Posts Tagged ‘fen-phen’

January 7: Vioxx Settlement panel at AEI

Please register for this event online at http://www.aei.org/event1626.

The AEI Legal Center for the Public Interest and the Federalist Society present:

The Vioxx Settlement

Monday, January 7, 2008, 12:00 p.m.–2:00 p.m.
Wohlstetter Conference Center, Twelfth Floor, AEI
1150 Seventeenth Street, N.W., Washington, D.C. 20036

In 2004, Merck withdrew its pain reliever Vioxx from the market because of new studies showing increased cardiovascular risk. Merck announced that it would not settle any of the tens of thousands of Vioxx lawsuits filed, and set aside over a billion dollars to litigate cases without reserving a penny for damages. After a $254 million verdict in the first Vioxx trial in 2005, some observers predicted over $25 billion in liability for the company. Fifteen trials later, Merck and the plaintiffs’ attorneys announced a settlement of the outstanding personal injury litigation—for under $5 billion. Merck stock rose after the announcement, and is now higher than before it withdrew Vioxx from the market. But some law professors are arguing that a new and unusual provision in the settlement raises ethical concerns.

Why did Merck settle? And why was the settlement for so much less than originally anticipated? Is the Merck settlement different from the Wyeth fen-phen settlement, which was originally announced as a $3.75 billion settlement, but has so far cost more than $20 billion? Will the settlement stand up under legal challenge, and what will remain of the Vioxx litigation if it does?

At this event cosponsored by AEI and the Federalist Society, a panel of experts will explore these and other questions. Speakers include Vanderbilt law professor Richard Nagareda, author of Mass Torts in a World of Settlement; Virginia legal ethics professor George Cohen; author and leading pharmaceutical mass torts defense attorney Mark Herrmann; Andy Birchfield, a member of the Vioxx Plaintiffs’ Steering Committee; and Ted Frank, director of the AEI Legal Center for the Public Interest. AEI resident scholar John E. Calfee will moderate.

11:45 a.m.
Registration and Lunch

12:00 p.m.
Panelists:
Andy Birchfield, Beasley Allen
George Cohen, University of Virginia School of Law
Ted Frank, AEI
Mark Herrmann, Jones Day
Richard Nagareda, Vanderbilt University Law School

Moderator:
John E. Calfee, AEI

2:00 p.m.
Adjournment

Scruggs indictment IX

Yes, it seems there were wiretaps. Defendants will be seeing evidence from the prosecution momentarily which might (or might not) be the trigger for further flipping and early plea deals, if such there will be.

There is enormous curiosity (e.g.) about P.L. Blake, to whom Scruggs says he paid $10 million (and tens of millions more in future payments) for vaguely described intelligence services aimed at swaying political influentials during the tobacco caper. Per a 1997 account posted at Y’All Politics, “Blake pleaded ‘no contest’ in 1988 to a federal charge that he conspired to bribe officials of the now-defunct Mississippi Bank to secure favorable loan terms.” The same article, citing reporting in the Jackson Clarion-Ledger, reports that Blake was in close phone contact between 1994 and 1996 with eventually-disgraced state Auditor Steve Patterson, who after leaving office went into partnership with Timothy Balducci and is one of the five indicted in the current Scruggs affair. Per AP, “Patterson was a banker at Mississippi Bank before his 1984-1987 tenure as head of the Mississippi Democratic Party.”

David Rossmiller, as so often, is out front with a report filling in background on two other controversies involving Blake. One arose from a venture into the grain storage business which landed him in a Texas dispute in which his attorney was none other than Fred Thompson, later a Tennessee senator and presidential candidate. The other arose from his cordial dealings with a former chief of staff to Sen. Trent Lott (R-Mississippi).

