Thursday, August 23, 2007

Concurrent Vioxx trials and the Merck litigation strategy

According to an article in today's Star-Ledger, New Jersey Judge Carol Higbee has met with lawyers to propose a plan to move Vioxx trials more quickly.  Under her plan, four judges would preside over simultaneous trials, each involving multiple plaintiffs.  Here's an excerpt:

In an effort to move the sheer volume of lawsuits, Judge Carol Higbee is proposing four simultaneous trials at the courthouse. Each trial would involve multiple plaintiffs from New Jersey, New York and Pennsylvania.  Under the plan, which has been discussed in conference meetings between Higbee and lawyers involved in the cases, three other judges would be assigned to preside over the additional trials. All four trials are scheduled to begin Jan. 22 at the Atlantic City courthouse.

Merck has consistently opposed joint trials in the Vioxx litigation, insisting that the issues are too individualized to permit a fair trial with multiple plaintiffs.  Merck's defense attorney Theodore Mayer of Hughes Hubbard & Reed was quoted in the article as saying, "We feel very strongly that justice in each case should not be affected by the large number of cases."  Simultaneous separate trials presumably would not present the same problem, but the inclusion of multiple plaintiffs in each trial would.

This news comes on the heels of an article in the New York Times two days ago (see Byron Stier's prior post) pointing out that despite a number of plaintiff verdicts, no Vioxx plaintiff has yet been paid by Merck.  With tens of thousands of Vioxx suits in the pipeline and with lengthy appeals from every judgment, plaintiffs could wait years for trial and, if successful, much longer for payment.

In this light, it's interesting to think about Merck's strategy.  Merck steadfastly refuses to settle Vioxx cases, preferring to pay massive legal fees to litigate each case individually.  It is reminiscent of the litigation strategy of the tobacco industry from 1954 to 1994.  The tobacco defendants, however, knew that they could win virtually every case, in part by vastly outspending and outlawyering the opposition.  That's not the case with Vioxx.  Merck faces capable opposition with substantial resources to invest in the litigation.  Trial outcomes have gone both ways.  But that does not mean that Merck's strategy is wrong.  To the contrary, it appears to have been a highly successful strategy of lowering settlement values.

It still seems likely, despite Merck's avowed disinterest, that the endgame will be some form of collective settlement.  By avoiding class actions or joint trials, by declining to settle early, and by litigating each individual case to the hilt, Merck has improved its bargaining position.  Its strategy forces plaintiffs' lawyers to think hard about which prospective clients' cases are worth pursuing, and undoubtedly has discouraged some lawyers from investing their time and resources in the litigation.  When the hardball strategy reaches a point of diminishing returns, and as litigation costs continue to mount, it may make sense for Merck to seek a settlement or series of settlements.  When the cost of litigating exceeds the cost of settling, a defendant can justify the expense only as long as it reaps a substantial strategic benefit, such as discouraging plaintiffs from piling on early in the litigation.

In the meantime, the judicial system cannot work on the assumption that an aggregate settlement is in the offing.  The judges have to move forward with trying these cases, while respecting the individual issues.  Judge Higbee's reported plan of simultaneous trials seems to be a reasonable step in that direction.

HME

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Comments

I would agree that Judge Higbee's plan may be reasonable, so long as the multiple-plaintiff trials do not create confusion for the jury. That question turns not merely on the number of plaintiffs, but also on the extent to which evidence overlaps among plaintiffs. Different factual stories about taking Vioxx and different medical conditions and risk factors can quickly complicate the jury's task in keeping things straight. Including more than, at most, a handful of plaintiffs in a single trial would likely impermissibly sacrifice individual justice to gain procedural efficiency.

BGS

Posted by: Byron Stier | Aug 29, 2007 9:41:01 AM

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