Physician and Medical Device Defendants Collaborative Defense Strategies

What Causes the Strain?

Let us examine some “context factors” that create tension between doctors and medical device manufacturers. What makes the alliance uneasy?

The Starting Blocks

Physicians and hospitals leave the investigative starting gates faster than device manufacturers. Doctors and hospitals have earlier notice of loss and they know more about the medical mishap, or at least tend to know it sooner. They have first crack at the evidence, while the trail is still warm, before witnesses leave the state or memories fade. They often have the first opportunity to deal with the injured patient and the family — to do “spin control” about how a mishap occurred. They are also in a position to write off bills to appease an upset patient. Doctors and healthcare facilities also often have physical possession of the product, which can be key to an effective defense. They can engage consultants to have the device tested and checked out, giving them an early advantage in launching a successful defense.

The 'Spin Doctor'

Doctors have early contact with patients after a medical mishap. They can offer sympathy. They can explain. They can also point to the device as the culprit that caused the injury, deflecting negative attention away from themselves and toward the device maker. It is often easier to say, “The device malfunctioned,” than to say, “I messed up.” Studies show that a good bedside manner reduces the odds of a doctor getting sued. Medical device companies are by definition corporations and do not have “bedside manners.”

Consent to Settle

Many medical malpractice policies still contain “consent to settle” clauses, which can often complicate settlement and exert pressure on manufacturers to contribute more money. The “consent to settle” issue often affects a doctor's professional pride. Settlements may endanger the doctor's “preferred provider” status. Doctors may take a “no pay” stance at the negotiating table, sometimes even against their own counsel's advice. This can create a situation where extra pressure builds on the device maker to pay more in order to make up the difference. The doctor may even be financially rewarded for intransigence. Insured device companies typically do not have “consent to settle” clauses in their product liability insurance policies. They cannot use this as an impediment against financial participation in settlement.

Caps on Recoveries

Caps on recoveries against doctors and hospitals often make device companies “deep pockets.” Doctors have achieved some success with state law tort reforms that have placed caps on recoveries against doctors or hospitals. This is good news for doctors. By contrast, it is bad news – sometimes – for device companies, which enjoy no such limitation on their liability. If I am a plaintiff's attorney, this may leave the device company as the “deep pocket,” and target defendant. Why? For the same reason Willie Sutton robbed banks: “Cause that's where the money is.”

The National Practitioner Database

The National Practitioner Database often complicates settlement. If a doctor settles, his or her name may enter the National Practitioner Database. He or she may have strong feelings against this and, as a result, refuse to settle. Manufacturers do not have anything like a National Practitioner Database. While they are often emotionally tied to their products and have strong feelings about settlement, they cannot use the Database as a reason to forego settlement. The net effect of this in negotiating dynamics is often to make plaintiffs focus the spotlight on the device company as the target defendant, since the doctor is adamant about refusing to settle due to the Database issue.

Low Insurance Policy Limits

A practitioner's low insurance policy limit can deflect litigation focus away from him or her and toward the manufacturer. Corporations often carry more insurance than do physicians. If a doctor opted for low liability limits, this can draw attention away from the provider and focus it on the “deep pocket” manufacturer. Some doctors think that having insurance coverage makes them a more likely target for suits. Others might think that “going bare” deters suits, since the lawyer or plaintiff won't have a deep pocket to pick. Some doctors may intentionally carry low liability limits because that is all they can afford, or want to buy. Or maybe they just do not think that it is very likely that they will get sued. Device companies can find a cruel irony: Their “reward” for being prudent managers of risk and not under-insuring is to become the target defendant because that is the most promising recovery angle for the plaintiff.

Consider a hypothetical situation where you are a plaintiff's attorney and have a “bad baby” case. You are suing a doctor, who has a $1 million policy, and a fetal monitor manufacturer, which has $10 million in liability coverage. On whom should you focus? This is not an agonizing question for most personal injury professionals.

Product Liability Defenses

Another factor making the alliance uneasy is the state of the law, where certain defenses to product liability claims can also produce friction with co-defendant doctors. Device manufacturers often assert certain theories and defenses, such as: 1) “user error” – where the MD disregarded warnings or used poor technique; 2) poor patient selection; 3) lack of informed consent; or 4) the learned intermediary defense.

The Good Neighbor

Manufacturers are often faceless/ bloodless entities with no local or community presence. By contrast, the doctor or hospital likely has roots in the community where the suit arises.

