Supreme Court Limits Liability of Medical Device Manufacturers

[Brown]

In another thread dealing with the subject of tort reform, I noted:Basically, regulations are relevant to a defense in, say, a product liability case, but they are not a complete defense. The thinking is that regulations set a minimum level of conduct, not a maximum, so a company should not be immune from liability merely by adhering to the minimum standard. Unfortunately, some industries and companies are heavily regulated, and sometimes regulations don't just specify minimums.The notion of regulations being a complete defense was changed today, in the case of Riegel vs. Medtronic, Inc. (http://www.supremecourtus.gov/opinions/07pdf/06-179.pdf) The case dealt with one area where there is heavy government regulation, namely, the field of medical devices (and more specifically, Class III devices).

In an opinion by Justice Scalia (with seven members of the Court joining the opinion, one joining the opinion in part and one dissenting), the Court noted the extent of heavy regulation (or "federal oversight") applicable to certain types of medical devices. In this case, the device in question, a balloon catheter, was subject to heavy regulation. While the balloon catheter was being used to try to clear a blockage in one of Mr. Riegel's blood vessels, the balloon failed, and Mr. Riegel suffered permanent injuries. The Riegel family sued the maker of the device, Medtronic, in federal court in New York, alleging grounds based upon New York state product liability laws.

Medtronic had a legitimate defense, namely, that the device failed because it had been used beyond its tolerance. This defense might have prevailed in front of a jury. But Medtronic sought to win the case outright, without having the case go to a jury, by asserting that the extensive federal regulation preempted application of the state product liability laws. The district court agreed with Medtronic, and so did the Second Circuit Court of Appeals.

The statute passed by Congress provided that federal law would preempt any New York requirements that are "different from, or in addition to" the federal requirements. The Court determined that New York's common-law tort laws would be requirements that are different from or in addition to the federal regulation.

In dissent, Justice Ginsburg said that Congress never intended to preempt state common-law tort suits. (Congress adopted its legislation during a period in which there was extensive medical device tort litigation, yet Congress said not one word about preempting such state-based litigation or in any way reducing any consumer protection.) But a majority disagreed. Justice Scalia noted that the federal regulations are directed to safety and efficacy of medical devices; but in a tort lawsuit, the focus is on safety, not efficacy, and the focus in a tort lawsuit is only on how one person was affected:A state statute, or a regulation adopted by a state agency, could at least be expected to apply cost-benefit analysis similar to that applied by the experts at the FDA: How many more lives will be saved by a device which, along with its greater effectiveness, brings a greater risk of harm? A jury, on the other hand, sees only the cost of a more dangerous design, and is not concerned with its benefits; the patients who reaped those benefits are not represented in court."Safety and effectiveness are the very subjects of the Riegels' common-law claims," said the Court, and to the extent that their state-based claims seek to impose any "requirement" that is different from the federal regulation, the state-based claims are preempted.

The ruling makes a degree of sense. Some manufacturers in heavily regulated industries simply do not have the option to "make their product safer" on their own initiatives. Rather, they must satisfy governmental requirements, which sometimes mandate not only minimum specifications, but also maximum specifications. Any changes to the product, even changes that would improve consumer safety, must be approved by the regulatory process and cannot be done by the manufacturers on their own.

A state-law based product liability lawsuit, however, generally assumes that a manufacturer of a product can make it safer whenever it wishes. Manufacturers in heavily regulated fields, however, have found themselves in a Catch-22: the government says that the product must be a certain way for it to receive regulatory approval, and it cannot be changed without further regulatory approval; but a jury determines that the manufacturer was at fault for not making the product in a different, safer way. Cavalier assertions that "regulations set a minimum level of conduct, not a maximum," simply aren't true for Class III devices. There is little justification for having the devices regulated in two different ways by two different bodies: federal regulators applying one set of standards, and state-law-applying juries, applying different sets of standards.

