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

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The Ninth Circuit last week reversed the certification of a nationwide class raising consumer fraud claims against an auto maker. See Mazza, et al. v. American Honda Motor Co., No. 09-55376 (9th Circuit). 

Honda appealed the district court’s decision to certify a nationwide class of all consumers who purchased or leased Acura RL's equipped with a Collision Mitigation Braking System (“CMBS”). The plaintiffs alleged that certain advertisements misrepresented the characteristics of the CMBS and supposedly omitted material information on its limitations. The complaint stated four claims under California Law, specifically the California Unfair Competition Law (UCL), Cal. Bus. & Prof. Code § 17200 et seq., False Advertising Law (FAL), Cal. Bus. & Prof. Code § 17500 et seq., the Consumer Legal Remedies Act (CLRA), Cal. Civil Code § 1750 et seq., and a claim for unjust enrichment.  Readers know those are the typical claims in a consumer fraud case in the popular forum of California.

The Ninth Circuit held that the district court erred because it erroneously concluded that California law could be applied to the entire nationwide class, and because it erroneously concluded that all consumers who purchased or leased the relevant Acura RL can be presumed to have relied on defendant’s advertisements, which allegedly were misleading and omitted material information.

In 2007, plaintiffs bought Acura RL's from authorized Acura dealerships, and the vehicles were equipped with the CMB System. In December 2007, they filed a class action complaint alleging
that Honda misrepresented and concealed material information in connection with the marketing and sale of Acura RL vehicles equipped with the CMBS. According to Plaintiffs, Honda did not warn consumers (1) that its CMB collision avoidance system’s three separate stages may "overlap,"  (2) that the system may not warn drivers in time to avoid an accident, and (3) that it allegedly shuts off in bad weather.

The district court certified a nationwide class of people in the United States who, between August 17, 2005 and the date of class certification, purchased or leased new or used Acura RL vehicles
equipped with the CMBS. The district court concluded that California law could be applied to all class members because Honda did not show how the differences in the laws of the various states were material, how other states might have an interest in applying their laws in this case, and how these interests were implicated in this litigation. It also held that class members were entitled to an
inference of reliance under California law.

Before certifying a class, the trial court must conduct a rigorous analysis to determine whether the party seeking certification has met the prerequisites of Rule 23.  The party seeking class certification has the burden of affirmatively demonstrating that the class meets the requirements
of Federal Rule of Civil Procedure 23. And, under Rule 23(b)(3), a plaintiff must demonstrate the
superiority of maintaining a class action and show that the questions of law or fact common to class members predominate over any questions affecting only individual members.  Here, Honda contended that common issues of law did not predominate because California’s consumer protection statutes may not be applied to a nationwide class with members in 44 jurisdictions.
It further contended that common issues of fact did not predominate because the court  impermissibly relied on presumptions that all class members were exposed to the allegedly
misleading advertising, that they relied on misleading information in making their purchasing decision, and that they were damaged as a result.

First, choice of law. Under California’s choice of law rules, the class action proponent bears the initial burden to show that California has significant contact to the claims of each class member. Also, California law may only be used on a class-wide basis if the interests of other states are not found to outweigh California’s interest in having its law applied.  Honda argued that the district court misapplied the three-step governmental interest test.  The Ninth Circuit agreed. The district court abused its discretion in certifying a class under California law that contained class members
who purchased or leased their car in different jurisdictions with materially different consumer protection laws.  For example, some state consumer fraud laws have no scienter requirement, whereas many other states’ consumer protection statutes do require scienter. See, e.g., Colo.
Rev. Stat. 6-1-105(1)(e), (g), (u) (knowingly); N.J. Stat. Ann. § 56:8-2 (knowledge and intent for omissions); Debbs v. Chrysler Corp., 810 A.2d 137, 155 (Pa. Super. 2002) (knowledge
or reckless disregard).  Some states require named class plaintiffs to demonstrate reliance, while some other states’ consumer protection statutes do not.  These differences are "not trivial or wholly immaterial."  

The court of appeals reminds us that consumer protection laws are a creature of the state in which they are fashioned. They may impose or not impose liability depending on policy choices made by state legislatures. Each state has an interest in setting the appropriate level of liability for companies conducting business within its territory.  Maximizing consumer and business welfare, and achieving the correct balance for society, does not inexorably favor greater consumer protection; instead, setting a baseline of corporate liability for consumer harm requires balancing these competing interests.  Getting the optimal balance between protecting consumers and attracting foreign businesses, with resulting increase in commerce and jobs, is not so much a policy decision committed to a federal appellate court, or to particular district courts where a plaintiff may sue, as it is a decision properly to be made by the legislatures and courts of each state. More expansive consumer protection measures may mean more or greater commercial liability, which in turn may result in higher prices for consumers or a decrease in product availability.  Here, the district court did not adequately recognize that each foreign state has an interest in applying its law to transactions within its borders and that, if California law were applied to the entire class, foreign states would be impaired in their ability to calibrate liability to foster commerce.

