A multi-million dollar settlement was reached this week for Lynette Rowe, the lead plaintiff in a landmark class action against manufacturers and distributors of the drug thalidomide.

Thalidomide was used in the 1950s and 1960s to inhibit morning sickness during pregnancy, until it was discovered that the drug caused congenital defects.  Ms Rowe, now aged 50, represents the class of people born with congenital defects in Australia and New Zealand between 1958-1970, whose mothers took thalidomide.  Ms Rowe’s mother took thalidomide during her pregnancy in 1961, and Ms Rowe was born without arms or legs.

Ms Rowe settled with Diageo, which now owns the company that manufactured and distributed thalidomide in Australia.  According to reports, the manufacturer, German chemical firm Grunenthal, did not take part in the settlement and stated that it “will continue to fully defend any litigation brought against it”.

The settlement follows a 2010 payment by Diageo of $50m to 45 people in Australia and New Zealand in relation to mounting costs of care as they were living longer than expected. 

Despite the settlement, the class action will continue, with Ms Rowe as lead plaintiff and both Diageo and Grunenthal as defendants.

The proceedings have been adjourned to next year to allow time for the group members to continue to negotiate with Diageo.  Their lawyers, Slater and Gordon, say that if there are claims they cannot resolve with Diageo – either due to disputes about the settlement amount, or about whether their injuries were related to the use of thalidomide – then the class action will continue, see here.

Diageo says that it has not yet decided whether to cross-claim against Grunenthal for these settlement amounts.

The settlement and ongoing negotiations with other group members will be followed closely by parties to United States proceedings against GlaxoSmithKline, Sanofi-Aventis, Avantor Performance Materials and Grunenthal claiming damages for thalidomide-related injuries.