Turner v Bayer Australia Ltd (No 4)
[2023] VSC 107
•7 March 2023
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
GROUP PROCEEDINGS LIST
S ECI 2019 02916
| PATRICE SARAH TURNER | Plaintiff |
| v | |
| BAYER AUSTRALIA LTD (ACN 000 138 714) & ORS | Defendants |
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JUDGE: | KEOGH J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 28 February 2023 |
DATE OF RULING: | 7 March 2023 |
CASE MAY BE CITED AS: | Turner v Bayer Australia Ltd (No 4) |
MEDIUM NEUTRAL CITATION: | [2023] VSC 107 (First revision 6 November 2023) |
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PRACTICE AND PROCEDURE — Summons to strike out defence — Pleadings — State of scientific and technical knowledge defence — Trade Practices Act 1974 (Cth), s 75AK(1)(c) — Competition and Consumer Act 2010 (Cth), Schedule 2, s 142(c) — Merck Sharp & Dohme (Australia) Pty Ltd v Peterson (2011) 196 FCR 145 — Graham Barclay Oysters Pty Ltd v Ryan (2000) 102 FCR 307 — Gill v Ethicon Sàrl & Ors (No 5) [2019] FCA 1905.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | F Forsyth KC with E Levine | Slater & Gordon |
| For the First to Fourth and Sixth Defendants | K Brazenor | Clayton Utz |
| For the Fifth Defendant | N Connell (as solicitor) | Mills Oakley |
HIS HONOUR:
This representative proceeding is a product liability action concerning implanted permanent contraceptive medical devices identified collectively as the Essure device. The plaintiff brings the proceeding on behalf of all women who have had an Essure device implanted and suffered harm as a result. She claims damages for breach of the Australian Consumer Law[1] (‘ACL’) and Trade Practices Act 1974 (Cth)[2] (‘TPA’), and in negligence based on allegations of defective design and failure to warn.
[1]Competition and Consumer Act 2010 (Cth), sch 2.
[2]Trade Practices Act 1974 (Cth).
The proceeding is listed for trial on an estimate of 12 weeks commencing on 11 April 2023.
One of the claims made by the plaintiff is that the Essure device had a defect within the meaning of s 75AC of the TPA and/or a safety defect within the meaning of s 9 of the ACL.
The first to fourth and sixth defendants (‘Bayer and AMSL defendants’) and the fifth defendant plead the defence in s 75AK(1)(c) of the TPA and s 142(c) of the ACL (‘state of scientific knowledge defence’). On 9 February 2023, I made orders requiring the defendants to provide further particulars of that defence.
The plaintiff has applied to strike out the state of scientific knowledge defence on grounds that the defendants’ pleadings do not disclose a defence and/or that the pleading may prejudice, embarrass or delay the trial of the proceeding.
Procedural history
The writ commencing the proceeding was filed by the plaintiff on 28 June 2019.
The plaintiff filed a statement of claim on 20 December 2019, and an amended statement of claim (‘ASOC’) on 23 December 2022.
The Bayer and AMSL defendants filed their defence on 11 September 2020.
The fifth defendant filed its defence on 15 September 2020.
The plaintiff served extensive further and better particulars to her statement of claim on 16 December 2022.
On 9 February 2023, I ordered all of the defendants to provide further and better particulars of the state of scientific knowledge defence.
By letter to the plaintiff dated 17 February 2023, the Bayer and AMSL defendants provided further and better particulars.
On 27 February 2023, the plaintiff filed a summons seeking to strike out paragraph 59(c)(ii) of the Bayer and AMSL defendants’ defence, and paragraph 59(a)(ii) of the fifth defendant’s defence.
On 27 February 2023, the Bayer and AMSL defendants filed submissions which included further particularisation of the defence in paragraph 59(c)(ii).
Statutory provisions
For the purpose of this application, there is no material difference between the ACL and TPA provisions.
The meaning of safety defect is governed by s 9 of the ACL:
(1) For the purposes of this Schedule, goods have a safety defect if their safety is not such as persons generally are entitled to expect.
(2) In determining the extent of the safety of goods, regard is to be given to all relevant circumstances, including:
(a) the manner in which, and the purposes for which, they have been marketed; and
(b) their packaging; and
(c) the use of any mark in relation to them; and
(d) any instructions for, or warnings with respect to, doing, or refraining from doing, anything with or in relation to them; and
(e) what might reasonably be expected to be done with or in relation to them; and
(f) the time when they were supplied by their manufacturer.
