Day on Torts

August 30, 2006

Summary Judgment for Drug Manufacturer Reversed

Hmm. Summary judgment for a drug manufacturer is reversed? In the 21st Century? In Federal Court? Now, that is something worth writing about.

In McNeil v. Wyeth, No. 05-10509 (August 22, 2006) the Fifth Circuit Court of Appeals faced an appeal after summary judgment was granted in favor of the manufacturer of Reglan, a drug used to treat gastroesophageal reflux disease (GERD). The plaintiff had taken the prescription drug for multiple months over the 12 weeks approved by the FDA; each time the drug was ordered by a physician. McNeil developed Reglan-induced tardive dyskinesia in addition to Reglan-induced extrapyramidal symptoms (EPS).

She sued, alleging that "Wyeth had failed adequately to warn physicians and consumers of the increased risk of tardive dyskinesia that accompanies long-term use of Reglan. McNeil argued that Wyeth’s failure to warn rendered the inherently unsafe product unreasonably dangerous. Further, McNeil alleged that the Reglan label was misleading as to the risk of tardive dyskinesia and failed adequately to warn about the increase in risk associated with exposure to the drug for more than twelve weeks." The lower court found the label adequate and dismissed the case.

August 29, 2006

Bad Faith Law Clarified

by The Law Offices of John Day, P.C.

The Tennessee Supreme Court has issued an extremely important decision in the field of bad faith law.

In Johnson v. Tennessee Farmers Mutual Insurance Company, No. E2004-00250-SC-R11-CV (August 28, 2006), Justice Holder, writing for an unanimous court, reversed the Court of Appeals and upheld a bad faith verdict against Tennessee Farmers.

Johnson sued his own insurer after he got hit for an excess judgment in an auto case. A 2-1 decision of the Court of Appeals took away a plaintiff’s verdict of $279,430.92 against Tennessee Farmers, saying that the trial judge had not charged the jury correctly on the law of bad faith. Judge Lee dissented, saying the trial judge had gotten it right.

August 29, 2006

Dr. Frist’s Medical License

by The Law Offices of John Day, P.C.

Dr. Bill Frist, who serves both as Majority Leader of the United States Senate and Founder and CEO of APCDBAV (Association of Physicians Capable of Diagnosing Brain Activity Via Videotape), applied for renewal of his medical license in Tennessee, pledging that he met the CME requirements of the State.

This article suggests that he did not.

The excuse? "’As a result of a change in Tennessee’s regulations several years after Dr. Frist came to the Senate, he may be required to complete additional continuing medical education hours,’ spokesman Matt Lehigh said in a statement. ‘A representative of the Tennessee Board of Medical Examiners has been contacted, and Dr. Frist will meet every requirement of the Board.’"

August 28, 2006

Blue Chipper – Parental Liability for Acts of Child

by The Law Offices of John Day, P.C.

The case: Lavin v. Jordon, 16 S.W.3d 362 (Tenn. 2000). Author: Justice William M. Barker.

Why it is a Blue Chipper: Lavin v. Jordan is the leading case on the liability of parents for the willful or malicious tortious acts of their children. It is important to note, however, that despite some rather broad language in Lavin the Eastern Section of the Tennessee Court of Appeals has recently held that neither Lavin nor the statute referenced below are applicable in cases where the child negligently causes injury or death.

The bottom line:

August 26, 2006

Seminars by Justice Programs

by The Law Offices of John Day, P.C.

Former Justice Penny White, former Judge Joe Riley and I are holding our civil trial practice seminars again this Fall.

We started Justice Programs three years ago with the idea that, with increasing specialization in the Bar, a large number of people would prefer to attend an "annual review" program that was focused on the law of interest to civil trial lawyers. Attendance at the seminars have exceeded our expectations and have grown by leaps and bounds each year. We believe that this year’s program will be even better than the one we offered last year and registrations are already flowing into our headquarters in Ripley.

Here is our schedule for 2006:

August 25, 2006

Taxability of Damages

by The Law Offices of John Day, P.C.

Damage paid for personal injury claims are not taxable, right? Wrong. Damages paid for personal injury claims "“on account of personal physical injuries or physical sickness” are not taxable. 26 U.S.C. § 104(a)(2). Damages paid for purely emotional injuries are taxable, at least in the opinion of the IRS.

Now, along comes Murphy v. Internal Revenue Service, No. 05-5139 (D.C. Cir. August 22, 2006). Murphy received "damages for emotional distress and loss of reputation she was awarded in an adminstrative action she brought against her former employer." She was asked to, and did, pay taxes on the award, and then sued to get her tax payments back. She tried to argue that the payments fell within the exclusion of § 104(a)(2), but that failed. However, the Court held that "§ 104(a)(2) is unconstitutional as applied to her award because compensation for a non-physical personal injury is not income under the Sixteenth Amendment if, as here, it is unrelated to lost wages or earnings."

