Save the case using the discovery rule: statutes of limitations threaten some mass tort cases with an early death. A favorable interpretation of the discovery rule can keep them alive.

Defendants in mass tort cases use a variety of strategies to thwart plaintiffs' injury claims. One of the most common is to invoke the statute of limitations. If a polluter, manufacturer of defective products, or other defendant can convince a court that the plaintiffs failed to bring their claims within the period allowed by law, the company can evade liability for the large-scale harm it caused.

In recent years, courts and state legislatures in various parts of the country have taken increasingly strict views about when the statute of limitations begins to run--in cases from latex glove litigation to toxic-tort class actions.

For plaintiffs and defendants alike, the statute-of-limitations issue is one of the first to arise when evaluating a case. A statute of limitations is a rule, created by courts or lawmakers, that prescribes the time past which a plaintiff may not bring a particular cause of action in the relevant jurisdiction. (1) They are essentially policy-driven limits on when a plaintiff may bring a suit. (2) Legislatures may enact them to protect certain industries from litigation, and trial courts may implement them to decrease the number of cases that end up in lengthy trials.

In California, for example, strict applications of statutes of limitations have left many plaintiffs with limited access to the courts, regardless of the merits of their cases. (3) The same result can be seen in other jurisdictions, including North Carolina (4) and Washington. (5)

But though statutes of limitations may sometimes prevent legitimate claims from reaching the courts, they do serve at least two important purposes: They protect defendants from stale claims, and they motivate plaintiffs to assert fresh claims in a diligent manner. (6) As the U.S. Supreme Court explained almost 60 years ago,

   Statutes of limitation ... are designed to promote justice by preventing
   surprises through the revival of claims that have been allowed to slumber
   until evidence has been lost, memories have faded, and witnesses have
   disappeared. The theory is that even if one has a just claim it is unjust
   not to put the adversary on notice to defend within the period of
   limitation and that the right to be free of stale claims in time comes to
   prevail over the right to prosecute them. (7)

As a general rule, statutes of limitations begin to run after "accrual of the cause of action." (8) Legislators often neglect to define "accrual of action." When this happens, courts generally interpret it to be the time "when, under the substantive law, the wrongful act is done and the obligation or liability arises." (9) Thus, a cause of action is complete, and the applicable statute begins to run, when all the elements of the cause of action have occurred. (10)

Because it arbitrarily forecloses legitimate claims, this general rule is tough for plaintiffs. In order to avoid such harsh results, several courts have recognized exceptions. The most significant is the so-called discovery rule, under which a cause of action accrues--and the statute of limitations begins to run--not on the date the tortious act occurs but on the date the plaintiff discovers, or reasonably should have discovered, both the injury and its cause. (11)

Courts that use the discovery rule disagree about what "cause" triggers the running of a statute of limitations. For instance, Pennsylvania courts interpret the rule to require only that the plaintiff know the physical cause of his or her injuries--for example, that a prescription drug caused an increased risk of heart disease. (12) Other courts say the statute does not begin to run until the plaintiff discovers a negligent cause, such as the manufacturer's failure to warn of the drug's dangerous side effects.

The California Supreme Court adopted the latter approach in Jolly v. Eli Lilly & Co. The court identified three elements that must be present for the clock to begin running: suspicion of wrongdoing; knowledge of the harm; and sufficient knowledge of the cause of the harm that plaintiff believes he or she is entitled to recourse. (13)

The plaintiff in Jolly was born in 1951 and was told in 1972 that, as a daughter of a woman who had taken diethylstilbestrol (DES) to prevent miscarriage, her reproductive organs might be injured later in life. Four years later, Jolly had a Pap smear that indicated an abnormality, and that tissue was surgically removed. In 1978, after she had a hysterectomy, Jolly came to believe that someone was at fault for her injuries and should compensate her. She sued Eli Lilly, which manufactured DES, in 1981.

Eli Lilly contended that Jolly's case was barred because the statute of limitations had begun to run more than a year before she filed her lawsuit, when she knew of her injury and its factual cause.

Although the court concluded that the statute had indeed run and upheld the dismissal of Jolly's case, it disagreed with the defendant's theory of what triggered the statute and adopted a more liberal approach. It held that the statute of limitations does not begin to run until the plaintiff suspects wrongdoing, "coupled with a knowledge of the harm and its cause." (14) The court concluded that the statute began to run in 1978, when Jolly became aware of lawsuits alleging that Eli Lilly was liable to "DES daughters" for failing to warn their mothers of potential injuries to their female children.

In identifying the events that triggered the statute, the court looked past the warning Jolly received in 1972 and the need for surgery in 1976. Instead, it focused on 1978, when Jolly admitted that she suspected that wrongdoing caused her injuries. According to the court, that suspicion was enough to put Jolly on notice; at that point, a reasonable person would have investigated the injuries and their possible causes.

Narrowing the rule

In 1999, the California Supreme Court revisited the discovery rule in Norgart v. Upjohn Co. Although the court cited the holding in Jolly as authority in Norgart, the latter ruling has dramatically limited the application of the discovery rule.

