Products liability (also called strict liability) is a concern for everyone involved in the medical device industry. The executives of A. H. Robbins, the manufacturer of the Dalkon Shield, learned that products liability can cost you your company. Products liability is such an effective sword for plaintiff's attorneys because it proceeds from the assumption that products should not injure their users.
Products liability law is state law, not federal. While many lawsuits are filed in federal court, these are termed "diversity" cases because they involve a diversity in state citizenship: claims by plaintiffs against a manufacturer based in a different state. Federal judges deciding cases based on diversity jurisdiction must apply the law of the state where the injury occurred. Most states base their products liability laws on section 402(A) of the Restatement of Torts. (The Restatements are privately produced "model" laws drafted by a club of law professors and lawyers. They have no legal authority until adopted by a state's courts or legislature.)
In its original form, strict liability spread the costs of the occasional injury caused by an otherwise beneficial product to all the users of the product. In its purest form, fault was not relevant. Suppose, for example, that a drug will benefit a thousand of the 1,001 patients who will use it, but, statistically, due to the subtle differences among human beings, one patient will be harmed, no matter how perfectly the drug is manufactured and labeled. Suppose further, that, the typical damage caused by the drug costs $10,000. If $10 were added to the price of each prescription of the drug, a fund in the amount $10,000 would evolve to pay for the harm suffered by the unlucky user.
However, a funny thing happened on the way to bypass the courthouse: One of the leading members of the club drafting section 402(A) refused to support no-fault liability, and instead insisted that the product be "in a defective condition unreasonably dangerous to the user":
"SPECIAL LIABILITY OF SELLER OF PRODUCT FOR PHYSICAL HARM TO USER OR CONSUMER
(1) One who sells any product in a defective condition unreasonably dangerous to the user or consumer or to his property is subject to liability for physical harm thereby caused to the ultimate user or consumer, or to his property, if
(a) the seller is engaged in the business of selling such a product, and
(b) it is expected to and does reach the user or consumer without substantial change in the condition in which it is sold.
(2) The rule stated in Subsection (1) applies although
(a) the seller has exercised all possible care in the preparation and sale of his product, and
(b) the user or consumer has not bought the product from or entered into any contractual relation with the seller."
The key is the tension between subsections (1) and (2)(a). Subsection (2)(a) relieves the plaintiff of the burden of proving that the manufacturer was negligent in the preparation and sale of the product (no fault), whereas subsection (1) requires that the product be in a defective condition unreasonably dangerous to the user. Unfortunately, defective and unreasonably dangerous are terms that are easier to understand when applied to lawnmowers and soft drink bottles than to medical devices. With this problem in mind, the drafters of section 402(A) added an explanatory paragraph, comment k:
"k. Unavoidably unsafe products. There are some products which, in the present state of human knowledge, are quite incapable of being made safe for their intended and ordinary use. These are especially common in the field of drugs. An outstanding example is the vaccine for the Pasteur treatment of rabies, which not uncommonly leads to very serious and damaging consequences when it is injected. Since the disease itself invariably leads to a dreadful death, both the marketing and the use of the vaccine are fully justified, notwithstanding the unavoidable high degree of risk which they involve. Such a product, properly prepared, and accompanied by proper directions and warning, is not defective, nor is it unreasonably dangerous. The same is true of many other drugs, vaccines, and the like, many of which for this very reason cannot legally be sold except to physicians, or under the prescription of a physician.
It is also true of many new or experimental drugs which, because of lack of time and opportunity for sufficient medical experience, there can be no assurance of safety, or perhaps even of purity of ingredients, but such experience as there is justifies the marketing and use of the drug notwithstanding a medically recognizable risk. The seller of such products, again with the qualification that they are properly prepared and marketed, and proper warning is given, where the situation calls for it, is not to be held to strict liability for unfortunate consequences attending their use, merely because he has undertaken to supply the public with an apparently useful and desirable product, attended with a known but apparently reasonable risk."
Section (1) and Comment k, of course, changed simple insurance coverage for the occasional injured patient into a litigious bonanza for lawyers.
Comment k was finalized in 1965, when medical devices were seldom the targets of litigation. The key requirement is that if product manufacturers warn about the unpreventable risks posed by their products, these risks will not considered to be defects and they will not be liable to individuals injured by the occurrence of a disclosed, unpreventable risk. Comment k is written in terms of drugs, and, until recently, most courts have limited its applicability to prescription drugs. Comment k is generally expressed as the "learned intermediary" doctrine: the duty to warn of unpreventable risks runs to physicians prescribing the drugs, rather than to the patients. This recognizes the twin problems in warning patients; 1) it is difficult to assure that the warning actually reaches the patient, and 2) that the patient is not sufficiently knowledgeable to properly appreciate the risks of the product. It has the added benefit that manufacturer may assume that the physician has a competent knowledge of pharmacology, thus greatly simplifying the task of writing a proper warning.
Next - Limitations of Comment k.
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