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Pennsylvania Supreme Court & the Philadelphia Court of Common Pleas

Leadership in the Keystone State continues to turn a blind eye to the abuses occurring in the state’s civil justice system, particularly in the Philadelphia Court of Common Pleas and the Supreme Court of Pennsylvania. In perhaps the most disappointing decision in 2022, the Supreme Court of Pennsylvania eliminated the state’s venue rule for medical liability lawsuits. This decision will likely lead to a drastic increase in medical liability litigation in some of the most plaintiff-friendly courts in the state.

Nuclear verdicts are prevalent in Philadelphia and the City continues to be a hotspot for mass torts including asbestos litigation and pharmaceutical litigation due to the court’s propensity for high damage awards and low barriers to entry.

NUCLEAR VERDICTS HIT PENNSYLVANIA

Pennsylvania in Top 3 for Most Nuclear Verdicts

According to a 2022 U.S. Chamber study, Pennsylvania had 78 nuclear verdicts ($10 million or more) in personal injury and wrongful death cases between 2010 and 2019. These verdicts totaled over $11 billion in damages, with a median of $20 million. The state ranked third in per capita nuclear verdicts and fifth in total nuclear verdicts. Medical malpractice and product liability cases pose the most risk of an astronomical award. They accounted for more than 60 percent of nuclear verdicts. Not surprisingly, the Philadelphia Court of Common Pleas hosted more than half of the state’s nuclear verdicts.

Recent examples of nuclear verdicts include a $18.1 million award in a Philadelphia trip-and-fall case and a $19.7 million verdict, also in Philadelphia, in a medical liability case alleging that a physician failed to diagnose a lesion in a patient with a complex medical history. Businesses also remain on edge after earlier trials of pelvic mesh and Risperdal product liability cases resulted in a series of massive verdicts, including amounts as high as $120 million and $8 billion.

THE SUPREME COURT OF PENNSYLVANIA CONTINUES TO PROMOTE FORUM SHOPPING

The state high court’s loose application of venue rules has been well-chronicled in recent Judicial Hellholes® reports. Pennsylvania judges have made a habit of swinging open the courtroom doors to out-of-state plaintiffs. This policy benefits plaintiffs who live elsewhere but negatively impacts Pennsylvanians. It clogs courts, drains judicial resources, and drives businesses out of the state leading to job loss.

In addition, Pennsylvania courts have been slow to apply the U.S. Supreme Court’s 2017 ruling in Bristol- Myers Squibb v. Superior Court, which instructed state courts to dismiss cases that have no connection to the state. The Pennsylvania Supreme Court openly defied the U.S. Supreme Court in Hammons v. Ethicon, which was the state high court’s first opportunity to apply the BMS decision to claims brought by out-of-state plaintiffs in Pennsylvania courts.

Unfortunately, 2022 was more of the same from the Pennsylvania Supreme Court.

Elimination of Venue Rule for Medical Liability Cases

In August 2022, the Supreme Court of Pennsylvania eliminated constraints that have prevented lawyers from picking the most plaintiff-friendly jurisdiction for filing medical liability actions. At issue was a 2002 court rule that required plaintiffs’ lawyers to file medical liability lawsuits in the county where treatment occurred, not where a jury is expected to view the claim most favorably or return the largest award. The purpose was to reduce forum shopping and create a more fair and balanced playing field. Excessive medical liability drives up doctors’ insurance expenses, increases costs for patients, and reduces the public’s access to healthcare.

In light of the newly relaxed venue restrictions, attorneys are able to file suit for medical malpractice in jurisdictions not only where medical treatment took place, but also where the healthcare provider operates a hospital or office or where a physician lives, among other options. Of course, the state’s personal injury bar, through the Pennsylvania Association for Justice, supported the change. Plaintiffs will now flock to areas like Philadelphia, where juries are more willing to award higher verdicts in favor of plaintiffs.

A 2020 report by the General Assembly’s Legislative Budget and Finance Committee found that professional liability insurance rapidly increased in Pennsylvania in the years before the court restricted venue, peaked in 2007 (4 years after rule change) and has steadily decreased since. The Committee advised that eliminating the medical liability venue rule would have a destabilizing effect on the insurance market.

Another actuarial report issued in June 2022, prior to the court releasing its order, found that restricting venue helped shift medical malpractice suits from Philadelphia, a plaintiff-friendly venue, to neighboring, more appropriate venues that have a greater connection to the case. The report predicted that, if the venue rule was eliminated, urban areas were expected to see higher caseloads, both from neigh- boring county transfers and speculative cases seeking to take advantage of the higher probability of success in those courts. The report also predicted that hospital liability premiums would increase by 3.1% to 4.7% on average and that physicians stood to see a 4.9% to 7.2% increase in their insurance costs on average. This will likely have a greater impact on rural counties and could lead to an access-to-care crisis as doctors flee the area due to impending higher insurance costs. Unfortunately, the Supreme Court of Pennsylvania did not heed these warnings and still amended the venue rule to eliminate limitations on where medical liability cases may be filed.

