Pennsylvania Supreme Court leaves Houston firm Bailey Perrin Bailey’s contingent fee intact

Houston-based firm Bailey Perrin Bailey has won a victory at the Pennsylvania Supreme Court regarding its representation of the Commonwealth of Pennsylvania on a contingent-fee basis in a suit against the manufacturer of the prescription anti-psychotic medication Risperdal. In a 5-1 decision Aug. 17, Pennsylvania’s high court held that Janssen Pharmaceutica Inc. lacks standing to challenge Bailey Perrin’s representation under 71 P.S. §723-103. Chief Justice Ronald Castillo wrote for the Supreme Court majority in Commonwealth, Office of General Counsel v. Janssen Pharmaceutica Inc., “The obvious interpretation of Section 103 is that no party to an action, other than the Commonwealth agency involved in the action itself, may challenge the authority of the agency’s legal representation.” According to the Supreme Court’s majority opinion, in January 2008, the Office of General Counsel had filed a complaint against Janssen in the Court of Common Pleas of Philadelphia County regarding its marketing of Risperdal. In January 2009, after the trial court denied Janssen’s motion to disqualify Bailey Perrin as the Commonwealth’s counsel, Janssen filed an application for extraordinary relief in the Pennsylvania Supreme Court. As noted in the Supreme Court’s majority opinion, Janssen alleged, among other things, that Bailey Perrin’s contingent-fee agreement for 15 percent of any damages the firm recovers for the Commonwealth restricts the Office of General Counsel’s authority to settle the litigation for nonmonetary relief. But the Supreme Court’s ruling is a hollow victory for the Texas firm. Bailey Perrin partner F. Kenneth Bailey says, “The only silver lining in this so far has been the fact that we won at the Supreme Court on our representation.” As noted in the Supreme Court’s majority opinion, Court of Common Pleas Judge Frederica Massiah-Jackson of Philadelphia granted Janssen’s motion for a compulsory nonsuit of the state’s underlying litigation against Janssen on June 14. Bailey says the Commonwealth plans to appeal Massiah-Jackson’s decision. Edward Posner, Janssen’s attorney and a partner in Drinker Biddle & Reath in Philadelphia, declines comment on the case and refers questions to Janssen. Janssen spokeswoman Kara Russell writes in an e-mail that the company is disappointed by the Pennsylvania Supreme Court’s decision. “Lawyers representing a state in matters like this one should not have a financial interest in the outcome of the case,” Russell writes.
-- Mary Alice Robbins