The lawsuit to abolish the filibuster is frivolous, both on the law—James Fallows manages to do an entire Atlantic story without mentioning "political question" or standing doctrine or asking anyone who might actually know a little bit about constitutional law—and on the facts. Fallows and Common Cause appear unaware that the requirement of a 60-vote majority for cloture is a reform—early Congresses required unanimous consent to end debate in the Senate. And one suspects that Fallows and Common Cause will have a little more love for the filibuster the next time Republicans take the Senate.
August 2012 Archives
There is some good and bad in this N.D. California district court decision by Judge Susan Illston approving a settlement of a claims-made class action over employee classifications of tax-season temporary tax preparers.
On the good side, the court based the attorneys' fees on the amount the class actually received, rather than on the hypothetical amount the class could potentially receive but would never try to. Thus, instead of one third of a hypothetical $35 million, class counsel received about 20% of an actual $19.8 million.
On the bad side, the court failed to apply Bluetooth correctly, considering solely the question of "collusion," and not the issue of self-dealing. H&R Block agreed not to oppose an attorney award of $11,833,666 (one third of $35 million plus $166,000), and was willing to put up a minimum of $23.3 million to settle the case. But there was a kicker providing a reversion of approximately half of denied attorneys' fees to the defendant. The clear-sailing and kicker clauses (together with the unreasonable fee request of 49% of class benefit) are per se evidence of self-dealing; class counsel, Marlin & Saltzman and Diversity Law Group, effectively cost their clients $3.5 million through their insistence on these clauses in the hopes of maximizing their own fee. This is not only a reason to reject a settlement out of hand, it should be a reason to find legal malpractice for breach of fiduciary duty. In the absence of public-interest objectors, however, class counsel looks to get away with it.
I'll have a lot more to say about this case and the problems the $1.05 billion jury verdict illustrates, but, in the absence of information that hasn't been in the press accounts, James Maxeiner's critique of the jury form seems misplaced. Samsung had the power to ask for a "special verdict" form more detailed than the one that went to the jury. As best I can tell, they chose not to do so, and thought it advantageous not to. (It's possible that they did ask for such a form, the judge denied the request, and I missed the press coverage of it, or that the press didn't cover the issue.) Maxeiner worries that this gives the Federal Circuit nothing to review, but that's not so, either. The trial was decided on discovery disputes that resulted in the jury not seeing highly probative Samsung evidence, and that, along with questions of the scope of the patents, will surely be before the Federal Circuit.
NACDL has a page of videos about overcriminalization, featuring prominent people from both sides of the aisle.
Don't miss the comments, especially an insightful one from Roger Clegg regarding the study's timing, on my earlier post about the Daye diversity study. Paul Caron was kind enough to cite to my rebuttal, but blogs like JDJournal blithely repeat the press release with a headline that the study "proves" the benefits of diversity.
One commenter writes: "You assume that LSAT scores or college grades are a predictor of success as a law student, and that success as a law student is a predictor of competence in the practice of law." I don't just assume it. I know it to be a fact. The race is not always to the swift nor the battle always to the strong, but that's where the smart betting man puts his money. As Richard Sander has demonstrated, LSATs do predict law school success; law school success does have predictive value for career success. Not everyone with a perfect LSAT will become a millionaire (some of us will foolishly toil in the think-tank mines and fritter away their skills with other non-profit work), and not every smart attorney was Order of the Coif in a top-six school, but ceteris paribus, law firm hiring attorneys have Bayesian reasons to want graduates with good grades from top law schools.
Now, concededly, there's more than one way to be a success as an attorney. Someone with extraordinary social skills can squeak past the bar exam, and use his social skills to recruit many clients with profitable cases, and then hire other attorneys to do the intellectual heavy lifting; someone else with exceptional charisma and oral communications skills can persuade juries (or threaten to persuade juries) of facts that just aren't so, and use those results to attract clients and negotiate favorable settlements before appeals courts throw out the cases. If you have these rare skills, you have the capacity for far nicer Christmas parties than the average Harvard Law Review editor, and your LSAT is irrelevant—but so is the name on your law school diploma, and thus your relevance to the conversation about opportunity and the need for racial preferences.
Plaintiffs in asymmetrical litigation can often force settlement by threatening to impose large discovery expenses on the defendant. Even in a meritless case, if a judge is willing to approve a low-cost settlement that pays the class counsel, both sides can find it profitable to settle rather than litigate. (Moreover, in a meritorious case, conducting unreasonably broad discovery can be a means to boost lodestar to rationalize larger fees when a court is evaluating a settlement agreement: the discovery is reviewed by low-paid associate attorneys with a highly profitable lodestar billing rate, and the class counsel then uses that figure to rationalize a disproportionate fee at the tail end of the case.)
In Boeynaems v. LA Fitness International, LLC, 2012 WL 3536306 (E.D. Pa. Aug. 16, 2012), the defendant faced onerous supplemental discovery requests after already producing substantial information. As Sean Wajert reports:
Judge Michael Baylson ruled that when class action plaintiffs request "very extensive discovery, compliance with which will be very expensive," plaintiffs typically should share defendant's discovery costs - at least until plaintiffs' certification motion has been filed and decided. ... "If the plaintiffs have confidence in their contention that the Court should certify the class, then the plaintiffs should have no objection to making an investment."
Read the whole thing.
