Skip to main content
SpringerLink
Log in

Fraudulent Misrepresentation and Fraudulent Concealment in Products Liability in Tort Law in Canada: The Special Relationship Between Drug Companies and Consumers in the Context of the Fraudulent Misrepresentation and Fraudulent Concealment of Data

  • Chapter
  • First Online:
Integrity, Transparency and Corruption in Healthcare & Research on Health, Volume I

  • 322 Accesses

Abstract

The legal concept of the “special relationship”, arising in the areas of negligence and intentional torts, has been afforded little attention in products liability cases in Canadian law. The special relationship has been applied in cases wherein plaintiffs have suffered damages in the course of their relationships of reliance with defendants. Although the special relationship does not amount to a fiduciary relationship, the special relationship triggers a positive duty owed to the plaintiff by the defendant, where the defendant makes false or misleading representations on which plaintiffs rely. Issues of limitation period expiry and discoverability are also relevant in cases, where the intentional tort of fraudulent misrepresentation of a material fact relating to known risks prevent consumers from identifying their potential for causes of action prior to the expiry of the typical 2-year limitation period. For instance, in cases where data is withheld, misrepresented or mischaracterized, and a consumer can make a products liability claim in negligence or intentional torts, the special relationship is a factor in the analysis of responsibility, duty and relationship between the consumer and the defendant. In these cases, a plaintiff may advance the equitable doctrine of fraudulent concealment. To successfully establish fraudulent concealment in equity, one requirement is that the plaintiff must establish a special relationship between the plaintiff(s) and the defendant. Both defining and establishing the special relationship in law will likely be challenging owing to the absence of a clear definition of what constitutes a special relationship in Canadian case law and legislation, in addition to limited literature, interpreting the criteria that must be satisfied to establish the special relationship. By providing an analysis of the legal test to establish the special relationship, related case law, primary documents and secondary research, as well as a case study to which this analysis may apply, this paper provides a thought experiment of a framework and method by which a special relationship can be established in products liability cases.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
eBook
USD 16.99
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD 109.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info
Hardcover Book
USD 109.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

References

  • Abramson, J., & Starfield, B. (2005). The effect of conflict of interest on biomedical research and clinical practice guidelines: Can we trust the evidence in evidence-based medicine? Journal of the American Board of Family Medicine, 18(5), 414–418.

    Article  Google Scholar 

  • American Law Institute. Restatement (Third) of Agency (2006).

    Google Scholar 

  • Angell, M. (2008). Industry-sponsored clinical research: A broken system. Journal of the American Medical Association, 300(9), 1069–1071.

    Article  Google Scholar 

  • Aursnes, I., & Klemp Gjertsen, M. (2008). Common adverse events associated with an SSRI: Meta analysis of early paroxetine data. Pharmacoepidemiology and Drug Safety, 17, 707–713.

    Article  Google Scholar 

  • Aursnes, I., Tvete, I. F., Gassemyr, J., & Natvig, B. (2005). Suicide attempts in clinical trials with paroxetine randomised against placebo. BMC Medicine, 3(14), 5.

    Google Scholar 

  • Bass, A. (2008). Side Effects: A prosecutor, a whistleblower, and a bestselling antidepressant on trial. Algonquin Books. Chapel Hill, North Carolina: Algonquin Books of Chapel Hill.

    Google Scholar 

  • Baum Hedlund Aristei Goldman PC. (2009). GSK’s knowledge of the association between Paxil and an increased risk of suicidality in adults. Retrieved from https://baumhedlundlaw.com/pdf/2-Forst-Pltfs-Add-Facts-Preemption_Redacted.pdf.

  • Bazley v Curry, (1999) 2 SCR 534.

    Google Scholar 

  • Beaman v ARTS Ltd., (1949) 1 KB 550.

    Google Scholar 

  • Bekelman, J. E., Li, Y., & Gross, C. P. (2003). Scope and impact of financial conflicts of interest in biomedical research: a systematic review. Journal of the American Medical Association, 289(4), 454–465.

