Thursday, May 12, 2011

Botox Maker Hit with $200 Million Punitives Award, But Award Subject to State’s Cap

A federal court jury in Richmond, Virginia, recently ordered drugmaker Allergan, Inc. to pay a staggering $212 million to a 67-year old man who said he suffered brain damage as a result of receiving Botox injections to treat cramps and tremors in his hand in 2007. Ray v. Allergan, Inc., 3:10-cv-00136 (E.D. Va. April 28, 2011). The plaintiff reportedly alleged in his suit that Allergan failed to warn him that Botox injections could trigger an autoimmune reaction that could cause brain damage. He alleged that the injections caused severe medical complications which resulted in total disability and $643,800 in medical costs. He reportedly alleged in his complaint that the drug left him “frequently confused or disoriented,” and that Allergan did not sufficiently warn doctors or patients of the possibility over fear of losing sales.

Bloomberg.com reports that the jury’s award includes $12 million in compensatory damages, and an additional $200 million in punitive damages. Botox is Allergan’s top-selling drug, accounting for $1.42 billion in sales last year alone, which was 29 percent of the drugmaker’s revenue. Perhaps the jury thought that such huge numbers in revenue justified a huge punitive award. Interestingly, however, by Virginia statute, the punitive damages award will be capped at $350,000. The statute further provides that although the jury is not to be made aware of the cap, the trial court is to reduce the award in accordance with that law. Allergan’s spokeswoman has said the company has not yet decided whether to appeal the verdict, but if it does, attorneys for the plaintiff plan to “attack the constitutionality of the cap.”

This is not the first big award handed down against drugmaker Allergan. Last May, we reported here on a $15 million verdict in favor of an Oklahoma doctor who similarly alleged she suffered injury from Botox as a result of the maker’s failure to provide sufficient information regarding possible side effects. In that instance, Allergan vowed to appeal the verdict. It remains to be seen whether in this instance Allergan will take the benefit of Virginia’s punitive damages cap and pay, or whether it plans to similarly appeal the most recent verdict.

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Monday, May 2, 2011

South Carolina Seeks Billions in Suit for Alleged Deceptive Marketing of Drug

A Spartanburg, South Carolina judge is set to decide how much money Janssen Pharmaceutica, Inc., a Johnson & Johnson subsidiary, should pay the state for what the jury found to be deceptive marketing by the company of its antipsychotic drug Risperdal. Last month, a jury agreed with attorneys for the State of South Carolina that the drug manufacturer had violated the state’s Unfair Trade Practices Act by sending misleading letters to approximately 7,200 South Carolina doctors downplaying the links between Risperdal and diabetes. South Carolina law provides for potential penalties of $5,000 for each offense, and since attorneys for the state argued that every single prescription, sample box or “Dear Doctor” letter written since the 1990s may constitute a violation of the law, the number could reach into the billions of dollars.

South Carolina’s suit is the fourth case of its kind to go to court. We previously reported here on a similar case tried in Louisiana. In that case, the jury awarded a $257.7 million verdict against the drugmaker. The jury found that the company had sent 7,604 “Dear Doctor” letters and made a total of 27,542 sales calls in which its sales representatives claimed Risperdal was safer than competing antipsychotic drugs such as Eli Lilly’s Zyprexa and AstraZeneca’s Seroquel. The Louisiana jury assessed penalties of $7,250 for each violation. Of the other two cases, the Pennsylvania case was dismissed in June, and another case in West Virginia was dropped in December.

As reported by TheState.com, Janssen has appealed the Louisiana verdict, although representatives have reportedly not yet decided whether they will do the same with this latest South Carolina jury verdict. That likely will depend on the dollar number reached by the Spartanburg County judge. We’ll continue to follow this case and report on Judge Couch’s ruling.

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Wednesday, April 27, 2011

Recent Complaints Allege that "Your Baby Can Read" Products Do Not, in Fact, Teach Your Baby to Read

A class-action lawsuit has been filed in California against the makers of “Your Baby Can Read” products. The complaint was filed on behalf of a class of consumers who purchased the infant and toddler educational programs based on the company’s claims regarding the effectiveness of its products. Television and radio advertisements for the products in question allegedly made false and misleading claims, including claims that the early language development system could teach a three-month-old baby to read by nine months of age, could enable a five-year old to read at a junior high school level, and could teach infants with Down syndrome how to read.