The "conflict mineral" regulations of Dodd-Frank, requiring expensive investigation and disclosure of the sourcing of tin, tantalum, tungsten and gold used in the products of 6,000 publicly traded companies, were approved by a 3-2 vote of the SEC, despite lack of evidence that the benefits of such disclosure outweigh the billions of dollars of burden to American industry—and that cost figure is before the inevitable rent-seeking strike-suit securities litigation over alleged technical violations of disclosure. [WSJ]
The underlying law is foolish. Even if I refuse to buy tungsten from the Congolese because of concerns that the sale will directly fund evildoing, when I buy tungsten from the Chinese instead (who are no human-rights angels), Congolese warlords still indirectly benefit because they can sell their tungsten for more money to other buyers who do not purchase from the Chinese. Moreover, the law has had devastating, if predictable, unintended consequences for innocent Congolese.
We've previously discussed the fishy $0 Fraley v. Facebook settlement that would've paid over $10 million to the attorneys: June 20; July 12; July 31. Friday, the district court rejected preliminary approval of the settlement, relying heavily on the Center for Class Action Fairness's Bluetooth victory, singling out the self-dealing "clear sailing" and kicker provisions of the settlement. Before Bluetooth, similar settlements were routinely rubber-stamped in the Northern District of California. [Online Media Daily; Wired]
Steven Domalewski suffered a freak injury playing Little League baseball when he was struck in the chest by a batted ball, and the family has successfully sued every deep pocket peripherally involved, including the metal bat manufacturer, Little League, and a sporting-good chain. [ESPN]
If there is evidence that the injury was the result of a metal bat rather than the unfortunate timing and placement of where the baseball hit Domalewski, it's absent from the press coverage. The Consumer Product Safety Commission completed a study on this issue and concluded in 2002 that there is no evidence to suggest that non-wood bats pose any greater risk than wood bats; baseball is a hazardous game, and those hazards occur with both wooden and non-wooden bats. [via baseballcoaches.org]
A New York Times story seems drafted from a press release as it implies that billionaire tobacco lawyers are successfully targeting the food industry. While it's true that food manufacturers have been buffeted with dozens of class actions over labeling, plaintiffs' lawyers only successes have been nuisance class action settlements—and even many those have been only partial success. A $2M fee from a hit-and-run lawsuit against Kellogg over Frosted Mini-Wheats was thrown out for settlement irregularities; Center for Class Action Fairness attorneys knocked out over a third of a $1.3M fee in a similar harm-less lawsuit against Kelloggs over Rice Krispies. In the New Jersey edition of the widely derided Nutella class action settlement, CCAF attorneys succeeded in reducing a fee request from $3.7M to $1.1M. (The California judge rubber-stamped the same settlement.) This is profitable, but small potatoes to Big Food and to the billionaire Big Tobacco lawyers who, as Walter Olson points out, aren't really the ones involved in this litigation.
Of course, there's more than one way to skin a cat. If current law doesn't permit gigantic recoveries against food companies, create a law that will. Prop 37 in California is being sold as a disclosure law, but the real purpose is, of course, as Walter OIson argues, to create a new cause of action transferring wealth to the plaintiffs' bar. As a WLF analysis shows, the definition of "natural" is so narrow in the proposition—excluding such things as sliced apples, because apples aren't naturally sliced—that consumers will receive no useful information. As such, it is a repeat of the infamous Prop 65, which led every California establishment to warn of cancer-causing agents regardless of actual level of risk. When everyone discloses a Prop 65 warning, no one is actually warned of anything, because one cannot distinguish between a parking garage and a uranium mine with an asbestos-fiber-spewing machine.
A Corporate Counsel article heavily quoting defense attorney Kristen Polovoy shows a distinct lack of outrage; after all, such lawsuits, she says, suggest that food companies should hire more attorneys to review their marketing materials. That such nonsense is a pure social deadweight loss never enters the equation.
If there is a silver lining in all of this, it is no longer the case, as it was when I wrote about these lawsuits in 2006, that the plaintiffs' bar is selling the litigation as a public-policy measure against obesity. Nor can they: the ludicrous injunctive relief in the Nutella settlement changes the sugary spread's tagline from "An example of a tasty yet balanced breakfast" to "Turn a balanced breakfast into a tasty one." Settlements like that demonstrate the degree to which these lawsuits are simply rent-seeking vehicles.
The Class Action Fairness Act puts limitations on coupon settlements. In In re Online DVD Rental Antitrust Litigation, however, the district court approved a settlement that would pay $5.2 million in cash and $8.9 million in Walmart.com coupons to the class and held CAFA did not apply because the parties called the coupons "gift cards."
Does the Class Action Fairness Act regulate semantics or something more? I argue the latter in a Ninth Circuit opening brief filed today.
The district court also awarded a disproportionate $8.512 million to the attorneys. Our appeal addresses that issue as well.
The Center for Class Action Fairness LLC is not affiliated with the Manhattan Institute.
This is little surprise; the U.S. Supreme Court has already held such laws constitutional. So the partisan challenge to promote voter fraud had to resort to forum shopping, but that effort has also failed. [WaPo; last week at PoL; Applewhite v. Pennsylvania]
The National Law Journal headline is "Research attests to the value of diversity at law schools," and that's certainly how study authors Charles Daye et al. pitch their piece. But they simply demonstrate shoddy science to reach the authors' predetermined conclusions.
The study relied on self-reporting of law students, and found that "Many students reported that they left law school with a deeper understanding of the law as a result of diversity among their classmates." Thus, the authors argue diversity should matter in admissions.
The non sequitur is astonishing. All we conclude is that students think that diversity helps their understanding of the law. In the absence of controls (or even a quantifiable statistic for "understanding of the law"), the most we can conclude is that students want to seem politically correct when talking to interviewers.
