Needham v. White Laboratories, Inc.

• Decision Date: 16 June 1988
• Docket Number: Nos. 87-1379,87-1842 and 87-1872,s. 87-1379
• Citation: 847 F.2d 355
• Parties: Anne NEEDHAM, Plaintiff-Appellee, Cross-Appellant, v. WHITE LABORATORIES, INC., Defendant-Appellant, Cross-Appellee.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 355

847 F.2d 355

Anne NEEDHAM, Plaintiff-Appellee, Cross-Appellant, v. WHITE LABORATORIES, INC., Defendant-Appellant, Cross-Appellee.

Nos. 87-1379, 87-1842 and 87-1872.

United States Court of Appeals Seventh Circuit.

Argued Feb. 26, 1988.

Decided May 16, 1988.

Rehearing and Rehearing En Banc Denied June 16, 1988.

Henry R. Simon, Law Office of Henry R. Simon, Newark, N.J., for defendant-appellant, cross-appellee.

Thomas H. Bleakly, David A. Novoselsky & Assoc., Chicago, Ill., for plaintiff-appellee, cross-appellant.

Before BAUER, Chief Judge, POSNER, Circuit Judge, and PELL, Senior Circuit Judge.

POSNER, Circuit Judge.

Anne Needham brought this products liability suit against White Laboratories, basing federal jurisdiction on diversity of citizenship, and after a jury trial obtained a judgment for $800,000. White Laboratories appeals from the judgment. Needham cross-appeals, seeking a new trial on damages or, alternatively, additional interest on the judgment.

In 1952 Anne Needham's mother, while pregnant with her, used a prescription drug manufactured by White Laboratories--dienestrol--to prevent a miscarriage. Dienestrol is a synthetic estrogen similar to the better-known DES (diethylstilbestrol). In 1974 Anne Needham developed clear-cell adenocarcinoma, a vaginal cancer that is substantially more common among women whose mothers received estrogen treatments during pregnancy than among other women. See Melnick et al., Rates and Risks of Diethylstilbestrol-Related Clear-Cell Adenocarcinoma of the Vagina and Cervix, 316 New Eng.J.Medicine 514 (1987). Anne Needham brought this suit in 1976, and in 1979 won a judgment for $800,000 which this court reversed because of error in the admission of evidence. 639 F.2d 394 (7th Cir.1981). On May 12, 1982, the district court decided that the new trial we had ordered would be limited to liability, and that if Needham won again her damages would be the same $800,000 that she had been awarded at the end of the first trial. She did win again, she was duly awarded $800,000, and the present appeal and cross-appeal followed.

According to White Laboratories, the critical issue in the second trial was whether it should have known back in 1952 that dienestrol might pass through the placenta and induce cancer in the fetus. If so, White Laboratories admits it would be found liable either for negligence, or for the form of strict liability (perhaps misnamed, see Flaminio v. Honda Motor Co., 733 F.2d 463, 466 (7th Cir.1984)) that consists of selling without a warning a product which the seller should know is unreasonably dangerous (see Woodill v. Parke, Davis & Co., 79 Ill.2d 26, 37 Ill.Dec. 304, 402 N.E.2d 194 (1980))--provided that the issue of causation was also resolved in Anne Needham's favor: the Melnick study indicates that clear-cell adenocarcinoma is not always caused by estrogen therapy, so there is some chance that she would have developed the condition even if her mother had never taken dienestrol. On this appeal, however, White Laboratories does not question the sufficiency of the evidence that White should have known of the danger and also that Anne Needham would not have developed adenocarcinoma but for her mother's taking dienestrol.

It had long been known that estrogen treatments could cause cancer in the women receiving the treatments, and that many substances could pass through the placental barrier. A study conducted in 1940 and known to White Laboratories had found abnormalities in the sexual organs of both male and female offspring of rats who had been injected with estrogen during pregnancy. See Greene, Burrill & Ivy, Experimental Intersexuality: The Effects of Estrogens on the Antenatal Sexual Development of the Rat, 67 Am.J.Anatomy 305 (1940). But no studies had shown that estrogen would cause cancer in the fetus (contrary to the confident statement in Bichler v. Eli Lilly & Co., 55 N.Y.2d 571, 586, 436 N.E.2d 182, 189 (1982), based on a concession by the defendant in that case); and only one study had found that any cancer could be induced in a fetus by migration of a carcinogen across the placenta, see Larsen, Weed & Rhoads, Pulmonary-Tumor Induction by Transplacental Exposure to Urethane, 8 J.Nat'l Cancer Inst. 63 (1947) (urethane, causing lung cancer in offspring of pregnant mice)--let alone the long-delayed estrogen-induced cancer that struck Anne Needham when she was an adult.