Justice Ginsburg pointed out the flaw in the system: it only works if the federal regulation works. Sad to say, there have been numerous medical devices that received regulatory approval that turned out to injure thousands of people. If the federal regulators drop the ball (and especially if the manufacturer knew it), and thousands of citizens were injured or killed as a result of a badly designed device that was allowed to enter the market because of shoddy regulation, how on Earth could a result so hostile to the consumer be justified?

[Brown]

In the interest of disclosure, I said in this thread (http://forums.randi.org/showthread.php?p=856214#post856214) that several things could be done in the area of tort reform, but that little Bush was missing the point, big time. What can be done? First, limit punitive damage awards. Second, make class action lawsuits for damages MUCH more difficult to bring. Third, liability based upon scientific or technical grounds beyond the knowledge of lay people should be reviewed by a court-appointed expert. Fourth, allow regulated companies the opportunity to defend themselves based upon compulsory regulation. (The bill pending in Congress, when I last checked, would make this a complete defense, but only for drug companies. Bad approach.) Fifth, scale back indemnity rights in work-related injury cases. Sixth, don't dole out sweetheart protections to big contributors; don't make others pay for their wrongs.

Chances are that we won't hear little Bush pushing other approaches, probably because he he simply doesn't understand the subject matter. (emphasis added)

I also should disclose that Medtronic is a former client of mine, although not with respect to this lawsuit, or this product, or this regulation, or anything related to this Supreme Court opinion.

[JoeEllison]

Justice Ginsburg pointed out the flaw in the system: it only works if the federal regulation works. Sad to say, there have been numerous medical devices that received regulatory approval that turned out to injure thousands of people. If the federal regulators drop the ball (and especially if the manufacturer knew it), and thousands of citizens were injured or killed as a result of a badly designed device that was allowed to enter the market because of shoddy regulation, how on Earth could a result so hostile to the consumer be justified?

Did you miss the memo? The government is allied with corporations against consumers, and has been for years. All this "tort reform" garbage means one thing, and one thing only: Screw Americans, the corporation is king.

[DanishDynamite]

Perhaps limiting liability in general would not be a bad thing.

[JoeEllison]

Perhaps limiting liability in general would not be a bad thing.

Why, so that corporations can act with complete immunity?:rolleyes:

[Brown]

Did you miss the memo? The government is allied with corporations against consumers, and has been for years. All this "tort reform" garbage means one thing, and one thing only: Screw Americans, the corporation is king.Since I moved to Canada, the memos have stopped coming on a regular basis.

Of course, my six proposals aren't geared to stick it to the average citizen. But then again, my six proposals are not being talked about on the political stage, either. How curious that the High Court effectively implemented one of them! True, the Court said that Congress had actually implemented it (and a Congress controlled by the Democratic Party at that), although there is some question as to whether Congress knew that that is what it was doing. Justice Stevens, who was appointed to the Court in that very era, had this to say:The significance of the pre-emption provision in the Medical Device Amendments of 1976 ... was not fully appreciated until many years after it was enacted. It is an example of a statute whose text and general objective cover territory not actually envisioned by its authors. In such cases we have frequently concluded that "it is ultimately the provisions of our laws rather than the principal concerns of our legislators by which we are governed."
...
There is nothing in the preenactment history of the MDA suggesting that Congress thought state tort remedies had impeded the development of medical devices. Nor is there any evidence at all to suggest that Congress decided that the cost of injuries from Food and Drug Administration-approved medical devices was outweighed "by solicitude for those who would suffer without new medical devices if juries were allowed to apply the tort law of 50 States to all innovations." ... As JUSTICE GINSBURG persuasively explains, the overriding purpose of the legislation was to provide additional protection to consumers, not to withdraw existing protections. It was the then-recent development of state premarket regulatory regimes that explained the need for a provision pre-empting conflicting administrative rules.Justice Steven is returning to a theme similar to that discussed in an earlier thread, Justice Stevens Fires a Shot Across the Bow (http://forums.randi.org/showthread.php?t=35629). It may be that Justice Stevens is once again tweaking Justice Scalia, who is fond of sticking by the intent of the original drafters (as Scalia perceives it) of constitutional provisions or legislation.

