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LAW TRIBUNEWeek of October 30, 2006 • vol. 32, no. 47 • $10.00 • www.ctlawtribune.com

A Recipe For ConflictsAs plaintiffs’ practice grows, dilemma can be ‘insolvable’

By DOUGLAS S. MALAN

In the end, multimillion-dollar contin-gency fee recoveries couldn’t keep

Hartford-based Robinson & Cole and thechairman and founder of its nationallyprominent mass tort group together underthe same roof.

Like for other high-end plaintiff prac-tices operating within large defense-ori-ented law firms, client conflicts eventuallyconvinced Alex H. MacDonald that greenerpastures lay elsewhere, he said.

Last month, he took the reputation hegained from brokering a record-breakingFen-Phen settlement and joined forces withtwo high-profile Philadelphia trial lawyersto form MacDonald Rothweiler Eisenberg.

The message to other defense firms: dab-bling in plaintiffs’ work can be lucrative, butthe more lucrative it gets, the moreinevitable an eventual break-up becomes.

MacDonald said his departure fromRobinson & Cole was “amicable,” but essen-tially unavoidable. “However supportive thefirm and available the resources, you’re stilltalking about an approach to practice thatinevitably has limitations,” he said,“becauseof other work being done in the firm that ispotentially at loggerheads with the plain-tiffs’ practice.”

The dilemma over client conflicts “reallyis insolvable even in the most flexible lawfirms,” MacDonald maintained. “It hap-pened with enough frequency [at Robinson& Cole] that it finally came to the point thatthe better and necessary course for my

clients was that I leave. It was a difficultdecision.”

Specifically, MacDonald said, it wasRobinson & Cole’s longtime representationof Pfizer Inc. that prevented his group inlate 2004 from participating in litigationover the arthritis medicine Vioxx becausePfizer produced a similar drug. A few yearsearlier, the mass tort group was barred fromtaking Rezulin litigation after Pfizerannounced it was on the verge of acquiring

Warner-Lambert, the company that madethe diabetes drug.

Different EconomicsWhen not handling criminal defense

work, Shipman & Goodwin partner JamesA. Bergenn focuses between 20 percent to40 percent of his practice on representingplaintiffs in big-ticket wrongful death andpersonal injury cases. “The frustration ofturning away a number of large cases

Edward J. Sullivan, Esq. is managing director of Bingham Legg Advisers LLC

in Boston. Previously, he was senior vicepresident, regional manager, Connecticut,

for Fleet Investment Services.

Alex H. MacDonald,who founded andchaired Robinson &Cole’s mass tortgroup, said hisrecent departurefrom the firm was‘amicable,’ butessentiallyunavoidable. Thedilemma overclient conflicts‘really is insolvableeven in the mostflexible law firms,’he said.

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because of conflicts tends to discourageattorneys receiving those referrals fromcontinuing to do the work, or from stayingat the firm where they have to turn [suchcases] down,” Bergenn agreed.

For Bergenn, the trade off in working ata large defense firm like Hartford-basedShipman is the joy of having such a variedcaseload. “You just get used [to the clientconflicts] and you get over it. There’s plentyof work to do. [When a conflict arises], Irefer cases to other firms. I’m confidentbased on my experience that other [plain-tiffs’] cases will come in.”

In Westport-based legal managementconsultant Peter A. Giuliani’s estimation,no more than 15 percent of large defense-oriented firms across the country have aplaintiff practice component to them. Andthose that do, generally keep that compo-nent to between 10 percent and 15 percentof the firm’s overall business, said Giuliani,of Smock•Sterling Strategic ManagementConsultants. What plaintiffs work they do islargely kept to commercial disputes ratherthan personal-injury cases.

The most successful plaintiffs’ practicesidentify the cases that will pay out multiplesof a firm’s time and litigation costs. The riskof sinking lots of resources into a case thatdoesn’t pay off, however, runs counter tothe steady, hourly-rate cash flow of defensework, Giuliani noted.

“There’s usually a tension in these firms”between the defense and plaintiffs’ prac-tices, Giuliani added. “There’s the strongcash flow of defense cases being suckedaway by contingency cases. If you want tobe liked [as a plaintiffs’ lawyer], the hit ratein a defense firm has to be a lot higher thanin a plaintiffs’ firm.”

The irregular income stream that comeswith contingency cases, Bergenn noted, alsomakes it difficult for defense firms to gaugethe worth of their plaintiffs’ lawyers. “[T]hewait for the payment curve to ‘mature’comes at a cost when all other attorneys arecollecting [regular fees] as they do theirwork,” he acknowledged.

‘Enormously Profitable’MacDonald’s affiliation with Robinson

& Cole began when it absorbed the Bostonlitigation firm of Harrison & Maguire in1993. Running the mass tort group fromR&C’s Boston office, MacDonald’s profilegrew exponentially after he was retained bythe family of Hingham, Mass., resident

Mary Linnen.Linnen had taken the popular diet drug

Fen-Phen to lose weight prior to her wed-ding. After her 23-day exposure to the drug,she died of primary pulmonary hyperten-sion (PPH), launching a historic wrongfuldeath action against Madison, N.J.,-basedAmerican Home Products, parent companyof Fen-Phen maker Wyeth-Ayerst. The case

of his cases. “One [partner] said, ‘How canwe be gambling this kind of money?’”MacDonald recalled. “[I] commend anold-line law firm that did not have a longhistory of [specializing in high-stakesplaintiffs’] personal injury or wrongfuldeath [cases] being willing to support anew lateral partner in a case that wasextremely high-stakes,” he said. “Few other

The irregular incomestream that comeswith contingencycases makes it diffi-cult for defense firmsto gauge the worthof their plaintiffs’lawyers, saidShipman & Goodwinpartner James W.Bergenn.

