Summary Judgment Motion Knocks Out Texas AG’s Vioxx Suit


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Summary Judgment Motion Knocks Out Texas AG’s Vioxx Suit

By Andrew Longstreth

November 23, 2009

Merck’s Vioxx troubles are still not completely behind the company, but if a ruling last week is any indication, the company may have less to fear.

After settling consumer claims two years ago for $4.85 billion, Merck still faced lawsuits by roughly a dozen state prosecutors over the withdrawn prescription painkiller. Last Friday, one of those brought by the Texas attorney general was dismissed in a summary judgment ruling by Texas state court judge Scott Jenkins. The AG, Greg Abbott, had accused Merck of violating the Texas Medicaid Fraud Prevention Act by not disclosing risks associated with Vioxx, which the company took off the market in 2004. The state was seeking more than $200 million, after trebling damages.

The grounds for Judge Jenkins’s ruling are hazy. We don’t have a copy yet, and we’re told that the order isn’t detailed. Merck’s summary judgment motion–which was argued by Richard Josephson of Baker Botts and John Beisner of Skadden, Arps, Slate, Meagher & Flom–denied that the company misled the state, and argued that Texas was attempting to stretch the medicare fraud statute beyond its scope. “This lawsuit is an effort by the state of Texas to obtain a windfall: to recoup money it spent covering a prescription drug for Medicaid beneficiaries even though it does not claim that the drug injured them or that it failed to work (and even though it cannot prove that alternative drugs would have been cheaper),” wrote Merck’s attorneys at Skadden and Baker Botts.

Merck stated in a press release that it faces a dozen similar suits brought by other attorneys general. Most have been consolidated before New Orleans federal district court judge Eldon Fallon in a multidistrict litigation proceeding. One of those cases, brought by the Louisiana attorney general, is scheduled to go to trial in April.

Beisner told us that Judge Jenkins’s dismissal of the Texas suit raises “real questions about the viability” of cases like those pending before Judge Fallon.

Jerry Strickland, communications director for the Texas AG’s office, gave us this comment: “Despite last week’s ruling, the state will continue its efforts to recover taxpayer dollars that were unnecessarily spent. We are considering all options for review of this ruling at both the trial and appellate court level.”

SOURCE The Am Law Litigation Daily

Read the full article here.



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