[DanishDynamite]

Why, so that corporations can act with complete immunity?:rolleyes:
So that America could join the rest of the civilized world. Ridiculous lawsuits and having 5 times more lawyers per capita than anywhere else, could be a thing of the past.

[Brown]

So that America could join the rest of the civilized world. Ridiculous lawsuits and having 5 times more lawyers per capita than anywhere else, could be a thing of the past.That the USA has too damn many lawyers is, I think, hard to deny.

But I do not think you mean to suggest (and I do not think you actually do suggest) that the Riegel family's lawsuit was in any way "ridiculous."

[JoeEllison]

So that America could join the rest of the civilized world. Ridiculous lawsuits and having 5 times more lawyers per capita than anywhere else, could be a thing of the past.

That's an inaccurate description of the situation. But, hey, thanks for playing.:rolleyes:

[Beerina]

Democrats love lawsuits because trial lawyers are one of their biggest contributors (the more laws, the more that people can sue over, go figure). Hence the "problem" of "too many lawyers" must be minimized by those of liberal bent in the US.

[Brown]

Democrats love lawsuits because trial lawyers are one of their biggest contributors (the more laws, the more that people can sue over, go figure). Hence the "problem" of "too many lawyers" must be minimized by those of liberal bent in the US.This is a wee oversimplification. There are trial lawyers who devote most of their careers to defending civil lawsuits, and they are not necessarily supporters of Democrats. Indeed, the kind of cases in which lawyers specialize is not necessarily indicative of political affiliation.

And it's not necessarily "more laws" that causes the problem of too much suing. In many cases, people sue because that's all they know how to do.

This problem is a two-way street, however, and it's not fair to lay all the blame at the feet of plaintiffs (or the plaintiffs' bar). There are quite a few individuals and companies out there who simply will not do the right thing unless they are sued.

[Brown]

Further developments, from the New York Times (http://www.nytimes.com/2008/02/21/washington/21device.html?em&ex=1203742800&en=248c1b27a15bff47&ei=5087%0A):Crucial Democratic lawmakers appear to agree with Justice Ginsburg, including Senator Edward M. Kennedy, Democrat of Massachusetts, who heads the Health, Education, Labor and Pensions Committee and was the sole Senate sponsor of the 1976 legislation in question.

“In enacting legislation on medical devices, Congress never intended that F.D.A. approval would give blanket immunity to manufacturers from liability for injuries caused by faulty devices,” Mr. Kennedy said in a statement. He added: “Congress obviously needs to correct the court’s decision.”

Representative Henry Waxman, the California Democrat who is chairman of the House Committee on Oversight and Government Reform and was on the House panel that approved the 1976 bill, expressed a similar view.

“The Supreme Court’s decision strips consumers of the rights they’ve had for decades,” Mr. Waxman said. “This isn’t what Congress intended, and we’ll pass legislation as quickly as possible to fix this nonsensical situation.”Leaving aside that any such legislation would be vetoed during the term of the current president, both Senators Kennedy and Waxman ought to educate themselves a bit.

Let's start with Sen. Kennedy's remark about "blanket immunity to manufacturers from liability for injuries caused by faulty devices." The immunity is not total. If there is a defect in the manufacture of the device, then the manufacturer is still subject to suit. As it happens, the Riegel family made this very allegation, and it was deemed not preempted. They lost on this ground, however, because they had no proof to support it. From a footnote in the Court's opinion:The District Court later granted summary judgment to Medtronic on those claims of Riegel it had found not pre-empted, viz., that Medtronic breached an express warranty and was negligent in manufacturing because it did not comply with federal standards. ... The Court of Appeals affirmed these determinations, and they are not before us.The Riegels were left with asserting that Medtronic acted wrongly in the design and labelling of the device, and these are the very issues that are heavily regulated.

There is a big difference between a suit based upon a defect in manufacturing and a suit based upon defect in design. (Many product liability suits assert both.) A defect in manufacturing is one which shows up in a product that doesn't live up to specifications. Maybe this particular device has a loose gasket, or a cracked screw or brittle connector. A device that is made to specification would not have those problems, but this particular device does, and it is this defect in the manufacturing that led to the device's failure.

