Mass Tort Litigation Blog

Brickman Comments on DOJ

Professor Lester Brickman (of Cardozo) commented recently in the Wall Street Journal that the Department of Justice has given doctors and lawyers a "free pass" "to commit massive tort fraud, exceeding $30 billion in the past 15 years."  Here's an excerpt:

But it now appears as if neither this U.S. Attorney's Office nor the parent Department of Justice is going to prosecute mass tort fraud. Six months ago there were signs that Justice was moving forward on some key cases involving one or more of the litigation doctors. Now, unfortunately, that activity appears to have all but ceased.

The dimensions of this fraud are stunning. An asbestos screening of 1,000 potential litigants generates about 500-600 diagnoses of asbestosis. If these same occupationally exposed workers were examined in clinical settings, approximately 30-50 would be diagnosed with asbestosis. The total take for "excess" asbestos diagnoses is more than $25 billion, of which $10 billion has gone to the lawyers. More billions for bogus claims in the diet drug (fen-phen) and silicone breast implant litigations can be added to this bill.

A comparative handful of doctors and technicians are responsible for the vast majority of bogus medical tests and diagnoses. To indict and prosecute those responsible would require testimony from other doctors that the mass-produced diagnoses cannot have been rendered in good faith.

To be sure, doctors can differ in reading X-rays or making a diagnosis. But when a doctor has been paid millions of dollars to produce 5,000 or even 50,000 diagnoses in the course of mass-tort screenings -- and when panels of experts have found the vast majority of these to be in error -- the most compelling conclusion is that the diagnoses were "manufactured for money."

Prosecutors on the federal and state level are nonetheless concerned that such a "battle of the experts" will raise reasonable doubt in the minds of juries, and so they decline to prosecute these doctors, let alone the lawyers who hired them. This decision, however, gives the doctors a special dispensation to commit fraud.

Peter Lattman responded on the Wall Street Journal's Law Blog.

ECB

Epidemiology and Causation

I wanted to alert our readers to a very interesting post on the Drug and Device Law blog on epidemiology, general causation and specific causation.   How to harness epidemiology to decide cases in mass torts is one of the most important questions in the field.

ADL

Preemption Decision in Minn Tobacco Litigation

The BNA Class Action Reporter reports that a Minnesota Court of Appeals ruled that "a federal cigarette labeling law does not preempt state-law claims that representations about "light" cigarettes were fraudulent."  See Dahl v. R.J. Reynolds Tobacco Co., Minn. Ct. App., No. A05-1539, 12/4/07.  The court followed the First Circuit which held in Good v. Altria Group, Inc., 501 F.3d 29 (1st Cir. 2007) that the Federal Cigarette Labeling and Advertising Act does not preempt state law claims.  It diverged from the Fifth Circuit, which held in Brown v. Brown & Williamson Tobacco Corp., 479 F.3d 383 (5th Cir. 2007) that such claims are preempted. 

ADL

What Happens to Class Actions Denied Certification?

In In re Bridgestone/Firestone Products Liability Litigation, 333 F.3d 763 (7th Cir. 2003) (Bridgestone/Firestone II), the 7th Circuit denied certification of a nationwide class action and held that this decision was binding -- that is, absent class members could not refile this national class action in another court to obtain certification.

What happened next?  You might predict nothing. But that is not the case.  Instead, the litigation was settled in state court in Beaumont Texas.  You can see a short description in this article that appeared in the Texas Lawyer, reprinted in Law.com.  The unpublished opinion approving the settlement can be found on Westlaw: Shields on behalf of herself and all others similarly situated v. Bridgestone/Firestone, 2004 WL 546883 (Dist. Ct. Tx. 2004).

There are a lot of ways to read this chain of events.  Consider the following. The Class Action Fairness Act (CAFA) (which was passed after the events described above) was supposed to be responsive to concerns about certain state courts granting certification of class actions with minimal oversight.  It purported to solve this problem by giving jurisdiction to the federal courts of class actions over a certain size.  But when plaintiffs and defendants are both seeking certification, jurisdictional solutions like CAFA are unavailing because nobody is going to remove the case to federal court.  So does Bridgestone/Firestone II have more bite after CAFA?      

Addendum:  Since Beaumont is sometimes referred to as a "judicial hellhole", this article by Adam Liptak of the NY Times might be of interest (h/t TortsProf Blog).  Liptak analyzes a new report by the American Tort Reform Association claiming to "rank" judicial hellholes, albeit not empirically. 

“We have never claimed to be an empirical study,” said Darren McKinney, a spokesman for the association. “It’s not a batting average or a slugging percentage. It’s no more or less subjective than what appears in The New York Times."

If they actually did an empirical study, that would be worth reading.  The use of anecdotes in policy analysis is extremely misleading.  Not necessarily more misleading than the abuse of statistics can be, but perhaps less amenable to reasoned counter-argument and, to the extent that is true, more pernicious as a basis for policy making.  My favorite example of the moment of this problem is jury verdicts, which are so often reported as extraordinarily and perhaps offensively large.  But in fact studies consistently show that civil juries and judges agree approximately 80% of the time.  When they disagree, they split more or less evenly in favor of defendants and plaintiffs.  For more on this see Neil Vidmar and Valerie P. Hans' new book American Juries: The Verdict, a follow up to their excellent Judging the Jury, which presented the data in a very balanced and thoughtful way.

