Hospitals in Oregon are Now Topic to Strict Legal responsibility as Sellers

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When you have a very good reminiscence, the title of at this time’s submit could appear acquainted.  That’s as a result of about sixteen months in the past, we advised you in regards to the appellate court docket resolution in Oregon that reached this conclusion.  Now it’s official.  The Oregon Supreme Courtroom has weighed in and agrees that underneath Oregon’s product legal responsibility statute, hospitals are sellers of the prescribed drugs they administer and may be held strictly liable as such.  Windfall Well being System-Oregon v. Brown, 372 Or. 225, — P.3d – (2024).    

The choice is singularly centered on the textual content and context of ORS 39.920 – a 1979 Oregon statute that establishes strict merchandise legal responsibility for “one who sells or leases any product in a faulty situation unreasonably harmful . . . if the vendor or lessor is engaged within the enterprise of promoting or leasing such a product.”  Id. at 231.  ORS 39.290 additional says that it needs to be construed in accordance with the Restatement (Second) of Torts §402A and its feedback.  The court docket’s resolution turned on the definition of “sells” and “engaged within the enterprise of promoting.”

Because it seems, there are a selection of each frequent and authorized definitions of “promote” – all of which contain the “switch of a product to a different in change for cash or different worthwhile consideration.”  Id. at 233.  The hospital defendant urged definitions from Black’s and Oregon’s UCC that embrace switch of possession or passing of title and argued that by supplying or administering a drug, it was not “promoting” that drug.  Id. at 233-234.  The court docket concluded that defining a sale because the switch of the “full panoply” of rights of possession, which embrace the flexibility to switch the product to another person, is simply too restricted.  Id. at 234-235.  Partly this resolution was primarily based on the inclusion of “leases” in ORS 39.290 and partially on the truth that “possession” and “title” usually are not ideas included in §402A.  Quite, making use of an instance from the feedback to §402A, the court docket in contrast the hospital administering an intravenous drug to a magnificence store who may be sued in strict legal responsibility for software of a “everlasting wave resolution.” 

Having determined that administering the drug was a sale, the court docket turned as to if the hospital was “engaged within the enterprise of promoting” pharmaceuticals.  Right here the court docket concluded that as a result of the hospital’s enterprise repeatedly concerned transferring merchandise to others in change for consideration, it was “engaged within the enterprise of promoting.”  Once more, turning to §402A, the court docket factors out that remark f states “it isn’t essential that the vendor be engaged solely within the enterprise of promoting such merchandise.”  Id. at 238.  Which means one may be within the enterprise of promoting even when the sale is ancillary to offering a service, comparable to a movie show promoting popcorn.  Quite, the first limitation on being engaged within the enterprise of promoting is being an remoted vendor, comparable to a homemaker who sells the occasional jar of jam to a neighbor.  Which can be an much more outdate instance than the “everlasting wave.” 

Transferring past the textual content of the statute, the court docket regarded to case legislation for context.  Contemplating that the overwhelming majority of the nationwide case legislation interprets §402A as not making use of to hospitals, we might have anticipated this to be the place the tide turned.  Nevertheless, as a result of ORS 39.290 was handed again in 1979, the court docket held that the good majority of all of the nationwide precedent is irrelevant, because it post-dated 1979, and thus couldn’t have a bearing on legislative intent.  Id. at 244.  And, as for the few older instances, the court docket ignored these as a result of it had no proof that the legislature was conscious of them.  On account of this selective use and non-use of the bulk rule, the Oregon legislature was presumed to have “meant” to position Oregon in a definite minority place when nothing within the report supported that “intent” both. 

Briefly, and for now, hospitals are topic to strict legal responsibility in prescription medical product litigation.  That’s except and till the legislature acts to guard them from this moderately bizarrely pro-plaintiff consequence.

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