Chief Justice CASTILLE.
This appeal of the trial court's order denying the motion of appellant Janssen Pharmaceutica, Inc. ("Janssen") to disqualify contingent fee counsel retained by appellee, the Commonwealth's Office of General Counsel ("OGC"), is before this Court on a grant of extraordinary relief pursuant
On January 17, 2008, OGC filed a complaint against Janssen in the Court of Common Pleas of Philadelphia County, raising statutory and common law tort claims related to Risperdal, a prescription antipsychotic medication marketed by Janssen. Although Risperdal had been approved by the Food and Drug Administration ("FDA"), OGC alleged, inter alia, that Janssen improperly marketed and promoted Risperdal for non-FDA approved uses, commonly known as "off-label" uses. OGC contended that the Commonwealth has expended millions of dollars for Risperdal prescriptions through Medicaid and the Pharmaceutical Assistance Contract for the Elderly ("PACE"). In filing the action, OGC was not represented by government-employed lawyers. Instead, OGC retained Bailey Perrin, a private law firm based in Houston, Texas, to prosecute the action on a contingent fee basis.
On June 9, 2008, Janssen filed a motion in the trial court seeking to disqualify Bailey Perrin as OGC's counsel in the litigation. Janssen alleged that, while OGC filed the complaint against Janssen on behalf of the Commonwealth, no attorney from OGC entered an appearance, the complaint was signed by local Philadelphia counsel for Bailey Perrin, and a Bailey Perrin attorney verified the complaint. Janssen contended that the contingent fee agreement restricts OGC's ability to consent to a non-monetary settlement of the Risperdal action because it requires that any settlement include reasonable compensation for Bailey Perrin; contains a provision waiving conflicts of interests arising out of Bailey Perrin representing other states in similar actions that varies from the usual conflict of interest provisions included in contingent fee agreements executed by the Attorney General; and does not provide for OGC's control and management of the litigation as is generally the case with the Attorney General's contingent fee agreements. Janssen argued that the contingent fee agreement violates the separation of powers doctrine by usurping the General Assembly's exclusive spending powers. Finally, Janssen claimed that the
OGC responded that Janssen misrepresented the terms of the contingent fee agreement regarding the scope of OGC's control over the litigation. OGC stated that the agreement relegates Bailey Perrin to advising, counseling and recommending actions to OGC and carrying out OGC's directives to the best of its ability and further provides that Bailey Perrin is directly responsible to OGC on all matters of strategy and tactics. In addition, according to OGC, the agreement provides that, at the time of settlement or judgment, OGC will consult with Bailey Perrin and agree to appropriate legal fees. OGC noted that the agreement provides that Bailey Perrin must advance all costs of litigation and, if there is no recovery, could expend millions of dollars with no remuneration.
Regarding alleged restrictions on the ability to reach a non-monetary settlement, OGC argued that, because the Risperdal complaint seeks monetary damages, the likelihood of an acceptable non-monetary settlement is extremely remote, and Janssen had not proposed any non-monetary settlement. On the issue of the alleged conflict of interest, OGC responded that Janssen failed to point to any such conflict or establish how Bailey Perrin's representation of other states against Janssen presents a conflict. OGC added that the contingent fee agreement does not violate the separation of powers doctrine because any fees paid to Bailey Perrin would issue from Janssen and not from the state treasury. Finally, OGC countered Janssen's due process argument by noting that all of the caselaw on that issue involves criminal matters and the impartiality of judges, not counsel representing a governmental entity.
The Honorable Howland W. Abramson denied the motion to disqualify counsel on December 8, 2008, without filing an opinion or otherwise stating the reasons for denial on the record. Janssen then filed an application for extraordinary relief with this Court, asking this Court to exercise jurisdiction to review the denial of its motion to disqualify. Janssen renewed the arguments it had forwarded below, i.e., that the contingent fee contract restricted OGC's authority to settle the litigation for non-monetary relief, and that the contract did not vest control of the litigation with OGC but rather provided that Bailey Perrin need only consult with OGC; that the process by which Bailey Perrin was retained was irregular because the contingent fee contract was not the subject of competitive bidding or legislative authorization; and that the contract violated the separation of powers doctrine and Janssen's due process rights. Finally, Janssen noted that if OGC prevailed in this litigation, Bailey Perrin would be paid fees of as much as fifteen percent of the actual recovery.
