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October 2010 Archives

The American Association for Justice is recruiting member lawyers to go to Nevada as "election protection volunteers" to support Sen. Harry Reid. The e-mail solicitation was posted at the Fix Pacifica blog, and we've uploaded a copy here. Excerpt:

We've heard the reports about the situation in Nevada. The Angle campaign is already employing voter intimidation techniques aimed at suppressing the Democratic vote. In the state of Nevada, anyone who is a listed as a registered voter can cast their ballot. Try and imagine what the future will hold if we don't have Harry Reid in the Senate. He is a staunch advocate for trial lawyers and the clients they represent, and has fought tirelessly to stop tort reform efforts in the Senate. Don't let the GOP scare people away from the polls. Be an advocate. Volunteer to be a poll watcher today.

• Factcheck.org does a reasonable job reporting on the campaign advertising and politics in the Supreme Court election in Michigan and court retention elections in Illinois and Iowa. However, the piece, "Court Watch: Mudfest 2010," understates the scurrilousness of the attacks against Bob Young, seeking re-election to the court in Michigan. See Detroit Free Press editorial blog post by Stephen Henderson, "Dems cross the line with bigoted Supreme Court ad."

• Two seats are open on the Michigan Supreme Court, which go to the top two finishers. In a new poll, the two Republicans, Young and Mary Beth Kelly, have opened up substantial leads on the two Democrats, Alton Davis and Denise Langford Morris. (Disclosure: Young was appointed to the court by Gov. John Engler, now my boss at the National Association of Manufacturers.)

• In Iowa, Vice President Joe Biden headlined a campaign rally for Rep. Bruce Braley (D-IA), the past president of the Iowa Trial Lawyers Association. He's opposed by Ben Lange, an attorney from Independence.

• The Democratic Senate candidate in Iowa, Roxanne Conlin, is the former president of the Association of Trial Lawyers of America. Her campaign has gained little purchase against Sen. Charles Grassley (R-IA).

• News release, The Civil Justice Association of California, "SACRAMENTO, Calif.--(BUSINESS WIRE)--California plaintiffs' lawyers spent another $150,000 this week to help elect Dave Jones as the state's new Insurance Commissioner, bringing their total investment in the race to $644,400, the Civil Justice Association of California reported today."

• The Southeast Texas Record (supported by the U.S. Chamber) reports, "Texas trial lawyers spend $13M in 2010 election cycle": "Texas trial lawyers surpassed their 2008 benchmark for campaign spending, shelling out $13.6 million so far in 2010, with famed Houston hurricane attorney Steve Mostyn providing almost half the cash."

• More on Texas campaign contributions from The Texas Tribune, "Millions Fund Last Month of Texas Campaigns."

Madison County asbestos

Plaintiff-friendly procedures in infamous judicial hellhole Madison County are "a cautionary tale about the power of procedural 'innovations,' the ability of a judge or judges in one location to impact the entire national system of litigation, the extreme mobility of asbestos claims and the tyranny of economic incentives." [ILR; LNL]

Around the web, October 29

  • After the leak of this Larry Tribe letter, we perhaps know who bad-mouthed Sonia Sotomayor to Jeff Rosen. The bad-mouthing of Justices Breyer and Kennedy (and smear of Diane Wood) are also in there. Don't miss the last-paragraph flattery. Above the Law unusually ignores the juicy story. [Whelan @ NRO; more; more]
  • State attorneys general demand that banks be more lenient with mortgage foreclosures, sue banks for being too lenient. [Jenkins @ WSJ via Stoll]
  • Credit scores are handy ways to predict job performance in hiring. So the EEOC is naturally against it. [OL]
  • New York state retroactively rewrites every mortgage in the state to forbid one-way fee-shifting. [NYLJ]
  • Happy birthday, Drug and Device Law Blog! [Abnormal Use]
  • Elizabeth Warren doing end-around Dodd-Frank procedures, checks and balances. [Freire @ Examiner]
  • Obama administration expected to shift to regulatory process after mid-term losses in granting trial-lawyer earmarks that expand liability. [WSJ]
  • A must-read article and book on the counterproductiveness of humanitarian aid: "If you use enough violence, aid will arrive, and if you use even more violence, even more aid will arrive." [New Yorker ($); The Crisis Caravan]
  • An entertaining polemic from a master of the art against Richard Blumenthal, but his Senate-race lead appears insurmountable. [Coulter]
  • I'm shocked, shocked, to find Paul Krugman being intellectually dishonest. [Cafe Hayek]

Adorno suspended, faces disbarment

Prominent Florida attorney Henry "Hank" Adorno suspended by Florida Supreme Court and faces disbarment for a remarkable breach of fiduciary duty in negotiating a class action settlement that wasn't a class action settlement. One can see why he's surprised, given that his explicit collusion with defendants to cheat the class was different only in degree to standard class action plaintiffs' attorneys' practice. The Miami city attorneys on the side of the settlement, who claimed to have been snookered, haven't faced any discipline, despite what was effectively a stunning admission of incompetence. [Miami Herald; S. Fla. Bus. J.; major filings in case; Masztal v. Miami]

George Will does not think much of Connecticut Attorney General Richard Blumenthal, running for the U.S. Senate against wrestling impresaria Linda McMahon. In today's column, Will provides telling examples of Blumenthal's penchant for falsehood.

On MSNBC he intimated that he would not take "special interest" or PAC money, promising fundraising "from ordinary citizens." But he flew to Vancouver, British Columbia, for a PAC fundraising event for him and 11 other Democratic Senate candidates. Blumenthal said it was not for Harry Reid. Hartford Courant columnist Kevin Rennie reports that the invitation to the event and documents filed with the Federal Election Commission say Reid was among the beneficiaries. Blumenthal says it was an opportunity to discuss problems "affecting ordinary people." Rennie says the top ticket price was $43,200.

Oh, to be George Will's editor. The fundraiser that Blumenthal flew took place at the annual convention of the American Association for Justice, most definitely not "ordinary citizens." More like a special interest, but in any case, a connection that needed to be made.

Attendance at the fundraiser quickly became a point of attack in the Senate races in Illinois, Iowa, Louisiana, and elsewhere.

Our friend Richard Epstein has an important new paper out with the Manhattan Institute's Project FDA: How Conflict-of-Interest Rules Endanger Medical Progress and Cures . See also his column in Forbes.com.

I cast an early ballot in Washington, D.C., last evening, preparing to become one of the many undervotes on every race. There are candidates for U.S. Representative? When did the states ratify that constitutional amendment? (DC Voter Guide)

Should have done my homework. On the ballot is a charter amendment to make the district's attorney general's office, now filled by mayoral appointment, an elected position. (Proposed Charter Amendment IV) The City Council voted 12-1 in February to put the measure on the ballot; if approved, voters would elect the AG beginning in 2014.

I reasoned out my no vote this way:

As a matter of practical politics, this is a terrible idea. The District of Columbia is a one-party state district, in which the winner of the Democratic primary will be a shoo-in for AG. Two kinds of candidates seem likely to succeed: a populist promising to bring down business and redistribute wealth, or a glib practitioner of cynical politics with access to trial lawyer contributions. Or a combination of both.

