Jammed asbestos docket derails Shipley PPO fairness hearing

Amelia Flood Jul. 15, 2009, 6:42am




Madison County Circuit Judge Daniel Stack decided a jammed asbestos docket had to take precedence over a fairness hearing in a disputed class action suit against a Preferred Provider Organization (PPO) network.

Although he considered asking another judge to handle it, Stack ultimately reset a fairness hearing in the class action case of Shipley and Coy et. al. v. First Health Insurance Company et. al., after it became clear his Wednesday docket was overloaded. Asbestos lawyers filled Stack's courtroom Wednesday, motions in hand.

Stack's order resetting the hearing was not available Wednesday.

The hearing had originally been held May 26 and was continued to July 15 due to unfinished arguments. The May 26 hearing had lasted just over three hours and Stack called a halt to the arguments due to fatigue.

The case has pitted former law firm members Richard Burke and Robert Schmieder III against one another with First Health attorney Eric Brandfonbrener in between.

At issue is a settlement that would end a 2004 class action suit brought on behalf of chiropractors and other physicians who participated in a PPO network administered by First Health. The suit alleges the participating physicians were cheated out of monies they were owed due to improper claims adjustments.

Schmieder, representing Coy, Shipley and the class, has urged Stack to approve a settlement in the case that would give each class representative $10,000 a piece and $1.25 million to non-profit groups to continue physician education. The Lakin firm would receive $650,000 in legal fees under the proposed settlement.

A plan for disbursing the $1.25 million was submitted to the court. But Burke, a former member of Schmieder's firm – the newly named LakinChapman firm of Wood River – is contesting the settlement's fairness on behalf of a class member, Swansea chiropractor Kathleen Roche.

Roche argues that the settlement agreed to by Schmieder and Brandfonbrener does not financially compensate class members and that it would hamstring a nearly identical suit filed by Roche against First Health in St. Clair County.

Brandfonbrener had echoed many of Schmieder's arguments for accepting the settlement at the May hearing, including the lack of objection from 95 percent of the class members to the settlement.

Burke alleged that he was deceived by First Health when it began settlement talks with his client while concluding similar talks with the Shipley plaintiffs. Brandfonbrener has denied the charge.

The Shipley case is not the first to feature arguments between Burke and his former firm. Burke, of St. Louis, left the Lakin firm in 2007 and has sparred with his former colleagues in several suits.

When first told Wednesday that Stack was going to reset the hearing Brandfonbrener asked if there was any way it could take place at the end of the court day,

"Don't wait around," Stack told him, "unless you want to talk to a catatonic judge."

The judge and attorneys withdrew to Stack's chambers to settle on a time for the next hearing.

The case is Madison case number 04-L-1055.

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