Orphan drugs: the question of products liability

Orphan drugs, essential for the treatment of persons with rare diseases, generally are unprofitable for manufacturers to develop and market. While congressional and administrative efforts to promote the development of orphan drugs have met with modest success, application of products liability doctrine to orphan drug sponsors could subvert those efforts. This Note describes the provisions of the Orphan Drug Act and analyzes products liability law with respect to orphan drug litigation. It argues that the goals of tort law support the imposition of liability for design defect, failure to warn and negligence in testing. Finally, the Note acknowledges that liability costs create disincentives for orphan drug development and suggests mechanisms for reducing manufacturers' liability concerns.     

Inducing corporate compliance: A compound corporate liability regime

Corporate liability regimes have two major social goals: (i) inducing corporations to internalize all social ramifications of their activity; and (ii) inducing corporations to prevent, deter, and report their employee misconduct. The scholarly polemic has shown that none of the liability regimes recognized thus far in the literature efficiently satisfies both social goals. Following a Law and Economics approach, this paper develops an innovative regime that may comprise an optimal corporate liability framework in most settings. The Compound Corporate Liability Regime developed in this paper is a two-layer strict liability regime. Under this regime, corporations that self-report their employee misconduct incur a sanction that is reduced by the variable enforcement costs saved due to their self-reporting. Such a liability framework aligns social and corporations’ interests, and thereby satisfies both social goals of corporate liability regimes.     

Gynaecological cytopathology and the search for perfection: civil liability and regulatory ramifications

The article analyses the potential for false negative and false positive results from Pap smear testing by gynaecological cytopathology laboratories. It also reviews case law in relation to the liability of general practitioners, gynaecologists, cytoscreeners and pathologists in respect of cervical cancer diagnoses. It argues that the concerns expressed in the 1990s about unfair findings of liability against cervical screeners have not been borne out, liability only having been found by the courts where culpable failure to adhere to the standards to be expected of professional behaviour has been established by probative evidence. It argues that the challenge for the future is for cytology screening to articulate definitively where the distinctions lie between acceptable and unacceptable error and for the medical profession and the legal profession to accommodate to the limitations of gynaecological cytopathology.     

Statutory interpretation, capture, and tort law: the regulatory compliance defense

The regulatory compliance defense holds firms liable whose productsor product warnings fail to satisfy federal regulatory standards,but does not exculpate firms that comply. Rather, complianceis relevant evidence for a jury to consider in a products liabilityaction. This article argues that the defense should exculpatecompliant firms as a matter of law. A Congress that thoughtabout the matter would prefer this judicial construction ofan unclear safety statute. To defend this view, the articleargues that a legislature can have intentions in a normativelymeaningful sense, that claims that a Congress or its agenciesare captured by special interests should be nonjusticiable,and that, when a court is in doubt as to what a legislatureintended, it should adopt that construction of the relevantstatute that would be easiest for the legislature to correctif the court errs. In this case, it is easier for Congress tocorrect a construction that it intended to exculpate compliantfirms than a construction that it did not.     

Putting fault back into products liability: A modest reconstruction of tort theory

This paper postulates that the proper function of tort law is to provide protection from, and redress of, non-consensual invasions of individual rights of person and property. It then proceeds to analyze and criticize, in that context, several theories of the law of unintentional torts including traditional English negligence law and the models of Posner, Fletcher and Epstein. That analysis proceeds in terms of the answers of each theory to a uniform set of questions which must be answered by any theory of the law of unintentional harms. The paper concludes that none of the theories examined is rights-based or, indeed, consistent with the existence of individual rights of person and property.The paper goes on to elucidate a theory of liability which is rights-based. That theory turns out to be variant of traditional English negligence law in which reasonable foreseeability of harm to legally recognized rights or interests is the sole criterion of liability, the burden of precautions on the agent of the harm being explicitly excluded from consideration.Finally, the rights-based theory is applied to the area of products liability. It is demonstrated that this area of the law of unintentional harm does have the same moral foundations as the general law of negligence so that resort to the anomalous, and amoral, constructs of fictitious warranties, strict liability, enterprise liability and the deep pocket is neither appropriate nor necessary.     

Comment: litigation involving manufacturers' liability for defective medical products: judicial perspectives.

