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Ethicon Media Monitoring 6/23/17
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NJ, 'World's Medicine Chest', Seen as Likely to Be Site of More Pharma Litigation in Wake of 'Bristol-Myers'
Jun 23, 2017 | New Jersey Law Journal
By Charles Toutant
Lawyers handling drug-defect suits say New Jersey courts could see an uptick in volume of pharmaceutical and medical device suits in light of this week's Supreme Court ruling in a California case that narrowed access to jurisdiction for out-of-state plaintiffs. -
What’s Wrong with the MDL System of Conflict Resolution?
Jun 22, 2017 | Mesh Medical Device Newsdesk
University of Georgia School of Law professor, Elizabeth Burch, is not a fan of multidistrict litigation or MDLs. Burch studies mass torts, such as the Kugel mesh case, and is currently working on a book about the MDL system.
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Jun 23, 2017 | New Jersey Law Journal
By Charles Toutant
Lawyers handling drug-defect suits say New Jersey courts could see an uptick in volume of pharmaceutical and medical device suits in light of this week's Supreme Court ruling in a California case that narrowed access to jurisdiction for out-of-state plaintiffs.
The justices' holding on Monday in Bristol-Myers Squibb v. Superior Court of California, that California courts lacked general jurisdiction over suits by nonresident users of the blood thinner Plavix, will send some plaintiffs scrambling for new venues, lawyers said. And they added that New Jersey's status as home to numerous major drug companies could prompt more plaintiff lawyers from around the country to file their cases in this state's courts.
Already the court's ruling has prompted a St. Louis judge to declare a mistrial Monday in suits by one Missouri resident and two from other states claiming that Johnson & Johnson's talcum powder caused users to develop cancer.
The Supreme Court case concerns suits by 86 California residents and 592 residents of other states who filed complaints in California Superior Court alleging that Plavix damaged their health. The nonresident plaintiffs did not allege that they obtained Plavix through California physicians or sought treatment in California. Bristol-Myers has some operations in California but its business activities are mainly in New Jersey and New York, the justices said. For a court to exercise specific jurisdiction over a claim, there must be an affiliation between the forum and the underlying controversy, principally an activity or occurrence that takes place in the forum state, the justices said in the 8-1 opinion.
"This is all about preventing the practice of forum-shopping and it's about preventing a plaintiff from joining a corporate defendant to a state court case where a defendant cannot reasonably be expected to be haled into court," said Neal Walters of Ballard Spahr in Cherry Hill, who represents defendants in drug-defect suits. "Courts have established a bright-line rule: the only time you can hale a corporate defendant into a particular state court based on general personal jurisdiction is where that state is the home of the corporation," he said.
Courts in New Jersey and elsewhere see some filings that lack a connection to the forum state, just as in the California case, although it's difficult to estimate how widespread the practice is, said Walters. By no means is the phenomenon confined to drug cases, and the ruling will impact a variety of cases, he said.
In Missouri, where Johnson & Johnson has tried five cases over allegedly cancer-causing properties of its talcum powder, and in four of those plaintiffs prevailed. In those cases, Bristol-Myers puts those verdicts in jeopardy on appeal, said Wilfred Coronato, a McCarter & English lawyer who represents drug companies in products liability suits. He also forecast that New Jersey is likely to see more drug cases filed as a result of the court's ruling.
"New Jersey is known as the medicine chest of the world. More than a dozen of the largest pharmaceutical companies are located in New Jersey. So many pharmaceutical companies are, in the words of the Supreme Court, fairly regarded as home in New Jersey, subject to suits by residents and nonresidents alike. Plaintiffs lawyers who are looking to file large inventories of cases in a single state, where their large inventory might be from plaintiffs who hail from various states, can file in New Jersey because they're subject to general jurisdiction," Coronato said.
Christopher Placitella, of Cohen, Placitella & Roth in Red Bank, who files drug suits in behalf of plaintiffs, said he does not believe many New Jersey cases will be deemed improperly venued as a result of the Supreme Court ruling. He thinks the ruling's impact on New Jersey will not be significant but some suits that might have otherwise been filed elsewhere may end up in this state's courts.
"I don't see a major sea change in terms of the kinds of cases that are filed here. You may see more out-of-state residents file [in New Jersey courts] if they feel they have nowhere else to go," Placitella said.
New Jersey could see more filings of drug suits because plaintiffs' residency doesn't matter if the defendant is based in this state, said Adam Slater of Mazie, Slater, Katz & Freeman in Roseland. Slater represents plaintiffs in suits over alleged side effects of blood pressure drug Benicar and over alleged defects in pelvic mesh made by Johnson & Johnson subsidiary Ethicon.
"The only impact on New Jersey is there will be more cases filed in New Jersey going forward," Slater said. "Anyone can sue J&J in New Jersey," he said.
Filing suits in a state where neither party has a nexus, a practice at the center of the Supreme Court case, is not commonplace in New Jersey, Slater said.
"For me, in New Jersey, I would say this is business as usual. It doesn't change what we're doing," Slater said of the decision.
http://www.njlawjournal.com/id=1202790968765/NJ-Worlds-Medicine-Chest-Seen-as-Likely-to-Be-Site-of-More-Pharma-Litigation-in-Wake-of-BristolMyers?slreturn=20170523012116
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What’s Wrong with the MDL System of Conflict Resolution?
