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Michael Phelan
Michael Phelan
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Confusing Reports about J&J DePuy ASR Hip Settlement

9 comments

Last week it was reported widely that Johnson & Johnson had “tentatively agreed to a settlement” that could reach up to $4 billion to resolve thousands of lawsuites filed for patients injured by defective DePuy ASR hip implants.  DePuy Orthopaedics is a division of Johnson & Johnson.  Reports by the New York Times, Bloomberg, and others stated that under the proposed settlement, each patient would receive about $350,000 on average in compensation.

On November 15, 2013, the federal district court judge overseeing, MDL 2197, the DePuy ASR multi-district litigation, Hon. David A. Katz, entered an Order stating that “the Court will conduct an Open Court Conference on 11/19/2013 at 04:30 PM in Courtroom 204 before Judge David A. Katz at the James M. Ashley U.S. Courthouse in Toledo, Ohio.”  News leaked that the terms of the proposed settlement would be announced at this hearing.

After the hearing, the New York Times reported that Johnson & Johnson would pay “nearly $2.5 billion in compensation to an estimated 8,000 patients who have been forced to have the all-metal  artificial hip removed.”  The Times reported that the average payment per patient would be about $250,000 before legal fees.  I have spoken with a source who reports that the actual average compensation per patient will be higher than $250,000.  If the NYT’s estimate is in error, it may be because the earlier report of a $4 billion settlement with an estimated compensation amount of $350,000 per patient was based upon an assumption that about 12,000 claimants would be paid.

Under the hip implant settlement announced yesterday, reports indicate that about 4,000 of the 12,000 patients who filed lawsuits would not receive any compensation.  It is estimated that there are about 12,000 claims in the United States, and that about 8,000 of those claims involve patients who underwent operations to have the DePuy ASR device removed or explanted.

The proposed settlement will reportedly not go forward unless and until 94% of eligible claimants  opt-in to the settlment.  As with all opt-in settlements, claimants are free to decide to pursue their individual lawsuits in an attempt to recover more than they would recover under the settlement.  This settlement was negotiated by a relatively small number of attorneys appointed by the court to a plaintiffs steering committee.  Given the 94% opt-in requirement and the conflicting reports circulating about the amount and terms of the settlement, it would be a good idea for these attorneys to release a full explanation of the terms of the settlement asap.

Here are some questions that DePuy ASR claimants will need answered:

1.  What happens to patients who have been implanted with a DePuy ASR device but who have not had a revision surgery?  Under the reported terms of this settlement, such patients would receive no compensation unless they subsequently undergo a revision surgery?

2.  How long will patients who have not yet had revision surgery be eligible to have the surgery and participate in the compensation plan?

3.  What about patients who need revision surgery but cannot have it due to health issues (e.g., heart condition or damaged condition of their hip)?

4.  Are patients who have had revision surgery guaranteed a minimum compenstion of $250,000?  Reports indicate that the answer is “no.”  The average award of $250,000 is just that, an average.  The settlement plan would create two pots of money.  A $2 billion pot would cover basic awards.  The amount of the basic award could be higher or lower than $250,000 based upon a variety of factors.  Patients who smoke, are overweight, or are older may reportedly see their payments reduced.  The date the device was implanted will also affect the basic recovery.  The average payment to a patient who had the device for five to six years would fall to $225,000, and to $200,000 for patients who had the device for six to seven years.

The second pot of money is reportedly $475 million.  This pot will be to cover what have in past hip device settlements been called “extraordinary injuries.”  Patients who sustained more significant injuries related to the device, its removal, or its replacement will qualify to apply for additional payments.

5.  Will the settlement plan specify certain injuries that will qualify for the additional payments mentioned above?

6.  What was the source of the reported $4 billion settlement, and how did we get from $4 billion to $2.47 billion?

7.  Are there any benefits to patients in addition to the basic and possible additional compensation sums?  The answer is a definate “yes.”  According to reports, which I have confirmed, Johnson & Johnson will pay all medical costs and liens related to each patient’s device replacement.  This is a major benefit to the qualifying patients.  Most settlements require the patient to pay all medical balances and liens out of the settlement sum.  Moreover, in past mass tort settlements, disbursement of the net settlement amount to the client has been delayed for many months while health insurance and Medicare liens are negotiated.  Payouts under this proposed settlement will not be similarly delayed.

 

 

 

9 Comments

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  1. thomas says:
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    How about questions like, oh idk, how about lost wages, future lost wages, those of us that are still going through several rounds of pt? How about those of us that are still having great deals of pain? How about those that are having more effects from the cobalt poisoning? Many many medical conditions caused from the cobalt poisoning alone.. how about for the ones that are still young, and have had two complete hip replacements and are not even 50 yet? Because of the damage from chromium and cobalt poisoning in the hip joint and surrounding tissue, they are going to have to have more frequent hip replacements in the future.. what about those costs, and related expenses, which we all know are a bankruptcy waiting to happen? Many many factors need to be taken into consideration.. please think long and hard about your decisions.. and one last thing.. who in j n j is going to bethe ones admitting they knew about this the whole time? Greed.. that’s all this was for them.. who goes to jail for this?

  2. john dougherty says:
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    I had revision surgery on 10/28 which was 3 weeks before the announced settlement yet johnson & johnson set an arbitrary date of 8/31 as the cutoff for the revisions. What happens to those of us that fall between 8/31 & 11/19?. Also, what will happen to the medical bills I had as the result of yhe surgery?

  3. R Black says:
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    I would be surprised if J&J achieves a 94% opt- in to the settlement. This settlement reeks with back room dealing. Reflects Kransky 8.5 M in CA to Strum 0 in IL. Lawyers decided to get what they could and “move on”. To Hell with their clients and move on! That’s the way it works!

  4. Michael Phelan says:
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    R. Black: Thank you for your comments. I know of at least three law firms with large inventories of these cases who are advising their clients to reject the settlement. Mike Phelan

  5. John says:
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    Dear Mr. Phelan,
    What is the reduced payout for those that had revision surgery AND it was in their body past the 7 yrs cutoff ?
    Thank you

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      For detailed information about the terms of the settlement, go to http://www.USASRHipSettlement.com
      In general, the Part A-Base Awards will have the following ceilings based on length of implantation:

      More than 180 days but less than 5 years: $250,000
      Between 5 and 6 years: $225,000
      Between 6 and 7 years: $200,000
      Between 7 and 8 years: $150,000

  6. E. Kearns says:
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    I would be interested in finding out if there are any soundings coming out in relation to all the cases that occurred outside The United States.
    This settlement does not cover them, but it appears that if J&J are looking to settle cases, it is only a matter of time before they get around to dealing with this issue on a worldwide basis.
    What is worrying is that they have left out anyone that has not yet had corrective surgery. People do not want to go through all that if they can at all help it, but that should not mean that they are left out in the dark.
    This is surgery we are talking about, which is not risk free. If they were going to do this properly, the settlement proposal should cover everyone, not just those that had had to undergo surgery.

  7. John says:
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    Dear Mr. Phelan,

    What is the reduced payout for those that had revision surgery AND it was in their body past the eight (8) yrs cutoff ?

    Thank you