Becoming Masters of the Universe: The How To's of Multi-Jurisdictional Product Liability Litigation

By Hughes, Annette | Defense Counsel Journal, October 2014 | Go to article overview

Becoming Masters of the Universe: The How To's of Multi-Jurisdictional Product Liability Litigation


Hughes, Annette, Defense Counsel Journal


IN an increasingly globalized and connected world, purely "locally made" products are becoming increasingly rare. These days, most products are developed in a synergetic process where component parts are sourced from a variety of countries, and products are assembled or manufactured elsewhere and sold around the world. This presents a web of unique legal, practical and strategic challenges for product liability litigation, as the potential harm caused by a defective product is not quarantined within convenient jurisdictional boundaries. This brings a variety of risks to potential defendants as parties, courts and rules (of law and process) seek to overcome traditional jurisdictional constraints and effectively and fairly manage resulting litigation.

In any given matter, the question of how defendants can best address the challenges of multi-jurisdictional product liability proceedings requires a nuanced understanding of the relevant laws in each jurisdiction in play, as well as an appreciation for the ways in which those laws may be implemented (or not) and may complement or clash with one another. This article explores some of these issues, with a focus on practical measures which can be taken to prevent, prepare for and conduct international multi-jurisdictional product liability litigation. These measures provide a framework for minimizing the financial, reputational and other risks facing companies that are exposed to large-scale, international litigation, which can be tailored depending on the various jurisdictions in play at the relevant time.

I. Duplicative Proceedings

A. Risks Associated with Duplicative Proceedings

There is a large scope for duplicity of proceedings in multi-jurisdictional litigation. As US District Court judge David F. Levi, Chair of the Advisory Committee on Civil Rules, recently explained:

overlapping and duplicating class actions in federal and state court create serious problems that: (a) threaten the resolution and setdement of such actions on terms that are fair to class members, (b) defeat appropriate judicial supervision, (c) waste judicial resources, (d) lead to forum shopping, (e) burden litigants with the expenses and burdens of multiple litigation of the same issues, and (f) place conscientious counsel at a potential disadvantage.1

This problem also exists in Australia and Canada, where different state and federal jurisdictions have their own unique procedural requirements,2 * as well as within Europe.1

All this said, the relatively superficial differences that exist within the various courts and frameworks of the United States, Canada or Australia, or within Europe or the E.U. arguably pale in comparison to fundamental divergences between the representative regimes in the United States and, for example, France. While globalization has mitigated distances between states and led to a sharing of legal principles between nations, this trend has not manifested in any sort of harmonized legal procedure. Corporate defendants can be subject to perpetual proceedings being launched around the world in respect of a single product.

The Vioxx litigation provides a good clear example of this. Merck Sharpe & Dohme (Merck) was sued throughout the United States and Canada over the antiinflammatory drug Vioxx, and also faced a Federal Court claim in Australia. Because of jurisdictional differences within the United States and Canada, there were 16 class actions filed against Merck in the United States in relation to Vioxx, and separate proceedings brought in the Canadian provincial courts of Ontario and Saskatchewan.4

Unsurprisingly, this multiplicity of proceedings led to Merck incurring con1 siderable unnecessary expense, and to add uncertainty, Merck was variously successful and unsuccessful as each piece of litigation played out (in the United States alone, Merck successfully defended 11 of the 16 class actions).

This also meant that in the United States alone, Merck was forced to create a $950 million settlement fund in light of the constant stream of litigation and difficulties with predicting not only outcomes, but even interlocutory procedural developments (because of different courts approaching issues differently). …

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