Reassessing strict-liability standards in prescription-drug injury cases

Law prof Mary J. Davis has written Time For a Fresh Look at Strict Liability for Pharmaceuticals. Here's the abstract:

Over the ensuing 50 years from the promulgation of § 402A, products liability in general has seen a retrenchment from strict liability. The Restatement (Third) of Torts: Products Liability openly adopted negligence principles for design and warning claims, and created an entirely new provision to protect pharmaceutical manufacturers even more robust than 402A's comment k. Regarding pharmaceutical liability, the trend away from any liability at all has been remarkable. In the face of this legal history, and in spite of it, this Article proposes taking a fresh look at strict liability for pharmaceutical injuries. What has changed since the adoption of the Products Liability Restatement, which endorsed a virtual immunity from liability for pharmaceuticals? Such a suggestion is likely to be met with cries of “absolute liability” and concern for a chilling effect on innovation for much needed therapeutic treatments. There are three primary reasons this Article proposes a reassessment for strict tort liability in this context. First, the expansive federal preemption doctrine that the United States Supreme Court has fashioned in the last decade defeats almost all state tort liability for pharmaceuticals, particularly for generic pharmaceuticals which comprise over 85 percent of the prescriptions in this country. Second, both the pre-marketing approval process and the post-marketing risk assessment regulatory structures fundamentally cannot adequately identify, communicate, and reduce adverse drug events and, consequently, those events are increasing and likely to continue to do so. Third, the structure of pharmaceutical marketing, increasingly unregulated, has influenced prescribing practices in ways that compound the likelihood and severity of adverse drug events.

These trends in pharmaceutical marketing practices, coupled with the systemic limitations on information-gathering and response in the regulatory system, has created a demand for pharmaceuticals that increases the likelihood of adverse drug events with no meaningful mechanism to identify and reduce the risks presented. While the legal landscape has become barren to the use of tort liability to compensate for the inevitable risk of adverse drug effects, the medical care landscape has become more fertile for those side effects to occur. The convergence of these trends supports a reevaluation of the use of strict, non-fault liability on producers of pharmaceuticals for the harms their products cause.

D.C. Circuit rejects arguments from the federal and D.C. governments that would have weakened fee-shifting statutes

In a 2-1 decision in DL v. District of Columbia, No. 18-7004 (May 21, 2019), authored by Judge David Tatel, the D.C. Circuit has rejected the federal and D.C. governments' efforts to cut the hourly rates payable for a lawyer's legal work under federal fee-shifting statutes. (Senior Judge David Sentelle dissented.) Here is Judge Tatel's explanation of the issue and summary of the court's holding: 

When plaintiffs prevail in a civil rights case, the law usually entitles them to recover reasonable attorney’s fees. Federal district judges, whom Congress has tasked with tabulating those fees, frequently find themselves whipsawed between two seemingly discordant instructions: (1) ascertain the hourly rate for lawyers performing similar work “with a fair degree of accuracy” using “specific evidence,” National Association of Concerned Veterans v. Secretary of Defense, 675 F.2d 1319, 1325 (D.C. Cir. 1982), but (2) do so without turning fee calculations into “a second major litigation,” Hensley v. Eckerhart, 461 U.S. 424, 437 (1983). To reconcile those directives, district courts often turn to a fee matrix—that is, a chart averaging rates for attorneys at different experience levels. For decades, courts in this circuit have relied on some version of what is known as the Laffey matrix. Created in the 1980s, that matrix is based on a relatively small sample of rates charged by sophisticated federal-court practitioners in the District of Columbia. Litigants have updated the matrix for inflation using an assortment of tools. Recently, however, the United States Attorney’s Office sought to replace this standby with a new default matrix based on data for all types of lawyers—not just those who litigate complex federal cases—from the entire metropolitan area—not just the District of Columbia.

In this case, after plaintiffs prevailed in a long-running Individuals with Disabilities Education Act class action, the district court accepted the District of Columbia’s invitation to rely on the USAO’s new matrix in awarding fees. But as we explain below, the new matrix departs from the statutory requirement that reasonable fees be tethered to “rates prevailing in the community” for the “kind and quality of services furnished.” 20 U.S.C. § 1415(i)(3)(C). We therefore vacate the award and remand for the district court to recalculate the hourly rate based on evidence that focuses on fees for attorneys practicing complex federal litigation in the District of Columbia.

