Merck & Co. Inc. has dropped New Jersey's Lowenstein Sandler from its appeal of a $13.5 million Vioxx case to prevent recusal of a potentially pro-company state Supreme Court justice who the firm represents in a private matter.
Lowenstein partner Douglas Eakeley, who won a split decision in the Appellate Division in May, won't reprise his arguments in the state Supreme Court because since February he has been defending Justice Roberto Rivera-Soto against a complaint that the justice abused the power of his office to gain advantage in a private dispute.
Eakeley agreed to handle the justice's case at the request of the state attorney general's office, which provides representation to judges sued for alleged misuse of office.
Merck and 250-lawyer Lowenstein Sandler agreed it would be better for Eakeley and the firm to refrain from working on Merck's petition for certification, filed June 30, rather than force Rivera-Soto's almost certain recusal from a case argued by his personal counsel, lawyers familiar with the situation say.
"The representation did not change because of anything they did or didn't do in their appellate work," Merck spokesman Kent Jarrell says of the firm's lawyers. "They did a very good job in the early arguments."
O'Melveny & Meyers, led by John Beisner in Washington, D.C., and Dechert, led by Ezra Rosenberg in Lawrenceville, N.J., were co-counsel with Lowenstein Sandler on the appeal and will remain in the case. Rosenberg says no decision has been made on who would argue if the court grants the petition for review in the case, McDarby v. Merck & Co. Inc., docket 62,856.
Rivera-Soto, a former federal prosecutor, in-house counsel for Atlantic City casinos and partner at Fox Rothschild, is widely viewed as the most conservative justice on a court with a reputation for plaintiff-friendly jurisprudence in tort and product liability cases.
In two Vioxx cases already heard by the court, he voted with the majorities that handed Merck significant victories.
It remains an open question whether the justice, even after Eakeley's departure, will remain jittery enough about an appearance of impartiality to step down from a case in which his attorney played a central role in an earlier stage.
Ellen Relkin of Weitz & Luxenberg in New York, who represents McDarby, declines to comment, so it is not known whether she would ask Rivera-Soto to recuse himself.
Another justice, Barry Albin, has already recused himself, without stating the reason publicly. He typically does not hear cases affecting his former firm, Wilentz, Goldman & Spitzer in Woodbridge, N.J. That firm is not in the case on review, but does represent plaintiffs in other Vioxx cases.
Merck has faced claims worth billions of dollars that it knowingly failed to warn the public that Vioxx, an arthritis painkiller, increased the risk of heart attacks and caused the deaths of some users.
The McDarby case is particularly important because it is the first Vioxx damages verdict in New Jersey ripe for review. A doctor prescribed Vioxx to John McDarby in March 2000 and he took it daily until suffering a nonfatal heart attack on April 15, 2004, at age 75.
Last May, the Appellate Division affirmed a jury's $4.5 million compensatory damage award, but Merck won reversal of a $9 million punitive damage award on grounds applicable to other Vioxx cases in the state.
One of the issues is whether federal law pre-empts the state Product Liability Act on the adequacy of prescription drug labeling. The court's decision will affect more than 1,700 other New Jersey plaintiffs who are not taking part in a $4.85 million global settlement of 47,000 claims, Merck says in its petition.
In June, the state Supreme Court ruled in Sinclair v. Merck, 948 A. 2d 587, that the PLA did not provide a cause of action seeking medical monitoring for Vioxx patients with no symptoms.
In 2007, in International Union of Operating Engineers Local No. 68 Welfare Fund v. Merck, 192 N.J. 372, the state high court blocked an attempt by unions and health insurers to pursue a class action under the state Consumer Fraud Act to recoup payments for Vioxx prescriptions.
Rivera-Soto voted with the 5-1 majority in the medical monitoring matter and the 5-0 majority in the class-action case.
The private suit Eakeley is handling was lodged by a high school classmate of Rivera-Soto's son, and is the outgrowth of a series of incidents that led to the justice's censure by the Supreme Court for an ethics violation in 2007.
Rivera-Soto's colleagues found that he had attempted to use his position to influence a juvenile delinquency case in which his son Christian was the complaining witness against Haddonfield High School football teammate Conor Larkin.
The delinquency case, stemming from alleged bullying incidents, was settled, but Larkin filed a grievance alleging the justice had made unethical contacts with school and law enforcement authorities to influence the matter.
In February, Larkin filed a civil rights and abuse of office suit against Rivera-Soto and said the justice's action had caused emotional distress and violated the youngster's right to a public education.
There are three defense counsel in the case: a private lawyer representing the justice as a private citizen, a deputy attorney general defending a negligent-supervision claim and Eakeley, representing the justice in his official capacity. The state has a tradition of calling in high-profile lawyers as co-counsel to staff attorneys in such multidefendant complaints arising from the actions of leading officials.
Besides representing major corporations in complex litigation, Eakeley is a former first assistant attorney general. He served from 1993 to 2003 as chairman of the Board of Directors of the U.S. Legal Services Corp. -- an appointment that started during the presidency of fellow Rhodes scholar and Yale Law School classmate Bill Clinton.
Eakeley declines to comment, but David Wald, the spokesman for Attorney General Anne Milgram, says Eakeley acknowledged when he agreed to take the Rivera-Soto representation that it could cause conflicts with cases he might have to argue in the Supreme Court.
"He knew going in there was a potential for recusal," Wald says.
Lawyers at Lowenstein Sandler appear to be taking a "these things happen" attitude, reasoning that a firm without conflicts is a firm that doesn't have a lot of interesting clients.
"Somebody like Doug is going to have conflicts because he's a player and what are you going to do?" says managing partner Gary Wingens.
As for whether Eakeley's argument in the Appellate Division is so removed as to allow Rivera-Soto freedom to hear the Vioxx appeal, Hofstra School of Law professor Monroe Freedman says, "I would say that it does not, but it's not as obvious a situation" as arguing in the Supreme Court.
Freedman, who serves as an expert in judicial conduct cases, bases his view on a reading of the American Bar Association's 2007 update of the model rules of judicial conduct, which says in Rule 2.11 that judges shall disqualify themselves in any proceeding in which their impartiality "might reasonably be questioned."
But New Jersey's standard is different and appears to require more of a showing than the ABA before a judge must step down. It's not what a man in the street might question, it's what people in the case have reason to believe.
Under the state's catchall provision, R.1:12(f), judges are barred from sitting for any reason "which might preclude a fair and unbiased hearing and judgment, or which might reasonably lead counsel or the parties to believe so."