so was, said the court, now fatal to these claims. Likely because they were unable to comply, and perhaps because they recognized what compliance would do to their already slim chances for class certification (because of the individual issues that a response would highlight), plaintiffs responded to the aforementioned requirement by saying that they had not identified any advertisements or other media because the allegations are not based on any particular representations. A misrepresentation claim not based on any misrepresentation. Rather, plaintiffs’ allegations are based on defendants’ supposed “overall course of conduct” in marketing and selling the products at issue. Taken as a whole, defendants’ alleged “overall course of conduct” somehow deceptively conveyed the impression or message that the products at issue are safe and healthy for use by infants and children.

By disclaiming reference to any particular fraudulent act, plaintiffs had disclaimed one of the essential elements of a fraud or misrepresentation claim. All states require proof of reliance and causation. For a statement to be relied upon and thus cause a purchaser’s injury, the statement must have been heard by the purchaser. Plaintiffs’ theory – that the placement of a product in a stream of commerce alone somehow conveys a sufficient representation about the product’s safety that can serve as grounds for fraud liability – is a rule that has not been demonstrated to exist in any of the fifty states.

Allowing the mere sale of products to convey an affirmative representation regarding safety would eviscerate the law of warranty and be contrary to the rationale supporting the limited circumstances in which actions constitute representations, noted the court.  Plaintiffs’ failure to identify any expressions made by defendants to them about their products precludes any claim that an express warranty was made, let alone violated. Given the absence of any “affirmation of fact or promise,” (see UCC Article 2-313), plaintiffs cannot allege an express warranty was made. The Supreme Court’s decision in Iqbal requires a plaintiff to identify the basis for, if not the content of, the alleged warranty. And, in a related issue, plaintiffs’ were thus unable to allege how the supposed, non-existent, warranties became “part of the basis of the bargain.”  A representation cannot be part of the “bargain” if the other party to the bargain did not know the representation was made! Merely alleging a representation became part of the bargain does not satisfy Iqbal. If one party (here, the buyer) is not aware of the statement, that party cannot claim the statement became a part of the parties’ bargain.

The court declined to dismiss the claims for fraudulent omissions, based on what it called a “common-sense” view of Rule 9 under which it was unnecessary to require plaintiffs to specifically identify who failed to disclose information and each occasion upon which they failed to disclose it. Rule 9 is satisfied, said the court, with respect to a claim of fraudulent omissions if the omitted information is identified and “how or when” the concealment occurred.

The claim for breach of implied warranty of fitness for a particular purpose was dismissed because while the ordinary purpose for baby bottles can be described as to allow babies and toddlers to drink liquids, a plaintiff cannot rely on this ordinary purpose to support a claim that there was a warranty of fitness for a particular purpose; they must point to some other purpose that is not “ordinary” in order to support their claim.

The court put off ruling on the claims for breach of the implied warranty of merchantability because defendants’ arguments (including lack of privity, untimeliness, and failure to provide notice), seemed premised on the unique characteristics of various states’ laws. Thus, they seemed more amenable to analysis at the time of any class certification decision, which will inevitably raise choice of law issues. A similar deferral was applied to dismissal of all unjust enrichment claims. Many of defendants’ arguments seemed to depend on unique aspects of various states’ laws, found the court.

Defendants also made a strong argument that the claims, at bottom, were improper “no injury” claims. The court agreed as to the category of plaintiffs who disposed of or used up the products before learning about BPA. They received all the benefits they desired and were unaffected by defendants’ alleged concealment. Importantly, the court recognized that while they may contend they would not have purchased the goods had they known more about BPA, these plaintiffs received 100% use (and benefit) from the products and have no quantifiable damages. In this instance, plaintiffs’ position “leads to absurd results.”  These buyers obtained the full anticipated benefit of the bargain. While they may not have paid the asking price, had they allegedly known, offset against this is the fact that they received the full benefits paid for – leaving them with no damages. Plaintiffs here may allege they would not have purchased those products had they supposedly known the true facts, but, again, they obtained full use of those products before learning the truth: the formula was consumed or the children grew to an age where they did not use bottles and sippy cups, so they were discarded. These consumers thus obtained full value from their purchase and have not suffered any damage. These plaintiffs are relegated to the unjust enrichment claim.

The court distinguished, however, those plaintiffs who learned about BPA’s presence and potential effects and either still have the goods or subsequently replaced or disposed of them. Defendants’ argument does not apply to this category, found the court.

That left before the court only plaintiffs’ claims that defendants made fraudulent omissions, violated various state consumer protection statutes, breached the implied warranty of merchantability, and that defendants were unjustly enriched. With these remaining claims pending, the court, in a second order, granted in part defendants’ motion to dismiss on the basis of preemption and denied their motion to dismiss on the ground of primary jurisdiction.

Defendants’ preemption and primary jurisdiction arguments were generally alike in that they both contend their use of BPA should only be subject to regulation by the FDA. Indeed, FDA has issued regulations prescribing the conditions for “safe” use of resinous and polymeric coatings, allowing the coatings to be formulated from “optional substances” that may include “[e]poxy resins” containing BPA. Thus, BPA’s presence in some resinous and polymeric coatings and in polycarbonate resins is subject to regulation by the FDA. It is also a fair reading of FDA’s regulations authorizing BPA’s use that the FDA thinks that food additives containing BPA could be used safely without labeling requirements.

The doctrine of primary jurisdiction applies when enforcement of a claim that is originally cognizable in the courts requires the resolution of issues which, under a regulatory scheme, have been placed within the special competence of an administrative body. The FDA clearly has specialized expertise and experience to determine whether BPA is “safe.” However, said the court, the ultimate issues in these cases, as alleged by plaintiffs, are whether defendants failed to disclose material facts to plaintiffs and thus, for example, whether defendants breached the implied warranty of merchantability through the sale of products containing BPA. FDA’s decision that BPA is “safe” is not determinative of any of those issues, said the court. This conclusion seemed to give insufficient attention, in our view, to the argument that plaintiffs have predicated their claims on proof that BPA is allegedly unsafe: the undisclosed facts are not material unless BPA is not safe. The products are not unmerchantable unless BPA is unsafe, Since plaintiffs base their claims on such evidence, the claims seemed to fall within the primary jurisdiction of the FDA.  The MDL court did not agree.

Turning to the preemption issue, the court first rejected the claim of implied preemption. While noting that FDA has approved BPA use in food additives and noting the agency’s decision not to require labeling, the court concluded that the FDA’s approval of BPA as safe without labeling requirements establishes only a regulatory minimum; nothing in these regulations either required or prohibited defendants from providing the disclosures sought. The court cited Wyeth v. Levine for the proposition that that there is no preemption when federal law did not prevent the drug manufacturer from strengthening its drug label as necessary to comply with the standard to be imposed by state law.

However, the Formula Defendants also raised express preemption; they asserted that the FDA regulations exempt Formula Defendants from having to disclose the presence of BPA in their products. Express preemption exists when a federal law explicitly prohibits state regulation in a particular field. With respect to food labeling, federal law generally prohibits states from establishing any differing requirements for the labeling of food. Thus, plaintiffs’ claims are expressly preempted because they would impose disclosure requirements concerning BPA, the exact opposite of the exemption. Now, here is the interesting twist: plaintiffs asserted that Congress also provided an exception to express preemption under the law for “any requirement respecting a statement in the labeling of food that provides for a warning concerning the safety of the food or component of the food.”  But, the court noted, plaintiffs cannot have it both ways.  If their claims are based on warnings about the safety of food, then their claims would have been subject to dismissal under the primary jurisdiction doctrine because the determination whether BPA is “safe” is solely the province of the FDA, and the FDA has concluded that the use of BPA in epoxy liners is “safe” so long as the manufacturer abides by the FDA’s prescribed conditions. See 21 C.F.R. § 175.300 (2009).  If the claims against the Formula Defendants are not subject to primary jurisdiction, as plaintiffs argued, then they are subject to express preemption analysis.

It may seem clear to readers of MassTortDefense that even with respect to those claims the court concluded should not be dismissed on the pleadings, the court's analysis highlights several issues that may make it difficult for the plaintiffs to proceed as a viable class action. 

 

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A while back we posted about an interesting toxic tort case involving important causation issues. See Zandi v. Wyeth, 2009 WL 2151141 (Minn.App.).  A Minnesota appeals court recently refused to rehear its prior affirmance of summary judgment for defendants in a suit by a woman who alleged hormone replacement drugs caused her breast cancer.  2009 Minn. LEXIS 648. 

Plaintiff alleged that between approximately 1981 and 2001, she ingested hormone replacement therapy (HRT) drugs manufactured, designed, packaged, marketed, and distributed by defendants. In November 2001, Zandi alleges she was diagnosed with "hormone-dependent breast cancer." She contended that the HRT drugs caused her cancer. 

The trial court found that plaintiff's specific causation evidence did not satisfy Minnesota's standard for admissibility of expert testimony. Zandi offered testimony from Dr. Lester Layfield and Dr. Gail Bender to try to prove that HRT drugs caused her cancer. Minnesota courts use the Frye standard to determine the admissibility of novel scientific evidence. Zandi's claims were based on the following propositions: 1) it is supposedly generally accepted that HRT causes hormone-dependent breast cancer, and 2) there is a generally accepted method of diagnosing the cause of hormone-dependent breast cancer in an individual. The appellate issues revolved around the second.

Plaintiff's experts based their specific causation opinions in part on "differential diagnosis."  As readers of MassTortDefense know,  differential diagnosis, sometimes called “differential etiology”  is a process through which all the scientifically plausible causes of an injury are “ruled in,” and the expert then “rules out” the less plausible causes until reaching the one that theoretically cannot be ruled out.  If you've watched "House" on TV, you have seen the use of differential diagnosis to discover what disease a patient is suffering from.  Less traditional, and more questionable, is the use of the technique to discover what is the cause of the disease in the patient.  Most doctors don't care as much about the cause of the disease as getting the right disease and treating it.  As used by toxic tort plaintiffs, differential diagnosis adopts a process of elimination to identify not just the injury (which may be debated) but also the cause; in theory, it seeks to eliminate the possibility of competing causes or confounding factors. 

Again, in performing a differential diagnosis, a physician begins by ruling in all scientifically plausible causes of the patient's injury. The physician then rules out the least plausible causes of injury until the most likely cause remains. Yet, breast cancer does not lend itself to such a differential diagnosis because the scientific community has not accepted that breast cancer has a limited number of discrete and recognized possible causes such that ruling out one or a few causes would necessarily implicate another. For differential diagnosis to be sufficiently reliable to even come close to proving causation, even assuming one accepts the method in this context, the diagnostician should rule out all other hypotheses, or at least explain why the other conceivable causes are excludable. But additional risk factors that plaintiff failed to adequately account for here in this case included family history. When faced with this dilemma, as is common when a disease has many idiopathic cases, plaintiff's experts simply suggest that it is possible to conduct a reliable differential diagnosis without ruling out other hypotheses, as long as "major" or "most" explanations are ruled out.  Courts should be wary of this.

Courts generally recognize that the proffered expert must have a sufficient basis to “rule in” the drug or toxic substance at issue as a plausible cause of plaintiff’s injury. E.g., Jazairi v. Royal Oaks Apts., 217 Fed. Appx. 895 (8th Cir. 2007).  But this case is a good reminder that the plaintiff's expert testimony must also reliably “rule out” the other plausible causes of the injury--  again, especially difficult when its causes are largely unknown.  On this record, the court said, “We conclude that there is not a method of diagnosing the specific cause of a particular woman's breast cancer that is generally accepted in the relevant scientific community. This reality leaves Zandi without a legally sufficient ability to prove specific causation.”  See also Perry v. Novartis, 564 F. Supp.2d 452 (E.D. Pa. 2008).

This clear reasoning can be contrasted with the inexplicable finding of the 8th Circuit in Scroggin v. Wyeth, 2009 WL 3518245 (8th Cir. Nov. 2, 2009), which accepted plaintiff's carefully constructed circular reasoning.  Unable to prove that the breast cancer was caused by hormone therapy drugs, plaintiff's expert simply re-diagnosed the disease as hormone-induced breast cancer.  This allowed the expert to engage in a so-called differential diagnosis to determine the cause of the breast cancer simply by ruling out the two possible sources of these hormones: (1) plaintiff produced the hormones herself, or (2) they came from the hormone replacement therapy she had allegedly taken for the past eleven years.  Under this circular reasoning, any form of cancer can easily be linked to the defendant's product because it will be re-characterized as the sub-type of disease caused by the substance at issue. 
 

 

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In the Chinese Drywall  MDL, certain plaintiffs recently moved for leave to amend their Class Action Complaint to expand the class definition as to defendant Taishan Gypsum, from a Virginia state-wide class to a national class of all persons allegedly impacted by defective drywall made by that defendant. Plaintiffs assert that there will be no undue delay nor prejudice to defendants from the change; the amendment does not alter the proposed sub-classes as to other defendants who are the builders and installation contractors who allegedly installed the product. The amendment would also include new assertion of a violation of the consumer fraud acts of the various states. In re: Chinese-Manufactured Drywall Products Liability Litigation, No. 09-md-02047 (E.D. La.).

An Omnibus [Proposed] Class Action Complaint is to be filed in the MDL on or before December 9, 2009 by the plaintiffs against another defendant, Knauf Plasterboard (Tianjin) Co., Ltd (“KPT”) and other defendants who were involved in the manufacture, sale, importation, brokerage, distribution, construction and installation of homes containing KPT drywall, and any others who were involved in the stream of commerce for the KPT drywall. In order to assist in the consolidation and efficient handling of claims by affected homeowners, defendant KPT has apparently agreed to accept service of process for homeowner plaintiffs who are to be named in an Omnibus Amended Complaint, and waive its right to demand service of process through the Hague Convention. (We have posted about the issues related to suits against foreign defendants before.) However, to be eligible for inclusion in this Omnibus [Proposed] Class Action Complaint and the service waiver, homeowners must provide, by no later than December 2, 2009, sufficient indicia that the homes in question contain KPT drywall (e.g., photographs, samples, visual inspections or reports identifying KPT markings on drywall in the home), and must also submit by December 14, 2009, a fully completed and executed Plaintiff Profile Form, in accordance with PTO #11. The complaint will not be amended to include additional named plaintiffs after it is filed, the court has indicated.

 

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The federal inter-agency task force investigating alleged problems with Chinese-made drywall released initial results of three studies last week, which may impact the MDL litigation. The CPSC, the EPA, HUD, the CDC, and the Agency for Toxic Substance and Disease Registry are members of the task force. Health departments in Florida, Louisiana, and Virginia have also participated in the task force. An executive summary of the studies, and the draft studies themselves are available here.

To date, close to 2000 consumers have contacted the CPSC to report alleged problems in their homes. The primary issues reported are: 1) corrosion, or blackening, of indoor metals, such as electrical components and central air conditioning system evaporator coils; and 2) various health symptoms, including persistent cough, bloody and runny noses, headaches, difficulty in breathing and irritated and itchy eyes and skin. Imported drywall from China came into more widespread use after hurricanes in 2004 and 2005 led to a surge in home reconstruction and caused shortages of North American-made drywall.

In sum, the three studies involved:
(1) Elemental and Chemical Testing: The study of the elemental and chemical composition of drywall samples showed higher concentrations of elemental sulfur and strontium in Chinese drywall than in non-Chinese drywall. The elemental and chemical testing of Chinese and non-Chinese drywall samples was undertaken to characterize the specific chemical composition of the drywall. The results were expected to identify differences between the two sets of drywall that might account for the reported corrosion and health issues. While the studies have discovered certain differences between Chinese and non-Chinese drywall, further studies must be completed, said the report, to determine any nexus between the drywall and the reported health and corrosion issues. The analysis was conducted on 17 samples of drywall collected from warehouses, suppliers and manufacturers. These samples were unpainted and uninstalled.

(2) Chamber Studies: Preliminary results of ongoing testing to detect gases emitted from drywall in laboratory chambers showed higher emissions of total volatile sulfur gases from Chinese than from non-Chinese drywall. The chamber studies, conducted by Lawrence Berkeley National Laboratory, were intended to isolate the chemicals emitted from drywall. From these chamber studies, said the task force, it was possible to isolate the drywall emissions from the interferences of other materials or furnishings in a house that might emit or absorb such emissions. No comprehensive exposure and risk assessment has yet been carried out.

(3) Indoor Air Studies: Indoor air testing of 10 homes in Florida and Louisiana was conducted to identify and measure contaminants and to inform a drywall home indoor air testing protocol. The tests did not detect the presence or found only very limited or occasional indications of sulfur compounds of particular interest to the task force – hydrogen sulfide, carbon disulfide, and carbonyl sulfide. Concentrations of two known irritant compounds, acetaldehyde and
formaldehyde, were detected at concentrations that could exacerbate conditions such as asthma in sensitive populations, but were found in both homes with and without Chinese drywall. The levels of formaldehyde were not unusual for new homes, however, said the report. The results of the air testing in this very small sample of homes was being reported to offer a very preliminary indication of what compounds may be present in the indoor environments of homes in Florida and Louisiana with and without Chinese drywall.

The agencies expect the results of an air-sampling study of 50 homes in late November. An engineering analysis of electrical and fire safety issues is also forthcoming. .A study of long-term corrosion issues, that seeks to simulate decades of exposure and corrosion, will not be completed until June of 2010.

The study follows in the wake of the four-day U.S.-China summit that aimed to reinforce the notion that the United States—specifically the CPSC—will hold accountable importers of products into the United States if their products pose hazards or violate safety standards. The CPSC delegation reportedly discussed drywall safety concerns with Chinese government officials.

The CPSC stressed that this report was preliminary; the findings of each report released today must be considered within the limitations of each study and viewed in the context of the overall drywall investigation, which is still ongoing. While the studies have discovered certain differences between Chinese and non-Chinese drywall, further studies must be completed to determine any nexus between the drywall and the reported health and corrosion issues.
 

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A federal court has ruled that a $97million judgment issued against Dole Food Co. and Dow Chemical in a Nicaraguan court cannot be enforced in the U.S. courts.  See Osorio v. Dole Food Co., No. 1:07-22693 (S.D. Fla.).

Plaintiffs in this case had alleged that 150 banana farmers had suffered a number of injuries because of exposure to pesticides. Specifically,the workers on Dole’s banana plantations in Nicaragua between 1970 and 1982 claimed they were harmed by their exposure to the chemical compound dibromochloropropane (DBCP) which has been linked to sterility, according to plaintiffs. The Nicaraguan Legislature enacted a statute in 2000 specifically to handle DBCP claims there.  More than 10,000 plaintiffs have filed approximately 200 DBCP lawsuits in Nicaragua, most of which are still pending. Already, however, Nicaraguan courts have handed down over $2 billion in judgments to these plaintiffs. A few Nicaraguan plaintiffs have brought DBCP suits in the United States, with the California state courts, for example, concluding that the DBCP claims before it were the direct result of a widespread conspiracy to commit fraud by attorneys in Nicaragua, Nicaraguan doctors and judges (including the Nicaraguan trial judge who issued the judgment in this case), and some of the plaintiffs themselves.

Here, pursuant to this new law, the trial court awarded $97.4 million to compensate the plaintiffs for the alleged DBCP-induced infertility and psychological effects, about $647,000 per plaintiff.

The U.S. District Court for the Southern District of Florida held that defendants had “clearly established” their entitlement to nonrecognition of the award.  States are not required to recognize judgments rendered in foreign countries under the Full Faith and Credit Clause of the Constitution of the United States. U.S. CONST. art. IV, § 1; Guinness PLC v. Ward, 955 F.2d 875, 883 (4th Cir. 1992). In the absence of a treaty, the effect given to a foreign judgment has historically been governed by the more flexible doctrine of comity, which, though often couched in the language of mutual respect and obligation, is most accurately described as a matter of grace. See, e.g., Hilton v. Guyot, 159 U.S. 113, 166 (1895).

Here, the district court found: (1) the Nicaraguan trial court lacked personal and/or subject matter jurisdiction under the Special Law 364; (2) the judgment was rendered under a system which does not provide procedures compatible with due process of law; (3) enforcing the judgment would violate Florida public policy; and (4) the judgment was rendered under a judicial system that lacks impartial tribunals.

A few highlights: the federal court noted that the Nicaraguan attorney general had found that this Special Law violates the country’s constitution because, among other things, it assumed that the plaintiffs will automatically prevail and does not even contemplate the possibility that DBCP defendants might succeed in defeating the plaintiffs’ claims.  While the Nicaraguan Supreme Court later upheld the law, it is clear that absent the presumption of causation, there was no evidence before the Nicaraguan trial court sufficient to determine that DBCP exposure caused the plaintiffs’ injuries.  And the irrefutable presumption of causation resulted in findings that were incompatible with medical and scientific facts. The majority of the plaintiffs were awarded damages even though they allegedly suffered exclusively from conditions not scientifically linked to DBCP exposure. About one-fifth of the prevailing plaintiffs had fathered children in the years since their last alleged exposure to the chemical -- undercutting the infertility claim in a somewhat conclusive way.

In every year from 1999 through 2008, the Country Reports prepared by the State Department have concluded that Nicaragua lacks an effective civil law system.  In 2002, the year this case was filed in Nicaragua, the State Department found that  “Judges’ political sympathies, acceptance of bribes, or influence from political leaders reportedly often influenced judicial actions and findings."   The Special Law was upheld as constitutional by the Nicaraguan Supreme Court because it allowed a defendant to opt-out of jurisdiction there if the defendant agreed to jurisdiction in the U.S.  Here, the defendants consented to jurisdiction in the United States and waived their defenses under the forum non conveniens doctrine. Their initial pleadings contested the foreign trial court’s jurisdiction and attempted to exercise their opt-out rights.  Yet, in December 2004, 14 months after the Nicaraguan Supreme Court issued its opinion clarifying that Special Law 364 was constitutional because it permitted defendants to opt out of Nicaragua’s jurisdiction, the trial court denied Dole and Dow’s jurisdictional challenges.

In sum, Special Law 364 contained numerous unique provisions that apply only to a narrow class of defendants, and operate to their distinct disadvantage in a pronounced discriminatory fashion. The court also found that Special Law 364’s disparate treatment of defendants is fatally unfair and discriminatory, fails to provide the minimum level of due process to which all foreign defendants are entitled, and is, therefore, incompatible with the requirements of due process under Florida law.

 

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Part two of our update on recent climate change litigation.  In our last post, we discussed the well reasoned decision in Native Village of Kivalina v. ExxonMobil Corp., 2009 WL 3326113 (N.D.Cal. 9/30/09).  We contrasted it with the somewhat startling (2-judge) Second Circuit panel decision in Connecticut v. American Electric Power Co., allowing a group of states and land trusts to proceed with a so-called global warming tort suit.

In another noteworthy recent case, the Fifth Circuit recently held that a group of property owners in Mississippi can proceed with global warming-related claims. See Comer v. Murphy Oil Co., 2009 WL 3321493 (5th Cir. 10/16/09).  A proposed class of thousands of property owners alleged that damage to their Mississippi coastal properties from Hurricane Katrina would not have been as serious had not defendants' climate change conduct intensified the storm. Along with the Second Circuit decision, this opinion represents a clear and dangerous trend within the court of appeals to usurp Congress, warp the traditional nuisance doctrine, and plunge the federal courts into what are essentially political questions.

In Comer, the district court correctly held that tort suits against electric power companies and other alleged large greenhouse gas emitters should not proceed in federal court because climate change, and tort claims based on alleged climate change, is fraught with national political and policy considerations.  The Fifth Circuit reversed, asserting that until Congress, the executive branch, or a federal agency acts more directly on global warming, Mississippi common law tort rules questions posed by the case are justiciable because there is no commitment of those issues exclusively to the political branches of the federal government.  Thus, plaintiffs had demonstrated standing for public and private nuisance, trespass, and negligence claims; the claims were justiciable and did not present a political question. 

The Fifth Circuit in some ways went  further than the Second Circuit, ruling in essence that climate change-related claims are not limited to injunctions being brought by governmental entities or even quasi-public groups like nonprofit land trusts. The Fifth Circuit ruled that private property owners under Mississippi law also may have standing to bring climate change-related nuisance and trespass claims for both property and punitive damages. That holding may propel additional climate change litigation -- if the ruling stands following likely rehearing motions.

The causation allegation here was arguably even more attenuated than the long, convoluted causation chain in other global warming cases; plaintiffs asserted that defendants' greenhouse gases didn't cause but contributed to global warming, which made the waters in the Gulf of Mexico warmer, which didn't create but then made Hurricane Katrina more intense, which then caused their alleged property damage to be worse.  That stands as perhaps the most attenuated, least supportable, causal link in tort history -- the absence of proximate cause as a matter of law.  The concurrence noted this issue, and would have affirmed a dismissal on this basis.  With class certification, expert discovery, Daubert, and summary judgment hurdles to be crossed, it is clear that this causation issue will not soon disappear.

Ironically, the rash of global warming opinions in cases that had been argued long ago may reflect a recognition of the new administration and a changing emissions policy... in turn, reflecting the political nature of the issues. All readers ought to have profound reservations about the notion, inherent in all private climate change litigation, that the tort system is capable of adjudicating rights and responsibilities on the subject of global warming.

The decisions potentially present business interests with difficult choices: proposed regulations from the administration may be onerous and not grounded in good science; but absent federal action, defendants may risk public nuisance liability in the courts on issues that juries cannot begin to handle well.  

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Today, the first of a couple of posts on the so-called global warming litigation.  We have posted on the climate change litigation before, and here, and we note first that a  federal trial court recently dismissed a global climate change suit filed by Inupiat Eskimos from Kivalina, Alaska against dozens of oil and energy companies. Native Village of Kivalina v. ExxonMobil Corp., 2009 WL 3326113 (N.D.Cal. 9/30/09).

The suit was brought by the village of about 400 people, who alleged that as a result of global warming, the Arctic sea ice that protects the Kivalina coast from storms has been diminished, and that resulting erosion will require relocation of the residents to another village.  (The town of Kivalina is located at the tip of a six-mile-long barrier reef, about 70 miles north of the Arctic Circle on Alaska's northwest coast.) Plaintiffs sought damages under federal common law nuisance, state nuisance, and civil conspiracy theories. They alleged that defendants were a major part of the cause of excessive emissions of carbon dioxide and other greenhouse gases, which plaintiffs claimed are causing global warming.

The defendants properly noted that many of the questions raised by the plaintiffs in this suit were inherently political; there are no traditional judicial standards available to adjudicate such political issues. They also argued that plaintiffs lacked standing under Article III because the injury to the plaintiffs was not “fairly traceable” to the conduct of the defendants. 

Judge Saundra Brown Armstrong of the U.S. District Court for the Northern District of California agreed, finding global warming to be a political issue not appropriate for a federal court to decide. The courts have long indicated that disputes involving political questions lie outside of the Article III jurisdiction of federal courts.  Corrie v. Caterpillar, Inc., 503 F.3d 974, 980 (9th Cir.2007). The political question doctrine serves to prevent the federal courts from intruding unduly on certain policy choices and value judgments that are constitutionally committed to Congress or the executive branch.  Koohi v. United States, 976 F.2d 1328, 1331 (9th Cir.1992).  A non-justiciable political question exists when, to resolve a dispute, the court must make a policy judgment of a legislative nature, rather than resolving the dispute through legal and factual analysis. Courts typically look at three broad factors: (i) Does the issue involve resolution of questions committed by the text of the Constitution to a coordinate branch of Government? (ii) Would resolution of the question demand that a court move beyond areas of judicial expertise? (iii) Do prudential considerations counsel against judicial intervention?

Under the second factor, which was key here, the court concluded that a factfinder would have to weigh, inter alia, the energy-producing alternatives that were available in the past and consider their respective impact on far ranging issues such as their reliability as an energy source, safety considerations and the impact of the different alternatives on consumers and business at every level. The factfinder would then have to weigh the benefits derived from those choices against the risk that increasing greenhouse gases would in turn increase the risk of causing flooding along the coast of a remote Alaskan locale. Plaintiffs ignored this aspect of their claim and otherwise failed to articulate any particular judicially discoverable and manageable standards that would guide a factfinder in rendering a decision that is principled, rational, and based upon reasoned distinctions.

Secondly, plaintiffs conceded they were unable to trace their alleged injuries to any particular defendant.  While they sought to rely on, by analogy, injury concepts under the Clean Water Act, the court concluded that even if the theory were applicable outside the context of a statutory water pollution claim, it is simply inapposite where, as here, plaintiffs have not alleged that even the “seed” of their injury can be traced to any of the defendants. Plaintiffs acknowledged that the genesis of the global warming phenomenon dates back centuries and is a result of the emission of greenhouse gases by a multitude of sources other than the defendants. The complaint further alleges that the level of atmospheric carbon dioxide -- “the most significant greenhouse gas emitted by human activity” -- has been increasing steadily “since the dawn of the industrial revolution in the 18th century, and more than one-third of the increase has occurred since 1980.”  Significantly, the source of the greenhouse gases are undifferentiated and cannot be traced to any particular source, let alone a defendant, given that they rapidly mix in the atmosphere. 

The court thus dismissed the suit for lack of subject matter jurisdiction, both because of the political question, and because the plaintiffs could not prove the companies caused the alleged injury.

The decision is consistent with most prior decisions coming out of the district courts, which generally have viewed these climate change cases as raising fundamentally political judgments.  The decision is a more coherent analysis than the recent, ostensibly conflicting, ruling of the Second Circuit allowing plaintiffs to sue over climate change under federal common law, in Connecticut v. American Electric Power Co., No. 05-5104-cv (2d Cir. 9/21/09).  (It also will be contrasted in our next post with the Fifth Circuit's recent ruling in Comer v. Murphy Oil Co.

The Second Circuit case involved a suit by states and environmental groups against various electric power companies; these plaintiffs made allegations similar to those in the Alaska case, and that defendants were thus harming the environment, the states' economies, and public health.  The appeals court overturned a well-reasoned trial court ruling that the case represented a non-justiciable political question.  

Unlike the Second Circuit, the California district court recognized major distinctions between ordinary pollution cases and planet-wide climate change allegations;  the court was wisely unwilling to confront -- and could not ignore the existence of -- the myriad legal and policy issues relating to imposing liability on a planetary scale. Judge Armstrong disagreed with the appeals court conclusion that traditional water pollution and air pollution nuisance cases provide appropriate guidance in assessing global warming "nuisance" cases.  While a water pollution claim typically involves a discrete, geographically definable waterway, plaintiffs’ global warming claim is based on the emission of greenhouse gases over decades from innumerable sources located throughout the world and supposedly affecting the entire planet.

Fundamentally, such a nuisance claim would require the judiciary to make a policy decision about who should bear the cost of global warming, if it turns out to be a real climatic phenomenon. Though alleging that defendants are responsible for a "substantial portion" of greenhouse gas emissions, plaintiffs also acknowledge in these cases that virtually everyone on Earth is responsible at some level for contributing to such emissions (even you readers). Thus, plaintiffs are in effect asking the courts to make a political judgment that the two dozen defendants named in this action should be the only ones to bear the cost of contributing to global warming.  The Second Circuit, in contrast, in American Electric, tried to draw a highly dubious distinction between a claim seeking a comprehensive solution to global climate change, a task that arguably falls within the purview of the political branches, and a claim "merely" to limit emissions that allegedly constitute a public nuisance -- because the emissions (part of the highly controversial political debate about global warming) are greenhouse gasses and the source of alleged climate change caused by human activity.    

 

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On the eve of the 3rd biennial United States--China Consumer Product Safety Summit, to be held in China, the head of the Consumer Product Safety Commission reported she will press Chinese officials on whether new regulatory standards need to be set for drywall composition. CPSC Chairwoman Inez Tenenbaum said she also would inquire whether the Chinese were willing to provide compensation for the damage from tainted drywall.

In its latest status report on the Chinese drywall issues, the CPSC noted that it had received 1192 consumer complaints, from 24 different states. The majority of the reports continue to be from Florida, Louisiana, and Virginia. The focus of the federal drywall team has remained pursuing the scientific bases of the possible problems, and tracing the chain of commerce of the drywall.

CPSC reports it has completed principal field work for a 50 home indoor air sampling program, coordinated the state and federal response to allegations of radioactive phosphogypsum in Chinese drywall, and completed 75 in-depth site investigations, with another 20 in progress. Long-term air sampling tests will be completed later this month. The evaluation of the results is expected to be complete before November. (Phosphogypsum is a gypsum that has elevated levels of naturally occurring potassium, thorium and uranium radionuclides and decay products.) The CPSC coordinated testing and reporting results for radioactive phosphogypsum contamination in drywall with the Florida Department of Health and the EPA National Air and Radiation Environmental Laboratory. The results of the technical review showed that no radiological hazard was present. EPA is conducting elemental analyses of 15 drywall samples. EPA expects to complete its analyses of drywall samples in the next few weeks.

CPSC continues to analyze the information received from consumers, builders, importers, manufacturers, and suppliers of drywall to determine how much imported drywall may be affected and where that drywall has been installed. To date, CPSC staff has confirmed that during 2006, 6,997,456 sheets of Chinese drywall were imported into the U.S.

As readers of MassTortDefense know, litigation has been filed over the drywall issues, alleging that sulfur levels in the Chinese-made products are abnormally high, causing problems with air conditioning systems, appliances, internal wiring and other electrical systems.  Approximately 200 cases are pending in the MDL. In re: Chinese-Manufactured Drywall Products Liability Litigation, No. 09-md-02047 (E.D. La.).

In the MDL , the next status conference is scheduled for Thursday, November 19, 2009. Recently, the court  issued an order regarding a "Revised Exporter, Importer, or Broker Defendant Profile Form.”  All defendant drywall exporters, importers, or brokers must complete this Profile Form.  The form, inter alia, requires information on exemplar transactions concerning the exportation/importation/brokering of Chinese Drywall for import/export to the United States between 2001 and 2009, including but not limited to purchases, sales, consignments, shipments, transfers, deliveries, receipts, or other distributions.  The form requires information to identify any markings on the Chinese Drywall product (e.g., lot number, batch number, serial number, color markings, UPC codes, etc.) involved in this transaction; a list all trademarks of the product, and any markings or means of identification employed to track or identify the Chinese Drywall.

The issue of linking the specific product that allegedly harmed a plaintiff to the defendants who made and sold that particular product -- often termed "product identification" -- is an essential aspect of the cause in fact inquiry and is often problematic in toxic tort litigation.

 

 

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The Sixth Circuit has approved a class action settlement in an interesting toxic tort case. Moulton v. U.S. Steel Corp., 2009 WL 2997921 (6th Cir., 9/22/09).

This class action was filed in 2004 by neighbors of a steel mill operated by defendant U.S. Steel, and alleged various claims arising from “metal-like dust and flakes” allegedly falling on plaintiffs' property. The district court in Michigan certified the class in 2006, and the parties eventually agreed on a settlement for $4.45 million in 2008.

As is not unheard of, some class members and at least one plaintiffs' lawyer objected to the settlement. They argued that the settlement agreement was not “fair, reasonable, and adequate” under Fed.R.Civ.P. 23(e)(2).  Specifically, they argued (1) that the agreement dis-serves the “public interest” due to the broad scope of the release, (2) that alleged “collusion” between Class Counsel and U.S. Steel tarnished the agreement and (3) that the agreement improperly prioritizes the distribution of the settlement proceeds. The district court rejected all such objections, and the court of appeals reviewed the district court's conclusions for abuse of discretion.

To determine whether a settlement agreement satisfies Rule 23's fairness standard,  courts consider:  (1) the risk of fraud or collusion;  (2) the complexity, expense and likely duration of the litigation;  (3) the amount of discovery engaged in by the parties;  (4) the likelihood of success on the merits;  (5) the opinions of class counsel and class representatives;  (6) the reaction of absent class members; and (7) the public interest. UAW v. Gen. Motors Corp., 497 F.3d 615, 631 (6th Cir.2007). 

On the issue of the scope of the release, the release of the continuing nuisance claims was held not unfair, because, contrary to the objections, it did not go“well beyond the claims plead in the complaint."  Since 2005, every version of the plaintiffs' complaint included a claim for “continuing private nuisance.”  As class members, the objectors are the last individuals in a position to claim lack of notice that this claim was on the table at the settlement talks. And the bar on future continuing nuisance claims applies only to claims arising out of conditions that existed prior to the settlement. It does not preclude future continuing nuisance claims based on emissions from new equipment installed after the date of settlement. Nor does it bar future claims based on old equipment, so long as the continuing nuisance is a “new” one.

Neither did the objectors make the case that the agreement was a product of collusion. See Williams v. Vukovich, 720 F.2d 909, 921 (6th Cir.1983). The duration and complexity of the litigation undermined the objectors' suspicions. The parties litigated for almost four years before reaching a settlement agreement. The court fielded numerous contested pretrial motions. Class Counsel pursued multiple avenues to gather evidence; and the agreement itself was a product of months of supervised negotiations, two facilitated mediations and a settlement conference with the court.

Third, there was the challenge to the $4.45 million settlement, which the agreement distributed as follows: $300 to each covered member of the class, limited to one award per household; $10,000 to the seven class representatives; and $1.335 million in attorney's fees (30%) and $622,279.86 in costs to class counsel. Any residual goes to local public schools. Because class counsel received 4,026 class-member claims, roughly $1.21 million will go to the claimants and roughly $1.28 million will go to the schools. The appeals court noted that the district court should have been more expansive in its explanation of the approval of the award as reasonable.  However, that claimants will in the aggregate receive less than Class Counsel does not automatically invalidate the agreement. That the public schools will receive $1.28 million in unclaimed funds does not reflect on the settlement's fairness.

Finally, a plaintiffs' lawyer purporting to represent multiple class members insisted that the court improperly shut him out of the case. In what the appeals court called a “sideshow” to the main case, the attorney reportedly contacted an unknown number of class members after the class certification advising them to opt out because those who opt out “always get a much higher settlement than … the general population.”  The 6th Circuit found that the district court also did not err by corralling the extent of this counsel's involvement in the case. Rule 23 gives the district court broad discretion in handling class actions, authorizing orders that impose conditions on the representative parties or on intervenors. Fed.R.Civ.P. 23(d)(1)(C).  In view of the questionable communications with litigants, unannounced solicitation of opt outs, and apparent guarantee to individuals who opted out, the district court appropriately exercised its discretion, said the Circuit.

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Many readers of MassTortDefense have wondered about the potential future litigation risks associated with nanotechnology. The U.S. Environmental Protection Agency has just finalized its new strategy to guide its research into how nanomaterials, used in a growing number of consumer products, might be studied for potential effects on human health and the environment. The Nanomaterial Research Strategy (NRS) describes the EPA's strategy for conducting and supporting research to understand the potential human health and ecological implications from exposure to manufactured nanomaterials, and how nanotechnology can be used sustainably in environmental protection applications.

EPA has written this document with three stated purposes:
(1) to guide its own researchers and managers as they conduct EPA’s research program,

(2) to assist scientists in other organizations and agencies as they plan research programs, and

(3) to inform the public of how EPA intends to generate scientific information to guide environmental decisions related to nanomaterials.

With the use of nanotechnology in the consumer and industrial sectors expected to increase
significantly in the future, nanotechnology offers society the promise of major benefits. The challenge for environmental protection is to ensure that, as nanomaterials are developed and used, unintended consequences of exposures to humans and ecosystems are prevented or minimized. In addition, knowledge concerning how to sustainably apply nanotechnology to detect, monitor, prevent, control, and clean up pollution is needed, says the NRS.

The strategy builds on the work of the Nanotechnology Environmental and Health Implications
Working Group (NSTC, 2008), and in the EPA’s Nanotechnology White Paper (EPA, 2007).

EPA’s strategy focuses on four areas:

􀂃 Identifying sources, fate, transport, and exposure
􀂃 Understanding human health and ecological effects to inform risk assessments and test methods
􀂃 Developing risk assessment approaches
􀂃 Preventing and mitigating risks
 

The key science questions described in the strategy document are intended to help decision makers answer the following questions:
􀂃 What nanomaterials, in what forms, are most likely to result in environmental exposure?
􀂃 What particular nanomaterial properties may raise toxicity concerns?
􀂃 Are nanomaterials with these properties likely to be present in environmental media or biological
systems at concentrations of concern, and what does this mean for risk?
􀂃 If we think that the answer to the previous question is “yes,” can we change properties or mitigate
exposure?

Readers of MassTortDefense know that nanotechnology is the process of manipulating materials 1 million times smaller than a millimeter. Nanomaterials, lighter and stronger than other materials, are used in hundreds of products already on the market, including many cosmetics and skin care products.  We have posted on this topic before.  Materials can take on new properties at the nano level, becoming stronger, better conductors of heat or electricity, for example.

The EPA's own office of research development is focusing its research on seven manufactured nanomaterial types: single-walled carbon nanotubes, multiwalled carbon nanotubes, fullerenes, cerium oxide, sliver, titanium dioxide and zero-valent iron. Carbon nanotubes are used in vehicles, sports equipment and electronics, while titanium dioxide is used in paints, cosmetics and sunscreens, as reported by EPA.  The Agency is also part of the government-wide National Nanotechnology Initiative.

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Last week a federal jury in Louisiana returned a defense verdict in a plaintiffs' suit over alleged exposure to formaldehyde fumes while living for several months in a FEMA-provided trailer. In Re: FEMA Trailer Formaldehyde Products Liability Litigation, Age v. Gulf Stream Coach Inc., No. 09-02892, E.D. La.). The government had made the trailer available after Hurricane Katrina destroyed the plaintiffs' home in 2005.

Plaintiffs sued manufacturer Gulf Stream Coach Inc. and installer Fluor Enterprises Inc., alleging that elevated levels of formaldehyde aggravated family members' asthma and increased their risk for getting cancer.  (FEMA was dismissed as a defendant in the lawsuit because of the two-year statute of limitations in cases brought against the federal government.)  They argued that Gulf Stream Coach, in expediting production of the housing units following Hurricanes Katrina and Rita, used substandard materials and/or unsafe practices during the manufacturing process, which allegedly resulted in the temporary housing units containing higher than normal levels of formaldehyde. Plaintiffs alleged that Fluor's installation methods contributed to greater formaldehyde exposure.  They further charged that the FEMA trailer deviated from government safety specifications and that Gulf Stream failed to warn the government about the dangers of formaldehyde, which is found in construction materials as well as in glues and adhesives used in the manufacture of the units.

The claim is one of many hundreds of suits filed that are now part of the MDL, and one of the first five bellwether cases selected for trial. Readers of MassTortDefense will recall how Hurricane Katrina devastated much of the Gulf Coast in 2005. The total damage of Hurricane Katrina has been estimated at $75 billion, while not-much-later Hurricane Rita caused $10 billion in damage. The government, through FEMA, moved individuals whose homes were lost or deemed uninhabitable into makeshift housing provided by the agency. Plaintiffs generally allege that the trailers had components that exposed them to dangerous and excessive levels of formaldehyde.

The defense here presented alternative causation evidence on the alleged respiratory issues, and noted that formaldehyde is found in safe levels in many products, including cosmetics, foods and shampoo. The defendants sold this trailer to the most sophisticated purchaser in the world, the United States government, argued the defense, and there is no duty to warn someone about something they know about already. The defense argued that Gulf Stream wasn't obligated to build a "perfect product."

The jury of five men and three women, after 8 days of testimony, decided that the trailer made by Gulf Stream Coach Inc. was not an “unreasonably dangerous” product under Louisiana law. Judge Kurt D. Engelhardt presided over the trial.  A likely issue on appeal will be the MDL court's decision to allow certain defendants to assert the government contractor defense.

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We posted here recently about proposed "climate change" legislation and how it may affect litigation. Now comes a  federal appeals court ruling allowing certain nuisance claims against major greenhouse gas emitters, a decision that may provide an impetus to more so-called climate change litigation.   See Connecticut v. American Electric Power Co., 2009 WL 2996729 (2nd Cir. Sept. 21, 2009). Interestingly, this is a two-judge decision as original panel member Judge is now Justice Sotomayor.

