Toxic Tort Litigation Blog : Toxic Tort Lawyer & Attorney : Epstein Becker Green Law Firm : Product Liability, Contamination, Pollution

A Lone Pine Order is an innovative judicial case management tool that requires toxic tort plaintiffs to produce credible expert evidence to support their theory of causation (or another key component of plaintiffs’ claim) prior to the commencement of pre-trial discovery. A Lone Pine Order is designed to weed out frivolous claims before defendants must invest hundreds of thousands of dollars in legal fees and incalculable time and effort only to learn prior to trial that plaintiffs cannot establish a prima facie case. Both federal and state court judges have learned by experience that a Lone Pine case management order can end in their infancy baseless cases that would otherwise require an enormous expenditure of judicial time and resources. I have written about the use of Lone Pine Orders both on this blog and in journal articles. 

The most recent successful use of a Lone Pine Order resulted in an order of dismissal in William G. Strudley v. Antero Resources Corporation, et al., a hydro-fracking toxic tort case pending in the District Court for Denver County in Colorado. On May 9, 2012, District Court Judge Ann B. Frick dismissed plaintiffs’ action due to their failure to comply with the court’s Modified Case Management Order (“MCMO”), which had been entered several months earlier. The MCMO required plaintiffs to provide the Court with sworn expert affidavits establishing the identity of the hazardous substances plaintiffs alleged caused their harm; whether these substances could cause the type of diseases and illnesses claimed by plaintiffs (general causation); the dose or quantitative measurement of the concentration, timing and duration of alleged exposure to each substance; an identifiable, medically recognizable diagnosis of the specific disease or illness for which each plaintiff claims medical monitoring is necessary; and a conclusion that each such disease or illness was caused by the alleged exposure (specific causation).

As Judge Frick noted in her decision, the plaintiffs scrambled to provide a creditable response to the MCMO over the next several months. Plaintiffs submitted a jumble of maps, photos, medical records, air and water sampling analysis reports, together with the affidavit of Thomas L. Kurt, M.D., MPH. In a nutshell, the Court found that Dr. Kurt merely opined that further investigation was necessary, but offered no opinion as to whether the purported exposures were a contributing factor to plaintiffs’ alleged injuries or illnesses. Plaintiffs failed to provide any “statement regarding what constitutes dangerous levels of any substance in drinking water or whether any causal link exists between the study’s results and plaintiffs’ alleged injuries.” The Court determined that Dr. Kurt’s Affidavit was wholly lacking in establishing causation and, at times, presented evidence “circumstantially, in direct contradiction to plaintiffs’ allegations.”

In their Complaint, plaintiffs alleged that “environmental contamination and polluting events caused by the conduct and activities of the defendants… caused the release, spills and discharges of combustible gases, hazardous chemicals and industrial wastes from their oil and gas drilling facilities…” According to the petition, the defendants engaged in oil and gas exploration approximately one mile from the plaintiffs’ residence. Plaintiffs alleged that they relied on a groundwater well for “drinking, bathing, cooking, washing and other daily uses,” but that drilling operations had caused various toxic chemicals to contaminate the air and their water well, forcing them to pack up and abandon their home. In addition to personal injuries, they requested that a medical trust fund be established to monitor their medical conditions.

The result achieved in this case was due to excellent legal work by James D. Thompson III at Vinson & Elkins in Houston and Daniel J. Dunn at Hogan Lovells in Denver, who represented Antero.

It is not enough to draft a motion seeking entry of a Lone Pine Order stating, in sum or substance, “how about that Lone Pine Order, judge?” In their memorandum in support of the Lone Pine Order, the Antero lawyers argued: (1) that the facts alleged in plaintiffs’ Complaint were not sufficient for the court or the parties to expend their resources in discovery; (2) that plaintiffs’ Complaint identified no specific exposure or injury; (3) that plaintiffs’ initial disclosures provided no evidence of specific exposure, injury or causation; (4) that independent evidence concerning the well operations demonstrated that there was no factual basis for plaintiffs’ claims; (5) that the court had the authority to enter a Lone Pine Order; and (6) that the Lone Pine Order would in no way prejudice plaintiffs. The defendants successfully argued that any burdens associated with requiring plaintiffs to make a prima facie showing on their claims were outweighed by the benefits:

A Lone Pine order will assist the parties and this Court in efficiently and effectively assessing the merits of plaintiffs’ claims before engaging in costly and time-consuming full discovery and pre-trial procedures. Such an order will promote efficient pre-trial and trial proceedings by focusing whether plaintiffs can produce admissible expert testimony concerning exposure, injury and causation. If plaintiffs cannot produce such discovery, then the resources of the parties and the Court should not be wasted. Dismissal, in that instance, would be appropriate.

