GOVERNMENT & LEGAL AFFAIRS
Because of the recent flourishing of tort reform in jurisdictions through the United States, the single-plaintiff personal injury suit has become less sustainable and far less lucrative. As a result, plaintiffs' personal injury lawyers have become more sophisticated, more aggressive, and above all more creative in their approach to product liability actions against industry. Attorneys of the plaintiffs' bar have launched a variety of new approachessome more successful than othersas they seek new ways to develop and sustain 'the next big thing' against drug and medical device companies.
Creative Class Building
In recent years, one of the biggest trends in product liability litigation has been the move away from single-plaintiff cases and toward the filing of large, statewide or nationwide purported class actions. The goal of this approach is to drive the claims into a large settlement with a substantial payout of attorneys' fees. The certification of a class of potential plaintiffs can transform a handful of innocuous or even unmeritorious complaints into substantial, bet-the-company litigation. Class actions are costly to defend and risky to take to trial, and thus typically result in settlement. The award to any single class member is usually minimal; however, the potential rewards to the law firms that engineer such class actions are huge.
Plaintiffs' lawyers often seek to build their classes early in the litigation by using the discovery process to ascertain the other consumers or patients affected by the product. Although FDA regulations may prohibit the disclosure of names and other identifying information of those who have reported adverse events associated with a recalled product, plaintiffs' lawyers often arrive at more creative means to obtain that information.1
For example, in a recent statewide class action over recalled allografts, a plaintiff sought early class discovery by filing an emergency motion seeking court supervision of the process of notifying customers of the recall.2 Despite FDA's extensive involvement and oversight of the recall process, the plaintiffs' counsel demanded that the trial judge intervene in the process to protect the public health against a "serious health risk."
The plaintiffs' counsel pushed for the court to structure a separate recall notification process directed at potential class members, even though this particular judge was but one of many judges presiding over numerous similar lawsuits around the country. Specifically, the plaintiffs' counsel wanted the court to order disclosure of the defendants' national customer and patient lists and to mandate the language that would be used in a nationwide recall notification.
The granting of such a motion would have meant that the plaintiffs' counsel, who had filed a statewide class action in a single venue, would have obtained early access to a national list of potential class members. From that, they could build lucrative national and other statewide class actions in favorable venues around the country. The court chose to order a temporary stay of the litigation until the lawsuit was transferred into multidistrict litigation, but the attempt illustrates the creativity and savvy being employed to orchestrate such class actions.
No-Injury and Consumer Protection Actions
In recent years, plaintiffs' counsel have made a practice of bundling low-injury or no-injury cases with a few cases where injury clearly occurred. The goal is to force settlement of the entire bundle through threats of punitive damages and runaway juries. In many jurisdictions there is a low threshold of proof for establishing the commonality and typicality required for class certification or bundling of such mass claims. This model, developed long ago in the asbestos litigation world, has appeared frequently in mass pharmaceutical and device litigation.
For example, millions of dollars were paid out to diet-drug plaintiffs who had questionable or even fraudulent claims, but who had been inextricably intertwined into cases brought by legitimate claimants. Many of the diet-drug claims were based on cursory readings at 'echo mills,' temporary echocardiogram facilities set up in hotel ballrooms and law offices and run by the lawyers. Judges caught on, and the most egregious of the plaintiffs' firms were chastised and their claims rejected after the court found highly objectionable conduct in their review and submission of potential drug cases.
Having been cautioned for pushing the bounds of legitimacy in this way, many plaintiffs' counsel are taking one of two new approaches: the no-injury or fear-of-injury class action, and the consumer protection class action. Savvy plaintiffs' lawyers have learned that it is often easier to obtain class certification or aggregation in no-injury or fear-of-injury cases because they do not have disparate diagnoses to impede the commonality requirement. Moreover, there is no need to locate injured plaintiffs; rather, anyone and everyone who has used the product or device can be in the class.
