As Merck wins yet another Vioxx trial, analysts have been discussing what this means for Merck's strategy of defending every case individually. But there is another reason why Merck should not agree to a global settlement, one not regularly discussed in the press: fraud is pervasive in mass tort litigation, even in Vioxx litigation, and settling now without safeguards puts Merck in danger of being hit with the billions of dollars of fraud that have infected asbestos and fen-phen settlements.
Resident Fellow Theodore Frank
But even that story understates how outrageous the verdict was. Mr. Garza never had a prescription for Vioxx. Mr. Garza's widow testified that Dr. Michael Evans gave her husband an eight-day sample of Vioxx in a brown vial, and that then Dr. Juan Posada gave her husband two more vials filled with fifteen pills each and told him to return in thirty days. Her testimony contradicted what she said at her pretrial deposition, but she argued that her memory had improved over the intervening time. The Garza family never produced these brown vials: Mr. Garza's son testified at trial he threw them away--though his trial testimony also contradicted his deposition testimony. In turn, Dr. Posada testified that he never gave out thirty days worth of Vioxx, and never gave Vioxx to Mr. Garza. Dr. Evans testified he gave out samples only in eight-pill blister-packs. Nevertheless, the jury bought the "brown vial" theory, and held Merck liable.
There were other shenanigans at the Garza trial; one of the plaintiffs for whom lawyers sought millions of dollars of damages for Mr. Garza's death was his daughter from a previous marriage who met her father only a few times.
Mr. Garza's case is hardly an exception. In the most recent New Jersey trial, Thomas Cona tried to become a "long-term" user by telling the jury that he had taken Vioxx for twenty-two months: he asserted that he only had seven months worth of prescriptions because his doctor gave him fifteen months worth of free samples. The Wall Street Journal reports that jurors in the federal Dicky Irvin trial were suspicious that Mr. Irvin had been taking several medications, but the plaintiffs "lost" all but the Vioxx. And the New York Times reports that, in the Alabama case originally scheduled to be the first Vioxx trial, the plaintiff's physical evidence of Vioxx usage consisted of a package manufactured after her husband died. (The parties agreed to a postponement on the eve of trial after Merck moved for, and the judge denied, summary judgment.) Plaintiffs dismissed with prejudice a federal case on the eve of trial under suspicious circumstances. So out of eleven cases that have gone to trial or almost gone to trial, there is a reasonable suspicion that plaintiffs faked Vioxx usage in as many as five of them. How many more of the tens of thousands of pending plaintiffs have similar flaws?
Is there a mass-tort case where fraud has not been a substantial factor? Good products like Bendectin have been driven from the American market because of litigation driven by junk science. When companies like Wyeth and Congoleum try to arrange settlements, they become chum in the water and find their resources drained by thousands of fraudulent claims of injury.
Years after the problem was first identified by gadflies like Lester Brickman and Walter Olson, there is finally a criminal investigation arising from a particularly blatant example of fraud where thousands of silicosis diagnoses were manufactured out of whole cloth by doctors literally rubberstamping claims. But in the Vioxx cases, the Garza family has been awarded millions; and Mark Lanier will be awarded his fees in the Cona case because of a favorable verdict on a consumer-fraud claim. Perhaps appellate courts will get around to correcting these travesties, but the plaintiffs' bar is counting on enough bad verdicts to slip through the cracks to make these cases profitable.
The equation of expected returns is certainly helped by the fact that no one is even suggesting that presenting this sort of questionable evidence is unethical, much less illegal. Drug safety is important, but so are the health costs from vaccines and drugs not marketed because of liability risks. If the judicial system cannot police itself adequately, the question then becomes why we want to entrust national drug safety policy to an elected judge and a handful of randomly selected jurors in Starr County, Texas?
Ted Frank is a resident fellow and the director of the Liability Project at AEI.