Amen!

It is not as if plaintiffs' counsel did ot have the financial or technical resources to comply with the Lone Pine Order if their clients' case had merit.  Plaintiffs are represented by Napoli Bern Ripka Shkolnik, LLP, a well-heeled New York plaintiff personal injury firm that had the resources to represent hundreds of plaintiffs in the World Trade Center Disaster Site Litigation and battle Exxon  in the New York City MTBE Litigation.  The Napoli Law Firm has now branched out, according to its website, into the oil and gas exploration field and has conducted  informational meetings with groups of  Colorado residents residing near drilling operations concerning their legal options.

If plaintiffs' evidence of causation was so lacking in the high-profile Strudley case, why shouldn't all similar hydrofracking cases be "tested" by Lone Pine?  The alternative is to subject oil and gas industry defendants nationwide to the burden of defending frivolous spare-no-expense WTC Disaster Site-style litigations. These toxic tort cases can go on for years and take on a life of their own. Better for the courts and all the litigants if causation evidence must be demonstrated at the outset of the case rather than at the tail end.   

In 2008, the parents of Sean Reeps, brought suit against BMW, Martin Motor Sales and Hassel Motors ("Hassel"), alleging that Sean's mother, Debra, was exposed to gasoline fumes in the family's BMW during her pregancy, which resulted in Sean being born with birth defects. The Complaint alleged causes of action in (1) negligence; (2) strict products liability; (3) breach of express warranty; and (4) breach of implied warranty (merchantability) . The timeline of events is as follows:

1991-In March and again in November, Reeps bring their 1989 BMW 525i to Hassel Motors, a licensed BMW dealer, to fix an exhaust odor inside the car.  Dealer fails to identiify an exhaust odor in March, but later identifies problem as a split fuel hose and repairs it under warranty.

1992-In May, Sean Reeps is born with birth defects, including cerebral palsy, which plaintiffs  attribute to Debra's  inhalation of gas fumes early in pregnancy.

1994-BMW recalls BMW525i vehicles due to safety defect that caused odor due to feed fuel hose. Car is no longer with plaintiffs at the time.

On summary judgment, BMW argued that plaintiff's claims were barred by the doctrine of spoliation because plaintiff could not establish a prima facie case without the car or the fuel hose to show the actual alleged defect.  BMW's expert testified by affidavit that the Reeps' leakage was caused by a split in the fuel hose, not by the defect that was the subject of the recall.  Thus, in the absence of the actual fuel hose, BMW argued, plaintiff could not demonstrate a defect. 

The trial court rejected BMW’s spoliation argument, holding that there was no evidence of “willful or contumacious conduct” by plaintiff in disposing of the car. Remarkably, the Reeps’ BMW was actually found, but clearly not in the same condition as it was in 1991 and, not surprisingly, without the original fuel hose. The trial court held that plaintiff was not “barred from pursuing his claim, but rather he will have the onerous trial burden of proving his case solely by circumstantial evidence.”

New York law requires that to establish a prima facie case for strict product liability or design defect, a plaintiff must show that the manufacturer marketed a product that was not reasonably safe in its design; that it was feasible to design the product in a safer manner; and that the defective design was a substantial factor in causing the plaintiff’s injury. When the product at issue is no longer available, and the plaintiff seeks to prove a manufacturing defect by circumstantial evidence, the plaintiff must not only establish that the product did not perform as intended, but must also exclude all other causes of failure not attributable to the manufacturer.

