Richmond Virginia Personal Injury Lawyer

$ in Politics

Michael Phelan — Wed, 15 May 2013 12:04:34 GMT

The folks at Roll Call published on April 23 a list of the top 25 organizations that are spending money on federal lobbying during the first quarter of 2013. Not one group on this list is advocating on behalf of individual citizens or for preservation of the right to trial by jury under the Seventh Amendment. Here is the list.

Chamber of Commerce of the U.S.A. $10,140,000 — down from $29,510,000 in the last quarter of 2012

National Association of Realtors $8,500,000 — down from $15,440,000

U.S. Chamber Institute for Legal Reform $6,430,000 — down from $10,910,000 (1)

Northrop Grumman Corporation $5,820,000 — up from 4,510,000

Pharmaceutical Research and Manufacturers $5,270,000 — up from $4,120,000

General Electric Company $5,190,000 — up from $4,940,000

American Medical Association $4,910,000 — up from $3,400,000

Exxon Mobil Corporation $4,840,000 — up from $3,100,000

United Technologies Corporation $4,630,000 — up from $3,889,000

Comcast Corporation $4,480,000 — up from $2,330,000 (more)

AT&T Services Inc. $4,260,000 — up from $3,400,000

National Association of Broadcasters $4,200,000 — up from $3,290,000

Merck & Company $4,190,000 — up from $1,190,000

National Cable and Telecommunications Association $4,170,000 — down from 5,880,000

American Hospital Association $3,810,000 — down from $5,350,000

Southern Company $3,760,000 — down from $5,070,000

Lockheed Martin Corporation $3,710,000 — up from $3,600,000

Verizon Communications $3,670,000 — up from $3,480,000

Chevron USA INc. $3,660,000 — up from 2,470,000

Boeing Company $3,580,000 — same as last quarter

Google Inc. $3,350,000 — same as last quarter

CVS Caremark Inc. $3,338,680 — up from $2,930,000

Novartis $3,290,000 — up from $1,212,000

General Motors Company $3,220,000 — up from $1,480,000

Edison Electric Institute $3,160,000 — up from $3,410,000

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(1) Note: Along with the Chamber of Commerce of the U.S.A., which bears very little resemblance to local Chambers, this group actively advocates to weaken the civil justice system for consumers, while preserving it for big business.

Originally posted at The Legal Examiner by Michael Phelan

"Pension Advances" Threaten Retiree Savings

Mark Krudys — Sun, 28 Apr 2013 21:14:38 GMT

Retirees are being solicited by certain companies to obtain “pension advances,” which regulators say are really disguised loans. The New York Times has determined that pension advances carry (after factoring in fees) interests rates ranging from 27 percent to 106 percent. Jessica Silver-Greenberg, “Loans Borrowed Against Pensions Squeeze Retirees,” New York Times, Apr. 28, 2013, p. A1.

Ads for the pension advances tout to military retirees and others: “Convert your pension into CASH”; “You have put your life on the line for Americans to protect your way of life. You deserve to do something important for yourself.”

According to the New York Times, legal aid offices in Arizona, California, and New York have reported a surge in complaints from retirees about the products.

The New York Times reports:

Pitches to military members must sidestep a federal law that prevents veterans from automatically turning over pension payments to third parties. Pension-advance firms encourage veterans to establish separate bank accounts controlled by the firms where pension payments are deposited first and then sent to the lenders. Lawyers for retirees have challenged the pension-advance firms in courts across the United States, claiming that they illegally seize military members’ pensions and violate state limits on interest rates.

To circumvent state usury laws that cap loan rates, some pension advance firms insist their products are advances, not loans, according to the firms’ Web sites and federal and state lawsuits. On its Web site, Pension Funding asks, “Is this a loan against my pension?” The answer, it says, is no. “It is an advance, not a loan,” the site says.

The advance firms have evolved from a range of different lenders; some made loans against class-action settlements, while others were subprime lenders that made installment and other short-term loans.

P. A4.

One former Marine, Ronald Govan of Snelville, Georgia, states, “I served this country and this is what I get.” The N.Y. Times reported that Govan paid an interest rate of more than 36% on a pension-based loan.

Originally posted at The Legal Examiner by Mark Krudys

Is a Kickback the Reason Your Pharmacist or Physician Recommended That New Drug?

