Justices to hear case regarding consumer proof of deception
CHARLESTON – Justices of the Supreme Court of Appeals must decide whether class action consumer fraud claims require proof of deception.
On June 1, they will hear a case that Putnam Circuit Judge O.C. "Hobby" Spaulding sent to them after he ruled that consumer fraud plaintiffs don't have to prove deception.
Three plaintiffs in the case allege they suffered ascertainable economic losses from purchasing hormone replacements Premarin, Premphase and Prempro.
They seek damages from drug maker Wyeth and its advertising agency, Ketchum Inc.
None of them alleges that Wyeth or Ketchum deceived them.
Stuart Calwell of Charleston sued Wyeth and Ketchum in 2004, on behalf of Shirley White, Cathy Dennison and Jenny Tyler.
They sought to represent all women in West Virginia who bought the drugs, in claims under the West Virginia Consumer Credit and Protection Act.
The act authorizes a civil action for any person who purchases goods and suffers ascertainable loss as a result of another person's use of a prohibited practice.
The act provides recovery of the actual loss or a minimum of $200.
Wyeth and Ketchum moved to dismiss, claiming the women lacked standing because they couldn't connect their purchases to Wyeth's marketing.
Spaulding denied the motion and certified a question of deception to the Justices.
For Wyeth, Pamela Tarr of Charleston wrote that the Legislature empowered the attorney general to bring suit at the first sign of deceptive or unfair conduct.
"Had the Legislature intended individual consumers to enjoy the same rights, the Legislature could have done so," she wrote.
She wrote that legislators expected the attorney general to exercise that power in the public interest.
"By contrast, private plaintiffs operate under no duty to serve the public interest and owe no accountability to the public at large," she wrote.
"Some future plaintiffs, who saw or heard some of the deceptive acts, or whose doctor prescribed a drug in reliance on, or having been influenced by, a deceptive practice, might well have standing to bring a claim under the act," she wrote.
"But these plaintiffs, who can point to nothing, do not," she wrote.
Thomas Rodd of the Calwell Practice answered that the dangers of the drugs the plaintiffs received had not been properly investigated.
He wrote that Wyeth deliberately ignored and misrepresented evidence of risks with intent to deceive consumers, doctors and the general public.
He wrote that plaintiffs "received drugs that were substantially and materially different from and inferior to what these women were entitled to receive in the transaction."
He wrote, "The difference and inferiority in what these women received constituted an ascertainable loss under West Virginia Code."
He urged the Justices to rule that the women are not required to prove that they or their doctors relied on specific misrepresentations Wyeth made.
Attorney General Darrell McGraw, as friend of the court, sided with Rodd.
McGraw Deputy AG Jill Miles wrote that scare resources limit the ability of his consumer protection division to stamp out illegal conduct.
She wrote, "Had the Legislature intended to require consumers to prove they had relied upon a misrepresentation and suffered a loss as a result of their reliance thereon, it would have said so."
She wrote that "consumer protection statutes were enacted to outlaw unfair and deceptive conduct, even if the consumer was not actually deceived."
Another friend of the court, the West Virginia Association for Justice, argued that for ten years the Supreme Court has rejected a requirement for proof of reliance.
Anthony Majestro of Charleston wrote that the group is unaware of any legislative attempt to overturn these precedents.
"Indeed, it seems that only the pharmaceutical manufacturers and others who commit consumer fraud are interested in imposing the reliance requirement," he wrote.
Another friend of the court, the Product Liability Advisory Council, took Wyeth's side on behalf of 101 members.
Henry Jernigan of Charleston warned that if Spaulding's decision stands, lawyers will recast product liability claims as consumer class actions.
Chief Justice Robin Davis and Justice Margaret Workman disqualified themselves from the case. Circuit judges Fred Fox and Omar Aboulhosn replaced them.