The trial court denied Hassel's motion for summary judgment. The gravamen for plaintiff’s claims against Hassel was that it was negligent in failing to find the split fuel hose when the Reeps first complained of fuel odor in March 1991. Plaintiffs argued that if Hassel had identified and repaired the problem, Mrs. Reeps would not have inhaled any fumes during her pregnancy. In denying the dealer’s motion for summary judgment, the court observed that there is a high bar for obtaining summary judgment in a negligence action. As the court noted, “Simply put, Hassel must prove that it was not negligent when it failed to find a source of the gas fumes complained of by the Reeps in March 1991. It has not done so.”

In its decision, dated April 5, 2012, the Appellate Division, First Department, weighed in on both the spoliation issue and the motion for summary judgment by Hassel. On the spoliation issue, the Appellate Division held that the defendants “failed to demonstrate that the parents disposed of the vehicle with knowledge of its potential evidentiary value.” Moreover, the court discussed the existence of other available evidence, including BMW’s Recall Bulletin and Hassel Motors-service records for the relevant period, which served to mitigate the loss of the vehicle. Basically, the court examined two of the key factors in evaluating spoliation sanctions – prejudice and intent – and determined that the movants had failed to establish either element in seeking sanctions.

As to plaintiff’s claims against Hassel, the Appellate Division held that the product liability and breach of implied and express warranty claims should be dismissed because the service provider did not design, manufacture, distribute or sell the vehicle. This holding may be the most important in the case because it clarifies that service providers, as opposed to product sellers, can not be held liable under strict product liability or breach of warranty theories of liability. Therefore, the only remaining claim against Hassel sounds in negligence, which may be difficult for plaintiff to establish at trial after a twenty year hiatus.

Apart from its other burdens, plaintiff will have to demonstrate general causation at trial, that is, whether exposure to chemical components in gasoline fumes have been associated in the scientific literature with the specific teratogenic effects alleged, including cerebral palsy. If plaintiff is able to prove general causation, he will then have to prove specific causation, that is, whether the dose of the purported teratogen was high enough, and lasted for a sufficient duration, to cause the specific birth defect.

The plaintiff attributes his injury to Debra Reeps’ inhalation of gas fumes during the first couple of months of her pregnancy between August 1991 and November 1991, when the problem with the vehicle was fixed. Are the alleged teratogenic effects associated with a toxic exposure early in pregnancy? How often did Debra Reeps ride in the automobile during those first couple of months? If the odor problem was significant, is it likely that the Reeps would not have returned their BMW 525i, which was under warranty, to the dealership before November? Because there is no expert deposition discovery under New York state practice, we will have to await trial to learn how these issues plays out.
 

New York state courts are increasingly turning to federal Zubulake standards when confronted with spoliation of electronic evidence issues. However, in dealing with garden variety spoliation of evidence scenarios, not involving ESI, New York courts have generally engineered their own solutions without turning to federal common law for guidance. We previously addressed how New York courts address ESI spoliation.

Pursuant to the common law doctrine of spoliation, when a party negligently loses or intentionally destroys key evidence, the responsible party may be sanctioned. There may be circumstances where the destruction is so egregious that the offending party’s pleading may be stricken where no other remedy will achieve a fundamentally fair outcome.

In their article, “Remedies for Spoliation of Evidence,” published in the New York Law Journal on March 27, 2012, Plaintiff lawyers Robert S. Kelner and Gail S. Kelner provide a good overview of how state courts address spoliation of evidence and the circumstances under which a court will impose the “ultimate sanction.”

Unlike some states, New York does not recognize an independent tort claim for third-party negligent spoliation of evidence. In a 2007 Court of Appeals case, Ortega v. City of New York, 9 N.Y.3d 69, 845 N.Y.S.2d 773 (2007), the City of New York was under a court order to preserve an impounded vehicle so that the cause of a vehicular fire could be determined by forensic analysis. Due to negligence, the City of New York failed to preserve the vehicle. Despite this negligent destruction, the court declined to establish an independent tort of spoliation of evidence, pursuant to which a tort action against the City of New York might have been pursued. In declining to establish a spoliation tort, the court explained that there was “no way of ascertaining to what extent the proof would have benefited either the plaintiff or defendant in the underlying lawsuit and it is therefore impossible to identify which party, if any, was actually harmed.” Applying this logic, the Ortega court stated that an independent cause of action was not viable because it would recognize a claim that, by definition, could not be proved without resort to speculation. However, speculative the damages that might have resulted from spoliation in Ortega,  New York courts have not hesitated to levy sanctions when a party has destroyed evidence.

