Reprinted with permission from Michigan Lawyers Weekly
Cite 26 Mich.L.W. 631 April 23, 2012 Michigan Lawyers Weekly • 3
Drug immunity bill
But if it can’t pass, some lawmakers want to know: At what cost?
By Carol Lundberg be harmful to business at a time when Michigan Michigan law prohibits product liability cases
needs to send a business-friendly message to the against makers of FDA-approved drugs.
If lawmakers choose not to rescind the law corporate world. So Michigan could not recover the $20 million
that keeps Michigan residents from suing drug So far, the statute — MCL 600.2946(5) — re- spent on Vioxx prescriptions dispensed to Med-
companies, a few representatives in the Legis- mains in place. icaid patients. That caused members of both
lature say that they should at least know what Last October, the Michigan Supreme Court parties to rethink the state’s FDA defense for
it’s costing the state. upheld the Michigan Court of Appeals’ pub- drug manufacturers.
For years, Democrats have fought to repeal a lished opinion in Attorney General State of A look around the country at what other states
law that prohibits people from suing drug manu- Michigan, et al. v. Merck Sharp & Dohme Corp. are able to recover has some lawmakers wondering
facturers if the drug was compliant with federal It said that the Michigan Attorney General if Michigan should be able to do the same.
food and drug administration standards. could not join the other 49 states in their suit Earlier this month, an Arkansas judge fined
But it has been met with strong Republican against the manufacturer of Vioxx because Johnson & Johnson and its Janssen subsidiary
opposition by lawmakers who say that it would more than $1 billion after a jury found the compa-
nies had engaged in “false or deceptive acts” in
LW photo by Carol Lundberg
2003 by claiming its drug Risperdal was safer than
other antipsychotic drugs. And earlier this year, the
company settled with the Texas Attorney General
to pay $158 million in a similar suit.
Last month, state representatives Ellen Cogen
Lipton, D-Huntington Woods, and Fred Durhal, D-
Detroit, proposed a budget amendment to the
House Appropriations Subcommittee on General
Government. The amendment would require
Michigan’s Attorney General to report
the money lost by Michigan residents
from not participating in the federal
class-action lawsuits brought by
states against drug companies whose
products were found to be harmful.
And it received bipartisan
support, passing out of sub-
“It does nothing to repeal
or change the underlying
drug immunity statute,”
“We are arguing that Michigan’s drug immunity defense is an Lipton said.
affirmative defense. Our allegation was that they were not in ‘A problem that
compliance with the FDA when the drug left the manufacturer.” Lipton said that she thinks
Michigan is missing out on being
— Alyson Oliver, Oliver Law Group
able to recover millions of dollars
See “Drug immunity,” page 23
LW photo by Douglas J. Levy
ON THE STAND
When the workday ends, real Is there a place in St. gone to costume parties, I’ve
estate attorney C. Kim Shierk Joseph you cherish? dressed up like her. She’s an
likes to retreat to the easel. The lake and the beaches. It’s a easy one to dress up as.
“You turn your mind off from great place to walk and relax.
work, and totally get absorbed,” When I grew up, there was an Considering you deal in real
she said of her passion for oil amusement area there called estate, what was the worst
painting, mostly landscapes and Silver Beach, with a roller place you ever lived?
flowers. “I do it as often as I can, coaster and a funhouse. It’s In undergrad at MSU, one
but never often enough.” been long torn down, but in the summer I lived in student
She’s grown up literally on recent past they built a carousel housing. We were sitting at the
canvas: her late father, Ted and made replicas of the horses kitchen table eating dinner one
Shierk, was a portrait artist in that were part of the original night, and the ceiling fell in on
her hometown of St. Joseph, and amusement park’s carousel. us. I think it was a bad roof that
she and her siblings would be was leaking.
frequent subjects. What’s something in your
Today, Shierk, who is chair of house that you should really Your pet peeve?
the Real Property Law Section of throw out, but probably Overuse of the word “largely.”
the State Bar of Michigan, is in never will?
the process of cataloging his
My husband has a pair of You deal with condominiums
works, and it’s offered her some
humongous stereo speakers. They as part of your practice. What
take up so much space. But I’m was the most unusual bylaw
“What’s interesting is, you
afraid that if I throw them out, you ever came across?
look at the paintings and
he’d follow them out the door. The one that comes to mind was
see how times have changed,”
she said. “We were involved in a commercial project in Florida.
scouts, and there are several If a sandwich was named It expressly prohibited the
paintings of my brother, my after you, what would be owners from maintaining
sister and I in our scout uni- in it? alligators on the premises.
forms, and they were the old It’d be filled with veggies on
uniforms.” whole-wheat bread — and Is there something you keep
topped with hot fudge. There’s in your office as a
What are your other always that conflict I have to motivator?
C. Kim Shierk means of decompression? eat healthy, and then I spoil it. Pictures of my children, because
I’ve been doing Zumba for a so long as I have college tuition to
Myers Nelson Dillon & Shierk PLLC, Bloomfield Hills What famous person can you
couple of years. It’s high pay for, they’re my motivation to
Education: University of Detroit School of Law energy, and you sure feel best impersonate? come into the office every day.
