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Cutter Pharmaceutical goes to trial

 

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA

 

NTRODUCTION..

II.         JURISDICTION AND VENUE.

III.       PARTIES.

IV.       FACTUAL ALLEGATIONS APPLICABLE TO ALL CLAIMS.

A.        Hemophilia and Its Treatment

B.         Even Before the Discovery of HIV and AIDS, Defendants Failed to Disclose or Warn of Serious Adverse Effects Associated with Factor Concentrates.

C.        Defendants Recruited Plasma Donors from High Risk Populations to Manufacture Factor VIII and IX  

D.        Defendants Failed to Use the Available Hepatitis B Core (HBc) Test to Exclude Plasma from High Risk Donors.

E.         Defendants Also Failed to Implement Available Heat Treatment and Solvent Detergent to Kill BloodBorne Diseases.

F.         Defendants Continued to Ship Non-Heat Treated Factor Concentrate Products Abroad Even After They Stopped Selling Non-Heat Treated Product in the United States.

G.        Defendants Fraudulently Misrepresented the Safety of Factor VIII and IX and Concealed the Dangers of the Products.

H.        Defendants’ Activities Were Subject to Applicable Federal Regulations, Which Evidence the Standard of Care With Which Defendants Should Have Complied.

I.          Conspiracy, Concert of Action and Group Liability. 36

V.        CLASS ACTION ALLEGATIONS.

VI.       TOLLING OF APPLICABLE STATUTES OF LIMITATION..

VII.      CLAIMS FOR RELIEF.

First CLAIM FOR RELIEF:  NEGLIGENCE.

Second CLAIM FOR RELIEF:  NEGLIGENCE PER SE.

Third CLAIM FOR RELIEF:  FRAUDULENT OMISSION AND CONCEALMENT.

Fourth CLAIM FOR RELIEF:  BREACH OF IMPLIED WARRANTY..

VIII.     PRAYER FOR RELIEF.

DEMAND FOR JURY TRIAL.

 

 

 

Elizabeth J. Cabraser (State Bar No. 83151)

Robert J. Nelson (State Bar No. 132797)

Morris A. Ratner (State Bar No. 157554)

Fabrice N. Vincent (State Bar No. 160780)

Heather A. Foster (State Bar No. 184353)

Lexi J. Hazam (State Bar No. 224457)

Lieff, Cabraser, Heimann & Bernstein, LLP
275 Battery Street, 30th Floor
San Francisco, CA  94111-3339

Telephone:  (415) 956-1000

Facsimile:  (415) 956-1008

 

Charles Kozak (State Bar No. 141758)

LAW OFFICES OF CHARLES KOZAK
275 Battery Street, 30th Floor
San Francisco, CA  94111-3339

Telephone:  (415) 956-1000

Facsimile:  (415) 956-1008

Attorneys for Individual and Representative Plaintiffs

 

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA

DOMENICO GULLONE, MARCO MERCINELLI, ROBERTO MERCINELLI, FRANCA GAI, RICCARDINO GUALTIERO, BASTIAN GUTZEIT, CHRISTOF BARTH, ADRIAN MELSON, MAXINE MELSON, COLIN POTTS, HAYDN LEWIS, GAYNOR LEWIS, NORMAN KIDD, GARY WADE, and PAMELA BLACKWELL, on behalf of themselves and all others similarly situated,

Plaintiffs,

v.

BAYER CORPORATION, an Indiana corporation, successor to CUTTER BIOLOGICAL, a California Corporation; BAXTER HEALTHCARE CORPORATION, a Delaware corporation, and its HYLAND DIVISION; ARMOUR PHARMACEUTICAL COMPANY, INC., a Delaware corporation, AVENTIS BEHRING LLC, a Delaware corporation, and AVENTIS INC., a New Jersey corporation; and ALPHA THERAPEUTIC CORPORATION, a California corporation,

Defendants.

 

Case No. 

CLASS ACTION COMPLAINT FOR DAMAGES AND INJUNCTIVE RELIEF

Jury Trial Demanded

(1)  Negligence

(2)  Negligence Per Se

(3)  Fraudulent Omission and Concealment

(4)  Breach of Implied Warranty

I.                   INTRODUCTION

1.                  Plaintiffs’ claims arise out of the most egregious misconduct in the history of the pharmaceutical industry, which resulted in the killing of thousands of hemophiliacs worldwide, with a continuing death rate of hundreds of victims per year. Defendants are American corporations which manufactured blood products known as “Factor VIII” and “Factor IX” for the treatment of hemophilia, and sold these products to hemophiliacs worldwide, despite knowledge that the products were manufactured from sick, high risk donors and/or known to be contaminated with the viruses that cause AIDS and Hepatitis C (now known as HIV and HCV respectively).  Defendants continued selling these products to hemophiliacs abroad even after the products were no longer being used in the United States due to the known risk of AIDS and Hepatitis C transmission.  Plaintiffs are hemophiliacs from countries outside the United States who contracted HIV and/or Hepatitis C through use of Defendants’ contaminated products.

2.                  Defendants manufactured HIV and HCV-contaminated blood factor products at plants in the United States using human plasma taken from thousands of paid American donors, including populations then known to be at high risk of carrying blood-borne diseases, such as urban homosexuals, prisoners, and intravenous drug users.  Defendants intentionally recruited urban homosexuals who had a history of viral hepatitis as plasma donors, despite regulations prohibiting the use of such donors and despite knowledge that the viruses that cause AIDS and Hepatitis C were blood-borne diseases prevalent in such populations.  Defendants continued using plasma taken from high risk prison donors, including from prisoners at the notorious Angola prison in Louisiana, even after promising the FDA that they would cease doing so.  Through their trade associations, Defendants actively conspired to conceal these practices and to substantially delay product recalls and implementation of safety measures. 

3.                  Defendants failed to fully and completely disclose the known risks of their products, including the risk of AIDS and Hepatitis C; failed to implement readily available screening tests that would have prevented AIDS and Hepatitis C by excluding contaminated plasma; failed to use available methods of treating plasma to kill viruses, including heat treatment and solvent detergent; and concealed and affirmatively misrepresented the extent of the health dangers of the diseases caused by the products. Perhaps most egregiously, Defendants continued to ship non-heat treated product overseas even after ceasing to sell it in the United States, in order to maintain their profit margin on existing contracts and sell off remaining stock no longer marketable domestically.

4.                  Defendants’ efforts to maximize profits came at the expense of the health and lives of thousands of hemophiliacs worldwide who were needlessly infected with HIV and/or HCV.  AIDS is the leading cause of death for hemophiliacs who were treated with non heat-treated factor concentrate in the 1980’s, and the average life expectancy of hemophiliacs has decreased substantially.  As of 1992, Defendants’ contaminated blood products had infected at least 5,000 European hemophiliacs with HIV, of which 2,040 had already developed AIDS and 1,250 had died from the disease.  In the United Kingdom, 34% of hemophiliacs tested positive for HIV in 1992.   As of the mid-1990’s in Japan, hemophiliacs accounted for the majority of Japan’s 4,000 reported cases of HIV infection, and virtually all infections of Japanese hemophiliacs have been linked to contaminated blood products imported from the United States. In Hong Kong and Taiwan, over one hundred hemophiliacs were infected with HIV by Defendant CUTTER’s products alone.  In Latin America, at least 700 HIV cases are linked to use of contaminated blood products by hemophiliacs.  Thousands more around the world were infected with Hepatitis C from Defendants’ products.

5.                  Many surviving hemophiliacs with HIV suffer from AIDS.  Some have temporarily postponed AIDS with antiretroviral therapy, which has toxicities and side effects of its own and fades in effectiveness over time.  Those with Hepatitis C face cirrhosis and/or liver cancer unless they qualify for and respond to Interfeuron and Ribavirin combination therapy, a chemotherapy-like treatment with severe side effects, including major depression.  Coinfection with both HIV and HCV accelerates the advance of each disease and makes treatment of both riskier and more complicated.

6.                  Defendants’ wrongful conduct has not only damaged and shortened the lives of the hemophiliacs who used their contaminated products, but terribly affected their families and spouses as well.  Many infected hemophiliacs unknowingly transmitted HIV and/or HCV to their spouses, and in some cases their infected wives transmitted HIV to their children during pregnancy.  Other hemophiliacs have foregone having children, or their wives have aborted pregnancies, for fear of transmitting the disease to their children or of being unable to care for them.

II.                JURISDICTION AND VENUE

7.                  Plaintiffs, and each of them, allege an amount in controversy in excess of $75,000, exclusive of interest and costs. This Court has jurisdiction over this action pursuant to 28 U.S.C. § 1332 because there is complete diversity of citizenship between the Plaintiffs and the Defendants.

8.                  Plaintiffs are informed and believe and upon such information and belief allege that the unlawful, negligent and/or tortious activity alleged herein was carried out predominantly in the United States.  Defendants recruited high risk paid donors in the United States and mixed plasma from such donors into the blood pool at their facilities in the United States.  Defendants placed misleading labels on their products in the United States and made affirmative misrepresentations regarding their products’ safety in the United States, which were relied upon by Plaintiffs and their doctors worldwide. Defendants’ decisions to recruit paid donors from high risk populations, to refrain from disclosing the known risks of their products, to forego implementing readily available procedures that would have prevented their products from transmitting AIDS, and to ship their products overseas even after they could no longer be used domestically were all made in the United States.  Defendants’ acts of conspiracy, including trade association meetings where they agreed to engage in wrongful conduct, also took place in the United States. 

9.                  Plaintiffs are informed and believe and upon such information and belief allege that the vast majority of the evidence of the unlawful activity alleged herein is located in the United States.  Documents showing Defendants’ policies, practices, and decisions regarding recruitment of plasma donors, mixing of plasma into the blood pool at their facilities, labeling of their products, advertising and promotion of their products, disclosure or lack thereof of the risks posed by their products, implementation or lack thereof of procedures to prevent their products from transmitting AIDS, and shipment of their products overseas are located almost exclusively in the United States.  The vast majority of witnesses who will testify to these policies, practices, and decisions are also located in the United States, and would not be subject to subpoena in other countries.  The expert witnesses likely to be presented by both Plaintiffs and Defendants are also located in the United States.

10.              The named Plaintiffs’ medical records, as well as those of many class members, have already been brought to the United States and translated into English. In addition, witnesses to Plaintiffs’ damages, such as Plaintiffs’ family members, are willing to travel to the United States to testify.

11.              Because the named Plaintiffs and class members in this action reside in many different countries with differing legal systems, litigation in each of their home countries would be costly and inefficient and would pose the risk of inconsistent verdicts.  In addition, Plaintiffs’ home countries are inadequate alternative fora because of chronic and lengthy court delays, lack of open discovery, and unavailability of legal theories, procedures, and remedies, and lack of subpoena power over physical evidence in the United States.

12.              Plaintiffs are informed and believe and upon such information and belief allege that Defendants’ unlawful activity was carried out, in significant part, in the Northern District of California. Defendant CUTTER BIOLOGICAL (“CUTTER”), the predecessor of Miles, Inc. and Defendant BAYER CORPORATION (“BAYER”), had its headquarters in Berkeley, California at all pertinent times. CUTTER’s Biological Management Committee met at its Berkeley headquarters, and it was at its Berkeley headquarters that the decisions were made to recruit high risk homosexual donors from cities in California, including San Francisco’s drug-ridden Tenderloin neighborhood, and to ship blood products overseas.  In addition, at all times pertinent, Defendant BAXTER CORPORATION, and/or its HYLAND DIVISION, had its main manufacturing plant in Glendale, California.  HYLAND’s President, Medical Director, and Head of Donor Recruitment all had their offices in the Glendale facility.  Defendant BAXTER, and/or its HYLAND DIVISION, also recruited all their homosexual donors from California, particularly from San Francisco and Los Angeles.  All Defendants obtained plasma from plasma collection centers located in San Francisco and Oakland.

13.              Plaintiffs are informed and believe and upon such information and belief allege that the evidence of Defendants’ unlawful activity is located, in significant part, in the Northern District of California, where much of the unlawful activity was carried out.  The majority of documentary evidence on liability is located in a facility in San Jose.

III.             PARTIES

14.              This is a class action on behalf of Plaintiffs individually and as representatives of a class consisting of:

all persons residing outside the United States who used any non-heat treated blood factor concentrate manufactured, sold, or distributed by Defendants in the period from 1978 to 1990 and who contracted HIV and/or HCV; their infected spouses and children; and the estates of persons in the previous two categories who died on or after May 31, 2002 and/or have surviving children 18 years of age or younger.

This action seeks, among other relief, compensatory and punitive damages for class members who suffered the dangerous, severe and often fatal adverse effects of Defendants’ contaminated blood factor concentrate.

15.              Plaintiff Domenico Gullone is a citizen and resident of Italy and a hemophiliac who used Defendants’ factor concentrate and was infected with HIV and Hepatitis C and contracted AIDS by Defendants’ factor concentrate and/or as a result of Defendants’ conspiracy.

16.              Plaintiff Marco Mercinelli, the brother of Plaintiff Roberto Mercinelli, is a citizen and resident of Italy and a hemophiliac who used Defendants’ factor concentrate and was infected with Hepatitis C by Defendants’ factor concentrate and/or as a result of Defendants’ conspiracy.

