Lawsuits piling up against New England Compounding over meningitis deaths

October 21, 2012

As the number of people sickened with meningitis after receiving contaminated steroid injections continues to rise, lawsuits are starting to pile up.

At least 12 people have filed separate complaints in federal and state courts seeking damages from the compounding pharmacy that produced the steroids, New England Compounding Center of Framingham, Mass.

Attorneys for many of the more than 280 afflicted patients — 23 of whom have died — predict that the number of suits will multiply exponentially in the coming weeks. And several of the plaintiffs are among the roughly 14,000 people who received injections from the implicated lots but who have not actually been diagnosed with meningitis, suggesting the ultimate tally of lawsuits could run in the thousands.

The race to sign up clients is palpable, even in states where the outbreak has been relatively contained. In Minnesota, where seven people have been officially linked to the outbreak since the first cases were detected last month, a recent edition of the Minneapolis Star Tribune featured prominent advertisements by two law firms. And a Google search of the term “fungal meningitis” brings up a blizzard of paid ads from attorneys across the country urging the reader to “Protect Your Loved One’s Rights!” and “Contact Us Immediately.”

Alyson Oliver, an attorney whose Rochester, Mich.-based firm bought its first Google ad last Monday, said she was motivated to do so after agreeing to file suit in U.S. District Court on behalf of Brenda Bansale, a 46-year-old homemaker who was hospitalized to treat severe headaches shortly after receiving a shot from one of the potentially contaminated lots.

“We’re already going to be deeply involved in investing resources and time to help Mrs. Bansale,” Oliver said. “So, to the extent that we can take that knowledge and put it to use for other people involved, that would be beneficial.”

Several plaintiffs attorneys said their hand could be strengthened if federal authorities successfully pursue criminal charges against New England Compounding.

Federal Drug Administration criminal investigators searched the company’s offices Tuesday. In a statement issued that day, U.S. Attorney Carmen A. Ortiz confirmed that her staff and other law enforcement agencies are investigating allegations concerning the company. However, she said it was “entirely premature” to predict the results.

A spokesman for New England Compounding, Andrew Paven, declined to discuss the company’s legal situation.

“While the company is cooperating with both federal and state authorities to determine the cause of contamination, and at the same time professionally and efficiently manage the recalls that have been initiated, we will refrain from commenting on legal issues both existing and hypothetical,” Paven wrote in an e-mail Friday.

Among the challenges for plaintiffs is the considerable variation among state laws likely to apply. So far, the outbreak has spanned 16 states, including some with strict limits on product liability claims.

For instance, in Tennessee, whose 69 cases and nine fatalities are the highest of any state, patients have only one year to file against an involved party, said Fred Pritzker, a Minneapolis-based attorney who is counseling about 40 clients from various states. By contrast, in Minnesota, where Pritzker has filed suit in federal district court on behalf of a 41-year-old woman, the statute of limitations is four years for product liability suits and six years for those claiming negligence.

Tennessee lawmakers also recently capped economic or punitive damages in such suits at $500,000, and damages for pain and emotional suffering at $750,000, Pritzker said. Minnesota has no caps.

“The range of laws and the effect on cases is huge,” he said. “It’s a free-for-all, frankly.”

State laws might not govern damages if the plaintiffs consolidate their claims into a class action.

But attorneys said the more likely approach will be to seek multidistrict litigation status. In that scenario, one judge would oversee the discovery process. But unless the case is resolved through settlement, the outcomes of individual suits would need to be litigated in the plaintiff’s home state in accordance with relevant state law.

Will Moody, who is representing a Salem, Va., man, has chosen to file in Roanoke Circuit Court. Moody didn’t want to risk having the case transferred to a federal court “far away from here,” he said. Virginia’s court system “moves cases along expeditiously and the juries have been very fair,” he added.

Many attorneys warn that even if their clients are able to win favorable judgments or settlements, New England Compounding is unlikely to have enough funds — or enough liability insurance — to adequately compensate them.

“There are no guarantees on any of this,” said Jeffrey Montpetit, the attorney who has filed the other Minnesota federal court case.

If New England Compounding declares bankruptcy, it could further complicate the deadlines for patients seeking legal redress.

Such possibilities will almost certainly prompt a scramble to identify other sources of compensation. Attorneys said they hope to “pierce the corporate veil” around New England Compounding to determine the financial liability of affiliated companies.

And they said they would examine the possible culpability of “upstream” parties such as suppliers of the ingredients and “downstream” entities such as the clinics and doctors that bought and administered the injections. Already the plaintiff in at least one suit, filed in Virginia state court, has named the clinic that gave her the shot in addition to New England Compounding, according to news reports.

But, again, there are hurdles. Doctors can’t generally be sued for product liability. Instead, patients must pursue a medical malpractice claim, said Christopher Chestnut, an attorney who has filed in Florida state court on behalf of a man who lives there. And in contrast to product liability claims — which merely require plaintiffs to demonstrate that a product was defective and caused them harm — medical malpractice suits require proof that the harm resulted because the provider breached a standard of care.

“It’s subjective versus objective,” Chesnut said.

Still, he said, he could envision at least one avenue to pursue: Compounding pharmacies are generally supposed to fill only individual prescriptions and are prohibited from producing drugs in bulk, he said. So if a doctor or clinic can be shown to have knowingly purchased the injections in large batches, that could constitute proof of negligence, for which the doctor or clinic is liable.

“By buying in bulk, they sacrificed the safety of their patients for profits,” he said. “It’s unfathomable.”

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