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The Great Waste
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Legal Arena

Day of Reckoning

A Kentucky
court case raises questions
concerning the outcome
of a drug manufacturer’s
trial – and the truth
is looming on the horizon.

By Robert Daniels

EXPOSING THE SECRET SETTLEMENT: Judge John Potter sensed something was amiss.

The story of a drug manufacturer and its calculated manipulation of a jury verdict might appear, at first glance, to be of interest to few beyond the firm’s neighbors and customers.

The Joseph Wesbecker case, which began as a lawsuit in a circuit court in Louisville, Kentucky, looked for some time as though it would end right there – a local matter, over and done with. Case not only closed, but welded shut.

A breath of truth, however, escaped after that trial. Today, instead of a shut case, a mounting international firestorm engulfs the matter, with news media across the globe asking searching questions about corporate responsibility, and with the legal and business communities watching intently to determine the extent of the damage to a multibillion-dollar drug maker.

And there are larger questions. And much at stake for the general public.

onsidering the circumstances, things appeared to be going well for Eli Lilly the first week of December 1994.

True, its cash cow, Prozac, a psychiatric drug widely used in the United States and overseas, had come under fire after the deaths of Joseph Wesbecker and eight others on September 14, 1989, at the Standard Gravure printing plant in Louisville, Kentucky – and for tens of thousands of other adverse reactions that included more than 1,000 suicides and at least 700 additional deaths2.

True, the 12 wounded Wesbecker survivors and the families of the dead victims had sued Lilly, charging that its wonder drug had turned the former pressman into a hollow-eyed monster who had stalked the halls of Standard Gravure, pumping four or more bullets into the heads and torsos of many victims. And true, nearly 160 more damages cases waited in the wings, and a slip in the Louisville courtroom could cause the drug maker to “go down the tubes,” in the words of one Lilly executive.

Despite all of that, Lilly attorneys were optimistic, confident, even buoyant. They were on the verge of what they had come for, and had been willing and able to do virtually anything to get: A jury verdict which said Prozac was “safe” and “effective.”

As sources have informed Freedom, “anything” included a pre-verdict settlement of millions of dollars, paid to the plaintiffs without the knowledge of the judge or the jury.

Setting the Stage

The Lilly legal team had gone through 10 weeks of a hard-fought trial and had managed to stave off plaintiffs’ efforts to present evidence to the jury regarding Oraflex, an “under-tested” Lilly drug that had killed an estimated 72 people in the 1980s by causing liver damage – and for which Lilly had pleaded guilty to 25 counts of criminal conduct in federal court. They had also kept under wraps how, in the United Kingdom alone, more than 1,500 complaints had been lodged regarding Oraflex – claims which even today are being settled for cash, with one source estimating that more than $60 million has been paid to Oraflex victims.

They had also whitewashed the mountains of documentation regarding Prozac’s harmful effects – attributing information obtained from scientific studies, innumerable case histories and government reports to a “disinformation campaign” by members of the Church of Scientology associated with the Citizens Commission on Human Rights.

Lilly’s lawyers had, over the course of the trial, painted a picture of a company which assiduously tested its drugs for safety and efficacy. As the case headed for the jury, the stage had been carefully set, presenting Lilly and its showcase drug in the kindest of all possible lights.

According to one source, Lilly viewed this as a chance to “manipulate public opinion” on a major scale and to thrust aside all questions of Prozac’s safety. A decision by a jury that Prozac was “safe” would silence critics and cut the legs off a swarm of other pending litigants.


But on December 6, the carefully prepared setting rumbled and shook after a Lilly expert, psychiatrist Robert Granacher, testified about the drug maker’s “faultless” research.

A lengthy and heated conference in Circuit Court Judge John W. Potter’s chambers ensued. Plaintiffs’ lawyers argued that Lilly had time and again presented its side of the story regarding how thorough its research was. Now it was time, they argued, for the truth. The plaintiffs pressed to tell the jury about the woefully inadequate testing of Oraflex.

The next day, the judge granted the plaintiffs’ motion to present their Oraflex evidence. If ever there had been a dramatic turnabout in a case, this was it. The moment Lilly’s lawyers had fought 10 weeks to avoid stared them in the face.

And if Oraflex came out, then the door might also open to testimony about other lethal Lilly substances: Darvon, linked to up to 4,000 deaths in one year alone; DES, an artificial hormone now banned for use by pregnant women after it was found that it caused cancer in babies of mothers who had taken it; LSD, mass produced by Lilly for CIA mind-control experimentation; and even heroin, popularized by Lilly, which once peddled it in pint and gallon containers.

