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It’s not every day that a company can claim victory after agreeing to pay $4.9 billion. But not every company faces $20 billion in liability from an avalanche of lawsuits. In November, Merck & Co. decided to end the litigation war over its prescription pain killer, Vioxx. Merck says the settlement validates its get-tough policy of fighting each case individually � a policy that has resulted in a legal tab of roughly $1 billion over the last few years. The Vioxx litigation began back in 2001, but went fully nuclear after the company took the drug off the market in September 2004. Since then Merck has been hit with about 26,600 lawsuits, according to company documents. The deal is expected to close an estimated 45,000 to 50,000 state and federal lawsuits. But to do that at least 85 percent of the plaintiffs must agree to the deal before it can be finalized. The deadline for approval comes in January. Before the Vioxx deal, conventional wisdom held that pharmaceutical companies held a losing hand in court and should settle quickly and quietly. Instead, Merck told anyone and everyone that it would take every legal spat before a jury. The first trial didn’t go too well. Texas trial lawyer W. Mark Lanier of the Lanier Law Firm dinged the company for a $234.4 million verdict in 2005 representing the widow of a man who died after taking Vioxx. But out of the next 20 cases tried, 15 ended in defense verdicts or hung juries. With each victory Merck gained more leverage to negotiate with plaintiffs. The final marathon settlement talks lasted nearly 24 hours at the New Orleans offices of Russ Herman, liaison counsel for the plaintiffs. Herman says the primary lawyers for the plaintiffs included Christopher Seeger of Seeger Weiss, Andy Birchfield of Beasley Allen, and Arnold Levin of Levin, Fishbein, Sedran & Berma. Merck was represented by Douglas Marvin of Williams & Connolly, John Beisner of O’Melveny & Myers, and Adam Hoeflich of Bartlitt Beck. “It was a true, hard-fought, rough and tough negotiation on a very high professional plane,” says Herman. Time will tell if Merck’s get-tough strategy becomes the new conventional wisdom.
Nathan Carlile can be contacted at [email protected].

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