SUMMER/FALL 2019
PRODUCT LIABILITY A quarterly magazine on emerging developments, decisions, and defenses in professional- negligence law and claims management
TRYING a KILLER DRUG Page 8
ALSO INSIDE: A Book Called NFPA 921 • Loose Handles Lead to Tighter Controls • Whom to Believe? Attorney Advertising
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SUMMER/FALL 2019
PRODUCT LIABILITY A quarterly magazine on emerging developments, decisions, and defenses in professional- negligence law and claims management
Contents SUCCESS STORY
PRODUCT LIABILITY PRACTICE GROUP CHAIR
4 | Turning a Case Around
David J. O’Connell doconnell@goldbergsegalla.com
Brought in to appeal a verdict in a trial in which it wasn’t involved, Goldberg Segalla won a heavy-equipment manufacturer another day in court—and this time the firm will defend the company
EDITOR
INSIGHTS
H. Lockwood Miller III hmiller@goldbergsegalla.com
CONTRIBUTORS Owen R. Field ofield@goldbergsegalla.com Lisa P. Gruen lgruen@goldbergsegalla.com Justin D. Kaplan jkaplan@goldbergsegalla.com M. Regina Phillips rphillips@goldbergsegalla.com Jennifer L. Rediehs jrediehs@goldbergsegalla.com Staci A. Williamson swilliamson@goldbergsegalla.com
5 | J&J’s Creative Attempt to Consolidate Nationwide Talc Cases 6 | Will the Middleman Get Stuck with the Bill? In Pennsylvania, apportionment of liability in the chain of distribution 7 | A Book Called NFPA 921 Attorneys handling fire cases must know their way around the ‘Bible for forensic fire-scene investigation’ COVER STORY
8 | Trying a Killer Drug Opioid-related lawsuits are on the rise, and they’re testing both old and novel theories CASE NOTE
11 | Loose Handles Lead to Tighter Controls A product-safety case prompts a resounding court ruling SPOTLIGHT
12 | Whom to Believe?
MANAGING EDITOR Robert L. Kaiser
New Jersey, Florida align themselves with stricter standard for expert testimony CROSSOVER
COPY EDITOR
14 | Judge Throws Out Former-NFL Player’s Workers’ Compensation Claim
Nicolette Clark
Closing Argument Wins the Day in Liability Case Involving Injured Woman
CHIEF DESIGNER Jeremy Dolph
Cover Photo: GettyImages
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SUCCESS STORY
Turning a Case Around Brought in to appeal a verdict in a trial in which it wasn’t involved, Goldberg Segalla won a heavy-equipment manufacturer another day in court—and this time the firm will defend the company. The New York Court of Appeals has ordered a new trial for a global heavy-equipment manufacturer that a Queens County jury found liable in the death of a man crushed by a tree while operating a rented front-bucket loader. Defending the manufacturer this time will be Goldberg Segalla partners David S. Osterman and Matthew G. Miller. Though the firm was not involved in the case at the time of the first trial or a failed first appeal, it was retained to pursue a second appeal and turned the case around with two important legal victories on behalf of the heavy-equipment manufacturer: David, Brendan T. Fitzpatrick, and Neil A. Goldberg successfully sought leave to take the case to the Court of Appeals, which happens only about three percent of the time. Then Brendan, the lead attorney on the appeal, successfully argued that the lower court erred by straying from case law known as the Scarangella defense; the Court of Appeals reversed what happened at the trial and ordered a new one. The Scarangella defense is named for the case of Scarangella v. Thomas Built Buses, Inc., in which a school-bus driver and her husband, in response to her being struck and injured by a school bus in September 1988, sued the bus manufacturer for negligence, breach of warranty, and products liability. At issue was whether the bus that hit 48-year-old Concetta Scarangella should have been equipped with an alarm to signal that it was backing up. The bus that struck Scarangella was one of 10 new school buses that Thomas Built sold Huntington Coach Corporation in 1988. At the time,
4 | Product Liability Playbook
Thomas offered buyers as an optional safety feature a back-up alarm that automatically would sound when a driver shifted the bus into reverse. But Huntington opted not to buy the alarm feature because, according to testimony by Huntington’s president and chief operating officer, the alarm “screams,” and the buses would be parked in a neighborhood whose residents had complained to him of noise pollution. Scarangella, which ended in a July 1999 Court of Appeals ruling in favor of the bus manufacturer, gave rise to a defense that has been used again and again: If a person makes an informed decision not to buy a safety accessory with a product that can safely be used without it for some applications, the manufacturer cannot later be held liable if the device’s absence is alleged to be a design defect that caused the person’s injury or death. The Scarangella defense is important for manufacturers of heavy equipment, which is designed to be easily modified to suit many uses and customers. But the case of the front-bucket loader, whose user was crushed to death by a nine-foot tree he was removing from the ground after he opted not to rent accessory parts of the machine that would have formed a protective Plexiglass enclosure around him, diverged from the precedent-setting bus-driver case. The trial judge accepted the plaintiff’s argument that Scarangella shouldn’t apply to products sold into the rental market and the jury found both the manufacturer and the rental store liable, each for half of $1 million in damages. Though the rental store didn’t appeal the
verdict, the manufacturer did. But the Appellate Division Second Department affirmed the trial court outcome with a 10-page decision that changed state law. It was soon thereafter that the heavy-equipment manufacturer retained Goldberg Segalla, which it had worked with before, setting the stage for Brendan, David, and Neil to induce a May 9, 2019, Court of Appeals decision that “no such ‘rental market’ exclusion from Scarangella … is appropriate.” Defending the bus manufacturer at the second trial will be David, a trial lawyer who concentrates his practice in handling complex civil actions and class action litigation, and Matthew, a highly experienced trial attorney who focuses his practice on general liability, construction litigation, and product liability. Goldberg Segalla is recognized as a leader in product liability litigation and risk avoidance. Attorneys in the firm’s Product Liability practice group work together as a single integrated team, with the sole purpose of helping our clients win or avoid product liability disputes. They’ve tried product liability cases on behalf of Fortune 500 companies throughout the United States. Goldberg Segalla’s Appellate practice groups also showcases what makes the firm different. Much more than a last line of defense, Goldberg Segalla’s appellate attorneys very often are key partners from the initial stages of litigation, bringing a unique skill set, trial assistance, formidable writing talents, and a global perspective to every matter.
