Medical Device and Drug Theft: An Emerging Source of Property & Products Liability for the Medtech Industry

?Both FDA and industry groups have identified the theft of medtech products as an emerging threat to public health. Likewise, the theft of these products is an emerging source of liability for the companies that manufacture and distribute them. Learn more about theft and how it is impacting the medtech industry. 

Why your product is vulnerable to theft during transit and tips for minimizing cargo theft; andStrategies for maintaining control of foreign suppliers and thereby minimizing product liability risk.Joseph A. Coray is the Vice President and Leader of The Hartford's Technology & Life Science Practice and Marine Practice.  He is responsible for all execution activities of the two groups, including overseeing field sales, underwriting and strategy for The Hartford's insurance work for biotechnology, medical technology, and pharmaceutical industries.Joe joined The Hartford in 2005 and has been in the insurance industry since 1987. He has a bachelor's degree from Saint Francis University, and master's degree from St. Bernard's Institute. He has earned Associate in Insurance Management designation from the Insurance Institute, and is certified Six Sigma Green Belt. Sara E Dyson, Esq. is the Assistant Vice President of Loss Control for the Medmarc Insurance Group. Her primary responsibility is to develop products and services to assist companies control products liability risks, losses, and associated costs.In 2012, Sara was invited to join the Health Sciences Council for Underwriter's Laboratory (UL). She will advise UL on safety trends for medical devices.Sara received her law degree from the University of Wisconsin Law School and is a member of the Wisconsin and Virginia Bar Associations. She is also a graduate of the University of Michigan, where she received a bachelor's degree.
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The Origins of Products Liability

Products liability is one of the most important U.S. legal developments in the last 100 years for numerous people and entities:  consumers, product-users including hospitals and health care practitioners, manufacturers and others who produce and sell products, government regulators, insurance companies who insure the defendants in these claims and lawsuits, and, of course, lawyers for the plaintiffs and defendants.  This liability has bankrupted manufacturers and insurance companies, caused manufacturers to stop making and selling certain products, and created entire industries of those who seek compensation for injuries and loss, those who seek to make products safer, and those who seek to make money prosecuting or defending the parties in these claims and lawsuits. 

Products liability is the liability of someone in the chain of production or chain of distribution for personal injury, property damage or economic loss arising out of the purchase and use of a product.  It includes as “users” patients, even though a health care institution or professional purchased the product and the health care professional is actually using the product on the patient. 

Generally, product-users could not sue manufacturers in the 1800s and early 1900s.  The reason is that the law only allowed consumers to sue the party from whom they purchased the product.  This usually was a retailer or dealer and not the manufacturer of the product.  The law developed in this way to insulate the manufacturer from liability so that they could be free to innovate and develop products without a significant risk of legal liability.

The law also protected manufacturers by requiring the injured party to prove negligence or fault in order to recover.  That is, they had to prove specifically which employee of the manufacturer was at fault and how they caused the problem.  This was difficult in many situations because it was very difficult for the injured party to figure out what happened and who did it.  This is particularly true as manufacturing became more complex in the latter part of the 1800s and into the early 1900s.

The legal concept of negligence, which has been in existence for hundreds of years, is evaluated by weighing three variables:  (1) the probability that injury would result from the manufacturer’s conduct; (2) the gravity of the harm that could be expected to result should injury occur; and (3) the burden of taking adequate precautions to avoid or minimize the injury.

In other words, if the probability of harm and the gravity of the harm are greater than the burden of taking precautions to reduce the risk, then the manufacturer could be deemed negligent if they do not minimize the risk.  In essence, the manufacture is negligent if the manufacturer failed to exercise reasonable care in manufacturing its product and this failure was the proximate cause of the injury.

In negligence cases, the injured party traditionally had to prove that: there was a defect in the product that caused plaintiff’s harm, the product was defective when it left the hands of the manufacturer or product seller, and that the defect was brought about through the defendant’s negligence.

The courts began to believe in the early 1900s that it was very difficult for the plaintiff to prove the last requirement— specifically how the defect came about.  How could a plaintiff prove who forgot to tighten a nut on a car’s tire and caused the tire to fall off?  As the manufacturing process became more complex, the courts became more liberal with the proof required for negligence.