Michael Phelan — Sun, 28 Apr 2013 12:21:45 GMT

Two federal lawsuits charge Novartis Pharmaceuticals with making fraudulent kickbacks to promote sales of its drug, Myofortic.

Less than three years ago, Novartis settled criminal and civil investigations into whether it had illegally promoted drugs to health care professionals for uses not approved by the Food and Drug Administration. The company was accused of providing illegal kickbacks to doctors through such mechanisms as entertainment, travel, and appointment to advisory boards or speaker programs. It paid $422.5 million to settle the case and signed a “corporate integrity agreement” to ensure that its promotional functions would comply with a federal anti-kickback statute.

Last week, the United States attorney for the Southern District of New York, filed a lawsuit accusing the company of providing kickbacks to pharmacies to generate sales of Myofortic. The suit charged that Novartis provided illegal rebates and discounts to 20 or more influential pharmacies based on their success in persuading institutions and doctors to switch patients from other drugs to Myfortic, an immune suppressant used to prevent rejection of kidney transplants. As the NYT points out, one wonders why the U.S. attorney is not also pursuing the corrupt pharmacies, which are suspected of pocketing tens or hundreds of thousands of dollars in illegal kickbacks.

The federal prosecutors also filed a second suit, charging that Novartis Pharmaceuticals made illegal payments to physicians in the form of honorariums and other benefits to induce them to write prescriptions for various other drugs made by the company. These sound like exactly the kinds of payments that Novartis pledged not to make in the settlement three years ago.

The system is broken-not only because patients at risk of being talked by healthcare providers on the take into switching to a drug that may not be best for them, but also because this type of kickback scheme hurts competition in a free market. It is not different than when Congress favors one company over another. Cronyism is the enemy of capitalism.

The Novartis case illustrates a much wider problem in the pharmaceutical industry. Public Citizen, an advocacy group for consumers, has tabulated the court judgments against pharmaceutical manufacturers and the major financial settlements between them and federal and state governments over the past two decades. Last year GlaxoSmithKline paid the largest health fraud settlement ever, a hefty $3 billion, and two other companies paid $1.5 billion or more.

It is clear that the mega-drug companies have factored huge fines into the cost of doing business. The fraud continues, because the current system is fines is not working. Stronger remedies against the companies could be the answer. Part of the answer should include prosecution of those accepting the illegal kickbacks. Those folks cannot afford to factor into their business plans the cost of paying huge civil penalties. The real stick would be to make pharmacists and doctors too scared to accept the drug company bribes.

Originally posted at The Legal Examiner by Michael Phelan

Large Estate May Pass to New York State

Mark Krudys — Sun, 28 Apr 2013 11:33:20 GMT

“He was a very smart man but he died like an idiot,” is the frank and harsh assessment made by Paul Skurka concerning his friend and fellow Holocaust survivor, Roman Blum, who died last year at the age of 97 without a will. Blum had no known heirs and no surviving members. Blum’s estate is valued at almost $40 million. It is the largest unclaimed estate in New York State history, according to the state comptroller’s office. The public administrator handling the case has hired a genealogist to search for relatives. If none are identified, the money will pass to New York State.

Mason D. Corn, his accountant and friend for 30 years told the New York Times, “I spoke to Roman many times before he passed away, and he knew what to do, how to name beneficiaries.” Julie Satow, “He Left a Fortune, To No One, N.Y. Times, Apr. 28, 2013, MB. P. 1. “Two weeks before he died, I had finally gotten him to sit down. He saw the end was coming. He was becoming mentally feeble. We agreed. I had to go away, and so he told me, ‘O.K., when you come back I will do it.’ But by then it was too late. We came this close, but we missed the boat.”

According to the N.Y. Times, Blum’s funeral was attended by a small number of mourners, most of them elderly fellow survivors or children of survivors.

In her article, Satow provides an interesting description of Mr. Blum’s early years in the U.S.:

In 1949, the Blums came to New York and settled in Forest Hills, in Queens. There, they joined a tightknit community of survivors, many of whom they knew from the Zeilsheim camp.

“They all lived the same type of lifestyle, going to the bungalow colonies together, the Catskills, everything was done as a group,” said Jack Shnay, a child of survivors who grew up in Forest Hills with the Blums. “Initially, they all lived in apartments in Rego Park; then they starting buying or building private homes.”

