| From
the editors of Wolters Kluwer Law & Business, this update describes
important developments from CCH products liability and safety publications.
If you have any comments or suggestions concerning
the information provided or the format used, we'd like to hear from you.
Please send your comments to pamela.maloney@wolterskluwer.
Products Liability
South Carolina High Court Rejects Use
of Opt-In Class Action
The creation of an opt-in class action in a
lawsuit against a synthetic stucco manufacturer was improper because opt-in
class actions are inconsistent with South Carolina's class certification
process, the South Carolina Supreme Court ruled. The plaintiffs consisted
of a class of individuals who owned property that had the stucco product
applied to the exterior. Although the stucco manufacturer sought to decertify
the class, the lower court held that the class met all of the state's
requirements for a class action, explaining that the differences between
the class members' claims were not so great that they weighed against
class certification. In addressing the issue of class notification, however,
the lower court established an "opt-in" notification procedure
because it found that the approach was the most "pragmatic."
In reviewing the court's class notification procedure, the high court
found that while federal rules on class notification mandate the use of
"opt-out" classes, South Carolina does not specifically require
their use. Although South Carolina's procedural rules gave courts broader
discretion, past decisions have demonstrated the state's preference for
opt-out class actions. The court rejected the notion that an opt-in class
action was different from an opt-in class notification procedure as a
distinction in name only. In addition, the court found that opt-in class
actions were inconsistent with the state's procedural rules for class
certification because they would undermine the due process reasoning behind
the class certification process and convert a class action into a form
of permissive joinder in which the individuals that are proper class members
would be denied a trial by jury. The court further reasoned that the opt-in
method improperly places concerns of judicial economy over the interests
of the class members by forcing smaller class actions and increasing the
likelihood that some class members would not be compensated. The court
concluded that opt-in class actions were improper because they resulted
in de facto decertification that would eviscerate the purpose behind class
actions (Salmonsen v. CGD, Inc., S.C. S.Ct.; CCH Products
Liability Reporter, May 21, 2008, ¶17,994
(ip
access user)).
CPSC Lighter Certification Premepts
Texas Design Defect Claim
A design defect claim against
a lighter manufacturer was preempted by federal regulations on the certification
and testing of child-resistant lighters by the Supreme Court of Texas.
A 6 year-old child was severely burned when her 5 year-old brother accidentally
set fire to her dress with a lighter. The parent of the injured child
received a $5 million award which an appeals court affirmed because there
was sufficient support for the parent’s design defect claim. The
lighter's manufacturer, however, argued that the design defect claim was
not a proper basis for affirming the judgment because it was impliedly
preempted by the Consumer Product Safety Commission's (CPSC) child-resistant
lighter testing. The parent argued that her state tort claims were preserved
under the Consumer Product Safety Act's savings clause. Although the savings
clause specifically retains state tort claims, the Texas Supreme Court
found that the clause could not preserve claims that are in actual conflict
with federal law or regulations from being impliedly preempted. The court
explained that rather than mandate specific child-resistant features,
the CPSC's regulations require child-resistant lighters to undergo testing
in which no more than 15 percent of a test group of children are able
to operate the lighter. The CPSC had granted certification to the lighter
involved in the child's injury because only 10 percent of the test group
were able to operate it. In finding that the parent's design defect claim
conflicted with the CPSC's certification of the lighter, the court determined
that the testing protocol's 15 percent threshold was a deliberate decision
to balance utility and safety. The court reasoned that CPSC's certification
of the lighter did not represent a minimum safety floor which state tort
law could extend beyond. The court further noted that the CPSC determined
that a more stringent standard was possible but specifically rejected
imposing one. The court concluded that the design defect was preempted
because it conflicted with federal regulations and, therefore, could not
serve as a proper basis to affirm the jury's award (BIC Pen Corp.
v. Carter, Tex. S.Ct.; CCH Products Liability Reporter,
May 7, 2008, ¶17,980
(ip
user access) and CCH Consumer Product Safety Guide,
April 30, 2008, ¶75,762
(ip
access user)).