Courts began to allow juries to “infer” that a product was negligently made if there was no other cause for it and the product was in the control of the manufacturer or seller until sale. This inference became the foundation of “strict liability.”  In addition, the courts began to apply “strict liability” to cases involving food and beverage where it was virtually impossible to prove how the foreign matter got into that food or beverage.

Finally, in the 1960s, strict liability was adopted for any product, not just food and beverages.  What strict liability did was eliminate the third requirement of proof for negligence.  No longer did the plaintiff have to prove negligence and who was responsible for it.  All they had to prove was that there was a defect and that the defect was in existence at the time the product left the manufacturers or sellers control and the defect caused the injury.

Under strict liability, the injured party did not have to prove fault or negligence and the manufacturer was liable even if their quality control and manufacturing procedures were reasonable and not negligent.  In other words, even if they did not do a bad job of manufacturing the product, the product turned out defective and dangerous and it injured a consumer.

The adoption of strict liability started an explosion of claims and lawsuits because consumers began to understand that they could more easily recover against manufacturers and, most importantly, they could find lawyers who were willing to take their cases and sue.

The number of lawsuits significantly expanded in the 1970s and 1980s.  Also, the theories of liability significantly expanded.  Strict liability, which was originally intended to apply only to manufacturing defects, began to be applied to defects in design and warnings and instructions.  Warranty claims and lawsuits based on breach of contract, which had always been available, significantly increased.

In the mid-1980s, the cost of insurance skyrocketed and the number of lawsuits soared.  Since the mid-1990s, the number of lawsuits has not increased as fast and may even have reached a plateau.  The reasons for this are unknown but are probably attributable to safer products, the high cost of prosecuting a products liability case combined with the high success rate of defendants at trial, and more conservative courts and juries. 

Despite this development, products liability is as dangerous as ever.  The threat of punitive damages is still real and when a jury awards damages in a serious injury case, they can be significant.  The threat of losing compensatory and punitive damages plus the high cost of defending cases results in more than 95% of all cases being settled or otherwise resolved prior to trial.

In addition, there are new threats.  Plaintiffs are now banding together to file class action lawsuits where there has been some injury, a possible injury, and even in no-injury situations.  This has become very popular with medical devices and pharmaceuticals.  Additionally, the geographical breadth of products liability law has expanded, and almost every industrialized country in the world, plus some developing countries, has adopted some sort of products liability law.  Most of these laws use some concept of strict liability.  While not as “strict” as the law in the U.S., the threat of foreign lawsuits still exists and can cause big problems in U.S.-based litigation. 

This litigation explosion, which started in the early 1970s, was accompanied by the establishment of government regulatory agencies whose charter included product safety and monitoring the safety of products in the field.  In 1976, the Food and Drug Administration was given more power in safety and imposed a responsibility on medical device manufacturers to report safety problems and possibly recall their products.

Also, most industrialized countries have laws similar to those in the U.S. concerning device approvals prior to sale and include some responsibility to report product safety problems to foreign governments and possibly withdraw products from the market.

Products liability focuses on defects in products that exist at the time of sale.  Over the years, there have been three clearly defined kinds of defects. 

A manufacturing defect exists if the product “departs from its intended design even though all possible care was exercised in the preparation and marketing of the product.”  In other words, even if the manufacturer’s quality control was the best in the world, the fact that the product departed from its intended design meant that it had a manufacturing defect.  Moreover, the plaintiff need not prove that the manufacturer was negligent, just that the product was defective.  The focus is on the product, not on the conduct of the manufacturer.

Common examples of manufacturing defects are products that are physically flawed, damaged, incorrectly assembled, or do not comply with the manufacturer’s design specifications.  The product turned out differently from that intended by the manufacturer.  If that difference caused injury, the manufacturer will be liable.  There are very few defenses.

Design defects are very different.  With manufacturing flaws, usually there are only a handful of products that have the problem.  And it usually is proven that someone made a mistake, or was negligent. 

With design defects, it is different.  The manufacturer intended for the product to be designed and manufactured in a certain way.  And the product turned out the way it was designed.  The problem was that there was something deficient with the design. 

A product is deemed to be defective in design if a foreseeable risk of harm posed by the product “could have been reduced or avoided by the adoption of a reasonable alternative design” and the failure to use this alternative design makes the product not reasonably safe.  With this definition, the jury believes that the product could have been and should have been made safer.