Sometimes Professors Providing Letters of Recommendation Have to Comply with the Fair Credit Reporting Act

by Jeff Sovern

It may seem bizarre, but it appears that recommendations that contain information that goes beyond the transactions or experiences of the person writing the letter are subject to the Fair Credit Reporting Act.  For example, if a law professor writes a letter that points out that a student has job experience in a particular practice area that the recipient of the letter values (assuming that the professor was not the employer or a co-worker),  the FCRA probably applies to the letter.  That means that the student would have a variety of protections under the FCRA and be entitled to certain notices--which makes no sense, but that's where the law takes you.

Let me explain. The FCRA applies to consumer reports issued by consumer reporting agencies (not just credit reports issued by credit bureaus). The statute defines “consumer report” as any written, oral, or other communication of any information by a consumer reporting agency bearing on a consumer’s . . .  character, general reputation, personal characteristics, . . . which is used or expected to be used or collected in whole or in part for the purpose of serving as  a factor in establishing the consumer’s eligibility for . . . employment purposes." 15 USC § 1681a(d)(1). When professors provide recommendations for a job, as we often do for clerkships, for example, what we say bears on the student's character, personal characteristics, etc., so that fits the definition. But there's an exception in § 1681a(d)(2)(A)(i) for reports "containing information solely as to transactions or experiences between the consumer and the person making the report." So if a professor limits the letter to the student's performance in class, it's not a consumer report. But professors sometimes (often?) want to sell a student and present a more complete view and so will include items in the letter that they think will aid the student that go beyond the professor's personal experience with the student. Those letters are consumer reports if the letter is from a consumer reporting agency.

A consumer reporting agency is defined in 15 USC § 1681a(f) as "any person which, for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages in whole or in part in the practice of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer reports to third parties, and which uses any means or facility of interstate commerce for the purpose of preparing or furnishing consumer reports." Schools receive tuition, which presumably covers the cost of writing recommendations, so that probably covers the monetary fee part of the definition. But even if it doesn't, law schools act on a cooperative nonprofit basis when they recommend students in exchange for which students get jobs, enabling schools to brag about their employment statistics.  Students are consumers of the law school's services (the FCRA defines consumer as "an individual" in 15 USC § 1681a(c)). The law school assembles information on students to furnish consumer reports to third parties, and surely uses interstate commerce in doing so.  Accordingly, the FCRA seems to regulate recommendations that go beyond the recommender's personal experiences with the student. This was in fact the conclusion of a May 15, 1974 informal FTC staff opinion from Robert W. Russell. 

What do all this mean as a practical matter? Because the FCRA was designed to protect consumers from misconduct of credit bureaus and users of their information, it contains various protections that don't fit well in the world of law school recommendations. For example, under 15 USC § 1681e, law schools would have to ask recipients of the recommendations (judges?) to certify certain things about their use of the information. Employers who based a decision at least in part on a recommendation would have to provide certain notices to the student, 15 USC § 1681m, after which students could obtain certain information from the school under 15 USC § 1681g.  And so on.  

Of course, professors and schools could avoid this problem by limiting their letters to their own experiences with students, but why is that in anyone's interest? It would limit the ability of schools to put students in the best light possible and tell a more complete story about the student.  There might be some value in subjecting recommendations to the accuracy requirements of the FCRA if recommendations were balanced attempts to appraise students and even warn employers away from students.  But, in my experience, at least, that's not what they are: the author is recommending the student for a job, which is why they're called recommendations. This issue is ripe for attention from Congress. I hope anyone who has a different view of the FCRA will say so in the comments.

 

College Board Says It is LOOKING INTO How It MIGHT Make the Adversity Score Available to Students

by Jeff Sovern

On Saturday, I blogged about the College Board's adversity score.  Today, in response to my inquiry, I received an email from the College Board which contained the following:

We have received questions about whether students and schools can see the content of the Dashboard, and we’re looking into how we might make it available to them. The tool is currently being piloted for use by admissions officers. The Dashboard aggregates publicly available information about schools and neighborhoods. More details can be found here. Again, there is no information specific to individual students, except their SAT score.

The email also included another link to a page headed What You Need to Know About the Environmental Context Dashboard. If you read the links, you will see that the College Board objects to the phrase "adversity score" and prefers that its new product be called Environmental Context Dashboard.

