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Judge Forms Committee to Allocate $93M in Fees in Xarelto MDL

April 17, 2020 | Posted in : Fee Allocation / Fee Apportionment, Fee Expert / Member, Practice Area: Class Action / Mass Tort / MDL

A recent Legal Intelligencer story by Max Mitchell, “Xarelto Judge Taps Attorneys to Allocate $93M in Fee to Leading Firms,” reports that the federal judge handling the $775 million settlement over the blood thinner Xarelto has established a committee of five attorneys to assess how up to $93 million set aside for leading plaintiffs firms should be doled out.

U.S. District Judge Eldon Fallon of the Eastern District of Louisiana tapped Pensacola, Florida, attorney Brian Barr of Levin Papantonio Thomas Mitchell Rafferty & Proctor; Andy Birchfield of Beasley Allen in Montgomery, Alabama; Leonard Davis of Herman Herman & Katz in New Orleans; Gerald Meunier of Gainsburgh, Benjamin, David, Meunier & Warshauer, also in New Orleans; and Levin Sedran & Berman attorney Michael Weinkowitz in Philadelphia to form what the judge referred to as a “fee allocation liaison counsel” in the Xarelto litigation.  The attorneys will be tasked with coming up with a recommendation for how the court should divide up the common benefit fund.

According to the judge’s order, Fallon had intended to seek input from counsel directly, but the recent outbreak of coronavirus changed those plans.  “In light of the COVID-19 pandemic currently impacting the world and in an effort to create a process that both defers to the official mandates for social distancing and furthers the interests of counsel and the court in finalizing all remaining fee and cost issues, the court will modify its prior practice in seeking needed input from counsel regarding common benefit fee allocation,” Fallon said.  “The designated fee allocation liaison counsel shall work in consultation and cooperation with the plaintiffs’ steering committee and the Xarelto plaintiffs’ counsel leadership in arriving at a fee and cost allocation recommendation to the court.”

According to Fallon’s order, Philadelphia Court of Common Pleas Judge Arnold New will also designate an additional member for the common benefit counsel.  In spring 2019, the nationwide litigation over claims that Bayer and Johnson & Johnson failed to warn about the risks of the blood thinner Xarelto came to a global settlement of $775 million.

The litigation involved nearly 25,000 claims pending in a multidistrict litigation in federal court, as well as nearly 2,000 pending in Pennsylvania state court.  Although some of the theories that were presented in the six cases that went to trial differed slightly, all of the filed cases are based on claims that Bayer and Janssen Pharmaceuticals, a subsidiary of Johnson & Johnson, failed to adequately warn that the drug could cause dangerous bleeding episodes, stroke and death.  The settlement came after several defense wins in both federal and Philadelphia state court.

Late last month, Fallon granted a request by the plaintiffs steering committee allocating up to $93 million, or 12% of the settlement funds, for the common benefit fund.  “Throughout this litigation, the court has recognized the complex nature of this multidistrict, multi-party litigation.  At all times during this case—and still today—Xarelto has been available on the market and is widely prescribed,” Fallon said.  “Therefore, this litigation was particularly challenging and complex for plaintiffs.  The court finds that the benchmark percentage adequately considers the novelty and difficulty of the questions presented by this particular case.”

The order noted that so far 70 firms have submitted time and expenses to the court-appointed accountant.  In an emailed statement, Weinkowitz said the Xarelto litigation is a model of state and federal cooperation that has been “strongly encouraged and facilitated by Judge Fallon and Judge New.”

“As a result, the MDL and state court attorneys worked very well together to advance the litigation on both fronts,” Weinkowitz said.  “I am proud to have been a part of the joint effort, and am grateful for the appointment to the committee.”