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SUPREME COURT OF PENNSYLVANIA

The Supreme Court of Pennsylvania is at a crossroads – the Court is considering several important cases that will have a lasting impact on the state’s litigation environment. In recent years, both the intermediate appellate courts and the state’s high court have issued liability-expanding decisions and have swung courtroom doors open to out-of-state plaintiffs whose claims have no connection to the state. As more key cases reach the state high court, it once again will have to choose whether to adhere to traditional principles of tort law and follow statutory law, or accept the plaintiffs’ bar’s invitation to expand liability and welcome more lawsuits to Pennsylvania.

THOUSANDS OF RISPERDAL CASES REINSTATED

Statutes of limitations exist to ensure that the civil justice system evaluates liability promptly, not years or decades after the alleged conduct occurred. That principle took a hit this November, when the Supreme Court of Pennsylvania effectively reinstated thousands of Risperdal cases that were filed long after plaintiffs were on notice that the antipsychotic medication came with a small risk that boys could experience gynecomastia, which causes breast growth.

CLC Judge Arnold New had found that by June 2009 plaintiffs would have had notice of the risk as a result of medical literature, newspaper articles, and, of course, attorney advertising. A state appellate court ruled that plaintiffs should have been aware of the cause of their injuries even earlier, as the manufacturer added information about the risk of gynecomastia to the medication’s label on October 31, 2006. Any claim not filed within two years of that date, the appellate court found, would be barred by the statute of limitations and dismissed.

In a pair of rulings in Saksek v. Janssen and Winter v. Janssen, however, the Supreme Court of Pennsylvania reversed the lower courts and adopted an everything-goes-to-trial approach. The high court ruled that trial courts cannot determine when the clock for filing a claim begins based on objective evidence of public knowledge of the risk involved, but that juries must decide whether the statute of limitations has run on a case-by-case basis. While the high court ruling involved just two cases, it has much broader implications. Thousands of Risperdal cases in the CLC, the No. 1 Judicial Hellhole, had been placed on hold due to the time frames established by the lower courts. Those late-filed cases can now move forward. Of course, few Risperdal cases are likely to actually reach trial, especially after the jaw-dropping $8 billion award in a CLC Risperdal case in October. Rather, the effect of the ruling is to increase the pressure to settle all of the lawsuits.

“ It is not the court’s role to upend duly enacted legislation simply because we might sometimes deem it imperfect or unwise.”
– Justice David Wecht

EXPANSION OF MEDICAL LIABILITY

A RETURN TO FORUM SHOPPING IN MEDICAL LIABILITY CASES?

Constraints that have prevented lawyers from picking the most plaintiff-friendly jurisdiction for filing medical liability actions are in jeopardy.

In late 2018, the Supreme Court of Pennsylvania’s Civil Procedure Rules Committee proposed easing the court’s 17-year-old restraints on medical liability lawsuits. At issue was a 2002 court rule that required plaintiffs to file medical malpractice lawsuits in the county where the error occurred, not where a jury might view the claim most favorably. The purpose was to reduce forum shopping and create a more fair and balanced playing field. Forum shopping increases the number of meritless lawsuits and drives up doctors’ insurance costs. It leads to increased costs for patients and reduces patients’ ability to access doctors.

The Committee’s new recommendation would allow attorneys to file suit for medical malpractice in jurisdictions not only where medical treatment took place, but also where the healthcare provider operates a hospital or office or where a physician lives, among other options. Of course, the state’s personal injury bar, through the Pennsylvania Association for Justice, supports the change. Plaintiffs will flock to areas like Philadelphia, the No. 1 Judicial Hellhole in 2019, where juries are more willing to award higher verdicts in favor of plaintiffs.

At the urging of Pennsylvania legislators, the Court agreed to postpone further consideration of the amendments until 2020.

EXTENDED TIME TO SUE IN MEDICAL LIABILITY CASES

In Yanakos v. University of Pittsburgh Medical Center, the Supreme Court struck down the state’s seven-year time limit to bring medical liability claims. The Court said the statute was “not substantially related to lawmakers’ goal of keeping health care costs down.” It said it was unconstitutional because it does not allow all injured patients to “exercise their constitutional right to a remedy.”

As pointed out in the dissent by Justice David Wecht, the Court substituted the policymaking authority of the legislature with the decision. “It is not the court’s role to upend duly enacted legislation simply because we might sometimes deem it imperfect or unwise,” he said.