In this Comment, Judge Rosenn discusses, from a judicial perspective, the development of manufacturer's liability for defective medical products, with particular attention to the evolution of the strict liability doctrine, the courts' willingness to apply that doctrine to medical manufacturers, and recent suggestions for seriated trials as a means of more effective resolution of the complex litigation that arises in cases of alleged faculty design of medical products.     

Assessing the consequences of corporate discretion on regulatory compliance: the case of motor vehicle safety in Canada

What are the consequences of discretion when government shares the responsibility for regulatory compliance with the industry subject to regulation? Do differing underlying goals affect implementation? This article examines the implementation of Canada's Motor Vehicle Safety Act for fiscal years 1974–75 to 1981–82. Since the law creates opportunities for the exercise of discretion and those responsible for implementation (government versus industry) do not share the same underlying goals, one can expect that who implements the act will be of considerable importance. The data suggest that when incentives for compliance differ, discretion creates the opportunity for substantially different outcomes. Notable differences exist in the characteristics of recalls that manufacturers initiated and those that Transport Canada influenced.     

Beshada v. Johns-Manville Products Corp.: the function of state of the art evidence in strict products liability

In Beshada v. Johns-Manville Products Corp., the Supreme Court of New Jersey held that a state of the art defense is unavailable in cases brought under a theory of strict liability for failure to warn. The court indicated that asbestos producers may be held liable for their products' harms even if the health hazards of asbestos were unknown and not discoverable when the products were marketed. In a subsequent case, the New Jersey court held that state of the art evidence is relevant to whether a product is defective. This Case Comment examines these different uses of knowledge evidence in the disposition of products liability cases. It contends that manufacturers should not be held liable for unknowable risks. The Comment concludes that the state of the art defense establishes a logical limit on strict liability and promotes efficient resolution of products liability claims.     

Scope of liability: the vanishing distinction between negligence and strict liability

The duty-of-care requirement cannot be used anymore as the touchstone to differentiate negligence from strict liability because it can be found in many forms of the latter. Duty of care is smuggled into strict liability hidden under the scope of liability requirement (traditionally called “proximate causation”). As far as the scope of liability requirement is common to negligence and to many forms of strict liability, there is a fairly large common ground to both liability rules, and consequently the marginal Hand formula is applied to both rules. Indeed, under a negligence rule, the marginal Hand formula is applied twice: first to assess whether or not the defendant did breach his or her duty of care, and, second, to delimit whether or not the defendant’s behavior was a proximate cause of the harm suffered by the victim. However, under a strict liability rule, the Hand formula is applied only once when the proximate causation question is raised. Traditional law and economics analysis has almost always taken the normative question raised by the causation requirement as given, which is a potential major problem due to the importance of scope of liability or proximate causation in legal practice. Defining the scope of liability, that is to say, the boundaries of the pool of potential defendants, is the basic legal policy decision for each and every liability rule. In the normative model presented in this paper, the government first chooses efficient scope of liability, and given the scope of liability, the government then decides the liability rule and damages that guarantee efficient precaution. In the article, most known scope of liability rationales developed by both common law and civil law systems are discussed in order to show the substantial common ground between negligence and strict liability.     

Robotic prostheses as products enhancing the rights of people with disabilities. Reconsidering the structure of liability rules

The term ‘robot’ refers to a wide variety of devices, serving very different purposes. The case of robotic prostheses is considered here. After defining such devices, and briefly describing the technical peculiarities that characterize their functioning and distinguish them from traditional implants, their relevance with respect to the fundamental rights of people with disabilities is considered. Pursuant to the United Nations Convention on the Rights of Persons with Disabilities, a claim is made that favouring the development of said applications may be required to subscribing states. In light of such considerations, the liability regime – namely that emerging from the Defective Product Directive – is analysed, in the attempt to determine – with a prospective analysis – the impact that said rules are likely to have on their development. The technology-chilling effect and the anticipated extremely complex evidentiary burden the user would have to face in order to obtain compensation lead us to conclude that legal reform is advisable. Some alternatives are considered, and in particular that of the development of a – partially – state-funded no-fault plan, intended to allow more ex ante certainty for producers and researchers (favouring the development of said devices), and prompt and adequate compensation to the victim in case an accident occurs.