Who’s Who Legal brings together four of the leading practitioners in the world to discuss key issues facing product liability defence specialists today.
WWL: Product liability class actions are becoming increasingly international in nature. Can you detail the challenges to be met in ensuring strong coordination and case management across multiple jurisdictions in cross-border disputes?
Ina Brock: The pressure on global acting companies is compounded if plaintiffs’ lawyers coordinate their action in the various jurisdictions. In this context, the fact that the national supervisory authorities are increasingly networked is also important. The influence of the media is another factor that should not be underestimated. As the public controversy escalates and the number of potential lawsuits grows, liability claims can become the subject of political debates, for example, in the context of legislation reforms. A comprehensive communication and defence strategy must be geared to fending off liability claims brought in multiple jurisdictions, considering the diverse statutory elements of liability prevailing in the different jurisdictions involved. It must also consider the potential personal liability – under both civil and criminal law – of the company and representatives and employees. At the same time, the company must be aware of the impact of the public and political discussion of the case. All this calls for a strategy that is not confined to legal considerations alone and coordination and case management to ensure consistent communication everywhere within the litigation and beyond.
Andrey Zelenin: A class action, as a legal concept, is quite new in Russian law: it was only introduced in 2009 and is restricted to commercial disputes. The relevant statutory regulations currently aim to be mainly applicable to corporate relationships, and are not fit for product liability cases. In any case, we are not aware of any class actions in the pharmaceutical sector in Russia. We can also mention the concept of “representative action” existing in the Russian Statute on Protection of Consumer’s Rights: certain public bodies or consumers’ associations are entitled to bring action in the name of general public (consumers); in frame of such actions it is not possible to seek compensations however, rather only recognition of a wrongdoing committed by the respondent.
If Russian jurisdiction is involved in a broader international product liability class action case it is necessary to ensure that all documents and other evidence are drafted and collected in accordance with local requirements and practices. That is especially relevant when considering whether to appoint a public notary to assist in securing evidence or on whether and how to go through the legalisation procedures (apostille stamp, etc).
Isabel Foley: While there is no mechanism for class actions in Ireland, multiple product claims are frequently brought in this jurisdiction following class action or other multiparty litigation internationally. Consistency of approach across all of the litigation that the client is facing, while reflecting and taking account of local requirements and differences in individual jurisdictions, is key. A deep understanding of the overall client strategy, its approach to individual legal issues in the litigation (wherever it takes place), the concessions it is prepared to make and the areas which will not be conceded is fundamental, as is acquiring a good knowledge of the scientific and medical issues and facts underlying the litigation. It is also important to maximise and share the expertise in relation to particular issues in the litigation, built up by the various law firms representing the client in different jurisdictions, as this can bring considerable efficiencies and cost savings. Lawyers in the individual jurisdictions should work closely with in-house counsel and external law firms to ensure a strongly co-ordinated and consistent approach, while bringing their country specific expertise to bear on the litigation, to maximum effect. Understanding the client’s international communication strategy is also very important.
Gordon McKee: The challenges that must be met include: understanding the differences in the laws and procedures among the different jurisdictions where litigation may be commenced early enough to make and implement strategic decisions; being aware of regulatory activities in different countries, the need for consistent regulatory responses to the extent feasible and developing strategies for handling differences in regulatory decisions; anticipating and counteracting increasingly coordinated activities of the plaintiffs’ bar; and avoiding activities and positions taken in one jurisdiction prejudicing the company’s ability to defend in other jurisdictions.
Further, class actions and mass tort litigation impose enormous burdens on corporate defendants in terms of employees’ time, the cost of extensive document preservation and collection, the expense of experts and legal defence costs. These burdens can increase substantially if class actions with overlapping claims and classes are vigorously pursued in a number of jurisdictions at the same time. As the volume of litigation a company faces globally on a particular issue increases, the risk of inadvertently taking inconsistent positions and inefficient case preparation also increases. Accordingly, there is a growing need for corporate defendants to proactively plan for anticipated litigation with early input from counsel knowledgeable of the laws and procedures in all jurisdictions where mass tort and class litigation can be expected, having regard for key strategic issues such as venue/jurisdiction challenges, documentary discovery (including preservation, privilege, confidentiality), oral discovery, experts, settlement strategy and trial themes/strategies.
