February 2008


ACL and BorgWarner were found liable in the mesothelioma death of a New Jersey man, according to Newsday.com.  Mesothelioma is a deadly form of cancer, caused only by exposure to asbestos.  The jury took 4 hours to return the $30.3 million verdict.  The victim in this case was Mark Buttitta, a 50 year old resident of New Jersey.  He was exposed to asbestos working in General Motors warehouses during summers.  His father also worked in the warehouses.  Witnesses testified that Mark Buttitta was exposed to asbestos when he was a child, when he sat in his father’s lap while his father was wearing his dusty work clothes. 

From Reuters, in a case captioned Riegel v. Medtronic, Inc., the Supreme Court has ruled in favor of a medical device manufacturer and in so ruling made Federal pre-emption the law of the land.  The court granted writs on the issue of “[w]hether the express preemption provision of the Medical Device Amendments to the Food, Drug, and Cosmetic Act, 21 U.S.C. § 360k(a), preempts state-law claims seeking damages for injuries caused by medical devices that received premarket approval from the Food and Drug Administration.”  The court answered the question in the affirmative.

This judicial tort reform, specifically the preemption doctrine, is something that has been on the way for quite some time.  It is the type of thing, the Federal government meddling in a state law issue, that conservatives claim to be against.  But when it comes to protecting drug manufacturers, things like ideology are thrown to the wayside.

Scalia wrote the majority opinion for the Court, which says the FDA’s premarket approval of a medical device preempts a claim brought under a state’s negligence law, in that negligence cannot be proven because the device has been cleared as safe for use by the FDA.  The FDA was given the authority to oversee approval of medical devices in a law passed by Congress in 1976.  The law did not say that FDA approval of a medical device precluded a state law negligence claim and did not purport to give medical device manufacturers blanket immunity from negligence suits.  A New York Times article states: two crucial figures in the passage of the original 1976 device law, Representative Henry Waxman, Democrat of California, and Senator Edward Kennedy, Democrat of Massachusetts, said Wednesday that the Riegel ruling was contrary to Congress’s intent and that they would introduce legislation to overturn it.

The medical device manufacturers provide much of the information that is used by the FDA to decide whether to approve a certain device.  If the manufacturer provides information that is favorable to their product, such as studies that show their device is safe, but fails to include harmful information, can you say that company should be immune from lawsuits.  This decisions will prevent plaintiffs’ lawyers from getting to the stage where they find out if this happened, because suits will be dismissed early in the game, before discovery has had a chance to proceed. 

The threat of lawsuits give medical device companies an incentive to do things the right way.  The threat prevents much harm.  Now that threat is gone. 

Justice Ginsberg cast the only dissenting vote and the story quotes the salient part of her dissent:  “Congress, in my view, did not intend (for the 1976 law) to effect a radical curtailment of state common-law suits seeking compensation for injuries caused by defectively designed or labeled medical devices”.

Judicial Tort Reform from the highest court in the land.  This decision impairs the right of injured individuals to seek justice through the legal system when someone negligently causes them harm.  Not what our judicial system was set up to do. 

According to a story in the Baton Rouge Advocate, the CDC has found unacceptable levels of toxic formaldehyde fumes in government FEMA trailers, issued to hurricane victims as housing on the Gulf Coast.  A study of FEMA trailers in Louisiana and Mississippi found exposure levels 40 times greater than the safe level in some trailers, and levels five times greater than those in a regular home in most trailers.  According to the New York Times, more than 35,000 of the trailers are still in use in the Gulf Coast region, and FEMA is moving forward with plans to house victims of last week’s tornados in Arkansas and Tennessee in the trailers. 

 CDC has advised that FEMA should move people out of the trailers as soon as possible, especially children, the elderly and those with respiratory problems.  People with  asthma could sustain breathing problems and burning eyes from the exposures, as well as severe asthma attacks.  Formaldehyde has also been tagged as a probable carcinogen.  Common difficulties associated with formaldehyde exposure include headaches, coughing, wheezing, and a burning throat.  Formaldehyde can also cause allergies.

UPDATE:  FEMA’s goal is to have 35,000 Gulf Coast residents out of FEMA trailers by the summer of 2008, according to FEMA administrtor R. Daivd Paulison.  Ambitious goal for an agency that has been so inept at dealing with problems in the past.  Lets hope for the best.

