Strict product liability for recall of medicinal devices - CJEU in Boston Scientific Medizintechnik GmbH (C-503/13 and C-504/13)

5 March 2015: CJEU judgment in Boston Scientific Medizintechnik GmbH (C-503/13 and C-504/13)

Previously, we discussed the opinion of AG Bot in this case (see Medicinal product recall allows to claim damages for surgical removal thereof? - AG Bot in case Boston Scientific Medizintechnik GmbH (C-503/13 & C-504/13)). Briefly, the case brought up interesting issues of whether the special product liability regime introdued by the Product Liability Directive could apply in cases of product recall. That is to say, when a specific product has not (yet) proven to be defective (but the group of products to which it belongs showed a tendency of particular defect appearing) nor did it cause any damage due to its defect (but certain damage was caused as a result of this product's recall). It may be important that this case pertained to a specific class of products, namely, medicinal devices that have been installed inside human body, and, therefore, their recall involved surgical procedures. 

The Court of Justice agrees with AG Bot that the notion of 'defect' should be broadly understood, in accordance with Recital 6 of the Directive that requires that not only expectations of the consumers as to the safety of the product would be taken into account, but also of the public at large (Par. 37). With regard to medicial devices, this safety threshold is quite high, since their defect may cause significant damage to consumers (Par. 38-40).

"Accordingly, where it is found that such products belonging to the same group or forming part of the same production series have a potential defect, it is possible to classify as defective all the products in that group or series, without there being any need to show that the product in question is defective." (Par. 41)

 Whether the patient could claim compensation for the costs of the surgery removing the malfunctioning device and installing a new one, would depend among other on whether such a surgery was "necessary to eliminate harmful consequences and to restore the level of safety which a person is entitled to expect" (Par. 49).

The CJEU had no doubt that the costs for the replacement of the defective pacemakers should be paid by its producers, but with regard to defribillators it left the decision to the national court - since pursuant to the producers these defective devices instead of being replaced could have also been just deactivated. The national court needs to determine whether that would be sufficient to "overcome the defect in that product, bearing in mind the abnormal risk of damage to which it subjects the patients concerned". (Par. 54)

Medicinal product recall allows to claim damages for surgical removal thereof? - AG Bot in case Boston Scientific Medizintechnik GmbH (C-503/13 & C-504/13)

21 October 2014: Opinion AG Bot in case Boston Scientific Medizintechnik GmbH (C-503/13 & C-504/13)

Imagine you had a pacemaker installed. It's already quite a stressful and invasive procedure, but then you find out from your doctor that the type of pacemaker that was used in your surgery has been found out to fail "from time to time". Since the producer of the pacemaker advises your doctor to think about exchanging your pacemaker due to a defect in their design for another one, with less chances of a failure, you agree to a new surgery. Who's going to pay for it though? The German courts were pretty certain that it should be the producer of the faulty product (a faulty pacemaker in case C-503/13 and a faulty defibrillator in case C-504/13) but some questions have been asked to the CJEU to ascertain the rules of the Product Liability Directive in such cases.

First, to claim damages under the Product Liability Directive the consumer needs to prove that the product he acquired was faulty. In the given case, there was a presumption that the medical products could fail working at one point (based on the extensive testing of copies of this product) and due to the increased risk of such a failure these products were deactivated. This means, however, that in these specific cases the defect did not manifest itself, since the removal of the medicinal products prevented this occurrence. The AG Bot nonetheless considers such medicinal product to fulfill the requirements posed in the Product Liability Directive to a faulty product. (Par. 26) Art. 6 of this Directive states that when the product does not offer consumers expected by them safety standards, it should be perceived as faulty. Recital 6 determines that "to protect the physical well-being and property of the consumer, the defectiveness of the product should be determined by reference not to its fitness for use but to the lack of the safety which the public at large is entitled to expect". The AG Both is, therefore, convinced that the test is an abstract one, not necessarily relying on the specific consumer's case, but rather during which it is justified to assume that if a consumer has a product identical to the one that already showed serious defects, he may reasonably question the safety of his product as well. (Par. 29, 33) Additionally, AG Bot claims that effective consumer protection requires that consumers could claim liability for defective products also prior to these products causing any damage. (Par. 38) While this statement is true, it needs to be said that this effective protection could be granted to consumers through measures other than Product Liability Directive, which is very much focused on compensating consumers for specific damage that was caused by a defective product. This opinion seems to be broadening the scope of application of the Directive, which until now was very narrowly interpreted.

Second, as mentioned above, the Product Liability Directive is meant to facilitate easy compensation of consumer's damage resulting from the defective product. The question was whether the costs of a surgery to remove a defective product (removal of a pacemaker or a defibrillator) could be seen as damage caused by personal injury. (Par. 56) While not all language versions of the Directive used a term with the same meaning of a 'personal injury', the theological interpretation points out that the Directive aims at protecting, in general, the 'health' of the consumer as well as his 'physical integrity'. (Par. 61) Therefore, excluding from the scope of the notion of 'damage' such damage that is caused due to a surgical intervention to remove a defective medical product would undermine this legislative purpose. (Par. 63) The causal link between the damage and the defect would then be for the national courts to prove (Par. 70) but the fact that the producer of the defective products recommended their removal to the doctors could be perceived as such evidence. (Par. 71)

It's a very interesting case that may influence the scope of application of the Product Liability Directive. Considering its limited application in practice and the fact that in such important cases as product recall due to increased risk to consumer health the compensation rules in the EU should be harmonized, it is clear why the AG Bot took the stand he did. It remains to be seen whether the CJEU shares this point of view.

