Title: Wyeth v. Rowatt

State: nevada

Issuer: Nevada Supreme Court

Document:

426 Nev, Advance Opinion 44+

IN THE SUPREME COURT OF THE STATE OF NEVADA

WYETH, A DELAWARE | No, 51234
CORPORATION, AND ITS DIVISIONS

AND SUBSIDIARIES; AND WYETH
PHARMACEUTICALS, INC., A |
DELAWARE CORPORATION, AND ITS |
DIVISIONS AND SUBSIDIARIES, |

Appellants,

vs.
ARLENE ROWATT; WENDELL FILED
FORRESTER, DULY APPOINTED Nov 24 2010
SPECIAL ADMINISTRATOR FOR THE
ESTATE OF PAMELA FORRESTER; fee tS
AND JERALDINE SCOFIELD,
Respondents.

Appeal from a district court judgment, certified as final
under NRCP 54(b), in a tort action. Second Judicial District Court,
Washoe County; Robert H. Perry, Judge.

Affirmed,

Lewis & Roca LLP and Daniel F. Polsenberg and Joel D. Henriod,
Las Vegas; Williams & Connolly LLP and F. Lane Heard IIT and
Heidi Hubbard, Washington, D.C.; Winston & Strawn LLP and Dan
K. Webb, Chicago, Illinois,

for Appellants,

Peter Chase Neumann, Reno; White & Wetherall, LLP, and Geoffrey
P. White and Peter C. Wetherall, Reno; Littlepage Booth and Zoe
Littlepage and Rainey Booth, Houston, Texas,

for Respondents.

‘Law Office of Matthew L. Sharp and Matthew L. Sharp, Reno,
for Amicus Curiae Nevada Justice Association.

10 80972

 

 
BEFORE THE COURT EN BANC.
OPINION

 

By the Court, CHERRY, J.:

‘This case arises from personal injury and strict products
liability actions filed by respondents against appellants after
respondents took appellants’ drugs for years and were subsequently
diagnosed with breast cancer. The matter was presented to a jury,
with the assessment of damages being bifurcated, as respondents
also sought punitive damages against appellants. A verdict was
rendered in respondents’ favor, awarding compensatory and punitive
damages. On appellants’ motion, the district court decreased the
amount of damages but denied appellants’ motion for a new trial and
judgment as a matter of law.?

In this appeal, we are asked to decide three main issues.
First, we must determine whether the district court erred in finding
that Nevada law applied to the underlying action because
respondents were diagnosed with cancer in Nevada, We agree with

the district court’s conclusion, and we adopt the “last event

‘The Honorable Kristina Pickering, Justice, voluntarily
recused herself from participation in the decision of this matter.

*The district court certified the judgment as final under NRCP
54(b), as respondents’ claims against appellants have been fully
resolved and respondents have no claims pending against another
party, Thus, the resolution of respondents’ claims below removed
them as parties from the underlying action. Additionally, other
plaintiffs’ claims remain pending against appellants. See Mallin v.
Farmers Insurance Exchange, 106 Nev. 606, 797 P.2d 978 (1990).

 

 
necessary” analysis to determine choice of law when an injury
involves a slow-developing disease, such as cancer, and under that
analysis the last event necessary for a claim against a tortfeasor is
the place where the plaintiff becomes ill.

Second, we are asked to decide whether the district court
abused its discretion when it gave a substantial-factor causation
instruction, rather than @ butfor causation instruction, and when it
subsequently modified the instruction. We agree with appellants
that the district court abused its discretion when it gave a
substantial-factor causation instruction because each party argued
its own theory of causation, mutually exclusive of the other, and
respondents’ injuries were purportedly only caused by one act.
Nevertheless, the error was harmless, as appellants failed to
demonstrate that their substantial rights were affected so that, but
for the error, a different result may have been reached. The district
court’s modification of the instruction was not an abuse of discretion

as it tailored the instruction to comply with existing scientific

 

consensus, consistent with the evidence presented at tri

‘Third, we address whether the compensatory and
punitive damages awards are supported by substantial evidence and
are excessive, even after the district court reduced the amount of the
awards, Both awards are supported by substantial evidence. As to
the compensatory damages, the awards do not shock our conscience
and, thus, are not excessive, Regarding the punitive damages
awards, the amounts awarded do not violate appellants’ due process
rights, as the awards are reasonable and proportionate to appellants’

actions, or lack thereof. Finally, although the jury improperly and

 

 
prematurely deliberated punitive damages, the error was cured by
the jury's redeliberation and the district court’s subsequent granting
of the remittitur. Because we perceive no reversible errors in the
issues raised on appeal, we affirm the district court's judgment.
FACTUAL AND PROCEDURAL HISTORY
Respondents Arlene Rowatt, Pamela Forrester, and
Jeraldine Scofield all took hormone replacement therapy drugs for a
number of years and later developed breast cancer.? The specific
hormone replacement drugs prescribed to respondents were in one of
two forms: two pills—one estrogen pill and one progestin pill, or a
‘single pill that combined both hormones. Appellants Wyeth and
Wyeth Pharmaceutical, Inc,, manufactured and sold the estrogen pill
Known as Premarin, which was combined with a progestin pill
manufactured by a different pharmaceutical company. Wyeth also
manufactured the combination hormone pill known as Prempro,
Respondents Rowatt and Scofield were prescribed the
‘two-pill hormone medication when they lived in other states. Rowatt
was later prescribed Prempro. After moving to Nevada, and while
still on the medication, both women were diagnosed with breast
cancer. Respondent Forrester, a Nevada resident, was originally
prescribed the two-pill regimen before switching to a Prempro
prescription, Before being diagnosed with cancer, respondent

*Subsequent to the conclusion of the underlying trial,
respondent Forrester passed away from causes unrelated to the
injuries claimed in the district court action. Forrester is represented
on appeal by her husband, Wendell Forrester, as the special
administrator for her estate.

 

 
om

 

Forrester switched to another manufacturer's estrogen-based
hormone produet.

Tn 2004, each woman filed a personal injury and strict
products liability suit against Wyeth in the district court.‘ The three
cases were subsequently consolidated and set for trial. Because
respondents also alleged punitive damages claims against Wyeth, the
trial was bifurcated into two phases. In the first phase, the jury was
to determine whether Wyeth was liable for respondents’ injuries and

the amount of any compensatory damages. ‘The jury was also asked

 

to consider whether Wyeth acted with malice or committed fraud,
and if the jury made either finding, a second trial would be conducted
to determine the amount of punitive damages, if any, to award
respondents,

Respondents had three main theories of liability that
they presented to the jury. First, they contended that Wyeth's
failure to study the estrogen-progestin combination was a legal cause
of their cancer because Wyeth had knowledge that hormone-
receptive organs, such as breast tissue, responded to the introduction
of additional hormones in the body, and Wyeth allegedly failed to
reasonably test the estrogen-progestin combination based on that
knowledge. Second, respondents argued that Wyeth failed to
adequately warn them and their physicians about the breast cancer
risk associated with the estrogen-progestin combination. Third,
respondents alleged that Wyeth’s drugs were unreasonably

‘Respondents Forrester and Scofield also filed claims against
the progestin manufacturer. ‘Those claims were resolved before trial

 
os

 

dangerous because they could cause breast cancer and respondents
purportedly developed breast cancer as a result of taking the
jstrogen-progestin combination, Based on these same theories,
respondents asserted that Wyeth acted with malice, so as to warrant
the award of punitive damages,

At trial, respondents offered evidence of Wyeth’s
development of Premarin and Prempro and various independent
studies of the drugs, The evidence was presented to the jury to
establish that Wyeth’s knowledge that there was a potential
increased risk of breast cancer, combined with its failure to conduct
its own studies to determine the precise risk, was a legal cause of
respondents’ cancers. We begin by examining Premarin’s and
Prempro’s history in conjunction with independent studies.

‘The development of hormone replacement therapy

In 1942, Wyeth introduced Premarin, an estrogen
hormone used to treat menopausal symptoms. By the 1970s, the
medical community had recognized a potential link between the use
of estrogen and endometrial cancer. Wyeth's Premarin sales
aropped. In 1976, Wyeth’s internal documents show that its
researchers knew that the presence of both estrogen and progestin in
‘a tumor indicates that the tumor had responded to hormones. In the
late 1970s, a published scientific article recommended adding
progestin to an estrogen regimen to avoid the risk of developing
endometrial cancer. Consequently, physicians began prescribing
estrogen and progestin. Respondents’ physicians prescribed them
Wyeth's Premarin with another manufacturer's progestin.