New York courts have been willing to strike an offending party’s pleading when it can be shown that a party destroyed key evidence which deprived the adversary of its ability to prove its claim or defense. The court may also, in its discretion, apply any number of remedies short of striking the pleading. These remedies include an “adverse inference” (where the jury is instructed that it may infer that the missing evidence, if available, would tend to inculpate the spoliating party), or preclusion of testimony at trial. Generally, in crafting an appropriate sanction, the trial court will consider two factors first and foremost: (1) whether the destruction was willful; and (2) the resultant prejudice.  Prior to bringing a spoliation issue to the court's attention, the practitioner should document by every means possible the intentional nature, if appropriate, of the spoliation at issue through investigation and discovery. 
 

Guest Blogger Nicolas S. Allison  is an Associate in Epstein Becker & Green's Asbestos Group in New York. A graduate of Princeton University and Boston University Law School, in addition to his mass tort asbestos work, Nick also represents firm clients in a wide variety of industries, including financial institutions, health care providers and health care insurers.  He also defends environmental claims brought under the New York State Navigation Law.  In discussing the Supreme Court's recent decision in Kurns v. Railroad Friction Products Corp, Nick and I examine the reasoning of  the majority opinon, the concurring opinion and the concurring/dissenting opinion and how the justices address plaintiff's failure to warn and design defect claims in light of the preemption under the Locomotive Inspection Act . 

On February 29, 2012, the Supreme Court issued a preemption decision in Kurns v. Railroad Friction Production Corp, an asbestos product liability case. The case is noteworthy for product liability and toxic tort practitioners because of the Court's split analysis concerning the potential preemptive effect of federal legislation on failure to warn claims.

Plaintiff's decedent, George Corson, was a machinist for the Chicago, Milwaukee, St. Paul and Pacific Railroad. As a machinist, his duties included the removal and replacement of asbestos-containing brake shoes and insulation on the company’s locomotives. In 2005,  Corson was diagnosed with malignant mesothelioma, after which Corson sued several dozen manufacturers, including  part suppliers of the railroad company's locomotives. The trial court granted summary judgment to the railroad supplier defendants on preemption grounds and the Third Circuit affirmed. The issue before the Supreme Court was whether federal preemption should result in dismissal not just of the design defect claim, but to the failure to warn claim as well 

Writing for the 6-3 majority, Justice Thomas summarily rejected Plaintiff’s argument that, as a distinct cause of action, her failure to warn claim was not preempted by federal law. Thomas reasoned that “the ‘gravamen’ of petitioners’ failure to warn claims ‘is still that [Corson] suffered harmful consequences as a result of his exposure to asbestos contained in the locomotive parts.” By summarily rejecting the argument and conflating failure to warn claims with defective design claims, Thomas does little to present a concrete roadmap for evaluating the preemptive effect of federal law involving product liability causes of action.

Dissenting in part and concurring in part, Justice Sotomayor more or less adopted plaintiff’s approach, drawing a distinction between failure to warn claims and design defect claims. Sotomayor reasoned that "a product may be flawlessly designed and still subject its manufacturer or seller to liability for lack of adequate instructions or warnings."  Despite  a scholarly analysis of product liability jurisprudence,  Sotomayor did not persuasively explain how the distinction precludes the preemptive effect of the federal legislation at issue. It is noteworthy that her analysis failed to persuade six other justices on the Court.  .

In practical terms, Justice Kagan’s concurring opinion possibly articulates the strongest underpinning of the majority opinion.  Her preemption analysis examined the broad regulatory authority granted under the Locomotive Inspection Act.  Kagan reasoned that “if an agency has the power to prohibit the use of locomotive equipment, it also has the power to condition the use of that equipment on proper warnings.” Under this reasoning, Kagan determined that because the agency could have required warnings about the equipment's use, the petitioner's failure to warn claim, no less than her defective design claims, was  preempted.  Thus, under Kagan’s preemptive analysis, regulatory silence has the same preemptive effect as explicit regulation.

