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BULLETIN THE Media Kit Digital and print editions Reach all South Australian lawyers Legal advice written by lawyers for lawyers P (08) 8233 9433 E [email protected] W www.boylen.com.au

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Page 1: BULLETIN - Web, Design, & Digital Strategy in Adelaide · Design Service We have an in-house graphic design department which is available for the development of advertisements. We

B U L L E T I NTHE

Media Kit

Digital and print editions

Reach all South Australian lawyers

Legal advice written by lawyers for lawyers

P (08) 8233 9433 E [email protected] www.boylen.com.au

Page 2: BULLETIN - Web, Design, & Digital Strategy in Adelaide · Design Service We have an in-house graphic design department which is available for the development of advertisements. We

AT A GLANCE

REGULAR SECTIONS INCLUDE:• Aspects of law

• Profitability of legal practice

• New technology

• Office systems

• New areas of business

• The continuing social role of legal practitioners within South Australian society with a strong emphasis on human interest and social matters.

The Bulletin, the official journal of The Law Society of South Australia, is the only magazine to reach every legal practitioner in South Australia.

Most law firms are partnerships and lawyers make decisions for themselves as well as their firms. They also advise their clients on subjects including investments, insurance, banking, finance and corporate structures.

10,000READERS PER ISSUE

REACH LEGAL PRACTITIONERS, MEMBERS OF THE JUDICIARY, MEMBERS OF ALLIED PROFESSIONS, POLITICIANS

AND OTHER SUBSCRIBERS

It is delivered by name to all members of The Law Society at their offices. It can also be found online at www.boylen.com.au and www.lawsocietysa.asn.au. As a result, The Bulletin also reaches executive staff and other professionals who are directly employed by members of The Law Society.

Page 3: BULLETIN - Web, Design, & Digital Strategy in Adelaide · Design Service We have an in-house graphic design department which is available for the development of advertisements. We

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THE BULLETIN October 201820

CONSUMER LAW

FLOYD BAKEWELL AND FIONA CAMPBELL, DUNCAN BASHEER HANNON

Often, problems with products or services affect more than one person.

In such situations, it may be attractive for the group of affected people to bring an action together.

CLASS ACTIONS

A representative group action (class action) can be brought in the Magistrates, District, Supreme or Federal Courts.

Each Court’s rules set out the process by which a group of affected people can commence a class action.

Usually the group representative, or lead Plaintiff issues proceedings and applies for authorisation to bring the claim on behalf of the group (see Magistrates Court Civil Rule 23 (5), Supreme Court Civil Rule/District Court Civil Rule 80 and/or Federal Court Rule 9.21).

Bringing a class action may be attractive to people who have suffered loss due to the same product or service failing. This is because the facts regarding the failing of the product or service are the same for each member of the group, meaning resources with respect to undertaking liability investigations can be pooled, reducing disbursement costs for each group member. Further, Defendants may view a group of claimants as more formidable than individual Plaintiffs, due to the greater resources that may be available.

DEPUY ASR CLASS ACTION

DePuy International Limited (DePuy) manufactured the DePuy ASR hip

prostheses (product). The products were suppliedbyDePuytoJohnson&JohnsonMedicalPtyLimited(Johnson&Johnson).Johnson&Johnsonsoldtheproductstohospitals and orthopaedic surgeons in Australia and internationally.

The products were marketed as being longer lasting and higher functioning than other hip replacement prostheses on the market. They were designed to operate with metal components, directly touching or moving, with or against, other metal components.

From approximately 2004 to 2009, the product was used in total hip replacements and hip resurfacing surgeries performed in Australia. It was also used globally.

Following the introduction of the product, evidence began emerging that it was, amongst other things, leaching cobalt and chromium into the blood of the implanted.

On 24, August 2010, DePuy issued a worldwide recall of the product. By reference to the Australian Government, Department of Health website, the recall notice was received by approximately 93,000 people across the globe.

Following the recall notice, many of those implanted with the product underwent blood metal testing and radiological investigations, to ascertain the impact of the faulty product on their body. As a result of the complications posed by the product, a large number of those implanted underwent revision surgery.