 
In 1983, Wyeth sought approval from the FDA to study
and market the combination of estrogen and progestin. ‘The FDA
allowed Wyeth to study the drugs’ combination, but rejected its
application to market the drugs together. The FDA specifically told
Wyeth that a large, long-term study was first needed to evaluate the
drug combination’s safety. An internal Wyeth document shows,
however, that the company viewed such studies as costly and
lengthy, with unpredictable results, In 1988, Wyeth was approached
for funding to conduct a study that con

 

fed of reviewing data of
women who had already been taking estrogen and progestin for a

number of years, Wyeth declined to fund the study. In fact, Wyeth’s

 

documents showed that it had a company policy of not supporting
breast cancer studies.

Starting in the late 1980s and early 1990s, independent
studies were published that linked an increase in breast cancer risk
to the estrogen-progestin hormone therapy regimen. For example, in
1989, a study was published in the New England Journal of Medicine
that showed a 4.4 relative risk’ of breast cancer in premenopausal
women. The study characterized the risk as a “slightly increased
risk of breast cancer” among women who took estrogen plus
progestin for a long time. The 1989 study was followed by another
study shortly thereafter confirming those results. In 1990, another
independent study showed an increased risk of developing breast

The record indicates that a relative risk of 4.4 means that the
risk when using hormone therapy drugs is more than 4 times the
normal risk.

 

 
cancer when the hormone therapy regimen was estrogen plus
progestin. Internal Wyeth documents show that it responded to

studies suggesting a po

 

‘ible breast cancer risk by downplaying the
risk through public relations campaigns and its sales
representatives’ interactions with physicians. Wyeth also created an
internal task force to counteract such findings.

In 1992, the FDA’
insufficient data to determine whether adding progestin to

advisory committee noted that there

 

 

estrogen increased the breast cancer risk. Wyeth’s internal
documents revealed that it was pleased that its efforts resulted in
the FDA’s conclusion that the risk was uncertain. That same year,
Wyeth provided its drug to the National Institutes of Health, which
was conducting a study called the Women’s Health Initiative (WHD).
‘The WHI consisted of 27,000 postmenopausal women grouped into
two substudies to assess the risks and benefits of taking estrogen
plus progestin or estrogen alone as compared to @ group taking only
placebos. This long-term study was halted in 2002 because a
significant number of women on the estrogen-progestin combination
had developed cancer.

In 1994, Wyeth sought approval from the FDA to market
Prempro. Along with its request, Wyeth submitted at least 14
different breast cancer studies, including a quantitative statistical
analysis of 31 breast cancer studies performed at Wyeth’s request.
The FDA, relying on the studies, approved Prempro as safe and
effective. Its approval, however, was conditioned on Wyeth
conducting a large-scale clinical trial on bone mineral density and

the breast cancer risk to obtain comprehensive answers about breast

 

 
cancer. The breast cancer issue was highlighted as the most
important issue concerning hormone therapy drugs. ‘The FDA also
recognized that it would take many years of studying the drug before
the relationship between estrogen, progestin, and breast cancer could
be definitively determined.

Prempro’s approval was also conditioned on precise
warning-label language. The FDA modified Wyeth’s proposed
warning label. The modified warning informed readers that “[sJome
sk of breast cancer.”

kof

studies have reported a moderately increased
‘The label noted that “[t]he effect of added progestins on the
breast cancer is unknown, although a moderately increased risk in

 

 

those taking combination estrogen/progestin therapy has been
reported.” The label also stated that the rate of breast cancer that
showed up in Wyeth’s own human study did “not exceed that
expected in the general population.” Wyeth, however, never
conducted its own human study.

With the launch of Prempro, Wyeth became the first
pharmaceutical company to combine estrogen and progestin into one
pill. Although Wyeth knew there were no long-term studies on the
safety of estrogen plus progestin, it recommended Prempro’s use for
“all women for life.”

‘A 1996 published European study showed that the
estrogen-progestin combination increased the breast cancer risk for
thin or lean women. Following that study, Wyeth updated its

European label warning, but did not update its warning label in the
United States. Wyeth specifically cautioned its “Breast Cancer
Working Group” to keep the article “confidential, [and] not discuss

 

 
[it] with anyone outside of Wyeth.” 'T

 

imony indicated that Wyeth
developed a plan to minimize the study and divert attention from it.
Wyeth contended, however, that the marketing strategy to counter
this European study was never utilized.

By 1997, Wyeth had not begun a comprehensive clinic

 

trial, as required by the FDA. Even so, Wyeth requested and the
FDA agreed that Wyeth could rely on the WHI study to fulfill its
commitment.

By 2000, a number of published scientific articles linked
hormone replacement drugs to an increased risk for breast cancer.
Evidence showed that Wyeth responded to these articles by creating
a task force and adding $40.4 million to its large yearly marketing
budget to counter rising consumer awareness about the relationship
between breast cancer risk and hormone replacement therapy.
Wyeth also began promoting Prempro’s unproven, and later
debunked, heart and mental health benefits in television
advertisements and informational pamphlets, guides, and textbooks.
‘The promotional materials failed to mention any breast cancer risk.
‘The FDA admonished Wyeth for recommending its drugs for
unapproved benefits as a violation of FDA regulations. As it
pertained to those promotional materials, Wyeth disregarded the
admonition, and the FDA never sanctioned Wyeth for the improper
practices, In another situation involving different promotional
materials that Wyeth intended to send to its hormone therapy

consumers, Wyeth complied with the FDA’s warnings to omit
information about unapproved benefits.

 

 
Over the years, Wyeth sponsored 51 medical articles by

selecting different physicians to author the articles, when in fact

 

Wyeth personnel wrote the articles or provided the substance for the
articles. Wyeth's involvement with those articles was never
identified, Published under independent doctors’ names, the 61
ghostwritten medical articles touted the benefits of hormone
replacement therapy while minimizing the breast cancer risk.

In July 2002, the Prempro arm of the large-scale WHI
study was terminated because the data showed an increased risk of
invasive breast cancer, coronary heart disease, and stroke. The WHI
study also concluded that estrogen plus progestin did not provide any
cognitive benefit for women 65 and older, but actually caused a

decline in cognitive functioning. Respondents’

 

jdemiological expert
testified that the use of estrogen plus progestin caused
approximately 8,000 to 15,000 extra breast cancers each year for
women between 50 to 69 years of age.

After the WHI study results were released, prescriptions
for the standard dose of estrogen plus progestin dropped by 80
percent. Similarly, the number of diagnosed hormone-receptor-
positive breast cancers—cancers in which tumors show an active
hormone receptor—also fell.

Following the WHI study, Wyeth introduced a new, lower
dose estrogen-progestin pill called Prempro Low. This lower-dose
treatment is recommended only as a second-line treatment and for
the shortest duration necessary. It also carries the strongest
warning possible—a “black box” warning—and informs the consumer

that the risk of breast cancer increases with prolonged use.

 

 
oe

 

With this background in mind, we discuss the procedural

posture of the underlying district court case.

 

Expert testimony was presented from both sides
regarding the cause of respondents’ breast cancer. Respondents
argued and presented evidence that, but for ingesting estrogen plus
proge:
that the cause of respondents’ cancer is unknown, that the prescribed

 

. they would not have developed cancer. Wyeth countered

hormone therapy drugs did not cause their cancer, and that
respondents had other risk factors for breast cancer.

Respondents’ epidemiologist and oncologist testified that
breast cancer can be caused either by initiation, where an agent
damages a cell's DNA and causes the first abnormality, or by
promotion, when a substance, such as Wyeth’s hormone-therapy
drugs, causes an already existing abnormal cell to grow from a
benign lesion into cancer. The oncologist testified that hormone-
deficient women, such as respondents, have a lower risk of
developing hormone-receptor-positive breast cancer after menopause.
‘The expert testified that the risk is low because hormone-deficient
women’s bodies lack sufficient hormones to cause abnormal cells to
grow into cancer. The oncologist stated that once the stimulus, i.e.,
hormone replacement drugs, are removed, the hormone-positive
‘tumors shrink. On cross-examination, respondents’ epidemiologist
testified, however, that after menopause, a women's chance of
developing cancer increases even while the woman’s hormone levels
are naturally decreasing. Thus, according to the epidemiologist, the

12

 
presence of an estrogen receptor does not consistently determine that
‘a tumor's growth was caused by the estrogen receptor.

