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Where No Forum Contacts “Relate To” Claims at Issue, Ninth Circuit Affirms Dismissal for Lack of Specific Personal Jurisdiction

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Specific personal jurisdiction can be a very straightforward concept.  If a plaintiff claims to have been injured by a product that the defendant itself sold directly to plaintiff at a store within the forum state, disputes over specific personal jurisdiction would be rare.  Other cases can be closer calls, particularly when a defendant has extensive contacts within a forum but none of them are causally related to the plaintiff’s claims.  At what point does a defendant’s purposeful availment of a forum cease to be “related to” a plaintiff’s claims?  The Ninth Circuit offered some helpful guidance on that issue in its decision in Yamashita v. LG Chem, Ltd., — F.4th —, 2023 WL 2374776 (9th Cir. Mar. 6, 2023).

Plaintiff in Yamashita was a Hawaii resident who brought a personal injury/products liability suit in Hawaii state court.  The suit named two defendants.  The first was a South Korean company that manufactured a battery that Plaintiff alleged had caused him injury.  The second, which was a wholly owned subsidiary of the South Korean company, was a Delaware corporation with its principal place of business in Georgia.  It did not manufacture the product at issue but distributed it within the United States.  Both defendants denied ever selling the product directly to individual consumers.  The defendants removed the case to the District Court for the District of Hawaii and moved to dismiss for lack of personal jurisdiction.  The district court granted the motion, and Plaintiff appealed.

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Texas Supreme Court Refocuses on Causation and Affirms Summary Judgment in Herbicide Drift Case

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The question of whether a particular application of herbicide on one property caused damage on another’s property requires expert testimony.  When a plaintiff claims that herbicide drift caused reduced crop yields, it is not enough for an expert to opine merely that the drift caused damage to plants – the plaintiff must establish that the defendant’s application of the herbicide caused the reduced crop yield.  The distinction may sound nuanced but can have profound ramifications on litigation.  This is well illustrated in the Texas Supreme Court’s recent decision in Helena Chemical Company v. Cox, — S.W. 3d –, 2023 WL 2335694 (Tex. Mar. 3, 2023), an important and highly followed case focusing on the causation requirement in cases alleging yield loss to a crop from alleged exposure to pesticides.

The plaintiffs in Cox were cotton farmers who alleged that the defendant had supervised an aerial application of herbicide that drifted onto plaintiffs’ properties and damaged their crops, causing reduced yields.  A government inspector conducted a visual inspection of the damaged crops and claimed to find “markers” for the herbicide’s two active ingredients, but no lab testing was performed.  The inspector also identified no “consistent pattern” or “drift pattern” of crop damage over the large area encompassing the various plaintiffs’ noncontiguous properties.  Plaintiffs disclosed a slate of experts to support their allegations, but the trial court excluded the experts and granted summary judgment to the defendant.  The court of appeals reversed, finding the experts admissible despite their inability to trace the alleged drift of the herbicide in question from defendants’ application site to plaintiffs’ properties.

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Class Action Filings on the Rise in Europe, Especially in Product Liability Cases Ahead of Full Implementation of the EU’s Representative Actions Directive

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Under the timeline imposed by the EU’s Directive of the European Parliament and of the Council on Representative Actions for the Protection of the Collective Interests of Consumers, the EU’s 27 member states were required to provide a collective litigation option to consumers by December 25, 2022, including by adopting or amending national law in jurisdictions where mechanisms for such litigation were not previously established. By June 25, 2023, member states are required to implement and begin applying these new mechanisms. But while that process is still ongoing, multiple EU member states have already taken legislative action to permit greater collective litigation mechanisms than previously available in their respective jurisdictions. Additionally, legal industry observers have already noted the increased presence of plaintiffs’ firms and litigation funders in the EU in response to the greater and increasing availability of representative and collective redress actions. See K. Henderson, Z. Okanyi, et al., European Class Action Report 2022, at 2, CMS (2022), available at https://cms.law/en/int/publication/cms-european-class-actions-report-2022.

