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Hotbed of lawsuits now draws FBI agents
FAYETTE, Miss. -- This rural corner of southwestern Mississippi has for years attracted lawyers eager to capitalize on juries willing to return multimillion-dollar verdicts. Lately it's been drawing a different clientele: federal agents.
The FBI wants to know how individuals became part of these lawsuits and, perhaps, how juries were picked from an area where many people are kin or acquaintances.
"I don't know if this is a few bad actors who found a crack in the dam or a situation where we've got a serious problem," said Ron Rychlak, associate dean of law at the University of Mississippi. "Some folks are suggesting the latter, and if that's the case ... we could have some dramatic changes."
Much of the attention appears to be focused on Jefferson County -- a poor black county of less than 10,000 residents -- where a jury in 1999 awarded $150 million to five Mississippians who claimed the diet drug fen-phen gave them heart and lung problems. The case was eventually settled with more than 800 other fen-phen cases for a reported $400 million.
Just up Highway 61 in Claiborne County, jurors in 2001 returned a $100 million award against Johnson & Johnson stemming from claims the heartburn drug Propulsid caused heart problems, anxiety attacks and other conditions. A judge later reduced the award to $48.5 million.
No caps until this year
Until just this year, Mississippi had no caps on jury awards, and lawyers often tapped this rural area because of its reputation for hostility toward Big Business. But investigators are now looking into whether more was involved.
At least two drugstores in the area have been subpoenaed by a federal grand jury looking for patient information and possibly forged prescription records.
Investigators from the state Attorney General's office reportedly contacted former jurors who sued the CBS news magazine "60 Minutes" after it aired a segment last November called "Jackpot Justice." That segment featured former Fayette florist Beau Strittman, the recipient of an undisclosed settlement from the makers of the obesity drug Redux, who said juries had "awarded these people this money because they felt as if they were going to get a cut off of it."
U.S. Attorney Dunn Lampton said he would not comment on an ongoing investigation.
Some of the plaintiffs from the fen-phen case accuse their lawyers of lining their wallets at victims' expense. More than a half-dozen lawsuits have been filed against several of the attorneys who went after the drug maker.
The lawyers being sued led the fen-phen litigation -- Michael Gallagher of Houston and Dennis Sweet, Shane Langston, Richard Freese and Richard Schwartz.
Two of the lawsuits allege Schwartz signed up fake clients to increase the lawyer's portion from the settlements. Ben Skipper, Schwartz's lawyer, called the allegations "completely baseless."
A Jackson State University employee, Kenneth Kennedy, claims he referred 70 users of the drugs fen-phen, Propulsid and Rezulin to Sweet for $150,000, plus expenses. Kennedy said he was never paid.
"I never had any contracts, I never promised any money," Sweet said. He said his clients were referred by friends, relatives and advertisements.
Two other alleged "runners" have also sued Sweet. One of them, Willie Anderson, said he was to receive between $1.5 and $4 million for the cases he referred. Anderson, though, dropped the suit a day after filing it in April, saying in an affidavit that he became scared after being contacted by FBI investigators.
Anderson also said the lawsuit contained "inaccuracies" that he didn't specify.
Sweet has called the lawsuits "frivolous" and filed a countersuit against Kennedy. He wants a court order forbidding the plaintiffs' attorney, Kevin D. Muhammad, from filing any more suits against him or the other fen-phen lawyers.
Marvin Muhammad, the spiritual leader for the New Nation of Islam in nearby Lorman and Kevin Muhammad's spokesman, said the issue was justice for people who had been taken advantage by legal professionals.
"When it comes to law and medicine and any of those service fields that is a very small ... circle of knowledgeable people, then it is always a market of let the buyer beware. Everyone who is wearing the title does not necessarily live up to the title they're wearing," Marvin Muhammad said.
Sweet declined to say whether he had been contacted by federal investigators.
Bankston Drug Store, the only pharmacy in Jefferson County, has been named in hundreds of suits since the fen-phen settlements as a way for mass claims to be filed in the county.
Hilda Bankston, the pharmacy's former owner, was subpoenaed earlier this year by the same federal grand jury that indicted Diaz and the others.
Bankston was asked to turn over, along with customers' personal and prescription histories, customer and pharmacy records "that appear to be false or not produced by your company."
In Claiborne County, Daphyne and Mark Van Devender say their Port Gibson drug store was subpoenaed for the same documents. They said that on more than one occasion, an attorney has sent them a copy of a forged prescription record, asking if it was legitimate.
Daphyne Van Devender said her pharmacy will no longer fill prescriptions for customers involved in drug lawsuits and will not fill prescriptions for certain drugs.
"They ask why and I say, 'It's because of these lawsuits,"' she said.
Bankston, whose 58-year-old husband died of a heart attack soon after being named in one of the fen-phen lawsuits, says she continues to be identified in lawsuits even though she sold the business in 2000.
"Pretty soon they're going to have to leave us alone," Bankston said.