The court of appeals also found that the district court abused its discretion in finding that common issues of fact predominated, because the scale of the advertising campaign here did not support a presumption of reliance, even if one were legally available.  It was likely that many class members were never exposed to the allegedly misleading advertisements, insofar as advertising of the challenged system was very limited. And it was not dispositive that Honda’s advertisements were allegedly misleading because of the information they omitted, rather than the information they claimed.  For everyone in the class to have been exposed to the omissions, it was necessary for everyone in the class to have viewed the allegedly misleading advertising. Here the limited scope of that advertising makes it unreasonable to assume that all class members viewed it.
Honda’s product brochures and TV commercials fell short of the extensive and long-term fraudulent advertising campaign that might support a presumption in the eyes of some courts.  Even if Honda allegedly might have been more elaborate and diligent in disclosing the limitations of the CMB system, its advertising materials did not deny that limitations exist. A presumption of reliance does not arise when class members were exposed to quite disparate information from various representatives of the defendant.  California courts have not allowed a consumer who was never exposed to an alleged false or misleading advertising campaign to recover damages under California’s UCL.  

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Another federal appeals court will have an opportunity to assess the reach of the U.S. Supreme Court's decision in J. McIntyre Machinery Ltd. v. Nicastro. In Ainsworth v. Cargotec USA Inc., No. 2:10-cv-00236 (S.D. Miss., 12/15/11), the district court certified for interlocutory appeal its opinion finding personal jurisdiction over a foreign defendant in a forklift case.

Readers will recall that Nicastro resulted in a 6-3 decision with a plurality opinion by Justice Anthony Kennedy. Justices Breyer and Alito concurring in the judgment; and Justices Ginsburg, Sotomayor and Kagan dissenting. Justice Kennedy addressed the stream of commerce notion, stating that no “stream-of-commerce” doctrine can displace that general rule of purposeful availment, even for products liability cases. He acknowledged that the standards for determining state jurisdiction over an absent party have been a bit unclear because of decades-old questions left open in Asahi Metal Indus. Co. v. Superior Court of California, 480 U.S. 102 (1987).  This imprecision arising from Asahi, for the most part, resulted from its statement of the relation between jurisdiction and the notion of placing a product in the “stream of commerce.” That concept, like other metaphors, has its "deficiencies as well as its utilities." A defendant’s placement of goods into commerce “with the expectation that they will be purchased by consumers within the forum State” may sometimes indicate purposeful availment. But that does not swallow the general rule of personal jurisdiction. The principal inquiry in cases of this sort is still whether the defendant’s activities manifest an intention to submit to the power of a sovereign. Justice Breyer, joined by Justice Alito, agreed in the result, but concluded that because this case did not present the new and special issues arising from recent changes in commerce and communication, it was unnecessary to get into full analysis of the steam of commerce issue as it might be applied to 21st century marketing.

Since then, lower courts have continued to grapple with the meaning of the decision, with most recognizing that merely depositing goods in the stream of commerce, with knowledge that some will end up in the forum state, is not enough to satisfy the minimum contacts standard for personal jurisdiction.

Here, plaintiffs were the survivors of a Mississippi resident who was struck and killed by a forklift designed and manufactured by defendant Moffett Engineering, an Irish corporation, with its principal place of business is in Dundalk, County Louth, Ireland. (This is a "wee county" steeped in myth and legend, named for a Celtic pagan god.)  Moffett has never maintained a physical presence in Mississippi. It does not own, possess, or use any property in Mississippi. It has never had any officers, employees, or agents stationed in Mississippi, and it has never sent any of its employees to Mississippi for business purposes. It has never directly shipped or sold any of its products to customers there, and it has never directly solicited business from any company located in Mississippi. Moffett sold all of its products to defendant Cargotec, which had the exclusive right to market and sell Moffett’s products pursuant to a contract which specifically defines the U.S. as Cargotec’s sales territory. Cargotec sells or markets Moffett products in all fifty states. Moffett does not attempt to limit the territory in which Cargotec sells its products. Further, Moffett does not communicate with the end-purchasers of its products in any fashion, and it is not aware of their identities or locations. Cargotec sold 203 of those forklifts to customers in Mississippi, about 1.55% of Moffett’s United States sales.

The district court previously denied Moffett’s Motion to Dismiss for lack of personal jurisdiction.
Ainsworth v. Cargotec USA, Inc., 2011 U.S. Dist. LEXIS 49665, at *21 (S.D. Miss. May 9, 2011). After that decision, the Supreme Court issued its opinion in J. McIntyre Machinery, Ltd. v. Robert Nicastro, 131 S. Ct. 2780 (2011). Moffett filed a Motion for Reconsideration, arguing that decision controlled this dispute.

The district court denied the motion again, and concluded that Justice Breyer’s Nicastro opinion was only applicable to cases presenting the same factual scenario as that case.

But the court did agree the decision involves a controlling question of law as to which there is substantial ground for difference of opinion (noting at least one decision employing the stricter analysis from Justice Kennedy’s plurality opinion, Keranos, LLC v. Analog Devices, Inc., 2011 U.S. Dist. LEXIS 102618, at *29-*30 (E.D. Tex. Sept. 12, 2011)).  Review would materially advance the litigation, concluded the court, certifying it to the Fifth Circuit.  A case to keep our eye on.

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The Ninth Circuit recently heard oral argument in a potentially significant case raising climate change issues.  See Kivalina v. Exxon Mobil Corp., No. 09-17490 (9th Cir.)(oral argument  11/28/11).

