DePuy Implants, Australian Consumer Law - Assignment Example

Commercial Law Name: Institution: Date: Question One Johnson & Johnson through its subsidiary DePuy Orthopaedics have a liability in the tort of negligence in the manufacture and distribution of ASR hip replacement. The manufacturers breached their role of duty of care because they failed to act reasonably and failed in the fulfillment of their duty and they went ahead to vigorously market and promote DePuy Implants despite knowing complications that the devices caused. DePuy launched the implant device into the market in 2005 without clinical clearance. The company only depended on being cleared by the US Food and Drug Administration (FDA). Within a span of three years FDA had received over 300 complaints all about early failure of ASR hip device. Unfortunately, despite reports of injury with the use of the hip device, the manufacturing company failed to tell patients and doctors the underlying risks that came with the device and delayed in issued a recall directive until 2009 (Latimer, 2012). The manufacturer issued a recall notice owing to high rate of failure of the device. The tort of negligence is applicable in this case since the clients were misled retrogressively. The device design made it very difficult for surgeons to carry out the implant resulting in improper fusing the bone as well as the loose implants. Abrasion from the metal located on the metal socket created metal debris or shavings within the soft tissue around the device resulting into inflammation, pain and tissue death or necrosis. The inflammation and damage cause severe pain as well as disability which could be irreversible and force future surgery for replacement. The refusal by the company not use a toxicologist was suspect. The manufacturers feared their acts of negligence would be exposed. The company must have known the problems with the device way back in 2007 and kept the information secret (Latimer, 2012). The company grappled to manage perception instead of addressing the real problem faced by the product in the market. The cover up by the company is suspect and unscrupulous to its clients. The manufacturer was replacing the defaulted devices instead of recalling them. They did not admit that the device was defective. To make matters worse the implants were made outside their recommended specification. The manufacturing companies failed to warn the clients of the increased risk of the complications of using the hip implant. The negligence of the manufacturers caused harm to the unsuspecting clients. The manufacturers ignored making the implants risk-free to their clients during their use and the devices had to be fit for the intended use. The manufacturers ignored to satisfactory to carry out clinical trials of the implants hence concealing the amount of risks involved in the course of their use (Delaney, 2008). The manufacturers misinformed the public about the safety of the device and went ahead to carry out a vigorous marketing campaign to create consumer awareness of the product. The negligence by the manufacturers is unbelievable. The physicians were given incomplete information about the implants and instead individually blamed for any cases of failure of ASR replacement or resurfacing. The company went against the principles of best practice by hoodwinking the clients and trying to blame individual doctors for failure of the implants. A study carried out in the United Kingdom showed the defective nature of the hip implants. Faulty hip replacement was found to be the cause of inflammation, swelling, severe pain, genotoxicity as well as cancer causing injury. A reduced capacity of the immune system increased the severity and rate of infection apart from becoming less infective in keeping the cancer cells at bay. The company is liable to the tort of negligence to The Australia users of the implant devices considering the massive information concealment that they tried to do. Moreover, they tried to beat a haste retreat from the Australian market. The company Johnson & Johnson together with its subsidiary DePuy Orthopedics, Inc. reached a decision to recall ninety-three thousand hip implant devices comprising of ASR Hip Resurfacing System and ASR XL Acetabular System. The two devices have a high rate of failure. Internal documents obtained from Johnson & Johnson indicate that 37% of the ASR hips failure after a period of about 4.6 years. The rate of failure in Australia was established to be 44% over a seven year time frame (Delaney, 2008). In circumstances where one party owes the other a duty of care, negligence refers to failing to do or doing something that a reasonable person would not, or would do and which results in harm, injury or loss to the other person. Depuy implants manufacturers did not warn their clients of the potential risks of the devices but instead continued to market them as safe and suitable. The companies owed the Australian users a duty of care (Thampapillai et al, 2015). Through buying the hip implants the users had a contract with the manufacturers. The manufacturers of DePuy Implants vigorously marketed them as having numerous advantages as compared to other resurfacing and replacement systems. The DePuy implants were represented in the market as being safe, suitable, having high performance, and effective. This was complete misleading the customers in buying implants that had adverse health risks including chances of developing cancer. The manufacturers knew beforehand that the implants were failing as well as causing pain to clients but instead continued to market them aggressively across Australia. The manufacturers breached their care duty to the clients through misinformation and presenting the product falsely. The hip implants were manufactured outside the recommended specification making it possible to eat up the hip bones. The clients suffered injury, pain and were at risk of developing cancer owing to the breach of duty of care by the manufactures (Gibson & Fraser, 2014). The manufacturers are liable under the tort of negligence. The ASR users have rights in the tort of negligence against the manufacturers of the hip implants. The manufacturers breached their contract to the ASR users by not considering their welfare, health and providing misleading information in advertising the devices. Question two The Wrongs Act is the main statute providing guidance for claims for damages for economic as well as non-economic loss as result of personal injury and death in Victoria. The Act describes personal