Alabama Litigation Review : North Alabama Personal Injury Lawyer & Attorney : Jeff Blackwell : Hornsby, Watson, Hornsby, Blackwell & McKown Law Firm : Commercial Litigation, Workers' Compensation : Huntsville, Decatur, Athens

The Federal Judicial Panel on Multidistrict Litigation has issued its Order consolidating all pending Actos cases in Federal Court. The cases have been consolidated before U.S. District Judge Rebecca Doherty in the U.S. District Court for the Western District of Louisiana. This means that Judge Doherty will preside over all the pretrial proceedings in these cases. Bloomberg has a good article concerning this decision and its impact on Actos litigation against Takeda Pharmaceutical.

I have written previously on the issues surrounding Actos:

1. Takeda May Face Thousands of Lawsuits over Actos - overview of the potential claims facing Takeda due to its diabetes drug.
2. Type 2 Diabetes, Actos, and Bladder Cancer - the use of Actos to treat diabetes.

This litigation is only in its early stages. I expect that the court will face a huge number of claims to manage.

The purpose of the multidistrict litigation (MDL) process is to consolidate cases before one court that can handle the various discovery and pretrial proceedings. The idea is that having one court handle the various pretrial issues will conserve resources, save costs, and prevent numerous courts issuing rulings that may be inconsistent. Cases are returned back to the Federal Court where they were originally filed for the trial.

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I wrote a few days ago about the health issues being associated with the diabetes drug Actos.  Now, the headline yesterday from Bloomberg says it all:

TAKEDA MAY FACE 10,000 U.S. SUITS OVER ACTOS CANCER CLAIMS

Regulators in France and Germany have already pulled the drug from their markets.  In the U.S., the typically slow to act FDA has begun to take steps as a result of the research.

The main issue surrounding Actos involves research into its relationship to bladder cancer.  Unlike many other cancers, there are fewer potential causes of this cancer.  Thus, it will likely be more difficult for Takeda to blame cases of bladder cancer on causes outside the long-term consumption of its drug, Actos.  I believe there will be claims alleging that Actos caused other problems such as strokes and heart attacks as well.  Other prior drugs in the same class as Actos have had similar issues.

A number of suits are already pending around the country over Actos and bladder cancer.  The United States Judicial Panel on Multidistrict Litigation is currently considering where to consolidate the numerous existing and expected cases for pretrial procedures.  Yesterday, the panel held a hearing on the current Actos litigation.

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Many adults are impacted by Type 2 diabetes (sometimes referred to as adult-onset diabetes or non insulin-dependent diabetes).  Type 2 diabetes is a chronic condition that affects the way your body metabolizes sugar.  Left untreated it can be life-threatening.  However, the condition can be managed.  Often, it can be managed through diet and exercise.  Unfortunately, sometimes medications are necessary.

The Mayo Clinic website has an excellent chart that lists various medications used to treat Type 2 diabetes.  These medications fall into several different categories of drugs.  Each category works to manage the condition through a different process.

Actos is in the category known as glitazones, that were designed to increase the cell's sensitivity to insulin.  What other medications were in this same category?  One medication in this category was Rezulin which was withdrawn from the market in 2000 due to issues with liver toxicity.  Another was Avandia which has been severely restricted as a result of heart issues.  I have written on prior occasions about the problems with Avandia.  Since my last post on Avandia, there have been new developments concerning the potential harm of that drug.

After these other two drugs were removed or severely restricted in use, the number of Actos prescriptions grew substantially.  How much money did Actos generate for Takeda, the Japanese company producing the drug?  A 2011 article on pharmaceutical sales revealed that Actos recorded $3.58 billion in sales over just the first 9 months of 2010. 