A design defect is different. When the defect is alleged to be a design defect, that means that every product of this kind is defective, even it is made perfectly and up to spec. Why is it defective? Because the design of the product is what's allegedly wrong with it. (A classic example: A few years ago, a certain auto manufacturer deployed its fuel tanks behind the vehicle's rear bumper, and these fuel tanks tended to explode or cause serious fires in rear-end collisions. This was a flaw in the design of the car, not its manufacture. Every car could have been made 100 percent to spec and still have been dangerously defective.)

It was the Riegel's design-based allegations that were preempted, because the design of the device is what is heavily regulated. The Riegels also asserted that the labelling was bad, but labelling of the device is heavily regulated, too. Medtronic couldn't change either the design or the labelling, even if it wanted to, without approval from the regulators.

So what, Senator Waxman, is so nonsensical about protecting medical device manufacturers from conflicting legal burdens? Are you and Senator Kennedy seriously going to push through a law that puts medical device providers in a damned-if-they-do-damned-if-they-don't position? If you want to optimize both safety and efficacy of Class III devices, isn't the best choice to take advantage of the time consuming (not to mention expensive) process of educated regulation, rather than have the devices second-guessed ad hoc by uneducated juries? (I used the term "educated" here to refer to the agency expertise in matters of physiology, anatomy, pharamacology, materials, engineering systems, biomedical modelling, testing, in vitro and in vivo analysis, hydraulics, electronics and the like ... education that comes from studying for several years, if not decades. This is a level of education that juries do not and cannot have.)

Further, how do you respond to Justice Scalia's observation that matters of safety and effectiveness (and the balance between them) cannot be effectively addressed in a courtroom? Are you going to elevate safety above all? That's not realistic. The safest knife in the world is the one that won't cut. Medical devices have to be designed to take both safety and efficacy into account, and the simple fact is that sometimes making a device safer makes it less effective.

Lest you think I am being too hard on the Democrats here, let me say that these boys seem to have shot from the hip, criticising the decision without actually having read it or analyzed it. They might come to their senses when they actually start trying to draft legislation to overturn this opinion.

Also, Republicans did not make this sort of tort reform central to their actions, preferring instead to propose measures that are, well, pretty damn stupid. If the time ever comes that little Bush slaps a veto on the legislation urged by Sens. Waxman and Kennedy, he is likely to once again reveal his jaw-dropping ignorance of the subject of "tort reform."

[Brown]

Justice Ginsburg pointed out the flaw in the system: it only works if the federal regulation works. Sad to say, there have been numerous medical devices that received regulatory approval that turned out to injure thousands of people. If the federal regulators drop the ball (and especially if the manufacturer knew it), and thousands of citizens were injured or killed as a result of a badly designed device that was allowed to enter the market because of shoddy regulation, how on Earth could a result so hostile to the consumer be justified?From today's New York Times (http://www.nytimes.com/2008/02/27/business/27cnd-device.html?_r=1&hp&oref=slogin):A ranking member of the Senate Finance Committee [Sen. Charles E. Grassley, R-IA] has asked the Food and Drug Administration and the maker of an artificial spinal disk about potential financial conflicts of many of the doctors involved in the clinical research that led to F.D.A. approval of the device.
...
"Clinical investigators play a critical part of the F.D.A. approval process," Mr. Grassley wrote in the letters to the F.D.A. and Synthes. "These physicians are expected to act objectively in testing the safety and effectiveness of the drug or medical device under consideration. But when they stand to profit from F.D.A. approval of the product they are testing, the investigator’s objectivity is called into question...."

[DanishDynamite]

That the USA has too damn many lawyers is, I think, hard to deny.

But I do not think you mean to suggest (and I do not think you actually do suggest) that the Riegel family's lawsuit was in any way "ridiculous."
I did not mean to suggest that, as you say. But if it could be shown that "the device failed because it had been used beyond its tolerance", then this case would enter that file of "ridiculous", yes.

[BenBurch]

I wonder if this will bleed over into the nuclear industry where there almost no liability on the part of operating companies because of regulation?

