Results matching “bankrupt tort”

Garlock Ruling a Blow for Double Dippers - PointOfLaw Forum

Robert Panzenbeck
Legal Intern, Manhattan Institute's Center for Legal Policy

The Wall Street Journal notes a particularly interesting case out of federal bankruptcy court in North Carolina, where Judge Roy Hodges handed down a decision that strikes a blow against deceptive practices in asbestos litigation.

Garlock Sealing Technologies,a manufacturer of gaskets and packing,entered into bankruptcy in 2010 under the weight of pending and future asbestos claims. When manufacturers like Garlock file Chapter 11 in the face of asbestos claims, these firms are granted immunity on the condition that they meet a number of requirements. Among these requirements is the establishment of an asbestos trust, which establishes payments to be made to past and future victims based on the severity of their illness.

In this case, plaintiff's attorneys demanded that Garlock set aside 1.3 billion dollars for the settlement of mesothelioma related claims. Garlock believed the figure should be much lower, and earlier this month, federal judge Roy Hodges agreed, reducing their liability 90 percent, to 125 million dollars. This is significant, because for years, critics of this system have pointed out an exploitable information gap between the legal system and the trusts. In his opinion, Judge Hodges criticized the plaintiff's attorneys and their methods, noting that the larger number of 1.3 billion dollars was based on various forms of deceit by plaintiff's lawyers and clients, including the deliberate concealment of evidence that might suggest that plaintiff's injuries were the result of exposure to products other than Garlock's asbestos lined gaskets. The Journal notes one particularly poignant incident illustrating the extent of plaintiff misconduct:

Garlock had paid $9 million dollars in a California case involving a former Navy machinist mate. Garlock had attempted to show that the plaintiff had been exposed to asbestos-containing insulation, Unibestos, made by Pittsburgh Corning. The plaintiff denied exposure to insulation products, while his lawyer told the jury there was no Unibestos insulation on the ship. But Judge Hodges found that after the $9 million dollar verdict, the lawyers for the machinist filed 14 claims with other asbestos trusts, including several against insulation manufacturers. The same lawyers who told the Garlock jury there was no Unibestos exposure had claimed in the Pittsburgh Corning bankruptcy that the same plaintiff had been exposed to Unibestos. Judge Hodges wrote that the plaintiffs lawyers "failed to disclose" in court that their client had been exposed to 22 other asbestos products.

The Garlock case is a textbook instance of double dipping, a practice common in the asbestos litigation world. For years, critics of the system have alleged that plaintiff's attorneys "double dip," making claims to multiple asbestos trusts for the same injury. In this case, plaintiff's attorneys distorted or withheld facts while making claims with multiple asbestos trusts, even making allegations that were, as noted above, wholly inconsistent with the basis for rewards in prior decisions. As expected, companies forced into bankruptcy have decided to take action. Prior to this decision, EnPro Industries, Garlock's parent company, filed suit against four prominent asbestos law firms alleging they had concealed evidence about exposure to other products in litigation against Garlock. Judge Hodges' opinion provides significant ammunition for this claim.

The verdict is viewed as a major victory for Garlock, and is not without its critics. Paul Barrett of Bloomberg notes that the decision "obfuscates the long term wrongdoing by companies that didn't swiftly own up to the unintended harm caused by asbestos," while acknowledging that the circumstances present evidence that "influential members of the plaintiff's bar have lost their moral bearings."

It's not just companies like Garlock who have taken note. Congress, in an effort to solve the double dipping problem recently moved on the issue. In November, the House passed H.R. 982, the Furthering Asbestos Claim Transparency (FACT) Act, by a vote of 221 to 191. As BusinessWeek notes, the bill would require asbestos trusts around the country to file quarterly reports about who receives payments and how much they get. The bill is specifically designed to limit double dipping, and ensure that funds set aside for legitimate claims aren't unjustly dispersed to fraudulent claimants.

Protecting Proportionate Justice - PointOfLaw Forum

Vinny Sidhu
Legal Intern, Manhattan Institute's Center for Legal Policy

The purpose of allowing the people to petition their government for a redress of grievances is to ensure that those who have been wronged have the means to obtain compensation for the harm caused. Within this context, the debate over what constitutes "fair" compensation generally turns on two general considerations; namely, 1) whether the plaintiffs who seek a redress have legitimate claims and 2) if so, whether their accrued compensation is justified on the facts and circumstances of the case. Increasingly, the legislative and judicial systems have experienced burgeoning problems in dealing with the legitimacy of both factors.

