Liability Protections Under Consideration for Businesses Set to Reopen During the COVID-19 Pandemic

With the Senate set to return from recess on Monday, liability protections related to the COVID-19 pandemic are anticipated to be a hot button issue. While state and local governments are seeking financial aid from the federal government to assist in their battle against the COVID-19 pandemic, relief packages may also include protection from future legal actions against businesses.

As stay-at-home restrictions are beginning to be lifted, and businesses are starting to reopen, there are concerns that employees and customers will file suit against businesses, claiming that they were infected with COVID-19 as a result of the businesses’ failure to take appropriate measures to protect them once reopening occurs. This fear is likely in response to lawsuits that have already arisen against businesses related to COVID-19. For instance, earlier this month, a Celebrity Cruises crewmember, who contracted COVID-19 while working on a Celebrity ship, filed a proposed class action alleging that the cruise company failed to take adequate measures to protect the employees on its ships.[1] The crewmember filed the proposed class action in a Florida federal court, claiming that the cruise company failed to follow safety precautions after receiving notice that COVID-19 was or was likely present on the ships, such as permitting crewmembers to continue to eat in a buffet setting, and mandating crewmembers’ participation in shipboard drills.[2] Continue reading Liability Protections Under Consideration for Businesses Set to Reopen During the COVID-19 Pandemic

HHS Offers Details on Liability Immunity of PREP Act Following Passage of CARES Act

The Department of Health & Human Services (HHS) has provided an omnibus advisory opinion in response to various requests for clarification of the scope of tort immunity provided by the declaration under the Public Readiness and Emergency Preparedness Act (PREP Act). The PREP Act declaration provides immunity from tort liability for various persons, products and activities in response to COVID-19, as explained in our March 17, 2020, Alert. The Coronavirus Aid, Relief and Economic Security Act (CARES Act) subsequently expanded these protections.

To read the full text of this Duane Morris Alert, please visit the firm website.

Artificial Intelligence and Machine Learning-Based Medical Devices: A Products Liability Perspective

Artificial intelligence (AI), once little-known outside of academic circles and science fiction films, has become a household phrase. That trend will continue to expand as the public becomes more exposed to AI technology in everyday products, ranging from their cars and home appliances to wearable devices capable of tracking the metrics of their everyday routines. Perhaps no facet of AI has sparked observers’ imaginations more than machine learning (ML), which is precisely as it sounds: the ability of computer programs to “automatically improve with experience.” Machine learning lies at the heart of the kind of independent and superhuman computer power most people dream of when they consider AI.

While the public’s imagination is free to run wild with the promises of ML—creating an appetite that will no doubt be met with an equal and opposite response from businesses around the world—traditional policy and law-making bodies will be left with the task of trying to adapt existing legal and regulatory frameworks to it. Therefore it bears consideration how existing products liability norms might apply to AI/ML-based products, if at all, and what sort of uncertainties may arise for product manufacturers, distributors, and sellers. No enterprise better illustrates the careful balance between the endless potential of AI against the unique risks of products liability concerns than the medical device industry. This article discusses the uses and unique benefits of AI in the medical device context, while also exploring the developing products liability risks.

To read the full article by Duane Morris partner Matthew Decker, visit the MD+DI website.

Depositions During the COVID-19 Crisis

With 95% of the country presently subject to stay-at home orders due to COVID-19, many litigators are considering whether and how to take depositions in the coming weeks. Federal court responses have varied, from blanket extensions of civil deadlines to encouraging remote depositions. Whether it is advisable or even permissible to depose a witness under current circumstances will depend on several factors, including the jurisdiction, the deponent, and the anticipated substance of the deposition.

Many Courts are Extending Discovery Deadlines:

Numerous courts have issued administrative orders extending all civil deadlines due to COVID-19. The District of New Jersey, for example, in Standing Order 2020-04, extended all filing and discovery deadlines which fall between March 25, 2020 and April 30, 2020 by forty-five days. See also, Standing Order 3:20-mc-105 (D.S.C. Mar. 16, 2020) (extending all civil deadlines); Standing Order 20-0012 (N.D. Ill. Mar. 30, 2020) (same).

