AcroMed Collateral Attack (Lloyd v. Cabell Huntington Hospital, Inc., & AcroMed Corporation)

Class Actions — Objections to Proposed Settlements
Docket Number: 
Case Description: 

Melissa Lloyd was a class member as defined in the AcroMed bone screw class action settlement, which defined the class to include all people who were implanted with AcroMed bone screws on or before December 31, 1996. Lloyd had her implant surgery two weeks before that deadline. Notice of the non-opt-out settlement was published in January and February of 1997. Lloyd did not see the notice and, at the time of the notice, her injuries had not yet manifested. After she became injured, Ms. Lloyd filed suit in West Virginia against the hospital at which she had the implant surgery and AcroMed.

AcroMed made a motion in the federal district court in Philadelphia in which the class action proceedings were pending and asked for an order to show cause why Lloyd and her lawyers should not be held in contempt of the order approving the class action settlement, which purported to bar suits by class members against AcroMed. Public Citizen appeared on behalf of Lloyd and her lawyers in the contempt proceeding and argued that the request for contempt was really a request to enjoin the West Virginia proceeding in light of the class action settlement. AcroMed did not disagree, and the court granted our request to brief the issues. In our briefs, we argued that the court in Philadelphia never obtained personal jurisdiction over Ms. Lloyd, because she was not given notice and an opportunity to opt out of the class action settlement and that, therefore, her West Virginia suit could go forward. The district court disagreed, held Lloyd and her lawyers in contempt, and enjoined them from pursuing the suit against AcroMed in the West Virginia court. We appealed to the Third Circuit. Before the appeal was decided, however, Lloyd and AcroMed reached a settlement, under which AcroMed paid Lloyd $200,000—several times more than class members received under the class settlement.