INSIGHT
J&J’s Creative Attempt to Consolidate Nationwide Talc Cases BY M. REGINA PHILLIPS Recently, Johnson & Johnson (J&J)—one of the most-recognizable companies in the world—has found itself the target of numerous product liability actions across the nation, defending itself against claims by plaintiffs alleging that J&J products caused them to develop cancer. Overwhelmingly, the cases have been brought by women who have developed ovarian cancer, but there also is a spate of cases that claim J&J’s products caused the plaintiff to develop mesothelioma. As of its most recent SEC filing, J&J is reporting that 11,700 talc cases have been commenced against the company, seeking some measure of compensatory and punitive damages. Thousands of cases involving ovarian cancer claims have been consolidated as a Multi-District Litigation (MDL) proceeding under the direction of Judge Freda Wolfson and Judge Lois Goodman in the District Court of New Jersey. In addition, there are approximately 2,400 cases—some involving ovarian cancer and others involving mesothelioma—that have been commenced in various state courts across the nation.
Jurisdiction of U.S. district courts is governed by Title 28, Section IV, Chapter 85 of the U.S. Code. Section 1334 specifically addresses in what court bankruptcy proceedings may be held. U.S. district courts have “original and exclusive jurisdiction” over all cases brought under title 11. District courts may also have “original, but not exclusive jurisdiction” over civil cases that arise under title 11, or that are related to cases proceeding under title 11. Essentially, district courts have jurisdiction over bankruptcy proceedings, and they may elect to have jurisdiction over civil actions, if those actions are in some way related to the bankruptcy. In its removal papers, J&J indicated that it maintained shared insurance with Imerys, and that an indemnification agreement and contractual provisions relating to liability sharing existed between the parties. Using the shared insurance and contractual provisions as the basis, J&J argued that the plaintiffs’ claims in the talc cases were “related” to the Imerys bankruptcy, and thus that the various state-court cases should be removed to federal court.
In February 2019, J&J’s primary outside talc supplier, Imerys, filed for Chapter 11 Bankruptcy protection in the U.S. Bankruptcy Court for the District of Delaware. Citing talc litigation as the impetus for their filing, Imerys sought the protection of the bankruptcy court to manage the burden caused by this litigation. As a result of this filing, all talc-related claims commenced against Imerys were stayed.
After beginning the process of removing all state court to federal court, J&J also filed a motion in April 2019 to fix venue in the U.S. District Court for the District of Delaware. With that filing, J&J sought leave to have all state and federal court civil actions involving talc claims be transferred to the District Court in Delaware for resolution. At the end of April 2019, J&J further filed an emergency motion for provisional transfer, seeking to have all personal injury and wrongful death talc actions pending against J&J provisionally transferred to the District Court of Delaware while a decision on the motion to fix venue remained outstanding.
Following this filing by Imerys, J&J began filing Notices of Removal in April 2019 in state courts across the nation, seeking to have nearly all state-court talc-related cases removed to federal court. J&J argued that all talc cases were “related to” the Imerys bankruptcy, making federal court the proper jurisdiction for all the pending cases.