In particular, one study noted that class action filings in Europe had increased more than 120% over the last five years (from 49 in 2018 to 110 in 2021), propelled by greater attention to potential mass actions by plaintiffs’ firms and increased availability of litigation funding. The data confirms what practitioners in this space already know: the plaintiffs’ bar in the EU is not waiting for the full implementation of the Representative Actions Directive. Of particular note, this rise is fueled, in significant part, by product liability, personal injury, and consumer mass actions.

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The Omnibus Appropriations Act Grants FDA Formal Authority to Require Cybersecurity Action by Medical Device Manufacturers

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Cyberattacks affecting internet-connected medical devices like insulin pumps, intracardiac defibrillators, mobile cardiac telemetry, pacemakers and intrathecal pain pumps have increased in recent years. And such attacks show no sign of slowing, as the number and type of medical device products that are connected to the cloud increase (thereby increasing the attack surface for hackers), and as hackers become more sophisticated. Indeed, in a September 2022 FBI Private Industry Notification, the FBI noted that around 53% of connected medical devices and other internet of things (IoT) devices in hospitals had known critical vulnerabilities. These vulnerabilities could allow hackers to direct medical devices to give inaccurate readings, administer drug overdoses, or otherwise endanger patient health.

In the past, the U.S. Food & Drug Administration (FDA) has urged manufacturers to take measures to ensure the cybersecurity of their products through non-binding guidance. On December 29, 2022, President Biden signed into law the $1.7 trillion Omnibus Appropriations Act, which provided the FDA with authority to require manufacturers to take cybersecurity protection measures as to medical devices that are brought to market through future pre-market submissions. See H.R. 2617 (117th Congress, 2021-2022), text available here.

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Lack of “Newly Acquired Information” Defeats Plaintiffs’ Claims in Zofran MDL

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Zofran (ondansetron) has often been used to combat nausea during pregnancy.  It has never been approved by the FDA for that indication, but clinical experience has not supported an association with pregnancy-related risks – for example, a recent systematic review and meta-analysis concluded that use of ondansetron during pregnancy was associated with a reduced incidence of miscarriage but “was not associated with abnormal pregnancy outcomes,” including a variety of birth defects.  Nevertheless, plaintiffs have alleged that Zofran causes birth defects and that the warnings accompanying the drug should have said so.  Those claims were dismissed in 2021 when the district court held them preempted, and the First Circuit recently affirmed that decision in In re Zofran (Ondansetron) Products Liability Litigation, — F.4th —, 2023 WL 128570 (1st Cir. Jan. 9, 2023).

Plaintiffs in the Zofran MDL alleged, among other things, that the defendants failed to warn of birth defects observed in certain animal studies.  Because such claims implicate the warnings accompanying an FDA-approved drug, they are preempted unless the manufacturer could have unilaterally amended the label through the Changes Being Effected (CBE) regulation.  The CBE regulation permits a manufacturer to amend a product’s labeling without prior FDA approval “to reflect newly acquired information” and thereby “add or strengthen” the warnings where there is “evidence of a causal association” between the drug and the subject on which the warnings are being amended.

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Supreme Court to Resolve Attorney-Client Privilege Split

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For the first time in 25 years, the U.S. Supreme Court is considering the scope of the attorney-client privilege in the case In re Grand Jury, No. 21-1397. The Court heard oral arguments earlier this week about when the attorney-client privilege protects communications involving both legal and nonlegal advice (dual-purpose communications).

In re Grand Jury

A grand jury subpoenaed documents from the petitioner, a tax law firm, related to a criminal investigation into the law firm’s client. In re Grand Jury, 23 F.4th 1088, 1090 (9th Cir. 2021). The law firm withheld documents that had dual-purpose communications based on the attorney-client privilege. After the government moved to compel, the district court used the “primary purpose test” to determine whether the dual-purpose communications were privileged. The court used the test to determine “whether the primary purpose of the communication [was] to give or receive legal advice, as opposed to business or tax advice.” Id. at 1091 (citation omitted). In the end, the district court ordered the law firm to produce documents to the government after redacting tax-related legal advice. When the law firm refused, the court held it in contempt, and the Ninth Circuit affirmed the contempt order.

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