Category: Product Liability

FDA Denies Citizen Petition’s Request to Ban Marketing of Non-Absorbable Surgical Mesh Products for Transvaginal Repair of Pelvic Organ Prolapse

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On July 14, 2014, FDA publicly posted its response denying Public Citizen’s August 2011 citizen petition concerning the marketing of non-absorbable surgical mesh products for transvaginal repair of pelvic organ prolapse (POP).  In its response, FDA took the position that a ban or recall of POP devices is not warranted at this time.

As background, in August 2011, Public Citizen filed a citizen petition asserting that POP devices “offer no clinically significant benefits in comparison to surgical repairs for POP performed without placement of surgical mesh” and “have high rates of serious complications.”  Public Citizen requested that the agency take the following actions: (1) ban the marketing of all available non-absorbable surgical mesh products for transvaginal repair of POP; (2) order all manufacturers to recall these products; and (3) classify all new non-absorbable surgical mesh products for transvaginal repair of POP as class III devices and approve the products only under a premarket approval application (PMA).

In its response, dated May 1, 2014, FDA denied the citizen petition.  While the agency rejected Public Citizen’s call for a ban or recall of POP devices, FDA noted that it shares some of the concerns outlined in the citizen petition and is taking actions to address these concerns.  In addition, the agency also determined that “a citizen petition is not the appropriate mechanism for requesting a reclassification of a device.”

FDA explained that in September 2011, the agency convened an advisory committee meeting of the Obstetrics and Gynecology Devices Panel to discuss the safety and efficacy of transvaginal surgical mesh products used for repair of POP.  The Panel determined that “a favorable benefit-risk profile” for these devices “had not been well-established” and that the devices should be reclassified from class II to class III.  The Panel also recommended that manufacturers conduct postmarket studies of currently marketed surgical mesh products for transvaginal repair of POP.  As of May 2014, FDA had issued 126 postmarket surveillance orders to 33 manufacturers of these devices.

FDA explained that it has evaluated information from the Panel’s recommendations and the published scientific literature and has tentatively determined that the device should be reclassified as a class III device.  On May 1, 2014, FDA published a proposed order in the Federal Register to reclassify surgical mesh for transvaginal repair of POP from class II to class III.  On the same day, FDA published another proposed order in the Federal Register to require the filing of a PMA following the reclassification of the device to class III.  Thus, although FDA did not grant Public Citizen’s third request, the agency “initiated the process that could ultimately result” in reclassification of the device and the requirement to submit a PMA for these devices.

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Colleen Kelly
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Covington & Burling LLP

California Announces Initial Draft Priority Products Under California Safer Consumer Products Regulations

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On March 13, 2014, the California Department of Toxic Substances Control (“DTSC”) announced the first set of draft priority products that, if finalized, will be subject to the requirements of the California Safer Consumer Products (“SCP”) Regulations.

Notably, while DTSC had legal authority to identify up to five products, it chose to identify only three draft priority products at this time. The three products are:

  1. Children’s Foam Padded Sleeping Products containing the flame-retardant chemical, Tris (1,3-dichloro-2-propyl phosphate) or (“TDCCP”). Such products include nap mats and cots, travel beds, bassinet foam, portable crib mattresses, play pens, and other children’s sleeping products. In its press release announcing the draft priority products, DTSC asserted that TDCCP is a known carcinogen, is released from products into air and dust where it can be absorbed, inhaled, or transferred from hand to mouth, and has been found in California waters and sediments. DTSC also noted that there is no legal requirement applicable to these products that would require them to be made with flame retardants. For more information on DTSC’s selection of this draft priority product, click here.
  2. Spray Polyurethane Foam (“SPF”) Products containing Unreacted Diisocyanates. SPF products are used for home and building insulation, weatherizing and sealing, and roofing. DTSC asserted in its press release that exposure to wet or “uncured” SPF materials can contribute to occupational asthma and noted that unreacted diisocyanates are a “suspected” carcinogen. DTSC expressed its concern for populations using these products that are not protected by Occupational Safety & Health Administration regulations, such as independent contractors and people performing their own home repairs. In its press release, DTSC noted that currently there are no alternatives to unreacted diisocyanates for spray-foam applications. For additional information from DTSC on this draft priority product, click here.
  3. Paint and Varnish Strippers containing Methylene Chloride. Methylene chloride is a well-known and widely used solvent in paint strippers. According to DTSC, when metabolized, methylene chloride converts to carbon monoxide, which is acutely toxic to the brain and nervous system. DTSC claimed that alternative products without methylene chloride are readily available. For more information on this draft listing, click here.