The plaintiff brings an action under s 138 of the ACL:
138 Liability for loss or damage suffered by an injured individual
(1) A manufacturer of goods is liable to compensate an individual if:
(a) the manufacturer supplies the goods in trade or commerce; and
(b) the goods have a safety defect; and
(c) the individual suffers injuries because of the safety defect.
The pleaded defence relevant to this application relies on s 142(c) of the ACL:
In a defective goods action, it is a defence if it is established that:
…
(c) the state of scientific or technical knowledge at the time when the goods were supplied by their manufacturer was not such as to enable that safety defect to be discovered;
An equivalent defence is found in s 75AK(1)(c) of the TPA.
It is useful to consider three cases in which the defence has been made out. First, the decision on appeal in Merck Sharp & Dohme (Australia) Pty Ltd v Peterson (‘Merck’)[3] concerned an action against the suppliers of the anti-inflammatory medication Vioxx. The trial judge’s finding that Vioxx had a defect within the meaning of the TPA was confirmed on appeal:
Notwithstanding these difficulties, the better view is that Vioxx had a defect within the meaning of s 75AC. The defect was one which affected some people, not all. The defect was that in some people, by a mechanism not known and the subject of no hypothesis, it increased the risk of [myocardial infarction] and provided no information, advice or warning as to this effect …[4]
[3](2011) 196 FCR 145 (Keane CJ, Bennett and Gordon JJ).
[4]Ibid 200–201 [201].
The Court adopted the following description of the state of scientific knowledge defence:
It is the objective state of scientific and technical knowledge, not the subjective knowledge of the individual manufacturer, which is to be taken into account. It is only if the defect could not have been discovered by anybody that the manufacturer will be able to succeed. A manufacturer must expect that there may be further scientific or technical advances during the period of testing and production. The manufacturer should therefore satisfy itself that there have been no further technical advances which affect the safety of the goods before putting them into circulation.
Similarly, a manufacturer must keep up to date with advances in knowledge after it first puts a product into circulation to ensure that new information is taken into account in the manufacture of subsequent goods, as new information may expose defects in goods. The crucial time is therefore when the alleged defective good which caused the injury was supplied by the manufacturer, not the time at which the manufacturer first supplied goods of that type.[5]
[5]Ibid 201 [204].
In Merck, a study was released during the period of supply which raised a suspicion about the existence of the defect in Vioxx. However, the trial judge, and the Court on appeal, concluded that it was not until the end of the supply period, when a study revealed the increased risk of occurrence of cardiovascular events resulting from consumption of Vioxx, that the defect could be discovered according to the state of scientific or technical knowledge.
The second case is Graham Barclay Oysters Pty Ltd v Ryan (‘Oysters’),[6] concerning a claim that oysters supplied for human consumption were defective in that some carried the hepatitis A virus. On appeal, the Court confirmed the trial judge’s conclusion that the defence was made out because the state of scientific and technical knowledge was such that the only effective test for the presence of the virus would destroy the oyster, rendering discovery of the defect and supply mutually exclusive.
[6](2000) 102 FCR 307 (Lee, Lindgren and Kiefel JJ). The reasoning regarding s 75AK(1)(c) of the TPA was not interfered with by the High Court on appeal in Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540.
The third case, Gill v Ethicon Sàrl & Ors (No 5) (‘Gill’),[7] concerned complications suffered by recipients of surgically implanted synthetic mesh designed to treat urinary incontinence or pelvic organ collapse. The applicants pleaded that implantation of the mesh could cause a range of complications in a number of ways. The trial judge accepted evidence about the risk of complications, and on that basis concluded the mesh had a defect. Considering the nature of the state of scientific knowledge defence, Katzmann J said:
[7][2019] FCA 1905.
The clear intention of Parliament was to limit the relevance of any deficiency in the state of scientific or technical knowledge at the time of supply to that which was unable to be discovered and to impose an onus on the manufacturer to prove the deficiency. The onus imposed by s 75AK(1)(c) is a legal onus, not merely an evidentiary one …[8]
Observing that the defence was a very narrow one, Katzmann J continued:
… It is not enough for a manufacturer to prove that it could not reasonably be expected to have discovered the defect; the defect must be one that no-one could have discovered at the time it supplied the goods. Moreover, the relevant time is the time the goods containing the defect were supplied, not the time when goods of that kind were first supplied. …[9]
Dismissing the defence, Katzmann J said:
The respondents’ submissions were weak. They merely emphasised the development of scientific learning. While they could show that with the passage of time there was an increase in knowledge about certain matters, they did not prove that the knowledge could not have been acquired at an earlier point in time. …[10]
[8]Ibid 857 [3358].
