Filed 1/9/24

CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION FOUR

GILEAD TENOFOVIR CASES.

GILEAD LIFE SCIENCES, 

INC.,

Petitioner,

v.

THE SUPERIOR COURT OF 

THE CITY AND COUNTY OF 

SAN FRANCISCO,

Respondent;

PLAINTIFFS IN JCCP NO. 

5043,

Real Parties in Interest.

 A165558

 (San Francisco City &

 County Super. Ct. 

 No. CJC-19-005043,

 JCCP No. 5043)

Defendant Gilead Life Sciences, Inc. (Gilead), a 

pharmaceutical manufacturer, developed and sold one of the first 

medications to treat HIV/AIDS. That drug, tenofovir disoproxil 

fumarate (TDF), was approved for sale by the Food and Drug 

Administration (FDA) in 2001. Although TDF was effective in 

suppressing the effects of HIV, its use carried a risk of skeletal 

and kidney damage. The 24,000 plaintiffs in this coordinated 
2

proceeding allege that they suffered these or other adverse effects 

from their use of TDF. 

While Gilead was developing TDF, it discovered a similar, 

but chemically distinct, potential drug, tenofovir alafenamide 

fumarate (TAF). Plaintiffs allege that Gilead’s early testing 

indicated TAF could be as effective as TDF at treating HIV/AIDS, 

while carrying a lower risk of adverse effects. According to 

plaintiffs, however, Gilead elected to defer development of TAF 

because it was concerned that the immediate development of TAF 

would reduce its financial return from TDF. Years later, Gilead 

resumed the development of TAF and obtained FDA approval for 

its sale in 2015.

Although plaintiffs are seeking compensation for injuries 

caused by their use of TDF, they do not assert any claim seeking 

to prove that TDF is defective. Instead, they characterize their 

claim as one for ordinary negligence, contending that Gilead’s 

decision to defer development of TAF to maximize its profits 

breached its duty of reasonable care to users of TDF. They also 

assert a claim for fraudulent concealment, reasoning that Gilead 

had a duty to disclose information about TAF to users of TDF. 

Gilead filed a motion for summary judgment or summary 

adjudication. With respect to plaintiffs’ claim for negligence, 

Gilead argued that a plaintiff seeking to recover for harm caused 

by a manufactured product must prove that the product was 

defective. Given plaintiffs’ decision not to prove a defect, Gilead 

contended, they cannot recover for harm caused by their use of 

TDF. With respect to fraudulent concealment, Gilead argued
3

that it had no duty to disclose facts relating to TAF when it had 

not been approved as an alternative to TDF for the treatment of 

HIV/AIDS. The trial court denied the motion in its entirety. 

Gilead then filed a writ petition in this court. Because of the 

potentially dispositive nature of these issues for this large 

coordinated proceeding, we issued an order to show cause. After 

oral argument, we requested supplemental briefing on certain 

issues raised by plaintiffs’ negligence claim, including whether, if 

the law does not require proof of a defect, the factors set forth in 

Rowland v. Christian (1968) 69 Cal.2d 108 (Rowland)

nonetheless warrant an exception to the duty of care in this 

context.

We now grant the petition for writ of mandate in part and 

deny it in part. We affirm the trial court’s denial of Gilead’s 

motion insofar as it sought summary adjudication of plaintiffs’ 

negligence claim. First, we conclude that the legal duty of a 

manufacturer to exercise reasonable care can, in appropriate 

circumstances, extend beyond the duty not to market a defective 

product. Second, in light of that conclusion, we then explain why 

Rowland supplies the appropriate framework for evaluating 

plaintiffs’ negligence claim. Third, applying Rowland, we 

consider two proposed exceptions to the duty of care. The first 

exception mirrors Gilead’s original argument by precluding 

negligence liability for prescription drugs without proof of a 

defect. The second exception is narrower in that it would allow 

plaintiffs to assert a claim for negligence without proof of a 

defect, but only as to decisions the drug manufacturer made after 
4

obtaining the results of Phase III clinical trials of the alternative 

drug. We find that the broader proposed exception is 

unwarranted, and that the narrower exception is unsupported on 

the present record, although we do not preclude the possibility 

that Gilead could establish it on a more developed record.

Finally, we reverse the trial court’s decision insofar as it 

denied Gilead’s motion for summary adjudication of plaintiffs’ 

claim for fraudulent concealment. We conclude that Gilead’s 

duty to plaintiffs did not extend to the disclosure of information 

about TAF. 

BACKGROUND

I. Plaintiffs’ Allegations 

Plaintiffs allege that in 1991 Gilead obtained an exclusive 

license to develop tenofovir, a substance known to be “an 

incredibly potent antiretroviral,” as a treatment for HIV/AIDS. 

Tenofovir could not be used as a medication in its pure form, 

however, because it is not effective when administered orally and 

produces “rapid and severe decline in kidney function” when 

injected directly into the body. To create a usable medication 

from tenofovir, Gilead was required to develop an alternative 

form of the chemical, known generally as a “prodrug,” that would 

be safe and effective when administered orally. 

Gilead eventually created TDF, a prodrug form of tenofovir, 

and focused its development efforts on that compound. TDF was 

approved by the FDA for sale as a treatment for HIV/AIDS 

in 2001. It was recognized at the time, however, that use of TDF 

carried the potential for harmful side effects.
5

At some point during its work, Gilead developed a second 

prodrug form of tenofovir, TAF, that also showed promise in the 

treatment of HIV/AIDS. Plaintiffs allege that TAF is more stable 

in the body than TDF, a property that permits TAF to be 

administered at a lower dose than TDF. The use of a smaller 

dose allegedly makes TAF more effective as a treatment while 

reducing adverse side effects. 

Plaintiffs allege that even before Gilead obtained 

regulatory approval to market TDF in 2001, the company “knew 

[TAF] to be more efficacious and less toxic to kidneys and bones 

than TDF.” In 2002, Gilead undertook Phase I/II testing of TAF. 

According to the complaint, apparently quoting a Gilead 

document, this testing was done with the “explicit goal of ‘. . . 

deliver[ing] a more potent version of tenofovir that can be taken 

in lower doses, resulting in better antiviral activity and fewer 

side effects.’ ” In 2004, however, Gilead discontinued 

development of TAF. At the time, Gilead allegedly explained its 

decision by stating publicly that the differences between TDF and 

TAF were insufficient to justify further investment in TAF’s 

development. 

Plaintiffs allege, on the contrary, that Gilead’s decision to 

discontinue work on TAF was actually driven by a conscious 

business strategy to maximize the financial value of TDF. If TAF 

were developed immediately as a treatment, plaintiffs allege, its 

superiority to TDF would have resulted in its replacement of TDF 

as an HIV/AIDS treatment. By deferring development of TAF, in 

contrast, Gilead was able to maximize its sales of TDF, while 
6

using the later release of TAF to extend the patent coverage of 

tenofovir-related medications. As plaintiffs allege, this strategy 

“would effectively monetize both drugs.” 

Following its pause in the development of TAF in 2004, and 

continuing through 2011, Gilead obtained FDA approval to sell a 

series of HIV/AIDS medications that featured TDF in 

combination with antiviral drugs produced by other 

manufacturers. Gilead eventually resumed work on TAF and 

received FDA approval to sell TAF as a treatment for HIV/AIDS 

in 2015. In 2011, Gilead’s President allegedly told investors that 

TAF would be a “kinder, gentler” version of TDF.1

The complaint asserted claims for negligence, strict 

products liability, breach of express and implied warranties, and 

fraudulent concealment. Over the course of the litigation, 

however, plaintiffs significantly narrowed the scope of their 

claims. In two separate stipulations, plaintiffs dismissed with 

prejudice their causes of action for strict liability and breach of 

warranty, as well as any claims “that solely provide support for 

failure to warn liability.” By the time of the summary judgment

motion, plaintiffs’ only remaining claims were for negligence and 

fraudulent concealment.

1 According to the statement of undisputed material facts 

Gilead submitted in connection with the summary judgment 

motion, Gilead resumed work on TAF in 2011 and conducted a 

Phase III study to compare TDF- and TAF-based medications 

in 2013. That study, Gilead’s motion conceded, provided 

“substantial evidence that TAF had less impact than TDF on 

renal function [and] bone metabolism.” 
7

II. Gilead’s Summary Judgment Motion

Although the allegations on which plaintiffs’ negligence 

cause of action is based did not change over the course of the 

litigation, the framing of their claim evolved. By the time Gilead 

filed its summary judgment motion, plaintiffs’ contention was 

that Gilead’s 2004 decision to postpone development of TAF, 

despite its knowledge that TAF presented a safer alternative to 

TDF, breached its duty of reasonable care to users of its TDF 

medications. Plaintiffs aver that they will not attempt to 

demonstrate that TDF’s design was defective, nor that TDF 

should be withdrawn from the market. Rather, what matters is 

that “Plaintiffs and their physicians were deprived of the choice

between TDF or TAF by Gilead’s actions.”

Gilead did not, for purposes of the summary judgment 

motion, dispute plaintiffs’ primary allegations of actionable 

conduct. Rather, its motion was premised solely on evidence of 

the FDA’s approval of a series of medications featuring TDF. 

Based on this approval, Gilead argued that plaintiffs’ claim for 

negligence (1) is preempted by federal law and (2) fails to state a 

claim under state tort law. The latter argument was premised on 

Gilead’s contention that a product seller is liable only for harm 

caused by products proven to be defective. Because plaintiffs do 

not seek to prove that TDF-containing medications are defective, 

Gilead argued, plaintiffs cannot hold the company liable for harm 

caused by TDF. Acknowledging plaintiffs’ current claim that 

Gilead had a duty of reasonable care to commercialize a TAFbased medication once it knew of TAF’s superiority to TDF, 
8

Gilead argued that “there is no such thing as a claim to redress 

alleged injuries caused by a defendant’s product without 

‘prov[ing] that a defect caused [the] injury’—i.e., without proving 

a design defect.” 

Plaintiffs’ claim for fraudulent concealment alleged that 

Gilead actively concealed that TAF was a safer means for 

delivering tenofovir into the body; that the toxicity of tenofovir 

was not unavoidable; and that Gilead’s true motive for shelving 

TAF development was financial. With respect to this claim, 

Gilead argued that (1) it was preempted by federal law; (2) Gilead 

had no duty to disclose to plaintiffs information “about an 

unapproved drug that they were not taking”; and (3) plaintiffs 

could not demonstrate that information about TAF’s safety, 

provided prior to TAF’s approval by the FDA, would have been 

material to their doctors’ decisions to prescribe TDF. As noted, 

the summary judgment motion was denied, and these writ 

proceedings followed.2

DISCUSSION

I. Negligence

Civil Code section 1714 (section 1714), which states the 

statutory rule of negligence, provides that “[e]veryone is 

responsible . . . for an injury occasioned to another by his or her 

2 In connection with its writ petition and again in 

connection with a subsequent motion to stay proceedings, Gilead 

filed separate motions for judicial notice. Although we granted 

the relief sought by Gilead in both instances, we did not expressly 

rule on its motions for judicial notice in doing so. Because both 

motions for judicial notice were rendered moot by our grant of the 

relief Gilead was seeking, we now deny the motions.
9

want of ordinary care or skill in the management of his or her 

property or person.” (Civ. Code, § 1714, subd. (a).) The familiar 

elements of a negligence cause of action are duty, breach, 

causation, and damages. (Achay v. Huntington Beach Union 

High School Dist. (2022) 80 Cal.App.5th 528, 535.) “In 

California, the ‘general rule’ is that people owe a duty of care to 

avoid causing harm to others and that they are thus usually 

liable for injuries their negligence inflicts.” (Southern California 

Gas Leak Cases (2019) 7 Cal.5th 391, 308; see Brown v. USA 

Taekwondo (2021) 11 Cal.5th 204, 214 (USA Taekwondo)

[section 1714 “establishes the default rule that each person has a 

duty ‘to exercise, in his or her activities, reasonable care for the 

safety of others’ ”].) “Whether a duty exists is a question of law to 

be resolved by the court.” (USA Taekwondo, at p. 213.)

