Victims' Attorneys in Pre-Hearing Rift on Trust Funds

By Walter F. Roche Jr.

The lead attorneys for plaintiffs in the civil suit stemming from a deadly outbreak say victims will have to wait even longer for any payments if the judge orders the immediate release of money from a $200 million trust fund.
In a nine-page filing today attorneys Kristen Johnson and Thomas Sobol, representing the plaintiffs steering committee, said the motions filed by lawyers for victims in four states would be "counterproductive" and further delay payments for many months "to most if not all claimants."
The two are asking U.S. District Judge Rya Zobel to reject the move to force the immediate release of funds by a court appointed trustee presiding over a victims' compensation fund.
The open rift between lawyers representing victims of the 2012 fungal meningitis outbreak will play out Tuesday in a hearing in Zobel's Boston, Mass. courtroom. The two sides have also disagreed about whether the Tuesday session should be by phone or in Zobel's courtroom.
Zobel's latest order indicates it will be in the courtroom.
Zobel earlier this week told the lawyers seeking immediate payments that one of them could make a 15 minute presentation during next week's session.
The motions calling for prompt release of the funds came from lawyers representing victims in Virginia, Tennessee, Indiana and Michigan.
Citing the fact that the outbreak is approaching its fourth anniversary, they all argued that victims, at least those that are still alive, deserve relief.
Johnson's brief, however, defends the actions taken by the fund trustee Lynne Riley, including her requirement that claims for reimbursement by the federal government and private insurers be resolved prior to the release of any funds. She said federal law and prior orders set the mandatory standards required  prior to any payments.
She noted that a proposed agreement with the federal government has been approved by one agency but still is under U.S. Justice Department review.
She said many claimants can still expect to get payments by the end of this month "or soon thereafter."
According to her filing, letters are being sent out to those whose claims are not subject to Medicare or Medicaid liens, informing them that they can expect payments as long as they fill out certification forms which will be included in the mailing.
"We acknowledge, however, that most claims remain tied up with the CMS (Centers for Medicare and Medicaid Services) deal," the motion states.
She said those that can expect prompt payment were on a list of 1,199 victims, but she did not disclose the percentage getting payment notices.
The filing does question why CMS has refused to process the claims and provide lien information for victims who have decided to opt out of the so-called global settlement.
"We do not know the basis for CMS' s refusal to process individual claims," the motion states.
The trust fund was created in the bankruptcy of the New England Compounding Center, the company blamed for the outbreak which sickened 778 patients, killing 77 of them.
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