Inside Looking Out

Alan Modlinger discusses Merck’s approach to working with outside counsel to build winning teams and strategies

Alan Modlinger knows the dynamics that go into making successful in-house and outside counsel teams; he’s been on both sides. In private practice at Lowenstein Sandler PC, he handled a wide range of responsibilities for pharmaceutical and other clients, including Merck and its winning defense for In re: Schering-Plough Corp. Intron/Temodar Consumer Class Action. In 2010, Modlinger joined the in-house department at Merck, where he is counsel and director responsible for managing litigation teams, as well as internal counseling, primarily for antitrust matters. He shared how his experience has helped him fill a reliable roster of outside counsel.

Modern Counsel: Have you found distinct differences between your in-house and outside positions?

Alan Modlinger: Lawyers learn early in their careers to digest a lot of information and then communicate it efficiently. In the in-house environment, in addition to presenting the facts concisely, we also must put them into an appropriate business perspective. That can require emphasizing the big picture rather than all the finer details, but it always involves clearly identifying business risks, decision points, and consequences relating to the litigation.

MC: Does Merck’s size and high profile create special legal challenges for the in-house team?

AM: Yes, definitely. Merck has a critical role in contributing to public health. During litigation, there is a risk that scientific concepts and data will be distorted or misconstrued in publicly available litigation documents and media coverage. That can lead to confusion by patients and have problematic implications for public health. So carefully guarding the reputation of the company and its products becomes a critical part of managing litigation.

MC: Are there different challenges for the external teams?

AM: Outside lawyers have to appreciate the complexity of clients’ businesses. For example, while a particular case might focus on what appears to be a simple issue of product packaging, the way the product is packaged might be tied into the safety of the product or how the product is manufactured or regulated. The interplay between those disparate pieces needs to be considered when managing the lawsuit. I should add that because of this complexity, it’s also important for the entire legal team to have substantial in-person interactions. Technology makes it possible to accomplish a great deal virtually, but there’s no substitute for being face-to-face. It’s the best way to build the trust and mastery of both a case and the client’s business that’s required to be successful.

MC: Have you found outside counsel have any misconceptions when they start working with your internal team?

AM: They’re often surprised by how actively involved we are. We expect to drive litigation strategy. We push our lawyers to test and retest conceptions, consider alternate approaches, and to think creatively to develop the best case we can. I don’t want rote thinking that doesn’t look beyond what’s been done before. I think some of my strengths are analyzing legal issues and drafting written work product, so I tend to push my outside counsel for their “A+” work in those areas in particular.

MC: Does that ever lead to disagreements with outside teams about strategy or tactics?

AM: I’ve never had an experience in which either side was completely dug in on a particular approach. Communication to try to reach consensus is the key. I have to point out, though, that sometimes it’s actually disagreements that lead to enhancements and refinements that create the best likelihood of a good outcome. And, if you go back to what I mentioned about trust and the importance of the relationship within the team, there may be times when we provide our input and then have to allow counsel to improvise. I’ve routinely been pleasantly surprised when outside counsel has been able to rely on a deft touch and thinking on their feet to get positive results.

Déjà Defense

In 2012, Merck won a groundbreaking case originally brought against Schering-Plough, prior to its merger with Merck. Several years before, class-action suits alleging injury due to alleged off-label marketing were consolidated and then dismissed by the US District Court of New Jersey. Modlinger was part of the Lowenstein Sandler PC team that won that dismissal. By the time of plaintiffs’ appeal, Modlinger had joined the in-house team at Merck and managed the outside teams from Lowenstein and Ropes and Gray LLP, which had handled a related criminal investigation.

Modlinger says there were two components to winning the case: demonstrating that the claims these plaintiffs were bringing were much different from claims Schering-Plough had resolved with the government; and clarifying the pleading standards under Bell Atlantic v. Twombly to establish that the plaintiffs had failed to show a specific injury with a sufficient connection to the alleged conduct. Merck accomplished this by creating a “virtual law firm” through which all three teams worked jointly to develop strategy and written work product.

“We created a very cooperative operation,” Modlinger says. “There were never disputes over territory or efforts to prove the superiority of one firm’s approach—just true collaboration to achieve the best possible outcome.”

MC: Do you have any specific best practices you use to ensure you get that kind of productive and cooperative relationship?

AM: There are several. First, although expertise is obviously important, so is being creative and open to a flexible approach. It may be standard practice to file a motion at a particular point in the case, but we also need to ask whether there are other things that could set us up to be in a better position six months or two years from now. The lawyer with the greatest experience might not always be flexible enough to engage in that sort of creative strategic process.

Second, talking in-person is critical. The give-and-take of those discussions addresses details about company objectives, risks, opportunities, and approaches that e-mail just can’t replace. Sometimes it’s as simple as picking up the phone.

Third, I like to be kept up to date on all developments. If there’s ever any question, my rule of thumb is that more is better than less. I don’t need to know about every document we receive from opposing counsel. But if there are significant communications with the other side, research the team is thinking of doing, or new theories, I want to be part of those discussions.

Fourth, I like plenty of lead time in order to delve into issues. I frequently want to see an outline before anything is drafted. I want to see briefs at least several days before filing because they’re often how cases are won and lost. Most teams like having an engaged and responsive client. It makes for better collaboration and provides more guidance on the direction in which they should be going.

MC: Can you give an example of litigation that was successful because of an ideal inside-outside counsel working relationship?

AM: For one putative class action, we created a very effective collaboration between three outside firms. One provided advice for a specific highly regulated area. Another was a top-notch litigation boutique, and the third was a local firm with excellent insight into practices in the particular jurisdiction. It was a situation in which we had the best possible expertise and were able to develop a comprehensive litigation strategy that was in line with regulatory requirements and our business needs. The interplay between all those different strengths ultimately helped us win that matter. The plaintiffs voluntarily dismissed the suit with prejudice.

MC: Looking back over the time you’ve been at Merck, did you have to make any adjustments to shift from outside counsel to an in-house role?

AM: The biggest adjustment was to the rhythm of the workday. In-house, you’re no less busy, but there’s more time spent talking through strategy, getting input from colleagues, and providing advice instead of producing work product. Once I got adjusted to that type of legal practice, I was actually a little surprised by how stimulating and challenging it is. I’m very happy I’ve gotten the opportunity to practice in this setting. Certainly, I sometimes miss the chance to represent a client in the courtroom. There’s something exhilarating about standing in front of a judge and responding on your feet. Making presentations to internal clients and responding to their questions isn’t quite the same experience—but I also have to say that being able to provide on-the-spot advice to a business client who needs guidance is satisfying in a way that I hadn’t fully experienced before I came in-house.