These are factors causing friction between doctors and device companies in liability claims and litigation. This friction tends to benefit the plaintiff, may inflame a jury and may elevate awards and settlements. Physicians and device firms fighting each other can win the “battle” but lose the “war.” Such “victory” may be Pyrrhic. In foreign policy nomenclature, especially discussions regarding nuclear weaponry, there is an acronym, “MAD,” which stands for “mutually assured destruction.” One could call internecine fighting between doctors and device firms a “Kevorkian strategy” in litigation. There are few pat answers, but let us examine some possible approaches and remedies.

Strategies for Defense Coordination

The doctor often claims the product was defective because it broke or malfunctioned. The device maker claims the doctor over-torqued the device, used it inappropriately, failed to get informed consent, or used sloppy technique. If I am a plaintiff attorney, this is a promising litigation scenario. The defendants are making my case for me. The jury will have a relatively simple choice: They know the plaintiff is blameless, now, it is just a question of which defendant is going to pay, or if both of them will. The plaintiff attorney can play the device company against the doctor, or the doctor against the device maker. The plaintiff's attorney is the chief beneficiary when co-defendants snipe at each other.

The single most important step in avoiding infighting among defendants is early communication among all parties. A “meet and confer” session shortly after suit is filed can yield benefits. Try to establish rapport with co-defendants. Forge an alliance or an agreement to disagree — but only after the fact.

A fall-back option is to forge a mutual non-aggression pact. Agree that there will be no cross-complaints among the doctor, hospital and device manufacturer. Once aggressive in-fighting starts, it is very hard to put the genie back in the bottle. Eschew finger-pointing, at least until the facts are in. Here, any sniping is deferred till discovery is finished and you have a clearer picture as to whether the injury was caused by a defective product, by medical malpractice, a combination of the two or none of the above.

Admittedly, there are problems and challenges with this approach:

• First, it consumes a lot of time, money and requires much self-restraint;
• Second, even after considerable discovery, it is possible that no clear picture will emerge, or the facts may point to a blend of product defect and medical malpractice; and
• Third, it may only delay the warfare, which, when it eventually erupts, still benefits the plaintiff.

It is a sub-optimal solution, but is still better than “pitched warfare” right out of the starting blocks.

Another fall-back option is to get agreement that, if a united defense is no longer possible, the respective co-defendants will be the first to know. This avoids the specter of anyone getting “blind-sided” or hit with nasty surprises. Moral: Agree to share information with each other. Another key consideration is to assess and weigh the doctor's role and relationship with the manufacturer. Sometimes the doctor may be a key customer. There may be business reasons why the device company does not want to “point fingers” at the doctor or hospital.

Does the doctor do any training on the product? If not, there may be a better chance that the mishap was due to his or her lack of training or unfamiliarity with the device. Many studies have shown that for certain procedures involving medical equipment, training and experience are key determinants of patient outcomes. That is certainly the case in angioplasty procedures, for example. Another question to ask: “Is the doctor an investor in the device company or have any financial ties through royalties or licensing agreements? These are increasingly open to scrutiny on conflict of interest grounds.

Stipulating to Liability and Trying the Case on the Issue of Damages

In cases of a clear error in physician judgment or technique, consider stipulating to liability and limiting trial to damages alone. Defendants can agree that stipulating to liability for trial purposes will not bind any of them to admitting liability for arbitration purposes. This offers the prospect of limiting damages by keeping evidence of certain defendant's conduct away from the jury. Often, defendants can agree that inter-defendant finger pointing only inflames jury sympathy for a badly hurt plaintiff.

For example, Medmarc Insurance recently defended a lawsuit involving a catheter. The device developed a hole, causing a premature infant to exsanguinate during surgery. The hospital, the resident, the anesthesiologist, the surgeon and the catheter maker were all sued. At the outset, respective defense counsel met and decided that finger pointing would hurt all the defendants and help the plaintiff. Defendants agreed informally to not affirmatively help the plaintiff. But, this was not done at the expense of individual clients. Counsel avoided blaming other defendants but — if bad facts arose — so be it. Fortunately, all defense counsel were experienced. No one deviated from the informal agreement. Collectively, the case was settled for a relatively reasonable amount.

Admittedly, and unfortunately, a united defense is not possible all the time. A doctor or device manufacturer with the lion's share of liability may settle for a pittance and get a “good faith” settlement, thereby barring any later cross-complaints. Often, this provides “seed money” for the plaintiff's lawsuit against the remaining co-defendant(s) with a lesser or no degree of fault, who could still be tagged at trial by a sympathetic jury in a verdict that is “joint, several” and substantial.

