In its April 2005 issue, <i>ICLB</i> published an article discussing the varying approaches courts have taken when addressing whether an insurer may conditionally defend its insured and later obtain reimbursement of defense costs if it is determined that a claim is outside the scope of coverage. <i>See</i> Pastor, Sherilyn: Insurers' Rights to Recoup Defense Costs, <i>Insurance Coverage Law Bulletin</i>, Vol. 4, No. 3 at p. 1 (Apr. 2005). As the issue was going to press, the Illinois Supreme Court issued an opinion rejecting the purported right of recoupment. <i>See General Agents Ins. Co. of Am., Inc. v. Midwest Sporting Goods Co.</i>, No. 98814, 2005 WL 674685 (Ill. March 24, 2005). Noting that its position was the "minority" view, the court in <i>General Agents</i> declined to recognize the so-called "right of recoupment" both as a matter of contract law and a matter of policy. (For an in-depth review of the <i>General Agents</i> decision, <i>see</i> Case Notes at p. 7.) The court was right on both counts.

In light of the numerous high-profile securities fraud scandals over the last few years, insurers have more frequently sought to rescind insurance policies on the basis that the insureds supplied false information in applying for such policies, just as they did in misleading their investors, regulators and others. For example, insurers have pursued rescission of policies issued to WorldCom, HealthSouth, Adelphia, Tyco and Xerox. As a result, courts across the country have had more opportunities to clarify the law in this area. Although the law varies somewhat from state to state, judicial opinions on this subject have addressed issues that are fundamentally important to insurers.

Highlights of the latest product liability cases from around the country.

The poor trial lawyer sat dejected as he watched the mock jury deliberating his product liability case. He and his colleagues had spent the better part of 2 days presenting their evidence to a group especially chosen by a jury consultant to reflect the demographics of the actual jurors before whom the real dispute would shortly be tried.

Features

For information about Vioxx directly from Merck, visit <i>www.vioxx.com</i>. The site posts the announcement of the withdrawal on Sept. 30, 2004, explaining that the voluntary worldwide withdrawal of VIOXX' (rofecoxib) was based on 3-year data from a prospective, randomized, placebo-controlled clinical trial, called the APPROVe (Adenomatous Polyp Prevention on Vioxx) trial. The trial, which was stopped, was designed to evaluate the efficacy of Vioxx 25 mg in preventing recurrence of colorectal polyps in patients with a history of colorectal adenomas. The announcement explains that in the study, there was an increased relative risk for confirmed cardiovascular events, such as heart attack and stroke, beginning after 18 months of treatment in the patients taking Vioxx compared with those taking a placebo. According to Merck, the results for the first 18 months of the APPROVe study did not show any increased risk of confirmed cardiovascular events on Vioxx, and in this respect, are similar to the results of two placebo-controlled studies described in the current U.S. labeling for Vioxx.

Features

Recently, the West Virginia Supreme Court of Appeals dealt a severe blow to class actions in that state. In laying the groundwork for a more stringent approach to class certification in West Virginia, the court in <i>State v. Madden</i>, 2004 WL 2750996 (W.Va. 2004), held that it was impermissible for a court in West Virginia, a state that was widely reputed to have the most liberal medical monitoring standards in the country, to include class members from states that have not adopted such liberal theories of recovery. The decision is also important for the court's admonition that classes should only be certified where all class members meet the criteria necessary for certification and its rejection of "drive-by" certifications.

In 2004, four drug cases, which were decided in different jurisdictions, effectively split on the issue of whether FDA labeling regulations pre-empt state common law failure to warn claims. <i>Fisher v. Professional Compounding Centers of America, Inc.</i>, 311 F. Supp. 2d 1008 (D. Nev. 2004) and <i>Kurer v. Parke, Davis &amp; Co.</i>, 272 Wis. 2d 390, 679 N.W.2d 867 (Wis. Ct. App. 2004) endorsed the view that FDA labeling regulations did not pre-empt common law failure to warn claims in drug cases, while <i>Dusek v. Pfizer Inc.</i>, 2004 WL 2191804 (S.D. Tex., Feb. 20, 2004) and <i>Needleman v. Pfizer Inc.</i>, 2004 WL 1773697 (N.D.Tex., Aug. 6, 2004) held that FDA regulations do pre-empt failure to warn claims, at least in certain circumstances.

Courts typically do not treat an inadvertent disclosure of documents protected by the attorney-client privilege as a waiver. When, however, a lawyer receives documents from the opposition that appear privileged, the issues quickly become complex. Questions arise as to the appropriate response. Unlike challenging a claim of privilege asserted in a privilege log, when the full substance of the communication is revealed through an inadvertent production, there is often a powerful incentive to challenge the applicability or scope of the privilege.