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Article: March 2018: Opioids and Guns: Claims of Public Nuisance – Who May Be Liable

Business Litigation Reports

Two issues of importance to product liability lawyers—and indeed the public at large—have dominated recent news cycles: the opioid abuse crisis and the scourge of school gun violence. When crises like these arise, the question of who is responsible for the resulting harms is typically resolved in the courts, but often turns on thorny issues of public policy and the political will of legislators. For certain industries, like gun and vaccine manufacturers, Congress has sought to shield them from exposure in the courts through grants of a limited form of immunity. Other industries like the tobacco industry were not so protected and the courts were used to resolve the scores of claims brought against its members by various states and municipalities.

In the case of the current opioid crisis, dozens of cities, states, municipalities and third-party payors are seeking to hold the pharmaceutical companies who manufacture FDA-approved prescription opioid medications and the companies that distribute them responsible for the consequences of opioid abuse, which in large part involves the use of illegal street drugs, such as heroin and fentanyl. Plaintiffs claim defendants created a public nuisance and they seek a wide spectrum of injunctive relief and damages, including costs for law enforcement, addiction
treatment, and hospital care. See, e.g., City of Cleveland v. AmerisourceBergen Drug Corporation, et al., No. 1:18-op-45132 (N.D. Ohio Mar. 6, 2018). The claims in these lawsuits could potentially make these and other FDA-approved medications unavailable to patients suffering from pain. This article examines how the courts and lawmakers have treated manufacturers facing potentially catastrophic liabilities, often resulting from the lawful use of their products.

Gun Manufacturers
In the case of the gun industry, after several lawsuits sought to hold its members liable for  wrongful death and public nuisance, the industry lobbied Congress for protection, claiming that such suits could bankrupt it, thus imperiling the nation’s ability to manufacture weapons for  the military. Those efforts were successful: Congress passed and President George W. Bush signed the Protection of Lawful Commerce in Arms Act (“PLCAA”) in 2005 and codified at 15 U.S.C. §§ 7901 et. seq., which provides immunity to firearm and ammunition  manufacturers and sellers from civil or administrative claims “resulting from the  criminal or unlawful misuse” of firearms or ammunition. There are six limited exceptions to this immunity, including exceptions for negligent entrustment claims and actions where a manufacturer or seller knowingly violates a state or federal statute applicable to the sale or marketing of firearms or ammunition (the “predicate exception”).

The PLCAA has survived multiple constitutional challenges, e.g., Ileto v. Glock, Inc., 565 F.3d 1126 (9th Cir. 2009), City of New York v. Beretta U.S.A. Corp., 524 F.3d 384 (2d Cir. 2008), and has been relied on by gun manufacturers to obtain dismissals of common law tort actions, e.g., Delana v. CED Sales, Inc., 486 S.W.3d 316, 321 (Mo. 2016), reh’g denied (May 24, 2016), general negligence claims, e.g., Jefferies v. District of
Columbia, 916 F. Supp. 2d 42 (D.D.C. 2013), public nuisance claims, e.g., Ileto, 565 F.3d 1126, and design defect claims based on a failure to install safety features on firearms, e.g., Adames v. Sheahan, 233 Ill. 2d 276 (2009). Several of these now dismissed claims were brought by family members of individuals killed in public shootings, including victims of the D.C. Sniper and the Aurora, Colorado movie theater shooting.

Currently pending in a Connecticut appeals court is a case of nationwide interest, in which the family members of first graders killed in the mass shooting at Sandy Hook Elementary School filed an action seeking an end run around the PLCAA. These families seek damages and injunctive relief against several gun manufacturers and distributors, including Bushmaster Firearms International and Remington Arms Co., LLC through a 33 count amended complaint, most of which sounds in wrongful death. The plaintiffs attempted to fall within the PLCAA’s negligent entrustment exception by arguing, inter alia, that the defendants knew or had reason to know that their respective entrustees were selling military caliber AR–15s to the civilian population, which posed an unreasonable and egregious risk of physical injury.

The plaintiffs also tried to fall within the predicate exception by alleging that the defendants’ sales and marketing practices violated the Connecticut Unfair Trade Practices Act (“CUTPA”).