“Every weekend was a party,” said Charles Goldgrub, the child of survivors and Mr. Blum’s godson, who also grew up in Queens. “They had survived Hitler so they thought they would live forever.”

On weekends, the survivors would often gather to play high-stakes poker and drink plum brandy. They rarely discussed their wartime experiences, but sometimes, as a group and tipsy, they would grow emotional. Mr. Blum’s favorite tune was the 1968 single by Mary Hopkin, “Those Were The Days,” recalled Michael Pomeranc, a hotelier who grew up in Forest Hills and whose parents, also survivors, were close to the Blums. “He was always singing that song, and especially if he’d had a bit to drink, he’d try to get everyone to join in with the lyrics,” Mr. Pomeranc said.

Blum’s circumstances indicate that, given the opportunity, he could have identified charities that he found to be doing meaningful work. Many people who don’t have a will, don’t because they simply have never gotten around to addressing the matter. Local business professionals can generally identify competent estate planning lawyers. Modifications to wills may be made through “codicils.” Waiting to devise a plan for the distribution of assets may result in no plan at all.

Originally posted at The Legal Examiner by Mark Krudys

Standard & Poor’s Defense: “We Weren’t Really Serious”

Mark Krudys — Tue, 23 Apr 2013 11:53:23 GMT

In response to a DOJ civil lawsuit that the company committed fraud when it asserted that its ratings were independent and objective, Standard and Poor’s (S&P) Rating Services has claimed that the assertions were mere “puffery.”

Whether or not the argument is legally viable, the Wall Street Journal notes that the position degrades the reputation of the firm. See Jeanette Neumann, “S&P Has Unusual Defense,” Wall St. J., Apr. 22, 2013, p. C1. In the Wall Street Journal article, Samuel Buell, a law professor at Duke University, questioned what the point of a rating agency is if the firm contends that its ratings are “puffery.”

Forms of mere “puffery” generally include comments by businesses that they are “the best in town,” and have “the lowest prices.” Judges have long regarded these types of assertions as a form of permitted boasting by businesses and upon which a fraud claim cannot be made. However, if the ratings agencies contend that their ratings should be regarded as mere “puffery,” then, as Prof. Buell notes, one has to wonder why rating agencies even exist? S&P seems to be carrying out a legal Houdini act – claiming in court that their representations are not to be depended upon, but on Wall Street that their comments are credible and important. We will see if the street remembers the rating agency’s courtroom assertions.

Originally posted at The Legal Examiner by Mark Krudys

Should Hospitals Suspect "Sterile Solutions" Whenever There is an Outbreak?

Michael Phelan — Tue, 23 Apr 2013 10:36:53 GMT

Gram-negative bacteria can cause disease and many types of infections. It is the type of contaminant that hospitals work hard to keep out of sterile environments like operating rooms. Over the last several years, there have been too many reports of compounding pharmacies- manufacturers of custom mixed medications- shipping tainted product to hospitals.

Several years ago, a compounding pharmacy named Central Admixture Pharmacy Services (CAPS) shipped from its Maryland facility bacteria- tainted cardioplegia to a hospital in Fredericksburg, Virginia. The product was used in open heart surgeries. The result was a slew of patients with systemic inflammatory response syndrome, which caused death and severe illnesses. CAPS is currently under investigation at its Massachusetts facitlity by the FDA. More recently, New England Compounding Center allegedly shipped tainted steroid shots, which resulted in last year's fungal meningitis outbreak.

Compounding pharmacies make high-risk-sterile products. The manufacturing process requires strict adherence to sterility standards and protocols. The problem in each instance of tainted product has been poor practices and conditions which exposed the sterile products to microbial contamination.

