Business Law 13th Edition by Frank Cross, Kenneth Clarkson, Roger LeRoy Miller

Exercise 3

Company Profile Wyeth, LLC-a subsidiary of Pfizer, Inc.-is an international pharmaceutical and health-care company with its corporate headquarters in Madison, New Jersey. Wyeth develops, makes, and markets medical therapies, clinical programs, nutritional supplements, prescription drugs, and other health-care products, including over-the-counter medications. Wyeth was incorporated in 1926. In 1994, the company bought Lederle Laboratories. Since 1948, Lederle had been making the diphtheria, tetanus, and pertussis (DTP) vaccine for children.
Background and facts?When Hannah Bruesewitz was six months old, her pediatrician administered a dose of the DTP vaccine according to the Centers for Disease Control's recommended childhood immunization schedule. Within twenty-four hours, Hannah began to experience seizures. She suffered more than one hundred seizures during the next month. Her doctors diagnosed her with "residual seizure disorder" and "developmental delay." Hannah's parents, Russell and Robalee Bruesewitz, filed a claim for relief in the U.S. Court of Federal Claims under the National Childhood Vaccine Injury Act (NCVIA) of 1986, which set up a no-fault compensation program for persons injured by vaccines. The claim was denied. The Bruesewitzes then filed a suit in a state court against Wyeth, LLC, the maker of the vaccine, alleging strict product liability. The suit was moved to a federal district court, which held that the claim was preempted by the NCVIA, which includes provisions protecting manufacturers from liability for "a vaccine's unavoidable, adverse side effects." The U.S. Court of Appeals for the Third Circuit affirmed the district court's judgment. The Bruesewitzes appealed to the United States Supreme Court.
in the Language of the court
Justice scalia delivered the opinion of the Court.
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In the 1970's and 1980's vaccines became, one might say, victims of their own success. They had been so effective in preventing infectious diseases that the public became much less alarmed at the threat of those diseases, and much more concerned with the risk of injury from the vaccines themselves. Much of the concern centered around vaccines against * * * DTP, which were blamed for children's disabilities * * *. This led to a massive increase in vaccine-related tort litigation. * * * This destabilized the DTP vaccine market, causing two of the three domestic manufacturers to withdraw. * * * * To stabilize the vaccine market and facilitate compensation, Congress enacted the NCVIA in 1986. The Act establishes a no-fault compensation program designed to work faster and with greater ease than the civil tort system. A person injured by a vaccine, or his legal guardian, may file a petition for compensation in the United States Court of Federal Claims.
* * * Successful claimants receive compensation for medical, rehabilitation, counseling, special education, and vocational training expenses; diminished earning capacity; pain and suffering; and $250,000 for vaccine-related deaths. Attorney's fees are provided * * *. These awards are paid out of a fund created by a * * * tax on each vaccine dose.
The quid pro quo [something done in exchange] for this, designed to stabilize the vaccine market, was the provision of significant tort-liability protections for vaccine manufacturers. * * * Manufacturers are generally immunized from liability * * * if they have complied with all regulatory requirements * * *. * * * And most relevant to the present case, the Act expressly eliminates liability for a vaccine's unavoidable, adverse side effects. [Emphasis added.]
* * * * The Act's structural quid pro quo leads to the * * * conclusion: The vaccine manufacturers fund from their sales an informal, efficient compensation program for vaccine injuries; in exchange they avoid costly tort litigation.
Decision and remedy The United States Supreme Court affirmed the lower court's judgment. The NCVIA preempted the Bruesewitzes' claim against Wyeth for compensation for the injury to their daughter caused by the DTP vaccine's side effects. The Court found that the NCVIA's compensation program strikes a balance between paying victims harmed by vaccines and protecting the vaccine industry from collapsing under the costs of tort liability.
THe economic dimension?What is the public policy expressed by the provisions of the NCVIA?
THe political dimension?If the public wants to change the policy outlined in this case, which branch of the government-and at what level-should be lobbied to make the change? Explain.