NEW YORK'S blood shield statute bars product liability lawsuits not only against laboratories that supply blood and the hospitals and doctors who transfuse patients, but also against "fractionators," which process and distribute blood products, a Manhattan Supreme Court justice has ruled in statewide litigation over allegedly contaminated blood.

In dismissing strict liability and breach of warranty causes of action, Justice Karla Moskowitz said that Public Health Law §580(4) does not only regulate clinical laboratories and blood banks, but also the fractionators.

She reasoned that Article 5, Title 5 of the state's Public Health Law, despite its narrow heading, "Laboratory Services," reaches beyond labs.

In Matter of Blood Factor Litigation, 750000/99, 23 plaintiffs alleged that they suffered injury from exposure to blood products and derivatives infected with viruses, including human immunodeficiency virus (HIV), which causes acquired immune deficiency syndrome (AIDS).

The plaintiffs sued several defendants, basing some causes of action on the defendants' duties as manufacturers or sellers of defective products.

Asking the court to strike the strict liability and breach of warranty actions were six "fractionator defendants," which process and distribute blood clotting factor, which is used to treat hemophiliacs.

The defendants invoked Public Health Law §580(4), which provides that collection, processing, distribution or use of blood, blood components or derivatives for the treatment of disease is "a public health service" and not "a sale."

The blood shield law has the effect of taking blood products out of the realm of products liability suits, in which strict liability and breach of warranty come into play.

Providers of blood products may be sued for negligence, but not for defective product design.

The question was whether the statute extended such protection beyond blood banks, and health care professionals who administer the products.

Justice Moskowitz held, in a matter that has not yet been decided by state appeals courts, that the manufacture and sale of clotting factor is included under the state's blood shield law.

"[M]anufacture and sale of the clotting factors allegedly involved in this case are an integral part of the collection, processing, storage, distribution or use of blood or a blood derivative," Justice Moskowitz concluded. Public Health Law §580(4) therefore applies to fractionators, she said.

In a decision handed down in September, Justice Moskowitz prevented one of the 23 plaintiffs from amending her complaint to include strict liability and breach of warranty claims against one of the fractionator defendants.

In that case, A.C. v. Armour Pharmaceutical Co., 129558/94, the court said that blood shield statute barred the new theories since they are based on products liability, which holds the defendant responsible for manufacturing and selling a defective product.

Justice Moskowitz reaffirmed her September ruling in the current decision, but went further in explaining her reasoning.

If the Public Health Law were limited to regulation of laboratory services, she said, there would be no protections for transfusion doctors and hospitals. But those protections were "clearly intended" by the Legislature, Justice Moskowitz continued.

And in 1992, the New York Court of Appeals, while not considering fractionators, stated broadly in Mondello v. New York Blood Center, 80 NY2d 219, that Public Health Law §580(4) suspends the common application of strict liability precepts and remedies in cases of the collection, processing and distribution of human blood products.

Other State Laws

Moreover, in the consolidated case she dismissed already pleaded allegations of strict liability and breach of warranty in a way that reaches all 23 cases.

Justice Moskowitz rejected plaintiffs' invitation to agree with decisions from three other states allowing products liability claims against fractionators.

Courts in Indiana, Maryland and Washington states were interpreting blood shield statutes that differed significantly from New York's in important ways, she explained. Maryland, for instance, created an exception to allow strict liability suits against blood service providers for exposure to AIDS and HIV.

All of the blood factor litigation has been consolidated before Justice Moskowitz, who is hearing cases that originated from Manhattan to Erie County.

Strict liability and breach of warranty claims were also dismissed against the New York Blood Center, a blood bank clearly within the ambit of the Public Health Law, the court said.