OGC opposed the application for extraordinary relief, arguing that Sections 204 and 501 of the Commonwealth Attorneys Act ("Attorneys Act" or "Act") specifically authorized OGC to hire outside counsel
On June 30, 2009, this Court exercised jurisdiction due to the public importance of the disqualification issue and directed the parties to brief the following four issues:
Commonwealth v. Janssen Pharmaceutical, Inc., 601 Pa. 563, 975 A.2d 1076 (2009). The questions, posing two questions of statutory construction and two questions of constitutional law, are purely legal ones and thus, our scope of review is plenary and our standard of review is de novo. See Spahn v. Zoning Bd. of Adjustment, 602 Pa. 83, 977 A.2d 1132, 1142 (2009); Castellani v. Scranton Times, L.P., 598 Pa. 283, 956 A.2d 937, 943 (2008).
Preliminarily, we note that it has long been the policy of this Court to avoid constitutional questions where a matter can be decided on alternative, non-constitutional grounds. See Commonwealth v. Karetny, 583 Pa. 514, 880 A.2d 505, 518-19 (2005); In re Fiori, 543 Pa. 592, 673 A.2d 905, 909 (1996). Accordingly, we will begin with the first issue under the Attorneys Act, which presents the threshold question of whether Janssen has standing to challenge Bailey Perrin's representation
OGC states that Section 103's mandate clearly precludes Janssen's attack on OGC's choice of counsel. Janssen responds that it has standing to move to disqualify Bailey Perrin because nothing in the Attorneys Act prevents a litigant from challenging OGC's unconstitutional usurpation of the General Assembly's spending powers or from litigating due process claims deriving from the Commonwealth's retention of private contingent fee counsel.
Janssen's statutory arguments are based on the Act's legislative history and also on the text of Section 103. First, viewing Section 103 from a historical perspective, Janssen notes that it was enacted after the 1978 amendment to the Pennsylvania Constitution that provided for the election of the Attorney General rather than executive appointment of that position.
71 P.S. § 732-301(6). It is undisputed that the Attorney General declined to file the Risperdal action against Janssen and that OGC was authorized to do so. Viewed in light of this history, Janssen argues, Section 103's express limitation on standing was intended only to restrict challenges to the division of responsibility between the Attorney General and OGC; in that instance, only a Commonwealth agency has standing to "question the authority" of the legal representation of the agency.
In any event, Janssen argues, it is not challenging Bailey Perrin's statutory "authority" to represent the Commonwealth because it recognizes that OGC has the authority to initiate the action and to hire private counsel to prosecute the matter. Instead, Janssen claims, it seeks disqualification of Bailey Perrin as counsel because the contingent fee arrangement violates constitutional principles of separation of powers and due process. Because Section 103 focuses only on statutory "authority," Janssen argues that Section 103 does not forbid or limit a party's right to assert a violation of constitutional guarantees, via the vehicle of a motion to disqualify contingent fee counsel.
Finally, Janssen claims that Section 103 does not limit Janssen's standing to seek disqualification of Bailey Perrin as counsel because Section 103 applies on its face only to "the legal representation of the agency" where a Commonwealth agency is a party to the action. According to Janssen, the Commonwealth itself is the sole plaintiff in this action, and representation of the Commonwealth is distinct from representation of a Commonwealth agency. Janssen says that the distinction it draws is implicit in the General Assembly's use in Section 204(c) of the language, "[t]he Attorney General shall represent the Commonwealth and all Commonwealth agencies...." Thus, Janssen argues, Section 103's specific limitation on standing to challenge representation of an agency cannot be read, as a matter of basic statutory construction, to impose a similar limitation on standing to challenge representation of the Commonwealth as a whole.
OGC counters that a private litigant lacks standing to usurp the role of elected officials in establishing and carrying out the Commonwealth's policies. OGC argues that Janssen's "lofty rhetoric of separation of powers and due process rights" aside, Janssen's motion to disqualify counsel is nothing more than "an attempt by an alleged corporate malfeasor to avoid the consequences of its wrongdoing by re-debating the policy choices of the Governor, Attorney General, and General Counsel." Br. of Appellee at 11. OGC contends that the policy decisions of whether to pursue a particular avenue of litigation, which attorneys to use in the litigation, and how to compensate the attorneys are properly made by public officials, and not by private parties or the courts.