Now, we learn that Actos may also present considerable health risks. In September 2010, the FDA issued a safety announcement about the potential risk of bladder cancer after extended consumption of Actos.  At that time, the FDA said it was reviewing data to determine the association between Actos and bladder cancer.  According to the FDA safety announcement

An increased risk of bladder cancer was observed among patients with the longest exposure to Actos, as well as those exposed to the highest cumulative dose of Actos.

In June 2011, both French and German regulators suspended the sale of Actos in their countries citing studies linking the drug to an increased risk of bladder cancer.  Also, in June 2011, the FDA issued a new safety announcement about Actos.  In this announcement the FDA specifically warned consumers that

use of the diabetes medication Actos for more than one year may be associated with an increased risk of bladder cancer.

Since Takeda introduced Actos, millions of prescriptions have been issued.  The physicians prescribing the medication were not aware of these risks until the FDA recently issued its safety announcements.  This does not appear to be true for the manufacturer Takeda.  In fact, evidence suggests that Takeda knew of the increased risks of bladder cancer posed by Actos as early as the pre-clinical studies, which showed an increase in drug-induced tumors in the bladders of rats.  Yet, Takeda sold Actos without any warning of this increased risk until the FDA's recent actions requiring additional warnings.  And yet, bladder cancer may not be the only problem associated with Actos.  The latest studies indicate that bladder cancer is only one of Actos' potentially life-threatening side effects.

It is very difficult to hear the story of a patient who now suffers cancer after taking Actos for an extended period of time.  Then, on top of that, you consider the evidence that the company may have known of problems and yet sold billions of dollars of pills without a warning.  I think much more information will be revealed in the coming months about the impact of this drug on patients.

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Yesterday, I read a blog post by Mobile, Alabama attorney Edwin Lamberth.  Edwin's blog is always a great source of commentary.  Edwin's recent post discusses an important issue - foreign companies not being held accountable for the injuries and deaths caused by their defective and dangerous products.

This is a subject I've previously addressed as well.  In my prior posts, I discussed the need for Congress to pass legislation protecting the public from needless injuries by holding these manufacturers accountable.  Last year, such legislation was introduced before Congress.  That proposed legislation would not only protect consumers but would also level the playing field for manufacturers in the U.S. who are going the extra mile to try and produce safe products.

Now, the U.S. Supreme Court has weighed into the issue - but with two bad decisions that deny justice to the victims of defective and dangerous products produced by foreign companies for distribution in the United States.  Edwin's post presents a great analysis and commentary on these new decisions.  Since his post captures my thoughts on the issue as well, I would just urge others to read it.  I am very troubled by these recent Court decisions further closing the doors of justice to families dealing with a severe personal injury or the death of a loved one due to a dangerous and defective product.  I certainly hope this is not the end of this issue.  Perhaps now Congress will finally act in the interests of the public and business by passing legislation to hold those accountable who ship defective products to us.

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Last week, news sources reported that Alabama's new Attorney General Luther Strange fired the outside law firms representing Alabama in the BP oil spill litigation.  Now, Attorney General Strange says he will personally assume the role of lead counsel for Alabama.  This is an interesting development.  The big question is -- Did our Attorney General make a good decision or a bad mistake by firing competent outside counsel and assuming the lead role himself?  In all honesty, I see the merits of each side in this debate.

Alabama has a significant history of hiring private law firms to represent our State in litigation seeking to recover damages.  Our last Attorney General Troy King used private firms on several occasions to represent Alabama in complex civil claims.  Some of these claims included:

1. Litigation against certain drug manufacturers as a result of excess charges against Alabama's Medicaid Agency;
2. Litigation against ExxonMobil related to royalty payments owed Alabama;

These claims resulted in the recovery of millions of dollars for the State of Alabama.  So, we have a history of some success with outside private counsel before the BP litigation ever started.  This brings us to the present issues involving Alabama and the results of BP's oil spill.  Without question, Alabama suffered one of the greatest impacts from BP's conduct.  Many of our citizens suffered huge damages, including damages to their property and businesses.  This has resulted in a significant number of personal lawsuits against BP.  Likewise, the State of Alabama has sustained huge losses from the BP oil spill.  According to some estimates, our State lost $148 Million in tax revenue as a result of the catastrophe.  Before he left office, our last Attorney General again engaged private legal counsel to protect Alabama's public interests in the resulting litigation.

