Court of Appeal Stands Product Liability Law On Head?

CalBizLit left early on Friday to go to Los Angeles for the Cal vs. USC debacle, and until today,  missed the Court of Appeal's decision in Conte v. Wyeth (November 7, 2008) ___Cal.App.4th___. 

Here's the story:  Wyeth develops and brings to market the reflux medication Reglan.  According to Plaintiff, the FDA-approved labeling and PDR submission fails to adequately warn of the risks of serious side-effects from taking the medication more than the recommended twelve weeks.  For four years, the Plaintiff took not Reglan, but its generic bioequivalent, metoclopramide, which was not manufactured by, distributed by, or in any other way connected with Wyeth.  She developed tardive dyskinesia, a debilitating and incurable neurological disorder, allegedly as a result  of taking the non-Wyeth generic drug for longer than the prescribed twelve weeks.

The trial court granted summary judgment in favor of Wyeth.  After all, Wyeth owed Plaintiff no legal duty, right?  Wrong!  The Court of Appeal reversed.  The reasoning:  If this were a strict product liability case, Plaintiff could not proceed against Wyeth because she never ingested its product.  But this was a negligent misrepresentation case.  And under traditional, Palsgraf-based principles, legal duty is determined on the basis of foreseeability of harm.  Was it foreseeable that Plaintiff's doctor would read Wyeth's PDR warning before either (a) prescribing the generic equivalent or (b) prescribing the Wyeth drug only to have the pharmacist substitute the generic, as generally allowed in California and many states? 

"It is . . . highly likely that a prescription for Reglan written in reliance on Wyeth’s product information will be filled with generic metoclopramide. And, because by law the generic and name-brand versions of drugs are biologically equivalent . . ., it is also eminently foreseeable that a physician might prescribe generic metoclopramide in reliance on Wyeth’s representations about Reglan. In this context, we have no difficulty concluding that Wyeth should reasonably perceive that there could be injurious reliance on its product information by a patient taking generic metoclopramide."

In their excellent and very popular Drug and Device Law, Beck and Hermann view this through a fairly typical "Californians are all crazies" lens, opining that the decision "effectively stands product liability law on its head."  As a matter of legal interpretation, I can't agree;  if we argue that the courts should interpret existing law, we have to take the good with the bad, and foreseeability has been the basis for establishing legal duty in this, and most states, for a long time. 

On the other hand, the outcome is preposterous:  Wyeth spends the money to develop the drug, the generic manufacturers get to profit from its development, and only Wyeth is liable when things go south.