17.              Plaintiff Roberto Mercinelli, the brother of Plaintiff Marco Mercinelli, is a citizen and resident of Italy and a hemophiliac who used Defendants’ factor concentrate and was infected with Hepatitis C by Defendants’ factor concentrate and/or as a result of Defendants’ conspiracy.

18.              Plaintiff Franca Gai, wife of Plaintiff Riccardino Gualtiero, is a citizen and resident of Italy who suffers from von Willebrand’s disease, a hemorrhagic disease similar to hemophilia, and who used Defendants’ factor concentrate and was infected with Hepatitis C by Defendants’ factor concentrate and/or as a result of Defendants’ conspiracy.

19.              Plaintiff Riccardino Gualtiero is a citizen and resident of Italy who was infected with Hepatitis C through sexual relations with his wife, Plaintiff Franca Gai, who used Defendants’ factor concentrate and was infected with Hepatitis C by Defendants’ factor concentrate and/or as a result of Defendants’ conspiracy.

20.              Plaintiff Bastian Gutzeit is a citizen and resident of Germany and a hemophiliac who used Defendants’ factor concentrate and was infected with Hepatitis C by Defendants’ factor concentrate and/or as a result of Defendants’ conspiracy.

21.              Plaintiff Christof Barth is a citizen and resident of Germany and a hemophiliac who used Defendants’ factor concentrate and was infected with Hepatitis C by Defendants’ factor concentrate and/or as a result of Defendants’ conspiracy.

22.              Plaintiff Adrian Melson, husband of Plaintiff Maxine Melson, is a citizen and resident of the United Kingdom and a hemophiliac who used Defendants’ factor concentrate and was infected with HIV and Hepatitis C by Defendants’ factor concentrate and/or as a result of Defendants’ conspiracy.

23.              Plaintiff Maxine Melson is a citizen and resident of the United Kingdon who was infected with HIV through sexual relations with her husband, Plaintiff Adrian Melson, who used Defendants’ factor concentrate and was infected with HIV and Hepatitis C by Defendants’ factor concentrate and/or as a result of Defendants’ conspiracy. 

24.              Plaintiff Colin Potts is a citizen and resident of the United Kingdom and a hemophiliac who used Defendants’ factor concentrate and was infected with HIV and Hepatitis C by Defendants’ factor concentrate and/or as a result of Defendants’ conspiracy.

25.              Plaintiff Haydn Lewis, husband of Plaintiff Gaynor Lewis, is a citizen and resident of the United Kingdom and a hemophiliac who used Defendants’ factor concentrate and was infected with HIV and Hepatitis C by Defendants’ factor concentrate and/or as a result of Defendants’ conspiracy.

26.              Plaintiff Gaynor Lewis is a citizen and resident of the United Kingdom who was infected with HIV through sexual relations with her husband, Plaintiff Haydn Lewis, who used Defendants’ factor concentrate and was infected with HIV and Hepatitis C by Defendants’ factor concentrate and/or as a result of Defendants’ conspiracy.

27.              Plaintiff Gary Wade is a citizen and resident of the United Kingdom and a hemophiliac who used Defendants’ factor concentrate and was infected with HIV and Hepatitis C by Defendants’ factor concentrate and/or as a result of Defendants’ conspiracy.

28.              Plaintiff Norman Kidd is a citizen and resident of the United Kingdom and a hemophiliac who used Defendants’ factor concentrate and was infected with HIV and Hepatitis C by Defendants’ factor concentrate and/or as a result of Defendants’ conspiracy.

29.              Plaintiff Pamela Blackwell is a citizen and resident of the United Kingdom who was infected with HIV through sexual relations with her husband, Dennis Blackwell, a hemophiliac who used Defendants’ factor concentrate and was infected with HIV by Defendants’ factor concentrate and/or as a result of Defendants’ conspiracy, and who died of the disease.

30.              The named Plaintiffs and class members contracted permanent injuries and diseases, including AIDS and/or Hepatitis C and associated symptoms and diseases, as a direct and proximate result of use of Defendants’ blood products and/or Defendants’ conspiracy.

31.              The named Plaintiffs and class members would not have chosen to have be treated with Defendants’ blood products had they known of or been informed by Defendants of the true risks of using those products or the nature of the sources of the blood products.

32.              Defendant CUTTER, the predecessor of Miles, Inc., and Defendant BAYER, was a California corporation headquartered in Berkeley, California at all pertinent times. At all pertinent times CUTTER and its successors Miles, Inc. and BAYER regularly and systematically engaged in the harvesting and collection of human plasma and the processing, manufacturing, marketing, sales and distribution of anti-hemophilic factor (hereinafter referred to as “AHF”) produced from such plasma, to which Plaintiffs were exposed and which contributed directly or indirectly to Plaintiffs’ infection with HIV and/or HCV.

33.              Defendant BAYER, formerly Miles, Inc., is and was an Indiana corporation, authorized to do business in all 50 states and the District of Columbia. Miles, Inc. had its principal place of business operation in Elkhart, Indiana, while its successor BAYER has its principal place of business in Pennsylvania, with offices located at 100 Bayer Road, Pittsburgh, Pennsylvania 15205. At all pertinent times BAYER and its predecessors Miles, Inc., and CUTTER regularly and systematically engaged in the harvesting and collection of human plasma and the processing, manufacturing, marketing, sales and distribution of anti-hemophilic factor (hereinafter referred to as “AHF”) produced from such plasma, to which Plaintiffs were exposed and which contributed directly or indirectly to Plaintiffs’ infection with HIV and/or HCV.

34.              Defendant BAXTER HEALTHCARE CORPORATION (hereinafter “BAXTER”) is a Delaware corporation, authorized to do business in all 50 states and the District of Columbia, with its principal place of business in Illinois, with offices located at One Baxter Parkway, Deerfield, Illinois 60015. At all times pertinent, Defendant BAXTER, and/or its HYLAND DIVISION, had its main manufacturing plant in Glendale, California.  In 1997, BAXTER acquired all assets and liabilities of Immuno International A.G., an Austrian company  that at all times pertinent sold AHF products worldwide which were produced from human plasma derived from paid donors in the United States. Immuno International A.G. operated in the United States at all times pertinent through its wholly owned American subsidiary Immuno-U.S., located in Rochester, New York. At all times pertinent, Defendant BAXTER, and/or its HYLAND DIVISION, and/or its wholly owned subsidiaries Travenol Laboratories and Fenwal Laboratories, regularly and systematically engaged in the harvesting and collection of human plasma and the processing, manufacturing, marketing, sales and distribution of AHF products produced from such plasma, to which Plaintiffs were exposed and which contributed directly or indirectly to Plaintiffs’ infection with HIV and/or HCV.

35.              Defendant ARMOUR PHARMACEUTICAL COMPANY, INC. is a Delaware corporation, authorized to do business in all 50 states and the District of Columbia, with its principal place of business in Pennsylvania, with offices located at 500 Arcola Road, P.O. Box 1200, Collegeville, Pennsylvania 19426-0107. In 1996 Defendant ARMOUR merged with Behringwerke A.G., a German company that at all times pertinent sold AHF products which were produced from human plasma derived from paid donors in the United States, to form Defendant AVENTIS BEHRING LLC, formerly Centeon Bio-Services, Inc., a Delaware company with offices located at 1020 First Avenue, King of Prussia, Pennsylvania, 19406. Defendant AVENTIS BEHRING LLC and its predecessors, Centeon Bio-Services, Inc. and Armour Plasma Alliance, Inc., are wholly owned subsidiaries of Defendant AVENTIS INC., formerly Rhone-Poulenc Rorer International, Inc., formerly Rorer Group, Inc., a Delaware corporation authorized to do business in all 50 states and the District of Columbia, with offices located at 300 Somerset Corporate Boulevard, Bridgewater, New Jersey, 088907. At all times pertinent, Defendants ARMOUR PHARMACEUTICAL COMPANY, INC., AVENTIS BEHRING LLC, and AVENTIS INC., (all of whom are described hereinafter collectively as “ARMOUR”) regularly and systematically engaged in the harvesting and collection of human plasma and the processing, manufacturing, marketing, sales and distribution of AHF products produced from such plasma, to which Plaintiffs were exposed and which contributed directly or indirectly to Plaintiffs’ infection with HIV and/or HCV.

36.              Defendant ALPHA THERAPEUTIC CORPORATION (hereinafter “ALPHA”) is a California corporation authorized to do business in all 50 states and the District of Columbia, with its principal place of business in California, with offices at 5555 Valley Boulevard, Los Angeles, California 90032. ALPHA is a wholly owned subsidiary of The Green Cross Corporation (hereinafter “Green Cross”), a Japanese business corporation. At all times pertinent Defendant ALPHA and its parent, Green Cross, have been regularly and systematically engaged in the harvesting and collection of human plasma and the processing, manufacturing, marketing, sales and distribution of AHF products produced from such plasma, to which Plaintiffs were exposed and which contributed directly or indirectly to Plaintiffs’ infection with HIV and/or HCV.

37.              Defendants CUTTER, ARMOUR, BAXTER and ALPHA (hereinafter collectively referred to as “MANUFACTURERS”) acting on behalf of themselves and/or their predecessor and/or successor corporations, collected, harvested and/or processed human plasma and/or manufactured, marketed, sold and distributed AHF products worldwide that were contaminated with HIV and/or HCV.  In the alternative, one or more of said Defendants participated in the collection, harvesting and/or processing of human plasma and/or the manufacturing, marketing, distribution and sale of AHF products worldwide, or assumed, became or are responsible for the liabilities of the Defendants and their predecessor or successor corporations who did participate in the collection, harvesting and/or processing of human plasma and/or the manufacturing, marketing, distribution or sale of AHF products worldwide, without limitation thereto.

38.              At all times herein mentioned, all Defendants and each of them, were fully informed of the actions of their agents and employees, and thereafter no officer, director or managing agent of Defendants repudiated those actions, which failure to repudiate constituted adoption and approval of said actions and that all Defendants and each of them, thereby ratified those actions.

IV.              FACTUAL ALLEGATIONS APPLICABLE TO ALL CLAIMS

A.                 Hemophilia and Its Treatment

39.              Hemophilia is an inherited condition that causes uncontrolled hemorrhaging or bleeding.  Hemophilia results from a deficiency of blood components essential for coagulation. The most common form of the disease is hemophilia A, characterized by a lack of a blood protein known as Factor VIII, which affects approximately one in 10,000 males. Factor VIII is commonly called “AHF,” or anti­hemophilic factor. Hemophilia B is characterized by absence of another blood protein, known as Factor IX, affecting about one in 40,000 males. Von Willebrand’s disease is an inherited hemorrhagic condition similar to hemophilia that affects both men and women. It is characterized by lack of both Factor VIII and another blood protein called von Willebrand’s factor.

40.              The treatment of hemophilia and von Willebrand’s disease involves intravenous introduction, called infusion, of the missing blood proteins required to stop bleeding. The two most prevalent forms of such treatment are cryoprecipitate, and factor concentrates.  Factor concentrates are the product made by Defendants in this action. Cryoprecipitate is made by freezing plasma, the fluid component of circulating blood in which various proteins, including Factor VIII and Factor IX, are contained; thawing the frozen plasma; and isolating Factor VIII from the plasma through centrifugal concentration. Cryoprecipitate is an effective therapeutic agent for patients with hemophilia A. Hemophilia B has been effectively treated with the use of fresh frozen plasma containing Factor IX. Cryoprecipitate and fresh frozen plasma are made from small numbers of donors, who are generally unpaid volunteers.

41.              By contrast, Defendants in the late 1960s to early 1970s began to market factor concentrates, or AHF, which contained Factor VIII and Factor IX in higher concentrations than had been available in either cryoprecipitate or fresh-frozen plasma. To produce factor concentrates, Defendants mixed pools of plasma from five to twenty thousand donors at a time, a substantial percentage of which were paid donors. These large pools were then subjected to chemical process to concentrate Factors VIII and IX.

B.                 Even Before the Discovery of HIV and AIDS, Defendants Failed to Disclose or Warn of Serious Adverse Effects Associated with Factor Concentrates

42.              Shortly after the initial commercial marketing of Factor VIII and IX concentrates in the late 1960s to early 1970s, a wide range of serious adverse effects were reported in association with these products. Even before the dissemination of HIV, Defendants knew of serious diseases caused by unidentified agents transmissible by blood and Factor VIII and IX. Defendants failed to warn Plaintiffs or the medical community of these adverse effects, in violation of industry standards and federal regulations.