    Article  Google Scholar 

  • Bell, N., Connor Gorber, S., Tonelli, M., Pottie, K., Singh, H., Joffres, M., et al. (2013). From ABCs to GRADE: Canadian task force on preventive health care’s new rating system for clinical practice guidelines. Canadian Family Physician, 59, 1282–1289.

    Google Scholar 

  • Bero, L., Oostvogel, F., Bacchetti, P., & Lee, K. (2007). Factors associated with findings of published trials of drug-drug comparisons: Why some statins appear more efficacious than others. PLoS Medicine, 4(6), 1001–1010.

    Article  Google Scholar 

  • BG Checo International Ltd. v British Columbia Hydro and Power Authority, (1993) 1 SCR 12.

    Google Scholar 

  • BMJ. (2013). Restoring invisible and abandoned trials: A call for people to publish the findings. BMJ, 346, f4223.

    Article  Google Scholar 

  • Brix Bindslev, J., Schroll, J., Gotzsche, P., & Lundh, A. (2013). Underreporting of conflicts of interest in clinical practice guidelines: Cross sectional study. BMC Medical Ethics, 14(19), 1–7.

    Google Scholar 

  • Campbell, E., Rao, S., DesRoches, C., Lezzoni, L., Vogeli, C., Bolcic-Jankovic, D., et al. (2010). Physician professionalism and changes in physician-industry relationships from 2004–2009. Archives of Internal Medicine, 170(20), 1820–1826.

    Article  Google Scholar 

  • Choc v Hudbay Minerals Inc., (2013) ONSC 1414.

    Google Scholar 

  • Chopra, S. (2003). Industry funding of clinical trials: Benefit or bias? Journal of the American Medical Association, 290(1), 113–114.

    Article  Google Scholar 

  • Choudhry, N. K., Stelfox, H. T., & Detsky, A. S. (2002). Relationships between authors of clinical practice guidelines and the pharmaceutical industry. Journal of the American Medical Association, 287(5), 612–617.

    Article  Google Scholar 

  • Cosgrove, L., Bursztajn, H. J., Krimsky, S., Anaya, M., & Walker, J. (2009). Conflicts of interest and disclosure in the American psychiatric association’s clinical practice guidelines. Psychotherapy and Psychosomatics, 78, 228–232.

    Article  Google Scholar 

  • Crocker v Sundance Northwest Resorts Ltd., (1988) 1 SCR 1186.

    Google Scholar 

  • Dinnes, J., Hewison, J., Altman, D., & Deeks, J. (2012). The basis for monitoring strategies in clinical practice guidelines: A case study of prostate-specific antigen for monitoring prostate cancer. Canadian Medical Association Journal, 184(2), 169–177.

    Article  Google Scholar 

  • Donoghue v Stevenson, (1932) AC 562.

    Google Scholar 

  • DrugWatch. (2015). Big Pharma’s role in clinical trials. Retrieved March 31, 2016, from https://www.drugwatch.com/manufacturer/clinical-trials-and-hidden-data/.

  • Elliott, C. (2010). White coat black hat: Adventures on the dark side of medicine. Boston: Beacon Press.

    Google Scholar 

  • Elliott, C. (2011). How the FDA got the Markingson case wrong. Retrieved March 31, 2016, from http://www.thehastingscenter.org/Bioethicsforum/Post.aspx?id=5147.

  • Elliott, C. (2012). Dan Markingson investigation: A referenced summary of the Dan Markingson case. Retrieved May 28, 2015, from markingson.blogspot.ca.

    Google Scholar 

  • Elliott, C. (2014). Psychiatric research abuse at the University of Minnesota. Turkish Journal of Bioethics, 1(1), 38–43. Retrieved from http://www.journalagent.com/tjob/pdfs/TJOB_1_1_38_43.pdf.

  • Enyinda, I. C., Briggs, C., & Bachkar, K. (2009). Managing risk in pharmaceutical global supply chain outsourcing: Applying analytical hierarchy process model. Proceedings of ASBBS, 16(1).

    Google Scholar 

  • Friedberg, M., Saffran, B., Stinson, T., Nelson, W., & Bennett, C. (1999). Evaluation of conflict of interest in economic analyses of new drugs used in oncology. Journal of the American Medical Association, 282(15), 1453–1457.

