CINCINNATI (Legal Newsline) - Plaintiff lawyers leading federal opioid litigation dismissed as premature a challenge by their rivals in state court to a judge’s order that could steer hundreds of millions, or even billions of dollars in fees their way.
In a filing with the Sixth Circuit Court of Appeals, the Plaintiffs Executive Committee said there is no evidence lawyers representing state-court plaintiffs will have to share fees with their counterparts in federal court. Earlier this year, U.S. District Judge Dan Aaron Polster issued a “common benefit” fee order requiring plaintiffs to hand over 7.5% of any settlements they negotiate to the PEC, which consists of 21 law firms, most of whom frequently lead mass-tort multidistrict litigation.
Those firms have already negotiated more than $30 billion in settlements that will provide them with more than $1 billion in fees.
Lawyers with opioid lawsuits in state court filed a mandamus brief with the Sixth Circuit in June, seeking to block Judge Polster from enforcing the common-benefit fee order against them. They argued the judge has no jurisdiction over them and can’t order them to pay for legal services they never received.
The PEC filed their response Oct. 12, arguing the state-court lawyers lack standing because the CBO hasn’t been applied against them and may never be. They said Judge Polster’s order – hastily modified to clarify it applied only to federal cases – only will affect them if they use legal materials prepared by PEC lawyers in their own cases.
“Petitioners cannot demonstrate any actual or imminent injury caused by the CBO,” said the PEC firms, which include Motley Rice, Simmons Hanly Conroy, and Farrell & Fuller.
The state-court plaintiffs challenging the CBO include several Texas counties including Harris County, home to Houston; Albuquerque, N.M.; and hundreds of municipalities in Arkansas and South Carolina. Their lawyers, including Dan Downey P.C. of Texas and Cory Watson P.C. of Alabama, didn’t immediately respond to requests for comment.
While dismissing the state-court plaintiffs’ challenge as moot, the PEC lawyers went on to justify their share of any fees generated in the opioid litigation. They claim nearly 1,000 lawyers performed 1.3 million hours of work and PEC firms have spent more than $110 million out of pocket so far.
Those expenses are almost certain to yield a big return: Nearly $1 billion of the $26 billion settlement with drug distributors will flow to the PEC firms, representing an hourly rate of more than $750 even though much of the document-review work was likely performed by low-paid associates and contract attorneys. The lawyers have since negotiated $6.6 billion settlements with Allergan and Teva, likely yielding at least another $500 million in fees.
The PEC said they are entitled to such fees because they performed most of the work of writing briefs, deposing witnesses and churning through millions of pages of documents used by all the plaintiffs in opioid litigation. Judge Polster’s order requires lawyers who use documents produced in the MDL to abide by the common-benefit fee order, although he dropped the part of his order that would have prohibited state-court plaintiffs from subpoenaing documents and deposing witnesses on their own.
Since that is no longer part of the order, the PEC argued, state-court plaintiffs can’t ask the Sixth Circuit from blocking it.
“The District Court’s Clarifying Order eliminated any legitimate question regarding impact on other courts,” they wrote. “In short, the CBO does not `enjoin or preclude any state court from entering any discovery order it concludes is appropriate.’”