In 2004, 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. The plaintiffs' theory is that carbon dioxide acts as a greenhouse gas that traps heat in the earth's atmosphere, and that as a result of this trapped heat, the earth's temperature has risen over the years and will continue to rise in the future. Pointing to an alleged  “clear scientific consensus” that global warming has already begun to alter the natural world, plaintiffs predicted that it “will accelerate over the coming decades unless action is taken to reduce emissions of carbon dioxide.”

Because of the procedural posture (motion to dismiss), the court did not really describe the other side of the story, but readers of MassTortDefense know that change is what the climate is always doing as a result of the planet's orbital eccentricities, axial wobbles, solar brightness changes, cosmic ray flux, and multiple other factors. There are numerous plausible terrestrial drivers of climate changes too.  While global warming is a serious topic worthy of scientific study and political discussion, plaintiffs' "consensus" ignores that global mean temperature is only one part of climate, and may not be the best metric.  Moreover, the most important driver of the greenhouse effect are water vapor and clouds. Carbon dioxide is about 0.038% of the atmosphere, while water in its various forms ranges up to 4% of the atmosphere.  Scientists estimate that water accounts for about 90% of the Earth's greenhouse effect.  And humans are responsible for only about 3.4% of carbon dioxide emitted to the atmosphere annually, the rest of it being natural.  When plaintiffs talk about the consensus, another major issue is that the "warming" numbers come not from measurements but from computer models -- with a huge range of assumptions. One is the so-called multiplier effect which assumes that increasing atmospheric carbon dioxide causes a large increase in water vapor and thus a large rather than small temperature spike.

When thinking about "global climate" changes, we have also been sobered by the fact that humans have been trying to measure the temperature consistently only since the1880s, during which time advocates think the world may have warmed by about +0.6 °C -- which is less than the margin of error on our ability to measure the Earth's temperature!

Anyway, 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 held that plaintiffs' claims presented a non-justiciable political question and dismissed the complaints. 406 F. Supp. 2d 265.

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, the two judges held that the district court 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.

An important aspect of the ruling was that the the activity in Congress and the administrative agencies was not yet far enough along to displace common law relief. Federal common law is a necessary expedient to which federal courts may turn when compelled to consider federal questions which cannot be answered from federal statutes alone. But when Congress addresses a question previously governed by a decision rested on federal common law the need for lawmaking by federal courts disappears. The question whether a previously available federal common-law action has been displaced by federal statutory law involves an assessment of the scope of the legislation and whether the scheme established by Congress addresses the problem formerly governed by federal common law.  The court did note that it may happen that new federal laws and new federal regulations may in time pre-empt the field of federal common law of nuisance.  (EPA appears to be on the road on the road toward regulating greenhouse gases.) But at least until EPA makes more findings, for the purposes of a displacement analysis the Clean Air Act does not sufficiently regulate greenhouse gas emissions.

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.  The Supreme Court has further stated that the asserted injury must be actual or imminent, certainly impending and immediate --not remote, speculative, conjectural, or hypothetical. The court rejected defendants challenge that the contentions of future injury at some unspecified future date are not the kind of “imminent” injury required.  The court also gave short shrift to the argument that plaintiffs could neither isolate which alleged harms will be caused by defendants' emissions, nor allege that such emissions would alone cause any future harms. 

The ruling may pave the way for more public nuisance suits, as it appears to enable private, nonprofit entities like the Sierra Club to pursue these cases. Allowing such a claim to proceed to discovery raises the potential stakes for every defendant currently or potentially facing public nuisance liability. And thus defendants may be faced with the difficult choice of working towards legislation or facing more of this kind of litigation.
 

 

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In a wrongful death suit brought by the family of a chemical plant employee, the U.S. District Court for the Southern District of West Virginia predicted last week that West Virginia would allow the application of the “sophisticated user” and “bulk supplier” defenses to the plaintiff's product liability claim. Roney, et al. v. Gencorp, et al., No. 3:05-cv-00788 (S.D. W.Va. Sept. 4, 2009).

From 1965 until 1982, Mr. Roney worked at the Pantasote Corporation/Gencorp Inc. Polyvinyl Chloride plant in Point Pleasant, West Virginia. There, he worked extensively with vinyl chloride monomer (“VCM”) – a major raw component of Polyvinyl Chloride (“PVC”). VCM is now associated in some scientific studies with the particular form of liver cancer – angiosarcoma – to which Mr. Roney succumbed. Mr. Roney’s estate filed suit against the defendants for failure to disclose their alleged full knowledge of the danger of VCM and for failing to warn Mr. Roney of its hazardous nature.

Such cases raise, as readers of MassTortDefense know, the related and difficult issues of the duty and ability of a remote supplier of a bulk product to warn downstream users, the customers or employees of their actual customers.  The issue is complicated by the duty of the supplier's immediate customer, in its own right, to warn its customers and to provide a safe workplace for its own workers.  When should that independent or separate duty, imposed on a party who is arguably in a more direct position to pass on effective warnings, cut off the chain of causation flowing up to the remote supplier?  And what about when the employer/intermediate customer is itself an expert in the potential hazards of the product?

Here, in defense of the failure to warn claim, the main product supplier asserted that it had no duty to warn because that duty was obviated by the employer’s own duty to warn its workers. Such a defense, commonly referred to as a “sophisticated user” defense, is available in many states but had not been explicitly adopted or rejected in the state courts of West Virginia. In some jurisdictions the stress is on the bulk supplier aspect and the practicability of warning downstream users; in others the emphasis is in the knowledge of the customer.  Here, the court addressed both aspects.

Section 388 of the Restatement (Second) of Torts addresses a supplier’s potential liability
for a “Chattel Known to Be Dangerous for Intended Use.” Comment n of this section is commonly cited as the basis for the sophisticated user defense: There is necessarily some chance that
information given to the customer will not be communicated by him to those who are to use the
chattel. This chance varies with the circumstances existing at the time the chattel is turned over to the person, including the known or knowable character of the third person and the purpose for which the chattel is given. "Modern life would be intolerable unless one were permitted to rely to a certain extent on others' doing what they normally do, particularly if it is their duty to do so."

Plaintiff relied on the fact that the West Virginia Supreme Court has rejected the learned intermediary doctrine, a defense plaintiff claimed was similar to the sophisticated user defense. See State ex Rel. Johnson & Johnson Corp. v. Karl, 647 S.E.2d 899 (W.Va. 2007). The reasoning of that decision, questionable in its own right, is not applicable to a scenario outside of the prescription pharmaceutical context and the rise of direct-to-consumer advertising. In deciding Karl, the court had recognized that through such DTC advertising pharmaceutical companies had arguably gained direct access to patients, a relationship starkly different than that which had existed when the learned intermediary doctrine was developed – when patients received drug information exclusively through their doctors. And starkly different from the industrial context. Chemical workers would typically have had little opportunity to influence the choice of products to which they would be exposed. Instead, they relied upon their employer to determine the scope of their duties and their role in the production process. They were insulated from the manufacturer of the chemicals they used, much as the patient used to be insulated from the drug manufacturer, observed the court.

The duty to warn, said the federal court, involved an analysis of the reliability of the third party as a conduit of necessary information about the product; the magnitude of the risk involved; and the burdens imposed on the supplier by requiring that it directly warn all users. That, in turn, included the degree to which the danger related to the particular product is clearly known to the  purchaser/employer. Thus, West Virginia would recognize a sophisticated user defense.

As with the sophisticated user defense, the bulk supplier notion is rooted in Restatement § 388
comment n. While the sophisticated user defense focuses on the reasonableness of reliance on the employer, the bulk user defense concerns the burden which would be imposed on the supplier if it were bound to directly warn all downstream users.  The impracticability of the manufacturer getting a warning for a chemical shipped in tank trucks or rail cars to the employees of the customer would also be recognized as a defense in the state, predicted the federal court.

The court rejected the defendant's third assertion that the dangers of vinyl chloride monomer are “open and obvious," as the connection between cancer and VCM is not readily known outside scientific, medical and industrial communities, said the court.

 

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The U.S. Food and Drug Administration has launched two Internet-based initiatives that may be noteworthy for MassTortDefense readers involved in food safety issues.

First, the FDA has launched an Internet-based registry to track patterns in contaminated food.  The site, explained here, is a result of 2007 legislation requiring food facilities to report potentially dangerous products. Food industry officials are required to use the Reportable Food Registry to alert the FDA when they discover a risk that  their products might injure people or animals, the agency stated last week. By fostering real-time submission to the FDA of information on food safety hazards, the registry is supposed to enhance the agency’s ability to act quickly to prevent food-borne illness. The goal is to catch the problem before people get sick. 

Facilities that manufacture, process, or hold food for consumption in the U.S. must now tell the FDA within 24 hours if they find a “reasonable probability” that an article of food will cause severe health problems or death to a person or an animal. The reporting requirement, which applies to all foods and animal feed regulated by the FDA, does not reach infant formula and dietary supplements.

Any person who has to submit registration information to the FDA for a food facility that
manufactures, processes, packs, or holds food for human or animal consumption is deemed a “responsible party” and must follow the reporting requirement. A responsible party also must investigate the cause of the adulteration if the adulteration of food may have originated with the responsible party. 

The registry's proposal drew criticism from some industries, and they in fact had asked the FDA last month to extend the effective date for reporting. For example, national organizations representing the grain, feed, grain processing and pet food industries said that, at the very least, the FDA should exercise enforcement discretion in order to provide an appropriate phase-in period. FDA did not do so.

The launch of the FDA registry comes just as Congress is considering a new food safety bill that would give the FDA more funding and greater authority to order recalls of products. The House passed a food safety bill in the summer, and the Senate is expected to take up the issue later this fall.

At the same time, the administration is rolling out a new Web site designed to streamline food safety information for the public. Health and Human Services Secretary Sebelius announced the new Web site  last week. The site is a joint effort among HHS, the Department of Agriculture and the FDA.

The site will put food-related information from all federal agencies in one place.  It includes sections on how to "Keep Food Safe"; what to do in the case of suspected "Food Poisoning"; a section for industry relating to "Inspections & Compliance"; as well as food news, agency events (such as workshops, meetings, and conferences) for FDA, CDC, USDA; and educational materials on food safety.  Of particular interest to our readers may be the links to agency speeches and presentations, communications to Congress, and Congressional testimonies.

 

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The Tenth Circuit has upheld a trial court ruling remanding a proposed class action under the “local controversy exception” to federal jurisdiction under the Class Action Fairness Act (CAFA).  See Coffey v. Freeport-McMoRan Copper & Gold, No. 09-6106 (10th Cir.  9/4/09).  Plaintiffs filed a proposed class action in state court in Oklahoma on behalf of themselves and all other similarly situated persons asserting state law claims based on the defendants’ alleged contamination of their property through operation of the Blackwell Zinc Smelter in Blackwell, Oklahoma. The case alleges that the mining companies failed to clean up lead, arsenic and cadmium contamination in the Blackwell area from the decades-out-of-operation smelter plant.

 Defendants removed to federal court, and plaintiffs filed a motion to remand, arguing that there was no basis for federal jurisdiction. The district court granted the motion, concluding that plaintiffs had demonstrated that their case fell within the “local controversy exception” to CAFA, and did not raise a federal question under CERCLA.

CAFA was enacted to respond to perceived abusive practices by plaintiff attorneys in litigating major class actions. CAFA allows federal jurisdiction over class actions involving at least 100 members and over $5 million in controversy when minimal diversity is met (between at least one defendant and one plaintiff-class member). It is undisputed that those standards were met here. Congress did create an exception to CAFA, however, for those cases consisting of primarily local, intrastate matters, which it characterized as the “Local Controversy Exception,” S. Rep. No. 109-14, at 39 (2005).  The court concluded this case presents a classic example of what Congress intended to cover when it created this exception. It is a “truly local controversy— a controversy
that uniquely affects a particular locality to the exclusion of all others.”

There are three main requirements for plaintiffs to meet in order to satisfy the “local controversy exception.”  The defendants did not contest that plaintiffs met two of the three requirements—all of the members of the plaintiff class are Oklahoma citizens, and the principal injuries occurred in Oklahoma. What was in dispute was that requirement that there be at least “one real local defendant.” In order to satisfy this “local defendant” requirement, plaintiffs must show that at least 1 defendant is a defendant from whom significant relief is sought by members of the plaintiff class; whose alleged conduct forms a significant basis for the claims asserted by the proposed plaintiff class; and who is a citizen of the State in which the action was originally filed.  In particular, defendants argued that plaintiffs failed to show that defendant BZC -- the alleged local -- was a defendant from whom significant relief is sought or that BZC was a citizen of Oklahoma.

Although BZC was the operator of the smelter from 1922-1974, defendants argued that the language “from whom significant relief is sought” requires consideration of a defendant’s ability to pay a judgment, citing Robinson v. Cheetah Transportation, No. 06-0005, 2006 WL 468820 (W.D. La. Feb. 27, 2006).  Since BZC had no assets to satisfy any potential judgment, therefore BZC could not be considered a defendant from whom significant relief is sought.  The district court ultimately rejected defendants’ position, concluding that the CAFA exception refers to a defendant from whom significant relief is “sought,” rather than a defendant from whom the relief “may be obtained” or “can be collected” or words of similar import. The 10th Circuit agreed with the district court’s plain language analysis. The statutory language was found to be unambiguous, and a “defendant from whom significant relief is sought” does not mean a “defendant from whom significant relief may be obtained.”  There was nothing in the language of the statute that indicates Congress intended district courts to wade into the factual swamp of assessing the financial viability of a defendant as part of this preliminary consideration, said the per curiam opinion.

On the second issue, citizenship, a district court’s determination about a corporation’s principal place of business “is a question of fact that we review for clear error.”  BZC owned the real property in Oklahoma and pays taxes on that property; it had filed an application for a permit to operate a groundwater treatment plant in Oklahoma.  Thus, the court concluded that BZC’s clean up activity was a “substantial activity in which it is currently engaged” and that this “activity suffices to establish Oklahoma as BZC’s principal place of business.” 

Although the appeals court has discretion to exercise its appellate jurisdiction to review the CERCLA issue, the Tenth Circuit said, it declined to exercise that discretion.

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The U.S. Chamber of Commerce last week filed a supplemental request for an “on-the-record” hearing to debate the evidence behind the Environmental Protection Agency’s expected finding that greenhouse gases endanger the public health and welfare.

Readers of MassTortDefense may recall that in 2007, in Massachusetts v. EPA, 549 U.S. 497 (2007), the Supreme Court found that greenhouse gases could be regarded as air pollutants, and held that EPA must determine whether or not emissions of greenhouse gases from motor vehicles cause or contribute to air pollution which may reasonably be anticipated to endanger public health or welfare, or whether the science is too uncertain to make a reasoned decision. In making these decisions, the agency is required to follow the language of section 202(a) of the Clean Air Act. The Supreme Court decision resulted from a petition for rulemaking under section 202(a) filed by more than a dozen environmental, renewable energy, and other organizations.

The EPA is proposing to find that the current and projected concentrations of the mix of six key greenhouse gases — carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and sulfur hexafluoride (SF6) — in the atmosphere threaten the public health and welfare of current and future generations. This is typically referred to as an "endangerment finding."  EPA is further proposing to find that the combined emissions of CO2, CH4, N2O, and HFCs from new motor vehicles and motor vehicle engines contribute to the atmospheric concentrations of these key greenhouse gases and hence to the threat of climate change.  While an endangerment finding under the Clean Air Act would not by itself automatically trigger extensive regulation under the entire Act, many observers expect such regulations.  Moreover, the finding could prod the Congress to pass controversial climate legislation.  Finally, it may impact the pace and weight of climate change litigation.

The Chamber argues that the informal notice-and-comment process employed here has not worked to air the issues, and the only real solution is an on-the-record hearing for a transparent review of all the evidence.  Having reviewed the evidence in EPA’s endangerment docket, the Chamber observes flaws and omissions in the reasoning underlying the proposed endangerment finding. The Chamber is thus asking for more transparency in this process, as the ruling could ultimately cause a "regulatory train wreck" with inescapable economic consequences, as well as an impact on mass tort litigation. The agency has apparently ignored evidence contradicting its preliminary conclusions on a wide range of issues, such as the alleged effect higher temperatures will have on net mortality and on the levels of other pollutants.  Media reports have surfaced that EPA ignored a study by two members of its staff concluding that the agency had relied on outdated studies and that the current state of climate science refutes the proposed endangerment finding.

 

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The FDA is considering issuing guidelines on acrylamide content in food.  The agency has published a notice seeking comments from industry on the issue.

Acrylamide is a chemical formed primarily in baked and fried foods by a reaction between sugars and the amino acid asparagine. The reaction is partly responsible for the golden color and tasty flavor of baked, fried, and toasted foods. In 2002, some Swedish scientists reported unexpectedly high levels of acrylamide in carbohydrate-rich foods and also published a study associating the chemical to cancer in laboratory rats. Further research subsequently determined that acrylamide can form in some foods during certain types of high-temperature cooking.

FDA has not yet issued guidance for manufacturers on reducing acrylamide in food. However, it is anticipated by the agency that new information will soon be available about the toxicology of acrylamide, which may shed light on acrylamide's potential carcinogenicity in laboratory animals. Readers of MassTortDefense know how difficult it is to leap from animal studies to causation conclusions in human beings, because of the physiological and metabolism differences between species, the excessive dosages that are (and typically must be) given to experimental animals, and the varying biological defense mechanisms that species have to environmental insults.

International efforts to develop approaches to acrylamide mitigation are also beginning to prove successful. Moreover, FDA is aware that at least some manufacturers in the United States are seeking ways to reduce acrylamide in their products. In this context, FDA is considering issuing guidance for industry on reduction of acrylamide levels in food products.

Health Canada recently added acrylamide to that nation’s toxic substances list, as part of its ongoing review of over 200 chemical substances in commercial use. It stated that current consumption levels “may constitute a danger in Canada to human life or health,” but it also acknowledged that research into a possible carcinogenic link for humans has so far been inconclusive.

In fact, dietary intakes of acrylamide are not related to increased risks of brain cancer, according to a recently released study of 58,279 men and 62,573 women, published by Maastricht University in the Netherlands. J.G.F. Hogervorst, et al., “Dietary Acrylamide Intake and Brain Cancer Risk,” 18 Cancer Epidemiology, Biomarkers & Prevention (2009).  Researchers have also reported in the Journal of the National Cancer Institute that dietary acrylamide was not linked to lung cancer risk, and that the compounds may even reduce the risk in women. "Lung Cancer Risk in Relation to Dietary Acrylamide Intake," 101(9) JNCI 651-662 (2009).

 

 

In seeking comments, the FDA has asked food manufacturers to respond with details of any manufacturing changes they have made, the success and cost-effectiveness of those changes, methods for acrylamide reduction that could be appropriate for smaller manufacturers, and changes to on-pack instructions for consumers to mitigate acrylamide formation.

 

 

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A new study published in the European Respiratory Journal is generating media attention, and some observers assert it may have far-reaching implications for the nano-tech industry. Is this warranted?

In this study, Song, et al., Exposure to nano-particles is related to pleural effusion, pulmonary fibrosis and granuloma, 34(3) Eur. Respir. J. 559-567 (2009), researchers at China's Capital University of Medical Sciences linked lung disease in seven Chinese workers, two of whom reportedly died, to nano-particle exposures in a print plant where a paste containing nano-particles was sprayed onto a polystyrene substrate, with subsequent heat-curing.

The study reported that seven young female workers (ages 18–47), exposed to nano-particles for 5–13 months, were admitted to the hospital, all with shortness of breath and pleural effusions. Polyacrylate, consisting of nano-particles, was confirmed in the workplace. Pathological examinations of the patients' lung tissue displayed non-specific pulmonary inflammation, pulmonary fibrosis, and foreign-body granulomas of pleura. By transmission electron microscopy, nano-particles were observed to have lodged in the cytoplasm and caryoplasm of pulmonary epithelial and mesothelial cells, but also were located in the chest fluid.

The authors expressed concern that long-term exposure to some nano-particles may be related to serious damage to human lungs.  But, putting the media reception aside, this study appears to do more to highlight the common sense need to follow good industrial hygiene practices than to provide compelling evidence of any unique health risks posed by engineered nano-particles. The plant sprayed a strong chemical paste and then heated plastic material in an enclosed space apparently lacking ventilation.  The room in which the women worked was small and unventilated for a significant part of their exposure period. Only on occasion, they wore mere "cotton gauze masks." 

From the study it appears that the workers had a complicated exposure history to a mix of chemicals; while there was a reported association of nano-particles with lung disease, it is unclear which, if any, of the chemical exposures might have contributed to the lung issues. Readers of MassTortDefense know that an association is not causation.  For example, formation of thermodegradation fume products are known to cause significant occupational disease, and paint spraying has been shown to be potentially harmful long before nano-sizing of chemicals was utilized. 

Moreover, sufficient exposure information necessary to even begin to think about a causal connection between exposure to nano-sized particles in the paste/dust and lung and heart disease in the workers was missing.  Clearly, there may be alternative explanations for what the study authors described finding in the patients.

As noted here before, NIOSH emphasizes the use of a variety of engineering control techniques, implementation of a risk management program in workplaces where exposure to nanomaterials exists, and use of good work practices to help to minimize worker exposures to nanomaterials.
 

 

 

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An Alabama construction company that is a party in the multidistrict litigation over allegedly tainted Chinese-made drywall has asked for a default judgment against a foreign manufacturer/seller of gypsum drywall. Mitchell Co. Inc., et al. v. Knauf Gips KG, et al., No. 09-cv-4115 (E.D. La.).

Mitchell filed a motion last week  in the U.S. District Court for the Eastern District of Louisiana asking for a default judgment against China-based Taishan Gypsum Co. Ltd.  The motion alleges that Taishan has not responded to the plaintiff's complaint nor entered an appearance.  Mitchell filed its original complaint back in March, in the Northern District of Florida, seeking to represent a class of plaintiffs who allege they incurred expenses stemming from defective drywall.  The complaint names several drywall makers and sellers.  The case was later transferred with related actions to the MDL in front of Judge Fallon. In re: Chinese-Manufactured Drywall Products Liability Litigation, No. 09-md-02047 (E.D. La.). 

Interestingly, the motion comes as the Congress debates a bill that would make it easier for foreign manufacturers to be sued when their products allegedly injure U.S. consumers, the Foreign Manufacturers Legal Accountability Act of 2009.

MassTortDefense has posted about the alleged problems with Chinese imported drywall. In litigation over the issues, Lennar Corp., the U.S.' second largest home-builder (by volume), has sued more than two dozen manufacturers, suppliers and installers.  As noted here before, Sens. Bill Nelson, D-Fla., and Mary Landrieu, D-La., have introduced legislation tied to Chinese drywall.  Also, the CPSC reports that it has now received a total of 810 reports related to the allegedly defective drywall, including complaints from two additional states, Pennsylvania and South Carolina. That means the Commission (criticized in some circles for its work on this issue)has received reports from homeowners in 23 states and the District of Columbia. The majority of the reports continue to be from Florida, Louisiana, and Virginia. About 6.2 million sheets of Chinese drywall were imported into the U.S. during 2006.

 

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A California appellate court last week affirmed a trial court ruling denying class certification to a group of Boeing employees suing over alleged exposure to harmful levels of beryllium. Marin v. Brush Wellman Inc.,  No. B208202 (Calif. Ct. App., 2nd Dist. Aug. 24, 2009).

The plaintiffs alleged that Brush Wellman, a contractor of their employer, misrepresented the permissible limit for beryllium exposure. Beryllium is a potentially toxic metal that is used in aircraft construction and other industrial applications because of its light weight and great strength. However, some exposed persons are beryllium sensitization, which can be a precursor to chronic beryllium disease, which is a serious illness. 

The court of appeals agreed with the trial court that common issues did not predominate. In a toxic tort case, the plaintiff must first establish some threshold exposure to the defendant's defective, toxic products, and must also establish to a reasonable medical probability that a particular exposure or series of exposures was a legal cause of his injury, i.e., a substantial factor in bringing about the injury. This typically requires expert testimony about the level of exposure that is unsafe, and expert testimony that exposure above a certain level will cause injury or disease. The significance of this is  that when individual claimants differ both in their makeup and in the amount of their exposure to the substance, the evidence of their injuries will differ from individual to individual.

Here, each of the class members would have to show where he worked, when he worked within each location or facility, what the beryllium levels were at these locations, and how much of the beryllium was Wellman's.  It is patent that each such package of facts will be largely unique to each claimant.  The six named plaintiffs worked at six different facilities, some of which had multiple buildings, over differing periods covering up to 40 years. Boeing's air monitoring and industrial hygiene records showed non-uniform results. In other words, the levels of exposure varied widely among the facilities over time, and even within a single facility. The sales and use evidence that could be used to trace the beryllium to Wellman implicated a necessarily individualized inquiry, not a common one.

In an effort to salvage a class, plaintiffs' counsel explained at oral argument that the proposed class was only for those who required medical monitoring. Those persons who actually contracted illness would be excluded from the class as their claims would be necessarily unique and individualized.  Even assuming this issue was properly presented to the trial court, the plan to certify a class of persons requiring medical monitoring and, in addition to such a class, allowing the more serious cases to proceed individually and separately, was to the court "an invitation to a litigation disaster."   Recourse to such a class would do nothing to streamline this litigation but would most probably convert it into a nightmare.

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The FDA's Science Board earlier this week heard  an update from the agency regarding the continued assessment of Bisphenol-A (BPA) in FDA-regulated products. (The Science Board to the Food and Drug Administration provides advice primarily to the Commissioner and other government officials on complex and technical issues as well as emerging issues within the scientific community.  The Board consists of a core of 21 members who are supposed to be authorities knowledgeable in the fields of food safety, nutrition, chemistry, pharmacology, toxicology, clinical research, and other scientific disciplines. Members represent academia and industry.)

At the meeting's update from the agency regarding the continued assessment of BPA,  the FDA Acting Deputy Commissioner briefed the agency's Science Board about agency plans to complete its evaluation of bisphenol A;  Dr. Goodman, who is also FDA's acting chief scientist, reportedly stated that the FDA will decide by Nov. 30 whether it will regulate bisphenol A in food packaging. FDA's National Center for Toxicological Research also described a variety of rodent and monkey studies that FDA is undertaking to further assess bisphenol A and potential health effects.

A representative of the Natural Resources Defense Council was among the public speakers who urged FDA to ban bisphenol A, despite the fact that the few studies of laboratory animals that have suggested an association with reproductive or developmental issues have used nonstandard test methods. Studies using standard protocols have not found any significant problems. The American Chemistry Council, BPA Joint Trade Association, and other industry groups argue that food and beverage containers made with BPA pose no undue risk of harm.  BPA is used in the lining of some food and beverage cans to prevent spoilage and is also used in a variety of other consumer products to enhance the structural integrity of plastic containers. Assessments conducted by Health Canada and California's Environmental Protection Agency suggest that dietary exposure would not pose risk to infants. Infant formula may be the most highly regulated food in the world.

Earlier this month, the Massachusetts Department of Public Health issued a health advisory   to parents and caretakers of children up to the age of two years suggesting they avoid the use of products that contain BPA for making or storing infant formula and breast milk. The state health agency further advised pregnant and breastfeeding women to avoid products that may contain BPA. The agency also noted that researchers caution that more research needs to be conducted.

Readers of MassTortDefense interested in BPA issue may want to look at "Science Suppressed: How America became obsessed with BPA,"  an in-depth examination by the STATS program at George Mason University of the science, risk assessment, and media coverage of the chemical, based on interviews with the lead authors of two major risk assessments, and focusing on the accuracy of the media's campaign to have the chemical banned. Some newspapers' coverage has had a knack, says the study, for avoiding research that showed BPA was safe, including risk assessments by the European Union, NSF International, Japan, and a lot more. Some of the media coverage has relied on a small circle of researchers whose work on BPA has been rejected by risk assessments across the world.

After the National Toxicology Program draft report was issued in early 2008, plaintiffs' attorneys nationwide began filing consumer class action complaints claiming violations of state consumer protection laws, fraud, breach of warranty, unjust enrichment, strict product liability, breach of contract and negligence. The lawsuits were consolidated as an MDL in the Western District of Missouri, last year (MDL-1967).  This multidistrict litigation consists of more than 25 cases that involve allegations concerning in baby bottles.

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Defendants have moved to dismiss the complaint in a proposed class action by parents claiming that the makers of shampoos and and soaps for kids failed to list toxic chemicals on product ingredients lists. Vercellono, et al. v. Gerber Products Co., et al., No. 2:09-cv-02350 (D.N.J.).

The complaint names Gerber, Johnson & Johnson Consumer Cos. Inc., Procter & Gamble
Distributing LLC, MZB Personal Care, Wal-Mart Stores Inc. and Nestle Inc. as defendants.
The plaintiffs claim that several products, including Grins & Giggles, Head-to-Toe Baby Wash and others, contain formaldehyde and 1,4-dioxane.  Plaintiffs further allege that these chemicals have been linked to cancer, skin allergies and other health problems.

The plaintiffs are seeking compensatory, punitive and/or exemplary damages for the proposed class, which is defined as all consumers nationwide who purchased the products in question.  Plaintiffs allege that the companies violated consumer fraud statutes by making or distributing baby care products specifically marketed for sensitive skin despite containing the chemicals, and misrepresented that the products they marketed, distributed, promoted, sold, and/or made were safe for children.

Defendants' motions attack several aspects of the complaint, including the injury allegations in connection with the consumer fraud count.  The motion illustrates one of the key battlegrounds in a consumer fraud class action.  While plaintiffs typically assert that the predominating issues are common, defendants will point to the injury element under the statute as requiring individual proof.  But before even deciding the class issues, the question is raised whether plaintiffs have adequately alleged an  injury.  Often, they will seek to avoid suggestion of personal physical injury, because of the individual issues it raises.  But there is risk in going too far.

According to the Gerber motion, plaintiffs suffered only mere exposure to the chemicals and failed to cite any actual injury. The complaint fails to allege that plaintiffs, their children, or anyone else has ever suffered any actual harm as a result of using the products. Nor does the complaint allege that the products failed to perform as a bath product. Rather, the complaint merely alleges that plaintiffs have suffered “exposure” to formaldehyde and 1,4-dioxane.  While they assert that they were injured by paying the purchase prices for the defendants’ products, under the New Jersey Consumer Fraud Act, as under many such acts, plaintiffs are required to allege that they have suffered an ascertainable loss, and allegations of economic loss are insufficient, as are allegations of  the vague potential of a speculative future injury.

 

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Although we haven't posted about it much, a number of environmental groups, states and private citizens have brought litigation, seeking to turn climate change issues into mass torts. Thus far, the litigation, which has focused principally on greenhouse gas emissions, has not been very successful. Unlike typical mass tort litigation, some of these plaintiffs admit that part of the goal of the cases is to encourage Congress to act on legislation (leading to regulation) that would achieve some of the same goals.

One example is the mass tort suit filed in 2008 by residents of a small Alaskan village against two dozen energy companies, claiming that carbon dioxide and other greenhouse gases have left their town uninhabitable. Native Village of Kialina v. Exxon Mobil Corp., et al., 2008 WL 2951742 (C.D.Cal.)

Now comes word that a number of studies will be released in the near future, examining the potential impact of pending climate-change legislation, including its effect on food prices. Under the proposed climate-change legislation, a carbon offset, or credit, can be generated when a company reduces the amount of greenhouse gas emitted into the atmosphere. The resulting offsets can then be sold to other polluters or used by the producer to reduce its overall emission totals. Certain companies would have to pay penalties if they emit more than allowed without offsets.The House passed a bill, the American Clean Energy and Security Act of 2009, in late June. There is concern the bill doesn't provide sufficient incentives for food and agricultural companies to receive and generate carbon credits to offset their carbon emissions. The Senate is expected to take up its own climate bill next month. Critics say that the House bill also risks an increase in food and feed prices, and a reduction in the international competitiveness of U.S. businesses.

Again, the legislation and any resulting regulation may have a significant impact on whether the courts will breathe life into mass tort litigation relating to alleged climate change issues.

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A jury in Mason County, W.Va., issued a unanimous verdict last week for welding industry defendants, rejecting claims that injuries to former welder John Belcher were caused by their products. Adkins, et al v. Airco, et al., No. 06-103 (W.Va. Cir. Ct., Mason Cty.)

Apparently jurors deliberated for only a couple hours after an eight-day trial before Circuit Judge David W. Nibert.  Defendants at the trial included Lincoln Electric Company Inc., Hobart Brothers Inc. and The BOC Group Inc. The Circuit Court had entered a gag order before trial to avoid prejudicing potential jurors, so there wasn’t much press on this one.

Defendants have won about 85% of the trials so far in this mass tort. And along with numerous defense verdicts like this one, this litigation has seen the dismissals of thousands of cases. The total number of pending welding fume cases has dropped by more than one half since January 2006. In the MDL in Cleveland, the plaintiffs recently dismissed more than two thirds of the cases they had certified as "ready for trial. "

The next bellwether trial in the federal MDL in front of  Judge O'Malley is set for September. Plaintiff Cooley, a long time welder from Iowa, alleges manganese neuro-toxicity, which defendants contend is not actually a recognized disease. Both sides have recently filed motions to knock out the other's expert opinions under the Daubert doctrine.

 

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A Minnesota appeals court recently affirmed summary judgment for defendants in a suit by a woman who alleged hormone replacement drugs caused her breast cancer. Zandi v. Wyeth, 2009 WL 2151141 (Minn.App.)

Plaintiff alleged that between approximately 1981 and 2001, she ingested hormone-replacement-therapy (HRT) drugs manufactured, designed, packaged, marketed, and distributed by defendants.   In November 2001, Zandi was diagnosed with "hormone-dependent breast cancer."  She contended that the HRT drugs caused her cancer.  She brought claims for negligence, strict liability, breach of implied warranty, breach of ex-press warranty, fraud, misrepresentation, and violation of the Minnesota fraudulent advertising act, the Minnesota Prevention of Consumer Fraud Act, and the Minnesota Uniform Deceptive Trade Practices Act.

The trial court  found that plaintiff's specific causation evidence did not satisfy Minnesota's standard for admissibility of expert testimony.  Zandi offered testimony from Dr. Lester Layfield and Dr. Gail Bender to prove that HRT drugs caused her cancer. Minnesota courts use the Frye standard to determine the admissibility of novel scientific evidence. Goeb v. Tharaldson, 615 N.W.2d 800, 814 (Minn.2000). Under Minnesota's version of this standard, the proponent of scientific evidence must establish that the scientific theory is generally accepted in the relevant medical or scientific community and that the principles and methodology used are reliable.  McDonough v. Allina Health Sys., 685 N.W.2d 688, 694 (Minn.App.2004). When novel scientific evidence is offered, (1) the trial court must determine whether it is generally accepted in the relevant scientific community; (2) the particular scientific evidence in each case must be shown to have foundational reliability.

Zandi's claims were based on the following propositions: 1) it is generally accepted that HRT causes hormone-dependent breast cancer, and 2) there is a generally accepted method of diagnosing the cause of hormone-dependent breast cancer in an individual.  The appellate issues revolved around the second.  Defendants alleged that even if one assumes the relevant scientific community generally accepts that HRT causes hormone-dependent breast cancer, Zandi had failed to establish that the relevant scientific community generally agrees that there is a method of diagnosing the cause of breast cancer in a particular person.

Plaintiff's experts based their specific causation opinions on epidemiological studies and differential diagnosis. But  the science of epidemiology does not address the cause of an individual's disease. Epidemiology is concerned with the incidence of disease in populations and does not address the question of cause of an individual's disease. Epidemiology has its limits at the point where an inference is made that the relationship between an agent and a disease is causal (general causation) and where magnitude of excess risk attributed to the agent has been determined; that is, epidemiology addresses whether an agent can cause disease, not whether an agent did cause a specific plaintiff's disease. See Green et al., Reference Guide on Epidemiology, in Reference Manual on Scientific Evidence 333, 381-82 (Fed.Jud.Ctr.2d ed.2000).

Plaintiff's experts also relied on differential diagnosis. As used by plaintiffs, differential diagnosis adopts a process of elimination to identify cause; it  seeks to eliminates the possibility of competing causes or confounding factors. Goeb, 615 N.W.2d at 815.  In performing a differential diagnosis, a physician begins by ruling in all scientifically plausible causes of the patient's injury. The physician then rules out the least plausible causes of injury until the most likely cause remains.  Yet, breast cancer does not lend itself to such a differential diagnosis because the scientific community has not accepted that breast cancer has a limited number of discrete and recognized possible causes such that ruling out one cause would implicate another. For differential diagnosis to be sufficiently reliable to prove causation, the diagnostician should rule out all other hypotheses, or at least explain why the other conceivable causes are excludable.

Additional risk factors that plaintiff failed to adequately account for here included family history. Indeed, plaintiff's experts suggested that it is possible to conduct a reliable differential diagnosis without ruling out other hypotheses.

On this record, the court said, “We conclude that there is not a method of diagnosing the specific cause of a particular woman's breast cancer that is generally accepted in the relevant scientific community. This reality leaves Zandi without a legally sufficient ability to prove specific causation.”
 

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A federal judge has dismissed a proposed class action that alleged that Playtex Products Inc. sold  insulated baby-bottle coolers with excessive levels of lead. Ramos v. Playtex Products Inc. et al., No. 1:08-cv-02703 (N.D. Ill. 2009).

At MassTortDefense we love talking about defense wins, and especially love posting about early wins.  Here, Judge Joan Humphrey Lefkow dismissed all counts in the consolidated complaint without prejudice. The court relied first on the federal pleading requirements as described in Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007); and Ashcroft v. Iqbal, 129 S. Ct. 1937, 1953 (2009) (stating that “Twombly expounded the pleading standard for all civil actions”). We have posted on that before.
 

Plaintiffs alleged that the vinyl fabric from which these coolers are constructed contains dangerous levels of lead and that Playtex marketed these products as being safe, despite its awareness of regulations prohibiting the use of lead in children’s products and knowing that children who ingest lead suffer long-term injuries. Plaintiffs asserted claims for violation of the consumer fraud statutes of forty-three jurisdictions (Count I), common law negligence (Count II), and unjust enrichment (Count III). In the motion papers, the negligence claim became a medical monitoring claim.

The judge said the plaintiffs’ complaint was unable to meet pleading standards for the
claims alleged. The plaintiffs had failed to articulate many important points, including the basis for  their claims under any consumer protection statutes other than in New York and California. Named plaintiffs, Suarez and Stanford, were residents of New York and California, respectively, and neither alleged injury in, or contact with, any jurisdiction other than New York or California.

Additionally, the plaintiffs' claims failed to meet pleading standards of Rule 9(b) because of the absence of numerous crucial details, including where and from whom they purchased the coolers, specifics regarding the presence of lead in the products, such as where and how accessible it was, and whether they relied on statements from Playtex about the coolers’ safety before making their purchases. Averments of consumer fraud generally must be pleaded with the same particularity as common law fraud. See, e.g., Kearns v. Ford Motor Co., 567 F.3d 1120, 1125 (9th Cir. 2009). Even where, as here, plaintiffs assert that fraud is not a necessary element of a claim, any claim with a basis that nonetheless sounds in fraud is subject to the heightened pleading standard of Rule 9(b).  Plaintiffs quoted statements on Playtex’s website assuring customers that its products “surpass the most stringent domestic and international regulatory guidelines on . . . safety matters,” Am. Compl. ¶ 33, but failed to allege whether or when they relied on, or even saw, these statements prior to purchasing the coolers.

Additionally, plaintiffs wanted Playtex to pay for the cost of lead testing for their children, presumably a medical monitoring claim, yet at no point did they make any allegation that their children were exposed to lead.  Indeed, Suarez and Stanford fail to allege that they even have children. Playtex pointed out that the plaintiffs had not described any physical or economic injury associated with the product.  Plaintiffs expressly disclaimed personal injuries in this case at oral argument. What is required to support a claim for medical monitoring is that plaintiffs plead and prove that medical monitoring is probably, reasonably, not just possibly, necessary. The plaintiffs had asserted no allegation that any child came into contact with one of the coolers.  Thus, no allegation of the exposure element of a medical monitoring claim either.

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The Wisconsin Supreme Court has affirmed a lower court's dismissal of strict liability and negligence claims against white lead carbonate pigment manufacturers, ruling that a product's characteristic ingredient cannot  constitute a design defect. See Ruben Baez Godoy v. E.I. du Pont Nemours and Co. et al., No. 2006AP2670 (Wisc. S.Ct.).

The court affirmed a circuit court's ruling that the complaint had failed to allege a design feature that rendered defective the design of white carbonate lead pigment, which can be found in white paint.
Plaintiff alleged lead poisoning from white lead carbonate pigment in the paint in his Milwaukee apartment, and sued DuPont, Armstrong Containers, Sherwin-Williams and American Cyanamid.
He asserted that despite alleged knowledge that lead is hazardous to human health, the manufacturers promoted the use of the pigment and marketed it as safe.

The lower court dismissed the design defect claims, finding  that lead is an inherent  characteristic of white lead carbonate, and thus the product cannot be designed without lead. The court of
appeals found that a product cannot be said to be defectively designed when that design is inherent in the nature of the product so that an alternative design would make the product something else.  This is the long-standing, but often misunderstood notion, that an alternative product is not an alternative design.  In those states in which a plaintiff must prove the existence of a feasible alternative design that would have avoided the injury, or in which the defendant may show the absence of any feasible alternative design, it is not enough for a plaintiff to point to a different product that might serve the same use. 

The state Supreme Court affirmed, noting that a claim for defective design cannot be maintained where the presence of lead is the alleged defect in design, and its very presence is a characteristic of the product itself.  Without lead, there can be no white lead carbonate pigment.  The court offered an analogy:  Foil for your kitchen use can be made using ingredients other than aluminum (gold, for example), but aluminum foil cannot be made without aluminum. The presence of aluminum is characteristic of aluminum foil. If the mere presence of aluminum posed a danger, a manufacturer might be liable based on the failure to adequately warn or other claims. However, the manufacturer
would not be liable based on the "design" of aluminum foil for including aluminum.

Interestingly, the court reaffirmed that Wisconsin strict products liability law does not require a
plaintiff to prove the feasibility of an alternative design.  However, the feasibility of an alternative design can be considered when evaluating a design defect claim. While plaintiff argued that it is inconsistent to reject a reasonable alternative design requirement and still maintain that characteristic ingredients of the product cannot support a claim for defective design, the court clarified that it was not requiring that a plaintiff affirmatively prove, through expert testimony, that an alternative design was commercially viable. The court was simply acknowledging that some ingredients cannot be eliminated from a design without eliminating the product itself. When the ingredient cannot be designed out of the product, the Restatement (Second) instructs that although other claims may be theoretically asserted, the proper claim is not design defect.  

That rationale would seem to apply to design defect claims in drug cases, where the characteristics of a chemical constituting an FDA-approved drug are challenged. The "design" of a typical drug cannot be changed without creating a different molecular structure, and hence  a different product, one which would require a second FDA approval.

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The judge in charge of multidistrict litigation involving Wyeth Pharmaceuticals' hormone replacement pill, Prempro, has decided to sanction a law firm representing hundreds of plaintiffs, for its failure to timely produce completed client fact sheets. In re: Prempro Products et al., No. 4:03-cv-01507 (E.D. Ark.). 

Judge Wilson of the U.S. District Court for the Eastern District of Arkansas recently granted Wyeth's motion for sanctions against a Texas-based firm, although he declined to dismiss the plaintiffs.

Readers of MassTortDefense know the role plaintiff fact sheets (PFT) play in mass tort litigation, replacing some aspects of basic fact discovery; allowing defendants to gather information for early case assessment; beginning the process that winnows the number of cases that will be subjected to fuller case-specific fact discovery and expert discovery; and eventually informing the pool of cases available for initial trials if the case management process includes bellwether trials. 

