A significant ruling has been made in the ongoing Blue Cross Blue Shield antitrust litigation, with a judge barring the prominent law firm Polsinelli from representing plaintiffs in the high-profile case. This decision is a major setback for the 1,100-lawyer firm, which has been advising clients on how to potentially opt out of a $2.8 billion class-action settlement and pursue independent lawsuits against the insurer.
Chief U.S. District Judge R. David Proctor, who is overseeing the case, ruled that Polsinelli’s involvement in the case created an undeniable ethical conflict of interest. The firm’s attorneys, previously representing Blue Cross Blue Shield of Alabama in the same litigation, were found to have a conflict due to their prior involvement with the insurer.
In his ruling, Judge Proctor emphasized that the firm’s previous representation of Blue Cross was a substantial issue, stating that “lawyers who until recently did substantial work for Blue Cross in this litigation are now at a firm that is taking materially adverse positions against it — in that same litigation.”
Polsinelli’s attorneys did not provide an immediate comment on the decision, and the plaintiffs’ legal team chose not to respond either. Blue Cross Blue Shield had supported the motion to disqualify Polsinelli from the case, arguing that their involvement presented a clear conflict of interest. However, the insurer declined to comment further.
The case itself involves a class action lawsuit filed in 2012, where hospitals and healthcare providers accuse Blue Cross and its affiliates of engaging in anticompetitive behavior by dividing the country into exclusive zones where they agreed not to compete. The plaintiffs claim that this conspiracy led to higher insurance costs and reduced reimbursements. While Blue Cross denies any wrongdoing, the company has agreed to settle the case for $2.8 billion.
An important deadline is approaching in the case, as hospitals and healthcare providers involved in the class action must decide by March whether to participate in the settlement.
Meanwhile, in a twist to the case, attorneys for the plaintiffs had previously raised concerns over Polsinelli’s actions. They claimed that one of the firm’s lawyers had been speaking with clients about the possibility of opting out of the settlement in favor of filing their own lawsuits against Blue Cross, violating ethics rules against conflicts of interest. Polsinelli denied these allegations, arguing that the firm’s actions were appropriate and did not create a conflict of interest because the clients involved were affiliated with non-Alabama Blue Cross companies.
The ruling is a key development in the Blue Cross Blue Shield antitrust litigation, which continues to unfold in the U.S. District Court for the Northern District of Alabama.
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