According to the complaint, such claims made by the company simply are not supported by scientific evidence. Criticism of the company’s products and allegedly misleading advertisements, it seems, has grown in recent weeks. TODAY.com reports that the Campaign for a Commercial-Free Childhood, a national watchdog group that previously successfully campaigned to change the way that the “Baby Einstein” program marketed its products, has filed a separate complaint with the Federal Trade Commission alleging that makers of “Your Baby Can Read” have engaged in deceptive marketing practices to convince parents to buy its products. It has requested that the FTC stop the company from continuing its allegedly deceptive marketing practices, and that it offer full refunds to “all those parents who have been duped.”

The problem with the educational products seems to be two-fold. First, doctors and scientists who have tested the products have reportedly found that infants using the products are not reading, but rather are memorizing the shapes of the letters presented. There is no evidence, the class-action plaintiffs allege, that this memorization process increases a child’s ability to read or comprehend. Second, a representative for the Campaign for a Commercial-Free Childhood points out that the program is actually harmful to children, as it encourages them to sit in front of television screens and computer monitors, getting them “hooked on screens” too early in life. In fact, the group notes that if parents follow the “Your Baby Can Read” instructions, after nine months, babies would have spent more than a full week of 24 hour days in front of a screen.

It remains to be seen what effect these two recent complaints will have on the maker of the infant educational products and on its approach to advertising. It seems that the old-fashioned approach to teaching your children to read – by reading aloud to them – triumphs.

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Tuesday, April 12, 2011

Potential Class Action Suit Involving Keyless Locks Allegedly Easily Breached with Magnet

Eleven lawsuits against lock industry leader Kaba Corporation, a Swiss company with operations in North Carolina, have been consolidated into one potential class-action lawsuit in federal court in Cleveland, Ohio. Cleveland.com reports that the allegations involve the company’s push-button door locks, which the plaintiffs allege can be easily breached with the use of a magnet that fits right in the palm of a would-be intruder’s hand.

The plaintiffs allege that the locks, which can be purchased for less than $200 or more than $1,000 each, depending on the particular model, are defective in design. They also include causes of action for deceptive trade practices, common-law fraud, and negligence. The plaintiffs are demanding that the company replace the locks, pay compensatory damages, and even turn over all of its profits made from the locks. This demand is made in spite of the fact that Kaba has reportedly already developed an upgrade to solve the problem, which it now utilizes and reports could be effectively applied to existing installations. In any event, the plaintiffs are represented by three heavy hitters in the legal community, including Louisiana based attorneys Richard J. Arsenault and Daniel E. Becnel Jr., and Los Angeles-based Mark Geragos (the “celebrity lawyer” who has represented Winona Ryder, Scott Peterson, and musician Chris Brown, among others).

The Kaba locks at issue are widely used within hospitals, airports, casinos, banks, retail stores, jails, and even within the Department of Defense. But interestingly, the lead plaintiffs are not government officials or business owners, but are Orthodox Jews who use the push-button locks on their homes so they can secure their homes without use of a key. During observance of the traditional Sabbath from sundown Friday to nighttime Saturday, adherents do not leave their homes with anything in their pockets. This has made the keyless locks a popular solution.

To date, the plaintiffs have not identified any criminal acts such as robberies that have occurred as a result of any breach of a lock. There still has been some harsh criticism against Kaba, though, by those who claim that the company has essentially taken the position that all locks are capable of being breached; they also point out that the company has not proactively offered to replace or fix the previously sold locks. Another writer at Forbes notes [link includes video of magnetic breach] that Kaba has taken the issue seriously and moved to fix it in its current models, but question why it has not published a warning in the media.

