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COURT HANDS CONSUMERS A MIXED BAG

Medical devices: The Supreme Court limits suits on federally approved units.

The Supreme Court on Wednesday made it harder for consumers to sue manufacturers of federally approved medical devices.

In an 8-1 decision, the court ruled against the estate of a patient who suffered serious injuries when a catheter burst during a medical procedure.

The case has significant implications for the $75-billion-a-year health care technology industry, whose products range from heart valves to toothbrushes.

In a recent three-month span, federal regulators responded to more than 100 safety problems regarding medical devices.

At issue before the Supreme Court was whether the estate of Charles Riegel could sue a company under state law over a device previously cleared for sale by federal regulators.

Under federal law, a company must substantiate the safety and effectiveness of a medical device before the U.S. Food and Drug Administration will approve it for the marketplace.

State lawsuits are barred to the extent they would impose requirements that are different from federal requirements, said the ruling by Justice Antonin Scalia.

In dissent, Justice Ruth Bader Ginsburg said that Congress never intended "a radical curtailment of state common-law lawsuits seeking compensation for injuries caused by defectively designed or labeled medical devices."

But Scalia, in response, said, "It is not our job to speculate upon congressional motives."

The Bush administration sided with industry, saying unfavorable state jury verdicts would compel companies to alter product designs or labels that had already gotten FDA approval.

The case is Riegel vs. Medtronic, 06-179.

401(k) losses: Employees can sue for recovery if plans are improperly handled.

The U.S. Supreme Court ruled Wednesday that employees with 401(k) plans can sue to recover losses when their savings are not handled in their best interest, a decision that could spark claims against the retirement system that now predominates in the workplace.

More than 50-million workers have nearly $3-trillion invested in 401(k) and similar retirement plans that rely heavily on employee contributions and do not guarantee benefits.

In the Supreme Court case, an employee named James LaRue said the Texas consulting firm that employed him failed to follow his instructions to shift his investments, costing him $150,000. Some experts said the decision could have far-reaching effects.

"This (decision) opens the door" to lawsuits in such contentious areas as fees charged by 401(k) and similar plans, and perhaps cases in which the share values of company stock take a plunge, said Ed Ferrigno, vice president of the Profit Sharing/401(k) Council of America.

Ferrigno said his 401(k) organization, which represents 1,200 companies whose plans cover 6-million workers, recognized the legitimate rights of workers. At the same time, he said, employers "don't want to be the victim of frivolous lawsuits."

In its decision, the Supreme Court overturned a ruling by the 4th U.S. Circuit Court of Appeals in Richmond, Va. The Supreme Court alluded to profound changes in the retirement landscape since the Employee Retirement Income Security Act of 1974, a time when pensions typically guaranteed payments for life.

"That landscape has changed," wrote Justice John Paul Stevens in his opinion for the court.

The case is LaRue vs. DeWolff, 06-856.

FAST FACTS

Other court news

On Wednesday, the Supreme Court:

-Invalidated parts of Maine's law barring Internet tobacco sales to minors, saying in a unanimous decision that the state cannot impose a regulatory scheme on transportation companies making door-to-door deliveries of tobacco products to consumers.

-Ruled 8-1 against the star of the syndicated TV show Judge Alex, saying that an arbitrator must decide the judge's fee dispute with an attorney who is claiming 12 percent of the earnings of Alex E. Ferrer, a former Florida Circuit Court judge who decides minor civil disputes as a form of TV entertainment.

-Decided 7-2 that state courts may apply the Supreme Court's rulings to old cases, opening the way for an imprisoned child sex abuser to challenge his conviction.

Associated Press

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