Case Comment on Cloer v. HHS

Case Comment on the U.S. Court of Appeals for the Federal Circuit’s August 5, 2011 Decision in Cloer v. HHS

By Kim Mack Rosenberg, EBCALA Board Member

One of the most frequently criticized elements of the National Childhood Vaccine Injury Compensation Act, 42 USC §§300aa-1, et. seq. (the “1986 Act”), is its unusually restrictive statute of limitations, requiring an injured person to file his claim no later than 36 months from first symptom of illness, whether or not he is able attribute his injury to a vaccine during those three years.[1]  For injured parties who may be unable to connect the dots in that short period of time, the courthouse doors slam shut, and compensation is, for all intents and purposes, foreclosed. 

But could that short limitations period be extended by either the discovery rule – extending the time by which a party can file a legal claim until he discovers or should reasonably have discovered the suspected cause of his injury – or the doctrine of equitable tolling – which modifies the statute of limitations in cases of fraud, duress or similar circumstances? For answers to those questions, those following vaccine litigation have anxiously been awaiting the decision of the United States Court of Appeals for the Federal Circuit in Cloer v. Secretary of Health and Human Services (Docket No. 2009-5052). 

On August 5, 2011, the Cloer Court, in an 8-4 decision, answered those questions, rejecting wholesale any application of the discovery rule to VICP claims and, overruling Brice v. Secretary of Health and Human Services, 240 F.3d 1367 (Fed. Cir. 2001) (“Brice”), finding that equitable tolling could be applied only in certain extraordinary circumstances such as fraud or duress.  However, in the case before the Court, they refused to apply equitable tolling to Dr. Cloer’s claim, foreclosing her ability to obtain compensation for her vaccine-related injuries.[2]  As discussed below, the denial of equitable tolling in Dr. Cloer’s case demonstrates how few petitioners will be aided by that doctrine.

At its heart, the Cloer decision places form above substance and purported administrative ease above justice and fairness.  The decision fails to recognize the difficult reality of the administrative procedure that vaccine-injured individuals, unlike any other potential tort plaintiffs, are forced to accept.  To understand fully the impact of the Cloer decision, one must briefly examine what the 1986 Act intended to do and the reality of what it has created, and analyze the Court’s decision in that context.

The 1986 Act established the Vaccine Injury Compensation Program (the “VICP”) to, among other things, create a non-adversarial administrative forum “friendly” to those alleging vaccine injury by providing swift compensation without the adversarial environment and procedural complexities of courtroom litigation, which could delay claims for years or result in denial of compensation.  The reality of the VICP is quite different.  The lack of procedural safeguards is a severe detriment to the rights of VICP petitioners, who are deprived of the benefits of discovery and rules of evidence to assist them in obtaining support for their claims in what has become a generally unfriendly, highly adversarial forum.  As a result, compensation frequently is denied and, even where obtained, a settlement or decision may take years to reach, causing financial and emotional strain on petitioners and their families.[3]

It is against that backdrop that the Cloer decision should be analyzed.

Dr. Cloer received Hepatitis B vaccines in 1996 and 1997.  About one month after her final shot she experienced the first of what for many years would be fleeting symptoms of what was not diagnosed until 2003 as Multiple Sclerosis (“MS”).  She first posited a link between her MS and the Hep-B vaccines she received when she read an article in a scholarly medical journal in 2004.  Shortly thereafter, in October 2004, she reported her injury to the Vaccine Adverse Event Reporting System (“VAERS”) and filed a claim in the VICP in September 2005.  Her claim was rejected as untimely.

On appeal, Dr. Cloer argued, among other things, that the statute of limitations should not begin to run under the medical community recognizes the causal relationship between a vaccine and an injury, i.e., until it is understood that an injury is “vaccine-related.”  She also asked that the Court reconsider Brice and recognize equitable tolling under the 1986 Act. 

In rejecting her first argument, the Court noted that because a causal link has not been established between vaccines and the injuries (so-called Non-Table injuries) alleged by many claimants in the VICP, a significant number of petitioners would lack standing to bring a claim under Dr. Cloer’s theory.  Further, the Court stated that nothing in the 1986 Act would allow a cause of action to accrue, giving petitioners standing to sue, before the statute of limitations began to run.  The Court also noted that, at times, the first causal link between an injury and a vaccine is established in a VICP proceeding. 

In later proceedings before the Federal Circuit, Dr. Cloer rephrased her argument from medical “consensus” to “recognition” in the medical community of a link between a vaccine and an injury.  Based on this rephrased argument, the Court addressed whether a discovery rule should be applied to the 1986 Act, so that the statute of limitations would not begin to run until a petitioner knew or should have known the cause of her injury.  The Court rejected application of the discovery rule.  In particular, the Court rejected Dr. Cloer’s argument that, by using the term “vaccine-related injury,” the 1986 Act contained a discovery rule.  The Court also refused to read into the 1986 Act an implied discovery rule, finding that the “no-fault” statute “conveyed its refusal to permit an implied discovery rule.”  The Court found that the allegedly no-fault scheme under the 1986 Act was fundamentally different than the fault-based liability in state courts, most of which recognize some form of the discovery rule with respect to statutes of limitation, and that, assuming that Congress was aware of the state law systems and having rejected alternative statute of limitations proposals, Congress’s decision to adopt the limitations scheme that it “goes a long way to showing” its intent to not apply a discovery rule in the 1986 Act.

