Soapbox

Liability Risks and Litigation Defenses for COVID-19 Tests: Potential Claims and Defenses

By Jordan Lipp
August 19, 2020


• Categories: 03-Manufacturing Execution, 04-Product Design & Development, 05-Quality/Regulatory, Business Analysis, Market Access, Soapbox

With increased concerns about the reliability of some COVID-19 tests,¹ as well as the FDA’s revocation of its emergency use authorization involving some COVID-19 tests (i.e., Chembio Diagnostic System’s antibody test), the liability risks and litigation defenses related to COVID-19 tests is an important issue. This article discusses the litigation defenses and risks for manufacturers of these COVID-19 tests.

In assessing these issues, part one of this two-part series will begin by addressing the types of claims that are typically brought against the manufacturers of diagnostic test kits. Next, this article will review the first and primary defense to COVID-19 test kit cases—the Public Readiness and Emergency Preparedness Act (PREP Act) immunity. If PREP Act immunity is not enforced, the next question is what are the other defenses and approaches manufacturers can take in defending their products in litigation, which will be the last item addressed in part one of this series.

Part two of this two-part series will examine the myriad of previous cases involving allegations of defective diagnostic tests in order to shed light on how product liability lawsuits against COVID-19 tests may play out.

Watch the MedTech Intelligence complimentary on-demand webinar about Emergency Use AuthorizationPotential Claims

In order to understand the litigation and insurance risks of COVID-19 tests, it is critical to first examine and understand the types of claims that diagnostic test manufacturers tend to face in litigation.

Historically, product liability and similar claims involving diagnostic test products tend to fall into three broad categories: (i) False positive results, (ii) false negative results, and (iii) dangers from the test itself. Let’s quickly examine each of these three in turn.

False positive cases involve the situation in which a patient is tested for a disease or condition, and the test reports that the patient has a disease that he or she does not. Claims for false positive tests tend to assert damages for unnecessary and detrimental medical care to treat an illness that the patient did not have.

False negative cases address when a patient is tested for a disease or condition, and the test fails to report that he or she has the disease, in spite of the patient having it. Claims for false negative tests tend to claim as damages the harm caused by the failure to treat the patient for the disease and associated harms.

Finally, a surprisingly large number of diagnostic test cases involve the test itself allegedly harming the patient. These types of cases can involve anything from allegations that the contrast agent used in testing caused paralysis, to X-ray machines falling on people, to contaminated bronchoscopes.^2,3,4 As the likelihood of COVID-19 tests themselves harming patients is low, cases involving such harms will not be addressed in this two-part series, though it should be remembered that there are always possibilities of harm from the test itself, such as contaminated swabs.

Although it’s easy to think of all of these cases just in terms of product liability claims, that isn’t necessarily always the case. In diagnostic test cases, if the patient/plaintiff has real damages, the lawsuits are usually brought as primarily product liability cases, sometimes with associated claims of fraud, consumer protection, and the like tagged on. In the diagnostic test cases where the patient/plaintiff cannot point to real damages, the claims in the lawsuits are often reversed, with fraud and consumer protection claims being the primary claims, and product liability claims sometimes added as an afterthought.

The First and Foremost Defense – PREP Act Immunity

In any lawsuit involving COVID-19 tests, the manufacturer will and should immediately challenge the lawsuit based upon the PREP Act. COVID-19 test kits are authorized under the FDA’s Emergency Use Authorization (EUA) Authority. This EUA authority is available if the Secretary of HHS declares a public health emergency and the FDA authorizes the use of a non-approved/ non-cleared product, or authorizes an off-label use of an otherwise approved / cleared product, to combat the public health emergency.⁵

As the test kits are being used under the FDA’s EUA authority, this puts them squarely within the purview of the PREP Act.⁶ The PREP Act provides nearly blanket immunity under certain circumstances for manufacturers, distributors, and administrators of certain drugs, medical devices, and biologics meant to counteract an epidemic or pandemic.⁷ This immunity extends to medical devices that have been authorized by the FDA under its Emergency Use Authorization (EUA) authority.⁸

The PREP Act itself only provides one exception to its immunity, for willful misconduct.9 The PREP Act defines willful misconduct as an act or omission that is taken, among other things:

• Intentionally to achieve a wrongful purpose;
• Knowingly without legal or factual justification; and
• In disregard of a known or obvious risk.

Beyond this high standard, the PREP Act sets forth a number of additional hurdles to any plaintiff trying to bring a claim for willful misconduct.

