Agreement between Pa. Gov. and plaintiffs firm again challenged

John O'Brien Jan. 22, 2009, 5:00pm


PHILADELPHIA (Legal Newsline) - Janssen Pharmaceutica is asking the Pennsylvania Supreme Court to disqualify the firm hired by Gov. Ed Rendell to sue it.

The drugmaker submitted an Application for Extraordinary Relief with the Court Jan. 6, less than a month after a state judge denied its initial request to have Houston-based Bailey Perrin Bailey disqualified. BPB is representing Pennsylvania in a suit that alleges Janssen marketed off-label uses for its antipsychotic drug Risperdal.

Janssen feels BPB is steering the case, and a public office should never have a financial stake in the outcome of one of its suits. BPB was hired on a contingency fee basis.

"Moreover, in a significant deviation from previous contingent fee contracts executed by the Attorney General, the contract here does not include an express provision for 'control and management of the litigation,'" the application says.

"It instead contains a 'consultation' paragraph that merely obligates Bailey Perrin to 'consult with' the (Office of General Counsel) and to deal with the OGC as it would with any other client.

"There can be no doubt that the OGC has delegated at least a substantial part of the 'control and management' of this litigation to its outside contingent fee counsel."

Judge Howland Abramson of the Philadelphia County Court of Common Pleas denied Janssen's first motion to disqualify on Dec. 8. The order gave no explanation.

Bailey Perrin Bailey has made the same claim of marketing violations against Janssen, a subsidiary of Johnson & Johnson, in at least six other states, including Arkansas and Louisiana. State Medicaid programs, it is alleged, are harmed by Janssen's off-label marketing and failure to disclose side effects.

In its answer, BPB says Janssen has it all wrong. Final decision-making and ultimate control stays with Rendell's office.

"The contract relegates the Commonwealth's outside counsel, Bailey Perrin Bailey, to 'advis(ing), counsel(ing) and recommend(ing) actions to the OGC' and to 'carry(ing) out to the best of its ability (the OGC's) directions.'

"Further, Bailey Perrin Bailey is 'responsible directly to the General Counsel ... on all matters of strategy and tactics,' and must consult and cooperate with the OGC regarding the same."

BPB says it has assumed the risks of litigation and will have to stand behind any decisions made by Rendell's general counsel. Relinquishing control was a must.

"(N)othing in the contract restricts the OGC from negotiating any amount of monetary settlement with Janssen, or even abandoning the litigation altogether, a result which would result in no financial harm to the Commonwealth and no compensation to Bailey Perrin Bailey," the answer said.

Janssen's attorneys also attempted to make an issue of the campaign contributions given by BPB to Rendell. The application contains a timeline of BPB's involvement with Rendell's 2006 campaign.

The timeline is:

Feb. 23, 2006 - Mr. Bailey contributes airplane travel valued at $9,200 to Gov. Rendell's re-election campaign.

March 3, 2006 - Mr. Bailey contributes $50,000 to Gov. Rendell's re-election campaign.

May 12, 2006 - Gov. Rendell's Office of General Counsel sends the Pennsylvania Attorney General a "Request for Delegation" of authority

May 24, 2006 - The Attorney General grants the Request for Delegation

June 30, 2006 - Mr. Bailey contributes $25,000 to the Democratic Governors Association.

Aug. 14, 2006 - Mr. Bailey signs a contingent fee contract with the Commonwealth of pennsylvania, acting by and through the Governor's Office of General Counsel.

Sept. 15, 2006 - Mr. Bailey contributes airplane travel valued at $6,900 to Gov. Rendell's re-election campaign.

Sept. 19, 2006 - Effective date of contingent fee contract between the Commonwealth of Pennsylvania, acting by and through the Governor's Office of General Counsel, with Bailey Perrin.

Oct. 23, 2006 - Governor's General Counsel's Office mails the contingent fee contract to Mr. Bailey.

Oct. 30, 2006 - Mr. Bailey contributes another $25,000 to Gov. Rendell's re-election campaign.

Feb. 26, 2007 - Bailey Perrin files the initial complaint on behalf of the Commonwealth of Pennsylvania, c/o Office of General Counsel.

"The limited role of the OGC is apparent from the face of the Complaint, which was signed not by the Governor's General Counsel or anyone from her office but by lawyers from a private Philadelphia law firm serving as local counsel to Bailey Perrin," the application says.

Moreover, the Complaint was not verified by any Commonwealth officer or employee. The verification attached to the Complaint -- attesting that the signatory is 'in a better position than any individual officer or employee of the agencies of the Commonwealth Plaintiff to present this verification' -- was signed by Fletcher V. Trammell, Esquire, a Bailey Perrin lawyer."

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