An alternative definition used by some courts is that a product is defective in design if it is dangerous to an extent beyond that which would be contemplated by the ordinary consumer.

These tests are much more subjective than the test for manufacturing defects and this subjectivity is the cause of most of the problems in products liability today.  Manufacturers cannot easily determine how safe is safe enough, and cannot predict how a jury will judge their products based on these tests.  It is up to the jury to decide whether the manufacturer was reasonable or should have made a safer product.

The third main kind of defect involves inadequacies in warnings and instructions.  The definition is similar to that of design defect and says that there is a defect in warnings if foreseeable risks of harm posed by the product “could have been reduced or avoided by …reasonable instructions or warnings” and this omission makes the product not reasonably safe.

Again this is an extremely subjective test that uses negligence principles as a basis for the jury to decide.  As with design, it is difficult for a manufacturer to know how far to go to warn and instruct about safety hazards of the product.

One other theory of liability that is very important in a products liability case involve post-sale responsibilities.  A manufacturer or product seller may have a duty, after sale, to warn customers about hazards the manufacturer learns about after sale.  This duty can arise even if the product was not defective or hazardous when sold.  This duty is clearly based on negligence and involves any of the three kinds of defects described above.

The law of products liability applies to every entity in the chain of production and distribution.  This starts with the raw material and component-part suppliers and, in the case of many medical devices, ends with the healthcare professional or healthcare facility. 

While every entity that supplied raw materials and component parts to a final product may be liable in products liability, as a rule, such sellers are not liable when the component or raw material is not defective.  To impose liability there would put an undue burden on such suppliers to scrutinize another’s product that they had no part in designing or manufacturing.

In the normal situation, a final product manufacturer (“OEM”) buys raw materials and component parts from manufacturers and sellers without disclosing what they are to be used for.  The OEM may supply specifications to such sellers, but usually the seller does not know how their product will be used.  And they generally have no duty to ask.

However, there is an exception to this general rule of no liability when the supplier participates in the selection of and integration of the component or material into the design of the product, and this selection or integration causes the product to be defective and to cause harm.  Thus, the supplier really becomes part of the OEM’s design team and is rightfully subject to liability for giving bad advice that results in a defect and injury.

The other exception to the general rule of no liability is when the component is defective and that defect causes harm.  The defect can be any of the three main defects – manufacturing, design, or warnings and instructions.  These kinds of cases can get very complex since the OEM and part supplier will fight over who knew what and who was at fault.

Healthcare professionals can certainly be sued for injuries caused by medical devices.  The claim could be that the professional was negligent in prescribing or using the device on the patient.  The professional does have a defense where they relied on the device manufacturer’s information in prescribing and using the device.  However, it is a question of fact for the jury as to whether the professional followed this information or deviated from the instructions provided by the manufacturer.  Therefore, the professional, as well as the healthcare facility and their employees, may be parties to the lawsuit.

Defending medical-device cases can be very complex because there are usually many parties involved and each of them will most likely try to blame someone else in the chain to deflect their own liability.

Cases involving medical devices have increased significantly as more complex devices are being developed and as the use of devices have expanded to home health care situations.  This makes it even more important for device manufacturers to proactively evaluate their risk and implement preventative procedures to minimize the risk of products liability, regulatory liability, warranty liability and contractual liability.  These preventative procedures, which will be discussed in subsequent articles, may even exceed regulatory requirements.  Since compliance with FDA requirements is not usually a defense in a products liability action, the manufacturer must consider the common law and endeavor to meet or exceed those requirements. 

Do Your Products Only Expose Your Firm to Bodily Injury and Property Damage?

Medical technology and life sciences company executives dedicate significant time and corporate resources to managing risks associated with their products.  Typically, the first line of defense is the purchase of products and completed operations liability which provide coverage for damages that result from "bodily injury" and "property damage" included within a "products-completed operations hazard."  While these policies are important purchases for protecting your firm's balance sheet, do they sufficiently offer comprehensive protection from other liability exposures that your products and operations create?  There are several areas of risk of loss not covered by most products liability insurance forms which result from, or arise out of, an insured's product and thus could impact the financial health of a medical technology company.  Purchasing manufacturer's errors and omissions, product recall expense and product liability coverage is a comprehensive approach to management of risk arising from products.

