Sunday, March 25, 2012

GUEST POST - Drug and Device Law Blog Re: Important Recent Products Liability Decision by Pennsylvania Supreme Court

The below is a guest post by permission from Attorney James Beck of the Philadelphia law office of Dechert LLP and the excellent Drug and Device Law Blog:

Drug and Device Law Blog

Pennsylvania Product Liability Law - The Muddle Continues
(March 23, 2011)

The Pennsylvania Supreme Court yesterday decided Beard v. Johnson & Johnson, Inc., No. 35 WAP 2010, slip op. (Pa. March 22, 2012), a decision that is good, bad, and ugly at the same time. We say "ugly" because the entire decision - a discussion of strict "malfunction theory" liability in the context of a medical device, is based on a fundamental error (at least we'd say so) that was never brought to the court's attention. That is, the Court in Hahn v. Richter, 543 Pa. 558, 673 A.2d 888 (1996), held that strict liability did not apply at all to any prescription drug, given the court's reading of Restatement §402A, comment k. Subsequently, the Pennsylvania Superior Court (in accordance with the massive majority of cases nationwide) held that comment k would be applied in the same fashion to medical devices. See Creazzo v. Medtronic, Inc., 903 A.2d 24 (Pa. Super. 2006). Thus, Creazzo followed Hahn and held that strict liability simply does not apply to prescription medical devices.

But this foundational issue - whether a strict liability theory was even appropriate in a case involving a prescription medical product - was neither raised nor discussed, apparently at any level in Beard. Why? We don't know.

Next, the good parts of Beard. The medical device in question, a really fancy stapler used for holding tissue together in complicated surgery where for one reason or another suturing is impossible or inappropriate, was designed for use in a variety of different surgical settings. The plaintiffs (who had not preserved the device in question) claimed that risk-utility balancing concerning the design of the device should be conducted with blinders on - that the analysis should be limited to the particular use to which the device was put in the plaintiff's surgery. The Court refused to limit the scope of risk-utility balancing in that fashion:

For better or worse, this Court’s decisions have relegated our trial courts in the unenviable position of “social philosopher” and “risk-utility economic analyst.” This having been done -- and as the present case does not provide an appropriate opportunity for reconsideration of such assignment – we decline to require the trial courts to put on blinders. It should be enough to say that a product’s utility obviously may be enhanced by multi-functionality, so that it would be imprudent to deny trial courts the ability to assign some weight to this factor in assessing product design. . . . [Plaintiff’s concessions of the net social utility calculus in the area of the [device’s] primary design [a different kind of surgery] are irreconcilably inconsistent with his claim of an inherent design defect. . . .

[T]here is much at stake in the condemnation of a product’s design, above and beyond any individual damages award or awards, including the impact on product costs and design innovation. On balance, we differ with Appellant’s position that the desire to streamline a particular facet of products litigation should be accorded priority over the wider-ranging assessment which was obviously intended from the outset, as manifested in the above characterizations of the trial court’s role, in the open-ended factors which have been accepted by Pennsylvania courts as the basis for risk-utility review, and otherwise.

Beard, slip op. at 24-24 (footnotes omitted).

After Beard, it is settled that, with respect to design defect claims in Pennsylvania, defendants will be able to defend by relying on the benefits of their designs in other uses of the product. This should apply both to the Pennsylvania-peculiar judicial balancing of risks and benefits required under existing law (see Beard, slip op. at 25), and to the presentation of a risk/utility defense to the jury at trial. See Phatak v. United Chair Co., 756 A.2d 690 (Pa. Super. 2000) (evidence bearing on same risk utility factors may be submitted to the jury in design defect cases).

This aspect of Beard can only help defendants by allowing them to compare their design to the plaintiff's alternative design across the entire spectrum of a product's intended uses. Since the plaintiff's alternative design is usually tailormade to address only the accident in a given case, the alternative's adverse consequences to many other people who use the product will put before the jury the same broad perspective of product design that manufacturers necessarily employ in the real world.

The bad aspects of Beard are hinted at in the language we quoted above: "the present case does not provide an appropriate opportunity for reconsideration of such assignment." Yet again, the defense community has missed an opportunity to have the wide-open existential question that hovers over all Pennsylvania product liability law - the negligence-based Restatement Third theory, versus Pennslvania's idiosyncratic form of strict liability expressed by Azzarello v. Black Brothers Co., 480 Pa. 547, 391 A.2d 1020 (1978) - decided.

Justice Saylor, who wrote Beard, is (as he stated in the opinion, slip op. at 23) one of "several justices" on record as supporting a shift away from Azzarello's extreme separation of "strict liability" from "negligence." But as yet "a majority consensus has not yet been attained in any case." Slip op. at 23. The three justices who first advocated the change, "Saylor, J., joined by Castille, J. and Eakin, J.," id., aren't getting any younger. Since Justice Saylor wrote Beard, he was careful to avoid anything that would undercut the Third Circuit's prediction (which we discussed here) that the Court would eventually move to the Third Restatement. See slip op. at 23 (mentioning Third Circuit prediction in Covell v. Bell Sports, Inc., 651 F.3d 357 (3d Cir. 2011), and "[r]ecogniz[ing] the continuing state of disrepair in the arena of Pennsylvania strict-liability design defect law"). The Beard opinion also mentions the Third Restatement favorably in a footnote. Id. at 26 n.18.

A three-justice concurrence (Baer, McCafferty, Todd, JJ.) dissaociates itself with footnote 18, also pointing out the unfortunate truth that, “[defendants] failed to raise this [Third Restatement] issue in their Pa .R.A.P. 1925(b) statement of errors complained of on appeal.” Id. at 2. These three justices steadfastly “express no opinion on the merits of the adoption of the Restatement Third.” Id. Significantly, however, none of these justices comments adversely on the Third Circuit's continuing prediction in Covell of an eventual change.

However, another chance to get rid of Pennsylvania's archaic and extremely pro-plaintiff strict liability has gone by the boards. While reading tea leaves is never easy, the fact that only three justices chose to disassociate themselves from Justice Saylor's pro-Third Restatement comments in Beard suggests that there could well be a four-justice majority on the current court to jettison Azzarello in a case where this issue is preserved. Every defendant adversely affected by Azzarello should take care to preserve this issue from the outset. Express preservation at the trial court level is required. See Schmidt v. Boardman, 608 Pa. 327, 353, 11 A.3d 924, 940 (2011).

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.