Another — creative but somewhat more radical — solution is for the device company to agree to defend and indemnify the doctor. This avoids the “divide and conquer” strategy favored by plaintiff attorneys. Eli Lilly did this for a while in Prozac(r) litigation, or at least it offered this to doctors sued because of the drug.

One client in the business of producing collagen injections for cosmetic surgery used this in suits alleging auto-immune disorders from collagen injections. There were a few stipulations and conditions, however. First, the doctor had to have used the drug or device in a proper manner. If that did not happen, the protection was negated. Second, in both cases, the drug or device company insisted — as a condition of covering the defense — that it control the defense, the selection of counsel, and the right to defend or settle. This may or may not be a problem for a doctor or his/her malpractice carrier. Also, this gesture may not even be covered under the manufacturer's product liability insurance policy, most of which typically include exclusions for both professional liability and contractual liability. Nevertheless, from a business standpoint, these companies decided it made sense, whether or not their insurance covered it.

Conclusion

When assessing the odds of coordinated defense between physicians and medical technology defendants, it is vital to note that no one suggests that the angels are not exclusively on one side or the other of this relationship. There are cases of genuine medical malpractice. Doubtlessly, there are also cases of genuine product defect. There are also instances where both factors combine to cause or contribute to a medical mishap. In yet other cases, there is no breach of standard of care and no product defect. In the realm of medicine, to paraphrase a popular bumper sticker, “Stuff happens.” Sometimes it happens and no one and no product is at fault.

Orchestrating a successful and aggressive defense among doctors and medical device manufacturers is a daunting professional challenge for even skilled attorneys. Managing a defense without breaking ranks or compromising the strength of the defense may require some fancy tightrope walking. It is not an easy alliance to manage. By using some of these techniques, though, physicians and medical device companies can make the alliance stronger and perhaps even boost the chances of a successful case defense.

“Politics make strange bedfellows” is an election-year maxim. Sometimes, bitter rivals in primaries become allies after a convention, or forge alliances to get favored bills and “pet” proposals approved. But while politics may make strange bedfellows, it has nothing on personal injury litigation.

Perhaps nowhere is this more true than in the realm of medical liability lawsuits involving doctors and medical device companies as co-defendants. The intersection of medical malpractice and product liability litigation often pulls together two distinct but interrelated entities, who can both end up as defendants in complaints incorporating allegations of medical malpractice and product defect. This combination was evident in pedicle or spinal screw litigation, as well as in the breast implant lawsuits. It is also a common feature in litigations involving jaw implants, angioplasty, interventional cardiovascular procedures and ophthalmic surgery.

Device companies and doctors caught in this type of situation can either work together and harmonize … or they can fight like two scorpions in a bottle.

What Causes the Strain?

Let us examine some “context factors” that create tension between doctors and medical device manufacturers. What makes the alliance uneasy?

The Starting Blocks

Physicians and hospitals leave the investigative starting gates faster than device manufacturers. Doctors and hospitals have earlier notice of loss and they know more about the medical mishap, or at least tend to know it sooner. They have first crack at the evidence, while the trail is still warm, before witnesses leave the state or memories fade. They often have the first opportunity to deal with the injured patient and the family — to do “spin control” about how a mishap occurred. They are also in a position to write off bills to appease an upset patient. Doctors and healthcare facilities also often have physical possession of the product, which can be key to an effective defense. They can engage consultants to have the device tested and checked out, giving them an early advantage in launching a successful defense.

The 'Spin Doctor'

Doctors have early contact with patients after a medical mishap. They can offer sympathy. They can explain. They can also point to the device as the culprit that caused the injury, deflecting negative attention away from themselves and toward the device maker. It is often easier to say, “The device malfunctioned,” than to say, “I messed up.” Studies show that a good bedside manner reduces the odds of a doctor getting sued. Medical device companies are by definition corporations and do not have “bedside manners.”

Consent to Settle

Many medical malpractice policies still contain “consent to settle” clauses, which can often complicate settlement and exert pressure on manufacturers to contribute more money. The “consent to settle” issue often affects a doctor's professional pride. Settlements may endanger the doctor's “preferred provider” status. Doctors may take a “no pay” stance at the negotiating table, sometimes even against their own counsel's advice. This can create a situation where extra pressure builds on the device maker to pay more in order to make up the difference. The doctor may even be financially rewarded for intransigence. Insured device companies typically do not have “consent to settle” clauses in their product liability insurance policies. They cannot use this as an impediment against financial participation in settlement.

