Schofield v TFS Manufacturing

1. The application be dismissed with costs. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

A INTRODUCTION AND BACKGROUND 1 This is an application for security for costs in an unfunded "open class" representative proceeding commenced pursuant to Pt IVA of the Federal Court of Australia Act 1976 (Cth) (Act). 2 The current proceeding arises out of circumstances similar to those that I considered in West v Rane [2019] FCA 2195 and West v Rane (No 2) [2020] FCA 616. The current iteration of the claim is best seen by a proposed further amended statement of claim (FASOC), which the parties agreed articulated the allegations made by the second applicant, Mrs Weedon, against the third respondent (Covidien) (although it is of no moment, for clarity, I note that the applicants styled this pleading as a "second amended statement of claim"). 3 There are other applicants and respondents in the proceeding. Relevantly, the group members in the open class fall into two categories. The first are those group members who had surgery performed on them to implant what are described as TFS Implants (who, unsurprisingly, are called the TFS Sub-Group Members); and the second are those women who were implanted with an IVS Tunneller (IVS Implant), who are called the IVS Sub-Group Members. 4 Both the IVS Implants and the TFS Implants were, it is alleged, invented, designed and promoted by the fourth respondent, Dr Peter Petros. The group members are alleged to have been implanted with the devices by either: Dr Petros; a doctor under the supervision of, or with the assistance of, Dr Petros; a surgeon who had been trained by Dr Petros; or someone who had been advised by Dr Petros about the suitability, safety, and efficiency of the implants. Obviously enough, I do not propose to make findings about the accuracy of these allegations, but for the purpose of this security for costs application, it is important to understand the structure of the proceeding as reflected in the allegations pleaded. 5 It is alleged that Covidien, from May 2016, carried on the business of supplying IVS Implants. It is further asserted that both the TFS Implants and the IVS Implants gave rise to a number of complications, the details of which are unnecessary to set out. As against Covidien, Mrs Weedon alleges, in Part D of the FASOC, that in August 2004 she consulted an obstetrician and gynaecologist while suffering from urinary incontinence, and on the advice of her obstetrician, underwent the implantation of an IVS Implant. This procedure was said to have occurred in circumstances where Covidien did not give any or any sufficient information or warning to her (or the other IVS Sub-Group Members), the relevant treating hospitals, and/or their treating doctors of various matters, and the further circumstance that the obstetrician had been advised and educated by Dr Petros and had been told that the IVS Implants were suitable, safe and effective methods of treating the conditions suffered by Mrs Weedon. More particularly, Mrs Weedon makes the following claims: Claims under the Trade Practices Act and the Competition and Consumer Act 66. The IVS Implants were goods within the meaning of sections 4 and 74A(2)(a) of the [Trade Practices Act 1974 (Cth) (TPA)], and sections 2 and 271 of Schedule 2 of the [Competition and Consumer Act 2010 (Cth) (CCA)]. 67. The IVS Implants were supplied to each of the IVS Sub-Group Members as consumers within the meaning of section 4B of the TPA and section 3 of Schedule 2 of the CCA. 68. By reason of: (a) the matters pleaded in paragraphs 9, 10, 11, 13, 52, 53 and, or alternatively, 54 above; and, or alternatively (b) the fact that neither the packaging of the IVS Implants, their Instructions For Use, nor any other document or any other source of information disseminated by Covidien gave sufficient warning, advice or information as to some or all of the POP Warning Matters and/or the SUI Warning Matters; and, or alternatively (c) The IVS Implants not being fit for the purpose for which implants of that kind were commonly acquired the safety of the IVS Implants was not such as persons generally were entitled to expect and the IVS Implants had a defect for the purposes of sections 75AC(1) and 75AD(1) of the TPA and, or alternatively, a safety defect for the purposes of sections 9 and 138 of Schedule 2 of the CCA. 69. By reason of the matters pleaded at paragraph 68 (a) to (c) above, the IVS Implants acquired by each of the IVS Sub-Group Members were not of merchantable quaIity within the meaning of section 740(3) of the TPA, or acceptable quality within the meaning of section 54 of Schedule 2 of the CCA. 70. In the premises, each of the IVS Sub-Group Members has suffered loss and damage, by reason of the fact that: (a) the safety of any of the IVS Implants was not such as persons generally were entitled to expect as pleaded at paragraph 68 above; and in addition, or alternatively (b) the IVS Implants were not of merchantable or acceptable quality as pleaded in paragraph 69 above. PARTICULARS (A) In respect of Ms Weedon the particulars to paragraph 65 above are repeated. (B) Particulars of each of the other Sling Sub-Group Members' loss and damage may be provided after the trial of common issues but is expected to include: (i) personal injury including one or more of the Sling Complications or Removal Complications; (ii) health care expenses; (iii) other out of pocket expenses; (iv) economic loss; (v) the need for gratuitous and in addition, or alternatively, commercial care; and (vi) non-economic loss. 71. In the premises, … Covidien is liable to compensate each of the IVS Sub-Group Members for their loss and damage pursuant to: (a) section 75AD of the TPA, or section 138 of Schedule 2 of the CCA, as the case may be; and, or alternatively, (b) section 740(1) of the TPA, or sections 54,271 and 272 of Schedule 2 of the CCA, as the case may be. Claims in Negligence 72. … Covidien owed the IVS Sub-Group Members a duty to exercise reasonable care and skill in the design, evaluation, manufacture, marketing and supply of the IVS Implants. 73. … Covidien: (a) designed and manufactured the IVS Implants for the POP Purpose and/or the SUI Purpose; (b) did not undertake adequate clinical or other evaluation of the IVS Implants prior to the release in Australia and/or the supply, distribution, marketing or promotion in Australia of the IVS Implants, as pleaded at paragraphs 51 to 54 above. 74. In the circumstances pleaded at paragraph 73 above, … Covidien designed, evaluated, manufactured, marketed and in addition, or alternatively, supplied the IVS Implants containing: (a) the characteristics pleaded at paragraph 10 above; and in addition, or alternatively; (b) a risk of, and in addition, or alternatively, a susceptibility to causing the Implant Complications and, or alternatively, the Implant Removal Complications. 75. In addition to paragraph 73 above, … Covidien continued to design, manufacture, market and in addition, or alternatively, supply the IVS Implants notwithstanding the matters pleaded at 73 and 74 above. 76. In addition, or alternatively, to paragraph 75 above, … Covidien failed to conduct adequate evaluation of the safety and effectiveness of the IVS Implants in treating POP and/or SUI after releasing them in Australia. 77. Further, or alternatively, … Covidien failed to conduct adequate evaluation of the long-term safety and effectiveness of the IVS Implants in treating POP and/or SUI after releasing them in Australia. 78. … Covidien failed to inform any of the IVS Sub-Group Members, treating hospitals; and in addition, or alternatively treating doctors of the IVS Warning Matters. 79. By reason of the matters pleaded at paragraphs 73 to 77 above, … Covidien breached [its] duty of care to the IVS Sub-Group Members. 80. By reason of the matters pleaded at paragraphs 73 to 77 above, the IVS Sub-Group Members have suffered loss or damage. 6 Both parties accepted that the claims of Mrs Weedon and the IVS Sub-Group Members are claims which could properly be characterised as both personal injury and product liability claims.