Friday, June 20, 2008
A U.S. District Court in Boston and New York state court held joint hearings on whether lawsuits against Pfizer, Inc. based on Neurontin could continue. Plaintiffs allege that the drug lead to suicides. Here's an excerpt of Jeremy Singer-Vine's Wall Street Journal report:
A British neurologist who analyzed effects of the drug Neurontin told a court hearing Thursday that he advised its maker -- now a unit of Pfizer Inc. -- to include a warning on the drug's label for potential side effects of depression and aggression, but his advice wasn't followed.
The University of London neurologist, Michael R. Trimble, was testifying at a hearing to decide whether civil cases brought against Pfizer alleging suicides linked to Neurontin can proceed. . . .
Dr. Trimble described what he said was a "plausible biological pathway" that could lead from the compound gabapentin -- the chemical name for Neurontin -- to suicidal behavior, hostility, and aggression. Dr. Trimble said that in 1995 and 1996, he was hired to write two confidential reports for Parke-Davis -- now a unit of Pfizer -- because the company "was concerned about psychosis in relation to their drug." Dr. Trimble said he was unable to find a link to psychosis, but noted effects of depression and aggression.
Lawyers for Pfizer argued at the hearing that the evidence linking the drug to suicidal side effects wasn't scientifically sound. Under cross-examination, they challenged his description of a pathway as a patchwork of studies that didn't prove a biological connection. Neurontin and generic forms of gabapentin are approved for treating epileptic convulsions, but have also been prescribed widely "off label" for other conditions.
Sheila Scheuerman (Charleston) just posted an article entitled "Two World Collide: How the Supreme Court's Recent Punitive Damages Jurisprudence Affects Class Actions" on SSRN. Here is the abstract:
This article examines the intersection between two controversial areas of the law - punitive damages and class actions - and argues that the Supreme Court's recent jurisprudence clarifying the due process limits on punitive damages has broad implications on the procedural laws governing the types of cases that can properly be certified as a class action. Specifically, the article discusses the Supreme Court's evolving approach to punitive damages from one that considered the harm a defendant's conduct caused to society as a whole to one that now focuses almost exclusively on the harm to the specific individual bringing the lawsuit. This shift, which recently culminated in the Court's 2007 decision in Philip Morris USA v. Williams, constitutionally requires that the amount of a punitive damages award relate to the amount of harm suffered by the party bringing the suit. That requirement is at odds with class action practices that treat punitive damages as a common, class-wide issue and that have allowed juries to assess a punitive damages award before evaluating the harm to the individual class members. The article argues, therefore, that where injuries are not uniform among class members, punitive damages cannot be pursued as a class-wide remedy.
Wednesday, June 18, 2008
The Widener Law Journal has published its issues in connection with its February 2008 symposium, Crimtorts. Torts Prof Blog has links to all the articles, which include the following:
Christopher J. Robinette, Introduction
Kenneth W. Simons, The Crime/Tort Distinction: Legal Doctrine and Normative Perspectives
Michael L. Rustad, The Supreme Court and Me: Trapped in Time with Punitive Damages
Jeffrey O'Connell, The Large Cost Savings and Other Advantages of an Early Offers "Crimtorts" Approach to Medical Malpractice Claims
Byron G. Stier, Crimtorts, Class Actions, and the Emerging Mass Torts Method
Keith N. Hylton, A Theory of Wealth and Punitive Damages
Sheila B. Scheuerman, The Road Not Taken: Would Application of the Excessive Fines Clause to Punitive Damages have Made a Difference?
There are several recent articles on the Milberg fallout. The first is an article in the American Lawyer by Alison Frankel on William Taylor III, Milberg LLP's counsel on its recent deal. Here's an excerpt:
In the end, says the lawyer who defended the Milberg firm for more than four years, he had no choice: If Milberg was to survive as a law firm, it had to reach a deal with Los Angeles prosecutors to avoid a guilty plea or conviction in the federal probe of kickbacks to lead plaintiffs in securities class actions.
"The firm had to accept terms which were onerous financially," says the soft-spoken William Taylor III. "I can't tell you I'm happy my client has to pay $75 million." But, he adds, "the firm will survive. Its lawyers can practice law. ... It will be tight [financially] but they have a platform that is well-established [and] they're very good at what they do."
Taylor said the government placed no restrictions on contributions to the firm's $75 million payment by the three one-time name partners who've pleaded guilty, including firm patriarch Melvyn Weiss. He declined to comment on reports that Milberg had asked spin-off firm Coughlin Stoia to contribute and had been turned down. Unlike Milberg, Coughlin Stoia was never indicted in the kickback case.
The other article is by Anthony Lin of the New York Law Journal and reports that ex-Milberg partners are now suing the firm for breach of financial duty. Here's a bit of the article:
Two former Milberg partners have sued the law firm's founder, Melvyn I. Weiss, and the three other firm leaders recently convicted of participating in a scheme that paid kickbacks to class action plaintiffs, claiming the four men's illegal conduct constituted a breach of their fiduciary duty to their partners.
The suits, which came just one day after federal prosecutors agreed to drop criminal charges against Milberg itself in exchange for the payment of $75 million in fines, could be the beginning of a tide of litigation against Weiss, William S. Lerach, Douglas J. Bershad and Steven G. Schulman, the former Milberg name partners who have pleaded guilty over the past several months to orchestrating the kickback scheme.