Following these filings, district court judges across the country who found these J&J talc cases on their respective dockets began evaluating the merits of J&J’s removal gambit. In one of the first judicial determinations, Judge Colleen McMahon of the Southern District of New York, and with the permission of the other Southern District judges to whom a J&J talc
case had been assigned, issued an order “in the interest of justice” staying all 26 actions removed to the Southern District of New York. Shortly thereafter, she instructed all parties affected by the transfer that applications to remand the actions need not be filed until after the District of Delaware ruled on J&J’s motion to fix venue. On May 9, 2019, Judge Maryellen Norieka, the presiding judge in the District of Delaware, denied J&J’s application seeking a provisional transfer of all cases. Judge Norieka determined that J&J had not satisfied the burden necessary to support removal. Specifically, Judge Norieka found that J&J had not made a showing that it would be irreparably harmed absent the requested relief, was not a debtor in the bankruptcy, and had not established its own fiscal distress. Additionally, Judge Norieka concluded that no “emergency” existed for which the drastic relief sought by J&J needed to be granted. He explained that 28 USC 157(b) allows the court overseeing the bankruptcy to fix venue despite any decision reached by other state and federal courts, so no emergency existed that required imminent action by the District of Delaware. Judge Norieka further determined that J&J’s purported emergency came about by J&J’s own actions, as it controlled the number and timing of the removal motions filed. Following this decision by Judge Norieka, Judge McMahon lifted the stay on the 26 cases removed to the Southern District of New York, and set an expedited briefing schedule to allow the parties to address J&J’s removal applications via motion to remand. As 28 USC 1452(b) governs motions to remand, Judge McMahon turned to the 1991 case Drexel Burnham Lambert Grp., Inc., v. Vigilant Ins. Co. to review the factors used to determine whether to remand a case. Judge McMahon concluded that three factors cited within the Drexel case—the application of state law to the subject talc cases, a recognition of comity and the prejudice that would flow to the plaintiffs—strongly favored that the cases be remanded to the courts of original jurisdiction. ‘Talc’ continued on page 10
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INSIGHT
Will the Middleman Get Stuck with the Bill? In Pennsylvania, apportionment of liability in the chain of distribution BY OWEN R. FIELD From the manufacturer to the distributor to the retailer, most products pass through numerous hands before reaching the consumer. If a defect causes an injury, the obvious target is the manufacturer. But what if the manufacturer is unknown, bankrupt, broke, or unavailable? In states like Pennsylvania, the whole chain of distribution can be strictly liable as “sellers” that put a defective product into the stream of commerce. Traditionally, each could be responsible for an equal share of all of the damages, much like handing a waiter a stack of credit cards to cover a bill, regardless of how much each individual cardholder ate. Strict liability is a “no fault” concept with the rationale that a consumer is most protected when all sellers must sell defect-free products regardless of whether they exercised due care. Bankrupt defendants were often disregarded, leaving more to shoulder for those companies still standing. (See Ottavio v. Fibreboard Corp.) In 2011, Pennsylvania passed the Fair Share Act, making each defendant liable only for its jury-decided percentage of liability (with some exceptions). Courts thereafter remained unsettled on whether the Fair Share Act applied to certain strict liability defendants. In 2014, the Pennsylvania Supreme Court issued Tincher v. Omega Flex, Inc., holding that negligence principles have a place in strict liability, rejecting that sellers are absolute “guarantors,” and requiring that sellers be reasonable in balancing the risk of harm and the costs of taking precautions.
6 | Product Liability Playbook
Tincher presented unique challenges for asbestos cases in which claimants are often exposed to dozens of products over many years. In Roverano v. John Crane, Inc., the Superior Court (intermediate appellate) denied asbestos cases a “pass” on the Fair Share Act and remanded the case for the jury to determine the comparative fault of each defendant.
port the sweeping reach of the Fair Share Act in Roverano may bring fairness to sellers in the chain with the least involvement in any alleged defect, and will allow defendants to share the verdict sheet with certain bankrupt entities. This approach could develop alongside Tincher, making a risk utility analysis more dynamic and opening the door to new defenses.
Roverano, an electric company worker, was exposed to a variety of asbestos products from 1971 to 1981 and developed lung cancer in 2013. At trial, the jury was charged with determining only if Roverano was exposed to asbestos from each defendant, and whether such exposure caused his lung cancer. Eight defendants were left standing on the verdict sheet and each was stuck with a one-eighth hit of a $6.4 million verdict. The defendants contended that liability could and should be apportioned under the Fair Share Act, while the plaintiff responded that doing so would always be speculative. The Superior Court vacated the verdict, holding that the Fair Share Act mandates the factfinder to allocate liability among joint wrongdoers based on appropriate evidence. Accordingly, the Roverano court also directed that settled bankrupt defendants be on the verdict sheet to be apportioned fault.
Or, the Supreme Court could uphold the traditional approach, possibly limiting the holding to asbestos cases (which would continue the uncertainty for the rest). If multiple strict-liability defendants are subject to per capita apportionment, it would be consistent with Pennsylvania’s refusal to adopt middle-man defenses such as the “innocent seller” or the “sophisticated user” doctrines, and refusal to protect sellers of used products against strict liability claims. (See Frey v. Harley Davidson Motor Co.)
This year, the Pennsylvania Supreme Court heard arguments on the plaintiff’s appeal of Roverano, and a decision is expected soon. The implications for all strict-liability defendants are profound. Claims against defendants in a chain of distribution present similar challenges as those against asbestos defendants in that distinct conduct is hard to quantify, and developing theories of apportionment may require thoroughness and creativity. A ruling to sup-
Chain-of-distribution clients defending products in Pennsylvania should be advised of the current unknowns and provided with alternative evaluations based on possible outcomes of the Pennsylvania Supreme Court’s decision. Joining new parties should be encouraged, regardless of their financial exposure, and discovery should focus on increasing the comparative fault of other parties. For many deep-pocketed middle-man companies, a decision for the Fair Share Act could significantly reduce exposure. On the other hand, if a traditional, “per capita” approach is upheld in strict liability, the seller could get stuck with the bill. Owen R. Field’s practice focuses on defending product liability claims and handling catastrophic injury cases in transportation.
INSIGHT
A Book Called NFPA 921
Attorneys handling fire cases must know their way around the ‘Bible for forensic fire-scene investigation.’ BY JENNIFER L. REDIEHS I went to my first fire scene within the first month of being employed as an attorney. My boss handed me a copy of NFPA 921 and told me to read it. NFPA 921 is the National Fire Protection Association’s Guide for Fire and Explosion Investigations, and it can be the difference between winning and losing a case. If you anticipate handling fire cases in your career, you must be familiar with NFPA 921. If you will be handling many fire cases, you should know it well enough that you can easily find the section you’re looking for when under pressure.