In announcing the “draft list” of proposed priority products, DTSC emphasized that the naming of these products does not constitute a ban on the products, but rather the initiation of process to examine whether the chemicals of concern used in these products are “necessary” or may be replaced with safer alternatives. To put the draft priority products announcement in context, this announcement begins the second of four steps established by California’s SCP Regulations for identifying, prioritizing, and evaluating the use of chemicals and their alternatives in consumer products. The four steps include:

  1. Identification of Candidate Chemicals. The final SCP Regulations promulgated by DTSC include an initial list of candidate chemicals (~1,200), which DTSC later pared down to an informational “initial” list of fewer than 200 candidate chemicals that exhibit a hazard trait and/or environmental or toxicological endpoint.
  2. Identification of Priority Products. The SCP Regulations require DTSC to evaluate and prioritize product/candidate chemical combinations and to develop a list of priority products for which alternatives analyses must be conducted. Once a candidate chemical is the basis for a priority product listing, it is considered a chemical of concern. March 13’s announcement identifies the first product/candidate chemical combinations that DTSC is proposing to subject to the procedural process outlined in the SCP Regulations.
  3. Alternatives Analysis. Responsible entities of a product listed as a priority product must perform an alternatives analysis to determine how best to limit exposures to, or the level of adverse public health and environmental impacts posed by, the chemicals of concern in the product.
  4. DTSC Regulatory Response. The SCP Regulations provide a range of potential regulatory responses that DTSC may require after review of the alternatives analysis. These include provision of information for consumers (such as safe handling or instructions to limit exposure), restrictions on the use of chemicals of concern in the products, sales prohibition, engineered safety measures, and end-of-life management requirements. DTSC may require regulatory responses for a priority product (if the responsible entity decides to continue producing and distributing the priority product to the California market), or for an alternative product selected to replace the priority product.

Applicability

The SCP regulatory requirements apply to businesses (“responsible entities”) that manufacture, import, distribute, sell or assemble consumer products[1] identified by DTSC as priority products that are placed into the stream of commerce in California. Responsible entities are defined to include manufacturers, importers, retailers and assemblers. The SCP Regulations assign the principal duty to comply with the requirements to manufacturers. If a manufacturer does not comply with its obligations with regard to a priority product, DTSC may notify an importer, retailer or assembler of its duty to meet the requirements with respect to the priority product. Even if not called on to conduct an alternatives analysis, importers, assemblers and/or retailers of priority products may be impacted by regulatory responses selected by DTSC after the manufacturer’s completion of the alternatives analysis (e.g., if DTSC imposes a sales prohibition or requires additional information to be provided to the consumer at the point of sale) .

Requirements for Responsible Entities

Once the draft priority products are formally proposed and finalized through a public rulemaking process (which may take up to one year), responsible entities will be required to:

  • Within 60 days after finalization of the final priority products list, notify DTSC that the responsible entity makes or sells a priority product (DTSC will post information obtained from notifications, including the names of the responsible entities as well as the product names, on its web site);
  • Within 180 days after finalization of the final priority products list, prepare a Preliminary Alternatives Analysis[2] to determine how best to limit exposures to, or the level of adverse public health and environmental impacts posed by, the chemicals of concern in the product; and
  • Within one year after DTSC issues a Notice of Compliance for the Preliminary Alternatives Analysis, prepare a Final Alternatives Analysis.