European Parliament's last stands

Last week, the European Parliament voted in its plenary session on a few proposals that are important for consumers and their fate needs to be set prior to the end of term of the current Parliament. Let us take a short look at the results of last week's session:

Roaming fees and open access internet

In the first reading on the new Telecoms package, the European Parliament consolidated work conducted so far and is ready to give a further go at it to the new Parliament after the elections (see previously: MEPs say NO to roaming and YES to open internet). The package not only aims at abolishing roaming charges in Europe as of December 2015, but also at prohibiting internet access providers from blocking or slowing down selected services ensuring more net neutrality. (Ensure open access for internet service suppliers and ban roaming fees, say MEPs)

Clinical trials

We have previously mentioned on this blog the need for ascertaining more transparency of clinical trials' data, so that it could be more thoroughly tested and so that its' results could be subjected to more academic, objective scrutiny (see e.g. Who's keeping the score?...). This would increase patients' safety. On 2nd of April the European Parliament voted for a new proposal amending the existing Clinical Trials Directive. Pharma companies and academic researchers will now have to post the results of all their European clinical trials in a publicly-accessible database. The new law is also supposed to facilitate easier cross-border cooperation, which is expected to enable bigger, more reliable trials. The European Commission will be authorized to do the checks of reporting procedures, which themselves are simplified. (Clinical trials: clearer rules, better protection for patients) The proposal has already informally been agreed with by the Council so it should not take long to adopt it as law. This new proposal is welcomed by the European Ombudsman who often had to deal with complaints that citizens were refused access to clinical trials data (Clinical trials vote is a triumph for transparency in EU healthcare).

Medical devices

The MEPs voted in the first reading on the proposal for a new Regulation on medical devices in order to consolidate the existing various projects of that law and pass it on to the new Parliament. (see our previous post: New European rules on medical devices) We discussed the need for this law previously, mentioning the scandals with faulty breast implants, for example. New provisions are to enforce stricter monitoring and certification procedures of medical devices, therefore, increasing consumer safety. (Medical devices: better controls and traceability to ensure patients' safety)

Consumer payments

The European Parliament adopted also last week the proposal to cap bank fees for processing consumers' payments in the EU (at 0.3% of the transaction value for credit card transactions and at a maximum of seven euro for debit cards). (MEPs push for card payment fee caps and online payment safeguards) The caps will apply to both domestic and cross-border transactions and in time should lead to lower prices for card users. They will enter into force one year upon this law's adoption. Moreover, the MEPs decided to strengthen online payment safeguards by, among others, introducing a uniform set of information that would clearly state all charges, execution times, contact information and exchange rates. Unauthorized payment will need to be refunded within 24 hours of their being noticed. Consumers should not bear losses of illegal use of their stolen or lost cards above €50. (see our previous post: Money, money, money...)

Healthcare tourism

On October 25th the new Directive on cross-border healthcare of 2011 had to be implemented in all Member States. This means that currently consumers should be able to at their convenience go abroad in search of medical treatments and medical care. The new rules will make reimbursement claims less formalistic, provide better information to consumers on their patients rights and complaint procedures abroad. Additionally, consumers should be able to easier determine whether a given healthcare specialist is fit for practice and if they are issued prescriptions in another Member State they should be honored by the pharmacists in their country of residence, too. For more information, see Q&A of the European Commission.

The rules mentioned above harmonize situation of consumers who want to seek medical care abroad and of those who receive prescriptions from another Member State. However, it cannot be said that these rules guarantee patients' safety in Europe. If there are no strict, harmonized rules on authorization of medical devices, consumers could be severely harmed in the process. Imagine buying a pregnancy test during your holidays in another Member State, it being faulty due to more relaxed supervision measures and you ending up believing you are not pregnant and partying weeks long to your health's detriment. To prevent such black scenarios on 22 October the European Parliament looked into another subject related to improving healthcare in Europe - the safety of medical devices. The review of currently binding rules is to bring about more disclosure towards consumers on medical devices and involve them in the monitoring of such devices. A great idea is the facilitation of reporting defects. BEUC still argues for more changes in the newly drafted law, however, asking the European institutions to put a stop to producers using consumers as guinea pigs of their products and instead putting stricter rules on when products may enter the European market. (Parliament opens the door to safer medical devices)

New European rules on medical devices

The commission has issued today two regulation proposals with the intention to replace existing- and apparently obsolete- directives :

• A proposal for a Regulation on medical devices (to replace: Directive 90/385/EEC regarding active implantable medical devices and Directive 93/42/EEC regarding medical devices);
• A proposal for a Regulation on in vitro diagnostic medical devices (to replace Directive 98/79/EC regarding in vitro diagnostic medical devices).

The objective is to enlarge and clarify the scope of EU legislation, improve the functioning of assessment bodies, achieve more transparency and match the regulation to the current state of science while revising manufacturers' rights and duties. The commission also seeks to foster international trade by "alignment to international guidelines". 

Health and Consumer Policy Commissioner John Dalli said "Just a few months ago, everybody was shocked by the scandal involving fraudulent breast implants which affected tens of thousands of women in Europe and around the world. As policy makers, we must do our best never to let this happen again. This damaged the confidence of patients, consumers and healthcare professionals in the safety of the devices on which they rely every day. The proposals adopted today significantly tighten the controls so as to ensure that only safe devices are placed on the European Union's market at the same time, they foster innovation and contribute to maintaining the competitiveness of the medical device sector."

If you are curious to know more about how the regulations should fulfill this daunting functions, please have a look here and here.