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The Indiana Court of Appeals recently issued an opinion applying the section of Indiana’s Product Liability Act (IPLA) that, under certain circumstances, creates a rebuttable presumption against a finding of defect or negligence in product liability actions.  See Gresser v. Dow Chem. Co., 2013 Ind. App. LEXIS 204 (Ind. Ct. App. Apr. 30, 2013).  The case involved a termiticide (termite treatment) and the EPA, but the opinion applies equally to cases involving drugs, medical devices and the FDA.

We’ve talked about statutory presumptions recently.  Last week, we posted on New Jersey’s statutory “super-presumption” (meaning virtually dispositive), which creates a rebuttable presumption that a warning about a drug or medical device is adequate if the warning was approved by the FDA.  As far as we know, Indiana’s presumption isn’t a “super-presumption.”  But in a number of ways it sweeps more broadly than New Jersey’s presumption.  For instance, it not only applies to drugs and medical devices, but to any product involved in a product liability action.  And if that product is regulated by the federal or Indiana government, compliance with those government regulations creates a presumption that the product is not defective and the manufacturer was not negligent – in other words, it addresses more than just failure-to-warn claims.  Here’s the statutory language:

Rebuttable presumption

Sec.1. In a product liability action, there is a rebuttable presumption that the product that caused the physical harm was not defective and that the manufacturer or seller of the product was not negligent if, before the sale by the manufacturer, the product:

(2) complied with applicable codes, standards, regulations, or specifications established, adopted, promulgated, or approved by the United States or by Indiana, or by an agency of the United States or Indiana.

Gresser involved the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), which required Dow to register its termiticide with the EPA.  Such registration meant that the “EPA must make an official agency determination that the product does not pose any ‘unreasonable risk to man or the environment, taking into account the economic, social, and environmental costs and benefits of [its] use.’”  2013 Ind. App. LEXIS 204, at *10 (quoting FIFRA).

And guess what?  Dow had registered the termiticide with the EPA.  Id. at *11.  It also submitted data in support of its registration that fully complied with Indiana law. Id.  And it distributed the termiticide with the current EPA-approved labeling.  Id.  Accordingly, the court concluded that Dow was “entitled to the statutory presumption.”  Id.  That presumption was against any defect claim, including both failure-to-warn and design defect.  And the court’s discussion of the policy reasons underlying the presumption would apply just as well to the FDA:

[C]ompliance with FIFRA and Indiana law has a significant impact under IPLA’s consumer expectation-based product liability regime because the risk of harm has been evaluated by agencies charged with the duty of monitoring the effects of [the product]. Furthermore, [the product’s] labeling and warnings have been approved by agency experts.

Id. at *10-11.  The court, accordingly, held that Dow was entitled to judgment on plaintiffs’ failure to warn and design defect claims.  Id. at *13.

Plaintiffs’ arguments to rebut the presumption didn’t work.  In some ways, what the plaintiffs argued hurt them.  For instance, they were also suing the contractor who applied the termiticide and alleged that “their injuries would not have occurred absent the contractor’s negligence.”  Id. at *12.  Well, that position seemed to undercut their claim that a defect in the product caused their injuries, something that wasn’t lost on the court.  Id.  Similarly, plaintiffs’ argued that Dow entered into settlements with the EPA and, as part of that, strengthened the product’s warnings.  True, it seems, but that all happened before the termiticide was used on their property.  The court also found that this argument, once again, undermined plaintiffs’ claims.  Id.

So there seem to be a lot of possibilities with this “government compliance” presumption in Indiana.  It may be quite useful, particularly at the summary judgment stage, in drug and device cases in which plaintiffs have little to no evidence that the defendant hadn’t complied with FDA regulations, and in which the defendant was using FDA-approved labeling.