43.              By 1976, only a few years after Defendants’ factor concentrate products went on the market, the United States Food and Drug Administration (“FDA”) Bureau of Biologics held a conference entitled “Unsolved Therapeutic Problems in Hemophilia.” The research articles compiled from the conference discussed the high incidence in patients using Defendants’ products of disorders such as liver dysfunction, enlarged spleen, Hepatitis B, and Non-A, Non-B Hepatitis (“NANB Hepatitis,” later renamed Hepatitis C).  The articles concluded that these disorders were tied to the patients’ use of factor concentrates, and emphasized the risks entailed in producing such concentrates using plasma from paid donors.  For instance, Robert Gerety of the FDA Bureau of Biologics, Division of Blood and Blood Products, reported that the agent or agents of NANB Hepatitis “appear to be blood borne, perhaps to be associated with a form of chronic hepatitis, and to represent a considerable risk to recipients who repeatedly require the administration of blood products.” (Gerety, et al., “Viral Antigens and Antibodies in Hemophiliacs,” (1)77). Gerety noted that “[t]he use of large plasma pools from paid donors no doubt contributes to the risk of HBV [Hepatitis B] infection from these products,” and stated that “an all voluntary blood donor system is being pursued as a result of the known increased risk of PTH [post-transfusion hepatitis] from blood derived from commercial donors.” As described below, however, Defendants not only refused to implement such a voluntary donor system, but instead recruited paid donors precisely because their hepatitis exposure resulted in plasma from which Defendants could make other commercially valuable products as well.

44.              Several of the articles from the 1976 conference also raised alarm over the unprecedented convergence of immune disorders in the hemophiliac community, and called for close medical monitoring of the situation.  Dr. Peter Levine stated, “one wonders whether our patients are suffering a sort of immune complex disease as a result of intensive bombardment with foreign antigens....” (Levine, “Unsolved Problems with Current Therapeutic Regimens for Hemophilia,” (1977)). Shapiro warned of the possibility that “a new spectrum of disease may be seen in this population” and urged that it “behooves us to follow the suggested findings very closely over the coming years.” (Shapiro, “Antibody Responses in the Hemophiliac,” (1977)). Seeff concurred that “it is evident that continued surveillance of the hemophiliac population is mandatory.” (Seeff, “Acute and Chronic Liver Disease in Hemophilia,” (1977)).

45.              At all times material to this Complaint, Defendants failed to adequately warn Plaintiffs or their physicians of these serious adverse side effects. Several such adverse effects, including immunosuppression (suppression of the immune system) were not mentioned at all in the Defendants’ package inserts, which were required to disclose adverse reactions pursuant to federal statutes and regulations and applicable standards of care. Although Defendants’ inserts mentioned a risk that plasma “may” contain the causative agent of viral hepatitis, the warning was seriously deficient in that: (a) Defendants failed to disclose that the risk of hepatitis was essentially a 100% guarantee due to their practices of using high-risk donors and specifically recruiting for donors who had previously been exposed to Hepatitis B; (b) while “hepatitis” simply means inflammation of the liver, and may be a relatively benign, temporary condition, Defendants failed to warn that some forms of hepatitis transmitted by their products were believed to present a considerable risk of severe liver damage, cirrhosis, and significantly elevated risk of cancer; (c) Defendants misleadingly stated that the source plasma used in preparation of the product had been found to be non-reactive for Hepatitis B surface antigen (HBsAg)—implying that no viral hepatitis was present in the plasma—and falsely stated that available methods were not sensitive enough to detect all units of potentially infectious plasma, while failing to disclose that Defendants had refused to implement the more sophisticated Hepatitis B Core Antibody (HBc) test which would have excluded essentially all plasma contaminated by Hepatitis B; and (d) Defendants’ labeling disclosed that the product was made from large pools of fresh human plasma, but failed to disclose that paid donors increased the risk of disease, and that the particular groups of paid donors targeted by Defendants were known to be the highest risk groups available.

C.                 Defendants Recruited Plasma Donors from High Risk Populations to Manufacture Factor VIII and IX

46.              The demand for and supply of anti-hemophilia factor rapidly increased during the 1970’s, with the commercially-manufactured concentrate accounting for a large proportion of the increase in supply.  In 1977, a federal report projected that the volume of AHF manufactured would increase substantially by 1980. (“Study to Evaluate the Supply-Demand Relationships for AHF and PTC Through 1980,” Division of Blood Diseases and Resources, National Heart, Lung and Blood Institute (1977), at page 8; hereinafter “NHLBI Report”).   

47.              In order to sell more AHF to this growing market, Defendants turned to the fastest and cheapest way of obtaining sufficient plasma, paid donors.  Defendants recruited paid donors from those populations most likely to respond to the financial incentive to donate:  poor inner city residents, drug abusers, prisoners, and even residents of impoverished developing countries such as Haiti and Nicaragua.   

48.              Defendants purposefully sought out paid donors despite knowing that the risk of diseases transmissible by blood was far greater among paid donors than among volunteers.  Because no test was available yet for the NANB Hepatitis virus identified in the early 1970’s, the only means to prevent the virus from contaminating the plasma supply was to exclude donors with behaviors that were inconsistent with good health—precisely those populations from which Defendants were recruiting paid donors.  Some studies indicated that paid donors were up to ten times more infectious than volunteer donors.  For this reason, the National Blood Policy, adopted by the federal government in July 1973, advocated conversion to an all-volunteer blood supply. Defendants, however, not only continued to use paid donors, but also focused their recruiting efforts on the highest risk populations.

49.              Defendants had an additional financial incentive for recruiting paid donors.  Factor VIII and Factor IX are only two of many products that can be made for commercial sale from human plasma. According to the NHLBI Report, by the late 1970s at least 17 different therapeutic components of blood were manufactured by the process of “fractionating” plasma into its various elements. The NHLBI Report noted that, “as the costs of fractionation have increased, fractionators have produced as many products as possible from a liter of plasma.” (Id. at 65).

50.              Blood derivatives used as vaccines or therapeutics had particularly high economic value for Defendants. The NHLBI Report noted that plasma with a very high titer, or antibody level, for a corresponding antigen is “very expensive.” (Id. at 41). Such products are manufactured from source plasma drawn from donors who have been sensitized to a particular antigen. (Id.). The NHLBI Report specifically stated, however, that “plasma collected for high antibody titer cannot be used for fractionation into therapeutic products,” such as Defendants’ factor concentrate. (Id., emphasis added).

51.              Defendants targeted donors with high titers to Hepatitis B antigens in order to manufacture and sell Hepatitis B immunoglobulin (HBIG), a product that confers temporary immunity to the Hepatitis B virus.  Despite the warning in the NHLBI report, Defendants’ used the same high titer plasma they obtained for making HBIG to manufacture the Factor VIII and IX products used by hemophiliacs. Defendants thus sought to maximize profits by producing “as many products as possible from a liter of plasma,” while ignoring industry standards that precluded the use of high-titer plasma for other therapeutic products.

52.              Beginning in about 1978, Defendants BAXTER, CUTTER and ALPHA began targeting homosexual donors in known urban gay communities. Because urban homosexuals had been reported in the 1970’s to have exceptionally high prevalence of Hepatitis B infection, Defendants knew that such donors would provide a reliable source of plasma for the manufacture of commercially valuable HBIG. 

53.              It was also well-known in the public health community by the 1970’s that urban homosexuals engaged in promiscuous sexual practices that rapidly transmitted other diseases, including NANB Hepatitis, which were transmitted by blood, could not be isolated nor identified, and were believed to have serious adverse consequences.  Despite this knowledge, Defendants used the same plasma pool from urban homosexuals to manufacture both HBIG and Factor VIII and IX. 

54.              Defendants continued this dual use of high risk plasma even after federal reports warned of the rapid spread of fatal immunosuppressive disease among the same homosexual population from which Defendants heavily recruited. On June 5, 1981, the United States Centers for Disease Control (“CDC”) reported that five homosexual men had unusual and similar immunosuppressive disorders (Morbidity and Mortality Weekly Report, hereinafter “MMWR,” June 5, 1981, at p. 250). On July 3, 1981, the CDC reported similar diseases in 26 homosexuals, noting that all 12 patients tested for cytomegalovirus (“CMV”) had evidence of “past or present CMV infection,” and that past infections with hepatitis “were commonly reported.” (MMWR, July 3, 1981, at p. 305). The CDC warned doctors to be alert for “opportunistic infections associated with immunosuppression in homosexual men.” (Id., at p. 307). By August 28, 1981, less than two months later, the reported figure had grown to 108 cases and 40% fatalities; 94% of the 101 males were homosexual or bisexual (MMWR, August 28, 1981, at p. 409). Based on this evidence and the high prevalence of hepatitis in the same population, Defendants knew or should have known by no later than the summer of 1981 that urban homosexual males were not “suitable donors” within the meaning of federal regulations and/or other applicable standards of care.

55.              By the 1970s, it was also well-established that plasma from prison populations carried a high risk of hepatitis and other blood-borne diseases, primarily because of the concentration of intravenous (IV) drug users in prisons.  By 1974, the alanine aminotransferase (“ALT”) test was available to test for elevated levels of liver enzymes called SGOT that indicate the presence of hepatitis.  Prisoners were associated with SGOT levels of over 60 IUs per ml, a level that increases the risk of Hepatitis C transmission by a factor of 6.  Despite knowledge of this risk, Defendants actively recruited prisoners for plasma used to manufacture Factor VIII and IX, while concealing or failing to disclose the risk to Plaintiffs, their physicians, or the FDA. 

56.              On June 11, 1982, the CDC reported that 281 homosexual men and 33 IV drug users had been diagnosed with similar immunosuppression and opportunistic infections, with a 43% fatality rate. Yet Defendants continued to recruit these high risk donors while concealing the risk from Plaintiffs, their physicians and the FDA. It is highly significant that only Defendants had knowledge of this risk; while the spread of disease in homosexuals and IV drug users became known to the FDA and the public, only Defendants knew that these very populations were target donors for plasma used to make Factors VIII and IX.

57.              At a July, 1982 meeting attended by Defendants, the CDC publicly reported the first three cases of opportunistic infections among individuals with hemophilia. All three were reported to be heterosexual males. The CDC reported that the clinical and immunologic features of the three patients were strikingly similar to those recently observed among homosexual males and heterosexual IV drug users, while noting that the hemophilia patients did not share the latter two groups’ risk factors. The CDC stated, “Although the cause of the severe immune dysfunction is unknown, the occurrence among the three hemophiliac cases suggests the possible transmission of an agent through blood products.” (MMWR, July 16, 1982, at p. 366).

58.              In light of Defendants’ special knowledge of the disease patterns among urban homosexuals and prisoners, and their recruitment of such donors for Factor VIII and IX manufacture, Defendants had duties to: (a) promptly investigate the first reports of opportunistic infections among urban homosexuals in 1981; (b) discontinue the practice of using such high risk donors; (c) disclose the risk to Plaintiffs, their physicians, and the FDA, including the ongoing risk of continuing to use Factor VIII and IX previously manufactured with high risk plasma and still marketed to patients; (d) implement procedures to kill blood-borne diseases in the products; and (e) recall existing products from distribution or further use. Instead, Defendants continued to conceal their recruitment of high risk donors and resist warnings and recalls, and failed to implement procedures to make their products safe.

D.                Defendants Failed to Use the Available Hepatitis B Core (HBc) Test to Exclude Plasma from High Risk Donors

59.              By no later than 1978, Defendants knew of the availability of a new test to determine whether an individual had a history of viral Hepatitis, which would have disqualified the donor from providing plasma for the manufacture of Factor VIII or IX. By testing a person’s serum for the presence of the core to the Hepatitis B antibody, a history of viral Hepatitis could be verified. This was known as the “HBc test.” Published, peer-reviewed literature shows that the HBc test was in use by researchers to determine that homosexual AIDS victims had a history of viral Hepatitis by no later than December 1981. (Gottlieb, et al., “Pneumocystis Carinii Pneumonia and Mucosal Candidiasis in Previously Healthy Homosexual Men,” NEW ENGLAND JOURNAL OF MEDICINE 1981; 305:1425-1431).

60.              Use of the HBc test would have eliminated approximately 75% of homosexual plasma donors and over 90% of promiscuous urban homosexuals. It would have eliminated almost 100% of intravenous drug users.

61.              Use of the HBc and ALT tests by Defendants by 1981 would have eliminated the vast majority of the transmitters of HIV and HCV from the blood and plasma pools of the nation, before the height of the AIDS and Hepatitis C epidemics. If Defendants had implemented this test in a timely manner, Plaintiffs would never have been infected with HIV or HCV or suffered from AIDS or Hepatitis C as a result of factor concentrate use.

62.              Plaintiffs and thousands of other hemophiliacs worldwide became infected by the AIDS and Hepatitis C viruses through repeated exposures from blood products manufactured from large pools of plasma donors (5,000 to 40,000). If Defendants had used the HBc and ALT tests to decrease by 70% to 90% the number of HIV and HCV positive donors who went into a pool, the infectivity of the product would have decreased substantially. Consequently, the rate of infection of hemophiliacs would have slowed down enormously, and the medical and scientific community would have been given more time to react appropriately to the HIV and Hepatitis C epidemics.

63.              As noted below, federal regulations required plasma donors to be in good health, and donors with a “history of viral Hepatitis” were by definition unacceptable as blood or blood plasma donors. Persons with a history of viral hepatitis were excluded not only because of the risk of transmitting Hepatitis B, but because such a history indicated a lifestyle or previous behavior of the prospective donor which carried the risk of transmitting other viruses in addition to hepatitis. A reasonable and prudent plasma fractionator would not accept a HBc positive donor and expect to be in compliance with federal regulations as of 1978.

