Loss in Zyprexa Case Was a Disaster for Attorney General Jim Hood
Last night Ya’ll Politics reported a ruling by a New York federal judge that basically threw out Attorney General Jim Hood’s lawsuit against Eli Lilly & Co. over off-label marketing of the anti-psychotic drug Zyprexa. Ya'll linked this report from Legal Newsline. Here is the actual 117 page opinion in the case.
This looks like a disaster for General Hood. First, Mississippi loses and collects nothing while other states settled similar claims and made substantial recoveries:
“Of the 12 states that did not settle their claims against Eli Lilly in a 33-state, $62-million agreement five have already made their settlements official and others have tentative agreements. The states that have settled are:
-Connecticut settled for $25.1 million;
-West Virginia settled for more than $22 million ($6.75 went to outside counsel hired by state Attorney General Darrell McGraw);
-Idaho settled its case for $13 million ($2.5 went to outside counsel hired by state Attorney General Lawrence Wasden);
-Utah settled for $24 million (more than $4 million went to outside counsel hired by state Attorney General Mark Shurtleff); and
-South Carolina settled for $45 million (more than $6.5 million went to outside counsel hired by state Attorney General Henry McMaster).
Eli Lilly has paid $1.4 billion to settle federal civil and criminal claims stemming from alleged off-label marketing.
The payment also benefited the Medicaid programs of more than 30 states that collectively received approximately $362 million.”
Eli Lilly hemorrhaged money to settle the Zyprexa claims and Mississippi, with its budget in ruins, gets nothing.
Second, as if the loss was not bad enough, the article revealed that Hood’s hand-picked outside counsel donated substantial money to Hood:
Bailey Perrin, which donated $75,000 to Hood, is also representing the states of Arkansas, Pennsylvania and Louisiana.
$75,000??? From a law firm in Texas? Why in the world, other than the obvious reason, would a law firm in Texas be donating $75,000 to the Mississippi Attorney General? Did they also donate $75,000 to the A.G.’s in Arkansas, Pennsylvania and Louisiana?
According to the Court’s opinion, Mississippi was also represented by William Quinn of Booneville (now Ridgeland). Quinn was working for Joey Langston at the time of Langston’s downfall and is generally credited for master minding the State’s claim against Worldcom that resulted in a $14 million fee for Langston.
This is more ammunition for Hood’s critics in general, and the critics of the State’s system of allowing the A.G. to hire and pay outside counsel in particular.
I do not have a problem with the A.G. hiring outside counsel, in theory. But a Texas firm who donated $75,000 to Hood? Let’s be honest—that does not look good. There are plenty of good lawyers in Mississippi who could represent the State and need the work. But there is probably a shortage of non-incarcerated (former) Mississippi lawyers who donated $75,000 to Hood.
Hood is going to end up giving his critics enough ammunition to get the State Legislature to enact a law that restricts the A.G.’s ability to hire outside counsel.
As for Hood’s political future, there are no threats on the horizon to his position as A.G. But for a higher office such as governor, the $75,000 donation from Texas lawyers may do more harm than good.
Quin, not Quinn, right? Of McCraney, Montagnet & Quin in Ridgeland?
Don't know if you caught it but the Gov's motion for rehearing in Price v. Clark was denied today
So many problems with your post, where does one begin:
1. Legal"news"line is not a news source at all. It is the public relations arm of the US Chamber. When you give anything this outlet says credence, you are destined for trouble. Yours is typically a fair minded "new media" source. I am disappointed.
2. While you link the 117 page decision, is apparent that you must not have read it. Summary judgment was only rendered in part, and on questionable grounds. The court found that, in order to make a fraud/product liability/consumer protection claim, the State must come forward with individualized proof of every prescription. There are over a million prescriptions. In effect, the court's ruling immunizes pharmaceutical companies from even intentional tortious conduct. It is the "too big to fail" principle in reverse. Call it "too large a tort to prosecute."
3. Yet, the court preserves the State's drug cost claims under the fraud, product liability and consumer protection statute. The State's alleged damages in this regard are approx. $15 M to $122 M. So, the net result of the decision is that the State can continue to seek $15 to $122 M in damages, but not seek penalties for violation of the consumer protection statute. You're a fair minded guy, so tell me - how can that be? How can there be a violation of the state's consumer protection statute and the trial judge (who would be a MS federal judge and not an MDL judge in Brooklyn) not be vested with authority to penalize the offender? Doesn't make sense; and, I believe it to be legal error.
3. Now, to your mistatements, you say that "[t]his looks like a disaster for General Hood. First, Mississippi loses and collects nothing while other states settled similar claims and made substantial recoveries." If you do nothing else with regard to this post, you should at least correct this misstatement. MISSISSIPPI HAS NOT LOST. Compare Mississippi's damages ($15 M - $122 M) to the settlements contained within the article you cite and ask yourself: Does MS have a claim which falls within the range of settlements set forth? Of course it does.
4. Bailey Perrin is a large Texas firm that does nothing but anti-psychotic drug litigation. That firm represents the states of Louisiana, Arkansas, Pennsylvania, Mississippi, Alaska and others, not to mention the class and individual claims it has handled. It is well qualified to work this case, and Quin did well to associate them.
If you want to criticize Hood for allowing Quin to associate a firm that gave Hood $75,000, that is fair game and such is politics. It is, however, unfair and lazy for you to paint a decision you obviously have not read as something it is not in order to lend credence to your belief that significant contributors, no matter their competence, ability and expertise, should not represent the state.
I enjoy reading your blog, but your comments that "this was a disaster for Hood and that
“Mississippi loses and collects nothing are off base and unsupported.
If you read the decision that you linked, you will see that the case is far from over. In fact, Judge Weinstein's decision only granted summary judgment with respect to certain types of damages, i.e., damages for diabetes related expenses, and consumer protection act penalties. If you read page 96 you will see that all of the claims (product liability, negligence, consumer protection act, fraud) survived summary judgment, and the damages recoverable are discussed on pages 52-55 of the opinion (between 15 and 122 million).
I understand the concern about hiring out of state counsel and of the perception caused by the contributions, but THIS DECISION should not be viewed as "ammunition" for Hood's detractors. As usual,Legal Newsline (which is actually the arm of the Chamber of Commerce) is taking bits and pieces of information to support its obvioius agendas to protect businesses that defraud our state and our citizens. That tort reform machine continues to mischaracterize the facts, and we don't need to help them by blindly accepting their characterizations. Read the decision.
Smith,
Where did you get the information for the Mississippi damage model?