In response to the court’s order, the Pennsylvania Legislature introduced a proposed constitutional amendment allowing it to establish venue rules, not the state supreme court. The bill faces an uphill battle and is currently pending in the Pennsylvania House of Representatives.

Plaintiffs’ Lawyer Exposes His Own Venue Shopping Game

Look no further than an April 2022 blog post by a Neuwirth firm attorney to see the importance and the impact of being able to forum shop in Pennsylvania. His post discusses how “venue shopping is a major compo- nent of my decision-making on cases.”

“The goal is always to find a way to place your case into Philadelphia if you are a plaintiff ’s lawyer. Simply put, the insurers will attach a higher value for the identical case in Philadelphia County than they will in Delaware County…. For example, a torn rotator cuff with surgery in Philadelphia may be worth $200,000, while the same injury may be valued at $75,000 in Chester County.”

“So, how have I created venue? Well, on several occasions, I have had my private investigator track a defendant from their home in the suburban counties to their offices in Philadelphia and then had the defendant served in person in Philadelphia County… And then, tada! You have venue that is really unassailable…”

CASES TO WATCH

In May 2022, the Supreme Court of Pennsylvania agreed to review a ruling that allowed a plaintiffs’ lawyer to file a case against a company in any county that the business derives revenue, regardless of the forum’s connection to the underlying case. In Hangey v. Husqvarna Professional Products, Inc., the defendant, a lawn equipment seller, derived only 0.005% of its total sales from

Philadelphia dealers. The trial court found that given the company’s negligible business in Philadelphia, the case should be tried in Bucks County, where the plaintiff had purchased the lawnmower that he alleged was defective. An appellate court reversed, ordering the case transferred back to Philadelphia, and allowing the case to proceed there against all defendants in the more liability-friendly forum.

SCOTUS to Weigh in on Positive Pennsylvania Decision

In April 2022, the U.S. Supreme Court agreed to consider whether the due process clause of the Fourteenth Amendment prohibits a state from requiring a business to consent to the jurisdiction of its courts, including in cases that lack a connection to the state. In Mallory v. Norfolk Southern Railway, a Virginia resident sued a Virginia-based railroad in Pennsylvania, relying purely on the railroad’s registration to do business in the state. A state statute, 42 Pa. C.S.A. § 5301, provides that by registering to do business in Pennsylvania, a company also consents to general jurisdiction in the state’s courts.

In early 2022, the Pennsylvania Supreme Court correctly affirmed the trial court’s decision finding that such a statutory scheme “does not constitute voluntary consent to general jurisdiction but, rather, compelled submission to general jurisdiction by legislative command,” and is unconstitutional under the due process clause.

 

“The goal is always to find a way to place your case into Philadelphia if you are a plaintiff’s lawyer. Simply put, the insurers will attach a higher value for the identical case in Philadelphia County than they will in Delaware County.”
– a Neuwirth firm attorney

UNREASONABLE ATTORNEYS' FEES

At the conclusion of 2021, the Pennsylvania Supreme Court delivered a Christmas present to the plaintiffs’ bar in Lorina v. Workers Compensation Appeal Board. The Court held that it is “mandatory” to shift fees to an employer when its petition for termination of benefits is denied under the Worker’s Compensation Act, even if plaintiff has chosen counsel that charges premium rates and bills excessive hours.

In that case, the plaintiff filed for worker’s compensation after a slip and fall injury on the job. The employer paid for back pain treatment for the employee for six months before filing a petition to terminate the benefits because the employee had recovered. The workers’ compensation judge denied the petition, finding the employee had yet to fully recover. Post-litigation, the plaintiff requested $14,050 in attorneys’ fees under the statute’s fee shifting provision, an amount the defendant argued was unreasonable. The Workers’ Compensation Appeal Board agreed, finding the plaintiff’s attorneys billed excessive hours for menial tasks in a relatively straightforward case. An appellate court affirmed, ruling that the plaintiff was not entitled to attorneys’ fees because his employer had a reasonable basis for its petition to end benefits. The Pennsylvania Supreme Court, however, reversed the lower court, finding that an employer ordinarily has a “mandatory” obligation to cover a prevailing plaintiff’s attorneys’ fees, and courts may award fees even when an employer had a reasonable basis for its decision.

 

CASES TO WATCH

Supreme Court to Decide Reasonableness of Punitive Damages

The Supreme Court of Pennsylvania is currently considering whether an amount of punitive damages that is nine times higher than a plaintiff’s compensatory damages is per se excessive and whether courts should apply a per-judgment or per-defendant calculation when determining the ratio.