Even if we were to accept the conclusions of the paper, the policy conclusions—there's a benefit to race discrimination in the name of diversity—do not follow.
Leave aside the constitutional question whether these unquantifiable diversity benefits survive strict scrutiny. How much diversity is required? If every law school abolished diversity-based race discrimination (so that schools that refused to participate in the race-based race wouldn't lose qualified students to better-ranked law schools that reach down to inflate their non-Asian minority population), would the resulting percentages of non-Asian minorities be sufficient to inculcate students with the benefits of diversity? If so, why need affirmative action at all?
If the argument that diversity is good because of the exposing of students to differing viewpoints, wouldn't students be better off if a law school went out and used affirmative action to recruit a Hasid, a Sri Lankan, a Macedonian, an Argentinian, a Mennonite, a Latvian, a Roma, a Gujarati Hindu, a Tibetan Buddhist, and a North Korean refugee? That surely does much more to increase the number of viewpoints available to students than disregarding African-American LSAT scores in admissions. Many law schools have no Hasidim or Roma or North Korean refugee students whatsoever, and the increase from zero to one surely does more for promoting diverse viewpoints than the twenty-third African-American does.
If law schools really care about diverse viewpoints, shouldn't they be doing more to promote diverse viewpoints in faculty hiring? In particular, it's well known that Federalist Society membership and conservative credentials result in blackballing at many law schools; even the schools with token conservatives are overwhelmingly liberal. Surely to the extent students benefit from diverse viewpoints, they'd especially benefit from diverse political viewpoints from faculty. Perhaps we should have a two-year hiring freeze on non-Federalists until conservatives catch up?
Or is the argument that only African-Americans have the innate qualities that create the positive externality of diversity? I'm waiting for someone to come out and say that, though it seems suspiciously like the Magical Negro stereotype.
"Daye said he hopes the findings will influence admissions officials to continue to consider race as at least a small part of the review process and will help inform the courts struggling with affirmative action challenges." I bet.
Related: Big Business weighs in with an unpersuasive brief in Fisher v. University of Texas. [Clegg @ Bench Memos] One hopes that Jenner & Block wasn't being paid with shareholder money for this buoyant political correctness.
Update: more discussion.
In April, we complained that the Obama administration's push to use "disparate impact" to encourage schools to discipline misbehaving African-American students less often was both undercovered by the media and potentially disastrous to both public schools and the African-American community. In City Journal, Heather Mac Donald has a must-read expanding on this issue, with supporting statistics:
The homicide rate among males between the ages of 14 and 17 is nearly ten times higher for blacks than for whites and Hispanics combined. Such data make no impact on the Obama administration and its orbiting advocates, who apparently believe that the lack of self-control and socialization that results in this disproportionate criminal violence does not manifest itself in classroom comportment as well.
Though the federal government does not collect data on student misbehavior by race, it does survey schools on their discipline problems. During the 2009-10 school year, the rate at which schools that were over 50 percent minority reported gang activity was five times as high as the rate at schools where minorities constituted 5 to 20 percent of the population. More than 11 times as many schools in the first category as in the second reported widespread weekly disorder in classrooms; more than four times as many reported weekly verbal abuse of teachers. The Departments of Education and Justice publish this information in their annual Indicators of School Crime and Safety, but they have not allowed it to contaminate their official position that racial disparities in student discipline reflect racial inequity, not student behavior.
Hans Bader argues that the problem is even worse at the state level, with Maryland proposing actual quotas in discipline. The consequences in integrated schools can be appalling, with actual disparate treatment to prevent disparate impact: one commenter at Joanne Jacobs' blog claims to have had a "difficult month" when a smaller child of a disfavored race was severely beaten by a 6-foot-tall seventh grader of a more widely misbehaving race—and the school only punished the victim to avoid disrupting its statistics. Word "quickly spread that violence against the "under-disciplined" ethnic group was treated as a freebie."
Litigation to prevent this nonsense is very badly needed before we have a lost generation.
See also Overlawyered.
Related: Roger Clegg analyzes an appalling Department of Justice brief in Fisher v. University of Texas defending racial discrimination against Asians. [Bench Memos via Fed Soc, which needs to do a better job of making sure its links work; see also Reuters]
In June 2011, six cattle wandered onto the North Dakota property of Rodney Brossart. Brossart refused to return them to their owner until he had paid Brossart for feed consumed by the cows. North Dakota law permits such "distraint," but, noting that "there have been problems with [him] in the past," the Nelson County Sheriff's Office decided to arrest Brossart. During an armed standoff, the Sheriff took up the offer by the Department of Homeland Security to lend the Sheriff an unmanned Predator drone. When the drone confirmed that Brossart and his family had not left the ranch, and were unarmed, Sheriff's deputies arrested Brossart and four members of his family. The Brossarts moved to dismiss the charges, arguing, inter alia, that use of the drone constituted "outrageous governmental conduct," "unlawful surveillance," and an "illegal search and seizure." North Dakota District Judge Joel Medd denied the motion, writing that "there was no improper use of an unmanned aerial vehicle" and that the drone "appears to have had no bearing on these charges being contested here."