Unlike the mass torts of the pastsuch as those involving breast implants or latex gloves, where some injury was alleged due to use of the producttoday's hottest product litigation includes few actual reported injuries. The Medtronic implantable defibrillator litigation, for example, is largely based on the fear of complications rather than actual complications, and the litigation seeks recovery of costs associated with surgery needed to replace the recalled product.3
Similarly, the allograft litigation referenced above arose out of claims that several companies improperly harvested and screened human tissue used to make allografts, allegedly subjecting them to contamination prior to implantation in patients. The allografts at issue were recalled by FDA, thereby spawning the filing of purported class actions all over the country. The class actions make scant reference to any real injury and largely seek medical monitoring, continued medical screening of affected patients, and recovery for fear of contracting disease.
Along the same lines, consumer protection product liability class actions in the drug and device arena are all the rage. These cases typically involve the filing of product liability class actions based upon alleged violations of state consumer protection laws. One thing the plaintiffs' bar likes about bringing these types of claims is that attorneys can avoid having to overcome the scientific or causation hurdle, which is always one of the biggest battles in the mass tort wars.
Lipitor prescription drug litigation against Pfizer is one example.4 The Lipitor litigation is not injury based, but rather seeks monetary recovery on behalf of a class of Lipitor users, alleging that they and their doctors were led to take and prescribe the drug by deceptive advertising and false claims about the drug's efficacy.
Using Public Agencies
Plaintiffs' counsel are becoming more skilled at using regulatory agencies and public health authorities to identify their targets and to lay the framework for their suits. They scour FDA databases and state agencies for adverse-event reports and news of potential recalls. Once a product is recalled, plaintiffs' attorneys are almost certain to file lawsuits. Moreover, they work behind the scenes to spread public awareness, to encourage event reporting in large numbers, and to actually promote recalls of drugs and devices that appear to be good targets for the next mass or class action.
One of the first such examples occurred in the diet-drug litigation, which was engineered after a plaintiffs' lawyer read about the potential health affects in the New England Journal of Medicine and then aggressively campaigned for the recall of the involved drugs. In that case, the lawyers who had promoted the recall and fed the public frenzy were able to place their first print advertisement for plaintiffs on the day the recall was announced.
Similarly, plaintiffs' lawyers have learned to use the regulatory and public health authorities as a means to obtain discovery about their claims, including information and documents that might otherwise be privileged and confidential. They frequently encourage investigation by the Centers for Disease Control and Prevention (CDC; Atlanta), the state attorneys general, and the state and public health authorities, knowing that they will later be able to obtain information and documents from these bodies through a Freedom of Open Records Act request or its state equivalent.
Accordingly, when a manufacturer's product is subject to investigation or recall, it is important for the company to involve outside counsel as early as possible, so that every precaution can be taken to maintain confidentiality and privilege where appropriate.
Seeking Foreign Plaintiffs
Seeking new sources of plaintiffs for their class actions, plaintiffs' lawyers have turned to foreign users of drugs and devices and are filing more and more U.S. suits on behalf of their overseas clients. A number of recent cases involve actions by foreign plaintiffs against U.S. companies, and are seeking to recover for injuries suffered due to drugs or devices used in their home countries. Plaintiffs' counsel often argue, with varying success, that they should be allowed to litigate their foreign clients' claims in the United States when a U.S. regulatory agency such as FDA has supervised the recall.
Most recently, in the Vioxx litigation, a court dismissed class action claims against Merck & Co. brought by French and Italian plaintiffs in federal court. Merck sought dismissal of the claims on forum non conveniens grounds. In denying the claims, the court emphasized that the plaintiffs suffered and were treated in their home countries and that their home countries had approved the use of the product. The court found both France and Italy to be adequate and available alternative forums and held that the difficulties of trying the foreign plaintiffs' claims in the United States outweighed their interests in consolidating their claims with American plaintiffs.5 Although the claims were unsuccessful, the attempt illustrates yet another creative approach by the plaintiffs' bar to maximize the breadth of and damages from mass tort litigation.
Getting Cozy with the Media
Today's plaintiffs' counsel have become incredibly media savvy and know how to work the public relations angle to maximize their plaintiff numbers and influence potential jurors. Many plaintiffs' law firms even hire their own public relations consultants to help drive the daily news cycle in their favor. They have learned to feed documents or portions of documents, usually out of context, to their contacts at the media in order to build the story and fuel the frenzy. They frequently do so at the end of the day when there is no opportunity for the company to respond prior to the next news cycle.
In response, medtech companies have to be very nimble with their PR strategy when presented with potential litigation, investigations, or recalls. In many cases, it is advisable for a company to preempt the negative messages that will be fed to the media and beat plaintiffs' counsel to the punch by developing its own relationships with the media.
