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March 2011 Archives


The Senate Judiciary Committee today voted 11-7 on party lines to approve the nomination of John "Jack" McConnell for the U.S. District Court, District of Rhode Island. Whether the Motley Rice trial attorney and Democratic contributor ever gets a final confirmation vote on the Senate floor is another matter. (Updated Friday, 9 a.m.: Sen. Lindsay Graham (R-SC) joined the Democrats in supporting McConnell.)

Sen. Charles Grassley (R-IA), the committee's ranking member, read a lengthy and strongly worded statement in opposition to McConnell's nomination. Excerpt:

Mr. McConnell has a view of the law that I believe is outside the mainstream of legal thought. Much of Mr. McConnell's career has been devoted to bringing some of the most controversial mass tort litigation of recent years. He has pursued the manufacturers of asbestos, tobacco, and lead paint, whose actions he believes to be "unjust." In bringing many of these cases, Mr. McConnell has often stretched legal argument beyond its breaking point. An example is the "public nuisance" theory he pursued in the Rhode Island lead paint case. Well-respected attorneys have said Mr. McConnell's theory "just [did not] mesh with centuries of Anglo-American law" and a former attorney general called the lead-paint cases "a lawsuit in search of a legal theory." 

The Rhode Island Supreme Court unanimously ruled against him in State v. Lead Industries Associates, Inc. In a well-reasoned opinion, the court found that there was no set of facts that he could have proven to establish that the defendants were liable in public nuisance.

 


The Senate Judiciary Committee holds a business meeting Thursday that includes a vote on the nomination of John "Jack" McConnell to be U.S. District Court Judge for the District of Rhode Island.

McConnell was one of the leading tobacco lawyers, a top money maker for the Motley Rice firm in Providence and a big Democratic contributor. He later worked with Attorney General (now U.S. Senator) Sheldon Whitehouse to gin up and pursue public nuisance claims against manufacturers of lead-based paint. The contingency fee lawsuit would have brought many more millions to McConnell, but was unanimously rejected by the Rhode Island Supreme Court in 2008.

And that's why he should be a federal judge!

Judicial Watch has pored through McConnell's committee disclosures and found that, if confirmed as a federal judge, he would still be pulling in millions of dollars annually from the tobacco settlement.

As the top litigator at his mega Providence law firm (Motley Rice), McConnell has raked in between $2 to $3 million a year since 1999 and will receive between $2.5 and $3.1 million annually through 2024 in “deferred compensation” for work on tobacco litigation.

See also Providence Journal, March 17, "Panel takes up McConnell nomination again." Also on the committee's agenda for a vote is Goodwin Liu, nominated to the Ninth Circuit Court.

UPDATE (1:30 p.m.): There's a North Dakota angle? Of course there is. Say Anything blogger Rob Port wonders if the tobacco settlement money is still driving politics in the state.


Reuters, Tuesday, March 28, "Erin Brockovich pushes for disease cluster law":

(Reuters) - Erin Brockovich, a U.S. consumer health advocate whose life story was the basis for an Academy Award-winning film, urged senators Tuesday to pass a law to document disease clusters in the United States.

Sen. Barbara Boxer (D-CA) called the hearing Tuesday by the Senate Environmental and Public Works Committee, entitled, "Oversight Hearing on Disease Clusters and Environmental Health."

In news coverage, Brockovich was identified as "environmental whistleblower" (Cleveland Plain Dealer), " high wattage environmental advocate" (Raleigh News and Observer) and "consumer advocate" (Northwest Arkansas Newspapers). The Detroit News essayed a  "paralegal-cum-activist."

Reporters might have informed their readers by noting Brockovich's obvious self-interest. She runs Brockovich Research & Consulting, a PR front and source of referrals for assorted trial lawyer operations. As the LAObserved.com website reported in March, 2010, "Where's Erin Brockovich?"

She advises people who believe they’ve been hurt by contamination by getting them connected with public agencies and lawyers, who pay her, says the cover story in this week's L.A. Business Journal.

She also has popped up on TV commercials lately. That’s because she works as a consultant for New York personal injury and mass tort firm Weitz & Luxenberg, partly as a spokeswoman. She has a similar role with an Australian personal injury firm named Shine Lawyers. She also works with, but has not worked as a spokeswoman for, downtown L.A. plaintiffs’ firm Girardi & Keese.

The more you can generate public panic and anecdote-based health complaints, the greater the potential for litigation, the greater potential for Brockovich making big bunches of money.


I'm apparently a "leading advocate for class action reform." An impressive roster of speakers is going to have to sit through my lunchtime talk, which is part of the symposium entitled "The Principles and Politics of Aggregate Litigation: CAFA, PSLRA, and Beyond." The event will be webcast.


Marie Gryphon on Arkansas loser pays

Thursday, MI's Marie Gryphon testified in Little Rock, Arkansas on behalf of a loser-pays bill being considered there.