According to a story in the Oklahoman, a jury in Oklahoma City awarded a woamn $10.8 million, for her bad faith claim on an American Fidelity cancer policy her son purchased.  Dolores Metger’s son, Michael Metzger, purchsed a cancer policy with American Fidelity in 1992.  The policy was to cover medical expenses in the event Michael was ever diagnosed with cancer.  In November 2004 Michael was diagnosed with cancer.  Michael passed away on January 4, 2005. 

When the expenses were submitted to the insurance company, they refused to pay the amount of actual medical expenses, claiming they should only pay the amount paid by Michael’s insurance company.  American Fidelity’s policy in 1992, when Michael purchsed his cancer policy, was to pay actual medical expenses, the amount the patient was billed, not the amount the medical insurer paid.  American Fidelity claimed they changed this policy in 1994 and only were responsible for the discounted health insurer amount. 

American Fidelity heavily marketed these cancer policies to teachers in Oklahoma.  Michael Metzger was an economist at the University of Central Oklahoma.  Speaking about Mrs. Metger, her attorney Tony Gould said “This was never about the money to her, she just wanted justice for Oklahoma educators.”   

Tort reformers regularly claim that an elected judiciary leads to an out of control judicial system and unfair results.  They claim that if judges were appointed by policticians, rather than elected by the people, the judiciary would somehow be more fair.  The argument is really a ploy by those in power, business and insurance interests, to take the power to elect judges out of the hands of normal working people.  Appointing judges puts the power into the hands of the politicians that big business interests have donated a lot of money to.  There is only one person voting when judges are appointed. 

The power we are talking about is basically the power of an entire branch of government, one-third of our tri-partite system, the judiciary.  The advantage judicial appointments hold over elections, is that big business can whisper the judge’s name into the ear of the politician with the power to appoint, and that judge is elected to the bench.  The public has no power in the process.  Unlike elections, which are transparent and provide a forum to discuss the qualifications and ideas of the candidates – appointed judges aren’t scrutinized by the public.   

KSTP in Minnisota reports there is a current push in Minnesota to switch to appointment of judges.  According to a report from the Herald-Dispatch the West Virginia Chamber of Commerce is pushing the measure in West Virginia – appointment of judges has already been debated in the legislature.  West Virginia has been on the US Chamber of Commerce/ATRA’s list of judicial hellholes for a while.  Obviously the bullying by these groups is working. 

Appointment of judicial officials appears to be one of the main areas of focus for tort reformers this year.  I’m sure there will be more to report on this issue.

According to a story in the New York Times, drug maker Eil Liy, is negotiating with federal and state agencies to settle federal and state civil and criminal penalties regarding the marketing practices it employed for its anti-psychotic drug.  Zyprexa gained FDA approval for treatment of people with schizophrenia and sever bipolar disorder.  Evidence shows that Eil Lily marketed the drugs to doctors for other uses, including in people with age related dementia.  Doctor are allowed to use drugs for off label purposes, but drug companies are not allowed to promote these uses.  This fine would be the largeset one of its kind, if approved.

Eli Lily has already paid $1.2 Billion to settle lawsuits claiming Zyprexa causes diabetes in some who take it. 

Public Citizen, a consumer watchdog group has issued a press release criticizing the CPSC and calling for Congressional action on the problem.  The group claims the CPSC waits months to tell consumers about hazardous and dangerous products.  This is the text of the press release:

Recalls of Hazardous Goods Often Take More Than Three Years to Begin

WASHINGTON, D.C. – Despite a law requiring manufacturers to provide the Consumer Product Safety Commission (CPSC) with “immediate” notification of dangerous products, the agency typically delays nearly seven months after learning of dangerous, defective products before telling the public, a Public Citizen study of CPSC settlements published in the Federal Register reveals.

The study, “Hazardous Waits: CPSC Lets Crucial Time Pass Before Warning Public About Dangerous Products,” covers 46 cases since 2002 in which the CPSC fined manufacturers for failing to adhere to the law requiring prompt reporting. In addition, companies fined for tardy reporting took an average of 993 days – 2.7 years – between learning of a safety defect in their products and notifying the CPSC. Because the agency publishes information about only those settlement agreements in which penalties are imposed, details about other delays and recalls are not publicly available.