The information requested on the PFT is often a negotiated topic, but typically includes information that any plaintiff's attorney who has done a good faith, Rule 11 assessment of the claim should have, or could readily access. The Manual for Complex Litigation notes that in lieu of interrogatories, questionnaires directed to individual plaintiffs in standard, agreed-on forms were used successfully in the breast implant and diet drug litigation.  It also includes sample case management orders regarding, inter alia, plaintiff fact sheets. (For other examples of plaintiff fact sheets, see In re Baycol Products Litigation, MDL 1431, Pretrial Order No. 10 (D. Minn. Mar. 18, 2002) and In re Phenylpropanolamine (PPA) Products Liability Litigation, MDL No. 1407, Case Management Order No. 6 (W.D. Wash. Mar. 21, 2002)).

Wyeth showed the court that the plaintiff firm missed several court deadlines to serve completed fact sheets for each of its clients. Wyeth first argued in 2008 that plaintiffs represented by the firm had repeatedly submitted incomplete fact sheets in which they provided merely a “will supplement” answer to several questions. Judge Wilson agreed and issued an order on Dec. 17, 2008,
directing the firm to produce completed fact sheets by Feb. 2, 2009.  In February, defendant again complained to the court that hundreds of fact sheets had not been served by the deadline and that many of those that had been produced remained incomplete, with plaintiffs replacing “will supplement” with the vague language that plaintiffs do "not recall and do not have reasonable access to the information that would be responsive to this question without undue burden or cost.”
Plaintiffs were then given until April 13 to resubmit the fact sheets in accordance with the order, and the responses led Wyeth to renew its bid for sanctions including dismissal.

The judge directed the firm to pay $5,000 to Wyeth to partially compensate it for the time and effort involved in seeking adequate fact sheets.  The firm must also assign an associate or paralegal to immediately contact all plaintiffs identified by Wyeth as still having insufficient fact sheets and to have the documents filled out by August 5th.

The court warned that it was likely that additional sanctions — and perhaps considerably more severe sanctions — will be imposed if substantial effort is required to review the adequacy of fact sheets filed by Aug. 5, 2009. 

The court indicated it had seriously considered dismissing all the affected cases without prejudice, and with the proviso that if a case was refiled it must have a reasonably accurate fact sheet attached and that sanctions against counsel would likely be imposed if additional fact sheets were attached with non-answers.  Only the administrative burden of dealing with amended complaint filings prevented this.

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A federal judge has decided an that an advisory jury can hear evidence on claims against the U.S. government in bellwether trials in the MDL concerning alleged formaldehyde-laden trailers. In re: FEMA Trailer Formaldehyde Products Liability Litigation, MDL 1873 (E.D. La.)

Readers of MassTortDefense will recall how Hurricane Katrina devastated much of the Gulf Coast in 2005. The total damage of Hurricane Katrina has been estimated at $75 billion, while not-much-later Hurricane Rita caused $10 billion in damage. The government, through FEMA, moved individuals whose homes were lost or deemed uninhabitable into makeshift housing provided by the agency.  Plaintiffs allege that the trailers had components that exposed them to dangerous and excessive levels of formaldehyde.

The court has decided that it will hold bellwether trials in the MDL. But the defendants include both private entities and the government. The government moved to strike the jury demand and requested that a jury not be involved in any manner in determining its liability. The federal government argued that, because the plaintiffs have filed claims under the Federal Torts Claims Act (“FTCA”), 28 U.S.C. §§ 2671-2680 and 28 U.S.C. § 1346(b), the use of any jury is precluded under 28 U.S.C. § 2402 which states that “[a]ny action against the United States under section 1346 shall be tried by the court without a jury. . .”  The Plaintiffs’ Steering Committee (“PSC”) and the nongovernmental defendants both opposed the motion. Indeed, both the PSC and the non-governmental defendants contended that it is both permissible and sensible for the court to utilize an advisory jury who will hear evidence of the Government’s alleged fault in order to properly apportion liability to all parties. The government claimed that any use of even an advisory jury contravenes the statute and congressional intent to have FTCA cases decided by the court without a jury.

Rule 39(c) of the Federal Rules of Civil Procedure states, in pertinent part, “[i]n an action
not triable of right by a jury, the court, on motion or on its own . . . may try any issue with an
advisory jury.”  The court found that it has the power to make use of an advisory jury in this case. Because of the purely advisory function that a jury empaneled under Rule 39(c) has, the use of an advisory jury is not precluded under 28 U.S.C. § 2402. The court concluded it will empanel a jury to hear the bellwether plaintiffs’ claims against the non-governmental defendants in the bellwether trials and will exercise its discretion to use that jury in an advisory capacity to hear the claims against the government in those same trials.

This advisory jury will not be asked or allowed to make a binding factual determination on the plaintiffs’ FTCA claims; instead, it will be allowed to hear the case and, through the verdict, advise the court, who will remain free to consider the same evidence and completely disregard such findings. The court determined that utilizing an advisory jury will alleviate jury confusion that would result if jurors are expected to listen to all the evidence against all the defendants - including FEMA - but then are instructed to ignore any evidence pertinent to the government.
 

 

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The judge handling the MDL involving the consolidated litigation involving Chinese manufactured drywall claims has issued a first order. Pursuant to Pretrial Order #1, the initial pretrial conference was set for July 9, 2009,  in the Courtroom of Judge Fallon. Earlier this summer, the U.S. Judicial Panel on Multidistrict Litigation agreed to consolidate a number of the suits in the U.S. District Court for the Eastern District of Louisiana. The suits have named as defendants the Chinese-based manufacturers, as well as importers, contractors, suppliers and others, including Knauf Gips KG, Knauf Plasterboard Tianjin Co., Taishan Gypsum Co., L&W Supply Corp., USG Corp. and Lennar Corp., the country’s second-largest home builder by volume.

The items listed in the Manual for Complex Litigation (Sections 22.6, 22.61, 22.62, and 22.63) were, to the extent applicable, set as a tentative agenda for the conference. (That may include adding parties, pleadings and motions, issue identification and development. ) Counsel were ordered to confer and seek consensus to the extent possible with respect to the items on the agenda, including a proposed discovery plan, any amendment of pleadings, consideration of any class action allegations and motions, and be prepared to select trial dates.

Plaintiffs and defendants were to submit to the Court before the conference a brief written statement indicating their preliminary understanding of the facts involved in the litigation and the critical factual and legal issues. (These statements will not be filed with the Clerk, will not be binding, will not waive claims or defenses, and may not be offered in evidence against a party in later proceedings.)

The Order covers a host of housekeeping issues for a new MDL. The Clerk will maintain a master docket case file under the style "In Re: CHINESE MANUFACTURED DRYWALL PRODUCTS LIABILITY LITIGATION” and the identification "MDL No. 2047 ".  All parties and their counsel were reminded of their duty to preserve evidence that may be relevant to this action. The duty extends to
documents, data, and tangible things in possession, custody and control of the parties to this
action, and any employees, agents, contractors, carriers, bailees, or other non-parties who possess materials reasonably anticipated to be subject to discovery in this action.

Prior to the initial conference, counsel for the plaintiffs and counsel for the defendant(s) were required to confer and seek consensus on the selection of a candidate for the position of liaison counsel for each group who will be charged with essentially administrative matters.

It is the Court’s intention to appoint a Plaintiffs’ Steering Committee (“PSC”) to conduct and coordinate the discovery stage of this litigation with the defendant’s representatives or committee.  The main criteria for membership in the PSC will be: (a) willingness and availability to commit to a time-consuming project; (b) ability to work cooperatively with others; and (c) professional experience in this type of litigation (d) willingness to commit the necessary resources to pursue this matter.

Behind the scenes, history suggests that a key issue underlying parts of the litigation the litigation will be whether the pollution exclusion applies. Insurers will likely argue that the alleged off-gassing of sulfur compounds from the Chinese drywall clearly constitutes the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of pollutants (referencing terms of the typical exclusion clause).  There is a split of authority on the scope of such a pollution clause.  Some states have narrow definitions which favor policyholders, while the more broad definitions in other jurisdictions typically favor insurers. Choice of law may be the determining factor on this.

One builder (Dragas Management) has already been named in a declaratory judgment action by its insurer, Builders Mutual Insurance Co.  In addition to relying on a pollution exclusion argument, insurers seem intent on showing that each installation of drywall constitutes a separate “occurrence” under the policy, and as such, a separate deductible would apply to each. Builders would undoubtedly prefer a single deductible for the installation within an entire development or project.

Concerns over the drywall have prompted legislators, including Sens. Nelson, D-Fla., and Landrieu, D-La., to introduce the Drywall Safety Act of 2009, which seeks to impose a recall and a temporary ban on imports until federal drywall safety standards are put in place.

 

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The Seventh Circuit has affirmed the entry of summary judgment in favor of the defendant in a toxic tort case arising from dry-cleaning chemicals. See Cunningham v. Masterwear Corp., 2009 WL 1751429 (7th Cir. 6/23/09).

The plaintiffs, Bill and Mary Ann Cunningham, alleged that after they moved their photo studio next to a dry-cleaning business operated by defendant, Masterwear Corp., they began developing severe headaches, and Mr. Cunningham developed a bad cough. In December 2003, the Indiana Environmental Protection Agency allegedly told them that the level of perchloroethylene (PCE) levels in the building could be significantly high and may pose a health concern over the long term.  Plaintiffs contended that the PCE vapors detected were the result of improper storage of chemicals by Masterwear.   When the Cunninghams went to sell the building (which they also had started living in) after learning about the alleged danger from PCE, they claim they had to sell it at well below market price because of the vapors.

Judge Richard A. Posner, writing for the panel, held that the plaintiffs' medical expert did not  establish that the level and duration of plaintiffs' exposure of PCE could have caused their symptoms.  The plaintiffs' expert, a respiratory doctor, had never treated a respiratory illness caused or aggravated by PCE.  He relied on a report that showed that PCE can cause respiratory symptoms and headaches, but the reported concentration levels were well above the dose that plaintiffs were exposed to. Readers of MassTortDefense know that the founding principle of toxicology is that the dose makes the poison. The expert did not present, either directly or by citation to a scientific literature, a theory that would link the level and duration of the exposure of the plaintiffs to PCE to their symptoms.

While the state of Indiana had set safe exposure levels for PCE, plaintiffs' expert had not been able to specify what risks or dangers led the state to choose the “safe level” it did. For example, if exposure at a certain level to a chemical caused birth defects; a person who was exposed to above that level of the chemical and developed asthma could not attribute this to his exposure.

Turning to proof of the economic injury, the alleged impairment of the value of the plaintiffs' property presents a separate issue -contamination can reduce property values without endangering anybody's health, observed the court. But like the health issue, "causation turns out to be the plaintiffs' Achilles heel," said the opinion.  Judge Posner affirmed the district's court finding that the testimony about what the real estate agent thought the property worth and what prospective buyers had told the agent would have been inadmissible hearsay.   Mr. Cunningham proposed to testify that he had to accept a much lower price than the $135,000 he was asking because prospective buyers were concerned about the building being contaminated. Although Indiana law allows a property owner to testify about the value of his property, that information must be based on sufficient facts within his personal knowledge. In this case, it was inadmissible hearsay to testify about what a real estate agent said, and what potential buyers allegedly told the real estate agent.  The plaintiffs did not provide any evidence on the “critical question” related to their property value, i.e., how much they could have sold the building for had it not been for the contamination. What the owner is not allowed to do is merely repeat another person's valuation.

 

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In what appears to be the first substantive decision to come out of the multiple suits alleging that a pain pump medical device damages patients, a federal court has granted summary judgment to the defendant. Kilpatrick v. Breg, Inc., No. 4:08-cv-10052 (S.D. Fla. 6/26/09). Judge Michael Moore ruled in favor of medical device manufacturer Breg, finding that the plaintiff, who alleged damage to his shoulder cartilage, did not provide enough reliable expert evidence to link the condition to the defendant's shoulder pain pump.

Plaintiff Kilpatrick underwent arthroscopic shoulder surgery in 2004 after an orthopedic specialist discovered a tear in his shoulder socket.  To help with post-operative pain, the surgeon inserted a pain pump into plaintiff's shoulder, which would allow the doctor to administer an anesthetic via a catheter in the patient's arm. The surgeon injected bupivacaine into the pump's attached catheter and further filled it with 100 cc's of anesthetic, which was to be delivered into Kilpatrick's shoulder over the next 48 hours.  Plaintiff alleges that he began experiencing severe pain in his shoulder in 2006. An orthopedic surgeon diagnosed the pain as glenohumeral chondrolysis, a deterioration of the cartilage, and Kilpatrick underwent shoulder replacement surgery. He then brought suit, alleging negligence, strict products liability, and violations of Florida's Deceptive and Unfair Trade Practices Act.  Kilpatrick claimed that using the Breg pain pump to administer local anesthetic directly into his shoulder joint caused him to develop post-arthroscopic glenohumeral chondrolysis.

The reliability prong of the Rule 702 analysis was the central issue.  Breg argued, and plaintiff apparently did not contest, that the case should be treated like a toxic tort case for purposes of the Daubert inquiry, in that plaintiff had to offer proof of both general and specific causation. “If anything, determining causation in this case requires an even more complex logical chain than the typical toxic tort case, because the key issue is not merely whether a chemical compound could and did cause injury, but whether that compound as delivered via a particular medical device inserted in a particular location (within Kilpatrick's shoulder joint) could and did cause injury,” the court found.

The summary judgment motion focused first on general causation, and the ability of plaintiff's expert to opine adequately under Daubert that the device can cause this type of injury.  The causes of chondrolysis remain disputed, and experts in the medical community have pointed to autoimmune deficiencies, certain kinds of sutures, thermal energy procedures and contrast dyes made from gentian violets as possible risk factors.  Plaintiff's expert admitted it was a still developing science.

Plaintiff's expert relied on several published studies to attempt to show causation, which were not directly on point, and the Court found that his extrapolations from the studies were not warranted either.  None of the articles were based on controlled, randomized epidemiological studies of human beings, which are the best evidence. “Significantly, none of the articles explains the mechanism by which bupivacaine damages cartilage, each has important limitations that Poehling does not take into account, and none of them offers an ultimate conclusion as to the general causation of glenohumeral chondrolysis,” the court noted. At most they suggest a possible association.  Association is not causation.  As for the animal studies, the expert did not explain the possible differences in dose-response relationship between humans and rabbits, an important factor to consider in evaluating whether an alleged exposure caused an adverse effect. 

As to specific causation, as is typical of many plaintiff experts, Poehling described a process of so-called "differential diagnosis," trying to rule out other suspected causes such as thermal energy and gentian violet, the contrast dye sometimes used during arthroscopic surgery. This approach cannot, observed the court, make up for a fundamental lack of adequate proof about the general toxicity of the substance.  To "rule in" one cause, even while ruling out other causes, requires a sufficient general causation proof.  At its base, however, the conclusion on specific causation still would be unreliable, the court said, as it was "ultimately rooted in nothing more than temporal relationship.”   That before/after focus is not the basis of good science, the court said, “and Poehling's dependence upon it further weakens the reliability of his methodology.”  Significantly, the expert had not offered a sufficient explanation of the background risk for genohumeral chondrolysis, casting further doubt on the reliability of the chosen method. He admitted that not only the pain pump — as a kind of drug delivery system — could have caused the injury, but also the anesthetic delivered via the pain pump.  Poehling's concession that the current state of medical literature is still unsettled about the cause of the plaintiff's condition seriously undermines the reliability of his methodology, the court concluded.  His methodology had no known rate of error, and thus all he had was a hypothesis that “may be exactly right,” but that currently is “merely plausible, not proven.”

It will be interesting to see what impact the approximately 300 suits pending against pain pump manufacturers in state and federal courts.   

 

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In the multidistrict product liability litigation over "Stand ‘n Seal," a federal judge is allowing, over plaintiffs' objections, testimony from the defendants' causation experts.  Judge Thomas W. Thrash of the U.S. District Court for the Northern District of Georgia has ruled that three experts, who opined that Stand ‘n Seal does not emit sufficient amounts of the chemical which plaintiffs allege caused their injuries, including chemical pneumonitis, may testify. In Re Stand ‘N Seal Products Liability Litigation, MDL NO. 1804 (N.D. Ga.).

Plaintiffs in the roughly 200 personal injury actions in the MDL assert that Stand ‘n Seal  manufactured with Flexipel S-22WS caused respiratory problems. Stand ‘n Seal is a consumer product used to seal ceramic tile grout in kitchens, bathrooms, and similar areas. The advertised advantage of Stand ‘n Seal was that users can easily stand and spray the sealant onto the grout without the strain of using a brush and manually applying the sealant. The plaintiffs say that the
problems with Stand ‘n Seal began when the manufacturer changed its chemical components to include Flexipel.

Part of the defense has been the dose-response issue that plaintiffs could not have inhaled a harmful amount of the chemical while using Stand ‘n Seal as directed. The plaintiffs urged the court to exclude this expert testimony of Drs. Mark Rigler, William Longo, and Mitchell Sauerhoff.  Rigler and Longo, industrial hygiene experts, tested samples of Stand ‘n Seal and concluded that plaintiffs did not inhale an “analytically detectable” concentration of Flexipel, the specific chemical at issue.  They did not, contrary to plaintiffs' arguments, opine that users of Stand ‘n Seal had absolutely no exposure to Flexipel.  Instead, they have said that users of Stand ‘n Seal were not exposed to “any significant” or “analytically detectable” amounts of Flexipel. In other words, there is a range between zero and the detection limit of their testing, but they believe that range is insignificant.

Instead, said the defense experts, the users of Stand ‘n Seal had a much higher probability of inhaling significant levels of Isopar-G, a solvent used in various formulations of grouting. Defendants intend to offer expert testimony from Mitchell Sauerhoff that overexposure to Isopar-G can cause respiratory injury.  Judge Thrash concluded that the experts’ opinions were admissible. 

“The plaintiffs' experts disagree with Sauerhoff’s opinions, but that disagreement by itself does not make Sauerhoff’s or Rigler and Longo’s testimony inadmissible.”  The court noted that "none of these [potential alternative] explanations seems especially conclusive."  But the alleged generality of the defense experts’ alternate explanations for the cause of the plaintiffs’ injuries affect the weight, not the admissibility, of the expert testimony.”   MassTortDefense notes that plaintiffs often forget that the defendant does not have the burden to disprove causation.  So defense evidence of alternative causes can be admissible even if such evidence would be insufficient when offered by a plaintiff who has the burden of proof on causation.

 

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The federal judge presiding over the MDL involving litigation claiming trailers issued after Hurricane Katrina allegedly exposed residents to formaldehyde has declined to dismiss government contractors that hauled and installed the trailers.  In re  FEMA Trailer Formaldehyde Products Liability Litigation, MDL No. 1873 (E.D. La.).  Judge Engelhardt rejected the motion of Shaw Environmental Inc. and CH2M Hill Constructors, Inc. to be dismissed from a multiple-plaintiff case in the trailer MDL.  The court rejected the contractors' arguments that the plaintiffs lacked standing;  he also rejected the contractors'  argument that the FEMA trailer residents failed to plead claims cognizable under the Louisiana Products Liability Act.

The plaintiffs in this case are Louisiana residents who had lived in trailers issued by the Federal Emergency Management Agency. They sued the makers and distributors of FEMA trailers
in November, 2007. Then in early 2009, the plaintiffs added trailer haulers and installers,
Shaw and CH2M Hill, as defendants.

The contractors argued first that the plaintiffs lacked standing because they had failed to link  particular plaintiffs to any particular defendant involved in their specific unit.  The court ruled that because the original complaint matched plaintiffs to trailer manufacturers, those originally named plaintiffs had standing to add defendants in the chain of distribution. Those plaintiffs who failed to assert any linkage at all were dismissed without prejudice.

Second, the contractors argued prescription, the Louisiana version of laches, asserting that the plaintiffs' products liability claims prescribed on May 18, 2007, or one year after the first trailer suit was filed. The contractors claimed that the plaintiffs should have known about their claim for formaldehyde exposure by that date. Judge Engelhardt, however, ruled that the clock started from the date of injury, and it is impossible to determine in advance exactly when each plaintiff became aware of his or her injuries.

"What each ... plaintiff knew about formaldehyde exposure or the possibility of legal claims relating thereto; what injury each such plaintiff allegedly experienced from such exposure, and when knowledge of these alleged injuries occurred, are questions that can be answered only a case-by-case basis. These facts are not evident from the face of the complaints,” Judge Engelhardt wrote.

Finally, Judge Engelhardt rejected the contractors contention that the state product liability act did not apply to them because they were not manufacturers of the trailers.  While Louisiana law determines that the proper assembly of a defective part does not create manufacturer liability, here, in contrast, plaintiffs contended that the alleged formaldehyde-related defect occurred in part because of the assembly process used by the contractors.  An alleged defect which manifests itself in the assembly process can impose Louisiana Products Liability Act "manufacturer" liability on a party when the defect is created by the assembly process, he concluded.

Readers will recall that last December, the court properly refused to grant class certification to the six proposed subclasses of plaintiffs in this MDL, finding they did not meet the standards required for class certification under Rule 23. The plaintiffs had sought certification of four state subclasses of individuals who resided in trailers provided by the Federal Emergency Management Agency in Louisiana, Texas, Alabama and Mississippi following hurricanes Katrina and Rita, as well as a future medical monitoring subclass, and an economic loss subclass.  And the court has begun selecting bellwether cases for the first trials.

 

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The U.S. Supreme Court has ruled that an injunction against lawsuits in the landmark bankruptcy case of asbestos manufacturer Johns-Manville does in fact bar claims now asserted by asbestos plaintiffs against the company’s insurer, Travelers Indemnity Co.  In a 7-2 decision, the Supreme Court reversed an opinion by the U.S. Court of Appeals for the Second Circuit, ruling that a bankruptcy judge properly interpreted the 1986 injunction to apply to the later claims.

MassTortDefense alerted readers to this case late last year. The case arises from the now-decades old Manville bankruptcy. From the 1920s until the 1970s, Johns-Manville was the largest manufacturer of asbestos-containing products and the largest supplier of raw asbestos in the United States. As a result, in the 1960s and 1970s, Johns-Manville became the target of many product liability suits. Johns-Manville filed for Chapter 11 protection under the federal bankruptcy law on Aug. 26, 1982. On that date, Johns-Manville was a defendant in more than 12,500 asbestos-related suits. To fund its reorganization plan, the bankruptcy court allowed Johns-Manville to settle its insurance claims for about $850 million.

Travelers, Johns-Manville's primary insurer from 1947 to 1976, paid about $100 million into the bankruptcy estate in exchange for a full and final release of Manville-related claims. In 1986, Bankruptcy Judge Lifland entered a series of confirmation orders, inter alia barring any person from commencing any actions based upon, arising out of, or related to insurance policies that Travelers issued to Manville. In 2004, Judge Lifland found that his injunction was being violated by a new species of asbestos-related lawsuits (referred to by some as “direct action” claims) against insurers. These new asbestos claims were part of a global strategy developed by the plaintiffs' bar to put insurers in Manville's shoes and thereby hold them liable on account of their insurance relationship with Manville. The injunction in the meantime had become the model for a statutory change adopted as part of the Bankruptcy Reform Act of 1994, establishing Section 524(g) of the Bankruptcy Code, which expressly authorized the Manville approach to be used in future asbestos bankruptcies.  So the attacks had potentially widespread significance.

The Second Circuit, rather than enforce the confirmation order as it was originally written, which had been affirmed on a prior appeal, ruled that Judge Lifland had exceeded the “subject matter jurisdiction” granted by the bankruptcy code. In re: Johns-Manville Corp., 517 F.3d 52 (2d Cir. 2008). The Second Circuit concluded that the bankruptcy court in 1986 was without power to enjoin all claims that literally arise out of the insurance policies that Manville purchased from Travelers. Thus, the bankruptcy court had also exceeded its authority in approving a multi–million dollar settlement of asbestos claims filed against Travelers. The appeals court said the bedrock issue in this case required a determination as to whether the bankruptcy court had jurisdiction over the disputed statutory and common law claims. While the bankruptcy court repeatedly used the terms “arising out of” and “related to,”  global finality for Travelers is only as global as the bankruptcy court's jurisdiction.

The Supreme Court, however, held "that the terms of the injunction bar the actions and that the finality of the bankruptcy court’s orders following the conclusion of direct review generally stands in the way of challenging the enforceability of the injunction.” Justice David Souter wrote for the majority. The 1986 Orders became final on direct review over two decades ago, and whether the Bankruptcy Court had jurisdiction and authority to enter the injunction in 1986 was not properly before the Court of Appeals in 2008. 

The respondents' position that the 1986 Orders only bar actions against insurers when those actions seek to recover derivatively for Manville’s wrongdoing, but not actions to recover for Travelers’ own alleged misconduct, simply is not what the 1986 Orders say. There is no language limiting it to derivative claims.  The Bankruptcy Court in this case plainly had jurisdiction to interpret and enforce its own prior orders, in part because it explicitly retained jurisdiction to enforce its injunctions.  Once the 1986 Orders became final on direct review (whether or not proper exercises of bankruptcy court jurisdiction and power), they became res judicata to the parties and those in privity with them, not only as to every matter which was offered and received to sustain or defeat the claim or demand, but as to any other admissible matter which might have been offered for that purpose. Those orders are not any the less preclusive because the attack is on the Bankruptcy Court’s conformity with its subject-matter jurisdiction, for even subject-matter jurisdiction generally may not be attacked collaterally.

The Court stated that "our holding is narrow."  They did not resolve whether a bankruptcy court, in 1986 or today, could properly enjoin claims against non-debtor insurers that are not derivative of the debtor’s wrongdoing. Still an important issue in a mass tort driven bankruptcy.  Nor did the Court decide whether any particular respondent is bound by the 1986 Orders.   Thus, the Court appeared to be making an effort not to address the actual underlying issue here.

In a dissenting opinion, however, Justices John Paul Stevens and Ruth Bader Ginsburg
sided with the Second Circuit, arguing that the bankruptcy court had exceeded its jurisdiction by barring the suits. 

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The U.S. Judicial Panel on Multidistrict Litigation has consolidated a number of lawsuits brought over Chinese-made drywall installed in U.S. homes. See In re: Chinese-Manufactured Drywall Products Liability Litigation, MDL-2047 (JPML).

The motion for consolidation encompassed ten actions, four actions in the Southern District of Florida, three actions in the Middle District of Florida and one action each in the Northern District of Florida, Eastern District of Louisiana, and Southern District of Ohio. The panel said it was aware of 67 related lawsuits that were pending in federal courts around the country. Those suits and any other related actions will be treated as potential tag-along actions.

The Panel found that all actions share factual questions concerning drywall manufactured in China, imported to and distributed in the United States, and used in the construction of houses; plaintiffs in all actions allege that the drywall emits smelly, corrosive gases. Centralization under Section 1407 will eliminate duplicative discovery, including any discovery on international parties; prevent inconsistent pretrial rulings, particularly those with respect to class certification issues; and conserve the resources of the parties, their counsel and the judiciary, said the Panel.

As is sometimes the case, no district was a clear focal point of this litigation. The common manufacturing defendant and its affiliates are foreign entities without a major presence in any of the suggested transferee districts. Most actions also name local entities, such as builders and suppliers, as defendants. Several parties suggested different districts, and all of the suggested districts, particularly those in the southeastern region, have a nexus to the litigation through allegedly affected houses built with the drywall at issue. On balance, the panel was persuaded that the Eastern District of Louisiana is a preferable transferee forum for this litigation. Centralization in this district permits the Panel to effect the Section 1407 assignment to a judge who has "extensive experience in multidistrict litigation as well as the ability and temperament to steer this complex litigation on a steady and expeditious course." That would be the Honorable Eldon E. Fallon of the Eastern District of Louisiana.

As posted on MassTortDefense before, the lawsuits allege that sulfur compound levels in the drywall are too high, causing issues with air conditioning systems, electrical appliances, internal wiring and other electrical systems in homes. Plaintiffs also allege the drywall produces a rotten egg-like stench and causes a variety of respiratory and other health problems for those who live in the affected homes. The lawsuits filed so far have named Chinese-based manufacturers, as well as importers, developers and builders, contractors, suppliers and others. Companies facing suits include Knauf Gips KG, Knauf Plasterboard Tianjin Co., Taishan Gypsum Co., L&W Supply Corp. and USG Corp. Lennar Corp., a major home builder, has brought in more than 20 manufacturers, suppliers and installers.  Some legislators have been critical of the CPSC's handling of the issue.  And bills have been introduced to ban the product.

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The U.S. Food and Drug Administration has reportedly agreed to take a further look at its 2008 decision that bisphenol A in certain food and drink containers doesn't pose a significant safety threat. Newly appointed FDA Commissioner Margaret Hamburg is reported to have put the agency's acting chief scientist in charge of the review, which could take 3-6 months. In her first appearance before Congress as commissioner, Hamburg told the House Energy and Commerce Subcommittee on Health that the FDA is re-examining its position on BPA.

Reps. Henry Waxman, D-Calif., and Bart Stupak, D-Mich., sent a letter to the FDA earlier this month asking the agency to revisit its earlier conclusion. The Committee on Energy and Commerce and its Subcommittee on Oversight and Investigations have been investigating the possible risks of the chemical BPA in consumer products and food product containers, particularly in infant formula containers and other items used by infants and children. The Congressmen pointed to the October, 2008, report of FDA's advisory Science Board Subcommittee, which raised questions about some data aspects of the agency's conclusion. "Based on this information, we request that FDA reconsider the Bush Administration's position that BPA is safe at current estimated exposure levels," said the letter.

In addition to their letter to the FDA, the legislators sent a request to the North American Metal Packaging Alliance, an industry group, creating a straw man about alleged tactics the industry might contemplate using in a future hypothetical public relations strategy to counter efforts to ban BPA. The duo requested a list of all attendees at group meetings, including their affiliations and contact information, certainly a chilling attack on the trade group member's right to free speech and freedom of association.

As reported here at MassTortDefense, FDA had already decided to support additional research with regard to its analysis of BPA safety in plastic baby bottles and food and drink containers. The FDA’s basic position remains that current human exposure to BPA in food-packaging materials provides an adequate margin of safety. FDA has been re-evaluating available data and planning for the acquisition of additional data that will strengthen the exposure estimates from all dietary sources of BPA, with particular attention to dietary sources relevant to infants and children.

Makers of BPA say that the chemical poses no known risk to human health at current exposure levels. In response to public demand, some manufacturers have begun introducing products for infants and children that are BPA-free. The Environmental Protection Agency has calculated that adults and infants can consume 50 micrograms of BPA per kilogram of body weight every day over a lifetime with little appreciable risk of harm.  But Democrats have introduced bills in Congress to ban the chemical.

 

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The federal court overseeing the MDL involving trailers issued by the U.S. government following Hurricane Katrina has dismissed some of the plaintiffs' state law claims against mobile home manufacturer defendants, on the basis of the federal preemption doctrine. In Re: FEMA Trailer Formaldehyde Products Liability Litigation, MDL No. 1873 (E.D. La.)

As readers of MassTort Defense know, Hurricane Katrina impacted much of the Gulf Coast in August 2005, and Hurricane Rita followed in September 2005, causing extensive damage along the Louisiana and Texas coasts. In the wake of the hurricanes, many individuals whose homes were lost or damaged moved into temporary housing provided by FEMA. Plaintiffs allege that these trailers exposed residents to high levels of the chemical formaldehyde, about which they were not warned. The Judicial Panel on Multidistrict Litigation consolidated a number of suits against defendants, including the federal government and several trailer manufacturers, over the alleged formaldehyde exposure in 2007.

Judge Kurt Engelhardt of the U.S. District Court for the Eastern District of Louisiana last week granted the manufacturer defendants' motion to dismiss certain state law claims. The defendants asserted that the construction of these mobile homes was regulated by the Manufactured Home Construction and Safety Standards Act, 42 U.S.C. § 5401 et seq., (“the MHA”) and the regulations promulgated by the United States Department of Housing and Urban Development (“HUD”), pursuant to 24 C.F.R. § 3280 and § 3282 (“the HUD Code”). Pursuant to the MHA, HUD established the Manufactured Home Construction and Safety Standards (“MHCSS”), 24 C.F.R § 3208 et seq., which govern the standards for formaldehyde emissions from materials used in manufactured homes. This regulation expressly and specifically dictates the maximum level of formaldehyde gas that component products in mobile homes can emit. The regulations also specify that a health notice on formaldehyde emissions shall be temporarily displayed in the kitchen of each manufactured home.Accordingly, the defendants asserted that the federal statutes and regulation in the MHA and the HUD Code explicitly and impliedly preempt plaintiffs’ state law claims against them.

As several courts have previously noted, the MHA does not explicitly preempt state causes of action. Turning to implied preemption, the court noted that implied preemption exists when state law regulates conduct in a field Congress intended the Federal Government to occupy exclusively (also referred to as “field preemption”), or when state law actually conflicts with federal law (also referred to as “conflict preemption”). Conflict preemption exists in two scenarios: (1) when compliance with both a state and federal law is impossible, and/or (2) when the state law conflicts with the federal law such that it stands as an obstacle to the achievement of the federal law’s purposes and objectives.

After analyzing the statute and regulations, the MDL court concluded that if plaintiffs in the instant case were allowed to go forward with their state product liability claims raising the ambient air standard, then defendants in the mobile home industry would essentially be required to deviate (in ways variable from state to state) from those federal standards so carefully and thoroughly crafted by HUD. The MHA clearly states that if states want to regulate safety matters that federal law already covers (like formaldehyde emissions), those regulations must be “identical.” 42 U.S.C. § 5403(d). Furthermore, it was noteworthy that the plaintiffs contend that the moving defendants should have adhered to the ambient air standard, which differs from the HUD-accepted component products standard. Thus, cases that present situations where the plaintiffs are not arguing that the defendants should have adhered to a standard higher than, or different from what the MHA imposes, are inapplicable.

The court concluded similarly that any such claims relating to inadequate warnings of exposure
to purportedly high levels of formaldehyde contained in the units, that require more than the federal
label standards, should be dismissed. However, any of plaintiffs’ state law claims that advance non-compliance with federal formaldehyde regulations (to the extent that such claims exist) are considered to be parallel claims, are not preempted and, thus, are not dismissed. See Riegel v. Medtronic, Inc., 128 S.Ct 999, 1011 (2008).

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A new report from the Project on Emerging Nanotechnologies argues that existing health and safety agencies are unable to cope with the risk assessment, standard setting, and oversight challenges of advancing nanotechnology. The new report, Oversight of Next Generation Nanotechnology, says the nation needs a new agency to deal with the health and environmental impacts of these technically complex products promised by rapid 21st century scientific advances.

Nanotechnology involves working at the scale of single atoms and molecules. The U.S. government defines nanotechnology as “the way discoveries made at the nanoscale are put to work.” The nanoscale is roughly 1–100 nanometers. There are 25.4 million nanometers in an inch and 10 million nanometers in a centimeter.

Nanoscale materials often behave differently than materials with a larger structure do, even when the basic material (e.g., silver or carbon) is the same. Nanomaterials can have different chemical, physical, electrical, and biological characteristics. For example, an aluminum can is perfectly safe, but nano-sized aluminum is explosive.

The novel characteristics of nanomaterials mean that risk assessments developed for ordinary materials may be of limited use in determining the health and environmental risks (and thus product liability and mass tort risks) of the products of nanotechnology. A body of literature speculates about the potential for unusual health and environmental risks given that nanometer-scale particles can get to places in the environment and the human body that are inaccessible to larger particles. Nanomaterials have a much larger ratio of surface area to mass than ordinary materials do. It is at the surface of materials that biological and chemical reactions take place, and so some expect nanomaterials to be more reactive than bulk materials.

The report explains that almost all the current applications of nano are “passive,” in that they involve adding a nanomaterial to an ordinary material as a way of improving performance. For example, adding carbon nanotubes to rubber can greatly increase the toughness of the rubber without reducing its flexibility. Passive nanotechnology applications thus include using materials like carbon nanotubes, silver nanoparticles and porous nanomaterials to add functionality to products by nature of their physical and chemical form, rather than by how they respond to their environment.

Second generation, "active" nanostructures, typically involve nanometer-scale structures that change their behavior in response to changes in their environment. These changes might come about as a result of a mechanical force, a magnetic field, exposure to light, the presence of certain biological molecules or a host of other factors.

A good deal of research, involving a variety of different nanotechnologies, is being devoted to cancer detection and cure. One of the main goals of using nanotechnology for medical purposes, observes the report, is to create devices that can function inside the body and serve as drug delivery systems with specific targets. Another hot area: researchers are exploring the use of nanomaterials and nanotechnology techniques to vastly improve computers.

Even the first-generation nanotechnologies challenge traditional risk assessment methods, argues the report. Multiple characteristics contribute to the potential toxicity of many nanomaterials; they include not just mass or number of particles but also the shape of the particles, the electrical charge at the particle surface, the coating of the particle with another material and numerous other characteristics. Science has yet to determine which of these characteristics are most important under what circumstances.

After describing the current regulatory regime, the paper calls for a more unitary regulatory approach, including a new Department of Environmental and Consumer Protection to oversee product regulation, pollution control and monitoring, and technology assessment.
 

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The Consumer Product Safety Commission has issued a report on the imported drywall situation, noting that nearly 200 consumers from at least 13 States and the District of Columbia have reported health symptoms or certain metal corrosion problems in their homes that may be related to drywall imported from China. (CPSC says it is still investigating the scope of the drywall problem, working to identify the links from foreign manufacturers to the U.S. consumers in consultation with the Chinese government and the U.S. Customs and Border Protection.)

The update comes on the heels of criticism by Senator Nelson (D. Fla.) of how quickly the CPSC was moving. The agency, together with the Environmental Protection Agency and the Department of Health and Human Services, is looking at charges of health symptoms or the corrosion of certain metal components in their homes allegedly related to the presence of drywall produced in China. The majority of the reports to the CPSC have come from consumers residing in Florida while others have come from consumers in Louisiana, Virginia, Wisconsin, Ohio, Alabama, Mississippi, Missouri, California, Washington, Wyoming, the District of Columbia, Arizona, and Tennessee. Consumers largely report that their homes were built in 2006 to 2007, when an unprecedented increase in new construction occurred in part due to the hurricanes of 2004 and 2005.

The judicial panel on multidistrict litigation recently agreed to consider consolidating the
more than 30 federal lawsuits filed so far over the drywall.The lawsuits so far name Chinese-based manufacturers, as well as importers, developers and builders, contractors, suppliers and others.

Common features of the reports submitted to the CPSC from homes believed to contain
problem drywall have been:
• “rotten egg” smell within their homes.
• health concerns such as irritated and itchy eyes and skin, difficulty in breathing, persistent cough, bloody noses, runny noses, recurrent headaches, sinus infection, and asthma attacks.
• blackened and corroded metal components in their homes and the frequent replacement of components in air conditioning units.

The federal government is working on an (1) evaluation of the relationship between the drywall and the reported health symptoms; (2) evaluation of the relationship between the drywall and electrical and fire safety issues in the home; and (3) the tracing of the origin and distribution of the drywall. One obvious challenge has been figuring out how much problem drywall there is in any house, given that it is already installed, likely painted and may not be clearly marked.

On the health side, the most frequently reported symptoms are irritated and itchy eyes and skin, difficulty in breathing, persistent cough, bloody noses, runny noses, recurrent headaches, sinus infection, and asthma attacks. Some of these symptoms are similar to colds, allergies or reactions to other pollutants sometimes found in homes. As such, it is difficult to determine if the reported symptoms are related to the drywall and not any other environmental factors or pollutants in the home.

Data being gathered include from in-home air sampling; laboratory elemental characterization studies of domestic and imported drywall; and laboratory chamber studies of domestic and imported drywall to separate and isolate chemical emissions from drywall as opposed to chemicals emitted from other home products (e.g., carpets, cleaners, paint,adhesives, beauty products).

If a house has “problem” drywall, the CPSC is recommending that consumers with health issues consult a physician as soon as possible; those with any of the electrical or fire safety concerns should consult the local gas or electric supplier and a licensed electrician or building inspector as soon as possible. Consumers are cautioned to beware of unqualified testing and remediation services already seeking to o take advantage of consumers struggling to address this issue.

CPSC admits it could be months before it can confidently address the scientific relationships, if any, between the problem drywall and the health and safety concerns raised by consumers.
 

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A federal appeals court has reinstated a suit in which a Tennessee plaintiff alleged his exposure to a pool cleaner caused him to lose his sense of smell. The 6th Circuit found that the trial court had improperly excluded his medical expert from testifying. Best v. Lowe's Home Centers Inc., 2009 WL 1010883 (6th Cir.  4/16/09).

Of great interest to readers of MassTortDefense is the court’s treatment of the concept of differential diagnosis. This diagnostic method has long been used by treating physicians to assess what ails a patient, and it involves a logical process of ruling in and ruling out possible diagnoses based on symptoms, test results, and other medical evidence. The process has been hijacked by plaintiff experts to offer an aura of reliability to opinions not only about the diagnosed injury, but the cause of the injury. Plaintiff experts may make no effort to establish why a cause is even on the list to be ruled out (assuming general causation), and may rule out potential alternative causes with far less rigor than doctors would exclude alternative diagnoses in the real world.

Plaintiff in Best claimed to suffer from permanent loss of his sense of smell as a result of a pool chemical spilling onto his face and clothing at a Lowe's Home Center store. Best planned to introduce the expert testimony of Dr. Francisco Moreno, a board-certified otolaryngologist, in order to establish the causal link between the chemical spill and his injuries. The district court excluded Dr. Moreno's testimony, holding that the method employed by the doctor in drawing his conclusions regarding causation was “unscientific speculation.” This resulted in summary judgment.

In summary, because of the temporal relationship between Best's exposure to the chemical and the onset of his symptoms, in conjunction with an effort to eliminate other possible causes of anosmia, Dr. Moreno formed the opinion that the inhalation of the Aqua EZ caused Best to lose his sense of smell. The 6th Circuit stated that Dr. Moreno thus employed a “differential diagnosis” methodology in forming his opinion. Differential diagnosis is, according to the court, the method by which a physician determines what disease process caused a patient's symptoms. The physician considers all relevant potential causes of the symptoms and then eliminates alternative causes based on a physical examination, clinical tests, and a thorough case history. Hardyman v. Norfolk & W. Ry. Co., 243 F.3d 255, 260 (6th Cir.2001). The court was less than precise in its treatment of the slippery slope between causation of symptoms (what disease is causing the symptoms) to causation of disease (what toxic exposure caused the disease that caused the symptoms).

Dr. Moreno formed his opinion regarding Best's alleged loss of his sense of smell by considering a list of the possible causes of such an injury, including virus, accident, tumor, surgery, or exposure to chemicals, as well as Best's use of medications. He noted that the chemical was quite concentrated, and relied on Best's report that the material splashed onto his face and clothing. Dr. Moreno ruled out medications as the cause, based on his knowledge of the side effects.

The 6th Circuit said it recognizes differential diagnosis as an appropriate method for making a determination of causation for an individual instance of disease. Differential diagnosis is considered to be “a standard scientific technique of identifying the cause of a medical problem by eliminating the likely causes until the most probable one is isolated.” Hardyman, 243 F.3d at 260 (quoting Westberry, 178 F.3d at 262).

But the court did note that not every opinion that is reached via a differential-diagnosis method will meet the standard of reliability required by Daubert. To determine which opinions do and do not, the court adopted the reasoning of the Third Circuit in In re Paoli Railroad Yard PCB Litigation, 35 F.3d 717 (3d Cir.1994).  A medical causation opinion in the form of a doctor's differential diagnosis is reliable and admissible where the doctor (1) objectively ascertains, to the extent possible, the nature of the patient's injury, (2) “rules in” one or more causes of the injury using a valid methodology, and (3) engages in standard diagnostic techniques by which doctors normally rule out alternative causes to reach a conclusion as to which cause is most likely. In connection with the third “rules out” prong, if the doctor engages in very few standard diagnostic techniques by which doctors normally rule out alternative causes, the doctor must offer a good explanation as to why his or her conclusion remains reliable. Similarly, the doctor must provide a reasonable explanation as to why he or she has concluded that any alternative cause suggested by the defense was not the sole cause.
 