Specialties: Residential and commercial real estate development great afterward. Sandra Bullock. When we’ve — DOUGLAS J. LEVY
Cite 26 Mich.L.W. 651 April 23, 2012 Michigan Lawyers Weekly • 23
[ Verdicts & Settlements ]
71-year-old male driver seeks underinsured motorist benefits
Hematoma’s origin argued Type of action: Case evaluation: $400,000
cause there was no evidence of head trau-
ma in the ER. Rather, it was asserted, it
by defense as pre-existing Underinsured motorist benefits
Most helpful experts: could have been caused by plaintiff’s pre-
Type of injuries: Dr. Martin Belkin, neurology, West existing combination of diabetes, hyper-
condition; jury disagrees Traumatic brain injury Bloomfield; Dr. Renee Applebaum, tension, and blood thinners. Defense coun-
Name of case: Lucas v. Grange neuropsychology, Bingham Farms; Dr. sel relied on his cross-examination of the
$500,000 Insurance Co. of Michigan Rick Olson, neurosurgery, Royal Oak treating doctors, who conceded that plain-
Plaintiffs Leon and Mildred Lucas were tiff ’s pre-existing conditions could have
Court/Case no./Date: Insurance carrier: Grange
awarded $500,000 by an Oakland County coincidentally caused a brain bleed.
Oakland County Circuit Court; Attorney for plaintiff: Plaintiff argued that he did hit his head
jury in their lawsuit seeking underin- 10-114496-NI; Jan. 19, 2012
sured motorist benefits from defendant Brian Gijsbers in the accident, and his family and a fel-
Grange Insurance Co. of Michigan. Tried before: Jury Attorney for defendant: low employee testified that his speech be-
On Dec. 19, 2009, Leon Lucas, 71, was Name of judge: Colleen O’Brien Robert Huebner gan to change the week after the acci-
involved in an auto accident. The at-fault dent, leading him to the MRI that
Demand: $350,000 Key to winning: Blowing up and revealed an acute hematoma. The treat-
driver had $20,000 limits, which were effectively utilizing certain views of the
paid pre-suit with the consent of Grange, Highest offer: $150,000 ing neurologists admitted that the trauma
brain MRI during the treating physicians’
the Lucases’ UIM carrier. from the accident more likely than not
Verdict amount: $500,000 testimony, clearly revealing a hematoma
The ER records from the day of the ac- caused the brain bleed.
cident did not evidence any head trauma Defendant’s pretrial motion in limine to
or injury, but Leon Lucas returned to Lucas returned to work full time as a not start to receive cognitive therapy preclude revealing the UIM policy limits
the ER a week later complaining of in- security guard at a local college. Six until nine months after the diagnosis. of $500,000 was denied. The judge ruled,
creasing headache and speech difficul- months after the accident, he had a Both neurologists testified that a portion in essence, that the action was for breach
ties. An MRI revealed a left frontal lobe seizure at home, and was put on lifelong of Lucas’ brain tissue had died (en- of the UIM contract, and the contract pro-
hematoma, which was treated conserva- anti-seizure medication, but he did not cephalomalacia), and the neuropsych- visions, including limits, were relevant
tively. Lucas was discharged after three miss any work. ologist testified that Lucas had various and admissible.
days and had conservative therapy for Lucas had a neuropsych exam a cognitive deficits. Post-trial, the $500,000 verdict was re-
three months, during which time he did year after the accident, and although Defendant contended that the brain duced by the at-fault driver’s $20,000.
not work or drive. cognitive deficits were diagnosed, he did bleed was not caused by the accident be- Grange has paid the judgment.
tion, he added, they could get it with an in-
Drug immunity Senate Bill 936 quiry conducted by a legislative committee.
Haron calculated that Michigan makes
Continued from page 3 1.6 percent of the total Medicaid drug ex-
every year, money that should be put back This would amend 1961 PA 236 penditures in the country.
into Medicaid. And she said that if the state by amending section 2946 (MCL When states recover money from a drug
is going to continue to provide drug makers 600.2946) by removing the FDA maker, the federal government receives
that level of immunity, lawmakers should at defense language: “In a product about half of that because it pays approx-
least have a full understanding of the con- liability action against a imately half of Medicaid, he added.
sequences of the law. manufacturer or seller, a “Based on that, Michigan would be able
Lipton supports a repeal of the immu- product that is a drug is not to recover about $25 million per year,”
nity law. defective or unreasonably Haron said.
