German Lipobay Victims Also Suing in U.S. - German Newspaper - January 15, 2002

German Lipobay Victims Also Suing in U.S., Victims Can Hope for Higher Compensatory Damages than in Germany/ Bayer Expects Dismissal
German Newspaper
January 15, 2002

Translated from German. No. 17 647 Business Der Tagesspiegel Page 19.

BERLIN - The Bayer concern is going to be facing additional million dollar claims by Lipobay victims: Attorneys from Germany and the U.S. announced that they were filing a class action lawsuit by German victims against American Bayer Corp. on Monday. "We will not permit a situation in which Bayer only pays compensation in the U.S.-and in which there are first-class and second-class victims," Munich attorney Michael Witti stated in Berlin on Monday. Achieving compensation for Lipobay patients through the courts in Germany would require "thousands of individual proceedings," according to Witti. According to his own statements, the attorney represents more than 2,000 Lipobay victims in Germany.

The Bayer concern took the cholesterol-reducing medication off the market worldwide last August. It is linked to more than 50 deaths. Large U.S. law firms announced class action lawsuits against the concern immediately after that. Attorney Witti, supported by his American colleague, is now attempting to also assert the rights of German Lipobay victims before a U.S. court. Plaintiffs can probably expect to receive substantially higher compensatory damage payments and pain and suffering payments there than they would in Germany.

Witti justified the class action lawsuit on the grounds that Bayer did not take the cholesterol reducer off the market in a timely manner and did not adequately warn of side effects. His U.S. colleague Moll stated that Lipobay-which is marketed in the U.S. under the name Baycol-was developed and marketed primarily in America by Bayer Corp. Therefore, according to him, it is appropriate to conduct the proceeding in the U.S.

On the other hand, Bayer AG, Leverkusen, is of the opinion that a German court has jurisdiction. "Disputes between German citizens and a German company must be litigated before German courts applying German law," Bayer AG stated on Sunday. Moreover, Bayer contended, the medication was developed for German patients in Germany. The concern is confident that the class action lawsuit by German Lipobay victims would be dismissed.

The first court hearing before the competent District Court in Minnesota will take place in February, according to Witti's statements. In his interview with Tagesspiegel, the attorney stated that it is senseless to believe that the case would be decided in four to six weeks. According to him, it would even be more than optimistic to expect a decision this year. The class action lawsuit in the U.S. will be "significantly more expensive" for Bayer than individual actions in Germany, Witti stated. The attorney expects that Bayer will agree to a settlement. In his view, the only question is the amount that will be agreed upon. "The road will be rough," the attorney said.

Analysts do not expect the new class action lawsuit by non-American victims to have any further effect on the price of Bayer stock. "We continue to assume that the compensatory damages will total one to two billion dollars," said pharmaceutical analyst Michael Vara of Commerzbank. According to him, that sum is already factored into the stock price. The price of Bayer stock had declined by nearly 1.7 percent to EUR 36.55 by Monday afternoon in a weak market environment.

Class action

Attorneys in the U.S. wrest compensatory damages in record amounts by means of class actions. The principle: One or more plaintiffs go before the court in the name of an entire group of victims-who do not even have to know about it. The judgment is nevertheless binding on everyone. No such proceeding exists in Germany-here the victims all have to go before the court individually. That and the prospect of high compensatory damage payments and pain and suffering payments are the reasons why attorney Michael Witti has also filed a class action before a U.S. court on behalf of German Lipobay victims. This is not the first time: Witti previously represented National Socialist forced laborers in the U.S. and won millions. He announced a class action against Siemens following the mountain railway accident in Kaprun.