Drawing on the language of section 1714, plaintiffs 

characterize Gilead’s duty as simply the duty “to exercise 

reasonable care not to cause foreseeable injury to the users of its 

products.” But it is generally more appropriate to consider the 

claimed duty in its factual context. (See, e.g., Verdugo v. Target 

Corp. (2014) 59 Cal.4th 312, 336 [considering whether duty of 

reasonable care obligates department store to maintain an AED 

for use in a medical emergency]; Conte v. Wyeth, Inc. (2008) 

168 Cal.App.4th 89, 103 (Conte) [considering “whether a namebrand prescription drug manufacturer in disseminating product 

warnings owes a duty of care to patients who take a generic 

version of the drug pursuant to a prescription written in reliance 

on the name-brand maker’s information”].) Doing so is 
10

particularly important here because Gilead occasionally describes 

plaintiffs’ proposed duty as imposing obligations—such as a “duty 

to innovate”—that plaintiffs expressly disavow. Plaintiffs do not 

claim that a manufacturer that obtains FDA approval to sell a 

prescription drug has a legal duty to invent a safer alternative 

drug, and by failing to do so may be held liable to users of the 

existing drug for injuries caused by the disclosed side effects of its 

use.3 On the contrary, their negligence claim is premised on 

Gilead’s possession of such an alternative in TAF; they complain 

of Gilead’s knowing and intentional withholding of such a 

treatment following its invention. While we agree with Gilead 

that a duty that placed manufacturers “under an endless 

obligation to pursue ever-better new products or improvements to 

existing products” would be unworkable and unwarranted, 

plaintiffs are not asking us to recognize such a duty.

The factual basis for plaintiffs’ claim, as alleged in the 

complaint and confirmed by their supplemental briefing, is that 

(1) Gilead voluntarily invented TAF as part of the same research 

effort that led to the development of TDF; (2) prior to pausing 

work on TAF, Gilead had developed TAF sufficiently to evaluate 

its performance in a controlled trial, referred to as a Phase I/II 

trial; (3) by the time it paused work in 2004, Gilead knew that 

3 We use the term “invent” here, rather than “develop,” 

because the meaning of “develop” in the pharmaceutical context 

is ambiguous. Gilead refers to the entire process of drug creation, 

from invention through FDA approval, as drug development. 

Because plaintiffs’ claim is focused only on the latter stages of 

this process, Gilead’s general reference to a “duty to develop” 

obscures the precise nature of plaintiffs’ claim.
11

TAF would treat HIV/AIDS as effectively as TDF, yet would 

allow patients to avoid the bone and kidney side effects 

associated with TDF; and (4) Gilead made the decision to defer 

further commercialization of TAF for the purpose of extending 

the duration of its patent protection for tenofovir-related 

treatments, thereby increasing its financial return, rather than 

because of any concerns for TAF’s successful commercialization. 

Again, while Gilead’s briefing disputes plaintiffs’ assertions about 

its knowledge and motivation, it did not contest those assertions 

for the purposes of the summary judgment motion presently 

under review. We therefore accept the allegations of the 

complaint in adjudicating Gilead’s present arguments.4

In context, then, the duty question we must address is 

whether a drug manufacturer, having invented what it knows is 

a safer, and at least equally effective, alternative to a 

prescription drug that it is currently selling and that is not 

shown to be defective, has a duty of reasonable care to users of 

the current drug when making decisions about the 

commercialization of the alternative drug.5

4 Although Gilead cites some evidence in the appellate 

record to support its rebuttal of plaintiffs’ factual allegations, 

that evidence was submitted in connection with proceedings in 

the litigation that occurred prior to the summary judgment 

motion. Plaintiffs contend that Gilead’s evidence is contradicted 

by evidence similarly submitted by plaintiffs.

5 At a few points in the complaint, plaintiffs allege that 

Gilead knew “or should have known” that TAF was safer than 

TDF. In general, however, plaintiffs’ complaint, summary 

judgment papers, and briefs in this court, assert without 
12

A. Negligence Without Proof of Defect

Gilead’s original argument against plaintiffs’ negligence 

claim in its writ petition was based on plaintiffs’ decision to 

abandon any attempt to prove that TDF is defective. (Plaintiffs 

state that their decision is not a concession that TDF is not

defective, but rather arises from a concern that any claim 

requiring proof that TDF is defective would be subject to federal 

preemption.6) Gilead argued that, in the products liability 

context, a manufacturer satisfies its duty of reasonable care by 

making a product that is not defective. Therefore, according to 

Gilead, a manufacturer cannot be held liable in negligence for 

harm its product causes if the plaintiff’s showing does not include 

proof that the injury was caused by a defect.

The concept of a “defect” is one of the defining components

of the doctrine of strict products liability, which provides that the

manufacturer of a product is liable “if a defect in . . . its product

qualification that Gilead knew TAF was safer than TDF. 

Moreover, actual knowledge appears to be necessary to the 

motivation plaintiffs attribute to Gilead’s decision—Gilead’s 

alleged concern that TAF would “cannibalize” sales of TDF and 

its belief that TAF’s later release would allow Gilead to maximize 

its financial return by extending the duration of its patent 

protection for tenofovir-related treatments. We therefore analyze 

plaintiffs’ claim as premised on actual knowledge, although we 

take no position on whether plaintiffs should be permitted to 

include a constructive knowledge theory on remand, should they 

seek to do so.

6 Plaintiffs contend that the doctrine has developed in such 

a way as to severely limit the availability of design defect claims. 

(See, e.g., Bernstein, (Almost) No Bad Drugs: Near-Total 

Products Liability Immunity for Pharmaceuticals Explained

(2020) 77 Wash. & Lee L.Rev. 3, 32–37 (Bernstein).)
13

causes injury while the product is being used in a reasonably

foreseeable way.” (Soule v. General Motors Corp. (1994) 8 Cal.4th

548, 560 (Soule).)7 Prior to California’s adoption of the doctrine 

in Greenman v. Yuba Power Products, Inc. (1963) 59 Cal.2d 57 

(Greenman), negligence was the primary tort theory under which 

persons could recover for injuries caused by a manufactured 

product. (E.g., Escola v. Coca Cola Bottling Co. (1944) 24 Cal.2d 

453, 457.) Because strict liability “focusses not on the conduct of

the manufacturer but on the product itself” (Brown, supra,

44 Cal.3d at p. 1056), it was intended to simplify a consumer 

plaintiff’s evidentiary burden, as well as to serve the public policy 

function of placing the financial burdens associated with 

defective products on manufacturers, who are liable regardless of 

any fault in their conduct. (See Cronin v. J.B.E. Olson Corp.

7 Product defects fall into three categories: manufacturing

defects, design defects, and defects of warning. A manufacturing

defect occurs from “a flaw in the manufacturing process, resulting

in a product that differs from the manufacturer’s intended 

result.” (Brown v. Superior Court (1988) 44 Cal.3d 1049, 1057

(Brown).) A design defect can be found (1) “if the plaintiff

demonstrates that the product failed to perform as safely as an

ordinary consumer would expect when used in an intended or

reasonably foreseeable manner” (Barker v. Lull Engineering Co.

(1978) 20 Cal.3d 413, 429 (Barker)) or (2) “if the jury finds that

the risk of danger inherent in the challenged design outweighs

the benefits of such design.” (Id. at p. 430; see generally Kim v.

Toyota Motor Corp. (2018) 6 Cal.5th 21, 30.) A failure-to-warn

defect results if the manufacturer “did not adequately warn of a 

particular risk that was known or knowable in light of the 

generally recognized and prevailing best scientific and medical 

knowledge available at the time of manufacture and 

distribution.” (Carlin v. Superior Court (1996) 13 Cal.4th 1104,

1112 (Carlin).)
14

(1972) 8 Cal.3d 121, 133 (Cronin) [“the very purpose of our 

pioneering efforts in this field was to relieve the plaintiff from 

problems of proof inherent in pursuing negligence [citation] and 

warranty [citation] remedies, and thereby ‘to insure that the 

costs of injuries resulting from defective products are borne by 

the manufacturers’ ”].) 

The purpose of requiring proof of a defect is to prevent 

strict liability from expanding into absolute liability, in which 

manufacturers would effectively be made insurers for the safety 

of their products. (See, e.g., Cronin, supra, 8 Cal.3d at pp. 133–

134; Soule, supra, 8 Cal.4th at p. 568, fn. 5; Daly v. General 

Motors Corp. (1978) 20 Cal.3d 725, 733; see also Jiminez v. Sears, 

Roebuck & Co. (1971) 4 Cal.3d 379, 383 (Jiminez) [noting that 

“the manufacturer’s strict liability depends upon what is meant 

by defect”].) Early commentators, including Greenman’s author, 

Justice Traynor, remarked on the difficulty of defining what 

constitutes a “defect.” (See Traynor, The Ways and Meanings of 

Defective Products and Strict Liability (1965) 32 Tenn. L.Rev. 

363, 366–367; Wade, On the Nature of Strict Tort Liability for 

Products (1973) 44 Miss. L.J. 825, 832 [“It is not without reason 

that some people, in writing about it, speak of the requirement of 

being ‘legally defective,’ including the quotation marks”]; see also 

Barker, supra, 20 Cal.3d at p. 427 [“the term defect as utilized in 

the strict liability context is neither self-defining nor susceptible 

to a single definition applicable in all contexts”].) But while the 

“formidable task” (id. at p. 418) of defining the term “defect” may 

have been necessary to constrain the reach of strict liability, in 
15

negligence the requirement of a duty of care imposes its own 

limits on the potential scope of liability, governed by an array of 

policy considerations as they bear on a particular context. (See, 

e.g., Kesner v. Superior Court (2016) 1 Cal.5th 1132, 1143

(Kesner) [“ ‘ “Courts . . . invoke[] the concept of duty to limit 

generally ‘the otherwise potentially infinite liability which would 

follow from every negligent act. . . .’ ” ’ ”] (quoting Bily v. Arthur 

Young & Co. (1992) 3 Cal.4th 370, 397); Rowland, supra, 

69 Cal.2d at pp. 112–113.) In our view, neither logic nor 

jurisprudential history compels the conclusion that the two 

concepts must be coextensive in every case in which a plaintiff is 

injured by a product.

The adoption of strict liability in Greenman did not purport 

to displace negligence as a cause of action. It was soon settled 

that a plaintiff seeking compensation for harm caused by a 

product can plead and prove a claim for negligence as well as 

strict liability. (E.g., Jiminez, supra, 4 Cal.3d at p. 387 [“No valid 

reason appears to require a plaintiff to elect whether to proceed 

on the theory of strict liability in tort or on the theory of 

negligence”]; T.H. v. Novartis Pharmaceuticals Corp. (2017) 

4 Cal.5th 145, 177, fn. 4 (T.H.) [affirming that strict liability and 

negligence furnish distinct bases for liability].) After Greenman, 

plaintiffs harmed by products can focus on the product and prove 

a defect, or they can focus on the manufacturer’s conduct and 

prove a breach of the duty of care—or both. In theory, there is no 

reason why a plaintiff who suffers harm as a proximate result of 

a manufacturer’s breach of the duty of reasonable care should be 
16

denied relief merely because the product that was the direct 

cause of harm did not satisfy the legal definition of “defective.”

That said, Gilead’s argument that proof of a defect is a 

necessary element of a negligence claim for injury from a product 

is not new to the law. The same argument was made, although 

not resolved, early in the development of strict liability law in 

Hasson v. Ford Motor Co. (1977) 19 Cal.3d 530 (Hasson). The 

plaintiff there was injured when the brakes failed on his fouryear-old car. (Id. at p. 536.) The jury concluded that the car was 

not defective at the time it was sold, but it found the 

manufacturer liable in negligence. (Id. at p. 539.) The 

manufacturer argued that the jury’s verdict was fatally 

inconsistent because “strict liability based upon a ‘defect’ of 

design or manufacture encompasses all of the conceptual bases 

which would give rise to a traditional common law liability for 

negligence of a manufacturer. In effect, the newer law subsumes 

the old. Accordingly, . . . a special finding that there was no 

‘defect’ obviates any finding of ‘negligence.’ ” (Id. at p. 540.) 