Respondents argued that the WHI study demonstrated
that the rate of breast cancer with the use of hormone replacement
therapy had a quadrupling of the relative risk; consistent with
carlior studios, the WHT study initially indicated a relative risk of
1.24, but further analysis of the WHI study showed a 4.61 relative
risk for women who took estrogen plus progestin for more than five
years, Respondents’ experts explained that this discrepancy
occurred because not every woman who enrolled in the study abided
by its terms, In other words, the 1.24 relative risk took into account
the total number of women who enrolled in the study, but the 4.61
relative risk included only those women who stayed in the study and
took the medication as directed. Wyeth acknowledged the risk, but
insisted that the relative risk was only 1.24, which was less than the
1.8 to 2.0 risk that it provided in Prempro's warning label.

Respondents’ oncologist also testified that respondents’
tumors were studied and showed the presence of estrogen and
progestin receptors. Thus, the oncologist testified that respondents’
breast cancer was caused by hormones, as they had developed
estrogen and progestin receptor-positive breast cancer. Respondents
argued that because they introduced hormones into their bodies,
through the prescribed hormone therapy drugs, they were put at a
greater risk for developing hormone-positive breast cancer.
According to respondents’ oncologist, but for taking the hormone

therapy drugs, respondents would not have developed cancer.

 

 
Wyeth solicited evidence from respondents’ oncologist
and epidemiologist that science does not know exactly what causes
breast cancer and that respondents had other risk factors for
developing breast cancer. ‘The specific risk factors included
respondents’ gender, their age, the denseness of their breasts, that
each woman was a long-time smoker, that they all had previous
biopsies to remove benign lesions, and the overall number of years
that the women had menstrual cycles. Respondents’ experts also

 

testified on cross-examination that all three women had abnormal
cells before taking the hormone replacement therapy. Respondents
Rowatt and Forrester had an additional risk factor: they were both
overweight. Testimony also showed, however, that respondents’
physicians did not believe that respondents were at risk for cancer
because they had no family history of breast cancer and none of them
had ever taken birth control.

Respondents’ oncologist, on direct examination,
discounted the majority of respondents’ existing risk factors. The
expert testified, for instance, that respondents’ dense breast tissue
would not be a significant risk factor, as during menopause women
tend to lose density in their breasts. On cross-examination, the
oncologist conceded, however, that the same is not true for every
woman. Respondents’ oncologist and Wyeth’s radiology expert
disagreed as to whether respondents’ breast density had changed
while on hormone replacement therapy.

Respondents’ epidemiologist and cancer biologist
physician testified that it could be anywhere from a few to 40 years

for a benign lesion to turn into cancer. ‘The oncologist explained that

 

 
respondents’ cancers were not detectable for years because the
women did not have preexisting cancer cells. ‘Thus, in respondents’
case, it took years for the estrogen-progestin drug combination to
fertilize respondents’ abnormal cells and develop the cells into

cancer. Further expert testimony was presented that recent medical

 

literature confirmed that _estrogen-progestin-receptor-positive

cancers have an even higher statistical chance of recurrence than

 

other breast cancers, At the time of trial, none of respondents’ breast
cancer had spread, and respondents were in remission.
Respondents’ hormone replacement therapy history

Each respondent testified at trial as to how long she had
been taking hormone therapy drugs. Respondent Rowatt testified
that she had taken the drugs for a total of 7 years while living in
Oregon and approximately 5 months after moving to Nevada;
respondent Forrester, a Nevada resident, took the drugs for 9 years;
and respondent Scofield took the drugs for 14 years while living
outside Nevada, then for approximately 1 year after she moved to
Nevada. Respondents were all diagnosed with breast cancer while
living in Nevada.

Respondents testified regarding the affects their
diagnoses had on them and their families; how, following their
diagnoses, they underwent various surgeries to remove the cancer;
and the resulting effects, both physical and mental, that they
experienced from the surgeries. Evidence was also presented about
respondents’ various post-surgery treatments, such as chemotherapy
or radiation and projected years of medication necessary to prevent

the recurrence of cancer. Respondent Forrester testified that she

 

 
one

 

was unable to take any post-surgery medication due to the severe
side effects,

As to the drug labels, respondent Rowatt testified that

 

she knew there was a risk of breast cancer, but after discussing the
risk with her doctor, she did not think that she was in the risk
category because she did not take birth control pills and there was no
family history of breast cancer. Respondent Forrester testified that
she was unaware of any risks because her doctor failed to have that
discussion with her; she never asked about any risks. Respondent
Scofield testified that she never saw the drug’s warning label, as she
received her prescriptions at military bases, and she testified that
the warning inserts were not provided. All three women testified
that if they had known of the risk of breast cancer, they would not
have taken the medication, Each of their health care providers
testified that when they prescribed the hormone therapy drugs, they
believed that the benefits outweighed the risks. Following the WHI
study, their opinions changed.

Respondents further testified about their post-cancer
lives. They all testified as to how they try to lead normal lives, but,
are always fearful that the cancer will return. Respondents’
oncologist expert testified that there is always a possibility that the
cancer could return.

‘The jury’s verdict

At the close of evidence, the parties and the district court
settled the jury instruetions. Due to respondents’ objection to the
bifurcation instruction, the district court did not inform the jury that
a second trial would be held if the jury found that Wyeth acted with
malice or fraud. Wyeth did not object. The parties agreed to a but-

16

 
for causation instruction, yet, the district court gave a substantial-
factor causation instruction. Wyeth objected, but the court
responded by modifying its proposed substantial-factor causation
instruction.

After the jury was instructed and the parties made
closing arguments, the case was submitted to the jury. The jury
returned verdicts in favor of respondents totaling $134.6 million in
compensatory damages. The jury also found that Wyeth had acted
with malice or fraud, Because the jury made this last finding, the
court ordered the jury to return for a trial on punitive damages.

Before the punitive damages phase began, the district
court learned and confirmed that the jury had awarded punitive
damages along with the compensatory damages. Wyeth moved for a
mistrial, which was denied. The district court reinstructed the jury
‘on the law of compensatory damages, and the jury was directed to
deliberate again, but solely on compensatory damages. It returned
three compensatory damages awards totaling $36.1 million.

For the punitive damages phase, the jury was instructed
on assessing punitive damages. Evidence was presented regarding
Wyeth’s financial condition and following deliberations the jury
returned three punitive damages awards totaling $99 million.

Wyeth moved for a renewed judgment as a matter of law
and a new trial or, in the alternative, remittitur. Respondents
opposed the motions. The district court denied the renewed motion

for judgment as a matter of law and the new trial motion, but

granted the remittitur. Tt reduced the compensatory damages to $23
million and the punitive damages to $57,778,909; respondents

 

 
 

accepted the remittitur. This appeal followed. The Nevada Justice
Association was granted leave to file an amicus brief in support of
affirmance.
DISCUSSION

We begin our analysis by determining the threshold
issue of whether the district court properly decided choice of law. We
take this opportunity to provide Nevada courts with guidance for a
choice-of-law analysis when a slow-developing disease is involved.
This discussion is followed by Wyeth’s challenges to the jury
instructions. And finally, we address the compensatory and punitive
damages awards,

view

‘This court reviews de novo a district court's denial of a
motion for judgment as a matter of law. Winchell v. Schiff, 124 Nev.
938, 946-47, 193 P.3d 946, 952 (2008). We review a district court's
decision to deny a new trial motion for an abuse of discretion. Nelson
v. Heer, 123 Nev. 217, 223, 163 P.3d 420, 424-25 (2007). Appellate
issues involving a purely legal question are reviewed de novo.
Settelmeyer & Sons v. Smith & Harmer, 124 Nev. 1206, 1215, 197
P.34 1051, 1057 (2008),
‘The district court properly concluded that Nevada law applied

Wyeth contends that the district court erred when it
determined that Nevada law applied to respondents Rowatt’s and
Scofield’s claims because they lived in other states while taking
Wyeth's hormone replacement therapy, and thus, the laws of the
states where they lived when the disease process began should have
been applied to their claims. Respondents counter that Nevada
constitutes the “legal” place of injury because the final event

18

 
necessary to assert a claim against Wyeth did not exist until the
women were diagnosed in Nevada with breast cancer. We agree with
respondents.