injury damages as those damages that relate to the injury or death of a person caused by another individual. Damages comprise of any form of monetary compensation. Compensatory damages have to be assessed in reference to the current tort principles. The courts have the mandate of awarding compensatory damages for loss suffered by the complainant. The damages include emotional distress. The compensatory injury damages was applied in the Livingston v Raywards Coal Company. The fundamental principle used in courts is the award of damages for personal injury as referred to as compensatory principle (Delaney, 2008). The damages are normally awarded for non-economic loss in case damages and economic loss where there are special damages. The Wrongs Act refers to legislative intervention within the common law of tort where the law of negligence is the major tort. The damages awarded to the claimant have to be awarded once and forever in lump sum as opposed to being awarded in form of periodic payments. The purpose of the tort of damages is to compensate the claimant for a measurable loss that was incurred. The sum of money awarded for damages should nearly as possible to put the injured person in the same position prior to the injury. The complainant has to be placed in the same position before tort had been committed. Damages have to be awarded in regard to the tort of negligence. The aim is awarding damages to restore the injured person in the same position as he would be had the tort not been committed. The claimant has to be restored to his pre-incident state. Personal injury damages are the damages that relate to the death or injury to a person caused by the negligence of another person (Latimer, 2012). The non-economic loss refers to pain and suffering or loss of enjoyment of life or loss of amenities of life. A discount rate can be applied to consider the inflation rate in order to restore the claimant to where he was prior to the injury. Common law claim for compensation for loss, injury and damage attributed to injury to the person due to the negligence or breach of contract of the statutory duty. The majority of personal injury claims as a result of negligence as is the case of DePuy implants. There ASR users who were affected by the implants were unable to perform their normal chores prior to the injury caused (Gibson & Fraser, 2014). Damages have to be awarded to restore the injured person to the same position to before sustaining the injury. The economic loss that the ASR users suffered after being fit with the implant has to be factored in. the ASR users might have been involved in economic activities prior to being fit with the hip implants. The implants affected their source of livelihood and caused physical discomfort to them. Calculating for damages has to restore the ASR users to where they were prior to the fitting of the devices and cater for all costs including medical costs incurred by the complainants (Latimer, 2012). The ASR users will require reconstructive surgery to restore them to their previous position prior to the injury. The users have been adversely affected by the implants to an extent that they cannot enjoy their daily life. Pain and discomfort has been part of their daily struggle hence causing emotional stress. Question three Australian Consumer Law (ACL) Part 3-5 makes manufacturers to be directly liable for certain losses caused by products that are defective. The term manufacturer under this act is broadly defined include both the actual manufacturers and certain entities who are deemed manufacturers for purposes of this Act (Carroll & Witzleb, 2011). The manufacturer comprises of a person who produces goods or holds himself out as being a manufacturer of goods. Johnson & Johnson through its wholly owned subsidiary DePuy were responsible for the manufacturing and distribution of the defective hip implants that caused a lot of pain and misery to the clients. The ACL apply to consumer goods. Part 3-4 applies to consumer goods or the suppliers of consumer goods. Consumer goods refer to the goods that goods intended to be used or likely to be used for personal, household or domestic consumption or use where a recall action has happened. The term likely has been used in Australian courts to mean anything that is a significant finite probability or a chance that is real as opposed to probable than not (Barnett & Sirko, 2014). In Australia the ASR hip recall happened and that makes the ASR users in Australia able to use the ACL Part 3-5 to apply the Act in claiming for damages. The Australian users of the ASR have the right to bring into application the Australian Consumer Law cause of action following Part 3-5. The hip implants were recalled because of massive failure when used. There is no upper monetary limit in definition of consumer goods. Furthermore, the manufacturers are liable in the many that the represented the goods to the clients through advertising. The goods were advertised and marketed in a manner to suggest that they were safe and suitable for use and there were no health complications involved. The manufacturers aggressively advertised as fit for use despite having health risks that adversely affected the clients. The manufacturers are liable for deceptive and misleading conduct. Instead of the manufacturers taking the blame, they shifted it to the individual surgeons who fitted the hip implants. Misleading the clients through the advertisements was errors and the manufacturers have to be held responsible for their actions. The clients were misled by the company into buying hip implants that were defective and carrying health risks that caused a financial burden to the users apart from the physical distress (Delaney, 2008). The users can apply Part 3-5 of Australian Consumer Law to claim for damages for the economic and non-economic costs incurred. References Barnett, K., & Sirko, H. (2014). Remedies in Australian Private Law, Cambridge: Cambridge University Press. Carroll, R. & Witzleb, N. (2011). It’s Not Just about the Money: Enhancing the Vindicatory Effect of Private Law Remedies, Monash University Law Review 37: 216-219. Delaney, C. (2008). Making a difference: incorporating theories of autonomy into models of informed consent, Journal of Medical Ethics 34(9): 3 Gibson, A., & Fraser, D. (2014). Business Law, Melbourne: Pearson Higher Education AU, 2013 Latimer, P. (2012). Australian Business Law 2012, CCH Australia Limited. Thampapillai, D., Vivi, Tan, Bozzi, C., Matthew, A. (2015). 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