Since February, the FDA inspected 30 compounding pharmacies, finding dozens of safety violations. Several compounding pharmacies issued recallsin the past several weeks. On April 21, the WaPo reported that a Florida-based compounding pharmacy, Balanced Solutions, is voluntarily recalling all of its lots of sterile non-expired drug products sold nationwide due to concerns that the products may contain bacteria. That means hospitals all over the country may have these products. Hosptitals are advised to immediately check their supplies, quarantine the products, and follow the recall instructions. Hospitals further need to advise patients who were already administered any sterile-drug products made by Balanced Solutions to contact a physician. According to the WaPo article:

An FDA inspection of Balanced Solutions found “poor practices and conditions which may have exposed the company’s sterile products to microbial contamination,” the agency said in a statement. Inspectors discovered “black particles of unknown origin” in seven vials of an injectable steroid, according to their report. They also found “a cloth-like filament of unknown origin” in one vial of chromium-chloride injections, an additive used for intravenous nutritional supplements.

The FDA subsequently identified the contamination as gram-negative bacteria. Hospitals should cast a critical eye at the suppliers of their sterile-drug products whenever an unexpected outbreak of disease or illness linked to microbial contamination occurs. We must stop resigning ourselves to the notion that these problems cannot be prevented.

Originally posted at The Legal Examiner by Michael Phelan

Securities Brokers to Disclose Financial Incentives for Switching Firms

Michael Phelan — Tue, 16 Apr 2013 11:53:18 GMT

For years, brokers with sizeable books of business (large and well-funded client bases) often moved between firms in order to receive robust up-front bonuses. The bonuses often measure between $750,000 and $1 million. The bonuses are generally paid to brokers in the form of “forgivable loans” – for each year that the broker is employed by the new firm a portion of the bonus is forgiven (the entire amount is generally extinguished after five years). Clients are generally told that the broker’s move was spurred by a desire to improve client account services or to obtain better research. Until now the clients have never been told the truth behind the move, or for that matter, been informed at all regarding their bottom-line value to the broker. That may be changing. On April 15, 2013, the Wall Street Journal reported that securities regulators are widely expected to start forcing stockbrokers to disclose to clients when they receive big dollars in connectio with a move to a new firm. The disclosure may cause clients to be more circumspect about moves that are touted as being made for the client’s benefit. My own experience in handling securities matters is that at least 90% of clients follow departing brokers to their new firms. Perhaps now, clients will begin to question the logic of such. Also, the circumstances may spur a discussion between the client and broker about the fees and costs being paid by the client. A large client who is informed that the broker is being paid handsomely simply because the client has hitched his wheel to the broker may extract greater price concessions for following the broker to the new firm, or conversely, with the current firm for staying put.

Author: Mark Krudys, a former SEC Enforcement Division attorney and securities federal prosecutor who regularly represents clients in disputes with brokerage firms.

Originally posted at The Legal Examiner by Michael Phelan

BRAIN Initiative

Michael Phelan — Wed, 03 Apr 2013 10:18:29 GMT

President Obama proposed $100 million in federal funding toward the Brain Research through Advancing Neurotechnologies Initiative ("BRAIN Initiative"). The President likened the BRAIN Initiative to the Human Genome Project, the Apollo space project, and the internet, stating, "[i]magine if we could reverse traumatic brain injury and PTSD for our wounded veterans...."

The President intends to send this proposal to Congress next week as part of his budget. Surprisingly, House Majority Leader Eric Cantor spoke out in favor of the proposal.

“Mapping the human brain is exactly the type of research we should be funding, by reprioritizing the $250 million we currently spend on political and social science research into expanded medical research, including the expedited mapping of the human brain. It's great science,” Cantor said in a statement.

I am surprised by Cantor's support for this type of federal spending because this appears to be inconsistent with his focus on cutting the federal defecit. How will we pay for this initiative? Will we borrow the money from China? There is no doubt that this research may lead to amazing discoveries that benefit mankind. I'm just perplexed by the politics of a $100 million project that we cannot afford.

In fairness to supporters of the project, it is a private-public initiative, with funding from the Howard Hughes Medical Institute, the Paul Allen brain mapping project, and other private entities. The $100 million in federal funds will come from the National Institutes of Health, the Defense Advanced Research Projects Agency, and the National Science Foundation.

Originally posted at The Legal Examiner by Michael Phelan

First DePuy Hip Implant Verdict May Be Tip of Iceberg

Michael Phelan — Fri, 08 Mar 2013 16:04:58 GMT

After hearing the first product liability case to go to trial in this country against DePuy Orthopaedics and its parent company, Johnson & Johnson over the DePuy ASR hip implant and deliberating for seven days, a Los Angeles jury today rendered its verdict. The jury found that the DePuy ASR XL hip implant was defective and that it caused the plaintiff's injuries. The jury awarded the plaintiff $8.3 million in compensatory damages.