A couple of comments: first, if the College Board can provide the information to colleges, I don't see why it is "looking into" how it "might" make the information available to students. Why not simply commit to providing it to students and say it is looking into how it will make it available to students? Second, I stand by my original view that the College Board ought to commit to meeting at least the standards of the FCRA for providing students an opportunity to make corrections.

Here's an updated letter from state AGs opposing the draft Restatement of the Law of Consumer Contracts

State attorneys general have updated their letter opposing the draft Restatement of the Law of Consumer Contracts. The letter has now been signed by twenty-four AGs. Read the letter here. For our earlier post, on the AG letter, go here.

Supreme Court strongly reaffirms 2009 no-preemption decision in Wyeth v. Levine

The Supreme Court issued its decision today in Merck Sharp & Doehm v. Albrecht. Justice Breyer wrote the controlling opinion, representing the views of six Justices. Justice Alito wrote an opinion concurring in the judgment, representing the views of three justices.

Justice Breyer described the issues this way:

We stated in Wyeth v. Levine that state law failure-to warn claims [regarding prescription drugs] are pre-empted by the Federal Food, Drug,and Cosmetic Act and related labeling regulations when there is “clear evidence” that the FDA would not have approved the warning that state law requires. 555 U. S., at 571. We here decide that a judge, not the jury, must decide the pre-emption question. And we elaborate Wyeth’s requirements along the way.  

This ruling thus reverses the Third Circuit, which held the "clear evidence" question was a factual one for the jury. But, more importantly in my mind, the Court forcefully reaffirmed that impossibility preemption is a demanding defense under Wyeth v. Levine. Under today's decision, plaintiffs will continue to be able to pursue the vast majority of state-law damages claims alleging that a prescription drug manufacturer failed to warn of hazards associated with the drug. That is, preemption will rarely be a barrier to state-law failure-to-warn claims leveled against the manufacturers of prescription drugs.

Here are Merck's key takeaways on that score (all direct quotes from today's majority decision, except the bracketed material):

We then said [in Wyeth] that, nonetheless, “absent clear evidence that the FDA would not have approved a change to Phenergan’s label [the label at issue in Wyeth], we will not conclude that it was impossible for Wyeth to comply with both federal and state requirements.” Ibid. (emphasis added [by Justice Breyer]). *** 

In a case like Wyeth [and like this one], showing that federal law prohibited the drug manufacturer from adding a warning that would satisfy state law requires the drug manufacturer to show that it fully informed the FDA of the justifications for the warning required by state law and that the FDA, in turn, informed the drug manufacturer that the FDA would not approve changing the drug’s label to include that warning. ***

[A]s we have cautioned many times before, the “possibility of impossibility [is] not enough.” PLIVA, Inc. v. Mensing, 564 U. S. 604,625, n. 8 (2011) (internal quotation marks omitted). Consequently, we have refused to find clear evidence of such impossibility where the laws of one sovereign permit an activity that the laws of the other sovereign restrict or even prohibit. See, e.g., Barnett Bank of Marion Cty., N. A. v. Nelson, 517 U. S. 25, 31 (1996); Michigan Canners & Freezers Assn., Inc. v. Agricultural Marketing and Bargaining Bd., 467 U. S. 461, 478, and n. 21 (1984). ***

We do note, however, that the only agency actions that can determine the answer to the pre-emption question, of course, are agency actions taken pursuant to the FDA’s congressionally delegated authority. The Supremacy Clause grants “supreme” status only to the “the Laws of the United States.” U. S. Const., Art. VI, cl. 2. And preemption takes place “‘only when and if [the agency] is acting within the scope of its congressionally delegated authority, . . . for an agency literally has no power to act, let alone pre-empt the validly enacted legislation of a sovereign State, unless and until Congress confers power upon it.’” New York v. FERC, 535 U. S. 1, 18 (2002) (some alterations omitted). Federal law permits the FDA to communicate its disapproval of a warning by means of notice-and-comment rulemaking setting forth labeling standards, see, e.g., 21 U. S. C. §355(d); 21 CFR §§201.57, 314.105; by formally rejecting a warning label that would have been adequate under state law, see, e.g., 21 CFR §§314.110(a), 314.125(b)(6); or with other agency action carrying the force of law, cf., e.g., 21 U. S. C. §355(o)(4)(A). The question of disapproval “method” is not now before us. And we make only the obvious point that, whatever the means the FDA uses to exercise its authority, those means must lie within the scope of the authority Congress has lawfully delegated.