64.              After public reports of the first hemophilia AIDS cases in July 1982, government officials urged Defendants to implement the HBc test as a “surrogate” or “marker” to eliminate plasma contaminated by the transmitter of AIDS or Hepatitis C.  HBc testing was also strongly suggested to Defendants by the CDC at a meeting of the United States Public Health Service (“PHS”) on January 4, 1983.  Despite this urging, Defendants continued to use contaminated plasma donations that would have been excluded by the HBc test and continued to conceal from Plaintiffs, their physicians, and the FDA the dangerous practice of targeting donors at highest risk for the very diseases that disqualified their plasma. At a January 6, 1983 meeting of Defendants’ trade association, the Pharmaceutical Manufacturer’s Association, Defendants agreed not to implement the highly effective HBc donor screening, and instead opted to use ineffective donor questionnaires that did little to screen out donors at high risk for AIDS and Hepatitis C transmission. 

65.              As late as December 13, 1983, years after the HBc test was available, a memorandum from CUTTER’s responsible head Stephen Ojala to various CUTTER executives, reporting back on a meeting held by all Defendants, shows that all Defendants conspired to propose a “task force” to further study the use of HBc as an intentional, bad faith “delaying tactic for the implementation” of the test.

E.                 Defendants Also Failed to Implement Available Heat Treatment and Solvent Detergent to Kill Blood­Borne Diseases

66.              In the late 1970s and early 1980s, it was recognized that viruses were in all AHF products, including Factor VIII and IX. Heat treatment and solvent detergent was available at that time to eliminate many of these viruses, including HIV and HCV. Defendants were required to take reasonable steps to eliminate contamination, but Defendants failed to utilize these available technologies to eliminate the viruses in a timely manner.

67.              The 1977 NHLBI Report noted that albumin, another plasma product, was “heat treated to remove almost all danger of hepatitis.” (Id., at p. 49). Defendant ARMOUR’S memorandum of June 1983 acknowledged that no cases of AIDS had been reported in heat-­treated albumin users, but misleadingly states that heat treatment of Factor VIII and IX was not yet feasible. It was clearly known by no later than 1977 that heat treatment was an effective way to make blood products safer, but Defendants wrongfully refused to implement such procedures as to Factor VIII and IX. In 1995, the National Institutes of Health Institute of Medicine (“IOM”) issued a report on the hemophilia AIDS epidemic which concluded that defendants “did not seriously consider alternative inactivation processes,” including heat treatment, and that “heat treatment processes to prevent the transmission of hepatitis could have been developed before 1980.” Heat treated, HIV-safe factor concentrates were not introduced by any Defendant until 1983, and were not universally in use until 1985.

68.              In addition to heat treatment, solvent detergent treatment was available to Defendants by the late 1970’s as a simple and effective method of eliminating viruses in their factor concentrate products.  Solvent detergent effectively kills viruses such as HIV and HCV by destroying the viruses’ lipid envelope. It is simpler than heat treatment, and unlike heat treatment does not interfere with the Factor VIII and IX proteins needed for blood clotting. 

69.              Solvent detergents were well-known, commercially available products as of the 1970’s, and studies in which solvent detergent treatment was used to disrupt viruses were published in the 1970’s in peer-reviewed journals.  In 1980, Dr. Edward Shanbrom, a former BAXTER scientist, received a patent for a solvent detergent treatment process for viral inactivation of factor concentrate.  After receiving the patent, Dr. Shanbrom approached all four Defendants about implementing the solvent detergent method, but all four Defendants wrongfully refused to implement the method.

F.                  Defendants Continued to Ship Non-Heat Treated Factor Concentrate Products Abroad Even After They Stopped Selling Non-Heat Treated Product in the United States

70.              Between 1983 and 1985, Defendants stopped selling non-heat treated factor concentrate in the United States and introduced a vastly safer heat-treated version.  However, one or more Defendants continued to ship their remaining stocks of non-heat treated product abroad after ceasing sales of such product in the United States, despite knowledge that the non-heat treated product was contaminated with HIV and/or HCV.

71.              According to a New York Times article entitled “2 Paths of Bayer Drug in 1980’s: Riskier Type Went Overseas,” published on May 22, 2003, CUTTER, BAYER’s predecessor, sold millions of dollars of non-heat treated factor concentrate in Asia and Latin America for over a year after introducing its heat-treated product in the United States in February, 1984.  According to the article, CUTTER records show that the company sought to maintain its profit margin on “several large fixed-price contracts” in Latin America and Asia, and avoid being stuck with old, unmarketable stock, by continuing to sell its cheaper-to produce non-heat treated factor concentrate.  Minutes from a CUTTER meeting in November, 1984 stated that “there is excess nonheated inventory,” and that the company planned to “review international markets again to determine if more of this product can be sold.”  The company pursued this strategy even though, according to the Times article, CUTTER’s manager for plasma procurement had acknowledged in a letter in January, 1983 that “[t]here is strong evidence to suggest that AIDS is passed on to other people through … plasma products,” and despite its knowledge that the CDC  had reported in October, 1984 that 74 percent of hemophiliacs who used unheated product were HIV positive.  The same CDC report indicated that a study done with CUTTER showed that heat treatment rendered HIV “undetectable” in factor concentrate.

72.              According to the Times article, in late 1984 CUTTER told a Hong Kong distributor interested in its new heat-treated product to “use up stocks” of its old, non-heat treated product first.  CUTTER later assured the same distributor that the non-heat treated product posed “no severe hazard.”  In March 1985, a CUTTER report stated that “the Far East has ordered 400,000 units” and that “in Taiwan, Singapore, Malaysia, and Indonesia, doctors are primarily dispensing nonheated Cutter” factor concentrate.  CUTTER did not apply for a license to sell its new heat-treated product in Taiwan until July 1985, over a year after it began selling the new product in the United States.  According to the Times article, over 100 hemophiliacs in Hong Kong and Taiwan alone were infected with HIV by non-heat treated CUTTER product sold after February, 1984.

73.              The March, 1985 CUTTER report additionally states that “Argentina has been sold 300,000 units,” according to the Times article.  A total of 100,000 vials, or $4 million dollars worth, of non-heated CUTTER concentrate was shipped abroad after the company began selling its heat-treated product in the United States. 

74.              CUTTER’s wrongful conduct in continuing to ship non-heat treated factor concentrate abroad after ceasing sales of such product in the United States is typical of all Defendants’ wrongful conduct worldwide.  The Times article reports that upon learning of this conduct in May, 1985, the FDA requested a meeting with Defendants to order them to comply with their voluntary agreement to withdraw non-heat treated product from the market.  According to the Times article, Dr. Harry M. Meyer, at that time the FDA’s regulator of blood products, stated in later legal papers that “[i]t was unconscionable for them to ship that material overseas.”

G.                Defendants Fraudulently Misrepresented the Safety of Factor VIII and IX and Concealed the Dangers of the Products

75.              Defendants engaged in a pattern and practice of fraudulent concealment of their dangerous practices, fraudulent misrepresentations of the extent of their efforts to assure safety, and fraudulent misrepresentations that understated the risk of AIDS and Hepatitis C, in order to maintain profits from both factor concentrates and HBIG. A summary of Defendants’ fraudulent misrepresentations and concealment is set forth below.

76.              On July 27, 1982, a meeting of the Public Health Service was held as the result of the CDC’s report of three hemophiliacs who contracted AIDS. The responsible heads of ARMOUR, ALPHA, CUTTER and BAXTER were in attendance, along with officials from the National Hemophilia Foundation, CDC and FDA. Three of the four Defendants were aware that they had used cryoprecipitate containing plasma from known, targeted homosexuals in the manufacture of Factor VIII and IX blood products. These products had a shelf life of two and three years, respectively, and were either in production or already on the shelves in pharmacies waiting to be infused by hemophiliacs who purchased them. The Defendants involved, CUTTER, BAXTER and ALPHA, failed to disclose these facts at the meeting where CDC officials Dr. Don Francis and Dr. Jeff Koplin were present, despite knowledge that the CDC’s primary concern at that meeting was the infection of Factor VIII and IX by the transmitter of AIDS, which was already well-known to be epidemic in the targeted homosexual population. (CUTTER memorandum dated August 3, 1982)

77.              In or about December, 1982, Rodell, the responsible head for BAXTER, entered into an agreement with officials of the FDA to the effect that BAXTER would no longer use prison plasma in the production of factor concentrates. In fact, BAXTER, unbeknownst to the FDA, continued to use prison plasma in factor concentrate production through October 1983. (BAXTER memorandum dated October 20, 1983.)

78.              On January 5, 1983, an AIDS meeting was held at Children’s Orthopedic Hospital in Los Angeles, California, the largest hemophilia treatment center in the United States. Representatives of all four Defendants were present at the meeting with treaters and patients. The purpose of the meeting was to have Defendants’ representatives answer patients’ questions about AIDS transmission through factor concentrates. A patient asked representatives from CUTTER, ALPHA, ARMOUR and BAXTER the following question: “Is the plasma from homosexuals, prisoners, Haitians or other high risk persons being used in the manufacture of concentrates?” No Defendants admitted targeting or using plasma from homosexuals, prisoners or inner city IV drug abusers. Dr. Goodman from BAXTER answered regarding BAXTER’S use of known homosexuals as follows: “We are changing the nature of questions to homosexuals to the best of our ability.” CUTTER’S responsible head, Stephen Ojala, an ALPHA representative, and ARMOUR’S Karl Hansen made no response to the question. This partial and misleading response amounted to concealment of the true risk created by the use of known homosexuals, IV drug abusers and prisoners in the manufacture of factor concentrates.

79.              At the January 5, 1983 meeting, and in the presence of the patients, one of the treating physicians, Dr. Kasper, asked CUTTER’S Stephen Ojala: “These [plasma] centers seem to be in rundown centers of town. Is there a move to move them to rural towns?” Ojala answered: “Many of the centers are in smaller communities and in towns such as Ypsilanti, Seattle, Clayton, NC., and San Diego. We do not have centers in L.A. or San Francisco.” This answer was misleading because Ojala failed to state that CUTTER’S largest and first plasma center was located at Arizona State Penitentiary. CUTTER also had a center at the Las Vegas Prison. Ojala and CUTTER were well aware of the CDC’s and FDA’s concern over use of prison plasma, due to homosexual practices and drug abuse in the prison donor population. Many of CUTTER’S centers were in inner city areas frequented by IV drug abusers, such as downtown Oakland, California. CUTTER had also used plasma from centers which targeted known homosexuals. In August 1982, CUTTER quarantined plasma from the Valley Medical Center, a center which targeted known homosexuals, because a donor was hospitalized with full blown AIDS. The plasma was intended for Factor IX and HBIG production, but was not used because it had thawed on the way to the processing plant. Upon receiving a report of this incident from CUTTER, the FDA indicated a recall might have been necessary if the plasma had been incorporated into factor concentrate final product. Ojala omitted any mention of these facts and circumstances in his response to Dr. Kasper regarding the location of their plasma centers. (CUTTER memorandum dated January 5,1983.)

80.              On January 14, 1983, Dr. Michael Rodell and the other responsible heads from the four Defendants attended a meeting of the National Hemophilia Foundation (“NHF”). The purpose of the meeting was to have Defendants explain to the NHF what steps they were prepared to take to safeguard the plasma supply from potential AIDS transmitters. Defendants were very concerned that the NHF would insist on a recommendation that HBc testing be implemented, consistent with the CDC recommendation 10 days earlier. BAXTER, under Rodell’s supervision, had already conducted a survey of several of their donor centers to determine how many donors they would lose if the test were implemented. BAXTER had decided that up to 16% of their donors would not pass the test. Further, BAXTER’S high titered immunoglobulin donors would be eliminated. In order to defer an NHF recommendation that HBc testing be used, Rodell told NHF officials that surrogate testing was in the “R and D,” or “Research and Development,” stage currently. Rodell concealed the fact that the CDC had strongly recommended use of the HBc Antibody test as a screening device for donors at high risk for AIDS transmission. The HBc Antibody test was not in the “R and D” stage, and was suitable for use as a screening device for high risk AIDS and Hepatitis C donors. In fact, the HBc test had been approved in 1979 by the FDA as a diagnostic test to be used to ascertain a history of previous hepatitis B infection, and as a screening device for blood and plasma donors. The test had the capability of identifying all donors with a history of viral hepatitis. Donors with a hepatitis history were specifically prohibited pursuant to the federal regulations (21 C.F.R. § 640.63). Rodell acknowledged that implementation of the HBc test would eliminate high titered immunoglobulin donors, but failed to disclose that opposition to use of the test was based on economic rather than safety concerns.

81.              At the January 14, 1983 meeting, ALPHA, CUTTER and BAXTER concealed their advertising in publications distributed among urban homosexuals, for the specific purpose of attracting them to plasma centers which supplied high titered plasma to the Defendants.  CUTTER and ALPHA concealed their extensive use of prison plasma, and BAXTER discussed plans to phase out prison plasma during the coming year. However, none of the Defendants revealed their “gentlemen’s agreement” with the FDA to discontinue use of these plasma sources immediately. (CUTTER Memorandum dated January 17, 1983.)