Next Steps

Those that manufacture, sell, use, or otherwise have an interest in the draft priority products may wish to submit comments to DTSC as part of the priority product listing process. DTSC will follow a formal rulemaking process to finalize the draft priority products, which will take up to a year after the products are formally proposed. DTSC plans to hold several workshops in May and June of 2014 before publishing the notice of proposed rulemaking and opening the public comment period. Stakeholders will then have the opportunity to weigh in on whether, and how, the proposed priority products will be regulated by DTSC.

If your products were not among the three proposed priority products,stay tuned: By October 1, 2014, DTSC is required to issue a Priority Product Work Plan that identifies and describes the product categories that DTSC will evaluate to select priority products for the three years following the issuance of the Work Plan (roughly from 2015 to 2017). DTSC intends the Work Plan to serve as a signal to consumers and the regulated community as to the categories of products it will examine next.

Once DTSC finalizes the initial priority product listings (anticipated late summer or early fall of 2015), responsible entities will be required to meet a series of deadlines for notification and submission of alternatives analysis reports outlined above. Manufacturers of draft priority products should engage their supply chain partners to evaluate options prior to finalization of the priority product listings. Note that manufacturers that choose to reformulate products prior to finalization of the priority product listing will not be subject to the DTSC notification or alternatives analysis requirements.

[1] “Consumer product” is defined for purposes of the California Safer Consumer Products regulations to mean “a product or part of the product that is used, brought, or leased for use by a person for any purposes.” Cal. Health & Safety Code § 25251(e). Certain limited products, such as dental restorative material or its packaging, prescription drugs or devices and their packaging, medical devices and their packaging, food, and federally registered pesticides, and mercury containing lights are excluded from the definition of consumer product.

[2] DTSC is currently developing an alternatives analysis guidance document to assist responsible entities in carrying out their obligations under the SCP Regulations. As of March 13, 2014, the guidance is still in development. DTSC anticipates that it will be released sometime before the first set of priority products is finalized.

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What Does The Word “Natural” Mean, Anyway?

Mintz Logot’s 2 o’clock in the afternoon, you need a snack – maybe a granola bar, but which one? Does the package that boasts it is “100% Natural” win out over the one that is only “All Natural”?  Would you even consider one that is merely “Natural”? Well, don’t expect the U.S. Food and Drug Administration to help you decide anytime soon – they have left it up to the courts to grapple with.

Lawsuits against food companies alleging consumer fraud based on deceptive labeling have increased in the last few years.  Many of these lawsuits have been brought in the U.S. District Court in the Northern District of California, causing that court to be known as the “Food Court” (no, not the one at the mall).  One common bone of contention is the use of the word “natural” in food labeling.  “Natural” remains undefined by the U.S. Food and Drug Administration after a failed attempt to do so in 1991.  It reaffirmed its informal policy for use of the word “natural” on food labeling claims:

The agency will maintain its current policy . . . not to restrict the use of the term “natural” except for added color, synthetic substances, and flavors as provided in [21 CFR] §101.22.  Additionally, the agency will maintain its policy . . . regarding the use of “natural,” as meaning that nothing artificial or synthetic (including all color additives regardless of source) has been included in, or has been added to, a food that would not normally be expected to be in the food.  Further, at this time the agency will continue to distinguish between natural and artificial flavors as outlined in §101.22. See more here.

A typical claim in a lawsuit will contend that the use of the word “natural,” whether as “100% Natural,” “All Natural,” or something similar, is misleading if the product contains or was processed with a compound perceived by plaintiffs to be artificial or synthetic.  The problem in these lawsuits is that the term is undefined, and even FDA says that it is difficult to define a food product that is natural because it has likely been processed and is no longer a “product of the earth.”  This leaves fertile ground for plaintiff’s class action attorneys to bring claims against food companies for any use of the word.