While it sounds like a good idea to alert consumers of the potential breach, though, this similarly would alert the public-at-large that the locks are capable of an “easy” breach. It certainly is a difficult situation to navigate for the company, which likely will be faced with significant costs no matter which path it chooses.
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Thursday, April 7, 2011

FDA Convenes Expert Panel to Consider Food Dye-ADHD Link

Last week, a Food and Drug Administration advisory panel composed of doctors, scientists, and consumer representatives spent two days reviewing evidence that purportedly shows a link between synthetic food colorings and ADHD, or hyperactivity, in kids. Artificial dyes are added to many familiar snack and junk foods – staples of the modern diet. This alleged link has been the subject of ongoing debate for decades, pitting the food industry against parents, public watchdog groups and academics who have demanded a closer look at food additives.

Businessweek reports that the FDA believes there is not enough evidence at this point to definitively conclude whether food dyes contribute to ADHD. The panel’s task thus was not to consider imposition of a ban on the additives, but rather to consider whether foods should require warning labels or whether more research should be done. Well, the panel has spoken. CBS News reports that although the panel recommended that the FDA further study the possible link, it voted 8-6 that warning labels are not necessary. There is not enough evidence at this point, according to the panel, to show any link. As it stands, packages must list the food colorings on its labeling, but no warnings about a potential link to hyperactivity are required.

Interestingly, across the ocean, where this issue is already “old news,” the European Food Safety Authority has already mandated that foods with color additives contain warning labels for consumers. Here at least, additional regulation may be on the horizon, but not soon. One last thought: Perhaps it’s not the color additives that instigate the alleged behavioral problems, but the overall quality of the snack and junk foods, their sugar content, or even the lifestyle choices of the families that purchase said food in order to appease the sweet teeth of their children.

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Wednesday, March 30, 2011

Defense Verdict: Jury Finds Vehicle Defective But Driver At Fault

In a case the judge reportedly called the biggest civil trial in the history of the county, an Ohio jury on March 21 rendered a verdict in favor of the defendant, Yamaha Motor Corp., in a $20 million case involving the death of a 10 year-old girl, in spite of its conclusion that the ATV at issue was defective in its design or warnings. The machine at issue was Yamaha’s Rhino. AboutLawsuits.com reports that this was the sixth case won at trial by Yamaha over claims that its ATV is prone to rollovers; however, it reports that Yamaha settled more than 100 others.

The facts of the case were quite sad. It was reported by the local news that the 10 year-old plaintiff riding in the Rhino at a 2007 church picnic. The 21 year old driver, according to the defense, was inexperienced with the machine. He attempted to perform a high-speed “fishtail” stunt maneuver in a dark, muddy cornfield with multiple unhelmeted child passengers. The driver was not sued in the civil action but pleaded no contest to criminal charges.

It is refreshing to see that jury members, in spite of the tragic underlying facts of the case involving death of a child, seriously and thoughtfully deliberated as to what they believed was the true cause of the injury. This case is reminiscent of another case in Texas, which we covered here, involving very similar facts with a very different outcome. There, an 18 year-old Texas man was boating and swimming with friends when the driver of the boat, another 18 year-old, put the boat in reverse, striking his leg with the propeller. It eventually resulted in the loss of his leg.

The Texas plaintiff sued the makers of the boat, alleging the propeller was defectively in its design. The Texas jury did not believe that the actions of the driver, who was not named as a defendant, was a superseding cause of the injury. It attributed only 17 percent of the negligence to the driver, and ultimately awarded the plaintiff $3.8 million in damages for the loss of his leg. These cases are further proof that with a jury, it’s always a gamble.
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Tuesday, March 29, 2011

"Greenwashing" Litigation in California

In November 2011, a California federal court is scheduled to preside over a significant “greenwashing” class action lawsuit which was filed against S.C. Johnson & Son, Inc. by a California resident on behalf of purchasers of various household products manufactured by the company. Koh v. S.C. Johnson & Son, Inc., No. C-09-00927 RMW (N.D. Cal.). “Greenwashing” is a term used to describe the deceptive use of “green” marketing to promote a misleading perception among buyers that a company’s products are environmentally friendly.

