March 7 (Bloomberg) -- U.S. Chief Justice John Roberts is one shareholder Pfizer Inc. might be better off without.

Roberts's Pfizer stake, which is worth between $15,001 and $50,000, almost certainly led to a Supreme Court deadlock this week that allowed lawsuits over the company's Rezulin diabetes drug. Roberts, 53, didn't take part in the case, and the court split 4-4, leaving Pfizer one vote short of stopping the suits.

``If you're on the industry side, it kills you that Roberts recused himself,'' said Mark Herrmann, a product-liability lawyer at Jones Day in Chicago. ``That's your fifth vote.''

Roberts's recusal, and others this term, have fueled calls for the nine justices to shed their stock holdings and put the money into funds or other investments less likely to create a conflict of interest.

``They ought to be encouraged to dump the whole portfolio,'' said Richard Painter, a law professor at the University of Minnesota in Minneapolis. Painter, who was President George W. Bush's chief ethics lawyer and worked on the nominations of Roberts and Justice Samuel Alito, called stock ownership by jurists ``a huge problem.''

Five days before the Pfizer deadlock, the court considered the $2.5 billion punitive damage award for the 1989 Exxon Valdez oil spill without Alito, 57, an Exxon Mobil Corp. shareholder. In January, the court ruled on shareholder lawsuits with no input from Justice Stephen Breyer, 69, who owned shares of Cisco Systems Inc., the parent of a company involved in the case.

Six Cases

The Pfizer and Exxon cases are among six scheduled cases the court is considering in the 2007-08 term without all nine justices. The 4-4 split in the Pfizer case is the second of the term for the court, which also divided evenly when Justice Anthony Kennedy didn't participate in a special-education case.

Four-to-four rulings resolve the individual case by upholding the lower-court decision, though they don't set a nationwide precedent.

``When we have a 4-4 decision, it creates uncertainty in the law,'' said Ronald Rotunda, an expert on judicial ethics at George Mason University's law school in Fairfax, Virginia. ``We know it's important enough for the court to take, but we don't know the answer.''

The justices rarely say why they are disqualifying themselves from a case, although their annual financial disclosure reports often provide a likely explanation. The reports list investments owned by judges, their spouses and dependent children and show the approximate value of the holdings.

Exxon Mobil

Alito's absence from the Exxon Mobil case might deprive the company of the fifth vote it needs to wipe out the damage award or get a new trial. Instead, the court may simply order a reduction in the record $2.5 billion award.

The prospect of a 4-4 deadlock in the 19-year-old case troubles some court watchers. ``An important issue will be unresolved, the justices' time will be wasted, the parties' money will be wasted, and all over what is likely just a few thousand dollars' worth of investment,'' University of California at Los Angeles law professor Eugene Volokh wrote on his blog, the Volokh Conspiracy.

Alito's stock holdings in Exxon Mobil were in the $100,001 to $250,000 range, according to his 2006 disclosure form. He didn't respond to a request for comment about his recusal policy. Roberts and Breyer declined to answer questions.

Kennedy and Thomas

Stock holdings aren't the only reason justices stay out of cases. Kennedy and Justice Clarence Thomas stepped aside in cases involving companies that employ their children, according to Legal Times.

What distinguishes stock-based recusals is that they could be easily avoided, some experts say. Under a 2006 law, enacted at Roberts's urging, justices can defer capital-gains taxes when they sell stocks and put the money into a qualified fund to avoid a potential conflict of interest.

Roberts's most recent disclosure form indicates he is reducing individual company stock holdings. He sold a dozen securities in 2006, including Coca-Cola Co., Johnson & Johnson and State Street Corp.

Even so, Roberts's sales have raised questions about timing and consistency. In each of the last two terms, he disqualified himself from a case, then reversed course and took part. A likely explanation was that he sold the stocks that created the conflict -- Citigroup Inc. in one case, Cisco in the other.

Roberts hasn't said why he took a different approach with Pfizer. One possibility is that, in each of the earlier cases, another justice also was recused, meaning Roberts's participation gave the court eight members and averted a possible 4-3 decision.

Questioning Wisdom

Some experts question the wisdom of taking part in a case after initially being disqualified. ``Recused ought to be recused,'' said Steven Lubet, who teaches legal ethics at Northwestern University's law school in Chicago.

Lubet is among those who don't see stock-based recusals as a major problem, pointing to the rarity of 4-4 decisions. The two this term were the first since 2003. He nonetheless said the justices should start disclosing why they remove themselves from a case.

``People are going to guess anyhow,'' he said. ``The public might as well have the actual reasons.''

To contact the reporter on this story: Greg Stohr in Washington at gstohr@bloomberg.net.

Last Updated: March 7, 2008 00:06 EST