I'm honored that Skadden's John Beisner, one of the world's leading class action attorneys, Jessica Miller, and Jordan Schwartz today released a new paper on cy pres that heavily relies upon my work and the work of the Center for Class Action Fairness in the AOL case, even singling out that case as an example of abusive cy pres.

Around the web, October 28

  • "Foreclosures on the rocks" [OL]
  • Vaccines and the Supreme Court. [Fumento]
  • Ninth Circuit panel on Arizona immigration includes Judge Paez, whom we've seen before. [Politico]
  • John Berlau repeats my warning about Dodd-Frank and free checking. [WSJ]
  • California court sides with attorneys against SLAPP victims. [Cal. Attorney's Fees blog; Moore v. Kaufman]
  • Similarly, panelists at a Chamber of Commerce event lament that attorneys have yet to be sanctioned in the silicosis fraud case of years and years ago now. [BLT]
  • A Florida town notorious for insurance fraud has government shenanigans going on still. [St. P. Times]
  • Democrats' double-standard on anonymous election speech. [Hayward @ NRO]

Sundry and various ...

A recent piece of perfervid direct mail from Public Citizen demands criminal prosecution of BP executives, calling the company "a reckless criminal recidivist corporation. With a long rap sheet." Read the letter here. The litigation will continue for years, but is the outrage over the Deepwater Horizon accident sustainable as a fundraiser without new photos of begrimed shore birds?

In its selection of issues and amped-up outrage, Public Citizen's letter reads like it could have come from the American Association of Justice, the trial lawyers' lobby. Voila, here are the pages from the AAJ's 3rd quarter lobbying disclosure form that list its activities on maritime and environmental liability issues.

A great source of intelligence and commentary on the Gulf of Mexico litigation is the Jere Beasley Report, the blog and monthly report of the Alabama avocat grise and leader of the Beasley Allen firm. Here's the section devoted to the drilling accident.

One issue in the Alabama attorney general's race is whether the state should hire outside counsel to pursue its legal claims against BP . Judging from the comments in this campaign profile, Democrat James Anderson appears more willing than the Republican candidate, Luther Strange, to farm out litigation to the private sector. A poll commissioned by the state's major newspaper released Sundayreports that Strange was supported by 47 percent of potential voters against 33 percent for Anderson. Strange supports the states' lawsuit against the federal health care law, Anderson does not.

Los Angeles Times, Oct. 21, "3 environmental groups sue BP over gulf oil spill"

Diversity and corporate governance

Larry Ribstein is skeptical, and wonders if the emphasis on diversity at the board level suggests that the board is entirely extraneous.

Confiscatory ObamaCare taxes

According to the Kaiser Foundation's Health Reform Subsidy Calculator (via IBD), a 62-year-old in a high-cost area earning $46,000 a year without health insurance is entitled to a $7,836 government tax credit. Leaving aside how our strapped government can afford that, here's what's interesting: if the same person makes a mistake and earns an extra $22 in income, he loses the entire $7,836 credit. (The cutoff, according to Kaiser, is between $46,021 and $46,022.) That's a 35,618% marginal tax rate. Indeed, the problem is so severe that our 62-year-old subject will have more take-home pay if he earns $46,000 than if he earns $55,000. And even at lower income levels, there is as much as a 16% surcharge on income at the margin.

It's been trendy to sneer at those who label the Obama administration's policies as socialism, but even under socialism, the government doesn't punish you and make you worse off for working more. This is just public policy malpractice.

Harriet Miers profile

Mickey Kaus, tongue-in-cheek, suggests a conspiracy is behind all the attention former Bush administration officials are getting shortly before the mid-term elections. If so, the Texas Lawyer puff piece on Harriet Miers is part of the conspiracy. The article, mostly about Miers's career and successful post-Bush-administration lobbying practice, engages in some historical revisionism regarding the unsuccessful Miers nomination (as Jan Crawford documented, Miers's inability to handle basic question on constitutional law was why the Bush administration pulled the plug). But Miers provides a quote that validates conservatives' concern about her acuity on the bench: "In an exclusive interview with Texas Lawyer, Miers instead turns the conversation away from herself to make an argument for more women judges. 'I don't think three is sufficient,' she says." Paging Heather Mac Donald.

Pacific Research Institute videos

PRI has released three five-minute videos on warning labels, judicial hellholes, and the consequences of medical malpractice litigation.

Around the web, October 26

  • Third Circuit holds that junk-science cell-phone radiation claims preempted by federal law. [Beck; Jackson; NLJ; Farina v. Nokia]
  • Journal of Tort Law has special issue dedicated to Richard Epstein. [J Tort L via TortsProf]
  • More in defense of confidentiality designations. [Drug and Device Law]
  • Is federal habeas review of state-court non-capital decisions extraneous? (To which I would add, why stop at non-capital decisions?) [SCOTUSblog]
  • North County Gazette claims that it will sue readers who don't voluntarily donate to read its website. [Boing Boing]

Vulcan Society litigation

MI's Heather Mac Donald has a must-read piece on the Vulcan Society disparate impact employment discrimination litigation, where Judge Nicholas Garaufis has gotten just about every piece of public policy wrong, and made faulty factual findings bootstrapped on other faulty factual findings, all at the expense of New York City taxpayers and those who seek competent firefighters.

Annals of economic protectionism

  • San Francisco: San Francisco Metro Transit Authority & the Public Utilities Commission of California order a startup to cease and desist offering an app by which smartphone users can order car service. [TechCrunch via M.C.]
  • Wisconsin: Seventh Circuit upholds a state law barring gas stations from charging low prices. [Sandefur @ PLF; Flying J, Inc. v. van Hollen (7th Cir. 2010)]

Arthur Wolk v. Olson - Third Circuit update

As you may recall, the plaintiff in Wolk v. Olson immediately appealed the district court ruling dismissing his libel case. Plaintiff has asked the Third Circuit to certify questions of state law to the Pennsylvania Supreme Court; defendant-appellees, through their attorneys White & Williams and the Center for Individual Rights have filed an opposition to that motion. The appellees' brief is due November 5; amicus briefs in support of appellees are due November 12.

Ira Stoll and Jim Copland have discussed the outrageous Apple backdating lawsuit resulting in the outrageous Apple backdating settlement. The magnitude of the settlement compared to the original claims demonstrates that it is an extortionate nuisance settlement, being made because it would cost more to defend the suit than to pay the attorneys to go away.

But it should be noted: the settlement is not just outrageous, it is illegal. Under the Ninth Circuit's Six Mexican Growers precedent, a court should not be issuing cy pres that is not likely to benefit the class members. And as the Center for Class Action Fairness noted in recent Ninth Circuit briefing, the American Law Institute has said that cy pres is inappropriate where class members are readily identifiable. Given that the class attorneys are negotiating money for third parties instead of their own putative clients (for their own benefit, no less), there is also a breach of fiduciary duty that raises questions whether the class attorneys meet the Rule 23(a)(4) standard. The settlement is further problematic in that the vast majority of class members are entitled to zero compensation; it is far from clear that the sole lead plaintiff is a member of this subclass.

