A key pharmaceutical industry case argued just last week before the Supreme Court ended this morning with a loss for the industry. The Court announced it was divided 4-4 in the case Warner-Lambert v. Kent, a split that resulted from the recusal of Chief Justice John Roberts Jr. that deprived the Court of a ninth vote. According to his financial disclosure form for 2006, Roberts owns between $15,001 and $50,000 in stock in Pfizer, the parent company of Warner-Lambert. The impact of a tie is that the lower court ruling, which went against Warner-Lambert, stands — though it does not create national precedent.
At issue in the case was whether federal law preempts a Michigan statute that allows suits against drug makers when plaintiffs can show the manufacturers deliberately defrauded the Food and Drug Administration. The suit was brought by 27 diabetes patients who claimed they were harmed by Pfizer's drug Rezulin.
How did the Court reach its decision so quickly — just a week after it was argued? By Court tradition, the justices would have discussed and taken an initial vote on the case at its closed conference last Wednesday. If it was a solid 4-4 tie, the justices likely decided it was not worth delaying resolution further. The Court has on its docket for the fall another case, Levine v. Wyeth, which addresses a similar question.
The outcome points up a perennial debate over stock ownership by justices, which was a factor in another key case argued last week, Exxon Shipping v. Baker. We wrote about that recusal issue here. Roberts in the recent past has sold stocks that had caused him to recuse — but only in cases where another justice had also bowed out. In the culture of the Court, or at least in Roberts' view, a seven-member Court appears to be unacceptably small, while eight can be tolerated — even if it causes a 4-4 affirmance, as it did today.
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