Harper’s blogger Scott Horton has now published his take, as is his wont heavily dependent on hush-hush (but no doubt wholly trustworthy) confidential sources who float all sorts of theories about scoundrelly doings by the highly placed. He winds up with a theory that would pull Sen. Lott into it (though with no allegation of criminality) by way of the Acker contempt matter, as distinct from either the Balducci/Lackey bribery attempt or, say, the Paul Minor affair. Of Horton’s many anonymously sourced speculations, the one that caught my eye was tucked into a footnote: “A law enforcement official I interviewed, who for professional reasons asked to remain anonymous, told me that Scruggs’s junior partner Sidney Backstrom might take the same road as Balducci.” Now that is news a rumor (more). (Update Tues. evening: Backstrom’s attorney Frank Trapp flatly denies that anything of the sort is in the works: Patsy R. Brumfield, “Backstrom firm on innocence, his attorney says”, Northeast Mississippi Daily Journal, Dec. 12.)

This is probably a good place to apprise readers who aren’t aware of it that 25-odd years ago, while first gaining a footing in the policy world, I worked briefly on Capitol Hill drafting research papers for a committee then headed by Mr. Lott. We only talked a couple of times, I had never set foot in the state of Mississippi at the time, and I’m pretty sure he wouldn’t recognize me on the street, but if you’re a conspiracy theorist about such matters, there you have it.

At Y’All Politics, commenter “lawdoctor1960” has some speculation as to why the remarkable deposition of Scruggs in the Luckey case didn’t get more media or political attention at the time.

Welcome Andrew Sullivan, David Rossmiller, Y’All Politics readers.

Attorney Tim Balducci’s role as deputized lawyer for the state of Mississippi in the MCI and Zyprexa cases is drawing public scrutiny, and may result in pressure for reform of AG outside contracting.

We’ve started a new “Scandals” category for readers who want quick access to coverage of the Mississippi mess, also stocked with some earlier links to coverage of such earlier blow-ups as Milberg Weiss/Lerach, Kentucky fen-phen, the Paul Minor affair, etc. For those who are following Scruggs posts in sequence, be aware that yesterday’s first and second posts fell outside the numbering scheme.

November 2 roundup

  • Curlin gets 400 new owners, as the Kentucky fen-phen plaintiffs ripped off by their attorneys get the right to seize Shirley Cunningham Jr. and William Gallion’s 20% share of the Preakness Stakes winner. [AP/NYT; earlier]
  • As Lerach pleads guilty, LA Times editorial defends class action abuses, incorrectly says that the PSLRA fixed everything and that Lerach didn’t act illegally after it was passed. [LA Times]
  • That $10.9 million verdict against the Westboro Baptist Church was “not about the money.” [Reuters] Really, now, this case imposing bankrupting damages for a protest on a public sidewalk is appalling. Granted: Phelps is bigoted scum, and rude bigoted scum at that. But Albert Snyder’s claimed physical injury is that the protest exacerbated his diabetes: what sort of junk science is that? NB that Snyder was not even aware of the protest at the funeral until he watched it on television. Why not liability for the news program? Even those happy to see the anti-gay bigotry of the WBC punished should take pause: Snyder testified at length that the protest upset him particularly because his son was not gay.
  • Overlawyered favorite Willie Gary (Apr. 29, Oct. 2004), on the hook for $28,000/month in child support for love child. [Atlanta Journal-Constitution]
  • Deep-pocket search in Great White fire case. [Childs]
  • Lawsuit over which school 9-year-old can play football for. [Tulsa World (via TMQ G. Easterbrook)] Worse, the judge rewarded the plaintiff by second-guessing the league decision. [Tulsa World]
  • It only takes ten months of legal proceedings for Cal-Berkeley to evict trespassers squatting on university property. [SF Gate]
  • Don’t hold your breath: who’s watching the trial lawyers? [Examiner]

