A Failure of Remedies: The Case of Big Pharma (An Essay)

By Paul J. Zwier and Reuben Guttman
Emory Corporate Governance and Accountability Review
Emory Law

This article examines the U.S. pharmaceutical industry and the harms imposed on individual patients and healthcare consumers—including private and government third party payers—from practices proscribed by Federal and State laws regulating marketing and pricing.

The article pays particular attention to the False Claims Act (FCA), which has become the government’s primary civil weapon against fraudulent and/or wrongful conduct causing the expenditure of government dollars.
Read the entire Essay at http://law.emory.edu/ecgar/content/volume-3/issue-2/essays/failure-remedies-case-big-pharma.html

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LEADING: Partner Traci Buschner to moderate Ethics panel at the FBA Qui Tam Conference.

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The Art of Advocacy

Judges are now insisting that plaintiffs make their case with facts instead of merely putting their clients on notice of a claim.

When the United States Supreme Court issued its decisions in Bell Atlantic Corp v Twombly, 550 U.S. 544 (2007) and Aschroft v Iqbal , 556 U.S. 662 (2009), there was sea change in the standard by which judges evaluated lawsuits to determine their sufficiency to withstand a motion to dismiss.  Rather than merely placing a defendant on notice of a claim, the Court established a new standard.  Plaintiffs must allege facts allowing a court to find that a claim is plausible.  In reviewing the allegations of the complaint, courts are challenged to weed out conclusory statements and base their analysis on only the factual pleadings of the Complaint.

Naturally, Iqbal and Twombly have raised serious access to justice issues for plaintiffs who must muster the facts without an opportunity to gather evidence through discovery.  The “plausibility” standard is of course entirely subjective; what is plausible to one judge based on his or her life’s journeys may not be plausible to another.  And with the challenge to plead facts, plaintiffs are undoubtedly encouraged to put the “kitchen sink” into their complaints and plead complaints that are exponentially larger than those of yesteryear.

With all of the problems caused by Iqbal and Twombly, there is a nugget of gold that can be snatched as a teaching lesson.  The notion that litigants are instructed to make their cases based on facts and not conclusions or hyperbole, is a solid concept.

The question of what is a fact and what is a conclusion is of course a lesson that lawyers must understand.  In one of my classes at Emory Law School, I asked the students to outline the good facts and bad facts for a case involving assault and robbery. A student raised his hand noting that a good fact for the Defendant is “he has an alibi.”  I turned to the student and said, “Are you telling me a fact or are you giving me a conclusion?”  The student looked at me.  I said, “unpack what you just told me in terms of the evidence, or facts, that support the alibi.” The student then began to tell me about a witness who saw the defendant at a theater performance at the time of the alleged incident; theater tickets found in the defendant’s wallet; and a receipt from a theater vendor which had the time and date stamp on it.  Of course these are three very powerful facts – often hard to dispute – which are more compelling than merely stating the conclusion that an alibi exists.

In two weeks, I will again be teaching second year students trial advocacy at Emory Law School.  It is hard to explain the difference between facts and conclusions but I give them this example which, in past years, they seem to remember.

Several years ago, a seven year old girl who is the daughter of a trial lawyer, said to her father: “I hate my little brother, no one likes him, he is extremely difficult and we need to trade him in for a new brother.”  The father said, “Sweetie, haven’t I told you to make your arguments with facts and not conclusions or hyperbole?”  The daughter said, “Yes, I remember Daddy; I will start over. Here is a photo of your BMW and the can of spray paint used to redecorate it.  Here is a photo of our dog Spot tied up in your Versace Neck Ties and I have here a photo of your 80 inch Samsung TV set and the baseball that went through the screen; I also have here an essay the little fellow wrote for school which discusses his contemporary art projects. Finally, Daddy, here is a study by a prominent Harvard Psychologist who says that parents do well to act early and trade in ill-behaved children.” The father responded: “I understand.  Say no more.  The little fellow is history.”

Advocacy is a two way street

Young lawyers learning about advocacy need to understand how judges think if they are to master the skill, says Reuben Guttman.

Young advocates or trial lawyers often labour under the conception that communication is a one size fits all effort.  Be smooth, don’t be nervous, be flamboyant, and engage in fanfare.  Really?  For my trial advocacy students at Emory Law School, this is sometimes their vision of a trial lawyer.  Yet advocacy is a two way street.  Before an advocate formulates the content and form of his or her message, the most important question to ask is “Who is receiving the message?” Advocates, or trial lawyers, are teachers.  Judges and juries are their students.  How does the trial lawyer, as a teacher, deliver a message that resonates with each particular student?

Insight

Last year at Emory Law School,  I convened a panel of four judges with the hope of giving students an insight into their lives.  It was enlightening for the students to learn that these judges had dockets ranging from a couple hundred to several thousand cases.  The students learned that these judges were tasked with deciding matters that they had never studied in law school.  Their support ranged from one to several law clerks and the law clerks themselves were all recent law school graduates.  This group of judges ranged from civil cases to criminal matters with divorces, large scale securities class actions, business disputes, discrimination cases, and maritime matters in the mix.

Breaking the monotony

There is a saying that justice is blind.  And of course there is a perception that judges are powerful – which they of course are – and that they know everything.  While sitting in federal court a couple of weeks ago, I was watching a judge hear a dozen motions before it was my turn to argue. He was jovial.  He was witty. He engaged the litigants with humour.  I liked him. I had seen this behavior before with jurists.  I realised of course that some judges usually do this to break the monotony of the job.  They are human beings.  As I sat and watched this particular judge, I thought about him sitting high on his bench in a courtroom with 35 foot ceilings and the walls adorned with paintings of judges who had preceded him. I thought about why the US government spends so much on these ornate courtrooms.  I realised that without these accoutrements, judges would seem like mere mortals.  And of course, the proceeding itself would not be cloaked in the same solemnity.