82.              In response to the growing concern by hemophiliacs regarding reports in the lay press of AIDS transmission through blood products, CUTTER issued a press release dated January 28, 1983. The press release stated, “Cutter has intensively involved its people and resources to contribute to a resolution of this segment of the AIDS problem.” This statement was false because CUTTER was, or had been, actively engaged in using the plasma of prisoners, known homosexuals and inner city IV drug abusers in the manufacture of factor concentrates. CUTTER had refused to comply with the CDC’s recommendation to immediately implement the HBc test to screen out these high risk donors, and was engaged in a conspiracy with the other Defendants to conceal use of these donors in factor concentrates that were currently on the market. CUTTER had formed an alliance with the other three Defendants to avoid timely warnings, effective donor screening, and immediate recalls of high risk blood products. (ALPHA Memorandum dated January 20, 1983.)

83.              CUTTER published and distributed a magazine called ECHO, which was intended for patients, treaters and pharmacies. The May 1983 issue of ECHO Magazine was entitled, “Special AIDS Issue.” In the introductory statement by CUTTER Medical Director Dr. George Akin, the following representation appeared: “We at Cutter want you to know that your welfare is our prime concern. We are doing everything possible to help researchers diagnose the syndrome as well as implement precautionary measures designed to minimize the risk for the person with hemophilia.” This statement was false because:

a.                   CUTTER had engaged in concerted actions with the other three companies to avoid recalls, timely warnings, appropriate HBc testing and screening of donors, and the flow of accurate information through the NHF. They were engaged in aggressive overpromotion of Factor VIII calculated to understate the risk of AIDS and Hepatitis C in order to increase sales, which had dropped due to information reported in the lay press regarding the risks of AIDS transmission. CUTTER, through its responsible head, Steven Ojala, was in the process of organizing a coordinated legal defense plan to defend claims from AIDS victims they anticipated as the result of their sales increases in 1983-84.  In a January 1983 memorandum, CUTTER discussed its plan to “refute links to AIDS.”

b.                  CUTTER had failed to conduct any independent investigation into any hemophiliac AIDS patient. CUTTER had been told by two of the foremost authorities in the field, Dr. Lou Aledort and Dr. Peter Levine, that AIDS may be caused in hemophiliacs by foreign proteins and alloantigens as well as unidentified viruses in the product, rendering continued use of the products extremely dangerous. The product had been previously associated with chronic active hepatitis, splenomegaly, lymphadenopathy, severe thrombocytopenia, T-cell abnormalities, and high levels of circulating immune complexes. Older hemophiliacs were at increased risk for full blown AIDS. These facts indicated that the more product infused, the higher the risk of contracting AIDS.

c.                   Dr. Bruce Evatt of the CDC had informed CUTTER on March 15, 1983 that based upon the observed T-cell abnormalities in hemophiliacs, he expected one half of them to develop full blown AIDS. The four fractionator Defendants were engaged in meetings with the FDA with a common goal of averting a complete recall, the only responsible option available to them.

d.                  CUTTER’S Dr. Akin did not reveal that CUTTER was using or had used a substantial amount of prison plasma, plasma from known homosexuals with a history of Hepatitis B, and inner city dwellers with a high risk for intravenous drug abuse. These practices exponentially increased the risk of AIDS and Hepatitis C, in direct contradiction to CUTTER’S misrepresentation that it was doing everything possible to minimize the risk.

84.              In the May 1983 issue of ECHO, CUTTER published an article entitled “AIDS, the Unfolding Story,” in which the following statement appeared: “In addition, NHF is working collaboratively with the CDC on a nationwide epidemiologic survey of all hemophilia treatment centers and affiliates, and has obtained special federal funding for AIDS research for the CDC plus increased funding for NIH.” This statement was misleading because it did not reveal the fact that the epidemiologic survey by the CDC and the NHF demonstrated that heavy users of Factor VIII were displaying severe immune abnormalities and T-Cell imbalances, while cryoprecipitate users were not displaying these abnormalities. The article does not disclose that the CDC considered these hemophiliacs to be at increased risk for AIDS because of the immune abnormalities reported in the survey by December, 1982. The statement was also misleading because the NHF was presented as an independent authority, when the NHF was essentially a channel for industry views. In fact, a 1993 report by the U.S. NIH Institute of Medicine concluded that the NHF had serious “conflicts of interest” precluding objective analysis because of its “interdependence” with the Defendants.

85.              In the May 1983 ECHO article, CUTTER also understated the risk of AIDS by presenting the view of Dr. Louis Aledort, Medical Co-Director of the NHF, and hemophilia treater from New York’s Mount Sinai Hospital. Dr. Aledort stated in the article, “Put AIDS Disease in Perspective,” as follows: “AIDS should not be viewed as a “panic signal” or a reason to change a hemophilia patient’s therapy.” CUTTER chose to print this statement in enlarged text. The statement was false and misleading because many physicians had in fact already changed their patient’s therapy based on scientific evidence of AIDS being cause by Factor VIII and IX. There was substantial evidence to justify a change in therapy and a complete recall of unscreened Factor VIII by May 1983.

86.              Dr. Aledort’s article in the ECHO of May 1983 went on to state: “There is no evidence to support that AIDS is transmitted in either cryoprecipitate or concentrate, although it is possible.” This statement was directly contrary to the evidence which led the Public Health Service (“PHS”) to conclude, following the January 4, 1983 CDC meeting, that donors at risk for AIDS transmission should be screened to eliminate them from the blood supply. The statement also ignores the March 24, 1983 PHS recommendations regarding mandatory screening guidelines for blood and plasma donors to reduce the risk of AIDS transmission, because of the evidence supporting transmission of AIDS in factor concentrate. It is also contrary to Dr. Aledort’s repeated assertions, in sworn testimony at trials and in depositions, that it was his expert opinion that AIDS was transmitted through factor concentrates by repeated exposure to foreign proteins and alloantigens in intermediate purity factor concentrates until 1984, when the AIDS virus was isolated and identified. (ECHO Magazine, May, 1983 “Special AIDS Edition”)

87.              CUTTER conducted an AIDS Forum in the Summer of 1983 at the World Hemophilia Federation Meeting in Stockholm, Sweden. CUTTER invited several hemophilia treatment experts to participate in the forum. CUTTER later published the statements made by some of the experts in a publication entitled “Cutter Forum: AIDS and Hemophilia Treatment.” In the publication the following statements were selected by CUTTER for attribution to the experts: “The physician who wants to test a patient for AIDS runs the risk of putting the patient into a state of terror.” “Many at the conference warned colleagues to avoid fueling patients’ fears by giving them inconclusive data.” “The major concern I have is that physicians or others who deliver healthcare will magnify the panic by telling patients they have `pre AIDS’ or AIDS, based on the methodology we have used for the last four or five years in defining T-Cell populations.” Another M.D. added, “With the anxiety our fellow physicians are causing patients, we’re going to see more fear of AIDS than actual cases of AIDS.” The statements attributed to these “experts” are misleading. In fact there was no medical or scientific support for any of the anonymous conclusions stated by the “M.D.’s” in the article. By the summer of 1983, T-cell testing was sufficiently reliable to form the basis of numerous reliable studies and conclusions about AIDS in hemophiliacs and other risk groups. There was no scientific methodology to support the statement that the fear of AIDS would outnumber actual AIDS cases. Instead, CUTTER’S motive was to understate the risk and increase sales, while continuing to conceal the use of high risk plasma to manufacture Factor VIII and IX.

88.              The CUTTER 1983 “Forum” article also attributed the following statement to an “expert” treater: “A physician who has dealt with AIDS directly also doubted the validity of T-Cell tests.” This statement was false because by the summer of 1983, T-cell abnormalities over time were a clear risk factor for AIDS. The article also stated, “Another M.D. added, ‘I have to sit down individually with all the patients and discuss the AIDS problem with them. But I stress that I am not very concerned because the majority of our hemophiliacs are not affected by it.’” This statement was very misleading because the growing epidemiological evidence regarding AIDS in hemophiliacs clearly supported a substantial risk due to their extensive use of factor concentrates, and Defendants knew of CDC projections that half of all hemophiliacs would develop AIDS.

89.              The CUTTER 1983 “Forum” article went on to state: “One researcher put the situation into perspective this way: ‘The very essence of our treatment programs could potentially be threatened by the fear of a disease that has not even killed ten hemophiliac people since 1982... I had eight patients die of trauma and cerebral hemorrhage last year, and I didn’t have any die of AIDS. I think we have to remember that our patients are getting hit on the head or mugged, that they’re falling down stairs, they’re bleeding to death, and that those problems are much more immediate than anything having to do with AIDS.’” This statement was misleading because in the summer of 1983, CUTTER conducted an analysis which acknowledged the risk of 2,000 to 5,000 hemophiliac deaths in the United States due to AIDS transmission through factor concentrates.

90.              The above statement is also misleading in that it perpetuated the false dichotomy between the benefits of factor concentrate therapy and the risk of AIDS. In fact, the benefits of such therapy could and should have been provided with little or no AIDS risk by avoiding use of high risk homosexual and IV drug user donors, treating plasma to kill viruses, and implementing the HBc test. This statement was also contrary to the medical, scientific and epidemiological evidence in existence at the time of the conference seminar on July 1, 1983. The risk of contracting AIDS was already close to one in 100 for severe type A hemophiliacs. If T-cell abnormalities were taken into consideration, the risk was close to one out of two for heavy users of the product. As noted previously, the CDC had predicted several months before the CUTTER Forum was published that 50% of hemophiliacs would suffer from full blown AIDS. (CUTTER document entitled “Cutter Forum, AIDS and Hemophilia Treatment” around July l, 1983)

91.              In late October 1983, CUTTER was notified that a donor had died of AIDS in Austin, Texas. The donor died within 30 days of his last donation. Because the donor’s plasma had been used in numerous lots of Factor VIII and IX over the previous two years, a recall of those lots was ordered by CUTTER. On November 1, 1983, CUTTER issued a press release regarding the recall. The press release stated, “No adverse reactions involving these lots have been reported.” This statement is misleading because it was virtually impossible for CUTTER to know whether or not any adverse reactions had been experienced or reported to physicians by patients who infused lots which contained plasma from the AIDS donor. The withdrawal pertained to several lots and involved the pooling of the AIDS donor’s plasma in thousands of doses of factor concentrate. In fact, abnormal T-cell ratios had undoubtedly been reported in some hemophiliacs who infused lots containing the AIDS donor’s plasma, along with lymphadenopathy and numerous other side effects associated with a pre-AIDS condition.

92.              CUTTER further stated in the November l, 1983, press release, “Although medical authorities consider the possibility of AIDS being transmitted through these products exceedingly remote, CUTTER is taking the action on its own initiative as a precautionary measure.” This statement is false because public health authorities from the CDC had advised CUTTER on March 15, 1983 that they expected one-half of the hemophilia patients who had infused these products to develop full blown AIDS. CUTTER had been repeatedly advised by public health officials that the AIDS observed in persons at risk for AIDS was only the “tip of the iceberg.” CUTTER had conducted its own in-house investigations entitled “AIDS scenarios” and concluded that a possible outcome would be full blown AIDS in 5,000 hemophiliacs in the U.S. There was a public health consensus that hemophiliacs were one of the high risk groups for contracting AIDS because of their use of Factor VIII. CUTTER was within days of applying to the FDA for a change to the labeling of Factor VIII that would include a stronger warning. (CUTTER Press Release dated November 1, 1983)

93.              ALPHA published and distributed a newsletter in the summer of 1983 entitled “Hemophilia.” The newsletter contains the statement in an introduction by Thomas Stagnaro, Marketing Head, that “[n]eedless to say, Alpha has stepped up efforts to protect hemophilia patients, but new evidence suggests there is no proof that AIDS is necessarily associated with blood or blood products.” This statement was misleading because it was contrary to existing and accumulating scientific evidence demonstrating the associated risk between use of Factor VIII and AIDS. It was also contrary to the PHS guidelines and recommendations of January 4 and March 24, 1983 mandating screening of high risk donors for AIDS.

94.              The ALPHA 1983 newsletter also stated: “There is some question as to whether use of cryoprecipitate would actually be safer in any case.” This statement was contrary to the consensus that cryoprecipitate was safer because it was made from voluntary donors in groups of 8 to 10, while ALPHA’s product was made using pools of plasma from high risk paid donors, with 5,000 to 40,000 donations in each lot. Immune abnormalities had been associated with use of factor concentrates but not cryoprecipitate. Thus, there was no credible evidence upon which to question the fact that cryoprecipitate was safer than factor concentrates. (Hemophilia Letter, dated Summer, 1983, Vol. 5, No. 1.)