The bonus program of Carol Chambers, which gives prosecutors more money if they win more trials, seems plainly unethical (though the Denver Post story doesn't get to that issue for several paragraphs), but doesn't differ that much from having attorneys general delegate litigation to contingency-fee attorneys.

Around the web, March 28

  • Google Book Search settlement struck down. [WLF]
  • Oklahoma rejects cell phone provider liability for failure to warn for distracted driving. [Jackson]
  • The problems of empirical studies on judicial preemption decisions. [Beck]
  • Many Texas defense attorneys more concerned about tort reform effect on them than on their clients. [law.com/Texas Lawyer]
  • California legislature rejects mild punitive damages reform. [CJAC]
  • Justice at Stake proposes solution to judge-shopping problem caused by Chief Judge Lippman's new disqualification requirements. [LNL; earlier]
  • $60k award reversed for theater telling patrons to turn off cell phones on theory that request was racist. [Volokh]
  • Beware the estate of James Joyce. [Forbes via MR]

WSJ on NVIDIA class action settlement

Tomorrow is the hearing in the argument over enforcement of the NVIDIA settlement. Ronald Barusch covers the dispute over at the WSJ Deal Journal, and the docket is available at the CCAF blog.

When asking the court to disregard objections to the NVIDIA settlement, the settling parties argued that there would be hundreds of thousands of claims worth at least tens (and probably hundreds) of millions of dollars. (Milberg actually argued that there would be "exponentially" more than hundreds of thousands of claims, but I presume that was because they don't know what "exponentially" means rather than because they were arguing that there would be tens of billions of claims.)

But push has come to shove, and only 30 thousand class members have taken the preliminary steps of asking for relief--and the Settling Parties have the gall to argue that this response rate (which will correspond to less than $10 million of class benefit, less than the $13 million attorney fee) demonstrates the popularity of the settlement administration, because one couldn't reasonably expect any more claims than that. We didn't even ask for those numbers: NVIDIA shamelessly volunteered them as evidence of the success of the settlement.

This case is a poster child for why courts should not award attorneys' fees until after the claims period has ended. If we hadn't intervened in this case, no one would have ever disclosed that Milberg exaggerated class recovery twenty- to fifty-fold, and this would be recorded in some empirical study as evidence of attorneys generously restricting themselves to fees of less than 10% of class recovery, rather than 130% of class recovery.


Stephen Moore at The Wall Street Journal reports on the April 5th election for Wisconsin Supreme Court, which organized labor and the political left are trying to turn into a referendum on Gov. Scott Walker's budget and collective bargaining reforms. From Political Diary, "Wisconsin's Battle Supreme":

State supreme court justice elections are typically slam dunks for the incumbent unless there is a scandal or a high-profile court decision that galvanizes opposition. In this case, incumbent David Prosser is caught in the crossfire over collective bargaining issues. Conservatives currently hold a 4-3 majority on the Wisconsin court, but an upset would give liberals the balance of power. Mr. Prosser's opponent, JoAnne Kloppenburg, was a relative unknown and a decided underdog until the protests ignited in Madison. She is now running around that state arguing that Mr. Prosser is a rubber stamp for Governor Walker and his agenda. The liberal groups are up with ads called "Prosser Is Walker."

Union activists and their allies explicitly link Kloppenburg's candidacy to reversing the new collective bargaining law in the Supreme Court. As The Superior Telegram reported, "PeopleFirst rallies behind Kloppenburg," quoting an organizer for the group, Mike Raunio:

Raunio says Kloppenburg could be a vital asset to repealing Scott Walker’s cut to collective bargaining rights.

“She is an ally to the people of Wisconsin. If we help her to get into to position then she will defiantly be an advocate to the rights of workers and everyday citizens.”

Both candidates have accepted public financing limiting their expenditures to $300,000, so outside groups are doing the advertising. Wisconsin Manufacturers and Commerce recently went on the air with a restrained pro-Prosser ad. In a fund-raising appeal to its members, WMC President James Haney wrote, "One union even told its members they want to defeat a Supreme Court justice to 'get even.' It’s shocking and they are putting big money behind their efforts, including boycotts of home-grown Wisconsin employers."

"Whatever Happened to IPOs?"

As the WSJ ($) says, "You don't have to be Sherlock Holmes to figure this one out."

What pro-business bias? (continued)

The Supreme Court rules against business this week in Kasten v. Saint-Gobain and Matrixx Initiatives v. Siracusano. [Blackman; Fisher]

A tale of two police departments

The Department of Justice Civil Rights Division is critical of the New Orleans Police Department and its use of excessive force. Its report (via Sailer) singles out the too-low recruiting standards:

NOPD hired hundreds of officers during a relatively short time period; one estimate is that 400 officers were hired during the three year period following Katrina. In its press to hire these officers, NOPD reportedly lowered its recruiting standards, essentially removing the physical agility requirement and asking the Civil Service Commission to score the written portion of the application less vigorously. ...