To this end, Mark Behrens, Cary Silverman, and Christopher Appel of the legal firm Shook, Hardy, & Bacon L.L.P. have authored two important pieces. In terms of whether plaintiffs have legitimate claims, Behrens and Appel write in an op-ed for the National Law Journal that medical monitoring claims have increasingly been utilized by plaintiffs to try and obtain redress without the requisite injury-in-fact necessary to have standing. They laud courts that have attempted to restrict payments for injuries that may or may not occur, often at the expense of those truly harmed:

Suppose you have been exposed to a product that may increase your risk of a disease. You presently have no injury, but you are concerned that you could develop a disease in the future. Should the person who created the situation or made the product associated with the risk pay for you to obtain periodic medical testing?

Courts have come to different conclusions. Most courts over the past 20 years have said no to medical monitoring claims. Since 2000, these include the Supreme Courts of Alabama, Kentucky, Michigan, Mississippi, Nevada and Oregon. A few courts, however, recently have allowed medical monitoring claims in some situations, including the highest courts of Missouri in 2007, Massachusetts in 2009 and Maryland last year.

To the surprise of many in the plaintiffs' bar, a majority of New York's highest court recently joined the list of courts that have said no to medical monitoring for asymptomatic claimants. The New York Court of Appeals said that awarding medical monitoring to those individuals can threaten recoveries for the truly sick and lead to administrative nightmares and public policy judgments that are better left to the legislature.

The New York Court of Appeals reached the right conclusion. For over 200 years, one of the fundamental principles of tort law has been that a plaintiff cannot recover without proof of a physical injury. This bright-line rule may seem harsh in some cases, but it is the best filter courts have developed to prevent a flood of claims, provide faster access to courts for those with reliable and serious claims, and ensure that the sick will not have to compete with the nonsick for compensation.

As to the legitimacy of accrued compensation, Behrens, Silverman, and Appel write in the Wake Forest Law Review that courts are misrepresenting the ratio of actual or potential damage to punitive damages by including extra-compensatory damages that skew the ratio downwards, ostensibly making it seem valid:

Whether extracompensatory damages are considered in the ratio calculation has constitutional and practical significance. For example, if a jury awards a modest $50,000 in actual damages but $1 million in punitive damages, the resulting 20:1 ratio would far exceed the presumptive single-digit ratio limit expressed by the U.S. Supreme Court. But, if the court adds an additional $200,000 in attorney fees to the compensatory damages denominator, the double-digit ratio drops to 4:1 and is less constitutionally suspicious. Inclusion of prejudgment interest, which is set at statutory rates in some states that far exceed inflation, can have an even more significant effect on the constitutional calculus. For example, an Oklahoma appellate court upheld a $53.6 million punitive damage award where actual damages were $750,000; the award included $12.5 million in prejudgment interest to reach a 4:1 ratio. Without prejudgment interest, the 70:1 ratio between the punitive and actual harm damages should have led to a different result.

They theorize that the true ratios (minus the extra-compensatory damages) may be a presumptive violation of due process. If we accept these issues as inherently dangerous to the health of the judicial system, then there needs to be action taken in terms of mitigating the potential damage to defendants. If no action is taken, the chances of truly-deserving plaintiffs receiving compensation goes down and the administrative costs on the court and defendants go up. If defendants are then unable to cover the cost of legitimate claims, the result is no redress for the plaintiff and significant financial harm or bankruptcy for the defendant. It becomes self-evident, then, that if the scales of justice tip increasingly in favor of one party, both parties ultimately suffer.

By Richard A. Epstein

On Thursday, July 18, Texas Republican Congressman Jeb Hensarling will hold hearings on his "Protecting American Taxpayers & Homeowners Act." The PATH Act contains many forward looking proposals, on which I have no comment. But on this occasion, I want to focus on one key feature of the Act, which is only obliquely revealed by the statutory title. Mr. Hensarling shows great solicitude for American taxpayers and homeowners. But in a telling omission, he gives the back-of-the-hand treatment to the preferred and common shareholders of Fannie Mae and Freddie Mac, (commonly called Government Sponsored Entities or GSEs). In the interest of full disclosure, let me state for the record that I have advised several hedge funds on the merits of the PATH Act, and on the parallel bipartisan legislation that Tennessee Republican Senator Bob Corker called the Housing Finance Reform and Taxpayer Protection Act of 2013, both of which are designed to wind down the operations of Fannie and Freddie.