Thus, Attorney General Strange's decision last week alters a course already set in motion by his predecessor.  How did he justify changing course?  When he assumed the lead role for Alabama in the BP litigation, Attorney General Strange argued that his decision would save the taxpayers outside legal fees.  

While I commend any effort to save the taxpayers money, the issue is not quite so simple.  First, the fees are contingent.  That is, the State incurs no fees if the claims are not successful.  Second, complex claims like those involved in the BP litigation require significant skill and experience.  Any attorney can claim that he has the skill to handle complex civil litigation.  However, the reality is far different.  Experience and skill make a significant difference in reaching a successful result.  I see this reality on a daily basis talking to individuals who called an attorney that simply advertised for injury cases or civil litigation without the real expertise to handle the claim.  Typically, the results more than justify the contingent fee paid to skilled litigation counsel.

I don't write this simply to criticize Mr. Strange and argue his decision to fire Alabama's private counsel in this case was short-sighted.  I hope that he has the personal experience (or litigators in his office with the skill and experience) to handle this important litigation.

I also agree with Mr. Strange on one point.  Our last Attorney General was strongly criticized for his conduct in hiring private outside counsel.  This criticism was fueled by the fact that the same outside law firm appeared to get most of this lucrative business.  Maybe the attorney selection process was fair and equitable.  Even if so, the appearance was otherwise.

Our Attorney General has a real opportunity here.  Now that he has assumed the lead for Alabama in the BP litigation, he has a real opportunity to seek full justice for Alabama against BP.  He has the opportunity to make his office a true legal advocate for our citizens.  He also has the opportunity to establish some clear and fair rules for the future use of outside counsel that can assist our State.  Clearly, in a world of complex and varied legal issues, the need for competent outside counsel will always exist.  So, Mr. Strange can take this opportunity to establish fair and equitable rules for the future.  Will Mr. Strange use these opportunities for the public good?  I hope so.

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I recently spoke at a seminar where we had a great discussion about ongoing medical device and pharmaceutical litigation.  No, the companies that we discussed did not pay me to mention their products.  No, none of these large corporations agreed to host the seminar at a sunny beach location or at a ski resort.  Then, again, their executives probably would not have paid for the kind of honest discussion we had about the damage caused by some of their products.

However, these same companies have provided millions upon millions of dollars to various physicians and medical groups.  This includes money directly to physicians.  It also includes trips to the fun places I mentioned earlier.  This infusion of cash to the various physicians who are supposed to be unbiased in their assessment and research raises serious questions.  I have written about these issues previously.

According to the Birmingham Business Journal, we now learn that drug companies paid Alabama doctors $4.6 Million in 2009-2010.  A recently released document shows that one local physician, an internist in Decatur, even received over $200,000.00 in payments from GlaxoSmithKline, alone.  If you are taking notes, that is the same company that made billions marketing Avandia before the public became aware of its dangers.  The same company that apparently hid negative test results concerning Avandia.  The same company that may have paid one member of the FDA advisory panel.  I don't mean to single out Glaxo.  The same Decatur physician also received significant money during this short period of time from another pharmaceutical giant as well.

In fairness, I do not know the relationship between the local physician I mentioned and his patients.  I do believe, however, the process of approving and marketing drugs and medical devices to patients is tainted by the flow of money to physicians and those involved with the regulatory process.  If we ever want the process to focus on what should be the most important goals, patient health and safety, then we must insist on a regulatory process that requires full disclosure by both the companies and the decision makers.  We must also insist that patients have full disclosure of the relationships between their medical providers and the companies whose products the are providing.  I would certainly want to know if my doctor had received a significant amount of money from the drug company whose product he was now prescribing to me.

