The Truth Behind Medical Device Litigation Commercials

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People increasingly ignore commercials, but those annoying ads pushing would-be plaintiffs to sign up for their ‘piece of the pie’ in the latest mass lawsuit scheme remain all too familiar.  

Specifically, lawyers troll for clients in those ads with promises that hide the disturbing reality behind their pitch.  Increasingly, hedge funds and private lenders bankroll trial lawyers hoping to profit from jackpot verdicts and settlements.

Medical devices, for example, are a frequent target of those profiteers.

As most Americans know, medical devices save lives and improve the quality of life for millions of people.  Yet, in those rare instances where complications occur, over-aggressive plaintiffs’ lawyers and their financiers stand ready to pounce.  In some cases, this growing industry even scares patients into unnecessary surgery, just to increase the damage calculations in its lawsuits.    

That may sound unbelievable, but the Department of Justice (DOJ) indicted two individuals earlier this year in a plot targeting women with transvaginal mesh implants.  According to the DOJ, a “surgical funding facilitator” and a licensed doctor fraudulently “enticed [women around the country] into agreeing to undergo removal surgeries.” The defendants also “paid bribes and kickbacks … in exchange for the referral of these women for surgeries.”

While DOJ indictments constitute an important step in deterring the worst criminal abuses, more scrutiny on the broader third-party litigation funding is needed, especially when it comes to conflicts of interest in the handling of funds from large settlements in medical device cases.  

For instance, some funds in settlement cases are controlled by trial lawyers who brought the cases and, instead of compensating injured patients, they fund organizations that campaign on various, sometimes unrelated, issues. In the most serious cases, programs intended to help victims are actually used to finance misinformation campaigns.  

That elaborate scheme of trial lawyers, medical lenders and hedge funds also includes high-level organizations and policy influencers.  For example, The National Center for Health Research (NCHR), led by Diana Zuckerman, advertises itself as an independent patient advocacy group.  One group, however, heavily funds it: the Common Benefit Trust (CBT).

Here’s why that’s important.  The CBT was established to, among other things, help pay for the removal of faulty silicone breast implants.  Unfortunately, the NCHR has instead used the CBT’s donations to advocate for private insurance companies to pay for removal surgeries, as opposed to the CBT itself.  The Trust has long been tapped to fund the plaintiffs’ trial bar, as well as public relations firms’ coffers to fund such things as anti-vaccination studies, mercury amalgam dentistry and other interests completely unrelated to breast implants.

Zuckerman’s role raises additional concern, because she sits on two FDA boards - the Reagan Udall Foundation and the Alliance for a Stronger FDA.  Considering her affiliation with the CBT, these positions give Zuckerman a disturbing amount of influence when it comes to regulatory policy, possibly in ways that would favor trial lawyers who fund her organization with zero transparency.  

Accordingly, DOJ indictments offer a good and necessary start, but more tough questions must be asked of those like NCHR, Diana Zuckerman and others who make a living by preying upon the patients’ fears.  The entire cottage industry of third-party litigation funding demands more transparency, so that actual victims can be better protected from plots that might seek to profit from their suffering.

Timothy H. Lee is Senior Vice President of legal and public affairs at the Center for Individual Freedom

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