    Article  Google Scholar 

  • Fugh-Berman, A., & Dodgson, S. (2008). Ethical considerations of publication planning in the pharmaceutical industry. Open Medicine, 2(4), 121–124.

    Google Scholar 

  • Gagnon, M. (2009). The nature of capital in the knowledge-based economy: The case of the global pharmaceutical industry. York University.

    Google Scholar 

  • Giroux Estate v Trillium Health Centre, (2005). CanLII 1488 (ON CA).

    Google Scholar 

  • Graham, D. J. (2004). Testimony of David J. Graham, MD, MPH, November 18, 2004.

    Google Scholar 

  • Grande, D., Frosch, D. L., Perkins, A. W., & Kahn, B. E. (2009). Effect of exposure to small pharmaceutical promotional items on treatment preferences. JAMA Internal Medicine, 169(9), 887–893.

    Google Scholar 

  • Grochowski Jones, R., & Ornstein, C. (2016). Matching industry payments to Medicare prescribing patterns. ProPublica.

    Google Scholar 

  • Guerin v R, (1984) 2 SCR 335.

    Google Scholar 

  • Guyatt, G., Akl, E. A., Hirsh, J., Kearon, C., Crowther, M., Gutterman, D., ... Schunemann, H. (2010). The vexing problem of guidelines and conflict of interest: a potential solution. Annals of Internal Medicine, 152(11), 738–741. Retrived from https://annals.org/aim/fullarticle/745809.

  • Harrison, D. (2013). The Law of Product Warnings and Recalls in Canada. Toronto: LexisNexis Canada.

    Google Scholar 

  • Healy, D. (2012). Pharmageddon. Berkeley/Los Angeles: University of California Press.

    Google Scholar 

  • Hollis v Dow Corning Corp., (1995) 4 SCR 634.

    Google Scholar 

  • Hugos, M. (2011). Essentials of supply chain management. Hoboken: Wiley.

    Book  Google Scholar 

  • IFPMA and ICH. (2013). MedDRA term selection: Points to consider: ICH-endorsed guide for MedDRA users.

    Google Scholar 

  • Institute of Medicine [IOM]. (2011). Clinical practice guidelines we can trust. In R. Graham, M. Mancher, D. Miller Wolman, S. Greenfield, & E. Steinberg (Eds.), Washington, D.C.: The National Academies Press.

    Google Scholar 

  • Keller, M. B., Ryan, N. D., Strober, M., Klein, R. G., Kutcher, S. P., Birmaher, B., McCafferty, J. P. (2001). Efficacy of paroxetine in the treatment of adolescent major depression: A randomized, controlled trial. Journal of the American Academy of Child & Adolescent Psychiatry, 40(7), 762–772.

    Google Scholar 

  • Kitchen v Royal Air Force Association, (1958) 1 WLR 563.

    Google Scholar 

  • Kondro, W. (2004). Drug company experts advised staff to withhold data about SSRI use in children. PLOS Medicine, 170(5), 783.

    Google Scholar 

  • Kung, J., Miller, R. R., & Mackowiak, P. A. (2012). Failure of clinical practice guidelines to meet Institute of Medicine standards: Two more decades of little, if any, progress. Archives of Internal Medicine, 172(21), 1628–1633.

    Article  Google Scholar 

  • Lac Minerals Ltd. v International Corona Resources Ltd., (1989) 2 SCR 574.

    Google Scholar 

  • Laden, S. K., & Romankiewicz, J. A. (April 3, 1998). Adolescent depression study 329: proposal for a journal article. POGO Investigation on Ghostwriting Collection. Unknown. https://www.industrydocuments.ucsf.edu/docs/npfw0217.

  • Lambert v Lastoplex Chemicals, (1972) SCR 569.

    Google Scholar 

  • Langer, T., Conrad, S., Fishman, L., Gerken, M., Schwarz, S., Weikert, B., Weinbrenner, S. (2012). Conflicts of interest among authors of medical guidelines: An analysis of guidelines produced by German specialist societies. Deutsches Ärzteblatt International, 109(48), 836–842.

