Insurer to pay $35 million to pharmacist’s victims

Company continues to deny liability, but says settlement is in its best interests

Kansas City, Mo. ? Robert Courtney’s insurance company has agreed to pay $35 million to settle cases brought by victims of the imprisoned pharmacist’s drug dilution scheme.

The settlement by Pharmacists Mutual Insurance Co., of Algona, Iowa, ends litigation that sought to hold the insurer liable for Courtney’s adulteration of cancer medications and other drugs going back to at least 1992.

Bill Self didn’t stomp his feet, shake his fists or do any ranting and raving during Kansas University’s pulsating victory over Michigan State Tuesday night. Not that it would have done any good. “If you look over at me, I’m probably smiling or whatever,” Self, KU’s first-year head basketball coach said of his sideline demeanor. “It doesn’t do any good to yell at them (players) because they can’t hear you anyway.” The decibel level was near an all-time high during a majority of the No. 6-ranked Jayhawks’ 81-74 victory over the No. 3 Spartans — Self’s first big win as Jayhawk coach. “One thing that is different about Allen … you can’t coach during a game,” Self said. “Guys that are great game coaches at Allen … that’s a bunch of baloney. Unless you know sign language, nobody can ever hear you.” The noise generated by 16,300 fans came as music to Self’s ears. “That’s probably as much fun as I’ve had in coaching,” said Self, who worked at Illinois, Tulsa and Oral Roberts the past 10 years. “It was a fun night, the best atmosphere I’ve been a part of.” KU assistant Norm Roberts was just as amazed at KU’s crowd. “I would rank it as the best so far I’ve experienced as far as atmosphere, energy and support. It’s the loudest arena I’ve been in,” said Roberts, who assisted Self at his three prior stops. “The great thing is the knowledge of the fans, when to yell, get loud, bring it up and tone it down. It’s awesome. What the loudness does is brings energy. It brings so much energy it’s hard to communicate with the players.” It’s not a bad problem to have. “I think they hear us fine in the huddle,” Roberts explained. “Coach talking during the game and trying to make a call … we use hand signals and other things. The players know what offense and defense we’ll be in at all times.” Some of KU’s players, of course, are used to incredibly loud crowds at Allen. “The fans were great. They were our sixth man,” noted Wayne Simien, who exploded for a career-high 28 points. “They helped us get off to a good start tonight and take control of the game early.” ¢ Instant credibility: Self liked Tuesday’s victory for many reasons. One might top the list, however. “This is what I hope it does … I hope it gives us credibility with our players that what we do works, which I know it will,” Self said. “Nobody is skeptical, but people want to see, ‘Hey, does it work?’ We won a muddy game. There’s going to be some other times the games are not free flowing. We’ve got to draw confidence in winning those types of games because we’ve not shot the ball consistently yet. “If you don’t shoot it consistently, sometimes you don’t play quite as fast offensively. I think the guys will draw confidence knowing, hey, what we enforce works.” ¢ Turkey day: The Jayhawks were to eat Thanksgiving dinner at Self’s house today, then practice tonight. The Jayhawks next meet TCU at 10 p.m., Monday, in Dallas. ¢ Big Dub’s big game: KU’s players on Tuesday were mighty impressed by the performance of Simien, who had a career-high 28 points off 9-of-12 shooting. He made nine of nine free throws and now has cashed 16 of 16 for the year. “He didn’t surprise me. He’s done that before on a national stage, in big games,” said junior Keith Langford. “We’re going to have to beg him to stay (in college) another year.” In all, 19 NBA scouts watched Simien’s performance, the third-highest number of scouts to watch a KU game. ¢ Conversational: During pregame warm-ups, KU’s Aaron Miles and Keith Langford chatted with Ted Hillary, one of the three officials. Hillary was no stranger. He worked five KU games last season. Official Jim Burr was also a familiar face. Burr worked the Jayhawks’ games against Duke and Arizona State in last year’s NCAA Tournament. ¢ Ironmen: Miles’ 38 minutes tied his previous high. He also logged 38 minutes against Colorado last year. Miles also had two 37-minute games last season. Simien’s 38 minutes were a career high. He played 37 minutes against Cal last year. ¢ Correction: Simien’s 18 first-half points were the most by a Jayhawk in a half since Keith Langford’s 22 in last season’s loss to Arizona at Allen Fieldhouse. It was reported Simien’s 18 were most since Kirk Hinrich’s 18 in the second half against Baylor in 2001.

“Many legal observers gave us little chance of collecting any money from the insurance company,” said attorney Grant Davis, who together with Michael Ketchmark represented many of Courtney’s victims and helped negotiate the settlement.

Pharmacists Mutual had contended its coverage did not extend to criminal conduct. While agreeing to settle, the insurance company continued to deny liability in the settlement agreement.

“It was in the best interest of the company and its 40,000 policyholders to resolve this litigation in light of the inherent uncertainties of complex litigation, the previously unfavorable Missouri court rulings and to avoid substantial legal fees,” said the chief executive of Pharmacists Mutual, Edward T. Berg.

The settlement covers people who can prove they were injured by diluted intravenous or injected drugs they received from Courtney’s Research Medical Tower Pharmacy in Kansas City or his pharmacy in Merriam, Kan.

As part of the agreement, the plaintiffs’ lawyers will receive 40 percent of the settlement, or $14 million in fees and costs.

The settlement brings to more than $115 million the overall amounts recovered on behalf of Courtney’s victims and families since his arrest in August 2001. After legal fees and other costs are deducted, the amounts available to victims come to about $70 million.

Earlier this year, Eli Lilly and Co. and Bristol Myers Squibb Co., the makers of some of the cancer drugs Courtney diluted, paid more than $71 million to settle cases asserting they were negligent in failing to uncover or report Courtney’s scheme. Both companies denied culpability.

Courtney forfeited assets of about $10 million after pleading guilty in February 2002 to charges of misbranding, tampering and adulterating drugs. He was later sentenced to 30 years in prison.

Pharmacists Mutual’s decision to settle came after a judge ordered the insurer to pay post-judgment interest on a huge damage award to Harrisonville resident Georgia Hayes, an ovarian cancer patient who received diluted drugs.

Of the more than 500 lawsuits filed against Courtney, only Hayes’ case, which was filed weeks after Courtney’s arrest, went to trial.

A Jackson County jury ordered Courtney to pay Hayes $225 million in compensatory damages and $2 billion in punitive damages. Senior Jackson County Circuit Judge Lee Wells later reduced the amount to $30.1 million in compensatory damages and $300 million in punitive damages.

Hayes said Tuesday that the case “was never about the money. It was about holding Robert Courtney responsible.”

How the settlement will be administered has not been determined.