In interviews with NOPD officers at all ranks, we heard the consistent complaint that the Training Academy routinely graduated police recruits who were sub-par and not fit for duty.

Meanwhile, in Dayton, Ohio, the Department of Justice Civil Rights Division has successfully demanded that that city's police department lower its recruiting standards, complaining that the existing high standards on the written exam discriminated against African-Americans.


Legislators from Maryland's Eastern Shore continue to be exercised about the University of Maryland Environmental Law Clinic’s active support for a federal lawsuit against a chicken operation that could have major implications for the entire poultry industry in the state. (Update: And nationally. It IS federal court, after all.)

The clinic has aided two groups, Assateague Coastkeeper and the Waterkeeper Alliance, which filed a Clean Water Act citizens complaint in March 2010 in U.S. District Court in Maryland against Hudson Farms and Perdue Farms, Inc. (Assateague news release). The dispute turned into a full-blown controversy when state Senator Lowell Stoltzfuss sought to withhold funds from the Law School in retaliation for its anti-business activities. Editorialists excoriated what they viewed as an attack on academic freedom, but why, after all, should taxpayer funds be used to drive the poultry industry out of business?  We discussed the issue at length in our April 12, 2010, post, “Chicken suit.”

Judge William Nickerson dismissed Assateague Coastkeeper as a plaintiff last July while allowing Robert F. Kennedy’s Waterkeepers Alliance to continue the suit. In its fall newsletter, the Environmental Law Clinic hailed Nickerson’s ruling, “Clinic Wins Key Ruling in Chesapeake Bay Pollution Lawsuit Against Poultry Industry”:

On July 20, 2010, a federal judge gave the Environmental Law Clinic an important victory in its suit charging Perdue Farms Incorporated (“Perdue”) with improper disposal of chicken waste. Judge William M. Nickerson denied Perdue’s claim that it could not be held legally responsible for the waste and refused to dismiss the case. The Clinic’s theory of liability against Perdue focuses on Perdue’s control of concentrated animal feeding operations (CAFO) or “integrator” liability. This is the first case of integrator liability under the Clean Water Act brought in federal court against the poultry industry.

"The Market for Specious Claims"

S. Todd Brown @ SSRN looks at a problem that has been largely ignored outside of the work of Brickman and Nagareda. Abstract:

Few problems are more disruptive to the efficient operation of comprehensive mass tort settlements than over-subscription, which, at times, appears to be fueled primarily by specious claims. In settlements with opt out rights, a flood of claims can generate a market for lemons, with the weakest claims submitting to the settlement and the strongest opting out and seeking recovery at trial or in private settlement. In binding settlements, they may result in a commons problem, requiring dramatic reductions in payment that effectively transfer recoveries from those with intrinsically strong claims to those with weak claims.

This Article evaluates the history of three mass torts where specious claim practices were uncovered and identifies common themes that reflect broader lessons about the potential for over-subscription. In particular, although commentators often focus on the incentives that drive claim recruiting, this Article explains that over-subscription has its origins in claim development incentives, which may be distorted by fixed settlement criteria and encourage practices that lend themselves to specious claim filings. This dynamic is particularly likely to generate specious claim markets for low or negative expected value claims. Moreover, the manner in which this process unfolds presents special difficulties for ethical enforcement and deterrence, suggesting that other mechanisms for controlling specious claim markets may be necessary.


A Reuters story notes that corporations are floating proposals making it easier for shareholders to call special meetings in response to similar shareholder-activist proposals: in an interesting political trick, the board proposals create a 25% threshold of shares rather than the 10% being proposed by activists, thus stealing thunder from activists without making it too easy to call a meeting. MI's Proxy Monitor is quoted.


Last March, two attorneys from the Kabateck Brown Kellner firm published an op ed in the Los Angeles Daily Journal attacking my litigation against impermissible cy pres awards as part of a "corporate" campaign. Never mind that the Center for Class Action Fairness has never taken a dollar of for-profit corporate money. And never mind that my position on cy pres pretty much mirrors that of the American Law Institute. And never mind that Kabateck regularly breaches its fiduciary duty to its clients by regularly negotiating for class money to go to its preferred charities in the first instance rather than as a last resort. We've knocked out one crappy Kabateck cy pres settlement this year that attempted to give the slush fund for charity to the judge if he'd sign off on a settlement that ripped off the class, and we'll knock out a few more in the next twelve months when judges rule on pending cases.

What amuses me today is that same op ed proudly beat its chest: "Another great example of the laudable use of the cy pres mechanism was in the recent Armenian Genocide Insurance Settlements," a class-action shakedown for the benefit of lawyers. Now, the National Law Journal is reporting, there are allegations that settlement funds from that very same case were fraudulently funneled to sham charities. Not the first time. But, of course, the only possible reason to oppose cy pres is to carry water for corporations, right?

(The Center for Class Action Fairness is not affiliated with the Manhattan Institute.)

