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Environmental Law

DOJ Sues 18 Lawyers, Says $300M PCBs Pact in 2003 Didn’t Include Medicare Reimbursement

Posted Mar 1, 2010 6:51 PM CDT
By Martha Neil

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The Department of Justice has sued 18 lawyers, as well as law firms, manufacturers and insurers, contending that a $300 million settlement agreed to in 2003 in an Alabama environmental case wasn't properly allocated to include reimbursement of Medicare costs for 907 of the 3,500 plaintiffs.

It isn't clear exactly how much money may be at issue in the suit, reports the Associated Press. However, the defendants are contesting liability in court filings, arguing that the claim is too old and lacks specificity.

The suit, which was filed in December in federal court in Birmingham, Ala., concerns the settlement of claims of alleged environmental contamination from a Monsanto Co. plant in Anniston, Ala. It formerly manufactured polychlorinated biphenyls, known as PCBs, for decades prior to 1971.

Attorneys representing lawyers in the case didn't immediately respond to requests by the news agency for comment.

However, Chadbourne & Parke, a New York City-based international law firm that isn't involved in the Medicare dispute and is known for its insurance coverage work on behalf of carriers, says in a client alert that the case is noteworthy.

It provides valuable insight about how the feds plan to enforce a law concerning Medicare secondary payers, the firm tells clients. Apparently, the DOJ plans to seek double the amount at issue for unreimbursed Medicare payments in cases in which the government isn't properly notified that a case has settled, according to the AP.

If the DOJ wins the case, such liability could extend back six years, Chadbourne says.

Earlier, a Monsanto spokesman told reporters when news of the litigation broke in late December that it had no control over distribution of the settlement funds and said, if there is any liability in the case, it should be plaintiffs' attorneys who are held responsible for damages, according to Bloomberg.

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