Monday, April 23, 2001
DRUG WARS
By John Ryan - California Law Business
Beaten by huge pharmaceutical companies with huge arsenals of millions of dollars, small plaintiffs' firms are pooling their resources to launch a new wave of mass tort litigation-giving Corporate America a taste of its own medicine.
On Nov. 29 Jennie Stern suffered a hemorrhagic stroke-a blood vessel burst in her brain-that caused permanent damage.
She lost all peripheral vision, forever to see the world in tunnel vision. She will never be able to drive a car. Her limited vision makes walking difficult, as does the partial numbness that has remained on the right side of her body. Stern needed a walker at first, and now uses a cane. She has trouble finding the right words to describe things. She'll put an object down for a few seconds and forget why she was holding it in the first place.
Stern was only 24 years old when the stroke occurred, and before that November day had never suffered a major health problem.
Stern's stroke may have been caused by the drug Phenylpropanolamine-PPA for short-which the U.S. Food and Drug Administration considered a safe ingredient in virtually every common cold remedy and diet aid until a team of Yale doctors linked the drug to hemorrhagic stroke last year.
Though the products no longer contain PPA, that is little consolation to Stern. The Robitussin she took for a cold in the weeks before her stroke contained PPA. She also had been chewing the diet gum Thin-Ez, which likely contained PPA, as well.
Stern and many other alleged victims of PPA have turned to the law firm of Lopez, Hodes, Milman & Skikos, based in Newport Beach. The 21-attorney firm specializes in mass tort litigation against the pharmaceutical industry and in medical malpractice.
"The pharmaceutical industry knew what PPA could do for 15 years," managing partner Ramon Lopez says of Stern's case and similar ones. "And they're going to pay for that" he adds.
This is not an empty threat.
Lopez and his firm have achieved national recognition for successfully taking on the world's biggest drug companies and their defense firms. When FDA-approved prescription and over-the-counter drugs turn out to harm the consuming public, Lopez Hodes usually makes someone pay.
"They are the new stars in the sky of the legal community," says Mark Robinson, of Newport Beach's Robinson Calcagnie & Robinson, who was plaintiffs' co-counsel on the Ford Pinto fire case against Ford Motor Co., which produced a $128 million award. "They are finally being noticed and enjoying the acclaim they probably deserved for well over 10 years," Robinson adds. His firm and Lopez Hodes work together regularly on mass tort litigation.
Robinson is just one of many plaintiffs' lawyers nationwide who say that the importance of the work done by Lopez and his firm goes beyond winning large verdict and settlement awards.
By banding with other small and midsized firms, Lopez has helped change the way the plaintiffs' bar handles mass tort litigation. The alliance has enabled plaintiffs' lawyers to match the tremendous resources pharmaceutical companies devote to their legal defenses.
"It's a long-overdue leveling of the playing field," says partner Alex MacDonald of Boston's Robinson & Cole. MacDonald worked on the Fen Phen diet-pill litigation with Lopez Hodes and is doing so again with PPA. The notion of pharmaceutical litigation as a David vs. Goliath undertaking is now an antiquated notion," he says. "This represents a very significant improvement in our civil legal system."
The alliance also has dealt a blow to the pharmaceutical industry, making it pay for bad products rushed to market. In doing so, plaintiffs' firms have put the FDA "under the microscope," as Lopez says, for approving these drugs on a fast-track basis in the first place.
Lopez is not the brainchild behind plaintiffs' alliances that save time and marshal resources. However, with more than a decade in the plaintiffs' trenches, he has made the new alliances much more effective, and thus much more powerful.
Alliances among the plaintiffs' bar have been particularly successful in recent multidistrict litigation, also known as MDL. MDL counsel dates hundreds to thousands of tort actions filed at the federal level under one judge. The judge appoints plaintiff and defense committees that review discovery documents and assemble "generic" witnesses whose testimony can be submitted in each individual case.
Likewise, mass torts filed in state court often are consolidated under one state judge, who also appoints plaintiff and defense committees. The committees appointed in both the state and federal actions can share documents and witnesses.
Lopez first used the federal and state committee processes during the silicone breast implant litigation against Dow Corning Corp. He was hired by his first client in the litigation in 1990 and wound up with a total of 660 clients by the mid-1990s.
Until then, he and partner Dan Hodes managed a successful medical malpractice, products liability and personal injury practice. When breast-implant litigation exploded in 1992-1993, the firm had just seven attorneys.
Lopez saw the benefits of the state and national committee work, but also its flaws. Sharing information, ideas and trial strategies was helpful, but the alliance wasn't sufficiently organized.
"Plaintiffs' lawyers didn't do a very good job working together nationally or even statewide as a single unit," he explains. "There were a lot of newcomers to mass tort, including us. I believe that was our downfall in breast implants."
Without a truly coherent plaintiffs' team, Dow Corning's "scorched-earth" strategy took its toll. The litigation lasted more than six years and left the plaintiffs' attorneys working on the cases "sleep-deprived."
"Up until then we were an Orange County firm handling Southern California cases," he says. "Breast implant gave us national exposure and put us in a national leadership position for the next big mass tort which was diet pills."