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Yesterday, the United States Department of Justice announced that it had recovered $3 Billion in fiscal year 2010 against those companies and individuals who had defrauded our government.  These recoveries involved claims for all types of fraud against our government, including military contracts, non-military contracts, federally-insured mortgages, and mineral leases, among others.  It is a welcome relief to see our government act to pursue those who steal from all of us.  In addition to the record amount recovered, it is also interesting to note that the largest single area of fraud against our government involves the health care industry.  According to the government's announcement and an NPR article involving this issue, $2.5 Billion of the $3 Billion recovered, involves the actions of big pharmaceutical companies.

I have written previously about the long FDA saga with Avandia as well as the manufacturer's apparent concealment of adverse studies involving the health risks of that drug.  I have also written about the deceptive marketing practices involving the use of shoulder pain pumps. 

We are now in the middle of discovering the extent of damage caused by DePuy's defective hip replacements.  DePuy, a Johnson & Johnson subsidiary, sold over 90,000 of these implants, including a large number here in North Alabama.  As the full extent of damage from DePuy's defective implant comes to light, it is important to remember that DePuy has previously been the subject of probes involving the practice of paying kickbacks to physicians in an effort to implant its products into patients.

According to the government's report, this year's false claims actions involved companies such as Pfizer over its promotion of the painkiller Bextra, Astra Zeneca over the anti-psychotic drug Seroquel, and Novartis.  I applaud the efforts of the Department of Justice to pursue issues of fraud against our government, including fraud and abuse concerning drugs and medical devices.  However, the government needs to act during the approval and review process so that the interest of the public is protected, from the beginning.  While recovering taxpayer funds is great, it is too late at that point for the people actually harmed by dangerous and defective products.

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Last month I discussed the recent recall of the ASR hip replacement products manufactured by Depuy Orthopedics.  With over 90,000 of these medical implants sold, this is a tremendous issue that will affect many people.  These defective implants can result in significant injuries and damages to the individuals using them. 

How will Depuy treat the patients who underwent these transplants and now face some difficult decisions?  Depuy's past conduct should provide much cause for concern.  In May, a former Depuy executive pled guilty to providing some $7 Million in bribes to doctors in Greece in an effort to persuade them to use the company's products.  In 2007, Depuy paid $84.7 Million to settle civil and criminal probes by the U.S. Department of Justice involving allegations of kickbacks to surgeons in an effort to get them to use the company's orthopedic devices.  Medical device manufacturers, like Depuy, can exercise significant financial influence without simply paying physicians directly.  The industry routinely provides fellowships, sponsors seminar trips, and utilizes means of indirect financial incentives to hospitals and surgeons.

Most physicians care deeply about their patients.  If you receive a recall letter and have a supportive physician, your physician should discuss the issues with you and conduct any needed tests.  Some supportive physicians are actually encouraging their patients to seek legal representation.  If you don't have a supportive physician, seek one immediately.

Should you sign the documents Depuy may have provided your physician?  Definitely not.  It appears there may be different versions of these documents.  However, they will allow Depuy to gather all your medical records and, perhaps, the hip device itself.  This would serve simply to help Depuy prepare its defense at your expense.

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It's been a long time since I last posted.  Between then and now, I had several significant cases set for trial that required almost all my time.  One of these cases ended in a week-long trial before getting a good result for my client who suffered catastrophic injuries.  After any long trial, one of the greatest challenges is simply catching up on the things you missed.  So, I hope to return to regular posting here.

In August, DePuy Orthopedics, Inc. (a Johnson & Johnson company), issued a recall notice for its ASR hip replacement products.  These products are the ASR XL Acetabular System and the ASR Hip Resurfacing System.  According to The Wall Street Journal, the company sold approximately 93,000 of these devices before phasing out their production last year.  The ASR Hip Resurfacing System was only available outside the United States.  However, the ASR XL Acetabular System was implanted in patients throughout the United States.