95.              ALPHA organized a seminar consisting of hemophilia treaters and physicians from the CDC and NIH in connection with an American Blood Resources Association (“ABRA”) meeting held in Puerto Rico in March, 1983, called the “ABRA Plasma Form.” All Defendants were members of ABRA, and ABRA itself held meetings of Defendants for the purpose of planning strategies to understate the AIDS risk. ALPHA published excerpts from the 1983 Forum which understated the risk of factor concentrate in comparison to other therapies, such as the statement attributed to Dr. Lou Aledort of the NHF: “[M]ore recent, unpublished data show that immune system abnormalities develop in hemophiliacs no matter what sort of treatment they receive, concentrate or cryo, Factor VIII or IX, high doses or low, and whether they are young or old, or whether their disease is mild, moderate or severe.” Dr. Aledort also cautioned that “measuring T-Cell changes is technically difficult, and that the methodology used in some studies has been faulty.” This statement was contrary to the medical and scientific evidence existing at that time. Older, more severe hemophiliacs who had used more product were demonstrating more severe immune abnormalities, as well as opportunistic infections. Factor VIII users, who were exposed to greater quantities of concentrate, were more immune suppressed than Factor IX users. Cryoprecipitate users had fewer immune abnormalities than concentrate users.

96.              The 1983 ALPHA/ABRA Forum includes the following statement, attributed to Dr. Nemo: “It is not at all clear, Dr. Nemo said, that an infectious AIDS agent, if one exists, can be spread by blood products. The link between AIDS and its possible transmission by blood products is very tenuous indeed.” This statement was demonstrably false by March, 1983, by which time the overwhelming scientific evidence supported the conclusion that AIDS was transmitted by blood products such as factor concentrates. (Highlights from the 1983 ABRA Plasma Forum, A Professional Service of Alpha Therapeutic Corporation, March 1983.)

97.              On or about December 15, 1983, Rodell, then the head of ARMOUR, told members of the federal Blood Product Advisory Committee (BPAC) and FDA officials that the Defendants wanted a three month deferral in implementation of any recommendations by the BPAC or FDA that HBc testing be required for plasma donors. Rodell told the FDA that the purpose of the deferral was to prepare a response to the proposed recommendation. In fact, all Defendants had agreed to seek the three month hiatus as a “delaying tactic” against implementing the test, and the request for a deferral was made in bad faith. (CUTTER memorandum dated December 13, 1983.)

98.              The September 1985 issue of ECHO magazine also contained a number of false and misleading statements. In the magazine, CUTTER stated, “The ability to screen donors was hampered by not knowing what caused the disease. However, as soon as it became known that there was a possibility of transmitting AIDS through blood products, Cutter Laboratories began to screen donors in an effort to exclude any who were in the high risk groups.” This statement was misleading because there was no need to determine what actually caused Factor VIII to transmit AIDS in order for CUTTER to screen out donors who were at high risk for AIDS transmission. It was strongly suggested by the CDC on July 27, 1982, that AIDS had a viral etiology similar to Hepatitis B because of the risk groups involved. These risk groups comprised a substantial portion of CUTTER’S plasma donor sources. CUTTER took no meaningful action to screen out donors at the highest risk for AIDS and Hepatitis C transmission at any time during the epidemic. In fact, they continued to market products containing plasma from these groups throughout 1982, 1983 and 1984 worldwide.  Even more egregiously, CUTTER and other Defendants continued to market high risk non-heat treated factor concentrate abroad after ceasing sales of such product in the United States in favor of vastly safer heat treated product.

99.              In the same issue of ECHO, Dr. Margaret Hilgartner, a hemophilia treater from Cornell Medical Center presented by CUTTER, made the following statement understating the risk of AIDS and exaggerating the need for factor concentrate products: “The current risk of persons with hemophilia developing AIDS is directly related to their need for blood products to stop bleeding. The risk is extremely low. Although most persons with hemophilia who have been treated with concentrate and some who have been treated with cryoprecipitate have been exposed to the virus in the past, less than .1 percent of the 20,000 persons with hemophilia in the United States have developed AIDS.” This statement was misleading for several reasons:

a.                   The risk was very close to 1% for severe type A hemophiliacs, who were the heaviest users and most likely to be exposed to HIV in Factor VIII. The CDC had reported 71 cases in such persons by September 1985. Since there were approximately 8,000 severe, Type A Hemophiliacs using the product regularly, the risk was close to one in 100. A 1 % risk of contracting AIDS, a fatal disease, is not “low” as stated by Dr. Hilgartner. Dr. George Akin, CUTTER’S medical director, repeated this misrepresentation in his forward to the Hilgartner article in the ECHO publication.

b.                  The article did not disclose the report made by Dr. Evatt of the CDC to the company at a March 1983 ABRA meeting, in which he projected that one half of all hemophiliacs would get full blown AIDS based upon their known T-Cell abnormalities tied to exposure to Factor VIII. (CUTTER memorandum dated March 14, 1983.)

c.                   As they had done throughout, Defendants misleadingly represented that the benefits of Factor VIII outweighed the risks of AIDS and Hepatitis C, when in fact the benefits could and should have been provided with minimal risk through proper safety measures and avoiding high risk donors.

100.          In the same issue of ECHO, Dr. Hilgartner further stated, “[A] positive test result does not mean that the person will actually get AIDS.” This statement was misleading because there was no scientific basis for concluding in September 1985 that a positive ELISA test, the then-existing test for the presence of HIV antibodies, did not mean eventual full blown AIDS in the patient. In fact, severe T-Cell abnormalities and a positive ELISA test were reliable predictors of full blown, and eventually fatal, AIDS.

101.          Dr. Hilgartner’s article states, “There is no evidence to warrant changing the current use of Factor VIII or Factor IX.” This statement was also false. In fact, the evidence was just the opposite. Non-heat treated, intermediate purity products were known by September 1985 to be contaminated with HIV by virtue of testing done at the CDC in the summer of 1984. These tests demonstrated that 70% of type A severe and 40% of type B hemophiliacs were HIV positive. In addition, Dr. Hilgartner had reported to the New York Academy of Sciences in 1983 that Factor VIII was associated with extremely serious side effects, including loss of lymphocytes, thrombocytopenia, liver damage, renal failure, splenomegaly and abnormally high levels of circulating immune complexes. Many of these same diseases were reported in hemophiliac AIDS victims. Thus, there was strong medical and scientific evidence that continued use of non-heat treated, intermediate purity factor concentrates should be avoided. (ECHO magazine Vol. 6, No. 3, dated September 1985.)

102.          These facts demonstrate that Defendants, jointly and individually, fraudulently misrepresented the risk of AIDS and Hepatitis C due to factor concentrates, failed to disclose accurate warnings of the risk to Plaintiffs or their physicians, and fraudulently purported to be doing “everything possible” to improve safety, when in fact Defendants maximized the risk by recruiting high risk donors and by resisting and obstructing HBc testing, heat treatment, and other measures that would truly have reduced the risk.

H.                Defendants’ Activities Were Subject to Applicable Federal Regulations, Which Evidence the Standard of Care With Which Defendants Should Have Complied

103.          Blood derivatives such as Factor VIII and IX are prescription biologicals subject to federal regulation as both “biological products” and “drugs.” Public Health Service Act, “Regulation of Biological Products,” 42 U.S.C. § 262; Food, Drug & Cosmetic Act (“FDCA”), 21 U.S.C. § 301, et seq.

(a)                21 U.S.C. § 331(b) prohibited [should these be present tense instead?] “adulteration or misbranding of any … drug, . . . .”

(b)               21 U.S.C. § 351(a)(2)(B) provided that “[a] drug . . . shall be deemed to be adulterated . . . if . . . the methods used in, or the facilities or controls used for, its manufacture, processing, packing, or holding do not conform to or are not operated or administered in conformity with current good manufacturing practice to assure that such drug meets the requirements of this chapter as to safety. . . .”

(c)                21 U.S.C. § 352 provided that “[a] drug... shall be deemed to be misbranded. .. if its labeling is false or misleading in any particular.”

(d)               21 U.S.C. § 352(f)(2) provided that a drug shall be deemed to be “misbranded” unless its labeling bears “adequate warnings against use. .. where its use may be dangerous to health.”

(e)                21 U.S.C. § 352(n) provided that a drug shall be deemed to be “misbranded” unless the labeling included information concerning side effects and contraindications as required in federal regulations.

(f)                 21 U.S.C. § 321(n) provided that if an article is alleged to be misbranded because the labeling or advertising is misleading, then the determination of whether the labeling or advertising is misleading shall take into account “not only representations made or suggested” by affirmative statements, “but also the extent to which the labeling or advertising fails to reveal facts material in the light of such representations or material with respect to consequences which may result from the use” of the drug.

104.          At all times material to this Complaint, 21 C.F.R. § 201.57(e) provided as follows, with respect to information to be provided with the sale of Defendants’ products:

Warnings: Under this section heading, the labeling shall describe serious adverse reactions and potential safety hazards, limitations in use imposed by them, and steps that should be taken if they occur. The labeling shall be revised to include a warning as soon as there is reasonable evidence of an association with a drug; a causal relationship need not have been proved.

105.          At all times material to this Complaint, 21 C.F.R. § 200.5 provided as

follows:

Manufacturers and distributors of drugs and the Food and Drug Administration occasionally are required to mail important information about drugs to physicians and others responsible for patient care. In the public interest, such mail shall be distinctive in appearance so that it will be promptly recognized and read.

106.          At all times material to this Complaint, Part 606 of 21 C.F.R. set forth “Current Good Manufacturing Practices” for biological products generally, and 21 C.F.R. § 640, et seq., set forth additional good manufacturing practices for blood and plasma biologicals.

107.          At all times material to this Complaint, 21 C.F.R. § 606.140(a) provided:

Laboratory control procedures shall include: The establishment of scientifically sound and appropriate specifications, standards and test procedures to assure that blood and blood components are safe, pure, potent and effective.

108.          At all times material to this Complaint, 21 C.F.R. § 640.60 defined “Source Plasma (1-luman)” as

the fluid portion of human blood which has been stabilized against clotting, collected by plasmapheresis, and is intended as source material for further manufacture into blood derivatives (a portion of pooled plasma separable by chemical means) intended for injection.

109.          At all times material to this Complaint, 21 C.F.R. § 640.63(c), entitled “Qualification of Donor,” provided as follows with respect to donors of source plasma:

Donors shall be in good health on the day of donation, as indicated in part by: . . . (9) freedom from any disease, other than malaria, transmissible by blood transfusion, in so far as can he determined by history and examination indicated in this section; (10) freedom of the arms and forearms from skin punctures or scars indicative of addiction to self-injected narcotics; (11) freedom from a history of viral hepatitis; (12) freedom from a history of close contact within six months of donation with an individual having viral hepatitis; ... .

Further, 21 C.F.R. § 640.63(a) provided that the method of determining “suitability of a donor” included “tests” as well as the taking of a history and physical examination.

110.          At all times material to this Complaint, 21 C.F.R. § 606.140 provided as follows:

Laboratory control procedures shall include: (a) The establishment of scientifically sound and appropriate specifications, standards and test procedures to ensure that blood and blood components are safe, pure, potent and effective.

111.          The foregoing statutes and regulations are evidence of the standard of care Defendants should have employed in the manufacture and sale of Factor VIII and Factor IX. Defendants violated the foregoing regulations and/or failed to comply with applicable standards of care by: (a) marketing “adulterated” products that were unsafe as a result of failure to comply with “Current Good Manufacturing Practice”; (b) marketing “misbranded” products that were misleading and failed to disclose or warn of health dangers; (c) failing to warn of serious adverse reactions and potential safety hazards as soon as there was reasonable evidence of an association with the product; (d) failing to exclude intravenous drug users who were unsuitable donors; (e) failing to exclude donors with a history of viral Hepatitis who were unsuitable donors; (f) affirmatively seeking out unsuitable donors known to have viral Hepatitis antibodies, as well as prison populations known to include substantial numbers of intravenous drug users, for inclusion of their plasma in the pools used to make Factor VIII and Factor IX; (g) failing to disclose their use of dangerous donors; and (h) failing to use appropriate tests and/or procedures to assure the products were safe.

I.                   Conspiracy, Concert of Action and Group Liability

112.          Defendants, and each of them, acted in concert and participated in a conscious and deliberate conspiracy to act negligently, fraudulently and with willful and wanton disregard for the rights and safety of blood product users, in connection with the manufacture of Factor VIII and IX blood products and the collection of constituent plasma.

113.          After 1978, there were only four corporations in the United States engaged in the production of Factor VIII and IX. These four companies, Defendants herein, tacitly and explicitly agreed to avoid upgrading industry standards. For example, the technology to virally inactivate factor concentrates existed in the early 1970s, but was not seriously investigated by any of the Defendants until the early 1980s, despite its effective use in Europe. Use of the HBc antibody test to eliminate Hepatitis B carrier donors, and to identify donors with a history of viral Hepatitis, was known science by 1978. The HBc test was reported to be an effective surrogate test for both AIDS transmission and NANB Hepatitis carriers by 1982, yet no Defendant implemented this test until April 1984.

114.          Three of the Defendants, ALPHA, BAXTER and CUTTER, used donors from predominantly homosexual donor centers, prisons, and inner city areas where the risk of IV drug abuse was high. After July 1982, when the results of this conduct culminated in reports of fatal immune suppression in three hemophiliacs who infused the product, this concert of action took on a more overt, active form.