As to Section 103 specifically, OGC points to the plain language of the statute, which prohibits parties to an action other than a Commonwealth agency from
Preliminarily, we note that Section 103 both confers and prohibits standing: it permits Commonwealth agencies to question the authority of an agency's legal representation, but denies such standing to any other party to an action. The General Assembly has frequently enacted statutes conferring standing on particular individuals or entities in specific situations. See, e.g., 13 Pa.C.S. § 2A531 (lessor and lessee have standing to sue third party whose conduct toward goods subject to lease causes actionable injury to party to lease); 23 Pa.C.S. § 4341 (granting standing to any person caring for child to commence or continue action for child support regardless of whether court order grants that person custody); 23 Pa.C.S. § 4378 (recipient of public assistance has standing to commence action for support for any child for whom recipient claims assistance); 24 P.S. § 13-1311-A (student victim of act of violence involving weapon on school property has standing to seek expulsion of aggressor not expelled by school); 35 P.S. § 780-152 (tenant organization has standing to initiate eviction proceedings for drug-related criminal activity on or in immediate vicinity of leased residential premises). The General Assembly also has adopted legislation denying standing in particular circumstances. See, e.g., 15 Pa.C.S. §§ 517 (corporations generally), 1717 (domestic business corporations), 5717 (domestic non-profit corporations) (limiting standing of different types of corporations' individual directors, board of directors and committees of board to sue board of directors, committees or individual directors). Similarly, the Crimes Code provides that persons charged with certain offenses lack standing to challenge the authority of the Attorney General to institute criminal proceedings anywhere in the Commonwealth. See 18 Pa.C.S. §§ 2716 (weapons of mass destruction), 4107 (deceptive or fraudulent business practices), 4120 (identity theft), 5111 (dealing in proceeds of unlawful activities), 6318 (unlawful contact with minor). Accord 70 P.S. § 1-511
Although Section 103 addresses but one narrow issue of standing to challenge a Commonwealth agency's legal representation, where applicable, the Section is absolute and not subject to a weighing of factors, much less does it purport to incorporate the various factors that guide traditional judicial standing doctrine. See, e.g., In re Hickson, 573 Pa. 127, 821 A.2d 1238 (2003). Thus, it appears that a private party, who otherwise might be able to establish standing to disqualify the Commonwealth agency's counsel under traditional standing doctrine, will not succeed under the terms of the Attorneys Act. We note that Janssen does not dispute the general power of the General Assembly to act to curtail standing in this regard. Rather, Janssen appears to accept the legitimacy of the statute but maintains that the provision should be deemed inapplicable for the various reasons it forwards. Similarly, OGC does not argue that, even if Janssen's motion to disqualify was not barred under Section 103, Janssen lacks standing under traditional standing doctrine to challenge OGC's arrangement with private contingent fee counsel.
In making these observations, we do not suggest that an argument concerning traditional standing doctrine would have merit either way; rather, we seek to make clear that the standing question we are asked to decide is one of statutory interpretation. This Court has frequently passed upon just such questions of statutory standing. See, e.g., Spahn v. Zoning Bd. of Adjustment, 602 Pa. 83, 977 A.2d 1132 (2009) (home rule statute conferring standing on "aggrieved person" did not include taxpayers not detrimentally harmed); Hunt v. Pennsylvania State Police, 603 Pa. 156, 983 A.2d 627 (2009) (statute conferring standing on district attorney to challenge record expungement does not extend to State Police); Hiller v. Fausey, 588 Pa. 342, 904 A.2d 875 (2006) (applying statute limiting standing to seek visitation or custody to grandparents whose child has died); Housing Auth. of County of Chester v. Pennsylvania State Civil Serv. Comm'n, 556 Pa. 621, 730 A.2d 935 (1999) (upholding statute granting standing to Civil Service Commission to enforce veterans' preferences where such standing did not exist under traditional standing doctrine).
In all matters involving statutory interpretation, we follow the dictates of the Statutory Construction Act, 1 Pa.C.S. § 1501 et seq., which provide that the object of interpretation and construction of statutes is to ascertain and effectuate the intention of the General Assembly. See 1 Pa.C.S. §§ 1903(a), 1921(b). The statute's plain language generally provides the best indication of legislative intent. See, e.g., McGrory v. Commonwealth, Dept. of Transp., 591 Pa. 56, 915 A.2d 1155, 1158 (2007); Shiffler, supra; Commonwealth v. Gilmour Manuf. Co., 573 Pa. 143, 822 A.2d 676, 679 (2003); Bowser v. Blom, 569 Pa. 609, 807 A.2d 830, 835 (2002); Pennsylvania Fin. Resp. Assigned Claims Plan v. English, 541 Pa. 424, 664 A.2d 84, 87 (1995) ("Where the words of a statute are clear and free from ambiguity the legislative intent is to be gleaned from those very words."). Only when the words of a statute are not explicit will we resort to other considerations to discern legislative intent. 1 Pa.C.S. § 1921(c). See also McGrory; Canvass of Absentee Ballots of November
We agree with OGC that the language of Section 103 is clear and unambiguous and thus provides a clear indication of the General Assembly's intent. The obvious interpretation of Section 103 is that no party to an action, other than the Commonwealth agency involved in the action itself, may challenge the authority of the agency's legal representation. Looking for the occasion of the Attorneys Act, Janssen has constructed a cogent argument that Section 103 could be read as intending only to preclude parties involved in litigation against the Commonwealth from challenging whether the Attorney General or OGC properly should represent the Commonwealth agency, but does not extend to challenges against outside counsel representing the Commonwealth agency. But, to credit Janssen's extra-textual argument would require a policy and statutory construction analysis of Section 103 that is not fairly invited by the clear and unambiguous statutory language actually employed in the legislation. And, in any event, if we were to indulge in a digression into the purpose of the provision, we note that it is perfectly logical to conclude that the General Assembly fully intended the broad effect of the actual words chosen: i.e., that, in addressing the authority of Commonwealth attorneys, it intended that no party but the affected agency should be heard to complain about so fundamental an executive matter as the identity of the lawyers representing Commonwealth entities.