This case represents an unusual application of field preemption--unusual because there is no indication that Congress intended to foreclose all state action concerning railroad safety rather than just the regulation of equipment used by the railroad.  Some commentators have sought to isolate the case from other preemption jurisprudence by arguing that the outcome of the case may have been different  if the Court did not feel bound by the precedent established in a 1926 Supreme Court case, Napier v. Atlantic Coast Line. Still others have argued that the case represents an usual  departure for Justice Thomas, who generally narrowly construes the scope of  federal power over the states.

What is intruiging for product liability defense counsel is the idea, impliedly advanced by Justice Kagan, that warnings and instructions (the part of the product conveyed in print) should be treated as just another part of a product's design and not as the basis for an independent cause of action.  For the past several decades, plaintiffs have always had two bites at the apple--defectiive design and failure to warn. If the product was flawlessly designed, they could retreat to their warning claim.  If the product had terrific warnings, they could argue in the alternative that the poor design of the product could not be cured by strong warnings.  If this case is interpreted by future trial courts (in a non-preemption context) to mean that a failure to warn claim should be considered as part and parcel of a defective design claim, rather than a separate claim, manufacturers will have obtained an important precedent in Kurns.  Only time will tell.

In defending a United States defendant in an action involving a foreign accident and foreign claimants, it is almost a knee jerk reaction to file a motion to dismiss on forum non conveniens grounds. In a thought provoking article, “Be Careful What You Ask For – the Forum Non Conveniens Dilemma,” Cozen O’Connor lawyersRichard Dunn and Raquel Fernandez bring this practice into question. Mr. Dunn and Ms. Fernandez urge a different standard for analyzing whether to file the motion. The question that should be asked is whether it is beneficial for the U.S. defendant company to be subject to the laws and procedures in the foreign jurisdiction.

Thus, it is critical to understand the foreign jurisdiction’s law before your client is stuck there in litigation. A few of the considerations to think about include:

(1) Can your client get out of the case on summary judgment? Many foreign jurisdictions do not provide for summary judgment. Therefore, all matters before a court must be tried to conclusion, which may potentially lengthen and increase the cost of proceedings;

(2) How much time will your client have to prepare its case? Some foreign jurisdictions allow a short time for defendant to mount its defense, which may be an important consideration in a complex product liability case where it is necessary to hire and prepare appropriate experts. Moreover, the documentary evidence that supports your client’s case has to be translated into the foreign jurisdiction’s official language; 

(3) Will discovery be allowed? In some foreign jurisdictions, there is nothing akin to the discovery procedures that benefit parties in the United States;

(4) Will expert testimony be allowed? Often, the foreign court will place great emphasis on the government accident investigation report rather than on the expert evidence. In some jurisdictions, your client’s liability may be determined by the government authorities charged with investigating the accident, although they may not be competent;

(5) What is the role of the judge? Is the court the sole trier of fact?;

(6) Are there multiple claimants? You should determine whether all of the claimants involved in the incident can be consolidated before the same tribunal. If each claimant is able to file suit in his or her own locale, the client may need to defend numerous actions before numerous judges in different locations; and

(7) What are the attitudes towards the United States and American businesses in the foreign jurisdiction?

Anti-American bias and corruption figured prominently in Chevron’s environmental litigation in Ecuador. In the early 1990’s, Ecuadorian claimants filed suit in the United States alleging that Texaco’s operations polluted the rain forests and rivers in Ecuador, resulting in environmental and personal injury damages. The lawsuit was dismissed in 2002 on forum non conveniens grounds and the case was refiled in Ecuador the following year. In February 2011, an Ecuadorian court entered an $18,000,000,000 judgment against Chevron (which had earlier acquired Texaco).

Scott A. Edelman, a partner at Gibson Dunn in Los Angeles, made a compelling presentation at a recent IADC meeting concerning serious irregularities and a lack of impartiality in the conduct of that case. Chevron alleges that the plaintiffs’ lawyers are guilty of fraud and misconduct and have filed a civil lawsuit under RICO in New York federal court against the trial lawyers and consultants involved. Chevron’s suit alleges that these attorneys and consultants used the Ecuador lawsuit to threaten Chevron, mislead U.S. government officials, and harass and intimidate Chevron employees, to extort a financial settlement from the Company. Chevron further alleges that plaintiffs built their case through fabricated evidence and a campaign to incite public outrage.

