Philips Respironics has seen an onslaught of litigation relating to its continuous positive airway pressure (CPAP) and bilevel positive airway pressure (BiPAP) breathing machines, which it recalled in June 2021. For months following the recall, Philips was inundated with hundreds of consumer class action lawsuits, which were consolidated in a CPAP multidistrict litigation in Autumn 2021 in the US District Court for the Western District of Pennsylvania.
Now, Philips faces off against a different kind of class action plaintiff – medical device suppliers.
In March 2022, Baird Respiratory Therapy, Inc, filed a putative class action lawsuit against Philips in the US District Court for the Eastern District of Pennsylvania, seeking to represent a nationwide class of durable medical equipment suppliers that had purchased Philips's recalled breathing machines.
In Baird Respiratory Therapy, Inc v Philips,(1) Baird alleged that Philips had breached its express warranty and misrepresented the risks inherent in the polyester-based polyurethane (PE-PUR) foam found in the machines, which can potentially cause cancer and other injuries. According to the complaint Philips had "unreasonably delayed its recall" by waiting to notify Baird and other suppliers of reports indicating that the PE-PUR foam could break down and put users in harm's way. Philips had also knowingly allowed its packaging, labels, ads, promotional materials and websites to intentionally mislead Baird and other suppliers about the recalled products. As a result, Baird and other suppliers had lost money when they were unable to resell the recalled CPAP and BiPAP machines.
Baird asserted claims against Philips for breach of express warranty, fraudulent misrepresentation, fraud by omission and unjust enrichment. On behalf of itself and a putative nationwide class of durable medical equipment suppliers, Baird is seeking a declaratory judgment and monetary relief of over $5 million.
This most recent lawsuit illustrates that when a company recalls one of its products, class action plaintiffs can come in all shapes and sizes, and from various stages of the distribution chain. This case is ongoing.
For further information on this topic please contact Rachel Raphael or Lily Hsu at Crowell & Moring LLP by telephone (+1 202 624 2500) or email ([email protected] or [email protected]). The Crowell & Moring LLP website can be accessed at www.crowell.com.