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April 30, 2015

Good for Alabama for Passing Bill to Reverse State SC’s ‘Innovator Liability’ Ruling

A bill is on its way to the desk of Alabama Governor Robert Bentley that The Wall Street Journal is calling “a major trial lawyer defeat.”

The bill would undo an incredibly harmful Alabama State Supreme Court decision that would hold the developers and manufacturers of brand-name drugs liable for harm caused to people who take generic versions of those drugs. The idea is called “innovator liability,” and it would have allowed drug companies to be sued for products that they didn’t make or sell.

In effect, the Alabama Supreme Court’s decision would be hanging out a giant “welcome” sign to trial lawyers to fill up the state’s courts with specious lawsuits.

The Wall Street Journal explains how this came about:

In January 2013, the Alabama supreme court had a senior moment when it said plaintiff Danny Weeks (Wyeth v. Weeks) could sue Wyeth (since bought by Pfize) over side effects from the acid-reflux drug Reglan. Mr. Weeks never took Reglan, opting for the generic version, metoclopramide. Wyeth had sold the rights to Reglan long before Mr. Weeks used the generic medication between 2007 and 2009.

Product liability claims typically require evidence that the company being sued designed, made or sold the product alleged to have done harm. In this case the lawyers tried an end-run by arguing it as a fraud case. On rehearing in August 2014, the Alabama court again bought the snake oil, 6-3, finding liability because the brand-name manufacturer controlled the warning label that doctors and patients say they rely on. That decision broke with more than 100 courts in 30 states and seven federal courts of appeal that have rejected theories of innovator liability.

Gov. Bentley has said that he’ll sign the bill which, as The Wall Street Journal points out, “may discourage legal copycats in other states.”

That would be a good thing.

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