Law firms clash over drugs whistleblower fee deal

Two US east coast law firms are in high-profile row over fees following a $1.5 billion settlement between a global pharmaceuticals company and the US government.
Drugs settlement sparks fee row

Drugs settlement sparks fee row

The Reuters news agency reports that in a lawsuit filed last week in the New York Supreme Court, Madison Avenue’s Wolf Haldenstein Adler Freeman & Herz claimed that Delaware boutique Grant & Eisenhofer had failed to pay at least $150,000 of the settlement's legal fees.

Illegal rebates

The squabble dates from 2007 when former Wolf Haldenstein partner Reuben Guttman – who originated the federal whistle-blower lawsuit against Illinois-based Abbott Laboratories, and a frequent blogger for The Post – left to join Grant Eisenhofer, taking the action with him.
The suit alleged that the healthcare company illegally promoted unapproved uses of its drug Depakote and paid millions in illegal rebates to pharmacists to recommend the drug to elderly dementia patients to treat schizophrenia even though the medication was not approved for that use by the US Food and Drug Administration.
In Wolf Haldenstein's lawsuit, the firm claims that Grant Eisenhofer agreed to pay Wolf Haldenstein for the time its lawyers spent on the case in the event of a victory.

Huge settlement

Following the $1.5bn settlement last May -- the third-largest payment by a pharmaceutical company in a lawsuit -- Wolf Haldenstein wrote to Mr Guttman to congratulate him and remind him of the agreement that his new firm should pay Wolf Haldenstein its share of legal fees, according to the lawsuit. But, said the claimant firm, Grant Eisenhofer refused to discuss the matter and offered no reason for its refusal.
The agency reported that Stuart Grant, managing director of Grant & Eisenhofer, and Mr Guttman are yet to comment. Mark Rifkin, a partner with Wolf Haldenstein who filed the lawsuit, declined to comment.

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