In January 2008, S.C. Johnson, the maker of household cleaning products including Windex and Shout stain remover, began marketing and selling Windex with its prominently displayed, trademarked “Greenlist” labeling. It later incorporated the Greenlist label on other products, including Shout. The company devloped this system internally to rate its products in terms of their impacts on the environment. The plaintiffs alleged that the Greenlist label was deceptively designed to look like a third party’s seal of approval, which it is not. They further alleged that “among today’s environmentally-conscious consumers, products seen as ‘green,’ or environmentally friendly, often command a premium price and take market share away from similar, non-‘green’ products.” The plaintiffs claimed that had they known the Greenlist label was the result of the company’s own review process, they would not have purchased them.

Before the class-certification stage, S.C. Johnson moved to dismiss the complaint on two grounds: (1) that the plaintiff had not sufficiently alleged an injury; and (2) no reasonable consumer could have found the Greenlist label misleading. That motion to dismiss was denied by the California federal court in a five-page, unpublished order in January of 2010. Koh v. S.C. Johnson & Son, Inc., 2010 WL 94265 (N.D. Cal. Jan. 6, 2010).

This will be an important case to watch, as it could have significant implications on acceptable “green” marketing practices. In fact, the class-action suit should serve as a warning to product makers to be cautious in advertising their products as “green” or environmentally friendly, especially where that representation is not supported by a credible third party.

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Monday, March 21, 2011

Juror’s Failure to Disclose Family Member’s Similar Injury Involving Similar Product Did Not Warrant New Trial

Last month, a New York federal court ruled that a prospective juror’s alleged failure to disclose in a products liability suit that a family member of his had been injured under circumstances similar to the plaintiff’s, while using the same product, did not warrant a new trial. Leibstein v. LaFarge North America, Inc., — F. Supp. 2d—, No. CV-06-6460, 2011 WL 499952 (E.D.N.Y. Feb. 14, 2011). The case involved a plaintiff who allegedly suffered third-degree burns to his knees while laying a portland cement product in his basement. He filed suit on theories of strict liability and negligence, and his wife joined the suit with a claim for loss of consortium.

The jury returned a verdict in favor of the plaintiffs in the amount of $125,400. Interestingly, it was the plaintiffs who alleged that a new trial was warranted based on the juror’s alleged failure to disclose during voir dire a similar injury to a family member. The Court noted that the request “presumably was triggered by plaintiffs’ disappointment as to the size of the award.”

The plaintiffs’ motion for a new trial was based largely on information supplied in an affidavit authored by the injured plaintiff’s wife. According to her submission, she spoke with several jurors following the trial during which time she became aware of facts previously undisclosed. Specifically, she learned from these jurors that another juror, “juror number four,” had disclosed during deliberations that a member of his family similarly had been burned while using a portland cement product. The juror failed to disclose this information, in spite of the fact that this information was responsive to questions asked of the jury panel on voir dire.

One might initially wonder on what theory the plaintiffs would hang their hat. It certainly seems as though the defendant would be most prejudiced by the fact that a juror’s family member was injured in the same way as the plaintiff allegedly was. The plaintiffs’ theory was this: “Most probably, this person did not bring a lawsuit or receive any compensation” and, accordingly, the juror was unsympathetic to plaintiffs’ claims. Although it is unclear what damages were submitted by the plaintiffs to the jury, it certainly doesn’t seem that $125,400 was entirely “unsympathetic.” In any event, the court disagreed with the plaintiffs’ allegation that had this information been disclosed by the juror, there would have been valid basis for a challenge for cause.

Thus, the court held that a new trial was not warranted, and the verdict should stand. The court based its ruling on the fact that there was no dispute at trial that an improper use of portland cement could cause burns. This was therefore not an issue at trial. Rather, the “crux of the liability dispute” was whether the packages of cement purchased by the plaintiff contained adequate warnings of that hazard. Accordingly, the information was not sufficient to warrant a new trial. Furthermore, the court held the “sketchy, second- and third-hand information” provided by the plaintiffs did not warrant a post-verdict inquiry into the juror. The court concluded instead that the $125,400 “verdict fits comfortably within the realm of reasonableness.”