The Court, with blinders on, focused on what the VICP is “supposed” to be, rather than recognizing the shortcomings of the program in practice, and rejected the need for flexibility with respect to the statute of limitations.  The Court found that allowing plaintiffs to invoke the discovery rule would be “fundamentally incompatible” with the 1986 Act’s intention of creating an administratively streamlined procedure and that, in creating this administrative construct, Congress impliedly refused to adopt a discovery rule.  In particular, the Court failed to recognize that vaccine injuries may manifest years after vaccination and often have a gradual onset that may not be initially apparent even to a medical professional.  Thus, in denying petitioners the benefit of the discovery rule, the Cloer Court turned the 1986 Act’s “petitioner friendly” intention on its head, compounding the “unfriendly” reality of the VICP. 

With respect to the doctrine of equitable tolling, the Court revisited and overruled Brice, holding that equitable tolling could apply to the statute of limitations under the 1986 Act.  The Court rejected the U.S. government’s arguments against equitable tolling, finding that the government failed to adduce a “‘good reason to believe that Congress did not want the equitable tolling doctrine to apply.’”[4] 

However, in applying the equitable tolling analysis to Dr. Cloer’s case, the Court found her argument that it would be inequitable to apply the 36-month statute of limitations when she could not know or have known before 2004 of the link between her MS and the Hep-B vaccines she received in 1996 and 1997.  The Court noted that she did not argue that fraud or duress prevented her from timely filing her claim.  The Court instead understood Dr. Cloer to argue that it was inequitable to apply the statute of limitations to her claim because doing so would deprive her of the relief she sought.  The Court found this reason insufficient to toll the statute of limitations and suggested that applying the equitable tolling doctrine in this manner would be another way of applying the discovery rule under the auspices of a different doctrine.  Thus, the Court denied Dr. Cloer the benefits of equitable tolling.

Interestingly, in ruling that equitable tolling is available, the Court noted, in particular, that “[t]he only purpose of the statute of limitations in the Vaccine Act is to protect the government from stale or unduly delayed claims.”  The Court’s admission that the statute of limitations is not protective of petitioners’ interests in what is a system designed to make compensation generously available to victims of vaccine injury in and of itself calls into question whether the Court’s discovery rule conclusions are correct.

In sharp contrast to the majority, the dissent in Cloer found it “quite clear” that the 1986 Act “incorporates a discovery rule under which the limitations period does not begin to run until the claimant knew or should have known of a connection between the alleged injury and a vaccine.”  The dissent noted that, for example, in cases involving latent disease or medical malpractice, the discovery rule protects those who do not – and perhaps could not – know they are injured during the limitations period.  As noted above, many vaccine injuries are just the type of injury the discovery rule is designed to address. 

The dissent accuses the majority of “rewrit[ing]” the 1986 Act and misconstruing Congressional intent and instead reads the statute of limitations trigger in the 1986 Act as “the first event which would put the claimant on notice that a vaccine-related injury has occurred.”  The dissent urged that application of the discovery rule furthers the 1986 Act’s intent to provide compensation to vaccine-injured individuals and that, as remedial legislation, the 1986 Act should be liberally construed to afford relief.  The dissent recognized the VICP’s intent to be “more generous than the civil tort system” and demonstrated that the majority’s reading may render the 1986 Act “far less generous.” (Emphasis in the original)

In closing, the dissent summarized, in the context of Dr. Cloer’s claim, the unfairness to VICP petitioners and potential petitioners of the majority decision:

The injustice of the majority’s approach is amply demonstrated by the circumstances in this case. In Dr. Cloer’s case, there is no dispute that the first symptom or manifestation of injury occurred in May 1997 when she experienced a Lhermitte sign, which is recognized by the medical profession as a common symptom of MS. The government has submitted no evidence, however, that Dr. Cloer had reason to suspect a connection between [MS] and the Hepatitis B vaccine before 2004. Under the majority’s reading of the [1986] Act, the limitations period on Dr. Cloer’s claim began running on the date of her first symptom of MS, which occurred more than four years before her cause of action accrued. There is simply no indication that Congress intended that the limitations period begin before she had the information necessary to file a petition.  

Following the Supreme Court’s February 2011 decision in Bruesewitz v. Wyeth LLC, foreclosing access to civil courts for claims of vaccine design defect, the Cloer decision now prevents even more claimants from seeking relief for compensable vaccine-injuries.  While the Court recognized equitable tolling, few petitioners likely will be able to evidence fraud, duress or similar hardship in order to avail themselves of this doctrine.

[1] Under the 1986 Act’s statute of limitations, a party alleging a vaccine injury must file his petition no later than “36 months after the date of the occurrence of the first symptom or manifestation of onset” of the party’s vaccine-related injury. 42 USC §300aa-16(a)(2).

[2] Dr. Cloer was diagnosed with multiple sclerosis (“MS”), the first symptoms of which manifested in May 1997.  She received Hepatitis B vaccinations in 1996 and 1997 and filed a claim with the VICP in 2005 alleging that her MS was caused by those vaccines.

[3] For further analysis of the VICP, readers should consult the critique of the VICP authored by EBCALA Executive Director Mary Holland and Board Member Robert Krakow found here and a review of certain compensated VICP cases, and related materials, found here.

[4] Citing United States v. Brockamp, 519 U.S. 347, 350 (1997).