115.          By December 1982, the FDA demanded that Defendants stop using prisoners, donors from high risk areas for hepatitis and AIDS transmission, and known homosexuals. Rather than use good faith efforts to comply with the FDA requests, Defendants collectively argued for a far less onerous and less effective donor screening program. They jointly proposed a system comprised of educating the donor by posting a placard in the donor center stating who the risk groups for AIDS transmission were, and advising the donor that he would be deferred if he acknowledged he was a member of one of those groups. Later, he would be required to fill out a questionnaire in private. If he checked the box indicating he was in a high risk group, he would be permanently deferred.

116.          At a January 6, 1983 meeting of Defendants’ trade association, the Biological Section of the Pharmaceutical Manufacturer’s Association (“PMA”), Defendants agreed not to implement highly effective HBc donor screening, instead selecting ineffective donor questionnaires that did little to screen out donors at high risk for AIDS transmission.  Defendants further agreed to keep each other informed as to what the other was doing in order that a low standard of care was maintained.  HBc testing had been strongly suggested by the CDC at the January 4, 1983 Public Health Service (“PHS”) meeting.  On January 14, 1983, Defendants acted jointly to persuade the National Hemophilia Foundation (“NHF”) not to advocate surrogate testing for AIDS and Hepatitis C through implementation of the HBc test. Defendants persuaded the NHF that use of the HBc test was in the “R and D” stage and not practical to implement at that time.

117.          Defendants jointly agreed to oppose recall of the products beginning at the January 6, 1983 meeting at the Pharmaceutical Manufacturers’ Association (“PMA”).  Beginning with this meeting and continuing through at least July 19, 1983, Defendants met at various times to prepare a strategy to prevent the FDA from advocating a far-reaching recall of factor concentrate products.  Defendants knew that due to their high risk donor populations, and their combining of these donors in pools of 5,000 to 40,000, that their products were contaminated with the AIDS agent.  Nevertheless, Defendants acted in concert to lobby the FDA, to get the FDA to issue recommendations to limit recalls to circumstances in which an identified donor had died of AIDS within a specified time after the pooling of that donor’s plasma.  Defendants were well aware that plasma from contaminated asymptomatic donors were mixed in the plasma pools and contaminated virtually all lots.  Defendants were successful in deferring any FDA Blood Products Advisory Committee (“BPAC”) recommendation for a general recall of the product at the July 19, 1983 BPAC meeting.  This joint action allowed the defendants to avoid ever recalling any product except when a donor died of AIDS. 

118.          Defendants conducted a meeting on or about January 6, 1983 at the PMA, a major purpose of which was to decide on a unified strategy to deal with increasing knowledge of risk of AIDS.  At the meeting all four companies agreed to postpone submitting any request to the FDA for permission to amend their warning labels or package inserts.  They further agreed not to apply to the FDA for warnings enhancements until the other three companies agreed to make application for warning enhancements and to make the warnings similar in content.  At the time of the meeting, Defendants had been informed by various reliable health authorities, including the PHS, that there was evidence of an association of risk between factor concentrate use and the transmission of AIDS. 

119.          On December 13, 1983, Stephen Ojala, CUTTER’s responsible head, documented by written memorandum that Defendants met and jointly agreed to propose a “study” of the HBc surrogate screening test, as a “delaying tactic” to avoid implementing the HBc test. 

120.          Thereafter, at various times throughout 1983-1985, Defendants attended meetings or otherwise communicated to assure joint efforts to avoid recalling product; to avoid warning patients of the true risk; to market product when sales dropped due to information in the lay press related to AIDS transmission through factor concentrates; to avoid recall of non-heat-treated product after heat-treated products were available; to avoid implementation of the HBc test; and to coordinated a joint legal defense plan in anticipation of litigation from patients afflicted by AIDS through use of the products. Defendants also operated through trade organizations, such as ABRA and PMA, to issue public statements minimizing the risks of AIDS and Hepatitis C and overpromoting the benefits of factor concentrate, to carry out the above­mentioned goals of all Defendants.

121.          All of the Defendants likely to have caused the harm to Plaintiffs are parties to this lawsuit and properly before the court.

122.          The conduct of each and all of the Defendants, with respect to their Factor VIII and Factor IX products and related plasma collection methods, was tortious.

123.          The harm which has been caused to the Plaintiffs resulted from the conduct of one, or various combinations of the Defendants, and, through no fault of the Plaintiffs, there may be uncertainty as to which one or combination of Defendants caused the harm.

124.          The burden of proof should be upon each Defendant to prove that the Defendant has not caused the harms suffered by the Plaintiffs.

125.          AHF was manufactured using the same fractionation method by all Defendants. As such, during the relevant years from 1975 until 1985, factor concentrates were a fungible product, and physicians prescribed the products interchangeably without regards to brand names of the drugs.

126.          The factor concentrates manufactured by Defendants from 1975 until 1985 contained the same design flaws. They were all manufactured from paid donor plasma, which was at highest risk for Hepatitis B, Hepatitis C, and HIV viral transmission. In addition, the factor concentrate was made from large pools consisting of 5,000 to 40,000 paid donors, which further magnified the risk of viral transmission.

127.          None of the factor concentrate was virally inactivated during this time period. Therefore, all of the AHF carried a significant risk of viral transmission. In addition, all of Defendants’ factor concentrate products were similarly misbranded.  All of the products failed to warn of the known risks enumerated in this complaint.

128.          In large part because of the fungibility of Defendants’ factor concentrate products, many hemophiliacs infused products from two or more of the Defendants during the time period when all of the Defendants’ products were infectious for HCV and HIV.  It therefore may not be possible in to determine which of the Defendants’ products actually caused each Plaintiff’s infection.  By suing the named Defendants, Plaintiffs have joined all those manufacturers who could have caused the infection with HCV and HIV.  Plaintiffs allege that Defendants have joint, several, and alternative liability for Plaintiffs’ injuries.

129.          Plaintiffs in this case will make all reasonable efforts through discovery and use of experts to make a good faith determination as to which of the Defendants’ product(s) caused their respective HCV and/or HIV infections. However, if it is not possible to make such a determination, Plaintiffs respectfully request that in the event that they prove that one or more Defendants breached a duty to Plaintiffs that caused their infection with HIV and/or HCV, but it cannot be proven which Defendants’ product(s) caused this harm, the court award damages consistent with each Defendant's market share at the relevant time.

V.                 CLASS ACTION ALLEGATIONS

130.          Plaintiffs bring this class action pursuant to Rule 23 of the Federal Rules of Civil Procedure, and seek class certification under the applicable provisions of Rules 23(a) through (c), on behalf of a class (the “Class”) consisting of:

all persons residing outside the United States who used any non-heat treated blood factor concentrate manufactured, sold, or distributed by Defendants in the period from 1978 to 1990 and who contracted HIV and/or HCV; their infected spouses and children; and the estates of persons in the previous two categories who died on or after May 31, 2002 and/or have surviving children 18 years of age or younger.

131.          Excluded from the Class are defendants, including any parent, subsidiary, affiliate or controlled person of defendants and their officers, directors, agents, employees and members of their immediate families.

132.          The Class is so numerous that individual joinder of all members is impracticable.  As of 1992, there were over 30,000 hemophiliacs in Europe alone.  The Class is readily identifiable on the basis of medical records indicating positive test results for HIV and/or HCV and prior usage of Defendants’ blood factor concentrate during the class period.  Fed. R. Civ. P. 23(a)(1).

133.          In this action, key and significant common issues of law and fact relating to the defectiveness of Defendants’ blood factor concentrate, and to Defendants’ knowledge, conduct and duty in its formulation, manufacturing, research, testing, promotion, marketing, and sales exist, and these common issues predominate over any issues affecting only individual Class members.  Fed. R. Civ. P. 23(a)(2); (b)(3).

134.          The claims of the representative Plaintiffs are typical of the claims of the Class in that Plaintiffs and the members of the Class were infected as a result of their or their spouse’s or parent’s infusion with Defendants’ contaminated factor concentrate during the class period.  The harm to Plaintiffs and members of the Class was caused directly by Defendants’ wrongful conduct in that factor concentrate infused by Plaintiffs or their spouses or parents suffers from the same defect(s) as the factor concentrate manufactured, sold and/or distributed by Defendants to all Class members during the class period, and Defendants’ misrepresentations regarding the factor concentrate were made to all Class members.  Fed. R. Civ. P. 23(a)(3).

135.          Like other Class members, the named Plaintiffs suffered injuries and damages as a result of their infusion or their spouse’s or parent’s infusion of Defendants’ factor concentrate.  Fed. R. Civ. P. 23(a)(3); (a)(4).

136.          Plaintiffs will fairly and adequately represent and protect the interests of the members of the Class.  Plaintiffs have no interests which are adverse to the interests of the Class.  Fed. R. Civ. P. 23(a)(4).

137.          Plaintiffs have retained counsel competent and experienced in complex class actions, pharmaceutical products liability litigation, and international litigation.  Fed. R. Civ. P. 23(a)(4).

138.          Class certification may also be appropriate under Fed. R. Civ. P. 23(b)(1) or (b)(2) for purposes of equitable/injunctive relief.

139.          This Court may exercise its discretion to designate particular claims or issues for class treatment and joint or common trial pursuant to Fed. R. Civ. P. 23(c)(4)(a) and may designate one or more subclasses pursuant to Fed. R. Civ. P. 23(c)(4)(b).

140.          A class action is superior to other available methods for the fair and efficient adjudication of this dispute because common questions of law and fact predominate over any questions that may affect only individual members of the Class, and there would be enormous economies to the courts and the parties litigating the common issues on a class wide basis instead of through repetitive individual trials.  A class action approach would involve fewer management difficulties because it provides the benefits of unitary adjudication, judicial economy, economics of scale and comprehensive supervision by a single court.  Fed. R. Civ. P. 23(b)(3)(A)-(D).

VI.              TOLLING OF APPLICABLE STATUTES OF LIMITATION

141.          Any and all potentially applicable statutes of limitations have been tolled by Defendants’ affirmative and intentional acts of fraudulent conduct, concealment, and misrepresentation, alleged above, which estop Defendants from asserting statutes of limitation.  Such acts include but are not limited to intentionally covering up and refusing to disclose use of high risk plasma; sale of products abroad known to be contaminated; suppressing and subverting medical and scientific research; and failing to disclose and suppressing information concerning the risks of HIV and HCV transmission from Defendants’ contaminated factor concentrate.  For example, while the spread of AIDS in homosexuals and IV drug users became known to the FDA and the public, only Defendants knew that these very populations were the donors Defendants were targeting to obtain plasma for their factor concentrate products.

142.          Defendants are estopped from relying on any statutes of limitation because of their fraudulent concealment and misrepresentation alleged above.  Defendants were under a duty to disclose the risks of HIV and HCV transmission from their contaminated factor concentrate because this is nonpublic information over which they had exclusive control, because Defendants knew this information was not readily available to Plaintiffs, and because this information was relevant to Plaintiffs in deciding whether to use Defendants’ factor concentrate.

143.          Until very recently, Plaintiffs had no knowledge that Defendants were engaged in much of the wrongdoing alleged herein.  Because of the fraudulent and active concealment of the wrongdoing by Defendants, including but not limited to deliberate efforts—which continue to this day—to give Plaintiffs the materially false impression that Defendants undertook all feasible safety precautions to reduce the risk of HIV and HCV transmission from their contaminated factor concentrate, Plaintiffs could not reasonably have discovered the wrongdoing any time prior to this time, nor could Plaintiffs have, as a practical matter, taken legally effective action given the unavailability, until very recently, of internal memoranda and other documents (as generally described herein) as evidence in support of Plaintiffs’ claims.  Defendants still refuse to admit and continue to conceal their wrongdoing, and therefore Defendants’ acts of fraudulent concealment and misrepresentation continue through the present time.

VII.           CLAIMS FOR RELIEF

First CLAIM FOR RELIEF

NEGLIGENCE

144.          Plaintiffs incorporate by reference all previous paragraphs of this Complaint as if fully set forth here and further allege as follows:

145.          Defendants marketed their Factor VIII and/or Factor IX blood products to and for the benefit of Plaintiffs and the Class, and knew or should have known that Plaintiffs and the Class would use their Factor VIII and/or Factor IX blood products.

146.          Defendants owed Plaintiffs duties to exercise reasonable care in light of the generally recognized and prevailing best scientific knowledge.