The Brossart case is the first in which a court has approved a domestic law enforcement agency's use of a drone to investigate or arrest a suspect. But it certainly won't be the last. In February of this year, members of Congress backed by the drone industry inserted language in the the FAA reauthorization bill requiring the agency to simplify and accelerate the process for allowing domestic agencies to operate drones. At the same time, the Department of Homeland Security has launched a program to "facilitate and accelerate the adoption" of drones by domestic agencies. The FAA has already authorized dozens of domestic agencies to operate drones, including the police departments of Houston, North Little Rock and Gadsden, Alabama. Other states and localities are lining up for FAA authorization and DHS grant funds. There has even been talk by some local police of adding weapons to domestic drones.
There is no question that drones will make it easier for domestic law enforcement agencies to investigate crimes and arrest suspects. This may make us safer, although the lack of sophisticated onboard collision avoidance systems and the prospect of local sheriffs's deputies piloting drones outfitted with rubber bullets and tear gas engenders some doubt on this point. And the use of domestic drones will certainly provide jobs and profits for drone manufacturers. But as even DHS has recognized, the use of domestic drones raises enormous privacy and Constitutional issues. DHS says "we will not be watching backyards," but as domestic drones proliferate, it will become harder and harder to control what all of the agencies approved to use them are doing with them. The Fourth Amendment guarantees Americans the right "to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures." One wonders what its drafters would say about the use of drones to arrest a family in a dispute over trespassing cows.
A Tumblr complaining about Progressive has gone viral. The author's sister, "Katie," died in a Maryland car accident; the other driver's insurance paid its limits, and Katie's family went to Katie's insurer, Progressive, to seek coverage for the underinsurance of the other driver. Progressive refused, so the family sued the other driver to prove liability, and found themselves adverse to Progressive in court, and the author was furious, as are readers of the story. (A jury found for Katie, so her family will recover from Progressive after all.)
Without more facts, however, it seems Progressive is being viewed unfairly. Maryland is one of the few remaining contributory negligence states: if Katie was 1% at fault in the accident, there is no liability to the other driver or Progressive. As the author himself admits, there was a "possibility that Katie was at fault in the accident." Is Progressive supposed to give money away when they aren't legally obligated to do so? The author says "One indication that the case was pretty open-and-shut was that the other guy's insurance company looked at the situation and settled with my sister's estate basically immediately." But because "that payment didn't amount to much," that insurance company could have reasonably decided that there was little point in spending the small insurance limits on attorneys instead of just writing a check. Progressive had more money at stake and more reason to defend.
Yes, "[c]arrying Progressive insurance and getting into an accident does not entitle you to the value of your insurance policy." But that's true for all insurance companies when the policy holder is not in a no-fault state. Progressive isn't unique in that regard.
As of 2007, Maryland permits recovery on a "bad faith" theory against insurers who refuse to pay claims where liability is not "fairly debatable." One would expect that Progressive would not have taken the action it did, and risk liability, if their position was not "fairly debatable." (See the entertaining story of Rex DeGeorge for examples of insurance companies being quick to pay when bad faith might be at issue.) The author seems to concede that Progressive's position was fairly debatable; he also makes no mention about further litigation against Progressive for its initial refusal to pay.
One sympathizes with the author for the tragic loss of his sister. But his fury at Progressive is misguided. Katie, and other Maryland drivers, pay as little for auto insurance as they do precisely because insurance companies don't have to immediately pony up when they are not liable. One could ask for different rules, but consumers would be paying for those different rules up front. Related: Consumerist.
In March, I discussed the Apple iPhone 4 settlement, where the attorneys negotiated a self-dealing attorney-friendly settlement that gave them clear sailing for $5.9 million and said "I will be surprised if there are 40,000 claims."
Color me mildly surprised: there were 44,000 claims, worth about $650,000 to the class. Judge Whyte of the Northern District of California cut the fee request to the inflated lodestar of $2.2 million without a multiplier, so the attorneys are only collecting a bit less than four times as much as their clients instead of nine to ten times as much. Apple, which was willing to give an extra $3.7 million to settle the case, gets to keep the money: the attorney greed and breach of fiduciary duty to their clients means that that money is left on the table instead of going to the class. This should have led to class decertification, but the attorneys will walk away with millions, which is why they're not too critical in the press of the multi-million-dollar haircut.
Defense counsel facing the Rothken Law Firm in Novato, Gardy & Notis in New Jersey, Robbins Geller Rudman & Dowd in Florida, or Kirtland & Packard in El Segundo in future cases, however, should absolutely raise this breach of fiduciary duty to the class in opposing any Rule 23(g) motion: these firms have demonstrated that they will abuse the attorney-client relationship and happily deny their own clients millions for a chance at a windfall.
But the California Bar is too busy protecting clients from a voluntary relationship with Stephen Glass to look into cases where attorneys who have already passed the bar are self-dealing and stealing millions from involuntary clients.
Legal Intern, Manhattan Institute's Center for Legal Policy
In a recent Featured Column on POL, Richard Epstein criticized a proposal put forth by law professor Richard Hockett that would allow local governments to address the mortgage crisis via eminent domain. Epstein explained the proposal as follows:
Now we have another equally bad proposal to intervene in the mortgage market. Recent pieces in the New York Times by Joe Nocera and Robert Schiller, have eagerly embraced an idea put forward by Cornell University Law Professor Robert C. Hockett. In an incredibly tedious and self-important article, Hockett suggests that local government agencies use eminent domain power to condemn mortgages that are underwater but not yet in default--at reduced prices (what Nocera calls "steep but fair discount")--and then let some municipal authority refinance the loans and resell them in bundles for a profit to the agencies in question. Naturally such a scheme would require a middle man, and a fat fee. Mortgage Resolution Partners (whom Hockett advises) is happy to play that role.
