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A federal judge on Monday chose the lead lawyers for pension funds suing Merck & Co. Inc. for alleged investment losses related to the drugmaker’s former blockbuster arthritis drug Vioxx. U.S. District Judge Stanley R. Chesler of the District of New Jersey named four law firms as co-lead counsel for pension funds that owned Merck shares before the company disclosed an internal study linking Vioxx to increased risk of heart attack and stroke. Whitehouse Station, N.J.-based Merck pulled Vioxx, whose $2.5 billion in annual sales equaled 11 percent of Merck revenues, from the market on Sept. 30. Merck shares, trading at $60 as recently as June 2003, plunged $12 to $33 that day, wiping out $28 billion of stock value for individual investors, pension funds and mutual funds. Nine law firms originally had been vying for the potentially lucrative position of lead counsel for the pension lawsuits. Seven of those had agreed to a lead counsel committee comprised of four of the firms and headed by Robert Izard of Schatz & Nobel PC of Hartford, Conn. Izard told Chesler the four firms had extensive experience in such litigation. Some lawyers had argued those four firms were already spread too thin, but Chesler agreed to the four-firm committee — after lecturing the 27 lawyers in his courtroom. Chesler said he found the “skirmishing and sniping” in pretrial motions from lawyers arguing over who should run the case “distasteful.” “This court could not care less in terms of which firms get a bigger piece of the pie,” he said. Chesler ordered the two firms that also had sought to be lead counsel to be included on a lawyers’ committee that will oversee pretrial discovery. He said he would consider a motion by one of those two firms to add to the lead plaintiffs its client, Zeph Ugwuneri. The only plaintiff at Monday’s hearing, Ugwuneri, an analytical chemist laid off by Merck in 2003, said after the hearing that the company had pushed him to put up to 25 percent of his 401(k) contributions into Merck stock. Merck lawyers would not comment after the hearing. Besides handling the consolidated pension lawsuits against Merck, Chesler also will handle two other groups of lawsuits: securities suits filed on behalf of tens of thousands of individual investors and so-called “derivative” lawsuits, in which plaintiffs are suing Merck officials to recover money lost by the company. Separately, a federal judge in New Orleans is overseeing the early phases of hundreds of lawsuits filed by former Vioxx users alleging the drug harmed them. Analysts have estimated Merck’s liability for Vioxx at $4 billion to $30 billion, but the company has yet to set aside any reserves to cover legal costs. Merck shares closed down 37 cents at $34.43 in trading Monday on the New York Stock Exchange. Merck reports on its first quarter earnings on Thursday. Last week, Merck forecast earnings of 62 cents per share, up 6 cents from what analysts expected, citing strong overall sales, cost management and other factors. Besides Schatz & Nobel, the other law firms on the pension committee are: Keller Rohrback LLP of Seattle, Schiffrin & Barroway LLP of Radnor, Pa., and Cohen, Milstein, Hausfeld & Toll PLLC of Philadelphia. Copyright 2005 Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.

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