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became the subject of the nonfiction bookDispensing With The Truth, by AliciaMundy.

As the court-appointed overseer of themulti-district litigation, MacDonald helpedbroker a $4 billion settlement of 200,000Fen-Phen diet pill claims.When approved in August2000, it became one of thelargest mass tort resolutions inU.S. history.

MacDonald said he and hisfive-lawyer trial team spent $1million in litigation costs and$2.5 million in billable timebefore the Linnen case everwent to trial. To that point,MacDonald had never frontedmore than $100,000 in costsand never more than $250,000in time leading up to a single trial, he said.

The level of the firm’s investment in theLinnen case initially stunned Robinson &Cole partners, but MacDonald noted thatthey “never” shortchanged funding for any

major firms would’ve done so; Robinson &Cole did.”

MacDonald went on to serve as leadcounsel in 49 additional PPH wrongfuldeath cases linked to Fen-Phen exposure innine states.

From the time of the Fen-Phen settlement in 2000 toDecember 2005, contingencyfees brought in the mass tortgroup collectively amountedto $73 million, according toMacDonald. Of that amount,roughly $60 million was “pureprofit” for Robinson & Cole,he said. “Obviously, mass tortlitigation undertaken on thescale that marked my practicein the last decade—if under-taken with care and an

informed insight regarding what cases totake and which to reject—can be enor-mously profitable,” MacDonald said.

Robinson & Cole Managing Partner EricD. Daniels wouldn’t confirm the figures

The morelucrative the

plaintiff ’s workgets, the more

inevitablea break-upbecomes.

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‘If you want to be liked [as a plaintiffs’lawyer], the hit rate in a defense firmhas to be a lot higher than in a plaintiffs’firm,’ Westport-based legal managementconsultant Peter A. Giuliani said.

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provided by MacDonald. He saidMacDonald’s departure from the mass tortgroup, “from a practice standpoint, … wasnot disruptive.” His hope, Daniels added, isthat, “from an economic standpoint, itworks out for everyone,” as well.

“To my knowledge,” Daniels said, “wehave never lost a corporate client because ofwork our mass tort group was doing.” Insome cases, he said, “a client of a certainmagnitude probably is entitled to somekind of market exclusivity.”

The firm’s mass torts practice is nowchaired by Boston partner Steven B.Rotman, a veteran of the Linnen case.“Time will tell” what effect MacDonald’stransition will have on R&C’s six-membermass torts group, Daniels said.

Changing Attitudes?“Conflicts, Daniels maintained, are part

of everyday life at large firms. We have cer-tain clients within an industry that desire usnot to represent competitors. That’s notunique to mass tort.” He noted that, in thepast, conflicts have emerged between thefirm’s insurance coverage practice and itsenvironmental practice in which one siderepresented the insurance industry and theother manufacturers and policy holders.

Bergenn said that even perceived con-flicts prohibit some firms from taking casesout of concern for upsetting existingclients. “[A] firm representing a certainsubset of manufacturers would probablynot be comfortable taking on products lia-bility cases in the industry involved,” hesaid. “On the other hand, large firms’sophisticated clients increasingly are choos-ing their attorneys for their talent and skill,and without regard to the cases handled by

their colleagues.”Plaintiffs’ lawyer Richard J. Kenny, of the

Hartford firm of Kenny, O’Keefe &Usseglio, previously worked at Hartford-based Rome McGuigan. He agreed thatworking at a defense-oriented firm can hin-der a plaintiffs’ practice. “Most of the time,

lawyers at Robinson & Cole, MacDonaldsaid he could convince potential clients thathe had the wherewithal to stand on a levelplaying field with the world’s largestdefense firms.

“I had the extraordinarily good fortuneto be partner in a firm with unlimited

According to AlexMacDonald, from the time of the Fen-Phen

settlement in 2000to December 2005,

contingency feesbrought in by

Robinson & Cole’smass tort group

collectively amountedto $73 million.

resources,” MacDonald said. However, “thepractice reached a point that I didn’t need250 lawyers behind me.”

With 12 attorneys, MacDonaldRothweiler Eisenberg is double the size ofRobinson & Cole’s mass tort group. Thefirm’s partners include two past presidentsof the Philadelphia Trial LawyersAssociation, Kenneth M. Rothweiler andStewart J. Eisenberg. MacDonald, who willcontinue to be based in Boston, said hebrought “virtually all the cases in which Iwas primary counsel” with him to his newfirm. ■

it’s hard to take a case from a guy in the sub-urbs and send it to a major corporate lawfirm,” Kenny said. “People want to knowtheir plaintiffs’ cases aren’t going to get lostin the corporate shuffle.”

But with an arsenal of more than 200