Medicare kicked off injury suit recovery in '09

By Steve Korris | Jun 17, 2010


BIRMINGHAM, Ala. – Kicking off a campaign to recover proceeds of personal injury suits, lawyers for Medicare claim a share of a $300 million settlement of chemical contamination claims in Anniston, Ala.

In federal court last December, assistant attorney general Tony West sued Monsanto, its affiliates, their insurers, and personal injury lawyers who collected $129 million.

West was nominated in 2009 by President Barack Obama to serve in the Justice Department's Civil Division. He was confirmed by the U.S. Senate on April 20, 2009.

The Monsanto settlement, in 2003, resolved claims involving polychlorinated biphenyls, or PCBs.

West borrowed a page from the book of plaintiff lawyers, filing a sketchy complaint that stretched the statute of limitations and incorrectly identified defendants.

He sought double damages from seven lawyers, six law firms, Monsanto, Solutia, Pharmacia, Travelers, and AIG.

He moved for summary judgment on liability in January, writing that a ruling "could provide a framework for settlement discussions among all parties."

"The damages issues could be contentious, and a ruling on liability will help focus that phase as well," West wrote.

He wrote that 907 Medicare beneficiaries received payments through the settlement.

He wrote that Medicare paid more than $67 million on their behalf from 1991 to 2009.

That equals an annual average of about $4,000 per person.

Lawyer James Stricker of New York, as lead defendant, moved in February to dismiss.

Todd Lowther of Birmingham wrote for Stricker that the complaint didn't identify beneficiaries or describe their medical conditions.

The fact that a plaintiff received benefits doesn't mean the government can claim reimbursement, he wrote.

Solutia moved to dismiss, branding the complaint as fatally deficient.

"As pled, the government's claims for reimbursement include any treatment ever provided to those Medicare beneficiaries, including illnesses and injuries such as the flu or a herniated disk," David Wells of Birmingham wrote.

AIG and Travelers moved in May to dismiss, initially arguing that West sued holding companies rather than insurers.

Their lawyer, Carol Cohen of Washington, wrote that a complaint must include more than labels and conclusions.

She wrote that most of the settlement was allocated to property damage and attorney fees.

"Nowhere in the settlement agreement, or elsewhere, is there any reference to any particular medical condition, treatment, or service that is being compensated by the settlement payments," she wrote.

"Indeed, the complaint does not even allege that any particular medical condition or treatment resulted from or was necessitated by exposure to PCBs," she wrote.

She wrote that Medicare might have paid for broken bones from an auto accident or for an appendectomy.

All the defendants invoked statutes of limitations, arguing that time had run out whether a three year limit or a six year limit applied.

West amended the complaint on May 26, adding five subsidiaries of AIG and Travelers.

U.S. District Judge Karon Bowdre presides.

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