January 2, 2019

Toxic torts time bomb: Will the UK follow US trends in the coming year?

A number of legal uncertainties remain.

The progression of the legacy claims market will be of great interest to insurers in the coming year. Claimant firms' business development efforts are likely to increase over the next 12 months as they look for new revenue streams, as traditional business models come under pressure. Legislative changes, for example introducing fixed recoverable costs for Noise Induced Hearing Loss claims and the recent introduction of fixed costs for gastric illness claims, have seen profits tumble and prompted the hunt for replacement income generators.  

In identifying the areas in which these revenue streams will be pursued, there remains the usual danger of the US sneezing and the UK catching cold. Various different toxic tort claims are ongoing in the US, the most eye-watering of which has been the talcum powder litigation. US plaintiffs have alleged that the development of their cancers, including mesothelioma and ovarian cancer, can be directly linked to the use of talcum powder products containing asbestos.

Several juries in various US States have awarded punitive damages in the many millions of dollars. With nearly 10,000 ovarian cancer actions made against Johnson & Johnson alone the scale of the issue should not be underestimated. Both sides are appealing adverse decisions, ensuring the scientific and legal debates will continue.

Reports on the litigation within the UK have referred to a potential toxic tort 'timebomb'. However, whilst several claimant representatives within the UK are raising the ongoing litigation within their marketing materials, the claims market in the UK has not progressed, possibly because of several legal uncertainties. 

Recent news reports have suggested that Johnson & Johnson were aware of trace amounts of asbestos in its talcum products since at least 1971. These reports will carry greater weight in the US jury trial system, than with the judiciary in the UK, where the main hurdle for these claims (and other types of developing toxic torts such as glyphosate) lies with medical causation. Nonetheless, plaintiff victories in the US are likely to prompt further research into the carcinogenicity of talcum powder, and the outcome of such research will be of great interest internationally. Even with competing causation arguments, the UK's Compensation Act will ensure that a single defendant will be liable for a successful claimant's entire compensation entitlement.   

In addition, the landmark decision of Dryden earlier this year has meant that it is more likely that claims will be advanced for physiological changes which have left claimants worse off in some measure. It will be interesting to note how the decision will impact the manner in which legacy claims are pursued.

You can read the rest of our insurance predictions here.