Feature | Drug Deal: Siegfried & Jensen attorneys landed a huge drug case contract from Utah’s Attorney General. Did their hiring of Mark Shurtleff’s daughter seal the deal? | Cover Story | Salt Lake City | Salt Lake City Weekly

September 24, 2008 News » Cover Story

Feature | Drug Deal: Siegfried & Jensen attorneys landed a huge drug case contract from Utah’s Attorney General. Did their hiring of Mark Shurtleff’s daughter seal the deal? 

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Just Take a Pill
“The bottom line with Zyprexa,” Steele says, “is that it causes excessive and uncontrollable weight gain, sometimes 100 pounds.” Lawyers allege that the weight gain led to diabetes and its hazardous side effects—from blindness to loss of limb function requiring amputation.

These allegations surfaced only 10 years after the drug had been on the market, prescribed to help consumers manage psychotic episodes brought on by mental illness. One of the biggest buyers of Zyprexa was Medicaid, which Steele estimates accounted for 70 percent of the drug’s business by covering prescriptions for many low-income and homeless people who could not pay for them.

Not only was Medicaid buying the drug by the truckload for years, according to documents in the case, the program was also unknowingly paying to treat the drug’s side effects appearing in consumers.

“In the heyday of Zyprexa, say between 2003 and 2005, you’re talking about a drug with about $4 billion worth of sales,” Steele says. “That’s billion with a B.” He was part of the band of attorneys that staged a critical battle against Zyprexa manufacturer Eli Lilly in spring 2008 in Alaska, alleging the company intentionally concealed the drug’s dangerous side effects. Only a few days before the jury was to hear evidence, Alaska settled with Eli Lilly for $15 million. Several attorneys in that case were upset by what they considered a cop-out deal. According to Ed Sniffen, assistant Alaska attorney general, before a jury and under ideal circumstances, the state could have been awarded $200 million from Eli Lilly, rather than settling for a fraction of that amount.

Eli Lilly’s counsel declared the settlement a “good result.” Comparatively, they had a lot of experience on which to base their settlement negotiations. While the Alaska case was the first settlement Eli Lilly had brokered with a state, by 2008, the corporation’s attorneys had already settled approximately 30,000 individual lawsuits from Zyprexa users for a total $1.2 billion.

But for those lawyers outside the state disappointed with the Alaska attorney general’s low-ball settlement, redemption would still be at hand. While Alaska was the first state to sue Eli Lilly, it’s certainly not the last, as nine other states have begun litigation against the pharmaceutical giant. Utah is one of them. Steele estimates that if a comparable settlement were made in Utah to that of Alaska’s, it would mean at least $60 million. With that as a minimum and with hundreds of millions at stake if the case goes to jury, Utah could claim a bonanza in class-action damages. And the attorneys of Siegfried & Jensen working the case would get their bite. With a 15 percent contingency fee, Garretson Steele could take at least $9 million from a $60 million payment to the state—more if a jury favored Utah with a major damage award.

Mitch Jensen could not be reached for comment on the issue of what kind of fee-sharing there would be between Siegfried & Jensen and their affiliate, Garretson Steele. Senior S&J partner Steele, however, says no formal agreements have been made yet. “If we ever make any money out of this thing, I guess we’ll figure it out then.”

A Family Affair
A recent e-mail exchange between City Weekly and the Deputy Attorney General Raymond Hintze went like this:

CW: Hey Ray, yeah you guessed it—another follow-up question. Could you tell me why Ambra’s [Shurtleff’s daughter] employment at Siegfried & Jensen was not considered a conflict of interest?

RH: You obviously are starting with the assumption that Attorney General Mark Shurtleff (individually or through his daughter) received some personal benefit or gain as a result of the state entering these contracts. So let’s address that issue. Ambra already had a job with Siegfried & Jensen before the contract was entered so there was no quid pro quo to get her a job. Ambra did not get a bonus, raise, or promotion or any other personal gain from her firm as a result of these contracts. She has since left the firm to have her first child and her relatively short employment ended shortly after this contract was entered. So that witch hunt should be over!!