Walter Olson / Jim Copland podcast

The two discuss Wally's great new book, "Schools for Misrule." [MI podcast]

Bobby Unser vs. the government

Heritage Foundation has a video of an extraordinary case of overcriminalization involving race-car driver Bobby Unser, going well beyond the Great White Defendant antics of a Tom Wolfe novel.

Around the web, March 16

  • Trask on Wal-Mart v. Dukes. [WLF]
  • $90 million Illinois asbestos verdict on a theory of causation ridiculously attenuated even for the sad standard of Illinois asbestos cases. "Owens-Illinois was assessed $40 million in punitive damages and Honeywell International Inc. and Pneumo Abex were assessed $20 million each, even though there were no allegations by the plaintiff in the case that he ever worked for, or was exposed to any asbestos-containing materials made by the three companies." [ILR]
  • California bill would take punitive damage amounts away from California juries. Not clear to me what this accomplishes, other than perhaps removing the interim step of asking the judge to reduce the jury's punitive-damages award. But without a non-economic damages cap of some sort, the result is still effectively uncapped punitive damages. [Cutting]
  • Mississippi Highway Safety Patrol on hook when fleeing criminal kills man in car accident. Of course, if criminals know that the way to have police stop chasing them is to drive recklessly, we'll see more criminals driving recklessly (and escaping and committing more crimes), so it's not clear what tort liability accomplishes here other than punishing innocent taxpayers. [Clarion-Ledger via Torts Prof]

  • Sixth Circuit attempts to reverse Tinker for "racially hostile" speech. Doubtful Supreme Court will concede the issue. [Volokh; Defoe v. Silva; Judge Boggs dissent from denial of rehearing en banc]
  • Trial begins in IJ "blight" eminent domain case in San Diego. []
  • Nobody likes Ted Frank. (Not clear what Facebook accomplishes with this page.) [Facebook]


On April 5, Wisconsin voters will elect a justice to the Wisconsin Supreme Court, choosing between 12-year incumbent David Prosser (campaign website) and Joanne F. Kloppenburg, an assistant attorney general (website). Left-wing activists are supporting Kloppenburg's candidacy as the next stage in the fight over collective bargaining for public employees. Talk about politicizing the judicial elections.

Mickey Kaus, now at The Daily Caller, reports:

Second-Half Game Plan: Firedoglake’s David Dayen on the labor-Dem plans to fight back in Wisconsin after losing their battle with Gov Walker. The most intriguing wrinkle is the scheduled state Supreme Court election:

The matchup between David Prosser (R) and JoAnn Kloppenberg (D) for the state Supreme Court on April 5 just got very interesting. It’s a statewide vote, and the balance of power on the state Supreme Court is at stake.  …. If Democrats win, the legality of what took place tonight [i.e. passing Walker's plan-ed.] may be put in greater question.

Will Wisconsin voters feel comfortable turning a judicial election into, in effect, a referendum on a law Democrats don’t like? Will the other 3 Democratic-appointed Supreme Court judges play along with this slightly banana-republicy game? True, conservatives have often campaigned against liberal judges after unpopular rulings (e.g., Rose Bird in California). But it seems even worse, in terms of legal etiquette, to elect a judge in order to make a particular ruling, about a particular law, in a particular upcoming case. …

Ann Althouse, a University of Wisconsin law professor and top-notch blogger, also reports, "Politicizing the Wisconsin Supreme Court election":

There's an election coming up, and JoAnne Kloppenburg is the challenger to the incumbent David Prosser. There are many Kloppenburg signs at the march and, as I've noted before, although it's supposed to be a nonpartisan election, some people try to make it very political. I've seen many people out at the protests stressing the need to make Kloppenburg a Supreme Court Justice so that she can vote against the GOP budget repair bill and do other things that will help the party that lost the elections last fall get something back in the judicial process.


Texas considering loser pays

A New York Times article on possible loser-pays legislation, unable to determine the actual content of the legislation, still manages to find a defense lawyer, a plaintiffs' lawyer, and a law professor to speak out against the bill, without anyone being asked to make the case for the bill. If a Texas legislator's op-ed on the subject is any clue—"A plaintiff should be required to pay the defendant's legal fees in cases where a court determines that a lawsuit is groundless or where a jury determines a suit is frivolous"—the bill will be pretty weak gruel without an expansion of the definition of "frivolous."

Around the web, March 14

  • What pro-business bias? Supreme Court lets stand appalling $277.5 million securities class action judgment. [LaCroix; earlier]
  • Federal disability enforcement backs off the prospect of "service goats," but ADA overregulation continues. [Olson @ NYPost]
  • Kozinski on overcriminalizing agency costs. [Ribstein @ TOTM]
  • British "super-injunctions" not only bar certain speech, but bar speech about the injunction. [Telegraph via Boing Boing]
  • The Seventh Circuit will enforce the Federal Rules of Appellate Procedure. (But the Drug & Device Law Blog needs to read Howard Bashman's post on linking to Seventh Circuit opinions.) [Beck; Abner v. Scott Memorial Hosp. (Posner, J.)]