We have posted on this case before, in which the village of about 400 people 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 requires 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 the 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.

After the District Court dismissed the case, 663 F. Supp. 2d 863 (N.D. Cal. 2009), the U.S. Supreme Court rejected a global warming case brought by a number of states and land trusts that sought injunctive relief against utilities under the Clean Air Act.  See American Electric Power Co. v. Connecticut, 131 S. Ct. 2527 (2011).  The Kivalina case is potentially significant as one of the first to apply and interpret the Supreme Court decision limiting climate change lawsuits under federal common law.
 

The plaintiffs in Kivalina argue that the AEP decision focused exclusively on injunctive relief and did not address damage claims under federal common law. Kivalina does not seek to set emissions caps. It seeks damages, they argued.  But that reading of the decision may overstate the importance of that fact; the Court focused on the issue of injunctive relief arguably because that was what was being sought by the states and land trusts.  Defendants argued that displacement of the federal common law applies to both injunctive and damages remedies.  When Congress crafted the regulatory framework establishing the Clean Air Act, it did not provide for any compensatory relief to an allegedly injured private party. Accordingly, a damages remedy should also be displaced.  Recognizing the nuisance theory in this context would enable a federal judge to substitute a different balancing of interests from the one made by the EPA, to which Congress assigned this function.

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While we at MassTortDefense usually focus on the results of appellate advocacy, earlier this  week saw an interesting debate about a process issue: whether the  U.S. Supreme Court  should be required to televise oral arguments.

Attorneys and judges with strong views on putting cameras in the high court  testified at a hearing before the U.S. Senate Judiciary Committee on Tuesday.  Speakers included The Honorable Mark Cady, Chief Justice of the Iowa Supreme Court, and The Honorable Anthony Scirica, Chief Judge
United States Court of Appeals for the Third Circuit.

Judge Scirica is not in favor of the Cameras in the Courtroom Act, which was introduced by Sens. Dick Durbin, D-Ill., and Chuck Grassley, R-Iowa.  He addressed three concepts that merit consideration in this discussion—transparency, accessibility, and the respect among the branches that allows each to govern its own deliberations.  He argued that the Court is sufficiently transparent: it explains its decisions in detail. Traditionally this was done through the printed word; now it is done through the electronic word as well, with opinions available on-line as soon as the decision is announced. These opinions constitute are binding precedent on questions of federal law.  Dissenting and concurring opinions by other Justices highlight for the public precisely, and at times quite forcefully, where the members of the Court disagree. Even before a final disposition, where certiorari has been granted, its website links to the lawyers’ briefs so the public may read and download them. Of course, all Court sessions have always been open to the public. But the Court now provides same-day transcripts of oral arguments on its website.

Judge Scirica noted how some lower court judges feel that televisions in the court disrupt courtroom proceedings at least to some extent, while others believe it makes lawyers more theatrical (is that possible?).  Others suggested it may cause judges to alter their questioning during arguments. Many district court judges have also expressed concern over cameras’ effect on witnesses and jurors.

Bottom line, he suggested that the complexities of this issue underscore the considerable latitude that should be afforded the Supreme Court in determining its own internal procedures. Determining whether to televise proceedings goes to the heart of how the Court deliberates and conducts its proceedings.

Senator Leahy, however, stated that the time has come for the Supreme Court to voluntarily open their proceedings to the American people. The high court's upcoming review of the Affordable Care Act, is a significant moment in our nation's history and our understanding of our fundamental charter. This decision will affect every one of us in this country. "The American people deserve to know what is being said as it is being said," he urged.  

The publisher of the outstanding SCOTUSblog wryly noted that the Justices are among the few people in Washington not trying to get on television.  He suggested that televising proceedings would ultimately be good for the Supreme Court, but favored the approach of the Sunshine in the Courtroom Act of 2011, a bill he said demonstrates critical respect for the separation of powers by respecting the judiciary’s autonomy in choosing whether to implement cameras for use.

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Today we note an opinion that, in its opening words, is about "two appeals that raise concerns about appellate advocacy." Both are appeals from grants of forum non conveniens in multidistrict litigation. See Gonzalez-Servin et al. v. Ford Motor Co. et al., No. 11-1665; Kerman et al. v. Bayer Corp. et al., No. 08-2792 (7th Cir. 2011).

The Ford case was an appeal from an order to transfer a case from the U.S. District Court for the Southern District of Indiana to the courts of Mexico, and was one of many offshoots of litigation arising out of vehicular accidents allegedly caused by defects in Bridgestone/Firestone tires installed on Ford vehicles.  All these cases have been consolidated in an MDL.

The 7th Circuit found the lower court's careful and thorough analysis demonstrated that it was acting well within its discretion in deciding that the Mexican courts would be a more appropriate forum for the adjudication of this lawsuit by Mexican citizens arising from the death of another Mexican citizen in an accident in Mexico.

What seemed to bother the panel is that plaintiffs did not cite an FNC case seemingly on all fours with the appeal in their opening brief, though the district court’s decision in their case was issued in 2011—long after the prior case.  In their response the defendants cited the case repeatedly and asserted that its circumstances were “nearly identical” to those of the present case. Yet, in their reply brief the appellants still didn't mention it, let alone try to distinguish it, said the panel.

