Merck Vioxx Lawyers Get More Fees After Filing Objections

Some plaintiff lawyers involved in Merck & Co.’s $4.85 billion Vioxx settlement were given more in fees by a judge after they objected to their original awards, court papers show.

U.S. District Judge Eldon Fallon in New Orleans, who is overseeing the remaining litigation over Merck’s withdrawn painkiller, yesterday awarded at least $3 million to attorneys who had complained that colleagues were hogging the lion’s share of more than $315 million in fees spawned by the accord.

“Although this allocation process seems tedious and time- consuming, the court finds the process was necessary to achieve a reasoned and appropriate result,” Fallon said in his 132-page ruling.

Merck won 11 of 16 Vioxx lawsuits that went to trial in both state and federal courts before agreeing in November 2007 to settle almost 50,000 claims of users who blamed the drug for heart attacks and strokes. Lawyers who worked on a consolidation of Vioxx cases were entitled to split $315.3 million in fees for their work on those suits.

Vioxx suits filed in federal courts across the U.S. were consolidated before Fallon for pre-trial evidence gathering and so-called “bellwether trials,” which were designed to help resolve issues in the cases.

Four Objectors Left

A court-appointed committee of Vioxx lawyers made fee recommendations and that generated objections from 18 law firms, Fallon said. All but four of the objecting firms later agreed to a special master’s recommendation on how the fees should be split, the judge noted in his decision.

Objectors, such as New Mexico-based lawyer Turner Branch, argued in court papers that the committee’s fee allocation lacked “any rational basis.” The committee had recommended he receive $190,000 for his work on the consolidated Vioxx cases.

Given that Branch’s work on Vioxx cases in New Jersey had “a salutatory effect on the ultimate resolution of the Vioxx litigation,” Fallon decided to increase the lawyer’s fee to $500,000, according to court filings. Branch didn’t immediately return a call for comment on the fee award today.

Jose Escobedo, Texas lawyer who won a $32 million verdict against Merck over Vioxx in 2006, also objected to the committee’s recommendation that his law firm receive no award for its contribution to the litigation.

‘Rippling Effect’

Escobedo argued that his firm’s work on behalf of the family of Leonel Garza, who suffered a 2001 heart attack after taking Vioxx, deserved compensation. Jurors in state court in Texas awarded Garza’s family $32 million after finding the company didn’t properly warn patients about the drug’s risks. A judge later reduced the award to $8.73 million.

The fee committee recommended no award because Escobedo decided to opt out of the Vioxx settlement and didn’t share his work on Garza’s case with other lawyers, according to court filings.

Escobedo countered in his own filings that the verdict was among only five won by plaintiffs at trial and it helped keep the pressure on Merck to settle.

“A strong argument can be made that a rigorous presentation in any trial in any court attacking Merck’s actions or inactions regarding Vioxx will have some salutary rippling effect on all other cases,” Fallon said. He awarded Escobedo’s firm, Escobedo, Tippit & Cardenas, $1.6 million in fees. Escobedo didn’t return a call for comment today on the fee.

Higher Fee

Kathryn Snapka, another South Texas-based lawyer who was Escobedo’s co-counsel on the Garza case, also objected to the $75,000 fee the committee awarded her. She argued she played a larger role than Escobedo in the consolidated cases and deserved a higher fee. The judge agreed, awarding her $1.1 million. Snapka, based in Corpus Christi, Texas, didn’t return calls for comment today.

The awards were a fraction of what the two lawyers originally sought in fees over the consolidated Vioxx cases, Fallon said in the ruling.

“Collectively, Snapka and Escobedo Tippit requested 10 percent of the entire common-benefit fund or $31.5 million between them,” the judge noted.

Fallon was able to provide more money for objectors by reducing awards to some law firms that received the largest fee awards for the consolidated cases, according to court filings.

For example, the judge shaved about $200,000 from the $36.8 million in fees awarded to the Montgomery, Alabama-based law firm of Beasley, Allen, Methvin, Portis & Miles.

Andy Birchfield, one of the firm’s partners, served as one of the lead counsel for the consolidated cases. Birchfield didn’t return a call for comment today on the judge’s Vioxx fee award.

The case is Vioxx Products Liability Litigation, MDL-1657, U.S. District Court, Eastern District of Louisiana (New Orleans).

To contact the reporters on this story: Jef Feeley in Wilmington, Delaware at jfeeley@bloomberg.net; Sophia Pearson in U.S. District Court in Philadelphia at spearson3@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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