It is likely that the pervasive fraud that permeated the Ecuador litigation would not have occurred in a U.S. federal court. As a result of Chevron’s experience, a U.S. defendant would have to think twice about filing a forum non conveniens motion if there was any likelihood that the case would end up in Ecuador or somewhere similar.

In the case of Wyeth v. Weeks, the Alabama Supreme Court consented to answer the following question from the Middle District of Alabama: “Under Alabama law, may a drug company be held liable for fraud or misrepresentation (by misstatement or omission), based on statements it made in connection with the manufacture or distribution of a brand-name drug, by plaintiffs claiming physical injury from a generic drug manufactured and distributed by a different company?" In its brief filed on December 12, 2011—a combined effort with the Alabama Defense Lawyers Association—the Defense Research Institute (DRI)  argues that well-established state tort duty principles prohibit imposing liability on a brand-name manufacturer that did not manufacture the product ingested by plaintiffs. The contrary decision of the Middle District of Alabama is one of but three decisions in the entire country that have allowed failure-to-warn claims to proceed against a brand-name manufacturer where the plaintiff ingested a generic version of the brand-name drug.

The dispute in this case stems from plaintiffs who ingested generic metoclopramide and developed tardive dyskinesia. The plaintiffs claimed that the generic manufacturer failed to warn of the dangers of metoclopramide adequately, and sued the generic defendant on a failure to warn theory. However, the United States Supreme Court recently ruled in PLIVA, Inc. v. Mensing that, because federal regulations prohibit generic manufacturers from unilaterally altering their warning labels, state tort failure-to-warn claims against generic manufacturers are preempted by federal law. Accordingly, the plaintiffs brought suit against the brand-name manufacturers, and the Middle District of Alabama denied in part the brand-name manufacturers’ motion to dismiss. DRI argues against extending common tort principles out of their shape to impose a duty on a defendant who did not manufacture the product and has no control over it. DRI maintains that federal preemption of generic manufacturers does not change this result, even if application of proper tort principles leaves the plaintiff without a remedy.

It would be bad jurisprudence and bad precedent for the Alabama Supreme Court to uphold plaintiffs' position and impose liability on a drug manufacturer, whose  product did not cause the alleged harm.  If that was the result, it is conceivable that a manufacturer with only 10% market share could be held strictly liable for adverse drug reactions caused by generic competitors, who might collectively control 90% of the market.  It would be unfair and unequitable to shift the burden of liability to a manufacturer whose product did not cause the injury merely because the Supreme Court has ruled that preemptioin protects generic manufacturers against state tort failure-to-warn claims. 

Sunovion Pharmaceuticals obtained summary judgment on October 5, 2011 after oral argument before the Hon. Stefan R. Underhill in federal court in Bridgeport, Connecticut in the case of Swoverland v. GlaxoSmithKline, 2011 U.S.Dist.LEXIS 127753.  Co-Defendant GlaxoSmithKline, represented by King & Spalding, also obtained summary judgment.  William A. Ruskin and Victoria Sloan of Epstein Becker & Green represented Sunovion. 

The plaintiff alleged that his use in combination of Sunovion’s Lunesta, a sleep aid, and GSK’s Paxil, an anti-depressant, caused depression and suicidal ideation, which resulted in an unsuccessful attempt to kill both himself and his daughter.  As a result of the incident, plaintiff was sentenced to prison and forfeited his position as a prison guard.  Sunovion defended the case on the basis that it adequately warned of the drug’s potential risks and that there was no causal connection between any alleged failure to warn and the treating physician’s prescription of the drug. 