The second case involved litigation against manufacturers of blood products used by hemophiliacs, which turned out to be contaminated by HIV.  This particular suit was brought by Israeli citizens allegedly infected by the blood products in Israel. The defendants, invoking forum non conveniens, moved to transfer the case to Israel.  There were two prior appellate decisions on point, said the panel, including Chang v. Baxter Healthcare Corp., 599 F.3d 728 (7th Cir. 2010), which arose from the same multidistrict litigation.  The court said that these plaintiffs' short treatment of the prior cases "left much to be desired." 

Overall, said the court, the plaintiffs' "advocacy is unacceptable." The panel then invoked a well-known symbol: "The ostrich is a noble animal, but not a proper model for an appellate  advocate."  The “ostrich-like tactic of pretending that potentially dispositive authority against a litigant’s contention does not exist" is "pointless,” said the court.

The opinion closes with pictures of an ostrich burying his head in the sand, and of a man in a suit doing the same.  The reminder here is, when there is apparently dispositive precedent, an appellant may urge its overruling, or distinguish it, or reserve a challenge to it for a petition for certiorari, but may not ignore it. 

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DRI (the Defense Research Institute) last week submitted an amicus brief urging the Supreme Court to review a federal appeals court decision that threatens to undermine the gatekeeper role of the trial courts on expert testimony. United States Steel Corp. v. Milward v. Acuity Specialty Products Group Inc., No. 11-316 ( U.S., amicus petition filed 10/12/2011).

Most of our readers know that DRI is an international organization that includes more than 23,000 attorneys involved in the defense of civil litigation.  DRI has long been a voice in the ongoing effort to make the civil justice system more fair, efficient, and—where national issues are involved—consistent. (Your humble blogger is a member.)

In this case, the plaintiff alleged that he contracted a rare form of cancer, acute promyelocytic leukemia (APL), through exposure to benzene or benzene contaminants. The plaintiff’s expert acknowledged that science has not determined what causes or can cause APL, but opined that, based on his own "judgment," the "weight of evidence" supported a conclusion that APL could be caused by benzene exposure. After a four-day hearing, the district court excluded the expert testimony as unreliable under Daubert, and Gen. Elec. Co. v. Joiner, 522 U.S. 136 (1997)(district courts need to exclude proof that is connected to the data only by the ipse dixit of an expert), finding that it amounted to no more than a plausible hypothesis. The U.S. Court of Appeals for the First Circuit reversed and reinstated the case, holding that it was an abuse discretion to exclude this evidence as to possible causation.

The First Circuit in this case appeared to think that district courts not only may but must admit speculative expert testimony that rests on nothing more than the expert’s subjective judgment that an untested hypothesis is supported by the “weight of the evidence.”  That decision conflicts with Supreme Court guidance and with the decisions of other circuits holding that expert testimony is admissible only when it rests on a reliable scientific foundation, and that a district court is not required to accept an expert’s ipse dixit but must instead carefully examine the methods and data underlying the expert’s opinion to ensure that the expert has reliably applied valid scientific principles. Without such an inquiry, the “gatekeeper” function the Federal Rules of Evidence envision for the district court judge becomes meaningless.

DRI correctly points out that the weight-of-the-evidence methodology the court of appeals endorsed does not satisfy the criteria Daubert adopted for assessing the reliability of expert testimony. It is neither testable nor falsifiable; it is not governed by any objective standards; and it has not been generally accepted by the scientific community as a means to assess medical causation absent an observed association between the substance and disease at issue. The fact that some regulatory agencies use an arguably similar, lower bar, methodology to assess risks to public health based on the available data does not mean that it yields “scientific knowledge” admissible under the very different standards governing a court proceeding.

Moreover, the district court’s essential gate-keeping role is particularly important on the issue of medical causation. That issue is often dispositive in toxic tort and product liability cases, which can involve enormous stakes not only for the parties, but also for the national economy. The lay jurors who decide these complicated issues are likely to be greatly influenced by testimony that appears to be scientific in nature coming from a witness whom the court has admitted as an "expert." The decision by the First Circuit undermines the critical screening function district courts perform to prevent juries from being misled by speculation masquerading as scientific knowledge.

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Last week, the First Circuit dismissed for lack of standing a class member's challenge to the significant fee award to class counsel in the Volkswagen AG/Audi AG MDL. In re Volkswagen and Audi Warranty Extension Litigation, MDL No. 1790.
 

The MDL included litigation over alleged oil sludge buildup in engines in the vehicles, and involved about 480,000 cars. The parties reached a settlement under which the automakers had agreed to cover the sludge-related maintenance costs for owners or lessees of Audi A4s from certain model years and Volkswagen Passats from specific model years, if the owners could document required oil changes.

The court also approved an award of $30 million in fees to the firms representing the plaintiffs, which drew the fire of class member Ashley Birkeland.  Her appeal of this issue was rejected last week, however, by the 1st Circuit, which dismissed for lack of standing. The court concluded that appellant suffered no redressable injury from the fee award. She did not allege, for example, that class counsel sold the class short as part of a collusive fee agreement. See Glasser v.  Volkswagen of America, Inc., 645 F.3d 1084, 1088-89 (9th Cir. 2011). Nor did she allege any improper supplemental agreement between plaintiffs counsel and defendant. Cf. In re Cendant Corp. PRIDES Litig., 243 F.3d 722, 726 & n.4 (3d Cir. 2001).

