SEATTLE – Hagens Berman Sobol Shapiro LLP and the Plaintiffs’ Steering Committee, the legal committee representing victims in federal court, today announced a $100 million settlement for victims who were exposed to tainted epidural steroid injections manufactured by New England Compounding Center (NECC), which caused a recorded 64 deaths. The tentative settlement announced late last year has now been reduced to writing, signed by the parties and filed with the bankruptcy court.

The 2012 outbreak was the worst such outbreak in U.S. history. The CDC ultimately recorded 751 cases of fungal meningitis and infections in 20 states, linked to tainted injections compounded and distributed by NECC.

“This is a good recovery given the reality of the bankruptcy, but it isn’t nearly enough to make up for all that the victims and their loved ones have suffered,” said Kristen Johnson, Lead Counsel for the Plaintiffs’ Steering Committee. “The Plaintiffs’ Steering Committee is committed to maximizing victims’ recovery from the many others that contributed to their injuries and minimizing the costs that reduce the amount of money that actually makes its way into victims’ pockets.”

The settlement involves NECC, NECC’s owners, related companies and insurers. The settlement is pending approval from the bankruptcy court. Given the timing of the settlement, it is possible that victims could receive compensation as early as next year.

“The job that we are duty bound to complete is far from over. We will continue with our efforts to hold other wrongdoers accountable, including companies like UniFirst, who was responsible for controlling contamination,” Mark Zamora, a member of the Plaintiffs’ Steering Committee said.

“We are hopeful that other national defendants currently engaged in the mediation program, including the designer and installer of the cleanroom and HVAC systems, will follow suit here and resolve their share of liability to increase compensation to the victims,” said Kim Dougherty, another Plaintiffs’ Steering Committee member.

Plaintiffs’ Steering Committee member Ben Gastel said, “Hopefully the settlement is approved soon, so that victims can get the money they need quickly. In the meantime, we will continue to vigorously litigate against the hospitals, clinics and doctors that put profits over patient safety, including the St. Thomas entities in Nashville, Tenn.”

The terms of the settlement includes personal contributions of almost $50 million from NECC owners Barry Cadden, Lisa Cadden, Carla Conigliaro and Greg Conigliaro. According to the settlement, insiders will also assign 90 percent of their expected tax refunds, which the insiders estimate will amount to an additional $20 million contribution.

Ameridose, the insurers for NECC and a related company, Pharmacists Mutual and Maxum, are contributing more than $25 million. Other insurers, including Lloyd’s of London and Ironshores, have not contributed to the settlement.

An additional contribution will be made if and when the sale of Ameridose is completed, estimated to be valued at about $10 million.

Following the outbreak, hundreds of lawsuits were filed, alleging that NECC and affiliated companies ignored safety procedures in their facilities, resulting in the tainted injections. The company filed for bankruptcy in December of 2012.

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Hagens Berman Sobol Shapiro LLP is a consumer-rights class-action law firm with offices in nine cities. The firm has been named to the National Law Journal’s Plaintiffs’ Hot List seven times. More about the law firm and its successes can be found at www.hbsslaw.com. Follow the firm for updates and news at @ClassActionLaw.

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Ashley Klann
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