FDA’s Rejection of SSRI Suicidality
Warning Preempts Warning Claim
The Food and Drug Administration's
(FDA) public rejection of a suicidality warning for a class of antidepressants
known as selective serotonin reuptake inhibitors preempted state failure-to-warn
claims brought on behalf of two adults who committed suicide while using
the drugs, the U.S. Court of Appeals for the Third Circuit held. The families
of the two adults argued that their claims were not preempted because
the FDA-mandated labeling constituted a minimum standard because FDA regulations
specifically allowed drug manufacturers to provide stronger drug warnings.
Although the FDA eventually issued a suicidality warning for pediatric
patients, it found there was no evidence that the drugs were associated
with suicidal thinking in adults over the age of 24. In finding that the
families' claims were preempted, the appeals court held that the FDA's
rejection of an adult suicidality warning was within its authority to
remove false and misleading statements from a drug's label. The court
noted that the families sought to rely on some of the same studies the
FDA found to be unreliable in reaching its conclusion. The court did not
decide whether the FDA-mandated labeling was a minimum standard; however,
it found that the FDA's public rejection of the families proposed warning
was sufficient to preempt a state law claim that would require that same
warning. Lastly, the court dismissed the families' argument that the rejection
of the proposed warning should not be given weight because it did not
occur within the FDA's formal warning amendment process, reasoning that
otherwise a manufacturer would need to propose a warning it did not believe
was necessary to receive a formal rejection (Colacicco v. Apotex Inc.,
3d Cir.; CCH Products Liability Reporter, May 7, 2008,
¶17,977
(ip
access user)).
Products Safety
U.S. Supreme Court Asked To Review
Preemptive Effect of Seat Belt Standard
The parents of a 12-year-old
who was killed in a motor vehicle accident have asked the U.S. Supreme
Court to review a decision by the U.S. Court of Appeals for the Fifth
Circuit [CCH Consumer Product Safety Guide ¶75,555 (ip access user)]
holding that their common law claim based on the vehicle maker’s
failure to install a lap/shoulder seat belt in the vehicle’s center
rear seat was preempted by federal safety standards regulating the options
available to manufacturers for the placement of lap/should sear belts.
The high court was asked to determine whether NHTSA regulations on sear
belt placement there were no supported by a safety purpose could be a
proper basis for preemption and whether all common law claims alleging
defects in safety restraint systems were preempted by the motor vehicle
safety standard at issue in spite of the National Motor Vehicle Safety
Act’s savings clause. (Carden v. General Motors Corp.,
Docket No. 07-7302, CCH Consumer Product Safety Guide,
Report No. 913, April 30, 2008)
$House Bill Targets Foreign Manufacturers
of Faulty Products
By Sarah Borchersen-Keto,
CCH News Bureau Staff Writer
A bill introduced in the House of Representatives would make
it easier for consumers to seek compensation for damages resulting from
faulty products made overseas. The Protecting Americans from Unsafe Foreign
Products Act (H.R. 5913), introduced by Rep. Linda T. Sanchez (D-Cal.),
would allow U.S. citizens to serve foreign manufacturers with court documents
where the foreign manufacturer resides, is found, has an agent or transacts
business. The changes relax requirements which sometimes required Americans
to travel to foreign countries or translate documents in order to initiate
a lawsuit. (CCH Consumer Product Safety Guide, Report
No. 914, May 14, 2008)
$320,000 Civil Penalties To Be Paid
by Makers’ of Children’s Outerwear
Eight firms have agreed to pay $320,000 to provisionally settle allegations
that they failed to report to the CPSC, as required by federal law, that
their children’s hooded sweatshirts and/or jackets were sold with
drawstrings at the hood and neck. The firms are Life is Good, Inc., Tru
Religion Appearl, Inc, The Cayre Group Ltd., DollarDays International,
LLC, Kohl’s Department Stores Inc., Seena International Inc., Nieman
Marcus Group Inc., and Gildan Active Wear SRL. (CCH Consumer Product
Safety Guide, May 14, 2008, ¶56,617
(ip
access user))
|