Equally unavailing is Janssen's argument that this matter involves not a Commonwealth agency as plaintiff, but the Commonwealth itself, and thereby does not trigger Section 103's limitation. As OGC notes, this action in fact was filed on behalf of two Commonwealth agencies, the Department of Public Welfare and the Department of Aging, and thus Janssen's argument fails.
In short, the OGC, on behalf of the Commonwealth and two of its agencies, sued Janssen, retaining Bailey Perrin to prosecute the action. Pursuant to the plain language of Section 103, Janssen, as a party to the action other than the Commonwealth party, cannot be heard to challenge Bailey Perrin's authority to represent the Commonwealth party. Because the statutory language is plain and unambiguous, the alternative construction offered by Janssen must fail.
As explained above, the parties do not advert to traditional standing principles.
In re Adoption of J.E.F., 587 Pa. 650, 902 A.2d 402, 412-13 (2006).
The General Assembly has rendered a legislative judgment that only the Commonwealth party-client has a cognizable basis to question its counsel's authority; non-Commonwealth parties to ongoing litigation, such as Janssen, do not have a legislatively-recognized interest in the identity of the lawyers its party-opponent, the Commonwealth and its agencies, has authorized to represent it in an action. Moreover, aside from the legislation, and as a general matter, it is difficult to see how a party-opponent in active litigation with the Commonwealth could be said to have a substantial, direct and immediate interest in the authority or identity of the legal representation the Commonwealth has chosen. This is true in legal matters generally: one's opponent generally cannot dictate the choice of otherwise professionally qualified counsel.
Furthermore, to the extent that Janssen could be said to have a different interest in the questions it poses, distinguishable from the ordinary taxpayer citizen for example, it should be noted that in fact this legislation has distinguished Janssen's interest in contrary fashion. As a party to an action with a Commonwealth agency, a determination has been made in Section 103 that, at least with respect to the question of agency representation, the party should not be heard to complain. Other interests Janssen identifies, such as economic issues regarding the contingency fee arrangement between OGC and Bailey Perrin, whether such arrangements best serve the common good, the procedure by which the arrangement was made, and whether such arrangements represent an executive infringement
Given our disposition of the standing question, we do not reach the remaining issues accepted for review. The decision of the Court of Common Pleas of Philadelphia County is affirmed. Jurisdiction is relinquished.
Former Justice GREENSPAN did not participate in the decision of this matter.
Justice EAKIN and TODD join the opinion.
Justice BAER files a concurring opinion in which Justice McCAFFERY joins.
Justice SAYLOR files a dissenting opinion.
Justice BAER, concurring.
I join in full the Majority's opinion holding that the plain and unambiguous language of Section 103 of the Attorneys Act, 71 P.S. § 732-103, bars Appellant, Janssen Pharmaceutica, from challenging Appellee, Office of General Counsel's hiring of outside counsel to represent it.
I write separately only to indicate my hesitancy and discomfort with the procedural posture of this case, given that the parties have somehow proceeded to trial and conclusion in the underlying matter. First, it is bothersome to me that the parties have failed to keep this Court apprised of such proceedings, given their success in obtaining from our Court the grant of extraordinary relief to decide this important, and arguably, threshold, legal question. Moreover, I believe that the current procedural posture of the case may make the matter before us moot. Nevertheless, as it is at least plausible that the question before us likely falls into the great-public-importance or capable-of-repetition-yet-evading-review exceptions to the mootness doctrine, given our Court's grant of extraordinary jurisdiction, see Pap's A.M. v. City of Erie, 571 Pa. 375, 812 A.2d 591, 600-01 (2002) (alluding to the great-public-importance exception, particularly in light of a material lack of clarity in governing law); Consumers Educ. and Protective Ass'n v. Nolan, 470 Pa. 372, 368 A.2d 675, 681 (1977) (declining to dismiss a declaratory judgment action on mootness grounds despite the expiration of the term for an administrative commissioner, explaining "we conclude that the [legal issue surrounding such claimant's entitlement to office] presents a question capable of repetition and of sufficient public importance that it ought not to escape appellate review at this time"), and given that no party is asserting mootness at this juncture, I am able to join the Majority's decision on the merits in full.
