More Medical Monitoring Claims

And Impacts Of REACH Regulations

For Chemicals
Two topics this month:
a new legal journal article reflecting technology
advances that may lead to resurgence of medical
monitoring claims, and
the EU's REACH regulations applicable to chemi-
cals in goods imported into the EU, the EU's
wide-ranging regulations will cause more public
disclosure of scientific data and there are impor-
tant, impending deadlines for companies to regis-
ter under REACH.
Resurgence of Medical Monitoring Claims
On the rapid pace of scientific advances causing
changes in litigation claiming tactics and substantive rules,
an interesting and brief new article is titled Medical
Monitoring Utigation: lnffuence of Evolving Diagnostic
Technologies. The article
appears in the August 2008
issue of For the Defense, a
monthly publication by the
Defense Research Institute, which is a professional group
composed mainly of lawyers who work for insurers
and/or corporations with tort litigation issues. The article
is interesting for both its substance and the authors-
both are non-lawyers, and one is a physician/PhD/acade-
mic with many years of background in basic medical
research. In addition, the authors probably cannot be
considered "left wing tree hugger alarmists" since their
employer describes itself as working for "industry"
(www.weinberggroup.com), and other sources collect
web links related to claims that their employer has "bent"
science to support work for tobacco companies and
others. See generally http://en.wikipedia.org/wiki/
Weinberg_ Group
The Medical Monitonng article provides some concrete
examples of diagnostic changes it characterizes as part of
"diagnostic technologies hav[ing] entered an accelerated
phase of technical improvement" For example, they
November 2008 CORPORATE COUNSEL
describe new advanced brain scans being used to support
or contradict claims of manganism in welders by showing
regions of the brain said to be effected. They also
describe strides in individual genomics that may make it
possible for some specific groups of persons to establish
for condition X that they have an increased relative risk in
excess of the 20 hurdle used by courts in some states
(e.g., Texas) as a threshold for recovery in tort.
A Dramatic Example of New Science
One other example from the article seemed especially
dramatic. The article describes studies and papers indicat-
ing that CT scans can now find tiny lung nodules (in
essence, tiny "tumors" of less than ~ inch), and reports
that the CT technology was applied in a recent study of
I ,000 "healthy" people. The study found over 2,000 tiny
lung nodules. The net result of that study from the per-
spective of the \,000 persons who were studied? The
article says, in pertinent part:
"whereas 25 cases of early lung tumor were detected
and believed cured by surgical resection [removal], 98
percent of nodules turned out to be benign."
That's a dramatic result when one looks at the 25
people, and assumes that the removal of the lung nodule
actually worked a "cure." Indeed, any rational judge
(or other person) would be at least interested in what
would appear to be an opportunity to save 25 lives.
Future Possibilities
The article and the scientific advances they describe
provide yet more grist for debate about what the
future will bring in terms of societies, lawyers and
judges dealing with "risks" and "markers." I do not
claim to know "the answer" (other than to urge that
effective answers probably will arise only when sod
eties move beyond the polarizing extremes arid
processes identified and critiqued in Robert Reich's
excellent book, SuperCapitalism). One can, however,
try to evaluate the future by looking at past approaches
and how well they may play out in the future.
Lawsuits Against Employers: Blaming and suing
employer entities will continue to work for a while, but
its long-term future seems limited. Why? Little employ-
ers lack the money or insurance assets needed to pay
for costly after the fact medical programs. Also, large,
global employers are using various techniques to move
away from providing meaningful medical benefits at all,
or they sometimes transfer the risks to governments
and taxpayers through bankruptcies that permanently
discharge obligations for medical care for retirees.
And, transactions now are growing in which corporate
entities contract to have insurers or others take on the
financial risks associated with former
employees; in the case of Cable and Wireless, some $1
billion of pension obligations were transferred to an
insurer. http://business.timesonline.co.ukltol/business/
industry _sectors/telecoms/article4669872.ece.
Money From Old Insurance Policies: Another
past favorite has been to generate funds for medical
care through law suits involving old insurance policies.
This tactic will continue to work for awhile, but the
horizon also is limited because by the 1970s and
then again in the 1980s, insurers sought to limit their
losses by adding lots of policy exclusions that seek to
bar coverage for different types of pollution and/or
resulting damages. Insurers also raised premiums and
limited coverage amounts to the point that many large
entities became self-insured. In addition, well over a
hundred insurers have exited or limited their prior
insurance obligations by implementing "schemes of
arrangement" under UK law and more will do the
same. (See http://brsuk.pwc.com/solvent.asp).
Manufacturers. REACH and Information:
Another favorite "past" approach has been suing manufac-
turers and distributors for money damages when health
problems emerge long after a product was sold. Many
more of these suits seem inevitable, but new twists may
well apply. Blaming "manufacturers" through failure to
warn lawsuits may not work as well tomorrow as it does
today because in the information ages of today and tomor-
row, insurers, regulators/government and trade unions
are close to if not at the point of having access to or actu-
ally having as much medical and scientific knowledgeable as
does "industry." And, even that gap may start to close as
the EU's wide-ranging REACH regulations take effect.
Over time, the REACH regulations require "industry" to
turn over to "government" all available information on
health studies and health effects of chemicals. Of course,
it will take time to bring that command to fruition. On
the other hand, the new public disclosures also may well
hurt manufacturers by prompting new claims of adverse
health impacts from use of chemicals.
Reminder- December I, 2008 Pre-Registration
Deadline for REACH
To close, a friendly reminder. For many manufactur-
ers and others selling goods into the EU, December I is
the first major deadline for action under the wide-ranging
REACH regulations. REACH is not just for "chemical
companies." REACH instead applies far more broadly to
finished goods in which "substances" are used and are
involved in chemical reactions. The ECHA agency says
that REACH includes, for example, candles or incense
because fire involves a chemical reaction. http:!/echa.
europa.eu/dodREACH_Industry.pdf (brochure on when
registration is needed).
Meeting the December I deadline is important
because complying with the deadline eases the future path
for complying with REACH regulations. December I is
the date by which entities are to register an EU represen-
tative authorized to receive legal notices and other com-
munications sent by the EU itself. So, the process is in
some ways akin to appointing an agent for service of
process, but in other ways the process is more complex.
Law firms are offering to handle the registration process
and to serve as the agent. See generally http://www.avo-
cado-law.com/fileadmin/avocado-law.deidownloads/
Gerhold_and_Roeder_on_REACH-I.pdf. The ECHA
agency also has website with vast amounts of information
on REACH in many languages. http://echa.europa.eu/
Kirk T. Hartley is a partner at Butler Rubin Saltarelli &
Boyd llP, o Chicago litigation boutique. He is the choir o(
the firm's Moss Tort and Products Uability practice group.
The views expressed are personal to the author.
BUTlER RUBIN
excellence in litigation'
CORPORATE COUNSEL November 2008