Justice Breyer's opinion was joined by Justices Thomas, Ginsburg, Sotomayor, Kagan, and Gorsuch. Justice Alito's opinion concurring in the judgment was joined by Chief Justice Roberts and Justice Kavanaugh.

UPDATE: If you have any doubt that the drug industry actually lost today and that the industry's principal objective was to make it easier for drug-company defendants to win impossibility-preemption defenses -- and to weaken Wyeth -- that doubt will be erased by reading Merck's cert petition. 

 

 

  

Former CFPB director Richard Cordray opposes the draft Restatement of the Law of Consumer Contracts

Yesterday, former Director of the Consumer Financial Protection Bureau Richard Cordray wrote to the Director of the American Law Institute Richard Revesz opposing the controversial draft Restatement of the Law of Consumer Contracts. The Restatement will be voted on tomorrow by the ALI's membership. Here are excerpts from Cordray's letter:

I write to express deep concerns about the American Law Institute’s Tentative Draft Restatement of the Law, Consumer Contracts.  I write as former Director of the U.S. Consumer Financial Protection Bureau and former Ohio Attorney General, two positions where I was tasked with protecting consumers.  In my view, the Tentative Draft would endorse principles of law that would facilitate malefactors in mistreating and harming individual consumers. *** The Tentative Draft Restatement is deeply troubling because it undermines contract as a meaningful protection for consumers.  It would bind consumers to all of a business’s “standard terms”—that is, to all the terms of a contract of adhesion if the consumer: (1) had notice of and opportunity to review the terms of the contract and (2) indicated assent to transact, though not necessarily assent to the particular terms.  Under the Tentative Draft’s rule, a consumer could readily be bound to terms the consumer does not comprehend and to which the consumer would never knowingly consent, such as unilateral modifications; class action waivers; commitment to resolve disputes through binding mandatory arbitration; and broad privacy waivers allowing tracking of consumers’ internet browsing, the use of facial recognition technology, and the further sale or distribution of the resulting personal information. The Tentative Draft’s approach is inconsistent with the fundamental basis of contract law, namely that contracts are enforced by law because they are presumed to result in mutual gains from trade and thereby enhance social welfare.  Such mutual gains can only be assumed to exist if the parties knowingly agree to the terms of the deal.

Read Cordray's entire letter here. For some of this blog's recent coverage of the controversial restatement, go here, here, and here. 

The SAT Adversity Score Should Be Subject to the Fair Credit Reporting Act Protections

by Jeff Sovern

The Wall Street Journal has reported that the College Board, providers of the SAT tests, will give colleges an adversity score for each applicant who takes the SAT to aid college in admissions decisions.  As the Journal explains:

This new number, called an adversity score by college admissions officers, is calculated using 15 factors including the crime rate and poverty levels from the student’s high school and neighborhood. Students won’t be told the scores, but colleges will see the numbers when reviewing their applications.

In light of reports that SAT scores tend to correlate with the income and education of the parents, this score could be useful to colleges. But it is troublesome that the College Board won't tell students their score.  As Bob Sullivan has asked, what if the College Board gets the score wrong? That isn't a fanciful notion. The FTC's years-long study of credit report accuracy found that one in five credit reports contain an error even though credit bureaus have decades of experience obtaining and compiling credit records. It is easy to imagine that some student adversity scores would also be based on erroneous information, especially as the score itself is a new creation and so may still have some bugs, despite the College Board's testing.   Consumers have a right to examine their credit reports, and that provides some--albeit weak--measure of accountability. They also have rights to seek the correction of erroneous information. Why should the College Board adversity score be any different? Given the importance of college admissions to many applicants, the adversity score should be subject to the same disclosure and correction mechanisms that credit reports are.  The College Board's decision not to disclose the scores reduces the likelihood that any errors it makes will be caught. It also make me wonder why it fears having students know their adversity score. If the FCRA doesn't already apply to the adversity score (something I hope to explore in a later post if my schedule permits), I hope Congress will amend the FCRA to extend its protections the the adversity score. [Disclosure: I have a child who expects to apply to colleges in the fall.]