The Food & Drug Administration (FDA) approved the ASR XL Acetabular System for implantation in the U.S. in 2005.  Unfortunately, the FDA apparently approved the device without requiring clinical trials.  Now, we learn that the device has a much higher failure rate than other similar products.  This is a fact that DePuy admits in its recall notice.  The device can generate metallic debris as it wears.  Patients can suffer pain, difficulty walking, fractures, infection, and damage to surrounding tissue.  Because of these problems, additional surgery can be required.

Again, we see the results of a system that rushes products to the market without adequate information or testing.  It is unfortunate that the unsuspecting patients who underwent these implants may suffer problems and require additional surgeries that could have been avoided through earlier clinical trials.  The companies who manufacture these products and our regulatory system, should be focused on bringing the safest products possible to the physicians and patients using them.

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It's been an eventful summer for GlaxoSmithKline (GSK) and its diabetes drug, Avandia.  First, the New York Times dropped its bombshell that secret company testing in 1999 indicated the increased risk of heart attacks associated with Avandia.  Yet, the company may have hidden its own test results, while reaping billions of dollars in revenue continuing to market the drug.

Then, this month, an FDA Advisory Panel met to discuss the future of the drug.  When the panel voted, 29 of the 32 members voted either to remove Avandia from the market or change its warning label in light of the medical issues.  Only 3 members voted to do nothing and 1 member abstained.  Now, we hear that one of the 3 members who defended Avandia and voted to do nothing may have a significant conflict of interest.  In fact, the FDA has even referred this serious issue to the Inspector General of the Department of Health and Human Services for further investigation. 

The investigation into this potential conflict of interest is still ongoing and the facts are not yet clear.  However, it now appears that the panel member under investigation may have received more than $14,000 as a paid speaker for another GSK drug.  It is unclear as to whether the panel member disclosed his advocacy of a different GSK drug to the FDA before serving on the panel.  If he did, then the FDA may not consider that issue to present a conflict since it did not involve Avandia.  While the FDA may not consider such advocacy of a different drug by the same manufacturer to be a conflict if disclosed, it still does not sit well with me.

However, the issue goes beyond the panel member advocating one of GSK's other drugs and whether he properly disclosed his relationship to the pharmaceutical giant.  More troubling, GlaxoSmithKline has now revealed that the same panelist may have actually received money for sitting on an Avandia advisory board.  Did this person have a prior relationship with the company concerning the very drug that he was considering as an FDA panel member?  If true, this undisclosed conflict would certainly present a troubling picture.

The government agencies that protect consumers and the public at large have important roles.  It is essential that the difficult investigations and decisions of these agencies be free from conflict.  In the recent few months we have clearly seen the results of a system where the same people responsible for our safety are tainted by money and relationships to the very companies they are regulating.

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Three days ago, I wrote about the diabetes drug Avandia and the allegations in The New York Times that its manufacturer GlaxoSmithKline (GSK) hid test results indicating the increased risk of heart attacks from using the drug.  At the time of that post, a Food and Drug Administration (FDA) advisory panel was scheduled to meet and discuss Avandia.

Well, the advisory panel has met.  The results of that meeting can be "spun" by both sides of the debate.  What is clear is that a significant majority of the panel voted that Avandia does increase heart risks.  Yet, the panel did not vote to remove the product from the market.  How can the results be interpreted concerning Avandia's future? 

Harlan Krumholz is a physician who is also a Professor of Medicine and Epidemiology at Yale.  Yesterday, he wrote a column in Forbes providing his interpretation of the panel's vote.  In his column, he aptly stated:  "This is a drug with a cloud hanging over it."  Although the panel did not vote to remove the product from the market, a clear majority voted either to remove the product or restrict its marketing.  His article provides some excellent opinion concerning how to interpret the panel's vote.  Interestingly, on the same day as the panel meeting, GSK apparently agreed to settle a large majority of the lawsuits currently pending against it as a result of Avandia, for the sum of $460 million.