The Center for Class Action Fairness (which is not affiliated with the Manhattan Institute) would love to object to such a blatantly illegal settlement. But it can't do so in a vacuum: it can only do so on behalf of a class member who is being ripped off by these attorneys. Class members are those who bought Apple stock (AAPL) between August 24, 2001 and June 29, 2006—but only people who bought the stock between November 2005 and May 2006 are entitled to recover any money under the settlement, and their recovery is being diluted by the excessive demand for attorneys' fees and diversion to cy pres. We'd be happy to represent you pro bono if you agree that the settlement is objectionable and wish to object: please contact me. If you're not in the class, but know people or institutions who might be, spread the word.

The case is In re Apple Inc. Securities Litig., No. C-06-5208-JF (N.D. Cal.).

MI's Paul Howard and Jim Copland discuss Breusewitz v. Wyeth in the Examiner.

Around the web, October 21

  • Fifth Circuit: can't blame dredging companies for Hurricane Katrina damage. [Wajert; In Re: In the Matter of the Complaint of Great Lakes Dredge & Dock Co. LLC]
  • Ohio Court of Appeals: no class action against Best Buy for complying with state law in stove installation. The case was particularly egregious given that the "defrauded" lead plaintiff, who spent an extra $68 to come into compliance with state law, got a $75 gift certificate from Best Buy for his trouble. [Jackson]
  • Robbins Geller (which used to be Coughlin Stoia which used to be Lerach Coughlin) hires lobbyists to promote securities litigation in Dodd-Frank regulations. [BLT]
  • In West Virginia, feds not being fooled by Darrell McGraw creating slush funds with settlements when he was supposed to be reimbursing Medicare. [LNL]
  • Is the bisphenol A crisis "fiction"? [Goldberg @ Examiner]
  • Defense win for Novartis in New Jersey Aredia/Zometa jaw osteonecrosis case, even though plaintiff was a showcase plaintiff. [Drug and Device Law]
  • Democratic think tank Third Way opposes foreclosure moratorium. [via Zywicki @ Volokh]
  • NYCLU Title IX lawsuit squashes high-school soccer in NYC. [OL]

  • A review of the classic In re Hydrogen Peroxide class action certification decision. [Trask]
  • Indictment of Georgia federal judge on drug charges giving rise to challenges to his decisions, including by a vegan group that didn't get attorneys fees after the won only four dollars in a lawsuit. [AJC; WSJ Law Blog]
  • MI's Kay Hymowitz quoted on academia's rediscovery of the importance of culture in evaluating poverty. [NYT]

The U.S. Supreme Court on Wednesday, Oct. 13, heard oral arguments in Kasten v. Saint Gobain Performance Plastics, a case that has the potential to dramatically expand litigation under the Fair Labor Standards Act.

The National Association of Manufacturers, my employers, dislikes that possibility and has joined in an amicus brief in support of Saint Gobain. As our case summary explains, the lawsuit comes from an employee who orally complained about the placement of a time clock during a period of months in which he received discipline for time-clock violations. When he was terminated after the fourth offense, he sued his employer, alleging a violation of the anti-retaliation provision in the Fair Labor Standards Act. That provision makes it unlawful for an employer to terminate an employee because such employee has "filed any complaint . . .under the Act."

A transcript of the oral arguments, which featured discussion of the possibility of "filing" a complaint at a cocktail party, is online here. Is it a formal complaint is the employee has had one drink? Two? How about the supervisor?

The possible scenarios are rich: "Let me tell you, Mr. Johnson, hic, that I can't reach that, uh, uh, clock, yeah, the time clock, because it's over by the ladies room and that's too far, and you better shape up 'cause I've got a lawyer, hic...and, oh, oh, excuse me ......!"

News coverage ...


CEI's John Berlau and Professor J.W. Verret are critical of the forthcoming General Motors IPO because the prospectus warns that the government will assert sovereign immunity to claims brought under the securities laws.

This is the wrong way to look at it.

Recall that the claim of supporters of expansive securities litigation is that such securities litigation promotes faith in the marketplace. Coincidentally, this claim about faith is faith-based, as there is no empirical evidence that the marginal benefits of civil securities litigation (over and above existing criminal liability for intentional fraud) outweigh the costs to shareholders from paying lawyers for all the false negatives and extortionate settlements that shift wealth from one group of shareholders to another with a 25% carrying fee.

But when push comes to shove, the government, in deciding what is the best legal regime to maximize wealth from an initial public offering, chooses to assert sovereign immunity to avoid the expense of potential securities litigation. Nothing stops the government from waiving sovereign immunity (or, if the executive branch does not have the power, asking the Democratically-controlled Congress to do so) if it thought that the availability of civil litigation would increase the government's return on this IPO.

The question now becomes: why not allow other corporate entities to opt out of the expensive federal securities regulation? Let shareholders vote on the proposal at the same time as board of directors elections. Investor choice will dictate the result: shareholders who believe that they're better off in a world where lawyers get to waste executives' time with meritless lawsuits can invest in companies that announce that they're not opting out. The marketplace can decide which legal regime is better, and the academics will have nothing to argue about.

As a proponent of securities law reform, I'm willing to put up or shut up on this issue: I think investors will prefer a world where corporations take the same stance that the US government is taking in the General Motors IPO, and if the empirical evidence from this experiment proves me wrong, I'll change my mind and stop advocating for a change in the laws. The question is why supporters of the status quo aren't willing to empirically test whether shareholders would prefer the status quo.

Poetic justice dept.

The litigious Hunter Tylo is hit with a $885,000 abuse of process judgment after unsuccessfully suing a therapist who had treated her children.

(I may be looking for an abuse of process lawyer myself...)

As a connoisseur of hot-coffee cases, I'm always excited to see a court get one right. The Abnormal Use blog points us to Colbert v. Sonic Restaurants, No. 09-1423, 2010 WL 3769131 (W.D. La. Sept. 21, 2010). The plaintiff made the usual gamut of "design defect" and "failure to warn" claims, but the court wasn't buying it. Note that the plaintiff claimed to be injured by the coffee at Sonic Restaurants, yet another refutation of the trial-lawyer claim that Stella Liebeck's McDonald's coffee was unusually hot.

The DOJ Twitter feed

The Department of Justice has a Twitter feed that issues a tweet or two a day; you may or may not be surprised that there is not a single tweet between October 6 and October 18 that isn't entirely related to local crime issues—though there was one case involving a fatal 2008 beating of an illegal immigrant where the DOJ issued a press release for a successful federal conviction under the federal Fair Housing Act (!) with potential consequences of life in prison. Teenagers Brandon Piekarsky and Derrick Donchak, who had confronted 25-year-old Luis Ramirez and his 15-year-old girlfriend, had been acquitted of murder in state court, but sentenced to six to twenty-three months on lesser charges.