Settle now with Round Rock Research!

Round Rock Research, the patent-troll/patent-licensing company owned by former Kirkland & Ellis patent litigator John Desmarais, is auctioning off four "covenants not to sue" on its 4200-patent portfolio March 31. Apple, Nokia, Samsung, and Sony have already purchased licenses. [Litigation Daily ($) via WSJ Law Blog]

One would presume the proceeds will fund litigation against the losers. The only surprise is that more patent litigators haven't acted so entrepreneurially.


Birmingham News: Democratic backers such as trial-lawyer groups have given up on partisan elections for the statewide offices (Republicans hold eight of the nine seats), and are now just trying to hijack Republican primaries, using loopholes in state campaign disclosure laws to avoid revealing their identity until long later. They did succeed in electing Tom Parker to the bench.

DOJ reverses position on amicus briefs

The Department of Justice had asked the Eighth Circuit for a restrictive standard on amicus briefs in the Rubashkin criminal appeal, but backed down and announced withdrawal of its opposition to the amici filings after its unusual position was publicized. [WLF]

Paul Rubin blogging

Important tort-reform scholar Paul Rubin is now blogging at Truth on the Market. His first post remembers Jack Calfee. We're just sorry we didn't get him first, but are happy to hear from other conservative and libertarian law professors and lawyers who want to blog on law and public policy, especially civil-justice-reform issues.

The need for federal anti-SLAPP law

Paul Alan Levy documents how Dan Snyder forum-shopped to find a jurisdiction where he could harass investigative journalists who criticized him without running into anti-SLAPP (Strategic Lawsuit Against Public Participation) law. I have first-hand experience with a wealthy person trying to put himself above criticism through threatening and engaging in expensive meritless litigation, so if Public Citizen wants someone from across the aisle to support Rep. Steve Cohen (D-Tenn.)'s proposed federal bill, they should contact me.

Doctors have recently discovered the use of SLAPP suits: recently-disciplined California cosmetic surgeon Usha Rajagopal has forum-shopped a defamation suit in Virginia; Minnesota neurologist David McKee is suing the family of a patient over at least one statement on a website that he admits in a deposition to be true.


A new, trimmed down version of the Lawsuit Abuse Reduction Act (LARA) was introduced this week, six years after Congress last considered legislation to discourage frivolous lawsuits in federal court.

Rep. Lamar Smith (R-TX),chairman of the House Judiciary Committee, and Sen. Charles Grassley (R-IA), ranking member of the Senate Judiciary Committee, announced the bill's introduction on Wednesday. A news release summarized:

The Lawsuit Abuse Reduction Act (LARA) imposes mandatory sanctions for lawyers who file meritless suits in federal court. Federal rules mandating sanctions for frivolous suits were watered down in 1993, resulting in the current crisis of widespread lawsuit abuse. LARA restores the mandatory sanctions which hold attorneys accountable for lawsuit abuse.

Specifically, the legislation:

  • Reinstates the requirement that if there is a violation of Rule 11, there are sanctions (Rule 11 of the Federal Rules of Civil Procedure was originally intended to deter frivolous lawsuits by sanctioning the offending party).
  • Requires that judges impose monetary sanctions against lawyers who file frivolous lawsuits. Those monetary sanctions will include the attorney's fees and costs incurred by the victim of the frivolous lawsuit.
  • Reverses the 1993 amendments to Rule 11 that allow parties and their attorneys to avoid sanctions for making frivolous claims by withdrawing them within 21 days after a motion for sanctions has been served.

The text of the House bill, H.R. 966, is available here. The Senate bill is S. 533.

Congress last debated LARA in 2005, when H.R. 420 passed the House only to disappear into the Senate. Democrats took control of Congress in the 2006 elections, which put an end to legislative efforts toward tort reform at the federal level.

The new legislation drops the state-specific language that caused political trouble last time and would likely draw the ire of federalism-minded House Republicans. As Victor Schwartz, general counsel for the American Tort Reform Association, tells us, "This new version of LARA has greater political and practical strength. It is trimmer and focuses solely on the problem: stopping frivolous claims. The President of the United States recognized this problem in his State of the Union and Congress should act now to end unnecessary and costly lawsuit abuse."