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Second Circuit Certifies Smoking-Related Medical Monitoring Issue for Ruling by New York High Court

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In an effort to clarify the availability and scope of medical monitoring claims under New York law, the Second Circuit last week certified to the New York State Court of Appeals questions relating to whether smokers who have not been diagnosed with a smoking-related disease may bring a stand-alone claim against a tobacco company for medical monitoring. The Court of Appeals’ decision will likely have broad implications for toxic tort cases involving allegations of potential health effects.

The action was brought by long-term smokers who had not contracted lung cancer. They alleged that Defendant Philip Morris USA, Inc. knew that it was feasible to develop a less carcinogenic cigarette, but deliberately designed its product to deliver an excessive amount of carcinogens when smoked. As relief for their claims of negligence, strict liability and breach of warranty, the plaintiffs sought funding for a medical monitoring program to address their increased risk of lung cancer.

The Second Circuit affirmed Defendant’s motion to dismiss the smokers’ claims of negligence, strict liability and breach-of-warranty claims. Rather than dismiss the request for medical monitoring outright, however, the Circuit judges asked the Court of Appeals to consider whether, under New York law, a current or former heavy smoker not diagnosed with smoking-related disease may pursue an independent equitable cause of action for medical monitoring for such a disease. If the court determines that an independent cause of action for medical monitoring exists, the Second Circuit asked the court to then consider what the elements of that cause of action would be, what statute of limitations would apply, and when the cause of action would begin to accrue.

Although several New York courts have allowed medical monitoring damages as a remedy in connection with other claims, the Second Circuit noted that no New York court has directly addressed the questions it certified, and invited the Court of Appeals to expand on or alter those questions as it sees fit. Regardless of the result reached by the Court of Appeals, its decision in this matter will likely have far-reaching effects on the availability and scope of medical monitoring claims and remedies under New York law.

Abbott’s $1.6 Billion Settlement Stands as Cautionary Tale to Pharma Companies

The National Law Review recently published an article by David Deitch of Ifrah Law regarding Abbott’s Recent Settlement:

A recent settlement by global pharmaceutical giant Abbott Laboratories over its promotion of the drug Depakote shows that federal regulators remain prepared to pursue drug manufacturers for promoting unapproved uses of their products. Abbott has agreed to pay federal and state governments a total of $1.6 billion in criminal and civil fines and to plead guilty to a criminal misdemeanor violation of the Food and Drug Act to resolve allegations against it. This makes the case the second-largest in a series of multi-million dollar settlements of enforcement actions by the U.S. Department of Justice and state regulators against drug makers. Abbott will be subject to monitoring and reporting requirements as a condition of its plea.

When the Food and Drug Administration approves a drug as “safe and effective” for sale to the public, it specifies that the approval is for one or more defined medical purposes. It is a common practice among doctors, however, to prescribe drugs for other uses based on their understanding of other effects of use of the drug, and such “off label” prescriptions are not illegal.It is illegal, however, for drug manufacturers to promote off-label use of their products.

In the Abbott case, federal and state regulators and law enforcement agencies alleged that the company had promoted off-label use of Depakote, which the FDA has approved to treat epileptic seizures, migraines and the manic episodes suffered by people with bipolar disorder. As part of its settlement, Abbott has admitted that, beginning in 1998, it trained a portion of its sales force to promote Depakote to nursing home personnel as a way to control agitation and aggression in elderly patients suffering from dementia. Abbott continued to do so through 2006 even after it was forced to discontinue clinical trial testing in 1999 of the use of Depakote to treat patients with dementia because the drug caused increased drowsiness, dehydration and anorexia in the elderly test subjects.

The use of Depakote by nursing homes for the off-label use promoted by Abbott was attractive because, as Abbott’s sales force highlighted, Depakote was not covered by the Omnibus Budget Reconciliation Act of 1987 (OBRA) and its implementing regulations designed to prevent the use of unnecessary medications in nursing homes. Thus, use of the drug for this purpose could help nursing homes avoid the administrative costs and other burdens of complying with that law.