This court has adopted the Re:
Conflict of Laws, section 146, for determining the choice of law for
personal injury cases. General Motors Corp. v. Dist. Ct., 122 Nev.
466, 474, 194 P.3d 111, 117 (2006). Section 146's general rule

 

itement (Second) of

 

 

provides that the state's law where the injury occurred governs the
rights and liabilities of the parties. Restatement (Second) of Conflict
of Laws § 146 (1971). To make a proper choice of law under section
146, the court must apply the section's general place-of-injury rule,
unless a party presents evidence that another state has a more
significant relationship with the alleged tortious conduct and the
parties. General Motors Corp,, 122 Nev. at 474, 134 P.3d at 117
Section 146 has defined “personal injury” as “either physical harm or
mental disturbance, such as fright and shock, resulting from physical
harm or from threatened physical harm or other injury to oneself or
to another.” Restatement (Second) of Conflict of Laws § 146 emt. b.
More than one type of personal injury can arise from a single event.
Id.

We have not yet defined what constitutes the place of
injury for a slow-developing disease such as cancer, and we take the
opportunity to do so now. Wyeth argues that courts have held that

the place of injury for a slow-developing disease is the state where
the disease process begins. See Rice v. Dow Chemical Co., 875 P.2d
1213, 1218-19 (Wash. 1994); Clayton v. Eli Lilly and Co., 421 F.
Supp. 2d 77, 79-80 (D. D.C. 2006): Smith v. Walter C. Best, Inc., 756

 

 
F. Supp. 878, 880-81 (W.D. Pa. 1990); Harding v. Proko Industries,
Inc, 765 F. Supp. 1053, 1056-1057 (D. Kan. 1991). Other courts,
however, have determined that the place of injury for slow-
developing diseases is the place where the disease, or injury, was
first ascertainable, See generally Renfroe v, Eli Lilly & Co,, 686 F.2d
642, 645-47 (Sth Cir. 1982) (holding that there is no legally
compensable injury to sue upon until a slow-developing disease
detected); In re Joint Eastern & Southern Dist, Asbestos Lit., 721 F.
‘Supp. 433, 435 (B.D. and S.D.N.Y. 1988) (concluding that the last act
necessary for a claim against a tortfeasor refers to the place where
the plaintiff became ill); Trahan v. E.R. Squibb & Sons, Inc, 567 F.
Supp. 505, 507 (M.D. Tenn, 1983) (recognizing that the “law of the

 

 

state where injury was suffered controls,” rather than the state's law
where the tortious conduct occurred).

We reject the cases cited by Wyeth and adopt the
analysis of the cases that recognize that the place of injury is the
state where the slow-developing disease is first ascertainable, which
is the last event necessary for a claim against a tortfeasor.
Designating the place of injury as the state where the last element
necessary for a claim against the tortfeasor occurs conforms to our
definition of injury. See Massey v. Litton, 99 Nev. 723, 725-26, 669
P.2d 248, 250-51 (1983) (defining “injury,” in the context of medical
malpractice, as a legal injury in which the plaintiff has suffered
damages and knows or has reason to know of the health care

provider's negligence). This analysis will also guide district courts in

making a choice-of-law decision when a slow-developing disease is
involved. The rule adopted in this opinion is preferable to Wyeth's

 

 
om

 

approach because until a slow-developing disease is detected, there is
no legally compensable injury to sue upon.

For example, in Renfroe v. Eli Lilly & Co., 686 F.2d 642,
645 (8th Cir. 1982), the Eighth Circuit Court of Appeals affirmed the
lower court's determination that the plaintiffs’ injuries occurred in
the state where their injuries were ascertainable. The lower court
specifically recognized that a cause of action does not accrue until the
“final element of the cause of action occurs.” Id, at 645, The Renfroe

plaintiffs wore exposed to the defendants’ anti-miscarriage drug

 

while in utero. Id, at 644. Both plaintiffs’ exposure occurred in
Missouri and both plaintiffs eventually moved to Californi

 

where
their cervical cancers were diagnosed. Id, The plaintiffs filed suit
against the defendants, who moved for summary judgment on the
basis that the plaintiffs’ claims were barred by the relevant statute of
limitations. Id, at 644-45. ‘The lower court ultimately found that the

 

plaintiffs’ claims did not originate in Missouri, where the exposure to
the harmful drug occurred, but where the plaintiffs’ damages were
sustained and capable of determination. Id, at 646, In affirming the
lower court, the Renfroe court noted that the plaintiffs’ damages
claims were not based on the physiological or genetic injuries
sustained in utero, but rather on the development of cancer and
resulting surgeries. Id, at 647. Thus, the Renfroe court held that the

“Our adoption of the “last event necessary” test for the place-
of-injury rule is not to be confused with the plaintiff's discovery of his
or her illness, which implicates the beginning of the limitation
period. Asbestos Lit, 721 F. Supp. at 435.

a

 
plaintiffs’ injuries originated in the state where their cancer had
developed and was ascertainable. Id.

‘Turning to the present case, the record shows that
respondents Rowatt and Scofield were both exposed to estrogen plus

progestin for a number of years while living in other

 

ates, however,
the last event necessary to give rise to their claims against Wyeth
occurred in Nevada, when the women were diagnosed with cancer.
Their cancer was not detected while they lived in other states, even
though the cancerous tumors may have been developing while they
lived in those states.

‘This does not conclude the choice-of-law inquiry. Under
Restatement section 146, if a party submits sufficient evidence that

 

another state's law applies based on the parties’ relationship and the
tortious conduct, we move past the general place-of-injury rule. See
General Motors Corp, v. Dist. Ct 122 Nev. 466, 474, 134 P.3d 111,
117 (2006). Here, Wyeth argues that Nevada does not have a
significant relationship to the alleged tortious conduct, as
respondents Rowatt and Scofield ingested the hormone therapy
drugs for 7 and 14 years, respectively, while living in other states,
We conclude, however, that these facts are not sufficient to
demonstrate that states other than Nevada have a more significant
relationship.

Specifically, after moving to Nevada, the women
continued taking the hormone therapy drugs. Respondents Rowatt
and Scofield were diagnosed with breast cancer in Nevada, and they
were Nevada residents at that time. They underwent the physical

and emotional pain and suffering of their breast cancer surgeries and

 

 
 

oe

 

post-surgery medical treatments in Nevada. Since their surgeries,
both women have had follow-up medical care, in Nevada, to detect if
their breast cancers had returned. No evidence was presented that
either respondent has moved from Nevada. Thus, even under the
‘most-significant-relationship test, we conclude that Nevada law
applies, as Wyeth failed to demonstrate that another state has a

more significant relationship to the women’s injuries or the parties’

 

relationship.

Because we conclude that the place of injury for
respondents Rowatt and Scofield was in Nevada and that Nevada
has the most significant relationship to the injuries and parties’
relationship, we thus conclude that the district court did not err or
abuse its discretion in denying Wyeth’s motion for judgment as a
matter of law or a new trial based on choice of law.7

7We also conclude that the district court did not abuse its
discretion in submitting the statute of limitations questions to the
jury, as the district court properly found that material questions of
fact existed. Allstate Insurance Co, v. Miller, 125 Nev. _, __, 212
P.3d 318, 322 (2009) (recognizing that when questions of fact exist
concerning a triable issue, the district court does not abuse its
discretion when it submits the questions to the trier of fact for
resolution); Siragusa v. Brown, 114 Nev. 1384, 1391, 971 P.2d 801,
806 (1998) (providing that when a claimant discovered or should
have discovered the facts constituting a cause of action is a question
of fact for the jury).

 
the district court did not abuse its discretion when it modified the
cauisation instruction, but the evidence supported a but-for causation

instruction

Wyeth raises two challenges to the causation instruction
given by the district court to support its contention that a new trial is
warranted. First, it argues that the district court abused its
discretion in giving a substantial-factor causation instruction instead
of a but-for causation instruction. Second, Wyeth contends that the
abuse of discretion was compounded when the district court amended
the substantial-factor instruction to adopt respondents’ theory of
causation, which rendered the instruction partial and prejudicial.