Opposition to CFPB's proposed rescission of protections for payday borrowers

Public Citizen, along with the Center for Responsible Lending and several other consumer-advocacy groups, submitted a lengthy comment objecting to the CFPB's proposal to rescind many aspects of the agency's own payday lending rule, issued in 2017 to protect consumers from harmful payday lending practices. The comment is here. If you are not up for reading the full 220-page document, the executive summary is available here.

Investigation shows that things unrelated to driving record -- such as sex and zip code -- can jack up car insurance rates

An investigation by the Chicago Sun-Times found that "[y]ou could be a great driver, but still have to pay more [for car insurance] because of reasons unrelated to driving," such as sex, where you live, and whether you rent or own your home. Read this Sun-Times article by Stephanie Zimmerman for more details. 

Congress is considering privacy legislation – be afraid

by Jeff Sovern

That's the title of my latest essay for The Conversation, about how preemption of state privacy laws could harm consumers.  Here's an excerpt:

[R]ather than circumventing state laws, a federal privacy law should work in partnership with them – just as federal laws regulating auto safety such as airbag requirements operate in tandem with state regulations that govern related issues such as how fast motorists can drive.

Industry advocates, however, don’t want federal and state laws to exist side by side because they say companies will have trouble following the rules of different states. Businesses had the same concerns about state data breach laws, and testimony from Marriott’s CEO suggests the company didn’t find it too troublesome to comply with them, however different.

It’s more likely, then, that companies realize that it will be easier for their lobbyists to win a victory in one legislature – Congress – than in 50 states.

Lobbyists have also argued consumers would be bewildered by such a patchwork of state privacy laws. They claimed, for example, that a consumer driving from Biloxi, Mississippi, to Bellevue, Washington, would be confused by the different privacy regimes she would encounter.

But that same person – during that same drive – copes with a wide variety of traffic laws. Drivers seem to be able to navigate those different laws just fine.

A proposal to provide, under current law, some bankruptcy relief to student-loan debtors

Law profs Matthew Bruckner, Brook Gotberg, Dalie Jimenez, and Chrystin Ondersma have written A No-Contest Discharge for Uncollectable Student Loans. Here is the abstract (complete with a list of circumstances in which, the authors say, student-loan debt should be discharged in bankruptcy on a no-contest basis):

Over 44 million Americans owe more than 1.4 trillion dollars in student loan debt. This debt is uniquely difficult to shed in bankruptcy; even attempting to do so usually requires costly and contentious litigation with the Department of Education, and initial success may be followed by years of appeals by the Department of Education. As a result, very few student loan borrowers even attempt to discharge their student loan debt in bankruptcy.

In this Article, we call on the Department of Education to develop a set of nine easily calculable and verifiable circumstances in which it will not contest a debtor’s attempt to discharge her student loan debt. Nearly every category of “no-contest” discharge represents a circumstance where the debtor would clearly suffer an undue hardship if forced to continue to attempt repayment, such that the Department of Education should conserve taxpayer dollars by consenting to discharge. Specifically, we urge the Department of Education to allow a “no-contest” discharge when the debtor’s income is less than 150% of the federal poverty level and:

(1) household income has been at or below the federal poverty level for the last four years;
(2) the debtor receives disability benefits under the Social Security Act;
(3) the debtor receives disability benefits because of military service;
(4) the debtor’s income is derived solely from retirement benefits;
(5) the debtor is a caregiver of an adult or child as defined in the Lifetime Respite Care Act;
(6) the debtor is a family caregiver of an eligible veteran;
(7) the debtor did not receive a degree from the institution or the institution closed;
(8) the debtor owes less than $5,000; or
(9) the debtor has been repaying their student loans for more than 25 years. 

Our proposal will not solve every problem, but it would go a long way towards resolving many of the grosser inequities currently associated with student loans and their treatment in bankruptcy.

Dept of Education blocking CFPB oversight of student loan servicing

In a letter responding to an inquiry from Senator Warren, the director of the Consumer Financial Protection Bureau says that the Education Department is hampering the CFPB's efforts to protect borrowers by performing oversight of the student loan industry. The Senators' letter has asked whether the federal regulator had "abandoned its supervision and enforcement activities" related to more than $1 trillion in student loans.

