Who: Isolagen Europe Ltd, Kathleen Webster and Others, Mark Liddington & Others
Where: Court of Appeal, Royal Courts of Justice, London
When: April 2014
Law stated as at: 9 April 2014
What happened: Patients underwent skin rejuvenation treatment at cosmetic intervention clinics using a third party process available from Isolagen Europe Ltd (“IEL”). When offering the treatment, clinicians handed over an IEL brochure describing the process (“Brochure”).
The treatment was substantially more expensive than other skin rejuvenating therapies on the market such as Botox or Bovine Collagen.
Concerns arose later that the Brochure was misleading. Following IEL going into administration, various patients sued the clinicians for misrepresentation arguing that by handing over the Brochure without disclaimer, the clinicians adopted the IEL misrepresentations and were therefore responsible for them at law.
At first instance, the Manchester County Court found for the patients, but the clinicians appealed and the Court of Appeal handed down its judgment on 9 April 2014.
Concerns regarding bovine traces in injections
The alleged misrepresentation concerned the condition of matter for injection into patients as part of the Isolagen treatment (“Matter”). This was sent to clinicians by IEL after a skin sample from the patient had been sent to IEL and was used to create the Matter.
The Isolagen process involved culturing of matter developed from the skin tissue using foetal calf serum (“FCS”). The Brochure used language suggesting that when it was injected into the patient, the Matter was completely free of FCS.
For example: “a solution using only your cells” and “Unlike other collagen development companies Isolagen uses only the patient’s unique live cells to produce the patient’s own collagen.”
A number of patients later discovered that the Matter may well have contained traces of FCS and were concerned about possible allergic reactions, hence the subsequent proceedings.
On appeal, the court rejected the clinicians’ arguments that they were not responsible to the patients (“Claimants”) for the accuracy of the Brochure.
“Stark imbalance of knowledge”
The appeal judges held that there was a “stark imbalance” of knowledge between the parties and the clinicians were offering both a product and a service, with the relationship that of clinician and patient as well as vendor and purchaser.
Furthermore and crucially, when handing over the Brochure, the clinicians did not stipulate any disclaimer or express any reservations about the Brochure’s accuracy.
In these circumstances it was held, applying the established test for such cases, that a reasonable person standing in the shoes of any of the Claimants would conclude that the clinician was adopting the contents of the Brochure being handed over.
For the situation to be otherwise, the appeal court said, the clinician would have had to say something like “I have no knowledge or belief as to the accuracy or otherwise of the contents of this brochure.” If this was regarded as commercially unattractive, then, said Lord Justice Jackson, there may be an arguable defence if something like the following was said:
“This is what the manufacturer says. They are a reputable company. Although I have no direct knowledge of these matters and cannot confirm the details, I believe that the brochure is accurate.”
As it was, without any disclaimer at all, the clinicians were held liable.
“Insignificant error” appeal ground also fails
An additional ground of appeal, that the error was insignificant, was also rejected. Even though it appeared on the evidence that only small traces of FCS were likely to be present in the Matter, expert testimony indicated that even such traces may well induce an allergic reaction. Lord Justice Jackson added pungently:
“If patients were told the true position..this may well have affected their decision to go ahead. For some people the idea of having extraneous material injected into one’s face is off-putting. I could not say such an attitude is unreasonable.”
Accordingly the clinicians’ appeal was dismissed.
Why this matters:
Reported cases are few and far between that underline the risk of misleading promotional material leading to potential civil liability for misrepresentation as well as criminal liability under unfair commercial practices regulations. This concise and authoritative judgment is therefore very welcome.
As ever the case turns on its own facts and the “clinician/patient” relationship clearly had a key influence, together with the finding of a “stark imbalance” in knowledge between trader and consumer.
However the judgment emphasises traders’ potential liability for third party promotional material unless care is taken to accompany it with a suitable disclaimer.