[9]Ibid 880 [3504].
[10]Ibid 881 [3506].
Amended statement of claim
At paragraphs 18 to 22 of the ASOC, the plaintiff alleges that insertion of the Essure device caused or gave rise to the risk of what are described as inherent defects, failure defects, adverse events and the removal limitation. In paragraph 23 of the ASOC the plaintiff pleads that she and group members suffered injuries by reason of one or more of the inherent defects, the failure defects and/or the removal limitation and/or the occurrence of one or more of the adverse events. In paragraphs 24 and 25 of the ASOC the plaintiff pleads that the defendants published marketing material relating to the Essure device, directed to potential recipients, that did not adequately disclose the existence of the inherent defects, the failure defects, the risk of adverse events and/or the removal limitation.
The manner in which defects are pleaded by the plaintiff is adequately demonstrated by paragraph 18 of the ASOC:
At all material times, by reason of one or more of the matters alleged in paragraphs 14 to 17, the Essure Insert:
a.disrupted the inner layers of the uterine horn and/or the fallopian tubes;
b.caused initial acute inflammation in the fallopian tubes and/or endometrium;
c.caused ongoing chronic inflammation in the fallopian tubes and/or endometrium; and/or
d. incited a foreign body response to the Essure Insert in the fallopian tubes and/or endometrium and/or uterine cavity
(the Inherent Defects).
The plaintiff has served extensive further particulars of, amongst other things, the inherent defects, the failure defects and the adverse events. For example, the plaintiff pleads that the device ‘caused ongoing chronic inflammation in the fallopian tubes and/or endometrium’, as particulars of the allegation in paragraph 18(c):
As to paragraph 18(c), an ongoing chronic inflammatory response to the Essure Insert occurred by reason of:
(i) the acute inflammatory response not resolving;
(ii) limited biocompatibility in the constituent materials of the Essure Insert hindering the physiological healing process following acute inflammation;
(iii) lack of surface functionalisation of the Essure Insert;
(iv) the metal and synthetic components of the Essure Insert including the mixing of metals of different electrochemical potential;
(v) corrosion and metal ion release;
(vi) micromovements causing ongoing mechanical injury in the tissue of the fallopian tube;
(vii) the Essure Insert not resorbing in the body;
(viii) the Essure Insert not promoting a functional integration with host tissues;
(ix) the propensity of female reproductive tissue and organs towards a pro-inflammatory response; and/or
(x) the interaction of the female reproductive tissue with the Essure Insert as a foreign body and the elicitation of the foreign body response.
For detail see Chrzanowski Primary Report at 1.4, 2.2, 2.3; Robertson Primary Report at paragraphs 49- 75, 108-117.
The plaintiff’s safety defect claim is contained in paragraphs 58 and 59 of the ASOC:
Safety Defect
58. By reason of all or any of the Inherent Defects, the Failure Defects, the Adverse Events and the Removal Limitation, along with the Marketing Conduct, the safety of the Essure Devices acquired by the Plaintiff and group members was not such as persons generally are entitled to expect.
Particulars
(i) The Plaintiff refers to the matters alleged at paragraphs 18 to 25.
(ii) Further particulars may be provided following discovery.
59. By reason of the matters alleged in the preceding paragraph, the Essure Devices had a defect within the meaning of section 75AC of the Trade Practices Act and/or a safety defect within the meaning of section 9 of the Australian Consumer Law.
State of scientific knowledge defence
The Bayer and AMSL defendants plead the state of scientific knowledge defence in paragraph 59(c)(ii):
Allegations concerning defects
59. In response to the allegations contained in paragraph 59, the Defendants:
…
(c) say further that if, which is denied, the Essure Device (in the context of commercial supply to patients in Australia during the Commercial Supply Period) is found to have had a ‘defect’ within the meaning of section 75AC of the TPA and/or a ‘safety defect’ within the meaning of section 9 of the ACL:
…
(ii) further or alternatively, the state of scientific or technical knowledge at the relevant time of supply of the Essure Device was not such as to enable that defect, further or alternatively that safety defect, to be discovered, for the purpose of the defence afforded by s 75AK(1)(c) of the TPA and/or s 142(c) of the ACL.
The fifth defendant has filed the defence in substantially identical terms.