    Google Scholar 

  • Le Noury, J., Nardo, J. M., Healy, D., Jureidini, J., Raven, M., Tufanaru, C., et al. (2015a). Appendix 3: Supplementary information on suicidal and self-injurious behaviours in study 329 [posted as supplied by author]. The BMJ, 351, h4320.

    Article  Google Scholar 

  • Le Noury, J., Nardo, J. M., Healy, D., Jureidini, J., Raven, M., Tufanaru, C., et al. (2015b). Restoring Study 329: Efficacy and harms of paroxetine and imipramine in treatment of major depression in adolescence. The BMJ, 351, h4320.

    Article  Google Scholar 

  • Lexchin, J. (2012). Those who have the gold make the evidence: how the pharmaceutical industry biases the outcomes of clinical trials of medications. Science and Engineering Ethics, 18(2), 247–261.

    Article  Google Scholar 

  • Lexchin, J. (2018). Quality of evidence considered by Health Canada in granting full market authorisation to new drugs with a conditional approval: A retrospective cohort study. British Medical Journal Open, 8(4), e020377.

    Google Scholar 

  • Lexchin, J., Bero, L., Djulbegovic, B., & Clark, O. (2003). Pharmaceutical industry sponsorship and research outcome and quality. British Medical Journal, 326, 1167–1170.

    Article  Google Scholar 

  • Limitations Act, (2002), SO 2002, c. 24.

    Google Scholar 

  • Linden, A. M. (1982). Canadian tort law (2nd ed.). Toronto: Butterworth & Company (Canada).

    Google Scholar 

  • Lundh, A., Lexchin, J., Mintzes, B., Schroll, J., & Bero, L. (2017). Industry sponsorship and research outcome. Cochrane Database of Systematic Reviews.

    Google Scholar 

  • Lundh, A., Sismondo, S., Lexchin, J., Busuioc, O., & Bero, L. (2012). Industry sponsorship and research outcome (review). Cochrane Database of Systematic Reviews, 12(MR000033).

    Google Scholar 

  • McHenry, L. B., & Jureidini, J. N. (2008). Industry-sponsored ghostwriting in clinical trial reporting: A case study. Accountability in Research: Policies and Quality Assurance, 15(3), 152–167.

    Article  Google Scholar 

  • McInerney v MacDonald, (1992) 2 SCR 138.

    Google Scholar 

  • Mendelson, T. B., Meltzer, M., Campbell, E. G., Caplan, A. L., & Kirkpatrick, J. N. (2011). Conflicts of interest in cardiovascular clinical practice guidelines. Archives of Internal Medicine, 171(6), 577–585.

    Article  Google Scholar 

  • Mirowski, P. (2001). Re-engineering scientific credit in the era of the globalized information economy. First Monday, 6(12).

    Google Scholar 

  • Mirowski, P. (2011). Science-mart: Privatizing American science. Cambridge, MA: Harvard University Press.

    Book  Google Scholar 

  • Mirowski, P., & Van Horne, R. (2005). The contract research organization and the commercialization of scientific research. Social Studies of Science, 35(4), 503–548.

    Article  Google Scholar 

  • M(K) v M(H), (1992) 3 SCR 6.

    Google Scholar 

  • Moffatt, B., & Elliott, C. (2007). Ghost marketing: Pharmaceutical companies and ghostwritten journal articles. Perspectives in Biology and Medicine, 50(1), 18–31.

    Article  Google Scholar 

  • Moynihan, R. (2003). Who pays for the pizza? Redefining the relationships between doctors and drug companies. 1: Entanglement. British Medical Journal, 326(1189–1192).

    Google Scholar 

  • Neuman, J., Korenstein, D., Ross, J., & Keyhani, S. (2011). Prevalence of financial conflicts of interest among panel members producing clinical practice guidelines in Canada and United States: Cross sectional study. British Medical Journal, 343, d5621.

    Article  Google Scholar 

  • Nicholls, C. C. (2005). Corporate Law. Toronto: Edmond Montgomery Publications Limited.

    Google Scholar 

  • Norberg v Wynrib, (1992) 2 SCR 226.

