Courts Reject Two Major Vioxx Verdicts

Two major court victories for Merck on Thursday pushed the litigation over the painkiller Vioxx closer to conclusion and highlighted the increasing difficulty that plaintiffs’ lawyers were having in winning lawsuits against big drug companies.

A state appeals court in Texas overturned a $26 million jury verdict against the company in a lawsuit brought by Carol Ernst, whose husband, Robert, died in 2001 after taking Vioxx. In reversing the verdict, the appeals court found that plaintiffs had not proved that Vioxx caused Mr. Ernst’s death.

Separately, an appeals court in New Jersey sharply reduced a verdict in another Vioxx case. The court ruled that the jury should not have been allowed to award punitive damages against Merck or to find that Merck had committed consumer fraud. Only compensatory damages of $4.5 million were permitted, the court said.

The rulings on Thursday leave lawyers for plaintiffs with just three victories, all with relatively small awards, in the nearly 20 Vioxx cases that have reached juries. Mark Lanier, a plaintiffs’ lawyer who was involved in both cases decided Thursday, criticized the decisions and promised appeals. But plaintiffs face an uphill battle.

Plaintiffs Find Payday Elusive in Vioxx Cases

In Carol Ernst’s eyes, two years ago she won a measure of justice.

On Aug. 19, 2005, a Texas jury awarded Mrs. Ernst $253.5 million after concluding that Merck & Company and its painkiller Vioxx had caused the death of her husband, Robert, in 2001. At a news conference after the verdict, Mrs. Ernst said she was pleased that jurors had punished Merck for hiding Vioxx’s heart risks. “This has been a long road,” she said. “I just know that it was a road that I had to run and I had to finish.”

But her comfort was premature. Merck, the third-largest American drug maker, appealed the verdict — which Texas laws on punitive damages automatically reduced to $26.1 million. Until higher courts rule on the appeal, Merck is not obligated to pay. So Mrs. Ernst, 62, has yet to receive any money.

In fact, none of the 45,000 people who have sued Merck, contending that they or their loved ones suffered heart attacks or strokes after taking Vioxx, have received payments from the company. The lawsuits continue, for now in a state of legal limbo, with little prospect of resolution.

In combating the litigation, Merck has made an aggressive, and so far successful, bet that forcing plaintiffs to trial will reduce the number of Vioxx lawsuits and, ultimately, its liability.

Merck Wins Latest Vioxx Case

Merck was found not liable in the seventh lawsuit over Vioxx, the arthritis painkiller that it pulled from the market because of heart attack risk, the company announced Thursday.

The jury of five men and two women found Vioxx was not a substantial factor in the heart attack of a 68-year-old New Jersey woman, a court clerk said. The trial was held at New Jersey Superior Court in Atlantic City.

The jury decided that although Merck failed to warn the plaintiff, Elaine Doherty, about the heart risks of taking Vioxx, it did adequately warn her doctor of such risks, the clerk said.

The panel also found that Merck did not commit consumer fraud or misrepresent Vioxx in marketing the drug to physicians or to the plaintiff, the clerk said.

Jim Fitzpatrick, an outside counsel for Merck, said in a press conference that the verdict “reiterates our strategy to defend these cases on an individual basis.”

Michael Galpern, attorney for Doherty, told CNNMoney.com that he had not decided whether to appeal, but his firm is representing more than 500 plaintiffs in upcoming Vioxx cases.

“This was actually a major victory for plaintiffs across the country as this was the first time that the jury was asked if Merck failed to warn the patients about the dangers of Vioxx and the answer was yes by a unanimous verdict,” said Galpern. “Unfortunately they found that Vioxx did not cause Mrs. Doherty’s heart attacks, and we are disappointed with that one.”

Jury: Merck was negligent

Merck has been held liable by a Texas jury in the first lawsuit involving its former blockbuster drug Vioxx, in a case that could have a profound effect on thousands of other cases filed against the company.

Plaintiff Carol Ernst has won her lawsuit in Texas Superior Court in Angleton, which blames Vioxx for the 2001 death of her husband, Robert Ernst, a 59-year-old marathon runner and Wal-Mart worker who was taking the arthritis painkiller at the time of his death. Ernst died of a heart attack.

The verdict held Merck liable for the death. Jurors voted 10-2 in favor of Ernst.

The jury awarded more than $250 million in total damages — $24 million to Carol Ernst for mental anguish and loss of companionship, and $229 million in punitive damages. Ernst’s Houston-based lawyer, Mark Lanier, said the punitive-damages figure was based on “the money Merck made and saved by putting off their product label changes.”

Lanier had been seeking $40.4 million in damages, and after the verdict, Lanier said that he expected the punitive-damages award to be reduced according to Texas law.

“Justice is a beautiful thing, isn’t it?” Lanier told reporters following the verdict.

Merck said it would appeal the decision. “We believe that the plaintiff did not meet the standard set by Texas law to prove Vioxx caused Mr. Ernst’s death,” said Jonathan Skidmore, a member of Merck’s legal defense team, according to a statement released by Merck.

Jury Finds Merck Liable in Vioxx Death and Awards $253 Million

In the first verdict of a Vioxx-related personal-injury lawsuit, a Texas jury found the drug’s maker, Merck, liable and awarded $253.5 million to the widow of Robert Ernst, who died in 2001 after taking the painkiller and arthritis medicine.

After deliberating for a day and a half, the jury of seven men and five women awarded Mr. Ernst’s widow Carol $24.5 million for mental anguish and economic losses. The jury also awarded an additional $229 million in punitive damages after finding that Merck had acted recklessly in selling Vioxx with knowledge of the risks associated with taking the drug. Two jurors dissented from the verdict, which did not have to be unanimous.

Merck plans to appeal the verdict, and such large judgments are typically reduced by higher courts.

Judge Ben Hardin of the Texas District Court announced the verdict on the fourth floor of the Brazoria County Courthouse in Angleton, about 40 miles south of downtown Houston, shortly after 1:45 p.m. Central Time.

Mrs. Ernst, her family and lawyers erupted in cheers and began to hug each other.

“The justice system in America works and it works very well,” W. Mark Lanier, the lead lawyer for Mrs. Ernst, said.

Jonathan Skidmore, a lawyer for Merck, the nation’s third-largest drug maker, said that the company continued to believe it had properly researched and marketed Vioxx.

“We believe the plaintiff did not meet the standard set by Texas law to prove Vioxx caused Mr. Ernst’s death,” Mr. Skidmore said.

With a flood of Vioxx lawsuits soon to reach juries, the size of the verdict may have important implications for both Merck and the entire drug industry, lawyers and analysts said. More than 4,000 Vioxx-related cases have been filed.

Merck has said it will fight every Vioxx lawsuit in court rather than settle cases and it reiterated that stance in a statement issued after the verdict was announced.

But today’s judgment illustrates the dangers of that strategy, especially because Mr. Ernst’s case had been viewed as relatively weak, lawyers said.

The jury award represents about 1.1 percent of Merck’s 2004 revenue, $22.9 billion, but it accounts for more than a third of the $675 million the drug maker has set aside for its Vioxx liabilities thus far.

The jury’s decision illustrates the legal dangers that drug makers face when they aggressively advertise their medicines to consumers, a practice that spread widely in the late 1990’s.

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