Unsurprisingly, the defendants moved to strike the amended complaint and prevailed on the grounds of immunity under the PLCAA because the plaintiffs’ causes of action did not fall under any PLCAA exception. Specifically, the court held that the plaintiffs failed to state legally sufficient claims for a violation of the CUTPA, and failed to state legally sufficient claims for negligent entrustment under either Connecticut law or the PLCAA.

Two of the court’s holdings—that the plaintiffs failed to state a claim for a violation of the CUTPA and for negligent entrustment under Connecticut law—dealt with state-law issues. The court’s other holding directly addressed the scope of the PLCAA’s negligent entrustment
exception, where the court held that the plaintiffs’ claims failed because none of the individuals or entities “entrusted” with the weapon by the defendants (i.e., the store that sold the gun, the shooter’s mother who purchased the gun) “used” it within the PLCAA’s definition of “negligent entrustment.” Rather, the only actionable “use” of the weapon was by the shooter, who was not entrusted with the weapon by the defendants. The plaintiffs have appealed this holding, arguing the lower court improperly interpreted the term “use,” which is not defined in the PLCAA, to refer exclusively to discharging a weapon to cause harm.

The case is now pending on appeal to the Connecticut Supreme Court, which will review the state-law holdings and the lower court’s analysis of the PLCAA’s negligent entrustment exception. The defendants raised several arguments in response, including that the plaintiffs did not have standing to bring a CUTPA claim because they are not consumers, competitors, or other business persons with a commercial relationship to the
defendants. The motion court, while acknowledging that the language of the CUTPA does not have a “relationship requirement,” held that, based on binding appellate precedent, the plaintiffs did “not set forth legally sufficient claims” because they did not allege a business relationship with the defendants. The plaintiffs have appealed this holding, arguing the lower court misread one of the decisions it relied on and that the other was wrongly decided. The plaintiffs argue for a plain text reading of CUTP , which does not include a relationship requirement.

Vaccine Manufacturers
The makers of childhood vaccines also received a limited form of immunity from civil suits from Congress. In the 1980s, vaccine manufacturers feared a scourge of lawsuits in response to a study suggesting that certain vaccines caused brain injuries in children. In response, the manufacturers ceased making certain vaccines, creating a threat to the public health. So Congress passed The National Childhood Vaccine Injury Act (“the Act”) in 1986 and codified at 42 U.S.C. § 300aa et. seq., which preempts various lawsuits against vaccine manufacturers and, at the same time, sets forth a remedial program to compensate those who suffer side effects from vaccines. Congress’ goal in passing the Act was to “end instability and unpredictability” in the childhood vaccine market, which was described in the Act’s legislative history as “one of the most spectacularly effective public health initiatives this country has ever undertaken.” Bruesewitz v. Wyeth LLC, 562 U.S. 223, 245–46 (2011) (concurring opinion) (internal citations omitted).

Under the Act, vaccine manufacturers are shielded from all civil actions for damages arising from vaccine-related injuries or deaths associated with administration of a vaccine after October 1, 1988, “if the injury or death resulted from side effects that were unavoidable even though the vaccine was properly prepared and was accompanied by proper directions and warnings.” 42 U.S.C.A. § 300aa-22 (West).

This broad grant of immunity encompasses failure to warn claims (so long as the manufacturer complied with regulatory requirements) and all design defect claims. Vaccine manufacturers are also generally immunized from punitive damages, and claimants must first seek relief through the remedial program before bringing a claim for more than $1,000 in damages against a vaccine manufacturer.

The tradeoff for this immunity is a remedial program, which allows a person injured by a vaccine to file a petition for compensation with the Court of Federal Claims. To obtain compensation, a claimant need not prove causation, a design defect, or a manufacturing defect. Rather, a claimant must show that they received a vaccine listed in the Vaccine Injury Table, 42 U.S.C. § 300aa-14, and developed a covered injury within a specified time-period. The Secretary of Health and Human Services can rebut a prima facie case by proving that the injury was caused by factors unrelated to the vaccine’s administration.