Around the web, October 19

  • Wouldn't you know, those foreclosure moratoria have effects on people other than people who haven't paid their mortgages. [WaPo]
  • The libertarian challenge to Obamacare. [Epstein]
  • Maryland high court upholds damages caps. [Fisher]
  • Paycheck Fairness Act will put small businesses out of business. [NLJ]
  • NY court rejects product-liability theory when no alternative design offered. [WLF]
  • Possible sanctions for lawyers who misrepresented facts to court in getting unconstitutional prior restraint on reporter in POM case. [NLJ]
  • A couple of Wisconsin attorneys are skeptical of civil Gideon proposals in that state. [Wisc. LJ; Petrie Stocking]
  • South Carolina high court to decide if "poker is a game of skill" loophole will permit home poker games without state interference. [Post and Courier]
  • Democrats' glass house on foreign money. [Hayward @ NRO]

From Der Spiegel, "After Rescue, The Fight for Compensation Begins":

Now that the 33 Chilean miners have been rescued, a top lawyer is preparing to sue for damages. He is unwilling to say how much he will ask for, but he expects it to be an open-and-shut case. In the meantime, he is waiting for things to calm down before he makes his first move.

The attorney is Edgardo Reinoso Lundstedt.

U.S. manufacturers produced some of the tools that aided in the rescue of the Chilean miners. One wonders whether U.S. lawyers will provide their expertise, as well.

Shortly after meeting with Reinoso, Mayor Gonzalez mentioned a sum. She felt that $1 million (€709,000) per miner would be suitable compensation. In Chile, damage suits function in much the same way as they do in the United States. Reinoso will be paid a percentage of the damage award. If he loses the case, he will have provided his services free of charge. But if he wins -- and Reinoso doesn't even take on cases he thinks he could lose -- he will be entitled to some of the money.

"How much will that be?" Reinoso smiles. "Oh, it's just money. Let's talk about art instead. Let's ignore all the fuss out there."

Yep, lots of similarities.

Cert grant in Ashcroft v. Al-Kidd

SCOTUSblog: "The Court limited its review of the new terrorism case (Ashcroft v. Al-Kidd, 10-98) to two issues: whether Ashcroft is entitled to absolute immunity in a case involving a detention under the federal 'material witness' law, and whether he is entitled at least to qualified immunity to a Fourth Amendment claim." The Court will not be reviewing the applicability of Iqbal to the case, even though the theory of Attorney General Ashcroft's liability was far removed from the line prosecutor who held the plaintiff for fifteen days as a material witness. Justice Kagan has recused herself from the case, so Ashcroft effectively starts down 1-0, since a 4-4 split is the same as a 5-4 loss. Earlier discussion of the Ninth Circuit ruling (598 F.3d 1129 (9th Cir. 2010)): Thornburg @ WLF; Samp @ WLF; Samp @ WLF.

Update: more from Orin Kerr.

The American Association for Justice has filed its 3rd Quarter lobbying disclosure form, reporting $940,000 in lobbying-related expenditures, down from $1 million in the 2nd Quarter.

One should always look for new areas in which the trial lawyer lobby has extended itself, and the Transportation category provides two, both new to us:

  • H.R. 6150 (no short title), to amend the limitation on liability for certain passenger rail accidents or incidents under section 28103 of title 49, United States Code, and for other purposes.
  • Lobbying with regard to consumer safety as it relates to cars with keyless ignitions.

H.R. 6150 was introduced on Sept. 19 by Rep. Elton Gallegly, a California Republican who announced the introduction in a news release, "Gallegly introduces bill to raise cap on rail accidents." The bill would raise the liability cap on certain rail accidents from $200 million to $500 million. From the release:

The higher cap would only apply in cases where the defendants are grossly negligent--a higher standard than under current law--and would apply retroactively to Sept. 12, 2008, the day a texting Metrolink engineer ran a red light, causing a collision with a Union Pacific train in Chatsworth, CA. Twenty-five people died and more than 150 were injured in that crash. Most of the victims were from Gallegly's congressional district.

"I met with many of the victims of the crash last month," Gallegly said. "Through no fault of their own, many now have injuries that will require a lifetime of medical treatment. Others lost a spouse or parent who was their primary means of support. The current cap will not even meet the medical needs of the survivors of one of the worst passenger train accidents in modern history. My bill is designed to address that."

Retroactive liability, eh? In any case, the bill has gone nowhere.

As for keyless ignitions, the litigation industry seems to have spotted this issue when casting a wide net against Toyota, suing over accidents supposedly caused by sudden acceleration. The AAJ's disclosure form lists the National Highway Traffic Safety Administration as agency it lobbied, along with Congress. Of course, the NHTSA's own investigations indicate that driver error -- stepping on the accelerator instead of the brake -- appears at blame for the accidents.

New York's chief judge, Jonathan Lippman, has been holding hearings on an expansive new idea: establishing a right to an attorney so that, courtesy of taxpayers, low-income New Yorkers can have free legal representation in a wide range of cases from evictions to divorces to job and welfare disputes and more. But such a program will not have the results Judge Lippman and other well-meaning advocates desire.

Read the whole thing. Unfortunately, the headline somewhat misstates my views: I don't oppose giving the poor free attorneys in all situations (as the oped itself makes clear), just the idea that there is a "right" to a free attorney at taxpayer expense in a civil case. More on the Lippman hearings: NY Daily News; WSJ; NYT. None of the press accounts have mentioned how one-sided the "hearings" are; show-trial rallies are more like it. More detail on my opposition to civil Gideon, plus my appearance at a CAP/ACS panel.

Pella v. Saltzman

In Pella v. Saltzman, the Seventh Circuit took a surprising view of the appropriateness of class certification. The defendants have petitioned for certiorari.

Last week, the National Association of Home Builders, Window and Door Manufacturers Association, the National Association of Manufacturers, the Chamber of Commerce of the United States of America, the American Architectural Manufacturers Association, and the Center for Class Action Fairness filed an amicus brief in support of the petition.

An argument that we did not make that I wish we did: when district court judges certify unworkable class actions, it's not just defendants who want to settle. Class attorneys don't want to force the case into an unworkable trial, either, because they risk decertification if the judge wakes up. And that hurts consumers, because the class attorneys then have every incentive to agree to a settlement that pays their fees while leaves the class in the cold. The only winners when a district court makes this sort of bad certification decision are the lawyers.

Around the web, October 17

  • Eleventh Circuit reverses itself in Cappuccitti v. DirecTV CAFA jurisdiction case. [Jackson; earlier @ POL]
  • Outrageous conduct by plaintiffs' attorney in Fosamax trial held to merit a $2500 sanction and a reduction in $8M award, but court lets liability determination by same prejudiced jury stand. I've previously complained about this odd view of "passion or prejudice" by some judges that pretends a jury to impassioned to come up with a legitimate damages award was somehow rational when it decided liability. And I'm sure an attorney in line for a $500-600k contingency fee isn't too upset about a $2500 sanction when the violation of the court order made the jury verdict possible in the first place. [Drug and Device Law; NYLJ; Boles v. Merck & Co. (S.D.N.Y. 2010)]

  • Against foreclosure moratoria. [Epstein]
  • SOX restrictions make preliminary earnings estimates more inaccurate. [Ribstein @ TOTM]
  • Summary judgment in Ford ignition-lock class action. [Wajert]
  • "Cell phones cannot cause cancer, because they do not emit enough energy to break the molecular bonds inside cells." [Scientific American; earlier @ POL]

  • Class action lawyers are going to try to get away with a $0 settlement by creating barriers to objecting. Unfortunately for them, I'm a class member. [CCAF]

Around the web, October 16

Justice Alito's Wriston Lecture

According to press releases from Senator Kirsten Gillibrand, the 9/11 Health Bill will bypass Senate committee hearings and be place on a "fast track":

In late September, the U.S. House of Representatives, with the bipartisan support of 17 Republican Representatives - voted to pass the James Zadroga 9/11 Health and Compensation Act. The bill was immediately sent to the U.S. Senate, where, at Senator Gillibrand's request, the Senate Majority Leader Harry Reid invoked Senate Rule 14 Process, which will fast track the bill to floor consideration, bypassing the much longer and uncertain committee consideration process that the vast majority of bills undergo.