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Thursday, March 10, 2011

King of Torts Dethroned

Stanley Chesley, a class-action plaintiffs’ lawyer who became rich and famous for collecting billions of dollars for his clients in various lawsuits throughout his career, is now facing disbarment, the possibility of paying back $7.5 million in fees, and, arguably worse, a “professional death sentence.” The so-called “Master of Disaster” reportedly built his career around a simple strategy: swoop in after a disaster, round up as many clients as possible, and launch a “legal assault” against as many of the deep-pocketed bad guys as possible. How might one who follows such a business model go astray? He allegedly got greedy, with conduct his hearing officer called “shocking and reprehensible” behavior related his keeping far more than his share of a $200 million product liability settlement in Kentucky.

The case at issue was a 1998 class-action lawsuit involving the now withdrawn anti-obesity drug fen-phen, which consisted of more than 400 plaintiffs and was pending in Kentucky’s Boone County. The Wall Street Journal Law Blog reports that Chesley was not initially involved in the litigation, but at some point “muscled” his way into the case and strong-armed the attorneys into sharing fees with him in exchange for his “expertise” in handling class actions. Apparently, though, those attorneys did not notify the plaintiffs of the new arrangement.

The suit eventually resulted in a $200 million settlement with the maker of fen-phen, of which the plaintiffs’ lawyers reportedly kept tens of millions of dollars more than permitted. Of the total settlement, Chesley reportedly received a $20 million fee for his helping settle the case, including a reported additional $4 million for convincing the sitting judge to increase the attorneys’ take on the settlement to 49 percent. That judge later resigned from the bench when it was discovered he allegedly took financial benefit from the settlement in a secret deal.

Of the four plaintiffs’ attorneys involved in that case, three faced criminal charges of fraud and conspiracy. Two were sentenced to 25 and to 20 years in federal prison. As reported at Overlawyered, at the time of those guilty verdicts, it was a mystery as to why Chesley was not similarly charged. Despite that omission, Kentucky’s trial commissioner recently issued his opinion that Chesley should lose his Kentucky law license permanently and return more than $7.5 million in fees collected in the settlement.
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Tuesday, February 22, 2011

Suit Alleges "Harmful and Dangerous" Bra Caused Plaintiff’s Permanent Skin Discoloration

Our beautiful home state of South Carolina is no stranger to unusual lawsuits. See here, for example, for coverage of one of our inmate’s “$63,000,000,000 billion dollar” lawsuit against Michael Vick. But there are other unique suits. A South Carolina product liability lawsuit filed in late January, though far from the level of absurdity of the Vick suit, arguably qualifies as odd.

Charleston’s The Post and Courier reports that a Berkeley County woman has filed suit, just shy of the three-year statute of limitations, against Hanes Corporation and Wal-Mart Stores, in which she alleges that a black bra she purchased at her local Wal-Mart permanently discolored her skin. The story has generated some considerable discussion among South Carolinians, who have posted many, many comments to the article. The “odd product performance” complaint sets forth negligence, breach of warranty, strict liability, and failure to warn causes of action, and alleges that the plaintiff “could not appreciate the danger the Hanes bra posed to her.”

According to the complaint, the plaintiff bought the black Hanes bra at Wal-Mart, wore it, and noticed a dark discoloration of the skin on her shoulders tracing exactly where the straps had been. Her local attorney, Jarrell Wigger, apparently granted an interview to The Post and Courier after filing the claim. He told the newspaper that the dyes used in the Hanes bra were defective, allowing them to “bleed out,” leaving his client with “skin discoloration [that] is permanent and persists to date.” He described the skin discoloration as “burnt” or dark in color.

We will continue to monitor the case for any interesting developments. For us, it’s the “permanent” part that doesn’t seem to make sense. Sure, it’s foreseeable that a new pair of unwashed dark jeans or unwashed bathing suit might “bleed out” onto a wearer’s skin, but to be absorbed by the skin permanently just seems unlikely. Then again, if this plaintiff still has the markings more than three years after her first wear, maybe her situation is, indeed, unique.
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