Around the web, March 10

  • Marvelous exposition by Judge Alsup about factors to consider in evaluating a class action settlement. If all judges were this conscientious, I'd have to shut down the Center for Class Action Fairness for lack of cases. [Trask]
  • Pittsburgh FACTA suit settled for sandwiches and cy pres. Dworken & Bernstein—particularly bad cy pres offenders—gets cash that almost certainly outstrips the relief to the class. [Post-Gazette; Hoxha v. Primanti Bros. Restaurant Corp., No. 10-355 (W.D. Pa.) (h/t J.B.)]
  • Seventh Circuit rejects attempt to sidestep Rule 23(b)(3) in breach-of-contract class action. [Jackson]
  • Add Chic-Fil-A to the list of vendors that sells coffee that can cause third-degree burns, and another data point about how trial lawyers lie about the McDonald's coffee case. [Abnormal Use]
  • West Virginia needs an intermediate appeals court. [Charleston Daily Mail]
  • House considers Regulations from the Executive in Need of Scrutiny ("REINS") Act. [Claeys testimony]
  • Josh Blackman discusses the "Ted Frank rule." [Blackman]

Whelan on Goodwin Liu

Ed Whelan has a page of resources on Ninth Circuit nominee Goodwin Liu. In a new Bench Memos post, Whelan scoffs at Liu's new claim that his philosophy is that "the courts of the United States have a very limited role":

Gee, how'd I miss that in reading his actual book (Keeping Faith with the Constitution) that presents his view on how courts should interpret the Constitution? As I discuss here, Liu's judicial philosophy is indistinguishable from the "living Constitution" approach that he finds convenient to purport to disavow. Indeed, in that book, Liu maintains only that his approach, when "conscientiously applied," "does not give judges unchecked power to determine what society's values are or to impose their own values on society" (p. 28 (emphasis added)). He doesn't assert that his approach, under which judges pick and choose among "multiple sources of wisdom and authority" (p. 29) to "adapt[] [the Constitution's] broad principles to the conditions and challenges faced by successive generations" (p. 2), gives them only a "very limited role." On the contrary, while he calls judicial restraint "an important value," he says that it does not provide "a meaningful guide to constitutional interpretation" and he argues that "[f]aithful application" of the principles he espouses "may sometimes require a robust judicial role" (p. 41). "Sometimes" turns out to be quite often, as his defense in that book of an array of liberal judicial inventions of rights shows that he does not believe in a "very limited role" for the judiciary.

Further, Liu has called for such models of judicial restraint as San Antonio Independent School District v. Rodriguez (education is not a fundamental right subject to strict scrutiny under the Fourteenth Amendment) and Milliken v. Bradley (limiting the availability of interdistrict school desegregation remedies) to be "swept into the dustbin of history." (At his hearing, Liu referred with seeming approval to Rodriguez as "very much informed by principles of judicial restraint," but didn't note that he had called for it to be "swept into the dustbin of history.")

Today, Whelan continues his critique of Liu's testimony.

Anti-reform measure in North Carolina

While the media in North Carolina is focusing on a bill recently passed by the Senate that would cap non-economic damages in malpractice cases, a state legislator who happens to be a highly-compensated medical malpractice lawyer is quietly seeking to change the rules of evidence to let the jury see the highly prejudicial fact (and limits) of insurance coverage without the burden of press coverage letting doctors know that their situation is about to get a lot worse (h/t P.A. and W.O.). Meanwhile, trial lawyers say they plan to challenge the cap on constitutional grounds, demonstrating how reform measures have to get through three branches of government.

Around the web, March 9

What pro-business bias?

So asks Ed Whelan and WLF after a series of unanimous decisions (written, inter alia, by Justices Alito, Scalia, and Roberts) reversing Court of Appeals decisions that had favored corporate respondents.


Judge Lewis Kaplan issued a 131-page opinion detailing the corruption of the Ecuadorian judiciary—as well as the plaintiffs' lawyers plans for evading the parts of Ecuadorian law that prohibit excessive attorneys' fees. Click the tags below for recent posts on the subject. [Fisher @ Forbes]

Update: And Chevron moves to disqualify Steven Donziger's attorney. [LNL]


I'm disappointed, if not terribly surprised. Earlier in November and February.

Interview with the American Lawyer

I'm interviewed in the American Lawyer about the Center for Class Action Fairness (which is not affiliated with the Manhattan Institute).

Around the web, March 7

  • Unintended consequences of Dodd-Frank. [Richard Epstein @ Barron's ($)]
  • Vioxx endgame a feeing frenzy. [WSJ Law Blog]
  • Javelin Marketing threatens meritless SLAPP suits against critics. [Public Citizen]
  • Does Michigan have more truck accidents because it doesn't have punitive damages? Refuting a trial-lawyer canard. [Cutting]
  • Why do newspapers support Snyder v. Phelps but not Citizens United? [Make No Law]
  • Death row inmate wants to donate organs. [NYT]
  • Obama DOMA decision opens up tax can of worms. [Tax Prof]
  • Walter Olson interview on Schools for Misrule. [Daily Caller]


The House Judiciary Subcommittee on the Constitution has a hearing scheduled for Friday, March 11, on the yet to be introduced Lawsuit Abuse Reduction Act, legislation that would amend Rule 11 of the Federal Rules of Civil Procedure to discourage frivolous lawsuits.

The Lawsuit Abuse Reduction Act was one of the high-profile pieces of legislation promoted by civil justice reform activists in the previous decade. Rep. Lamar Smith (R-TX), now chairman of the full Judiciary Committee, was sponsor in 2005 of H.R. 420, which passed the House 228-184 (16 House Democrats voted yes along with the Republicans) before stalling in the Senate.

