On September 5, 2007, the Ontario Superior Court of Justice released its decision in Taylor v. Canada (Health), certifying a class action that alleges that Health Canada was negligent in that it failed to exercise its powers and responsibilities under the Food and Drugs Act. This is the first successful certification of a class action relating to Health Canada’s role under the Food and Drugs Act with respect to medical devices and represents an important development in both class action and medical device liability litigation. It is also interesting in that the action was brought against Health Canada after a class action against the distributor of the allegedly defective device had been settled.
Starting in 1983, certain medical devices sold in Canada required a Notice of Compliance to be obtained from Health Canada. Vitek Inc., a US corporation, had been manufacturing and selling various jaw implants since 1968. In May 1983, Vitek informed Health Canada that it intended to export the implants to Canada. Vitek never obtained a Notice of Compliance from Health Canada.
In 1988 the representative plaintiff, Kathryn Anne Taylor, received a Vitek implant. She claimed that the implant deteriorated, causing her significant injuries, which she attributed to the negligence of Health Canada. Ms. Taylor alleged that Health Canada had failed to exercise its powers pursuant to the Food and Drugs Act and was or ought to have been aware that the implants were prone to mechanical deterioration and disintegration, causing severe and potentially catastrophic reactions when used.
In particular, Ms. Taylor alleged that:
- Health Canada knew that no Notice of Compliance had been issued to Vitek for the implants;
- Health Canada was aware that the distributor was continuing to distribute the implants despite not having received a Notice of Compliance;
- After a request for a Notice of Compliance was rejected, Health Canada initially took no steps to intervene; and
- Health Canada took no action when its written requests for compliance were ignored.
It was also alleged that, in 1988, Health Canada erroneously recorded in its database that a Notice of Compliance had been issued and, when it discovered the error, took no steps to inform medical professionals of the error. At the same time it was alleged that Health Canada had received numerous reports from health authorities in the United States that the implants were generally unsafe.
OVERVIEW OF THE DECISION
Under Ontario’s Class Proceedings Act, an action cannot proceed as a class action until it has been certified by the Court. The test for certification under the Class Proceedings Act has several elements, one of which is disclosure of a cause of action. In essence, if it is “plain and obvious” that the cause of action alleged by the representative plaintiff is untenable at law, then the class action should not be certified.
As recently as July 2007, the Ontario Superior Court of Justice had decided not to certify a similar class action, R. v. Drady. The Court held that the duty of care that might exist between Health Canada and recipients of a product to which Health Canada’s conduct related did not extend to a person who did not receive the specific product, such as Mr. Drady. Ms. Taylor’s case was quite different however, in that it was alleged she had received the device in question.
In determining if Health Canada, in exercising its statutory powers, could be found to owe a private law duty of care to Ms. Taylor, Justice Cullity first looked to the relevant statutory provisions, the Food and Drugs Act. Although no provisions in the Food and Drugs Act impose public or private duties on Health Canada, the related regulations have required since 1983 that certain devices sold in Canada (including the device implanted in Ms. Taylor’s jaw) obtain a Notice of Compliance. Justice Cullity held that it was therefore incumbent upon Health Canada to enforce this requirement by ensuring that all devices meet the necessary statutory standards. The Food and Drugs Act confers upon Health Canada the necessary powers to enforce compliance by importers, vendors and distributors with respect to the import and sale of medical devices.
Justice Cullity stated that where Health Canada takes steps to implement the policies in the Food and Drugs Act in a purported exercise of its statutory powers, it is acting operationally and could be liable for the manner in which it executes or carries out the policy. In other words, once Health Canada decides to implement a particular policy, at law it can be held liable for not properly executing the policy. In particular, a failure to exercise discretion which creates, enhances, or contributes to a risk of harm to a specific group of individuals may create the necessary proximity to impose a private law duty of care. Justice Cullity noted that from 1983 to 1994, Health Canada failed to enforce its own policy regarding Notices of Compliance and thereby established the requisite proximity with the private individuals who received the implants.
Justice Cullity’s judgment on certification is not a decision on the merits, and therefore further guidance as to the scope of Health Canada’s duties will likely be forthcoming as the case proceeds. Interestingly, however, Justice Cullity rejected Health Canada’s assertions that finding for Ms. Taylor could expose the government to a torrent of litigation. He noted that in the unique circumstances of this case, the question of proximity should be left to trial, and that, given the particular facts of Ms. Taylor’s claim, the spectre of unlimited liability, interference with the policy decisions of government and massive litigation seemed fanciful. He also left to trial broader policy considerations raised by Health Canada, expressing the opinion that they could not properly be evaluated on the basis of the Statement of Claim alone.
While this case presents some unique facts, it reflects an important trend in class action litigation relating to pharmaceutical and medical device liability as plaintiffs seek to bring claims against Health Canada with respect to its role as the regulator of medical devices and pharmaceutical products.