At the close of testimony, both parties requested that the
jury be instructed that Wyeth could be held liable for respondents’
injuries if the jury determined that, but for taking Wyeth’s drugs,
respondents would not have developed breast cancer. Despite the
parties’ request, the district court concluded that a substantial-factor

causation instruction was warranted because sufficient evidence w:

 

presented to the jury to suggest that there were multiple causes of
respondents’ breast cancer. Wyeth objected to the court’s proposed
instruction, which the district court overruled. The district court
‘modified the “substantial-factor” pattern jury instruction by tailoring
it to the evidence presented, The pattern instruction states that “[a]
legal cause of injury, damage, los
substantial factor in bringing about the injury, damage, loss, or
harm,” Nev, J.1. 4.04A (emphasis added). The district court replaced

or harm is a cause which is a

   

“bringing about” with “producing or promoting.”

‘The district court's decision to give or refuse a particular

instruction will not be overturned absent an abuse of the district

 

 
court's discretion or judicial error. Countrywide Home Loans v.
‘Thitchener, 124 Nev. 725, 735-36, 192 P.8d 243, 250 (2008). “A party
is entitled to an instruction on every theory that is eupported by the
evidence, and it is error to refuse such an instruction when the law
applies to the facts of the case.” Woosley v, State Farm Ins, Co,, 117
Nev, 182, 188, 18 P.3d 317, 321 (2001); accord Posas v, Horton, 126
Nev. __, 228 P.3d 457 (2010). A district court is not bound by the
suggested language of the standard instructions and is free to adapt
them to fit the circumstances of the case. In_re Prempro Products
Liability Litigation, 586 F.3d 547, 567-68 (Sth Cir. 2009); Cedars-
Sinai_Medical Center v. Superior Court, 954 P.2d 511, 517 (Cal.
1998). A but-for causation instruction applies when each party

 

argued its own theory of causation, the two theories were presented
as mutually exclusive, and the cause of the plaintiff's injuries could
only be the result of one of those theories, but not both. Johnson v.
Exgtedar, 112 Nev. 428, 436, 915 P.2d 271, 276 (1996). A substantial-
factor causation instruction is appropriate when “an it

 

jury may have
had two causes, either of which, operating alone, would have been
sufficient to cause the injury." Id, at 435, 915 P.24 at 275-76.

The causation theories advanced by the parties were
‘mutually exclusive. Respondents presented evidence that Wyeth's

drugs were the sole cause of their injuries. Wyeth countered by

"We leave open the issue of whether the substantial-factor
instruction applies in negligence cases. See Mitchell v. Gonzales,
819 P.2d 872, 878 (Cal. 1991) (holding that the “substantial factor”
jury instruction subsumes the “but for” instruction in negligence
cases).

 

 
presenting evidence refuting that claim on the basis that science has
not yet determined what causes cancer and that respondents had
numerous risk factors that increased their chances of developing
cancer without taking the hormone replacement medication.
Although Wyeth elicited testimony from respondents’ experts that
respondents had other risk factors for developing breast cancer,
respondents’ experts gave little significance to those factors. Thus,
contrary to the district court's conclusion, the evidence supported a
but-for causation instruction, We conclude, however, that the error
was harmless.

An error is harmless when it does not affect a party's
substantial rights. NRCP 61. When an error is harmless, reversal is
not warranted. Id.; see also Countrywide Home Loans, 124 Nev. at
747, 192 P.3d at 257. But if the moving party shows that the error is
prejudicial, reversal may be appropriate, Cook v, Sunrise Hospital &
Medical Center, 124 Nev. 997, 1006-07, 194 P.8d 1214, 1219-20
(2008). ‘To establish that an error is prejudicial, the movant must
show that the error affects the party’s substantial rights so that, but
for the alleged error, a different result might reasonably have been
reached. Id, at 1007, 194 P.3d at 1220; El Cortez Hotel, Inc. v.
Coburn, 87 Nev. 209, 213, 484 P.2¢ 1089, 1091 (1971). The inquiry is
fact-dependent and requires us to evaluate the error in light of the
entire record. Carver v. El-Sabawi, 121 Nev. 11, 14, 107 P.8d 1283,
1285 (2005); Boyd v. Pernicano, 79 Nev. 356, 359, 385 P.2d 342, 343
(1963)

Here, the appellate record shows that during trial,

evidence was presented that respondents were hormone-deficient

 

 
women; however, respondents were diagnosed with estrogen-
progestin-receptor-positive breast cancer only after taking Wyeth's
Premarin and a progestin pill or Wyeth’s Prempro for many years.
In other words, the cells in respondents’ breast tissue responded to
the presence of hormones in respondents’ bodies. The hormones
present in their bodies, however, were the result of ingesting
Premarin and progestin or Prempro. Thus, the jury concluded that
Wyeth's drugs caused respondents’ cancer tumors.

Scientific evidence supported the jury's conclusion, The
WHI study showed an increased risk of invasive breast cancer with
the use of estrogen and progestin and a 4.61 relative risk for women
who took estrogen plus progestin longer than 6 years, meaning that
respondents, who took the drugs for more than 5 years, had more
than 4 times the normal risk of developing breast cancer. Even
Wyeth classified this as a substantial risk. The post-WHI label now
warns that ‘{t]he excess risk [of breast cancer] increased with
duration of use.” After the WHI study was published, those breast
cancer cases commonly associated with hormone therapy dropped
significantly. Thus, the district court's instructional error was
harmless, as it did not substantially affect Wyeth's rights, and
reversal is not supported based on this contention

Finally, Wyeth argues that the district court abused its
discretion by amending the substantial-factor instruction to adopt
the language of respondents’ experts by substituting “promotion” into
the instruction’s language, which represented respondents’ theory of
causation, Wyeth contends that in doing so, the district court diluted

the concept of causation and rendered the instruction both partial

 

 
and prejudicial. Respondents support the district court's
‘modification, as they assert that it was within the district court's
broad discretionary authority to tailor the instruction to fit the
evidence presented.

At trial, respondents’ epidemiologist expert testified that
the concept of “promotion” is recognized in epidemiological textbooks
as a mechanism for causation. Experts for both parties recognized
the scientific theory that breast cancer can be caused either by
initiation, whereby an agent damages the DNA of a cell and causes
the first abnormality, or by promotion, which occurs when a
substance causes an abnormal coll to grow from a benign lesion into
cancer. Because neither respondents nor Wyeth alleged initiation,
the district court limited the instruction to promotion. Wyeth’s
experts may have contested whether its drugs caused breast cancer
through promotion, but its experts nonetheless recognized the
scientific principle of promotion. Accordingly, the district court's
decision to give the modified causation instruction was not an abuse
of discretion, as it was tailored to comply with existing scientific
consensus and was consistent with the evidence presented at trial.”

"We do not consider Wyeth’s argument that the distriet court
improperly gave a life-expectancy jury instruction when neither
party requested it because Wyeth failed to provide authority to
support its argument. Mainor v, Nault, 120 Nev. 750, 777, 101 P.3d
808, 326 (2004). As to Wyeth’s argument that the given instruction
misled the jury because it was not aware that respondent Forrester
had terminal lung cancer, we conclude that reversal is not warranted
on this issue because the district court reduced the compensatory
damages awards.

 

 
 

Compensatory and punitive damages awards

Wyeth primarily raises two arguments concerning the
district court's compensatory and punitive damages awards. First,
Wyeth argues that its compliance with federal regulations negates

the imposition of punitive damages. Second, Wyeth argues that the

 

awards are not supported by substantial evidence and that, even

after remittitur, they are excessive.

automatically insulate a defendant from punitive damages

Wyeth argues that because it complied with all FDA
requirements for labeling and testing its drugs, the imposition of
punitive damages is negated. Wyeth points out that its position on
the breast cancer risk reflected the available scientific evidence,
which at the time, provided sufficient warning about the breast
cancer risk, and at any rate, its drug remains FDA approved and
continues to be prescribed. Wyeth urges this court to follow a line of
cases that hold that compliance with FDA regulations negates malice
such that punitive damages should not be awarded. We decline to do
£0.