In Bert v. Turk, a business sued a competitor, two of its subsidiaries and a former employee for poaching its sales force and client base. The jury awarded $250,000 in compensatory damages and $2.8 million in punitive damages. Defendants argued that the ratio exceeded U.S. Supreme Court precedent on punitive damages, which has stated that punitive damages that are more than nine times compensatory damages (9:1) are rarely constitutional and even a 4:1 ratio pushes the boundary of constitutionality in a typical case. The trial court found no constitutional problem because the judge calculated the ratios by dividing the punitive damages assessed to each defendant (rather than the total punitive award) by the total compensatory award, resulting in much lower ratios.

The Court now has an opportunity to establish “clearer guidelines” for punitive damage awards and to follow those established by the U.S. Supreme Court.

Evidence of Compliance with Safety Standards

The Supreme Court of Pennsylvania also is considering whether courts should admit evidence of industry and government standards in design defect cases. In Sullivan v. Werner, a carpenter sued a scaffold manufacturer, alleging a design defect after falling through the platform and injuring his back. The plaintiff’s lawyer sought to exclude evidence of government regulations and industry standards for scaffold design offered by the defendant, citing Pennsylvania case law. He argued that evidence of a product’s compliance with industry standards may be kept from the jury in a strict liability claim because the reasonableness of the manufacturer’s conduct is irrelevant.

As argued by amici for the scaffold manufacturer in their brief, these standards “promote uniformity in product design, reduce costs associated with development and testing, and ensure the product is safely designed and manufactured;” and therefore, businesses rely on such standards “to safely and cost-effectively” manufacture goods. The standards also are “widely recognized by the majority of courts as relevant to a design-defect claim.” Finally, Pennsylvania plaintiffs introduce evidence of noncompliance with such standards; thus, allowing defendants to present evidence of compliance with these standards “levels the currently uneven litigation playing field.”

BATTLE BREWING OVER SOVEREIGN IMMUNITY DAMAGE LIMITS

In June 2022, the Legislative Budget and Finance Committee issued a report recommending the state develop new sovereign immunity liability caps for catastrophic claims. Despite finding that the current limit of $250,000 ($1 million aggregate) sufficiently provides relief for over 99 percent of claims against the Commonwealth, the Committee recommended raising the amount of pain and suffering damages allowed for catastrophic claims.

The study relies heavily on anecdotal evidence and comparisons of past and present purchasing power, and in doing so, overlooks its own conclusions that the caps are on the whole sufficient.

MASS TORTS LITIGATION IN PHILADELPHIA COURT OF COMMON PLEAS

The Philadelphia Court of Common Pleas is the plaintiffs’ bar’s preferred jurisdiction for mass tort litigation. The court’s Complex Litigation Center, which hosts mass tort programs targeting pharmaceutical and medical device companies, is especially notorious.

PFAS

Just four days before voters went to the polls in November, the City of Philadelphia filed a lawsuit in the Philadelphia Court of Common Pleas against manufacturers of products containing trace amounts of poly- fluoroalkyl substances (“PFAS”), including 3M Co. and DuPont. The suit seeks to hold the manufacturers liable for contaminating local water sources with PFAS. The City hired Sher Edling, a notorious plaintiffs’ firm handling climate change litigation across the country, to assist with the case.

PFAS is a family of chemicals that are especially useful in suppressing fire and reducing flammability. Small amounts of PFAS chemicals are commonly found in manufacturing and consumer goods, as well as firefighting foam that was commonly used at military installations, airports and industrial sites. Although heavy doses of PFAS can be toxic to humans, the chemical is not harmful in small quantities. The EPA maintains a “heath advisory level” for the concentration of PFAS chemicals in water. The manufacturers substantially complied with the standards until this June when the EPA drastically reduced the targets to almost untraceable amounts. The lawsuit argues that the manufacturers should be held liable for exceeding the new target levels and examines the manufacturer’s conduct from as far back as the 1950s.

The City made typical product liability claims for design defect, failure to warn, and general negligence.

The City, however, also put forth expansive claims for public nuisance and trespass, a popular strategy for municipality plaintiffs in recent environmental and opioid litigation.

In response to the lawsuit, a representative for 3M Co. said that the company “acted responsibly in connection with products containing PFAS” and promised to “vigorously defend its record of environmental stewardship.”

Vena Cava Filters

Almost 1,800 claims are pending in the Complex Litigation Center alleging that Rex vena cava filters often fail and are ineffective. While the claims proceed to trial individually, they share a discovery mechanism for efficiency. In February 2022, a Pennsylvania appellate court upheld an order issued by the Philadelphia Court of Common Pleas requiring the company to provide financial records for the purpose of assessing punitive damages.