In some ways, the Abbott settlement is simply another reminder that pharmaceutical manufacturers that “misbrand” drugs by promoting off-label use will face scrutiny and enforcement from federal and state governments. On the other hand, the Abbott case is particularly egregious given the allegations that, after tests showed poor effectiveness and possible problems with the off-label use of Depakote, Abbott failed to disclose to its sales force the results of those studies. In highly regulated industries such as pharmaceutical manufacturing, the case is a reminder that companies that fail to adhere closely to legal and regulatory requirements do so at great risk.

© 2012 Ifrah PLLC

Pennsylvania Adopts Significant Tort Reform Eliminating Joint and Several Liability: Fair Share Act Signed into Law

The National Law Review recently published an article by Meredith N. Reinhardt of Drinker Biddle & Reath LLP regarding Tort Law Reform in Pennsylvania:

In our June 2011 Newsletter, we discussed the status of important pending legislation in Pennsylvania (the Fair Share Act) designed to eradicate the common law doctrine of joint and several liability.  As of the date of that article, the Pennsylvania House of Representatives approved the Fair Share Act (H.B. 1), and the Act was before the Pennsylvania Senate for consideration.  After extensive debate, the Senate ultimately approved a bill substantively identical to H.B. 1.

On June 28, 2011, Governor Tom Corbett signed the Fair Share Act into law, effective immediately.  The Fair Share Act, (42 Pa. Cons. Stat. § 7102), provides for proportionate share liability among joint tortfeasors and eliminates the common law doctrine of joint and several liability in all but a few limited situations.  Under the new law, each defendant is liable for “that proportion of the total dollar amount awarded as damages in the ratio of the amount of that defendant’s liability to the amount of liability attributed to all defendants and other persons to whom liability is apportioned under subsection (a.2).”  42 Pa. Cons. Stat. § 7102(a.1)(1).  Joint and several liability still applies where there is an intentional misrepresentation, an intentional tort, a claim under section 702 of the Hazardous Sites Cleanup Act, a violation of section 497 of the Liquor Code or where a defendant is liable for 60% or greater of the total liability apportioned to all parties.  42 Pa. Cons. Stat. § 7102(a.1)(3).

The Fair Share Act is a significant victory for product manufacturers, insurance companies and other businesses who are often hauled into litigation because of their “deep pockets” even if they might be only minimally liable.  Reactions from these groups has been overwhelmingly positive.  Pennsylvania Chamber of Business and Industry Vice President Gene Barr commented that the Fair Share Act “restores fairness and predictability to the state’s legal system, encouraging business investment and job growth.”1 The Chairman of the Insurance Agents & Brokers of Pennsylvania further praised the new law:  “The act is a win for consumers, businesses and the insurance industry, which all carry the financial burdens of such a litigious environment.”2

Conclusion

As a practical matter, passage of the Fair Share Act will likely decrease the frequency “deep pocket” defendants with minimal liability are brought into litigation.  Even if such defendants are joined in litigation, the Fair Share Act will reduce the possibility of inequitable judgments.  As time passes, product manufacturers, insurance companies and other business who are often co-defendants in various litigations will continue to see the benefits of this significant tort reform.

 

1 Press Release, Gov. Corbett signs Chamber members’ No. 1 lawsuit abuse reform priority (June 28, 2011) (on file with author and available at: http://www.pachamber.org/www/news/press_releases/2011/Gov%20Corbett%20signs%20Chamber%20members%20No%201%20lawsuit%20abuse%20reform%20priority.php)

 

2 Press Release, IA&B applauds Pennsylvania lawsuit-abuse reform (June 28, 2011) (on file with author and available at:  http://www.iabgroup.com/press_center/releases/2011/06_28_tort_reform.html).