The court held that Fed. R. Civ. P. 23(h)(2) does not effectively confer standing to appeal on such appellants. "The district court's jurisdiction to review fee applications with the input of objectors is one thing; our appellate jurisdiction is another."

The court's reasoning seemed to reflect the view that the defendants, Volkswagen and Audi, and not class members, would be paying class counsel's fees -- implicitly rejecting the notion that such settlements are a zero-sum game based on a total that a defendant is willing to pay (and calculates it will have to pay in total), so every dollar in fees is a dollar less to the class members. 

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Readers know that tort reform is an important issue we have posted on before, at the federal and state level.  Latest update: Tennessee recently enacted reform legislation that will, among other things, limit the amount of non-economic damages that plaintiffs can recover in civil lawsuits.

Specifically, the Tennessee Civil Justice Act of 2011 was signed into law by Gov. Bill Haslam earlier this month. 

The new law limits venue to the county where the events constituting the cause of action occurred, where the business has its principal office, or where its registered agent of record is located.

Prior law included punitive damages in calculating the bond amount, set a maximum appeal bond at $75 million, and did not address the possibility that obtaining the bond could render an appellant bankrupt or insolvent. The amended law facilitates the appeal of a trial court verdict by lowering the maximum amount of a bond from $75 million to the greater of (i) $25 million or (ii) 125% of the judgment amount. In determining the bond amount, the court will now not consider or include punitive damages, unless there is evidence of the appellee dissipating assets. The law also gives the court discretion to take other actions or set other terms, if obtaining the bond would render the appellant insolvent or bankrupt.

Prior state law had no cap on non-economic damages. The new law places a cap of $750,000 on the non-economic damages incurred by an injured plaintiff, damages like pain and suffering.  A few exceptions are provided, such as no cap in intentional torts, or when the defendant was under the influence of alcohol or illegal drugs and his or her judgment was substantially impaired, or when a defendant intentionally falsified, destroyed or concealed records to avoid liability.

Prior state law did not have caps on punitive damages. Under the new act, punitive damages must be proven by clear and convincing evidence and are capped at 2x compensatory damages or $500,000, whichever is greater. There are limited instances when the defendant's liability is not limited by the caps: (i) if the defendant intended to injure the plaintiff, (ii) if the defendant was under the influence of alcohol or illegal drugs and his or her judgment was substantially impaired, and (iii) if the defendant intentionally falsified, destroyed or concealed records to avoid liability.  Moreover, no punitive damages may be assessed against the manufacturer of a drug or device who was in compliance with applicable laws and regulations, unless the manufacturer withheld material information from regulators or misrepresented that information to the regulators.

The new law provides additional protections for non-manufacturer product sellers. No product liability action may be commenced or maintained against any seller, other than the manufacturer, unless the seller exercised substantial control over that aspect of the design, testing, manufacture, packaging or labeling of the product that caused the alleged harm for which recovery of damages is sought, or the seller altered or modified the product, and the alteration or modification was a substantial factor in causing the harm for which recovery of damages is sought; or the seller gave an express warranty which was breached.

Also, the seller of a product other than the manufacturer would not be liable for punitive damages, unless the seller exercised substantial control over that aspect of the design, testing, manufacture, packaging or labeling of the product that caused the harm for which recovery of damages is sought; the seller altered or modified the product and the alteration or modification was a substantial factor in causing the harm for which recovery of damages is sought; or the seller had actual knowledge of the defective condition of the product at the time he supplied the same.

Under the new Act, the state court of appeals would hear appeals from orders of trial courts granting or denying class action certification if a notice of appeal is filed within 10 days after entry of the order. All proceedings in the trial court would be automatically stayed pending the appeal of the class certification ruling.

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Latest round in the "global warming" litigation -- Coming as no surprise, a group of property owners asked the U.S. Supreme Court last week to address issues arising in the appeal of their climate change tort lawsuit.  The suit seeks to hold a group of energy companies liable for alleged hurricane damage to their properties.  See In re: Comer, No. 10-294 (U.S. petition for writ of mandamus filed 8/26/10). The causation allegation in this particular case is arguably even more attenuated than the long, convoluted causation chain in many 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 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 procedural history is fascinating.  The U.S. District Court for the Southern District of Mississippi dismissed the complaint in August, 2007 for lack of standing and as a non-justiciable political question. See Comer v. Murphy Oil USA, Inc., 2007 WL 6942285 (S.D.Miss. 2007). 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, among many reasons,  climate change, and tort claims based on alleged climate change, is fraught with national political and policy considerations.

Plaintiffs appealed, and a three-judge panel of the 5th Circuit reversed that decision in October, 2009.  But the defendants petitioned for a rehearing en banc, and the Circuit ordered en banc rehearing of the case. Comer et al. v. Murphy Oil USA et al., No. 07-60756 (5th Cir.). That vacated the panel opinion.

