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Emerging Drugs & Devices
7/11/2008 4:11:48 PM EST
Tom Moylan
In Brooklyn, Judge Weinstein Swings A Mean Carrot-And-Stick
Posted by Tom Moylan
LexisNexis Torts Law Center Staff

Eli Lilly and Zyprexa third-party plaintiffs were thrown into the judicial equivalent of a cage match July 2 by the ever-innovative Judge Jack Weinstein.

Asked to certify or deny a RICO class, the Brooklyn federal judge just didn’t issue an up or down opinion: he issued a draft of a 291-page opinion certifying an overpayment class action, ready-to-sign and somebody-hand-me-a-pen. The message to Zyprexa maker Eli Lilly: the MDL court is ready to rock and roll with class notice and a trial. The message to the third-party plaintiffs: the draft would also certify interlocutory appeal to the Second Circuit, so get ready to cool your heels. The message to both (listed twice, in case they missed it): it would be much better to settle this, perhaps through a class settlement, if you catch the judge’s drift.

No one should be all that surprised at Judge Weinstein’s method. When Lilly reached a private settlement with about 8,000 individual Zyprexa claimants, some judges might have been content to let private parties handle a private settlement. Not him: deeming it a “quasi-class settlement,” Judge Weinstein wasted no time appointing several special settlement masters. Noting the financial status of many Zyprexa plaintiffs, he pushed for quick claims processing and payments.

Then the Medicare/Medicaid Monster appeared with the usual state/federal mantra: we have liens and we’ll need time to figure out who owes us, so put all the awards on hold while we go through records one-by-one and see how much is owed and oh by the way this may take several years. Judge Weinstein recognized statutory liens, but would have none of the delay: he gave the feds and all 50 states a very short deadline to decide whether to take a lump settlement. Then he crafted an order for Medicare/Medicaid set-aisdes and ordered checks cut for plaintiffs. If plaintiffs wanted to know where the rest of their award was, they could ask their state and federal governments.

After a second wave of individual claims, Lilly reached other settlements, leaving a small number of individual cases unsettled. Judge Weinstein ordered them administratively closed unless the plaintiffs could prove they shouldn’t be. When some moved to remand, he denied the motions, saying the MDL court is more well-versed in the litigation and best able to handle them. That might raise some Lexecon questions, but in Brooklyn it’s Judge Jack’s Way or the Brooklyn-Queens Expressway.

A hearing is set for July 17. We’ll know then whether Judge Weinstein’s “quasi class certification” forces a settlement.

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