Perhaps as shocking, the CPSC then took an average of 209 additional days before disclosing the information to the public – even though each case concerned a product defect so dangerous that the item was recalled. Under current law, the CPSC cannot disclose information about dangerous products without court approval or manufacturer agreement.

The products included coffee makers and vacuum cleaners prone to catching fire, treadmills that spontaneously accelerated to an Olympic miler’s pace, all-terrain vehicles with throttles that became stuck in the “go” position, bicycles with forks that could break under normal use, and infant swings that could cause strangulation and were implicated in the deaths of six infants.

“There’s no excuse for manufacturers waiting nearly three years before telling the CPSC about a defective product that can kill people – or for the CPSC taking another seven months to negotiate a recall and warn the public,” said Joan Claybrook, Public Citizen president. “Manufacturers now have the power to hamstring the agency. Given these inordinate delays, the law must be changed to allow the agency to inform consumers and give it enough money, authority and enforcement muscle.”

Details of the settlement agreements reveal that manufacturers have taken a cavalier attitude toward the disclosure law. In addition to failing to notify the CPSC of safety defects – often after receiving hundreds of notices from their customers – many manufacturers withheld key details from the agency when they finally did file. These details included customer complaints about products, efforts to redesign products to resolve design flaws and information about the death of a consumer.

Although the CPSC fined manufacturers for late reporting, the agency itself was slow in providing the same information to the public. For example, the agency received a report in February 2001 about an all-terrain vehicle with an oil line subject to disconnecting and spewing steaming oil on its driver and surroundings. The defect was eventually blamed for injuring 18 people, some with serious burns, and causing 42 fires. But the CPSC did not tell consumers until April 2003 – more than two years after the manufacturer informed it of the hazard.

One major cause of delay is the manufacturers’ ability to sue the agency to block public disclosure of information about hazards. The mere threat of lawsuits deters the agency from acting.

“It is ridiculous that the CPSC has to obtain manufacturers’ consent before informing the public about hazardous products,” said David Arkush, director of Public Citizen’s Congress Watch division.    “The nation’s product safety agency shouldn’t have to ask for permission to do its job. The law must be changed.”

Among Public Citizen’s findings:

  • Graco waited 11 years to report its faulty infant swing, which was linked to reports of 181 falls that resulted in six deaths and nine serious injuries, including bone fractures and concussions. Graco made the report only after CPSC staff contacted the company.
  • Hoover waited five years to report a vacuum cleaner with a faulty switch that had caused at least 96 fires. The CPSC then took another 279 days before negotiating a recall and informing the public.
  • By February 2000, Polaris Industries had received 1,147 reports of faulty oil lines on its ATV, including 42 instances where the hot oil started a fire and 18 cases in which the oil seriously burned a rider. But the company didn’t report the defect to the CPSC for another year.

The CPSC relies on prompt and thorough reporting by manufacturers because the agency conducts little independent testing and inspects few products. Public Citizen’s findings illustrate the need for Congress to give the agency more authority and resources. In crafting legislation to reauthorize the CPSC, which is currently under negotiation in Congress, lawmakers should:

  • Provide the CPSC with the freedom to inform the public about risks promptly. Currently, the CPSC cannot act unilaterally to inform the public about hazards without risking lawsuits by manufacturers. Congress should give the agency the ability to provide critical information to the public without undue interference and delays by industry.
  • Grant authority to levy higher fines and seek effective criminal penalties. The CPSC’s current cap on civil penalties of $1.8 million per violation of reporting requirements is a pittance compared to the cost of conducting recalls. This gives companies an incentive to leave the agency in the dark about defects. Congress should eliminate the cap or raise it to at least $100 million per violation.
  • Provide the CPSC with a significantly larger budget and staff. The agency received a meager $63 million in 2007 to protect the public from dangers posed by millions of products. Congress should boost it to at least $150 million.
  • Give state attorneys general broader enforcement powers. A major criticism of the CPSC is its failure to enforce the law effectively. Congress should allow state attorneys general to enforce the law and give them authority to seek all of the remedies available to the CPSC.