©2012 Drinker Biddle & Reath LLP

Otsuka v. Sandoz – Motivation Trumps Structure

An article by Warren Woessner of Schwegman, Lundberg & Woessner, P.A. about Otsuka v. Sandoz recently appeared in The National Law Review:

The recent decision of the Fed. Cir. in Otsuka v. Sandoz, App. No. 2011-1126, -1127 (Fed. Cir. May 7, 2012) continues the courts admirable work in defining obviousness post-KSR. This case revisits the standards involved in making out a prima-facie case of structural obviousness. What is particularly interesting in this decision is the weight – or lack thereof – that the court gave to evidence of therapeutic utility of the closest prior art compound. In fact, the court applied the fairly obscure maxim of patent law articulated forty years ago In re Steminski, 444 F.2d 581 (CCPA 1971). John L. White, in Chemical Patent Practice, summarized the holding of Steminski as part of his discussion of the “Hass-Henze Doctrine”:

“The [CCPA] concluded that because the characteristics normally possessed by members of a homologous series [e.g., differing by only one methylene group] are principally the same, varying gradually from member to member [e.g., methyl, ethyl, propyl, butyl, etc], chemists knowing the properties of one member of a series would in general know what to expect in adjacent members so that a mere difference in degree is not the marked superiority which will ordinarily remove the unpatentability of adjacent homologs of old substances. Contra, where no use for the prior art compound is known [citing Steminski].”

Sandoz was trying to invalidate an anti-schizophrenic drug, aripiprazole, marketed by Otsuka as Abilify. The court abbreviated its structure by referring to it as a 2,3-dichlorophenylbutoxy compound. Sandoz et al. were trying to invalidate the claim to this compound in US Pat No. 5,006,528 over an earlier patent that disclosed the 2,3-dicholorphenylpropoxy analog of Abilify (a butoxy compound). Not only is the prior art compound  a homolog of Abilify, but the prior art patent disclosed a laundry list of utilities, including “antischizophrenia agents”. Many other structurally more remote analogs were disclosed, and three others were discussed in detail in the opinion, but the appellant/defendants must have felt pretty confident, even though the district court ruled that the patent was unobvious.

No such luck! The Fed. Cir. discussed the “lead compound concept” at length and stated that: “Absent a reason or motivation based on such prior art evidence [of pertinent properties], mere structural similarity between a prior art  compound and the claimed compound does not inform the lead compound selection….See KSR [citation omitted] (‘A fact finder should be aware, of course, of the distortion caused by hindsight bias and must be cautious of arguments reliant upon ex post reasoning.’)” Slip op. at 18-19. In other words, structural similarity, taken alone is not sufficient to establish obviousness.

But wasn’t there data beyond the “naked” structure of the 2.3-dichlorophenyl propoxy prior art homolog? Citing Takeda, 492 F.3d at 1357 and Pfizer, 480 F.3d at 1361, the court fell back on the rule that the art worker must be motivated to use the teachings of the reference to achieve the claimed invention and had a reasonable expectation of success. The court focused on the generality of the prior art disclosure of utility and the primitive nature of this area of pharmacology prior to Otsuka’s invention of Abilify: “At the relevant time, there were no carbostyril compounds that were marketed as antipsychotics or were publicly known to have potent antipsychotic activity with minimal side effects.”So reasonable expectation of success probably carried the day (or the lack thereof), and the ‘528 patent remains valid. Apart from the revival of Steminski, I was heartened by the number of times that the court criticized defendants’ use of what the court(s) considered to be hindsight. For instance, defendants tried to argue that Otsuka’s advance involved “a short timeline”. The Fed. Cir. replied:

“The inventor’s own path itself never leads to a conclusion of obviousness; that is hindsight. What matters is the path the [POSA] would have followed, as evidenced by the pertinent prior art…the district court’s careful analysis exposed the Defendants’ obviousness case for what it was—a poster child for impermissible hindsight reasoning.”

Not just pretty words, beautiful ones!