Earlier this week, Hockett's eminent domain proposal found another skeptic. Edward DeMarco, chief regulator for Fannie Mae and Freddie Mac, issued a public notice under the auspices of the FHFA expressing concerns about using eminent domain to condemn underwater mortgages:
FHFA has significant concerns about the use of eminent domain to revise existing financial contracts and the alteration of the value of Enterprise or Bank securities holdings. In the case of the Enterprises, resulting losses from such a program would represent a cost ultimately borne by taxpayers.
Among other things, the FHFA is worried about the constitutionality of the proposal, its possible effects on holders of existing securities and contracts, and the potential cost to taxpayers. The FHFA even warned that it might take action against local governments that institute such proposals:
FHFA has determined that action may be necessary on its part as conservator for the Enterprises and as regulator for the Banks to avoid a risk to safe and sound operations and to avoid taxpayer expense.
The FHFA's public notice included an invitation for public commentary on the matter up until September 7th as the agency "moves forward with its deliberations on appropriate action." In the meantime, taxpayers have a well-placed ally in the fight against this "fancy con game."
Legal Intern, Manhattan Institute's Center for Legal Policy
Who says cozying up to pro-attorney interest groups can't be a bipartisan exercise? The Wall Street Journal picked up on some curious words by Republican Senator Lindsey Graham during a keynote speech at the ABA's recent annual meeting:
Mr. Graham, who serves on the Senate Judiciary Committee praised the group's work vetting judicial nominees. "That service you provide the United States Senate is invaluable because in these politically charged times in which we live," he said, "you are a filter, sort of a wall, between people who are politically connected and somebody who should be on the bench."
This politically charged environment, Mr. Graham maintains, is the result of the Senate's broken process. "I'm really worried about how we're doing confirmations. They're turning into political events," the South Carolina Republican said. "I'm not worried about judicial activism, I'm worried about Senate activism."
Sen. Graham went on to claim that judicial nominees, regardless of ideology, "are entitled to be confirmed as long as they're qualified." Such comments by Sen. Graham would seem to fly in the face of his actions on the Senate floor, where the Senator has voted to block several Obama nominees that were rated as "well qualified" by the ABA.
More controversial, however, is the ABA's vetting process itself. Far from creating a "filter" or "wall" between politics and qualifications as Sen. Graham suggested, the ABA's judicial evaluations appear to be heavily influenced by politics given the ABA's preference for liberal nominees over conservative nominees. [See also on POL]. The most frequently cited example of bias is the ABA's sparkling rating ("well qualified") for Obama's recent Ninth Circuit nominee Goodwin Liu compared to its lukewarm rating ("qualified/not qualified") for Reagan's Seventh Circuit nominee Frank Easterbrook. For perspective, at the time of his nomination Easterbrook's curriculum vitae (former judicial clerk, assistant to the Solicitor General, Deputy Solicitor General, 20 cases argued before Supreme Court, career in academia) dwarfed Goodwin Liu's credentials (former clerk and academic, no cases argued before the Supreme Court).
The bias of the ABA led the Bush Administration to exclude it from the process of evaluating judicial nominees. Undeterred, the ABA further inserted itself into the political arena during Obama's time in office by openly lobbying the Senate to schedule votes on Obama nominees. In light of the ABA's politicized history - and Sen. Graham's own voting record - the Senator's comments to the ABA were curious indeed.
Legal Intern, Manhattan Institute's Center for Legal Policy
With attention from the likes of George Will and the Wall Street Journal, the "whale whistling" story has shed light on the concept of overcriminalization. [POL]. By now the facts of Nancy Black's predicament are well-known: She is being charged for making a "false statement" concerning her whale-watching activities to federal officials under Title 18, Sec. 1001 of the U.S. Code. This statute has proven quite useful to the feds, especially when they are unable to pin any other charges on a person they suspect of wrongdoing (like Ms. Black, who was originally under investigation for whale harassment).
Could it be that Sec. 1001 - an already overbroad statute - could be getting even broader? Lost in the obsession over NFIB v. Sebelius at the end of the Supreme Court's recent term was the Court's denial of certiorari in King v. United States, a case involving Sec. 1001. In King, the Ninth Circuit ruled that an Idaho rancher who lied to state officials could face federal criminal liability.
The [Ninth Circuit] wrote that "King lied to Klimes, one of the [Idaho] investigators, in order to defeat the investigation. A willful injection of fluid into a deep well without a permit from the State of Idaho is a federal crime under the Safe Drinking Water Act. Therefore, King made a false statement in a 'matter within the jurisdiction' of the United States." The Court's argument, in other words, was the essence of the overfederalization: 'You violated a state law and you lied about it to a state official. That's a federal offense.' [rightoncrime.com].
An amicus brief was filed in the case by a broad coalition of organizations (from the Cato Institute to the National Association of Criminal Defense Lawyers), noting that before the year 1984, Sec. 1001 was only used when false statements were made to federal officials; since then, however, it has been extended to create federal criminal liability for false statements made to state officials as well.
The trend toward more federal criminal liability - dubbed "overfederalization" of crime - is not limited to Sec. 1001. In fact, stories abound of individuals becoming ensnared in abstruse and obscure federal laws - and even facing jail time as a result. [Previously on POL]. In fact, just yesterday, the Heritage Foundation highlighted an effort to pass another redundant federal criminal law:
The SAFE DOSES Act, which just passed the House, makes stealing medical equipment a federal crime punishable by up to 30 years in prison and a $1,000,000 fine.
