June 14, 2013

The road to the tort underworld is paved with innovator liability

By Anastasia P. Boden Attorney

Tapping their seemingly endless supply of ingenuity, plaintiffs’ lawyers have come up with a new legal theory for reaching deep pockets, and just the name would send chills up the spine of Steve Jobs, Henry Ford, or Jonas Salk.  Under the theory of “innovator liability,” manufacturers of brand-name drugs can be held liable for injuries caused by the drug’s generic counterpart.  In January, the Alabama Supreme Court became the first state high court to adopt the theory, but this week the court granted the defendant’s request for rehearing.

In innovating innovator liability—a concept utterly foreign to tort law—plaintiffs’ lawyers are trying to fill in the liability gap created by the Supreme Court’s decision in PLIVA v. Mensing.  In that case, the Supreme Court held that manufacturers of generic drugs could not be held liable under state law for “failure to warn,” because the FDA requires them to provide the same warnings as their brand-name counterparts.

Thus in Wyeth Inc. v. Weeks, the plaintiff sued Wyeth for injuries caused by a generic version of the drug Reglan.  The court held Wyeth liable on the theory that it was foreseeable that users of the generic drug would rely on Wyeth’s statements about Reglan.  But a generic manufacturer’s use of a brand-name drug’s warning is not inevitable, rather, it’s a product of laws over which manufacturers have no control.  Further, Wyeth exited the market in 2002.  The foreseeability of liability for a plaintiff’s reliance on statements about a drug they did not even ingest over ten years after the maker leaves the market is highly dubious.

If innovator liability sounds far-fetched, that’s because it is.  Courts across the country—by some counts, over 80—have rejected it as contrary to the basic tenets of tort law.  As Justice Glenn Mourdock said in his dissent in Weeks, notions that “parties are responsible for their own products, not those of others, are so organic to western economic and legal thought that they rarely find need of expression.”  Naturally a district court in California, the worst place for civil justice in the nation, is one of the only courts that has accepted innovator liability.

Innovator liability disincentivizes innovation, eviscerates the legal requirement of causation, and raises serious due process concerns.  But it’s a natural progression in the trend of trying to hold some party liable for any harm that results—and usually the party with the deepest pockets.  Often it seems that “there’s a lawsuit for that” is the new “there’s an app for that.”  And if there’s not, plaintiffs’ lawyers will create one.  Someone must pay.

But should America become a place where the motto is “innovators beware”?  One hopes that Alabama—despite being the state that spawned the infamous case of BMW v. Gore—will reconsider.  Until oral arguments are heard in September, the spectre of innovator liability hangs over Alabama.                                            

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