Unfortunately for our present purposes, the Supreme Court 

declined to “examine in detail the abstract legal relationship 

between the terms ‘defect’ and ‘negligence’ ” and did not render a 

ruling on the manufacturer’s argument. (Ibid.)8 Since Hasson, 

8 Hasson did conclude that the jury’s finding of no defect at 

the time the car was manufactured did not preclude a finding of 

negligence liability, but it did so by construing the negligence 

claim in a way that did not involve design. The court reasoned 

that, in light of the instructions given, the jury could have 

concluded “that the braking system and the fluid were, at the 
17

no California case appears to have expressly considered the issue 

before us.9 Nonetheless, a variety of cases demonstrate, contrary 

to Gilead’s argument, that a manufacturer’s duty of reasonable 

care can extend more broadly than the duty to make a nondefective product, thereby permitting recovery even when there is 

no showing that the injury resulted from a product defect.

outset, sound and fit for their intended purpose,” giving rise to 

the finding of no defect, “but that Ford was nonetheless liable for 

its failure during the ensuing four years to warn of conditions 

which might develop in use.” (Hasson, supra, 19 Cal.3d at 

p. 543.) The court pointed out that, while the instructions 

permitted the jury to construe Ford’s failure to warn as a product 

defect, they did not require it to do so, and thus the failure to 

warn could have been the predicate for the jury’s negligence 

finding without also leading to a finding of defect. (Ibid.)

9 In Toner v. Lederle Laboratories (9th Cir. 1987) 828 F.2d 

510, 513 (Toner), the Ninth Circuit held, based on the Idaho 

Supreme Court’s answers to certified questions (see Toner v. 

Lederle Laboratories (1987) 112 Idaho 328, 330), that under 

Idaho law the jury’s verdict absolving the vaccine manufacturer 

under strict liability was not fatally inconsistent with its verdict 

finding it liable in negligence. The court concluded that the jury 

could have found that the vaccine that harmed the plaintiff was 

not defective, while also finding the manufacturer negligent for 

failing to develop an alternative, safer vaccine of which it was 

aware. (Toner, 828 F.2d at p. 513; but see, e.g., Burton v. E.I. du 

Pont de Nemours and Co., Inc. (7th Cir. 2021) 994 F.3d 791, 817–

819 [concluding that, under Wisconsin law, a negligence claim 

requires proof of a defect].) In a federal case arising out of the 

same facts at issue here, the court recently “reject[ed] Gilead’s 

argument to the extent it asserts it cannot be held liable for 

negligence if it is not liable under a strict-liability theory,” but

the question there was whether certain states require a plaintiff 

asserting a negligence claim to prove that the product was 

“unreasonably dangerous.” (Holley v. Gilead Sciences, Inc.

(N.D.Cal. Sept. 28, 2023, No. 18-cv-06972-JST) 2023 U.S. 

Dist.Lexis 176115, at *61–*62.)
18

The most prominent such case is Mexicali Rose v. Superior 

Court (1992) 1 Cal.4th 617 (Mexicali Rose), which considered 

whether restaurants can be held liable for injury caused by a 

naturally occurring substance in their food—there, a chicken 

bone in a chicken enchilada. (Id. at p. 620.) In its analysis, the 

Supreme Court first summarized the prevailing rule: “If the 

injury-producing substance is natural to the preparation of the 

food served, it can be said that it was reasonably expected by its 

very nature and the food cannot be determined to be unfit for 

human consumption or defective.” (Id. at p. 630.) “Thus,” the 

court concluded, “a plaintiff in such a case has no cause of action 

in implied warranty or strict liability.” (Id. at pp. 630–631.)

The inability to prove a defect, however, was not fatal to a 

plaintiff’ s recovery for injury caused by a naturally occurring 

substance. Plaintiffs may still, the court held, assert a claim for 

negligence and prove that the presence of the substance resulted 

from the restaurant’s failure to exercise ordinary care in 

preparation of the non-defective dish. As the court confirmed, 

“[t]he expectations of the consumer do not, however, negate a 

defendant’s duty to exercise reasonable care in the preparation 

and service of the food. Therefore, if the presence of the natural 

substance is due to a defendant’s failure to exercise due care in 

the preparation of the food, an injured plaintiff may state a cause 

of action in negligence.” (Mexicali Rose, supra, 1 Cal.4th at

p. 631.) 

Mexicali Rose expressly rejected the argument that a 

restaurant’s liability should be limited to food classified as 
19

defective under the law of strict liability, thereby barring any 

claim for recovery “when a substance natural to the preparation 

of the food product has caused injury.” (Mexicali Rose, supra,

1 Cal.4th at p. 632.) The court reasoned that allowing a cause of 

action for negligence “corresponds to modern developments in 

tort law,” including “our modern emphasis on Civil Code 

section 1714.” (Ibid.) “[W]e believe it is a question for the trier of 

fact to determine whether the presence of the injury-producing 

substance was caused by the failure of the defendants to exercise 

reasonable care in the preparation of the food, and whether the 

breach of the duty to exercise such care caused the consumer’s 

injury.” (Id. at p. 633.)

Although Mexicali Rose did not expressly consider the issue 

raised by Gilead—the need to prove a defect to recover for harm 

caused by a product—its holding effectively resolves the claim. 

Mexicali Rose holds that a plaintiff may recover under the 

doctrine of negligence for harm caused by a product otherwise 

subject to the doctrine of strict liability, notwithstanding the 

plaintiff’s inability to prove a product defect. And although the 

decision arose in the atypical context of restaurant “products,” it

does not suggest that its ruling is limited to that context, and 

Gilead, when asked to address the decision at oral argument, 

provided no justification for restricting the decision to food 

products. Importantly, Mexicali Rose illustrates the continued 

utility of the negligence cause of action in products liability 

actions. Although the legal concept of a “defect” is 

extraordinarily useful, it should not in every case constitute the 
20

outer boundary of a manufacturer’s liability for its conduct. The 

circumstances under which a manufacturer might appropriately 

be held liable for injury caused by its products are simply too 

varied to be so constrained. Under section 1714, harm resulting 

from a manufacturer’s failure to exercise reasonable care may be 

compensable, even if the product causing the harm does not meet 

the legal definition of “defective.”

The Courts of Appeal have also permitted recovery under 

claims of negligence in the absence of a defect. (See, e.g., Lunghi

v. Clark Equipment Co. (1984) 153 Cal.App.3d 485 (Lunghi);

Hernandez v. Badger Construction Equipment Co. (1994) 

28 Cal.App.4th 1791 (Hernandez).) The plaintiff’s decedent in 

Lunghi was killed by a machine manufactured several years

earlier. The jury entered judgment for the defendant, finding no

defect in the product’s design. (Lunghi, at p. 489.) The Court of

Appeal reversed, concluding the trial court had erred in refusing

to instruct on negligence. (Id. at p. 491.) As the court explained,

“[e]ven if, properly instructed, the jury had found that none of the 

mechanical design features in issue . . . constituted a defect, it 

could still have found that [the defendant’s] knowledge of the 

injuries caused by these features imposed a duty to warn of the 

danger, and/or a duty to conduct an adequate retrofit campaign. 

A finding that [defendant] had not met the standard of

reasonable care with regard to either of these duties would have

had some support in the evidence, and would have been

consistent with a finding that the product’s design was not

defective.” (Id. at p. 494, italics omitted.) To similar effect is
21

Hernandez, which also involved an injury from heavy equipment

manufactured several years prior. Although the jury found 

against the plaintiff on the issue of design defect (Hernandez, at 

p. 1802), the court affirmed a verdict of negligence on the theory 

that the manufacturer, once it began offering as standard 

equipment a safety device that would have prevented the 

plaintiff’s injury, could be found liable under a duty to take 

reasonable steps to prevent injury to users of earlier models 

lacking the device. (Id. at p. 1828.)

Gilead argues that Hernandez and Lunghi are inapposite 

because, in its view, they stand only for the proposition that a 

product can be free of defects at the time it is manufactured and 

sold, but can “become defective,” for example as a result of 

technological developments or new information or understanding. 

Neither case, however, held that the products had become 

“defective” as that term is used in strict products liability law, 

nor characterized such a finding as a prerequisite to imposing a 

duty to warn or to retrofit under principles of negligence. 

Whether or not the products could have been characterized as 

“defective” at the time of the plaintiffs’ injuries, the plaintiffs did 

not have to prove that they were, and the characterization is 

legally irrelevant to a finding of negligence liability.

In short, although the utility of a cause of action for

negligence in products liability actions has been greatly reduced

by the doctrine of strict liability, it has not been eliminated. In

those circumstances in which a manufacturer’s duty of

reasonable care properly extends beyond the duty not to market a
22

defective product, a claim for negligence continues to provide a

remedy.

We are not persuaded by Gilead’s arguments to the 

contrary. Gilead relies on isolated language from a variety of 

decisions that characterize products liability law as premised on 

the existence of a defect. Because the doctrine of strict liability 

provides the rule of law for the vast majority of products liability 

cases, this is an understandable generalization. As the Supreme 

Court has had frequent reason to observe, however, “ ‘ “ ‘cases are

not authority for propositions not considered.’ ” ’ ” (Geiser v. 

Kuhns (2022) 13 Cal.5th 1238, 1252.) The mere fact that a 

decision contains language that can be construed to suggest that 

a defect is a sine qua non for recovery against a manufacturer 

does not make the decision authority for that proposition unless

the issue has been considered and the conclusion embraced. (Id. 

at p. 1252 [the cited case “is not controlling because that issue 

was not presented in [the case]”].)

Merrill v. Navegar, Inc.

Gilead places primary reliance on Merrill v. Navegar, Inc.

(2001) 26 Cal.4th 465 (Merrill), which considered the connection 

between claims of negligent and defective design in construing 

former Civil Code section 1714.4. That statute, repealed in 2002 

(Stats. 2002, ch. 906, § 2), prohibited recovery against gun 

manufacturers on a classic risk/benefit theory of design defect.10 

10 Former Civil Code section 1714.4, subdivision (a), read: 

“In a products liability action, no firearm or ammunition shall be 

deemed defective in design on the basis that the benefits of the 
23

(Merrill, at p. 470.) The plaintiffs attempted to avoid the bar of 

former section 1714.4 by alleging that semi-automatic assault 

pistols were negligently designed “because, given their particular 

characteristics, the benefits of making them available to the 

general public—which were nonexistent—did not outweigh the 

risk they might inflict serious injury or death when discharged.” 

(Ibid.)

In rejecting the attempt, the court recognized that a 

plaintiff in a products liability action can recover under theories 

of both strict liability and negligence. (Id. at p. 478.) In a 

products liability action based on negligence in the design of a 

product, however, “the test of negligent design ‘involves a 

balancing of the likelihood of harm to be expected from a machine 

with a given design and the gravity of harm if it happens against 

the burden of the precaution which would be effective to avoid the 

harm.’ ” (Id. at p. 479.) “Thus,” the court observed, “ ‘most of the 

evidentiary matters’ relevant to applying the risk/benefit test in 

strict liability cases ‘are similar to the issues typically presented 

in a negligent design case.’ ” (Id. at p. 480.) Although the 

plaintiffs argued “that they seek to hold [the defendant] liable for 

‘negligent conduct, not for making a defective product,’ ” the court 

found the distinction immaterial because “in asserting that the 

[assault pistol] had a ‘negligent design’ and that [the defendant]

‘negligently designed’ it, plaintiffs have in fact alleged that the 

product do not outweigh the risk of injury posed by its potential 

to cause serious injury, damage, or death when discharged.” 