Most products liability insurance coverage forms grant coverage for "bodily injury" or "property damage" within the "products-completed operations hazard"1 for injury or damage occurring away from premises owned or rented by the insured and arising out of the insured's "product" or "work."  "Product" is usually defined as the goods that are manufactured, sold, handled, and distributed by the insured, including the containers for the goods, as well as warranties on the product.  "Work" is typically defined as operations and materials performed by the insured.  These broad definitions of coverage are refined by the common exclusions contained in most products liability policies.  Included are key exclusions which can have significant implications for some medical technology and life sciences companies.  These are:

Property damage to personal property in the insured's care, custody, or control. This exclusion is significant if you repair or service others' property, as liability for damages to the property of others is not covered when that property is at the insured's location or under the insured's control and possession.Property damage to the insured's product or work. This exclusion removes coverage for any damage to your product or work itself, generally meaning that the value of the product or work is not covered when settling damage or injury claims.Property damage to "impaired property" or property not physically injured. In this exclusion, impaired property is tangible property which cannot be used or is less useful because your property or work, incorporated in the impaired property, is defective, deficient, or dangerous or impaired due to your delay or failure to perform according to contract terms. Recall of products or work. The form excludes damages or expenses you incur due to withdrawal or recall of your products or work.

Acme Precision Manufacturing makes component electronic connectors for Quality Health's medical diagnostic and monitoring machines.  Quality Health's products must be manufactured to precise specifications and tolerances so that the diagnostic device can maintain its sensitivity and accuracy.

Due to a change in processes at Acme's plant, the tolerances of the connectors were slightly off specifications, and they were shipped and incorporated into Quality Health's product.  After Quality Health had released the product into the marketplace, the company received reports of erratic performance and discovered the malfunction was attributed to components provided by Acme Precision.

Quality Health sued Acme claiming property damages and recall expense.  In turn, Acme submitted the claim to the insurance company providing products liability coverage to Acme.  The insurance company stated the damages claimed by Quality Health were not covered by the products liability policy Acme purchased and cited the policy exclusions for property damage to impaired property and recall of products.

Goodwork Medical Technologies sells, repairs, and installs therapeutic medical equipment.  The company takes equipment into its laboratory for calibration, testing, repair, or other service.

Goodwork Medical has a servicing contract with Bon Vivant, a large healthcare provider, for ongoing maintenance on some medical electronics equipment.  After installing a new component part on a large piece of equipment, the machinery malfunctioned while in Goodwork's laboratory, damaging both the new component and the existing apparatus.

Bon Vivant presented a claim for damages to Goodwork and the company submitted the claim to its products liability insurer.  The insurer denied coverage because the product liability policy Goodwork had purchased contained exclusions for property damage to personal property and to the insured's product or work. 

If Acme Precision and Goodwork Medical had purchased manufacturer's error and omissions protection each company would have had coverage for the property damages claims made against them.  

Further, if Acme Precision had purchased products recall expense coverage the expenses associated with Quality Health's product recall claim would have typically been covered.

Manufacturer's errors and omissions (E & O) is a unique product designed to offer coverages that the typical products liability coverage form excludes; specifically, coverages for "physical injury" to products or work and "business injury" which is the customer's loss of use of property not physically injured.  In fact, some carriers refer to this coverage form as a "commercial general and products liability gap" coverage because the policy is intended to fill in gaps in the Commercial General and Products Liability offering.

Typically, manufacturer's errors and omissions liability coverage offers defense and economic loss that the insured would be obligated to pay as a result of covered "wrongful act"-that is, the insured's negligent act in the design, manufacture, and installation of the insured's product or a performance failure of the insured work or product that results in a defect or deficiency.

In addition to the business injury coverage grant, manufacturers' errors and omissions typically also covers liability for "product physical injury" which is defined as sudden or accidental physical injury to the insured's product after it has been put to its intended use, or damage to the personal property of others in the insured's custody or on the insured's premises for the purpose of performing work.

In the above case studies the loss of use and the loss of economic value due (Acme) and damages to personal property (Goodwork Technologies) claims would typically be covered by a manufacturer's E & O policy.