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Sen. Bill Nelson, D-Fla., has sent a letter to the President calling for the resignation of the current head of the U.S. Consumer Product Safety Commission, and criticizing the agency for its response to reports of Chinese-made tainted drywall installed in U.S. homes.

In a letter addressed to President Obama earlier this month, the senator targeted the CPSC for failing to do enough, in his view, to halt the import of the drywall. Readers will recall that residents claim this product emits a sulfur smell, poses health risks, and also causes electrical problems.

Nelson asserted that the "agency is doing too little, too late to help residents of Florida and other states who are reporting serious health and safety problems associated with living in homes built with tainted drywall imported from China.”  The CPSC reports that it has launched a formal compliance investigation to determine any risk associated with the sulfur-based gases that may be emitted from the imported drywall

Nelson is also a sponsor of the Drywall Safety Act of 2009, which seeks to impose a recall and a temporary ban on imports until federal drywall safety standards are put in place to protect consumers. The legislation also calls for the CPSC to perform a study with the EPA to determine the level of risk posed by the substances in the drywall.

Products litigation has ensued, including a proposed class action was filed in the U.S. District Court for the Middle District of Florida. According to that suit, a shortage of drywall made in the U.S. caused many builders to use imported Chinese drywall during Florida's pre-recession construction boom earlier this decade. There has also been speculation that some of that drywall may have been kept at sea waiting to enter U.S. ports, and was thus exposed to excessive moisture/humidity that caused the alleged fume problems. Such claims are typically inappropriate for class certification because of the individual issues that will be presented by evidence surrounding injury and causation. And at least one U.S. home builder has sued more than two dozen manufacturers, suppliers and installers of drywall imported from China.
 

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Two bills are pending in the Texas legislature to overturn a significant toxic tort decision made by the state's highest court. In Borg-Warner Corp. v. Arturo Flores, 232 S.W.3d 765 (Tex.2007), the court required plaintiffs to prove they had a sufficient level of exposure to the toxic substance, asbestos.

Earlier in April, a committee of the Texas Senate approved by a 6-2 vote a bill relating to the
standard of causation in claims involving mesothelioma caused by exposure to asbestos
fibers. The bill, S.B. 1123, introduced by Sen. Robert Duncan, R-Lubbock, would require a plaintiff to prove that a defendant ’s product or conduct was a substantial factor in causing the exposed claimant ’s injury by presenting qualitative proof that the asbestos exposure attributed to the defendant was substantial, and not merely de minimis, when considering (1) the frequency of the exposure;  (2) the regularity of the exposure; and (3) the proximity of the claimant to the source of the asbestos fibers.  A plaintiff would not be required to prove numerically the dose, approximate or otherwise, of asbestos fibers to which the claimant was exposed that are attributable to the defendant.

A House bill, introduced by Rep. Craig Eiland, D-Texas City, is still pending in committee. H.B. 1811 would require proof that the defendant ’s product or conduct was a substantial factor in causing the exposed person ’s injury, by showing that the exposure to the asbestos fibers for which that defendant is alleged to be responsible contributed to the cumulative exposure of the exposed person and was more than purely trivial when considering the following (same) qualitative factors: (1) the frequency of exposure; (2) the regularity of exposure; and (3) the proximity of the exposed person to the source of the asbestos fibers. Plaintiff need not prove, for any purpose, a quantitative dose, approximate quantitative dose, or estimated quantitative dose of asbestos fibers to which the exposed person was exposed.

Such language would significantly lower the standard for providing causation in mesothelioma litigation. Perhaps the most widely cited standard for proving causation in asbestos cases is the Lohrmann “frequency, regularity, and proximity” test. Lohrmann v. Pittsburgh Corning Corp., 782 F.2d 1156 (4th Cir.1986). The court there rejected a standard that if the plaintiff can present any evidence that a company's asbestos-containing product was at the workplace while the plaintiff was at the workplace, a jury question has been established as to whether that product proximately caused the plaintiff's disease. Instead, the court concluded that to support a reasonable inference of substantial causation from circumstantial evidence, there must be evidence of exposure to a specific product on a regular basis over some extended period of time in proximity to where the plaintiff actually worked.

While the test seemed to be tighter standard than the plaintiffs’ proposed test, since a plaintiff must prove more than a casual or minimum contact with the product, in reality the test has loosened the traditional standards for substantial factor causation. In Borg-Warner, the court held that a “frequency, regularity, and proximity” test does not, in itself, capture the role of causation as an essential predicate to liability. As in many jurisdictions, the word “substantial” in substantial factor is used to denote the fact that the defendant's conduct has such an effect in producing the harm as to lead reasonable people to regard it as a cause, using that word in the popular sense, in which there always lurks the idea of responsibility, rather than in the so-called philosophic sense, which includes every one of the great number of events without which any happening would not have occurred.

Substantial factor in a toxic tort case cannot be analyzed without recognizing that one of toxicology's central tenets is that “the dose makes the poison.” This notion was first attributed to sixteenth century philosopher-physician Paracelsus, who stated that all substances are poisonous-there is none which is not; the dose differentiates a poison from a remedy. Even water, in sufficient doses, can be toxic. Dose refers to the amount of chemical that enters the body, and, is probably the single most important factor to consider in evaluating whether an alleged exposure caused a specific adverse effect. Not all asbestos exposures cause cancer, and the scientific literature shows that more exposure leads to more disease (dose-response).

Plaintiffs showed nothing about how much asbestos Flores might have inhaled. He was exposed to “some asbestos” on a fairly regular basis for an extended period of time. Nevertheless, absent any evidence of dose, the jury could not evaluate the quantity of respirable asbestos to which Flores might have been exposed or whether those amounts were sufficient to cause his disease. Nor did Flores introduce evidence regarding what percentage of that indeterminate amount may have originated in defendant Borg-Warner products. Plaintiffs did not prove the asbestos content of other brands of brake pads or how much of Flores's exposure came from grinding new pads as opposed to blowing out old ones. Plaintiff need not show dose with mathematical precision.  But in a case like this, proof of mere frequency, regularity, and proximity is necessary but not sufficient, said the court, as it provides none of the quantitative information necessary to support causation under Texas law.
 

The proposed legislation would overturn that clear and compelling logic.

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Judge Engelhardt of the U.S. District Court for the Eastern District of Louisiana, overseeing the MDL relating to the alleged formaldehyde contamination of FEMA trailers used in the aftermath of Hurricane Katrina, has chosen a lawsuit by a New Orleans woman and her son to serve as the first bellwether case in this MDL. See In re: FEMA Trailer Formaldehyde Products Liability Litigation, MDL-1873 (E.D. La.).  Plaintiffs generally allege that trailers issued by the government following Hurricane Katrina exposed residents to high levels of the chemical formaldehyde.

The court had ordered the parties to submit the names of no less than 50 potential bellwether trial plaintiffs. From these names, one plaintiff for each of four bellwether jury trials was to  be selected. The manufacturer defendants for these four trials had to be the four estimated to have the most emergency housing units at issue in this proceeding. (These four manufacturers are Gulf Stream, Fleetwood, Forest River, and Keystone RV.)  Only plaintiffs who have identified and sued one of the four manufacturers, the relevant contractor, and the Government, were eligible to serve as bellwether trial plaintiffs. In addition, the bellwether plaintiffs must be selected from those plaintiffs for whom Plaintiff Fact Sheets already have been obtained and provided to the defendants. In addition, actions chosen for bellwether trials must have proper venue in the Eastern District of Louisiana, unless the parties in question consent to trial in this district.  The court, from that list, selected the case brought by Alana Alexander and Christopher Cooper against Gulf Stream Coach Inc. to be the first that will be tried in federal court. The trial is set for Sept. 14, with three other cases against the other different defendants scheduled to follow as the court approached the hundreds of suits through a series of bellwether trials.

Readers will recall that last December, the court properly refused to grant class certification to the six proposed subclasses of plaintiffs, finding they did not meet the standards required for class certification under Rule 23. The plaintiffs had sought certification of four state subclasses of individuals who resided in trailers provided by the Federal Emergency Management Agency in Louisiana, Texas, Alabama and Mississippi following hurricanes Katrina and Rita, as well as a future medical monitoring subclass, and an economic loss subclass.

The U.S. Judicial Panel on Multidistrict Litigation consolidated a number of suits against the
government and a handful of trailer manufacturers over the alleged formaldehyde exposure
in October 2007, despite defendants’ objections. The Centers for Disease Control and Prevention  released in 2008 the results of a study which it commissioned concerning formaldehyde levels in mobile homes provided to residents of the Gulf Coast affected by Hurricane Katrina in 2005.  CDC has been working with FEMA and other agencies to investigate possible levels of formaldehyde in the trailers and mobile homes.
 

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The Sherwin-Williams Co. has sued counsel for plaintiffs in past lead paint lawsuits, claiming that the attorneys for the Rhode Island attorney general and other claimants improperly obtained and used copies of internal documents discussing the paint manufacturers' strategy in the lead paint litigation. The complaint was filed against plaintiff counsel in state court in Ohio.

The complaint alleges that plaintiff counsel came into possession of confidential information from a 2004 board of directors meeting. Sherwin-Williams claims that the slides were created by its inside counsel in order to update the company's board on various issues in the lead paint and pigment litigation, including possible response to settlement overtures in dozens of public nuisance and private lawsuits.

We have posted on lead paint issues before. Properly viewed, state attorneys general typically fail to prove that the paint companies had control of the lead paint when it allegedly harmed children in their states. Control at the time the damage occurs is critical in any public nuisance cases, especially because the principal remedy for the harm caused by the nuisance is abatement. The responsibility for the harm that lead paint caused lies with property owners, as many state legislature have explicitly established. However grave the problem of lead paint may be, public nuisance law simply does not provide a remedy for this alleged harm. The proper means of commencing a lawsuit against a manufacturer of lead pigments for the sale of an allegedly unsafe product is a products liability action, with all the potential defenses to such a claim. Public nuisance and products liability are two distinct causes of action, each with rational boundaries that are not intended to overlap. Public nuisance focuses on the abatement of annoying or bothersome activities. Products liability law, on the other hand, has its own well-defined structure, which is designed specifically to allow plaintiffs to attempt to hold manufacturers liable for harmful products that the manufacturers have caused to enter into the stream of commerce.

Here, the company’s complaint alleges that plaintiff counsel presented the confidential slides in a legal memorandum opposing a motion for costs, filed with the Rhode Island Superior Court during the public nuisance suit brought by the Rhode Island attorney general. The company includes a John Doe defendant, allegedly responsible for disclosing the documents. Plaintiff counsel allegedly acknowledged receipt of the documents and their confidential nature, but has thus far refused to return them, according to the complaint.

Sherwin-Williams is seeking a return of the documents, an order barring plaintiffs from using them, punitive damages, costs and court fees. 

 

UPDATE:  The plaintiffs' firm has apparently agreed not to use or disseminate the documents pending further order of the court.
 

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The U.S. Environmental Protection Agency released a new strategic plan last week that is designed to allow it to better assess potential risks from chemicals by adopting new toxicity testing methods. The “U.S. Environmental Protection Agency’s Strategic Plan for Evaluating the Toxicity of Chemicals” outlines a new scientific approach that will allow EPA to assess risks from many chemicals and mixtures by adopting new toxicity testing methods that use recent advances in molecular biology, genomics, and computational sciences.

Readers of MassTortDefense who have an interest in toxic torts know the impact that government testing and evaluation of chemicals can have on litigation. Under the EPA's traditional risk assessment approach, the agency relied mostly on data generated through the intentional high dosing of experimental animals. While this approach has provided EPA a basis for much regulatory decision-making over the past several decades, such testing has known limitations arising from the dose-response concept and inter-species variations. Traditional testing also has been less useful on complex issues such as cumulative exposures, life-stage vulnerabilities and genetic susceptibilities.

The new approach is to focus more on identifying and evaluating cellular response pathways responsible for adverse health effects when sufficiently perturbed by environmental agents under realistic exposure conditions. The new Strategic Plan is centered on three interrelated components: (1) the use of toxicity pathways identification and use of this information in screening and prioritization of chemicals for further testing; (2) the use of toxicity pathways information in risk assessment; and (3) the institutional transition necessary to implement such practices across EPA.

In addition to the scientific bases, the new forms of testing, when fully implemented, will permit EPA to screen more environmental chemicals more quickly for potentially harmful effects. The strategic plan will also allow EPA scientists to look at how children may react differently to the same chemicals as adults, thus providing better health protection for children, says the Agency.

The EPA plan builds on the 2007 report, Toxicity Testing in the 21st Century: a Vision and a Strategy, of the National Research Council of the National Academies of Science, regarding toxicity testing and risk assessment.
 

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Two thousand Central American banana farm workers suing over their alleged exposure to a pesticide were permitted split up their suits to avoid federal court jurisdiction under the Class Action Fairness Act.  See Vanegas v. Dole Food Co., 2009 WL 690198 (C.D. Cal. 3/9/09).  The opinion allowed the plaintiffs to craft their suits against the Dole Food Co., Dow Chemical Co., and other defendants, so that they each have no more than 100 plaintiffs and avoid CAFA's mass action reach.

Plaintiffs allege that they were injured by exposure to 1, 2-Dibromo-3-chloropropane (“DBCP”), a toxic chemical sold under the brand names “Nemagon” and “Fumazone.” Plaintiffs allege that defendants manufactured, marketed, and distributed DBCP. Plaintiffs further allege that they were exposed to DBCP as a consequence of working on banana plantations in Costa Rica, Panama, Honduras, and Guatemala, owned or operated by defendants.

Plaintiffs were divided, alphabetically and by country, into 30 cookie cutter cases such that each case has less than 100 plaintiffs; they alleged claims for (1) products liability-negligence; (2) strict products liability; (3) products liability-defect in design, manufacture, and chemical composition; (4) products liability-breach of warranty; (5) fraudulent management; (6) intentional misrepresentation; (7) fraud by concealment; (8) general negligence; and (9) conspiracy.

Defendants removed, and plaintiffs sought remand. Plaintiffs argued that this case is not a “mass action” pursuant to the Class Action Fairness Act of 2005, 28 U.S .C. §§ 1332(d) and 1453, because their complaint s each contain less than 100 plaintiffs. Defendant responded that plaintiffs may not “gerry-mander their lawsuit to circumvent CAFA,” citing Freeman v. Blue Ridge Paper Products, Inc., 551 F.3d 405, 2008 WL 5396249, at *1 (6th Cir. Dec.29, 2008); Proffitt v. Abbott Laboratories, 2008 WL 4401367, at *5 (E.D.Tenn. Sept.23, 2008)). Defendants argued that plaintiffs cannot artificially splinter their actions to avoid jurisdictional thresholds.

The district court remanded, holding that the removal statute is to be “strictly construed against removal jurisdiction and any doubt must be resolved in favor of remand,” citing Hofler v. Aetna U.S. Healthcare of California, Inc., 296 F.3d 764, 767 (9th Cir.2002). These actions do not constitute “mass actions” under CAFA, said the court, because each of these actions has been brought by less than 100 plaintiffs. Tanoh v. AMVAC Chemical Corp., 2008 WL 4691004, at *5 (C.D.Cal. Oct.21, 2008). Nothing in CAFA suggests that plaintiffs, as masters of their complaint, may not “file multiple actions, each with fewer than 100 plaintiffs, to work within the confines of CAFA to keep their state-law claims in state court.” Tanoh, 2008 WL 4691004 at *5.

The court distinguished Freeman, saying the Sixth Circuit limited its ruling to one type of claim splitting. “In Freeman, the plaintiffs divided their suit into five separate suits with identical parties and claims, each covering distinct, sequential six-month time periods,” the court said. “By contrast, each of the cases at issue here involves distinct plaintiffs. Moreover, the Sixth Circuit explicitly noted that its holding is limited to the situation where there is “no colorable basis for dividing up the sought-for retrospective relief into separate time periods, other than to frustrate CAFA.”
 

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In the past few days, bills were introduced in both houses of Congress to ban bisphenol A in all food and beverage containers in the U.S.

The so-called Ban Poisonous Additives Act of 2009 is sponsored Rep. Edward Market, D-Mass. in the House, and by Sen. Dianne Feinstein, D-Calif. and Sen. Charles Schumer, D-N.Y. in the Senate. In the House it is H.R. 1523. In the Senate it is S.593

The proposed legislation would ban the sale of reusable beverage containers like baby bottles and thermoses that contain BPA and prohibit other food and beverage containers, including canned food and formula, containing the chemical from entering the market.

The bill, which would take effect 180 days after it is enacted, allows manufacturers who can show that a particular container cannot be made without BPA to obtain a renewable one year waiver to the ban. During that time, the company must label the product as containing BPA and submit a plan for removing the chemical in the future.

The bill also requires the secretary of HHS to conduct a periodic review of the list of substances that have been deemed safe for food and beverage containers, to determine whether new scientific research shows that the substances pose health risks. This review must take place “not less than once every 5 years,” under the bill.

MassTortDefense has posted about BPA issues before. With regard to BPA generally, based on all available evidence, the consensus of regulatory agencies in the United States, Canada, Europe, and Japan is that the current levels of exposure to BPA through food packaging do not pose an immediate health risk to the general population, including infants and young children.

Also in the press, six manufacturers — Avent, Disney First Years, Gerber, Dr. Brown, Playtex and Evenflo — announced that they would ban BPA in baby bottles they sell in the U.S. And Sunoco indicated that it had stopped selling BPA to anyone who would not promise to prohibit its use in products intended for children ages three and under.

Many of these companies are defendants in the ongoing BPA litigation, and their voluntary actions reflect the legal risks far more than the science. The companies noted this decision may address growing public concern and confusion regarding products made with polycarbonate plastic, but was not because these FDA-regulated products are not safe.

Any wide-spread ban of this product – or litigation accomplishing the same result -- may risk the public safety more than enhance it. Epoxy resins derived from bisphenol A are used to manufacture protective polymer coatings for the inner surface of metal food and beverage containers. This critical technology protects the contents of these containers from aggressive food products, thereby assuring a safe, wholesome, and nutritious food supply. Compared to other coating technologies, coatings derived from epoxy resins provide superior adhesion to the metal surface, greater durability, and higher resistance to the wide range of chemistry found in foods and beverages. These attributes are essential to protect the packed food from microbiological contamination, which is a significant food safety issue.

Canning might be the single most important innovation in the preservation of food in history. More than 1500 food items are regularly packed in cans, making out of season foods globally accessible year-round. More than 90% of food and beverage cans use epoxy-based coatings because of their strength, adhesion, formability and resistance to chemical reactions in the food and drinks -- without affecting the taste or smell of the product. They protect the food from the container and from bacterial contamination. They give canned foods their long shelf-life.

 

 

 

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When one thinks of global mass tort issues, questions of actions by European citizens in U.S. courts or the spate of class actions in Canada may come to mind. Perhaps we will need a broader perspective, as the courts in China have reportedly given the green light to suits arising out of the distribution of tainted dairy products. We have posted on this issue before, within the larger context of product issues arising from goods made in China.

The move signals an apparent change in the way Beijing is handling fallout from the melamine scandal, which was implicate din the death of at least six infants and sickening of nearly 300,000 others with kidney problems. A government-sanctioned compensation plan had been proposed to resolve the issues, but a large number of families have refused government compensation because it is too small, electing instead to try to sue. Under the payout plan organized by the dairies, families whose children died would have received 200,000 yuan ($29,000), while others received 30,000 yuan ($4,380) for serious cases of kidney stones and 2,000 yuan ($290) for less severe cases.

Plaintiffs needed government permission to bring suit, and it remains unclear how the government plans to handle the cases. Chinese courts often turn down class-action or group action suits, preferring to deal with cases one by one to avoid running afoul of Communist Party officials, who ultimately control the judiciary.

The crisis highlighted the need for major overhauls to China's food safety system, culminating in a law passed recently that proposes to consolidate hundreds of regulations covering the country's 500,000 food processing companies.
 

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While asbestos may be regarded as the grandfather of mass torts, Agent Orange is not far behind in longevity. In the latest chapter, the U.S. Supreme Court last week declined to review three court orders dismissing damages claims against manufacturers of Agent Orange; plaintiffs had alleged that exposure to defoliants during the Vietnam War caused cancer and other illnesses. See Isaacson v. Dow Chemical Co., U.S., No. 08-460, 3/2/09; Stephenson v. Dow Chemical Co., U.S., No. 08-461, 3/2/09; Vietnam Ass'n for Victims of Agent Orange v. Dow Chemical Co., U.S., No. 08-470, 3/2/09.

The denial of cert leaves intact three decisions last year by the Second Circuit in favor of Dow Chemical, Monsanto Co., and other defendant companies . See Isaacson v. Dow Chemical Co., 517 F.3d 129 (2d Cir. 2008); Stephenson v. Dow Chemical Co., 2008 U.S. App. LEXIS 6201 (2d Cir. 2008); Vietnam Ass'n for Victims of Agent Orange v. Dow Chemical Co., 517 F.3d 104 (2d Cir. 2008). The Second Circuit rulings largely relied on the government contractor defense to protect the government and wartime contractors from being sued civilly for their federal executive function activities. The government contractor defense in essence prevents plaintiffs from doing an end run around a statute that prohibits them from suing federal officials directly. The government contractor defense shields companies from liability if they rely on government specifications, accurately follow those specifications, and inform the government about any problems with the product the government doesn’t know about. Here, the government continued to order Agent Orange and declared its toxicity levels acceptable, the Second Circuit found.

A major settlement was reached in the Agent Orange cases filed decades ago, but another later round of suits was filed by people who alleged they became ill after 1994 as the result of Agent Orange exposure. Defendants, no doubt, are hopeful that this will be the end of the Agent Orange litigation.

In the third case, the claims brought by Vietnamese nationals under the Alien Tort Statute alleged that the spraying of herbicides in South Vietnam between 1962 and 1970 was a violation of international law. The Second Circuit dismissed the appeal by the Vietnamese nationals, finding that because the toxin was used to protect U.S. troops against ambush, and not as a weapon of war against human populations, the plaintiffs had failed to adequately plead a violation of international law. In addition, the court concluded that any domestic tort law claims by Vietnamese citizens were barred by the government contractor defense.
 

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A putative class of Florida homeowners recently filed suit against a company that manufactured drywall in China, alleging the material used in their homes emits sulfur compounds that damaged heating and electrical wiring, and created health risks. See Allen v. Knauf Plasterboard Tianjin, No. 09-CV-54-FtM-99 DNF (M.D. Fla., complaint filed 1/30/09). This is just the latest potentially significant suit arising over products made in China. Plaintiffs allege that defendants manufactured drywall that contained fly ash from Chinese coal-fired power plants, causing the product to emit sulfur compounds that create odor and corrode copper in air conditioning units and wiring in homes. At least one home builder has also brought claims over the drywall issues.

Plaintiffs’ attorneys claim that as much as 10 million square feet of such drywall was used in Florida homes due to shortages of American-made drywall between 2004 and 2006. The complaint asserted causes of action including negligence and negligence per se, strict liability, breach of express and implied warranties, fraudulent misrepresentation, and violation of Florida's deceptive and unfair trade practices act. Defendants dispute the allegations and note that any low levels of sulfur compounds present in the air in homes are not a health risk

Regardless of the merits of the case, and clearly such claims are typically inappropriate for class certification because of the individual issues that will be presented by evidence surrounding injury and causation, there is a growing volume of cases over alleged defects in products made in China. Such litigation can also raise insurance coverage disputes. Coverage litigation has erupted concerning the recent heparin drug contamination allegations, for example. What importers tell their insurers about their source of supply; whether subsidiaries are covered; whether importers here are in de facto joint ventures with Chinese suppliers; and similar questions may be front and center in coverage disputes when this type of products litigation hits. Insurance companies seem to be increasingly playing the card that insureds needed to disclose the details of their manufacturing suppliers. The recent China dairy product scandal may have insurers arguing that product defects are the result of intentional, criminal behavior, rather than negligence.

With the Consumer Product Safety Improvement Act of 2008 seeking to place importers on the hook for defects, U.S. companies may be in the market for more coverage. At the same time, Chinese exporters have not felt the need to buy insurance as they feel judgment-proof in U.S. courts. However, importers may want to consider requiring their suppliers to purchase such insurance as part of the bargaining.
 

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The U.S. Court of Federal Claims ruled last week in three bellwether cases that thimerosal vaccines do not cause autism in children. Three special masters of the Court ruled against plaintiffs in three separate test cases, finding insufficient evidence of a casual link between autism and the MMR (measles, mumps, rubella) vaccine.

Thimerosal has been widely used for decades as a preservative in a number of biologic and pharmaceutical products, including vaccines. It prevents life-threatening contamination. Increasing concern over the potential toxicity of the chemical has led to the removal or reduction to trace amounts of the preservative in most vaccines routinely given children aged 6 and under.

That same concern is behind numerous legal claims alleging that that routine childhood shots are to blame for the rising incidence of autism. The National Vaccine Injury Compensation Program, 42 U.S.C. §300aa-10, et seq., governs such claims, requiring plaintiffs to file a special no-fault compensation petition with the Court of Federal Claims, rather than a traditional suit against manufacturers. Part of the policy behind the program is the potential impact on public health of a traditional mass tort type of litigation involving life-saving vaccines, ranging from polio to chicken pox. Approximately 12,000 cases have been filed under the program.

To be eligible for compensation under the Vaccine Act, a petitioner must either demonstrate a "Vaccine Table" injury, to which a statutory presumption of causation attaches, or prove by a preponderance of the evidence that a vaccine listed caused or significantly aggravated an alleged injury. Althen v. Sec’y, HHS, 418 F.3d 1274, 1278 (Fed. Cir. 2005).  Autism claims fall in that latter category.  In 2002, the Court set up an Omnibus Autism Proceeding to test the three main theories of general causation: that the vaccines and thimerosal combine to cause autism; that thimerosal-containing vaccines cause autism; or that MMR vaccines can cause autism.

Separate opinions covered the Snyder, Hazelhurst, and Cedilllo test cases, but each represent the first, and major, theory, that the vaccines and thimerosal somehow combine to cause autism. The three cases involved some 5,000 pages of transcripts, 939 medical articles and 50 expert reports. The vast majority of credible scientific studies have shown -- and all federal health agencies have strenuously argued -- that there is no connection between vaccines and autism. And public health officials have repeatedly warned that fewer immunizations will endanger children. Indeed, at least in part because of the scare, about one in 12 children does not receive the MMR vaccine in the United States.

The Cedillos contended that their daughter fell sick a week after she received an MMR shot when she was about 16 months old. Today, at age 14, she requires round-the-clock care, suffers from seizures, has lost nearly all her vision and has constant abdominal pain.The Court found that the Cedillos have been misled by physicians who are guilty, in the Court’s view, of gross medical misjudgment on the issue of causation.

The Snyders argued that the MMR vaccine, or the mercury-based preservative in it, had triggered in their son pervasive developmental disorder -- part of the autism spectrum. But, the Court found that the experts contending there is no link between autism and vaccines were far more qualified, better supported by the weight of scientific research and authority, and simply more persuasive on nearly every point in contention.

In the Hazlehurst claim, parents alleged that the MMR vaccine had caused "regressive autism" in their son. Agreeing with the other special masters, the Court found their causation evidence fell short, concluding that the combination of the thimerosal-containing vaccines and the MMR vaccine are not causal factors in the development of autism and therefore, could not have contributed to the development of their child's autism. The weight of the presented evidence that is scientifically reliable and methodologically sound does not support petitioners’ claims.
 

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Jurors in Oakland, CA., concluded last week that welding products manufacturers were not liable for any neurological impairments suffered by a long-time welder. See Thomas v. A.O. Smith Corp., at al. (Calif. Super. Ct., Alameda Cty.).The trial lasted about 3 weeks, and the Alameda County jury delivered its verdict after approximately three and a half hours of deliberations. Judge Robert B. Freedman presided. Trial defendants included Lincoln Electric Co., ESAB Group, and Hobart Brothers Co.

The Thomas trial marks the first time allegations that a worker became ill from exposure to welding rod fumes has been heard by a California state court jury. Thomas had alleged that welding rod manufacturers knew that welding fumes were toxic and failed to adequately warn of the risk of neurological disorders. As a result of his exposure, Thomas alleged he suffered severe physical and emotional injuries.

On the eve of trial, Judge Freedman had denied defense motions to exclude testimony by Thomas’ medical experts and industrial hygienist, but granted a motion to preclude a plaintiff warning expert from offering an opinion as to whether defendants had a duty to warn or on the effectiveness of defendants’ warning labels.

Judge Freedman also barred plaintiffs from making pejorative references to the “welding industry,” or making plaintiffs' typical, inappropriate comparisons to tobacco or asbestos companies. However, the judge denied a defense motion to prevent plaintiffs from referring to defendants’ lobbying activities.

The jury’s finding was that welding fumes did not cause the plaintiff’s injury, and this seems to support what defendants have contended: there is no sufficient link between welding fumes and Parkinson’s disease. By our count that is 22 of the last 26 verdicts for defendants in this mass tort.
 

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The Food and Drug Administration has announced a public meeting on BPA to be held on February 24, 2009, by the Science Board to the FDA. This public advisory committee, whose function it is to provide advice and recommendations to the agency on FDA’s various regulatory issues, will discuss updates from the agency on the continued assessment of Bisphenol A in FDA-regulated products. The Science Board will also hear about the plans for (1) The review of FDA Center’s science programs, (2) the review of each Center’s projects within scientific priority areas.

The meeting will be held at the Hilton Washington DC, North/Gaithersburg, 620 Perry Pkwy., Gaithersburg, MD 20877. FDA intends to make background material available to the public no later than 2 business days before the meeting.

Late last month, the FDA and Health Canada’s Health Products and Food Branch hosted a meeting of representatives of U.S. and Canadian manufacturers and users of food packaging materials containing BPA to discuss what is being done to concerning the potential levels of the chemical in food. The meeting was also part of FDA’s efforts to assist industry in its voluntary BPA related efforts.

The meeting was designed to provide a forum for:
• Updating the industry on the FDA’s and Health Canada’s current activities and planned research to further assess the exposure to BPA and manage any potential risks from the chemical.
• Describing manufacturers’ research activities, their work to refine packaging manufacturing practices to minimize migration of BPA into food, and recent marketplace developments.
• Dialogue by the participants about further information from regulated industry stakeholders that would be helpful to the FDA and Health Canada in updating and refining their BPA risk assessments.
• Dialogue about the different uses of BPA in food contact applications and the variation in possible availability of fully functional and evaluated alternative substances.
• Discussion of the possibility whether, because of availability of alternative products, polycarbonate baby bottles could cease to be a substantial component of the North American market in the future.

With regard to BPA generally, based on all available evidence, the consensus of regulatory agencies in the United States, Canada, Europe, and Japan is that the current levels of exposure to BPA through food packaging do not pose an immediate health risk to the general population, including infants and young children.

Health Canada’s Health Products and Food Branch has concluded that current dietary exposure to BPA through food packaging uses is not expected to pose a health risk to the general population, including newborns and infants. However, using an extremely precautionary approach, the Government of Canada has taken steps to reduce exposure to BPA for infants and young children.
The FDA is currently preparing a detailed response to the October, 2008 review by the FDA Science Board of the agency's draft assessment of the safety of BPA for use in food contact applications. The draft assessment focused on the concerns for developmental toxicity identified in recent assessments of BPA, including those of the National Toxicology Program and their expert panel. For example, the FDA is reviewing research about the potential low-dose effects of BPA. 

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The Sixth Circuit has affirmed the dismissal of claims that a child contracted mesothelioma from exposure to his father's asbestos-laden clothes, finding no evidence that such a “bystander” injury was foreseeable at the time of the alleged exposure. Martin v. Cincinnati Gas and Electric Co., 2009 WL 188051 (6th Cir. 1/27/09).

Claims were brought against the father's old utility company employer and a company that allegedly manufactured asbestos-fireproofing for the utility. The claims were based on asbestos that Martin's father allegedly brought home on his work clothes while working for the utility, CG & E. The district court granted summary judgment for defendants because neither had a legal duty to the plaintiff.

Under applicable Kentucky law, as in most jurisdictions, duty presents a question of law for the judge to decide. Typically, there is a universal duty of care which requires every person to exercise ordinary care in his activities to prevent foreseeable injury. The most important factor in determining whether a duty exists is foreseeability. And foreseeability, in turn, is determined based on what the defendant knew or should have known at the time of the alleged negligence. There was no evidence that either defendant had actual knowledge of the danger of bystander exposure, so the question is whether they should have known: that is, was such a risk foreseeable to them based on “common knowledge at the time and in the community?”

Plaintiff’s expert report did not indicate that the risk was knowable, but in any event, it is insufficient that the danger was merely knowable: the knowledge has to have been available to the defendant. There was an insufficient showing of any general knowledge of bystander exposure in the industry. Plaintiff's expert report concedes that the first studies of bystander exposure were not published until 1965. (Martin's father's exposure to asbestos materials stopped in 1963).

The court rejected the plaintiff’s reliance on several cases from other states where bystander asbestos exposure liability has been upheld; the Sixth Circuit agreed with a number of other cases in which courts have found no duty for secondary asbestos exposure. E.g., CSX Transp. Inc. v. Williams, 608 S.E.2d 208, 210 (Ga. 2005); Adams v. Owens-Illinois Inc., 705 A.2d 58, 66 (Md. Ct. App. 1998); In re Certified Question from Fourteenth Dist. Ct. of Appeals of Tex., 740 N.W.2d at 218-20; In re New York City Asbestos Litig., 840 N.E.2d 115, 121 (N.Y. 2005); and Alcoa Inc. v. Behringer, 235 S.W.3d 456, 462 (Tex. Ct. App. 2007).
 

Summary judgment affirmed.

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The U.S. Court of Appeals for the Sixth Circuit has affirmed the district court's denial of class action status in litigation arising from a 2002 incident in which a Norfolk Southern train derailed, causing a chemical spill.  See Turnage v. Norfolk Southern Corp., No. 07-6033,  2009 WL 140479 (6th Cir. 2009).

While so much of the focus in class actions is on Rule 23 (b) provisions, the court found that plaintiffs had not demonstrated that the number of people allegedly harmed by the spill, but not already fully compensated, was so numerous as to make joinder impractical. While this 23(a)requirement is commonly referred to as a “numerosity” requirement, the real issue is whether the plaintiff seeking class certification has demonstrated impracticability of joinder.

The incident had led to a mandatory evacuation of homes within a 1 mile radius of the site, and a voluntary evacuation of those within a 3 mile radius.  Nevertheless, the class definition, and the number of putative class members, was a moving target throughout the litigation.

The proximity of class members to each other, and the discrete and obvious nature of the alleged harm, made identifying class members easy.  And made joinder easier too. So, while some courts find the proximity of class members a factor in favor of certification under Rule 23 (b), the 6th Circuit noted the opposite effect on the 23(a) factor.

After the incident, the defendant had set up claim centers and reimbursed a vast majority of households within the 1 mile radius for out-of-pocket expenses related to food, clothing, and lodging. Plaintiffs made an insufficient showing that the residents included in their numbers suffered actual damage. Plaintiffs failed to show how many of the 15,000 supposedly uncompensated residents actually evacuated. The excludable group includes those who were out of town during the evacuation, those in the voluntary zone who chose not to evacuate and whose daily routines were little disturbed, and those who were able to relocate temporarily to other quarters with little inconvenience or expense.
 

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An interesting little case: a personal injury class gets certified, defendant stipulates to key elements of liability, and defendant wins the trial anyway.

The Louisiana appeals court has affirmed a lower court ruling in favor of E.I. du Pont de Nemours & Co. in a case involving an accidental chemical release at a DuPont facility in Reserve, Louisiana. See Johnson v. E.I. du Pont de Nemours & Co., 2009 WL 91481 (La.App. 5 Cir. 2009).

The named plaintiffs filed a class action petition in 1994, alleging they were injured by the release of toxic chemicals at a DuPont facility after a small chemical accident. The trial court certified the matter as a class action in September, 1997. DuPont stipulated to certain elements of liability in 2000, but reserved their right to trial on damages, causation, the nature of the chemicals released, and the area affected. The plaintiffs apparently agreed to waive all claims for punitive damages in the stipulation.

At a bench trial in 2006, the trial court ruled in favor of DuPont, finding that the plaintiffs had not met their burden on causation. The plaintiffs failed to show exposure to harmful levels of chemicals, and to show that plaintiffs' injuries were caused by the chemical explosion.

The Louisiana Court of Appeal has agreed, saying that plaintiffs' sole medical expert did not establish that the plaintiffs' injuries— nausea, eye and skin irritation, coughing, and headaches—were caused by the chemical release. Plaintiff’s expert treated the plaintiffs at the time of their alleged injury and had diagnosed them with “fume inhalation,” but based entirely on the history provided by the plaintiffs.

The court also rejected plaintiffs’ challenge to the testimony of a DuPont witness about plaintiffs' alleged injuries, because such testimony was about his observations of plaintiffs' alleged injuries, not testimony as a medical expert. Although he was closer to the incident than plaintiffs, he did not hear any explosion, did not smell anything, and did not experience nausea, headaches, eye irritation, or other symptoms.
 

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The Fifth Circuit has affirmed a trial court decision that a group of space center workers in Mississippi cannot pursue personal injury claims for their alleged exposure to beryllium-containing products because they could not show any “compensable injury.” Paz v. Brush Engineered Materials Inc., 2009 WL 73874 (5th Cir. 2009).

Pursuant to Mississippi law, claims of negligence, products liability, and breach of warranty all require an identifiable injury. Plaintiffs alleged that they had beryllium sensitization (BeS), i.e., an increased sensitivity to the potentially toxic substance. According to their expert, BeS is by definition the demonstration of an abnormal immune response to beryllium, usually, though not always based on an abnormal challenge test.

The issue was whether the BeS was a compensable injury pursuant to Mississippi law. The employees argued BeS is a present injury and “the beginning of an actual disease process,” specifically the beginning stage of Chronic Beryllium Disease;  therefore there is a reasonable probability of future consequences from BeS. Plaintiff experts’ published work, however, stated that “BeS precedes the formation of … clinical illness.”  And it indicates that individuals with BeS exhibit evidence of an immune response to beryllium but have no evidence of lung pathology or impairment. Further, there was no dispute that the rate of progression from BeS to CBD is unknown to any degree of reasonable medical certainty.

The expert evidence from both sides clearly established that excessive exposure to beryllium provokes a physical change in the body, causing BeS. The quintessential issue, said the 5th Circuit, is whether any or every physiologic change in the body rises to the level of compensable injury pursuant to Mississippi law. The federal court found guidance in the state court’s recent decision in this same case on medical monitoring, which we have mentioned before. In answering the 5th Circuit's certified question, the Mississippi Supreme Court stated “a claim for medical monitoring, as Plaintiffs present it, lacks an injury.” 949 So.2d at 3. The Mississippi Supreme Court concluded that because “Mississippi requires the traditional elements of proof in a tort action, it has refused to recognize a category of potential illness actions.” The Mississippi Supreme Court noted “[n]one of the plaintiffs ha[d] suffered physical injury from the alleged exposure.” Pursuant to Mississippi law, “exposure” is “a claim for harm which is not compensable under Mississippi law.”

The sub-clinical and sub-cellular changes, which none of the parties disputed, are akin to what the Mississippi Supreme Court refused to recognize as physical injuries. Thus, the logical conclusion is BeS is not a compensable injury pursuant to Mississippi law. This seems to be the Mississippi Supreme Court's “line in the sand" for a plaintiff's legally protected interest.  Summary judgment affirmed.

While states vary on the point, this is an important issue: as medical technology advances, the ability to show some sub-clinical or sub-cellular impact on the body becomes increasingly common.  Will every such change, what traditionally has been seen as mere exposure lacking sufficient impact, impairment, symptom, be an injury?  Plaintiffs may like to think so in some cases, but won't the single injury rule and statute of limitations bite them in others?
 

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Readers of MassTortDefense have been following the issues surrounding the dairy product contamination scandal in China, which we have posted on before.

Two recent developments: The families of 213 children who were sickened by tainted infant formula and milk have now filed a class-action lawsuit with China's highest court, seeking damages from 22 dairy producers. Class actions are rare in China; this one seeks damages mainly for parents whose children were made ill by melamine-laden dairy products, but who were offered what they saw as inadequate compensation by dairy companies. Under that plan, most received $292, while wrongful death cases were offered $29,200. Plaintiffs assert that the lower amounts were not enough to cover what they paid for doctors, medicines and other expenses.

According to the Chinese Health Ministry, nearly 300,000 children were made ill by tainted milk and at least six died. Melamine was reportedly added to milk products to fool protein-content tests.
In order for the class suit to proceed, the China Supreme Court must first agree to hear the case. Court filings in China must be accepted by the courts before they are considered on the merits.

On the criminal side, media reports are that 12 dairy officials were found guilty of charges related to the melamine issue; 2 were sentenced to death, and the highest ranking official was sentenced to life in prison as part of a plea bargain deal. Prosecutors showed that officials at the companies involved learned of the problem in 2007 but did not recall any products until September, 2008. 

In its latest update, FDA notes that there is no known threat of contamination in infant formula manufactured by companies that have met the requirements to sell such products in the United States.  In addition, the FDA -– in conjunction with state and local officials – continues to check Asian markets for food items that are imported from China and that could contain a significant amount of milk or milk proteins.

The FDA has broadened its domestic and import sampling and testing of milk-derived ingredients and finished food products containing milk or milk-derived ingredients from Chinese sources. FDA has recommended that consumers not consume certain products because of possible contamination with melamine.

 

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MassTortDefense has posted on nanotechnology issues before.  In the past few months, the EPA has clarified its view of carbon nanotubes, 73 Fed. reg. 64946 (Oct. 31, 2008); has issued a new rule affecting 50 or more nanoparticles in use in industry, 73 Fed.Reg. 65743 (Nov.5, 2008); and has asked for public comment on a petition for rulemaking submitted concerning nanoscale silver. 73 Fed.Reg. 69644 (Nov.19, 2008).

These actions may be a precursor of a flood of government actions affecting nanotechnology by a new Administration.  Here are some links to help interested readers stay on top of these issues (no endorsement of content, as usual):

Centers for Disease Control and Prevention / NIOSH
U.S. Environmental Protection Agency
U.S. Food and Drug Administration
National Nanotechnology Initiative (NNI)
Dept. of Health and Human Services National Toxicology Program

Woodrow Wilson Center, Project on Emerging Nanotechnologies

International Council on Nanotechnology (ICON), Environmental, Health and Safety database: Nano Science and Technology Institute (NSTI)

NanoBusiness Alliance

European Commission
Cluster Science, including Nanoclusters and Nanoparticles
Virtual Journal of Nanoscience and Nanotechnology
NanoScience Today Imagazine  

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A couple months ago, MassTortDefense posted about a decision in which the federal court in West Virginia denied class certification in a claim brought against DuPont for the alleged release of perfluoroctanoic acid, a substance also known as PFOA or C-8, from its Washington Works plant in Wood County, West Virginia, into drinking water. See Rhodes v. E.I. DuPont De Nemours and Co., 2008 WL 4414720 (S.D. W.Va., September 30, 2008). Plaintiffs are appealing that.

Now, the federal district court in New Jersey has similarly rejected class certification in two consolidated suits in which state residents argued that DuPont should pay for a medical monitoring program because their drinking water was allegedly contaminated with a Teflon-related chemical. See Rowe v. E.I. du Pont de Nemours & Co., D.N.J., No. 06-1810; Scott v. E.I. du Pont de Nemours & Co., D.N.J., No. 06-3080.

PFOA, also known as C-8, is made by DuPont for use in a variety of consumer products, including in non-stick cookware. Plaintiff sought medical monitoring to detect disease in the future they were allegedly put at risk for based on exposure to the chemical. But to recover medical monitoring costs, plaintiffs must show “significant exposure” to a chemical. Plaintiffs argued they had sufficient common proof of “significant exposure” to PFOA because tests revealed that the water supply around DuPont's Chambers Works Plant in New Jersey allegedly exceeded .04 parts per billion (ppb) for the substance, and the New Jersey Department of Environmental Protection recommended .04 ppb as the “safe” level of exposure. The plaintiffs also offered Dr. David Gray, a toxicologist, to testify that .02 ppb was actually the level at which negative health affects may start showing up in individuals.

