Kaufman v. Eli Lilly and Co.

Decision Date09 July 1985
Citation482 N.E.2d 63,492 N.Y.S.2d 584,65 N.Y.2d 449
Parties, 482 N.E.2d 63, 54 USLW 2077, Prod.Liab.Rep. (CCH) P 10,652 Karen L. KAUFMAN, Respondent, v. ELI LILLY AND COMPANY, Appellant, and Abbott Laboratories, Inc., et al., Respondents.
CourtNew York Court of Appeals Court of Appeals
OPINION OF THE COURT

SIMONS, Judge.

This is one of 15 similar actions pending in the First Department seeking to recover from pharmaceutical companies for injuries allegedly sustained by the plaintiff daughters as a result of their mothers' ingestion of the drug diethylstilbestrol (DES) while pregnant. In 1977 the Assistant Administrative Justice designated the actions as "complex litigation cases" and assigned them to Justice Arnold Fraiman, directing him to handle all matters relating to them. The first of the 15 actions chosen to be tried was Bichler v. Lilly & Co., 55 N.Y.2d 571, 450 N.Y.S.2d 776, 436 N.E.2d 182 and the rest were held pending its disposition. The principal issue in this appeal is the collateral estoppel effect to be given to certain jury findings in that action.

After we sustained a jury verdict against Lilly in Bichler, plaintiff moved for partial summary judgment precluding Lilly from relitigating six issues decided by the Bichler jury, a severance of the action against Lilly and an immediate trial on the issues of DES ingestion, causation and damages. Lilly cross-moved to depose two of the jurors in the Bichler case to establish that their verdict was a compromise. The remaining defendants cross-moved for a severance in the event the court granted plaintiff's motion for collateral estoppel against Lilly. Special Term granted plaintiff's motion for partial summary judgment, denied Lilly's cross motion and granted the codefendants' motions for a severance. 116 Misc.2d 351, 455 N.Y.S.2d 329. A divided Appellate Division affirmed and granted Lilly leave to appeal to this court on a certified question. 99 A.D.2d 695, 471 N.Y.S.2d 830. We now modify the order of the Appellate Division and hold that Lilly may not be collaterally estopped from relitigating the jury's finding that it acted in concert with other drug manufacturers in testing and marketing DES for use in treating accidents of pregnancy. Our modification is required because the concerted action liability found in Bichler was based on an unresolved question of law which should not be given preclusive effect in this litigation.

I

In early 1954, plaintiff's mother, then pregnant with her, was prescribed DES to prevent a miscarriage. In July 1973, when plaintiff was 18 years old, it was discovered that plaintiff had cancer of the cervix. A radical hysterectomy was performed and, as a result, plaintiff will be unable to bear children. She instituted this action in 1976 alleging in her amended complaint that her mother's ingestion of DES while pregnant was the proximate cause of the injuries she sustained. Because she was unable to clearly identify the manufacturer of the DES her mother took, plaintiff joined as defendants nine of the approximately 147 pharmaceutical companies manufacturing and marketing DES for the prevention of miscarriages in pregnant women in 1954. She alleged that the defendants were liable to her, inter alia, on a concerted action theory of liability because they had "combined and conspired to obtain the approval for DES" without adequate testing.

The Bichler action involved a young woman who developed cervical and vaginal cancer at the age of 17. She brought suit against Eli Lilly & Company and others, alleging that her mother's ingestion of DES in 1953 while she was pregnant with her caused her injuries. Plaintiff's theory was that DES had been marketed without adequate testing to determine its safety. After the plaintiff was unsuccessful in attempting to prove that Lilly manufactured the DES prescribed for her mother, she submitted her case to the jury on a concerted action theory of liability. In addition to returning a general verdict for plaintiff, the Bichler jury answered seven special interrogatories in her favor as a basis for imposing liability on Lilly. 1 On appeal the Appellate Division and this court affirmed. The courts below gave collateral estoppel effect in this action to six of the Bichler jury's findings. 2

Lilly raises three grounds for reversal of the order granting that relief. First, it contends that the decision in Bichler should not be given collateral estoppel effect because (1) the cases do not raise identical issues, (2) there are indications that the Bichler verdict was based on jury compromise, (3) there are adjudications inconsistent with Bichler on each of the issues involved and (4) the Bichler decision is based on an unresolved and novel application of the law of concerted action not expressly adopted in New York. Second, Lilly asserts that if we find its proof of jury compromise in Bichler insufficient as it now exists to defeat the application of collateral estoppel, it should be allowed to depose two named jurors from the Bichler jury to demonstrate further its contention. Finally, Lilly urges that the lower court erred in severing plaintiff's action against it from actions against the remaining defendants.