I do not think my boss who told me to read NFPA 921 my first week as an attorney meant I should read it cover to cover, that’s exactly what I did. At first, the guide was more confusing than useful. Reading it, I was a bit lost. There are a lot of technical terms, and I had zero background in fire investigation.
version, published in 1992, had fewer than 20 chapters. The next edition of NFPA 921 is in the works and is scheduled to be released in 2021.
But, even though I did not understand much on that first read of NFPA 921, that book set a foundation for my career. It was interesting—a niche area I thought could be fun to explore. And today, eight years into my career, I understand the majority of what is in the guide.
Most attorneys should start with Chapter 17 when handling a so-called young fire claim.
NFPA 921 isn’t just a guide for fire professionals. It’s a roadmap for an attorney from the initial investigation of a fire through discovery and trial.
Courts have repeatedly held that NFPA 921 is an acceptable peer-reviewed authoritative work and generally accepted in fire-investigation communication. One court called it “the Bible for forensic fire-scene investigation.”
From the beginning of my career, I have been involved with the investigation of fire losses. While
The most recent iteration of NFPA 921 was published in 2017 and has 30 chapters. The original
Which sections of NFPA 921 are especially important for an attorney to read and understand to best assist clients in the pursuit or defense of fire claims?
In an ideal world, a client will call you immediately after a fire occurs and you can demand preservation of the fire scene and evidence pending an official investigation. Chapter 17 addresses preservation of the fire scene and physical evidence as well as considerations in documenting the scene and collecting physical evidence. As I am usually on the defense side of the aisle, I always send correspondence to the claimant’s attorney or representative referring to Chapter 17 and demanding preservation of the scene and ‘NFPA’ continued on page 10
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COVER STORY
TRYING a KILLER DRUG
BY JUSTIN D. KAPLAN
Opioid-related lawsuits are on the rise, and they’re testing both old and novel theories.
8 | Product Liability Playbook
T
he trial this spring and summer of Johnson & Johnson (J&J), which faced allegations under Oklahoma’s
public-nuisance law for its alleged role in the opioid epidemic, was a zoom lens on a national crisis. “One pill can kill, right?” attorney Brad Beckworth asked J&J Regional Business Director, Kimberly Deem-Eshleman, when she took the stand. “Potentially,” Deem-Eshleman said. “You’ve known that since the beginning,” said Beckworth. “There is an abuse potential.” “And there’s a death potential, too.” J&J’s trial, which played out over seven weeks in a Norman, Oklahoma, courtroom this spring and summer, led a state judge to rule August 26 that the company had intentionally minimized the dangers and oversold the benefits of opioids. The judge ordered J&J to pay the state $572 million. It was a ruling that could affect other such claims. Though J&J’s was the first trial of a drug manufacturer over opioids, it almost certainly won’t be the last. There has been an explosion of lawsuits against manufacturers and others involved in the sale of opioids, and they’re testing both old and novel theories. While nuisance laws may normally conjure up thoughts of minor property disputes, opioid cases will test whether nuisance laws can take on more far-reaching issues. The rapid rise in opioid cases is hardly surprising given the costs associated with the opioid epidemic. According to the Substance Abuse and Mental Health Services Administration’s 2017 survey, 11.4 million Americans are misusing opioids. The economic impact is large. According to a 2013 article by the National Center for Injury Prevention and Control, Centers for Disease Control and Prevention, the economic burden of opioids is $78.5 billion. Not only is there an economic burden from the opioid epidemic, but, according to the CDC, 130 Americans die each day from an opioid overdose.
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The first opioid-related suit culminated in a partial settlement. The State of Oklahoma sued various parties, including Purdue Pharma, L.P., and J&J. Under the terms of the partial settlement, reached two months before the case was slated for trial, Purdue agreed to pay $270,000,000, including $75,000,000 that will be paid by Mortimer and Raymond Sackler, owners of Purdue. The settlement left J&J and subsidiaries as the sole remaining defendants, leading to that company’s trial this year. Currently, there are 2,000 cases filed by various state and local governments surrounding the opioid crisis. In fact, in late 2017, the Judicial Panel on Multidistrict Litigation consolidated federal cases concerning the prescriptions of opiate medication into multidistrict litigation. The first of these multidistrict litigation cases is set for trial on October 21, 2019. Given the magnitude of these cases, the court has allotted a significant amount of time for the trial, allowing the trial to proceed until December 13, 2019. In the multidistrict litigation, Judge Dan A. Polster denied a motion to dismiss the nuisance causes of action. In denying the motion to dismiss, Polster relied on the Restatement (Second) of Torts. Specifically, he noted the following: “[T]he Restatement states that, at common law, public nuisances included interference with the public health…. Thus, ‘public health’ has traditionally been considered a ‘public right.’ Further, [i]t should be noted that, in some states, there are statutes defining a public nuisance to include interference with ‘any considerable number of persons,’ and under these statutes no public right as such need be involved.” While Polster refused to dismiss the nuisance causes of action, what remains to be seen is whether these claims will ultimately prevail at trial. The first test is the State of Oklahoma’s claims against J&J followed by the first bellwether MDL trial later this year. The results will have significant impact on future opioid cases. The outcome could lead to settlements or spur more litigation. In any event, these first cases will impact hundreds, if not thousands, of cases with serious financial ramifications. Justin D. Kaplan focuses his practice on litigating product liability matters, complex commercial disputes, and insurance defense matters.