© 2012 Schwegman, Lundberg & Woessner, P.A.

The "Safer Products" Database: Reports of Harm Made Public on March 11, 2011

Posted last week at the National Law Review by Mary C. Turke of Michael Best & Friedrich LLP – updated information on the U.S. Consumer Product Safety Commission’s Publicly Available Consumer Product Safety Information Database which is set to officially launch March 11, 2011: 

The U.S. Consumer Product Safety Commission’s Publicly Available Consumer Product Safety Information Database (the “Database”) (found atwww.saferproducts.gov) will be launched officially on March 11, 2011. Mandated by the Consumer Product Safety Improvement Act of 2008 (the “Act”), the Database includes a new mechanism for consumers to report harm, or merely a risk of harm, involving consumer products (excluding food and drugs). The Database makes qualified reports of harm available to the public, in an online, searchable format. Prior to publication of any report, the Commission will allow manufacturers to comment and/or challenge reports containing materially inaccurate or confidential information. In certain cases, manufacturers’ comments may be published as well. Previously, reports of harm and responsive comments were not available to the public unless published in a Commission report or obtained through a Freedom of Information Act request.

The Database is currently in “soft-launch” i.e., the Commission and stakeholders are testing the new reporting and response system with the knowledge that until March 11, 2011, nothing will be made publicly available in the Database. Indeed, consumer reports are being accepted through the website and any report meeting minimum requirements for publication are transmitted to registered manufacturers, importers and private labelers. These companies are able to provide comments online and challenge reports as containing inaccurate or confidential information.

This practice time is valuable, particularly because the faster a company is able to respond to a negative consumer report, the better. Companies should use the soft-launch to establish protocols for dealing with reports of harm involving their products, including designating persons within the company to be notified of reports via email and identifying the single account holder who is allowed to submit comments. The Act does not require that reports be based on first-hand knowledge or that they be made within a certain time following the alleged harm. Thus, companies should carefully review all reports in which they are named and consider monitoring reports in the Database by industry — where no manufacturer is named. Perhaps most importantly, companies should develop procedures for responding to reports that contain materially inaccurate or confidential information. The Act requires that any request to remove information from a report be “timely” and accompanied by a certification to defend the Commission if the removal is later challenged. Thus, companies must be prepared to act quickly and accurately in responding to reports of harm. Practice and preparation during soft-launch will help in that endeavor.

To succeed in an increasingly competitive business environment, manufacturing companies need to seize every available advantage. Whether negotiating a contract, moving an idea through the patent process or dealing with customers, getting your manufactured products to market requires expertly-coordinated efforts. Any delay can have a significant impact on your business. 

© MICHAEL BEST & FRIEDRICH LLP

Wisconsin Tort Reform 2011: Governor signed the Omnibus Tort Reform Act

As posted on the National Law Review by Joseph Louis Olson and Adam E. Witkov of Michael Best & Friedrich LLP – implications of the Wisconsin Omnibus Tort Reform Act signed into law today by Wisconsin Governor Scott Walker:  

Governor Scott Walker signed the OmnibusTort Reform Act (the “Act”) today, January 27, 2011.  The Act addresses several areas of interest for Wisconsin companies.

Specifically, the Act:

Limits Punitive Damages.

  • Punitive damages are capped at to $200,000 or double the amount of compensatory damages, whichever is higher. The cap does not apply to lawsuits related to operating a motor vehicle while intoxicated.

Raises the Standards for Expert Testimony.

  • This Act adopts the standard set forth in Federal Rule of Evidence 702, also known as the “Daubert standard.” The Daubert standard allows the admission of expert testimony only if it is based on sufficient factors or data and is the product of reliable principles and methods.

Limits the Application of the Risk Contribution Theory.