The remedial program also includes mechanisms for compensating individuals who suffer side effects not listed in the Vaccine Injury Table or who manifest symptoms outside of the specified time range. To date, nearly $2 billion has been paid to successful claimants under the program, which is funded through a tax on vaccines.

Tobacco Companies
Tobacco companies have also received various degrees of immunity from civil suits. For example, from 1988 to 1998, the California legislature granted tobacco companies complete immunity from actions for injury or death caused by a tobacco product, except for actions based on a manufacturing defect or breach of an express warranty. See Cal. Civ. Code § 1714.45 (added by Stats.1987, ch. 1498, § 3, p. 5778); Myers v. Philip Morris Companies, Inc., 28 Cal. 4th 828, 831–32 (2002) (“The first version [of section 1714.45 of California’s Civil Code], which we here sometimes refer to as the Immunity Statute, granted tobacco companies complete immunity in certain product liability lawsuits as of January 1, 1988.”).

Additionally, as part of the “Master Settlement Agreement” between tobacco companies and the Attorney General of 46 states, tobacco companies received immunity from future legal claims that states may have for, among other things, the use, sale, distribution, and manufacture of tobacco products. This settlement applies broadly to claims brought by states, but does not extend to suits brought by state residents. In exchange for this grant of immunity, tobacco companies agreed to curb various advertising tactics and pay a minimum of $206 billion over
the first 25 years of the agreement to settle lawsuits brought by states to recover tobacco-related health care costs and to pay for future health-care costs.

Manufacturers and Distributors of Opioids and Other Pharmaceuticals
Today, the companies that manufacture and distribute prescription opioid medications face an onslaught of civil litigation seeking to hold them responsible for the full range of social issues and costs that have arisen from the illegal use of their products and use of illicit opioids like heroin. In addition to the FDA, which has been addressing issues relating to the appropriate use of, labeling for, and communications about prescription opioid medications in many different ways, and the DEA, which regulates the distribution of these products, Congress recently acted, not to provide immunity to the makers of these products, but rather to appropriate $6 billion in funds for drug treatment over a two-year period. See Bipartisan Budget Act of 2018, Pub. L. No. 115-123. That amount has been criticized as insufficient, and numerous states and municipalities have sought to recoup public funds they claim they have expended in dealing with opioid abuse.

The City of Chicago and two California counties were the first to file lawsuits seeking to hold pharmaceutical manufacturers liable for costs
associated with the public health crisis arising from misuse of opioids. City of Chicago v. Purdue Pharma L.P., No. 2014-L-005854 (Ill. Cir. Ct. June 3, 2014); The People of the State of California, acting by and through Santa Clara County Counsel Orry P. Korb and Orange County District Attorney Tony Rackauckas v. Purdue Pharma L.P. et al., No. 8:14-cv-01080 (Cal. Super. Ct. May 21, 2014). These suits allege that “aggressive marketing” of their products by several manufacturers has caused a drug epidemic that has cost taxpayers millions of dollars. Hundreds of similar suits have followed over the last two years.

Several factors should aid the manufacturers in defense of these suits. Their products are lawful and necessary drugs, approved and regulated by the federal government. The labeling for these medications provides physicians and patients prominent warnings about the risks of addiction, overdose, and even death. The manufacturers do not distribute the drugs directly to the public; instead, there are several intermediaries in the distribution process, including the doctors who make individual prescribing decisions. There are also criminal actors who break the chain of causation between manufacturers and ultimate users by improperly diverting and selling these medications in the black market. People who die of overdoses from prescription opioid medications most often were not using these medications as they were prescribed.

Unlike tobacco products, opioid medications are as necessary as vaccines, so a solution must be found. Other than setting aside funds for drug treatment, Congress has not yet entered the fray. Recently, a federal court judge overseeing hundreds of opioid lawsuits that have been centralized in the Northern District of Ohio signaled that he is overseeing confidential settlement discussions. See In Re: National Prescription Opiate Litigation, Case:1:17-md-02804-DAP (Dkt. 170). But clearly, given the number of such suits filed in jurisdictions across the county, those discussions are only the beginning in the process of finding an acceptable resolution to these issues that will hopefully strike the right balance between the public interest and those who may or may not bear responsibility for the crisis.