Through the fast track process, the legislation will be added to the Senate's vote schedule shortly after the next legislative session resumes, on November 15th. Negotiations on the legislation will begin immediately, making it available for a floor vote at the start of the next Senate work period. While this process does not guarantee passage, it does remove obstacles including the committee process, which could stall the bill for months or it kill it before it is brought to the floor.

This is a well-meaning but bad idea, for reasons I explained in my March 31, 2009 testimony and answers to Rep. Sheila Jackson-Lee. Though I made several suggestions on how the bill could be improved to avoid what will be inevitable multi-billion-dollar fraud on the taxpayers, they were all ignored in the House. The bill also hurts America's ability to respond to future terrorist attacks by taxing innocent third-party volunteers' liability insurance for the benefit of trial lawyers—thus guaranteeing that any liability insurer worth its salt will refuse to insure contractors and subcontractors who volunteer to help in the aftermath of the next terrorist attack.

As if to demonstrate how the bill will be a huge source of fraud, the bill is named after James Zadroga, who died from injecting prescription drugs, but has somehow become a symbol of Ground Zero workers' health problems. Earlier.

Dear Tea Party candidates

If you're looking for examples of Supreme Court decisions to disagree with, feel free to consult with me, and I'll be happy to provide you a free white paper. But that should be done before you get asked the question.

Around the web, October 15

  • Paycheck Fairness Act broader than some of its proponents willing to admit. [Olson @ Cato]
  • Toyota moves to dismiss several dozen sudden-acceleration cases. [NLJ; NLJ]
  • Speaking of Toyota (and BP): What good is vindication after obliteration? [Dezenhall @ Daily Beast]
  • AP investigation shows that New York pays $96M/year to settle lawsuits against police; Chicago even more per capita. But the reporter doesn't quite seem to grok the concept of nuisance settlements. Peter Vallone is sponsoring a bill requiring the city to fight more cases. [AP/NYT via @walterolson]
  • Rare Rule 11 sanctions in securities lawsuit when lawyers bring implausible claim based on fundamental misunderstanding of purpose of hedging. [Fisher; American Lawyer @ yahoo.com]
  • A bipartisan piece: "Arbitration under siege" [NLJ]
  • More defense wins in Zyprexa litigation on learned intermediary and other grounds. [Drug and Device Law]

  • Breyer still doesn't have a coherent theory of constitutional interpretation. [Reason; and a good excuse to link to Michael McConnell in the Harv. L. Rev. (2006)]
  • Fifth Circuit nominee James E. Graves, Jr., isn't quite consistent in determining what is protected speech. [Volokh]

John Carney:

None of this excuses the actions of banks that falsified affidavits, did not properly transfer mortgage notes and lien documents, forged documents, and sold shoddily securitized mortgages to investors. But the wronged party in these situations is not the defaulting borrower--it's the investors in the banks, the courts, the buyers of the securities, and the broader American public.

It's actually a bit sickening to hear defaulted borrowers describing the misdeeds of banks as "mortgage fraud." What some banks have done might well be fraud--but the fact of that fraud doesn't erase the other fact that the borrower agreed to make payments or face the penalty of losing her home.

"These companies that are too big to fail apparently also think they're also too big to comply with the law of the land and it's beyond outrageous," D'Amelio's lawyer tells CNNMoney.

Maybe I've missed something here. Can someone please explain why banks being 'too big to fail' should mean that D'Amelio should get to live in a house she hasn't paid for?

Relatedly: Arnold Kling in the Washington Times calls for reform of our title system ("The real winners will be lawyers, whose eyes shine with the dollar signs of class-action lawsuits. In fact, as you read stories about the foreclosure scandal, you should realize that it is in the interest of lawyers to feed reporters the most lurid tales of improper behavior, the better to whip up public support for a settlement in the hundreds of millions of dollars, much of which will go to the litigators."), and a suit by purchasers of Countrywide mortgage-backed securities fails.

Update: and Walter Olson.

That auto bailout

Out of the Storm News rounds up some opinion on the GM and Chrysler bailout:

Ted Frank, adjunct fellow at the Manhattan Institute, sees more than an unpaid bill on the horizon. "The worst part of the bailouts was the way the administration used political threats to trample over established bankruptcy law and settled expectations," he says "In the long run, the bailout will cost far more jobs than it saves, even in the unlikely event that GM and Chrysler pay back the government in full."

Around the web, October 13

"A Read-the-Bill Rule for Congress"

Hanah Volokh:

In this Article, I argue that legislators have a duty to read the text of proposed legislation before voting to enact it. A Read the Bill political movement has formed in response to recent high-profile instances of rushed legislation. Putting aside partisan concerns, a rushed legislative process creates real problems because it forces legislators to vote on bills without having the time to properly evaluate the new legal rules that are being imposed on citizens. If a rule or norm of reading the bill can slow the legislative process enough to provide for thorough consideration of proposed legislation, it would bring a substantial benefit in the form of better laws. The rule would also draw the attention of legislators to their primary, fundamental role of making good law.

Google's robot cars

Robot cars have the potential to save thousands of lives and double highway capacity. But it's hard to imagine them ever becoming commercially available without some tremendous change in existing law. Current traffic laws require the technology to be able to be overridden by a human driver. And the American legal system's poor track record in sudden-acceleration cases suggests that trial lawyers and juries are often going to blame the technology and the deep pocket in the event of human error. Because a Google cannot collect millions of dollars for each of the lives they save through robot cars, but will be assessed that amount (in attorneys' fees alone) every time a driver of a robot car kills or injures someone, product-liability law may well make the roads far less safe in the short- to medium-term. Even if liability concerns merely delay the technology five years (and I think the effect will be larger than that), we're talking tens of thousands of lives that will be lost because of our current justice system.

Note that federal preemption comes into play here. Clear-cut federal regulatory standards that preempt state tort law could break the Gordian knot; but under trial lawyers' and the Obama administration's upside-down view of federalism, a single state's tort law could dictate the national marketplace for these vehicles. A manufacturer cannot be protected by one state's tort reform, because they're still potentially liable if a driver takes the vehicle into a different state with a more backward law. This problem that is only going to get worse if the Supreme Court adopts the Obama DOJ's position in Williamson v. Mazda Motor.

Appeal bond in Dewey v. VW

Trial lawyers often say that they care about access to justice, but that principle seems to go out the window when it comes to objectors to unfair class action settlements that might interfere with attorneys' fees.

In Dewey v. Volkswagen, currently pending on appeal in the Third Circuit (10-3618, consolidated with 10-3506, 10-3617, 10-3798, and cross-appeals 10-3651 and 10-3652), the plaintiffs' attorneys have asked for an oversized appeal bond explicitly to prevent the appeal from taking place.