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Explosive!  That's the bombshell dropped by The New York Times yesterday.  The article involves the drug Avandia, manufactured by GlaxoSmithKline (introduced to the market by its predecessor SmithKline Beecham).  Avandia entered the market in 1999 as a drug to treat diabetes.  Since then, GlaxoSmithKline has reaped enormous revenue from the sale of this drug.  To put these sales in perspective, it appears that in 2006, the company received $2.2 Billion in revenue from marketing Avandia.

In 2007 (after approximately 8 years of selling this drug), a Food and Drug Administration (FDA) panel issued a black box warning saying that this diabetes treatment was linked to potential increased risks of heart attack.  GlaxoSmithKline continued to market Avandia after this additional warning.

Now, we learn additional information.  Apparently, the company did its own secret internal testing, back in 1999.  What did it reveal?  According to the New York Times, the secret 1999 study results indicated the increased risk of heart attacks associated with Avandia.  Did the company stop marketing Avandia?  No.  Did the company publish the results?  Apparently not.  In fact, the Times article indicates that internal corporate emails specifically stated that the results should be hidden.

Is this the first time that this drug maker has been caught concealing important health and safety information?  Again, the answer is no.  Several years ago, the company was found to have hidden data linking its anti-depressant Paxil to suicidal thoughts in children and teenagers.

The drug maker is not alone in receiving blame in this situation.  In past years, the FDA has failed in its duty to protect us and allowed many unsafe products to be marketed.  Hopefully, the FDA will now "step up to the plate" and do its job.  This week an FDA advisory committee is meeting to discuss the developments concerning Avandia.  Hopefully, the complete nature of this drug will be revealed so that an honest decision can be made concerning its continued use.

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Previously, I wrote about legislation introduced into the U.S. House of Representatives to protect American consumers from dangerous and defective imported products.  The statistics are very troubling.  In 2009, 83% of the recalls announced by The Consumer Product Safety Commission (CPSC) were from foreign manufacturers.  Statistics from recent prior years are similar.

Last week, a Congressional subcommittee held hearings on the proposed bill.  The hearing brief prepared by the subcommittee staff summarizes the current problems with dangerous imported products.  According to the subcommittee brief: 

The import of consumer products into the United States more than doubled in the decade between 1998 and 2007.  This sharp rise in imported consumer products has been accompanied by an overall increase in product recalls and a disproportionate increase in the share of product recalls involving imported products – particularly products from China.

In 2007, the Consumer Product Safety Commission (CPSC) announced 473 recalls.  This was the highest level of recalls in ten years.3 Of those 473 recalls, 389 (82%) involved imported products.  Of the 389 recalls involving imported products, 288 (74%) involved products from China.  Among the defective imported products grabbing national attention in the past several years were: a children’s craft kit containing beads coated with a chemical similar to a date rape drug; toy trains coated with lead paint; a contaminated blood thinning drug; and drywall emitting sulfurous gases.

While the CPSC has been working to bolster its surveillance of imported products and working with foreign governments to improve compliance with U.S. safety standards, holding foreign manufacturers accountable for injuries caused by defective products that make it into the hands of American consumers remains a problem. Victims trying to sue foreign manufacturers for injuries caused by defective products face significant obstacles with respect to providing service of process (notice about the litigation required to be given to the defendant) and establishing jurisdiction over foreign manufacturers in U.S. courts.