This coverage is most often available as "claims made," meaning the claim must be made during the policy period, with defense costs and indemnity within the limits of insurance and policy limits range from $1 million to $10 million.  The pricing of this coverage is often based upon annual gross sales.

Product recalls of healthcare technology products take place on an almost daily basis.  The Food and Drug Administration (FDA) monitors and regulates medical device recall events, listing open recalls on their website2, with the most serious recalls, Class I, receiving oversight and attention.  There are also many voluntary recall products which may be defective, or may need to be checked, adjusted, or withdrawn because of risk to the health of the users.  The economic cost of conducting such voluntary or regulatory recalls is huge, with price tags between thousands of dollars per unit up to millions of dollars in cost per event.  These estimates do include liability costs associated with injury or negligence.  Many medical device companies purchase product recall expense insurance as a way of managing the risk associated with product recalls.

Product recall expense insurance is generally reimbursement coverage for costs that an insured incurs during a recall event.  Coverage for costs can include physical removal of products from the marketplace, communications in print or other media notifying the public about the recall, third party expenses such as those of a distributor on behalf of the insured, and additional costs for advertising to regain customer loyalty after a damaging recall event.

In the Acme case study the product, incorporated in Quality Health's equipment, had to be withdrawn from the marketplace due to a defective component provided by Acme.  The company's liability for the costs of the recall would typically be reimbursable if either or both companies had this insurance as part of the risk management approach.

This coverage exists in a variety of forms and grants; some are independent policies, while others are endorsements to existing coverages.  Generally, this insurance solution provides coverage based on a per event limit, subject to a deductible and often a participation percentage, in which the insured shares in some of the specific costs of the recall event.  The policy may also have an annual aggregate and offer extension such as reimbursement of costs to replace product in the marketplace.

Insuring agreements may have unique terms and conditions.  Some coverage forms apply only to government or regulatory mandated recalls; other options may include voluntary withdraw based on the insured's reasonable and good faith determination to withdraw the product.  In addition, many product recall expense forms also reimburse costs of product withdrawal due to actual, alleged, or threat of product tampering.  

The cost of this coverage is also determined by a rate applied to gross sales; rates are usually determined by the complexity of the product, the history of recall, and limits of insurance, deductible, or participation.  Most coverage offerings begin with a $50,000 limit which can be increased accordingly.

Medical technology and life science company executives invest a substantial amount of time and money managing risk that is associated with the products of their companies.  While most buy products liability coverage, they may also find that these products liability policies have gaps in coverage that expose their companies to financial loss from their products and services.  A more comprehensive approach to products risk management can include purchase of manufacturer's errors and omission and products recall expense coverage or a constellation approach to risk management in which all insurance solutions work together to protect the insured and provide value for their premium dollars.

For more information on this topic, please contact The Hartford at medtechlifesci@thehartford.com.

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Financial Conduct Authority may ban harmful products

Martin Wheatley, designado Director Ejecutivo de la autoridad financiera de conducta. Fotografía: Carl corte/AFP/Getty Images

Nueva vigilancia financiera de Gran Bretaña se ha comprometido a limpiar el sector de servicios financieros mediante el uso de nuevos poderes para suspender o prohibir productos si aparecen perjudiciales para los consumidores.

La financiera realizar autoridad (FCA), que asume el control de la autoridad de servicios financieros la semana que viene, trazado planes para proteger a los consumidores y mantener el mercado "limpieza" donde los productos financieros son "inherentemente defectuosas" o "en grave peligro de ser vendido a los clientes mal". Hasta ahora, el regulador ha examinado la venta y comercialización de productos, pero no su diseño.

Diez años después de que el regulador primero fue advertido acerca de los problemas con protección de pagos seguro, grupos de consumidores dicen que una ofensiva contra la venta de productos financieros dudosos es desde hace mucho tiempo.

Ventas de las políticas PPI podían continuar desactivada durante años mientras que el regulador realizó un examen a fondo. Miles de políticas fueron vendidos a pesar de una ola de quejas de los clientes que fueron cargados las altísimas tasas y luego dijo que eran incapaces de hacer una reclamación.

Finalmente el regulador resolvió que incumplen las normas de la ciudad. PPI ya ha costado a los bancos más de £12bn en concepto de indemnización.