Justice McCAFFERY joins this concurring opinion.
Justice SAYLOR, dissenting.
I respectfully dissent, as I believe Janssen has standing to raise constitutional claims, most notably, an assertion that its due process rights have been violated.
As the majority recites, Janssen argues that the Commonwealth's contingent-fee arrangement with Bailey Perrin violates
In seeking to disqualify Bailey Perrin, Janssen contends, among other things, that the contingent-fee agreement violates the Due Process Clause of the Fourteenth Amendment.
As applied here, Janssen maintains that the contingent-fee contract violates due process by granting the Commonwealth's counsel a financial stake in the resolution of the action, which constrains its ability to agree to outcome choices with regard to settlement. For example, the contract entered into by Bailey Perrin and the Office of General Counsel expressly precludes any compensation or indemnification of costs if no money is recovered from Janssen, see R.R. 80a, which would incentivize Bailey Perrin to disfavor settlements lacking a monetary component that would nonetheless be in the best interests of the citizens of Pennsylvania. In this regard, one commentator has explained, "Contingency fee lawyers' incentives to maximize monetary settlements are more problematic in parens patriae litigation than in traditional private tort litigation.... For example, when the litigation process reveals that the state's theory of liability is factually weak or incorrect, the public interest would seem to dictate that the state should drop its case rather than waste more social resources on the litigation and potentially secure an unjustified recovery." David Dana, Public Interest and Private Lawyers: Toward a Normative Evaluation of Parens Patriae Litigation by Contingency Fee, 51 DEPAUL L.REV. 315, 325-26 (2001).
Finally, Janssen argues that the concept that the Office of General Counsel maintains tight control of Bailey Perrin is largely illusory, as the contingent-fee contract only dictates a nebulous duty of "consultation." See Contract for Legal Services ¶ 4, reproduced in R.R. 71a. Janssen asserts that this differs qualitatively from ordinary contracts entered into by the government with outside counsel, which "include a detailed provision for the [Office of General Counsel's `Control and Management of the Litigation.'" Motion to Disqualify Plaintiff's Counsel ¶ 12, reproduced in R.R. 64a. Again, Janssen highlights the above-mentioned restriction on the Commonwealth agreeing to non-monetary relief as evidence that the government has voluntarily surrendered at least some of its ordinary ability to control the litigation in the public interest. Cf. County of Santa Clara v. Superior Court, 50 Cal.4th 35, 112 Cal.Rptr.3d 697, 235 P.3d 21 (2010) (holding that, to ensure that public attorneys exercise "real rather than illusory control" over contingent-fee counsel, contingent-fee agreements "must provide: (1) that the public-entity attorneys will retain complete control over the course and conduct of the case; (2) that government attorneys retain a veto power over any decisions made by outside counsel; and (3) that a government attorney with supervisory authority must be personally involved in overseeing the litigation").
In my view, Janssen's allegations, if borne out, are sufficient to give it a substantial, direct, and immediate interest in disqualifying Bailey Perrin and precluding the Commonwealth from pursuing relief through similar contingent-fee contracts with outside counsel. Since Janssen alone stands to incur additional costs due to the contract under which Bailey Perrin was hired, its interest in the relief it seeks is substantial because it surpasses that of citizens generally in procuring obedience to the law.
Accordingly, I would hold that Janssen has standing to raise at least its claim based on the Due Process Clause.
42 Pa.C.S. § 726.
71 P.S. § 732-204(c).
71 P.S. § 732-103.
Bailey Perrin attempts to deflect these criticisms by observing that outside counsel paid on an hourly basis could also abuse their position by inflating their hours. See Brief for Appellee at 54. I find this argument flawed in at least two respects: first, it does not ameliorate the due process concerns identified above; second, although a possibility of overbilling may exist — as indeed it may in purely private litigation — this type of difficulty appears more readily subject to control via well-established criteria for determining reasonableness of hourly fees. See In re LaRocca's Estate, 431 Pa. 542, 546, 246 A.2d 337, 339 (1968). It is also worth noting that the justification for allowing contingent-fee contracts for private plaintiffs lacking the resources to bring a meritorious action is absent when the plaintiff-client is the government.