Plaintiffs urged the Supreme Court to adopt an exception to the state’s seven-year time limit to bring medical liability claims. There, the plaintiffs filed a lawsuit 12 years after a failed liver transplant, and said that they had not discovered the patient’s medical condition until after the seven-year period expired. While the legislature carved out other exceptions to the statutory period, and had not done so for this situation, the plaintiff asked the court to find the statute unconstitutional and create its own exception.

The intermediate appellate court properly rejected this invitation, finding the seven-year statute of repose reasonable and in line with the government’s interest in promptly determining whether there was medical negligence. Creating an exception and extending this period, the court ruled, “would expose health care providers to further liability, undermining the equally legitimate government interest of keeping medical professional liability insurance affordable for the benefit of citizens of this Commonwealth.”

ABILITY TO CONSULT WITH OUTSIDE PROFESSIONALS

A recent Supreme Court of Pennsylvania decision provides guidance to lawyers who consult with crisis management and other professionals.

In June 2019, Pennsylvania’s high court ruled in BouSamra v. Excela Health that a client waives the attorney-client privilege, and its otherwise confidential communications with its lawyers can be disclosed, when its lawyer shares those communications with a public relations firm. However, the broader privilege for work-product protection, which prevents disclosure of the mental impressions of the attorney, may still apply. To decide whether this protection is available, a court must decide on a case-by-case basis whether the disclosure significantly increased the likelihood of an adversary or potential adversary obtaining the information.

Attorneys frequently rely on advice from other professionals and must be able to speak candidly with them. Pennsylvania lawyers will need to closely consider the decision and take steps to guard against a waiver of privilege.

HIGH COURT EXPANDS GOVERNMENT LIABILITY

In late December 2018, the Supreme Court of Pennsylvania held a school district liable for a student running into an unpadded concrete wall in a gym, even though governmental immunity usually protects schools from lawsuits. The Court stated that this incident fell under the real property exception to governmental immunity under Pennsylvania’s Tort Claims Act and thus the school was not granted immunity.

Also, in December 2018, the Supreme Court of Pennsylvania ruled, in Justice v. Lombardo, that a state trooper accused of using excessive force during a traffic stop is not immune from a civil lawsuit seeking damages. The Court reasoned that a reasonable jury could find that the trooper acted outside the bounds of his duties and sovereign immunity did not apply. As Justice Sally Mundy observed in her dissent, “[t]he consequence of the Majority’s decision today will be to introduce a chilling effect on troopers performing their duties.”

KEY RULINGS EXPECTED IN 2020

WILL THE SUPREME COURT CLOSE THE DOOR TO OUT-OF-STATE DEFENDANTS?

In April 2019, the Supreme Court of Pennsylvania granted review of an appeal with wide-reaching ramifications for the state’s litigation environment. Pennsylvania courts have been slow to apply the U.S. Supreme Court’s 2017 ruling instructing state courts to dismiss cases that have no connection to the state. In Bristol-Myers Squibb Co. v. Superior Court of California, the Court held that a state cannot exercise personal jurisdiction over a company that is not incorporated or headquartered in that state, when the plaintiffs do not live in the state, and events related to the alleged injury did not occur there.

The first opportunity for a Pennsylvania Superior Court to properly apply the Bristol-Myers Squibb (BMS) ruling on claims brought by out-of-state plaintiffs was in Hammons v. Ethicon. The facts were similar to BMS — an out-of-state plaintiff brought suit in Philadelphia against Ethicon and its parent company, Johnson & Johnson, neither of which are incorporated or headquartered in Pennsylvania. The plaintiff did not receive medical treatment in Pennsylvania, and all relevant actions related to her claim alleging a pelvic mesh device was defective took place where she lived, in Indiana, or where Ethicon is based, in New Jersey.

The only connection between the parties and Pennsylvania was that Ethicon contracted with a Pennsylvania company to “design, test, and manufacture” the mesh and the plaintiffs’ lawyer decided it would be a more favorable jurisdiction. Doing business with third parties does not automatically subject an out-of-state business to personal jurisdiction where that company is located unless there is a specific connection between the forum and the injury. The U.S. Supreme Court in BMS held that the “bare” decision to contract with a California company to distribute the drug nationally did not provide a sufficient basis for jurisdiction in California. As in BMS, Ethicon’s link to a Pennsylvania company should not have provided a sufficient basis for a Pennsylvania court to decide the case.