Caps on Recoveries

Caps on recoveries against doctors and hospitals often make device companies “deep pockets.” Doctors have achieved some success with state law tort reforms that have placed caps on recoveries against doctors or hospitals. This is good news for doctors. By contrast, it is bad news – sometimes – for device companies, which enjoy no such limitation on their liability. If I am a plaintiff's attorney, this may leave the device company as the “deep pocket,” and target defendant. Why? For the same reason Willie Sutton robbed banks: “Cause that's where the money is.”

The National Practitioner Database

The National Practitioner Database often complicates settlement. If a doctor settles, his or her name may enter the National Practitioner Database. He or she may have strong feelings against this and, as a result, refuse to settle. Manufacturers do not have anything like a National Practitioner Database. While they are often emotionally tied to their products and have strong feelings about settlement, they cannot use the Database as a reason to forego settlement. The net effect of this in negotiating dynamics is often to make plaintiffs focus the spotlight on the device company as the target defendant, since the doctor is adamant about refusing to settle due to the Database issue.

Low Insurance Policy Limits

A practitioner's low insurance policy limit can deflect litigation focus away from him or her and toward the manufacturer. Corporations often carry more insurance than do physicians. If a doctor opted for low liability limits, this can draw attention away from the provider and focus it on the “deep pocket” manufacturer. Some doctors think that having insurance coverage makes them a more likely target for suits. Others might think that “going bare” deters suits, since the lawyer or plaintiff won't have a deep pocket to pick. Some doctors may intentionally carry low liability limits because that is all they can afford, or want to buy. Or maybe they just do not think that it is very likely that they will get sued. Device companies can find a cruel irony: Their “reward” for being prudent managers of risk and not under-insuring is to become the target defendant because that is the most promising recovery angle for the plaintiff.

Consider a hypothetical situation where you are a plaintiff's attorney and have a “bad baby” case. You are suing a doctor, who has a $1 million policy, and a fetal monitor manufacturer, which has $10 million in liability coverage. On whom should you focus? This is not an agonizing question for most personal injury professionals.

Product Liability Defenses

Another factor making the alliance uneasy is the state of the law, where certain defenses to product liability claims can also produce friction with co-defendant doctors. Device manufacturers often assert certain theories and defenses, such as: 1) “user error” – where the MD disregarded warnings or used poor technique; 2) poor patient selection; 3) lack of informed consent; or 4) the learned intermediary defense.

The Good Neighbor

Manufacturers are often faceless/ bloodless entities with no local or community presence. By contrast, the doctor or hospital likely has roots in the community where the suit arises.

These are factors causing friction between doctors and device companies in liability claims and litigation. This friction tends to benefit the plaintiff, may inflame a jury and may elevate awards and settlements. Physicians and device firms fighting each other can win the “battle” but lose the “war.” Such “victory” may be Pyrrhic. In foreign policy nomenclature, especially discussions regarding nuclear weaponry, there is an acronym, “MAD,” which stands for “mutually assured destruction.” One could call internecine fighting between doctors and device firms a “Kevorkian strategy” in litigation. There are few pat answers, but let us examine some possible approaches and remedies.

Strategies for Defense Coordination

The doctor often claims the product was defective because it broke or malfunctioned. The device maker claims the doctor over-torqued the device, used it inappropriately, failed to get informed consent, or used sloppy technique. If I am a plaintiff attorney, this is a promising litigation scenario. The defendants are making my case for me. The jury will have a relatively simple choice: They know the plaintiff is blameless, now, it is just a question of which defendant is going to pay, or if both of them will. The plaintiff attorney can play the device company against the doctor, or the doctor against the device maker. The plaintiff's attorney is the chief beneficiary when co-defendants snipe at each other.

The single most important step in avoiding infighting among defendants is early communication among all parties. A “meet and confer” session shortly after suit is filed can yield benefits. Try to establish rapport with co-defendants. Forge an alliance or an agreement to disagree — but only after the fact.

A fall-back option is to forge a mutual non-aggression pact. Agree that there will be no cross-complaints among the doctor, hospital and device manufacturer. Once aggressive in-fighting starts, it is very hard to put the genie back in the bottle. Eschew finger-pointing, at least until the facts are in. Here, any sniping is deferred till discovery is finished and you have a clearer picture as to whether the injury was caused by a defective product, by medical malpractice, a combination of the two or none of the above.