It is likely that the PREP Act will largely provide immunity for COVID-19 test manufacturers. However, there is scant case law on the PREP Act, and creative plaintiffs may try to circumvent the PREP Act in any number of ways. For example, they may argue that the test kit manufacturer’s conduct was willful and wanton, that the tests were not distributed under the authorization of the authority having jurisdiction, or that if the EUA is revoked for the test kit that it loses PREP Act immunity. These arguments will be challenging for the plaintiffs, but assuming some lawsuits survive a PREP Act challenge, the next question is what other defenses will the test manufacturer be able to assert.

The Other Defenses

Assuming the lawsuit survives a PREP Act challenge, the next question naturally becomes how else can device companies challenge the lawsuits. As COVID-19 tests have not gone through the PMA process (i.e., the premarket approval process) with the FDA, they will not have the same strong preemption defense that many Class III products have.10 Nevertheless, that is not to say that there are no other defenses.

In order to understand these defenses, let us start with the basics of product liability law. The “triumvirate” of product liability claims are (i) manufacturing defect, (ii) design defect, and (iii) failure to warn or instruct.¹¹ To the extent that product liability lawsuits are brought against COVID-19 test manufacturers, there will likely be a combination of some or all of these claims. For example, the claims may be that the test was built in a shoddy manner (making it fail), that the test was designed poorly (making it fail), or that it contained improper instructions so the lab misread the results. While the latter claim may seem a bit more unusual, failure to warn or instruct claims are certainly not unheard of in cases involving diagnostic equipment.¹²

To bring claims against COVID-19 test manufacturers, plaintiffs will have to prove one or more of these claims. That means, among other things, the plaintiff must prove that the test kit was “in a defective condition unreasonably dangerous to the user.”¹³ This provides plenty of arguments for the manufacturer that the plaintiff cannot meet this requirement.

Similarly, the plaintiff must prove that the alleged defect in the test kit caused his or her injury—something that can be tricky in the infectious disease context.

Moreover, proof of defect will require expert support in virtually all American courts, and the proof of causation will require expert support in most American courts. As such, the plaintiff will face significant hurdles in getting their case to the jury.

Assuming, nevertheless, that the lawsuit proceeds to a jury trial, jurors may well be sympathetic to companies who worked hard to rush a test to market to try to stem the COVID-19 pandemic. To the extent mistakes were made, depending upon the facts, many jurors will understand that mistakes may have been inevitable when companies were struggling to produce tests as quickly as possible to combat a novel pandemic. However, bad company documents or witnesses, juror sympathy for plaintiffs, and juror corporate animus creates significant risks of unfavorable verdicts.

In part two of this two-part series, we will look at the lessons from past lawsuits against manufacturers of diagnostic testing equipment.

References

1. E.g., Bastos, et al., Diagnostic accuracy of serological tests for covid-19: systematic review and meta-analysis, BMJ 2020;370:m2516.
2. E.g., Savina v. Sterling Drug, Inc., 795 P.2d 915 (Kan. 1990)
3. E.g., Ehlers v. Siemens Med. Sols., USA, Inc., 251 F.R.D. 378 (D. Minn. 2008)
4. Majette v. Olympus Am. Inc., 2007 WL 2332317 (D. Md. Aug. 8, 2007)
5. 21 U.S.C. § 360bbb-3
6. 42 U.S.C. § 247d-6d and e. However, under a new FDA program, some COVID-19 test kits no longer need an EUA authorization, and tests that do not obtain an EUA may well not have any PREP Act protection. Retrieved from: https://www.hhs.gov/coronavirus/testing/recission-guidances-informal-issuances-premarket-review-lab-tests/index.html
7. 42 U.S.C. § 247d-6d and 6e. For an overview of the PREP Act, see the following article co-authored by the author of this article: https://www.accdocket.com/articles/overview-prep-act-liability-covid-19.cfm
8. 42 U.S.C. § 247d-6d(i)(1)(C)
9. 42 U.S.C. § 247d-6d(c), (d), (e)
10.  21 U.S.C. § 360k; Riegel v. Medtronic, Inc., 552 U.S. 312 (2008); but cf. R.F. v. Abbott Labs., 745 A.2d 1174 (N.J. 2000) (applying implied preemption for HIV test).
11. Bruesewitz v. Wyeth LLC, 131 S. Ct. 1068, 1076 (2011).
12. E.g., McGee v. Corometrics Med. Sys., Inc., 487 So. 2d 886 (Ala. 1986).
13. Restatement (Second) of Torts § 402A(1) (1965).