Plaintiffs claim that such an appeal bond is necessary to prevent "extortion" on appeal, the problem where a "professional objector" seeks to hold up the payment of the settlement attorneys' fees with a meritless appeal in the hopes that the class attorney will pay some fraction of the time value of money to get the objector to drop the appeal.

The Center for Class Action Fairness took the plaintiffs at their word, and, in the Center's brief opposing the appeal bond, cross-moved for a different remedy: an injunction against extortionate settlements of the objection. Such an injunction, by requiring court approval of any withdrawal of the appeal, would do far more than an appeal bond to deter the attempt to settle a case for a quid pro quo payment to the objector without any benefit to the class. We suggested, however, that the plaintiffs' attorneys weren't really concerned about extortionate appeals (which permit them to escape appellate scrutiny at relatively low cost) so much as the fact of appeal.

Sure enough, the class counsel opposed the Center's cross-motion for injunction, though on remarkably flimsy grounds that insultingly presuppose a lack of intelligence on behalf of the magistrate; surely they don't expect that the judge will be confused by the difference between a merits injunction and an injunction regarding the conduct of the parties on appeal? You'll also note that the plaintiffs completely changed their theory behind the reasoning of the appeal bond without ever addressing the Center's arguments in their reply brief, but one hopes the district court isn't so easily fooled by sandbagging.

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

Political insider trading

As Congressional control over the economy grows, political actors can take advantage of their inside information in the stock market in anticipation of how political actions will affect the stock price. [WSJ via Adler @ Volokh; Bainbridge]

For years, I've wanted to write a piece rebutting the claims of the litigation lobby and academics who dispute the existence of the litigation explosion by relying on the misleading statistic that the number of cases have gone down. Lester Brickman has preempted me by noting the "large scale undercounting" that fails to account for mass torts and class actions consolidating thousands or millions of claims in a single lawsuit. For example, even as the number of tort lawsuits against New York declined between 1995 and 2004, the city doubled the amount it paid in settlements and judgments, and no doubt increased its litigation expenses as well.

Richard Nagareda

I am shocked and saddened at the sudden and untimely death of Vanderbilt Law Professor Richard Nagareda (1963-2010). Professor Nagareda, perhaps the leading scholar on mass torts and aggregate litigation, was a colleague on the Federalist Society Executive Committee; a co-panelist; and well-liked by all who knew him. Professor Nagareda was profilic; we frequently cited to him at Point of Law, including just last week, for his forthcoming paper on Wal-Mart v. Dukes. He was generous enough to contribute a column to Point of Law in 2008 on mass torts. [TortsProf; Vanderbilt]

Update: Drug and Device Law Blog.

As Ted Frank has reported elsewhere, he (thanks to his Center for Class Action Fairness) is my attorney in an objection I have filed to a proposed class action settlement.

The class, subscribers to Classmates.com, is to receive next to nothing in the settlement (the grand total distributed is just over $100,000). Plaintiffs' attorneys get just over $1,000,000 for this magnificent service -- a tidy 900% contingency. The class judge gets to distribute $500,000 to the charity of his choice -- is this a way of ensuring approval of the settlement? To object, four different letters must be posted -- the stamps themselves may cost more than any payoff for prospective objectors. Well, I (though my attorney) am objecting. Hopefully, my case will produce a new precedent precluding such abuse.

Around the web, October 10

  • Toyota settles the Mark Saylor crash caused by mis-installed floor mats that started the whole sudden acceleration panic. [WSJ]
  • Health Affairs study estimates cost of defensive medicine at $45.6 billion/year. [NYT]
  • "Dodd-Frank reform law invites new litigation opportunities against mortgage lenders," overturns Watters v. Wachovia. [LNL; Mayer Brown; Brooks @ Bloomberg]

  • "An Annoying Regulation for Every Room in the House" [CEI]
  • Campaign finance laws as weapons. [IJ]
  • E-discovery creates minefields for attorneys. [NLJ]
  • US$35M effort to "promote the use of Afghanistan's formal justice system" turns into self-parody. [NYT]

We missed this Niedermeyer post from July about the NHTSA-NRC panel on Toyotas and sudden acceleration, which nicely links to all 128 PowerPoint slides, but the only one you need look at is this age distribution chart, which nicely demonstrates what we've been saying all along, and would be even more pronounced if the denominator of "miles driven in a Toyota" were added to the equation.

Information on health-care lawsuits

The website Healthcarelawsuits.org has lots of links and information about litigation challenging the constitutionality of the recently enacted health-care-reform legislation. Included among the links: the Manhattan Institute's own must-hear podcast with Georgetown Law professor Randy Barnett, primary author of an amicus brief filed by the Cato Institute and Competitive Enterprise Institute.

At his must-read blog Future of Capitalism, Ira Stoll criticizes the securities class action settlement reached between New York City's retirement funds and Apple resolving litigation over the alleged backdating of Steve Jobs's stock options (see our earlier discussion of this litigation here, here, and here). Stoll has been all over this case since back when he was with The New York Sun (see also here).

However one views the merits of the underlying litigation, the $20.5 million settlement seems problematic -- including a $2.5 million cy pres award to twelve universities, which will doubtless raise the eyebrows of our editor. For fuller details on the settlement, see Stoll's post and the City's press release (PDF).

Around the web, October 7

  • Summary judgment granted to Nintendo over putative class action over wrist-straps and Wii controllers. [Wajert; Elvig v. Nintendo (D. Colo.)]
  • Ninth Circuit first court to enforce Rule 23(h) as written; courts are no longer permitted to require objectors to file objections to fee requests before the fee requests are submitted to the court. Seems obvious enough, but just had it happen to me in the District of New Jersey. [Trask; In re Mercury Interactive Corp. Sec. Lit.]
  • Beverly Stayart perhaps improves her Google footprint, and is now known for her meritless lawsuit against Yahoo over the search results she found when she searched for her name. [Stayart v. Yahoo! (7th Cir.) via Bashman]
  • DOJ's newfound racial bias in the Voting Rights section. [Thernstrom/Clegg @ NRO]
  • The academic dishonesty of Brad DeLong. [Adler @ Volokh; Ribstein]
  • SeaWorld lashes out at negligent-infliction-of-emotional-distress lawsuit filed over trainer killed by orca during performance; questions why parents "did not immediately remove their 10-year-old son from the [viewing] area as opposed to letting him witnesss 'much of what transpired' -- only to later subject him to media attention." [On Point]
  • Cyrus Sanai sanctioned, unapologetic. [Ninth Circuit via Bashman; Patterico (and see comment #26 and #27)]

The National Association of Manufacturers just released its congressional ratings for the 111th Congress, and noticeable by their absence are key votes on civil justice reform issues. In years past, high-priority pieces of tort reform legislation (think Class Action Fairness Act) were included the NAM's Key Vote Committee rankings, but in 2009-2010, no separate tort reform bills were rated.1 Neither did bills to expand liability reach the point of a floor vote.

We covered some of the flurry of legislative action in the last week before recess. Here's Part II, highlighting the inaction.

