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HAZARDOUS TO OUR HEALTH
Trial Lawyers, Inc. hurts consumer health with its
full-fledged assault on the U.S. medical system.
Last November, hundreds of trial lawyers converged on Las Vegas
to plot a strategy for their assault on Merck Pharmaceuticals and its besieged
painkiller Vioxx.[14] They divvied up key tasks and traded
marketing and legal ploys in a confab worthy of a Fortune 500 company launching
a major new product.[15]
Meet the health-care division of Trial Lawyers, Inc., which regularly
delivers outsize profits for the plaintiffs’ bar at the expense of doctors,
hospitals, consumers, and the health-care system itself. Trial lawyers
have honed their health-care playbook to a simple but devastating formula
—gin up public outrage, recruit intimidating hordes of plaintiffs,
and rewrite medical science to fit the claims of injury.
Drug Torts: A Massive Pain
Trial Lawyers, Inc.’s highly effective business model has undone corporations
from Armstrong World Industries to W. R. Grace,[16] but
arguably nowhere have the litigation industry’s tactics been more aggressive
and sophisticated than in the mass product-liability suits that have dogged
pharmaceutical manufacturers for two decades. The plaintiffs’ bar and its
allies in consumer lobbies like Public Citizen have torpedoed dozens of drugs,
driving many off the market.[17] Of 39 pending product-liability
cases currently before the Judicial Panel on Multi-District Litigation, which
determines jurisdictional issues for mass torts, 22 involve drugs or medical
devices.[18] To be sure, some drugs have harmful side effects,
but they are often exaggerated and avoidable. Others, such as Norplant, a long-term
reversible contraceptive, have been hounded off the market despite evidence
that its side effects are little more than a nuisance.[19]
Bolstered by its success, and spurred on by the pharmaceutical industry’s
prolific development of useful and profitable new drugs, Trial Lawyers, Inc.
has been stepping up its assault. The litigation industry is using increasingly
sophisticated plaintiff-recruiting techniques, which include not only traditional
advertising—fully 46 percent of all trial-lawyer advertising on television
is directed at culling plaintiffs for drug lawsuits (see graph)[20]—but
also new tactics that vary from hitting daytime talk shows that attract the
poor and unemployed to running Internet ads that can reach more sophisticated
audiences.[21]
While the trial bar gets rich, the
average consumer loses—through
higher costs, reduced access, fewer
products, and less innovation. |
It’s no surprise that the plaintiffs recruited by such techniques usually
have feeble cases. Nor does it really matter. Trial Lawyers, Inc. needs
only to get a couple of multimillion-dollar verdicts—usually in tort-friendly
courts where judges are in the pocket of the plaintiffs’ bar—and it
can begin to make the real money from cowed defendants who settle the thousands
of weaker claims—often for billions of dollars.
Consider the Fen-Phen mass tort, for example: a Mayo Clinic study found that
the widely used diet drug appeared to cause heart-valve damage in 24 individuals,
which prompted the Food and Drug Administration to pull the drug from the market;[22]
soon after, Trial Lawyers, Inc. set up echocardiogram mills in hotels across
the country that churned out thousands of class-action claimants.[23]
An audit of a sample of plaintiffs’ echocardiograms found 70 percent ineligible
for compensation, many of them having been doctored to produce evidence of disease.[24]
Nevertheless, once Fen-Phen’s maker, Wyeth, lost two verdicts totaling
more than $120 million, it began to settle.[25] So far,
Wyeth has forked over $14 billion and estimates its total liability at $21 billion.[26]
Doctors Under Siege
Their deep pockets make drug companies sitting ducks for Trial Lawyers, Inc.,
but the litigation industry has also found less well-heeled
defendants, such as doctors, to be easy targets. The cost of these legal attacks
is increasingly unaffordable liability insurance for doctors: according to the
Congressional Budget Office, medical internists saw their malpractice premiums
climb 50 percent between 1993 and 2002, and 33 percent from 2000 to 2002 alone.[27]
Vulnerable medical specialties like obstetrics and neurology have buckled under
the ceaseless pressure from the trial bar. Skyrocketing malpractice-insurance
premiums— and, in some cases, the inability even to buy insurance—have driven
neurologists to refuse to staff emergency rooms and OB-GYNs to stop delivering
babies.[28]
Obstetricians continue to fall prey to suits alleging that the doctor's failure
to perform a Cesarean section caused oxygen deprivation during delivery, which
in turn caused cerebral palsy in the newborn. These suits, long a staple of
the malpractice bar, have grossed millions in fees for trial lawyers like former
senator and vice presidential candidate John Edwards.[29]
Notwithstanding the fact that research has shown that cerebral palsy is only
rarely attributable to birth asphyxiation[30]—and that
the dramatic increase in C-section rates has led to no decrease in the percentage
of infants born with cerebral palsy[31]—plaintiffs' attorneys
continue to flog this theory to gullible juries. Last year, one of the highest
jury awards ever in a medical malpractice case—$112 million (later settled for
$6 million based on a pre-verdict agreement)—went to a New York couple who claimed
that doctors failed to act on signs of fetal distress during the mother’s protracted
labor.[32]
The cost of such litigation industry tactics is lower-quality health care.