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‘NFPA’ continued from page 7
physical evidence until the parties can retain their own experts and conduct an origin and cause investigation of the scene. Origin-and-cause fire investigators will tell you that it is much easier to offer an opinion when they’ve been to a fire scene. Likewise, it’s much easier for attorneys to defend or pursue a fire case when they themselves have been to the scene or at least had it properly documented by an expert. Chapters 18 and 19 deal with determining the origin and cause of a fire. Both chapters have very helpful diagrams that illustrate the scientific method in determining both the origin and cause. You would be surprised at how many experts have been tripped up when confronted with these charts. When NFPA 921 was first published, there was a lot of pushback from members in the fire investigation community. Prior to NFPA 921, the fire investigation community was known to have many “fire-whisperers.” These were so-called experts who had no real scientific training and opined to origin and cause based upon subjective and speculative means. Now experts must be able to explain how they arrived at their conclusions based purely on science. No longer is “because I said so,” a valid
‘Talc’ continued from page 7
Other district courts have reached similar conclusions. For example, in the Central District of California, Judge Cormack Carney remanded 44 actions to state court for reasons substantially similar to those cited by Judge McMahon in the Southern District of New York. Carefully evaluating the “equitable ground” remand standard set forth in 28 USC 1452(b), Judge Carney compared the plaintiffs’ remand applications against the following factors established by the Central District of California Bankruptcy Court in 2003 while addressing the Enron bankruptcy:
opinion in a fire case. So it is imperative that, in a deposition or at trial, an attorney go over how the expert arrived at his or her opinion. In preparing experts for deposition or trial, be sure they can adequately explain their opinions and how they arrived at them scientifically. This helps experts demonstrate that their methodology and reasoning is scientifically valid and can be applied to the facts of the case, thus reducing the chances that their opinions will be excluded at trial. Many times, a fire case comes down to a “battle of the experts.” Whichever expert has a better explanation of just how he or she determined the origin or cause of a fire is likely going to win. In addition to chapters 17, 18, and 19, there are also helpful chapters near the beginning of NFPA 921. These provide definitions of many fire-related terms and phrases. There are also chapters that provide the basis for methodology and fire science. And some chapters are tailored for a specific type of fire. I recently watched a senior attorney, who had years of experience in fire investigation and a scientific background, try a case. When opposing experts introduced an entirely new theory at trial, this attorney was able to recall sections of
• The burden imposed on the bankruptcy court docket • The existence of a right to a jury trial • The feasibility of allowing judgments to be entered in state court while leaving enforcement to the bankruptcy court • The impact of remand on the administration of the debtor’s bankruptcy case • The possibility of prejudice to parties in the action.
• Comity and respect for state law; the degree of relatedness of the state proceeding to the bankruptcy case
After evaluating these factors against the applications for remand, Judge Carney concluded that the relevant factors weighed “strongly in favor of granting equitable remand.” As the actions relied entirely upon state tort law, many of the claims had been substantially litigated at the time they were removed, and the presiding state court judges had intimate knowledge of the issues and parties involved, Judge Carney found no basis for the cases to remain in the federal court other than J&J’s theory of “related to” jurisdiction.
• The likelihood that either party is forum shopping
As of this writing, it appears that all district courts that have rendered decisions on the
• The extent to which state laws predominate over bankruptcy issues • Whether the applicable law involves difficult or unsettled issues • Whether any basis for jurisdiction exists other than 28 USC 1334
10 | Product Liability Playbook
NFPA 921 that refuted it. He continued to use NFPA throughout his cross-examination of the experts and revisited it extensively during the closing statement. He did not solely rely on his experts to know the science of the case; he knew it himself and could convey the ideas in layman terms to the jury. The case involved an appliance fire, which happens to be the subject of an entire chapter of NFPA 921: Chapter 26, in the current edition. NFPA 921 has revolutionized fire investigation. The importance of the publication for an attorney defending or pursuing a fire case becomes more and more apparent each year. There are hundreds of state and federal cases that cite NFPA 921 in opinions, and that number will only grow. Courts call it the “gold standard” in the field of fire science. Fire and explosion investigation is an ever-evolving science, and it is not an area you can learn about once and rest on your laurels. If you are intimately familiar and comfortable with NPFA 921 and keep abreast of recent developments in the area, you give yourself an immeasurable advantage in any fire case. Jennifer L. Rediehs concentrates her practice in the defense of products.
merits of the plaintiffs’ remand motions have reached decisions similar to those reached by Judges McMahon and Carney. Accordingly, J&J’s creative attempt to use federal bankruptcy law to consolidate the pending talc cases against it in a single federal court proceeding—by claiming their cases were “related to” their talc supplier’s bankruptcy proceeding—appears not to have succeeded. In the eyes of the various courts tasked with evaluating the merits of J&J’s efforts, while shared insurance and contractual provisions did exist, those relationships did not trump perceived prejudice to the plaintiffs, the relevance of state law, and an overarching acknowledgement of comity. Still, J&J’s use of this theory may give defendants in future litigations, in which a key party seeks bankruptcy protection, insight into a possible procedural strategy to consolidate cases from state and federal courts. Regina Phillips predominantly defends cases involving allegations of medical malpractice, products liability, and general negligence.
