The opinion of the court was delivered by: LEWIS KAPLAN, District Judge
PRETRIAL ORDER NO. 230
(Common Benefit Work Fund Procedures)
In Pretrial Order No. 67 (Escrow Account to Fund Any Award for Common
Benefit Work), this Court established procedures for the creation of a
CRIS ("Court Registry Investment System") Account to serve as an escrow
account to fund any award for common benefit work performed in these MDL
proceedings. Pretrial Order No. 128 (Modification of Pretrial Order No.
67) provided for the appointment of a Special Master to manage the CRIS
Account created pursuant to Pretrial Order No. 67. After receiving
comments from the parties, and with the approval of the Court, the
Special Master was to establish procedures for the payment of funds
pursuant to Pretrial Order No. 67 and for the proper verification that
the parties are in compliance with Pretrial Order No. 67. In Pretrial
Order No. 130 (Appointment of Special Master), the Court appointed
Michelle Rosenberg to perform the duties of Special Master as set forth
in Pretrial Order No. 128.
The Special Master, after conferring with the defendants and
representatives of the Plaintiffs' Executive Committee (PEC), has
proposed a procedure for the implementation of Pretrial Orders No. 67 and
128, and the Court finds that procedure to be acceptable. Accordingly, it
ORDERED, that Pretrial Orders No. 67 and 128 are supplemented and shall
implemented as follows:
1. Paragraph 1 of Pretrial Order No. 67, and all of the definitions set
forth therein, are incorporated by reference.
2. The Special Master is to deposit all Escrow Amounts received
pursuant to the Pretrial Orders No. 67 and 128 in the CRIS Account.
3. Except as specifically provided herein, all funds held in the CRIS
Account, including any interest earned thereon, shall be disbursed only
upon the Order of this Court.
4. Any taxes owed on interest earned in the CRIS Account shall be paid
by the Special Master from the common benefit funds on deposit in the
CRIS Account. Neither the defendants, their counsel, nor the PEC shall be
entitled to interest generated from the CRIS Account. This Court imposes
no responsibility upon them for paying taxes on any such interest.
5. The fees and expenses of the Special Master shall be paid from the
CRIS Account upon application to and approval by the Court. Neither the
defendants, their counsel, nor the PEC shall have responsibility for
paying any such fees or expenses.
6. Upon making any Claim Payment in any Federal Rezulin Case or any
Electing State Rezulin Case, each defendant shall fully complete a Tender
of Payment Form. A copy of the Tender of Payment Form approved by the
Court is attached as Exhibit 1. Each defendant who makes a Claim Payment
subject to the terms of Pretrial Order No. 67 shall require that each
claimant/plaintiff or his or her counsel fully complete plaintiff's
portion of the Tender of Payment Form before defendant distributes any
payment of settlement/judgment monies to any claimant/plaintiff or their
counsel. Every claimant/plaintiff's counsel (and their firms) receiving
any portion of a fee from the settlement/judgment must be listed on the
7. At or before the distribution of any Claim Payment, the defendant
forward a cashier's check or wire transfer for the Escrow Amount,
along with a completed copy of the authorized Tender of Payment Form, to
the Special Master. All wire transfers must be pre-approved by the
Special Master in advance.
8. Upon receipt of Escrow Amounts, the Special Master shall immediately
deposit those funds into the CRIS Account and complete the "For Special
Master's Use Only" section of the Tender of Payment Form. The Special
Master shall forward one copy of the completed Tender of Payment Form to
each of the "Remitting Counsel" and the "Opposing Counsel" identified on
the Tender of Payment Form, using envelopes marked "Personal and
Confidential." The Special Master shall not send the Tender of Payment
Form, or disclose any of its contents, to any other person or entity.
9. The Special Master shall maintain copies of the Tender of Payment
Forms and keep records so that in the event that the Court directs a
refund of any CRIS Account funds at any time, the Special Master will be
able to account accurately for and distribute those funds as this Court
10. There shall be no requirement for defendants to complete Tender of
Payment Forms to the extent that defendants have withheld Escrow Amounts
pursuant to Pretrial Order No. 67 but, pursuant to Pretrial Order No.
128, have delayed payment into a CRIS Account until the entry of this
Order. All such sums shall be paid to the Special Master within 30 days
of the entry of this Order, including interest accrued at the same rate
at which it would have accrued in a CRIS account from the date of that
Claim Payment until the date that payment is made to the Special Master.
Defendants shall provide to the Special Master all documentation
requested by her to verify all of the relevant identifying information
relating to each of such Claim Payments, and that all appropriate Escrow
Amounts have been deducted from all Claim Payments subject to Pretrial
Order No. 67. The
Special Master shall certify to the Court and to the PEC that the
appropriate amounts have been deducted and paid into the CRIS Account.
11. Except upon Order of this Court, the Special Master shall not
disclose to anyone the identities of settlingparties, the amount of
settlements, or any other information disclosed to her pursuant to ...