Legislation Congress Did Not Pass

  • The Medical Device Safety Act, meant to overturn the Supreme Court's decision in Riegel v. Medtronic. (H.R. 1346, S. 540)

  • The Motor Vehicle Safety Act, introduced as a reaction to the Toyota recalls. Turns out that truth - in this case, the reality of operator error - helped discourage passage of the expanded regulatory control and liability applied to automakers. (H.R. 5381)
  • Expansion of liability under maritime law proposed in the wake of the Deepwater Horizon accident.2 Here's a list of the 95 bills, resolutions and amendments introduced in the 111th Congress with the term "oil spill" in them.

  • The Discount Pricing Consumer Protection Act, S. 148, meant to overturn the U.S. Supreme Court's decision in Leegin Creative Leather Products, Inc. v. PSKS, which held that resale price maintenance agreements were not per se illegal under federal antitrust law. The bill by Sen. Herb Kohl (D-WI) was reported out of the Senate Judiciary Committee, however.

  • Bills sponsored by Sen. Arlen Specter (D-PA) and Rep. Artur Davis (D-AL) to allow trial lawyers to deduct expenses from contingency lawsuits. (S.437 and H.R.2519)

  • Sen. Specter's federal media shield legislation, with the potential to weaken protections of corporate trade secrets and confidential personnel records. (S. 448)

Yes, it is possible that Congress will act on some of these bills in the lame-duck session, which convenes Nov. 15. You would think that extending the tax 2001 rates would come first, but who knows what might happen? November promises to be an unsettled period full of recriminations and last gasps -- an environment that invites legislative excesses.

Perhaps Senators will give expression to their warm feelings of affection for Sen. Specter and pass all his bills as a final tribute. If the winds of change have been especially scouring, the litigation lobby may call on their congressional supporters to use their last opportunity to enact all sorts of liability-expanding legislation.

1 The NAM rated two bills in the area of employment law, the Lilly Ledbetter Fair Pay Act and the Paycheck Fairness Act. The first, which became law, removed statutes of limitation on employment discrimination suits. The second, which passed the House, lifts caps on punitive damages.

2 No legislation, plenty of litigation. The Washington Post today reports: "METAIRIE, LA. - The BP oil spill cleanup is winding down, but the lawyers are just warming up. The gusher of litigation might not be capped for years."

MI's Heather Mac Donald in the WSJ details a voter initiative permitting police to deal with aggressive homeless panhandling. San Francisco city government, which spends $175 million on homelessness services (compared to $442 million for police), had resisted any form of broken-windows policing, with predictable results. Mac Donald didn't have space to discuss the fact that the voter initiative will likely be tied up in the courts for years; as previously discussed in this space, the Ninth Circuit enjoined Los Angeles from any sort of legitimate policing of vagrancy in Jones v. Los Angeles.

The Veritas Initiative report studied 707 cases from 1997 to 2009 where California courts explicitly found prosecutorial misconduct, and only six of the prosecutors faced State Bar discipline. [National Law Journal]

Of course, it's important to recognize that a court finding of prosecutorial misconduct does not always equate to actual prosecutorial misconduct (just as a court finding of discovery abuse does not always mean discovery abuse occurred), but it's also true that many cases of prosecutorial misconduct are never discussed by courts. The lack of so much as a reprimand in many cases is appalling, especially given the higher ethical obligations of prosecutors. If the State Bar of California spent less time on lobbying and "diversity" and more time on its core functions, maybe there would be more discipline.

That said, the reports proposal to abolish absolute immunity for prosecutors is foolish, given the low bar for surviving demurrer in California. It's too easy to allege that an action was "intentional" or "with malice," and the cost of litigation would mean that good-faith prosecutors that only have qualified immunity would face expensive meritless lawsuits.

Thinking like non-lawyers

I'm honored that law professors Steven J. Johansen (Lewis & Clark) and Ian Gallagher (Syracuse) think that my analysis of Ernst v. Merck, the infamous (and later-reversed) $253 million Vioxx verdict, could have made a material difference if it had been adopted as part of the defense closing argument:

This verdict is bad news for all of us, and some of us will die prematurely because the lawsuit deterred the research and development of life-saving drugs.

And Vioxx was one such life-saving drug. The painkillers that it replaced (and is now replaced by) cause their own health problems, and current medical thinking is that, for at least some people, Vioxx would be a safer as well as a more effective pain-killer than aspirin, despite what we now know to be the latter's better cardioprotective profile. But Merck can't collect $26 million from each person whose life they save, even if it were possible to point to a particular Alvy Singer of Hypothetical City, Iowa, who didn't die of aspirin-related complications because he was taking Vioxx.

But I'm sad to say that I think they're wrong. Even if a judge permitted that sort of public-policy argument in a closing argument, it's a public policy argument, one aimed at lawmakers and judges, rather than finders of fact. It doesn't tell juries whether or not to find liability. Perhaps it's an argument against punitive damages, but a jury that already awarded such an unreasonably punitive sum of "compensatory" damages wasn't going to take its foot off the gas when given the opportunity to give a big punitive-damages award and be on Oprah just because it would be bad public policy. Even aside from the fact that Mark Lanier would've rebutted the argument by making up a new story that he's okay with Merck selling the drug if only they had "told the truth" (i.e., had perfect predictive powers about what future scientific studies would show about Vioxx's health risks), which is the same crocodile tears he cried when he was on "Stossel" a couple of weeks ago.

Merck didn't lose Ernst because a Williams & Connolly attorney didn't do a good job of storytelling; Merck lost because the jury was allowed to hear inadmissible evidence from an expert making an impermissible conclusory judgment without scientific basis that permitted the jury to come to the incorrect conclusion that the plaintiff had proved causation. (And that isn't even half of the unfair advantage plaintiffs had because of slanted evidentiary rulings at trial, an uncovered subject meriting its own post one day.)

The New York Times reports on a potential settlement of an antitrust suit against credit-card companies over interchange fees. Let's leave aside for the moment that the article does not even mention the reality that the suit and the settlement will make consumers worse off by discouraging the use of credit cards and making rewards programs untenable. Here's what's jaw-dropping:

Under the terms of the proposed settlement, merchants could offer consumers an immediate discount or rebate for using a particular type of payment, a particular credit card network (Visa versus American Express), or a low-cost card within that network (a Visa debit card rather than a Visa credit card). ...

The settlement, however, does not allow merchants to levy a surcharge on credit and debit payments beyond the cost of the transaction, as some merchants had sought.

Yes, you read that right. The Department of Justice is allowing merchants to offer a discount to customers who use cash. But merchants cannot impose a surcharge to customers who use credit cards. That'll protect the consumers!

Sen. Kirsten Gillibrand (D-NY) is holding a news conference today to talk about her plan to push H.R. 847, the James Zadroga 9/11 Health and Compensation Act, through the Senate. By a vote of 268-160, the House last week passed the bill to reopen the 9/11 Compensation Fund. From her media advisory:

U.S. Senator Kirsten Gillibrand, the Senate's chief sponsor of the James Zadroga 9/11 Health and Compensation Act, will work to bypass the Committee process and provide an opportunity for a full Senate vote when the Senate reconvenes next month. Nearly 16,000 responders and 2,700 community members are currently sick and receiving treatment. More than 40,000 responders are in medical monitoring and 71,000 individuals are enrolled in the WTC Health Registry.

