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The Big Business of Nano Litigation

Attorneys Are Hard at Work Protecting Nanotech Makers—What About Consumers?

WARNING: Manufacturer protected, even if you are not. SOURCE: SP A recent conference examining the legal protections corporations are taking to defend themselves in the event their products turn toxic highlights regulatory questions.

It suddenly struck me while attending a two-day nanotechnology conference in Washington last week: I should have gone to law school.

This fascinating conference, sponsored by the Food and Drug Law Institute and aimed largely at company officials, offered panel after panel of lawyers telling nanotech execs how to avoid getting sued by…other lawyers.

Weiss’s Notebook

CAP Senior Fellow Rick Weiss

CAP Senior Fellow Rick Weiss covered science and medicine for The Washington Post for 15 years, and now he brings his investigative eye to science policy. From cloning and stem cells to agricultural biotechnology and nanotechnology, Weiss examines the issues at the intersection of cutting edge research and public policy.

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Whether it’s about suing or being sued, it seems that nanotechnology—and every other new technology with a still-uncertain benefit-to-risk ratio—is a 21st century Full Employment Act for attorneys.

“‘Sophisticated user’ is a great defense….That’s how we’ve escaped liability for lots of clients.”

“If you think nanotech liability claims are never going to be a problem, you’re dreaming,” said Lynn L. Bergeson, a partner at Bergeson & Campbell P.C. in Washington, noting that even a “fear of disease” is sufficient basis these days for filing a lawsuit. That’s a standard that may not be difficult to meet today given the array of worrisome, if inconclusive, studies about the possible health risks posed by nanotech’s microscopic fibers and engineered particles, which, depending on who you ask, are either the key to future techno-prosperity or the harbingers of environmental and medical Armageddon. It’s even possible, Bergeson said, that a court might consider it a violation of current worker safety laws if a company is not maintaining detailed records of each employee’s exposure to nanomaterials, for reference years later should certain cancers or other ailments come to be associated with the high-tech materials.

In short, if you are a nanotech company you need to start developing a legal strategy for “how to protect yourself,” summarized Henry Chajet, an attorney with Patton Boggs. Listening, I felt sheepish for thinking it was about how to protect your employees and customers.

Truth be told, such defensiveness is understandable. Some critics have exaggerated the negative health implications of preliminary animal studies involving nanomaterials and have unfairly ignored the technology’s real promise. And plaintiffs’ attorneys already are boldly trolling the Internet for potential clients who believe they may have been harmed by nanotechnology.

“They are actively hunting for that next [equivalent to an] asbestos case, which, by the way, made them billions,” said James Chen of Crowell & Moring LLP, a DC-based food and drug law firm.

One of the best ways to stay clear of such lawsuits is to post adequate safety warnings for workers and consumers, Chajet advised, so that any user who eventually claims to have been harmed by the stuff can be argued in court to have been a “sophisticated user”—someone who was aware of the risks and took them anyway.

“‘Sophisticated user’ is a great defense,” Chajet said. “That’s how we’ve escaped liability for lots of clients.”

“Don’t test yourself out of a product.”

Nowhere is the nanotech industry’s nervousness about its own potential liability more apparent than in its relationship with regulators, several of whom also made presentations at the FDLI conference. Agencies such as the Environmental Protection Agency and the Food and Drug Administration are still trying to work out how nanotech fits into existing regulations, and whether new guidances or rules may be required to protect the public. That means that for now, at least, regulators are largely relying on their sparkling personalities and cajoling invitations to “come talk to us” just to find out what nano-companies are up to.

Not that any lawyer would encourage a company to participate.

“You can be the government’s guinea pig if you turn in a lot of data,” warned George Burdock, president of the Burdock Group, an Orlando-based consulting firm. While companies should do enough safety tests of their products to show they were reasonably diligent, Burdock added, they should not overdo it. “Don’t test yourself out of a product,” he advised.

Given warnings like that one, it should not be surprising that companies have hardly been lining up at regulator’s doors. Fewer than 30 companies have offered information under a one-year-old EPA program that asks nanocompanies to volunteer information. In the words of Jesse Barkas, a program attorney in EPA’s chemical control division, that’s “really pretty low participation.” What’s more, participating companies have ultimately provided “little actual data,” Barkas lamented. And for those of you who might want to know more, don’t come to the EPA. Much of what the companies provided is classified as “confidential business information” so is unavailable for public review.

Participation has been even lower for the agency’s voluntary “in-depth” program, in which companies are asked to divulge even more details about their products. Only four companies have volunteered, Barkas said. And although they have been generally forthcoming about the physical characteristics of their products, they have provided “very little data on eco-toxicity.”

All told, Barkas said, there is a “pretty big gap” between what the agency knows about nanoproducts and what is out there on the marketplace. The agency needs a lot more information, she said, “so we can get our arms around what it is we are regulating.”

In a few cases, nonetheless, the EPA has begun to use sticks as well as carrots. In March it will begin enforcing a decree that requires all manufacturers and importers of carbon nanotubes—some types of which have been shown to cause tissue damage similar to that caused by asbestos fibers—to notify the agency before releasing their products onto the market. Federal regulators also recently declared that they will demand tighter controls on nanoscale particles of titanium dioxide (used in paints and pigments) and alumina/silica, in recognition of the added health risks these ultrafine powders appear to pose compared to their larger particulate cousins.

Some states are also getting tougher. In January, California’s Department of Toxic Substances Control sent letters to the 27 companies and universities that it believes are manufacturing or importing carbon nanotubes, and asked a series of tricky legal questions such as: “When released, does your material constitute a hazardous waste under California Health & Safety Code provisions?”

“I’m not here to give legal advice,” said John Monica, of Porter Wright Morris & Arthur LLP, a Washington law firm, “but…God help you if you say ‘yes’ to that.”

Jim O’Reilly, of Baker & Daniels in Cincinnati, encouraged nanotech execs to hire a few experts to do enough basic studies so they can at least argue that they made a good effort to determine employee risks. The expense will pale in comparison to the cost of defending yourself in a tort case, he said, noting that “for one lawyer’s time you can hire four industrial hygienists.”

Given all the money being spent and made in the field of nano-liability, some are wondering aloud what they will do for a living if this self-sustaining element of the U.S. economy ever peters out. In the words of Donald Ewert, an environmental health and safety manager at Oso BioPharmaceuticals Manufacturing LLC in Albuquerque: “I’m wondering…what we’re all going to do when we find out that nanotechnology is not dangerous?”

But lawyers are nothing if not good at spotting the next income stream. “Synthetic biology!” one quickly shouted, referring to the controversial new science of making artificial bacteria and viruses from scratch.

Well, I’m not here to give legal advice. But if you think you’ve been harmed by a synthetic life form, there is definitely an attorney out there who wants to talk to you.

Rick Weiss is a Senior Fellow at the Center for American Progress and Science Progress.

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