While the cases cited by Wyeth allowed the defendants to
avoid punitive damages by complying with federal standards, those
cases’ holdings are inapplicable to the facts presented in this case
See, e.g., Richards v. Michelin Tire Corp., 21 F.3d 1048, 1059 (11th
Cir. 1994) (holding that compliance with federal and industry
standards is “some evidence of due care” and that insufficient
evidence was presented to demonstrate that the tire manufacturer
failed to warn, as the manufacturer complied with both standard:
Nader v. Allegheny Airlines, Inc., 626 F.2d 1031, 1085 (D.C. Cir,

 

29

 
1980) (concluding that punitive damages were not warranted when
the airline complied with federal standards and such standards were
in the public's interest); Boyette v. LW, Looney & Son, Inc., 932 F.
Supp. 1344, 1348 (D. Utah 1996) (holding that the adequate warning,
which complied with OSHA standards, did not justify an award of
punitive damages); In re Miamisburg Train Derailment, 725 N.E.2d
738, 752 (Ohio Ct. App. 1999) (stating that although compliance with

 

industry standards did not negate negligence, such compliance
negated the lower court’s finding that defendants consciously
disregarded the safety of others). Unlike these cases, Wyeth’s
conduct was fraught with reprehension and deception, and if this
court adopts the policy that Wyeth seeks, potentially every company
that complied with federal regulations would be absolved of punitive
damages, regardless of the manner in which those requirements
were allegedly satisfied. See Silkwood v, Kerr-McGee Corp., 769
F.2d 1451, 1456-58 (10th Cir. 1985) (upholding punitive damages
award despite defendant's compliance with federal nuclear safety
regulations); Gonzales v. Surgidev Corp. 899 P.2d 576, 590 (N.M.
1995) (holding that “compliance with federal regulations does not
preclude a finding of recklessness or an award of punitive damages”);
Grve v. Dayton-Hudson Corp... 297 N.W.2d 727, 734-35 (Minn. 1980)
(determining that compliance with the Flammable Fabrics Act of
1953, while relevant to the issue of punitive damages, does not
preclude a punitive damages award as a matter of law).

Other courts have recognized that FDA regulations for

drug manufacturers are generally viewed as establishing minimum
standards for product design and warning. Rite Aid v. Levy-Gray,

 

 
 

=

876 A.2d 115, 132 (Md. Ct. Spee. App. 2005); see also Brochu v. Ortho
Pharmaceutical Corp,, 642 F.2d 652, 658 (Ist Cir. 1981) (recognizing
that FDA approval of warning language is not necessarily conclusive
on the question of the warning’s accuracy). The United States
Supreme Court has recognized that under the FDA’s regulations, a
drug manufacturer is responsible for the content of its drug label and
ensuring that the warning remains adequate as long as the drug is
on the market. Wyeth v, Levine, 555 U.S. __, _, 129 S. Ct. 1187,
1197-98 (2009). Thus, if a drug manufacturer knows, or has reason

 

to know, of increased dangers that are not already identified in its
drug's label, compliance with the FDA's minimal standard may not
satisfy its duty to warn, Stevens, 507 P.2d at 661; McEwen v, Ortho
Pharmaceutical Corporation, 528 P.2d 522, 634 (Or. 1974),

Although Wyeth presented evidence that its drug label
warned women and physicians that there was a risk of breast cancer,
these warnings were inadequate because they were misleading.
Evidence was presented that Wyeth financed and manipulated
scientific studies and sponsored medical articles to downplay the risk
of cancer while promoting certain unproven benefits. The evidence
demonstrated that Wyeth used these same publications to mislead
respondents’ physicians. Additionally, Wyeth recommended and
promoted its drug for “all women for life,” knowing that a large, long-
term study was needed to definitively address breast cancer risks
associated with its products. The studies that were developed over
the years demonstrated that the breast cancer risk increased over
time. While estrogen-progestin hormone therapy remains approved
by the FDA and is still available on the market, Wyeth’s particular

31

 
drug, Prempro, is in a new lower dosage and carries a more serious
warning that recommends its use only as a second-line treatment
and for short durations. Therefore, we reject Wyeth’s contention that
compliance with FDA standards negates its liability for punitive
damages, as Wyeth should not be able to benefit from its malicious
and deceptive practices. See State Farm Mut. Automobile Ins, Co. v.
Campbell, 538 U.S. 408, 416 (2003) (holding that punitive damages
are aimed at deterrence and retribution).

by substantial evidence and are not excessive
Procedural overview

‘To understand Wyeth’s damages arguments, we begin
our discussion with a brief overview of the underlying damages
phases of the proceedings. In particular, after deliberations, the jury
returned verdicts in the amount of $134.6 million in compensatory
damages. The jury found that Wyeth was negligent, its products
were defective, and that Wyeth concealed material facts about its
products’ safety. ‘Thus, the jury found that Wyeth’s drugs and
actions were a legal cause of respondents’ injuries. ‘The jury also
found that respondents established by clear and convineing evidence
that Wyeth acted with malice or fraud. Because of this last finding,
the jury returned for a second trial regarding punitive damages.

Before the punitive damages phase began, the district
court discovered that punitive damages were inadvertently awarded

in the trial’s first phase. Wyeth moved for a mistrial, which was

 

denied. The district court subsequently reinstructed the jury and

required it to redeliberate solely on compensatory damages.

 

 
‘Thereafter, the jury returned a compensatory damages award of
$35.1 million for all three respondents.

‘The jury received subsequent instructions on assessing
punitive damages for the second phase of trial, Evidence was
presented regarding Wyeth's financial condition. After deliberating,
the jury returned punitive damages awards that totaled $99 million.
Wyeth moved the district court for a new trial based, in relevant
part, on irregularities in the deliberations, In the event that the
district court denied Wyeth's new trial motion, it also requested that
the district court reduce both damages awards. Respondents
opposed Wyeth’s motions. ‘The district court denied Wyeth’s motion
for a new trial, but granted the motion for a remittitur. Respondents
accepted the remittitur.

As to remitting the compensatory damages awards, the
district court found that little evidence was presented regarding
respondents’ actual damages. The parties had stipulated to the
amount of respondents’ past medical bills, but no evidence was
presented as to the cost of any future medical expenses. The district
court recognized that the compensatory damages awards were
primarily for respondents’ pain, suffering, and emotional distress.
The court also found that the jury’s premature deliberation of
punitive damages impacted the compensatory damages awards.
‘Thus, the district court concluded that the compensatory damages
verdicts were the result of passion and prejudice.

‘The district court thereafter remitted the compensatory
damages awards from $35.1 million to $23 million. In remitting the
awards, the district court reduced the past damages awards from

 

 
 

approximately $7.5 to about $4.5 million. As for future damages, the
district court reduced the $36 million awarded to respondents
Rowatt and Scofield to $3 million and $2.75 million, respectively, and
remitted respondent Forrester’s future damages award from $40

million to $3.4 million. When it reduced the compensatory awards

 

the district court noted that it was not discounting the

 

ignificant
injuries respondents suffered. It recognized that respondents’ cancer
diagnoses had serious lifelong physical and emotional consequences
and that there existed the possibility of recurrence.

With regard to reducing the punitive damages awards,
the district court abated those verdicts from $31 to $10 million for
respondent Rowatt, $33 to $12 million for respondent Scofield, and
$35 to $13 million for respondent Forrester. This decision was based
‘on evidence that Wyeth provided a breast cancer warning, although
arguably inadequate, and that it sponsored some limited testing.

 

Respondents accepted the remittitur of $57.8 million in punitive

damages,

Standard of review

‘This court will affirm a damages award that is supported
by substantial evidence. Foster v. Dingwall, 126 Nev. __, _, 227

P.3d_ 1042, 1045 (2010) (compensatory damages); Bongiovi_v.
Sullivan, 122 Nev. 556, 581, 188 P.3d 433, 451 (2006) (punitive
damages). We will reverse or reduce the amount of an excessive
compensatory damages award that was “given under the influence of
passion or prejudice” and when it shocks our conscience. Bongiovi,
122 Nev. at 577, 138 P.3d at 448; Hernandez v. City of Salt Lake, 100
Nev. 504, 508, 686 P.2d 251, 253 (1984). When considering a
damages award, we presume that the jury believed the evidence

34

 
offered by the prevailing party and any inferences derived from the
evidence. Countrywide Home Loans vy, Thitchener, 124 Nev. 725,
739, 192 P.3d 243, 252 (2008).

