Cases to Watch: Gilead Life Sciences v. Superior Court
Gilead Urges California’s Highest Court to Restore Existing Product Liability Law
Cases to Watch: Gilead Life Sciences v. Superior Court
Gilead Urges California’s Highest Court to Restore Existing Product Liability Law
The Supreme Court of California is gearing up to decide an important question for the future of product liability law: Do drug manufacturers have a duty to innovate? In other words, does a manufacturer of a non-defective drug have a duty to develop and commercialize an alternative drug that is allegedly safer for some consumers?
As expected, the parties’ merits briefs in the Gilead Tenofovir Cases give different answers to those questions. Gilead’s opening brief urges the Supreme Court of California to reverse the Court of Appeal’s decision which, if adopted, would represent a significant expansion of existing negligence liability in California. In response, plaintiffs’ answering brief argues that the Court of Appeal had it right.
As we previously reported in our June 13, 2024 alert about the Gilead Tenofovir Cases, the California Court of Appeal held that plaintiffs could pursue a negligence cause of action against a prescription drug manufacturer for failure to bring an alternative, allegedly safer, drug to market sooner, even if the plaintiffs did not assert that the original drug they actually used was defective. The Supreme Court of California is now reviewing the lower court’s decision.
In its opening brief, Gilead argues that the Court of Appeal’s holding should be overturned because it:
[O]verrode a century of common law to impose on manufacturers a duty that no court anywhere in the country has ever suggested. Whereas the common law requires manufacturers to produce non-defective, reasonably safe products, the Court of Appeal has added a duty to develop and commercialize, without delay, a different product that is safer for some consumers. This duty weaponizes innovation across industries, undermining public welfare by inhibiting research and development of lifesaving and lifechanging products.
Petitioner’s Opening Brief on the Merits at 8, Gilead Tenofovir Cases, No. S283862 (filed July 15, 2024).
Plaintiffs, on the other hand, argue that the Court of Appeal correctly found that “a drug manufacturer owes a duty of care to users of a drug it is currently selling, which is not alleged to be defective, when making decisions about commercializing an allegedly safer and equally effective drug.” Plaintiffs’ Answering Brief on the Merits at 8, Gilead Tenofovir Cases, No. S283862 (filed Aug. 14, 2024).
Gilead warns that adopting this new duty would allow plaintiffs to second-guess complex business decisions and “doom manufacturers to a no-win cycle of liability, transforming every product-development decision into a potential lawsuit over the path not taken—or taken, but allegedly not quickly enough.” Petitioner’s Opening Brief at 10.
Gilead argues that the Court of Appeal erred for two independent reasons: (1) The court unilaterally abolished well-established precedent requiring a consumer who claims injury from a manufacturer’s product to prove that the product is defective; and (2) the court went further to create an unprecedented duty to develop and commercialize alternative products on an expedited timeline when they may provide additional benefits for at least some consumers.
Plaintiffs disagree that the court created a new duty. Rather, it is well established that “[m]anufacturers owe users of their products a duty of reasonable care and California law does not categorically limit this duty to simply producing a non-defective product.” Plaintiffs’ Answering Brief at 17.
Gilead asserts that it rigorously adhered to the traditional requirements of product liability law, which mandate that a product must not have defects in design, manufacture, or labeling at the time of sale. Without this limitation on a manufacturer’s liability, plaintiffs can challenge virtually any complex business decision: “[U]nder the Court of Appeal’s logic, once the duty of reasonable care moves beyond the product the consumer used to other business decisions, the duty becomes endless, with different classes of plaintiffs created by each corporate decision.” Petitioner’s Opening Brief at 28. Plaintiffs disagree that they would expand product liability law, asserting that Gilead conflates ordinary negligence and strict product liability and claiming that “California has never conditioned a manufacturer’s liability in negligence for harm caused by its product on proof that the product was defective.” Plaintiffs’ Answering Brief at 20.
According to Gilead, the Court of Appeal created an unprecedented duty for manufacturers to develop and market alternative products that might be safer for some group of consumers. Gilead relies on four key points to outline the Court of Appeal’s errors and show the negative implications of this new duty. Unsurprisingly, plaintiffs defend the Court of Appeal’s decision and attempt to refute each point.
Ultimately, the Supreme Court of California’s decision could have profound implications for manufacturers, particularly in the medical device and pharmaceutical industries. As Gilead frames it, expanding liability to include the duty to develop alternatives and bring them to market quickly could lead to a cautious approach towards innovation, potentially slowing down the introduction of new and improved products. We will continue to closely monitor this case to provide any key updates, and we are available to assist you in understanding its potential impact on your operations and legal strategies.
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