The Court said "it is clear from the record that the damages were awarded to make Murphy emotionally and reputationally “whole” and not to compensate her for lost wages or taxable earnings of any kind. The emotional well-being and good reputation she enjoyed before they were diminished by her former employer were not taxable as income. Under this analysis, therefore, the compensation she received in lieu of what she lost cannot be considered income and, hence, it would appear the Sixteenth Amendment does not empower the Congress to tax her award." It went on to say that "every indication is that damages received solely in compensation for a personal injury are not income within the meaning of that term in the Sixteenth Amendment. First, as compensation for the loss of a personal attribute, such as wellbeing or a good reputation, the damages are not received in lieu of income. Second, the framers of the Sixteenth Amendment would not have understood compensation for a personal injury — including a nonphysical injury — to be income. Therefore, we hold § 104(a)(2) unconstitutional insofar as it permits the taxation of an award of damages for mental distress and loss of reputation."

August 24, 2006

Tissue Recalled – Donor Referral Services

by The Law Offices of John Day, P.C.

Another day, another article about problems in the human tissue industry. This time it is Donor Referral Services of Raleigh, N.C., a company run by a man named Philip Guyett.

This North Carolina firm in the business of body part brokering allegedly used an unsterile embalming room to get usable tissue. The number of people who received the tissue is unknown.

No lawsuits appear to have been filed concerning the problem and, in fact, it is unknown whether any patients have been injured by the tissue.

August 23, 2006

Tennessee Supreme Court Accepts Statute of Limitations Case

by The Law Offices of John Day, P.C.

The statute of limitations is tolled when the plaintiff is of unsound mind. Tenn. Code Ann. § 28-1-106. Does the fact that a Durable Power of Attorney (executed before the incompetency) is in existence trump the tolling statute and require the attorney-in-fact to take action within the original statute?

The Tennessee Court of Appeals said "no" in Sullivan v. Chattanooga Medical Investors, L.P., No. M2004-02264-COA-R3-CV – (January 26, 2006). See the original opinion here.

Judge Susano put the issue this way: "Is the tolling effect of Tenn. Code Ann. § 28-1-106 implicated when an individual, while competent, grants another a durable power of attorney, including the power to act for the grantor with respect to “claims and litigation”? The crux of both the defendant’s argument and the trial court’s holding in opposition to the application of § 28-1-106 is that, by granting a durable power of attorney, the deceased removed himself and the plaintiff from the ambit and protection of § 28-1-106."

August 22, 2006

2006 Changes in Medical Malpractice Reporting Law

by The Law Offices of John Day, P.C.

From a recent press release issued by the Tennessee Dept. of Commerce and Insurance:

"Public Chapter 744, effective May 23, 2006, contains several important changes to the Medical Malpractice Reporting Law of Tennessee, (Public Chapter 902, adopted in 2004, and codified at Tenn. Code Ann. § 56-54-101). For the first time, it requires “reporting entities” (insurance companies, uninsured health care facilities and professionals) to include the damages and defense expenses incurred from the inception date of the medical malpractice claim until the end of the reporting year in its annual report to the Department of Commerce & Insurance (the “Department”). This change will enable the Department to accurately report on all of the costs to date incurred by reporting entities in its annual report to the General Assembly, rather than just those costs incurred during the reporting calendar year. The law requires reporting entities to re-file 2005 reports by July 1, 2006 to reflect these inception-to-date damages and costs, and also extends the deadline for the Department to report to the General Assembly from September 1 to November 1 of each year.

The legislation places requirements on counsel for claimants to submit their information on medical malpractice fee arrangements directly to the Department by April 1 of each year, beginning in 2007. Counsel for claimants are also included in the definition of “reporting entities” over which the Department has civil penalty authority to levy a fine of $100 a day for failure to report. The law now requires claimant’s counsel to report the portion of settlement or judgment received in the reporting calendar year. Similarly, all reporting entities must now list the name of each attorney representing claimants in its annual report in order to provide the Department with additional enforcement information. All settlement and judgment information submitted to the Department will continue to be held confidential, and reported only in aggregate form.

August 21, 2006

Legal Links

by The Law Offices of John Day, P.C.

Here is an interesting site that provides a good number of links of use to tort lawyers (and others). The site is published by the Philadelphia Association of Paralegals and has more than 100 links.

For instance, Omni Medical Search is a site that I was unfamiliar with that is referenced by the PAP. It looks great.

Enjoy.