Biomet Settlement Announced

The start of 2014 has seen some very significant developments in the national Biomet metal-on-metal hip implant litigation. Perhaps the most significant development though is Biomet’s offering, and the court’s acceptance, of a settlement for claimants who have undergone revision surgeries. On February 3, 2014, Judge Miller entered an order approving a settlement and mediation program that applies to all claimants who were implanted with M2a 38 mm and M2a Magnum metal-on-metal hip implants that have undergone revision surgery. The settlement program does not apply to claims of plaintiffs who have not yet undergone revision surgery, although they may be eligible to join the settlement and mediation program if they undergo a revision surgery prior to September 12, 2014, and otherwise meet the settlement criteria. It is estimated that approximately 600 plaintiffs are eligible for this settlement program.

Under this proposed settlement program, Biomet has agreed to pay a gross base award of $200,000 to claimants who suffered a failure of their M2a 38 mm or Magnum hip device which required a revision surgery, provided that the failure was not the result of infection, trauma or something other than a defect in the hip implant. Of note, bilateral revision cases are treated as two separate claims under the settlement and mediation program. The base awards for some claims will be decreased by $10,000 to $37,500 due to the length of time that the Biomet implant was in place as well as the timing of the surgery (with surgeries that occurred after publicity over issues relating to metal-on-metal hip implants in August of 2010 receiving less compensation). This settlement is more favorable than the DePuy ASR Hip Implant Settlement for certain claimants, as there are no deductions based upon the age of the plaintiff, obesity, or smoking history.

Biomet believes some filed revision cases are time-barred based upon the date of revision. Under the terms of the Settlement Agreement, cases in which the Statute of Limitations has expired based upon the date of revision shall have a presumptive value of $20,000. For those cases where there is good cause to challenge an expired statute based upon a particular states discovery rule, claimants shall have the right to mediate those cases. The Master Settlement Agreement also provides for a presumptive $20,000 settlement for the following types of cases:

• Revisions of M2a devices other than the 38 mm and the Magnum
• Devices which failed within 6 months from the initial date of implantation
• Devices which were revised more than 10 years from the date of initial implantation
• M2a devices including 38 and Magnum which were initially implanted during a revision surgery to remove a different hip implant that was previously placed
• Cases where the Plaintiff is deceased prior to the time of settlement from causes unrelated to revision complications.

Claimants, of course, will have a right to opt out and continue litigating their case if they are dissatisfied with the amount of their award under this voluntary program.

The proposed settlement program encompasses a mediation process for those claimants who seek enhanced awards due to significant and extraordinary complications suffered as a result of the revision surgery.  It also permits Biomet to contest cases for good cause where Biomet asserts a device failed for compelling factors other than metal-on-metal wear, such as infection or trauma. Both the enhanced award claims and contested cases may be resolved through mediation under the settlement program. Either side shall have the right to opt out if they are dissatisfied with the mediation process.

It is estimated base awards could be paid as early as October of 2014, although that would require that all releases be signed and health insurer liens resolved. With regard to the cases that participate in the mediation program, Biomet is not required to fund the Settlement Agreement for those cases until more than 67% of those Plaintiffs have accepted their settlements.

Biomet remains unwilling to negotiate on non-revision cases. Judge Miller has created a separate docket for filed non-revision cases, and has entered a stay of those cases. The Settlement Agreement provides for the dismissal of these cases without prejudice (which means that they could be refiled in the future) if no revision surgery occurs before September 12, 2014. There is also a provision that the applicable statutes of limitation for these claims should not be triggered until a revision surgery occurs, which provides some additional legal protection to claimants who have not yet undergone revision surgery. Claimants who are medically unable to undergo a revision surgery are permitted to participate in the mediation program.