[Kopji]

Congresses reasoning is humorously hypocritical considering that they do not consider it unethical for themselves to benefit from laws that they sponsor and vote for. By the same logic, many of our laws are bad in the same way - benefiting the pockets of some already rich old politicians.

I am somewhat unsympathetic to the families pov. Why not eliminate federal regulation entirely and leave it up to each state? New York could then do what they want, otherwise they are being parasites by raising the costs for everyone else who does not benefit.

Companies could sell medical devices in a more free market. If someone wanted to take the risk, they could have the operation in a state with fewer regulatory laws.

But if the idea of federal regulation is to provide a basic safety net, maybe it should work both ways, protecting a company as well as the consumer. Is that so outrageous?

[SezMe]

Democrats love lawsuits ...

This is a wee oversimplification.

That is a wee understatement.

[JoeEllison]

That is a wee understatement.

It is, in fact, a statement full of "wee."

[Brown]

I did not mean to suggest that, as you say. But if it could be shown that "the device failed because it had been used beyond its tolerance", then this case would enter that file of "ridiculous", yes.I don't know if it really rises to that level.

Look at it from the Riegels' perspective. Mr. Riegel was completely vulnerable. He himself was certainly not at fault, and he had no chance to protect himself. There was no question that the device failed and that he was hurt by the failure. Ordinarily devices should not fail when they are used as intended, even if used in manners not foreseen. The Riegels could infer from this series of facts that someone may have been at fault, but they would need to investigate who it might have been.

Was the doctor at fault for using the instrument the wrong way? Was the hospital at fault for not storing it properly or inspecting it? Was the company that made the instrument at fault for making a dangerously defective product? The Riegels couldn't know for sure (and it is possible that they would be unlikely to find out unless they sued).

In the course of discovery (the compulsory information exchange that occurs after a lawsuit is filed), they may have learned that the device was used in a manner beyond its tolerance. From the Court's opinion:Charles Riegel underwent coronary angioplasty in 1996, shortly after suffering a myocardial infarction. His right coronary artery was diffusely diseased and heavily calcified. Riegel's doctor inserted the Evergreen Balloon Catheter into his patient's coronary artery in an attempt to dilate the artery, although the device’s labeling stated that use was contraindicated for patients with diffuse or calcified stenoses. The label also warned that the catheter should not be inflated beyond its rated burst pressure of eight atmospheres. Riegel's doctor inflated the catheter five times, to a pressure of 10 atmospheres; on its fifth inflation, the catheter ruptured.The opinion does not disclose the status of any lawsuit against the doctors for using the wrong device, or for using the device beyond its recommended limits.

There is a long line of jurisprudence to the effect that patients undergoing medical procedures are often not in any position to protect themselves, nor are they in any position to know what happened if something goes wrong. The Riegels certainly had no way of knowing what instrument was used, what its labeling was, or how it was applied. There is also a long line of jurisprudence to the effect that a mere use of a product other than that specified in the instructions does not necessarily get a manufacturer off the hook; a manufacturer cannot insulate itself from liability by listing a narrow list of "intended uses" in its fine print, and a manufacturer can be liable when its product fails during a foreseeable misuse.

In addition, the Riegels reasonably believed the law was on their side. Preemption had not been conclusively established in the courts (and several case authorities actually went the other way).

This all adds up to the fact that the Riegel's suit was, when they brought it, reasonable. I doubt one could find a judge anywhere in the US who would disagree.

Nor was it ridiculous to maintain the suit, even after discovery showed that the product had been used beyond its tolerance. The Riegels had at least a colorable case that the law was on their side.

Even though they lost, the Riegels' suit was supported by fact and law. The suit was not frivolous. And the fact that they lost does not mean that their suit was ridiculous.

[Brown]

That is a wee understatement.Oui.