Reflecting a trend among courts in other jurisdictions to narrow the rule, the California court held that the statute of limitations begins to run when a plaintiff suspects, or has reason to suspect, a factual basis for a cause of action. (15) Under these decisions, once a plaintiff knows or suspects a physical cause of his or her injury--as opposed to a negligent cause--the clock begins ticking.

In Norgart, the plaintiffs brought a wrongful death suit against Upjohn Co., the manufacturer of Halcion, a prescription sleeping pill. They alleged that six years earlier, their daughter had committed suicide by taking an overdose of prescription drugs including Halcion. Seeking to avoid the harsh impact of the one-year statute of limitations applicable to wrongful death cases in California, the Norgarts alleged that Upjohn fraudulently concealed Halcion's side effects, including its tendency to intensify depression. They claimed that they had no reason to suspect wrongdoing until they learned of Halcion's "dangerous propensities" in news reports.

The court dismissed the suit as barred by the statute of limitations, holding that the Norgarts' wrongful death cause of action "accrued when they came at least to suspect, or have reason to suspect, a factual basis for their elements, which occurred as early as the date of Kristi's death on October 16, 1985, but no later than some date prior to mid-1986." (16) The Norgarts did not file their claim until October 1991.

Norgart and similar rulings from other jurisdictions are now the cornerstone of many defendants' statute-of-limitations arguments. A common defense tactic, especially in toxic tort cases, is to assemble media reports on the danger posed by a specific toxic substance. The goal is to show that there was sufficient public notice of the hazard to trigger the statute of limitations in the plaintiffs case. Defendants frequently urge the court to rule that publicity was so pervasive that the average citizen would suspect that he or she was affected, regardless of whether the plaintiff in the case actually saw or read the reports.

Defendants may submit newspaper articles, tapes of TV broadcasts, and written reports on toxic sites that are required by law to be placed in public libraries. These submissions are often designed to sway the court by their sheer volume. Under this approach, even if a plaintiff testifies that he or she does not read a newspaper, the defense argues that because of the pervasive media coverage, it should be presumed that the plaintiff had sufficient notice to suspect wrongdoing.

For example, in McKelvey v. Boeing North America, Inc., the plaintiffs brought two class actions against Boeing, seeking compensation for their exposure to contaminated soil and groundwater. (17) Boeing argued that the suit was barred by the statute of limitations, and it submitted copies of newspaper articles, transcripts of radio and television broadcasts, and government "fact sheets" describing the contamination in support of its demurrer.

The California Court of Appeal held that, given the widespread publicity, the plaintiffs had failed to meet their burden of showing that they could not have discovered the defendant's wrongdoing through reasonable diligence. (18)

The court held that the plaintiffs' complaint failed because they did not explain when and how they discovered the harm or give reasons for their inability to discover Boeing's wrongdoing within the limitations period. Also, the court deemed the complaint inadequate because it failed to allege that the plaintiffs did not "read, hear, or see the articles and broadcasts they admit were published." (19)

Accordingly, Norgart, McKelvey, and cases like them may foreclose plaintiffs' access to the courts--in many instances, before the plaintiffs can develop their cases sufficiently to determine the negligent cause of their injuries.

Returning to a broader reading

In Clark v. Baxter Healthcare Corp., a California appellate court signaled its intention to return to the discovery rule as announced in Jolly: that to start the limitations period, plaintiffs must be aware not only of their injury and its factual (that is, physical) cause, but also of sufficient facts to put them on inquiry notice of a negligent cause. (20)

The plaintiff in Clark was a nurse who wore several layers of powdered latex gloves at work between 1990 and 1993. In 1992, she began to suffer from intermittent rashes on her hands, and she had difficulty breathing and keeping up with her workload. In 1994, Clark consulted a dermatologist, who told her that her symptoms could be related to a possible latex allergy and advised her to stop using the gloves.

In 1995, Clark underwent a routine gynecological exam and suffered an anaphylactic attack triggered by an allergic reaction to the latex gloves the physician wore. At the time, Clark believed that although she could not wear latex gloves, she would not be harmed if another person wearing the gloves examined her. Clark filed her complaint in 1996, and the trial court entered summary judgment for the defendants on statute-of-limitations grounds.

The court of appeal reversed, holding that a jury should decide whether Clark, when she learned of her allergy, had enough information to understand that she had a potential products claim. The court concluded that there were triable issues of fact concerning whether she knew that a defendant's wrongdoing might have led to her injury. The court stated that a plaintiff must be aware of her injury, its factual cause, and sufficient facts to put her on inquiry notice of a negligent cause.

The court distinguished Clark from Norgart by finding that the inadequate record before it created a triable issue of fact regarding when the plaintiff suspected wrongdoing. Therefore, further factual development was required to determine when the statute of limitations began to run.

Courts in other jurisdictions have reached similar conclusions. For example, in In re New York County DES Litigation, a New York appellate court applied the discovery rule under Indiana law. (21) Comparing the case to Dalkon Shield intrauterine device litigation, the court found that, although the plaintiff knew of her injury and its cause in 1975, a factual question existed regarding when she knew or should have known that her injury resulted from "tortious conduct." Like the California court in Clark, the New York court required that the plaintiff have knowledge of the negligent cause of her injury before the statute of limitations begins to run. (22)

Getting to court

Drawing on lessons learned in California and New York, plaintiffs in jurisdictions where courts have narrowly interpreted the discovery rule can argue that the limitations period should begin to run only when the injured party discovers the negligent cause of the injury.