The primary provision of the 2005 bill applied to the federal courts:

(Sec. 2) Amends Rule 11 of the Federal Rules of Civil Procedure (Signing of Pleadings, Motions, and Other Papers; Representations to Court; Sanctions) to: (1) require courts to impose sanctions on attorneys, law firms, or parties who file frivolous lawsuits (currently, discretionary); (2) disallow the withdrawal or correction of pleadings to avoid Rule 11 sanctions; (3) require courts to award parties prevailing on Rule 11 motions reasonable expenses and attorney's fees, if warranted; and (4) authorize courts to impose Rule 11 sanctions that include reimbursement of a party's reasonable litigation costs in connection with frivolous lawsuits.

However, the bill also sought to apply the new Rule 11 standards to state civil actions involving matters that substantially affected interstate commerce, and it had other provisions directed at state courts. That kind of language raises objections from federalism-minded conservatives (e.g. new "Tea Party" aligned House Republicans), who would otherwise support tort reform.

Accordingly, it's our understanding that the upcoming version of the bill will drop the state-specific language to apply only to the federal courts.



We're past the inflection point, according to this important critique:

Although a fundamental objective of tort liability is to promote safety, the performance of product liability has been more mixed. Safety levels have increased steadily over the past century for reasons wholly apart from tort liability, such as increases in societal wealth and technological progress. Low and moderate levels of liability enhance new product introductions and safety innovations, but high levels of liability have the opposite effect. Similar results are found for new product introductions, patents, and rates of R&D. There is no empirical evidence of a deterrent effect of punitive damages. Jury decision making is hindered by hindsight bias and other cognitive failures, which creates excessive aversion to novel risks associated with innovative products. Jurors' biases against corporate risk analyses discourages systematic analysis of product risks and potentially beneficial new products.


We've extensively discussed this case here, here, and here, as well as its consequences here. Now the defendants in this travesty have filed their appeal brief to the Nevada Supreme Court (3 MB PDF):

Me versus that guy from Law & Order

Former Senator and presidential candidate Fred Thompson is reduced to being a lobbyist for trial lawyers in Tennessee—or it's a sign of how much rent-seeking benefits the trial bar at the expense of the public that they can afford someone so prominent to try to defeat tort reform efforts. The Tennessee Report story extensively quotes me.


At Legal Newsline, John O'Brien reports on two cases about to come before the Mississippi Supreme Court.

One involves the discipline of William Guy and Thomas Brock, two attorneys found by a federal jury to have defrauded Illinois Central Railroad in an asbestos case. (Earlier: March 2010, April 5, February 5.)

The other is a lead-paint case where all sorts of evidentiary and jury-selection shenanigans occurred: a (overly-coached?) witness insisted that he saw cans whose label said "lead paint"—which, if true, would rule out defendant Sherwin-Williams as liable, since it never had such labels. The plaintiff, who allegedly had paint chips in his mouth as a child, calculated his damages on the basis of an alleged need for a 24-hour-a-day "life coach" (though he was able to complete high school, compete in varsity athletics, and drives a car), resulting in a $7 million verdict from a Jefferson County jury that included several friends of the plaintiffs' family.

Jack Calfee's last op-ed

With the assistance of his daughter, the late Jack Calfee's last op-ed makes it into the WSJ ($), and its analysis of MassCare is bad news for Mitt Romney—as well as the rest of the United States if the same flawed problems of the PPACA end up dictating the health economy of the nation.

Others comment on Calfee: David Henderson; Chris DeMuth.


Jeremy Kidd and Todd Zywicki @ SSRN:

Taking as given the claims of tort reform proponents, that increased tort liability in the past few decades has had deleterious effects on American productivity, consumer safety, etc., we consider whether proposed measures to increase access to the courts are likely to be beneficial, with a specific focus on third-party financing and lawyer advertising. We conclude that our current system is a second-best system and, applying the theory of the second-best, we conclude that increasing access would magnify the negative effects of increased tort liability and legal complexity.


If there was ever any question of whether Milberg was going to side with its putative clients or its putative adversary, we now have an answer from this Litigation Daily story ($):

Lead class counsel Jeff Westerman of Milberg said in a statement that Frank is "working against the interests of consumers who deserve to get their computers replaced."

"This settlement is providing class members with repairs and replacement computers, and thousands have already submitted claims," Westerman said in the statement. "When it comes to the replacement computers, we hired an independent expert who confirmed that we were adhering to the terms of the settlement. [Frank's] claims to the contrary reveal an anti-consumer agenda aimed at stopping the settlement from proceeding."

Three obvious points:

1. Millions of HP owners were subject to the settlement; "thousands have already submitted claims." Or, in other words, less than 1% of the class has submitted claims. And that's aside from the fact that "submitting a claim" doesn't indicate approval of the settlement administration, just an understanding that half a loaf is better than none. All of my clients have "submitted claims"; none are happy with the settlement.