Admittedly, there are problems and challenges with this approach:

• First, it consumes a lot of time, money and requires much self-restraint;
• Second, even after considerable discovery, it is possible that no clear picture will emerge, or the facts may point to a blend of product defect and medical malpractice; and
• Third, it may only delay the warfare, which, when it eventually erupts, still benefits the plaintiff.

It is a sub-optimal solution, but is still better than “pitched warfare” right out of the starting blocks.

Another fall-back option is to get agreement that, if a united defense is no longer possible, the respective co-defendants will be the first to know. This avoids the specter of anyone getting “blind-sided” or hit with nasty surprises. Moral: Agree to share information with each other. Another key consideration is to assess and weigh the doctor's role and relationship with the manufacturer. Sometimes the doctor may be a key customer. There may be business reasons why the device company does not want to “point fingers” at the doctor or hospital.

Does the doctor do any training on the product? If not, there may be a better chance that the mishap was due to his or her lack of training or unfamiliarity with the device. Many studies have shown that for certain procedures involving medical equipment, training and experience are key determinants of patient outcomes. That is certainly the case in angioplasty procedures, for example. Another question to ask: “Is the doctor an investor in the device company or have any financial ties through royalties or licensing agreements? These are increasingly open to scrutiny on conflict of interest grounds.

Stipulating to Liability and Trying the Case on the Issue of Damages

In cases of a clear error in physician judgment or technique, consider stipulating to liability and limiting trial to damages alone. Defendants can agree that stipulating to liability for trial purposes will not bind any of them to admitting liability for arbitration purposes. This offers the prospect of limiting damages by keeping evidence of certain defendant's conduct away from the jury. Often, defendants can agree that inter-defendant finger pointing only inflames jury sympathy for a badly hurt plaintiff.

For example, Medmarc Insurance recently defended a lawsuit involving a catheter. The device developed a hole, causing a premature infant to exsanguinate during surgery. The hospital, the resident, the anesthesiologist, the surgeon and the catheter maker were all sued. At the outset, respective defense counsel met and decided that finger pointing would hurt all the defendants and help the plaintiff. Defendants agreed informally to not affirmatively help the plaintiff. But, this was not done at the expense of individual clients. Counsel avoided blaming other defendants but — if bad facts arose — so be it. Fortunately, all defense counsel were experienced. No one deviated from the informal agreement. Collectively, the case was settled for a relatively reasonable amount.

Admittedly, and unfortunately, a united defense is not possible all the time. A doctor or device manufacturer with the lion's share of liability may settle for a pittance and get a “good faith” settlement, thereby barring any later cross-complaints. Often, this provides “seed money” for the plaintiff's lawsuit against the remaining co-defendant(s) with a lesser or no degree of fault, who could still be tagged at trial by a sympathetic jury in a verdict that is “joint, several” and substantial.

Another — creative but somewhat more radical — solution is for the device company to agree to defend and indemnify the doctor. This avoids the “divide and conquer” strategy favored by plaintiff attorneys. Eli Lilly did this for a while in Prozac(r) litigation, or at least it offered this to doctors sued because of the drug.

One client in the business of producing collagen injections for cosmetic surgery used this in suits alleging auto-immune disorders from collagen injections. There were a few stipulations and conditions, however. First, the doctor had to have used the drug or device in a proper manner. If that did not happen, the protection was negated. Second, in both cases, the drug or device company insisted — as a condition of covering the defense — that it control the defense, the selection of counsel, and the right to defend or settle. This may or may not be a problem for a doctor or his/her malpractice carrier. Also, this gesture may not even be covered under the manufacturer's product liability insurance policy, most of which typically include exclusions for both professional liability and contractual liability. Nevertheless, from a business standpoint, these companies decided it made sense, whether or not their insurance covered it.

Conclusion

When assessing the odds of coordinated defense between physicians and medical technology defendants, it is vital to note that no one suggests that the angels are not exclusively on one side or the other of this relationship. There are cases of genuine medical malpractice. Doubtlessly, there are also cases of genuine product defect. There are also instances where both factors combine to cause or contribute to a medical mishap. In yet other cases, there is no breach of standard of care and no product defect. In the realm of medicine, to paraphrase a popular bumper sticker, “Stuff happens.” Sometimes it happens and no one and no product is at fault.

Orchestrating a successful and aggressive defense among doctors and medical device manufacturers is a daunting professional challenge for even skilled attorneys. Managing a defense without breaking ranks or compromising the strength of the defense may require some fancy tightrope walking. It is not an easy alliance to manage. By using some of these techniques, though, physicians and medical device companies can make the alliance stronger and perhaps even boost the chances of a successful case defense.