Sin embargo, la jugada polémica por el nuevo vigilante espera despertar oposición por parte de los bancos y las aseguradoras, que temen que los grupos de consumidores ejercerán presión sobre el dispositivo de vigilancia para bloquear la venta de productos altamente rentables.

Martin Wheatley, Director General designado de la FCA, dijo: "la creación de la FCA es nuestra oportunidad para restablecer las normas de conducta. Este poder, junto con nuestros nuevos poderes, ayuda a definir cómo regulamos.

"Sabemos que algunos en la industria están preocupados por nosotros mediante este poder precipitadamente; Quiero ser claro que sabemos juicio proporcional es necesario, y eso es lo que ejercemos. No hay que esperar que utilicemos este poder con frecuencia, pero industria y los consumidores deben tener claro que no dudaremos a utilizar estos poderes donde tenemos serias preocupaciones".

Algunos de los casos en que la ley podría considerar suspender la venta de un producto son:

• Dónde un producto está en grave peligro de ser vendido a los clientes mal, por ejemplo donde complejo o se venden productos de nicho para el mercado masivo;

• donde una función no esenciales de un producto parece estar causando graves problemas para los consumidores; y

• donde un producto es inherentemente defectuoso.

La FCA asumirá responsabilidad por cubierta 26.000 empresas de servicios financieros, mientras que la autoridad reguladora prudencial, que formará parte del Banco de Inglaterra, asume el papel de la FSA, monitoreo de los riesgos sistémicos planteados por las aseguradoras y bancos más importantes de la protección del consumidor.

Los recursos necesarios para apoyar el papel ampliado de FCA será una carga más grande de la industria, según el presupuesto de la organización.

Contará con un presupuesto de 432 millones de libras esterlinas y 2.800 empleados, en comparación con el presupuesto de 2012-13 de 578 millones de libras esterlinas y aproximadamente 4.000 personas de la FSA.

PRA, el regulador se centró en la estabilidad financiera, tendrá 1.300 personal supervisar 1.400 bancos y compañías de seguros, pero aún no ha anunciado su presupuesto.

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Banks and insurers urged to create 'simple' products

The government has asked finance companies to develop less complicated products to encourage savers. Photograph: Philip Brittan/Alamy

The government is urging financial services companies to offer a set of simple financial products to customers to encourage more people to save.

A report commissioned by the Treasury has outlined four accounts and policies that should be offered and standards they should meet before being put on the market. The products will be reviewed by the British Standards Institution and those that qualify will be given a kitemark showing they meet the standards on simplicity.

A steering committee led by Carol Sergeant, a former chief risk officer at Lloyds Banking Group, was asked to look at the implementation of simple products after concerns consumers were being deterred from saving by the complexity of products on offer.

It spoke to groups representing banks, building societies and insurers, and has outlined products which the industry has indicated it will be willing to offer. The Treasury will review the marketplace in 12 months to see whether providers are making the accounts available.

The first set of simple financial products will be an easy access savings account, a 30-day notice savings account, a regular savings account, and a fixed-term life insurance product, typically the type taken out with a mortgage.

Under the proposals, the savings would have low minimum investment levels – just £1 for the instant access and notice accounts – and there would be limited restrictions on withdrawals and access.

Information on the products will be "straightforward and consistent" and the key terms and conditions will be the same for each product, making them easy to understand and compare.

The next product available should be a whole-of-life insurance policy, and the Association of British Insurers has been asked to look at how an income replacement policy could be added to the list.

Sergeant said: "We have known for a long time that being able to manage your finances effectively leads to increased well-being and a better quality of life, at every given level of income.

"I hope the simple financial products initiative will make it easier for people to understand and compare the key financial products they need and make good choices with confidence."

The economic secretary to the Treasury, Sajid Javid, said: "The challenge now is to ensure that the work that has gone into the Sergeant review is transformed into tangible changes for consumers, and I look forward to discussing progress made with the industry and consumer groups next year."

Richard Lloyd, executive director of consumer group Which?, welcomed the proposals. "Consumers should not have to tackle pages of terms and conditions and they should be told clearly what rates and charges apply, so they can shop around more easily and get a fair deal," he said. "We now look to the financial services industry to deliver on these proposals."

