December 23, 2009

Around the web, December 23

• Towers Perrin/Tillinghast survey predicts pickup in tort costs [Mark Hofmann, Business Insurance; Daniel Hays, National Underwriter; report in PDF]
• New $23 million slug of money for EEOC enforcement is couched as backlog reduction so that must be okay [NLJ]
• Ameet Sachdev of Chicago Tribune interviews Mark Herrmann on law blogging; why most blogs that come out of big law firms aren't very good [Beck & Herrmann]
• Illinois Supreme Court reverses economic damages Baycol class certification [Drug & Device Law, Jackson] "Federal Court Refuses to Certify Personal Injury Class in Suture MDL" [Jackson] "Federal Court Allows Nationwide UCL Class Action via California's Unfair Competition Law" [Cal Civil Justice]
• Ninth Circuit accuses Jerry Brown's office of making false statements to court in pharmacist case [Egelko, SF Chronicle via Legal Ethics Forum]
• "Erosion of ownership rights" [Quin Hillyer, Washington Times]

October 8, 2009

"Lawsuit Growth in 2008"

Mass Tort Lit summarizes some of the 2009 Law360 Litigation Almanac highlights. "Among the federal-court findings: class actions rose 8% (reaching an all-time high); product liability litigation increased 20%; federal environmental lawsuits went up for the first time since 2005; and, in contrast, securities litigation dropped by 8%."

September 17, 2009

Around the web, September 17

• Hill committee jurisdiction: if tort expansion (Medicare secondary payor) can go through Ways & Means, why must tort reduction (med mal) go only through Judiciary? [ShopFloor]
• In the mail, lively and readable if unsettling book: "Courtroom Cowboy: The Life of [Philly lawyer] Jim Beasley" [on Amazon]
• "Drug companies say there are bogus Digitek suits" [WV Record, more, Wajert/Mass Tort Defense]
• EEOC suit: AT&T violates age-bias law by not rehiring early-retirement-takers [Schwartz, ABA Journal]
• Oklahoma lawprof Patricia Hatamyar, evidently no enthusiast of litigation reform, takes a look at filings in that state [Mass Tort Lit]
• We seem to be going pretty strong at five-years-plus: "The Life Expectancy of a Legal Blog" [Beck & Herrmann & followup]

September 11, 2009

Game theory and med-mal settlements

From Point of Law contributors Ted Frank (Center for Class Action Fairness) & Marie Gryphon (Manhattan Institute), "Negotiating in the Shadow of 'Bad Faith' Refusal to Settle: A Game Theory Model of Medical Malpractice Pre-Trial Settlements and Insurance Limits" on SSRN. Abstract:

Recent empirical studies of Texas data by Hyman et al, Zeiler et al, and Silver et al suggest that insurance limits affect settlements of medical malpractice cases. Writing separately, Silver argues that insurance limits act as a de facto cap on malpractice payouts, that plaintiffs are being underpaid as a result, and that therefore legislative caps on damages are unnecessary. But this hypothesis is inconsistent with the data, which indicates that forty-seven percent of cases in which plaintiffs obtain verdicts above policy limits are subsequently settled above policy limits. The analysis of data in the Hyman, Zeiler and Silver papers does not give a complete account of the effects that third-party causes of action for alleged bad-faith refusal to settle - known in Texas as a Stowers action - have on pretrial settlement negotiations. If an insurer in Texas is presented with a settlement offer within insurance limits, refuses to settle, and the plaintiff wins an award greater than insurance limits, the plaintiff is entitled to sue the insurer for the full damages amount, plus punitive damages, for refusal to settle. In this paper, we explore the game theory of medical malpractice settlement negotiations in the shadow of Stowers.

Using a Monte Carlo simulation of the "game," we find: (1) plaintiffs have an incentive to make, and defendants have an incentive to accept, settlement offers at insurance limits; (2) a settlement at insurance limits may therefore sometimes reflect something other than the quality of the underlying medical malpractice case; (3) the possibility of Stowers awards increases expected returns to plaintiffs and disproportionately increases the settlement value of low-merit cases; (4) plaintiffs with weak cases are systematically overcompensated, while plaintiffs with strong cases are systematically under compensated; and (5) non-economics damages caps have the greatest effect on low-merit cases by reducing overcompensation, without affecting the highest-merit cases.