WWL: What trends do you foresee for the year ahead? Do you expect any significant changes to the law regarding product liability in your jurisdiction that will have an effect on clients?
Ina Brock: The issues of compliance and criminal liability will become even more important with regard to product liability. Internal investigations in this respect gain in importance. The increased public perception of product liability litigation will ultimately lead to an increased preparedness for legal action of consumers. Plaintiffs’ lawyers are more creative in finding ways to bring a large number of claims in one action even in fields of law where collective redress mechanisms (eg, class or group actions) do not exist. Also, plaintiffs’ lawyers are improving their global networking. Moreover, the scientific and public discussion is more often influenced by external (scientific) advisers of plaintiffs’ lawyers. They can often rely on information that plaintiffs have obtained based on information claims, eg, the freedom of information act. In this context, data protection issues will become more relevant in the future.
Andrey Zelenin: In Russia, product liability legislation in the pharmaceutical sector has not yet been massively tested in civil actions. We anticipate that regulations on mandatory pharma co-vigilance reporting will become operative in the New Year. This should definitely stimulate public attention to the issues of side effects and – more generally – to quality of medicines.
Isabel Foley: In Ireland, as with all EU member states, the imminent changes heralded by the European Commission’s Product Safety and Market Surveillance Proposal (published in February 2013), specifically the coming into force of the proposed Regulation on Consumer Product Safety, will, if implemented, be the most fundamental change in this area, given the extent to which it interrelates with product liability issues.
There has also been a recent change in the monetary jurisdiction of the Irish Courts, including the Circuit Court (a court of lower jurisdiction than the Irish High Court). The Circuit Court jurisdiction has been raised from just over €38,000 to €75,000 (with a limit of €60,000 in personal injuries cases). Circuit Court personal injury cases generally progress much faster than those taken in the High Court and do not benefit from the same degree of Court time as would be allocated in the High Court. The revised monetary threshold may lead to an increase in the number of product liability cases traditionally handled by the High Court now being brought in the Circuit Court.
Gordon McKee: Product liability claims will likely continue to be pursued through class actions in Canada. In a trilogy of decisions from the Supreme Court of Canada released on 31 October 2013, the Court reaffirmed the low “some basis in fact” evidentiary standard for class certification in Canada. However, the Court also clarified the requirement that the plaintiff demonstrate that there are two or more members of the class and clarified the availability of aggregate damages and, in doing so, arguably made it harder for plaintiffs’ counsel to certify cases where it is not possible to establish loss or damage to individual class members. The Court affirmed that class actions are intended to allow the collective pursuit of individual claims rather than to create new mechanisms to pursue collective claims where individuals cannot prove a cause of action. It remains to be seen how these cases will impact lower court decisions in product liability cases.
In 2014, the Law Commission of Ontario (one of the most active provinces for product liability class actions) will be conducting a review of Ontario’s class action legislation and procedures, to assess whether they are working as intended and to consider some of the challenges beyond the four corners of the legislation. Amendments to the legislation are a potential outcome of this review.
Relevant legislative changes pending or proposed include anti-spam legislation and amendments to the Canadian Food and Drugs Act, giving the government recall powers over medicines and medical devices, and imposing tougher penalties for breaches of the legislation.
WWL: The medical devices field has been a particularly active source of disputes, with several lawyers reporting that the amount of product liability litigation in this area has continued to rise throughout 2013. Is this the case in your jurisdiction, and have there been any high-profile rulings that will affect your advice to clients?
Andrey Zelenin: The Russian landscape of pharmaceutical disputes is not yet wide enough to draw any sound conclusions in relation to disputes concerning medical devices apart from other disputes in the pharmaceutical sector. However, we observe that the density of normative regulation in the area of medical devices manufacturing and circulation has substantially increased over the recent couple of years. This provides consumers and other interested parties with a broader range of remedies and tools in future potential disputes with the medical devices manufacturers.