United States v. Spectrum Brands, Inc., No. 18-1785 (7th Cir. 2019) CASE NOTE
Loose Handles Lead to Tighter Controls
A product-safety case prompts a resounding court ruling BY STACI A. WILLIAMSON Sometime in early 2009, the black-plastic handles on coffee carafes with Black & Decker’s SpaceMaker coffee machines started coming loose. Consumers complained, a customer was burned by a spill from one of the defective carafes, and Spectrum Brands, Inc., had a problem on its hands. Spectrum didn’t address the problem the way it should have, the Seventh Circuit decided this year, affirming that the company violated the Consumer Products Safety Act by waiting until April 2012 to report the defect. The court’s ruling extends the statute of limitations for continuing violations, affirms broad injunctions as remedies, and fires a warning shot: Consumer-product companies should have appropriate compliance procedures, because reporting delays won’t be tolerated and violations may lead to harsh injunctions and substantial civil penalties. The Spectrum case started as a civil prosecution for failure to timely report a suspected substantial product safety hazard. Spectrum is a global consumer products company based in Wisconsin. It distributes many consumer products, including the Black & Decker SpaceMaker coffee machine. As a purveyor of consumer goods, Spectrum is bound by the CPSA, which includes a duty to notify the CPSC of any suspected defect that poses a “substantial risk of injury to the public.” The duty to report is triggered whenever a manufacturer, distributor, or retailer of a consumer product “obtains information which reasonably supports the conclusion that such product contains a defect which … could cre-
ate a substantial product hazard … unless such manufacturer, distributor, or retailer has actual knowledge that the Commission has been adequately informed of such defect …” The regulations require a report to the CPSC within 24 hours of becoming aware of the potential hazard. Spectrum began receiving complaints about the SpaceMaker in February 2009. By April the company launched an internal investigation into the validity of the complaints. But, despite receiving hundreds of complaints, Spectrum failed to notify the CPSC of the reported defects. Over the next two years, the CPSC itself began to receive complaints regarding the coffee makers. It forwarded them to Spectrum. But not until April 2012, after the initiation of a classaction suit and more than 1,600 complaints, did Spectrum file a report with the CPSC. Two months later, Spectrum and the CPSC jointly announced a recall of the defective SpaceMaker machines. Due to gaps in its internal procedures, however, Spectrum continued to sell the defective machines until a second recall was issued in June 2013. Enforcement Litigation In June 2015, the government filed a civil complaint against Spectrum alleging failure to inform the CPSC of the defective SpaceMaker coffee machines for several years. The government sought civil penalties and injunctive relief. The district court imposed fines totaling approximately $3 million and a substantial injunction which, among other things, required Spectrum to implement a robust compliance program within six months of the order. The injunction was subsequently modified to include six specific measures, which included
documenting calls and communications regarding accidents, implementing a formal “Request for Corrective Action” procedure whereby engineers and safety managers could request changes to products and ensuring internal compliance training on the CPSA. The injunction was modified again at the request of the government, adding an additional requirement that Spectrum retain, at its own expense, “an independent expert, who, by reason of background, training and education is qualified to assist in reviewing and recommending changes, if necessary, to Spectrum’s comprehensive safety program . . . .” Finally, the injunction required that “Spectrum shall have 120 days to implement the recommendations made by that expert in good faith, unless… Spectrum files a written challenge in this court on the basis that it is unreasonable …” On appeal, Spectrum advanced two arguments: First, that the district court was not empowered to fine Spectrum based on the five year statute of limitations defense provided for in the CPSA, and second, that the broad injunction was an abuse of discretion. Statute of Limitations With respect to the statute of limitations defense, Spectrum argued that the statute of limitations began to run from the first incident which triggered Spectrum’s duty to report. By contrast, the government argued that Spectrum’s obligation to report was a continuing one; the implication of this is that the five-year statute of limitations would not begin to run until the report was finally filed. The Seventh Circuit ultimately rejected Spectrum’s argument, noting that “once a company has omitted to ‘ immediately’ inform the Commission of a potentially hazardous product defect, the elements of its statutory breach ‘Loose Handles’ continued on page 13
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SPOTLIGHT
Whom to Believe? BY LISA P. GRUEN Which expert witnesses measure up? For years, there have been two standards of admissibility —the relatively lenient Frye, established in the 1923 case of Frye v. United States, and the more stringent Daubert, from 1993’s Daubert v. Merrell Dow Pharmaceuticals. The Frye standard, which has been criticized as too vague and prone to “junk science,” says that for an expert’s opinion to be admissible it must be based on science “generally accepted” in the scientific community. Daubert requires more. According to that standard, the science behind an expert witness’s testimony must be not only generally accepted; it must also be testable and peer-reviewed and have a known potential-error rate. Until last year, all federal courts and 36 states followed the Daubert standard. But now, in two separate rulings since 2018, New Jersey and Florida have aligned themselves with Daubert. That’s good news for attorneys defending cases in those states—especially product liability cases—because plaintiffs will have to meet a higher standard before espousing scientifically unsupported expert opinions. Here’s a look at what happened in the two states that just joined the ranks of Daubert believers: New Jersey On August 1, 2018, the New Jersey Supreme Court issued a landmark ruling in the case of In re Accutane Litigation, in which it essentially adopted the key factors set forth in Daubert as guideposts for determining the reliability of scientific expert evidence. Accutane was a prescription medication developed by Roche that was effective in treating severe acne. In the case before the New Jersey Supreme Court, 2,000 plaintiffs alleged they developed Crohn’s disease because they took Accutane and the drug’s developer, Roche, filed a motion