(Merrill, supra, 26 Cal.4th at p. 478.)
24

[assault pistol] is, in the words of [former] section 1714.4, 

subdivision (a), ‘defective in design.’ ” (Ibid.) The court rejected 

the plaintiffs’ effort to recast the claim as one for “negligent 

distribution to the public,” because it was already implicit in 

negligence and strict liability theories of products liability that 

the manufacturer was in the business of distributing goods to the 

public. (Id. at p. 481.) Therefore, the court concluded, the 

plaintiffs’ allegation that the defendant made the assault pistol 

available to the general public “adds nothing to the standard 

products liability action.” (Ibid.)

As this summary suggests, Merrill did not consider 

whether every negligence claim against a manufacturer must 

include proof of a defect. Rather, it concluded that, regardless of 

how the plaintiffs labeled it, the gravamen of their purported 

negligence claim was that the assault pistol “was defective in 

design because the risks of making it available to the general 

public outweighed the benefits of that conduct, and that 

defendants knew or should have known this fact.” (Merrill, 

supra, 26 Cal.4th at p. 481.) This is not a holding that every

negligence claim to recover for injuries from a product (unless 

based on failure to warn or manufacturing defects) is necessarily 

one for negligent design, measured by one of Barker’s two tests 

for design defects. 

In arguing for a broader interpretation of Merrill, Gilead 

relies on the decision’s introductory summary of the law of 

products liability: “As Professors Prosser and Keeton explain,

‘Products liability is the name currently given to the area of the 
25

law involving the liability of those who supply goods or products

for the use of others to purchasers, users, and bystanders for 

losses of various kinds resulting from so-called defects in those 

products.’ [Citation.] As relevant here, a plaintiff may seek 

recovery in a ‘products liability case’ either ‘on the theory of strict 

liability in tort or on the theory of negligence.’ [Citations.] The 

rules of products liability ‘focus responsibility for defects, whether 

negligently or nonnegligently caused, on the manufacturer of the 

completed product.’ [Citation.] Thus, under either a negligence or 

a strict liability theory of products liability, to recover from a 

manufacturer, a plaintiff must prove that a defect caused injury. 

[Citations.] Under a negligence theory, a plaintiff must also 

prove ‘an additional element, namely, that the defect in the 

product was due to negligence of the defendant.’ ” (Merrill,

supra, 26 Cal.4th at pp. 478–479, italics added.) Read in 

isolation, the italicized language from Merrill certainly supports, 

if not flatly confirms, Gilead’s legal theory.

We decline to find Merrill controlling on this issue for three 

reasons. First, as explained above, the requirement of a defect in 

every products liability case was not an issue actually considered 

in Merrill. Rather, the court addressed only whether the legal 

test for negligent design overlapped with the test for defective 

design in such a way that the plaintiffs could not evade a ban on 

recovery under a theory of design defect by alleging negligent 

design.

Second, the authority cited by Merrill in its summary of the 

law did not consider this issue, either. The primary authority 
26

was an early law review article on products liability law by 

Professor William Prosser, which was published only three years 

after California adopted strict products liability in Greenman—

well before the doctrine’s legal framework was well defined. 

(Prosser, Strict Liability to the Consumer (1966) 18 Hastings L.J. 

9.) The cited portion of the article did not purport to opine on the 

requirements of a negligence claim in products liability actions; 

the point was that the evidence supporting a claim of defect 

under strict liability “does not appear to differ in any significant 

respect from the proof of negligence.” (Id. at p. 50.) The 

California cases cited by Merrill as authority, Jiminez, supra,

4 Cal.3d 379, and Cronin, supra, 8 Cal.3d 121, are similarly 

beside the point. Cronin considered whether a plaintiff alleging

defective design must demonstrate that the alleged defect made 

the product “unreasonably dangerous” and ultimately rejected 

this element. (Id. at pp. 132–134.) Jiminez held that a trial 

court erred in refusing to instruct the jury on negligence and res 

ipsa loquitur in a products liability case. (Jiminez, supra,

4 Cal.3d at pp. 384–387.) Neither decision holds that a plaintiff 

alleging negligence in a products liability action must in every 

case prove a product defect; although Jiminez adopted, without

discussion, defendant’s assertion that proof of a defect was 

required, it explained that “under the facts of the case before us 

instructions on negligence would serve the plaintiff better than 

instructions on defect in several respects,” suggesting the jury 
27

might have found the manufacturer liable in negligence without 

finding the product defective. (Id. at pp. 383–384.)11 

Third, accepting Merrill as controlling authority on this 

point would require a conclusion that the decision was intended 

to overrule, sub silentio, the various cases discussed above that 

permit a negligence claim to proceed in the absence of proof of a 

product defect. There is simply no indication that Merrill

intended such a change. 

Although Gilead does not expressly distinguish the 

argument, it also contends that, even if Merrill does not establish 

that proof of a defect is required in every case, the court’s 

analysis demonstrates that plaintiffs here are likewise asserting 

a claim for negligent design, and only repudiate the label in an 

effort “to avoid their concession that the TDF medications are not 

defective.” As an initial matter, plaintiffs’ decision to forgo a 

claim that TDF is defective is not a concession that TDF is not 

defective. (Cf. Toner, supra, 828 F.2d at p. 513 [“We decline to 

treat Toner’s litigation decision not to pursue the warning theory 

11 The plaintiff was injured by a ladder that broke while he 

was using it on the cement floor of his garage. He had tried to 

use it only once previously to prune a tree but stopped because 

the ground was too muddy. (Jiminez, supra, 4 Cal.3d at p. 381.) 

There was some evidence that the ladder may have broken 

because its previous use on soft soil caused the load on its legs to 

be unevenly distributed. (Id. at p. 382.) The court opined that a 

jury instructed on negligence might have found the manufacturer 

liable for failing to warn that the ladder should not be used on 

soft ground, but if instructed only on strict products liability, 

could have concluded that the ladder was not defective because it 

was safe for use on hard ground, even if use on soft ground would 

be considered a normal use of the product. (Id. at p. 385.)
28

as if it were a stipulation that Toner had adequate warning”].) 

And in any event, we find plaintiffs’ claim to be significantly 

different from the negligence claim in Merrill. Plaintiffs do not 

contend that Gilead was negligent because it made TDF available 

for sale, or because the risks of TDF outweighed its benefits. 

Rather, they contend that Gilead breached its duty of reasonable 

care by postponing, solely to maximize profit, its effort to 

commercialize TAF as a treatment for HIV/AIDS while 

continuing to market a medication with serious side effects that 

it knew TAF would have enabled patients to avoid. 

Unlike in Merrill, we cannot say that these allegations 

“add[] nothing to the standard products liability action.” (Merrill,

supra, 26 Cal.4th at p. 481.) Gilead’s alleged financially 

motivated deferral of the development of TAF for seven years, 

despite its recognition of TAF’s superiority, is discrete conduct 

independent of the design and marketing of TDF. For this 

reason, plaintiffs’ cause of action, unlike a typical negligent 

design case, will focus on “the reasonableness of the 

manufacturer’s conduct,” rather than “the condition of the 

product itself.” (Barker, supra, 20 Cal.3d at p. 434.)

Brown v. Superior Court

Gilead also relies on Brown, supra, 44 Cal.3d 1049, which 

held that prescription drugs are exempt from strict liability 

claims of defective design pursuant to comment k to section 402A 

of the Restatement Second of Torts, pages 353–354. (Brown, at 
29

p. 1061.)12 The court did not exempt prescription drugs from 

such claims because it concluded that prescription drugs cannot 

be defectively designed. On the contrary, as the court recognized, 

the design of a prescription drug might be found defective under 

the risk/benefit test if, for example, the plaintiff demonstrates 

that a particular component of the drug rendered it unsafe and 

that removal of that component would not have affected the 

efficacy of the drug or if other, less harmful drugs were available 

to treat the same condition. (Id. at p. 1062.) Rather, the court’s 

decision was grounded in public policy concerns. Subjecting 

prescription drug manufacturers to strict liability for design 

defects, the court worried, might discourage drug development or 

inflate the cost of otherwise affordable drugs. (Id. at p. 1063.)

Gilead points to the first two sentences of Brown’s 

footnote 12, which read as follows: “Our conclusion does not 

mean, of course, that drug manufacturers are free of all liability 

for defective drugs. They are subject to liability for 

manufacturing defects, as well as under general principles of 

negligence, and for failure to warn of known or reasonably 

knowable side effects.” (Id. at p. 1069, fn. 12.) According to 

Gilead, the first sentence establishes that “a defect is a necessary 

precondition of any such suit.”

12 Section 402A of the Restatement Second of Torts governs 

claims for strict products liability; comment k exempts from such 

claims “unavoidably unsafe products,” which the comment 

defines as “products which, in the present state of human 

knowledge, are quite incapable of being made safe for their 

intended and ordinary use.” (Rest.2d Torts, § 402A, com. k, 

pp. 353–354; Brown, supra, 44 Cal.3d at p. 1058.)
30

As with Merrill, however, the court in Brown was not 

considering whether every claim against a manufacturer of 

prescription drugs must prove that the drug was defective. The 

“conclusion” to which the first sentence of footnote 12 refers is the 

court’s holding that “a manufacturer is not strictly liable for 

injuries caused by a prescription drug so long as the drug was 

properly prepared and accompanied by warnings of its dangerous 

propensities that were either known or reasonably scientifically 

knowable at the time of distribution.” (Brown, supra, 44 Cal.3d 

at p. 1069.) Since the existence of a defect is the sine qua non of 

strict products liability—and the plaintiffs alleged that the drug 

was defective (id. at p. 1055)—it is not surprising that the court 

referred to manufacturers of “defective drugs” when explaining 

that its holding about strict liability did not exempt them from 

liability on other grounds. Those words reflect the issue before 

the court. Because the court had no occasion to consider any 

claim that was not premised on a defect, in context the sentence 

cannot be read to mean that every viable claim against a 

prescription drug manufacturer requires proof that the drug was 

defective. 

Gilead further contends that the reference to “general 

principles of negligence” in the second sentence of the footnote 

could only mean claims for negligent design defect, which here 

plaintiffs have abandoned. It is true that footnote 12 has been 

read to preserve claims for negligent design defect in light of the 

court’s rejection of strict liability design defect claims. (See, e.g., 

Garrett v. Howmedica Osteonics Corp. (2013) 214 Cal.App.4th 
31

173, 182; Artiglio v. Superior Court (1994) 22 Cal.App.4th 1388, 

1393.) But even if the court had in mind claims of negligent 

design defect, again the context of the footnote prevents us from 

construing it to say that no other negligence claims are 

cognizable. Nothing in the case presented that question.

Gilead also suggests that Brown’s reasoning may call into 

question some aspects even of negligent design defect claims 

insofar as the court’s policy concerns about evaluating the merits 

of a drug’s design are relevant whether the claim is based in 

strict liability or negligence.13 It is unnecessary for us to explore 

this issue in depth given plaintiffs’ disavowal of a design defect 

claim, and we again note that we do not view the negligence 

claim here as a disguised claim that TDF, at the time of its 

distribution to plaintiffs, was negligently designed. Not only does 

the claim require the trier of fact to consider conduct independent 

of TDF’s design—Gilead’s alleged recognition of TAF’s superiority 

and its reasons for pausing development—but even as to TDF’s 

design, the claim does not depend on an evaluation of the risks 

13 Gilead echoes an argument expressed by some 

commentators that there is a tension between Brown’s 

preservation of claims for negligent design defect and its rejection 

(Brown, supra, 44 Cal.3d at pp. 1066–1068) of the case-by-case 

approach to the application of comment k adopted in Kearl v. 