The case is Kransky v. DePuy, BC456086, California Superior Court, Los Angeles County (Los Angeles), which began January 25, 2013 and ended on March 1. A second product liability trial against DePuy and J&J regarding the DePuy ASR hip implant begins next week in Chicago.

At the Kransky trial, J&J's lawyers highlighted Mr. Kransky's other health problems. Mr. Kransky was 65 years of age. His “diabetes, cancer, kidney disease, heart disease, vascular disease and his many other health problems are unrelated” to his hip, J&J’s attorney Michael Zellers said in his closing argument. J&J lawyers said he was a vasculopath, which means he has diseased blood vessels throughout his body. In spite of these facts, the jury awarded Mr. Kransky $8 million for his pain and suffering.

The closing argument about Mr. Kransky's health was made in part to attempt to diminish the value of his case. This strategy will not be available to J&J in all future cases. Indeed, many otherwise healthy people have had to have their defective DePuy hip implants removed. Not all hip implant patients are elderly and in poor health. Some young people received DePuy ASR hip implants after a trauma, like a sports injury, because the device was marketed as being able to last up to 30 years. This is important to a young hip implant recipient, because each successive hip replacement surgery causes damage to the bones and puts at risk the function of the patient's hip joint. Thus, an implant marketed to last 30 rather than 15 years was very attractive to young patients and their surgeons.

How will a jury treat these patients?

Originally posted at The Legal Examiner by Michael Phelan

Will Patients Harmed by Generic Drugs Have any Remedy?

Michael Phelan — Tue, 05 Mar 2013 15:12:13 GMT

The vast majority of consumers probably do not realize that if they are injured by a generic drug versus a brand-name drug, they may have no meaningful recourse. A brand-name drug manufacturer is not legally responsible for injuries caused by a generic copy cat drug. One would reasonably expect that the responsibility for harm caused by a defective generic drug would lie with the manufacturer that decided to make, sell, and profit from a knock-off drug patterned after a brand-name equivalent. One would be wrong.

In Pliva, Inc. v. Mensing, decided by the Supreme Court of the United States on June 11, 2011, one of the issues was whether the generic drug manufacturer could be sued under Minnesota and Louisiana state tort laws that required a manufacturer that is, or should be, aware of its drug's danger to label it in a way that renders it reasonably safe. In a decision authored by Justice Thomas, the Court found that the only duty of a generic manufacturer is to ensure that its warning label is the same as the warning label of the equivalent brand-name drug that has already been approved by the FDA. The crux of the Pliva decision is that suing a generic manufacturer for negligent failure to warn is a sure ticket to having your case dismissed based on federal pre-emption.

The next issue being taken up by the Supreme Court is whether a patient injured by a generic drug can sue on the theory that the drug itself was defective. The case is Bartlett v. Mutual Pharmaceutical Company, and the Court will hear arguments on this case this month. In Bartlett, the patient took a generic NSAID and developed Stevens -Johson Syndrome. The drug caused a severe skin reaction resulting in two-thirds of her skin falling off, severe burns, permanently damaged lungs and esophagus, and blindness. The issue to be decided in Bartlett is significant because generic drugs now account for 80 percent of all prescriptions in the United States. Moreover, it is typically the patient's insurance company or entitlement program that mandates the use of generic drugs. Most patients have no choice.

Mutual Pharmaceutical will argue that the outcome of this generic drug design defect case should be the same as the outcome in the Pliva case since, like the warning label, the generic manufacturer has no control over the drug's design. The United States Court of Appeals for the First Cirucuit in Boston disagreed with Mutual's argument, reasoning that even if Mutual could not have changed the drug's design, it could have discontinued selling an unreasonably dangerous drug and taken it off the market. If the Supreme Court overturns the First Circuit's decision in Bartlett, consumers of generic drugs may be left with nothing more than a cause of action for manufacturing defect. In other words, they would have to prove that the manufacturer failed to follow the brand-name manufacturer's design, and that this failure was a proximate cause of the consumer's injuries.

Originally posted at The Legal Examiner by Michael Phelan