The court first rejected any use of the settlement by DuPont of previous PFOA claims to show the existence of common issues. The other case was ultimately resolved through “voluntary settlement,” the court said. DuPont's statements cannot be considered admissions of liability, causation, or appropriate damages.

The court also rejected plaintiffs use of regulatory-based risk assessments. While they may be an appropriate way to determine for the public what health and environmental officials believe are “safe” levels of a chemical in drinking water, they are not themselves an adequate means of showing the kind of significant exposure to a substance that is required to support medical monitoring claims. There is a difference between a “safe” level for public policy and regulatory purposes and the “significant exposure” that creates the sufficiently excessive risk needed to trigger medical monitoring. “Such methodology does not work in the tort litigation context, where a plaintiff must prove that he has suffered an actual increased risk of disease in order to merit recovery in the form of medical monitoring.”

Also affecting their utility in the class context, the risk assessments are based on assumptions about the general population, and are thus not applicable to show class-wide significant exposure. Plaintiffs’ expert merely assumed that class members all weighed a certain amount and consumed a certain amount of allegedly contaminated water. Those assumptions are not necessarily true for all class members—indeed, they are undoubtedly false, as the class contained thousands of individuals who are different sizes and have different water consumption habits.

Importantly, given plaintiff’ counsel refrain about the cost of pre-complaint, pre-certification homework, and the frequent "we'll deal with that later" mentality, the court noted while it would take significant investigative efforts to obtain information specific to each individual in the proposed class, the difficulty of this task does not excuse plaintiffs from doing it. A class action is not intended to be an easy way around research problems. Plaintiffs have the burden of proving that each class member has suffered significant exposure to PFOA—they cannot circumvent this requirement by simply relying on assumptions about the general population.
 

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China's Dairy Industry Association announced last week that the Chinese dairy companies accused of producing contaminated milk-containing products have agreed to pay compensation.  Reports are that nearly 300,000 people (mostly kids) were sickened, and six reportedly died.  Baby formula was contaminated with melamine, apparently an intentional act to deceive protein quality control testing.  Melamine artificially increases the protein profile of the milk, but can cause kidney damage at higher doses.

MassTortDefense has posted on the issues before.

The settlement includes an immediate payment of $130 million, and $30 million to cover future medical bills for related health problems.  Wrongful death cases will receive a reported $30,000, and seriously sick kids' families will get $4000.  Some 28,000 product users were hospitalized.

Many officials responsible for quality control and inspection of the dairy industry have been fired or indicted.  Trials are ongoing for 17 such defendants, and the former head of the largest dairy outfit was to be charged last week with manufacturing and selling counterfeit goods. That company, the Sanlu Group, ceased operations and filed for the equivalent of bankruptcy in the Fall.

China is also reportedly revising its regulatory approach to the dairy industry, with new safety and quality standards, new testing approaches, and more tools to enable local governments to catch issues.

 

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The U.S. Food and Drug Administration has decided to support additional research with regard to its analysis of BPA safety in plastic baby bottles and food and drink containers. The FDA’s basic position is that current human exposure to BPA in food-packaging materials provides an adequate margin of safety. The FDA’s draft risk assessment on this issue was released in August, finding the chemical safe as it is now used. However, after an FDA advisory committee on the subject questioned some of the FDA methodology and data sources, the FDA has now decided to conduct additional research, as cited in a letter to the advisory committee.

FDA is re-evaluating available data and planning for the acquisition of additional data that will strengthen the exposure estimates from all dietary sources of BPA, with particular attention to dietary sources relevant to infants and children. FDA also will study the cumulative effects of BPA in humans.

Makers of BPA say that the chemical poses no known risk to human health. In response to public demand, some manufacturers have begun introducing products for infants and children that are BPA-free. The Environmental Protection Agency has calculated that adults and infants can consume 50 micrograms of BPA per kilogram of body weight every day over a lifetime with little appreciable risk of harm.

One of the underlying issues is the use of animal studies. There is no epidemiological evidence that human beings of any age or developmental stage have been harmed in any way by common exposure to BPA. Even workers using the chemical in manufacturing have not been shown to have suffered any harm. The fact that rodents suffer effects at high doses of the chemical may have nothing to do with human health: the same animal tests performed on things we eat and drink every day give the same "toxicity" results. Nevertheless, the planned "large research effort," with studies lasting years that will assess the effects of the chemical in laboratory animals including rodents and monkeys. FDA is planning to conduct these studies in its laboratories using representative dose ranges and multiple animal models.

MassTortDefense has posted on BPA before.
 

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The federal court in the FEMA Trailer MDL has denied class certification to a class of plaintiffs alleging that they were harmed or put at risk of future harm by formaldehyde exposure after residing in Federal Emergency Management Agency trailers following Hurricanes Rita and Katrina. See In re FEMA Trailer Formaldehyde Products Liability Litigation, MDL No.1873 (E.D. La., class certification denied 12/29/08).

In a previous post, MassTortDefense reported on the court’s analysis of the personal injury class claims. Today, we look at the medical monitoring class claims, a topic about which we have posted before.

In addition to all the general reasons set forth for why class certification was inappropriate, the court offered additional analysis as to why certification of the medical monitoring class (the "future medical services sub-class" ) was inappropriate.

Plaintiffs contended that class-wide common issues of law and fact included: (1) whether certain plaintiffs were significantly exposed to formaldehyde, an allegedly hazardous substance; (2) whether certain plaintiffs now suffer a significantly increased risk of contracting a serious latent disease, associated with formaldehyde exposure; (3) whether certain plaintiffs’ risk of contracting such a disease is greater than (a) the risk of contracting the same disease had there been no exposure, and (b) the chances of members of the public at large of developing the disease; (4) whether a medical procedure exists that makes the early detection of any such diseases possible; (5) whether the future medical services regime for such detection is different from medical services recommended in the absence of exposure; and (6) whether there is some demonstrated clinical value in the early detection and diagnosis of any such diseases. In essence, plaintiffs alleged that most of the elements of a medical monitoring claim were common.

The Court felt, however, that the first two allegedly class-wide issues, exposure and increased risk, were actually individual issues. Whether an individual has been “significantly exposed” to formaldehyde will differ depending on several variables, including other exposures, past and present cigarette use, formaldehyde-containing cosmetics use, etc. Thus, an accurate exposure level for a class representative has no bearing on an accurate exposure level for any other member of the proposed class because of these differing variables. Similarly, determining an individual’s risk of developing a particular formaldehyde-related disease or injury is keyed to several individual factors, including level of exposure, duration of exposure, and other individual characteristics such as whether the person has other risk factors for contracting a particular injury or disease.

Second, while the proposed medical monitoring sub-class would require the application of laws of “only” four different states, plaintiffs failed to make any substantial attempt to explain whether any individual variations in those states’ laws are manageable here, or whether they would “swamp common issues of law and fact.”

Next, the court found that plaintiffs’ proposed class was unorthodox in that it sought an order to monitor and treat the injuries that have resulted from that exposure. That is, a future medical services subclass should be certified to set up and maintain a program by which plaintiffs’ injuries may be detected and treated. Seemingly, plaintiffs went beyond the usual talk of treatment in the context of whether treatment exists such that monitoring could be beneficial, to essentially call for the development of a program aimed at also providing treatment to individuals (especially children) who have been adversely affected by hazardous levels of formaldehyde in the units.

But, by essentially requesting monitoring and treatment in the class, subclass members would arguably be relieved of the burden that they would bear in an individual suit, relative to proving any current manifest injury or disease. The court agrees found that plaintiffs were indeed attempting to skip over the process of obtaining the requisite liability finding against the manufacturing defendants, by holding them responsible for funding a monitoring and treatment service for injuries that a jury may later deem was never their responsibility. In other words, the monitoring program requested by plaintiffs seems to bypass a liability finding on injury in favor of immediate medical monitoring and treatment, both. Plaintiffs failed to demonstrate to the court why defendants should be asked to pay for such a program without, first, a finding of liability against them.

Finally, defendants contended that plaintiffs, as a group, did not meet the “manifest physical injury” requirement, which they asserted is a prerequisite for medical monitoring in Texas, Louisiana, Mississippi, and Alabama. Plaintiffs, on the other hand, asserted that they meet this requirement because the physical injury they claim to have suffered is in the form of “cellular and molecular” damage. Even without addressing the issue whether such cellular damage qualifies as a manifest present injury, the court felt it would still be faced with the individualized inquiry of whether formaldehyde exposure resulting from the units caused those "injuries." This is not an issue that can be determined on a class-wide basis.

Accordingly, the medical monitoring class claims involved too many individual issues. 

 

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The federal court in the FEMA Trailer MDL has denied class certification to a class of plaintiffs alleging that they were harmed by formaldehyde exposure after residing in Federal Emergency Management Agency trailers following Hurricanes Rita and Katrina. See In re FEMA Trailer Formaldehyde Products Liability Litigation, MDL No.1873 (E.D. La., class certification denied 12/29/08).

The plaintiffs had filed claims against the United States and several manufacturers alleging that they were exposed to high levels of formaldehyde contained in emergency housing provided to them by FEMA. The plaintiffs proposed six subclasses, including four subclasses for residents divided by state (Louisiana, Alabama, Texas, and Mississippi), a medical monitoring (“future medical services”) subclass, and an economic loss subclass.

More on the medical monitoirng in a later post.  Today, the focus is the current injruy claims.

Judge Engelhart found that the proposed subclasses did not meet the requirements of Federal Rule of Civil Procedure 23(a) or 23(b)(3).

Commonality

Interestingly, the court found that the plaintiffs had not met the commonality requirement of 23(a), usually not a demanding test. Plaintiffs alleged that common questions existed relating to why and how formaldehyde exposure occurred, what level of formaldehyde exposure was experienced, and who was exposed to the formaldehyde. Plaintiffs, as is typical, claim that defendants’ conduct or fault was a central and common issue. Plaintiffs argued that common issues of fact also relate to the scientific nature and behavior of formaldehyde. On the other hand, defendants argued that there is no commonality because plaintiffs lived in different units, and the court agreed. This case did not involve one single product that is alleged to have caused plaintiffs damage. Instead, plaintiffs have alleged that dozens of different manufacturing defendants have manufactured products that have caused them harm. The court found that the question of defendants’ conduct or fault in the failure to exercise reasonable care is clearly not a common issue because there are dozens of defendants who have manufactured numerous different products that have allegedly caused harm to plaintiffs. In that regard, a determination of fault as to one defendant will not answer the question as to any other defendant. Last, a determination relating to the scientific nature and behavior of formaldehyde is not common as to all class members as the true issue relates to the specific level of formaldehyde that each plaintiff experienced in his/her unit and the resulting symptoms allegedly suffered by that particular plaintiff.

Typicality

A second significant part of the analysis focused on 23(a)’s requirement of typicality. defendants noted that the proposed class representatives claim a myriad of symptoms and conditions, including unconsciousness, convulsions, nephritis, and hypothermia. Indeed, the Plaintiff Fact Sheet (“PFS”) designated a total of 47 alleged formaldehyde-related symptoms, ranging from low blood pressure to miscarriage and stillbirth. Plaintiffs have diverse medical histories, symptoms, and alleged exposures. Typicality is not satisfied where plaintiffs’ claims and defenses will be dominated by individual evidence. Thus, this MDL involves factual variations as to each plaintiff and proposed class representative which spawn individual issues relating to injury and causation as to each individual. Each plaintiffs’ claims and alleged injuries will require an examination of individual evidence, precluding the satisfaction of the typicality requirement for class certification. For example, plaintiffs admitted that a child’s lungs react differently to formaldehyde exposure than an adult’s lungs. Plaintiffs’ counsel also admitted that temperature, humidity, and ventilation affect and contribute to differences in formaldehyde levels in the units.

Predominance

Turning to Rule 23(b)(3), the court found common issues did not predominate and the class method was not superior: this MDL involves hundreds of models of trailers, produced by dozens of different manufacturers. Moreover, even units of the same make and model, made by the same manufacturer, can differ in regards to what components parts were used and when it was manufactured. Further complicating this aspect of these claims, exposure to formaldehyde (at certain levels) is fairly common in today’s society and the chemical is produced by the human body itself. Each plaintiffs’ potential formaldehyde exposure and any resulting health effects vary according to several different factors. Each plaintiff’s habits vary greatly, resulting in the necessity for individualized inquiries delving into the use of heating and air conditioning, and also window or door use (important to how ventilated a particular unit was). Some
plaintiffs are exposed to sources of formaldehyde and eye/nose/throat irritants unrelated to that said to be found in the units (resulting from contact with air pollution, pesticides, pets, cleaning agents, mold, bacteria, and viruses).

Further, as for the alleged injuries to the plaintiffs themselves, the court said that each one has suffered an individual physical injury that is specific to that particular individual, precluding the predominance of issues relating to the plaintiffs themselves. Also, the personal injury claims among plaintiffs vary greatly.

The Court concluded that plaintiffs’ claims will, to a significant degree, be individualized with respect to causation and will include individual issues of exposure, susceptibility to illness, and types of physical injuries. Hence, no class action.

 

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Those interested in nano-technology issues may want to check out a conference next Spring, entitled NanoImpactNet: For a Healthy Environment in a Future with Nanotechnology.

NanoImpactNet is the European network on the health and environmental impact of  nanomaterials. It is a platform for exchange about research ideas and to bring together scientists, industry, policy makers and consumers to ensure the safe and responsible development of nanomaterials. NanoImpactNet is part of the European Commission’s commitment to define a robust European strategy on nanotechnology which includes health, safety and environmental issues.

Launched in April 2008, this multidisciplinary network’s objective is to create a scientific basis to support the definition of regulatory measures and the implementation of legislation across the EU.  The 24 institutes behind NanoImpactNet members are leading European research groups active in the fields of nanosafety, nanorisk assessment and nanotoxicology. Through numerous workshops over a period of four years, NanoImpactNet will bring together some of the top researchers to discuss future strategies, to exchange their ideas with the different stakeholder groups and to further the responsible development of nanotechnology.
 

The conference is set for Laussanne, Switzerland, March 23-27, 2009.
 

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A new report from the National Research Council questions the government's current plan for research on the possible health and environmental risks posed by nanomaterials, which are increasingly being used in consumer products and other industry. The report emphasizes the need for an effective national plan for identifying and managing potential risks, a step seen as essential to the successful development and public acceptance of nanotechnology-enabled products.

Nanoscale engineering manipulates materials at the molecular and atomic level to create structures with unique and useful properties – materials that are both very strong and very light, for example. More than 600 products involving nanomaterials are already on the market, the majority of them health and fitness products, such as skin care and cosmetics. And over the next decade, nanomaterials will be used increasingly in products ranging from medical therapies to food additives to electronics. MassTortDefense has posted about nano-issues before.

Growing use of nanomaterials means that more workers and consumers may be exposed to them, and uncertainties remain in the minds of some about their health and environmental effects; while nanomaterials can yield tremendous, special utility, they may also have possibly toxic risk properties.

The National Nanotechnology Initiative, which coordinates federal agency investments in nanoscale R&D, developed a research plan to investigate these risks, and the office that oversees NNI asked the National Research Council to review the plan.  (The NRC report was sponsored by the National Nanotechnology Coordination Office. The National Academy of Sciences, National Academy of Engineering, Institute of Medicine, and National Research Council make up the National Academies. They are private, nonprofit institutions that provide science, technology, and health policy advice under a congressional charter.)  The Research Council is the principal operating agency of the National Academy of Sciences and the National Academy of Engineering.

The committee report did not focus on current uses of nanomaterials and any potential risks to the public. Rather, the report focused on what would constitute an effective national research strategy for ensuring that current and future uses of nanomaterials are without significant impacts on human health or the environment.

The current plan, involving nano-risk research across several federal agencies, lacks an overarching research strategy needed to gain public acceptance and realize the promise of nanotechnology, according to the report.  NNI's plan identifies broad research categories for assessing health and environmental risks, and many of the research needs listed within these categories will aid risk assessment, the report says. But the plan fails to identify some important other areas that should be investigated; for example, "Nanomaterials and Human Health" should include a more comprehensive evaluation of how nanomaterials are absorbed and metabolized by the body and how toxic they are at realistic exposure levels. Furthermore, the current research plan, according to the report, does not provide a clear picture of the current understanding of these risks or where it should be in 10 years. And though the research needs listed in the plan are valuable, the NRC committee thinks they are incomplete, in some cases missing elements crucial for progress in understanding nanomaterials' health and safety impacts.

In its assessment of gaps in existing research, the current NNI plan overstates the degree to which already funded studies are meeting the need for research on health and environmental risks, the report says. For example, more than half of the currently funded projects on nanotechnology and human health are aimed at developing therapies for diseases. While this research is important, it will not shed light on health risks that may be posed by nanomaterials. Moreover, the plan does not note the current lack of studies on how to manage consumer and environmental risks, such as how to manage accidents and spills or mitigate exposure through consumer products.

A truly robust national strategic plan would involve a broader group of stakeholders, and would consider the untapped knowledge of nongovernment researchers and academics, the committee said. The current structure of NNI would make developing a new strategy difficult, says the report. NNI should continue to foster successful interagency coordination, with the aim of ensuring that the federal research strategy on the health and safety impacts of nanotechnology is an integral part of the broader national strategic plan.
 

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The MDL court in the Teflon products litigation has refused to certify 23 proposed statewide consumer fraud class actions. In re Teflon Products Liability Litigation, 2008 WL 5148713 (S.D. Iowa, 2008).

Plaintiffs alleged that in producing and marketing Teflon® and unbranded, non-stick cookware coatings (“NSCC”), defendant DuPont allegedly made misleading representations regarding safety. None of the proposed class representatives alleged that he or she had been injured by the use of DuPont NSCC. Rather, in each of the purported class actions, plaintiffs sought recovery solely for economic damage and injunctive relief. In particular, plaintiffs demanded creation of a fund for scientific researchers to further investigate the potential for adverse health effects from the use of products containing DuPont's non-stick coating; that DuPont discontinue selling cookware containing the non-stick coating; that DuPont stop making alleged misstatements regarding the safety of its product; that DuPont replace and/or exchange all existing cookware containing DuPont non-stick coating possessed by class members with non-hazardous cookware; rescission and restitution; and/or that DuPont provide a new warning label or other disclosure on cookware made with or containing DuPont non-stick coating.

DuPont has steadfastly denied that PFOA's or any other chemicals are released at harmful levels when cookware coated with Teflon is used as intended.

The Class
The court first identified key deficiencies in plaintiffs’ attempt to define an ascertainable class. As they typically do, plaintiffs argued that at this stage, they do not need to show that each class member ultimately will be able to prove his or her membership; rather, the court need only ensure that the appropriate criteria exists to evaluate membership when the time comes. The court felt this argument necessarily depended upon the availability of evidence to establish membership at a later stage of the proceeding. No such evidence existed to be produced in the case. Deposition testimony showed that it is virtually impossible to identify a brand of non-stick coating based on a visual examination of the item of cookware. Testimony from the class members was thus a key component of the product identification and thus class membership issue. But, even after a lengthy discovery period, during which each proposed representative was thoroughly deposed, many class reps were unable to ascertain whether they belonged in the class or a particular sub-class. An “abundance” of proposed representatives had no memory whatsoever of the circumstances surrounding their purchase of the cookware—let alone records to document their purchase. Bottom line, too many infirmities existed in the class definitions to ensure that the court could determine objectively who was in the class, without resort to speculation. For example, many class representatives mistakenly believed their product contained Teflon coating-even when they were informed the particular brand of cookware at issue never used Teflon.

Lastly, membership in this class necessarily required a plaintiff to pinpoint the date on which he or she purchased the item of cookware; the proposed class representatives were unable to recall this information one-fourth of the time.

Typicality, Coherence, Predominance
An analysis of the claims made clear that common issues did not predominate; class reps’ claims were not typical. Plaintiffs built the majority of their claims around statements made and/or marketing practices employed by DuPont regarding its NSCC products. According to plaintiffs, the fact that each cause of action derived from an alleged  “common practice or course of conduct” on the part of DuPont rendered the claims made by a representative plaintiff typical of the claims of all class members. However, the alleged misstatements cited by plaintiffs span a forty-plus-year period, across a wide variety of advertising and promotional media. Each plaintiff was exposed to different representations, at different time periods. Because reliance is a key element of plaintiffs' claim for negligent misrepresentation, and is necessary for recovery under the consumer fraud statutes in many jurisdictions, an individualized inquiry must be conducted not only to pinpoint the representations at issue, but also to determine the extent to which each plaintiff relied upon the particular representations. Due to the widespread nature of DuPont's advertising over the years, however, determining the precise statements each plaintiff heard could only be accomplished through individualized inquiry.

The court also pointed out the varying degrees to which each plaintiff became educated about NSCC prior to purchase.  Even if class members were exposed to the same representation, advertisement, or omission, the court could not presume that each member responded to the representation or omission in an identical fashion. Here, some proposed class representatives who were informed of potential health risks from NSCC stopped using the cookware, but others exposed to similar information continued to use their existing cookware, and others purchased new non-stick cookware.

Finally the court worried that plaintiffs were splitting their cause of action and thus harming absent class members. Under any one of their alternative bases for relief, plaintiffs necessarily must establish first that DuPont's non-stick cookware coating is dangerous to the health of its users. But the class disclaimed personal injury and had abandoned their original claims for medical monitoring. The representative plaintiffs risked a future waiver not only of their own personal injury and medical monitoring claims, but also those of the absent class members.

 

 

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A federal court has granted summary judgment in a toxic tort suit in which plaintiff alleged he contracted a bone disease because of his long-term exposure to trace amounts of benzene in oil-based paint. Smolowitz v. The Sherwin-Williams Co., 2008 WL 4862981 (E.D.N.Y. Nov. 10, 2008). Plaintiff failed to offer sufficient evidence under New York law of exposure level.

In order to prevail in a toxic tort case, plaintiffs must present sufficient evidence to support a finding that defendants' products caused plaintiffs' injuries. Proof of causation requires establishing both “general” causation and “specific” causation.  General causation bears on whether the type of injury at issue can be caused or exacerbated by the defendant's product. Specific causation bears on whether, in the particular instance, the injury actually was caused or exacerbated by the defendant's product.  The fundamental principle of toxicology is that the dose makes the poison: substances that are benign or even beneficial at a certain level can be toxic at another. Even when general causation is clear, a plaintiff must show that he or she was exposed to a sufficient dose of the substance to have caused the disease. Under New York law, plaintiffs must establish both general and specific causation through expert testimony

Plaintiff Richard Smolowitz worked as a drywall taper and spackler over a thirty year period beginning in the 1950s and ending in the early 1980s. Plaintiff alleges that his exposure to benzene in paints caused him to contract myelodysplastic syndrome (“MDS”).  A central factual issue in this case, said the court, was the level of exposure to which plaintiff was subject, and whether that level of exposure can cause MDS. First, plaintiff was not a painter, but alleged he worked in areas where paint products were regularly used. Second, the solvents used in defendants' oil based paints contained only a trace contamination of benzene due to the fact that the products are based on petroleum, and it is not always possible to remove all of the benzene during the manufacturing process.

In early motion practice, plaintiff's counsel represented that he would provide the testimony of expert witnesses who could prove that plaintiff was exposed to oil based paints with sufficient levels of benzene to cause his illness. Eventually, he relied on the opinions of plaintiff's treating physician, Dr. Silverman, to provide expert testimony on issues of general and specific causation. The doctor reported he was currently treating plaintiff for MDS; that Smolowitz reported a history of exposure to oil based paints, thinners and benzene during a 35-year period; and that in his opinion it was “likely to a reasonable medical probability, that Mr. Smolowitz's exposure to benzene during the years that he worked as a dry-wall mechanic is causative for his current hematologic condition.”

The court concluded that Dr. Silverman's testimony was inadequate to prove either general or specific causation. The conclusory statement that based upon plaintiff's reported history it was likely to a reasonable medical probability that Mr. Smolowitz's exposure to benzene during the years that he worked as a dry-wall mechanic is causative for his current hematologic condition, had substantial deficiencies. First, there was nothing in this statement that suggests that Dr. Silverman was aware of or had quantified the precise amount of benzene to which plaintiff was exposed. No proof of dose. Second, Dr. Silverman did not offer any opinion as to whether that limited level of benzene exposure, whatever it was, can cause the disease. In the absence of sufficient evidence from an expert or a treating physician of the plaintiff's exposure level, plaintiff could not prove the essential causation element of the claim.
 

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The FDA continues to take action to attempt to limit the impact of the China milk scandal on U.S. consumers. As part of its ongoing strategy to address the present problem with melamine contamination of consumer products exported from the People’s Republic of China, FDA has expanded its import controls on Chinese dairy products, and food and feed products manufactured in China that contain dairy ingredients. Candy, snacks, bakery products, pet food and other Chinese products that contain milk will now be detained at the border until tests prove that they are not contaminated. This action was taken to help ensure that only those Chinese dairy products (and food and feed products manufactured in China that contain dairy ingredients) which are not contaminated with melamine and melamine-related compounds reach U.S. consumers.

No adverse health effects have been reported in the United States from contamination with melamine of dairy products or dairy containing products. But melamine is not approved for direct addition to human or animal foods and no manufacturer is allowed to deliberately add it to any food for U.S. consumers.  Since melamine was discovered in infant formula in September it apparently has sickened more than 50,000 infants in China and killed at least four. Since that time, melamine has been found in a wide range of other products, including milk, eggs and fish feed. Testing by the FDA has detected melamine and cyanuric acid, a related contaminant, in a number of products that contain milk or milk-derived ingredients, including candy and beverages, according to the FDA alert. China is also one of the world’s biggest makers of supplements, and some protein powders and shakes are made largely with powdered milk.

The agency has at times blocked imports of individual food products, but it is rare for it to block an entire category of one country’s foods. The widely spread assessment is that food and feed dealers in China added melamine to their products because it increases nitrogen content to give the appearance in testing that protein levels meet specifications.

Concern has been expressed about delays spilling over to other food imports, but the FDA said the percentage of food subject to the import alert is small. Another possible issue is that private laboratories which perform product tests for FDA compliance already reportedly have long waiting lists. The agency said it won't release the imported food unless an independent laboratory verifies that representative samples contain no melamine or cyanuric acid, a melamine derivative.
At a broader level, one wonders what the alert may do to the recently negotiated opening of FDA offices in China. The timing of the FDA alert coincides with an upcoming  meeting between Health and Human Services Secretary Michael Leavitt and top Chinese health officials in Beijing.
 

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Many readers of MassTortDefense know that nanotechnology refers to a new field of technology that seeks to manipulate and control products, really matter, on the atomic and molecular scale, typically 100 nanometers or smaller. To give some sense of scale, one nanometer is one billionth, or 10-9 of a meter. A nanometer compared to a meter is the roughly the same ratio as that of a baseball to the size of the Earth. Or another analogy, a nanometer is the length a man's whiskers grow in the time it takes him to lift his razor to his face to shave.

First, the European Food Safety Authority (EFSA) recently called for public comments on its draft scientific opinion document assessing the potential risks of engineered nanomaterials used in food and feed. EFSA opinions provide guidance for the European Commission and European Union member state food safety organizations.

EFSA has noted that complete information about engineered nanomaterials in food is lacking, leading to uncertainties in risk assessment. In particular, the agency said knowledge is limited about how engineered nanomaterials in food should be characterized, detected, and measured. It also said more information is needed on the toxicological and environmental impacts of using such nanomaterials.

The comment period on the draft opinion is open until Dec. 1, after which the scientific opinion will be revised and finalized, taking the comments into account.

Second, back in the US, the activist group Consumers Union released new product tests this week, claiming to show that some sunscreens claiming not to contain nanoparticles appeared to contain them.
 
The group is concerned because nano-size particles are known in some applications to have different properties than the conventional versions of these chemicals. Sunscreen manufacturers use nano-size particles of these ingredients for several reason, including because they help make the products clear rather than opaque, something consumers prefer. The European Union has required manufacturers to submit data on sunscreens containing nanoparticles.

Third, the EPA has issued an announcement intended to give notice of the potential application of the Toxic Substances Control Act (TSCA) requirements to carbon nanotubes (CNTs). Carbon nanotubes are generally made from sheets of graphite no thicker than an atom—about a nanometer, or one billionth of a meter wide—and formed into cylinders, with the diameter varying from a few nanometers up to tens of nanometers. They are excellent conductors of electricity. Carbon nanotubes can also be used to reinforce polymers to create very strong plastics. Carbon nanotubes show promise as building blocks for computer chips that are smaller and faster than those made of silicon. Economists predict that the market for carbon nanotubes will grow to more than $1 billion by 2014.

EPA generally considers CNTs to be chemical substances distinct from graphite or other allotropes of carbon already listed on the TSCA Inventory. Many CNTs may therefore be new chemicals under TSCA. If a particular CNT is not on the TSCA Inventory, anyone who intends to manufacture or import that CNT is required to submit a premanufacture notice (PMN) at least 90 days before commencing manufacture. MassTortDefense has posted about carbon nanotubes before.

Apparently, inquiries to the Agency and questions in public forums indicated a lack of clarity on this issue. Some of the misunderstanding may be the result of an EPA communication to a chemical manufacturer a number of years ago pertaining to a substance the Agency now considers to be a carbon nanotube material. EPA understands that the earlier communication may have been misunderstood by some companies as a possible indication that all CNTs may be equivalent to other allotropes of carbon already on the TSCA Inventory. Hence the clarification.
 

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The recent decision in Boyd v. Allied Signal, Inc., 2008 WL 4603401 (La.App. 1st Cir., October 17, 2008), illustrates a distressingly common feature of class actions, particularly those in the toxic tort context. Class representatives who are not injured, and not even members of the class.

The basic facts: a compressed gas trailer owned by Allied Signal, Inc. and loaded with boron trifluoride developed a leak from one of its tubes while being transported as a tractor-trailer unit. After the leak was discovered, the tractor-trailer unit stopped around noon on the westbound shoulder of I-12 on or near its overpass for Cedarcrest Avenue in Baton Rouge, where the tube continued to leak and dispersed BF3 in the air. Mitigation efforts ensued, and were completed approximately eighteen hours later.

A number of civil actions seeking class action status were subsequently filed by those allegedly impacted by the leak. The trial court consolidated the various actions and ultimately certified a class action as to the issue of liability, establishing geographic boundaries approximately corresponding to those of an emergency “shelter in place” plan for nearby residents and to various gas dispersion plumes or isopleths estimated on a successive hourly basis by the plaintiffs' expert in atmospheric dispersion. The Louisiana court of appeals affirmed the trial court's decision to certify the class action. Boyd v. Allied Signal, Inc., 898 So.2d 450, 453-54 (La.App. 1st Cir.12/30/04), writ denied, 897 So.2d 606 (La.4/1/05).

One of the class reps claimed she had entered the westbound portion of Interstate Highway 12, and about five to ten minutes later encountered stalled traffic and observed a police officer some distance ahead, standing outside his unit. After pulling her vehicle onto the shoulder, she and her husband allegedly exited the vehicle and walked to the side of the highway, where she observed a truck ahead, surrounded by a haze. Ms. Smith claimed that she experienced eye irritation and coughing during the course of events, and washed her eyes with eyewash after arriving at her destination. She did not seek medical treatment for those claimed symptoms.

Ms. Smith was confirmed as a class representative. But identification of members of the class based upon their claims of physical presence in its geographic and temporal limits is an issue separate from proof of the veracity of such claims. Ms. Smith was not thereby relieved of her burden of proof on the issues of causation and damages by virtue of her status as a class representative. Defendants appealed the judgment in favor of Ms. Smith.

Under cross-examination, Ms. Smith had acknowledged there was nothing that prevented her from using an exit to get off I-12, rather than remain on the shoulder. Her husband admitted they were told to get back in their vehicle. In deposition he admitted that they never drove past the leaking tractor-trailer. Thus, during the time she was on I-12, she never closely approached the class geographic boundaries. The geographic boundaries of the class were carefully drawn to coincide as closely as practicable with a circle defined by the quarter-mile “shelter-in-place” radius centered on “ground zero” and the BF3 dispersion plumes postulated by the plaintiffs' expert in air dispersion in his air modeling.

At the conclusion of Ms. Smith's presentation of evidence, the defendants moved for involuntary dismissal of Ms. Smith's cause of action on the grounds that she failed to prove any symptomatic exposure to BF3. The defendants emphasized that the plaintiffs' own expert testified that the exit plaintiff used was outside the area of his air modeling, and that any concentration at that location “was so low that it would not have any significance from the point of view of a toxicologist.”

The trial court clearly erred in finding that Ms. Smith sustained symptomatic BF3 exposure while traveling on I-12. There was no testimony or other evidence supporting that finding. The court of appeals carefully reviewed the maps, diagrams, and aerial photographs showing the geographic boundaries of the class. That review leads to the inescapable conclusion that Ms. Smith failed to prove that she was within the class geographic boundaries and that she suffered any exposure to airborne BF3 sufficient to cause any symptoms.
 

It is amazing that the claim was handled properly only on appeal, for a plaintiff who was not exposed, not injured, should never have been a class rep, was not a class member, and had no business obtaining a judgment at trial.

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Several recent developments concerning BPA.

The Canadian government announced earlier this month that it intends to draft new regulations to prohibit the importation, sale, and advertising of baby bottles containing bisphenol A; the proposed bans are to take effect in 2009.

Environment Canada and Health Canada have released a scientific assessment, concluding that bisphenol A poses no danger to the general public, but expressing some uncertainty about its potential impact on infants up to 18 months of age. The scientific evidence of the neuro-developmental and behavioral impact of bisphenol A on rodent test subjects, although highly uncertain and not capable of easy extrapolation to humans, is apparently providing the basis for taking action to limit exposure to the substance for newborns and infants. The government plans also to allocate almost $2 million to support additional research on bisphenol A.

The first regulatory step comes as Environment Canada and Health Canada published a notice of their intention to designate bisphenol A as toxic under the Canadian Environmental Protection Act, a first step that allows the government to take regulatory action on the chemical. The agencies also issued a draft risk management approach for the chemical that aims to reduce releases of the substance into the environment. The proposed risk management plan, which is open to a 60-day public comment period that started on Oct. 18, said that BPA should be managed using a life cycle approach that prevents or minimizes its release into the environment.

The Canadian draft plan incorporates a regulatory ban on the import, sale, and advertising of polycarbonate baby bottles made with bisphenol A. It calls for the adoption of an “as low as reasonably achievable” principle in the packaging of canned infant formula, and indicates that the government will develop migration target levels for bisphenol A from infant formula cans to the formula they contain. The government proposes exploration of imposing migration targets for bisphenol A in canned foods in general.  The regulations will establish maximum bisphenol A concentrations in industrial effluents and will require the implementation of management systems for facilities where the substance is used, the draft plan said.

In addition, the plan calls for a survey on the content of bisphenol A in medical devices, further research on exposure of pregnant women to the substance, monitoring through the Canadian Total Diet Study, and additional environmental monitoring in waste water effluents and waters downstream from waste water treatment plants.

Meanwhile, back in the States…
State attorneys general from Connecticut, Delaware, and New Jersey called on manufacturers of baby bottles and baby formula to stop using BPA in their products. The AGs cite the recent studies in letters to the companies urging them to stop putting BPA into infant formula containers. “Mounting evidence suggests that BPA from the lining of these cans leaches directly into the infant formula,” claimed the AGs.

The AGs cited a February 2008 publication of the Work Group for Safe Markets, a coalition of liberal public health and environmental advocacy organizations, advocating without much support  that low levels of exposure to BPA may cause damage to reproductive, neurological, and immune systems during stages of fetal and infant development. They also cite the study released by Yale School of Medicine on BPA exposure and effects on brain function and mood disorders in monkeys.

The letters were reportedly sent to: Avent, Disney First Years, Gerber, Dr. Brown, Playtex, Evenflo, Abbott, Mead Johnson, PBM Products, Nature's One, and Wyeth.

Finally, the FDA Science Board Subcommittee on Bisphenol A has just released comments on the FDA’s draft exposure assessment of BPA. The Science Board provides advice primarily to the Commissioner of the FDA and other appropriate officials on specific complex and technical issues as well as emerging issues within the scientific community. This temporary Subcommittee was established by the Science Board and consists of two members of the Science Advisory Board and five scientists drawn from academia and government agencies. The focus of this Subcommittee is the scientific peer-review of the draft assessment prepared by the FDA of bisphenol A for use in food contact applications.

While the Subcommittee agrees with the focus of the draft assessment on dietary exposures to children, they believe that the FDA assessment would be strengthened by considering cumulative exposures and differential risk in neonates. They also recommend that the FDA exposure assessment be expanded to include a larger number of infant formula samples and that it rely on mean values rather than accounting for the variability in samples. Until the qualitative and quantitative information (including application of uncertainty factors) is revised, the Subcommittee cannot yet agree that the Margins of Safety defined by FDA are adequate.
 

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The U.S. District Court for the Eastern District of Pennsylvania has recently dismissed a class action seeking a medical monitoring program for employees at a beryllium plant alleging exposure to airborne beryllium. Anthony v. Small Tube Manufacturing Corp., 2008 WL 4443896 (E.D.Pa.).

Gary Anthony, as sole class representative, asserted a claim of negligence on behalf of himself and a class of employees and former employees at the U.S. Gauge facility in Sellersville, Pa. The complaint alleged that the employees were exposed to airborne beryllium while working at the plant. The class was alleged to include several thousand members. The workers allegedly faced an increased risk of contracting “chronic beryllium disease” as a result of their exposure to airborne beryllium. CBD is a lung disorder which occurs when a person's immune system over-reacts to inhaled particles of beryllium and produces pathological changes in the lungs called granulomas.

Beryllium is a strong, lightweight metal with a high melting point, high stiffness-to-weight ratio, and excellent thermal and electrical conductivity. Beryllium is used as a pure metal, but more frequently it is incorporated at low levels into alloys. Beryllium copper is the most widely used alloy, but beryllium is also combined with aluminum, nickel and magnesium, to produce a panoply of products from non-sparking tools, and aircraft brakes, to laser targeting systems and nuclear weapons.

The putative class sought the establishment of a medical monitoring program funded by defendants, and administered under court supervision. As readers of MassTortDefense may recall, a claim for medical monitoring under Pennsylvania law, requires a plaintiff to prove:

(1) exposure greater than normal background levels;

(2) to a proven hazardous substance;

(3) caused by the defendant's negligence;

(4) as a proximate result of the exposure, plaintiff has a significantly increased risk of contracting a serious latent disease;

(5) a monitoring procedure exists that makes early detection of the disease possible;

(6) the prescribed monitoring regime is different from that normally recommended in the absence of the exposure; and

(7) the prescribed monitoring regime is reasonably necessary according to contemporary scientific principles.

Redland Soccer v. Department of the Army, 548 Pa. 178, 195-196, 696 A.2d 137, 145-146 (1997).

Defendants here sought summary judgment, attacking the validity of the claim of the named representative. (And if he did not have a viable claim, he was not an adequate class rep.). Plaintiff could not show he was “sensitized” to beryllium. Defendants averred that beryllium sensitization is required to sustain a claim for medical monitoring based on exposure to beryllium. That is, without being sensitized to beryllium, a plaintiff cannot demonstrate that he is at a significantly increased risk of contracting chronic beryllium disease (CBD), the only known latent disease which results from beryllium exposure. A person becomes sensitized to beryllium when his immune system recognizes beryllium as a foreign agent and builds cells in the bloodstream to react against it. The defendants contended that this sensitization is a necessary precondition to the development of chronic beryllium disease.

Plaintiff argued that all individuals sufficiently exposed to beryllium are at risk for the development of beryllium-related health effects. The putative class, having been exposed, was at a significantly increased risk of contracting CBD and should be medically monitored for the development of beryllium sensitivity. Plaintiff contended that it has “long been known” that machinists of beryllium are at a significantly increased risk of contracting CBD, and, therefore, summary judgment was inappropriate in this case.

Defendants further asserted that the Pennsylvania intermediate appellate court’s decision in Pohl v. NGK Metals Corporation, 936 A.2d 43 (Pa.Super.2007), allocatur denied, 952 A.2d 678 (Pa.2008) (per curiam), specifically rejected a plaintiff's experts' conclusions that mere exposure to beryllium is sufficient to create a significantly increased risk of contracting CBD. Plaintiff responded that, at best, Pohl stands for the proposition that the plaintiffs in that case were unable to demonstrate that their specific exposures to beryllium rose to the level of creating a significantly increased risk of harm.

The federal court did not read the Superior Court decision in Pohl as establishing a positive rule of law that a plaintiff must prove that he or she is beryllium sensitized in all cases seeking medical monitoring for beryllium exposure. However, as a matter of expert proof, it was clear to the court that to be diagnosed with CBD one must in fact be both beryllium sensitized (as demonstrated by a positive test result) and have a positive pulmonary biopsy indicating the presence of granulomas. Without being sensitized to beryllium, plaintiff cannot ever have a diagnosis of chronic beryllium disease. Therefore, plaintiff cannot demonstrate he is at a significantly increased risk of developing CBD, the only latent disease which results from exposure to beryllium.

While plaintiffs’ experts opined that all individuals exposed to beryllium, including machinists like plaintiff, were at a significantly increased risk of contracting chronic beryllium disease, even before they become beryllium sensitized, the court found that the experts did not have the data necessary to support their conclusions in this regard. The “opinions” were “merely assumptions and speculation.” Specifically, they did not have, or base their opinions upon, any beryllium readings, measurements, or other exposure data from the U.S. Gauge plant.

 

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The Supreme Court of Ohio ruled last week that a 2004 state law imposing limits on asbestos litigation should be applied retroactively. Ackison v. Anchor Packing Co., et al., 2008 WL 4601676 (Ohio Oct. 15, 2008). The ruling could affect the 40,000 claims pending in that state, as well as provide a possible precedent for other states considering the same kind of tort reform.

The 2004 Ohio statute extensively revised state laws governing asbestos litigation and was in response to a legislative finding that the current asbestos personal injury litigation system is unfair and inefficient, imposing a severe burden on litigants and taxpayers alike. The bill established certain threshold requirements, including that no person shall bring or maintain certain kinds of asbestos claims (including claims alleging a nonmalignant condition) without filing with the court certain qualifying medical evidence of physical impairment; further, such evidence must be supported by the written opinion of a competent medical authority stating that the claimant's exposure to asbestos was a substantial contributing factor to his medical condition. The claim of any plaintiff who does not file the required preliminary medical evidence and physician's statement is to be administratively dismissed “without prejudice” with the court retaining jurisdiction, meaning that a plaintiff would not be barred from reinstating the claim in the future when and if the plaintiff could meet the threshold evidentiary requirements.

The court of appeals found the statute could not constitutionally be applied to any suit that had been filed prior to the effective date of the statutory changes, as such plaintiffs had a vested substantive right to pursue recovery for injury under the statutes that were in effect at the time their complaint was filed.

The supreme court disagreed. In this case, the Ohio General Assembly expressly directed that the prima facie filing requirements at issue apply to cases pending on -and thus filed before- the effective date of the legislation. Because the General Assembly so specified, the issue becomes “whether the statute is substantive, rendering it unconstitutionally retroactive, as opposed to merely remedial.” Under Ohio law, and this is fairly  typical, a statute is substantive if it impairs or takes away vested rights, affects an accrued substantive right, imposes new or additional burdens, duties, obligations, or liabilities as to a past transaction, or creates a new right. Conversely, remedial laws are those affecting only the remedy provided, and include laws that merely substitute a new or more appropriate remedy for the enforcement of an existing right.

The court found that the new law is remedial and procedural in nature and, therefore, not unconstitutionally retroactive. The reform established “a procedural prioritization” of asbestos-related cases, a procedure to prioritize the administration and resolution of a cause of action that already exists. No new substantive burdens are placed on claimants.