Lederle Laboratories (1985) 172 Cal.App.3d 812. (See Conk, Is 

There A Design Defect in the Restatement (Third) of Torts: 

Products Liability? (2000) 109 Yale L.J. 1087, 1125–1126; O’Neill, 

Jr., Unavoidably Unsafe Products and the Design Defect Theory: 

An Analysis of Applying Comment K to Strict Liability and 

Negligence Claims (1989) 15 Wm. Mitchell L.Rev. 1049, 1061–

1062 & fn. 90.)
32

and benefits of TDF as an HIV/AIDS medication, as would be 

necessary in a claim for negligent design. Although the 

characteristics of TDF as a medication are central to plaintiffs’ 

claim, these characteristics will not be evaluated in the abstract

to determine, on balance, whether TDF should have been 

marketed at all. The risks and benefits of TDF relative to each 

other are irrelevant to plaintiffs’ claim, which does not call into 

question Gilead’s decision to market TDF. On the contrary, 

plaintiffs’ claim is entirely consistent with a conclusion that the 

benefits of TDF use for hundreds of thousands of HIV/AIDS 

sufferers have vastly exceeded the harm from its side effects. 

Rather, the critical question for plaintiffs’ purposes is simply 

whether Gilead’s years-long delay in bringing TAF to market, 

despite knowing its equivalent efficacy and superior safety to 

TDF, breached a duty of reasonable care to users of TDF if the 

reason was solely to maximize Gilead’s profits. Such a claim is 

meaningfully different from the abstract consideration of risks 

and benefits central to a claim of negligent design.

Other Cases

Although a lengthy discussion is not required, the other 

cases Gilead cites similarly do not stand for the proposition that 

any negligence claim in the products liability context requires 

proof of a defect. Gilead points to the Supreme Court’s statement 

in Soule, supra, 8 Cal.4th at page 568, footnote 5, that 

manufacturers “are liable in tort only when ‘defects’ in their 

products cause injury.” But the court was not considering any 

question about negligence liability or its scope; the question 
33

before it was whether a jury should be instructed on Barker’s 

“consumer expectations” test for product defect in every case, or 

whether in some cases only the risk/benefit test is appropriate. 

(Soule, at p. 568.) The statement quoted by Gilead came in a 

footnote responding to an argument that “any limitation on use of 

the consumer expectations test contravenes Greenman’s purpose 

to aid hapless consumers,” and the court’s point was simply that 

strict liability is not unlimited. (Id. at p. 568, fn. 5.)

Likewise, Gilead’s reliance on Milwaukee Electric Tool 

Corp. v. Superior Court (1993) 15 Cal.App.4th 547 ignores its 

context. In suggestive introductory language quoted by Gilead, 

Milwaukee Tool states, “we conclude Milwaukee owes a general 

duty to produce defect-free products, which translates into a duty 

similar to that in negligence law not to depart from the 

appropriate standards of care in manufacturing its product.” (Id. 

at p. 551.) The issue actually considered in Milwaukee Tool, 

however, was the application of a then-recent Supreme Court 

decision concerning the defenses of assumption of the risk and 

comparative fault. (Id. at pp. 550, 559–564.) Although the court 

discussed the relationship between strict liability and negligence 

(id. at pp. 555–559), the discussion occurred entirely in this 

context. Milwaukee Tool did not consider whether a claim for 

negligence could be asserted in the absence of a product defect. 
34

Accordingly, we conclude that plaintiffs’ negligence claim is 

not foreclosed by their decision to forgo any attempt to prove that 

TDF is defective.14

B. New Duty Versus Exception to Existing Duty

We pause here to consider the parties’ dispute about the 

proper legal framework for analyzing plaintiffs’ negligence claim, 

since it is relevant to how we proceed in light of our conclusion in 

the preceding subsection. According to Gilead, the question is 

whether plaintiffs can establish a “new” duty—one that would 

impose further obligations on manufacturers that have produced 

a non-defective prescription drug. According to plaintiffs, the 

duty they are invoking is simply the one imposed on all persons 

by section 1714, so the question is whether Gilead can establish 

that an exception to that duty is warranted under the Rowland

factors. Both in the trial court, and originally in these writ 

proceedings, Gilead’s view of the proper question led it to disavow 

any invocation of Rowland, citing the Supreme Court’s 

explanation that “[t]he multifactor test set forth in Rowland was 

not designed as a freestanding means of establishing duty, but 

instead as a means for deciding whether to limit a duty derived 

from other sources.” (USA Taekwondo, supra, 11 Cal.5th at 

p. 217.)

14 Although plaintiffs now disavow any intent to prove 

negligent design, we agree with Gilead that the trial court’s 

ruling was in error to the extent it suggested plaintiffs can 

pursue a claim for negligent design without proving the 

equivalent of a design defect. Plaintiffs do not argue otherwise 

on appeal.
35

Gilead’s position has some logical appeal if one accepts the 

premise that, in the products liability context, the duty 

section 1714 imposes on a manufacturer is simply to ensure that 

any product it offers for sale is not defective. In that case, 

plaintiffs would have to identify a proper basis for the imposition 

of a greater duty.15 Because we have disagreed with the premise, 

however, we are unpersuaded that the burden lies with plaintiffs 

to establish the existence of a duty beyond that imposed by 

section 1714.

In arguing that plaintiffs should be required to establish 

the existence of a new duty, Gilead relies on cases that concern 

the existence of a duty to protect against harm from third parties. 

(E.g., USA Taekwondo, supra, 11 Cal.5th at p. 215; Golick v. 

State of California (2022) 82 Cal.App.5th 1127, 1140.) In that 

context, there must be a “special relationship” between the 

plaintiff and the defendant to give rise to a duty; the duty cannot 

be created through application of the Rowland factors. (USA 

Taekwondo, at pp. 216–222.) But the reason for requiring a 

special relationship is that “the law imposes a general duty of 

care on a defendant only when it is the defendant who has 

15 Plaintiffs argue that Gilead can be held liable under a 

“negligent undertaking” theory. (See Artiglio v. Corning Inc.

(1998) 18 Cal.4th 604, 612–614.) Gilead responds, first, that this 

theory is waived both because it was not pled in the complaint 

and because plaintiffs failed to raise it in response to Gilead’s 

summary judgment motion, and second, that it fails on the merits 

in any event. We do not address these arguments given our 

conclusion that Gilead has not established its entitlement to 

summary adjudication under an “ordinary negligence” theory 

pursuant to section 1714.
36

‘ “created a risk” ’ of harm to the plaintiff, including when ‘ “the 

defendant is responsible for making the plaintiff’s position 

worse.” ’ ” (Id. at p. 214.) Here, Gilead itself created the risk of 

harm to plaintiffs by selling TDF, a drug with harmful side 

effects, making inapposite the cases on which Gilead relies.

16 

Gilead also argues that its conduct, which it characterizes 

as the failure to bring a product to market, constitutes 

nonfeasance, rather than misfeasance, and quotes USA 

Taekwondo’s observation that the law is “ ‘reluctan[t] to impose 

liability’ ” for nonfeasance. (USA Taekwondo, supra, 11 Cal.5th 

at p. 214.) The court’s observation, however, was made in 

support of the general rule that a party has no duty to prevent 

harm by a third person, and was not a ruling that a party’s 

failure to act cannot constitute a breach of the duty of reasonable 

care. As the court clarified in a footnote, “[a]lthough our 

precedents have sometimes referred to the distinction between 

‘misfeasance’ and ‘nonfeasance,’ we now understand this 

terminology to be imprecise and prone to misinterpretation. ‘The 

proper question is not whether an actor’s failure to exercise 

reasonable care entails the commission or omission of a specific 

act.’ [Citation.] Rather, it is ‘whether the actor’s entire conduct 

created a risk of harm.’ ” (Id. at p. 214, fn. 6.) We are satisfied 

that, in this case, that question can be answered affirmatively, 

and accordingly that Gilead must establish that an exception to 

16 The fact that Gilead was the manufacturer of both drugs 

is also an essential element of its alleged motivation for delaying 

the commercialization of TAF and breaching its duty of care.
37

the imposition of a duty of care is warranted under the Rowland

factors.

Gilead’s failure to offer a Rowland analysis in the trial 

court—to say nothing of its failure to do so in this court before we 

requested supplemental briefing—constitutes sufficient reason 

for us to decline to reach the issue. However, in its response to 

our request, Gilead urged us to decide the applicability of a 

Rowland exception if we concluded that it furnished the proper 

framework for analyzing the claimed duty. Given the posture in 

which the case has come to us—on writ review of the denial of 

Gilead’s summary judgment motion—we believe that, to avoid to 

the extent possible the need for piecemeal adjudication and to 

provide guidance for the parties and the trial court, it is 

appropriate to exercise our discretion to address the Rowland

factors to the extent the record permits us to do so.

C. Application of the Rowland Factors

In Rowland, the California Supreme Court “identified 

several considerations that, when balanced together, may justify 

a departure from the fundamental principle embodied in Civil 

Code section 1714.” (Cabral v. Ralphs Grocery Co. (2011) 

51 Cal.4th 764, 771 (Cabral).) The Rowland analysis “is 

conducted ‘at a relatively broad level of factual generality.’ 

[Citation.] We analyze the Rowland factors to determine ‘not

whether they support an exception to the general duty of

reasonable care on the facts of the particular case before us, but

whether carving out an entire category of cases from that general

duty rule is justified by clear considerations of
38

policy.’ ” (Kuciemba v. Victory Woodworks, Inc. (2023) 14 Cal.5th 

993, 1021 (Kuciemba).) “By making exceptions to Civil Code 

section 1714’s general duty of ordinary care only when 

foreseeability and policy considerations justify a categorical noduty rule, we preserve the crucial distinction between a 

determination that the defendant owed the plaintiff no duty of 

ordinary care, which is for the court to make, and a 

determination that the defendant did not breach the duty of 

ordinary care, which in a jury trial is for the jury to make. . . . 

While the court deciding duty assesses the foreseeability of injury 

from ‘the category of negligent conduct at issue,’ if the defendant 

did owe the plaintiff a duty of ordinary care the jury ‘may 

consider the likelihood or foreseeability of injury in determining 

whether, in fact, the particular defendant’s conduct was negligent 

in the first place.’ ” (Cabral, at p. 773.)

The Rowland factors fall into two categories. “Three 

factors—foreseeability, certainty, and the connection between the 

plaintiff and the defendant—address the foreseeability of the 

relevant injury, while the other four—moral blame, preventing 

future harm, burden, and availability of insurance—take into 

account public policy concerns that might support excluding 

certain kinds of plaintiffs or injuries from relief.” (Kesner, supra,

1 Cal.5th at p. 1145). Issues related to foreseeability are assessed 

on the basis of information available at the time of the alleged 

negligence, while “ ‘our duty analysis is forward-looking’ in

regard to policy issues surrounding burdens that would be placed

on defendants.” (Kuciemba, supra, 14 Cal.5th at p. 1022.)
39

1. Gilead’s Proposed Expansive Exception

In requesting a Rowland exception to the duty of 

section 1714, Gilead proposes two alternatives. The first, the 

more expansive exception, would hold that when an FDAapproved prescription drug is accompanied by an adequate 

warning of its side effects, and is not shown to be defective in 

design or manufacture, the manufacturer does not owe users of 

the current drug a duty of reasonable care in its decisions about 

commercializing any alternative drug the manufacturer might 

invent. We emphasize that it is a necessary premise of this 

analysis that the same manufacturer has developed both drugs. 

As discussed above, the manufacturer’s duty with respect to any 

alternative drug arises only because its sale of the first drug has 

created the risk of harm. (See O’Neil v. Crane Co. (2012) 

53 Cal.4th 335, 342 (O’Neil) [“a product manufacturer may not be 

held liable . . . for harm caused by another manufacturer’s 

product unless the defendant’s own product contributed 

substantially to the harm, or the defendant participated 

substantially in creating a harmful combined use of the 

products”].)