September 4, 2009

Black, Hyman and Silver on early offers

SSRN via TortsProf: the team of Bernard Black (Texas), David Hyman (Illinois), & Charles Silver (Texas) use Texas data to "simulate" the effects of the sort of plan long championed by Virginia's Jeffrey O'Connell. They predict:

An early offer program will (i) sharply reduce payouts in cases with small economic damages; (ii) will not materially affect predicted payouts in other cases; (iii) will have very different effects on different types of plaintiffs, with large payout reductions for elderly and deceased plaintiffs and much smaller effects for newborns and employed adult plaintiffs; and (iv) will overlap substantially in its effects with statutory caps on non-economic damages, and hence have a smaller effect in states with these caps.

September 1, 2009

Around the web, September 1

• Former Senator Bill Bradley proposes an Obamacare compromise: "Tax Reform's Lesson for Health Care Reform" [NY Times]. One critic gloats/scoffs that Republicans aren't serious about malpractice reform except as an opposition issue since they didn't try it when in office [Jonathan Zasloff, SameFacts] And I have a link roundup at Overlawyered on the subject.
• Bahind the bankruptcy-claims capitulation, political brute force: "Chrysler yielded to pressure from consumer groups that aggressively lobbied for a law requiring warning stickers on used Chrysler vehicles, an effort which would have reduced the value of the vehicles." [Day]
• Penn lawprof Tom Baker, whose policy views tend toward the opposite of those espoused here, has some good insights on shortcomings of insurance company data as a way of assessing litigation trends [SSRN via Mass Tort Prof]
• Imagine that, injured parties seeking damages: "Civil Rights Defendants Going After Attorney Fees" [The Recorder]
• Trial lawyers' political activism in California has been bad news for that state's economy [John Sullivan (CJAC), SF Chronicle]
• "Securities Class Actions to Come to India?" [Karlsgodt]

August 3, 2009

Sampling med-mal verdicts

I talk back to Ronald Miller about the significance of a six-month slice of D.C. trial information, and then he talks back to me.

June 4, 2009

Pacific Research Institute, "Tort Law Tally"

Recently out from Pacific Research Institute (PDF), authored by Nicole V. Crain, W. Mark Crain, Lawrence J. McQuillan, and Hovannes Abramyan, "Tort Law Tally: How State Tort reforms affect Tort Losses and Tort Insurance Premiums". From the executive summary:

Of the 25 tort reforms that we examine, the statistical analysis identifies 18 reforms to state civil-justice systems that significantly reduced tort losses and tort insurance premiums from 1996 through 2006. For some categories of tort cases, specific reforms cut payouts by more than 50 percent. The cumulative effect of reforms across all tort categories is a 47-percent reduction in losses and a 16-percent reduction in insurance premiums for consumers. Some tort reforms are highly effective at reducing costs in certain tort categories, but are ineffective in other tort categories. It is important that reformers pick the right tool for each problem. If we order the tort reforms according to each reform's ability to reduce aggregate tort losses, the top eight reforms are: attorney-retention sunshine (12 percent), Daubert/Frye (10 percent), frivolous lawsuits (7 percent), jury service (6 percent), appeal-bond caps (4 percent), negligence standard (3 percent), non-economic-damage caps (2 percent), and medical-malpractice damage caps (1 percent).

Related op-ed: PRI president Sally Pipes in D.C. Examiner.

April 23, 2009

The more regulation, the less litigation?

And vice versa? One does hear that line an awful lot, but a new study by Eric Helland and Jonathan Klick (The Relation Between Regulation and Class Actions: Evidence from the Insurance Industry) suggests it might not be so (via Lahav, Mass Tort Prof).

April 20, 2009

Around the web, April 20

• Advice for lawyers: "Dealing with the Difficult Adversary" (and in particular the "Bully"). [Day on Torts]
• "Judicial Council of California Report on Class Action Trends Released" [Karlsgodt]
• Cessna wins ruling that plane crash in Italy should be sued there [Legal Times]
• Consumerists who bash insurers don't seem to have very clear idea what they want from the industry [Martin Grace, RiskProf, first and second posts]
  
• Case against actual Brooklyn gangster could help set boundaries on civil RICO as weapon against legitimate businesses [Forbes]
• Wisconsin Gov. Jim Doyle at forefront of efforts to undo state's liability limits [Carter @ ShopFloor]