PHILADELPHIA (Legal Newsline) - A long-simmering fight between the prominent plaintiffs’ law firm Hagens Berman Sobol Shapiro and several unhappy clients has escalated into open war as one of them sued her former lawyers for allegedly misleading her about the chances of winning a lawsuit based on decades-old claims of being exposed to the dangerous morning-sickness drug thalidomide.
Hagens Berman was ordered to pay $145,000 in sanctions in 2015 over its conduct in the thalidomide litigation after defendants including Glaxo SmithKline uncovered evidence plaintiffs had known for years before they sued that they might have been exposed to thalidomide and that at least one had already sued, and settled, claims over the drug. Thalidomide was withdrawn from the market in 1961 after massive worldwide publicity over its role in causing birth defects.
A federal judge sanctioned the firm for pursuing the litigation even though it should have known the statute of limitations doomed its clients’ claims. Hagens Berman ultimately dismissed many of the suits in what a special master described as a “suspicious” arrangement under which Glaxo dropped its request for sanctions.
Then in a further development, the law firm informed the court one of its lawyers had falsified a medical expert’s report to convince a client to drop her claims.
Now, Carolyn Sampson is suing Hagens Berman, accusing it of putting “the protection of its own financial, publicity, and reputational interests before those of the clients they recruited into a lawsuit without a fair disclosure of their chances of success.” The lawsuit filed in federal court in Pennsylvania earlier this month doesn’t formally allege legal malpractice, instead accusing the law firm of violating its fiduciary duty to Sampson and inflicting emotional and financial distress upon her.
Samson’s lawyer, Nicholas Boebel, didn’t respond to requests for comment, and neither did Hagens Berman. Name partner Steve Berman was a lead attorney in the tobacco litigation that led to a $260 billion global settlement in 1998 and included some $14 billion in legal fees for Hagens Berman and other law firms.
Sampson’s lawsuit adds another layer to an already complicated case intertwining questions of legal misconduct, the limits of the attorney-client privilege and the rights of defendant companies to recover costs when they are hit with unfounded accusations.
Hagens Berman has fought fiercely against its opponents every step of the way, seeking to keep testimony sealed and trying to withdraw from representing clients who accused it of wrongdoing. The case is still being actively litigated, although the special master investigating allegations against Hagens Berman has temporarily suspended hearings due to the COVID-19 crisis.
In her lawsuit, Sampson, a Minnesota resident, says she was born with profound birth injuries in 1962 but nevertheless married, raised children and had a successful career as a journalist and marketing consultant. She said her mother took “certain capsules” during pregnancy and contacted an attorney in 1982 about a possible lawsuit. That attorney couldn’t get her mother’s medical records and a capsule Sampson found in her mother’s effects didn’t test positive for thalidomide.
In 2011, Sampson posted a question on a private Facebook group for thalidomide victims and seven days later, she got a call from a woman who connected her to a Texas attorney, Kay Gunderson Reeves. Sampson says Reeves told her the litigation would be wrapped up in less than two years and the fact she investigated the claims years earlier strengthened her lawsuit because only “new information” made it possible for her to discover thalidomide was to blame for her birth injuries.
Hagens Berman soon joined the litigation team (replacing Houston lawyer Mark Lanier) and filed Sampson’s case, along with more than 50 others, in Pennsylvania along with juicy allegations like thalidomide was developed by doctors who had served time as Nazi war criminals, and the drug was handed out to women in unmarked envelopes in doctors’ offices around the country with no records kept. Hagens Berman issued numerous press releases seeking potential clients and defending its conduct even as the cases collapsed.
Hagens Berman sent Sampson a letter in 2014 asking her to dismiss her claims against Glaxo, saying the company didn’t distribute thalidomide at the time her mother was pregnant. The letter disclosed Glaxo was seeking sanctions against Hagens Berman and would withdraw the motion in exchange for dismissal.
Sampson says the letter was still misleading because it failed to note that Glaxo was leading the industry’s defense and that dropping its motion for sanctions would represent “a multimillion-dollar windfall for the law firm” while plaintiffs received nothing.
Sampson says she learned of the falsified expert report, which was altered to make it more discouraging about another plaintiff’s chances of success in court, in 2018 and called a Hagens Berman partner for an update on her case. She says the partner responded, “Oh, no wonder you don’t trust us. We thought those documents were sealed.”
She says she then spent many hours and thousands of dollars investigating alleged misconduct by her attorneys and flew to Philadelphia at her own expense to meet with the special master.
“After nearly a decade of uncertainty and anxiety about the outcome of her case against the pharmaceutical company defendants in the underlying thalidomide litigation, Sampson is now aware that her own lawyers had been providing her with misleading, incomplete, and false information about her case and her prospects for recovery,” she says.
The language in Sampson’s lawsuit echoes some of the phrases in the reports by Special Master William T. Hangley, who was assigned to the case in 2014 and is still investigating claims Hagens Berman misled its thalidomide clients. In one memorandum, Hangley wrote:
“False hope is a cruelty. Persuading (a plaintiff) to sue, without telling him that he has long since missed his main chance in litigation (if he ever had one) is not a kindness.” The plaintiffs “have had their hopes raised irresponsibly and then dashed, and there was never any good excuse for Hagens Berman’s doing that.”
The sanctions ordered by U.S. District Judge Paul S. Diamond have been on hold pending resolution of the underlying litigation. In a February order, the judge allowed Sampson to withdraw the dismissal of her case. The court also has allowed several plaintiffs to obtain sealed records regarding the investigation of the falsified expert report.