Clearly, the types of asbestos claims most impacted by the reform statute are the non-malignant claims, short of true asbestosis which is rare anymore, where some radiographic minor finding is alleged to be an injury. While some lower courts in Ohio had stated that pleural plaque or pleural thickening meets the definition of bodily harm which is a subspecies of physical harm and thus satisfies the injury requirements of Sections 388 and 402A of the Restatement of the Law 2d, Torts. E.g., Verbryke v. Owens-Corning Fiberglas Corp., 84 Ohio App.3d 388, 616 N.E.2d 1162 (1992). The supreme court determined that the Maryland court's approach is the better reasoned one: in Owens-Illinois, Inc. v. Armstrong, 87 Md.App. 699, 591 A.2d 544 (Md.App.1991), reversed in part on other grounds 326 Md. 107, 604 A.2d 47 (1992), the Court of Special Appeals of Maryland held that the Restatement did not support the conclusion that pleural plaques and pleural thickening alone were sufficient to constitute harm.

Plaintiffs also attacked the statute’s definition of “competent medical authority” which previously had not been defined by either statute or Ohio case law. By choosing to define that term, said the court, the legislature did not take away Ackison's right to pursue a claim. Nor did the definition alter the quantum of proof necessary for a plaintiff to prevail in an asbestos-related claim. Rather, it merely defined the procedural framework by which trial courts are to adjudicate such claims. The definition of competent medical authority pertains to the witness's competency to testify and is, in essence, more akin to a rule of evidence. As such, it is procedural in nature.
 

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The Food & Drug Administration (FDA) should be opening its new China office later in 2008. In the past couple years, as posted here at MassTortDefense, multiple imports from China have been at the center of safety concerns. Earlier this year, heparin allegedly contaminated with a counterfeit ingredient was blamed by some plainitff attorneys for some patient deaths; FDA has issued recalls of several foods imported from China that may have apparently been tainted with the industrial chemical melamine, which has been added to dairy products and resulted in hospitalization of thousands of children in China.

FDA staff posted at the China office will inspect facilities, provide guidance on U.S. quality standards, and later train local experts to conduct inspections on behalf of the FDA. The FDA will eventually open offices in the Chinese cities of Shanghai and Guangzhou, for a total of eight planned FDA staffers. The agency hopes a greater on the ground presence in China will help prevent unsafe imports, and the opening of a Beijing, China office later this year is just the first step in the FDA’s plan to expand its presence overseas. Over the next year, the agency plans to place as many as 60 food and drug regulators in offices worldwide, focusing on India, Latin America and the Middle East. The plan for permanent outposts marks a break from the agency's current practice of sending inspectors abroad on individual assignments.

Part of an updated import inspection plan may be to allow voluntary inspection, where manufacturers would pay third-party inspectors to verify that their plants meet FDA standards, although past attempts at a voluntary inspections system haven’t been well received by some overseas manufacturers. Democrats in the House of Representatives, offering yet another alternative, have proposed a program that would require companies to pay mandatory user fees to help finance additional FDA inspections.

Health and Human Services Secretary Michael Levitt is scheduled to travel to China next month to meet with health officials there to review joint efforts to ensure the safety of food and medical imports. The Consumer Product Safety Commission also worked to get people stationed in China. Under the current plan, the CPSC staffers who will be sent there eventually are not full inspectors. Their purpose will be to provide technical assistance to Chinese manufacturers and regulators.
 

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The Food and Drug Administration is requesting assistance in the identification of types
of FDA-regulated products that contain Bisphenol A (BPA), whether as a component of the product or its packaging, and any information relating to the possible leaching of BPA from the packaging to the product and/or from the product from the product following human administration.

BPA is a chemical commodity used primarily in the production of polycarbonate plastics and epoxy resins. Such plastics and resins have many valuable applications, including as components of
packaging for food and drink, and as components of certain medical products and their packaging. Consequently, low levels of residual BPA may be present in such products. On April 14, 2008, the
National Toxicology Program (NTP) released a draft brief on BPA for public comment and peer review. MassTortDefense posted about that.  The NTP draft brief raised some possible concerns that exposure to BPA could be linked to developmental problems of the endocrine system in infants and young children. The NTP draft brief also contains an exposure estimate to BPA  for infants and young children due to leaching of BPA to food from plastic  baby bottles and the linings of certain baby food containers. NTP has subsequently released a final report on  BPA on September 3, 2008.

In response to the NTP draft brief, FDA Commissioner von Eschenbach convened an agency-wide task force to facilitate cross-agency review of current research and new information on BPA for all FDA-regulated products. The review will include the NTP brief and all other available information on the exposure of US consumers to BPA from FDA-regulated products.

During the course of this process the task force has been making an inventory of all FDA-regulated products that are known to contain BPA. The task force has already completed a thorough
assessment of the potential exposure to BPA due to leaching from food-contact materials and is now expressing interest in additional information on other types of products, specifically medical devices, biological products (including blood, blood products, vaccines, and cell and gene therapies, and drugs.

For devices, in particular, FDA is asking about:

• The rate and extent of BPA release from devices under clinically relevant extraction conditions.
• What conditions affect the release and leaching of BPA?
• Estimates of patient exposure to BPA from use of the device.
• Possible alternatives to BPA and any associated risks.

 

In other BPA news, to address the “low-dose” issues that have been raised in some quarters, the Harvard Center for Risk Analysis convened a panel of scientific experts to critically review the relevant low-dose BPA studies of reproductive and developmental effects. In 2004, the Harvard Panel “found no consistent affirmative evidence of low-dose BPA effects for any endpoint.”  In 2006, the Gradient Corp. consulting group organized and participated in an expert scientific panel that conducted an updated weight-of-evidence evaluation, looking at articles published since the Harvard review and using the same methodology as the Harvard Panel.

This year, Gradient conducted yet another expert scientific panel review, again using the same methodology as the Harvard Panel, and including literature published through July, 2008. The effort was funded by the Polycarbonate/BPA Global Group and the panel’s report has been published in the peer-reviewed journal, Critical Reviews in Toxicology (Goodman et al., Weight-of-evidence evaluation of reproductive and developmental effects of low doses of bisphenol A, Critical Reviews in Toxicology, 2008). The findings of all three reviews were consistent with one another and with reviews conducted by most government bodies worldwide. As concluded overall, “The weight of evidence does not support the hypothesis that low oral doses of BPA adversely affect human reproductive and developmental health.”
 

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The FDA has issued the results of its interim safety and risk assessment of melamine and melamine-related compounds in food, including infant formula. The purpose of the FDA interim safety/risk assessment, which was conducted by scientists in the Center for Food Safety and Applied Nutrition, was to identify the level of melamine and melamine-related compounds in food which would not raise public health concerns.

For infant formula, the safety/risk assessment concludes that at this time FDA is unable to establish any level of melamine and melamine-related compounds in infant formula that does not raise public health concerns. Melamine in baby formula has sickened more than 54,000 infants in China. The government there ordered the recall of more than 10,000 tons of formula. Last week, 12 more Chinese dairy companies were named as violators after tests found 31 batches of milk powder contaminated with melamine.Chinese officials believe that the contamination was intentional and  occurred at milk collecting stations, rather than on dairy farms. MassTortDefense has posted on this before.

In food products other than infant formula, the safety/risk assessment concludes that levels of melamine and melamine-related compounds below 2.5 ppm do not raise public health concerns. This conclusion assumes a worst case exposure scenario in which 50% of the diet is contaminated at this level, and applies a 10-fold safety factor to the Tolerable Daily Intake (TDI) to account for uncertainties.

According to the CDC, melamine is a synthetic chemical with a variety of industrial uses including the production of resins and foams, cleaning products, fertilizers and pesticides. It does not occur naturally in food. Animal studies have demonstrated that exposure to low levels of melamine produced no observable toxic effects. Exposures to high levels of melamine, or exposures to lower doses of melamine together with certain other chemicals, have caused urinary tract problems in animals. These have included urinary tract and kidney crystal and stone formation, and kidney failure. Exposures of animals to high doses of melamine over long time periods (years) have been associated with cancer of the bladder.

Because melamine is a component in plastics, there may be melamine in dinnerware, cups, and even Formica counter tops. But the amount of melamine that actually transfers from those products into food is very, very small, according to FDA.

Several melamine-contaminated foods found in recent weeks in the United States had far more than that amount of the chemical. White Rabbit candies from China were recalled after authorities in at least two states found melamine. And a New Jersey company announced that it was recalling Blue Cat Flavor Drink, after FDA testing found melamine. The chemical has also turned up in dairy products sold across Asia and, to a lesser extent, Europe.

The FDA guidelines were issued to help federal and state investigators checking for contaminated Chinese products as they enter the country and in grocery stores. To date, there have been no reports of illness from contaminated Chinese milk products in the United States. There are no approved uses for melamine to be added to food in the United States.

Melamine contamination was at the center of the tainted pet food scandal that resulted in more than 80 class actions and the creation of MDL 1850.  The federal judge overseeing the multidistrict pet food litigation has just issued final approval of a $24 million settlement that seeks to resolve claims over a massive recall of more than 90 contaminated dog and cat foods last year.

 

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The FDA has announced a forthcoming meeting of the Science Board to the Food and Drug Administration, on the topic of BPA. The Science Board provides advice primarily to the Commissioner of Food and Drugs and other appropriate officials on specific complex and
technical issues as well as emerging issues within the scientific community in industry and academia.  At the meeting, on October 31, 2008, the Science Board will hear about and discuss a review of the draft assessment of Bisphenol A for use in food contact applications by the Science Board BPA Subcommittee. The Board will also hear an overview of current methods for detection of contaminants in FDA-regulated products.

In early 2008, FDA formed an agency-wide BPA task force to facilitate cross-agency review of current research and new information on BPA for all FDA regulated products. Medical devices containing the chemical are now also on the FDA’s radar screen. See the note in FDA News.  BPA is used in dialysis tubing, blood oxygenators, and dental sealants. And now that an evaluation examining migration of BPA from food contact materials has been drafted, the agency is apparently planning to publish a document assessing the safety of BPA exposure from regulated devices, biologics and pharmaceuticals.

The FDA's recent assessment was particularly focused on the concerns for developmental toxicity identified in recent assessments of BPA, including those of the National Toxicology Program and their expert panel, based on animal data. FDA concluded that this data was insufficient to merit a change in the exposure levels the agency currently allows for BPA. FDA concluded that an adequate margin of safety exists for BPA at current levels of exposure from food contact uses, for infants and adults. This assessment represents a full examination of data considered pivotal to the relevant exposure levels associated with food contact substances, the FDA said.

 

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The Pennsylvania Supreme Court last week affirmed a jury's finding that a manufacturer of chemical-containing building materials was not liable for contaminating a building with polychlorinated biphenyls (PCBs) because the alleged pollutants were spread by fire and not by any intended use of the materials. See Commonwealth of Pennsylvania v. U.S. Mineral Products Co., 2008 WL 4368569 (Pa., September 26, 2008).

The case was a product liability action arising out of alleged chemical contamination at the former Transportation and Safety Building in the Capitol Complex in Harrisburg, PA, following a fire. Plaintiff had initially secured a $90 million verdict at the conclusion of a lengthy jury trial, a decision reversed, in part, because an erroneous jury charge as to whether PCBs were distributed to surfaces throughout the T & S Building in the ordinary use of PCB-containing products, or whether the chemical was spread in smoke and soot during the severe fire. The court ruled that strict liability is available only for harm that occurs in connection with a product's intended use by an intended user, and that the incineration of building materials is not an intended use.

The second trial culminated in a defense verdict, upon a jury finding that Monsanto's product was not defective. Appeal ensued.

The court reaffirmed its ruling on strict liability and intended use. At the second trial there was substantial evidence to the effect that the PCBs found on surfaces within the T & S Building were not from the intended use of the building materials, but were spread by smoke and soot during the fire. For example, tests commissioned by defendant’s expert on pre-fire building materials showed only nominal PCB bulk-sample levels (measured in parts per million) that were many times lower than those found in similar building materials after the fire; Monsanto also offered evidence contradicting appellants' experts' theories of dissemination through ductwork operation and fabrication.

Based on this and other items of Monsanto's evidence, the jurors reasonably may have concluded that it was the fire, and not any intended use of PCBs, that was the vehicle by which PCBs were distributed to surfaces throughout the Building.

On a second issue, plaintiff below challenged the admission of evidence of its own conduct with respect to the building before the fire. Although evidence of negligence has no place in strict liability actions, Kimco Development Corp. v. Michael D.'s Carpet Outlets, 536 Pa. 1, 7-9, 637 A.2d 603, 608 (1993), evidence which is inadmissible for one purpose may be admissible for another. In this regard, the court determined that the contested evidence was relevant primarily to rebut appellants' damage claims. According to the court, the evidence of lack of a sprinkler system and other safety features was admitted to show the condition of the Building prior to the 1994 fire and detection of PCBs. The trial court had discretion to admit evidence of a lack of fire-safety features as relevant to market value.
 

Defense verdict affirmed.

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A federal court in West Virginia has denied class certification in a claim brought against DuPont for the alleged release of perfluoroctanoic acid, a substance also known as PFOA or C-8, from its Washington Works plant in Wood County, West Virginia, into drinking water. See Rhodes v. E.I. DuPont De Nemours and Co., 2008 WL 4414720 (S.D. W.Va., September 30, 2008). According to the court, plaintiffs had presented sufficient evidence that exposure to C-8 may be harmful to human health, but what “the plaintiffs misunderstand, however, is what they must show in order for me to certify the class. I cannot certify a class based on some potential harm to the general public, rather, there must be specific injuries to each member of the proposed class. The fact that a public health risk may exist … does not show the common individual injuries needed to certify a class action.”

The court viewed the plaintiffs as seeking primarily injunctive or declaratory relief in the form of a court-supervised medical monitoring program. While the likelihood of the plaintiffs' success on the merits is not relevant, the court must still engage in “rigorous analysis” to determine whether the proposed class meets the Rule 23 requirements. Gen. Tel. Co. v. Falcon, 457 U.S. 147, 161 (1982). A court may “probe behind the pleadings” to determine whether class certification is appropriate. Id.

A proposed class must be “cohesive” to be certified under Rule 23(b)(2). See Barnes v. Am. Tobacco Co., 161 F.3d 127,143 (3d. Cir.1998). This is particularly so because in a (b)(2) action, unnamed members are bound by the action without the opportunity to opt out. Barnes, 161 F.3d at 142-43. The cohesiveness requirement is similar to but “more stringent” than the commonality requirement of Rule 23(a). See Lienhart v. Dryvit Syst., Inc., 255 F.3d 138,147 n. 4 (4th Cir.2001); Barnes, 161 F.3d at 142-43.

Under West Virgina law, medical monitoring plaintiffs must first show a significant exposure. In a class action, if significant exposure is not a common issue, cohesiveness will be lacking. Exposure is significant if a plaintiff has been exposed to a larger quantity of the toxic substance or has been exposed for a longer duration than the general population. Thus, a plaintiff must be able to demonstrate that his exposure was somehow greater than what would normally be encountered by a person in everyday life.

Here, while the plaintiffs had evidence of the levels of chemical released, that evidence told the court nothing about how the plaintiffs’ C-8 exposure level compares to the level of C-8 exposure experienced by the general population. Evidence of the elevated C-8 concentrations in the named plaintiffs' blood likewise fails to show common exposure on a class-wide basis. The evidence of the higher C-8 concentration in the named plaintiffs' blood as compared to the general population suggests only that the named plaintiffs have possibly been “significantly exposed.”  Plaintiffs’ expert testimony did not provide a relevant comparison between the plaintiffs' exposure and the exposure of the general population. On this record, the general population's level of exposure to C-8 in their drinking water was unknown.

Under the second pertinent element of the medical monitoring cause of action, a plaintiff must demonstrate that her or she has suffered a significantly increased risk of contracting a particular disease relative to what would be the case in the absence of exposure. Furthermore, a plaintiff must also show that the exposure caused by the defendant was the proximate cause of that increased risk. In other words, the risk must be different and greater than it would have been absent the significant exposure at issue. Common proof of this element is always complicated because the plaintiffs must not only show that the class members have experienced a significantly increased risk but also that: 1) the risk is of a serious latent disease, 2) the defendant proximately caused that risk to each class member, and 3) the risk is significant relative to what it would have been absent the exposure.

The court agreed with DuPont’s argument that the plaintiffs could not show an increased risk of disease with class-wide proof because each class member's risk of disease will vary based upon: (a) variations in C-8 exposure and dose, and (b) variations in an individual's background risk of disease absent C-8 exposure. Plaintiffs had to concede that individual characteristics and habits will affect the level of risk experienced by each class member.

In a useful analysis, the court also explained why a regulatory risk assessment cannot and does not support an opinion that each individual class member had experienced a significantly increased risk of disease. In fact, a risk assessment is of limited utility in a toxic tort case, especially for the issue of causation, because of the risk assessment's distinct purpose. Risk assessments have largely been developed for regulatory purposes and thus serve a protection function in providing a level below which there is no appreciable risk to the general population. They do not provide information about actual risk or causation. See Bernard D. Goldstein & Mary Sue Henifin, Reference Guide on Toxicology in Federal Judicial Center Reference Manual on Scientific Evidence 413 (2d ed. 2000). Because of their appropriately prudent assumptions when there are limited data, risk assessments intentionally encompass the upper range of possible risks. Id.; see also Sutera v. Perrier Group of Am. Inc., 986 F.Supp. 655, 664 (D.Mass.1997) (rejecting regulatory standards as a measure of causation because the purpose of regulatory standards is to reduce public exposure to harmful substances); Allen v. Pa. Eng'g Corp., 102 F.3d 194, 198 (5th Cir.1996)); O'Neal v. Dep't of the Army, 852 F.Supp. 327, 333 (M.D.Pa.1994) (determining that risk figures based on the EPA's upper-bound estimates for another chemical are appropriate for regulatory purposes in which the goal is to be particularly cautious but overstate the actual risk and so, are inappropriate for use in determining whether medical monitoring should be instituted.).

Because a risk assessment overstates the risk to a population to achieve its protective and generalized goals, it is impossible to conclude with reasonable certainty that any one person exposed to a substance above the criterion established by the risk assessment has suffered a significantly increased risk. Precautionary measures to keep the general population safer are fundamentally distinct from the medical monitoring cause of action which provides relief to individuals that have already been “injured.”

Finally, on the element of need for medical monitoring, the court again found an absence of cohesion because if the individual nature of the inquiry. Plaintiffs’ expert seemed to assume that a member of the proposed medical monitoring class can have the determination of their particular and individualized diagnostic needs deferred until after the implementation of the medical monitoring protocol. While the proposed medical monitoring program was to be set up based on the “common” exposure, the implementation would be individualized. But while individualized implementation may be standard in public health monitoring programs, the tort of medical monitoring requires that determination to occur prior to a finding of liability. Plaintiffs were thus recommending a public health medical monitoring program rather than medical monitoring addressing tortious injuries to individuals. Plaintiffs thus merely deferred the individual issues that meant the class was not cohesive.
 

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At a recent nano-technology conference in Switzerland, officials from the U.S. and the U.K. reported mixed experiences with voluntary reporting schemes for the production and use of nanoscale materials. The event was NanoEurope 2008, an international specialist nanotechnology congress which attracted more than 3000 people from 22 countries. Experts from major industry segments such as Life Science, Energy, Automotive, Electronics and Textiles spoke about the latest developments in the field of material functions and processes and already established products. Also on the agenda was a Nano Regulation Conference.

Nanotechnologies are hailed by many as the next industrial revolution. They promise to change everything from the cars we drive to the clothes we wear, from the medical treatments our doctors can offer to our energy sources and workplaces. Although focused on very small particles, nanotechnologies offer large potential benefits. From new cancer therapies to pollution-eating compounds, from more durable consumer products to detectors for bio-hazards like anthrax, from novel foods to more efficient solar cells, nanotechnologies are changing the way people think about the future.Nanotechnology is unfolding enormous innovation opportunities, but also poses potential risks for humans and the environment. MassTortDefense has posted on this here and here.

In the recent past, a variety of voluntary measures such as risk management systems, codes of conduct, or disclosure agreements have emerged. The conference offered an overview of different aspects of and experiences with voluntary measures. Speakers noted variations in the quality of the reports submitted, low participation rates, and concerns about the protection of confidential business information.

For example, James Alwood, program officer in the U.S. Environmental Protection Agency's Office of Pollution Prevention and Toxics' Chemical Control Division, noted that the initial experience with EPA's Nanoscale Materials Stewardship Program (NMSP) has been positive, although the quality of the responses received has been mixed.

EPA is developing the Nanoscale Materials Stewardship Program to complement and support its new and existing chemical efforts on nanoscale materials. The program is intended to:
 

• Help the Agency assemble existing data and information from manufacturers and processors of existing chemical nanoscale materials;
• Identify and encourage use of risk management practices in developing and commercializing nanoscale materials; and
• Encourage the development of test data needed to provide a firmer scientific foundation for future work and regulatory/policy decisions.
• Encourage responsible development.

A total of 22 organizations have participated in the NMSP to date, submitting information on more than 93 nanomaterials. But EPA still needs better data to make decisions on basic issues such as the definition of nanostructure material. An interim report is due early 2009.

Steven Morgan, nanotechnologies policy advisor with the U.K. Department for Environment, Food, and Rural Affairs, described the Voluntary Reporting Scheme (VRS) for Engineered Nanoscale Materials established in the UK. Launched in September 2006, the scheme has resulted in 12 submissions to date, out of an estimated 35 British commercial businesses and 55 research institutes involved in nanotechnology. Business confidentiality remains an issue, particularly with a such a hot new technology. U.K. authorities apparently are already looking to bring the nanotechnology sector within the EU’s REACH regulations ("registration, evaluation, and authorization of chemicals") by 2012.
 

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Quality control investigators in China have announced they had found a dangerous protein substitute in dairy products produced by 20% of the Chinese companies that make infant formula. Reports are that more than 12,000 children had been hospitalized, most with kidney ailments, and 40,000 with less severe symptoms have been treated without admission. At least three have been killed.

Melamine, a protein imitator that is toxic, was used as a cheaper fill, and was found in the test samples. Melamine is the same protein replacement used in the Chinese-made pet food that killed thousands of cats and dogs last year.

What is the impact for readers of MassTortDefense? Several major Chinese dairy companies involved have international investors. But none of the formula products were exported to North America. The FDA said there is no known threat of contamination in infant formula manufactured by companies that have met requirements to sell the formula in the United States. However, FDA is investigating whether infant formula manufactured in China is being sold in markets here that serve the Asian community. And the FDA is alerting consumers that seven "Mr. Brown" instant coffee and milk tea products are being recalled by a Taiwanese company, due to possible contamination with melamine.

The developing food safety scandal has called into question, yet again, the effectiveness of China’s quality control system in general, and the country's new food safety regime in particular. Last year’s spate of product recalls, including drugs, toys, pet food and tires, placed the spotlight on China's quality control problems. MassTortDefense has posted on this here and here. Now comes the news that the newly enacted food safety recall system was not activated for at least two weeks after the problem became known to local officials, and the prime minister of New Zealand (an importer) charged the matter was covered up for several weeks while the Beijing Olympics were underway. Thus, thoughts naturally turn to efforts importers may mitigate the risks. A recent article in Risk Management Magazine offers a broad perspective on this. (Kent Kedl, Risk Strategies for the Chinese Market , published by the Risk and Insurance Management Society, which targets corporate risk managers.) At bottom, it is risk management to avoid a potential mass tort.

First, plan Strategy before Structure. In recent years, the Chinese government has changed its investment regulations to allow --and even encourage-- a variety of business arrangements, from strategic partnerships to wholly foreign-owned enterprises, to full acquisitions. RM suggests that companies coming to China must first ignore the "how" of structure and first focus on the "why" of their strategic intent for China: What products will have the most play? What segments of the market should they target? What distribution channels should they use? Who will be the major competition and how can they structure a defensible and sustainable value proposition?

Second, they advise companies to Get Close to the Market. Clearly, there are Chinese factories that have had quality issues, but the fact remains that there are millions of products coming out of China every month, most of which have no problems whatsoever. Maybe, then, the question should be how best to manage product quality, because someone is doing it right. Kedl and RM suggest that foreign companies need to manage their vendors on an ongoing basis. Meet with suppliers; validate the supply chain; don’t worry about price and on-time delivery to the exclusion of all else. Companies sourcing from China should consider putting their own people on the ground to manage their supply chain, establish and monitor their own quality systems, and maintain ongoing relationships with the vendors. This approach may raise a company's fixed costs but, in the long run, may greatly lower the risk associated with having products made in an emerging market.

Third, recognize that Relationships Matter. Early successful foreign entrants to China worked hard to build a relationship network for themselves. As China has developed a more credible legal framework and a more predictable market environment, however, foreign companies too often have believed they no longer need that social network and that, instead, they can do it on their own. RM suggests that may be a mistake.

Ongoing events put a premium on efforts by both China and the U.S. in implementing the 2007 Memorandum of Agreement (MOA) on food and feed safety. The MOA established a bilateral mechanism to provide greater information and other assurances to enhance the safety of food and feed products traded between the two countries. The countries have improved the exchange of information on food safety and on the relevant regulatory systems. The U.S. has agreed to conduct training for Chinese officials on U.S. regulatory standards. Each has designated new emergency contacts and notification thresholds for import safety issues. The two countries have also been working towards an electronic certification system between the FDA and China's General Administration of Quality Supervision, Inspection and Quarantine to ensure that Chinese exports meet FDA standards for safety and manufacturing quality. The countries also agreed to increase their focus on inspection, supervision and laboratory testing of Chinese imports. Finally, the report described the establishment of a cooperative mechanism to notify each other of significant risks to public health related to product safety or the gross deception of consumers, and to share information to facilitate each other’s investigation.
 

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Here is the latest on BPA:

1. NTP Issues Final Report

The National Toxicology Program issued its final report on bisphenol A (BPA) earlier this month. NTP continued its position from a much publicized draft report (see the post here) that it has some concern that the chemical – used in plastic bottles and other packaging -- could affect the development of the prostate gland and brain and potentially affect the behavior of fetuses, infants, and children. See The Monograph on the Potential Human Reproductive and Developmental Effects of Bisphenol A.

The report provides the NTP’s current opinion on BPA’s potential to cause harm to human reproduction or development. The report is part of a review of the scientific literature on BPA and takes into consideration public and peer review comments received on the earlier draft report. According to NTP, about 2.3 billion pounds were produced in the United States in 2004, with more than 90 percent of the population being exposed to the substance.

The conclusions are based primarily on animal studies. The literature on experimental animal studies is filled with many conflicting findings, NTP says. And NTP admits that there remains considerable uncertainty whether the changes seen in the animal studies are directly applicable to humans, and whether they would result in clear adverse health effects. NTP also states that more research is clearly needed to understand exactly how these findings relate to human health and development. There are a number of remaining uncertainties in the scientific information on BPA, according to the report.

The NTP is an interagency federal research program at the National Institute of Environmental Health Sciences, part of the National Institutes of Health. The report uses a five-level scale ranging from negligible risk to serious concern.

The report expresses “minimal concern” that BPA exposure will affect development of the mammary gland or accelerate puberty in females. (Previously, NTP said it had some concerns about those effects, but a panel of experts concluded that the program overstated its concerns about mammary gland effects and early puberty.) The NTP expressed “negligible concern” that exposure of pregnant woman to BPA will result in fetal or neonatal mortality, birth defects or reduced birth weight and growth in their offspring. And the report also expressed “negligible concern” that exposure to BPA causes reproductive effects in non-occupationally exposed adults and “minimal concern” for workers exposed to higher levels in occupational settings.

The FDA responded to the final report, noting that it would consider this final report at FDA's Science Board meeting concerning the FDA’s draft assessment of bisphenol A.  Which brings us to development No.2.

2. FDA Meeting
FDA held a public meeting last week, with a range of scientists, industry representatives, and consumer advocates debating aspect of bisphenol A usage.

The focus of the meeting was the FDA’s draft risk assessment that found continued use of bisphenol A in food-contact materials would be safe. Among the highlights:

An EPA toxicologist who served on NTP's expert panel said the NTP's statements that it has "some concern" meant more research was needed. It did not imply that the NTP expert panel had concluded that harm was being caused by the chemical.

A toxicologist working at the National Institute of Environmental Health Sciences said that NTP reported it had "some concern" about neurological, behavioral, and prostate effects because the animal studies that found those effects involved exposures at levels similar to those expected for infants.

The head of the pediatrics department of the Medical College of Wisconsin suggested that FDA conduct or fund more exposure research to get a better understanding of infants' exposure. FDA’s estimates and NTP’s estimates of typical exposure were slightly different.

A representative of the polycarbonate business unit of the American Plastics Council noted that there have been at least two studies of bisphenol A levels in infant formula since FDA completed its study, including one by the Environmental Working Group. All have found levels comparable to what FDA used.

Other speakers noted that BPA is a relatively well studied chemical, and compounds that could be used as substitutes are unlikely to have as much information available about their safety. Clearly, some uses of bisphenol A, such as in children's bicycle helmets, provide many safety benefits. BPA has also been found to be safe with an unmatched performance in lining cans. The Environmental Working Group, said there are substitutes, in their view, already on the market for uses such as in baby bottles.

A toxicologist from the University of Missouri-Columbia worried that FDA's recommended tests might mean it would take many more years before the agency might take any necessary regulatory action to reduce exposure.

John van Miller of the American Chemistry Council, cited the multi-dose, multigenerational, significant studies conducted in accordance with internationally agreed-upon protocols that have found bisphenol A to be safe. The "Reproductive Health Technologies Project" disagreed and underscored the need for studies in their view.

The Bisphenol A Subcommittee is to brief FDA's Science Board later this Fall on the subcommittee's recommendations. The Science Board will then develop its own recommendations for BPA.

3. JAMA Study
The Journal of the American Medical Association published a study last week which has been reported in the popular press as showing that subjects with higher levels of bisphenol A in their urine were more likely to report that they had heart disease or diabetes. See Association of Urinary Bisphenol A Concentration with Medical Disorders and Laboratory Abnormalities in Adults.

Higher levels of human urinary BPA were reportedly associated with cardiovascular disease, type 2 diabetes, and liver-enzyme abnormalities, according to the study, which was discussed at the FDA public meeting. The study used data from the National Health and Nutrition Examination Survey (NHANES) 2003-2004. The survey involved the measured urinary bisphenol A concentrations of 1,455 adults, ages 18 through 74 years. 
 

The investigators noted that orally administered BPA is rapidly and completely excreted by humans.  On of the limitations of the analysis is its cross-sectional nature: it does not offer longitudinal data demonstrating that BPA concentrations predict later onsets of biochemical change or disease. The authors cautioned that their method may have resulted in false-positive associations. The authors have recommended an independent replication of the study, and follow-up studies to explore their findings and to provide evidence on whether the associations are causal. Not well reported in the media is the fact that the research team used four methods to measure whether bisphenol A was associated with diabetes, but found that association in only one of the four methods. The study thus is primarily useful for generating hypotheses that can be tested, not for drawing any conclusions on human health effects.

 

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California – already one of the most aggressive states in regulating chemicals – has passed legislation designed to give state regulators new authority to regulate chemicals in consumer products. The bills are the companion measures, A.B. 1879 and S.B. 509. The state Senate approved its bill late last month. The Governator is expected to sign them in the near future.

The legislation is part of a so-called “green chemistry” initiative, launched more than a year ago. The program is designed to change the state's current chemical-by-chemical regulatory approach and focus on identifying chemicals of concern and exploring opportunities for safer alternatives before they are in widespread use.

The state Department of Toxic Substances Control conducted a series of public workshops and expert meetings to gather ideas on how to implement the initiative. One of the outcomes is the new legislation.  The bills, first, would give the state Department of Toxic Substances Control two years to develop a plan to identify and evaluate chemicals of concern and study alternatives to the chemicals. The measure requires the creation of a "Green Ribbon Science Panel" to advise the department in this task.

Second, the state would have authority to restrict use or ban chemicals from being used in consumer products in the first place – as opposed to regulating a chemical after it has been used as an ingredient. The bill proposes creation of a process to evaluate products for green chemistry regulation, including a multi-factorial life-cycle set of criteria to be considered, including the product’s manufacturing process, use characteristics, and its waste and end-of-cycle disposal.  Specific regulatory outcomes might range from disclosure of additional information regarding a chemical of concern and its potential alternatives; labeling or other types of consumer product information sharing; restrictions on the use of the chemical; to outright prohibition of the use of the chemical.

Third, the bills would require the department to create an Internet-based, publicly accessible Toxics Information Clearinghouse for data on chemicals and potential hazards. 

Some lawmakers supported the legislation because it would take the job of banning chemicals out of the hands of the state legislature. Clearly, the proactive philosophy of the legislation, as opposed to reacting to possible risks after the fact, appealed to some others. If the approach, and particularly the expert panel, takes some of the public hysteria and media frenzy out of the process, there may be an improvement to the rationality of the process. The product’s potential functions and the economic impact of regulating the chemical are supposed to be relevant factors considered.

Whether the green chemistry initiative has a significant impact on mass tort and toxic tort litigation remains to be seen. A more rational, science-based approach could curtail risks and undermine frivolous suits where general causation – the ability of the chemical to cause a disease – is far from clear.

The text of A.B. 1879 and S.B. 509 is available here.  

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The FDA held a public meeting on September 8, 2008, to gather information that will assist the agency in further implementing the recommendations of the Nanotechnology Task Force Report relating to the development of agency guidance documents concerning nanotechnology. In July 2007, FDA had issued a report analyzing scientific and regulatory considerations relating to the safety and effectiveness of FDA-regulated products containing nanoscale materials regulated by FDA, and making recommendations regarding these considerations. The Nanotechnology Task Force Report made recommendations which covered foods (including dietary supplements), food and color additives (including food contact substances), animal drugs and feeds, cosmetics, human drugs and biologics, and medical devices. Additionally, the Report summarized the state of the science for biological interactions with nanoscale materials.

The meeting included a plenary session led by Dr. Norris Alderson, head of the FDA Nanotechnology Task Force, followed by separate sessions for prescription and OTC drugs, cosmetics, medical devices, food additives, and others. FDA speakers reportedly were interested in comments on the circumstances under which the regulatory status of a product might change if nanoscale materials were utilized instead of the traditionally sized materials evaluated by regulatory officials when the product was first approved. 

Andrew Maynard, the chief science adviser for the Project on Emerging Nanotechnologies, told the FDA at the September meeting that they should view products containing nanomaterials as potentially "risk-added." Maynard said that materials with a dimension less than 100 nanometers exhibit unique properties due to their small size, and thus are “value-added." But, Maynard said, the unique properties exhibited by nanomaterials might also carry special risks. Francis Quinn, speaking on behalf of the Personal Care Products Council, offered a different perspective. For example, while nanoparticles are used in the early stages of developing sunscreens, by the time they are mixed with other ingredients they are no longer nanoscale and present no different risks than traditional sunscreens. Jay Ansell, senior director of the council, said no special labeling of nanoscale ingredients in cosmetics is needed.

But other speakers said the FDA needs to take a different approach as it contemplates regulating products containing nanoscale ingredients. The Conservation Law Foundation said that existing frameworks for assessing risks need to be updated to address nano-specific attributes such as particle characteristics. And a researcher from The George Washington University urged caution about the use of nanomaterials in dietary supplements.

As an aside, the latest report from the Project on Emerging Nanotechnologies addresses nano-scale silver. Silver Nanotechnologies and the Environment: Old Problems or New Challenges. The most common nanotechnology material currently used in the products is silver, which is mentioned in 235 product descriptions, such as silver-containing socks, baby carriages, air filters, coin-operated washing machines, and swimming pool treatments. 

The report asserts that widespread use of nanoscale silver will challenge regulatory agencies to balance important potential benefits against the possibility of significant environmental risk, highlighting the need to identify research priorities concerning this emerging technology. The issue of assessing the risks posed by nanoscale silver was highlighted after the Environmental Protection Agency’s (EPA) San Francisco office earlier this year imposed a fine of $200,000 on a California company selling computer keyboards and mouses coated with nanosilver. EPA issued the fine on the basis that the products should have been registered under federal pesticide law because of the company’s germ-killing claims. Due to its antibacterial properties, some have argued that the Federal Insecticide, Fungicide, and Rodenticide Act may be used to regulate many uses of nanoscale silver.

Nanosilver is a new challenge, says the report, a problem that fits poorly into the old boxes of the existing regulatory system. EPA is crafting a Federal Register notice that will invite comment on a citizen’s petition on nanoscale silver. EPA also has a 2007 white paper on nanotechnology.
 

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A federal district court has declined to certify a proposed class action involving as many as 33,000 residents living near a Kentucky manufacturing plant. Cochran v. Oxy Vinyls, 2008 WL 4146383 (W.D. Ky. Sept. 2, 2008). For readers of MassTortDefense, an interesting feature of this proposed toxic tort class action was the court’s focus on the proposed class definition.

Plaintiffs, residents of neighborhoods surrounding an industrial area known as “Rubbertown,” alleged that emissions from defendant's operations in its nearby plant invaded their property in the form of particulate matter fallout and noxious odors. Defendant operated a plant in the Rubbertown area, at which it manufactured polyvinyl chloride resins (“PVC”); but defendant's plant is only one of several industrial facilities in the Rubbertown area.

Plaintiffs filed their complaint in 2006, alleging nuisance, negligence and/or gross negligence, strict liability for ultrahazardous activities, and trespass. Plaintiffs moved for class certification under Federal Rules of Civil Procedure 23(b)(2) and 23(b)(3), for a class defined as including owners or residents of single family residences within two miles of the Oxy Vinyls facility, who allege the invasion of their property….a circular and largely geographic-based definition.

The court rejected this proposed definition. Although not specifically mentioned in Rule 23, the proper definition of the class is an essential prerequisite to maintaining a class action. The class must be sufficiently definite that it is administratively feasible for the court to determine whether a particular individual is a member. Courts have rejected certifying proposed classes where plaintiffs failed to identify any logical reason for drawing the class boundaries where they did. See, e.g., Daigle v. Shell Oil Co., 133 F.R.D. 600, 602-03 (D .Colo.1990) (holding that the plaintiffs had “failed to identify a class” where the proposed boundaries did not appear to “relate to the defendants' activities,” but were instead “arbitrarily ... drawn lines on a map”).

After an initial failed stab at certification, plaintiffs supplemented their effort with the expert report of an industrial hygienist, Roger Wabeke, who spent two days collecting air and settled dust samples in the neighborhoods immediately around the plant operated by Oxy Vinyls in an effort to tie the plant's alleged particulate pollution to the proposed class. The court's review of the record, even as supplemented by Mr. Wabeke's report, revealed an insufficient relationship between the proposed class definition and the evidence provided regarding the alleged emissions of the facility. The court concluded that Mr. Wabeke's report utterly failed to substantiate any sort of evidentiary relationship among the proposed class members that would justify certification of the proposed class.

The Wabeke report had numerous infirmities, but the most significant to the court was that the dust and air samples he collected were "virtually meaningless." The court noted that its rigorous review of the scientific evidence was not an inquiry into the merits, but rather a careful analysis of the Rule 23 prerequisites. Mr. Wabeke's report was “stunningly inadequate.” Far from a proposed class definition that was “objectively reasonable,” plaintiffs had offered no meaningful evidence that airborne contaminants from Oxy Vinyls spread in a uniform fashion in all directions from defendants' facility for a distance of up to two miles, or really that they spread that far from Oxy Vinyls at all. Therefore, the court was left without a basis upon which it could properly conclude that the members of the proposed class were distinguishable from the general public. For example, plaintiffs offered no way in which the proposed class members would be distinguished from those whose property may have been damaged by similar emissions from other facilities.

The faulty class definition also infected other elements of the Rule 23 analysis. Numerosity is inextricably bound up in the question of class definition. Thus, a flawed class definition can make it difficult to determine whether a class defined by geographical boundaries satisfies the numerosity requirement; indeed, courts faced with overbroad proposed classes have rejected plaintiffs' numerosity arguments due to this difficulty.

Similarly, the court was unable to conclude that named plaintiffs represented an adequate cross-section of the proposed class. For example, a proposed class member's lesser proximity to defendant's facility or closer proximity to one of the other facilities in the area may completely eliminate defendant's liability for the alleged harm they experienced. Mr. Wabeke's report provided no assurance of typicality, since the samples taken of settled dust were clearly and admittedly not “typical” of anything.

As for Rule 23(b)(3), the critical evidence of causation would be based upon highly individualized testimony. Thus, the Court was not at all convinced that defendant's liability to the class would involve predominating common issues or that a class action would be the superior method of adjudicating plaintiffs' claims.

The court concluded that Rule 23 and the vast majority of other mass tort cases “do not support the idea that simply by demanding a class and filing a document styled as an expert report a group of plaintiffs are thereby entitled to certification of whatever class they propose.”
 

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The 8th Circuit has upheld the trial court’s decision that a plaintiff who alleged she was injured by drinking water from a bottle filled with freon did not have adequate and valid expert evidence of causation. Bland v. Verizon Wireless, 2008 WL 3474178 (8th Cir. August 14, 2008).

Plaintiff alleged that she inadvertently left her water bottle behind in a store, and an employee of defendant sprayed compressed air into her water bottle “as a joke,” believing the water bottle belonged to a fellow employee. At home, plaintiff opened the bottle which “made a-kind of pressurized noise.” She took a drink, then decided to smell the contents, taking a big whiff which made her cough. She then allegedly took another drink.

Plaintiff later reported to her doctor that after drinking from the bottle she coughed, which persisted for nearly an hour. She also described a “sore sensation in her throat” and for the next few days a “raspy sensation in her lungs.” Plaintiff alleged she developed a headache which persisted for about two weeks. Later testing at the University of Iowa Lab determined the bottle contained 820 parts per million (ppm) (.08%) of difluoroethane, a freon compound.

Plaintiff was later seen by a Dr. Sprince, complaining of shortness of breath when running. Her lung function test results were basically normal. Dr. Sprince eventually diagnosed her as having “exercise-induced asthma.” Dr. Sprince later theorized that “[b]ased on the initial clinical findings, [a] strong temporal relationship between the inhalation of freon and the occurrence of respiratory symptoms, and the subsequent response to pre-exercise treatment with inhaled bronchodilator” that plaintiff's exercise-induced asthma was caused by the inhalation of freon.

Plaintiff sought to use the testimony of this treating physician, Dr. Sprince, to establish a causal link between inhalation of freon and the alleged exercise-induced asthma. The district court excluded Dr. Sprince's testimony because Dr. Sprince's proffered testimony as to causation did not satisfy the standards for admission of expert scientific testimony under Daubert.

The 8th Circuit affirmed, noting first that a treating physician's expert opinion on causation is subject to the same standards of scientific reliability that govern the expert opinions of physicians hired solely for purposes of litigation.

The first problem with Dr. Sprince's causation testimony was that she failed scientifically to eliminate other possible causes as part of her differential diagnosis. In particular, her own testimony acknowledged the cause of exercise-induced asthma in the majority of cases is unknown. Where the cause of the condition is unknown in the majority of cases, an expert cannot properly conclude, based upon a simple differential diagnosis, that exposure, here to freon, was the most probable cause of the injury. As a practical matter, Dr. Sprince's causation opinion could not possibly be based upon a reasonable degree of medical certainty. Where the majority of cases of exercise-induced asthma have no known cause, and where Dr. Sprince failed to do an investigation and analysis of plaintiff's home or other environments in search of other possible causes, the district court did not abuse its discretion in determining Dr. Sprince's differential diagnosis did not satisfy Daubert.

Second, plaintiff’s expert did not know what amount of exposure to freon causes, or involves an appreciable risk of causing, asthma, and had no good grounds for determining whether plaintiff  was exposed to a sufficient dose to have caused her asthma. Dr. Sprince could not determine or estimate the amount of freon plaintiff was actually or probably exposed to. The expert could not extrapolate from the existing data because the gap between the data identified (exposure facts) and Dr. Sprince's proffered opinion was simply too great an analytical gap to support admissibility. Critical to a determination of causation is characterizing exposure. In a toxic tort case, the magnitude or concentration of an exposure should be estimated and the temporal aspects of the exposure should be determined --whether the exposure was short-term and lasted a few minutes, days, weeks, or months, or was long-term and lasted for years. Dr. Sprince lacked knowledge regarding what level of exposure to freon constitutes an appreciable risk of causing asthma and the specific concentration and degree of exposure to the freon. Similarly, plaintiff’s expert did not offer as evidence any personal experience with treating other patients following a similar exposure, admitting she had no such experience.