[Brown]

This week, in the case of WARNER-LAMBERT CO. v. KENT (http://www.supremecourtus.gov/opinions/07pdf/06-1498.pdf), the Supreme Court ruled as follows:The judgment is affirmed by an equally divided Court.Chief Justice Roberts did not participate. The vote was 4-to-4, but we don't know how those eight votes were arrayed. (Conventional wisdom is that Justices Scalia, Kennedy, Thomas and Alito were on one side, and Justices Stevens, Souter, Ginsburg and Breyer were on the other. But conventional wisdom might be wrong.) We do not know why the Chief Justice sat this case out. But we do know that because there was no majority, the lower court's decision is automatically affirmed, and the Supreme Court issued no opinion one way or other on the legal questions.

Why is this important? The issue in the case was in some respects similar to the issue in the case discussed above. Questions exist about pre-emption in light of a drug manufacturer's dealings with the FDA, and whether state law can provide consumers a remedy.

The issues were a bit different than the case discussed above, and I won't go into the differences now. (Nor will I go into detail about other cases waiting in the wings, dealing with related issues.) I found it interesting though, that during oral argument Justice Breyer asked the following question of the plaintiffs' lawyer. Does this question sound familiar?Now, who would you rather have make the decision as to whether this drug is, on balance, going to save people or, on balance, going to hurt people? An expert agency, on the one hand, or 12 people pulled randomly for a jury role who see before them only the people whom the drug hurt and don't see those who need the drug to cure them?

[dogjones]

Damn, less reasons to buy liability insurance. In a softening market too... repeal it!

[Brown]

Justice Ginsburg pointed out the flaw in the system: it only works if the federal regulation works. Sad to say, there have been numerous medical devices that received regulatory approval that turned out to injure thousands of people. If the federal regulators drop the ball (and especially if the manufacturer knew it), and thousands of citizens were injured or killed as a result of a badly designed device that was allowed to enter the market because of shoddy regulation, how on Earth could a result so hostile to the consumer be justified?According to a recent story in the New York Times (http://www.nytimes.com/2009/09/25/health/policy/25knee.html?scp=2&sq=fda&st=cse), regulation failed. The Food and Drug Administration said Thursday that four New Jersey congressmen and its own former commissioner unduly influenced the process that led to its decision last year to approve a patch for injured knees, an approval it is now revisiting.

The agency's scientific reviewers repeatedly and unanimously over many years decided that the device, known as Menaflex and manufactured by ReGen Biologics Inc., was unsafe because the device often failed, forcing patients to get another operation.

But after receiving what an F.D.A. report described as "extreme," "unusual" and persistent pressure from four Democrats from New Jersey — Senators Robert Menendez and Frank R. Lautenberg and Representatives Frank Pallone Jr. and Steven R. Rothman — agency managers overruled the scientists and approved the device for sale in December.The device in question was not one of the life-critical medical devices. It was a "C-shaped pad used to repair a torn or damaged meniscus" in the knee. Medical devices generally are supposed to be safe and effecitve, and clinical trials indicated that the device was not effective. In addition the device was not safe in that the patient would need repeated surgery when the device failed, as it often did.

The legislators all received significant campaign contributions from the maker of the device (surprise!) and they all denied that these contributions had anything to do with their efforts to try to sway the regulatory agency (double surprise!!).

[ponderingturtle]

[QUOTE=Brown;5146232
The legislators all received significant campaign contributions from the maker of the device (surprise!) and they all denied that these contributions had anything to do with their efforts to try to sway the regulatory agency (double surprise!!).[/QUOTE]

This is exactly how the system is supposed to work though. The company bought legal protection and they clearly deserve what they payed for.

[Beerina]

Ginsburg: It only works if the federal regulation works.

Yes, but the nature of the Constitution is basically, "so what?" "Congress is authorized to pass laws on such and such", which includes, apparently, the power to provide, legally, a sufficient and necessary set of regulations which, if met, waive the ability to sue.

So the question is: How do you discover, in the Constitution, that Congress' power does not, in fact, extend that far? Especially given the power to regulate interstate commerce, as well as to set the domain of the courts?

I don't argue the Interstate Commerce clause necessarily extends this far, but the "left" does, relying on it even more than they do the "general welfare" clause, for enabling the Long Arm of Congress.

Pick your outcome, then backfill with rationalization. Nothing new to see here, folks. Move along, move along...