The Shrinking Settlement

Two lawyers represented about 431 clients in a mass-injury suit over a diet drug and negotiated a single $200 million settlement for all of them. Prosecutors said the clients were never told the total or how it was divided; instead each was told the lawyers had negotiated a separate deal and was offered less than his calculated share, and clients who complained were later falsely told their claims had been renegotiated. Clients received about $73.5 million; the two lawyers took over $21 million and nearly $31 million, and $20 million went to a charity the clients were told would be very small. The defence said there was no intent to defraud: they had relied on another lawyer's advice and the approval of the judge overseeing the settlement.