Because plaintiffs assert that Gilead knew TAF was safer

than TDF, we also conduct the Rowland analysis under the 

assumption that the drug manufacturer knows that the 

alternative drug is safer than (and at least as effective as) the 

current drug. As noted earlier, we offer no opinion about whether 

plaintiffs should be permitted to argue constructive knowledge on 

remand, assuming they were to seek to do so, but we think a
40

different Rowland analysis would be required for a claim based 

on constructive knowledge. Among other things, a constructive 

knowledge standard would be more susceptible to hindsight bias 

by the jury, and would therefore present more challenging policy 

issues than in a case in which no duty arises in the absence of 

proof that the manufacturer knew it had developed a safer and at 

least equally effective alternative.

i. Foreseeability factors

The first three Rowland factors are commonly referred to 

as the foreseeability factors: “the foreseeability of harm to the 

plaintiff, the degree of certainty that the plaintiff suffered injury, 

and the closeness of the connection between the defendant’s 

conduct and the injury suffered.” (Rowland, supra, 69 Cal.2d at 

p. 113.) Again, we evaluate these factors on the basis of 

information available at the time of the alleged negligence. 

(Kuciemba, supra, 14 Cal.5th at p. 1022.) In considering 

foreseeability, we focus not on particularities of the defendant’s 

conduct and the plaintiff’s injury, but on “whether the category of 

negligent conduct at issue is sufficiently likely to result in the 

kind of harm experienced that liability may appropriately be 

imposed . . . .” (Cabral, supra, 51 Cal.4th at p. 772.)

Foreseeability of injury. Of the seven Rowland factors, the 

foreseeability of harm to a plaintiff from the defendant’s conduct 

is “[t]he most important factor to consider in determining 

whether to create an exception to the general duty to exercise 

ordinary care articulated by section 1714.” (Kesner, supra, 

1 Cal.5th at p. 1145.)
41

In any case involving a drug with a proper warning of side 

effects, it is a given that injury from side effects is foreseeable. 

We agree with Gilead, however, that in this context the relevant 

question is whether it is foreseeable that the new, safer, drug 

would enable users to avoid the injury. Gilead posits several

considerations that it contends weigh against foreseeability, such 

as the degree to which the new drug avoids side effects, the 

relative efficacy of the new drug, and any additional side effects 

of the new drug. However, because Gilead’s proposed expansive 

exception would impose no duty of care notwithstanding the 

manufacturer’s knowledge that the new drug is at least equally 

effective and poses a lower risk of side effects, we think it is 

foreseeable that the manufacturer’s delay in commercializing the 

new drug will cause some users to suffer injury they could have 

avoided had the new drug been available. Although the factors

Gilead identifies affect the extent of harm that will be 

anticipated, and therefore will factor into any evaluation of the 

reasonableness of the manufacturer’s conduct, they do not alter 

the conclusion that Gilead’s proposed expansive exception will 

result in foreseeable injury. Speaking generally, as we must in 

applying Rowland, Gilead’s proposed expansive exception, which 

would permit manufacturers to delay the release of a safer drug 

indefinitely, will make otherwise avoidable injury foreseeable.

Degree of certainty that the plaintiff suffered injury. “The 

second Rowland factor, the degree of certainty that the plaintiff 

suffered injury, ‘has been noted primarily, if not exclusively, 

when the only claimed injury is an intangible harm such as 
42

emotional distress.’ ” (Kesner, supra, 1 Cal.5th at p. 1148.) 

Because we assume the existing drug creates identifiable and 

characteristic physical injury, the fact of injury is certain.

Closeness of the connection between the defendant’s conduct 

and the injury. This factor is “strongly related to the question of 

foreseeability itself.” (Cabral, supra, 51 Cal.4th at p. 779.) The 

premise of our analysis is that some patients will suffer the 

warned-of side effects associated with the existing drug and the 

manufacturer knows that the alternative drug would allow some 

of those patients to avoid them. We therefore find the connection 

close even though, as Gilead points out in its foreseeability 

analysis, there are two additional steps in the causal chain that 

are necessary in order for patients to avoid the harm: first, the 

FDA must approve the alternative drug candidate, and second, 

the patient’s doctor must decide to switch the patient to the new 

medication after it is approved. Of the two, we view the second 

consideration as less significant because once the FDA has 

approved an alternative that is safer and at least equally 

effective for the patient concerned, the manufacturer would 

reasonably expect doctors to prescribe the new medication in 

place of the old. (Cf. T.H., supra, 4 Cal.5th at p. 167 [close 

connection where defective label led doctor to prescribe the 

drug].)

As to the question of FDA approval, we do not doubt that 

there is often considerable uncertainty associated with it. While 

plaintiffs’ claim here was brought after the FDA approved TAF, 

hindsight bias should not be permitted to affect the analysis. 
43

Plaintiffs do not dispute the assertion by Gilead and its amici 

that, of medicines entering clinical trials, fewer than one out of 

eight will obtain FDA approval. However, because we are 

considering a categorical exception that would apply at any point 

in the development process to a drug candidate that the 

manufacturer knows to be as effective as, and safer than, an 

existing drug, these two common grounds for denial of FDA 

approval are likely to be adequately addressed. That makes FDA 

approval far less uncertain than might otherwise be the case.

17

While the record does not tell us whether the example of 

TAF is typical, plaintiffs emphasize that TAF was another form 

of the known compound tenofovir; Gilead made its decision to 

pause development after TDF had already been approved by the 

FDA, and after Gilead had the results of its Phase I/II testing of 

TAF. Plaintiffs contend that Gilead knew FDA approval of TAF 

would not be difficult, and their allegation that Gilead was 

motivated by its concern that TAF would cannibalize sales of 

TDF and believed it could maximize profitability by extending 

the life of its tenofovir patents necessarily assumes as much. 

Nothing in the record presented to us establishes that drug 

17 Some commentators have argued that any design defect 

claim that requires a court to predict whether the FDA would 

approve what a plaintiff proposes as a “reasonable alternative 

design” of the allegedly defective drug is unworkable given the 

uncertainty involved. (See, e.g., Twerski, The Demise of Drug 

Design Litigation: Death by Federal Preemption (2018) 68 Am. U. 

L.Rev. 281, 295.) We do not see the same uncertainty, at least as 

a categorical matter, in a situation in which the manufacturer 

has developed an alternative drug that it knows to be safer than 

its original drug.
44

companies are never able, at any point, to assess the likelihood of 

FDA approval of a particular medicine beyond what can be 

gleaned from general industry averages. Drug manufacturers’ 

decisions about whether to continue to pursue commercialization 

of a drug are presumably informed in part by their assessment of 

the likelihood of FDA approval; Gilead does not argue to the 

contrary. We are not persuaded that the need for FDA approval 

necessarily renders the harm unforeseeable or severs what would 

otherwise be a close connection between the manufacturer’s 

decisions and the patients’ harm. 

Finally, citing O’Neil, supra, 53 Cal.4th at p. 365, Gilead 

argues that we should not find a close connection because the 

alleged negligent conduct is not the manufacturer’s sale of the 

injurious product, i.e., the existing drug. But O’Neil concerned 

the circumstances under which a manufacturer could be held 

liable for injuries caused by products it did not manufacture, sell, 

or supply. That is not the situation we are considering here, and 

the fact that the alleged negligence is the decision to delay 

commercialization of the alternative drug rather than the sale of 

the existing, more dangerous drug does not make the connection 

between the negligent conduct and the injury remote where the 

manufacturer has control over the timing of the availability of 

the safer drug. (See T.H., supra, 4 Cal.5th at p. 168 

[distinguishing O’Neil based on brand-name drug manufacturer’s 

control over the content of the label].)
45

Accordingly, the foreseeability factors weigh against 

Gilead’s proposed expansive Rowland exception to the duty of 

reasonable care.

ii. Public policy factors

“[F]oreseeability alone is not sufficient to create an

independent tort duty. ‘ “ . . . [The] existence [of a duty] depends

upon the foreseeability of the risk and a weighing of policy

considerations for and against imposition of liability.” ’ ” (Erlich

v. Menezes (1999) 21 Cal.4th 543, 552.) “The overall policy of 

preventing future harm is ordinarily served, in tort law, by 

imposing the costs of negligent conduct upon those responsible. 

The policy question is whether that consideration is outweighed, 

for a category of negligent conduct, by laws or mores indicating 

approval of the conduct or by the undesirable consequences of 

allowing potential liability.” (Cabral, supra, 51 Cal.4th at p. 781; 

see Merrill, supra, 26 Cal.4th at p. 502 [foreseeability may be 

overcome “where the social utility of the activity concerned is so 

great, and avoidance of the injuries so burdensome to society, as 

to outweigh the compensatory and cost-internalization values of 

negligence liability”].)

The final four factors of the Rowland test are referred to as 

the “public policy factors” (Cabral, supra, 51 Cal.4th at p. 781): 

“the moral blame attached to the defendant’s conduct, the policy 

of preventing future harm, the extent of the burden to the 

defendant and consequences to the community of imposing a duty 

to exercise care with resulting liability for breach, and the 
46

availability, cost, and prevalence of insurance for the risk 

involved.” (Rowland, supra, 69 Cal.2d at p. 113.)

Moral blame. Developing and selling a life-saving drug, 

even one with potentially severe side-effects, is morally 

praiseworthy. But that is not the conduct at issue; Gilead seeks 

an exception that would allow, in a sense, the opposite conduct: a 

manufacturer’s decision not to market, or to delay marketing, a 

drug it invented that would avoid the harm caused by an existing 

drug that the manufacturer continues to sell. “We have said that 

if there were reasonable ameliorative steps the defendant could 

have taken, there can be moral blame ‘attached to the 

defendants’ failure to take steps to avert the foreseeable harm.’ ” 

(Vasilenko v. Grace Family Church (2017) 3 Cal.5th 1077, 1091

(Vasilenko).) 

Moral blame is typically found when the defendant benefits 

financially from its conduct. (Kuciemba, supra, 15 Cal.5th at 

p. 1025; Kesner, supra, 1 Cal.5th at p. 1151.) In general, drug 

manufacturers reasonably expect to profit from the medicines 

they sell, and the exception Gilead seeks would allow them to 

extend the time patients are subjected to the risks associated 

with a more dangerous drug precisely because delaying the 

commercialization of a safer alternative would confer a financial 

benefit. 

In addition, “[r]elative inequality between the parties may 

also bear upon moral blame. ‘We have previously assigned moral 

blame, and we have relied in part on that blame in finding a 

duty, in instances where the plaintiffs are particularly powerless 
47

or unsophisticated compared to the defendants or where the 

defendants exercised greater control over the risks at issue.’ ” 

(Kuciemba, supra, 15 Cal.5th at p. 1026.) Users of a particular 

medicine generally have no ability to avoid its harmful side 

effects. (Brown, supra, 44 Cal.3d at p. 1063.) And it is the 

manufacturer’s decisions about commercialization of the safer 

alternative that are the primary determinants of whether 

patients will continue to be subject to those risks. (Compare 

Vasilenko, supra, 3 Cal.5th at p. 1091 [finding little moral blame 

because “landowners have limited ability to reduce the danger 

and generally exercise no greater control over the danger than 

the invitees who cross” public streets] with Kesner, supra, 

1 Cal.5th at p. 1151 [finding moral blame because “commercial 

users of asbestos benefitted financially from their use of asbestos 

and had greater information and control over the hazard than 

employees’ households”].)

We can agree with Gilead that a manufacturer’s decision to 

delay the commercialization of a safer drug may be made for 

morally neutral, or even worthy, reasons. But while we do not 

assume in considering the requested exception that any claimed 

violation of duty will involve the precise conduct that plaintiffs 

attribute to Gilead in this case, our task is to evaluate the degree 

of moral blame that attaches to negligence in a drug 

manufacturer’s decisions about commercializing a safer drug, not 

to potential non-negligent reasons for its actions. (See, e.g., 

Kesner, supra, 1 Cal.5th at p. 1151 [“negligence in their use of 

asbestos is morally blameworthy”]; Regents of University of 
48

California v. Superior Court (2018) 4 Cal.5th 607, 631 [“Some 

measure of moral blame does attach to a university’s negligent 

failure to prevent violence against its students”].) Gilead argues

that we are concerned here only with drugs that are not shown to 

be defective and so should be considered “reasonably safe.” But 

even putting aside what plaintiffs contend are increasingly 

insurmountable legal barriers to the assertion of design defect 

claims notwithstanding their substantive merit, a life-saving 

drug may be considered reasonably safe, in the sense that its 

risks are outweighed by its benefits, even when its side effects 

are grievously injurious. That such side effects are an acceptable 

trade-off when life is at stake does not mean that the 

manufacturer’s decision to continue to subject patients to those 

injuries unnecessarily by delaying or withholding a safer 

alternative is morally unobjectionable. 