New Jersey, Florida align themselves with stricter standard for expert testimony seeking a hearing on the association between Accutane and Crohn’s disease. At issue was the admissibility of scientific evidence under the New Jersey Rules of Evidence. The Supreme Court discerned little distinction between “Daubert’s” principles regarding expert testimony and New Jersey’s, and Daubert’s factors for assessing the reliability of expert testimony “will aid New Jersey trial courts in their role as the gatekeeper of scientific expert testimony in civil cases.” The court reconciled the state with the federal Daubert standard to incorporate its factors for civil cases. The non-exhaustive list of factors set forth in Daubert when assessing the validity and reliability of scientific expert testimony is now recognized in New Jersey. Despite adopting these factors, New Jersey had not previously and still has not formally adopted Daubert as its standard with regard to expert testimony. The court noted, in its holding in Accutane, that both New Jersey law and the Daubert standard “are aligned in their general approach to a methodology-based test for reliability.” Both standards examine “whether an expert’s reasoning or methodology underlying the testimony is scientifically valid,” and “… whether that reasoning or methodology properly can be applied to [the] facts in issue.” Given these similarities, the New Jersey Supreme Court was “persuaded that the factors identified originally in Daubert should be incorporated for use by [New Jersey] courts.” The court also clarified that “[d]ifficult as it may be, the gatekeeping role must be rigorous” and explained that while “the trial court should not substitute its judgment for that of the relevant scientific community,” the court’s proper “function is to distinguish scientifically sound reasoning from that of the self-validating expert, who uses scientific terminology to present unsubstantiated personal beliefs.” This means that, before permitting expert causation testimony to reach a jury, the court is required to conduct a “robust analysis of the methodology advanced” to determine whether the expert has “demonstrate[d] the validity of his or her reasoning.” Where a trial court determines that an expert continued on next page
12 | Product Liability Playbook
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Florida
has “applied a contradictory and selective form
On May 23, 2019, the Supreme Court of Florida, pursuant to its exclusive rulemaking authority granted by the Florida Constitution, adopted the Daubert standard as to the admittance of certain expert testimony into evidence. These Daubert amendments were codified into sections of the Florida Evidence Code.
of reasoning” to reach his or her conclusions, those conclusions “should not be allowed to be advanced before a jury.” Although it decried the Frye standard as being “unsatisfactorily constricting,” the New Jersey Supreme Court had ruled previously that it was possible that evidence could be put forward which was based on a causation theory that had not yet reached general acceptance in the scientific community but which could be found sufficiently reliable if based on a sound, adequately founded scientific methodology involving data and information of the type reasonably relied on by experts in the scientific field. However, this relaxed or somewhat hybrid standard often resulted in uncertainty and in the court declining to do more than a superficial examination of whether the expert offered a plausible scientific explanation and whether the expert’s conclusions were based on the types of data and information reasonably relied on by comparable experts in the scientific field. As such, the ruling in Accutane provided much-needed guidance to the trial courts as
These amendments were previously considered, applied (in 2013) and then rejected (in 2017-18), when the Florida Bar’s Code and Rules of Evidence Committee recommended that the Court decline to adopt the Daubert amendments to the extent that they were procedural in nature and risked violating the constitutional right to jury trial and access to the courts. In essence, the naysayers were concerned that, since the court acted as the gatekeeper over the admission of evidence in the form of expert testimony, it was abrogating a party’s right to a jury trial as the Court was weighing the evidence, not the jury. However, case law from a multitude of jurisdictions, including Texas and the Eighth Circuit, held that Daubert does not violate a party’s constitutional 7 th Amendment right to a jury trial.
negative treatment of this ruling in New Jersey.
The Florida Supreme Court opined that the Daubert amendments remedied deficiencies caused by the Frye standard, which allowed an expert to testify based on his or her opinion,
‘Loose Handles’ continued from page 11
Injunctive Relief
are present, but the wrong manifested by its silence perdures beyond the initial failure to make a timely report.”
With respect to the injunctive relief, Spectrum argued that the court lacked the authority to impose forward-looking injunctive relief, and that the broad provisions of the injunction were an abuse of discretion.
to their role in determining the admissibility of expert opinions. To date, there has been no
The court applied the continuing violation doctrine, which operates to “prevent a defendant from using its earlier illegal conduct to avoid liability for later illegal conduct of the same sort.” In effect, this doctrine allows the government to run the statute of limitations from the “last act” of the defendant, rather than the first act as advocated for by Spectrum. The court also clarified the underlying rationale of the doctrine, noting that certain elements of a crime or civil violation may be present early in the course of a defendant’s wrongdoing; in these instances, the doctrine serves to delay the accrual of a cause of action until the defendant’s last act. Thus, since Spectrum had not finally issued a CPSC report until 2012, the statute of limitations began to run from that point.
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The Seventh Circuit did not find Spectrum’s arguments regarding the injunction persuasive. The court first considered whether injunctive relief issued by the district court could be permanent and “forward-looking” in nature—that is, continuing even in the absence of a continuing CPSA violation. The court considered both the text of the statute and legislative intent to find that injunctive relief is, by nature, forward-looking. This was further evidenced by the statute’s authorization for a district court to “restrain any violation of section 2068 of this title.” Thus, the court reasoned, absent express congressional action to the contrary, a forward-looking injunction under the CPSA is entirely within the powers of a district court.
if such opinion was considered generally acceptable in the relevant scientific community. However, this often acted to allow into evidence expert opinions based on new or novel scientific techniques and/or opinions, which were not peer-reviewed or generally accepted in the scientific community, also known as “junk science.” The Florida Supreme Court believed that Daubert “allowed the trial judge to ensure that any and all scientific testimony of evidence admitted is not only relevant but reliable.” (Daubert, at 589.) The Florida Supreme Court also felt that amending the Florida Evidence Code would create consistency between the state and federal courts with respect to the admissibility of expert testimony, which would promote fairness and predictability in the legal system, as well as help lessen forum shopping. The defense bar in Florida is reputedly quite pleased with the court’s action and, per the Florida Chamber of Commerce, this ruling “may help to end Florida’s reign as a judicial hellhole.” Lisa P. Gruen focuses her practice on representing clients in a variety of civil actions in the areas of product liability, fire law, premises liability, professional liability, medical devices, construction defect, and toxic tort.