There is no doubt that conduct of the kind mentioned in the SAFE DOSES Act is wrong and should be punished criminally. But does it need to be prosecuted on the federal level? Are the state laws governing the crimes of theft, burglary, and larceny inadequate to address the crime of stealing medical equipment?
The answer is no. All 50 states already have laws under which they can prosecute the misconduct covered in the SAFE DOSES Act. In fact, the federal government does, too.
As the Heritage piece alludes to (but does not outright say), the SAFE DOSES Act is deficit neutral and thus provides Congress with an opportunity to pass something during these budget-strapped times. It also gives congressmen the chance to pose as tough on crime. The losers are average citizens, facing the Leviathan that is our criminal code.
Yesterday on Twitter, trial lawyer Max Kennerly accused me of promoting non-substantive policies in a throwaway tweet. I challenged him to name one. Rather than admit that he was wrong, he made up one: he falsely claims that I think "injury plaintiffs should always lose." This is clearly false, and I told him so.
He asked me to name five injury plaintiffs I thought should win; because of Twitter's 140-character-limit, I understood his "injury" to mean "injury" when he apparently had a secret meaning as "personal injury," when I listed five injured plaintiffs. So he's now claiming that because "injury" means something other than "injury," my examples didn't actually involve injuries and is making hay over the misunderstanding of his imprecision instead of being intellectually honest—including misrepresenting the result of Dewey v. Volkswagen, where class action attorneys tried to screw over a million class members who will now be able to collect for their injuries.
I've long complained about the game-show aspects of modern trial practice. Rather than a search for truth, trials have become a series of attempts by both sides to play "gotcha": can the lawyer trick the witness into saying something damaging that isn't true? Can the lawyer take an innocuous document out of context and fool a jury into thinking it is a smoking gun? Here, I apparently was supposed to respond "What do you mean when you say 'injury'?" instead of treating Kennerly as an intellectually honest person engaging in a conversation using the English language, and now he's playing "gotcha" because he had a secret definition of "injury" that I didn't deduce when he asked the question, and pretending that I couldn't answer the question he never actually asked.
It sort of shows the intellectual bankruptcy of reform opponents that Kennerly can't identify a single policy position where I'm wrong and feels the need to invent and attack a position that I've never taken and, indeed, no reformer has ever taken. Of course there are scenarios where personal-injury plaintiffs should win; I've even defended the position of plaintiffs in some hot-coffee lawsuits, for crying out loud. I've loudly condemned the medical malpractice at Desert Shadow Endoscopy (where trial lawyers ignored the malpractice and instead went after innocent deep pockets with the help of questionable judicial rulings). A friend of mine was recently the smaller mass in a pedestrian versus automobile accident, and should recover reasonable damages for her injuries against the negligent driver; when have I ever implied otherwise?
Kennerly owes me an apology, but he owed me a retraction the first time for his attack, and instead doubled down with additional dishonesty, and has now tripled down by expanding a forgivable tweet into a thoroughly offensive blog post (which he knows is false), so I don't expect it. But as I've discovered in the last three years of fighting trial lawyers ripping off "injury plaintiffs" (and winning millions of dollars for such "injury plaintiffs," often with the trial lawyers kicking and screaming against these recoveries), no matter how low my opinion of trial lawyers, I somehow manage to regularly underestimate how low they will go to promote their profits over people.
The guitar-maker, a living example of overcriminalization after a raid and threatened felony convictions for executives over technical violations of the Lacey Act, got an offer too good to refuse: a criminal enforcement agreement of a $300,000 fine, forfeiture of about that much worth of ebony wood, and a $50,000 contribution to the U.S. National Fish and Wildlife Foundation. [Reuters]
This is obviously a good deal for Gibson: they would have spent at least that much money on lawyers defending themselves, their executives are no longer being hassled, and there is no longer a worry of prison time.
Less obvious is that it is a good deal for abusive government prosecutors and the Obama administration: Gibson was planning on setting up camp at the RNC to promote the problem of overcriminalization, and now their arguments have less force. Though the settlement is plainly a nuisance settlement (the government surely spent more than $600,000 bringing this case), Gibson makes admissions that it "failed to act on information that the Madagascar ebony it was purchasing may have violated laws intended to limit over-harvesting and conserve valuable wood species from Madagascar," and the government can pretend that it actually did something to protect the environment rather than just enforcing an arbitrary law promoted by local industry to eliminate competition from imports. It is worrisome that the very vocal Gibson Chief Executive Officer Henry Juszkiewicz has had no comment, suggesting that one set of lawyers or the other have silenced him. But the problem of overcriminalization remains, and the government's awesome prosecutorial power means that it can coerce criminal enforcement agreements that smear the victims just enough to preclude them from being effective voices against prosecutorial abuse.
Take, for example, the recent $3 billion fine paid by GlaxoSmithKline. Gosh, with so much money paid, GSK must have done something wrong. Except the government's remedy for the most technical of violations is debarment, a death penalty for pharmaceutical manufacturers. The government holds all the cards here; even if the company is entirely innocent and there's only a 5% chance of losing, a defendant drug company is going settle for whatever the government asks for, because the consequences of fighting and losing are essentially bankruptcy--and I'm not aware of anyone who thinks courts get it right 95% of the time. Meanwhile the government attorneys have every incentive to take advantage of this dynamic to promote their careers. The charges against GSK include complaints that low-level sales reps provided truthful information to doctors, just outside the scope of FDA approval. Unfortunately, no defendant is willing to bet the company on a First Amendment challenge. Manufacturers are afraid to speak out for fear of attracting adverse government attention. So we're all worse off because of the government's ban on truthful speech by certain commercial actors, and there's no political constituency to raise it because of the mud thrown on the victims because the parties agree to characterize the conduct as "fraud."