The CFPB letter states that companies that student loan servicing companies are refusing to share information that the CFPB needs to perform oversight because the Department of Education has issued guidance telling them not to do so.

NPR has the story, here, along with a link to the CFPB's letter.

ALI Makes Its Tentative Draft Broadly Available to the Public, while Insisting that It Could Sue for Infringement

by Paul Alan Levy

As reflected in an update to my blog post from yesterday, ALI has issued a blustery letter insisting that it did no wrong by trying to enforce its copyright against Adam Levitin's publicly posting of the Tentative Draft its Restatement, while at the same time publicly posting the Tentative Draft.

23 state AGs urge American Law Institute to reject draft Restatement of the Law of Consumer Contracts

Yesterday, 23 state attorneys general wrote to all members of the American Law Institute urging them to reject the draft Restatement of the Law of Consumer Contracts, calling it "an abandonment of important principles of consumer protection in exchange for illusory benefits." Read the AGs' letter here. For our other recent coverage of the draft Restatement, including the ALI's effort to undermine opposition to the draft through copyright law, go here and here.

American Law Institute Misusing Copyright to Prop Up Its Proposed Restatement on the Eve of Voting

by Paul Alan Levy

The Proposed Restatement of the Law of Consumer Contracts has been discussed on this blog many times. It is exceptionally controversial: it has been opposed by a large coalition of consumer and civil rights advocacy groups (including Public Citizen) as well as attorneys general from roughly half the states. The US Chamber of Commerce and a large coterie of banking and other industry trade groups has also opposed the Draft from a different perspective. As part of his campaign to get the draft rejected by the ALI membership, Georgetown law professor Adam Levitin posted the draft on Dropbox so that his readers could readily access the document and thus understand the basis for the objections. He intended to leave it posted only until the ALI membership conducted its vote on the draft, scheduled to be held at ALI’s annual meeting on May 21.

On the eve of that meeting, ALI’s leadership stepped in with a series of peremptory emails demanding that the document be taken down. It asserted that Tentative Drafts are subject to ALI’s copyright, and that ALI finances its activities by selling copies of its Restatements; in response to Levitin’s invocation of fair use, it insisted that only excerpts can qualify as fair use.

Yesterday, I responded to ALI’s demands, showing that copying the entirety of a copyrighted work can be fair use when justified by the purpose of the use, such as criticism, showing that the other fair use factors supported Levitin’s right to show the public the full proposed draft, and arguing that ALI was engaged in copyright misuse, attempting to disable the "vote no" campaign.

Kavanaugh v. Gorsuch, er, I mean, Apple, Inc. v. Pepper

For the second time this Supreme Court Term, Justice Gorsuch has dissented from a majority opinion by Justice Kavanaugh. Both times, the beneficiary of Kavanaugh's vote has been a plaintiff whose cause of action Kavanaugh would recognize but Gorsuch would not. In today's opinion, Apple, Inc. v. Pepper, the result is that consumers seeking to sue Apple for monopolizing the retail market for iPhone apps can proceed with their suit. (The previous Kavanaugh-Gorsuch split came in a case called Air & Liquid Systems Corp. v. DeVries, in which Kavanaugh's opinion allowed plaintiffs to sue shipbuilders for failing to warn of harms caused by asbestos components that the shipbuilders did not themselves manufacture but knew would be used in the ships.)

The Apple decision concerned whether the so-called "Illinois Brick" rule, which prohibits indirect purchasers from bringing antitrust claims against companies higher up a supply chain with whom they didn't do business directly, bars app purchasers from suing Apple. Apple claimed that app purchase consumers are sorta like indirect purchasers because, according to Apple, app developers and not Apple determine the prices that will be paid for their apps.

Kavanaugh crisply disagreed. ''It is undisputed that the iPhone owners bought the apps directly from Apple. Therefore, under Illinois Brick, the iPhone owners were direct purchasers who may sue Apple for alleged monopolization." There's a bit more to the opinion than that, but that is the gist. Kavanaugh's "straightforward" conclusion was joined by the Court's four liberals, while the remaining conservatives joined Justice Gorsuch.

States accuse generic drug manufactrurers of price fixing

On Friday, Connecticut and a coalition of 44 states sued the biggest generic drug manufacturers, accusing them of a systematic conspiracy to bilk consumers out of billions of dollars. Last night's 60 Minutes covered the story, here. The Connecticut Attorney General's press release is here.

