Subject: Law: Plaintiffs' Attorneys Hail Verdict Against Blood Bank Date: Published: 12/5/88 128 lines Source: Wall Street Journal. Copyright Dow Jones & Co. Inc. Law: Plaintiffs' Attorneys Hail Verdict Against Blood Bank ---- By Richard B. Schmitt Staff Reporter of The Wall Street Journal SAN FRANCISCO -- A five-year-old boy who acquired AIDS after a blood transfusion won a lawsuit against the supplier, the first such jury verdict in the country and one that plaintiffs' lawyers say could have implications for other victims of the disease. A San Francisco Superior Court jury awarded $750,000 in damages to Michael Osborn and his parents after a five-week trial that ended last week. Michael had open-heart surgery in February 1983, a month after he was born, and later contracted AIDS from blood he received during the operation. The jury held that the supplier, Irwin Memorial Blood Bank, negligently handled the blood. Irwin Memorial, the largest blood supplier to hospitals in Northern California, has been targeted in several other similar suits, and plans an appeal. Like many blood banks, San Francisco-based Irwin is a nonprofit institution. Michael Moriarty, a San Francisco lawyer for the Osborn family, says he thinks the decision could prompt Irwin and other blood banks around the country to more seriously consider out-of-court settlements in cases of alleged negligent handling of AIDS-tainted blood. "It is going to cause the blood banks and their insurance carriers to realize that they are vulnerable," he says. But defense lawyers say that this may be an extreme case, involving a situation that is particularly heart wrenching. As a result, they don't believe it necessarily will be followed by other juries. Dozens of such cases are believed to be pending nationally, many in the San Francisco area. Blood transfusions are one of the principal ways in which AIDS, or acquired immune deficiency syndrome, has been transmitted. Since 1985, blood banks have been legally required to screen blood supplies for the presence of the AIDS virus. All the lawsuits have focused on the amount of information available to the suppliers and what obligations they had to patients -- before screening was mandatory. Legally, transfusion cases have been especially challenging to plaintiffs. Most states, including California, consider blood a "service" and therefore not subject to ordinary rules of product-liability law. In many cases involving allegedly defective products, plaintiffs can hold a defendant liable by merely showing that an injury has resulted, without proving wrongdoing. But blood's special status means that plaintiffs have had the burden of proving actual negligence. In the Osborn case, therefore, Mr. Moriarty cited evidence during the trial that he claimed should have put Irwin on notice. Among other things, he noted that federal officials held a January 1983 emergency meeting at the federal Centers for Disease Control in Atlanta on the possible links between transfusions and AIDS -- seven weeks before Michael Osborn's operation. Because of the cost of screening, he alleged, Irwin and other blood banks ignored the warnings as well as a plea from some federal health officials to begin screening supplies. Irwin and other blood-bank operators have argued, however, that evidence of transfusion-linked AIDS cases wasn't clear enough until well after early 1983 to take more stringent action. Moreover, Duncan Barr, a San Francisco attorney for Irwin, says the verdict less reflected concern with the blood bank's screening procedures than its refusal to let the Osborn family donate the blood that would be used in Michael's operation. Mr. Moriarty argued at trial that Irwin refused the "directed donation" because it would have meant less profit. Mr. Barr says Irwin refused because too many family members -- and too much time -- would have been required to obtain the amount of blood that the boy needed. He says the judge barred his explanation, which will be an issue on appeal. In post-trial interviews, the jurors were "impressed" with efforts that the blood bank subsequently made to weed out high-risk donors and to develop early tests for detecting AIDS-tainted blood, according to Mr. Barr. Nonetheless, the decision demonstrates the lengths to which sympathetic juries will go to find liability in such tragic cases. It follows a verdict by a federal district court jury in Atlanta last month that awarded $1.6 million in damages against a Miles Inc. division in which a hemophiliac contracted AIDS from a blood-based clotting drug. In that case, the jury held Miles responsible for the negligence of a Texas blood-bank that supplied it. There was evidence that the donor had died of AIDS weeks after giving his blood. That decision is also being appealed. The Osborn case "shows that juries will recognize that blood banks are not altruistic organizations but rather businesses that make decisions based on profit rather than the welfare of recipients of their blood," says Sarah Jane Burgess, whose San Francisco law firm secured a 1986 settlement from Irwin in another AIDS transfusion case. The firm has about 20 similar cases pending; Ms. Burgess says she was "excited and pleased" with the Osborn decision. Still, there was evidence in the Osborn case that the jury struggled with its decision. It took four days to reach a verdict, and at one point reported to the judge that it was at an impasse. The final 9-to-3 decision involved the minimum number of votes to find against Irwin. The $750,000 award compared with $3 million in damages originally sought. Also, the University of California at San Francisco's medical center, where the surgery on the Osborn boy was done, was dismissed by the judge as a defendant before the jury began its deliberations. The judge decided that there was insufficient evidence from which any jury could reasonably find wrongdoing. The decision enforces a recent trend in which hospitals have been relieved of responsibility in transfusion cases. Plaintiffs have had particular trouble proving negligence against hospitals because the industry has long considered it too cumbersome to retest or screen every product or blood sample that it receives. Mr. Moriarty "said all kinds of bad things about the hospital," says John Kern, an Oakland attorney for the university facility, "but he had no expert to back him up." Mr. Moriarty plans to appeal that ruling. [This article is made available here by Dow Jones Co. for the personal and non-commercial use of callers to this bbs, in the hope that it will be of some help to those who are suffering from the disease and others who are seeking to help them.]