In the eyes of the Obama administration, most Democratic lawmakers, and left-leaning editorial pages across the country, voter fraud is a problem that doesn't exist. Allegations of fraud, they say, are little more than pretexts conjured up by Republicans to justify voter ID laws designed to suppress Democratic turnout.
That argument becomes much harder to make after reading a discussion of the 2008 Minnesota Senate race in "Who's Counting?", a new book by conservative journalist John Fund and former Bush Justice Department official Hans von Spakovsky. ...
One example: 1,099 felons illegally voted in the 2008 Minnesota race for U.S. Senator that Al Franken won by 312 votes; despite reluctant prosecutors, 177 have been convicted of voting fraud. With "evidence suggesting that felons, when they do vote, strongly favor Democrats, it doesn't require a leap to suggest there might one day be proof that Al Franken was elected on the strength of voter fraud."
Meanwhile, the Justice Department seems to be moving purely on political grounds, suing to prevent election laws making it easier for military members to vote while simultaneously suing to prevent states from adopting voter ID laws, though the latter have already been deemed constitutional by the Supreme Court. [Krauthammer]
A San Jose Mercury News investigation "found a small group of court-appointed personal and estate managers submitting huge, questionable bills--and if people challenge them, they charge more." In one case a disabled man was charged $108,000 by a trustee over the course of four and a half months, and then another $145,000 when the trustee defended the original fee request. The fact that challenging fees may make the beneficiaries worse off is a powerful deterrent to challenging the fees, which in turn makes it less likely that fees will be challenged, inviting abuse.
This why cases such as the State Bar of California's pursuit of Stephen Glass bother me. It's a colorable position to forbid Glass from bar membership for journalistic wrongdoing in the last century, as is the argument to forgive him if he's shown sufficient remorse and good deeds since. But the State Bar's hard line on Glass would be better served focusing on existing members who routinely rip off their clients in the trust and class action context, even if the latter is considerably less high profile. Of course, that assumes that legal licensing is actually meant to protect consumers rather than the legal cartel.
Buckyballs, which are powerful magnets, are intended for people ages 14 and up; below that age, and one might be too inclined to put the toy in one's mouth, and having multiple powerful magnets in one's digestive system can create problems if two magnets end up physically close to one another with digestive organs in between the magnets, perforating intestines.
The company only markets its toy to adults, but the CPSC wants to ban their sale entirely, filing an administrative complaint. (If one reads press coverage without care, one doesn't realize that the goods have not yet been banned, though most retailers have been mau-maued into dropping the product.) The CPSC's complaint cites one instance where (a) a parent ignored the warning and purchased the toy for a 10-year-old daughter; (b) the daughter ignored the product warning and put some magnets in her mouth to mimic a tongue piercing; and (c) then swallowed the magnets. Thus, because the warnings get ignored, "the Subject Products are defective." The company, which would be driven out of business, is fighting back. [Abnormal Use; Buckyball press release; Time; AP; USA Today]
I'm surprised that this hasn't picked up more headlines and controversy. One can imagine lots of products that are not marketed to children, yet result in death and injury because of a combination of inattentive parenting and childish misuse—guns being the most obvious example. (The ATF, not the CPSC, regulates guns, but there are those who have called for guns to be put in the CPSC's bailiwick.) If government can withhold products adults want and most use safely because of the foolishness of less than 0.01% of the end users, the resulting nanny-statism can make most of us much worse off. This sort of paternalism separates the Obama administration from its opponents (and not just in product-safety regulation, but in financial products as well), and one wishes the Republicans (and common-sense Democrats) would make more of an issue on this rather than leaving banks and businesses to defend themselves.
Legal Intern, Manhattan Institute's Center for Legal Policy
Proponents of extensive medical malpractice liability often suggest that such liability deters doctors from practicing bad medicine. The argument goes as follows: The greater the chance doctors will be held responsible for their negligent actions, the more careful they will be when treating patients.
A new paper by Michael Frakes of Cornell Law School, however, demonstrates the weakness of the relationship between medical malpractice liability and health care quality. The paper analyzes data from 1979 to 2005 and contrasts various medical liability regimes and health quality measurements. Frakes uses "avoidable hospitalizations" and "inpatient mortality rates" as metrics for the quality of health care. Then, he "investigate[s] the malpractice-quality link by exploring the impact of legal reforms, such as damage caps, that arguably blunt the impact of the liability system without effectively changing its structure."
The results of the study suggest a statistically insignificant link between more extensive medical malpractice liability and better quality health care:
The results of this empirical exercise generally cast doubt upon the role that current medical liability rules play in inducing the provision of quality medical care. For instance, the estimated relationship between avoidable hospitalization rates and malpractice pressure, as identified by the adoption of non-economic damage caps and related tort reforms, is both statistically insignificant and small in magnitude, with a 95% confidence interval that is relatively tightly bound around zero. At one end of this interval, the lack of a non-economic damages cap (which is indicative of higher malpractice pressure) is associated with only a 4% decrease in avoidable hospitalizations. That is, at the most, the evidence implies an arguably modest degree of deterrence (with respect to outpatient care). I derive similar findings in exploring the impact of liability pressure on inpatient mortality rates for select conditions.
To be sure, those pushing for greater medical malpractice liability advance other reasons for supporting such a regime apart from better quality care (e.g., the trial bar frequently argues extensive medical malpractice liability is fairer to patients who suffer from negligent care since they can recover greater damages). But, at the very least, this new study has cast doubt upon the notion that exposing doctors to greater liability results in patients receiving better care.
