John O’Quinn update

by Ted Frank on April 15, 2007

Judge Denise Page Hood has issued an order to show cause why the O’Quinn law firm (many entries; also POL Jul. 15, 2005, POL Jul. 10, and POL Aug. 3) should not be held in contempt for improperly withholding breast implant settlement money from their clients. There is no press coverage of this brewing scandal.

There has, however, been plenty of press coverage of one of O’Quinn’s other clients, Anna Nicole Smith’s mother. In that circus, O’Quinn finds himself a defendant in a civil defamation suit brought by Smith’s, er, widower, attorney Howard K. Stern, for going on national television and accusing Stern of murdering Smith. [AP/ABC News] The fact of having this client gave cause TMZ.com to dig up some of the more obvious scandals in O’Quinn’s past, though they still missed the more recent ones covered by Point of Law.

Elsewhere in O’Quinn news: the firm settled its $1 billion fen-phen verdict (Apr. 28, 2004) for an unknown amount on the eve of appeal as part of a global settlement of O’Quinn’s caseload of fen-phen cases. (Brenda Sapino Jeffreys, “$1 Billion Fen-Phen Case Settles Before Appellate Oral Arguments”, Texas Lawyer, Apr. 16). The verdict was tainted because the plaintiffs blamed fen-phen for Cynthia Cappel-Coffey’s PPH, but Ms. Cappel-Coffey had been taking four other diet drugs since fen-phen had been pulled from the market that had the known risk of causing PPH. Yet that evidence was excluded from the jury, though the Texas Lawyer coverage barely touches upon this outrage. The state court in judicial hellhole Beaumont also improperly applied Texas caps on punitive damages.

Complete text of the breast implant order after the jump, if you don’t want to read the order in PDF format.

This matter came before the Court on a report from the Claims Administrator,
Settlement Facility –Dow Corning Trust (the “SF-DCT”) that The O’Quinn Law Firm and a
predecessor firm, O’Quinn & Laminack (the “law firms”) are and have been charging interest
to the law firms’ clients as part of funds disbursed by the law firms as the result of settlements
with the SF-DCT.

On October 6, 2005, this Court entered an Agreed Order Adopting Additional Q&A
Pursuant To Article IX of Annex A, The Claims Resolution Procedures (the “Order”) (Docket
No. 231). The Order clarified the extent to which allowable attorney’s fees and expenses could
be charged by the law firms as part of SF-DCT settlements, and presented the clarification in
Exhibit 1 to the Order in a question-and-answer format, as follows:

Q12. Can a law firm charge interest on expenses the firm advanced or for a loan
the firm took out to handle a claimant’s case?

A8. [sic] No. Interest on either a loan or on expenses advanced are not chargeable to
the claimant.

Q13. Can a law firm charge each client it represents a percentage of expenses it
incurred on behalf of all clients?

A13. No. The allowable expenses must be related to the client’s individual case
as set forth in Q11-4 in the Claimant Information Guide.

Q14. Can a law firm charge the client for expenses incurred in attending
meetings or seminars on breast implant issues?

A14. No.

(October 6, 1005 Order, Docket No. 231)

The Claims Administrator of the SF-DCT has reported to this Court that clients of the
law firms have complained to the Claimants Assistance Program (“CAP”) at the SF-DCT that
the law firms are insisting that, as a condition precedent to payments to the clients, that such
clients agree to reimburse the law firms out of the proceeds of SF-DCT settlements for interest
charged on funds disbursed by the law firms on behalf of the clients.

Based on the foregoing, accordingly,

1. IT IS ORDERED that Counsel for the law firms noted above must Show Cause, in
writing, by April 20, 2007, why the law firms should not be held in contempt for violating the
terms of the Amended Joint Plan of Reorganization, as more specifically noted above. The
Claims Administrator of the SF-DCT shall have until May 4, 2007 to respond to any filings by
the law firms. If after review of the submissions it is determined a hearing is required, the
parties will be notified of the date, time and place of the hearing.

2. IT IS FURTHER ORDERED that the Claims Administrator shall serve a copy of
this Order to the law firms noted above, the clients of the law firms who are affected by this
matter, the Reorganized Debtor, the Claimants’ Advisory Committee, and the Finance
Committee.

/s/ Denise Page Hood

DENISE PAGE HOOD

United States District Judge

DATED: April 5, 2007