One of Lilly’s lawyers was reported to have said, “We think the prejudice to us from this [Oraflex evidence] is extraordinary and should be kept out of the case.” Lilly feared this so much that it had threatened to move for a mistrial if the Oraflex evidence was admitted.

EMPTY WORDS: That the verdict in the Wesbecker case had been bought did not keep Lilly CEO Randall Tobias from boasting about it.

On that day, both defense and plaintiffs rested their cases, stating they had agreed to submit the case upon the evidence presented.

Smelling a rat, Judge Potter summoned lawyers for both sides to meet with him. The principal attorney for the plaintiffs explained why they had decided not to introduce the Oraflex information: “to facilitate getting this case to the jury as rapidly as possible.”

Nothing tangible could explain the abrupt shift in the plaintiffs’ strategy. The linchpin in their case – hard-won after weeks of bitter struggle – was being thrown away.

As subsequently reported by the Kentucky Supreme Court, Judge Potter asked attorneys for both sides “’whether money had changed hands,’ or words to that effect3.”

“No,” was counsel’s unanimous response.

Stage-Managed Justice

Although Judge Potter did not know it at the time, “Plan B” was in full force, calling for the trial to proceed to closing arguments – desultory at best – and to the jury, with the plaintiffs’ silence purchased to omit any mention of Lilly culpability or Oraflex.

On December 12, 1994, 9 of the 12 jurors found for Lilly in what was instantly trumpeted by the drug maker as a “vindication” of Prozac. A press release issued that same day by the drug maker highlighted the boast of its chairman and CEO, Randall Tobias: “We have proven in a court of law ... that Prozac is safe and effective.”

Judge Potter, however, was troubled by the dramatic about-face during the trial and later by the fact that the plaintiffs failed to appeal the jury’s verdict. In a virtually unprecedented act, Judge Potter filed a motion to change the judgment in the case from not guilty to “dismissed with prejudice as settled.”

The denials that any settlement had occurred or that money had changed hands proved to be lies in July 1995 when Andrew Pointer, one of the 20 Wesbecker victims, was compelled to reveal his income in a divorce settlement. Pointer’s attorney, Cecil Blye, disclosed that Pointer had received a huge payment from Lilly, although no precise amount was named. Blye described it as “A hell of an amount. A tremendous amount. It’s mind-boggling.”

In October 1995, Blye confirmed that payments to Pointer were to be made in installments.

Freedom sources have estimated that the total settlement came to eight figures and that it may have been as high as $30 million.

Buying “justice” in this manner was unprecedented.

On May 23, 1996, the Kentucky Supreme Court, after studying the matter for four months, granted Judge Potter’s request to conduct a hearing to determine whether Lilly and the plaintiffs had misled the court about the pre-verdict agreement.

The Supreme Court stated there had been “a serious lack of candor with the trial court” and that “there may have been deception, bad faith conduct, abuse of judicial process or perhaps even fraud.” The court upheld the right of the trial court “to determine that its judgments are correct and accurately reflect the truth in all respects.”

Judge Potter was tasked with determining the extent of any deception, misconduct, abuse of judicial process or fraud in the original trial.

On September 6, 1996, Judge Potter appointed Kentucky Assistant Attorney General Ann M. Sheadel “to develop and present facts from which the Court can determine the true nature of the settlement of the parties.”

Judge Potter’s original and rather simple request – to amend the record to reflect that the case had been settled, not decided by a jury – has now turned into Eli Lilly’s worst nightmare.

“A Fraud on the Court and the Public”

Hearings are slated to go forward starting in October in Judge Potter’s court and many will be watching, hoping that at last, the whole truth will emerge.

Carolyn Winkler of Texas, whose husband killed himself while on Prozac, is one of them. She has filed a lawsuit against Lilly and the principal attorney for the Wesbecker victims, charging they committed “a fraud on the Kentucky trial court and the public.” There were “no evident constraints of morality or ethics” in the Wesbecker case, she stated in her complaint.

“What will a corporation do to protect a $1.7 billion per year market?” she asked. “Lilly was willing to manipulate the court system, lie to a judge, lie to the media and deceive an entire country, all as a matter of business strategy.”

A British reporter who attended the Wesbecker trial, John Cornwell, reflected, “The scandal is not so much to do with Prozac itself as with Lilly’s apparent disregard for the justice system and the wider community. The purpose of jury verdicts in civil actions is to involve members of the public in the way people should behave toward each other. ... [Lilly’s] secret deal effectively transformed the case into a public relations exercise.”

The secret settlement has not only canceled any benefits Lilly may have reaped in orchestrating a “jury verdict,” but opens the door to even larger damages awards.
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