Trolling for Copyright Claims Against Online Hosts

by Paul Alan Levy

Those who have been following the issue of copyright trolls for many years may remember that one of the prime features of the Righthaven technique for shaking down unwitting bloggers for payments was to concentrate its litigation campaign on those who made the mistake of failing to register with the Copyright Office their DMCA agent for the receipt of takedown notices. Registration is, in fact, a technical requirement for enjoying DMCA immunity, and those who had not registered paid a heavy price until some enterprising litigants found other ways to put that copyright troll out of business.

Higbee and Associates Has a New Angle for Demanding Payments

This spring, I was been able to identify Higbee and Associates as the newest operator working from the Righthaven playbook. This discovery came about as a result of my blog post a few months ago stemming from my representation of Homeless United for Friendship and Freedom, opposing a copyright infringement demand letter that the Higbee firm sent on behalf of Agence France Presse. Following that post, I have received a steady stream of requests from targets of his demand letters. For many of these targets, the best I could do was tell them that they had infringed a copyright, and to suggest approaches that they might take in dealing with the demand.  When the damages demand was high enough to warrant hiring counsel, on some occasions I have helped them find good copyright counsel to negotiate a resolution;the Higbee firm's reputation is bad enough that a number of lawyers are glad to take these cases. In schmoozing with some of the targets, I got wind of bargaining strategies that they were using with Higbee, and I have shared those around.

But one pattern has emerged recently — demands against people who hosted discussion sites on a variety of topics, where photos copyrighted by Higbee clients, or links to such photographs, had been posted by their users, and where the host had not learned that DMCA immunity depends on registration of the DMCA agent with the copyright office.

Timothy D. Lytton Book: Outbreak: Foodborne Illness and the Struggle for Food Safety

Tim Lytton  at Georgia State has written Outbreak: Foodborne Illness and the Struggle for Food Safety. Here's the blurb:

Foodborne illness is a big problem. Wash those chicken breasts, and you’re likely to spread Salmonella to your countertops, kitchen towels, and other foods nearby. Even salad greens can become biohazards when toxic strains of E. coli inhabit the water used to irrigate crops. All told, contaminated food causes 48 million illnesses, 128,000 hospitalizations, and 3,000 deaths each year in the United States.
           
With Outbreak, Timothy D. Lytton provides an up-to-date history and analysis of the US food safety system. He pays particular attention to important but frequently overlooked elements of the system, including private audits and liability insurance.
Lytton chronicles efforts dating back to the 1800s to combat widespread contamination by pathogens such as E. coli and salmonella that have become frighteningly familiar to consumers. Over time, deadly foodborne illness outbreaks caused by infected milk, poison hamburgers, and tainted spinach have spurred steady scientific and technological advances in food safety. Nevertheless, problems persist. Inadequate agency budgets restrict the reach of government regulation. Pressure from consumers to keep prices down constrains industry investments in safety. The limits of scientific knowledge leave experts unable to assess policies’ effectiveness and whether measures designed to reduce contamination have actually improved public health. Outbreak offers practical reforms that will strengthen the food safety system’s capacity to learn from its mistakes and identify cost-effective food safety efforts capable of producing measurable public health benefits.

More information and purchase information here. (HT: Ray Brescia) 

Did the AG-Credit Bureau Settlement Requiring Employees with Discretion to Review Consumer Disputes Change Things?

by Jeff Sovern

Until 2015, when consumers submitted disputes to credit bureaus, the credit bureaus submitted the dispute to the creditor which had furnished the information, and if the creditor verified that the information was correct, the credit bureau reportedly would nearly always continue reporting the information in the consumer's credit report, despite the Fair Credit Reporting Act's direction to credit bureaus to conduct a reasonable reinvestigation in such circumstances.  In 2015, various attorneys general reached a settlement with the big credit bureaus that provides that when consumers submit documents supporting their position in a dispute, a credit bureau employee with discretion to revise the consumer’s credit file must review the documents before the bureau can report the original information as verified. Now that it's been four years, I'm wondering if the consumers' experiences when they submit disputes to credit bureaus have changed.  Does anybody know? If so, please post a comment.