ADL

Plaintiffs' Emergency Motion Regarding the Vioxx Settlement

As an interesting follow-up to Howie’s November 10th post on the Vioxx Settlement, on December 17, 2007, some plaintiff’s lawyers filed an emergency motion requesting freedom to keep some of their clients outside the settlement. The settlement currently requires plaintiffs’ attorneys to recommend the settlement to 100% of their eligible clients and for 85% of plaintiffs to accept the deal.

The New York Times reports:

In an emergency motion to Judge Eldon E. Fallon of Federal District Court in New Orleans, the plaintiffs’ lawyers said the provision would prevent them from offering the best independent judgment for each client. Agreeing to the provision might open them to future lawsuits from disgruntled clients, they said.

"The settlement agreement, which allows Merck to dictate the advice a lawyer will offer, is improper in all states," the lawyers wrote in the motion, which was filed Monday.

Grant Kaiser, a Houston lawyer who represents about 1,800 plaintiffs, filed the motion. It was signed by 11 other firms that collectively represent another 4,200 plaintiffs — about 10 percent of all the people who have sued Merck over Vioxx. Mr. Kaiser declined to comment on the motion.

Merck and several large plaintiffs’ law firms agreed to the settlement last month as a way to resolve more than 50,000 claims from people who assert that Vioxx, a painkiller withdrawn from the market in 2004, caused them to suffer heart attacks and strokes. Merck had won most of the 18 suits that reached juries in both state and federal court.

The requirement that lawyers agree to recommend the deal to all their clients — and withdraw from representing those who do not agree — is a crucial part of the agreement.

Plaintiffs’ attorneys contend in their motion that:

Section 1.2.8.1 of the Settlement Agreement sets out one of these responsibilities. It requires each Enrolling Counsel to advise 100% of the lawyer’s eligible clients to participate in the Program and to affirm that the lawyer has done so in the Enrollment Form. No states’ law allows a lawyer to make a contractual commitment like this. Rule 2.1 of the ABA Model Rules of Professional Responsibility, a version of which is in force in every jurisdiction, requires every lawyer to give every client the benefit of the lawyer’s independent professional judgment and to render candid advice. The Restatement (Third) of the Law Governing Lawyers also recognizes his duty. The essence of independent professional judgment is that each client must be counseled accordingly. As the ABA comment to Rule 2.1 puts it: "A client is entitled to straightforward advice expressing the lawyer’s honest assessment." ABA Annotated Model Rules of Professional Conduct, Rule 2.1, Comment [1] (Fifth Ed.).

Accordingly, the emergency motion requests the following relief:

1. A declaration that the Settlement Agreement empowers the Court to modify provisions that are prohibited or unenforceable because they conflict with state bar rules in Texas and other states.

2. A revision of PTO 31 excising the affirmation relating to settlement participation from the Registration Affidavit and agreement to all terms of the settlement; 

3. A declaration that § 1.2.8.1 is prohibited and unenforceable under the state bar rules of all states because it prevents lawyers from giving clients the benefit of their independent professional judgment and candid advice, as required by Rule 2.1 of the Model Rules of Professional Conduct.

4. A declaration that § 1.2.8.2 is prohibited and unenforceable under the state bar rules of all states because it impermissibly restricts the right to practice law, in violation of Rule 5.6 of the Model Rules of Professional Conduct.

5. To set a date certain by which final settlement payments shall be made and/or make other similar equitable provisions.

6. To declare that notwithstanding any provision of the Settlement Agreement purporting to require an assessment of "up to 8%," that as to counsel that entered contracts in compliance with PTO 19, those contracts shall be honored, binding, and controlling as to any assessment.

The docket number is 2:05-md-01657-EEF-DEK and the motion is document number 13105-2.

ECB

Merck Continues Plans with Experimental Drugs

After touting its $4.85 billion Vioxx settlement as "a good and responsible agreement," Merck plans to continue with experimental cholesterol and obesity drugs. Anacetrapib, a developing cholesterol drug, is similar to Pfizer’s drug, torcetrapib, which failed after a study demonstrated increased death risks. Merck plans to submit its obesity drug, taranbant, for FDA approval next year. A similar drug called rimonabant, produced by Sanofi-Aventis, was rejected by the FDA earlier this year for psychiatric side effects. Wall Street Journal has a report (subscription required). The Wall Street Journal also reports that the FDA rejected Merck’s recent bid to sell Mevacor, a cholesterol drug, over the counter. Here’s an excerpt:

A Food and Drug Administration advisory committee, for the third time, rejected Merck & Co.'s bid to sell the cholesterol drug Mevacor without a prescription, saying it wasn't clear that consumers would use the medication correctly.

The 10-2 vote leaves little hope Merck can win regulatory approval. It is also a setback for GlaxoSmithKline PLC, which has bought the U.S. over-the-counter marketing rights to the drug. The decision is the latest sign of the regulatory hurdles blocking such switches, at least when a medication treats a complicated condition without obvious symptoms. The FDA typically follows the advice of its expert panels.

ECB