Wyeth argues that the compensatory damages awards
are not supported by substantial evidence as respondents presented

little evidence of actual past and future damages, and thus, the

 

awards are excessive as they are disproportionate to the injuries
suffered,

Based on our review of the appellate record, we conclude
that substantial evidence supports the compensatory damages
awards and that the reduced awards are not excessive. A jury is
given wide latitude in awarding special damages. Id, at 737, 192
P.3d at 251. Damages for pain and suffering are peculiarly within
the jury’s province. Stackiewicz v. Nissan Motor Corp,, 100 Nev. 443,
454-55, 686 P.2d 925, 932 (1984),

Respondents all developed a debilitating disease, breast
cancer, as a result of Wyeth's actions, or lack thereof. ‘The evidence
supported the jury's finding that Wyeth was negligent in failing to
conduct appropriate studies on breast cancer and that it concealed
material facts about its products’ safety. The evidence showed that
Wyeth knew in the mid-1970s that certain body organs, such as

breast tissue, responded negatively to hormones. Yet Wyeth failed to
conduct or participate in any meaningful study of the estrogen-
progestin drug combination until it gave its drug to the WHI study in
1992. Wyeth knew also, by the late 1970s, that physicians were

 

 
commonly prescribing the drug combination to treat menopause and
prevent osteoporosis, And when published medical studies linked
estrogen-progestin hormone therapy to an increased breast cancer
risk, Wyeth sought to downplay the studies’ results and divert
attention from the information.

Experts testified that respondents were hormone

deficient, yet

 

trogen and progestin receptors were present in their
tumors. Because of the hormone receptors in respondents’ tumors,
the fact that respondents’ were hormone deficient, and the fact that
they were taking hormone therapy drugs, respondents’ experts
concluded that the drugs caused their cancers.

Respondents testified that their cancer diagnoses had a
devastating impact on them and their families, Two of the women
underwent a mastectomy and one a lumpectomy; all underwent the
removal of lymph nodes to detect if their cancer had spread.
Respondent Rowatt’s hospital stay was longer due to her preexisting
heart condition, as she had to be removed from her blood thinning
medication before she could go into surgery and had to be put back
on the medication after the surgery.

After their surgeries, respondents suffered through
various aftereffects. Because of the fluid collection in their body,
each respondent had to wear breast drains for several weeks. The
removal of their lymph nodes caused numbness in their arms;
respondent Rowatt’s numbness is permanent and she has a hole
under her arm where the lymph nodes were removed. The surgeries
left scarring, which respondent Scofield testified is a daily reminder

of her cancer. Two of the respondents underwent chemotherapy and

 

 
one

 

one radiation. Each respondent was also prescribed medication to
prevent the recurrence of the cancer. Respondent Forrester
experienced a painful side effect from the medicine, which prevented
her from functioning normally; she had to discontinue the
medication.

While respondents were given good prognoses following
their treatments, expert testimony suggested that there is always a
chance that the cancer may return, even 20 years later. They each
testified that while they have been

 

remission, they persistently
worry and fear that the cancer will return, Respondent Rowatt and
her husband testified that she tries to lead a normal life, but finds
herself doing all that she can because she is not sure of what her
future holds, Respondent Scofield testified that her cancer ii
shadow that knows she is afraid of it and that follows her

 

ke a

everywhere. Testimony was presented that respondents’ future
medical treatment involved regular blood tests and mammograms.
Based on the evidence presented to the jury, we conclude
that the compensatory damages awards after remittitur are not
excessive because they are supported by substantial evidence and the
awards do not shock our conscience.!° Bongiovi, 122 Nev. at 577, 138

‘Wyeth attempts to argue that the damages awards are
‘excessive as compared to damages awards rendered in similar cases.
Any such consideration would be an abuse of discretion. See Wells,
Inc. v. Shoemake, 64 Nev. 57, 74, 177 P.2d 461, 460 (1947). Thus, we
reject this argument on appeal.

37

 
P.8d at 448; Hernandez, 100 Nev. at 508, 686 P.2d at 253; see
generally Deloughery v, City of Chicago, 422 F.3d 611, 616-17, 619
(7th Cir, 2005) (recognizing that when the defendant's motion for
remittitur is granted and the plaintiff accepts the remittitur, the
defendant may still challenge the amount of the remittitur as
excessive). ‘Thus, because the reduced compensatory damages
awards are not excessive, we conclude that the district court did not
abuse its discretion in denying Wyeth’s motion for a new trial.
Nelson v, Heer, 123 Nev. 217, 223, 163 P.3d 420, 424-25 (2007)
(providing that a district court’s decision regarding a new trial

motion is reviewed for an abuse of discretion).!!

We reject Wyeth's contention that the jury's compensatory
damages verdict was further tainted by passion and prejudice
because the jury improperly considered potential harm to nonparties
based on respondents’ closing arguments. In particular, respondents
in closing stated that Wyeth's drugs caused a sufficient number of
deaths or injuries to fill two football stadiums and that the decrease
in breast cancer rates was attributable to the drop in estrogen-
progestin prescriptions after the WHI study was released. To
determine whether a defendant's conduct is so reprehensible as to
warrant the imposition of punitive damages, a jury may consider
evidence of actual harm to nonparties, as that may show that the
defendants’ conduct, which harmed the plaintiffs, may also present a
substantial risk to the general public. See Phillip Morris USA v.
Williams, 549 U.S. 346, 355 (2007). Further, Wyeth’s argument that
the district court improperly refused to prohibit respondents’ counsel
from reading the “Race for the Cure” poem to the jury in closing
arguments lacks merit. To the extent that the complained-of closing
arguments inflamed the jury’s passion and prejudice against Wyeth,
we conclude that the district court properly reduced the respondents!
compensatory damages award in light of the conflicting evidence
presented, as previously discussed.

 

 
oH

 

Punitive de
‘Substantial evidence supports the jury's finding of
malice

Wyeth argues that its explicit and detailed warnings
about breast cancer risk associated with its products accurately
reflected then-existing science and disclosed the limits of that
knowledge. Wyeth argues that malice could not exist because its
drugs are safe and to this day, Prempro and Premarin remain FDA-
approved and continue to be prescribed. Respondents contend that
Wyeth's warning labels were inadequate because they gave false
assurances.

A plaintiff may recover punitive damages when evidence
demonstrates that the defendant has acted with “malice, express or
implied.” NRS 42.005(1). “Malice, express or implied,’ means
conduct which is intended to injure a person or despicable conduct
which is engaged in with a conscious disregard of the rights or safety
of others.” NRS 42.001(3). A defendant has a “[cJonscious disregard”
of a person's rights and safety when he or she knows of “the probable
harmful consequences of a wrongful act and a willful and deliberate
failure to act to avoid those consequences.” NRS 42.001(1). In other
words, under NRS 42,001(1), to justify punitive damages, the
defendant's conduct must have exceeded “mere recklessness or gross
negligence.” Thitchener, 124 Ney. at 742-43, 192 P.8d at 254-55.

‘The evidence shows that while the words “breast cancer”
appear ten times in the Prempro label, in many instances the term
appeared in reassuring statements. For instance, the warning stated
that the relationship between progestin and breast cancer is

unknown, that the majority of studies show no increase in breast

 

39

 
cancer risk, and that the rate of breast cancer that showed up in
Wyeth's human study did “not exceed that expected in the general
population.” To the contrary, the evidence showed that before
Prempro was marketed, there was scientific data that confirmed an
increased risk in breast cancer with the prolonged use of estrogen
plus progestin. Respondents also presented evidence that Wyeth
never conducted a human study. Testimony showed that Wyeth

spent $200 million each year marketing these drugs, but did not

 

perform sufficient drug testing regarding breast cancer and its
products to determine whether they were safe to use.

Evidence further demonstrated that Wyeth financed and
manipulated scientific studies and sponsored articles that
deliberately minimized the risk of breast cancer while promoting
other unproven benefits. It also implemented a policy to dismiss
scientific studies that showed any link between breast cancer and
hormone therapy drugs and to distract the public and medical
professionals from the information as well.

Over the years, Wyeth organized task forces to contain
any negative publicity about hormone therapy and breast cancer.
Wyeth’s strategy to undermine scientific studies linking an increased
risk of breast cancer to estrogen-progestin hormone therapy included
ghostwriting multiple articles. The evidence further showed that
Wyeth worked to keep a European study that exposed the unusually
high breast cancer risk for thin women confidential. As a result of
the study, Wyeth updated its European warnings, but never updated
its United States labels. As respondent Scofield is a thin woman,

this additional warning would have applied to her. The Prempro

 

 
Low, which is available to consumers today, carries the strongest
warning possible, and its use is suggested only as a second-line
treatment for a short duration,

Based on the warning’s language and Wyeth’s actions,
we conclude that a jury could reasonably determine that while
Wyeth warned of breast cancer, it also tried to hide any potential
harmful consequences of its products. ‘Thus, substantial evidence
supports the jury’s conclusion that Wyeth acted with malice when it
had knowledge of the probable harmful consequences of its wrongful
acts and willfully and deliberately failed to act to avoid those
consequences such that punitive damages were warranted."