Finally, the expert’s heavy reliance on temporal proximity, without more, was insufficient to establish causation. In the absence of an established scientific connection between exposure and illness, or compelling circumstances, the temporal connection between exposure to chemicals and an onset of symptoms, standing alone, is entitled to little weight in determining causation. See Moore v. Ashland Chem., Inc., 151 F.3d 269, 278 (5th Cir.1998). It is not always irrelevant, said the court. The temporal relationship often will be one of several factors, and the weight to be given to the temporal relationship will differ depending on the strength of that relationship. But in this case, the district court properly discounted all the other factors supporting Dr. Sprince's opinion leaving only temporal proximity to support Dr. Sprince's causation opinion. And that was not enough, especially when plaintiff did not make an appointment with a doctor until two to three weeks after the incident.
 

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For those readers of MassTortDefense interested in the issues surrounding BPA, the FDA has announced a meeting of its Bisphenol A (BPA) Subcommittee of the Science Board.

The topic to be discussed is the draft assessment of BPA for use in food contact applications. The Subcommittee will hear and discuss the draft assessment of BPA for use in food contact applications, including oral presentations from the public. The meeting will be held on September 16, 2008.

The FDA draft assessment report finds that the chemical does not pose a serious health risk under current uses. The new assessment was particularly focused on the concerns for developmental toxicity identified in recent assessments of BPA, including those of the National Toxicology Program and their expert panel, based on animal data. FDA concluded that this data was insufficient to merit a change in the exposure levels the agency currently allows for BPA. FDA concluded that an adequate margin of safety exists for BPA at current levels of exposure from food contact uses, for infants and adults. This assessment represents a full examination of data considered pivotal to the relevant exposure levels associated with food contact substances, the FDA said.
 

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Professor Lester Brickman, of Cardozo School of Law, has published a fascinating article entitled, "The Use of Litigation Screenings in Mass Torts: A Formula for Fraud?"

At MassTortDefense, we would simply remove the question mark.

Plaintiff lawyers obtain the "mass" for some mass tort litigation by conducting screenings to sign-up potential litigants. These "litigation screenings" have no intended medical benefit, and thus this entrepreneurial response to highly profitable opportunities that arise in certain mass tort litigation should not be confused with true medical screening. In a litigation screening, potential litigants are solicited by lawyers or their agents by use of mass mailings, television and newspaper advertisements providing “800” telephone numbers, and by use of web sites purporting to provide medical information about toxic exposures, drugs, devices, or specific diseases but which are, in fact, “fronts” for law firms to whom the web site visitor is referred.

Screenings can be held in motels, shopping center parking lots, local union offices, and even lawyers' offices. There, an occupational history is taken by persons typically with no medical training, a doctor may do a cursory physical exam, and non-doctor technicians administer tests, such as X-rays, pulmonary function tests, echocardiograms and blood tests. The sole purpose of screenings is to generate "medical" evidence of the existence of an injury to be attributed to exposure to or ingestion of defendants' products – all pre-planned. Usually a handful of doctors ("litigation doctors") provide the vast majority of the thousands of medical reports prepared for that litigation.

By the good professor’s count, at least 1,500,000 potential litigants have been screened in the asbestos, silica, fen-phen (diet drugs), silicone breast implant, and welding fume litigation. Litigation doctors found that approximately 1,000,000 of those screened had the requisite condition that could qualify for compensation under plaintiffs’ legal theory, such as asbestosis, silicosis, moderate mitral or mild aortic value regurgitation or a neurological disorder. He further estimates that litigation doctors and screening companies have been paid well in excess of $250 million – huge number, but a tiny fraction of the contingency fees earned well in excess of $13 billion by his estimates.

The professor concludes that approximately 90% claims generated from the screenings were based on "diagnoses" of the type that U.S. District Court Judge Janis Jack, in the silica MDL, found were "manufactured for money."

He also presents the case that bankruptcy courts adjudicating asbestos related bankruptcies have effectively legitimized the use of these litigation screenings.

Professor Brickman's areas of expertise include legal ethics, contingency fees, mass torts, and asbestos litigation. He notes the significant volume of literature about the use of junk science in the court, even today, especially to try to prove general causation in mass torts. But his analysis is particularly valuable because it turns an empirical light on the use of litigation screenings to try to prove specific causation.
 

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The U.S. Food and Drug Administration has released a draft report finding that the chemical bisphenol A does not pose a serious health risk. BPA is used in several products, including some plastic baby bottles, food containers, and water bottles. The chemical is added to make polycarbonate plastic bottles clear and shatterproof.

As MassTortDefense has noted before, and here, BPA has been much in the news. In May, 2008, FDA officials told a congressional panel that the agency had no reason to recommend that consumers stop using products containing BPA.  FDA has been examining the data on BPA in anticipation of a September meeting on the issues surrounding the potential toxicity of the chemical. The new draft document will be reviewed by the Bisphenol A Subcommittee of the FDA Science Board on Sept. 16th. Details on the science panel's meeting can be found here.

The new assessment was particularly focused on the concerns for developmental toxicity identified in recent assessments of BPA, including those of the National Toxicology Program and their expert panel, based on animal data. FDA concluded that this data was insufficient to merit a change in the exposure levels the agency currently allows for BPA. FDA concluded that an adequate margin of safety exists for BPA at current levels of exposure from food contact uses, for infants and adults. This assessment represents a full examination of data considered pivotal to the relevant exposure levels associated with food contact substances, the FDA said.

To avoid underestimating risk, FDA said it made the conservative assumption that an infant drank only formula from cans lined with a bisphenol A-based enamel coating and that the parents heated that formula in polycarbonate baby bottles. Based on such assumptions, FDA estimated that an infant might consume up to 2.42 micrograms bisphenol A per kilogram body weight. Based on animal studies, FDA estimated that the no observed adverse effect level (NOAEL) for bisphenol A would be 5 milligrams per kilogram body weight. That means the margin of exposure, or the difference between infants' exposure and the NOAEL, is about 2,000x. That is, FDA said, "an adequate margin of safety...."

FDA's draft conclusion is consistent with the European Food Safety Authority's July 23 statement that it considers current uses of bisphenol A to be safe. FDA's draft assessment called for more research, and said data from nonhuman primates would be helpful, along with measurements of bisphenol A in the U.S. population. 
 

In other BPA news, the California Assembly rejected a bill (S.B. 1713) that would have banned bisphenol A in children's products, specifically BPA at levels above 0.1 part per billion in baby bottles, cups, food containers, or any other container designed for children under the age of 3 years. By Jan. 1, 2012, S.B. 1713 would have barred the sale of any liquid, food, or beverage in any can or jar containing 0.5 ppb or more of bisphenol A. The American Chemistry Council and numerous experts have contended the products the bill would ban are safe.
 

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The U.S. District Court for the Western District of Missouri has dismissed a medical monitoring claim brought against the manufacturer of a medical device, finding that the applicable state law permits such a claim only in a true toxic tort case. Ratliff v. Mentor Corp., 2008 WL 3126300 (W.D. Mo.,  Aug. 5, 2008).

Plaintiff Toni Ratliff had a Mentor UB-Tape sling surgically implanted in her pelvis area to treat a condition. She brought a putative class action, including “all persons or entities in the State of Missouri who were treated, implanted or otherwise received the UB-Tape, designed, tested, manufactured, distributed and/or sold by Mentor Corporation.” Excluded from the class were all people with claims for personal injury or wrongful death. She alleged the device caused extrusions, infections and abscesses, often requiring secondary surgical procedures to correct the problem.

The relief sought included a notification, research, and medical monitoring fund for tests to catch those problems. Mentor moved to dismiss, arguing that a medical monitoring claim is not recognized in Missouri outside of the toxic torts context.

The court noted that Meyer v. Fluor Corp., 220 S.W.3d 712 (Mo. 2007) is the first and only Missouri Supreme Court case dealing with medical monitoring claims. It has been cited for the general proposition that Missouri recognizes a claim for medical monitoring. However, in Meyer, children allegedly exposed to lead sued smelter operators to recover damages for the expense of medical monitoring. The Missouri Supreme Court held that the children were entitled to recover such damages under a “medical monitoring claim” that “seeks to recover the costs of future reasonably necessary diagnostic testing to detect latent injuries or diseases that may develop as a result of exposure to toxic substances.” Id. at 716. Thus, by the Missouri Supreme Court’s own definition of a medical monitoring claim, the Meyer decision does not apply to potential latent injuries resulting from anything other than exposure to toxic substances.

The strict holding of Meyer is that, in Missouri, medical monitoring claims are available in toxic tort cases. Meyer does not necessarily support recognition of medical monitoring claims in garden variety products liability cases like plaintiff contended. This explicit limitation in Meyer led the district court to believe that the Missouri Supreme Court would dismiss medical monitoring claims that do not result from exposure to toxic substances.

Although the court did not get into policy issues, MassTortDefense notes that there is a growing recognition that medical monitoring should not be available in the context of drugs and medical devices. The voluntary use of a medical device or medicine prescribed by a health care professional is arguably far removed from the original medical monitoring notion of involuntary exposure to a chemical in the environment. In a case involving HRT, Vitanza v. Wyeth, Inc., 2006 WL 462470 (N.J. Super. Ct. Jan. 24, 2006), plaintiffs sought class certification of a group defined as all persons in New Jersey who had taken the drug Prempro and were not suffering from breast cancer, but who wanted medical monitoring for an alleged increased risk of future cancer. The court dismissed the claim, noting that the state's recognition of medical monitoring came in the unique context of manifest exposure to toxic substances in environmental tort actions, and was to be applied sparingly. The policy reasons applicable to the environmental exposure context (including the difficulty in proving exposure levels and duration, and even the identity of the chemicals at issue) are not present in the prescription drug context where claimants have access to relevant information through the label, pharmacy records, and their prescribing physician. The need to deter polluters, perceived to be present in the toxic tort context, does not apply to life sciences companies selling a product screened by the FDA.

The absence of these policy factors in a life sciences context was also observed in a recent Vioxx case. Sinclair v. Merck & Co., 195 N.J. 51, 948 A.2d 587 (N.J. 2008). The state supreme court ruled as a matter of law that plaintiffs could not maintain an action for medical monitoring in a pharmaceutical product liability action because they did not allege a presently manifested injury. The court held that the New Jersey Products Liability Act requires present manifest injury and therefore bars medical monitoring unless the present manifest injury element is satisfied. The court also examined prior precedents where medical monitoring was approved, and found those precedents were limited to personal injury stemming from asbestos exposure and exposure to environmental contamination. The majority declined to recognize any common law medical monitoring remedy. See also Parker v. Howmedica Osteonics Corp., 2008 WL 141628, at *5, n.6 (D.N.J.,  Jan.  14, 2008)(applying similar reasoning to device context). Similarly, in Conway v. A.I. DuPont Hosp. for Children, 2007 WL 560502 (E.D. Pa., Feb. 14, 2007), the court denied the defendant's motion to dismiss a medical monitoring claim regarding a medical device used in children with congenital heart defects. The court did, however, note that while medical monitoring was "suitable" in toxic substance exposure cases, the "same argument cannot be made for medical monitoring relief in products liability cases where diseases" are not caused by exposure to toxic substances.
 

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A federal court has weighed in on the issue of exposure in a toxic tort property damages suit, denying summary judgment and finding the presence of vinyl chloride in the air, even if undetectable, may constitute a physical injury to property under a common law property damage claim. Gates v. Rohm and Haas Co., 2008 WL 2977867 (E.D.Pa., July 31, 2008 ).

Plaintiffs in this putative class action sued Rohm and Haas and others pursuant to CERCLA, and state law, for damages allegedly resulting from contamination of their drinking water by pollutants that the Defendants allegedly generated and released. The proposed property damage class consisted of  about 500 "persons who presently own real property within McCollum Lake Village (‘Village’), or who owned real property within the Village as of April 25, 2006 through the present.” Defendants filed a motion for partial summary judgment with respect to the plaintiffs' common law property claims: public and private nuisance, negligent and intentional trespass, strict liability, negligence and negligence per se for damages arising out of alleged continuing airborne vinyl chloride contamination and past groundwater contamination.

The plaintiffs contended that this alleged “physical invasion” of their property by a carcinogenic contaminant caused a diminution in value of their property, in part due to the stigma caused by the alleged contamination. Rohm and Haas argued that applicable (Illinois) law does not recognize a cause of action for “economic harm” absent physical damage. The plaintiffs' property damage claim thus should fail because there was no evidence in the record of any physical injury to accompany the alleged economic injury (the diminution in value of the property due to supposed “stigma” associated with the alleged contamination).

According to the court, the first issue was the basic factual question of whether there was sufficient evidence of “present” contamination. The second issue was whether any such contamination constitutes a “physical injury.” And, finally, the third issue was whether diminution in value is an appropriate measure of damages based on the type of harm alleged.

A. “Present” Contamination
It was undisputed that at present no vinyl chloride or vinylidene chloride has been detected in any well in McCollum Lake Village. And it is undisputed that any alleged groundwater contamination was purely historical. It was unclear, however, to the court whether under Illinois law such past physical injury, coupled with ongoing alleged economic harm, suffices to permit pursuit of economic losses in tort. The fundamental factual question here for the court was whether there was sufficient evidence of permanent or ongoing physical injury to the plaintiffs' property. Although defendants made a strong showing, the court found a genuine dispute as to whether present levels of airborne vinyl chloride in McCollum Lake Village are below background levels and, accordingly, whether there is current airborne vinyl chloride “contamination.”

B. “Physical” Injury
Even assuming past and present vinyl chloride exposure, the court had to determine whether such exposure constitutes a “physical injury” for purposes of stating common law tort claims. The court reasoned that the presence of harmful chemicals in property loss actions is treated differently than the presence of non-hazardous materials. Notably, there is no requirement that a hazardous chemical be perceptible to the senses. The presence of an undetected hazardous chemical can support a claim for nuisance, thought the court. That the chemical is not immediately perceptible to the senses is not dispositive when when there is evidence of actual physical invasion of class area property.

Moreover, said the court, in contrast to the standards for medical monitoring claims, the exposure level need not necessarily present a health risk to make out a property damage claim. Such a view is not unanimous in the courts. E.g., Rockwell Int'l Corp. v. Wilhite, 143 S.W.2d 604, 620, 627 (Ky.App.Ct.2003); Rose v. Union Oil Co., No. 97-2808, 1999 U.S. Dist. LEXIS 967, at *3-4, *17 (N.D.Cal. Jan. 29, 1999). Nevertheless, this court concluded that the physical presence of vinyl chloride in the air, even if undetectable, constitutes a physical injury to the property for purposes of common law property damage claims.

C. The Appropriate Measure of Damages
Third, the court concluded that in the context of the present case, diminution in value was an appropriate measure of damages. The categorization of harm as “permanent” or “temporary” is not always dispositive. Rather than a compelling legal analysis to respond to defendant's strong argument on this point, the court resorted largely to the the generic policy observation that courts must be mindful of the fact that rules governing the proper measure of damages in a particular case are guides only and should not be applied in an arbitrary, formulaic, or inflexible manner. 
 

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On August 13th, the JPML created MDL 1967, IN RE: BISPHENOL-A (BPA) POLYCARBONATE
PLASTIC PRODUCTS LIABILITY LITIGATION.

The panel's order found that these actions share factual questions arising out of allegations that various defendants manufactured, sold or distributed polycarbonate plastic bottle products containing Bisphenol-A without disclosing its possible harmful effects. The cases were assigned to Judge Ortrie Smith of the Western District of Missouri.

At the time of the motion to create the MDL, this litigation consisted of fourteen actions pending in eight districts as follows: four actions in the Central District of California; two actions each in the Eastern District of California, the Western District of Missouri, and the Western District of
Washington; and one action each in the Eastern District of Arkansas, the District of Connecticut, the Northern District of Illinois, and the District of Kansas.

While the motion was pending, the Panel was notified that nine additional related actions have been filed: three actions in the Central District of California, and one action each in the Eastern District of Arkansas, the Northern District of Illinois, the District of Kansas, the Western District of Missouri, the Southern District of Ohio, and the Western District of Washington. These actions will be treated as potential tag-along actions.
 

MassTortDefense has posted on BPA and here.  BPA received considerable recent attention due to widespread human exposures and concern for possible reproductive and developmental effects reported in laboratory animal studies. A recent draft report by the Center for the Evaluation of Risks to Human Reproduction (CERHR) of the National Toxicology Program (NTP) examined the Food and Drug Administration finding that bisphenol-A is safe when used to line infant formula cans. The CERHR/NTP draft report expressed "some concern" based on animal studies that the chemical might affect the neurological systems and behavior of fetuses, infants, and children.

The NTP Brief on Bisphenol A is not a quantitative risk assessment, nor is it intended to supersede risk assessments conducted by regulatory agencies. The NTP Brief on Bisphenol A does not present a comprehensive review of the health-related literature; it does not include a comprehensive analysis of the issues related to this chemical. The NTP report relies heavily on animal testing, rather than human epidemiology. Regarding the neural and behavioral effects reported in some studies of rats and mice at relatively low BPA doses, the Panel authoring the report also acknowledges that it is not even clear whether these effects should be construed as an adverse toxicological response. The draft report does not conclude that BPA is dangerous. It notes that further research is needed – that’s the right approach to new data or concerns about a product that has been in use for decades. And the key reported low-dose effects are not replicated or corroborated.

The European Food Safety Authority recently concluded a report with a key conclusion that after exposure, the human body rapidly metabolizes and eliminates BPA. This represents an important metabolic difference compared with rats, and suggests certain animal models are not all that useful. That is, people metabolize and excrete BPA far more quickly than rodents. This evidence further limits the relevance of low-dose effects of BPA reported in some rodent studies used for human risk assessment.

 

 

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The FDA will hold a public meeting on September 8, 2008, to gather information that will assist the agency in further implementing the recommendations of the Nanotechnology Task Force Report relating to the development of agency guidance documents concerning nanotechnology. The primary purpose of the meeting is to determine what factors the agency should consider in providing guidance on:

1) The information and data that may be needed to demonstrate the safety and effectiveness of FDA-regulated products containing nanoscale materials; and

2) The circumstances under which a product’s regulatory status might change due to the presence or use of nanoscale materials.

Nanotechnology allows scientists to work on the scale of molecules to create, explore, and manipulate materials measured in nanometers; billionths of a meter. MassTortDefense has posted on nano-issues here and here.

In July 2007, FDA issued a report analyzing scientific and regulatory considerations relating to the safety and effectiveness of FDA-regulated products containing nanoscale materials regulated by FDA, and making recommendations regarding these considerations. The Nanotechnology Task Force Report made recommendations which covered foods (including dietary supplements), food and color additives (including food contact substances), animal drugs and feeds, cosmetics, human drugs and biologics, and medical devices. Additionally, the Report summarized the state of the science for biological interactions with nanoscale materials.

In addition, FDA is working with the National Institutes of Health (particularly the NanoHealth Enterprise) to explore methods for receiving and sharing data relating to, for example, general product development, including research on failed product candidates, and biological interactions of certain characteristics of nanoscale materials.

The meeting will begin with a plenary session at which FDA will review the goals of the meeting and give a general overview of the analysis and findings of the Nanotechnology Task Force and agency activities since publication of the Report in July 2007. Following will be breakout sessions on medical devices, including diagnostics; prescription drugs, including
biological drugs, animal drugs and OTC drugs, including sunscreens; food and color additives, including food contact substances; dietary supplements; and cosmetics.
 

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The Seventh Circuit Court of Appeals has affirmed a trial court’s ruling that a case involving plaintiffs alleging damages from chemicals escaping from a wood-processing facility is a “mass action” that belongs in federal court. See Bullard, et al. v. Burlington Northern Sante Fe Railway, et al., 2008 WL 2941359 (7th Cir. 2008).

A state court complaint by 144 plaintiffs sought damages from four corporations that had designed, manufactured, transported, or used chemicals that allegedly escaped from a Texas wood-processing plant and purportedly injured people living nearby. Among the plaintiffs’ claims are negligence, trespass, willful and wanton conduct, and fraudulent concealment, asserting that chemicals associated with creosote used to preserve wood were released into the environment through soil, ground water, and/or air mechanisms.

Defendants removed the suit, relying on the Class Action Fairness Act of 2005. CAFA expanded federal jurisdiction over various types of class actions. CAFA’s expanded jurisdiction was not limited to pure class actions, however. It also reaches a category of cases – “mass actions” – in which monetary claims of 100 or more persons are proposed to be tried jointly on the grounds that the plaintiffs’ claims allegedly involve common questions of law or fact. See 28 U.S.C. ¶1332(d)(11)(B)(i).

Plaintiffs moved to remand. They denied that the suit was a “mass action,” noting their complaint never proposed a trial. Thus, according to plaintiffs, defendants may remove a “mass action” only when a final pretrial order or equivalent document identifies the number of parties to the trial, which is to be “joint.” The district judge denied the motion for remand, and plaintiffs obtained interlocutory review “because the legal issue is novel.”

On appeal, plaintiffs argued they are entitled to litigate in state court because the Class Action Fairness Act has a loophole. Section 1332(d)(11)(B)(i) refers to “claims of 100 or more persons ... proposed to be tried jointly.” Complaints do not propose trials, plaintiffs insisted; they'd be happy to win by summary judgment or get a settlement. The case may never get to a trial. Cross that bridge when you come to it.

The Court rejected this reading. Plaintiffs' lawyers who want to avoid federal court, the Court said, have simply designed a class-action substitute. Their complaint alleges that several questions of law and fact are common to all 144 plaintiffs; it provides no more information about each individual plaintiff than an avowed class complaint would do. No one supposes that all 144 plaintiffs will be active; a few of them will take the lead, just as in a class action, and as a practical matter counsel will dominate, just as in a class action.

If the plaintiffs’ proposed strict reading were right, then, actually, §1332(d)(11) would be defunct, because it defines a class action to include a mass action. Taken to its logical end, in plaintiffs' view, no “mass action” could ever be a “class action”, for a suit cannot be officially identified as a “mass action” until the trial is finalized, not on the date of filing which, plaintiffs say, is the operative date. But “courts do not read statutes to make entire subsections vanish into the night,” said the Court.

A second reading would be to reject the date of filing as the only operative date and find that a case could become a “mass action” at any time. That could be long after filing, once plaintiffs are formally and explicitly proposed to be tried jointly. The prospect of this situation is why §1332(d)(11) allows the definition to be applied after the suits' filing date. But nothing in the statute says that the eve of trial is the only time when a “mass action” can be detected.

When plaintiffs take advantage of procedural rules that permit the joinder of multiple plaintiffs in a single suit where the claims arise out of “the same transaction or series of transactions” and “common questions of law or fact” are allegedly present, that's “exactly when a single trial is appropriate.” It does not matter whether a trial covering 100 or more plaintiffs actually ensues; the statutory question is whether one has been “proposed.” This complaint, which describes circumstances common to all plaintiffs, proposes one proceeding and thus, for statutory purposes, sufficiently alleges one trial.

And the Seventh Circuit went on to anticipate and reject plaintiffs' next likely reaction: A proposal to hold multiple trials in a single suit, or just one trial with 10 plaintiffs and the use of preclusion to cover everyone else, does not take the suit outside the language applying to any “civil action ... in which monetary relief claims of 100 or more persons are proposed to be tried jointly.” The question is not whether 100 or more plaintiffs answer a roll call in court, but whether the “claims” advanced by 100 or more persons are proposed to be tried jointly. A trial of 10 exemplary plaintiffs, followed by application of issue or claim preclusion to 134 more plaintiffs without another trial, is one in which the claims of 100 or more persons are being tried jointly, and this would bring the suit within federal jurisdiction.

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A Washington, DC think tank last week released a new report with suggestions on how the next administration should approach regulation of nano-technology in products.  The Project on Emerging Technologies is based at the Woodrow Wilson Center in Washington. The Project was established in 2005 as a partnership between the Woodrow Wilson International Center for Scholars and the Pew Charitable Trusts. The Project is dedicated to helping ensure that as nanotechnologies advance, possible risks are minimized, public and consumer engagement remains strong, and the potential benefits of these new technologies are realized.

Nanotechnologies are hailed by many as the next industrial revolution. They promise to change everything from the cars we drive to the clothes we wear, from the medical treatments our doctors can offer to our energy sources and workplaces. Although focused on very small particles, nanotechnologies offer large potential benefits. From new cancer therapies to pollution-eating compounds, from more durable consumer products to detectors for bio-hazards like anthrax, from novel foods to more efficient solar cells, nanotechnologies are changing the way people think about the future.

The Project on Emerging Nanotechnologies collaborates with researchers, government, industry, NGOs, policymakers, and others to look long term, to identify gaps in knowledge and regulatory processes, and to develop strategies for closing them. The Project's stated mission is to try to provide independent knowledge and analysis that can inform critical decisions affecting the development and commercialization of nanotechnologies.

A source of uncertainty for nanotechnology is regulation. The Project released a 28-page regulatory agenda for the next administration, noting that whichever candidate wins is going to have to deal with this issue, probably sooner rather than later. The next president has the opportunity to ensure that nanotechnology’s benefits will be maximized and its risks identified and mitigated, says the group. 

The report, Nanotechnology Oversight: An Agenda for the Next Administration, calls for the White House and federal agency policymakers to maximize the use of existing laws to improve nanotechnology oversight. Such measures include defining nanomaterials as “new” substances under federal toxics and food laws, thereby enabling the Environmental Protection Agency (EPA) and the Food and Drug Administration (FDA) to consider the novel qualities and effects of nanomaterials. The group addresses whether the Federal Food, Drug and Cosmetic Act, the Toxic Substances Control Act and the Consumer Product Safety Act need to be amended to cover nanotechnology.

The Project notes that more nanotech products are hitting the market. From March, 2006 to February, 2007, the number of manufactured goods using nanotech tripled to 600.  For fiscal 2009, the federal government has devoted $1.5 billion to nanotech, a sum split up between various agencies. Under the Bush administration, EPA has a Nanoscale Materials Stewardship Program, which is endorsed by the Synthetic Organic Chemical Manufacturers Association, the American Chemistry Council and the NanoBusiness Alliance. Some state governments, however, are pushing forward with their own rules on nanotech.

Coincidentally, consumer advocates said this week that food produced by using nanotechnology is quietly coming onto the market, and they want U.S. authorities to force manufacturers to identify them. New consumer products created through nanotechnology are coming on the market at the rate of 3 to 4 per week, according to The Project on Emerging Nanotechnologies.

MassTortDefense has posted on nanotechnology here and here.

 

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Recently, MassTortDefense posted about a proposed class action alleging lead in lipstick. See Stella v. LVMH Perfumes and Cosmetics USA Inc., No. 1:07-cv-06509, 2008 WL 2669662 (N.D. Ill. 7/8/08). The Northern District of Illinois denied the motion to dismiss consumer fraud claims. Now, a federal judge has thrown out a purported class action against L’Oreal USA Inc. and Procter & Gamble Distributing LLC that accused the companies of selling Cover Girl and Maybelline lipsticks containing lead. Koronthaly v. L’Oreal USA, Inc., et al., No. 07-5588 (D.N.J. July 29, 2008), opinion found here.

The plaintiff brought various claims, including unjust enrichment, breach of implied warranty and violations of the New Jersey Consumer Fraud Act. The plaintiff asked the court to enjoin the companies from carrying the lipsticks at issue and requested compensatory damages to recover the money she allegedly spent on the products. She also asked for damages to cover the costs of medical monitoring to detect lead poisoning. Plaintiff contended she would not have bought the lipsticks if the defendants had revealed that they contained the lead.

In contrast to the ruling in Illinois, the New Jersey District Court found the plaintiff lacked standing to sue since she had alleged no injury, harm or ascertainable loss from having purchased the lipstick. Plaintiff's allegations of a merely potential future injury were too remote and abstract to qualify as a concrete and particularized injury. Plaintiff had not alleged any present injury. Plaintiff's mere demand for damages did not establish injury-in-fact either. Plaintiff bought lipstick and used the lipstick, only complaining that the lipstick's alleged levels of lead were unsatisfactory to her. The FDA does not provide limitations on lead levels in lipstick. The FDA does not otherwise regulate lipstick. The plaintiff's analogy to lead in candy was insufficient. Plaintiff cannot seek a remedy for a harm that she has not actually or allegedly suffered.

The plaintiff's allegation of economic injury in a products liability action is insufficient to establish an injury-in-fact. The plaintiff had suffered no ill effects from use of the product, and had not alleged that any future harm was expected. The so-called benefit of the bargain injury could not sustain a claim under these circumstances.

What is interesting is that the court's analysis focused not so much on the elements of the state statue, but the requirement of standing under Article III. The triad of injury in fact, causation, and redressability comprises the core of Article III's case or controversy requirement. Plaintiff's alleged injury was too conjectural and hypothetical to satisfy the injury in fact requirement. Plaintiff thus lacked standing to bring her claim. And standing cannot be "acquired through the back door of a class action."

 

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The California Supreme Court has agreed to hear a public nuisance case involving lead paint manufacturers that raises the important issue whether public entities can hire outside attorneys on a contingency fee basis in these kinds of cases. County of Santa Clara v. Superior Court (Atlantic Richfield), No. S163681 (Cal. S.Ct.).

In granting review last week, the Court stated: “This case presents the following issue: May a public entity retain private counsel to prosecute a public nuisance abatement action under a contingent fee agreement?”

Ten or so California cities and counties are plaintiffs in the case which accused several former lead paint manufacturers of fraud, strict liability, negligence, unfair business practices, and public nuisance. Eventually, the plaintiffs agreed to move forward with only the public nuisance question. In February, 2007, the defendants filed a motion to bar payment of contingency fees to private attorneys hired by the government plaintiffs. Under an agreement reached by the cities and counties, private counsel apparently were to receive only a small fee upfront, but then 17% of any net recovery.

The California superior court barred the public entities from compensating their private counsel through contingency fees. In April, 2008, the Sixth Appellate Court of Appeal overturned that decision, saying private counsel would only play a limited role in this particular litigation – so the arrangement was acceptable. The court of appeals' opinion tried to draw a distinction between situations where private counsel are performing tasks on behalf of and in the name of the government in a public nuisance abatement action – where private counsel must be absolutely neutral and cannot be compensated by a contingent fee arrangement – and the situation where private counsel are “merely assisting” government attorneys in the litigation of a public nuisance abatement action and are explicitly serving in a subordinate role. In the latter case, private counsel are not themselves acting in the name of the government and have no role in the balancing of interests that triggers the absolute neutrality requirement, the court stated. The defendants filed a petition for review.

When an attorney wields the power of the state in court, there are ethical and prudential concerns. Not only is a government lawyer's neutrality essential to a fair outcome for the litigants in the case in which he or she is involved, it is essential to the proper function of the judicial process as a whole. Our system relies for its validity on the confidence of society; without a belief by the people that the system is just and impartial, the concept of the rule of law cannot survive. When a government attorney has a personal interest in the litigation, the neutrality so essential to the system is violated. For this reason prosecutors and other government attorneys can be disqualified for having an interest in the case extraneous to their official function.

The justification for the prohibition against contingent fees seen in criminal actions has been extended to certain civil cases. In People ex rel. Clancy v. Superior Court, 39 Cal.3d 740, 218 Cal.Rptr. 24 (Cal. 1985), the Court did not adopt a per se ban on such contingency fees, but did note that there is a class of civil actions that demands the representative of the government be absolutely neutral. This requirement would preclude the use in that class of cases of a contingent fee arrangement.

The abatement of a public nuisance involves a balancing of interests. On the one hand is the interest of the people in ridding their community of the alleged obnoxious or dangerous condition; on the other hand is the interest of the landowner in using/selling his property or products. Thus, as with an eminent domain action, the abatement of a public nuisance involves a delicate weighing of values. Any financial arrangement that would tempt the government attorney to tip the scale cannot be tolerated, said Clancy. It will be interesting to see if the "merely assisting" distinction succeeds.

That type of distinction was adopted by the Rhode Island Supreme Court in State of Rhode Island v. Lead Industries Association, Inc., No. 2004-63-M.P. (R.I. July 1, 2008), found here. In that case, the fee agreement provided that, in return for their legal representation on behalf of the state in the lead paint litigation, counsel would be entitled to a fee reflecting 16 2/3 percent of any monies recovered. Although the Court ruled for the defendants on the merits, it addressed the fee issue as one of extreme public importance, and as capable of repetition but evading review. The Court noted that the propriety vel non of contingent fee agreements in the public sector is a much controverted and still developing area of the law. It concluded that the Attorney General is not precluded from engaging private counsel pursuant to a contingent fee agreement in order to assist in certain civil litigation, so long as the Office of Attorney General retains absolute and total control over all critical decision-making in any case in which such agreements have been entered into. Accordingly, in order to ensure that a contingent fee agreement is not adverse to the standards that an attorney representing the government must meet, it is vital that the Attorney General have absolute control over the course of any litigation originating in that office. The Attorney General’s discretionary decision-making must not be delegated to the control of outside counsel; rather, it is the outside counsel who must serve in a subordinate role.

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The European Food Safety Authority’s AFC Panel has issued a further scientific opinion report on the chemical bisphenol-A (BPA). MassTortDefense has posted on BPA here and here. The goal of the assessment was to focus on the chemicals’ elimination from the body and how that might relate to the risk assessment of BPA in humans. The work took into account the most recent data since the EFSA’s 2006 opinion report, which concluded that exposure to BPA is well below the Tolerable Daily Intake (TDI).  A TDI is a regulatory standard for dietary exposure calculated to ensure that no adverse effects occur.


About EFSA
The European Food Safety Authority is an independent European agency funded by the EU. The EFSA is governed by an independent Management Board whose members are appointed to act in the public interest and do not represent any government, industry, or private sector. EFSA’s role is to assess and communicate on all risks associated with the food chain. Since EFSA’s advice serves to inform the policies and decisions of risk managers, a large part of EFSA’s work is undertaken in response to specific requests for scientific advice from the European Commission, the European Parliament, and EU Member States. The AFC Panel focus is on food additives, flavorings, processing aids and materials in contact with food.

Conclusions

The key conclusion of the Panel on BPA is that after exposure, the human body rapidly metabolizes and eliminates the substance. This represents an important metabolic difference compared with rats, and suggests certain animal models are not all that useful. That is, people metabolize and excrete BPA far more quickly than rodents. This evidence further limits the relevance of low-dose effects of BPA reported in some rodent studies used for human risk assessment.

The Panel further concluded that the exposure of a human in utero to BPA would be negligible because the mother rapidly metabolizes and eliminates BPA from her body. The scientists also concluded that newborns are similarly able to metabolize and eliminate BPA at doses below 1 milligram per kilogram of body weight per day. This implies that newborns could effectively clear BPA at levels far in excess of the TDI of 0.05 mg/kg bw set by the Panel, and therefore its 2006 risk assessment remains valid. The TDI provides a sufficient margin of safety for the protection of the consumer, including fetuses and newborns, EFSA said.

EFSA took note of the U.S. National Toxicology Program’s draft brief on BPA, and of the Canadian government’s recent Draft Screening Assessment on BPA, which took into account findings from low-dose animal studies, notably with respect to neuro-developmental toxicity. It pointed out that these studies were limited in rigor, consistency and biological plausibility.

The new European report is consistent with the statements of the FDA that a large body of evidence indicates that currently marketed products containing BPA, such as baby bottles and food containers, are safe and that exposure levels to BPA from these products are well below those that may cause health effects.

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A federal court earlier this month permitted a proposed class action to move forward with its central allegation that Christian Dior lipstick contains excessive levels of lead. See Stella v. LVMH Perfumes and Cosmetics USA Inc., No. 1:07-cv-06509, 2008 WL 2669662 (N.D. Ill. 7/8/08).

Named plaintiff Pamela Stella alleges that she purchased Christian Dior "Addict Positive Red" lipstick, manufactured by LVMH Perfumes and Cosmetics USA Inc., at a Nordstrom department store in June, 2007. The so-called “Campaign for Safe Cosmetics” group issued a report in October, 2007 claiming that tests showed a lead level in LVMH lipsticks which slightly exceeds the regulatory limit established by the Food and Drug Administration for lead content in certain products like candy.  In reality, the average amount of lead a woman would be exposed to when using cosmetics is 1,000 times less than the amount she would get from eating, breathing and drinking water that meets Environmental Protection Agency (EPA) drinking water standards, according to the Cosmetics, Toiletry and Fragrance Association (CTFA).

Plaintiff then sued LVMH in November, 2007 on behalf of a proposed nationwide class of lipstick purchasers. She alleged that the company violated the Illinois deceptive business practices statute and breached an implied warranty of merchantability. She also brought claims for strict liability, negligence per se, unjust enrichment, and injunctive relief.

Judge Elaine E. Bucklo of the U.S. District Court for the Northern District of Illinois denied defendant’s motion to dismiss. She determined that Stella sufficiently alleged a claim under the deceptive trade practices law, including its requirement of actual damages. Stella sought to recover actual damages, the court said, "in the form of pecuniary damages (the cost of the lipstick).” The court also noted that plaintiff had alleged that her reliance on defendant's omission caused her to buy the lipstick and become exposed to lead. “This sufficiently alleges proximate cause.”

The court also agreed with plaintiff that Illinois law would permit medical monitoring as a remedy. The Illinois Supreme Court has not ruled on the question. But in Carey v. Kerr-McGee Chemical Corp., 999 F. Supp. 1109, 1118-19 (N.D. Ill. 1998), the district court had predicted that medical monitoring would be recognized as cognizable under Illinois law.

MassTortDefense has posted on medical monitoring before, here and here. The clear trend has been away from recognizing these claims, see Lowe v. Philip Morris USA, Inc., 344 Or. 403, 183 P.3d 181 (2008), or to narrow their scope. See Sinclair v. Merck & Co., 195 N.J. 51, 948 A.2d 587 (2008).

Where recognized, medical monitoring plaintiffs typically must prove:
1. exposure greater than normal background levels;
2. to a proven hazardous substance;
3. caused by the defendant's negligence;
4. as a proximate result of the exposure, plaintiff has a significantly increased risk of contracting a serious latent disease;
5. a monitoring procedure exists that makes the early detection of the disease possible;
6. the prescribed monitoring regime is different from that normally recommended in the absence of the exposure; and
7. the prescribed monitoring regime is reasonably necessary according to contemporary scientific principles.

Medical monitoring is almost always seen as a potential class action claim, for several reasons:
• First, the individual damages associated with periodic testing of a so-far healthy plaintiff may not be all that financially attractive to plaintiff attorneys.
• Secondly, a number of the elements of the claim (or remedy) of medical monitoring seem, on the surface, amenable to “common” proof in the form of epidemiological evidence. For example, the increased risk that typically must be shown.

When the issue is ripe, it should be clear that such claims are not appropriate for class treatment, as numerous individual issues will arise, including choice of law, properly viewed, in a nationwide class.

Defendant LVMH's also challenged the implied warranty claims, based on the absence of contractual privity between plaintiff and LVMH. But the court narrowly construed the privity requirement to say that Illinois law requires contractual privity as a prerequisite for breach of implied warranty claims only for recovery of economic losses. Voelker v. Porsche Cars North Am., Inc., 353 F.3d 516, 527 (7th Cir.2003). The medical monitoring claim, as "a form of personal injury claim," brought plaintiff out from under this privity requirement, said the court.

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The Indiana Court of Appeals has ruled that the trial court correctly granted summary judgment to DaimlerChrysler Corporation in two separate toxic exposure cases involving visiting workers at the company's New Castle, Ind., facility. See Coomer v. DaimlerChrysler Corp., Ind. Ct. App., No. 33A01-0712-CV-582, 7/11/08); and Gregory v. DaimlerChrysler, Ind. Ct. App., No. 33A01-0712-CV-581, 7/11/08). In affirming the rulings of the Indiana Circuit Court, the Court of Appeals held that the expert in both cases, Dr. George Rogers, did not adequately specify the level, concentration, or duration of plaintiffs' alleged exposure to unspecified chemicals. Accordingly, the workers failed to present sufficient expert evidence to establish causation.

Plaintiffs Matthew Gregory and Darrin Coomer were employees of Smoot Construction, and alleged they were doing work at the DaimlerChrysler New Castle Machining and Forging Facility. Three months after starting work, Coomer experienced a seizure while playing video games at home. Coomer’s treating neurologist diagnosed him with juvenile myoclonic epilepsy (JME), the “most common genetic or inherited form of epilepsy . . . [which is] thought to be caused by an abnormal gene on the short arm of chromosome 6.”  About 7 months after he began working, plaintiff Gregory, who was twenty-seven years old, allegedly experienced his first seizure after returning home from work. An IME showed he suffered from idiopathic seizure disorder.

Gregory and Coomer, in two separately filed complaints against Daimler/Chrysler Corp., Methadone Corp., and NC-M Chassis Systems LLC, alleged that the seizures were caused by their exposure to allegedly contaminated soil, water, and toxins at the facility. Defendant moved for summary judgment on the issue of causation. In response, plaintiffs presented their own expert, a professor of pediatrics and pharmacology/toxicology, who concluded that Coomer and Gregory were "clearly'' exposed to a "complex mixture of potentially toxic materials.''  The expert opined that many of the materials identified on the site, including some solvents and metals, can cause seizures with excess exposure. “I think it is reasonable to conclude that [plaintiffs'] occupational exposure to this mix of toxic chemicals may have contributed to the onset" of their disorders.

The Court of Appeals noted that an expert’s opinion is insufficient to establish causation when it is based only upon a temporal relationship between an event and a subsequent medical condition. In particular, when an expert witness testifies in a chemical exposure case that the exposure has caused a particular condition because the plaintiff was exposed and later experienced symptoms, without having analyzed the level, concentration or duration of the exposure to the chemicals in question, and without sufficiently accounting for the possibility of alternative causes, the expert’s opinion is insufficient to establish causation. Dr. Rodgers did not identify which chemicals plaintiffs were allegedly exposed to. He did not specify the level, concentration, or duration of their alleged exposure to the unspecified chemicals. Instead, Dr. Rodgers made vague assertions regarding plaintiffs’ alleged exposure to a mixture of “potentially toxic materials.” MassTortDefense has posted about the importance of evidence of dose here.

In toxic tort cases in Indiana, one way an expert may approach the causation issue is by way of a “differential diagnosis,”  testing to rule out alternative causes of the plaintiff’s ailments. But the expert never addressed the independent medical examiner’s conclusion that Gregory had an idiopathic seizure disorder, and he also failed to address the possible impact of a skull fracture Gregory sustained in an accident as a child. The expert failed to respond to the fact that Coomer’s own physician concluded that Coomer’s seizures were the result of a genetic form of epilepsy.

In sum, because Dr. Rodgers did not identify specific chemicals, analyze the level, concentration, or duration of Coomer’s alleged exposure, or account for the possibility of alternative causes, his opinion was insufficient to establish causation.

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There has been significant discussion of preemption recently, particularly in the medical device and drug context. A recent decision under the Federal Railroad Safety Act offers some insight into potentially important aspects of the doctrine, and particularly when Congressional action may affect preemption.

In Lundeen v. Canadian Pac. Ry. Co., 2008 WL 2597958 (8th Cir. July 2, 2008), the Eighth Circuit confronted a situation in which a legislative amendment, which was retroactive to the date of the relevant incident, had the apparent effect of reinstating a suit which had been preempted.

In January, 2002, a freight train operated by Canadian Pacific Railway Co. derailed in North Dakota, releasing a cloud of anhydrous ammonia. Nearby residents sued in state court, alleging respiratory disease and eye damage. Defendants removed based on federal question jurisdiction, but plaintiffs amended their complaint to delete reference to federal law. The district court then ruled that the cases should be remanded to Minnesota state court. Canadian Pacific appealed the ruling, and the Eighth Circuit found that the claims were preempted under the Federal Railroad Safety Act. The cases were remanded to the district court, which dismissed on the merits.

