The Pennsylvania Supreme Court has determined that, in litigation pursued by state agencies against a prescription drug manufacturer for alleged improper “off-label” promotions of its product, the defendant lacks standing to challenge the agencies’ use of contingency-fee counsel to prosecute the claims. Pennsylvania v. Janssen Pharmaceutica, Inc., No. J-97-2009 (Pa., decided August 17, 2010). The state’s Office of General Counsel hired a Houston law firm on a contingency fee basis to bring the claims on behalf of two state agencies, the departments of Public Welfare and Aging. The matter was before the state supreme court on its grant of a request for extraordinary relief after the trial court denied the company’s motion to disqualify the state’s contingency-fee law firm.
According to the court, under a plain reading of the Commonwealth Attorneys Act, no party other than a state agency has standing to challenge the authority of the legal representation of the agency. While the defendant contended that the Act did not apply where the challenge is to the constitutional authority of private contingency-fee counsel to represent a state agency, the court found nothing in the statute’s text to support a distinction between a statutory- and constitutional-based challenge. The court noted that even “aside from the legislation, and as a general matter, it is difficult to see how a party-opponent in active litigation with the [state] could be said to have a substantial, direct and immediate interest in the authority or identity of the legal representation the [state] has chosen. This is true in legal matters generally: one’s opponent generally cannot dictate the choice of otherwise professionally qualified counsel.”
While the defendant’s request for extraordinary relief from the state high court was pending, the parties proceeded to trial, and the complaint was dismissed at the close of plaintiff’s liability case for failure to establish a right to relief. The court’s majority did not consider whether this rendered its decision moot, but two concurring justices, who raised the issue, would have considered the substantive issues regardless, given their public importance and because they raised a question capable of repetition yet evading review. A dissenting justice opined that the defendant had standing to raise constitutional claims, “most notably, an assertion that its due process rights have been violated.”