To Our Readers

By John Flanagan

Saturday, October 9, 1999

A case of two

TWO compensation cases in the news this week involved similar amounts, give or take a half-billion. American Home Products agreed to cough up $3.75 billion to settle with thousands of dieters with health problems allegedly caused by the so-called fen-phen diet drug combination. Meanwhile, German firms offered $3.3 billion to compensate surviving Nazi-era slaves and forced laborers.

Under the proposal, each of the 250,000 surviving slaves, about half of them Jewish, would see about $5,500, while 480,000 forced laborers would each get about $2,300.

The dieters -- dare we call them slaves to fashion? -- stand to collect up to $1.5 million each. There are 4,100 suits filed against AHP. If the number of cases doesn't swell, fen-phen sufferers could average about $915,000 apiece.

For news of these two compensation cases to break on the same day was an enormous public relations misfortune for the German companies, which include Allianz, Bayer, Deutsche Bank, Daimler-Chrysler and Volkswagen. The disparities are shocking, to say the least.

Heart valve damage is nothing to make light of, of course, but the money tells a story. AHP's stock actually rose more than $3, or 7 percent, on news of the settlement. Presumably, it clears the cloud of fen-phen liabilities leaving the company free to move on. True, the stock price, at $48, is at a fraction of its 52-week high of $70 a share, but with a market capitalization of $63.6 billion, the settlement is a drop in the bucket.

The seriousness of the fen-phen product liability case is not at issue. What is, however, is the fairness of the German proposal. Compared to the U.S. government program that paid Japanese-American World War II internees $20,000 each, it falls far short. Last year, the Seoul government offered $25,300 in "comfort money" to each of 152 South Korean women who were used as "comfort women" by the Japanese army.

The World Jewish Congress says the offer on the table is too small. They're right.

John Flanagan is editor and publisher of the Star-Bulletin.
To reach him call 525-8612, fax to 523-8509, send
e-mail to or write to
P.O. Box 3080, Honolulu, Hawaii 96802.

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