We tried the State of Alabama’s Medicaid fraud case against the three Watson companies starting on June 22nd. While the trial, which lasted for three weeks, went extremely well, the jury was unable to reach a verdict and Judge Price had to declare a mistrial. The case tried as well –if not better – than any of the cases we tried previously against four other drug companies. All of those cases resulted in substantial verdicts for the State.
The jurors in the Watson trial reported that they were deadlocked within a short time after going out to deliberate. I understand that the count was 8-4 throughout the jury deliberations in the State’s favor and that toward the end two jurors said they would compromise for a lesser amount of damages and vote for the State. That would have made the count 10 to 2. However, one of the jurors reportedly said she would never return a verdict for the State and that forced a mistrial.
I must admit that I was surprised at a mistrial in what we all considered to be a very strong case. For example, we had an internal company document that came directly from a meeting of Watson officials and lawyers in 2000 admitting that what had been taking place on the reporting of false prices would be considered “fraud.” We also had a document that said the reported prices would serve as a “smoke screen” to the true prices being reported to the state Medicaid agencies.
Regardless of the outcome in this case, I believe strongly in the civil justice system and in folks who serve on juries and who are so important to the judicial process working as it should. I am convinced that jury service is one of the most important duties of citizenship in this country. I sincerely believe that, and know that without the jury system ordinary folks would have absolutely no chance in many situations that arise and affect them. Our history is full of good examples of this basic truth. Unfortunately, there are many groups in our country working hard to destroy the civil justice system and specifically to take away the right to trial by jury. Hopefully, these groups will never succeed.
I trust the jury system and take full responsibility for not doing my job well enough in the Watson case. During the trial, we had an opportunity to settle with four companies, including Watson, for $40 Million. But since our actual damages for those four companies exceeded $102 Million, and the Defendants’ offer would include no punishment for what we knew to be bad conduct by this group of Defendants, we turned their combined offer down. We had tried cases against four other companies already and separate juries had returned verdicts against them totaling $500 Million. In addition, we had also settled with a relatively small group of companies for a total of $124.5 Million. Currently, there are still cases pending against 55 other companies. All told, the drug manufacturers cheated Alabama Medicaid out of over one billion dollars and that we believe is a conservative number.
We will try the Watson case again starting on December 7th and hope for a good result. I take the responsibility of representing the State of Alabama, and especially the Medicaid Program, very seriously. I let lots of folks down in this trial, especially those who depend on Medicaid, and I feel badly for them. Hopefully, we all learned from this experience and if at all possible we will do a better job next time and in all other future trials.
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