Then came a letter from the clerk noting the cancellation of en banc oral arguments. Apparently, since the en banc court was constituted, new circumstances had arisen that made it necessary for various judges to recuse, leaving only eight members of the court able to participate in the case. Consequently, said the clerk, the en banc court had lost its quorum. (Several members of the court had previously recused themselves from the case.)  The court then asked for supplemental briefing on what should happen next.

Following the briefing, in an opinion of the majority of the remaining judges, the 5th Circuit held that it could not give the climate-related lawsuit full court review because of the recusal issues. See Comer v. Murphy Oil USA, 607 F.3d 1049 (5th Cir. 2010).  As a result, the court let stand the lower court's dismissal of the lawsuit.

The plaintiffs in this case have now filed a petition seeking a writ of mandamus that would overturn the dismissal of their appeal. They raise not the merits of their convoluted causation theory, but the procedural questions about when an en banc court loses its quorum after granting rehearing but before hearing argument en banc, what happens to the appeal? And when an en banc court loses its quorum before deciding an appeal on rehearing en banc, does the original panel somehow still maintain control over the case?

Thus, the case is not positioned like the Second Circuit appeal in which the federal government (Acting Solicitor General Neal Katyal on behalf of the Tennessee Valley Authority, a government-owned company), recently 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 know that writs of mandamus are rarely granted by the Supreme Court,  and the rule has traditionally been that once a court of appeals takes a case for en banc decision, the original panel decision is vacated, null and void, regardless of whatever happens next.  The 5th Circuit cannot legally reinstate a decision that no longer has any legal effect.  But stay tuned.

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The Third Circuit has properly recognized that a claim for medical monitoring claim does not lie against the manufacturer of a medical device product. See M.G. v. A.I. DuPont Hospital for Children, No. 09-1426 (3d Cir., 8/24/10).

Readers may recall the post about this appeal last year.  Doctors at the A.I. duPont Hospital for Children in Wilmington, Delaware, had implanted a Cheatham Platinum stent (“CP stent”) in plaintiffs, who alleged that they had been injured or were at risk of injury from the use of the CP stent. After discovery, the trial court granted summary judgment to defendants on a number of the claims, but summary judgment was denied on Count VI, the medical monitoring claim. The trial court predicted that the Delaware Supreme Court would recognize a medical monitoring cause of action if presented with the facts of these cases.

The trial court recognized that there were substantial grounds for disagreement over whether Delaware will actually recognize a cause of action for medical monitoring. Even if the Delaware Supreme Court were to recognize a medical monitoring claim, there were substantial grounds for disagreement over whether plaintiffs here could state a claim. Plaintiffs' specific theory that medical devices can be the basis for a medical monitoring claim is novel, at best (and has been rejected in many states: Drugs and devices do not present the same policy issues as involuntary exposure to environmental toxins). The trial court was satisfied that plaintiff's novel theory here was one in which certification of an interlocutory order for appeal was appropriate.

The Third Circuit noted that plaintiff’s claim entitled “Medical Monitoring” contended that “[a]s a direct result of defendants’ acts, omissions, and conduct, plaintiffs . . . who have received NuMED CP stent have been exposed to a hazardous procedure and product, and suffered a significantly increased risk of the side effects caused by this device. This increased risk makes periodic diagnostic and medical examinations reasonable and necessary.”

While the district court predicted that the Delaware Supreme Court would recognize a medical monitoring cause of action, the appeals court didn't have to reach that broader question because it concluded that plaintiffs were unable to establish the elements necessary to state a claim for medical monitoring.

Defendants contended on appeal  that the trial court erred in extending Delaware law beyond the bounds of the recognized medical monitoring claim (in those minority of states that accept it) in which a plaintiff alleges long-term involuntary exposure to a proven toxic substance with known tendencies to produce serious future medical injuries. The Third Circuit agreed, finding no persuasive cases anywhere in which a free-standing medical monitoring claim has been allowed to proceed although the plaintiff has not demonstrated significant exposure to a toxic (poisonous) or proven hazardous substance. The lower court’s prediction that the Delaware Supreme Court would permit a claim for medical monitoring on this record thus requires several “leaps” from the current state of the law, generally, let alone Delaware law.

Specifically, here, there was no toxic or hazardous substance, as such. While unapproved devices are termed “adulterated”, they are not necessarily harmful, and certainly not toxic. Moreover, the risk here is not a risk of  “contracting a serious latent disease.” Rather, it is a risk of the need for further care. Further examinations are not to “monitor” the risk of disease, but to perform routine
oversight of the device. Thus, even if the Delaware Supreme Court would recognize a “standard” medical monitoring claim --one which requires a plaintiff to demonstrate that a defendant’s
negligence caused the plaintiff to be exposed to a proven hazardous substance that resulted in a significantly increased risk of contracting a serious latent disease -- the plaintiff here could not demonstrate that she had been exposed to a proven hazardous substance, nor could she prove that such exposure resulted in a significantly increased risk of contracting a serious latent disease.

Accordingly, the court found that plaintiff was unable to establish the elements necessary to make out a claim for medical monitoring.  Summary judgment should have been granted.

On a personal note, also on the winning brief was my former partner, the late R. Nicholas Gimbel, Esq., an outstanding advocate, in one of his last cases.  On the amicus brief for PLAC was my colleague James M. Beck, Esq.
 