Continue reading Depositions During the COVID-19 Crisis

Order Requires Disclosure of 3rd Party Funding Information in Zantac MDL

On April 3, 2020, the United States District Court for the Southern District of Florida issued an order in the pending Zantac multidistrict litigation (”MDL”) requiring disclosure of funding arrangements and funding documentation between plaintiffs’ counsel and third-party litigation financiers. This order represents some increased traction in favor of arguments seeking to require disclosure of third-party funding arrangements in MDLs.

The Zantac MDL, In re Zantac (Ranitidine) Prods. Liab. Litig., MDL No. 2924, was originally formed by the Judicial Panel for Multidistrict Litigation on February 6, 2020. The plaintiffs sued various defendants, including manufacturer Sanofi and its distributors, alleging that the active ingredient in the heartburn medication Zantac breaks down to form a carcinogen that caused personal injuries. Included in the MDL are also six putative classes of consumers who sought refunds and economic damages based on their purchase of Zantac. Due to a number of actions already pending in the Southern District of Florida, the Panel transferred the remaining actions to that court to be assigned to the Honorable Robin L. Rosenberg.

Continue reading Order Requires Disclosure of 3rd Party Funding Information in Zantac MDL

Personal Protective Devices Available Through 3D Printing Process

During the COVID-19 pandemic, the demand for personal protective equipment (PPE) has significantly outpaced the capabilities of the traditional supply chain. Gowns, gloves, facemasks, and face shields are valued commodities that even many healthcare providers cannot secure in this environment. While traditional supply and manufacturing chains struggle to keep up with production, industry leaders have turned to 3D printing, or additive manufacturing technology, to address this dire need. Unlike traditional manufacturing methods, companies with already established additive manufacturing technologies can more readily and efficiently adapt their productions to manufacture such PPE. 3D printing manufacturers may already have the powder or fabric necessary to manufacture PPE. They also have versatile printers. These companies simply need software and product design specifications, which allows them to begin production much more quickly than companies relying on traditional manufacturing methods that require additional raw materials and even machines and equipment.

For example, Superfeet, a shoe insert manufacturer, which typically uses 3D printing for manufacturing its products, was contacted about its ability to assist with a shortage of powered air purifying respirators (PAPR) hoods to hospitals in Washington state. The company had printers and fabric already. In just a few short days, Superfeet was making PPE.

To read the full text of the article by Duane Morris , visit the MD+DI website.

Florida Nursing Homes Ask Governor for Liability Immunity Protection From COVID-19 Lawsuits

In an April 3, 2020 letter, Florida’s largest advocacy group for long-term care providers, Florida Health Care Association, asked Florida Governor Ron DeSantis to extend sovereign immunity to heath care providers and health care facilities engaged in and responding to the COVID-19 outbreak.  The letter requests liability immunity (both criminal and civil) for any harm or damages alleged to have been sustained as a result of an act or omission in the course of arranging for or providing health care services in accordance with COVID-19’s emergency rule and state directives.  Additionally, the letter requests immunity for the health care facility or health care professional if they are arranging for, or providing health care services, in good faith.

“Health care facilities” has been defined to include skilled nursing facilities, nursing homes, hospitals, or other facilities licensed or authorized to provide health care services under Florida code.  Additionally, this term is to include “any site providing health care services established for the purposes of responding to the COVID-19 outbreak pursuant to any existing or future federal or state orders, declarations or waivers.” Continue reading Florida Nursing Homes Ask Governor for Liability Immunity Protection From COVID-19 Lawsuits

Fifth Circuit Affirms Snap Removal Practice – Joins Second and Third Circuits in Recognizing the Viability of Pre-Service Removal

On Tuesday, the Fifth Circuit Court of Appeals, joining the Second and Third Circuits, adopted the plain-meaning approach to the removal statute holding that the forum-defendant rule does not prohibit a defendant from removing a case from state court to federal court on the basis of diversity jurisdiction before the plaintiff formally serves the forum state defendant.  The U.S. Courts of Appeals that have addressed this issue are now three for three on recognizing the viability of pre-service “snap” removal.