Jun 22, 2017 | Mesh Medical Device Newsdesk
University of Georgia School of Law professor, Elizabeth Burch, is not a fan of multidistrict litigation or MDLs. Burch studies mass torts, such as the Kugel mesh case, and is currently working on a book about the MDL system.
According to her research, collecting data from 72 product liability pending as of May 2013, 70 law firms had attorneys who were named to five or more leadership roles in the MDLs. Calling them “repeat players,” Burch writes that 16% of the involved law firms held nearly 54% of all leadership positions.
What’s created is a two-edge sword.
On one hand, high-stakes multidistrict litigation is managed by lead lawyers with trial experience who are best equipped to bring cases to settlement. On the other hand, the judges are relatively powerless to police these private settlements created by the MDL.
Professor Burch published, Judging Multidistrict Litigation in April 2015, and she talks to Mesh News Desk about her findings.
Q: Akre – The MDL steering committees, you call them repeat players since the same law firms represent 63% of all mass torts. How do they get into those enviable positions?
A-”The judge is the one who decides who will lead the litigation. There are a lot of different methods to decide. Some will say – pick your own people and bring me the consensus and the judge then confirms the slate. The slate could be heavily populated with people who have done this before.
“They have the pull and capital to get everyone to vote for them.
“Long before there even is an MDL they are posturing so they know the most about a particular lawsuit.”
Q-Should that be a concern for the plaintiff?
A-“On one hand repeat players have done this before.
“After litigation against JNJ (Johnson & Johnson), you have lawyers who have dealt with them on talc, strategy, hip implants, and that’s the upside.
“The downside potentially is you have repeat players on both the defense and plaintiff side. JNJ uses the same lawyer over and over again and they deal with each other and may develop a quid pro quo relationship.
“I don’t want to say they go into a back room, but you develop these working relationships where “You know what I need….”
“The plaintiff lawyers negotiate to increase their common benefit fees, so every plaintiff agrees to settle also agrees to the increased fees they’ve negotiated with the defendant.
“The defendant, in return, can negotiate for things it wants. You want finality, for example. You can have a walkaway provision, where basically it says, ‘Unless we get x percentage of the plaintiffs to agree to this, we walk away from the deal and the deal is off. ‘ That ranges from 85% to 100% of plaintiffs who must agree to the deal.
“Some of the provisions aimed at the lawyers say you must recommend this deal to 100% of your clients. Some plaintiffs might not be in the same boat, but by agreeing to this settlement, you’re agreeing to recommend it to everybody!
“Some other settlements say if you have a client who doesn’t want to settle you have to drop them like a hot potato. It’s unethical yet it’s done. That’s the tit-for-tat I’m talking about.”
Q-In the mesh MDL the common benefit fund is 5% and Judge Goodwin has not specified who is to fund it. Most plaintiffs are told they must pay the 5%. At the same time MDL lawyers are charging plaintiffs 40%. Are these costs excessive?
A- “Different states set caps on what an attorney can charge. I don’t know where 40% came from. Thirty-three percent is typically the norm.
“With a common benefit fund, every plaintiff has to put 5% into the kitty. Some lead attorney are also forcing them to pay to package claims together.
“If I’m in Athens, Georgia, I represent only five plaintiffs, and Bard says I will only settle if you bring me 1,000, I can’t do that.
“The lead lawyers are charging them between 25% of individual attorney fees to process claims together on top of 5% common benefit fee.
“The problem comes when I try to figure out how to best represent my client. The only way to settle is to pay $3,000 a case and I can’t go to trial then and I can’t press for a better settlement. I have no leverage, you’re stuck in huge MDL yet you can’t do anything other than package for a small settlement.
“In theory the Plaintiff fees – if I charge you a 30% fee and lead lawyers are charging me. It should come out of the attorneys’ fees. There have been judges who have stepped in and cut individual attorney fees, for example in Vioxx, Judge Fallon and Zyprexa litigation. They’ve gone in and said your individual lawyer has not done 40% worth of work, it’s an unjust fee and I will come in and cut it.”
Q-Is it fair to say you’re not a fan of the MDL system?
A-“I’m not a fan of how they are handled. Some judges do a better job of policing the repeat player than others. But there are systemic problems in MDLs. One example – there was litigation on Propulsid, an earlier MDL and in my database.
“The lawyers recovered over $22 million in common benefit fees. There were over 6,000 claimants in the MDL proceeding. The lawyers negotiated a strict process for settlement. First, a panel of doctors decide on causation. As soon as you opt into the settlement, you don’t know if you will recover, but you’ve given up your right to sue in court.
“Of those 6,000 plaintiffs, 38 recovered money…they recovered $6.5 million in total. The lead lawyers made over $22 million, $8 million went to Canada’s program and $8 million to the Louisiana Public Health Initiative, since Judge Fallon is in Louisiana.
“Only $6.5 million went to the plaintiffs. The rest of the fund went back to JNJ, the defendant. The lawyers said that was the template for all mass torts. And they never tried to get the products off the market.”
Part Two- How does the SCOTUS decision Monday might affect the MDL?
http://www.meshmedicaldevicenewsdesk.com/whats-wrong-mdl-system-conflict-resolution/
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