    Google Scholar 

  • Norris, S. L., Holmer, H. K., Ogden, L. A., Burda, B. U., & Fu, R. (2013). Conflicts of interest among authors of clinical practice guidelines for glycemic control in type 2 diabetes mellitus. PLoS ONE, 8(10), e75284.

    Article  Google Scholar 

  • Orlowski, J., & Wateska, L. (1992). The effects of pharmaceutical firm enticements on physician prescribing patterns: There’s no such thing as a free lunch. Chest, 102(1), 270–273.

    Article  Google Scholar 

  • Osborne, P. H. (2015). The law of torts (5th ed.). Toronto: Irwin Law Inc.

    Google Scholar 

  • Papanikolaou, G. N., Baltogianni, M. S., Contopoulos-Ioannidis, D. G., Haidich, A.-B., Giannakakis, I. A., & Ioannidis, J. P. (2001). Reporting of conflicts of interest in guidelines of preventive and therapeutic interventions. BMC Medical Research Methodology, 1(3).

    Google Scholar 

  • Peek v Gurney, (1873) LR 6 HL 377.

    Google Scholar 

  • Peoples Department Stores Inc. (Trustee of) v Wise, (2004) SCC 68 (CanLII), 3 SCR 461.

    Google Scholar 

  • Queen v Cognos Inc., (1993) 1 SCR 87.

    Google Scholar 

  • Rochon, P. A., Gurwitz, J. H., Simms, R. W., Fortin, P. R., Felson, D. T., Minaker, K. L., et al. (1994). A study of manufacturer-supported trials of nonsteroidal antiinflammatory drugs in the treatment of arthritis. Archives of Internal Medicine, 154(2), 157–163.

    Article  Google Scholar 

  • Ross, J., Hill, K., Egilman, D., & Krumholz, H. (2008). Guest authorship and ghostwriting in publications related to rofecoxib: A case study of industry documents from rofecoxib litigation. Journal of the American Medical Association, 299(15), 1800–1812.

    Article  Google Scholar 

  • Roulston v McKenny, (2016) ONSC 2377.

    Google Scholar 

  • Schott, G., Pachl, H., Limbach, U., Gundert-Remy, U., Lieb, K., & Ludwig, W.-D. (2010). The financing of drug trials by pharmaceutical companies and its consequences: Part 2: A qualitative, systematic review of the literature on possible influences on authorship, access to trial data, and trial registration and publication. Deutsches Ärzteblatt International, 107(17), 295–301.

    Google Scholar 

  • Shnier, A., Lexchin, J., Romero, M., & Brown, K. (2016). Reporting of financial conflicts of interest in clinical practice guidelines: a case study analysis of guidelines from the Canadian Medical Association Infobase. BMC Health Services Research, 16, 383.

    Google Scholar 

  • Sismondo, S. (2003). An introduction to science and technology studies. Malden, Massachusetts: Wiley-Blackwell.

    Google Scholar 

  • Sismondo, S. (2007). Ghost management: how much of the medical literature is shaped behind the scenes by the pharmaceutical industry? PLoS Medicine, 4(9), 1429–1433.

    Article  Google Scholar 

  • Sismondo, S. (2008). Pharmaceutical company funding and its consequences: a qualitative systematic review. Contemporary Clinical Trials, 29(2), 109–113.

    Article  Google Scholar 

  • Sismondo, S. (2009). Ghosts in the machine. Social Studies of Science, 39, 109–133.

    Google Scholar 

  • Smith, R. (2005). Medical journals are an extension of the marketing arm of pharmaceutical companies. PLoS Medicine, 2(5), 364–366.

    Article  Google Scholar 

  • Spielmans, G., & Parry, P. (2010). From evidence-based medicine to marketing-based medicine: evidence from internal industry documents. Journal of Bioethical Inquiry, 7(1), 13–29.

    Article  Google Scholar 

  • Spurling, G., Mansfield, P., Montgomery, B., Lexchin, J., Doust, J., Othman, N., et al. (2010). Information from pharmaceutical companies and the quality, quantity, and cost of physicians’ prescribing: A systematic review. PLoS Medicine, 7(10), e1000352.