Under 28 U.S.C. § 1441(a), a defendant is permitted to remove a case from state court to federal court where the federal court has diversity jurisdiction.  Removal pursuant to diversity jurisdiction is permitted when the amount in controversy is over $75,000 and the parties are “diverse” in citizenship, where no plaintiff is a citizen of the same state as any defendant.  However, there is a limit to a defendant’s ability to remove a case and a civil action may not be removed on the basis of diversity jurisdiction “if any of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought.[1]”  This provision is commonly known as the “forum-defendant” rule and has led to a divide among district court judges as to whether they should apply a plain-meaning approach or a more policy-based approach to interpret the statute.  The plain-meaning approach allows removal any time before the forum-defendant has been “properly joined and served” (snap removal).  The policy-based approach does not allow for removal in these circumstances as a way to discourage gamesmanship and a race to remove prior to service because it would run contrary to the policy of allowing a plaintiff to litigate in its chosen forum and keeping certain groups of cases in state courts.  In 2018 U.S. Court of Appeals for the Third Circuit became the first circuit court of appeals to recognize and endorse the viability of pre-service (snap) removal[2].  In 2019, the Second Circuit became the second circuit court of appeals to weigh-in on this issue and also affirmed the pre-service (snap) removal practice[3].  Yesterday, the Fifth Circuit became the third circuit court of appeals to weigh-in on the issue. Continue reading Fifth Circuit Affirms Snap Removal Practice – Joins Second and Third Circuits in Recognizing the Viability of Pre-Service Removal

Anti-Malaria Drugs Approved by FDA for COVID-19 Treatment Fall Within Liability Shield of the PREP Act

The Food and Drug Administration (“FDA”) gave emergency approval this week to two (2) anti-malaria drugs, hydroxychloroquine and chloroquine, to be used for treatment of COVID-19 patients.  Despite the limited studies as to the benefits of these drugs and the well-known risks of these drugs, the FDA took the position that, under the current circumstances, the potential benefits and effectiveness outweigh the risks.  While the FDA is conducting a trial as to the effectiveness of these drugs, millions of doses have already been shipped to hospitals nationwide for administration in an attempt to slow the spread of COVID-19.

Under normal circumstances, this large number of side effects may require additional studies, but given the unprecedented outbreak facing the nation and the world as a whole, the FDA has decided that the benefits outweigh the risks regarding these drugs and has approved their immediate use with COVID-19 patients.  While all hospitals that prescribe either drug are required to report negative side effects to the FDA, both drugs are protected “countermeasures” under the Notice of Declaration (“Declaration”) under the Public Readiness and Emergency Preparedness Act (“PREP Act”) for medical countermeasures against COVID-19 that was declared effective on February 4, 2020[1].  The PREP Act declaration provides immunity from liability (except for willful misconduct) for claims of loss caused, arising out of, relating to, or resulting from the administration or use of these drugs/countermeasures.  Per the Declaration, this liability immunity applies to entities and individuals involved in the development, manufacture, testing, distribution, administration, and use of medical countermeasures[2].  This immunity would extend to failure to warn claims—meaning even if some of the side effects are not adequately communicated to the medical providers—the manufacturer and distributor may have a shield from liability. Continue reading Anti-Malaria Drugs Approved by FDA for COVID-19 Treatment Fall Within Liability Shield of the PREP Act

Maryland Statutory Damages Cap on Pain and Suffering Upheld – Surviving a Challenge to its Constitutionality

A Maryland Court of Special Appeals, the intermediate appellate court for Maryland, recently rejected a constitutional challenge to the state’s statutory cap on non-economic damages in tort claims involving personal injury.  In a unanimous decision, the Court of Special Appeals affirmed the trial court’s reduction of a $2.5 million pain-and-suffering damages award to $830,000 in an automobile collision case.

In Crouell v. Turner, the plaintiff was injured in a motor vehicle accident in May 2017 when a commercial truck crossed over a median and struck her car[1].  After a jury trial, the jury found in favor of the plaintiff and awarded her $314,470.45 for medical expenses, $2,500,000 for non-economic damages and $3,000,000 for punitive damages.  After the verdict, the trial court, applied the cap on non-economic damages and reduced the award from $2,500,000 to $830,000.  The statutory cap was first enacted in 1986 and imposed a limit of $350,000 on non-economic damages related to personal injury or wrongful death.  Non-economic damages in a personal injury action include damages for “pain, suffering, inconvenience, physical impairment, disfigurement, loss of consortium, or other non-pecuniary injury.”[2]  The statutory cap was modified in 1994 to increase the cap to $500,000 and the cap increases by an additional $15,000 for each year after 1994 in which a cause of action arises. Continue reading Maryland Statutory Damages Cap on Pain and Suffering Upheld – Surviving a Challenge to its Constitutionality