Senate Bill 936, a bill that would elimi- dangerous, and the But Bob Dorigo Jones, president of Novi-
nate the FDA defense, was introduced in manufacturer or seller is not based M-LAW (Michigan Lawsuit Abuse
February (see box at right). Sen. Roger liable, if the drug was approved Watch), said he’s uneasy with the idea of
Kahn, R-Saginaw Twp., would like that for safety and efficacy by the weakening the FDA defense in any way.
bill to do what other similar bills have United States food and drug “If companies have to continuously look
done before it: die in committee. administration, and the drug over their shoulders at the threat of litiga-
Kahn is a cardiologist who said he’s and its labeling were in tion, it hurts everybody else,” Jones said.
seen firsthand how beneficial new drugs compliance with the United His problem with the reporting re-
States food and drug quirement is that it would put public at-
have been in his patients’ lives. He wants
administration’s approval at the tention on “a small part of the greater
Michigan to be a beacon to other states
time the drug left the control of story, which isn’t being told. It doesn’t tell
who want to pass immunity laws.
the manufacturer or seller. …” anything about the number of people who
And some have done just that. A dozen
other states have weaker versions of Michi- are suffering because of litigation, who
“[Shay Blair v. Genetech Inc., XOMA
gan’s law. They either bar punitive dam- aren’t involved in any way in litigation. A
LLC, et al.] got dismissed at District
ages in suits against manufacturers of repeal the FDA defense. But if the Legisla- lot of drugs never make it to market in the
drugs that are FDA-approved, or they have ture can’t do that, the very least it should do U.S. because of the threat of litigation.”
a rebuttable presumption that FDA warn- Court, which we expected because of is to clarify the difference between Medicaid For example, he said he knew the father
ings are adequate to protect consumers. Michigan’s immunity law,” she said. “It’s fraud and product liability, he said. of a 10-year-old girl with encephalitis. The
Repealing Michigan’s law, which Kahn fully briefed and ready for appeal. We are “About $4 billion was recovered from drug girl needed a brain shunt to survive.
said is a leader in the country, would be an arguing that Michigan’s drug immunity companies last year for fraud. That means “There were at one time 14 manufactur-
“attempt to solve a problem that doesn’t ex- defense is an affirmative defense. Michigan is not sharing in that,” Haron ers in the U.S. But that had whittled down to
ist. There is no immunity for drug makers in “Our allegation was that they were not said. “This isn’t about individuals or even two because the product was made with sil-
this state. You can sue for failure to produce in compliance with the FDA when the the state getting money from a company. icone, and all the litigation, or threat of liti-
the drugs to an appropriate standard, if you drug left the manufacturer.”
concealed data [from the FDA], or if there is But the drug did get approved by the
new data and you didn’t report it.” FDA, though it was later withdrawn from
Despite the argument that the case the market, and Kahn said that “[t]here’s a
“About $4 billion was recovered from drug companies last year
against Vioxx was based on alleged fraud, basic argument that the FDA is exhaustive for fraud. That means Michigan is not sharing in that. This isn’t
the Court of Appeals determined that the and that should be recognized by the courts.”
case was barred by MCL 600.2946 be- All the same, there’s simply no reason about individuals or even the state getting money from a
cause it “exempts drug companies from to keep the state from joining lawsuits to
product liability suits regarding FDA-ap- recover money that was lost to fraud. company. … Michigan paid these companies this money that
Even though Kahn is a staunch propo-
proved drugs. … If the plain language of
the statute results in an outcome that the nent of the FDA defense, he said that he
was taken fraudulently. We should get it back.”
Legislature now deems improper, it is for also disagreed with the Court of Appeals’ — David Haron, Frank Haron Weiner PLC
the Legislature, not this Court, to narrow Vioxx decision.
the application of the statute by amending “The spirit of the exceptions to the FDA
or redrafting its terms.” defense should include fraud,” he said. There is no windfall or lottery. Michigan gation, was driving them out of business,”
“There’s a difference between the letter of paid these companies this money that was Jones said. “The father said, ‘I know if some-
‘The FDA is exhaustive’ the law and the spirit of the law. This taken fraudulently. We should get it back.” thing doesn’t happen, my daughter will lose
Alyson , of Rochester-based Oliver Law seems to be one of those differences.” this brain shunt that she needs to live.’”
Group, disagrees with Kahn’s assessment Kahn said he would like to hear a full Threat of litigation Even if the reporting requirement has
of how Michigan’s law is applied in the debate of Lipton’s budget requirement, But still, Haron thinks that the Lipton support, he adds that the Senate bill
real world of product liability litigation. and that he would “keep an open mind.” amendment to require the attorney general would have little chance of survival.
She is working on several cases in David Haron, of Frank Haron Weiner to report to the Legislature is “meaning- “If you look at it from a cynical point of
which she argues that the manufacturer PLC in Troy, also disagreed with the Court less. That’s why it’s got bipartisan support.” view, it’s an easy issue to win votes,” Jones
of Raptiva concealed risks associated with of Appeals’ decision in the Vioxx case. Haron said the only purpose of such a said. “We see this every couple of years.
the drug, failed to warn of risks, and “It was not a products liability case,” requirement would be to “embarrass some And this year is no exception.”
breached the implied and express war- Haron said. “It was about Medicaid fraud people and point out that our laws protect If you would like to comment on this story, please
ranty when they made and sold the drug under the Medical False Claims Act.” fraud? We already know that.” contact Carol Lundberg at (248) 865-3105 or
from 2003 until 2009. Haron supports the Senate bill that would If legislators really wanted that informa- email@example.com.