Pfizer Case Points to Unexpected Cost

U.S. Chief Justice John Roberts' recusal last week from a case involving Pfizer in which he owns a small amount of stock may have contributed to a Supreme Court deadlock. That deadlock will allow lawsuits over Pfizer’s Rezulin diabetes drug. Roberts didn't take part in the case, and the court split 4-4, leaving Pfizer one vote short of stopping the suits, according to Bloomberg.

"If you're on the industry side, it kills you that Roberts recused himself,'' Mark Herrmann, a product-liability lawyer at Jones Day in Chicago. "That's your fifth vote."

Roberts's recusal, and others this term, have fueled calls for the nine justices to shed their stock holdings and put the money into funds or other investments less likely to create a conflict of interest, according to the Bloomberg news report.

"They ought to be encouraged to dump the whole portfolio,'' Richard Painter, a law professor at the University of Minnesota in Minneapolis, told Bloomberg.

Painter, who was President George W. Bush's chief ethics lawyer and worked on the nominations of Roberts and Justice Samuel Alito, called stock ownership by jurists "a huge problem.''

Five days before the Pfizer deadlock, the court considered the $2.5 billion punitive damage award for the 1989 Exxon Valdez oil spill without Alito, an Exxon Mobil shareholder. The court ruled on shareholder lawsuits with no input from Justice Stephen Breyer, 69, who owned shares of Cisco Systems, the parent of a company involved in the case.