In granting summary judgment to Sunovion, the court reaffirmed Connecticut’s adherence to the learned intermediary doctrine on the basis of the Connecticut Supreme Court's 2001 decision in Vitanza v. Upjohn, 257 Conn 365.   Judge Underhill described the learned intermediary doctrine as "essentially hold[ing] that because there is, or when there is a traditional physician/patient relationship, because the physician is the decision-maker as to whether a particular drug will be used by the ultimate consumer, it is the adequacy of the warnings to the physician that matter.  The Court also rejected plaintiff’s assertion that the learned intermediary doctrine should not apply in this case either because Lunesta directly advertised to the patient or over-promoted the product.  The Court held that there was no factual basis in the record to support the application of either of these exceptions to the learned intermediary doctrine and that, as a matter of law, Connecticut did not recognize these exceptions.

Kenneth Ross, one of the more discerning authors in the product liability defense bar, has authored a thoughtful piece titled, Is There Anything Optional About Safety? in the August '09 DRI Product Liability Committee Newsletter--"Strictly Speaking".  As manufacturers design new products and update the design of old products, many times they sell and offer for sale differing levels of safety and quality.  Ken's article explores the legal and practical risks in selling products with these differences and provides advice to manufacturers about minimizing risk.  As one law professor notes, the case law is "muddled and quite sparse".  There are cases on both sides--those that hold that safety devices can be optional and those that hold that not installing a safety device establishes a basis for liability.  Ken discusses several important considerations that should be weighed in performing this delicate balancing act.

BNA Toxics Law Reporter reports that on August 3, 2009, the First Circuit affirmed the dismissal of the American Chemistry Council ("ACC"), formerly known as the Chemical Manufacturers Association, in a case arising from a plaintiff's long-term exposure to vinyl chloride. The First Circuit's decision in June Taylor et al v. ACC, et al is attached. The ACC is the chemical industry's trade association.  The ACC has been effective in improving the image of the chemical industry in the United States and in promoting safety and environmental initiatives within its membership.  The family of Claude Taylor alleged in federal district court in Massachusetts that ACC, along with several chemical manufacturers, should be found liable for failure to warn, conspiracy and fraud for helping to produce false and misleading warnings that were adopted by the PVC industry.  The plaintiff focused on an ACC publication entitled, "Chemical Safety Data Sheet SD-56", which was first published in 1954 and later revised in 1972, claiming that the publication downplayed the danger of VC exposure.  In upholding the trial court's dismissal of the claims against the ACC, the First Circuit held that there was no evidence that the trade association had the "unlawful intent" necessary to establish "substantial assistance liability" under MA law.  The court held that it would have been necessary for plaintiff to prove that ACC was aware of Monsanto's tortious conduct and that it intended to assist or encourage that conduct.  The wide dissemination of SD-56 within the industry was not sufficient to support the claim that the ACC was aware that Monsanto was incorporating SD-56 into its own literature.  ACC's lawyer, Tim Couglin of Thompson Hine, successfully convinced the appeals court that: (1) ACC did not provide "substantial assistance" to Monsanto; (2) ACC had no knowledge of Monsanto's activities; and (3) there was no record evidence to support the underlying conspiracy claim. 

Trade associations do not manufacture or market products, but they have been the targets of toxic tort and product liability plaintiffs nonetheless.  The threshold issue in these cases is whether the association owed a duty of care to the plaintiff.  In cases in which the trade association is alleged to have promulgated a safety standard, the issue often comes down to the degree of control the trade association has over its members.  In the absence of control, the trade association is not as likely to be held liable for failure to warn.  What about a trade association that endorses products?  If a plaintiff's injury is due to a defect in a product bearing the "Good Housekeeping Seal of Approval", for example, is the association potentially liable?  One California court replied in the affirmative if it could be demonstrated that the association obtained economic gain from the endorsement and encouraged the public to purchase the product, and that  the plaintiff relied on the representation to his detriment.  Courts appear to recognize that it is not in the public interest to hold trade associations liable for injuries to remote plaintiffs in tort litigation.  The AAA might rank hotels on the basis of service and cleanliness.  Should the AAA be subject to liability for injuries allegedly resulting from its failing to warn its members that a hotel was located in a bad neighborhood?

