American Home Products Corp. v. Ferrari – The Georgia Supreme Court Reinterprets the Vaccine Act
For years, courts have consistently held that the National Childhood Vaccine Injury Compensation Act of 1986 (42 USC § 300aa-1, et seq.) (the “Vaccine Act”) bars vaccine-related product liability claims under state law. However, in American Home Products Corp. v. Ferrari, ____ S.E.2d ____ 2008 WL 4452358 (Ga. 2008), the Georgia Supreme Court dramatically reinterpreted the Vaccine Act and held that the Act “does not preempt all design defect claims, but instead provides that a vaccine manufacturer cannot be held liable for defective design if it is determined, on a case-by-case basis, that the injurious side effects of the particular vaccine were unavoidable.” In other words, a jury may now decide whether alleged vaccine side effects were avoidable with a safer design. This opinion reflects a clear break with prior precedent and could signal a larger shift in judicial interpretation of the Vaccine Act and an increase in vaccine-related product liability cases.
The National Childhood Vaccine Injury Compensation Act of 1986
“Congress passed the Vaccine Act in response to an upsurge of vaccine-related litigation that threatened to drive manufacturers away from vaccine production or to cause remaining manufacturers to increase their prices significantly.” Blackmon v. American Home Products Corporation, 328 F. Supp. 2d 659 (S.D. Tex. 2004). The Vaccine Act established the National Vaccine Injury Compensation Program, a mandatory, no-fault system which is “designed to encourage childhood vaccination by providing a streamlined system for compensation in rare instances where an injury results from vaccination.” See Blackmon, at 663. “A person alleging a vaccine-related injury can obtain compensation by filing a petition with the Vaccine Court. The petitioner need not prove fault nor causation; he only needs to show that he received the vaccine and then suffered certain symptoms within a defined period.” Sykes v. Glaxo-Smith Kline, 484 F. Supp. 2d 289, 297 (E.D. Pa. 2007); see also 42 U.S.C. §§ 300aa-13, 300aa-14. An alleged defective design claim, like that brought by the plaintiffs in Ferrari, would be compensated under this system. See Id.
Under the Vaccine Act, however, a plaintiff may reject the judgment of the Vaccine Court and instead bring suit in a traditional tort claim under state law. See 42 U.S.C. § 300aa-21. But “the Vaccine Act includes certain limitations on state tort claims designed to free manufacturers from the specter of large, uncertain tort liability, and thereby keep vaccine prices fairly low and keep manufacturers in the market.” Sykes, 484 F. Supp. 2d at 297 (citing Schafer v. Am. Cyanamid Co., 20 F.3d 1, 4 (1st Cir. 1994)). Specifically, Section 22 (b) of the Vaccine Act provides that
- No vaccine manufacturer shall be liable in a civil action for damages arising from a vaccine-related injury or death associated with the administration of a vaccine after October 1, 1988, if the injury or death resulted from side effects that were unavoidable even though the vaccine was properly prepared and was accompanied by proper directions and warnings.
- For purposes of paragraph (1), a vaccine shall be presumed to be accompanied by proper directions and warnings if the vaccine manufacturer shows that it complied in all material respects with all requirements under the Federal Food, Drug, and Cosmetic and section 351 of the Public Health Service Act.
42 U.S.C. §300aa-22 (b)(1)-(2). Until Ferrari, Section 22 (b)(1) has been uniformly interpreted as a bar to state law design-defect claims.
The Georgia Case
Marcelo and Carolyn Ferrari brought suit in the state court of Fulton County, Georgia, against several vaccine manufacturers claiming that their son’s neurological damage was caused by the vaccine preservative thimerosal, which contained the toxic substance mercury. The lawsuit, which alleged both strict liability and negligence, claimed that the vaccine-manufacturer defendants could and should have manufactured children’s vaccines without thimerosal before the plaintiffs’ son was vaccinated in 1998. The trial court granted the manufacturers’ partial summary judgment, finding that the plaintiffs’ design defect claims, their failure-to-warn claims and their breach of warranty claims as to defective design, were preempted by the Vaccine Act. The Georgia Court of Appeals reversed. See Ferrari v. American Home Products Corporation, 650 S.E.2d 585 (Ga. App. 2007).