Lifetime experiences

For the advocate, it is important to understand that at the end of the day, their messages will be evaluated by humans; whether they are judges or jurists.  They will have lifetime experiences, families that they go home to, perhaps pets that they feed, and like other humans, they will have had their successes and failures.  They will have fears and concerns.

If there is a takeaway from all of this, it is that advocacy is a two way street.  What you may think is the right message, or form of message to deliver to the decision maker, may not necessarily be the one that resonates.  What you may think is the right style may not be appropriate for a particular audience.  This is just something to think about; communication is a two way street.

Tort Reform: A Lion in Sheep’s Clothing

Tort reformers cite a range of cases as frivolous litigation. But, says Reuben Guttman, many of these lawsuits raise fundamental issues.

The United States Chamber of Commerce, a few academics and some media pundits have their lists of cases arguably supporting the proposition that people will sue over anything and hence the need for tort reform to prevent so called ‘frivolous litigation.’  Out of the countless number of cases filed each year in United States federal and state courts, the tort reformers love to harp on the suit brought by the woman against McDonalds for serving hot coffee and the class action now pending against Subway for allegedly misrepresenting the size of its advertised foot-long sandwiches.

Golden oldies

Since the tort reformers seem to keep dwelling on the same few cases, it might be worth mentioning a few oldies but goodies which have eluded their attention. First, there is the “classroom kick case” where an elementary school child was sued for kicking another student on the knee.  This heinous event occurred in a classroom. The court allowed the case to go forward, holding that if the offending kicker had made his offensive contact on the playground, the kick might have been permissible.

Then there is the “falling scale case” involving a man on a railroad platform; running to jump on a train, he was pulled on board by a conductor.  Struggling to board the moving rail car, the man dropped a package containing fireworks; the fireworks exploded, knocking a scale down at the end of the platform.  The scale fell on another man who sued the railroad!

Finally, there is the case brought by parents who allowed their child to play on railroad tracks.  The child wandered onto a railyard and was injured by a turntable used to reposition rail cars.  The parents sued the railroad!

These are real cases; Vosberg v. Putney, 80 Wis. 523 (Wisc. 1891), Palsgraf v. Long Island Railroad, 248 N.Y. 339 (N.Y. 1928) and Sioux City & Pacific Railroad Co. v. Stout, 84 U.S. 657 (1873).  The thing is that they are not new.  I found them in a casebook on torts belonging to my dad.  While the casebook was published in 1934, I too had studied them in law school.  Back in law school, I actually read a lot of cases that made me wonder why courts spend so much time on matters that are small or that by some lights should not exist at all. Yet from seemingly small cases, judges have for years extrapolated important legal doctrine. The holding and dissent in Palsgraf, written by Justices Cardozo and Andrews respectively, are well studied and cited works. These writings are at the heart of the common law of negligence.  The doctrine of “attractive nuisance,” or at least variations of it, flow from Stout and similar cases.

It is cases like Vosberg, Palsgraf and Stout —  actually landmark decisions studied for decades by laws students —  that today’s tort reformers might cite in support of their claim that frivolous litigation clogs the courts and burdens business. Yet it is these matters – cases with simple sets of facts – that allow judges to articulate important rules that can be applied to weightier cases.

The lion and the zoo

In his closing argument to the jury in Silkwood v. Kerr McGee, 464 U.S. 238 (1984), lawyer Gerry Spence talks about the case in “Old England” where the lion escaped from the zoo and the zoo was responsible for the damage caused by the lion even if it exercised due care in caging the animal.  Of course the Silkwoodcase involved the escape of plutonium from a Kerr McGee plant.  From the simple case of the lion, Spence explains the law of strict liability, telling the jury “if the lion got away, Kerr McGee must pay.”

The truth is that the common law is replete with small cases; some that others would never bring; some that tort reformers might argue are completely frivolous and some that appear at the time to be small yet provide critical insight into the application of the rule of law and the expectation for compliance.  And so do we really want to be in the business of telling that family whose kid was kicked in the knee that there is no place for that suit in a court of law?

Now, about the cases involving coffee and that other one about the foot-long Subway sandwich?  Well, it turns out that the woman who brought suit against McDonald’s sustained serious burns when a scalding cup of coffee, purchased at a drive-in, spilled on her lap.  And, while the tort reformers may consider her case frivolous, have you ever noticed that most coffee shops now check the temperature of their coffee before serving it?

Fundamental issues

I reached out to the lawyer who is bringing that foot-long Subway sandwich case.  He asked me what the difference was between a fast food enterprise serving a smaller quantity than advertised and a bank charging each depositor a few extra cents in interest each month?   Small damages for each consumer?  Perhaps.  Large damages across the board for a class?  Undoubtedly.  But does the case raise fundamental and perhaps important issues about truth in advertising which may create precedent for more weighty matters?  Absolutely.  And this is what our common law tradition is all about.

For more insight into the Tort Reform movement, I recommend this video, Debate on Tort Reform After Viewing of Documentary ‘Hot Coffee’

“Hot Coffee” is an HBO documentary about the Tort Reform Movement and who is really behind it.  More information and the trailer is available here.

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