Court Rulings/Decisions

We have written extensively on this blog about personal jurisdiction and how the U.S. Supreme Court’s decision in Bristol-Myers Squibb Co. v. Superior Court of California changed the rules regarding specific jurisdiction.
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During the holidays, many Americans flock to nearby stores to buy presents and decorations. And given today’s global economy, many of those products are made by foreign manufacturers. But what happens if the product fails in a manner that could give rise to potential legal liability? That raises the question of when a domestic plaintiff can sue the manufacturer of a product manufactured outside the United States.

Therein lies the artificial Christmas tree conundrum. Historically, plaintiffs would turn to the “stream of commerce” doctrine to seek personal jurisdiction over product manufacturers and distributors that are not present in the forum state. Sometimes they were successful, but sometimes they were not. And the U.S. Supreme Court’s recent decision in Bristol-Myers Squibb Co. v. Superior Court of California[1] is further muddying the waters.
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Generic pharmaceutical drugs are versions of brand-name counterparts with one major difference:  they typically cost a lot less. By FDA regulation, the two have the same active ingredients, dosage forms and strengths, and routes of administration.[1] And while federal law generally regulates pharmaceutical approval, states can regulate pharmaceutical distribution. Why is this significant? All states permit pharmacies to substitute generic drugs for the brand name equivalent, and some states require substitution in certain circumstances.[2] But a generic pharmaceutical company cannot change the brand company’s product label, so a person’s ability to sue a drug manufacturer is limited to the brand company who created the label.[3]
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In many mass tort cases, and particularly in cases involving exposure to a substance with a long latency period, defendants and plaintiffs must rely on documents created decades ago. That’s challenging, of course, because many of these documents are hearsay and often there’s no one around with personal knowledge of their authenticity or contents. But there is hope for parties trying to admit these documents: they may be able to call on the ancient document hearsay exception.
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Long-anticipated changes to California’s Proposition 65 warning requirements took effect on August 30, 2018, through amendments and new rules issued by the California Office of Environmental Health Hazard Assessment. Among other changes, the new rules now (1) require businesses to provide California consumers with product warnings at the time of purchase, including at the time of online purchases; and (2) change the text of the warnings that businesses may use to qualify for “safe harbor” protections. The new warning requirements apply only to products manufactured after August 30, 2018.
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Product liability defendants often seek to remove cases to federal court. That’s because federal jurisdiction provides the federal pleading standards, robust expert discovery, efficiency through uniform procedural and evidentiary rules, and often more diverse jury pools. Sometimes defendants can use removal to leverage early case resolution.

But it’s not always clear when a defendant can remove to federal court because the rules vary among the circuit courts, the facts drive the decision, and the case law continues to develop.  This year several cases highlighted the evolving removal landscape and addressed four important questions.
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A Chicago jury awarded a single plaintiff $150 million in punitive damages, finding that AbbVie, Inc. fraudulently misrepresented the safety risks of its drug used to treat low testosterone, AndroGel. But the jury also decided in AbbVie’s favor on the plaintiff’s strict liability and negligence claims—meaning that they determined that AndroGel did not cause the plaintiff’s alleged injury. As a result, the jury awarded no compensatory damages.
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For the past several months, Monsanto has been in court challenging California’s decision to add the chemical glyphosate—the active ingredient in its herbicide Roundup—to the Proposition 65 list. It recently faced a setback when the California Supreme Court rejected Monsanto’s request to stay a lower court’s decision to include glyphosate among the 960 chemicals on the list.  California’s Office of Environmental Health Hazard Assessment (OEHHA) wasted no time after the decision and added glyphosate to the list on July 7, 2017.
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On June 19, 2017, the U.S. Supreme Court decided Bristol-Myers Squibb Co. v. Superior Court of California (BMS), an action brought in California state court that included some non-California plaintiffs alleging injuries not suffered in California. The Supreme Court – for the second time this term – narrowed where plaintiffs can constitutionally sue companies.

The decision already is impacting mass tort actions. On the same day as the BMS decision, a Missouri state court declared a mistrial in an action alleging that Johnson & Johnson’s talc products cause ovarian cancer.

BMS provides product liability defendants with an opportunity to argue that state courts do not have personal jurisdiction over them when the claims have no connection with the defendants’ activities in the forum state.
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