Trial Lawyers, Inc.'s cerebral palsy suits not only have helped spur an increase
in unnecessary C-sections, at a cost to mothers' health,[33]
but also have succeeded in shutting down maternity wards—Philadelphia has lost
three in recent years[34]—thus forcing pregnant women in
certain parts of the country to travel hours for treatment.
The Litigation Industry's New Health-Product Lines
Any well-run business must constantly explore new product lines, and the health-care
division of Trial Lawyers, Inc. is no exception. In recent years, the plaintiffs'
bar has been busily expanding its portfolio of health-care products. Having
successfully persuaded some judges to accept novel theories of elder abuse,
the trial bar has driven up the malpractice premiums of nursing homes.[35]
Hospitals have long been accustomed to malpractice suits over surgical mishaps
and birth defects, but now litigation-industry leaders like Dickie Scruggs,
who led the states’ suits against the tobacco companies, have made class-action
defendants out of nonprofit hospitals that serve the nation’s poorest citizens.[36]
Yet Scruggs's nonprofit hospital suits are small potatoes compared with his
ventures alleging, on behalf of 145 million patients, that health maintenance
organizations were guilty of fraud and racketeering.[37]
Copying a page from the playbook he used against Big Tobacco, Scruggs cozied
up to Wall Street analysts and investors, intimating what the fallout of an
adverse verdict might be.[38] Although the biggest cases
ultimately were dismissed, two insurers—after watching their stock prices tank—settled
for half a billion dollars each.[39]
Ultimately, while Scruggs and his buddies in the plaintiffs' bar get rich, the average health-care consumer loses—through higher costs, reduced
access, fewer products, and less innovation. Bloodletting was a core medical treatment from the time of Hippocrates to well into the last century,
but if today's leeches in the litigation industry are not constrained, they may suck the lifeblood out of the American health-care system.
<<previous section | next section>>
14. See David Hechler, First Vioxx Fight: Where to Litigate,
Nat’l L.J., Nov. 15, 2005, at 1 (discussing
“conference sponsored [in Las Vegas] by Mass Torts Made Perfect, for plaintiffs’
lawyers only, [which] featured five hours of Vioxx presentations on Nov. 11 and 12”).
15. Mass Torts Made Perfect “provides ambitious, goal-oriented attorneys
with the knowledge and methods that attract mass tort clients, take the case
into the courtroom and win over even the most formidable competition.”
See http://www.masstortsmadeperfect.com/html/aboutus.html.
16. See trIaL Lawyers, InC., supra note 1, at 10 (citing American
Association of Actuaries).
17. Public Citizen boasts that Vioxx was “the ninth drug removed from the
market in the previous seven years that we warned consumers not to use,”
see http://www.worstpills.org/moreaboutpc.cfm.
18. See http://www.jpml.uscourts.gov/Pending_MDLs/Products_Liability/products_liability.html.
19. Levonorgestrel, or Norplant, is no longer available in the United States;
see http://www.rxlist.com/cgi/generic2/norplant.htm.