Innis Arden Country Club is a well-run country club located on beautiful acreage in Old Greenwich, CT. that has operated for over 100 years. Close friends of mine are members--the food is good, the golfers congenial, and laughing children run barefoot across the pool deck in good weather.  Club members had been stunned to learn in 2004 that PCB contamination had been discovered on the golf course property, not far from where an industrial company, Pitney Bowes, had once conducted operations on an adjacent parcel in Stamford.  The country club's environmental consultants determined that Pitney Bowes was the source of the contamination, which Pitney Bowes denied, and that PCBs from the Pitney Bowes property had migrated by way of storm water and surface water runoff to Innis Arden.  What no one could dispute was that the country club had not placed the PCBs on the golf course--it was what CERCLA characterizes as an "innocent landowner". On June 26, 2009, the federal district court in Connecticut dismissed Innis Arden's complaint prior to trial and affirmed a prior sanctions award against the country club. Innis Arden Golf Club v. Pitney Bowes, Inc. et al. Case No. 3:06 cv 1352 (JBA), 2009 U.S. Dist. LEXIS 54135.  Something had gone terribly wrong!  But what?

Pitney Bowes retained Hunton and Williams, a law firm with a strong reputation in environmental litigation to defend the case.  In a July 2009 Client Alert, the law firm attributed Innis Arden's dismissal to its consultant having destroyed the key evidence that allegedly linked the PCB's at the country club to their client.  Without being able to perform tests on the actual soil samples the consultant had taken, Pitney Bowes would be unable to refute the consultant's claim that the PCB's on the golf course were identical to PCB's identified on the Pitney Bowes' site, it alleged.  As the Alert points out, the Court's spoliation ruling is a strong reminder of the obligations of parties and their experts to impose a litigation hold and to ensure that tangible evidence, such as as a soil sample taken to the lab for testing, is preserved.  Central to the court's ruling was that the soil sampling in question had been undertaken in preparation for litigation.  As the Magistrate Judge had earlier ruled "......counsel was actively involved in the investigation and analysis of the samples in preparation for legal action......"  Sanctions were awarded even though the Court concluded that Innis Arden had not intended to destroy evidence or to disadvantage Pitney Bowes.  In the Bow Tie Law Blog, the author opines that Innis Arden's "toxic mess" was created in part by deposition testimony that made it clear to the Court that plaintiff had taken no steps to prevent the destruction of electronic and tangible evidence as early as 2005, by which time it was clear that plaintiff recognized the importance of that evidence in its future litigation. 

By the time  the spoliation sanctions issue came before Judge Atherton on a motion for reconsideration, Innis Arden was in even deeper trouble.  The Magistrate Judge had also awarded sanctions against Innis Arden for discovery abuses--the most egregious that the Magistrate Judge had seen during over twenty years on the federal bench.  Worse, Judge Atherton concluded after hearing Daubert motions that Innis Arden's trial experts were not sufficiently reliable to be permitted to testify at trial.  On the basis of that ruling, she granted summary judgment to the defendants and dismissed the plaintiff's complaint.  At the end of the day, the Court did not have to reconsider the Magistrate Judge's spoliation ruling because the issue was now moot!  Still the "innocent landowner", Innis Arden's complaint has been dismissed and may yet have to pay the defendants' sanctions for discovery abuses.   

In a provocative thought piece appearing in the Wall Street Journal on March 9, 2009, L. Gordon Crovitz predicts that the United States Supreme Court decision in Wyeth v. Levine will usher in an era of increased prices for drug and create a disincentive for new product innovation. Mr. Crovitz compares the American legal culture behind the Court's decision to the Luddites that smashed mechanized looms in England at the beginning of the Industrial Age in 19th century England.  He also suggests that the decision's logic may lead product manufacturers to "carry 50 different warnings, one for each state, updated by local juries from time to time."  Despite his misgivings about the decision, it is not likely that any product manufacturers, drug makers or otherwise, are likely to start tailoring their warning on a state by state basis.  As a practical matter, products are sold nationally, often through distributors, and it would be virtually impossible to  ensure that product warnings for Texas purchasers ended up in Texas and that product warnings intended for California purchasers ended up in California.  Moreover, from a jury standpoint, nothing would please a plaintiff's lawyer more than to be able to argue that the manufacturer provided a less strict warning for the product in the jurisdiction where his client's accident occurred.