Nevertheless, in June 2018, the Superior Court, one of two intermediate appellate courts in Pennsylvania, declined to throw out a $12.8 million judgment reached in Philadelphia’s mass tort program in late 2015. The court never explained how a third party’s actions specifically contributed to the plaintiff ’s specific injury.

The Supreme Court of Pennsylvania has the opportunity to realign the state with U.S. Supreme Court precedent. ATRA urges the Court to display leadership by giving clear guidance to lower courts to end litigation tourism.

WILL THE COURT REQUIRE DEFENDANTS TO PAY MORE THAN THEIR FAIR SHARE IN ASBESTOS AND OTHER PRODUCT LIABILITY CASES?

In March 2019, the Supreme Court of Pennsylvania held oral arguments in an appeal of a Superior Court decision holding that a state law that allocates liability in proportion to a defendant’s level of responsibility for an injury, known as the Fair Share Act, applies to asbestos cases.

The Superior Court reversed a Philadelphia Court of Common Pleas ruling that exempted asbestos cases from the same rules for allocating fault that apply in other cases. Without such a rule, a single business that is found to have contributed to a plaintiff ’s exposure to asbestos could end up having to pay the entire damage award, even if the plaintiff ’s exposure was caused largely by others. Under the Fair Share Act, a defendant can be required to pay the full award only if found more than 60 percent responsible. In addition, the ruling more broadly could exempt other strict product liability cases from the Fair Share Act.

The Supreme Court also will have the opportunity to require plaintiffs to provide the court with any evidence of bankruptcy trust claims or settlements. The Superior Court appropriately held that when a jury apportions fault among potentially responsible parties, the Fair Share Act requires that they consider evidence of any settlements by the plaintiffs with bankrupt entities. Ideally, the Supreme Court should require plaintiffs to provide all evidence of past and future bankruptcy trust claims and settlements, or consider them waived. If the high court does not do so, or worse, blindfolds juries from considering such settlements, passing a law to provide transparency in claims made against asbestos-related bankruptcy trusts will become even more critical.

WHAT IS THE TRIAL COURT JUDGE’S ROLE AS GATEKEEPER?

In October 2019, the Supreme Court of Pennsylvania held oral arguments in a case that will explore the role of a trial court judge as a gatekeeper over the reliability of expert testimony.

The issue arose in a wrongful death suit that attempts to connect a golf course groundskeeper’s development of Acute Myelogenous Leukemia (AML) to his exposure to pesticides. In Walsh v. BASF Corp., the Allegheny County Court of Common Pleas excluded the plaintiff ’s causation experts’ testimony, finding they failed to offer a study tying AML to the chemicals at issue. Their proposed testimony, the trial court found, was not supported under the Frye standard, which requires that experts follow methods generally accepted by the scientific community. However, in May, the Superior Court reversed that decision, ruling that the trial court went beyond examining the expert’s methods and improperly considered whether the studies supported the witnesses’ conclusions.

The superior court’s decision incorrectly denied that trial courts can exercise any role as gatekeepers in determining whether expert testimony is generally accepted under Frye. The court stated Pennsylvania law requires that particular products must have caused specific injuries, not that a product generally, pesticides, may cause cancer. The Supreme Court of Pennsylvania should firmly establish that trial court judges have a duty to carefully scrutinize the scientific basis of proposed expert testimony and not permit unsupported theories to be presented in court.

DOES STRICT LIABILITY APPLY TO CONSUMER LAWSUITS?

The Supreme Court of Pennsylvania is considering whether the catchall provision of the state’s consumer protection law, which prohibits any deceptive conduct, imposes strict liability regardless on a business regardless of whether it acted intentionally, negligently, or innocently.

Gregg v. Ameriprise arises from a judgment for plaintiffs who alleged that a financial advisor misled them into buying life insurance policies. The Superior Court upheld the award.

The lower courts concluded that the legislature intended to transform the catchall provision from one requiring proof of fraudulent intent to one that renders state of mind irrelevant and imposes strict liability. By relying on the perceived purpose of the statute rather than its actual language, however, the court reached a result that is wholly inconsistent with the statute’s plain meaning and legislative history.

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