    Article  Google Scholar 

  • Stelfox, H. T., Chua, G., O’Rourke, K., & Detsky, A. S. (1998). Conflict of interest in the debate over calcium-channel antagonists. New England Journal of Medicine, 338, 101–106.

    Article  Google Scholar 

  • Stewart v Pettie, (1995) 1 SCR 131.

    Google Scholar 

  • Stikeman Elliott LLP. (n.d.). Overview of Product Liability Law. In The law of product warnings and recalls in Canada. Retrieved from https://www.stikeman.com/-/media/files/kh-blog-resources/product-liability/lawproductwarningsrecallsch1.ashx.

  • Symm, B., Averitt, M., Forjuoh, S., & Preece, C. (2006). Effects of using free sample medications on the prescribing practices of family physicians. Journal of the American Board of Family Medicine, 19(5), 443–449.

    Article  Google Scholar 

  • The United States Department of Justice. (2012). GlaxoSmithKline to plead guilty and pay $3 billion to resolve fraud allegations and failure to report safety data. Retrieved from https://www.justice.gov/opa/pr/glaxosmithkline-plead-guilty-and-pay-3-billion-resolve-fraud-allegations-and-failure-report.

  • Tyler, B. J., & Cooper, R. A. (1997). Blinded by the hype: Shifting the burden when manufacturers engage in direct to consumer advertising of prescription drugs. Vermont Law Review, 1073, 1075.

    Google Scholar 

  • World Medical Association. (2013). WMA Declaration of Helsinki—Ethical principles for medical research involving human subjects. Report. Retrieved from https://www.wma.net/policies-post/wma-declaration-of-helsinki-ethical-principles-for-medical-research-involving-human-subjects/%3E.

  • Yeh, J., Franklin, J., Avorn, J., Landon, J., & Kesselheim, A. (2016). Association of industry payments to physicians with the prescribing of brand-name statins in Massachusetts. Journal of the American Medical Association Internal Medicine, (online first).

    Google Scholar 

  • Zinner, D., Bolcic-Jankovic, D., Clarridge, B., Blumenthal, D., & Campbell, E. (2009). Participation of academic scientists in relationships with industry. Health Affairs, 28(6), 1814–1825.

    Article  Google Scholar 

Download references

Acknowledgements

I would like to thank Dr. Philip Girard, professor and legal scholar at Osgoode Hall Law School in Toronto, Canada, for his helpful comments on a draft of this chapter.

Author information

Authors and Affiliations

  1. School of Health Policy & Management, 4700 Keele St, Toronto, ON, M3J 1P3, Canada

    Adrienne Shnier

Authors
  1. Adrienne Shnier
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Adrienne Shnier .

Editor information

Editors and Affiliations

  1. Trakya University, Edirne, Turkey

    Kıymet Tunca Çalıyurt

Appendix 9.1. Proposal to SmithKline Beecham for a Journal Article by Scientific Therapeutics Information, Inc.

Laden, SK; Romankiewicz, JA. Adolescent Depression Study 329: Proposal for a Journal Article. 1998 April 03. POGO Investigation on Ghostwriting Collection. Unknown. https://www.industrydocuments.ucsf.edu/docs/npfw0217.

Appendix 9.1. Proposal to SmithKline Beecham for a Journal Article by Scientific Therapeutics Information, Inc.

figure a
figure b
figure c
figure d
figure e
figure f
figure g
figure h
figure i
figure j
figure k
figure l

Rights and permissions

Reprints and permissions

Copyright information

© 2020 Springer Nature Singapore Pte Ltd.

About this chapter

Check for updates. Verify currency and authenticity via CrossMark

Cite this chapter

Shnier, A. (2020). Fraudulent Misrepresentation and Fraudulent Concealment in Products Liability in Tort Law in Canada: The Special Relationship Between Drug Companies and Consumers in the Context of the Fraudulent Misrepresentation and Fraudulent Concealment of Data. In: Çalıyurt, K. (eds) Integrity, Transparency and Corruption in Healthcare & Research on Health, Volume I. Accounting, Finance, Sustainability, Governance & Fraud: Theory and Application. Springer, Singapore. https://doi.org/10.1007/978-981-15-1424-1_9

Download citation

Publish with us

Policies and ethics

Search

Navigation