In sum, although moral blame “can be difficult to assess in 

the absence of a factual record” (Kesner, supra, 1 Cal.5th at 

p. 1151), we conclude based on the considerations above that 

negligence in a decision that deprives people of a safer drug and 

leaves them reliant on a more dangerous drug is morally 

blameworthy.

Policy of preventing future harm. The “policy of preventing 

future harm is ordinarily served, in tort law, by imposing the 

costs of negligent conduct upon those responsible.” (Cabral,

supra, 51 Cal.4th at p. 781.) For the purpose of the Rowland 

analysis, “[t]he policy question is whether that consideration is 

outweighed, for a category of negligent conduct, by laws or mores 
49

indicating approval of the conduct or by the undesirable 

consequences of allowing potential liability.” (Id. at pp. 781–782.) 

This factor thus “examines both the positive and the negative 

societal consequences of recognizing a tort duty.” (Kuciemba,

supra, 15 Cal.5th at p. 1026.)

Plaintiffs argue that recognizing a duty would result in 

speedier delivery of improved medications, whereas Gilead 

contends that the fear of liability or litigation would 

disincentivize manufacturers from undertaking the development 

of improved drugs in the first place, or would perversely skew 

their development priorities once they have produced some data 

suggesting that a drug candidate is safer.

Gilead purports to find support for its argument in Brown, 

because the court rejected strict liability out of a concern that it 

would make pharmaceutical manufacturers reluctant to 

undertake research projects to develop new drugs or to distribute 

others that are available to be marketed. (Brown, supra, 

44 Cal.3d at p. 1063.) But as the court pointed out in its analysis, 

that possibility arises in significant part because strict liability 

makes manufacturers liable for unforeseen and unforeseeable 

harm. (See id. at pp. 1063–1064; see also Carlin, supra,

13 Cal.4th at p. 1117 [Brown’s policy-based rejection of strict 

liability for design defects was premised on the fact that it would 

“potentially subject drug manufacturers to liability for flaws in 

their products that they have not, and could not have, 

discovered”].) As we have discussed, the court expressly declined 

to protect them from claims based in negligence, in which the 
50

harm must be foreseeable. (Brown, at p. 1069, fn. 12.)18 

Moreover, while drug manufacturers have continued to resist the 

imposition of liability in other contexts by asserting that it would 

chill innovation, courts after Brown have declined to accept those 

assertions as unsupported by an evidentiary showing. (See, e.g., 

Carlin, supra, 13 Cal.4th at p. 1117; T.H., supra, 4 Cal.5th at 

p. 173; Conte, supra, 168 Cal.App.4th at p. 106.) It is similarly 

unsupported here.

Gilead elsewhere argues that the imposition of the duty 

plaintiffs propose is unnecessary, contending that “[i]f a drug 

manufacturer has a treatment that is much better or safer than 

what is already on the market, it has an economic imperative to 

bring it to market as soon as possible.” Plaintiffs disagree, 

arguing that the patent system incentivizes drug manufacturers

to try to extend their monopolies for as long as possible, with 

deleterious effects on innovation and competition. (See, e.g., 

Bernstein, supra, at pp. 71–74; Gurgula, Strategic Patenting by 

Pharmaceutical Companies—Should Competition Law Intervene?, 

IIC Int Rev Ind Prop Copyr Law 2020; 51(9): 1062–1085, 

https://doi.org/10.1007/s40319-020-00985-0 [as of Jan. 4, 2024].) 

18 Plaintiffs also note that Brown’s categorical exemption 

for strict liability design defect claims is the minority view among 

courts that have adopted comment k (see Moss v. Wyeth Inc.

(D. Conn. 2012) 872 F.Supp.2d 162, 167–168), and assert that 

fear of potential liability in other jurisdictions has not damaged 

the pharmaceutical industry. The significance of that point, 

however, may be diminished by what plaintiffs elsewhere 

describe as the substantial elimination of design defect claims by 

federal preemption.
51

Plaintiffs’ argument supports a conclusion that the duty of care 

serves an important policy function, but even if we credit Gilead’s 

suggestion that the duty aligns with economic imperatives that 

drug manufacturers already face, it would tend to undermine the 

hypothesis that imposition of the duty would radically alter their 

incentives to improve existing drugs or develop new ones. And 

again, we are considering here a duty that arises only with the 

manufacturer’s knowledge that the alternative drug candidate it 

has invented is safer and would allow harm to be avoided. (See 

T.H., supra, 4 Cal.5th at p. 185 [policy of preventing future harm 

is furthered when the duty is placed on the entity with the power 

to act].) Moreover, although below we conclude that Gilead has 

not supported its proposed narrower exception on the existing 

record, the potential availability of a narrower exception 

militates against a conclusion that the broader one is necessary 

to avoid the undesirable social consequences that Gilead posits.

Finally, we emphasize that the duty of reasonable care does 

not require the pursuit of commercialization at all costs. Even if 

we assume that there will be some circumstances in which the 

duty causes a manufacturer to pursue a potentially safer product 

longer than it otherwise would have, resulting in some failed or 

wasted efforts, that loss must be weighed against the benefit to 

the community from successful efforts, which will result in safer 

products. 

In short, we are not persuaded that Gilead has established 

that there are “undesirable consequences of allowing potential 

liability” (Cabral, supra, 51 Cal.4th at p. 782) that should 
52

override the ordinary rule “imposing the costs of negligent 

conduct upon those responsible” in these circumstances (id. at 

p. 781).

The burden to the defendant and consequences to the 

community. Because the “consequences to the community” 

portion of this factor overlaps with our discussion of the policy of 

preventing future harm (cf. T.H., supra, 4 Cal.5th at pp. 168–

173), we focus here on what Gilead contends will be an additional 

burden; namely, a flood of lawsuits because patients will contend 

that every improved medicine released by a manufacturer should 

have been made available sooner. 

We think Gilead overstates the threat given the 

narrowness of the duty at issue. It does not apply generally to 

“improved” products, but only to products that the manufacturer 

knows will avoid significant side effects of a manufacturer’s 

existing product. Gilead does not establish that this situation 

arises so frequently as to result in a flood of litigation. On the 

contrary, if this situation were common, the claim likely would 

have arisen long ago. Nor, contrary to Gilead’s argument, will 

the duty upend products liability by creating a “perfect product” 

law. As we have noted, the duty does not require manufacturers 

to perfect their drugs, but simply to act with reasonable care for 

the users of the existing drug when the manufacturer has 

developed an alternative that it knows is safer and at least 

equally efficacious. Manufacturers already engage in this type of 

innovation in the ordinary course of their business, and most 
53

plaintiffs would likely face a difficult road in establishing a 

breach of the duty of reasonable care.

Availability and cost of insurance. Gilead contends that 

recognition of a duty “would massively expand manufacturers’ 

existing exposure to liability,” which in turn would increase the 

cost of insurance “if it were available at all” and thereby raise the 

price of prescription medicines. But for the reasons discussed 

above, we are not persuaded that the expansion of liability is 

anywhere near as “massive” as Gilead suggests, and as plaintiffs 

note, there is nothing in the record regarding the cost and 

availability of insurance. We find that the parties have not 

supplied enough information “to settle the question of insurance 

one way or the other.” (Vasilenko, supra, 3 Cal.5th at p. 1091.)

Again, the most important factor to be evaluated in 

applying Rowland is the prevention of foreseeable harm. In the 

narrow circumstances in which it applies, plaintiffs’ duty would 

prevent manufacturers from delaying the development of safer 

treatments, thereby avoiding foreseeable harm to a potentially 

large class of persons. Although the duty may impose some 

burdens on pharmaceutical manufacturers, we are not persuaded 

that they would be so great as to overcome the benefit of safer 

products. The expansive exception proposed by Gilead is 

therefore not appropriate. 

2. Gilead’s Narrower Exception

Although Gilead does not offer two separate Rowland

analyses, at various points in its supplemental briefing it 

suggests, as a fallback position, a narrower exception tied to
54

manufacturers’ Phase III clinical trials, which are the final stage 

in the process required to obtain approval of a new drug. 

Following the submission of preclinical trial data to the FDA, the 

manufacturer conducts clinical trials in three phases. (21 C.F.R.

§§ 312.23(a)(8), 312.21(a)–(c) (2022).) “Phase I clinical trials are 

conducted on healthy volunteers to determine the maximum 

tolerated dose, adverse events, and pharmacokinetics of a 

product. Phase II studies are conducted on a statistically 

relevant number of patients having a specific disease to 

determine initial efficacy in humans for that disease, and to 

identify possible adverse effects and safety risks. Phase III 

studies consist of wide-scale studies on patients with the disease 

for which the drug is intended and evaluate the overall risks and 

benefits of the drug.” (Deveny v. Entropin, Inc. (2006) 

139 Cal.App.4th 408, 413, fn. 2.) Phase I trials “are generally 

conducted on a small number of healthy volunteer subjects,” 

whereas Phase II trials “usually involve several hundred people” 

and Phase III trials consist of “several hundred to several 

thousand” subjects. (Schiff v. Prados (2001) 92 Cal.App.4th 692, 

696, fn. 2.) 

Gilead’s narrower exception would hold that when an FDAapproved prescription drug is accompanied by an adequate 

warning of adverse side effects, and is not shown to be defective 

in design or manufacture, the manufacturer does not owe users of 

the previously-approved drug a duty of reasonable care in its 

decisions about commercializing an alternative drug until 

Phase III trials have established its safety and effectiveness.
55

We conducted our analysis of the broader Rowland 

exception under the assumption that the duty of care arises when 

the manufacturer knows that the alternative drug candidate is 

safer than, and at least as effective as, the existing drug. But in 

many cases the parties will dispute, as they do in this case, 

whether the manufacturer actually knew that the alternative 

candidate was superior when the manufacturer made the 

decision or decisions at issue. Gilead’s narrower exception 

essentially proposes, as a policy matter, that the amount of 

knowledge necessary to trigger the imposition of a duty of care 

cannot exist before the manufacturer has the results of Phase III 

trials of the alternative drug.19

i. Foreseeability factors

It is reasonable to expect a manufacturer to learn more 

about a drug candidate’s safety and efficacy at each stage of the 

investigation process, so as a general matter, we see no reason to 

doubt that a manufacturer will be able to foresee with greater 

confidence that a new drug will avoid the harmful side effects 

associated with the existing drug, while providing the same 

therapeutic benefit, after Phase III than after Phase II. 

19 Notwithstanding its Phase III proposal, Gilead actually 

contends that “[t]he earliest point at which it would be 

reasonably foreseeable that injury from an existing non-defective 

medicine could be prevented by a new product is when the FDA 

approves the drug and the drug’s comparative safety has been 

proven in head-to-head to studies.” According to Gilead, head-tohead studies are not necessary to obtain FDA approval, but are 

required to justify any claim comparing the safety or 

effectiveness of two drugs, and can be conducted during Phase III 

trials or after FDA approval. 
56

Plaintiffs, however, argue that a manufacturer’s knowledge prior 

to the conclusion of Phase III trials will vary, depending on how 

much is already known about the compound being studied and on 

what the Phase I and II results show.