According to a CPSC representative at the hearing, by 2008 almost 80% of the toys purchased in the United States were imported from China or Hong Kong.  The fact that the vast majority of toys we place in the hands of our children are imported certainly makes this an important issue

Currently, injured victims trying to sue a foreign manufacturer face substantial hurdles simply providing the required service of process to the foreign defendant.  The Hague Convention on Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters, provides a very time consuming method requiring all legal documents to first be translated into the foreign manufacturer's native language and then provided to a governmental authority for actual attempts at service.  Even if the injured victim eventually has the foreign manufacturer served, the manufacturer will often challenge the suit by claiming the U.S. Court does not have personal jurisdiction over it due to its lack of actual contacts in the United States.  The current rules work to greatly increase the time and expense on the innocent victims of the defective product and the judicial system as a whole.  In addition, they often serve as a means for the manufacturer to escape ultimate liability for the damages caused by its defective product.

The current legislation in the House of Representative solves these initial problems by requiring that foreign manufacturers importing products into the United States designate a registered agent in this country who is authorized to accept service of legal papers.  Registering an agent would also constitute a link establishing personal jurisdiction in the United States where the agent was located.  Similar legislation has also been introduced in the U.S. Senate.

The current legislation does not cure the problem of defective products flooding our market.  We certainly need to take steps that will enforce important safety standards for all products, including those imported to the United States.  Enforcing safety standards protects our citizens from needless injury and damage.  However, this legislation will prevent foreign manufacturers from escaping accountability simply based on service of process and jurisdictional issues.  As a result, it is a much needed step.

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A study by The American Association for Justice shows that eighty-three percent (83%) of the recalls announced by The Consumer Product Safety Commission (CPSC) in 2009 were from foreign manufacturers.  The results for 2008 were similar.  What happens when one of these defective foreign-made products injures someone?

The recent litigation concerning defective Chinese drywall highlights the problems with holding foreign manufacturers accountable for the injuries their products inflict upon the public.  Millions of tons of defective Chinese drywall were imported into the United States for use in the construction of homes.  After these homes were built, owners began complaining that the drywall emitted corrosive and irritating fumes.  In November 2009 the CPSC issued a press statement,  after studying the issue, finding "a strong association between homes with the problem drywall and the levels of hydrogen sulfide in those homes and corrosion of metals in those homes."  The defective drywall was emitting hydrogen sulfide gas which not only created an irritating smell, but also, caused parts of the home to corrode.  The CPSC is continuing to study the health issues which may also be associated with the defective drywall.

Last week, a Federal Judge in Louisiana assessed $2.6 million in damages against a Chinese state-owned manufacturer of this defective drywall on behalf of seven Virginia families.  These damages relate only to the costs necessary to remediate the problem and fix the damaged homes of these plaintiffs, not the potential health risks.  Many other damaged homeowners have also filed claims which remain pending.

The problem arises in the enforcement of the Court's judgment.  Will the foreign manufacturer truly be held accountable or is this a judgment that will never be collected?  The Wall Street Journal published a great article discussing the case and its history.  In this litigation, the Chinese manufacturer never even answered the lawsuit.  While the Court's ruling on the initial drywall claim is a positive step, it remains unclear as to whether the foreign drywall manufacturer that caused this harm will ultimately pay for the damages it created.

Foreign manufacturers are often able to avoid their liability because of difficulties obtaining legal service of the claim on the company in its home country, issues related to whether the U.S. Court has jurisdiction over the manufacturer, and then problems collecting any eventual judgment.  It is important to remember that the damages caused by a defective product will be borne by someone.  If the foreign manufacturer avoids its responsibility, then the innocent consumer, our government, or a domestic company that distributed the product, will ultimately (and unfortunately) bear the loss.

In February, several members of the U.S. House of Representatives introduced legislation that would make it easier to hold foreign manufacturers accountable for their defective products.  The American Association for Justice issued a press release detailing some of the problems under current law as well as solutions presented by the proposed legislation.  Among other things, the proposed legislation would require foreign corporations to have an "agent" in the United States to accept service of process for civil and regulatory claims.  It would also require the manufacturer to consent to jurisdiction in our courts.  This is much needed legislation that will hopefully protect consumers in the future. 

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