2. In case it wasn't clear from my briefs, I fully support "consumers [getting] their computers replaced." One can readily look at my proposed order, and see that I am not trying to "stop[] the settlement from proceeding." There is already an existing court order for the settlement to proceed, and no one has moved to stay that order.

3. I've heard of spin, but it's remarkable that demanding that consumers get what their attorneys promised them in a class action settlement and notice is considered "an anti-consumer agenda." To review: it's the tort reform advocate who has filed papers with the court asking for consumers to get what they were promised; it's the trial lawyers who have announced their intent to file papers with the Court siding with the defendant and alleged wrongdoer insisting that the consumers--their clients--get less than what the Court has already ordered.

Leading tech blog Engadget caught wind of our motion:

Ted Frank of the Center for Class Action Fairness says that NVIDIA has no business passing off cheap laptops, and we think he might have a case -- after all, the judge ordered that NVIDIA provide "a replacement computer of like or similar kind and equal or similar value," and it doesn't take a lawyer to see that the $400 [sic] Compaq Presario CQ56-115DX that the company's offering doesn't come close to compensating owners of faulty machines. We joked that you might be better off selling your old laptop for parts on eBay, and that might not be far from the truth.

(The Center for Class Action Fairness is not affiliated with the Manhattan Institute.)

Around the web, March 1

  • Post-trial decision in Vivendi shareholder class-action applies Morrison to throw out most of the claims. [Trask]
  • Link roundup on Cobell fee-grab attempt. [Overlawyered; earlier]
  • Classmates.com is no more, but they still have a class action to deal with after the settlement was thrown out. [Paid Content; earlier]
  • Cato amicus challenges application of False Marking Statute. [Cato; earlier]
  • Government arguing against allowing amicus briefs in criminal cases. [Torts Prof]
  • Scott Greenfield agrees with me on the poorly-thought-out New York state court conflict-of-interest rules. [Simple Justice; earlier]
  • Texas "Judge Asks to Seal Own Depo in Libel Suit He Filed." [ABAJ]
  • Proto-blogger Mickey Kaus now at the Daily Caller. [Kausfiles]
  • Murder trial of the century, 1806 edition. [HistoryNet]
  • Hey, if it worked for the Huffington Post, we can search-engine optimize, too: Charlie Sheen Charlie Sheen Charlie Sheen says he'll sue CBS! [NY Times]


Walter Olson on the latest Toyota recall. It's worth noting that Toyota has already settled the most famous (and perhaps only) case of a floor-mat-caused acceleration.


They deny it, but NVIDIA marketed a defective chip for use in laptop motherboards that would overheat and damage other components in the laptop. A series of class actions were consolidated in the Northern District of California behind lead counsel Milberg LLP (formerly Milberg Weiss), and settled.

The settlement seemed eminently fair: Apple and Dell laptop owners would get their laptops repaired for free; HP laptops couldn't be repaired, but their owners would get a HP replacement laptop of "like or similar kind and value" (though they weren't more specific than that in the class notice, the settlement papers, or the court filings). NVIDIA set aside hundreds of millions of dollars of charges for the settlement and class counsel got $13 million in fees. There were a handful of professional objectors making boilerplate claims, but if a class member had come to me late last year and asked if I would object to the settlement, I would have told them no.

I've seen class counsel and defendants tacitly collude to rip off class members in a variety of ways in the class action settlement process, but never anything like this: NVIDIA simply ignored what the settlement said, and told every class member that, no matter which of the thousands of configurations of laptop they owned, from the most budget Compaq to the highest-end 17-inch dual-core-processor full-size laptop to $1700 tablet computers with touch screens to sophisticated entertainment centers designed to be hooked up to HDTVs and edit video, all they would get under the settlement was a low-end single-core-processor Compaq CQ-56-115DX, which sold at Best Buy last week for $329.99. Milberg, rather than enforcing their clients' rights, told class members who complained that this is what the judge approved, and generally ignored them. It's not surprising that the response rate is less than 1% so far, with less than two weeks before the claims deadline; NVIDIA would save tens of millions of dollars relative to what they promised in the settlement if no one intervened.

Class members apparently abandoned by their attorneys approached me, and the Center for Class Action Fairness (which is not affiliated with the Manhattan Institute) on Monday filed expedited motion papers asking the Court to enforce the settlement. In my mind, it's so plainly obvious that the settlement is not being followed that the only question remaining is why I was the one who filed these papers with the Court rather than Milberg. I hope we get to find that out. And look at me: the tort reform advocate is a plaintiffs' attorney now. Most of the relevant docket is available at the CCAF site.

 

 


Isaac Gorodetski
Project Manager,
Center for Legal Policy at the
Manhattan Institute
igorodetski@manhattan-institute.org

Katherine Lazarski
Press Officer,
Manhattan Institute
klazarski@manhattan-institute.org

 

Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.