This may be rather tenuous footing for an inference that before marketing a new drug to pregnant women back in the early 1950s White Laboratories should have conducted tests on pregnant animals (which it did not do) and that if it had done so it would have discovered that estrogen therapy might cause cancer in fetuses, in which event it would surely have had to tell physicians, including Mrs. Needham's physician, to warn their patients of the danger. On the other hand, White Laboratories is almost certainly mistaken in suggesting that the jury would have had to draw this inference in order to impose liability. It would have been quite enough--might indeed have been more than enough, as we shall see later--that White Laboratories should have known that estrogen could cause some harm to the fetus, and immaterial whether the harm took the form of cancer, let alone a specific cancer such as clear-cell adenocarcinoma. McMahon v. Eli Lilly & Co., 774 F.2d 830, 835-36 (7th Cir.1985) (applying Illinois law in a DES case).

At all events, White Laboratories does not question the jury's right to draw an inference of negligence or unreasonable (implying reasonably foreseeable) danger. It does complain about the jury instructions, however, and about the action of the plaintiff's counsel in harping to the jury on the dangers of dienestrol to Anne Needham's mother, even though she was not a plaintiff and, so far as appears, had not been injured by the estrogen treatments that she took while pregnant. The complaints are related; the alleged error in the instructions consists of language that, White Laboratories argues, authorized the jury to award judgment to Anne on the basis of the dangers of dienestrol to her mother.

The attack on the instructions assumes, what is by no means certain but is also unnecessary to decide, that if the harm to Anne Needham was unforeseeable she cannot recover damages merely because the defendant was negligent toward her mother and the negligence caused the daughter's injury. Against the assumption it can be argued that while unforeseeable plaintiffs are sometimes barred (the most famous example being Palsgraf v. Long Island R.R., 248 N.Y. 399, 162 N.E. 99 (1928)), this is by no means always true. In Renslow v. Mennonite Hospital, 67 Ill. 2d 348, 10 Ill.Dec. 484, 367 N.E.2d 1250 (1977), a child who had not been conceived at the time the hospital's employees committed negligent acts against her was allowed to recover the harm to herself caused by those acts. The present case is thus an even stronger case for what the Supreme Court of Illinois later described as the "limited area of transferred negligence" (corresponding to transferred intent in the law of intentional torts) recognized in Renslow. Kirk v. Michael Reese Hospital & Medical Center, 117 Ill.2d 507, 528, 111 Ill.Dec. 944, 954, 513 N.E.2d 387, 397 (1987). See also Horak v. Biris, 130 Ill.App.3d 140, 85 Ill.Dec. 599, 474 N.E.2d 13 (1985).

Even if the injury to Anne Needham would have had to be foreseeable for White Laboratories to be held liable, its attack on the instructions must fail--and this though the instructions are redundant, disorganized, and full of legal jargon. White Laboratories does not complain about the instructions en masse; and although the result of the judge's picking and choosing among the instructions tendered by the parties leaves much to be desired as a specimen of English prose designed for persons with no legal training, we do not set aside a jury verdict on the ground of lack of clarity, or even outright error in some of the instructions, unless--having due regard for the unrealism of assuming that isolated passages in a long set of instructions are likely to have made the difference--we are convinced that the instructions, taken as a whole (see United States v. Machi, 811 F.2d 991, 995 (7th Cir.1987)), are likely to have impaired substantially the jury's ability to understand the case. See W.T. Rogers Co. v. Keene, 778 F.2d 334, 341-42 (7th Cir.1985); Wilk v. American Medical Ass'n, 719 F.2d 207, 218-29 (7th Cir.1983); Binks Mfg. Co. v. National Presto Industries, Inc., 709 F.2d 1109, 1117-18 (7th Cir.1983).

White Laboratories focuses on the instruction that allowed the jury to find negligence if "the defendant failed to warn the medical profession ... about the reasonably foreseeable potential development of cancer to users and their offspring exposed to the effects of the drug," or "failed to reasonably test for potential harmful effects to users and their offspring." There was much evidence that White Laboratories should have warned the medical profession about the danger that dienestrol would cause cancer in the users of the drug, such as Anne Needham's mother. This evidence was admissible and admitted, even though Mrs. Needham was not a plaintiff, because the more carcinogenic a drug is, the greater the duty of the manufacturer to explore the full scope of its potential danger. This is an application of the basic tort principle (itself a corollary of the even more basic principle that negligence is the failure to take a level of precautions commensurate with the likelihood and magnitude of the risk created by the defendant's conduct, see, e.g., McCarty v. Pheasant Run, Inc., 826 F.2d 1554, 1556-57 (7th Cir.1987); Kirk v. Michael Reese Hospital & Medical Center, supra, 117 Ill.2d at 526, 111 Ill.Dec. at 953, 513 N.E.2d at 396) that the greater the benefits of precaution, the more precautions must be taken. See, e.g., German v. Illinois Power Co., ...