Even before the recall or the litigation hits, companies should have a crisis communication strategy in place. It is critical to involve counsel in the development of the company's crisis messaging so that efforts can be taken to preserve both the work-product protection and attorney-client privilege.
The Litigation Superhighway
Plaintiffs' counsel and their clients have become more 'wired.' The old standbys of television ads and phonebook advertising still exist, but these have been heavily supplanted by cheap and plentiful Internet advertising. Web sites such as www.lawyersandsettlements.com and www.productliabilitylawyer.com serve as virtual clearinghouses for lawyers and their prospective clients, and post daily listings for new lawsuits and FDA recalls. Would-be plaintiffs are now just a click away from legal representation on a menu of product liability actions, and have their own Web logs to chronicle their daily ailments and complaints.
In addition, personal injury lawyers network with one another in legal chat rooms, share litigation toolkits, and teach each other the tricks of the trade in online workshops focused on approaches to suing makers of pharmaceuticals and medical devices. The plaintiffs' litigation toolkits cover procedural topics such as preemption litigation and electronic discovery, and also include product-specific varieties such as the packets on Kugel mesh, heart device recalls, and Vioxx. Such litigation-in-a-box packets include sample complaints, discovery and other pleadings, client screening materials, FDA documents, and even exemplar medical records and suggested testimony.
When lawsuits are brewing or a recall is announced, affected patients who are hungry for information will turn to the Internet as the fastest and most comprehensive source of information. While plaintiffs' counsel have become adept at using the Internet to build and bolster their claims, defendants have not yet realized the full potential of the Internet for their benefit. Unfortunately, companies rarely use the Internet to share helpful communications, such as favorable studies, or to publicize their stories. Most medical device companies have attractive and informative Web sites for investors and clinicians, but unfortunately too few adequately utilize their Web sites as communication tools for potential claimants.
In this Internet age, companies should include appropriate customer communications on their Web sites to share information about the safety of their products, especially when in the midst of a recall or litigation. It is also important to ensure that the Web site is designed to show up as an early hit on Web searches rather than appearing pages behind a string of lawyer ads, patient Web logs, and negative press links.
Merck & Co. (Whitehouse Station, NJ) and Guidant-Boston Scientific (Natick, MA), two companies recently involved in highly publicized recalls, set up information centers on their Web sites where consumers could find specific information about the recall, instructions regarding the product, access to medical studies, and information about active or pending litigation. These companies also took the opportunity to include statements from their leadership, reaffirming their commitment to the public safety and the highest standards of customer service. By taking such an approach, companies can mitigate claims that they mishandled recall communications or misled the public.
When patients or consumers visit the company Web site for information about the recall, it should be an opportunity for companies to educate the individual about the product but also to present a more complete picture of the recall or the litigation and to clarify issues or unfavorable publicity. It is also imperative that attorneys are involved in the preparation of Web-based statements about potential litigation or recalls to ensure that inadvertent legal admissions are avoided.
Just as quickly as tort reform, legal rulings, and other barriers arise to impede tort lawyers, these lawyers are adapting in almost Darwinian fashion to develop creative new strategies and new means of sustaining product liability actions. They are using all means available to engineer 'the next big thing,' even before the media frenzy or recall happens, and in some cases are even prompting it.
In response, the medtech industry must anticipate this new creativity, take the initiative on communications, and be ready for battle long before the first suit is filed.
- Code of Federal Regulations, 21 CFR 20.63(f).
- Sunderman v. Regeneration Technologies Inc., no. 1:06-cv-00075 (S.D. Ohio April 24, 2006).
- In re Medtronic Inc. Implantable Defibrillators Prods. Liab. Litig., MDL no. 051726 JMR/AJB (D. Minn).
- Teamsters Local No. 35 Health Plans, Nancy Yost, Robert Martin, and Health Care For All v. Pfizer Inc. (D. Mass. 2005).
- In re Vioxx Prods. Liab. Litig., 448 F. Supp. 2d 741, 746-48 (E.D. La. 2006).
Victoria Davis Lockard is a partner in the law firm of Alston & Bird LLP (Atlanta), where her practice focuses on product liability litigation.