Learning From Medical Society Lawsuits.

Arecent lower court decision reviewed by a federal appellate court concerning a series of product liability cases was decided favorably for the medical societies named as defendants in a mass tort litigation. While the medical societies have been dismissed from the cases, the action holds implications for association educational programs.

The pedicle screw cases are a series of 2,000 product liability lawsuits brought against medical device manufacturers in 60 federal courts on behalf of 5,000 patients who claim injuries as a result of allegedly defective orthopedic bone screws attached to their spines during surgery. Some cases also named as defendants national medical specialty societies for orthopedic surgeons, neurosurgeons, and other specialists, the plaintiffs alleging that manufacturers paid the societies to sponsor and conduct seminars for their members--more for the purpose of promoting the devices than for educating the members. Plaintiffs also claimed that the societies failed to disclose both the lack of Food and Drug Administration (FDA) approval of the devices for use in back surgery and certain manufacturers' payments to the societies.

The cases were consolidated in federal district court in Philadelphia to resolve common issues. In 1997, the court determined that the medical societies could not be held responsible for participation in an alleged conspiracy with the medical device manufacturers in violation of the Food, Drug, and Cosmetic Act. The court also refused to resolve--and returned for resolution by the courts where the cases were first filed--the issues of First Amendment protection for the medical societies in offering educational programs, and the lack of causation between the programs offered to physicians and the ultimate alleged injuries to patients of the physicians.

Current findings

The recent federal appellate court review of the lower court's decision upheld the prior decision regarding the absence of liability for the medical societies on the theory of conspiracy to violate the Food, Drug, and Cosmetic Act. The court also agreed that it was appropriate for the resolution of the First Amendment and causation issues to be determined in the courts where the cases were first filed.

Equally important, there have now been numerous decisions--in the courts where the cases were originally filed--on the issue of the societies' responsibility for patients' injuries. In every case so far, the medical societies have been dismissed. Notably the cases have not addressed whether the societies' programs were pure academic speech, subject to the full protection of the First Amendment, or commercial speech, subject to constitutional protection only if not false or deceptive. Thus the long ordeal of the societies involved in this mass tort litigation is coming to an end.

Further implications

Virtually all associations routinely offer educational programming to members. Often speakers express views regarding the safety, efficacy, quality, practicability, and convenience of products. This programming may not be entitled to full First Amendment protection if there is a close connection between the programming and a manufacturer. The pedicle screw cases, then, are useful not only to medical societies but to all associations engaged in educational programming. Certain guidelines can minimize the risk of an association being held legally responsible if the products discussed at educational programs ultimately become the subjects of product liability lawsuits.

* It must be clear to program, attendees that the association does not necessarily endorse, approve, guarantee, or otherwise assume responsibility for statements and views of speakers, particularly when the speakers address subjects such as product and workplace safety.

* Speakers must disclose all potential conflicts of interest, including commercial interests, and disclose any known legal conditions or qualifications for use of products they discuss.

* If there is any possibility of confusion about the association's role and position, consider printing a disclaimer in the program brochure. In cases of special or extreme risk, run a special announcement or a written indemnification from the sponsoring vendor to the association.

* When receiving financial assistance from vendors in connection with educational programming, maintain and exercise exclusive authority for determining speakers, subjects, content, emphasis, and other aspects of the programs.

* Congress has enacted safe harbors for corporate sponsorships. Associations should refer to them to help determine the circumstances in which payments by vendors to exempt organizations must be treated as taxable income.

* Associations should carry the best possible insurance that they can afford to indemnify and defend these kinds of derivative tort claims. Most directors and officers policies (association liability coverage) exclude coverage for bodily injury and property damage claims. Such coverage may be included in comprehensive general liability policies (association office coverage). The assistance of experienced professionals in evaluating coverage is essential.

Jerald A. Jacobs is a partner in the Jenner & Block law firm, Washington, D.C., and is general counsel to ASAE.