Sunday, December 8, 2013

Did patients draw the short stick in $2.5B J&J metal hip settlement?

Mass Device

MASSDEVICE ON CALL — When Johnson & Johnson (NYSE:JNJ) agreed to a $2.5 billion settlement to close some 8,000 cases over its metal-on-metal hip implants, about 1/3 of that money went to the lawyers and legal teams representing the cases.

Lawyers took an average of $90,000 of each patient's $250,000 award, according to a New York Times report, a hefty cut that has some patients irked about the value that their legal representation brought to their cases. One patient told the Times that he estimates that his lawyer did less than $4,000 worth of work, gathering medical records and paying legal fees.

Law offices ramped up their internet and television marketing in the weeks and months preceding Johnson & Johnson's DePuy ASR hip implant lawsuit, some gathering hundreds of claims.
The 33% cut has some patients up in arms and refusing to accept the settlement, especially those whose award was lowered due to the length of time that they had the implant or by other limiting factors such as age and weight, according to the report.

Healthcare giant Johnson & Johnson confirmed earlier this month that it agreed to a $2.5 billion settlement to close the books on one of the multi-patient lawsuits over recalled metal-on-metal hip implants made by subsidiary DePuy Orthopaedics.

The settlement closes a major chapter, but the story is far from over. There remain some 4,000 other lawsuits over the metal-on-metal hip replacement systems and patient advocacy groups want more than compensation; they want tighter oversight of the medical device industry.

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From Connie,

I finally did sign on with a firm but I do understand the issue surrounding the attorney's fees.  The question is what constitutes lawyer's fees?  The lawyers will collect something in the way of 33 and 1/3rd percent   of the net amount recovered.  Costs are taken out from the gross amount recovered which also goes to the lawyers.  (The net amount recovered is the amount remaining after all costs incurred in the preparation for , and prosecution and resolution of the case (filing fees, expert witnesses, depositions, medical records, research costs, expenses associated with coordinating and conducting discovery, trial preparation and trial.)

This is likely how it might shake out IF over 90% of the filers agree to the terms of the agreement.

                                                          $250K (gross amount recovered)
                                              minus   $ costs noted above incurred by
                                                               net amount recovered
                                              minus    33.3% of the net for attorney fees
                                                            patient gets what is left.

My key  questions would be as follows:

  • Are the lawyer fees double counted?  That is, are their fees included in any way in the costs? 
  • How will the State cases be settled and are they anticipated to be settled for an average cost that is higher than the Federal MDL?
  • Will there be any funds set aside to study the long term systems effects of the metals?
  • Will this recovery address the outstanding bills from health care providers like Blue Cross and how will that be handled?
  • If future claims arise from the complications, how will those claims be handled?  If the deal is that you must accept the settlement and this covers no future claims, I can't personally see taking this deal given I suspect there will be continued systemic issues which will arise from the metals.
If I have more questions, I will post them.  In any event, all of the filers get to vote.  If I am not mistaken, If at least 90% of those who actually filed a suit in Federal court through the MDL do not agree to the overall settlement, it won't go through.

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