Opinion ID: 2431
Heading Depth: 1
Heading Rank: 1

Heading: facts

Text: Zyprexa is an anti-psychotic drug manufactured by Eli Lilly and Company (Lilly). It has been prescribed for the treatment of schizophrenia and bipolar disorder in over twelve million patients. The litigation below involved over 30,000 individuals who were prescribed and took Zyprexa and claimed that they consequently suffered injuries. [1] Many of these individuals filed personal injury law suits in state courts across the country. Lilly removed most of the cases to federal district courts. Some Zyprexa plaintiffs moved to remand in the districts to which the cases were removed, arguing that the federal courts lacked subject matter jurisdiction. Beginning in 2004, the Judicial Panel on Multidistrict Litigation (JPML) transferred thousands of the Zyprexa cases from federal district courts throughout the United States to the Honorable Jack B. Weinstein in the Eastern District of New York for coordinated or consolidated pretrial proceedings. [2] Any pending motions, including remand motions filed in the transferor districts, accompanied the transferred cases. [3] Soon thereafter, Judge Weinstein appointed a Plaintiffs' Steering Committee (PSC I) composed of attorneys from thirteen law firms who represented various individual plaintiffs. PSC I was responsible for, among other things, coordinating and conducting pretrial discovery for all plaintiffs, speaking for all plaintiffs in pretrial proceedings, making and arguing any motions, and pursuing settlement. [4] In November 2005, virtually all of the cases then pending in the MDL were settled. [5] The settlement contemplated the creation of a claims administration process pursuant to which settling cases were divided into three tracks, attorneys fees were capped for cases in each track, and special masters were appointed to oversee and apply that process. [6] In early 2006, the district court entered an order which, as far as is relevant here, provided that the costs, disbursements and fees of the plaintiffs' steering committee shall be paid out of the general settlement fund to the extent approved by the special masters. [7] This was implemented in part by setting aside one percent of the gross settlement amount payable to each settling plaintiff in an escrow fund. [8] The district court then appointed a second Plaintiffs' Steering Committee (PSC II) to coordinate pretrial proceedings in the few non-settling early cases and in the thousands of incoming and remaining cases, most of which had been filed, removed to federal court, and subsequently transferred by the JPML following the original settlement. [9] Lilly and PSC II moved for the establishment of a fund to compensate the attorneys who had worked and would continue to work for the common benefit of all Zyprexa plaintiffs after the original settlement. The district court granted the motion and provided for the establishment of a common benefit fund with certain details to be worked out in subsequent proceedings. [10] In due course, the district court ordered that three percent of each remaining plaintiff's gross recovery, if any, whether from a settlement or judgment, be placed in an escrow account. [11] Half the money was to come from each plaintiff's recovery and half from fees otherwise payable to his or her attorney. [12] Any lawyer who worked for the common benefit of all federal Zyprexa plaintiffs, including but not limited to members of PSC II, were eligible to apply for compensation from this account. Compensation would be granted only on a showing that the attorney provided significant assistance to all plaintiffs. [13] If any money remained in the fund after all claims on it settled, it would be distributed on a pro rata basis to those who had paid portions of their recoveries into the account. [14] Petitioner-appellant the Mulligan Law Firm (Mulligan) represents over two thousand plaintiffs who originally filed their actions in state and federal courts in seven states and whose cases against Lilly are pending in the MDL. [15] Motions to remand sixty-one of these cases to state courts remain pending in the district court. In December 2006, Mulligan and Lilly agreed in principle to settle all of Mulligan's Zyprexa cases, although the settlement had not yet been implemented as of the date of argument, because the settling plaintiffs had not fully satisfied the preconditions to consummation. [16] Hence, it was not then certain that the settlement funds in fact will be distributed to the Mulligan plaintiffs. [17] Anticipating that the settlement would be finalized, the district court enjoined Mulligan from distributing settlement funds to itself or its clients until the fund administrator certified that three percent of the funds designated for each settling plaintiff had been set aside. [18] It specified that [p]ayments may be made to individual plaintiffs as soon as that can be done while ensuring that sufficient funds have been held back to comply with the three percent common benefit assessment. [19] As of the date of oral argument, however, the court below had not awarded any fees or costs out of the fund. Mulligan acknowledges that it will have the opportunity to oppose any award of fees in the event fee applications are filed. [20] Plaintiffs appeal the district court's order enjoining them from distributing any settlement funds without a certification that the set-aside had been made. [21] Alternatively, they seek a writ of mandamus ordering the district court to vacate the injunction.