II

The doctrine of collateral estoppel precludes a party from relitigating "an issue which has previously been decided against him in a proceeding in which he had a fair opportunity to fully litigate the point" (Gilberg v. Barbieri, 53 N.Y.2d 285, 291, 441 N.Y.S.2d 49, 423 N.E.2d 807; see, Schwartz v. Public Administrator, 24 N.Y.2d 65, 69, 298 N.Y.S.2d 955, 246 N.E.2d 725). It is a doctrine intended to reduce litigation and conserve the resources of the court and litigants and it is based upon the general notion that it is not fair to permit a party to relitigate an issue that has already been decided against it. There are now but two requirements which must be satisfied before the doctrine is invoked. First, the identical issue necessarily must have been decided in the prior action and be decisive of the present action, and second, the party to be precluded from relitigating the issue must have had a full and fair opportunity to contest the prior determination (Gilberg v. Barbieri, supra, 53 N.Y.2d at p. 291, 441 N.Y.S.2d 49, 423 N.E.2d 807; Schwartz v. Public Administrator, supra, 24 N.Y.2d at p. 71, 298 N.Y.S.2d 955, 246 N.E.2d 725; see, Koch v. Consolidated Edison Co., 62 N.Y.2d 548, 554-555, 479 N.Y.S.2d 163, 468 N.E.2d 1, cert. denied 469 U.S. 1210, 105 S.Ct. 1177, 84 L.Ed.2d 326; Ryan v. New York Tel. Co., 62 N.Y.2d 494, 500-501, 478 N.Y.S.2d 823, 467 N.E.2d 487). The party seeking the benefit of collateral estoppel has the burden of demonstrating the identity of the issues in the present litigation and the prior determination, whereas the party attempting to defeat its application has the burden of establishing the absence of a full and fair opportunity to litigate the issue in the prior action (see, Ryan v. New York Tel. Co., supra, at p. 501, 478 N.Y.S.2d 823, 467 N.E.2d 487; Schwartz v. Public Administrator, supra, 24 N.Y.2d at p. 73, 298 N.Y.S.2d 955, 246 N.E.2d 725). Applying these rules, we hold that collateral estoppel effect should be denied for the Bichler jury's finding on concerted action but that Lilly should be precluded from relitigating the five remaining issues relevant to this action and decided adversely to it in that trial (see, n. 2, at p. 455, at p. 587 of 492 N.Y.S.2d, at p. 66 of 482 N.E.2d supra ).

A

When Bichler was before this court Lilly challenged the concerted action theory of liability on two grounds. It claimed that it was not an appropriate theory of liability in DES litigation when the identity of the manufacturer is not established and that the court's charge on the theory was erroneous. Although both of these issues could have been raised by appropriate objection in the trial court, they were not, and because they were not, we did not pass on them. We held only that the evidence was legally sufficient to support the jury's findings of concerted action and foreseeability based on the charge given and that the trial court did not err in refusing Lilly's request to charge on its duty to warn (see, Bichler v. Lilly & Co., 55 N.Y.2d 571, 584-587, 450 N.Y.S.2d 776, 436 N.E.2d 182, supra ). We noted in a footnote that there were several theories upon which similar DES cases were proceeding or it had been suggested they might proceed but we expressed no view in Bichler and, express none now, on which of the proposed theories--concerted action, alternative liability, enterprise liability or market share liability--if any, should be adopted in this or similar DES cases (see, Bichler v. Lilly & Co., supra, at p. 580, n. 5, 450 N.Y.S.2d 776, 436 N.E.2d 182). The question is still an open one in New York.

The point is significant because collateral estoppel effect will only be given to matters "actually litigated and determined" in a prior action (see, Restatement of Judgments § 27, quoted in Koch v. Consolidated Edison Co., 62 N.Y.2d 548, 554, n. 2, 479 N.Y.S.2d 163, 468 N.E.2d 1; see also, Ryan v. New York Tel. Co., 62 N.Y.2d 494, 478 N.Y.S.2d 823, 467 N.E.2d 487, supra ). If the issue has not been litigated, there is no identity of issues between the present action and the prior determination. An issue is not actually...

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