Cal Biz Lit

Medical Monitoring in California

Monday's Wall Street Journal Law Blog discusses the Mattel recall of toys from China containing lead paint, and muses on the potential of parents suing for "medical monitoring" damages on behalf of children who were exposed to lead paint from toys but who have no injury.  The same subject is covered more extensively in the Wall Street Journal's on line (paid subs. req'd) and paper versions.  LawBlog quotes "legal experts" in support of the contention that "[a]bout 15 states, including California and Illinois, would likely allow such lawsuits."

Well, wait a minute.  In California, the governing authority is Potter v. Firestone Tire & Rubber Co. (1993) 6 Cal.4th 965 , 25 Cal.Rptr.2d 550; 863 P.2d 795, and the neither the holding nor its effect are quite that simple.  As defined by the Supreme Court, "a claim for medical monitoring seeks to recover the cost of future periodic medical examinations intended to facilitate early detection and treatment of disease caused by a plaintiff's exposure to toxic substances." 

The Court held as follows: 

the cost of medical monitoring is a compensable item of damages where the proofs demonstrate, through reliable medical expert testimony, that the need for future monitoring is a reasonably certain consequence of a plaintiff's toxic exposure and that the recommended monitoring is reasonable. In determining the reasonableness and necessity of monitoring, the following factors are relevant: (1) the significance and extent of the plaintiff's exposure to chemicals; (2) the toxicity of the chemicals; (3) the relative increase in the chance of onset of disease in the exposed plaintiff as a result of the exposure, when compared to (a) the plaintiff's chances of developing the disease had he or she not been exposed, and (b) the chances of the members of the public at large of developing the disease; (4) the seriousness of the disease for which the plaintiff is at risk; and (5) the clinical value of early detection and diagnosis. Under this holding, it is for the trier of fact to decide, on the basis of competent medical testimony, whether and to what extent the particular plaintiff's exposure to toxic chemicals in a given situation justifies future periodic medical monitoring.

We've had this rule in California for more than ten years now, and it hasn't resulted in a flood gate of litigation for plaintiffs seeking medical monitoring damages without proof of injury.  Why not?  QED:  What might the cost of medical monitoring be in a case involving no provable damages and exposure to lead paint in toys?  $5,000?  $10,000?  Maybe $20,000 tops for testing for lead burden and intelligence tests?  How many plaintiff attorneys file $20,000 toxic tort cases?  Not many -- like none.  And the California Supreme Court has stood quite firm in rejecting class actions in personal injury cases (See: Lockheed Martin Corp. v. Superior Court (Carrillo) (2003) 29 Cal.4th 1096 , 131 Cal.Rptr.2d 1; 63 P.3d 913, so these cases would have to proceed one at a time.  The result is that when we see a claim for medical monitoring -- and we see plenty of them -- it's just about always an appendage to a case involving a claim of real injury or disease, not a stand-alone claim.  Mattel has plenty of things to worry about right now, but an onslaught of California medical monitoring claims is likely not one of them.

August 22 update:  Well, that didn't take long.  Today's Recorder, the SF Bay Area legal paper and part of ALM Legal Division reports "Class action filed in L.A. over Mattel toys."  And the same story appears in Law.Com and  The Legal Intelligencer.

According to the complaint, "the potential class is not seeking any damages for personal injury,"  no doubt to try and circumvent California's prohibition of class treatment for personal injury cases.  But I still say this is a non-starter.

Choice of Law in Contract Cases

I've been on hiatus from blogging for a few weeks owing to (a) crush of work, followed by (b) vacation at the beach with my family, including my brand new granddaughter.

But I'm back now, spending this beautiful California Sunday taking a look at what's new in the world of litigation and appeals in the Golden State.

One new Court of Appeal decision stands out, dealing with conflicts of laws.  This is a subject that gave me a headache thirty plus years ago in law school, and not much has changed in that regard since then.  In most cases, and particularly in tort cases, California courts apply a fairly convoluted version of the "governmental interest test," about which I will say no more in order to avoid sending either readers, or myself, off to an afternoon nap.

But the new case has to do with contracts.  Specifically, it involves an insurance contract between a Texas based insured and a Texas based insurer.  The insured's oil and gas drilling activities in Beverly Hills supposedly caused personal injuries and death, and the insured was sued.

You probably won't be surprised to learn that California's law on an insurer's  duty to defend lawsuits is more pro-insured than the law in Texas.  So under California law, the insurer potentially had a duty to defend under California law, and not under Texas law. 

After a long discussion of all those governmental interest cases that pretty much lost my attention, the Court of Appeal held that they didn't matter because of California's Civil Code section 1646:  in a contract case, questions of interpretation are determined by the law of the place of performance.  An insurance policy is performed in the place where the risk exists.  So California law applies.

The Court seemed to feel that no previous court had squarely addressed this question in this context.  I didn't go back and check the Court's work, but I don't remember seeing anything directly on point.  The ruling goes well beyond insurance contracts, and seems to apply to just about any contract interpretation case involving a choice of law issue.  It is refreshing to have a court hold that a statute means what it says.

By the way, Civil Code section 1646.5 says the parties can draft around this "place of performance" rule in contracts involving more than $250,000 that aren't consumer, employment or service contracts.

Off-topic post -- RIP Max Roach

I rarely include off-topic posts.  But while I was gone, Max Roach passed at the age of 83, and the loss is a tremendous one.  As all jazz lovers know, he was the second to last of the great bop and post-bop drummers (Roy Haines is still alive), and, just as importantly, an innovator all his life. You can hear him at his most vibrant on  Clifford Brown and Max Roach (Emarcy/Universal, 1954), Thelonius Monk's Brilliant Corners (Riverside/Concord, 1956) and Money Jungle, in trio with Duke Ellington and Charles Mingus (Blue Note/EMI, 1962), which Ben Ratliffe of the NYT aptly called "an odd record of aggression and calm," but which I never get tired of.  You can also hear him with Clifford Brown here, and see him playing solo here.