J. Douglas Richards, one of the two ex-partners to sue Tuesday, predicted as much in an e-mail to the Law Journal.
"Private litigation by those injured by the misconduct is just beginning," he said. Indeed, Milberg management committee member Sanford Dumain said in interviews Monday with the Law Journal and other publications the firm itself was exploring litigation against its former leaders.
Richards and Michael M. Buchman, both former antitrust partners who left Milberg together in January 2007, filed separate pro se complaints Tuesday in Manhattan federal court. Buchman named all four of the former name partners as defendants but Richards excluded Bershad. Richards declined to discuss this aspect of the case, but the exclusion is presumably to preserve diversity jurisdiction, as both Richards and Bershad are New Jersey residents.
Each suit is asking for $3 million in damages.
Tuesday, June 17, 2008
Geoffrey Miller (NYU) just posted an article called "Preliminary Judgments" on bepress. Here is the abstract:
This article proposes the preliminary judgment as a means for facilitating the settlement of legal disputes. A preliminary judgment is simply a tentative judicial assessment of the merits of a case or any part of a case, based on the same sorts of information that the courts already consider on motions for summary judgment. The difference between a preliminary judgment and a summary judgment is that the court, in a preliminary judgment, would not be limited to deciding issues with which no reasonable jury could disagree. Instead, the court would provide its own judgment on the merits of the case based on the information provided by the parties. A preliminary judgment, once given, would convert into a final judgment after the expiration of a reasonable period of time. However, the losing party would have the right to object prior the expiration of the period (with or without explanation), in which case the judgment would be vacated and the case would proceed according to ordinary rules of procedure. Preliminary judgments would increase prospects of success in settlement bargaining by providing litigants with a credible evaluation of case value. Preliminary judgments could offset settlement-defeating party optimism, anchor the parties’ discussions on realistic outcomes, focus attention on basic strategic questions, counteract the danger that attorneys will distort settlements, and enhance the willingness of litigants to accept the outcome. Because preliminary judgments would be announced publicly, moreover, they would provide information to guide future conduct. In point of fact, judges already communicate their provisional views on the merits through a variety of pretrial procedures. The preliminary judgment would represent a more direct, honest and systematic approach to practices which until now have been employed in less transparent ways.
Miller often has interesting, creative proposals and this is certainly one of them. That's why I always enjoy reading his work. I'm going to think more about it, but my first reaction is that there is no existing problem with the current system that this particular procedure is needed to solve. There are several reasons why we might not want more preliminary decisions in cases. One is that if there are some good reasons to have a jury trial to determine a cases' value (I explain these in my article on Bellwether Trials). Judges already have ways to take causation determinations away from the jury if they want to, and whether that is a good or a bad thing is the subject for a serious policy debate. And it is not clear to me that a mini-trial the result of which can be accepted or rejected at the litigant's discretion will really make the process more efficient than it is today. On the other hand, once the judge has decided on an outcome or number through a formal process, how open-minded is that judge going to be going forward? The bottom line, why not just have a full blown, binding trial instead?
Monday, June 16, 2008
For mass tort plaintiffs' lawyers, the scariest legal issue of the moment is preemption. If FDA approval of a warning or product preempts state law tort claims, lots of otherwise viable mass torts disappear. Preemption has figured prominently on this blog in recent months, including here (on the Third Circuit Colacicco decision), here (on the Supreme Court split in Warner-Lambert), and here (on the Supreme Court decision in Riegel).
Plaintiff lawyers' preemption dread picks up on a running theme: tort reform as a supposed death knell for mass tort litigation. A year and a half ago, Byron Stier commented on Alison Frankel's American Lawyer piece declaring the end of the wild west era of mass tort litigation. Two months ago, we linked to a Houston Chronicle interview with a legal recruiter suggesting dim prospects for mass torts in the wake of tort reform. But mass litigators are nothing if not enterprising and resilient. To me the interesting question is not "Will mass litigation dry up?" but rather "If pharmaceutical mass torts and medical devices litigation dry up because of preemption, what's the mass litigator's next move?"
Earlier this month, Forbes.com ran a piece by William Barrett called Looking for Mass Torts. Reporting on the latest Mass Torts Made Perfect plaintiffs' attorneys conference in Las Vegas, Barrett describes the gathering's potent mix of doomsdayism and entrepreneurial verve:
But behind this bravado the lawyers are running scared. After decades of victories in asbestos and tobacco, they are contending with appeals courts rulings reining in class actions involving drugmakers. A case now before the Supreme Court could sharply curtail their bread-and-butter tort suits. The defendants are asking the court to decree that suits built on the theory that drug labels had inadequate warnings are preempted by Food & Drug Administration regulation of labels.
"These are scary times," said R. Larry Morris, another partner in the law firm of Levin Papantonio Thomas Mitchell Echsner & Proctor. Philadelphia lawyer Fred S. Longer made a presentation entitled "fda Preemption: Is This the End?"
But good businesspeople that they are, these legal practitioners are hedging their bets by seeking new markets. One possible new territory where preemption is not a big problem is litigation over environmental debacles. (Witness the recent extraction of money from gasoline refiners who damaged groundwater with a federally approved additive.) The tort mavens also talked about switching to securities law, a field not especially starving for practitioners.
The prospect of mass litigators turning from one type of litigation to another as legal developments alter their cost-benefit analysis is a theme I explore in a forthcoming article on the impact of CAFA. CAFA altered forum-selection strategy directly and indirectly in interesting ways, but beyond that, it appears to have had an impact on claim selection and litigation emphasis as well. Preemption could affect the work of mass litigators even more emphatically than CAFA has.