Ina Brock: There is a significant increase of product liability litigation in Germany in the field of medical devices. Following several important court decisions relating to pharmaceuticals, the liability regime relating to medical devices now becomes the focus of attention. In this respect, the implantable class III medical devices play an important role. This is largely because a potential product defect can easily have a significant impact on the patients’ health and the consumer cannot just stop using the (allegedly) defective product but has to make a conscious decision to remove the implanted device. This mostly requires a medical intervention. In this respect, the German Federal Supreme Court now presented the question to the European Court of Justice whether or not a claim can be based on the product liability act if there is only a suspicion that the product might be defective. The current discussion is of substantial legal importance for patients, professionals and producers. If the European Court of Justice would come to the conclusion that already the suspicion of a defect would constitute a defective product within the meaning of the product liability act, this would possibly have major impact for other industries, too, and also related insurers.
Isabel Foley: I would agree that in Ireland this is an area that has seen a rise in claims, in particular given the protracted and ongoing coverage of international litigation in relation to breast implants, hip replacements and other devices, and the recent debates within the European Parliament surrounding the text of the proposed new Regulation on Medical Devices. Whilst there is no high-profile ruling in this jurisdiction which I would point to as altering advice to clients, recent rulings in medical devices litigation in other EU jurisdictions, in particular other common law jurisdictions, are likely to be monitored closely by both Irish plaintiff and defendant lawyers.
It is also worth noting the key importance of the medical device sector overall to the Irish economy: Ireland has the highest proportion of people working in the medical devices industry of any country in the European Union with Europe’s main cluster of device companies being located in the Galway region. This has an undoubted impact on medical device litigation in this jurisdiction.
Gordon McKee: The amount of product liability litigation – particularly class actions – involving medical devices has continued to rise, much of it following on related litigation in the United States. A number of product liability class actions involving devices were certified in 2013. Perhaps the highest-profile ruling in this area was a decision of the Superior Court of Ontario dismissing a product liability class action against a leading cardiac device company following a 146-day common issues trial, Andersen v St Jude Medical, 2012 ONSC 3660. A number of mid-trial rulings in that case, related to the admissibility and use of evidence of foreign regulatory approval, foreign statutes and regulations, as well as marketing activities outside Canada, and the use of US deposition transcripts in Canadian proceedings, will also be of significance in advising clients in this area.
WWL: Sources have commented on the growing demand for experienced lawyers with case experience in product liability disputes. Does this reflect the current situation in your field and how difficult is it for younger lawyers to make an impact in this area?
Ina Brock: It is true that experience is key in product liability litigation, in particular with regard to the coordination and case management across multiple jurisdictions in cross-border disputes. The younger lawyers in our practice group work closely with the responsible partners on these matters. Without making such important practical experience, it would be certainly difficult to make significant an impact in this area.
Andrey Zelenin: Representing a client in a product liability dispute demands a very good knowledge of the industry specifics. This is especially true in the pharmaceutical sector. And it is not easy to find a Russian-qualified lawyer who is experienced in pharmaceutical issues. This may be a good opportunity for young professionals indeed. However, we note that legal professionals may develop their pharmaceutical expertise only when practising law, ie, not from schoolbooks.
Isabel Foley: It is undoubtedly the case that in multiparty product liability disputes, having an experienced lawyer involved is essential given the range of challenges which this type of litigation can bring, particularly if it is multi-jurisdictional. That said, there is ample opportunity for younger lawyers to gain exposure to product liability disputes and to build up their own expertise in the area.
Gordon McKee: Life sciences manufacturers have consistently sought out experienced lawyers with life sciences industry product liability experience, and I expect this will continue. Younger lawyers can still make an impact in this area by researching and publishing papers on legal issues of importance to the area, ideally with the mentorship of a more experienced lawyer, joining and becoming active in industry and legal committees that focus on this area of practice to learn about the industry and issues of importance to it, and seeking out and embracing opportunities to be involved in cases that their firms are handling in the area.