The issuing of the recall notice led to a large number of those implanted with

theproductcontactinglawfirms,withaview to pursuing compensation. Given the number of enquiries, the situation leant itself suitably to a class action. Ourfirm,DuncanBasheerHannon

(DBH), received a great many enquiries and ultimately a group of approximately 200 interested people wished to pursue a claim as part of a class action.In2011,DBHfiledaStatementof Claim

in the Supreme Court of South Australia, on behalf of two clients who were implanted with the product and suffered injury,lossanddamageasaresult.Thepleadingswerefiledonthebasisthatthetwo individual Plaintiffs represent a group of people also implanted with the product, with an interest in the outcome of the action (the Group Members).

Both actions were against DePuy and Johnson&Johnson(theDefendants).The Statement of Claim pleaded that the Plaintiffs were claiming compensation on the basis that Defendants had breached the Trade Practices Act 1974 (Cth) (the TPA), and on the basis that they had acted negligently. Given the focus of this month’s Bulletin, the action in negligence will not be discussed further.

The Plaintiffs claimed that the product wasnotreasonablyfitforpurposepursuant to Section 74B, and/or in the alternative, not of merchantable quality pursuant to Section 74D. TheTPAwasrepealedon1January,

2011, meaning that any similar class actions in the future concerning whether goodsarereasonablyfitforthepurpose

A CLASS ABOVE THE

REST – THE CASE

FOR CLASS ACTIONS

October 2018 THE BULLETIN 21

and/or of merchantable quality, will need to be brought under section 236 of the Australian Consumer Law, contained in Schedule 2 of the Competition and Consumer Act 2010 (Cth) (the ACL), for a breach of sections 54 and 55.

In 2012, the South Australian Supreme CourtactionwasjoinedwithalargergroupactionagainstDePuyandJohnson&Johnson,issuedintheFederalCourtof Australia.

The Defendants denied the allegations that they breached the TPA and acted negligently, and a trial on the issue of liability commenced in 2015. The trial ran for 17 weeks. Beforeajudgmentonliabilitywas

delivered, the parties reached a negotiated settlement of $250 million plus interest. The settlement was then approved by the Federal Court.

A Settlement Scheme was then drafted by the solicitors for the Plaintiffs, which was approved by the Federal Court. This document addressed the administration of the $250 million settlement sum.

REGISTRATION

In accordance with the Settlement Scheme, in order for a person to receive compensation as a result of the failure of theirproduct,itwasfirstnecessaryforthem to “register” their claim. This was done online, or via hard copy registration form.

Pursuant to the Scheme, anyone satisfying the eligibility criteria could

register their claim against the scheme, even if they were not involved in the Court proceedings. Accordingtothelatestfigurespublished

by Maurice Blackburn and Shine Lawyers (lead Settlement Scheme Administrators) on the class action website, 1,748 people registered as members of the class action.

ELIGIBILITY

Once registered, it was necessary for Group Members to be found eligible to receive compensation.Theeligibilitycriteriaweresatisfied

where:1. The Group Member had undergone

actual revision of their product; or2. TheGroupMembersatisfiedthe

“deemed revision criteria” (i.e. they had been told by their orthopaedic specialist that revision surgery was necessary, but could not be performed due to other medical comorbidities and the risk that those comorbidities posed in the face of surgery).

Group Members have 13 years from the date of their implant surgery to satisfy the eligibility criteria, otherwise their interest in the Settlement Sum lapses.

FAST TRACK V INDIVIDUAL ASSESSMENT

Once eligibility was determined, Group Members were given the option of electing a fast-track resolution ($55,000 lumpsumperhip,inadditiontofixedlegal costs, reasonable disbursements and any amounts owing to third parties), or to

undergo an individual assessment (a full assessment of damages).

FINAL THOUGHTS

Bringing an action in the Federal Court against international giants, DePuy and Johnson&Johnson,andprogressingthe matter to a 17-week trial, was only possible because a large number of people suffered harm as a result of the failure of the product, and therefore had a common interest in the action.

Had a claim been brought by an individual (rather than a group), the legal costs and disbursements incurred in proving liability would have been likely to far outweigh any compensation received. Further, the risk of being unsuccessful at trial and the cost implications that would have followed, would have likely been too great for any individual to bear. For the Courts, if a volume of similar actions proceededagainstDePuyandJohnson&Johnson,asindividualorsmallergroupactions, the actions would have likely overwhelmed the system, ultimately causing delays and backlogs.

Now, in the latter stages of the administration phase of the DePuy hip classaction,itisdifficulttoimaginethematter proceeding in any way other than a class action. The Settlement Sum of $250 million plus interest demonstrates the power of the group members when joinedtogether.Giventheeffectivenessof class actions, we consider they will become more prevalent in the future. B