  • This provision is a response to the Wisconsin Supreme Court’s 2005 decision in Thomas v. Mallett, 2005 WI 129, 285 Wis. 2d 236, 701 N.W.2d 523, where the Court permitted a case to proceed against seven paint manufacturers despite the fact that the plaintiff could not prove who made the lead-based paints that he claimed poisoned him as a child. The Act limits the holding in Thomas. If the claimant can not identify the specific product that allegedly caused the injury, a manufacturer, distributor, seller, or promoter of a product may be held liable only if all of the following apply: (1) the claimant proves: (a) no other lawful process exists for the claimant to seek any redress from any other person for the injury or harm; (b) that the claimant has suffered an injury or harm that can be caused only by a manufactured product chemically and physically identical to the specific product that allegedly caused the claimant’s injury or harm; and (c) that the manufacturer, distributor, seller, or promoter of a product manufactured, distributed, sold, or promoted a complete integrated product, in the form used by the claimant or to which the claimant was exposed, and that meets all of the following criteria: (i) is chemically and physically identical to the specific product that allegedly caused the claimant’s injury or harm; (ii) was manufactured, distributed, sold, or promoted in the geographic market where the injury or harm is alleged to have occurred during the time period in which the specific product that allegedly caused the claimant’s injury or harm was manufactured, distributed, sold, or promoted; and (iii) was distributed or sold without labeling or any distinctive characteristic that identified the manufacturer, distributor, seller, or promoter; and (2) the action names, as defendants, those manufacturers of a product who collectively manufactured at least 80 percent of all products sold in this state during the relevant production period by all manufacturers of the product in existence during the relevant production period that are chemically identical to the specific product that allegedly caused the claimant’s injury or harm.

Limits Strict Product Liability Claims.

  • Under the Act, Wisconsin is now in line with the majority of other states that have adopted the “reasonable alternative design” test instead of the broader “consumer expectation” test. Accordingly, a manufacturer will be liable for damages caused by the manufacturer’s product based on a claim of strict liability only if the injured claimant proves that the product was defective, the defective condition made the product unreasonably dangerous, the defective condition existed at the time the product left the control of the manufacturer, the product reached the user or consumer without substantial change, and the defective condition caused the claimant’s injuries. If the injured party’s percentage of total causal responsibility for the injury is greater than the percentage resulting from the defective condition of the product, the injured party may not, based on the defect in the product, recover damages from the manufacturer, distributor, seller, or any other person responsible for placing the product in the stream of commerce. If the injured party’s percentage of total causal responsibility for the injury is equal to or less than the percentage resulting from the defective condition of the product, the injured party may recover but the damages recovered by the injured party shall be diminished by the percentage attributed to that injured party.

Toughens State Rules Relating to Damages for Frivolous Claims.

  • In civil cases, a party or his or her attorney may be liable for costs and fees for actions that are done (1) in bad faith, solely for the purpose of harassing or maliciously injuring another; or (2) was without a reasonable basis in the law. If the offending party withdraws or corrects the improper conduct within 21 days of receiving the other party’s motion for fees, the court can decide whether to award actual costs taking into consideration the offending party’s mitigating conduct. If the offending party does not timely withdraw or correct the conduct, actual costs shall be awarded. If the decision is appealed and the appellate court affirms the award of fees, the offending party must also pay the attorney fees incurred in the appeal.  

In addition to the tort reform provisions outlined above, the Act includes several health care related provisions previously discussed in a client alert dated January 10, 2011, also available here.

© MICHAEL BEST & FRIEDRICH LLP

FDA Commissioner Margaret Hamburg Key Note Speaker NYSBA Annual Meeting Food, Drug & Cosmetic Law Section Lunch Jan 27th

The National Law Review would like to you know that the New York State Bar Association Food, Drug & Cosmetic Law Section is featuring FDA Commissioner Margaret Hamburg MD as their luncheon keynote speaker on Thursday January 27th as part of the NYSBA’s Annual Meeting being held at the Hilton New York in New York City from Jan 24th-29th. The lunch will be held on Thursday January 27th in the Trianon Ballroom on the 2nd floor. For Tickets and More Information, Please Click Here