As pointed out by the defense, this decision implicates “highly private information of non-parties” that could wreak “havoc” on individuals not involved in the litigation. Among the private financial information requested was details about employees’ income and bonuses and how money was distributed. The discovery order requires the individual defendants “to disclose private financial information that far exceeds the narrow parameters” set by Pennsylvania law, which only allows “information concerning the wealth of a defendant” to be admitted. Individual plaintiffs also had not yet proven that they were entitled to punitive damages, but the order assumes that they are available.

Following the February ruling, the litigation halted as the manufacturer entered settlement negotiations with the plaintiffs. The parties completed settlement conferences in July and November, though terms of the settlement agreement were yet to be finalized as of the date of publication. The parties have, however, established a qualified settlement fund and appointed a fund administrator according to docket history.

Zantac

In 2022, the Complex Litigation Center initiated a new program for claims related to Zantac, an over-the- counter heartburn medication that was recalled by the FDA after finding that storage at high temperatures may result in an unacceptable level of an impurity in some instances over time. The program quickly caught the attention of plaintiffs’ attorneys; filing records show that 640 claims were pending in the CLC’s Zantac program as of October 15. Although a federal judge from the Southern District of Florida is already overseeing multi-district litigation for Zantac claims, many plaintiffs are opting to file Zantac claims in the Philadelphia Court of Common Pleas. They are choosing Philadelphia because it is an advantageous venue for a plaintiff to litigate in, according to the plaintiffs’ liaison counsel for the Zantac litigation, Rosemary Pinto of Feldman & Pinto.

An Administrative Judge from the Philadelphia Common Pleas initiated the Zantac program through a June order. Zantac claims began to flow into the Complex Litigation Center in July (35 claims) and exploded thereafter – plaintiffs’ lawyers filed 186 suits in August and an additional 332 in September. Full data for October was not available at the time of this report, but Zantac producers should “anticipate that the number of filings will continue to grow in the coming months,” said Zantac plaintiffs’ attorney Tracy Finken of Anapol Weiss.

New Mass Tort Programs For Herbicides

The Complex Litigation Center also initiated new mass tort programs for Roundup® (Bayer) and Paraquat (Syngenta), two of the most commonly used herbicides in the United States. Roundup® has been linked to cancer, though many scientists, including those at the EPA, have concluded otherwise. Similarly, a link between Paraquat and Parkinson’s disease has been hotly debated among scientists. Although these new programs haven’t been quite as trendy among plaintiffs’ attorneys as the Zantac program, both have seen steady growth since emerging this May: 154 claims had been filed in the first 6 months of the Paraquat pro- gram and 130 claims had been filed in the Roundup® program in the same time period. Despite the modest start, Thomas Kline, a founding partner of plaintiffs’ firm Kline & Specter, believes that the Roundup® pro- gram is “going to be the marquee program for the foreseeable future.”

Paraquat herbicide, has emerged as a top target of mass tort litigation advertising. Since the beginning of 2021, more TV ads have aired across the country soliciting claims alleging injuries caused by paraquat than mass tort ads related to any other product. More than $24 million has been spent on more than 150,000 of these ads since 2021.

A Second Wave of Reglan Litigation on the Horizon?

In 2018, Teva settled claims alleging that use of the digestion drug, Reglan, led to various illnesses. These lawsuits were centered in the Philadelphia Court of Common Pleas Complex Litigation Center, which had about 2,000 claims on its docket. Following the March 2022 publication of a journal article linking Reglan to an increased risk of stroke, a previously unknown side effect, more lawsuits may be coming.

Following this news, one plaintiffs’ attorney observed, “It is not out of the realm of possibility” that there would be a new wave of Reglan lawsuits may be on the horizon. If so, Philadelphia is likely to once again be the hotspot for Reglan litigation.

Risperdal

Risperdal, an anti-psychotic medication, has been one of the top targets of the trial bar in Pennsylvania. Despite an $800 million settlement announced by Johnson & Johnson, almost 1,000 claims were still pending in the Philadelphia Court of Common Pleas’ Complex Litigation Center as of November 2, 2022.

Asbestos Litigation

In 2021, Philadelphia remained the fourth most popular jurisdiction to file lawsuits claiming injuries from exposure to asbestos. Plaintiffs’ lawyers filed 203 asbestos lawsuits in Philadelphia in 2021. In the first half of 2022, Philadelphia dropped one spot (#5) in the jurisdiction rankings for asbestos filings, despite a 27.2% increase in lawsuits compared to the first half of 2021. In total, over 750 asbestos cases were pending in the Philadelphia Court of Common Pleas as of November 2022.

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