The Seventh Circuit also failed to find the breadth of the injunction unreasonable. The court noted that the district court “reasonably concluded that a permanent injunction requiring the company to take specified categories of proactive measures was a necessary and appropriate step aimed at reducing the likelihood that the company would, in the future, commit violations similar to those that had led the court to fine the company.” The court also rejected the notion that the injunction was vague and overbroad, instead finding that the mandated appointment of an independent expert sufficiently addressed concerns regarding compliance with the order. Staci A. Williamson focuses her practice on product liability litigation, including matters involving fires and explosions, product labeling and warnings, and other issues arising under the Consumer Product Safety Act. Law clerk Colin Black contributed to this story.
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CROSSOVER Success stories from other Goldberg Segalla practice groups
Judge Throws Out Former-NFL Player’s Workers’ Compensation Claim
Closing Argument Wins the Day in Liability Case Involving Injured Woman
The end zone wasn’t a place Evan Moore spent much meaningful time during his brief NFL career.
Defending a Massachusetts-based big-box retail outlet against a seven-figure liability suit by a Florida woman who claimed she’d slipped and fallen twice during a single visit to the store, Goldberg Segalla partner David J. Majcak had little to work with except the underwhelming testimony of a store employee. He braced himself for a punishing verdict.
Nor was California, a state workers’ compensation judge has ruled regarding Moore’s claim for injuries he allegedly sustained as a player. Although Moore signed with five teams and played with three between May 2008 and his retirement in the spring of 2013, none of them was based in the Golden State, and none of the contracts Moore signed was made there. So when he filed a California workers’ compensation claim against the Green Bay Packers, Cleveland Browns, Seattle Seahawks, and Philadelphia Eagles, the judge threw it out. That California is where Moore lives and where his agent was based wasn’t enough to establish jurisdiction in that state, the judge ruled. Moore can appeal, but the judge’s decision augurs yet another successful client defense for Goldberg Segalla partner Joshua J. Roberts, a co-chair of the firm’s Sports and Entertainment practice group, which assists entertainment studios, global media companies, major league sports franchises, and related entities with all types of workers compensation concerns, as well as employment and labor, general defense, cybersecurity, patent infringement, and transactions and contracts. Josh focuses on defending and counseling clients in workers’ compensation and employment-related matters. He is a key counselor to executives in numerous major-league sports organizations and franchises, including members of the NFL, MLB, NBA, and NHL, and he regularly defends these major-league sports entities in employment and labor-related matters on trial and appeal. In the Moore case, Josh represented the Seattle Seahawks. The judge’s June 27, 2019, decision is a win for that organization as well as the other defendants but another anticlimax for Moore, who caught 63 passes for a total of 810 yards in the NFL but scored only five touchdowns. Now a FOX Sports college-football analyst, Moore claims he sustained head, neck, spine, neurological, internal, and other injuries during his playing career.
But then he scored a resounding victory. Winning cases is nothing new to Dave. A member of Goldberg Segalla’s Retail and Hospitality practice group, he’s an experienced civil litigator who focuses on defending clients against a wide range of liability claims, including those relating to personal injury, wrongful death, product liability, employer liability, construction disputes, motor vehicle accidents, and premises liability. He has represented state governments, manufacturers, property owners, and subcontractors in state and federal courts, handling his cases from inception through resolution. In short, Dave’s no stranger to success. But the big-box store case, he figured, was only about 10 percent winnable. He lacked the facts necessary to defend against a liability claim. The plaintiff, a 42-year-old woman, had slipped and fallen while shopping at the store January 5, 2013—first on a cherry tomato in the produce department and then on a blue, gooey substance like shampoo between the registers and front door—allegedly injuring her spine, her shoulder, and her wrist, and exacerbating a jaw disorder. Two years later, she had surgery on her right shoulder; a year-and-a-half after that, in June 2016, she had cervical-spine surgery; and, in June 2017, she underwent another surgery on her right shoulder. The woman’s medical expenses amounted to more than $275,000, and her orthopedic surgeons all testified that her medical treatment and associated expenses were necessitated by her accident. Without any evidence of prior orthopedic treatment, the defense’s own medical experts conveyed that this was not a good case on damages. In fact, the defense’s medical expert testified that the first shoulder surgery was due to the injuries from the accident. During the four-day jury trial in March 2019, Dave and Rodney J. Janis contended the woman had failed to prove the store knew there were slipping hazards and yet not cleaned them up, which Florida law requires to establish liability. But a 25-year-old former store employee who was present when the accident occurred, and whose testimony was the defense team’s only hope of countering the plaintiff’s liability claim, had been unconvincing. So, in his closing argument on March 29, Dave focused on the law instead of the facts, and it worked. Three hours later, the jury returned a full defense verdict.
14 | Product Liability Playbook
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