For a discussion of the litigation industry’s attack on Norplant, see
Marc Arkin, Products Liability and the Threat to Contraception, 36 CIv.
Just. Memo (Manhattan Inst. Center for Legal Policy, Feb. 1999), available
at http://www.manhattan-institute.org/html/cjm_36.htm.
20. Data from TNS Media Intelligence (on file with Manhattan Institute).
21. For an example of a Trial Lawyers, Inc. website trolling for class-action
“customers,” see http://www.myclassactionlawsuit.com/.
For a discussion of how plaintiffs’ lawyer Mark Lanier exploited one juror’s
affinity for the Oprah Winfrey show in his closing argument in Ernst v. Merck,
see Heather Tesoriero et al., Merck Loss Jolts Drug Giant, Industry,
Wall St. J., Aug. 22, 2005, at A1.
22. See Heidi M. Connolly et al., Valvular Heart Disease Associated
with Fenfluramine-Phentermine, 337 new eng. J. Med. 581, 581-88 (1997);
Frankel, supra note 6.
23. See id.
24. See id.
25. See id.
26. See id.
27. See Congressional Budget Office, Limiting Tort Liability for Medical
Malpractice, Jan. 8, 2004, available at http://www.cbo.gov/showdoc.cfm?index=4968&sequence=0.
28. See Trial Lawyers, Inc., supra note 1, at 13.
29. See Marc Morano, Did “Junk Science” Make John Edwards
Rich?, Cnsnews.CoM, Jan. 20, 2004, at http://www.cnsnews.com//ViewPolitics.asp?Page=\Politics\archive\200401\POL20040120a.html.
30. A January 2003 report issued by the American College of Obstetricians and
Gynecologists and American Academy of Pediatrics found that “that use of
nonreassuring fetal heart rate patterns to predict subsequent cerebral palsy
had a 99% false-positive rate.” Neonatal Encephalopathy and Cerebral Palsy:
Defining the Pathogenesis and Pathophysiology (American College of Obstetricians
and Gynecologists and American Academy of Pediatrics Jan. 31, 2003), available
at http://www.acog.org/from_home/Misc/neonatalEncephalopathy.cfm
(executive summary).
31. See Steven L. Clark, Temporal and Demographic Trends in Cerebral
Palsy—Fact and Fiction, 188 Am. J. Obstetrics & Gynecology 628, 628-33 (Mar. 2003) (“The rate of
cerebral palsy has not decreased in developed countries over the past 30 years, despite the widespread
use of electronic fetal heart rate monitoring and a 5-fold increase in the cesarean delivery rate
over the same period of time.”).
32. See Nora L. Tooher, High-Low Agreement Deflates $111.7 Million
Award in Med-Mal Case, Lawyers Weekly USA Top Ten Jury Verdicts of 2004,
available at http://www.lawyersweeklyusa.com/usa/8topten2004.cfm
(discussing Reden v. Wagner Jan. 26, 2004).
33. See D. B. Petitti, Maternal Mortality and Morbidity in Cesarean
Section, 28 ClinicaL Obstetrics & Gynecology 763, 763-69 (Dec. 1985).
34. See Pennsylvania Medical Society Alliance, Closing Hospitals, available
at http://www.fightingdocs.com/closingHospitals.htm;
Joseph B. Treater, Rise in Insurance Forces Hospitals to Shutter Wards, n.y.
tIMes, Aug. 25, 2002; Steven Malanga, Tort Turns Toxic, CIty J., Autumn 2002,
available at http://www.city-journal.org.
35. See Theresa w. Bourdon & Sharon C. Dubin, Long Term Care: General
Liability and Professional Liability, 2004 aCtuarIaL anaLysIs (Aon Consulting,
July 2004).
36. See, e.g., Kolari v. N.Y. Presbyterian Hosp. et al., No. 04 Civ.
5506 (LAP), 2005 WL 710452, at *1(SDNY March 29, 2005).
37. See Susan Beck, HMO Postmortem, aM. Law., Oct. 10, 2003, available
at http://www.law.com.
38. See id.
39. See id.
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