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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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The Seventh Circuit has affirmed a district court's ruling which dismissed Taiwanese plaintiffs' claims against blood product manufacturers on statute of limitations and forum non conveniens grounds. Chang v. Baxter Healthcare Corp., 2010 WL 1136521 (7th Cir. 3/26/10).

Because my colleague Dave Walk was part of the winning defense team, just the facts here without alot of commentary. 

The case was filed originally in California by residents of Taiwan but transferred by the multidistrict panel to the district court in Illinois with the other suits in the clotting-factor mass tort for pretrial proceedings.  The main tort claim was that the defendants acquired blood from "high-risk" donors, processed it improperly in California where they manufactured clotting factors, and after discovering that the factors were contaminated by HIV nevertheless continued to distribute the product in foreign countries (while withdrawing them from distribution in the United States). Thus, plaintiffs in this case, or the hemophiliac decedents whom they represented, in fact resided, and obtained and injected the clotting factor, in a foreign country.

The court addressed first the claims that were dismissed as untimely. The critical issue so far as these dismissals on the merits were concerned, said the court, was choice of law. When a diversity case is transferred by the multidistrict litigation panel, the law applied is that of the jurisdiction from which the case was transferred, in this case California. The California statutes of limitations don't begin to run until the plaintiff discovers, or should in the exercise of reasonable diligence have discovered, that he has a claim against the defendant.  But this discovery rule, even if applicable, would not save the plaintiffs' tort claims from dismissal for untimeliness. Plaintiffs argued that they didn't have enough information on which to base a suit until a New York Times article about the contamination of clotting factors with HIV was published on May 22, 2003, and therefore that their suit, filed in 2004, was timely.  But as the district court found, the plaintiffs had a reasonable basis to suspect that they had a cause of action more than five years before the article appeared, when their counsel actually had begun negotiations with two of the defendants to settle negligence claims arising from the alleged contamination of the defendants' clotting factors with HIV. (These negotiations culminated in the settlement in 1998 on which the plaintiffs' breach of contract claim was based.)

The plaintiffs argued that the limitations period should have been tolled by defendants' “fraudulent concealment” because when entering into the settlement agreement they claimed that they had done nothing wrong and that they were offering financial aid purely as a humanitarian gesture. The plaintiffs were mistaken in this. Denial of liability when negotiating a settlement agreement is the norm; it is not evidence of fraudulent concealment of anything.

The district court was also correct in ruling in the alternative that a California court would apply the Taiwanese 10-year statute of repose, because the plaintiffs' tort claims arose under Taiwanese law. The hemophiliacs whom the plaintiffs represented were infected in the 1980s, more than a decade before these suits were brought. If the plaintiffs' tort claims arose in Taiwan, California law makes the Taiwanese statute of repose applicable to those claims. The reason is California's “borrowing” statute, which is sensibly designed to discourage forum shopping, would bar the action in California if it would have been barred in Taiwan. The plaintiffs tried to argue that their claims arose in California, not Taiwan, because it was in California that the defendants allegedly failed to process their clotting factors in a way that would prevent contamination by HIV. But generally there is no tort without an injury. That is the rule in California.  And the injury alleged occurred in Taiwan.

Turning to the claims that the district court dismissed not as untimely but on the basis, rather, of forum non conveniens, the court noted that the contract was negotiated and signed in Taiwan.  The key language at issue, the so-called scale-up clause, was ambiguous.  Evidence beyond the language of the settlement agreement would be necessary to "disambiguate the clause," said the court, and it seemed that most of the persons who are in a position to give such evidence live in Taiwan, including the plaintiffs' Taiwanese counsel who negotiated the settlement, a Taiwanese patient representative, members of the Taiwanese department of health, defendants' Taiwanese outside counsel, and an employee of defendants in Taiwan.

Taiwanese law makes it difficult to gather evidence for use in a trial in a foreign country because Taiwan is not a party to the Convention on the Taking of Evidence Abroad in Civil or Commercial Matters; the alternative method of obtaining evidence in a foreign country, sending a letter rogatory to the foreign court, seemed to not be a very satisfactory means of obtaining evidence.  So this important factor pointed to Taiwan. The only circumstance that would favor holding the trial in California rather than in Taiwan would be the greater convenience for the defendants, since they are American companies. But as they didn't want the case to be tried in California, or indeed anywhere else in the United States, really there was nothing in favor of the American forum, said the court. When application of the doctrine of forum non conveniens would send the plaintiffs to their home court, the presumption in favor of giving plaintiffs their choice of court is little more than a tie breaker.  But, said the panel, "there is no tie here."

 

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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 Seventh Circuit issued a very interesting opinion on the interplay of class certification and Daubert issues. American Honda Motor Co., Inc. v. Allen, 2010 WL 1332781 (7th Cir., April 7, 2010).  Specifically, the defendant asked the court to resolve whether the district court  must conclusively rule on the admissibility of an expert opinion prior to class certification when that opinion is essential to the certification decision. Since this is the type of question that Rule 23(f) was designed to address, the court of appeals took the appeal -- and agreed with Honda. 