October 10 roundup

  • She wore a wire: defense attorney says administrative assistant to one of the three lawyers in Kentucky fen-phen scandal worked as FBI mole, circumventing attorney-client privilege [AP, Courier-Journal, Lexington Herald-Leader, ABA Journal]
  • Suing a lawyer because his deposition questions inflicted emotional distress? No way we’re going to open those floodgates, says court [NJLJ]
  • Counsel Financial Services LLC, which stakes injury lawyers pending their paydays, says it’s “the largest provider of attorney loans in the United States and the only Law Firm Financing company endorsed by the AAJ (formerly ATLA)”; its friendly public face is a retired N.Y. judge while its founder is attorney Joseph DiNardo, suspended from practice in 2000 “after pleading guilty to filing a false federal tax return” and whose own lend-to-litigants operation, Plaintiff Support Services, shares an office suite with Counsel [Buffalo News] The firm’s current listing of executives includes no mention of DiNardo, though a Jul. 19 GoogleCached version has him listed as President;
  • Patent litigation over cardiac stents criticized as “a horrendous waste of money” [N.Y. Times]
  • More on the “pro bono road to riches”, this time from a California tenant case [Greg May, Cal Blog of Appeal]
  • Not a new problem, but still one worth worrying about: what lawyers can do with charitable trusts when no one’s looking over their shoulder [N.Y. Times via ABA Journal]
  • Has it suddenly turned legal to stage massive disruptions of rush-hour traffic, or are serial-lawbreaking cyclists “Critical Mass” just considered above the law? [Kersten @ Star-Tribune]
  • “Look whose head is on a plate now”: no tears shed for fallen Lerach by attorney who fought him in the celebrated Fischel case [ChicTrib, San Diego U-T]
  • “Jena Six” mythos obscures graver injustice to black defendants, namely criminal system’s imposition of long sentences for nonviolent offenses [Stuart Taylor, Jr. @ National Journal — will rotate off site]
  • Economist David Henderson on restaurant smoking bans [Econ Journal Watch, PDF, via Sullum, Reason “Hit and Run”]
  • Technical note: we learned from reader Christian Southwick that our roundups were displaying poorly on Internet Explorer (Ted and I use other browsers) and we found a way to fix. So, IE users, please drop us a line when you encounter problems — we may not hear about them otherwise.

Kentucky Fen-Phen update: judgment entered

We’ve provided extensive coverage of the Kentucky fen-phen scandal, in which the lawyers who represented fen-phen plaintiffs were found in a civil suit to have misappropriated more than $64 million of their clients’ money. The judge who heard the suit has now entered final judgment against the lawyers, which will allow the plaintiffs to start collection proceedings in 30 days, barring appeal by the lawyers. (The good news: to appeal, they would need to put up an appeals bond, which would make it easier for the plaintiffs to collect. It’s not clear whether they’re going to appeal; they may be too busy defending themselves against the criminal charges which have been filed against them.)

The lawyers’ lawyer calls it a “travesty of justice,” and offers an unusual defense to charges of defrauding clients:

“No one, including the judge, has acknowledged that the attorneys’ fees were ordered by a judge or the fact that each and every client in the case received multiples, and I repeat multiples, of any amount that they would have received if they had not been represented by my clients — Bill and Shirley.”

Since the lawyers did a good job in achieving the initial settlement, it’s okay for them to defraud their clients of some of the money? Pretty sure it doesn’t work that way. (And of course, in claiming that the fees were “ordered by a judge,” she somehow neglects to mention the fact that the judge was paid off by the lawyers, and that as a result he quit just before he was going to be kicked off the bench.)

Kentucky fen-phen lawyers are jailed

“The court finds that there is a serious risk that the funds will be moved offshore and that with these funds at their disposal, the defendants will flee to a country with which the United States has no extradition treaty or otherwise disappear,” U.S. District Judge William Bertelsman wrote in the Friday order sending Shirley Cunningham Jr., William Gallion, and Melbourne Mills Jr. to jail without bond until the January 7 trial date. (Jim Hannah, “Fen-phen lawyers are jailed”, Cincinnati Enquirer, Aug. 11). We have lots of coverage of the Kentucky fen-phen lawyers, who have been found in a civil case, to have misappropriated $62 million of settlement funds by overcharging on attorneys’ fees and other diversions. Cincinnati attorney Stan Chesley, who has not been criminally indicted, is also civilly liable on part of his $20 million fee for helping to negotiate the settlement, with the scope of liability yet to be determined; trial has been delayed while the criminal trial is pending.