Diet-pill litigation picked up in 1997 after the Mayo Clinic reported finding a heart valve dysfunction associated with Fen-Phen users. The diet drug also led to cases of primary pulmonary hypertension, a progressive disease with no cure.
"After our experience with breast-implant I knew I was not going to be one to rely on just anybody to do the significant work for us," Lopez says.
Lopez took control of the diet-pill multidistrict litigation, establishing an alliance of 10 firms he trusted to do the important work of document discovery, locating experts and deposing witnesses.
The increased work provided Lopez with some peace of mind.
Depositions that underuse key expert witnesses are absolutely devastating in national mass tort work, Lopez says, where one "generic" expert witness is needed for hundreds of thousands of individual cases across the country.
"We saw that in breast implant and saw the potential for it in Fen-Phen," Lopez says. "That's the reason why we wanted to be very intimately involved."
Robinson & Cole's MacDonald joined the diet-pill litigation after filing a case in Massachusetts state court. That was MacDonald's first experience with national mass tort litigation, and he was impressed.
"It was a classic example of synergy," he says. The collective group was greater than any of its component parts."
Partner Bryan Aylstock of Levin Papantonio Thomas, Mitchell Echsner & Proctor in Pensacola, Fla., whose firm also worked on breast implant litigation, noticed a much stronger alliance in the diet-pill cases.
"With diet pills we coordinated nationally in a more formal way and presented a united front" he says. The drug companies' "scorched earth" strategy can't work, he explains, when the plaintiffs' attorneys cover every deposition and review each document skillfully.
"We had an expert in San Francisco that we needed for one of our cases, and we had the ability to call up Ramon and ask one of his guys to cover the deposition," Aylstock explains.
Lopez Hodes, in turn, relied on Levin Papantonio to depose witnesses on the East Coast. The work of the Fen-Phen multidistrict litigation team was a success, resulting in a $4 billion settlement with American Home Products, which makes Fen-Phen, in October 1999.
Lopez Hodes advised clients with the strongest cases against American Home Products to opt out of the deal, which is what most of their 2,000 or so clients did.
According to Lopez, the firm successfully settled the vast majority of these cases in the year following the global settlement. American Home Products now is expecting to pay an additional $7 billion or more in settlements arising from the Fen-Phen litigation.
The plaintiffs victory in the diet-pill litigation marked a turning point in mass tort litigation. More than just "leveling of the playing field," Lopez believes the advantage even tipped to the plaintiffs' side.
"When you add us together we're bigger and stronger than any defense firm," he says of the plaintiffs' alliance. They can't scorch-earth us to death. We put the scorched-earth strategy on them."
With 99 percent of his firm's Fen-Phen cases settled, Lopez's alliances have remained intact for ongoing litigation.
The FDA approved Parke-Davis' Rezulin in 1997 to treat Type 11 diabetes and removed it three years later after it was linked to liver failure.
Janssen Pharmaceutical's Propulsid was removed by the FDA last summer after a seven-year period on the market, during which it was associated with irregular heartbeats.
The multidistrict litigation status for both Rezulin and Propulsid is roughly the same: Millions of documents have been collected with millions more on the way, and the attorneys are preparing to depose drug-company personnel and outside medical experts. PPA litigation is less developed, with plaintiffs' attorneys still working on the company of clients like Stern.
Lopez anticipates that roughly 1,000 PPA related cases nationwide will be filed by the summer. Although PPA hasn't yet become a multidistrict litigation, that hasn't stopped Lopez from getting a head start. Ironically, now that he's helped perfect the MDL process, he's content to do without it while keeping his alliance of 10 or so firms in place.
"We've kinda put together our own steering committee to handle our own cases for PPA," he explains.
He adds that after Fen-Phen, the competition and infighting to get on the national committees has hampered the process.
He and his team aren't going to wait around to see if multidistrict litigation will be formed, which judge will be assigned the caseload or whom that judge will select to work on the committees.
"We're going to function like an MDL for our own cases," he says.
The work, Lopez explains, is simply too important to fall victim to politics, egos or scheduling delays.
"We would like to reform the way the pharmaceutical companies do business," Lopez says."And we get that much closer with each victory."
The attorneys he works with also consider themselves crusaders.
The plaintiffs' tort bar has been by default a major arm of the reform movement in the United States," MacDonald says. "Schools got desegregated by plaintiffs' attorneys."
He sees the battle waged against the pharmaceutical industry similar to the one currently being waged against the tobacco companies.
The threat of lawsuits is often the way to ferret out the truth, to find the internal documents that are often embarrassing," he says.
The ball, it seems, is now in the pharmaceutical industry's court.
If companies continue to downplay the risks of their drugs for the sake of profit Lopez and his attorneys will continue to fight them.
"The bottom line," Lopez says, "is that you just have to let people make their own choices on what risks they want to put themselves at."
"Do people want to lose 5 pounds over a period of a month by taking a pill instead of doing something different if that pill is going to put them at risk of having a stroke that could paralyze them for life?"