This AP item in today's Washington Post caught our eye, "Cate Edwards, daughter of the former presidential candidate, announces new law firm":
RALEIGH, N.C. -- Cate Edwards, daughter of former presidential candidate John Edwards, has announced she is joining a new public-interest law firm with offices in New York and Washington.
In a post on Twitter, the 30-year-old Edwards said her firm Advocates for Justice will represent "regular, working people."
Yes, and it also appears to be a kissing cousin of the now-defunct radical community organizing group, ACORN.
First, a few notes:
- Advocates for Justice was founded in 2010 by New York attorney Arthur Z. Schwartz, so it's not really that new of a law firm.
- Edwards has been at the firm for a while; in March she wrote a column as an AJA attorney for Politico, "A4J Attorney Cate Edwards: Health Law A Leap Forward For Women." Why would one wait to announce her joining the firm until now? Oh.
- Edwards is more than just a lawyer with the group. According to her bio, she manages the Washington office. Granted, it is a small firm. (Potential media bias alert: Her bio also reveals that while in law school she worked for a summer for NPR Supreme Court reporter Nina Totenberg.)
We get curious, a little suspicious, when an organization uses the much misappropriated word "justice" in their title, so sought more information about Advocates for Justice. The group's [original] website, www.advocatesforjustice.net, says it's a 501(c)3, with the following mission:
Advocates for Justice exists to fight fights of working people, to fight for racial justice and equal rights, and to assist those who organize the poor and working people, and who advance the fight for equality. Advocates for Justice will do research, publish educational and investigative materials, and organize lawyers across the country to provide pro bono and low fee legal representation to fulfill its purpose.
The Blog of The Legal Times has more on the firm, "Public Interest Law Firm Opens in D.C., New York."
The Los Angeles trial lawyer who raised the issue of declining membership when campaigning for vice president of the American Association of Justice lost the race to a well-known Dallas attorney.
As we reported in this PoL post, Farrise's statement of candidacy stated: "[Instead] of increasing our numbers, AAJ continues to shed members at an alarming rate." An AAJ spokesman later disputed the claim as misleading. (PoL)
Baron Blue campaigned on her AAJ activities and fundraising prowess on behalf of Democratic candidates. She is founder of the Baron and Blue firm in Dallas, which specializes in asbestos lawsuits. Her husband was the late Fred Baron, a prominent plaintiffs' attorney and Democratic contributor.
Legal Intern, Manhattan Institute's Center for Legal Policy
Yesterday, in the case Watts v. Cox Medical Centers, the Supreme Court of Missouri struck down noneconomic damage caps in medical malpractice cases. In 2005, the Missouri legislature passed, and then-Governor Matt Blunt signed, a law that limited noneconomic damages in medical malpractice cases to $350,000.
The state Supreme Court struck down this cap in a 4-3 decision (all four members of the majority were appointed by Democratic governors). Chief Justice Richard B. Teitelman, writing for the majority in Watts, held that the damage caps violated a jury trial right that Missourians had enjoyed since the common law era:
As such, section 538.210 directly curtails the jury's determination of damages and, as a result, necessarily infringes on the right to trial by jury when applied to a cause of action to which the right to jury trial attaches at common law. Because the common law did not provide for legislative limits on the jury's assessment of civil damages, Missouri citizens retain their individual right to trial by jury...
Prior to the 2005 legislation, Missouri capped noneconomic damages at $579,000; the 2005 law lowered this amount to $350,000 and made the cap apply to the total amount owed by all the defendants instead of merely having the cap apply to each defendant individually. The majority in Watts overruled a previous state Supreme Court ruling in Adams By and Through Adams v. Children's Mercy Hosp., which had held damage caps constitutional under state law.
The dissent argued that Adams should be followed in adherence to the doctrine of stare decisis, as well as pointing out that, even if the absence of precedent, Missourian's right to a jury trial was not undermined by damage caps:
The jury serves no function other than providing an individual his right to a trial by jury. As such, the jury's "constitutional task" is to provide one with his or her "individual right" to a trial by jury. Section 538.210 does not prevent the jury from assessing damages. It is only after the jury assesses damages that the trial court applies section 538.210. When the jury performs its "constitutional task," the plaintiff is afforded his or her "individual right" to a trial by jury.
The trial lawyers cheered the Watts decision as a great victory for victims of medical malpractice. Importantly, however, Missouri's cap applied only to noneconomic damages, such as "pain and suffering," and did not cap the cost of future medical care a patient might need as a result of a doctor's inadequate care. The Republican controlled legislature is considering plans to place a constitutional amendment on the ballot in November as a way to circumvent the court's ruling.
[UPDATE: Carrie Severino of National Review's Bench Memos suggests that Missouri's method for selecting judges - eponymously named the Missouri Plan - may have contributed to the outcome in Watts:
The [Watts] decision doesn't come as a surprise. Critics of the Missouri Plan for selecting judges, myself included, have long argued that it allows trial lawyers to hand-pick judges, dramatically increasing the probability that the state's jurisprudence will mirror the trial bar's priorities. The trial bar's influence appeared evident in the majority opinion's reasoning.
The Missouri Plan model consists of a "non-partisan" committee that sends a list of potential judicial candidates to the state Governor for selection. Critics of the plan have suggested that such selection committees are often dominated by trial lawyers, leading to judges who are sympathetic to the trial lawyers' agenda.]