147.          Through the conduct described in the foregoing and subsequent paragraphs of this Complaint, the Defendants breached their duties to Plaintiffs. The following sub-paragraphs summarize Defendants’ breaches of duties to Plaintiffs and describe categories of acts or omissions constituting breaches of duty by Defendants; each and/or any of these acts or omissions establishes an independent basis for Defendants’ liability in negligence:

a.                   Failure to exercise reasonable care in producing Factor VIII and Factor IX blood products that were free of viruses, including the HIV virus that causes AIDS and the HCV virus that causes Hepatitis C;

b.                  Failure to exercise reasonable care in assuring that only suitable plasma would be used in manufacturing Factor VIII and Factor IX blood products;

c.                   Failure to exercise reasonable care in testing plasma used in manufacturing Factor VIII and Factor IX blood products for virus contamination;

d.                  Failure to exercise reasonable care in recruiting and screening donors of plasma used in manufacturing Factor VIII and Factor IX blood products;

e.                   Failure to employ anti-viral techniques, including heat treating, in the manufacture of Factor VIII and Factor IX blood products;

f.                    Overpromotion of Factor VIII and Factor IX blood products;

g.                   Understating the relative value of hemophilia treatments that constituted alternatives to Defendants’ Factor VIII and Factor IX blood products;

h.                   Failure to warn physicians, Plaintiffs, and the hemophiliac community of the dangers associated with Factor VIII and Factor IX blood products and/or the viruses and foreign bodies contained within the plasma used in manufacturing Factor VIII and Factor IX blood products;

i.                     Failure to exercise reasonable care by complying with federal regulations then applicable to plasma collection and the manufacture of Factor VIII and Factor IX blood products.

j.                    Failure to exercise reasonable care in disseminating information about Defendants’ methods of manufacturing Factor VIII and Factor IX blood products and the risks that were created by said methods; and

k.                  Failure to exercise reasonable care in recalling Factor VIII and Factor IX blood products.

148.          Defendants knew, or should have known, that, due to their failure to use reasonable care, Plaintiffs and other hemophiliacs, would use and did use Defendants’ Factor VIII and/or Factor IX products to the detriment of their health, safety and well-being.

149.          As the direct, producing and legal cause and result of the Defendants’ negligence, Plaintiffs have been injured and have incurred damages, including but not limited to permanent physical injuries to their persons, medical and hospital expenses in the past, past disability, past loss of use of the body, past physical and mental pain and suffering, and will incur in the future medical and hospital expenses, permanent disability, future loss of use of the body, and future physical and mental pain and suffering and loss of the enjoyment of life.

150.          Plaintiffs are therefore entitled to damages in an amount to be proven at trial, together with interest thereon and costs.

151.          Defendants’ conduct, as alleged above, was malicious, intentional and outrageous and constituted willful and wanton disregard for the rights or safety of others.  Such conduct was directed specifically at Plaintiffs and the Class and was such as warrants an award of punitive damages.

Second CLAIM FOR RELIEF

NEGLIGENCE PER SE

152.          Plaintiffs incorporate by reference all previous paragraphs of this Complaint as if fully set forth here and further allege as follows:

153.          Defendants violated applicable federal statutes and regulations relating to prescription drugs.  Plaintiffs are persons whom these statutes and regulations were meant to protect.

154.          Defendants’ violation of these statutes or regulations constitutes negligence per se.

155.          Defendants’ violation of these statutes or regulations was the direct, producing and legal cause of Plaintiffs’ injuries and damages. As the direct, producing and legal cause and result of the Defendants’ negligence, Plaintiffs have been injured and have incurred damages, including but not limited to permanent physical injuries to their persons, medical and hospital expenses in the past, past disability, past loss of use of the body, past physical and mental pain and suffering, and will incur in the future medical and hospital expenses, permanent disability, fixture loss of use of the body, and fixture physical and mental pain and suffering and loss of the enjoyment of life.

156.          Plaintiffs are therefore entitled to damages in an amount to be proven at trial, together with interest thereon and costs.

157.          Defendants’ conduct, as alleged above, was malicious, intentional and outrageous and constituted willful and wanton disregard for the rights or safety of others.  Such conduct was directed specifically at Plaintiffs and the Class and was such as warrants an award of punitive damages.

Third CLAIM FOR RELIEF

FRAUDULENT OMISSION AND CONCEALMENT

158.          Plaintiffs incorporate by reference all previous paragraphs of this Complaint as if fully set forth here and further allege as follows:

159.          Defendants had a confidential and special relationship with Plaintiffs due to (a) Defendants’ vastly superior knowledge of the health and safety risks relating to Factor VIII and Factor IX, (b) Defendants’ sole and/or superior knowledge of their dangerous and irresponsible plasma collection practices; and (c) Defendants’ direct communications with the hemophiliac community through newsletters that purported to accurately convey the risk of AIDS. As a result, Defendants had an affirmative duty to fully and adequately warn the hemophiliac community, including Plaintiffs and their physicians, of the true health and safety risks related to the Factor VIII and Factor IX blood products and constituent plasma and a duty to disclose their dangerous and irresponsible plasma collection practices. Independent of any special relationship of confidence or trust, Defendants had a duty not to conceal the dangers of the products to Plaintiffs and their physicians.

160.          Misrepresentations made by the Defendants about the health and safety of their factor concentrate products independently imposed a duty upon Defendants to fully and accurately disclose to the hemophiliac community, including Plaintiffs and their physicians, the true health and safety risks related to Factor VIII and Factor IX and its constituent plasma and a duty to disclose their dangerous and irresponsible plasma collection practices.

161.          In connection with their Factor VIII and Factor IX products, Defendants fraudulently and intentionally concealed important and material health and safety product risk information from Plaintiffs, the hemophiliac community, and their physicians, all as alleged in this Complaint.

162.          Any of the following is sufficient to independently establish Defendants’ liability for fraudulent omission and/or concealment:

a.                   Defendants fraudulently concealed the health and safety hazards, symptoms, constellation of symptoms, diseases and/or health problems associated with their Factor VIII and Factor IX blood products and related plasma collection activities;

b.                  Defendants fraudulently concealed their practice of using unsuitable plasma from unsuitable donors in the manufacture of Factor VIII and Factor IX blood products;

c.                   Defendants fraudulently concealed their practice of avoiding the use of available technology to detect viruses in Defendants’ blood products and the components thereof;

d.                  Defendants fraudulently concealed their practice of avoiding the use of available technology to destroy viruses in Defendants’ blood products and the components thereof;

e.                   Defendants fraudulently concealed information about the known comparative risks and benefits of the use of Factor VIII and Factor IX and the relative benefits and availability of alternate products and therapies.

163.          Defendants knew that Plaintiffs, the hemophiliac community, and their physicians would regard the matters Defendants concealed to be important in determining their course of treatment, including their decision whether to use Factor VIII and/or Factor IX.

164.          As a direct and proximate result of Defendants’ fraudulent concealment and suppression of material health and safety risks relating to Factor VIII and Factor IX and of Defendants’ dangerous and irresponsible plasma collection practices, Plaintiffs have suffered and will continue to suffer injury, harm and economic loss. As the direct, producing and legal cause and result of the Defendants’ fraudulent concealment and suppression of material health and safety risks relating to Factor VIII and Factor IX and of Defendants’ dangerous and irresponsible plasma collection practices, Plaintiffs have been injured and has incurred damages, including but not limited to permanent physical injuries to their persons, medical and hospital expenses in the past, past disability, past loss of use of the body, past physical and mental pain and suffering, and will incur in the future medical and hospital expenses, permanent disability, future loss of use of the body, and future physical and mental pain and suffering and loss of the enjoyment of life.

165.          Plaintiffs are therefore entitled to damages in an amount to be proven at trial, together with interest thereon and costs.

166.          Defendants’ conduct, as alleged above, was malicious, intentional and outrageous and constituted willful and wanton disregard for the rights or safety of others.  Such conduct was directed specifically at the Plaintiffs and was such as warrants an award of punitive damages.

167.          Plaintiffs are informed and believe that Defendants utilize retention policies that provide for scheduled destruction of documents and other items, which may result in the knowing, negligent, or inadvertent destruction of documents, data, and materials relevant and necessary to adjudication of this action, including, but not limited to, records identifying batch or lot numbers of Defendants’ products shipped to particular treatment facilities abroad, which may facilitate product tracing.  This risk warrants an order from this Court that such evidence (including all documents, data compilations, and tangible things within the meaning of Rule 26 of the Federal Rules of Civil Procedure) be preserved and maintained for use in these proceedings.

Fourth CLAIM FOR RELIEF

BREACH OF IMPLIED WARRANTY

168.          Plaintiffs incorporate by reference all previous paragraphs of this Complaint as if fully set forth here and further allege as follows:

169.          Defendants’ factor concentrate products were intentionally designed, manufactured, promoted, distributed and sold to be introduced into the human body.

170.          Defendants breached the implied warranties of merchantability and fitness because Defendants’ factor concentrate products cannot pass without objection in the trade, are unsafe, are not merchantable, are unfit for their ordinary use when sold, and are not adequately packaged and labeled.

VIII.        PRAYER FOR RELIEF

WHEREFORE, Plaintiffs, on their own behalf and on behalf of the Class,  pray for judgment against Defendants, and each of them, as follows:

1.                  For an order certifying the Class under the applicable provisions of Federal Rules of Civil Procedure 23, and appointing Plaintiffs and their counsel to represent the Class;

2.                  For compensatory damages sustained by Plaintiffs and members of the Class, against all Defendants, jointly and severally, in an amount to be determined at trial;

3.                  For punitive and exemplary damages according to proof against all Defendants;

4.                  For an award of prejudgment interest, costs, disbursements and reasonable attorneys’ fees;

5.                  For injunctive relief in the form of an order requiring Defendants to preserve all relevant documents; and

6.                  For such other and further relief as the Court deems equitable or appropriate under the circumstances.

 

 

 

 

Dated:                                                       

 

 

 

                                                                                

Elizabeth J. Cabraser

 

Lieff, Cabraser, Heimann
  & Bernstein, LLP

Elizabeth J. Cabraser (State Bar No. 83151)

Robert J. Nelson (State Bar No. 132797)

Morris A. Ratner (State Bar No. 157554)

Fabrice N. Vincent (State Bar No. 160780)

Heather A. Foster (State Bar No. 184353)

Lexi J. Hazam (State Bar No. 224457)
275 Battery Street, 30th Floor
San Francisco, CA  94111-3339

Telephone:  (415) 956-1000

Facsimile:  (415) 956-1008

 

 

 

LAW OFFICES OF CHARLES

   KOZAK

Charles Kozak (State Bar No. 141758)
275 Battery Street, 30th Floor
San Francisco, CA  94111-3339

Telephone:  (415) 956-1000

Facsimile:  (415) 956-1008

 

Attorneys for Individual and Representative Plaintiffs


DEMAND FOR JURY TRIAL

Plaintiffs demand a trial by jury on all issues stated.

 

 

 

 

 

Dated:                                                       

 

 

 

 

                                                                                

Elizabeth J. Cabraser

 

Lieff, Cabraser, Heimann
  & Bernstein, LLP

Elizabeth J. Cabraser (State Bar No. 83151)

Robert J. Nelson (State Bar No. 132797)

Morris A. Ratner (State Bar No. 157554)

Fabrice N. Vincent (State Bar No. 160780)

Heather A. Foster (State Bar No. 184353)

Lexi J. Hazam (State Bar No. 224457)
275 Battery Street, 30th Floor
San Francisco, CA  94111-3339

Telephone:  (415) 956-1000

Facsimile:  (415) 956-1008

 

 

 

LAW OFFICES OF CHARLES

   KOZAK

Charles Kozak (State Bar No. 141758)
275 Battery Street, 30th Floor
San Francisco, CA  94111-3339

Telephone:  (415) 956-1000

Facsimile:  (415) 956-1008

 

Attorneys for Individual and Representative Plaintiffs

 

 


I.          INTRODUCTION.. 1

II.         JURISDICTION AND VENUE. 3

III.       PARTIES. 5

IV.       FACTUAL ALLEGATIONS APPLICABLE TO ALL CLAIMS. 10

A.        Hemophilia and Its Treatment 10

B.         Even Before the Discovery of HIV and AIDS, Defendants Failed to Disclose or Warn of Serious Adverse Effects Associated with Factor Concentrates. 11

C.        Defendants Recruited Plasma Donors from High Risk Populations to Manufacture Factor VIII and IX   13

D.        Defendants Failed to Use the Available Hepatitis B Core (HBc) Test to Exclude Plasma from High Risk Donors. 17

E.         Defendants Also Failed to Implement Available Heat Treatment and Solvent Detergent to Kill BloodBorne Diseases. 19

F.         Defendants Continued to Ship Non-Heat Treated Factor Concentrate Products Abroad Even After They Stopped Selling Non-Heat Treated Product in the United States. 20

G.        Defendants Fraudulently Misrepresented the Safety of Factor VIII and IX and Concealed the Dangers of the Products. 21

H.        Defendants’ Activities Were Subject to Applicable Federal Regulations, Which Evidence the Standard of Care With Which Defendants Should Have Complied. 34

I.          Conspiracy, Concert of Action and Group Liability. 36

V.        CLASS ACTION ALLEGATIONS. 40

VI.       TOLLING OF APPLICABLE STATUTES OF LIMITATION.. 42

VII.      CLAIMS FOR RELIEF. 43

First CLAIM FOR RELIEF:  NEGLIGENCE. 43

Second CLAIM FOR RELIEF:  NEGLIGENCE PER SE. 45

Third CLAIM FOR RELIEF:  FRAUDULENT OMISSION AND CONCEALMENT. 46

Fourth CLAIM FOR RELIEF:  BREACH OF IMPLIED WARRANTY.. 48

VIII.     PRAYER FOR RELIEF. 48

DEMAND FOR JURY TRIAL. 50

 

End of TOC - Do not delete this paragraph!

 

 

 

 

 

 

 

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