Attack on Consumer Free Speech in Texas

by Paul Alan Levy

The spring, an unusual coalition of forces made a serious run at gutting the Texas Citizens’ Participation Act, the Texas version of state anti-SLAPP suits that protects consumers and citizen activists from baseless lawsuits intended to stop them from voicing criticisms of businesses and powerful political figure in their communities. A significant battle remains – enduring that the law continues to protect the ability of consumer critics of business to obtain afforable legal representation to fight SLAPP suits.

The Need for Anti-SLAPP Laws

Well-written anti-SLAPP laws protect individuals who have been targeted by baseless litigation over things they say to government officials or during government proceedings, or more generally their speech on issues of public interest.  Such speakers can get the suit thrown out at an early stage, without having to run up the expense of paying a lawyer to bear the burdens of litigation including discovery, by forcing the plaintiff to show both a factual and a legal basis for believing that the suit has a realistic chance of success on the merits. And, if the suit proves to be baseless in that the plaintiff cannot show that it has a genuine claim, not only is the case dismissed, but thet SLAPP’d defendant gets an award of attorney fees.

Because, in this kind of case, the reason for suing is often to suppress future criticism rather than to win in the case in the conventional manner — that is, by securing a judgment or a monetary settlement — anti-SLAPP laws provide a valuable protection against the chilling effect that can suppress fair criticisms.  At the same time, knowing that the tactic of bringing baseless suits over speech won't succeed (and can be costly), the laws discourage the filing of baseless lawsuits against speech.  Moreover, the provision for awards of attorney fees means that even ordinary citizens who otherwise couldn’t afford to hire a lawyer to protect her legal rights can often get the case taken by a lawyer on a contingent fee basis, hoping to be paid though an attorney fee award.  In states with strong anti-SLAPP laws, lawyers can specialize in anti-SLAPP work just as the provisions for fee awards in discrimination suits, consumer suits, and other kinds of suits fostered the emergence of a specialize bar representing the impecunious in such cases.

A holistic view of food safety and its regulation

That's the topic of The New Food Safety by law profs Emily Leib and Margot Pollans. Here is the abstract:

A safe food supply is essential for a healthy society. Our food system is replete with different types of risk, yet food safety is understood as encompassing only foodborne illness and other risks related directly to food ingestion. This Article argues for a more comprehensive definition of food safety, one that includes not just acute, ingestion-related risks, but also whole-diet cumulative ingestion risks, and cradle-to-grave risks of food production and disposal. This broader definition, which we call “Food System Safety,” draws under the header of food safety a variety of historically siloed, and often under-regulated, food system issues including nutrition, environmental protection, and workplace safety. The current approach to food safety is inadequate. First, it contributes to irrational resource allocation among food system risks. Second, it has collateral consequences for nutrition, environmental protection, and workplace safety, and, third, its limited focus can undermine efforts to achieve narrow food safety. A comprehensive understanding of food safety illuminates the complex interactions between narrow food safety and other areas of food system health risks. We argue that such an understanding could facilitate improved allocation of resources and assessment of tradeoffs, and ultimately support better health and safety outcomes for more people. We offer a variety of structural and institutional mechanisms for embedding this approach into agency action.

Report on restoring individuals' access to the civil justice system

The Center for American Progress today released a report discussing structural reforms to the court system and suggesting reforms to restore access to the courts -- two topics that are discussed separately in the report but are surely related. The reforms suggested to restore individuals' access to the civil justice are not new ideas but remain important.

• Restoring plaintiffs’ ability to bring class action suits
• Prohibiting forced arbitration in all consumer and employment contracts
• Restricting secret settlements and record sealing in cases affecting public safety
• Restoring the power of private attorneys general to enforce federal law
• Restoring simpler pleading standards

The report does a nice job of explaining the issues and the need for change. The full report is here.

CFPB proposes new rule on calls, texts, and emails from debt collectors

The Consumer Financial Protection Bureau is proposing a new rule that would allow debt collectors to send consumers an unlimited number of texts and emails.

The agency says that its rule would be good for consumers. The Washington Post reports, however, that consumer advocates worry the CFPB is giving the industry a new way to violate consumers’ privacy. "While many Americans understand how to deal with a pesky creditor calling their landline, their texts, emails and social media are new, more personal territory."

The proposed rule would also cap a debt collector's calls to a consumer at seven calls each week, and provide that the debt collector could not call again for one week after reaching the consumer.

The proposed rule is here. The Washington Post article is here.