Plaintiffs were purchasers of Honda's Gold Wing GL1800 motorcycle; they alleged that the motorcycle has a design defect that prevents the adequate dampening of “wobble,” that is, side-to-side oscillation of the front steering assembly. Plaintiffs moved for class certification pursuant to Rule 23(b)(3). To demonstrate the predominance of common issues, they relied heavily on a report prepared by a motorcycle engineering expert, who opined about a "reasonable wobble decay" standard. Honda moved to strike the report pursuant to Daubert, arguing that this wobble decay standard was unreliable because it was not supported by empirical testing, was not developed through a recognized standard-setting procedure, was not generally accepted in the relevant scientific, technical, or professional community, and was not the product of independent research.

The district court said that it had "definite reservations" about the reliability of the expert's wobble decay standard. Nevertheless, the court declined to exclude the report in its entirety "at this early stage of the proceedings.”  The trial court denied Honda's motion to exclude “without prejudice,”  and granted plaintiffs' motion for class certification.

The 7th Circuit has already noted that a district judge may not duck hard questions by observing that each side has some support. Tough questions must be faced and squarely decided, if necessary by holding evidentiary hearings and choosing between competing perspectives. But the court had not yet specifically addressed whether a district court must resolve a Daubert challenge prior to ruling on class certification if the testimony challenged is integral to the plaintiffs' satisfaction of Rule 23' s requirements.  Here, it did hold that when an expert's report or testimony is critical to class certification, as it was in this case, a district court must conclusively rule on any challenge to the expert's qualifications or submissions prior to ruling on a class certification motion. That is, the district court must perform a full Daubert analysis before certifying the class if the situation warrants. If the challenge is to an individual's qualifications, a court must make that determination by comparing the area in which the witness has superior knowledge, skill, experience, or education with the subject matter of the witness's testimony. The court must also resolve any challenge to the reliability of information provided by an expert if that information is relevant to establishing any of the Rule 23 requirements for class certification.

Here, while the trial court began to ask the right questions, it never finished. The court's effective statement of admissibility left open the questions of what portions of the expert's testimony it may have decided (or will decide) to exclude, whether the expert reliably applied the standard to the facts of the case, and, ultimately, whether plaintiffs had actually satisfied Rule 23(b)(3)'s predominance requirement -- because they relied on the expert opinions. As a result, the district court never actually reached a conclusion about whether the expert report was reliable enough to support plaintiffs' class certification request.  This was not sufficient. Indeed, it was an abuse of discretion, according to the court of appeals.

The court went on to examine the record, which revealed to it that exclusion was the inescapable result when the Daubert analysis is carried to its conclusion. The expert originally developed the standard for use in a lawsuit in which he testified as an expert against Honda; despite its publication in one journal, there is no indication that this wobble decay standard had been generally accepted, or indeed, accepted by anyone other than this author. The expert never conducted any rider confidence studies to determine when motorcycle riders perceive wobble, or performed any tests to determine the minimal wobble amplitude at which riders detect oscillation.  He did test a single, used 2006 GL1800, ridden by a single test rider, but then extrapolated his conclusions to the entire fleet of GL1800s produced from 2001 to 2008 -- arguably too small a sample size from which reliable extrapolations can be made. 

The court therefore granted Honda's petition for leave to appeal, vacated the district court's denial of Honda's motion to strike and its order certifying a class, and remanded for proceedings consistent with this opinion.

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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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Readers of MassTortDefense interested in the issues surrounding medical monitoring will want to keep their eyes on Hess v. A.I. DuPont Hosp. For Children, 2009 WL 2776606 (E.D.Pa., August 28, 2009).  The court recently granted Defendants' Petition for Certification of Immediate Appeal (to the Third Circuit).

Doctors at the A.I. duPont Hospital for Children in Wilmington, Delaware, implanted a Cheatham Platinum stent (“CP stent”) in plaintiffs, who alleged that they had been injured or were at risk of injury from the use of the CP stent. After discovery, the trial court granted summary judgment to defendants on a number of the claims, but summary judgment was denied on Count VI, the medical monitoring claim. The trial court predicted that the Delaware Supreme Court would recognize a medical monitoring cause of action if presented with the facts of these cases.

The trial court recognized that there are substantial grounds for disagreement over whether Delaware will actually recognize a cause of action for medical monitoring. While Delaware courts, including the Delaware Supreme Court, have had medical monitoring claims before them on several occasions and have not totally disavowed medical monitoring as a legally cognizable cause of action, neither have they formally recognized the tort as a legally cognizable cause of action.  (In some jurisdictions it is a remedy, not a cause of action.)

Even if the Delaware Supreme Court were to recognize a medical monitoring tort, there are substantial grounds for disagreement over whether plaintiffs here could state a claim. Plaintiffs' theory that medical devices can be the basis for a medical monitoring claim is novel, at best  (and has been rejected in many states: Drugs and devices do not present the same policy issues as involuntary exposure to environmental toxins).   Indeed, there appear to be no cases precisely like this one in which a plaintiff has alleged and a court has recognized a medical monitoring claim where the plaintiff has had a Class III medical device implanted that did not have FDA premarket approval and where the plaintiff did not offer evidence that the device was defective. The court was satisfied that plaintiff's novel theory here is one in which certification of an interlocutory order for appeal is appropriate.

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