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Clark County, Nevada

In 2007 and 2008, Clark County, Nevada made its first two appearances among the nation’s Judicial Hellholes in this report. Last year, it inched down to the report’s Watch List. But this year, the home to gambling capital Las Vegas has again proven itself to be a prime jurisdiction for jackpot justice with a half-billion dollar verdict against two drug companies in a case where injuries were clearly caused by others.

In developed nations such as the United States, it is commonly understood that reusing needles is an extremely dangerous practice that comes with a high risk of spreading disease. The Desert Shadow Endoscopy Center, however, practiced medicine on the cheap. It did not follow the most basic disinfection techniques and used vials of the anesthetic propofol for multiple colonoscopy or endoscopy procedures.

A record-breaking Clark County District Court verdict in May 2010, however, placed much of the responsibility for a resulting outbreak of Hepatitis C on the drug’s manufacturer and distributor. The court absurdly reasoned that stronger warnings against using syringes on multiple patients would have helped, even as over whelming evidence showed that those running the endoscopy center were motivated by profits to willfully ignore any and all such warnings.

Local health officials blamed the outbreak on nurse anesthetists reusing propofol vials after they had become contaminated by syringes that were reused on patients with Hepatitis C. In fact, health officials shut down the clinic in 2008 for unsanitary practices, including reuse of syringes and vials of medication intended only for single-patient use. The doctor who ran the clinic, Dipak Desai, was criminally indicted by a grand jury, pleaded not guilty to 28 felony charges, and is scheduled to be criminally tried in March 2011. But Dr. Desai and his staff who had performed the plaintiff ’s colonoscopy settled the civil medical malpractice claims against them a few weeks before trial, leaving the deeper-pocketed drug manufacturer and distributor on the hook.

The subsequent verdict included the largest known punitive damages award in Nevada history for a man who contracted Hepatitis C. The court ordered Teva Pharmaceutical Industries to pay $356 million and Baxter Healthcare Services to pay $144 million in punitive damages, plus $3.25 million in compensatory damages to the plaintiff, Henry Chanin, and $1.85 million to his wife. Believe it or not, the couple had sought $1 billion.

The label for propofol clearly states that it is for single patient use only and that aseptic procedures should be used at all times. Despite the blatant misuse of the drug by clinic staff, the court found that by placing it in larger than typically needed vials, the manufacturer effectively encouraged such improper practices.

Peabody Award-winning investigative reporter George Knapp observed that “jurors were never allowed to hear a host of arguments, evidence and experts who would have offered alternative explanations.” Knapp notes that “the presiding judge, Jesse Walsh, was viewed as overtly friendly to the plaintiff ’s attorneys. The fact that those attorneys contributed such a large percentage of Walsh’s campaign war chest is only part of the explanation.” Knapp also notes that the judge’s rulings kept jurors from learning: about the serious misconduct of clinic staff; that the federal Food and Drug Administration had approved the warnings on the vials and would have had to approve changes to those warnings; and of other ways hepatitis could have been spread, effectively stripping the companies of any possible defense.

Local legal observers predicted an astronomical verdict despite the clear responsibility of the clinic, citing the combination of a plaintiff-friendly judge, skillful plaintiffs’ lawyers, and pharmaceutical company defendants. One asked, “Is it really the drug maker’s responsibility to make a bottle that can’t be reused or cross contaminated. That’s like saying it’s the toaster oven manufacturer’s responsibility to make a toaster that doesn’t fit in a bathtub full of water.” Even a legal blogger who typically takes the plaintiffs’ side in cases against drug companies distanced himself from the outcome, describing the case as “a crafty lawyer looking for a deep pocket.”

The $500 million verdict is but the first of many lawsuits brought by patients who contracted Hepatitis C as a result of the clinic’s unsanitary practices. The wronged defendants have appealed. But the initial verdict shows once again that Clark County courts are too often willing to shift liability to defendants with the deepest pockets.