7 Game-Changing Settlements of 2009

December 15th, 2009. By Kristine B

We’re in the countdown to year-end and looking over some of the more impactful settlements LawyersAndSettlements.com has covered over the past year. When we’re talking impactful, everyone around here has an opinion—so we had to throw in some criteria. To get the nod for impact, a settlement had to be one of two things: 1. High dollar value; or 2. Precedent-setting—or at least have the potential to influence similar cases to follow. (Sounds simple, but you try getting Stephen, John, Jaime, Michelle and Ben to settle in on just 7 settlements with just those criteria…) So here we go…7 game-changing settlements for ’09…

1) Family takes on GlaxoSmithKline  

Michelle David filed a lawsuit against GlaxoSmithKline, alleging the company’s antidepressant, Paxil was responsible for her son’s birth defects. David said she had taken Paxil while pregnant and was not aware of the potential side effects. GlaxoSmithKline said that birth defects occur in between three and five percent of all live births, regardless of Paxil use. 

A jury found, in a 10-2 decision, that GlaxoSmithKline’s officials were negligent in failing to warn David’s doctor about the risks of Paxil. The jury also found that Paxil was a factual cause of the little boy’s heart problems. David was awarded $2.5 million.

Why it’s impactful:There are 600 or so lawsuits alleging Paxil caused birth defects waiting in the wings. Ever heard of the “snowball effect” (hey, it’s winter)—this award could have a substantial impact on those lawsuits. 

2) Wal-Mart Pays $40 Million to Massachusetts Workers  

Wal-Mart agreed to pay $40 million to end a class action lawsuit, filed by workers in Massachusetts who said they were denied meal and rest breaks and were not properly paid for overtime work. As many as 87,500 current and former employees could receive money from the settlement, which is reportedly the largest wage and hour class action settlement ever in Massachusetts. 

Why it’s impactful:It’s big, baby. $40 million is nothing to sneeze at. And it caps off a stream of labor lawsuits on wage and hour and overtime issues that just keeps a’coming. Think we’re kidding? Scroll through ’em. This one sends the message that the stakes may now be higher for companies that are less-than-diligent with their payrolls…

3) The Elderly Take on Florida

In October, elderly Floridians were given a $27 million settlement in their lawsuit against the state of Florida. The plaintiffs alleged they were forced into nursing homes by the state’s Medicaid program because it was prohibitively difficult to get funding for home or community-based care. 

Why it’s impactful: The ederly are some of our most vulnerable citizens–but not this set. They gave the state of Florida some what-for. And if they can do it…well… The $27 million will go to improving access to home and community based care settings, meaning that in the future, elderly people will have more care options. 

4) Drug Company in Trouble for Marketing Tactics

It’s probably no surprise to people that pharmaceutical companies engage in false and misleading marketing (allegedly!). But, a $1.4 billion settlement between Eli Lilly and the Department of Justice might just surprise some. Lilly was in trouble for (allegedly!) sending physicians materials that encouraged them to prescribe Zyprexa to elderly patients and children, even though the FDA had not approved the drug for those populations (note, the FDA did subsequently give Lilly the nod on Zyprexa for 13-17 year olds in June, and just yesterday the FDA approved the longer lasting Zyprexa Relprevv—but keep in mind, the patent on Zyprexa is up in 2011—so the scramble is on now to eek as much marketing mojo out of the brand). 

Why it’s impactful:Well, for starters, $1.4 billion. Sure, that’s probably not going to sink Eli Lilly, but it’s not pocket change either given it’s about 30% of Zyprexa’s reported 2008 sales. Second, it sends a message to other drug companies that big brother is watching what you say and to whom in your promotions. And that includes off-label use. 

5) Asbestos Lawsuit Nets $10.2 Million for Plaintiff

The plaintiff in a lawsuit filed against Scapa Dryer Fabrics, Inc and AstenJohnson was awarded $10.2 million related to the plaintiff’s exposure to asbestos and his development of mesothelioma. 

Why it’s impactful: There are hundreds of asbestos-related lawsuits out there. Who knows how many people have been exposed to asbestos and ultimately developed asbestosis or mesothelioma as a result. While the amount of this settlement is not huge, the fact that this lawsuit was filed at all points to the fact that asbestos-related disease tends to develop long after the period of exposure—so while the US and Canada continue to lack an all-out ban on asbestos, we continue to leave asbestos-related disease as our legacy, and sadly what many will have to look forward to—unwittingly—in their later years. The settlement itself may not influence future cases, but let’s hope the collective asbestos lawsuits—and the many lives lost—continue to serve as a impetus for a ban.

6) Woman Takes on Philip Morris

A 61-year-old woman was awarded a $300 million settlement in her lawsuit alleging that Philip Morris is responsible for her emphysema. The plaintiff now requires a lung transplant, which she cannot afford. In Florida, plaintiffs do not have to prove that nicotine is addictive, that smoking causes diseases and that tobacco companies hid those facts from smokers, because those elements were upheld in the first stage of a rejected class action bid.

Why it’s impactful: If the settlement stands up to an appeal by Philip Morris, it will help pave the way for thousands of other tobacco lawsuits. The verdict is the largest award of damages against a tobacco company in the US.

7) Wyeth Loses Preemption Lawsuit

In March, the Supreme Court upheld a $6.7 million award, given to a woman whose arm was amputated due to gangrene after she was given a shot of anti-nausea medication, Phenergan, to treat a migraine headache. Diana Levine sued Wyeth for failing to warn, alleging the company did not adequately warn about the risks of administering Phenergan through an IV procedure known as an IV push. 

Wyeth argued that federal law protected the company from state lawsuits and said the Food and Drug Administration approved the warning label.

Why it’s impactful: Wyeth tried to argue that because it complied with the FDA on its labeling, it should not be liable for a failure to warn. The case was closely watched because it could have a huge impact on future drug liability/preemption cases.

So there you have it…some of 2009’s most impactful lawsuit outcomes. Sure, there’s more, and we may well post some more. Likewise we look ahead to 2010 for a new batch of cases that are sure to have an impact—kicking off with the upcoming Chinese Drywall trial. So stay tuned…and if there’s a lawsuit or settlement you think should be on the list, let us know…

Tags: Asbestos, Eli Lilly, GlaxoSmithKline, Philip Morris, Wal-Mart, Wyeth

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