Just west of Interstate 15, off 5600 South, Siegfried & Jensen’s reception area is oblivious to the bustling freeway outside. Inside, the foyer is furnished with a luxurious, long mahogany coffee table and a tropical fish tank. An ornate glass chandelier hangs above potential clients waiting patiently with accounts of fender-bender whiplash and on-the-job accidents. A receptionist calmly fields phone calls, while directly behind her, paralegals gather around a copy machine and divide up job duties: organizing briefs, making copies and sending out mailings.

As one of the largest personal injury law firms in the state, Siegfried & Jensen has four partners, several different divisions, numerous associate attorneys and as many paralegals whose job is to assist attorneys. In late 2005, Attorney General Mark Shurtleff’s daughter Ambra Gardner, a young paralegal, joined the team. Attorneys say she was a fast learner and kept up with her duties in helping to keep the firm moving forward. It was an excellent starting position, and, even though Gardner had no previous paralegal experience, she handled the job well, sources say. Well enough, sources indicate, to be the paralegal in charge of mass torts. She reported directly to senior partners Joseph Steele and Mitch Jensen.

The mass-torts division had plenty of work for Gardner. On Jan. 7, 2006, Steele landed two major contracts with the state. Steele would become special assistant to the attorney general in Medicaid fraud cases involving the drugs Zyprexa and Vioxx. These contracts brought work to Siegfried & Jensen’s Steele only a few months after Gardner came on as a paralegal.

Hintze, the deputy attorney general who oversaw the contracts, says Gardner received no special treatment. When asked about the top paralegal position Gardner had in the short period she worked at Siegfried & Jensen, Hintze responded in an e-mail:

“I guess others will need to respond about whether there was special treatment that led to Ambra’s position. You’ll need to investigate that with those who made those decisions.”

That would be Steele. “I think she could get a job in any office she cared to get a job at,” he says. Gardner worked at Siegfried & Jensen for less than a year, then left to give birth. “I wish she could come back, but she wants to spend time with her child, from what I know,” Steele says.

Gardner could not be reached for comment.

Senior partner Mitch Jensen recalls Gardner’s work. While she was on his team, the job required mostly clerical work, he says.

“The paralegal duties with mass torts mostly involved obtaining medical records and forwarding them onto co-counsel,” Jensen says, adding that “part of her dissatisfaction with the job is there wasn’t room for growth.” The job may not have had potential, but Jensen concedes the attorney general’s daughter likely assisted Steele with the Zyprexa and Vioxx work.

“She may have been organizing files and helping [Steele] with communication and that kind of stuff,” Jensen says. “But she wouldn’t have played a substantial role in the state’s litigation.”

Jensen considers Gardner’s hire a moot issue in relation to the firm landing the state contracts. He does not think that several of his firms’ campaign contributions to Shurtleff in the months leading up to the contracts influenced the attorney general’s decision, either.

Since late 2005, Siegfried & Jensen has given $35,000 to Shurtleff. According to campaign disclosure documents, they gave $1,500 in the spring before the contracts were signed while a $3,500 donation came three months before the Zyprexa and Vioxx contracts were inked in January 2006. A $10,000 donation rolled in during October 2006 followed by contributions of $5,000 and $15,000 in August and October of 2007.

“We support a lot of elected officials,” Jensen says. “And [Shurtleff] does a great job.”

Siegfried & Jensen has supported numerous state legislative candidates, but most of the firm’s donations fall between $250 and $500. Between 2005 and 2007—when Siegfried & Jensen donated $35,000 to Shurtleff—they also spread $17,000 among more than a dozen legislative candidates. That amounted to less than half of what they gave solely to Shurtleff’s campaign. State documents show Shurtleff’s Democratic challenger Jean Welch Hill received no donations from Siegfried & Jensen.

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