Putnam County Hospital update

We earlier discussed the case of osteopath John King (who now calls himself Christopher Wallace Martin after surrendering his medical license in two states). We’ll state up front: King was apparently deservedly fired for incompetence, and that undoubtedly includes some legitimate cases of malpractice. (Indeed, our original note was how West Virginia’s Putnam County Hospital could have perhaps avoided hiring King had not liability concerns prevented his previous employers from communicating problems to the hospital.) Whether it’s asbestos, fen-phen, or an incompetent osteopath, however, the legal system creates incentives for attorneys and plaintiffs to fake cases and free-ride off of the legitimately injured. A YouTube video documents some curious inconsistencies (which, to be frank, are not entirely persuasive to me for all six plaintiffs in the video). The judge has responded to the video by barring both sides from further communications with the media. (Lawrence Messina, AP/Lexington Herald Leader, Aug. 1; Chris Dickerson, West Virginia Record, Aug. 1; Turkewitz blog). The West Virginia Record calls for a prosecutorial investigation.

New at Point of Law

If you’re not reading our sister site, you’re missing posts about federal indictments in the Ky. fen-phen scandal; great moments in labor arbitration; a big embarrassment (and maybe even liability?) for Yale Law School; more cosmetics from John Edwards on med-mal; New Jersey and Missouri high courts rule against lead-paint nuisance suits; federal judge refers for possible prosecution criminal contempt charges against Pascagoula potentate Dickie Scruggs; lots of Stoneridge coverage; and much more.

Kentucky fen-phen follies: May 20

Most recently: May 15; at American.com.

  • Curlin, the horse owned by fen-phen fraudsters Gallion and Cunningham, won the Preakness by a head. Curlin’s trainer is apparently ensconced in his own scandal, having served a six-month suspension for illegally drugging horses. (Andrew Beyer, “Making a Run for It”, Washington Post, May 20; Jennie Rees, “Curlin camp a crowded place”, Louisville Courier-Journal, May 20).
  • Stan Chesley did not even show up to the court-ordered May 16 mediation session, allegedly forcing a rescheduling until May 23. (Chesley’s attorney says he was in contact with his client at the hearing.) Plaintiffs have asked for sanctions. (Paul Long, “Mediation over lawyer fees fails”, Cincinnati Post, May 18).

Kentucky fen-phen follies: Abbott v Chesley and Bonar v Chesley updates

Earlier: May 11, May 8, Apr. 5, Apr. 4, etc.

  • Barbara Bonar gets supporting testimony in her claims against Stan Chesley, but loses bench trial in case she brought over questionable settlement over Catholic church sex abuse. Bonar, the next president of the Kentucky Bar, will appeal. In the meantime, she faces trumped up ethics charges for representing class member opt-out settlements. (Andrew Wolfson, “Covington lawyer loses fee dispute case”, Louisville Courier-Journal, May 12).
  • Angela Ford, who is bringing the lawsuit on behalf of Kentucky fen-phen victims ripped off by their attorneys against their co-counsel, Stan Chesley, is now also facing what seems to me retaliatory political pressure; a Hamilton County, Ohio, judge, apparently unaware of deposition commissions, is complaining that she subpoenaed an Ohio witness without being licensed to practice law in that state. For some reason, a Kentucky judge, Stanley Billingsley, is testifying on behalf of Chesley. An American Home Products witness contradicted defendants’ claims that they “set aside” some settlement money for future Kentucky claimants (who, under the U.S. Supreme Court Amchem precedent, could not be bound by the settlement). And the parties are in mediation tomorrow and Thursday, which, judging by Chesley’s attorney’s complaints about press coverage, implies a confidential settlement is near. Next court hearing is May 31. (Shelly Whitehead, “Fen-phen suit heads to mediation”, Cincinnati Post, Apr. 24; Beth Musgrave and Jim Warren, “Lawyers meet Wednesday to try to reach deal on fen-phen millions”, Lexington Herald-Leader, May 14).
  • Angela Ford herself has a website, which is not surprising, but it does include a remarkable resource of publicly-available court documents related to the Abbott v. Chesley case.