While some generalizations are probably necessary to 

evaluate the appropriateness of any proposed Rowland exception, 

here no factual record has been developed in the trial court that 

would allow us to assess the parties’ competing claims. In the 

absence of such a record, we cannot say whether it is possible to 

make any meaningful generalizations about what can reasonably 

be known after Phase II trials as compared to Phase III trials, 

and what those generalizations would be. And we do not know, 

for example, how often, or under what circumstances, a drug’s 

apparent promise after Phase II is undermined by unexpected 

results in Phase III—or how often uncertain Phase II results are 

followed by confirmed successes in Phase III. Thus, on the 

existing record, Gilead has not established that it is not 

foreseeable before Phase III trials that the manufacturer’s 

conduct would cause otherwise avoidable injury.

ii. Public policy factors

The policy rationale for Gilead’s narrow exception is that 

allowing a jury to decide on a case-by-case basis whether the 

manufacturer had the requisite knowledge creates too much 

uncertainty, giving rise to unacceptable burdens on 

manufacturers, such as disincentivizing innovation and causing 

excessive and unwarranted litigation. The exception would 

create a safe harbor period in the drug development process in 
57

which manufacturers may make decisions without fear that they 

may be second-guessed by a jury, and conversely, would let them 

know with certainty at what point their decisions could be 

scrutinized for failure to exercise reasonable care.

We do not rule out the possibility that such an exception 

could be warranted. “In conducting its [duty] analysis, the court 

may take into account factors that might escape the jury’s 

attention in a particular case, such as the overall social impact of 

imposing a significant precautionary obligation on a class of 

actors. These cases are properly decided as duty or no-duty 

cases. When no such categorical considerations apply and 

reasonable minds could differ about the competing risks and 

burdens or the foreseeability of the risks in a specific case, 

however, courts should not use duty and no-duty determinations 

to substitute their evaluation for that of the factfinder.” (Cabral, 

supra, 51 Cal.4th at p. 773, fn. 3 [quoting Rest.3d Torts, Liability 

for Physical and Emotional Harm, § 7, com. i, pp. 81–82].) As 

Brown indicates, “categorical considerations” may come into play 

in the prescription drug context, although nothing in that case 

suggests that manufacturers need greater protection than the 

decision itself supplies.

Still, we believe a decision to delay commercialization of a 

new drug, when it is made earlier in the development process, 

may be more complicated and challenging for a jury to evaluate, 

and more susceptible to hindsight bias, than one made after 

Phase III trials are completed. Phase III trials are likely to be 

substantially more difficult and expensive than those occurring 
58

during Phases I and II, so the burden on pharmaceutical 

manufacturers is undoubtedly greater if those trials are 

undertaken out of a “precautionary obligation.” On the other 

hand, plaintiffs counter that the proposed exception would render 

the remaining duty of care largely toothless because 

manufacturers often have sufficient information after Phase II 

and, like Gilead, could simply make the relevant decisions at that 

point in order to avoid liability. 

Ultimately, however, the problem remains the lack of a 

factual record by which to assess whether it is appropriate to 

recognize a categorical exception for decisions made before the 

completion of Phase III trials. We recognize that the 

appropriateness of a Rowland exception can sometimes be 

identified early in a case, even on a motion addressed to the 

pleadings. (See, e.g., Kuciemba, supra, 14 Cal.5th at p. 1004; 

Kesner, supra, 1 Cal.5th at p. 1142.) In other cases, it is raised 

later, at summary judgment or even after a jury verdict. (E.g., 

Vasilenko, supra, 3 Cal.5th at pp. 1082–1083; Cabral, supra, 

51 Cal.4th at p. 770.) While the Rowland analysis does not focus 

on the defendant’s specific conduct, it may still present difficult 

factual questions that cannot be reliably resolved simply by 

weighing competing assertions in briefs by the parties and their 

amici. We conclude that Gilead has failed to establish that its 

narrow exception is warranted on the current record. However, 

our conclusion does not prevent Gilead from seeking the

exception based on a record developed later in the trial court, 
59

both before that court and, if necessary, on appeal from an 

adverse judgment.

II. Fraudulent Concealment

Plaintiffs’ cause of action for fraudulent concealment 

alleges that Gilead was required to disclose that (1) TAF was a 

safer means for delivering tenofovir into the body, (2) the toxicity 

of tenofovir was not unavoidable, and (3) Gilead’s true motive for 

shelving TAF development was financial. Gilead argues that it is 

entitled to summary adjudication of this claim because it was 

under no duty to disclose to plaintiffs facts relating to TAF, which 

was not available as an alternative to TDF for the treatment of 

HIV/AIDS. We agree.

“ ‘[T]he elements of an action for fraud and deceit based on 

a concealment are: (1) the defendant must have concealed or 

suppressed a material fact, (2) the defendant must have been 

under a duty to disclose the fact to the plaintiff, (3) the defendant 

must have intentionally concealed or suppressed the fact with the 

intent to defraud the plaintiff, (4) the plaintiff must have been 

unaware of the fact and would not have acted as he did if he had 

known of the concealed or suppressed fact, and (5) as a result of 

the concealment or suppression of the fact, the plaintiff must 

have sustained damage.’ ” (Roddenberry v. Roddenberry (1996) 

44 Cal.App.4th 634, 665–666.)

As explained in Bigler-Engler v. Breg, Inc. (2017) 

7 Cal.App.5th 276, in the absence of a fiduciary relationship 

between the parties, the law “ ‘presuppose[s] the existence of 

some other relationship between the plaintiff and defendant in 
60

which a duty to disclose can arise.’ [Citation.] . . . [¶] Our 

Supreme Court has described the necessary relationship giving 

rise to a duty to disclose as a ‘transaction’ between the plaintiff 

and the defendant . . . . Such a transaction must necessarily 

arise from direct dealings between the plaintiff and the 

defendant; it cannot arise between the defendant and the public 

at large.” (Id. at pp. 311–312.) Once the necessary relationship 

is found, a duty arises “to disclose facts material to the 

transaction.” (LiMandri v. Judkins (1997) 52 Cal.App.4th 326, 

337.) We have recently held, for example, that a vehicle 

manufacturer owes a duty to purchasers of its vehicles to disclose 

known defects. (Dhital v. Nissan North America, Inc. (2022) 

84 Cal.App.5th 828, 844; see similarly, Snow v. A. H. Robins Co. 

(1985) 165 Cal.App.3d 120, 134–135 [manufacturer of 

intrauterine device had duty to disclose higher pregnancy rates 

from its use].)

Assuming that plaintiffs’ use of Gilead’s product, TDF, 

created the relationship necessary to invoke the law of 

concealment, we nonetheless conclude that such a duty did not 

extend to the disclosure of information about TAF. Gilead owed a 

duty to plaintiffs to disclose information material to the 

transaction that created the disclosure relationship—plaintiffs’ 

use of TDF as a medicine. The facts material to this treatment 

decision concerned the efficacy, side effects, risks, and cost of 

TDF, which plaintiffs and their physicians could compare with 

similar information about other available medicines in deciding 

the best course of treatment. For the 14 years between the 
61

commencement of Gilead’s sales of TDF and the FDA’s approval 

of TAF as an HIV/AIDS medication, TAF was not available to 

patients as a treatment. Information about a chemical compound 

that was not available as a treatment, and could not possibly 

become available as a treatment for many years as a result of the 

time-consuming FDA approval process, would not have been 

material to the treatment decision. Even the acknowledgment by 

Gilead that the toxicity of tenofovir was avoidable, as plaintiffs 

allege, would have been of no use to patients in deciding whether 

to take TDF, since their choice was between TDF and other 

available medications, not between TDF and its allegedly safer 

counterpart, TAF.

Plaintiffs argue that disclosure of information about TAF 

might have affected physicians’ practices in prescribing TDF, but 

their reasoning is impermissibly speculative. Plaintiffs argue, in 

effect, that the disclosure of information suggesting that TAF was 

a superior alternative to TDF might have biased physicians 

against the use of TDF. This bias, they theorize, would have 

caused physicians to decrease their use of TDF, even though the 

disclosure would have in no way changed the value of TDF 

relative to other available treatments.20 It is not clear, however, 

20 For example, plaintiffs cite evidence suggesting some 

Gilead employees were concerned that disclosure of information 

about TAF would change medical perceptions of the risk profile of 

TDF. Such a change in perception, however, would not have been 

based on the relative value of TDF and other available 

medications. Rather, it would have been the result of bias 

against TDF generated by physicians’ knowledge that Gilead 

could, if it chose, have produced a safer drug.
62

that information about TAF should be considered material to the 

treatment decision merely because it might have changed that 

decision for irrational reasons. Plaintiffs’ contention is, in any 

event, entirely speculative and does not make information about 

TAF material to the decision to use TDF.

Plaintiffs also cite their allegation that Gilead stopped 

work on TAF because Gilead believed that a TAF-containing 

medication would “cannibalize” its sales of TDF. Even if true, 

that motivation did not create a duty to disclose information 

about TAF. TAF could cannibalize TDF sales only if TAF existed 

as an alternative treatment. So long as Gilead chose to avoid 

cannibalization by keeping TAF from the market, information 

about TAF’s efficacy and risks relative to TDF had no bearing on 

physicians’ or patients’ treatment decisions.

DISPOSITION

Gilead’s petition for a writ of mandate is denied in part and 

granted in part. Let a peremptory writ of mandate issue 

directing the superior court to vacate its order denying Gilead’s 

motion for summary judgment, dated June 13, 2022, and enter a 

new and different order denying summary adjudication of 

Count I of plaintiffs’ Master Long Form Complaint for Damages 

and granting summary adjudication of Count V of that document. 

The stay imposed in our order of September 9, 2022, shall remain 

in effect until issuance of the remittitur. Plaintiffs shall recover 

their costs on appeal.

GOLDMAN, J.

WE CONCUR:
63

BROWN, P. J. 

BURNS, J. *

* Associate Justice of the Court of Appeal, First Appellate 

District, Division Five, assigned by the Chief Justice pursuant to 

article VI, section 6 of the California Constitution.
64

Trial Court: City and County of San Francisco Superior 

Court

Trial Judge: Honorable Andrew Y.S. Cheng

Gilead Sciences, Inc., Defendant and 

Petitioner: 

SIDLEY AUSTIN, Debra Pole, Joshua 

Anderson, Sean Commons, David Carpenter, 

Collin Wedel

ORRICK, HERRINGTON & SUTCLIFFE, 

Andrew Silverman, Siobhan Atkins, Cesar 

Lopez-Morales, E. Joshua Rosenkranz

Superior Court of the City & County of 

San Francisco, Respondent: 

No attorneys listed

Plaintiffs in JCCP No. 5043 Gilead 

Tenofovir Cases, Real Parties in 

Interest

GRANT & EISENHOFFER, M. Elizabeth 

Graham

JENNER LAW, Robert K. Jenner

MOSKOVITZ APPELLATE TEAM, Myron 

Moskovitz

KERSHAW, COOK & TALLEY, William A. 

Kershaw

SCHNEIDER WALLACE COTTRELL 

KONECKY, Amy Eskin

ESNER, CHANG & BOYER, Andrew N. 

Chang, Holly N. Boyer 

The California Chamber of Commerce, 

The Chamber of Commerce of the 

U.S.A., The Alliance for Automotive 

Innovation, The Washington Legal 

Foundation, Amici

DLA PIPER, Justin R. Sarno, Adam Pierson, 

Ilana H. Eisenstein, Ben C. Fabens-Lassen

Washington Legal Foundation, Amicus WASHINGTON LEGAL FOUNDATION, 

Cory L. Andrews

Pharmaceutical Research and 

Manufacturers of America 

(“PHRMA”), Amicus

COVINGTON & BURLING, Ashley M. 

Simonsen, Alice L. Phillips, Michael X. 

Imbroscio, Emily Ullman, Gregory L. 

Halperin

American Association for Justice and 

Consumer Attorneys of California, 

Amici

THE ARKIN LAW FIRM, Sharon J. Arkin

AMERICAN ASSOCIATION FOR JUSTICE, 

Jeffrey R. White
65

Product Liability Advisory Council, 

Inc., Amicus

BUCHALTER, Mary-Christine Sungaila, Paul 

A. Alarcon

Public Justice, Amicus PUBLIC JUSTICE, Karla Gilbride