‘The punitive damages awards are not excessive

Wyeth alternatively contends that the awards should be
reversed because its due process rights have been violated, as the
awards are purportedly excessive, Respondents disagree.

Whether a punitive damages award violates a
defendant's due process rights is subject to de novo review. Bongiovi
¥. Sullivan, 122 Nev. 656, 582-83, 138 P.3d 438, 451-52 (2006).
Awards of punitive damages are generally limited by procedural and
substantive due process concerns. State Farm Mut, Automobile Ins,
Co. v. Campbell, 538 U.S. 408, 416-17 (2003). The Fourteenth
Amendment's Due Process Clause prohibits punitive damages
Id; Bongiovi, 122

awards that are grossly excessive or arbitrary.

 

 

"Because we conclude that the finding of malice was
supported by substantial evidence, we do not need to consider
whether the finding of fraud was also supported.

 

 
4

 

Nev, at 582, 138 P.3d at 451. When reviewing punitive damages
award: “@) the degree of
reprehensibility of the defendant's conduct, (2) the ratio of the

we consider three guidepo:

   

Punitive damages award to the actual harm inflicted on the plaintiff,
and (8) how the punitive damages award compares to other civil or
criminal penalties that could be imposed for comparable misconduct.”
Bongiovi, 122 Nev. at 682, 198 P.3d at 451-52 (internal quotations
and citations omitted).

As to the reprehensibility of Wyeth’s conduct, the harm
caused in this case was physical—breast cancer and its resulting
surgeries and treatment. Wyeth’s misrepresentations and
concealment of data showed reckless disregard for the health and
safety of the users of its drugs. Its conduct involved repeated actions
in that the evidence supported many examples of it misrepresenting
the risks and benefits of its products. The harm suffered by
respondents was the result of Wyeth's malicious activities and deceit.

Regarding the ratio of the punitive damages awarded to
‘the compensatory damages awards, the remitted punitive damages
awards here are less than three times the compensatory awards
‘This is well within the accepted ratios. See NRS 42,005(I)(a).

As to how the punitive damages awards compare to other
civil penalties that could be imposed for comparable misconduct,
Wyeth notes that the most pertinent Nevada civil sanction for
engaging in deceptive trade practices is $5,000. Respondents’
regulatory expert testified, however, that fines can be imposed
against a manufacturer for marketing unproven benefits. She
testified that a recent comparable fine for a company that promoted

42

 
om a

 

its drug for unapproved benefits was $600 million. We reject Wyeth's
arguments and conclude that the reduced punitive damages awards
are well within NRS 42,005's statutory parameters. The awards are
both reasonable and proportionate to the amount of harm caused to
respondents and to the compensatory damages award. ‘Thus, the
remitted punitive damages awards do not violate Wyeth’s due
process rights.

Because the punitive damages awards do not violate
Wyeth’s due process rights, we now consider whether reversal is
nevertheless warranted because of the improper jury deliberations.

The jury’s improper deliberations were cured

Finally, Wyeth challenges the punitive damages awards
based on a purported procedural due process violation. Wyeth
argues that the jury's verdict should be reversed and remanded to
the district court for further proceedings because the jury improperly
deliberated and awarded punitive damages without receiving proper
instructions. Respondents argue that while the jury improperly
considered punitive damages, the problem was corrected when the
district court required the jury to deliberate the compensatory
damages a second time.

During the settling of the jury instructions, the district
court informed the parties that it was going to instruct the jury that,
should it find that malice or fraud existed, a second proceeding would
take place. Respondents objected, as it would have a prejudicial
effect on the jury if it knew that it would have to return for another
proceeding. Thus, respondents urged the district court to remove the

43,

 
instruction, and Wyeth did not object." The jury was given an
instruction regarding whether Wyeth acted with malice or fraud.
‘The jury was not instructed to deliberate and consider awarding any
punitive damages

By statute, Nevada requires that the liability
determination for punitive damages against a defendant be
bifurcated from the assessment of the amount of punitive damages, if
any, to be awarded, NRS 42.005(9); see generally Smith's Food &
Drug Cntrs.v, Bellegarde, 114 Nev. 602, 606, 958 P.2d 1208, 1211
(1998), overruled on other grounds by Countrywide Home Loans v,
Thitchener, 124 Nev. 725, 192 P.8d 243 (2008). This court ha:
recognized a strong public policy in favor of the district court
correcting verdicts before discharging a jury. See Lehrer McGovern
Bovis v. Bullock Insulation, 124 Nev, 1102, 1111, 197 P.3d 1032,
1038 (2008); Eberhard Mfg. Co. v, Baldwin, 97 Nev. 271, 273, 628
P.2d 681, 682 (1981). “The efficient administration of justice
requires that any doubts concerning a verdict’s consistency with
Nevada law be addressed before the court dismisses the jury.”
Cramer v, Peavy, 116 Nev. 575, 582, 8 P.8d 665, 670 (2000). A jury's
verdict should be salvaged, when possible, to avoid a new trial. Id, at
583, 3 P.3d at 670.

48We need not consider Wyeth's argument that a new trial is
warranted when the district court failed to instruct the jury that
there would be two phases of trial because the issue was not
preserved for appellate review. See Diamond Enters., Inc. v, Lau,
113 Nev. 1376, 1378, 951 P.2d 73, 74 (1997),

 

 
a

 

Here, the district court properly bifurcated the
underlying proceedings. The jury was instructed on liability and
compensatory damages, and asked to determine if Wyeth could be
held liable for punitive damages. Neither the instructions nor the
verdict form requested that the jury award an amount for punitive
damages, even if it found that Wyeth acted with malice or fraud.
When the district court learned that the jury awarded punitive
damages in the trial’s first phase, the court reinstructed the jury and
sent them back to deliberate compensatory damages a second time.
‘The district court properly attempted to salvage the jury's verdict 80
as to avoid a new trial

The district court later recognized, however, that the
premature jury deliberations on punitive damages had significantly
tainted the jury's verdicts as being the result of passion and
prejudice, This is evident from the fact that in the first initial
deliberations, the jury returned verdicts totaling $134.5 million,
which improperly included an award for punitive damages. After
being reinstructed on compensatory damages, the jury returned
three verdicts totaling $35.1 million. Thereafter, the jury awarded
punitive damages that totaled $99 million. Combined, the two
awards amount to $134.1 million, only $500,000 less than their
original award. Because the awards were still tainted by the jury's
passion and prejudice, the district court granted Wyeth's motion to
reduce the awards. The district court reduced the jury’s punitive

45

 
damage verdict from $35 to $13 million for Ms. Forrester, from $31 to
$10 million for Ms, Rowatt, and from $33 to $12 million for Ms,
Scofield.

‘Thus, while the jury's improper deliberations may not
have been

 

Ivaged in light of the subsequent punitive damages
awards, the verdicts were spared when the district court granted the
remittitur and reduced the awards. Therefore, the district court did
not abuse its discretion in reinstructing the jury and then denying
Wyeth’s new trial motion because it salvaged the verdicts by
granting the remittitur. See Lehrer, 124 Nev. at 1110, 197 P.3d at
1037-38 (reviewing a district court's decision regarding a jury verdict
for an abuse of discretion).

Wyeth also argues that the district court erroneously granted
attorney fees to respondents pursuant to NRS 17.115 and NRCP 68
because it rested on an error about prior verdicts and a conclusory
assertion that Wyeth had acted in bad faith, without the evaluation
of the factors required in Beattie v. Thomas, 99 Nev. 579, 588-89,
668 P.2d 268, 274 (1983). The record reflects, however, that the
district court properly considered the Beattie factors, and thus, no
abuse of discretion occurred. See Wynn v. Smith, 117 Nev. 6, 13, 16
P.3d 424, 428.29 (2001) (reviewing an award of attorney fees under
NRS 17.115 and NRCP 68 for an abuse of discretion); Yamaha Motor
Co. v, Arnoult, 114 Nev. 233, 252 n.16, 955 P.2d 661, 678 n. 16 (1998)
(providing that no one Beattie factor is determinative).

 

 
CONCLUSION

‘The district court did not err or abuse its discretion in

denying Wyeth’s motions for judgment as a matter of law or its

 

motion for a new trial, and therefore, we affirm the district court on

Chea s

Cherry

 

all issues presented.