This approach allows plaintiffs to proceed on the merits of their legal claims, which otherwise would be arbitrarily foreclosed. It also avoids unduly harsh results based on findings that the plaintiffs had constructive notice of the cause of their injuries.

Asking a judge to find that a plaintiff must know the negligent cause of injury before the statute of limitations begins to run does not undermine the statute's original purposes: to prevent stale claims from being brought and to motivate plaintiffs to file promptly.

Plaintiffs who do not discover the negligent cause of their injuries until after the statute has run have not necessarily failed to investigate diligently. More likely, forces outside their control have prevented them from discovering the cause.

For example, in both the California and New York DES cases, the plaintiffs lacked the sophistication they needed to understand the defendant's wrongful conduct and the medical cause of harm. In other words, given how complicated harmful exposures to toxic substances or defective products can be, defendants shouldn't be able to defeat claims, by arguing that the plaintiffs suspected that somebody did something to harm them yet failed to act on that suspicion.

Also, plaintiffs who fail to pursue their claims diligently have little chance of discovering the negligent cause. A plaintiff who works hard to discover the negligent cause of an injury--but needs the discovery rule to avoid a statute-of-limitations bar--should not be prohibited from bringing an otherwise meritorious cause of action. Some injured parties, despite their best efforts, cannot determine the negligent cause of their injury within the period set by the statute of limitations.

The law on the discovery rule remains unsettled. Courts often take a strict view of the statute of limitations when they perceive a rush of new cases to their dockets and are persuaded by the defense argument that the "floodgates" of litigation must be slammed shut.

Plaintiffs who cite case law that distinguishes between physical and negligent cause as the trigger for statutes of limitations can restore access to justice for severely injured plaintiffs.

Notes

(1.) See 3 B.E. WITKIN, CALIFORNIA PROCEDURE, ACTIONS [section] 405 (4th ed. 1996).

(2.) Chase Sec. Corp. v. Donaldson, 325 U.S. 304, 314 (1945).

(3.) See Norgart v. Upjohn Co., 981 P.2d 79, 88 (Cal. 1999).

(4.) Soderlund v. Kuch, 546 S.E.2d 632 (N.C. Ct. App. 2001).

(5.) In re Estate of Peterson, 9 P.3d 845 (Wash. Ct. App. 2000).

(6.) See Norgart, 981 P.2d 79, 88.

(7.) Order of R.R. Telegraphers v. Ry. Express Agency, Inc., 321 U.S. 342, 348-49 (1944).

(8.) See Norgart, 981 P.2d 79, 88.

(9.) WITKIN, supra note 1, at [section] 405.

(10.) See Neel v. Magana, Olney, Levy, Cathcart & Gelfand, 491 P.2d 421, 428 (Cal. 1971); In re Latex Gloves Prods. Liab. Litig., 134 F. Supp. 2d 415, 420 (E.D. Pa. 2001) (applying Pennsylvania discovery rule and finding that statute of limitations begins to run when a plaintiff has critical facts to place him or her on notice that a toit has been committed and that prudence dictates further investigation).

(11.) See United States v. Kubrick, 444 U.S. 111 (1979);Norgart, 981 P.2d 79, 88 (citing WITKIN, supra note 1, at [section] 463); Witherell v. Weimer, 421 N.E. 2d 869 (Ill. 1981); Huggler v. City of New York, 709 N.Y.S. 2d 380, 382-83 (Sup. Ct. 2000); Baird v. Am. Med. Optics, 713 A.2d 1019, 1024 (N.J. 1998).

(12.) See In re Latex Gloves Prods. Liab. Litig., 134 F. Supp. 2d 415, 420, 422 n.16.

(13.) 751 P.2d 923 (Cal. 1988).

(14.) Id. at 928.

(15.) See Norgart, 981 P.2d 79, 88; see also In re Latex Gloves Prods. Liab. Litig., 134 F. Supp. 2d 415, 421-22; Ports v. Celotex Corp., 796 S.W.2d 678, 680 (Tenn. 1990).

(16.) Norgart, 981 P.2d 79, 93.

(17.) 86 Cal. Rptr. 2d 645, 651 (Ct. App. 1999).

(18.) Id. at 652.

(19.) Id.

(20.) 100 Cal. Rptr. 2d 223, 228 (Ct. App. 2000).

(21.) 642 N.Y.S.2d 677, 679 (App. Div. 1996). The court found that the cause of action had accrued in Indiana and so applied that state's law.

(22.) See accord Anthony v. Abbott Labs., 490 A.2d 43, 46 (R.I. 1985).

Bruce L. Simon is a partner in the law firm of Cotchett, Pitre & Simon in Burlingame, California. He wishes to thank Peter Borkon, an associate at the firm, for his assistance in preparing this article.