The particulars of the state of scientific knowledge defence served by the Bayer and AMSL defendants:
(a) list the defects pleaded by the plaintiff to which the defence is alleged to apply; and
(b) identify the state of relevant scientific and technical knowledge simply by referring to parts of the expert reports that have been filed and served and to studies, publications and tests identified and discussed in those reports or that have been discovered.
Consideration
The plaintiff submitted that the Bayer and AMSL defendants’ defence does not articulate the technical or scientific knowledge relied on; the state of that knowledge; or how it is said that it was not such as to enable each pleaded defect to be discovered. The plaintiff submitted that the defendants failed to specify whether some or all of the underlying elements or the ultimate conclusion that the device had the alleged defect could not be discovered.
The facts of this case make it unlike Merck and Oysters, but similar in relevant respects to Gill. In Merck and Oysters, there was a single defect in the goods supplied, and a single study or test against which it could be determined whether the state of scientific knowledge enabled the defect to be discovered.
In Gill, there were a range of adverse consequences resulting from the complex physiological reaction of the recipient’s body to implantation of the mesh. The mesh was defective because of the risk of those adverse consequences. The plaintiff in this proceeding puts her case in a similar way. She relies on all or any of the inherent defects, the failure defects, the adverse events and the removal limitation to establish that the Essure device was defective, and that implantation resulted in loss and damage to her and group members. It will be more difficult in such a multifaceted and complex case for a defendant to precisely plead the state of scientific knowledge, and how deficiency in that knowledge resulted in an inability to discover the pleaded defects.
In this case that difficulty is compounded by two matters. First, the defendants deny the existence of the pleaded defects. There is a substantial body of expert evidence relied on by the parties going to the existence of the alleged defects. Second, the plaintiff has particularised numerous potentially interrelated mechanisms that she alleges result in one or more of the pleaded defects. The plaintiff will seek to rely on expert evidence, and scientific reports, studies and data to make out that case. Given the interrelated range of ways in which the plaintiff puts her case, the pleading precision she seeks in relation to the state of scientific knowledge defence may be impossible for the defendants to achieve.
For example, in paragraph 18(c) of the ASOC the plaintiff pleads that the Essure device ‘caused ongoing chronic inflammation in the fallopian tubes and/or endometrium’. The plaintiff’s further and better particulars allege that defect occurred by one or a combination of two or more of ten different means, one of which is ‘micromovements causing ongoing mechanical injury in the tissue of the fallopian tube’. The plaintiff submitted the defendants’ pleadings were inadequate because they did not identify whether the alleged deficiency in scientific knowledge related to the discovery of micromovements, or that micromovements might cause mechanical injury, or that those matters might result in chronic inflammation.
Consideration of the state of scientific knowledge defence is likely to be informed by the mechanisms which the plaintiff alleges resulted in the defect. However, the defence is directed to whether the alleged defect, in this case chronic inflammation, is discoverable on the state of scientific knowledge. I do not accept the plaintiff’s submission that the defendants’ pleading must respond in a granular way to each element of the mechanisms she has particularised as the cause of each pleaded defect.
I accept the plaintiff’s submission that the current pleading of the state of scientific knowledge defence is deficient in two ways. First, the Bayer and AMSL defendants identify in the particulars a range of tests, studies and publications which they submit represent the state of scientific knowledge during the relevant time period. They have not, however, adequately particularised which aspects of this identified ‘state of scientific knowledge’ are directed to each defect the subject of the defence. Second, the Bayer and AMSL defendants have not pleaded how it is that the identified scientific knowledge was not such as to enable the safety defects to be discovered. While I accept, for reasons already stated, that the degree of pleading precision that the plaintiff seeks may be impossible, more needs to be done to address these deficiencies.
I reject the plaintiff’s submission that the state of scientific knowledge defences should be struck out without the right to replead. The pleading has been in existence for a considerable time. The material on which the defendants will rely to replead has been articulated in the recent Bayer and AMSL particulars, and was served or discovered many months ago. The plaintiff has had the opportunity to have her experts respond to the opinions expressed by the defendants’ experts and the material on which they rely in reply reports and joint expert reports following conclaves. It is not apparent that allowing the defendants the opportunity to replead the state of scientific knowledge defence will result in any unfair prejudice to the plaintiff.
Conclusion
I will order that the defendants replead the state of scientific knowledge defence by identifying the scientific or technical knowledge relevant to each defect to which the defence is alleged to apply, and by setting out how or in what way that knowledge was not such as to enable the defect to be discovered.
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