Plaintiffs appealed, and while the appeal was pending, the Act was amended, retroactive to the date of the train derailment. The amendment stated that “nothing in this section shall be construed to preempt an action under State law seeking damages for personal injury, death, or property damage alleging that a party …has failed to comply with the Federal standard of care established by a regulation or order issued by the Secretary of Transportation (with respect to railroad safety matters), or … has failed to comply with a State law, regulation, or order that is not incompatible with [federal law].” This “clarifying” amendment reflected Congress's disagreement with the manner in which the courts, including the Eighth Circuit, had interpreted the Act to preempt state law causes of action whenever a federal regulation covered the same subject matter as the allegations of negligence in a state court lawsuit.

Defendants argued that applying the amendment here: 1) would violate the U.S. Constitution's separation of powers doctrine; 2) violate due process; 3) violate equal protection; and 4) violate the ex post facto clause.

The appeals court rejected the railroad's separation of powers argument, citing Plaut v. Spendthrift Farm, 514 U.S. 211 (1995), for the notion that the doctrine is violated only when Congress tries to apply new law to cases which have already reached a final judgment. Here, the amendment became effective while these cases were on appeal and had not reached final judgments. The Supreme Court has reiterated that Congress possesses the power to amend existing law even if the amendment affects the outcome of pending cases.

The court also denied the due process challenge. The railroad had the burden of showing there is no rational basis for the law. See FCC v. Beach Communications, Inc., 508 U.S. 307 (1993). Indeed, the court noted it reviews legislation regulating economic and business affairs under a “highly deferential rational basis” standard of review. The sufficient rational basis for the amendment, said the court, was to give railroad accident victims the right to seek recovery in state courts when they allege railroads violate safety standards. Prior to the amendment, the relevant section had been interpreted in such a way that an injured person’s state law claims were preempted. It was “rational” for Congress to clarify this result was not an intended purpose of the Act.

No equal rights violation was recognized despite the amendment imposing different standards on railroads that caused harm before and after the effective date. Every retroactive statute, by necessity, imposes different standards on parties affected by the statute, and those differences are directly tied to the statute's effective date.

Finally, the court said, the amendment does not violate the Ex Post Facto clause, because there is no proof that Congress intended the amendment as a criminal penalty. The Ex Post Facto clause applies only to criminal penalties, and clear proof is needed to support the argument that a civil remedy is so “punitive” in purpose or effect as to be in essence a criminal penalty.

In an interesting dissent, Judge Beam disagreed with the majority view of retroactivity. Because the case had already been up on appeal on an issue of federal jurisdiction there was a final decision that could not be undone by legislation.

Of more interest to readers of MassTortDefense is his argument that the court should have followed Riegel v. Medtronic, Inc., 128 S.Ct. 999 (2008) and its discussion of the preemption precedent established in Cipollone v. Liggett Group, Inc., 505 U.S. 504 (1992); Medtronic, Inc. v. Lohr, 518 U.S. 470 (1996); and Bates v. Dow Agrosciences LLC, 544 U.S. 431 (2005).

“I concede that the MDA as discussed in Riegel deals with a product or service different from that of the FRSA. But, for preemption analysis, any differences are immaterial-the preemption language and the regulatory requirements are analogous. For federal preemption purposes, a medical device manufactured and marketed under a regime employing specific federal safety requirements is little different from a railroad service formulated and delivered under specific federal safety regulations. Thus, Riegel provides the precedent we must apply.”

And “Like the medical device in Riegel, the railroad service in Lundeen is entitled to be delivered free of state requirements that differ from the federal regime. And, when the amended statute is properly construed, the limited state cause of action authorized by FRSA II fits within that paradigm. So, with minor exceptions not applicable in Lundeen, all state railroad safety requirements that are in addition to or different from those established under FRSA II are preempted. Paraphrasing Justice Scalia's comment in Riegel, excluding North Dakota common law duties from the scope of the FRSA II preemption scheme would make little sense.”

Thus, the dissent argued that Congress had authorized the creation of a state cause of action, but at the same time carefully protected the concept of federal uniformity established by the Act. This cause of action is limited to allegations regarding the failure of a defendant to comply with the federal standards of care established by regulation or order issued by the Secretary of Transportation, or the failure to comply with a plan, rule or standard created pursuant to regulation or order of the Secretary. This limited claim for damages preserves the federal uniformity demanded by the FRSA. Accordingly, any state law cause of action permitting railroad liability based upon more expansive state-based requirements than those directly established by the Secretary's regulations, rules or orders, does not pass muster under the amended Act, said the dissent. 

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The MDL transferee court has denied the summary judgment motion of the manufacturer of an allegedly toxic ingredient in Stand 'n Seal grout sealer. In re Stand 'N Seal Products Liability Litigation, 2008 WL 2622793 (N.D.Ga.), No. 1:07-MDL-01804 (6/26/08). The motion focused on the apparent inability of 67 plaintiffs to demonstrate exposure to the product, which in turn meant they could not show causation. Proof of exposure is a recurring theme in toxic tort litigation, and MassTortDefense has blogged on it here.

Stand 'n Seal originally contained an ingredient called Zonyl, according to the court’s recitation. The manufacturers substituted one ingredient, Innovative Chemical Technologies, Inc.’s product, Flexipel S-22WS, for Zonyl in 2005; some users then complained of respiratory problems, leading to a recall. Numerous personal injury actions were consolidated in a multidistrict litigation overseen by Judge Thomas W. Thrash of the U.S. District Court for the Northern District of Georgia.

ICT’s motion sought to dismiss the group of 67 plaintiffs on the basis that they could not prove their exposure to the Stand 'n Seal product with Flexipel. Generally, plaintiffs must show that the product that allegedly caused their injuries was, in fact, manufactured or supplied by the defendant in this case.

According to Judge Thrash, some of these plaintiffs lacked a can identification number – typical product identification evidence – because they threw away their cans of Stand 'n Seal. Others, he said, retain a can that contains Zonyl, but claim they used more than one can of Stand 'n Seal. The court found that under applicable Georgia law such plaintiffs could use circumstantial evidence to meet their burden of proving exposure to the ingredient. In an interesting turn of phrase, the court stated that ICT had not presented clear and positive evidence that all of the Plaintiffs used cans containing only Zonyl. Under the summary judgment standard, defendant as the moving party did not have that burden. Rather, defendant needed to show there was genuine issue of fact, and plaintiffs’ lack of relevant evidence was certainly part of that showing.

The court concluded that the plaintiffs subject to this motion should be allowed to present individualized circumstantial evidence that they were exposed to cans containing Flexipel. “Such evidence could include testimony concerning the smell of the product. It could include testimony as to the date and place of the purchase of the product.” In a typical case, the plaintiff would have had to make such a showing to defeat summary judgment. But here, in the MDL. the timing of summary judgment motions can be atypical. Accordingly, the court held that the presentation of such individualized evidence by the plaintiffs could occur following remand to the transferor courts or before bellwether trials in this MDL court.

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Typically, MassTortDefense will post about significant opinions issued on product liability issues. A recent decision, without opinion, by the California Supreme Court is worth a mention. Just recently, the court declined to review the intermediate appellate court’s affirmance of a $3.9 million asbestos verdict. It thus left standing the appellate court’s view on the important issue whether so-called de minimis exposures are sufficient to satisfy the substantial factor test. Norris v. Crane Co., 2008 WL 638361 (Cal.App. 2d Dist. 2008). The California rule raises significant issues for asbestos and potentially other toxic tort defendants, and stands in contrast to the better view in many other jurisdictions.

Background
The plaintiff, former Naval worker Joseph Norris, had been awarded $3.9 million by the jury, 50% liability assigned to defendant Crane Co. The company appealed the verdict, arguing that plaintiff failed to present substantial evidence linking asbestos in the Crane valves to the decedent's mesothelioma. The Second District Court of Appeal disagreed, and affirmed the verdict. On June 25th, the state Supreme Court denied the petition for review.

The court of appeals found sufficient the evidence that the U.S. Navy purchased several types of Crane Co. valves, and that the defendant was aware that parts of these valves would have to be replaced at some point. Norris was allegedly "within a few feet" of other workers who were grinding Crane valves and replacing gaskets on the product. The jury could infer that this process released fibers that contributed to the dust in the air plaintiff breathed as he waited. Also, Norris slept in quarters with two small Crane valves, and when the valves were overhauled, dust was released and was not cleaned up.

Expert testimony was offered to the effect that every exposure to asbestos fibers increased the total dose in his lung that led to the development of his disease. Each dose added more fibers that could stay in the lung. There was substantial evidence plaintiff’s “exposure to asbestos from materials in Crane valves increased his risk of developing mesothelioma and, therefore, was a substantial factor in causing his injury." Thus, the plaintiff successfully proved a causal link between the Crane Co. valves and Norris' mesothelioma, said the court.

 
What’s Wrong With This Picture?
Tort law requires that the allegedly defective product have caused the injury. In the toxic substance context, plaintiff must have been exposed to defendant’s product, and exposed to a sufficient dose that is capable of causing the disease, and actually did cause the disease in plaintiff. Dose refers to the amount of chemical that enters the body, and is arguably the single most important factor to consider in evaluating whether an alleged exposure caused a specific adverse effect. Indeed, a founding principle of toxicology is that the “dose makes the poison.”

The problem with the California opinion is that the plaintiff had improperly been allowed to submit evidence of "any exposure," which rule would allow exposed persons to sue thousands of new defendants whose supposed “contribution” to the disease is trivial at best, and certainly far below the type of doses actually known to cause or increase the risk of disease in any meaningful way.

It is common for plaintiffs to submit expert affidavits attesting that any exposure to asbestos, no matter how minimal, is a substantial contributing factor in asbestos disease. Such generalized opinions ought not suffice to create a jury question in a case where exposure to the defendant's product is de minimis, particularly in the absence of evidence excluding other possible sources of exposure (or in the face of evidence of substantial exposure from other sources). See generally Borg-Warner Corp. v. Flores, 232 S.W.3d 765 (Tex. 2007)(rejecting view that if plaintiff can present any evidence that a company's asbestos-containing product was at the workplace while plaintiff was at the workplace, jury question has been established as to whether that product proximately caused plaintiff's disease).

A far different take on this issue is seen in other jurisdictions. The Pennsylvania Supreme Court, for example, reached conclusions contrary to the California appellate court's ruling in Gregg v. V.J. Auto Parts Inc., 943 A.2d 216, 226-227 (2007). That court concluded that it is not a viable solution to indulge in a fiction that each and every exposure to asbestos, no matter how minimal in relation to other exposures, raises a fact issue concerning substantial-factor causation. The result of that approach would be to subject defendants to full joint-and-several liability for injuries and fatalities in the absence of any reasonably developed scientific reasoning that would support the conclusion that the product sold by the defendant was a substantial factor in causing the harm.

Other courts will thus apply the frequency, regularity, proximity factors in asbestos litigation, Lohrmann v. Pittsburgh Corning Corp., 782 F.2d 1156 (4th Cir.1986), if not as a rigid standard with an absolute threshold necessary to support liability, then at least as an aid in distinguishing cases in which the plaintiff can adduce evidence that there is a sufficiently significant likelihood that the defendant's product caused his harm, from those in which such likelihood is absent on account of only casual or minimal exposure to the defendant's product. The California court missed this opportunity.

(Any readers interested in a copy of the Amicus brief on this issue in the court of appeals can email me and I will send you a copy.)

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The MDL court in the In re Welding Fume Products Liability Litigation, MDL-1535 (N.D. Ohio) recently issued an interesting Order about mediation. Not ordering mediation. Instead, it came to the Court’s attention that various plaintiff counsel have stated publicly that the Court has ordered the parties to engage in mediation. This statement, in turn, has led to various conjectures and to requests that assorted deadlines be postponed pending mediation. The Court issued an “Order to end inappropriate speculation.” Although the MDL Court did, sua sponte, raise the concept of mediation, the Court has not ordered any mediation in this case. In particular, the Court has scheduled the next MDL bellwether case – Byers v. Lincoln Electric Company – for trial in November of 2008. The Court issued the Order to make “clear here that it expects the parties will pursue all deadlines in their welding fumes litigation accordingly.” Motions in limine are due 9/15. Dispositive motions are due 9/8.

In this mass tort, plaintiffs have moved to dismiss more than 4,000 cases in the MDL. The total number of cases pending against the welding defendants has dropped by over two-thirds. Plaintiffs have been forced to dismiss five trial-ready cases, including three slated for early trials in the MDL. Although plaintiffs secured a significant verdict last December in the Tamraz case, it was the first plaintiff victory in several years, and juries have found for defendants in 20 of the last 23 plaintiffs’ cases tried in this litigation, including consolidated cases that are heavily weighted toward plaintiffs and cases in jurisdictions that are considered plaintiff-friendly.

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The Centers for Disease Control and Prevention has released the results of a study which it commissioned concerning formaldehyde levels in mobile homes provided to residents of the Gulf Coast affected by Hurricane Katrina in 2005. The trailers, which were provided by the Federal Emergency Management Agency to survivors of the hurricane, have been the targets of a series of lawsuits around the United States. See In Re FEMA Trailer Formaldehyde Products Liability Litigation, MDL No. 1873 (E.D. La.). CDC has been working with FEMA and other agencies to investigate possible levels of formaldehyde in the trailers and mobile homes.

RESULTS

The study was conducted by the Lawrence Berkeley National Laboratory in California, and concluded that the individual component parts of the trailers contained formaldehyde below federally regulated levels, but when combined, the formaldehyde level can rise higher than regulatory limits/industry standards. That is, in the study of four vacant trailers, CDC's contractor found that the amount of formaldehyde given off by each trailer part was not higher than the limit set by the U.S. Department of Housing and Urban Development. The higher overall total “may be because” the trailers use more composite wood products, such as thin particleboard, than site-built or manufactured houses, have more composite wood products in a smaller space than site-built or manufactured homes, and/or let in less fresh air than does a site-built or manufactured house. The study found that the trailers had more wood paneling in a more constricted space than other homes. “These findings indicate that elevated formaldehyde levels are most likely due to a construction/design issue in the trailers,” said the report.

Berkeley scientists focused on commercially available trailers and models built custom for FEMA by four makers. Scientists tested formaldehyde levels inside trailers for one hour in the morning and one hour in the afternoon. LBNL then tested individual pieces of the trailer at the Berkeley, Calif. lab. for emissions from specific parts of each trailer, such as walls, floors, ceilings, tables and cabinets. Some 45 small material samples of wood products from the 4 units were collected to measure their material-specific emission rates for 33 compounds. Only three of the compounds tested for were detected, and formaldehyde was the only one considered to be of possible human health significance. An important finding was that only one material of the 45 tested exhibited formaldehyde emissions in excess of the HUD standard.

CAREFUL INTERPRETATION NEEDED

CDC said the study helped identify the sources of formaldehyde and other volatile organic compounds that may make the largest contributions to the indoor air quality. It also indicates that the amount of ventilation affects the concentrations found in the air. However, MassTortDefense notes that the study analyzed only 4 vacant, never-used trailers, which were provided by FEMA, including two trailers that were specifically designed to be used as temporary emergency housing and thus not commercially available. CDC admits that this study, because it only examined four travel trailers, did not provide results that could be applied to all FEMA-supplied travel trailers or to other types of temporary housing, such as park models or mobile homes. That will likely not stop plaintiffs from trying to misuse it in litigation.  

Such studies can present significant challenges in litigation because they may have the aura of credibility associated not only with an "independent" testing facility but also the government agency which commissioned the study. Generally speaking, parties facing such studies will want to carefully analyze the study, with expert assistance, to detect any issues with methodology, data, conclusions or application to the facts in the case at issue. For example, this study did not compare trailers purchased "off the lot" by FEMA to those designed specifically for FEMA use. Such flaws can point the way to investigations defendants may undertake to properly and more fully address issues in the litigation.  Similarly, CDC admits that "the results of the LBNL investigation described in this report are not definitive."   It would be arguably improper for plaintiffs' experts to place more reliance on the results than the agency that commissioned the study. Finally, defendants facing such studies will want to carefully explore potential sources of bias or interest on the part of the agency or testing facility.

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In a unanimous decision, the Rhode Island Supreme Court has rejected the state's public nuisance suit against three former lead pigment makers. See Rhode Island v. Lead Industries Association, No. 2006-158-Appeal; No. 2007-121-Appeal (July 1, 2008).

The decision represents the latest round in the ongoing battle surrounding the misapplication by plaintiffs of the traditional tort of nuisance. The Rhode Island action was the first suit filed by a state against the lead paint industry. Since then, appeals courts in New Jersey, Missouri, and Illinois all have rejected public nuisance claims against former lead pigment manufacturers.

The state sued a number of paint makers and the trade group Lead Industries Association Inc., in 1999. The state alleged that the manufacturers or their predecessors-in-interest had
manufactured, promoted, distributed, and sold lead pigment for use in residential paint, despite
that they allegedly knew or should have known, since the early 1900s, that lead is hazardous to human health. The state also contended that the LIA was, in essence, a co-conspirator of one or more of the manufacturers from at least 1928 to the present. The state asserted that defendants failed to warn Rhode Islanders of the hazardous nature of lead and failed to adequately test lead pigment. In addition, the state maintained that defendants concealed these hazards from the public or misrepresented that they were safe. 

Paint manufacturers voluntarily stopped selling lead-based house paint in the 1990’s after evidence began to suggest that it posed serious health risks. Particular to the nuisance claim,  defendants assert that they did not control the lead pigment at the time it caused harm to Rhode Island children and that, therefore, they cannot be held liable for public nuisance. The defendants also argue that there was no interference with a public right, as that term has been recognized under public nuisance law.

The Rhode Island trial judge declined to dismiss the state's public nuisance claims. Defendants had asserted that the state had not alleged and could not show that defendants' conduct interfered with a public right, or that defendants were in control of lead pigment at the time it allegedly caused harm to children in Rhode Island. The first trial in the case ended in a mistrial in 2002. Following a 15-week trial, the longest civil jury trial in the state’s history, the jury in state Superior Court in 2006 found Sherwin-Williams Co., NL Industries Inc., and Millennium Holdings LLC responsible for the public nuisance posed by lead in buildings. The jury found that the defendants should be ordered to abate the nuisance, the first time in the United States that a trial resulted in a verdict that imposed liability on lead pigment manufacturers for creating a public nuisance. The state offered a $2.4 billion abatement plan in September 2007.

On appeal, defendants argued that argued that the trial justice erred by: (1) misapplying the law of public nuisance; (2) finding a causal connection between defendants’ actions and lead poisoning in Rhode Island; and (3) failing to hold that the action was barred by the constitutional provision concerning separation of powers. In an 81-page ruling, the state's top court reversed the judgment of abatement.

The Restatement (Second) defines public nuisance, in relevant part, as follows:
1) A public nuisance is an unreasonable interference with a right common to the general public.   2) Circumstances that may sustain a holding that an interference with a public right is unreasonable include the following: “(a) Whether the conduct involves a significant interference with the public health, the public safety, the public peace, the public comfort or the public convenience….” 4 Restatement (Second) Torts § 821B at 87.

The Rhode Island Court accordingly recognized three principal elements that are essential to establish public nuisance: (1) an unreasonable interference; (2) with a right common to the general public; (3) by a person or people with control over the instrumentality alleged to have created the nuisance when the damage occurred. After establishing the presence of the three elements of public nuisance, one must then determine whether the defendant caused the public nuisance."  Causation is a basic requirement in any public nuisance action." In addition to proving that a defendant is the cause-in-fact of an injury, a plaintiff must demonstrate proximate causation.

The Rhode Island attorney general failed to prove that the companies interfered with a public right or had control of the lead paint when it harmed children in the state. Control at the time the damage occurs is critical in public nuisance cases, especially because the principal remedy for the harm caused by the nuisance is abatement. The responsibility for the harm that lead paint caused lies with property owners, as the state Legislature has already established. “The General Assembly has recognized defendants' lack of control and inability to abate the alleged nuisance because it has placed the burden on landlords and property owners to make their properties lead-safe.”

However grave the problem of lead poisoning is in Rhode Island, public nuisance law simply does not provide a remedy for this harm. The proper means of commencing a lawsuit against a manufacturer of lead pigments for the sale of an unsafe product is a products liability action. The law of public nuisance never before has been applied to products, however harmful. "Undoubtedly, public nuisance and products liability are two distinct causes of action, each with rational boundaries that are not intended to overlap." Public nuisance focuses on the abatement of annoying or bothersome activities. Products liability law, on the other hand, has its own well-defined structure, which is designed specifically to hold manufacturers liable for harmful products that the manufacturers have caused to enter the stream of commerce.

Courts presented with product-based public nuisance claims have expressed their concern over the ease with which a plaintiff could bring what properly would be characterized as a products liability suit under the guise of product-based public nuisance. Courts in other states consistently have rejected product-based public nuisance suits against lead pigment manufacturers, expressing a concern that allowing such a lawsuit would circumvent the basic requirements of products liability law. See American Cyanamid Co., 823 N.E.2d at 134; Benjamin Moore & Co., 226 S.W.3d at 116; In re Lead Paint Litigation, 924 A.2d at 503-05 (N.J.).

The battle now shifts to pending cases in Ohio and California.

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In another in a series of rulings on expert issues, the MDL court in the MTBE litigation has excluded parts of the proffered testimony of a plaintiffs' expert, while permitting others. Judge Shira Scheindlin of the U.S. District Court for the Southern District of New York issued an order permitting Dr. Myron Mehlman to testify that MTBE causes adducts to form on DNA and is a probable human carcinogen. Judge Scheindlin found that the plaintiffs proved that this part of his testimony is the product of reliable principles and methods. However, he may not testify that plaintiffs have a reasonable basis for their alleged fear of cancer.

The suits in the MDL generally allege that MTBE, which was added to gasoline at varying levels between 1979 and 2007, has leaked from underground storage tanks and contaminated groundwater. The defendants in this particular case within the MDL are the owners of two gas stations and their suppliers who allegedly contaminated 50 private water wells in the town of Fort Montgomery, N.Y. See In re: Methyl Tertiary Butyl Ether Products Liability Litigation, case number 1:00-cv-01898.

Defendants argued that Mehlman's opinion should be excluded because his methods are not generally accepted in the scientific community and because he hadn't applied those methods reliably to the facts. The absence of general acceptance in the community remains a relevant factor under Daubert.

The court noted that if a method hasn't gained general acceptance, it may be properly viewed with skepticism. But “viewing a method with skepticism is a far cry from the bright-line rule of exclusion.” The expert relied on the peer reviewed MTBE-DNA Adducts study, as well as numerous studies allegedly showing exposure to MTBE has led to cancer in animals. The court held that a vigorous cross examination by defendants at trial was the proper way to handle the issues concerning the expert’s methodology as well as its underlying assumptions. “After evaluating the evidence from both sides, the jury may well agree with defendants that MTBE does not cause cancer in humans,” the court noted.

However, the expert cannot testify that specific plaintiffs suffered subcellular damage or have a reasonable fear of cancer because he did not adequately quantify their alleged exposure. While the levels of exposure to toxic substances is sometimes difficult to precisely quantify, this does not excuse Dr. Mehlman from attempting to analyze plaintiffs' exposure levels if he intended to testify that they have a basis for their fear of cancer.

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Just when you thought it was safe to head outside to your Fourth of July picnic, parade, and swim party, an investigation by the Environmental Working Group (EWG) is released alleging that nearly 1,000 brand-name sunscreen products either fail to adequately protect consumers or contain chemicals that may pose health hazards.

Before we all cancel our plans, note the EWG study is based on non-standard methods and data, as well as subjective judgments, admittedly “customized” safety and effectiveness ratings, and “on a unique, in-house compilation” of industry, government and academic data sources. For what its worth, the study concludes that only 15% of products analyzed met EWG's subjective criteria for safety and effectiveness, blocking both UVA and UVB radiation, remaining stable in sunlight, and containing few if any ingredients with “suspected” health hazards.  It thus ignores a fairly extensive, long-standing body of scientific data, as sunscreen products have been thoroughly studied and tested, and used safely for more than 30 years.

Interestingly, the study asserts that many sunscreens contain nano-scale ingredients that raise "concerns.”  (MassTortDefense has posted on nano-technology here.) EWG asserts that powder and spray sunscreens with nano-scale ingredients raise concerns, since the small particles might be absorbed through the lungs. EWG also asserts that some sunscreens absorb into the blood and thus also raise safety concerns. “Some release skin-damaging free radicals in sunlight, some could disrupt hormone systems, several are strongly linked to allergic reactions, and others may build up in the body or the environment.”

EWG complains that the FDA has not established rigorous safety standards for sunscreen ingredients that fully examines these effects. The activist group also asserts that FDA has approved just 17 sunscreen chemicals for use in the U.S., while at least 29 are approved for use in the E.U.

However, there are currently FDA safety and effectiveness regulations that govern the manufacture and marketing of all sunscreen products. Sunscreens are classified as drugs by the FDA, and the agency requires significant safety and efficacy data on every active ingredient before it is approved for use in a sunscreen product. The agency also has broad authority to inspect manufacturers, require adherence to strict manufacturing practices, and enforce rigorous, science-based regulations to ensure that sunscreen products are safe and effective for consumers.

Moreover, the FDA in 2007 did propose a new regulation that would set standards for formulating, testing and labeling over-the-counter sunscreen products with ultraviolet A (UVA) and ultraviolet B (UVB) protection. The proposed regulation creates a consumer-friendly rating system for UVA products designed to help consumers identify the level of UVA protection offered by a product. Ratings would be derived from two tests the FDA proposes to assess the effectiveness of sunscreens in providing protection against UVA light. The first test measures a product's ability to reduce the amount of UVA radiation that passes through it. The second test measures a product's ability to prevent tanning. This test is nearly identical to the SPF test used to determine the effectiveness of UVB sunscreen products.

The finalization of the sunscreen safety standards is a complicated regulatory undertaking, addressing complex scientific principles involving countless submissions of data. FDA must thoroughly evaluate all of this information in making the best possible regulatory and scientific decision for consumers.

In the proposed regulations, a "Warnings" statement in the "Drug Facts" box will be required of all sunscreen product manufacturers. The warning would say: "UV exposure from the sun increases the risk of skin cancer, premature skin aging, and other skin damage. It is important to decrease UV exposure by limiting time in the sun, wearing protective clothing, and using a sunscreen." While the warning is intended to increase awareness that sunscreens are one part of a sun protection program, it seems likely that most adults today understand that exposure to the sun may cause skin damage, up to and including skin cancer. Skin cancer is the most common form of cancer in the United States.The American Cancer Society has long designated May as Skin Cancer Awareness Month.

Many manufacturers provide significant science and risk information on websites, as well as links to organizations such as the American Cancer Society, the American Skin Association,  the Skin Cancer Foundation, and the National Cancer Institute.

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In our last post, MassTortDefense began a discussion of the need for and process of evaluating mass torts in a merger or acquisition context. An important aspect of evaluating the possible acquisition of a target company is the potential litigation liability that may be acquired simultaneously. Even in the absence of an actual merger or stock acquisition, it may be that a buyer of corporate assets will still face exposure to product litigation liability risks.

Mass Tort Due Diligence: Goals and Methodology

The due diligence analysis to help answer the question “What am I buying into?” may involve actual data and dollars. But, requiring as it does judgments about the future litigation environment, it may not result in a precise numerical risk estimate. Thus, the buyer will ultimately make a business judgment about the range of risks that are acceptable in light of numerous factors, including assets available to cover the risks (such as insurance and indemnifications), and the financial benefits of the deal.

Experience has shown the optimal approach to the mass tort due diligence inquiry is to approach the risk question from numerous distinct perspectives, and then combine the learning from the approaches to help minimize the impact of gaps in knowledge. This allows extrapolations to be made with greater confidence. (Such due diligence is best conducted by counsel with experience in the mass tort arena and the ability to apply an understanding of the forces driving product liability claims. )


Due Diligence Approaches: Claims History

If the target company has been involved in the litigation, the current claims status, the past claims history, and the trends that may be emerging will be analyzed. Together, the claims picture will be a useful, albeit imperfect, predictor of future litigation risks. New waves of plaintiffs, new scientific studies, and new revelations from internal documents are not unusual features that can morph mass tort litigation and impact the number of claims.

The due diligence process may include the number of claims filed and the current status of all filed cases. It may be important to know the types of cases, the injuries alleged, the occupations of plaintiffs, exposure scenarios alleged, and the dates of exposure to the product. In some instances, the legal theories involved may be important, as well as the status of any case aggregations. The jurisdictions in which the claims are filed can have a significant impact on claim value. The due diligence inquiry may also explore the identity of the plaintiff firms involved.

The process will almost certainly explore those cases resolved already, and the facts that have been important to settlements, motions practice, and verdicts, favorable or not. The target should provide detailed information on all settlement terms. The due diligence review should not overlook other claims costs to the target, including attorney fees and disbursements for experts. Any changing patterns in the claims or dollars should be explored as well.

There are numerous sources that may be consulted for the claims information, beyond information from the seller’s deal counsel. These include SEC filings, annual reports, press releases, court dockets, and published case reports. Another useful set of resources may include the in-house counsel managing the litigation, the outside defense attorney of the target, and the seller’s insurance company.

The Product Dimension: Usage and Sales History

A complementary approach is to gain an understanding of the product involved, its uses, marketing, and warnings; the nature of the alleged defects; and the regulatory environment governing such products. Product usage and sales can help form an estimate of the population from which actual claimants may arise. This approach might include a historical dimension, if the product changed at any point in design or in its warnings. The useful life of the product can help determine whether the hazards are confined to a certain time frame or may extend beyond sales dates. An underrated factor is how easy it would be for plaintiffs to identify the target’s brand as the actual brand they used. Due diligence may want to examine the sales records that would allow plaintiffs to identify the acquisition target as the relevant manufacturer.

The chain of distribution may be traced to analyze the consumers the target sold to, and thus the potential plaintiffs. For example, the customers may be part of an older population which is diminishing actuarially. Similarly, it may be provident to assess how claimants could have been exposed to the product, with an eye to the credibility of alleged exposure scenarios. Beyond end users, other potential plaintiffs may be involved, including installers, repairers, and bystanders.

While plaintiffs’ lawyers are often unencumbered by such products facts when they sue, the number of units sold, over what time period, and used by which consumers in what ways, may still be instructive of future risk.

The Medicine and Science of Potential Claims

The third recommended approach begins with the proposition that the science of plaintiffs’ claims can dramatically impact the litigation in either direction. For example, even if a company has stopped selling a product, if the latency period is 30 years, the company can theoretically see claims for three decades after stopping sales. Another science issue may be “general causation,” the ability of the product to cause the type of injury alleged. There may also be a need to assess “specific causation” in the litigation. That is, even if a product is capable of causing a disease, it does not necessarily mean that all product users with the disease got it from the product.

These medical and scientific issues associated with a product’s hazards can impact the size of the potential universe of claimants, the causation issue, and even the availability of additional, novel claims against the target company, such as medical monitoring.

The Rest of the Story: Assets

The due diligence inquiry may also include an investigation of the assets available to respond to possible litigation costs, including defense costs. This may involve contractual indemnification, or possible contribution or indemnification claims available as a matter of statutory or common law against others in the product’s chain of distribution. It may include a review of insurance and the status of any coverage litigation.

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For today’s post, MassTortDefense takes a step away from our usual fare of recent decisions and current events to discuss a broader topic: evaluating mass torts in a merger or acquisition context.

Acquiring Litigation Liability and Structural Considerations

An important aspect of evaluating the possible acquisition of a target company is the potential litigation liability that may be acquired simultaneously. If a target company is involved, or could potentially become involved, in mass tort litigation, it presents both risk and opportunity to the acquirer. The threat of this type of litigation may result in the opportunity to acquire a target at a below-market valuation multiple, and the uncertainty caused by mass tort exposure can result in valuation discounts that make the attendant risk acceptable. There are potentially significant risks, however, associated with mass tort litigation exposure, and thus buyers must proceed carefully. In the private equity context, in particular, mass tort litigation exposure can adversely impact the ability to secure third-party debt financing and can have an adverse impact on investment exit. Private equity purchasers may have shorter investment time frames than strategic buyers, and mass tort litigation often takes a substantial amount of time to resolve itself.

The general rule of law, and the typical structure of an asset purchase agreement, is that an acquirer of the assets of another corporation for cash does not acquire the liability for prior injuries caused by products sold by the target company prior to closing. Even when the parties purport to allocate such liability to the target, however, the buyer may find itself responsible for the litigation through the operation of various legal doctrines that are exceptions to the general rule.

The Restatement (Third) of Product Liability Law notes that a business entity that acquires assets of a predecessor business entity is subject to liability for harm caused by a defective product sold by the predecessor if the acquisition results from a fraudulent conveyance to escape liability for the liabilities of the predecessor, or results in the successor becoming a mere continuation of the predecessor. A few states also add the so-called “product line” exception, which allows a plaintiff to recover for injuries caused by a defective product sold by the predecessor in cases in which the successor corporation has continued the predecessor’s product line.

Thus, even in the absence of an actual merger or stock acquisition, it may be that a buyer of corporate assets will still face exposure to product litigation liability risks. Attempting to structure the deal to try to minimize the possible application of such theories will often be the first line of defense. In an asset sale, the buyer may also want to seek a provision that the seller shall not dissolve for some set period of time, so that the mass tort plaintiffs’ remedies seemingly are not destroyed. Special indemnification by the seller for the underlying exposure is another alternative. This indemnification should survive for a sufficient period of time, and ideally would not be subject to a special cap higher than is typical for representations made by a “clean” company. The use of a special escrow to set aside funds for the litigation indemnification may be important.

When the target company is involved in mass tort litigation, the successor liability risks to the buyer must be examined even more carefully. Buyers must recognize that the successor liability determination may be made by a state court confronting thousands of tort suits and applying the law of the home state of the plaintiff who, absent a finding of successor liability, may be without an adequate remedy. It may not be possible for a buyer to negotiate indemnification that lasts long enough, or is backed by a large enough escrow to eliminate material risks. Thus, it may be a mistake to rely too readily on contractual safeguards without a clear understanding of the future litigation risks.

Mass Tort Risks
A mass tort’s numerous claims pose incredible financial risks, as evidenced by the bankruptcies of large, otherwise prosperous entities because of such litigation. A simple snapshot of any current litigation may understate the potential number of claims, especially if there is a long latency period—the time between exposure to the product at issue and manifestation of the disease allegedly caused by the product. Aggregation of many claims in one procedure, such as a class action, may create an all-or-nothing risk for defendants, compelling what some courts term “blackmail settlements.” Even if the risks of being found liable as a successor seem small, the magnitude of the possible harm generated by the mass tort dictates that the due diligence process carefully evaluate the potential liability.

Mass Tort Due Diligence: Goals and Methodology

The due diligence analysis to help answer the question “What am I buying into?” may involve actual data and dollars. But, requiring as it does judgments about the future litigation environment, it may not result in a precise numerical risk estimate. Thus, the buyer will ultimately make a business judgment about the range of risks that are acceptable in light of numerous factors, including assets available to cover the risks (such as insurance and indemnifications), and the financial benefits of the deal.

Experience has shown the optimal approach to the mass tort due diligence inquiry is to approach the risk question from numerous distinct perspectives, and then combine the learning from the approaches to help minimize the impact of gaps in knowledge. This allows extrapolations to be made with greater confidence.

In the next post, MassTortDefense will describe three such perspectives that can offer insight.

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A Cardiovascular and Renal Drugs Advisory Committee to the FDA held a public meeting last week to discuss safety considerations in the development of ultrasound contrast agents. Briefing information from the FDA found here.

The meeting comes in the midst of litigation concerning this important type of medical product. For example, about 70 cases have been filed in more than a dozen jurisdictions alleging that gadolinium-based injectable contrast agents cause serious health problems. Plaintiffs claim that gadolinium in contrast solutions used in magnetic imaging causes Nephrogenic Systemic Fibrosis. The federal suits were consolidated in February into an MDL in the U.S. District Court for the Northern District of Ohio. IN RE: GADOLINIUM BASED CONTRAST AGENTS PRODUCTS LIABILITY LITIGATION, MDL No. 1909. The parties made science presentations to the the Court in April, 2008.

Representatives for the makers told panelists this week that the agents are not unduly unsafe and noted that many patients given the agents are already very sick. A number of physicians speaking to the panel urged further study, but said medical information gathered through use of the contrast agents outweighed their side effects. The agents give life-saving information.

Ultrasound contrast agents are "microbubble" (or "microsphere") drugs that are injected into the vascular system in order to improve the diagnostic information obtained from ultrasound-based images. The ultrasound contrast agents approved by the FDA are used in ultrasounds, such as echocardiography, and assist in the diagnosis of various conditions. The uniqueness of the physical and chemical properties of the ultrasound contrast agents, the technicalities of the ultrasound field and its rapid technical advances, combined with the unique design considerations for clinical studies of diagnostic imaging agents have all presented special challenges in the clinical development and optimal use of these agents.

The advisory committee was created to provide a public forum for review of the history of the currently marketed ultrasound contrast agents, to obtain opinions from the advisors regarding safety considerations in the development of these agents, and to begin to familiarize the committee members with the review of diagnostic imaging agents.

According to the FDA, post-marketing reports and new animal data prompted label changes for certain of these products in October, 2007. These changes included a black-box warning and contraindication for use of the products in certain patients with underlying cardiopulmonary conditions.

FDA has most recently been working with the manufacturers to develop a risk assessment and management program. In addition to physician education and enhanced oversight of clinical studies, this program consists of two studies. One is an observational study to be conducted using an administrative database in which mortality will be compared between critically ill patients who receive a contrast-enhanced echocardiogram and critically ill patients who undergo echocardiography without contrast. The second study will obtain pulmonary hemodynamic data from patients who are undergoing right heart catheterization as well as contrast-enhanced echocardiography.

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The U.S. Supreme Court has issued an opinion reducing the amount of the award of punitive damages against Exxon Mobil Corp. related to the 1989 Exxon Valdez oil spill – from $2.5 billion to just $507 million, an amount equal to the compensatory damages in the case. Exxon Shipping Co. v. Baker, 2008 WL 2511219 (U.S., June 25, 2008).

In a 5-3 decision, the Court found that a 1-to-1 ratio of compensatory to punitive damages was appropriate in the case, in which more than 32,000 fishermen and Alaska native citizens sought remedies after the tanker accident spilled approximately 11 million gallons of oil into Prince William Sound. At Phase I of the trial, the jury found Exxon and the ship’s Captain Hazelwood reckless (and thus potentially liable for punitive damages) under instructions providing that a corporation is responsible for the reckless acts of employees acting in a managerial capacity in the scope of their employment. In Phase II, the jury awarded compensatory damages to some of the plaintiffs; others had settled their compensatory claims. In Phase III, the jury awarded $5,000 in punitive damages against Hazelwood and $5 billion against Exxon. The punitive issue has yo-yoed between the District Court and the Ninth Circuit, which eventually in December 2006, reduced the award to $2.5 billion, saying ExxonMobil’s conduct was not intentional and that the rate of punitive damages to actual economic harm exceeded what was appropriate under recent Supreme Court precedent.

Supreme Court View

The Court addressed several issues:

1. Because the Court was equally divided on whether maritime law allows corporate liability for punitive damages based on the acts of managerial agents, it left the Ninth Circuit's opinion undisturbed in this respect (the Ninth Circuit found that ExxonMobil was not exempt from punitive damages).

2. The Clean Water Act's water pollution penalties do not preempt punitive-damages awards in maritime spill cases. Nothing in the statute points to that result, and the Court had rejected similar attempts to sever remedies from their causes of action. There is no clear indication of  congressional intent to occupy the entire field of pollution remedies, nor is it likely that punitive damages for private harms will have any frustrating effect on the CWA's remedial scheme.

3. The punitive damages award against Exxon was excessive as a matter of maritime common law. In the circumstances of this case, the award should be limited to an amount equal to compensatory damages.

And it is this last point likely of most interest to readers of MassTortDefense. Since maritime
law falls under federal jurisdiction, the Court served as a common law court in the case. Rather than the constitutional due process analysis seen in recent punitive damages decisions, see, e.g., State Farm Mut. Automobile Ins. Co. v. Campbell, 538 U.S. 408, the approach was one of fashioning federal common law, giving observers, perhaps, some insight into the Court’s views of punitive generally.

The Court observed that one of the real problems with punitive damages is the stark unpredictability of punitive awards. Courts ought to be concerned with fairness and consistency, and the available punitive damages data suggest that the spread between high and low individual awards is unacceptably large. The spread in state civil trials is especially great, and the outlier cases subject defendants to punitive damages that dwarf the corresponding compensatories. These ranges might be acceptable if they resulted from honest efforts to reach a generally accepted optimal level of penalty and deterrence in specific cases involving a wide range of circumstances, but evidence suggests that is not the case.

The unpredictability of high punitive awards is in tension with their punitive function because of the implication of unfairness that an eccentrically high punitive verdict carries. A penalty should be reasonably predictable in its severity, so that even Justice Holmes's proverbial “bad man” can look ahead with some ability to know what the stakes are in choosing one course of action or another. And a penalty scheme ought to threaten defendants with a fair probability of suffering in like degree for like damage. Justice Souter thus argued that reducing punitive damages actually will better allow them to achieve their goal of acting as a deterrent and a punishment – by making them more predictable.


The Court was skeptical that verbal formulations are adequate insurance against unpredictable outlier punitive awards, and the option of setting a hard-dollar punitive cap was rejected because there is no “standard” tort or contract injury, making it difficult to settle upon a particular dollar figure that would be appropriate across the board. The most promising alternative was to peg punitive awards to compensatory damages using a ratio. This is the approach used in many states and in analogous federal statutes allowing multiple damages.

Based on studies of thousands of cases as to what punitive awards were appropriate in circumstances from the most blameworthy down to the least blameworthy conduct, from malice and avarice to recklessness to gross negligence, compensatory award exceed the punitive award in most cases. Accordingly, the Court found that a 1:1 ratio is a fair upper limit in maritime cases such as this.

Though the decision technically dealt only with maritime liability, some are hailing it as a reasonable way to assess punitive damages generally, particularly on a company that did not intentionally harm the environment. Time will tell whether the decision could have an effect far beyond federal maritime law, cabining unpredictable punitive damages (the way Metro-North Commuter R. Co. v. Buckley, 521 U.S. 424 (1997) impacted medical monitoring claims in the states).

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The United States and China issued a joint progress statement last week that described the measures both have recently taken to improve the safety of international food and feed imports.
The safety of a variety of products and substances imported from China have been in the news, ranging from pet food, to toothpaste, to toys, to pharmaceutical ingredients. MassTortDefense has posted on this here and here.

According to the statement, both countries have improved the exchange of information on food safety and on the relevant regulatory systems. The U.S. has agreed to conduct training for Chinese officials on U.S. regulatory standards. Each has designated new emergency contacts and notification thresholds for import safety issues. The two countries have also been working towards an electronic certification system between the FDA and China's General Administration of Quality Supervision, Inspection and Quarantine to ensure that Chinese exports meet FDA standards for safety and manufacturing quality. The countries also agreed to increase their focus on inspection, supervision and laboratory testing of Chinese imports.

The document outlines steps taken by both nations in implementing the 2007 Memorandum of Agreement (MOA) on food and feed safety. The MOA established a bilateral mechanism to provide greater information and other assurances to enhance the safety of food and feed products traded between the two countries.

Finally, the report described the establishment of a cooperative mechanism to notify each other of significant risks to public health related to product safety or the gross deception of consumers, and to share information to facilitate each other’s investigation.

The report comes as Senator Sherrod Brown (D.-Ohio), in a letter to the FDA's Center for Drug Evaluation & Research, called on the agency to investigate outsourcing of drug ingredients, and just as China has granted diplomatic approval for the FDA to open three inspections offices in China that also will help increase China's ability to ensure delivery of safe foods, drugs and other products. The FDA reportedly hopes to open the offices in Beijing, Shanghai and Guangzhou before the end of this year, with a total staff of around 12 people.

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