The head of the Building Societies Association, Adrian Coles, said his members had been pleased to take part in the review of the market but pointed out that there are other deterrents to saving.

"We understand that the current economic climate is challenging for savers and that squeezed household budgets coupled with lower interest rates are currently a disincentive to saving," he said. "Nevertheless, the report makes some helpful proposals."

Previous initiatives to simply financial products have fallen by the wayside. Sergeant said the lessons learned from past attempts had informed the report.

"It is clear that successful products need to be affordable for consumers as well as commercially viable; meet real consumer needs; be straightforward to understand, compare and manage ; and be supported by a wide group of key stakeholders," she said. "Over 50 organisations have been involved in putting today's recommendations forward, and we have the full support of consumer bodies for these products and the commitment of the banks and insurance companies to deliver them."

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Samsung Ends Bid for European Sales Ban on Apple Products

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Samsung, the South Korean electronics giant, had been seeking injunctions in several countries, including Britain, France, Germany, Italy and the Netherlands, contending that Apple, Samsung’s biggest rival in the smartphone market, had infringed Samsung patents.

The move came only a day after a ruling in a related case in San Francisco, where a Federal District Court judge rejected a request by Apple, which is based in California, for an injunction to block sales of certain Samsung devices. The decision followed a previous jury ruling that Samsung had violated Apple patents.

After the latest twist in the European case, Samsung said it had acted “in the interest of protecting consumer choice.” Analysts said other factors might have been in play, including a possible nudge from the European Commission.

In January, the commission opened a formal antitrust investigation into Samsung’s licensing terms for patents covering wireless technologies. Under a previous agreement, Samsung had pledged to make the patents available to competitors on “fair, reasonable and nondiscriminatory” terms.

“The scope of what was withdrawn precisely matches the area in which the European Commission has been investigating,” said Florian Müller, a patent consultant in Germering, Germany. “It’s not just that the plot is thickening; in my view, there can be no other plausible view than that there is pressure from Brussels.”

The commission previously said that it was concerned about possible abuse of patents like the ones at issue in the Apple-Samsung injunction request, which cover technologies needed for a device to function. Without some of these “standard essential patents” from Samsung, for example, phones cannot connect to high-speed wireless networks.

“Regulators have been saying, if the patent holders try to abuse these patents, then they are going to get in trouble,” Mr. Müller said.

The commission declined to comment directly on whether there might be a link between Samsung’s announcement on Tuesday and the antitrust case in Brussels. “We take note of this development,” said Antoine Colombani, the spokesman for the European competition commissioner, Joaqu?n Almunia. “Our investigation is ongoing.”

Samsung said that it could not comment on the proceedings but that it was “fully cooperating with the European Commission.”

“Samsung remains committed to licensing our technologies on fair, reasonable and nondiscriminatory terms, and we strongly believe it is better when companies compete fairly in the marketplace, rather than in court,” it said in a statement.

There has been speculation that Samsung and Apple have been in talks to reach a settlement, though the broad scale of the litigation between the two companies, with lawsuits seeking sales bans or damages continuing on several continents, could make that challenging.

“We cannot comment on details of ongoing legal proceedings, but we believe a commercial resolution is achievable,” Samsung said in a statement.

Alan Hely, a spokesman for Apple, declined to comment.

The announcement by Samsung did not end litigation between the two companies in Europe. Samsung said it planned to pursue lawsuits seeking damages from Apple for what it contends is patent infringement.

Apple and Samsung have also been battling over other patents, covering nonessential features of their devices, like design.

Apple, too, has previously secured bans on the sale of certain Samsung products. Last year, for example, a court in Düsseldorf ruled that Samsung could not sell one of its Galaxy tablet devices in Germany because it bore too close a resemblance to the iPad 2 from Apple.

While some analysts cited regulatory pressure as a possible reason for Samsung’s decision on Tuesday, others said the company might have decided that the lawsuits were simply a distraction. Samsung’s phones, especially its Galaxy S3, have been selling well.

In the third quarter, the S3 surpassed the iPhone 4S to become the world’s best-selling smartphone, according to Strategy Analytics, a research firm.

“Maybe the market was telling them that they were succeeding and their time was better spent promoting sales of their product,” said Charles Golvin, an analyst at Forrester Research.

James Kanter contributed reporting.

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