The Georgia Supreme Court’s Analysis
The Georgia Supreme Court and the Court of Appeals’ summarized the parties’ arguments as follows: “[Defendants] argue that the Vaccine Act bars [Plaintiffs’] design defect claims because any vaccine-related injury would be deemed ‘unavoidable’ if the vaccine was properly prepared and accompanied by proper warnings.” Ferrari, at * 1. In other words, unless the manufacturer deviated from the FDA-approved design for the vaccine, state law tort claims are barred. See Sykes, 484 F. Supp. 2d at 303. “[Plaintiffs] on the other hand, assert that design defect claims are barred only if the side effects are determined on a case-by-case basis to be ‘unavoidable’ due to lack of a safer design.” Ferrari, at * 1.
The Court noted that two federal courts and New York state courts have considered whether subsection (b) (1) of Section 22 preempts all claims that a vaccine was defectively designed. See Sykes, 484 F. Supp. 2d 289; Bruesewitz v. Wyeth, 508 F. Supp. 2d 430 (E.D. Pa. 2007)(same court as Sykes); Blackmon v. American Home Products Corp., 328 F. Supp. 2d 659 (S.D. Tex. 2004); Militrano v. Lederle Laboratories, 3 Misc.3d 523, 769 N.Y.S.2d 839 (Sup.Ct. 2003) aff’d 26 A.D.3d 475, 810 N.Y.S. 2d 506 (App. Div. 2006). Each of these cases held that state law design-defect claims are preempted by the Vaccine Act. Ferrari, at *3.
While rejecting their ultimate conclusions, the Ferrari Court recognized that the cases that have examined this issue have “correctly recognized that Congress modeled subsection (b) (1) after comment k to § 402A of the Restatement (Second) of Torts.” Id. Comment k to § 402A excepts from strict liability the seller of “unavoidably unsafe products,” which “in the present state of knowledge, are quite incapable of being made safe for their intended and ordinary use.” Restatement (Second) of Torts § 402A, cmt k. Comment k notes “[s]uch a product, properly prepared, and accompanied by proper directions and warning, is not defective, nor is it unreasonably dangerous.” Id. The Georgia Court found that “[m]ost of the states, including Georgia, that have adopted Comment k have applied it in a more limited fashion and on a case-by-case basis.” Id. (Citations omitted.) The Court, therefore, rejected Sykes and Blackmon that criticized the plaintiff-suggested case-by-case determination and found that the Vaccine Act “is best understood as barring liability only for those side effects which were unavoidable by means other than proper manufacturing and packaging.” Id., at * 4-5. The Georgia Supreme Court ultimately held that “subsection (b)(1) clearly does not preempt all design defect claims against vaccine manufacturers, but rather provides that such a manufacturer cannot be held liable for defective design if it is determined, on a case-by-case basis, that the particular vaccine was unavoidably safe.” Id., at *7.
In holding that the limited no-fault compensation structure provided by subsection (b)(1) of the Vaccine Act “would have the perverse effect of granting complete [tort] immunity from design defect liability to an entire industry” the Georgia Supreme Court has clearly departed from the established acknowledgement that “Congress intended to provide an umbrella under which manufacturers would improve the safety of their products while remaining immune from design defect claims made possible by the successful innovation of safer alternative designs.” Id. at *8; Bruesewitz, 508 F. Supp. 2d 430, 445; see also Sykes, 484 F. Supp. 2d 289, 301 (noting that “[c]ase-by-case consideration would also expose manufacturers to inconsistent standards, as juries might hold manufacturers liable for design defects in drugs approved by the FDA.”); Blackmon, 328 F. Supp. 2d 659, 665 (finding that construing the statute to “permit the jury to decide whether a particular side effect was unavoidable, would provide no protection against design defect claims ... and would strip the passage of all meaning”).
The Georgia Supreme Court recognizes it will not have the final word on this issue and concluded its opinion with an invitation for further review: “[i]n the absence of any clear and manifest congressional purpose to [grant complete immunity from design defect liability] we must reject such a far-reaching interpretation of [subsection (b)(1)], at least until the Supreme Court of the United States has spoken on the issue.” Ferrari, at *8. However, unless or until Congress or the United States Supreme Court rejects Ferrari’s interpretation of the Vaccine Act, this opinion, which has been called a “landmark case” by autism activists,1 is capable of initiating a dramatic shift in vaccine litigation throughout the country. At the very least, we may soon see a dramatic rise in the number of vaccine lawsuits in Georgia.
1 See Holland, Mary, Thimerosal Goes to Court: American Home Products Corp. v. Ferrari, Age of Autism, October 10, 2008 (available at http://www.ageofautism.com/2008/10/thimerosal-goes.html).