On Monday, Senator Gillibrand will visit Long Island World Trade Center Program, a health care facility that provides assistance to many of the first responders and survivors who would directly benefit from passage of the James Zadroga 9/11 Health and Compensation Act. Senator Gillibrand will discuss her latest strategy to ensure this legislation receives the bipartisan support that will be needed to ensure the bill becomes a law.

Gillibrand's bill is S. 1334, on which a Senate Health, Education, Labor and Pensions Committee hearing was held last June. That bill now differs substantially from the House version that passed (with the Obama Administration's full support). The New York Daily News report, "Senate Democrats put Zadroga 9/11 health bill on fast track," notes the opposition to the bill from business groups, which criticize the bill's tax increase on foreign companies operating in the United States.

In last week's House debate, Rep. Charles Boustany (R-LA) include letters of opposition from the Organization For International Investment, the U.S. Chamber of Commerce, and the National Foreign Trade Council in The Congressional Record.

Seems like it would be a good idea -- at least in terms of accountability and representative government -- to hold a Senate hearing to further explore the tax increases as well as questions about funds going not to patients and medical care, but rather to trial lawyers.

The unhingedness of the latest Dahlia Lithwick column is best demonstrated by the fact that the very first case she and Barry Friedman single out as evidence of eeevil conservatives whittling away at our rights is a unanimous opinion with the pretty sensible reading of Miranda that police can re-question someone who waives his Miranda rights three years after the initial questioning if he's been given new Miranda warnings. Friedman and Lithwick are mystified that, though the Court has taken an ever-so-slight rightward turn (while Alito is to the right of O'Connor, Sotomayor is to the left of Souter), the public thinks the Court is still too liberal, though they miss the obvious explanation: the Court is still considerably to the left of the American public. As Brandon Bartels points out, even with the Court moving to the right, the majority of the last decade's "salient decisions"—decisions that made the front page of the New York Times—come out the way the Left would prefer. Throughout the article, when conservative justices reach liberal results, it's because the inherent correctness of the liberal result prevents conservatives from casting the votes they really want to; when liberal justices reach conservative results, it's because of the magic tricks conservatives play on the system. (And, of course, when conservative justices reach conservative results, it's because they're ignoring the law. So why don't they ignore the law when they reach liberal results? Friedman/Lithwick's fevered conspiracy theory has no predictive value.)

Relatedly, Orin Kerr detects some suspicious data-slicing in a New York Times assessment of Justice Breyer.

Update: See also Althouse and Blackman.

Around the web, October 4

What is it about fen-phen settlements and fraud? Ten former clients of Texas lawyer George Fleming allege that he assessed the $23 million cost of echocardiograms for 35,000 unsuccessful plaintiffs upon 8,100 other clients in a fen-phen settlement. "'He said he had worked too long and too hard for a lousy $41 million,' said Jim Doyle, who left the firm after objecting to Fleming's unusual decision to include non-client expenses among those billed to clients." [Houston Chronicle] It's unclear whether the clients are asking for complete disgorgement as a remedy for the alleged breach of fiduciary duty. For a similar case involving the late Texas attorney John O'Quinn, see Overlawyered.

Kate Zernike is mystified about this "rule of law" thing Tea Party activists talk about. (Scare quotes for "rule of law" and "property rights" are in the original article.) How soon they forget Scott Horton or Dahlia Lithwick or Tom Geoghegan or Philip Heymann or many others criticizing the Bush administration over its supposed disregard for the "rule of law." See also Stoll, Carney, Boudreaux.

Congress has departed Washington for the campaign season, returning November 15 (save for brief Senate pro forma sessions on Tuesdays and Fridays). As an update on the issues we follow around here, then:

Senate Majority Leader Harry Reid fiddled around with a cloture motion on S. 3772, the Paycheck Fairness Act, which means the bill could come to the Senate floor in November. Reid may just be trying to excite the activists and nothing will come of it, but Diana Furchtgott-Roth warns against the possibility in an Examiner column, "'Paycheck Fairness' an insult to women."

Legislating from pique, the Senate passed S. 2847, the Commercial Advertisement Loudness Mitigation Act, or CALM Act. The CRS summary: Directs the Federal Communications Commission (FCC) to prescribe a regulation limiting the volume of television advertisements that is limited to incorporating by reference the 'Recommended Practice: Techniques for Establishing and Maintaining Audio Loudness for Digital Television' insofar as such recommended practice concerns the transmission of commercial advertisements by a television broadcast station, cable operator, or other multichannel video programming distributor."

The Senate Judiciary Committee
postponed its business meeting scheduled for Thursday with the planned vote on the nomination of Robert Chatigny to serve on the Second Circuit Court of Appeals. Thanks to those pro forma sessions, Chatigny's nomination will not be returned to the President.

On a voice vote, the House approved
H.R. 1347, Concussion Treatment and Care Tools Act, establishing concussion management guidelines on prevention, identification, treatment, and management of concussions in school-aged children, including standards for student athletes to return to play after a concussion. Reaction from Michael V. Kaplen, a New York personal injury attorney who specializes in brain injuries.

In defense of Iqbal and Twombly

Twombly and Iqbal establish a modest pleading standard requiring a complaint to be "plausible." The legal and academic left has been up in arms over this. Beck asks the question I've been asking for a while. "Why should the legal system tolerate the filing of implausible complaints?" I'd recommend the excellent post even if it didn't cite my previous work.

Congress has departed Washington to campaign, and the American Association for Justice is claiming a limited victory. Note the prominence of preemption in its list of accomplishments from the AAJ's homepage, www.justice.org:

Members of Congress shut down early to devote the full month of October to the fall campaign.

AAJ advocacy efforts succeeded on many fronts, but health care reform, jobs and the stimulus package, and financial services reform pushed some of our issues into the background.

AAJ made progress despite a tough environment:

  • Fought off at least 25 Committee amendments to the Health Care bill to deny the rights of patients injured by medical negligence, and an amendment offered on the Senate floor capping lawyer fees;
  • Also defeated attempts to preempt state remedies in many bills introduced in both the House and Senate;
  • Worked to achieve broad elimination of Bush era preemption language from administrative rulemaking;
  • Helped assure that Chrysler and GM couldn't hide behind bankruptcy to deny compensation to future victims of potential negligence;
  • AAJ helped to protect certain employees from forced arbitration and worked to include language in the new Wall Street reform law giving the new Consumer Financial Protection Bureau and the Securities and Exchange Commission the power to limit the use of forced arbitration clauses in consumer and investment contracts. Attempts to strip these sections were defeated;
  • AAJ's efforts to draw public attention to the issue of forced arbitration led several large financial institutions to eliminate such provisions.

Still working on that tax break from Treasury, though.

For a more critical view of the litigation lobby's efforts directed at the White House, see David Freddoso's recent column in The Washington Examiner, "Trial lawyers will still have their best friend after November. Freddoso warns that President Obama might lift the executive order banning the federal government from hiring private attorneys on contingency to carry out its litigation.



Rafael Mangual
Project Manager,
Legal Policy

Manhattan Institute


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.