Judge cuts $2.2 billion award for diluted drugs to $330 million

KANSAS CITY, Mo. -- While upholding a jury's verdict for a cancer patient who received drugs diluted by a pharmacist, a judge cut the damages from $2.2 billion to just over $330 million.

Jackson County Circuit Judge Lee Wells ruled Tuesday in the case against Robert Courtney, who faced hundreds of lawsuits over the dilutions at his Research Medical Tower Pharmacy in Kansas City.

A year ago Courtney pleaded guilty in federal court to 20 counts of misbranding, tampering with and adulterating cancer drugs. He was sentenced in October to 30 years in prison, the maximum under his plea agreement, fined $25,000 and ordered to pay $10.4 million in restitution to victims.

The $2.2 billion damage award, second-largest in the nation last year, came in October in the case of Georgia Hayes, a Harrisonville woman who received 27 chemotherapy treatments with drugs diluted by Courtney.

She and others who got diluted drugs sued Courtney, his pharmacy and the companies that made the drugs Courtney diluted, Eli Lilly & Co. and Bristol-Myers Squibb Co.

The lawsuits alleged that Courtney committed intentional wrongdoing and that the drug companies were negligent in failing to prevent his conduct.

The Hayes lawsuit was the first and only case to go to trial. The two pharmaceutical companies settled on the eve of the trial.

While terms of the settlement were not disclosed, The Kansas City Star reported earlier this month that the companies will pay a total of $71 million to hundreds of Courtney's victims. It said arbitrators assessed $48.55 million against Eli Lilly and $23.55 million against Bristol-Myers.

Courtney's attorneys had asked Judge Wells to either strike down the jury's verdict for Hayes, grant a new trial, or reduce the damages.

In a three-page order Tuesday, Wells reduced the punitive damages awarded to Hayes from $2 billion to $300 million and cut her non-economic damages, for pain and suffering, from $225 million to $29.5 million. Left unchanged were the $571,439 of economic damages which include Hayes' medical expenses.

Even reduced, the damage award remains largely symbolic because Courtney has nowhere near that kind of money. Hayes is seeking to recover from his liability insurer, Pharmacists Mutual Insurance Co., whose policies provided coverage of about $71 million over the years they were in effect.

Michael Ketchmark, who represented Hayes, said the reduction was not unexpected and that Hayes would accept it. The judge said that if Hayes refused to accept a new trial would be held to determine punitive damages.

"We're delighted that the court denied Courtney's motion for a new trial and upheld the jury's finding of liability," Ketchmark said. "We understand and respect the court's decision to reduce the amount of punitive damages.

"This case has never been about money. It's been about sending a message."

While the order didn't say why Wells cut the punitive damages, his decision is in line with U.S. Supreme Court rulings.

"The Supreme Court recognizes that punitive damages can't be unlimited and that they must bear a reasonable relationship to whatever actual damages they're being compared to," said John Phillips, a local trial lawyer who was not involved in the Hayes case.

Wells' decision to reduce the non-economic damages was mandated by Missouri law, which caps those damages at $547,000 per occurrence.

Because Wells agreed with Hayes that each of the 27 times she received diluted chemotherapy drugs constituted a separate occurrence, he awarded her $14,769,000 against Courtney and $14,769,000 against his pharmacy.

The largest verdict in the country last year, $28 billion against Philip Morris Inc. in a smoker's liability case in Los Angeles, was later reduced to $28 million.