Liquidating Fannie and Freddie The source of my concern with Mr. Hensarling's proposed legislation involve sections 103 and 104 of the Act, which, according to its legislative summary provides for "Termination of Conservatorship," such that "Five years following the date of enactment mandates the appointment of the Federal Housing Finance Agency (FHFA) director to act as receiver for each Enterprise (i.e. Fannie Mae and Freddie Mac) and carry out receivership authority." Section 104 then provides for declining maximum amounts that GSEs shall be entitled to own over the five-year transitional period before these entities are liquidated.

In one sense, the demise of Fannie and Freddie should not be lamented, after the long and sorry history of massive government intervention in their internal affairs that created serious dislocations in the marketplace in 2008, including, most notably, the Congressional insistence in 2007 that Fannie and Freddie issue some $40 billion in subprime loans. As a result of these actions, both GSEs suffered major losses during the early part of 2008, not unlike those suffered by other private companies. The nature of these actions are outlined in a complaint attacking the various government actions filed in Washington Federal v. U.S. in June 2013.

Therein hangs the following tale, which leads to the Hensarling hearings. Although not widely known, both GSEs are as organized as corporations whose shares are privately owned and publicly traded. The independence of these corporations was effectively ended in July 2008 when Congress passed the Housing and Economic Recovery Act of 2008 (HERA), which forced both companies, while still solvent and flush with liquid assets that could be either sold or mortgaged, into a conservatorship that was overseen by an agent of the United States, FHFA. I have described much of the early operations of HERA in my Defining Ideas column Grand Theft Treasury. The title summarizes my deeply critical attitude toward this problem.

In September 2008, the FHFA, as conservator of these GSEs, entered into a deal with the United States Treasury to organize a bailout of these still solvent entities. First, FHFA issued to the Treasury a new 10 percent perpetual senior preferred stock for which Fannie and Freddie over time received in exchange about $187 billion in fresh capital. As part of the deal, the Treasury received warrants to purchase 79.9 percent of the common stock at a nominal price of $0.00001, effectively wiping out most of its value. The now junior preferred stock remained on the books but had sharply diminished value. Clearly, the net benefits from this initial bailout were set by the Treasury, which exercised its power to buy into these GSEs at prices highly favorable to itself. At no point did the former directors of either GSE have any say on the terms of the deal. Essentially, the United States was on both sides of the transaction in a clear breach of the standard rule that all self-dealing transactions must be scrutinized to determine whether the shareholders' conservator provide them with fair value.

The Dubious 2012 Amendments to the 2008 Agreement Fast forward now to August 2012, at the start of the housing market recovery. At this time, FHFA and the Treasury entered into their Third Amendment to the 2008 Agreement which provided that "all positive net income each quarter will be swept to the Treasury." It is important to understand the unprecedented magnitude of this Amendment. At the time, Fannie and Freddie had returned to profitability and were thus able to pay both the interest on the Treasury's senior preferred stock and return some of the $187 billion that the Treasury had contributed to the both GSEs. This Third Amendment in effect stripped all the cash out of these companies and gave it to the United States as a "dividend" on its investment, with no reduction in principal.

Any sensible person would instantly realize that the unilateral variation in terms was not done to aid the private shareholders of Fannie and Freddie, but was intended to transfer all their wealth to the government whose crude contractual "amendment" violates the first principle of contract law: A and B may never enter into a contract that binds C without C's consent. What is truly amazing is the spin that Mr. Hensarling puts on this so-called Amendment in a document described blandly as PATH Act Questions & Answers:

Some are arguing that Fannie and Freddie have begun paying a financial benefit to taxpayers. While it's true that both companies had positive net income for the last three quarters of 2012 and have made $65.2 billion in dividend payments, these statistics don't give a complete picture of their financial situation. It is important to note that under the GSEs' contact with the federal government, these dividend payments cannot be used to offset prior Treasury draw, so that regardless of how much is paid out in dividends, the GSEs still owe taxpayers $187 billion in bailout funds borrowed And since their contracts with the federal government state that all positive net income each quarter will be swept into the Treasury as a dividend payment, in their current state the GSEs will never be able to repay that debt to the taxpayers.
His "complete picture" of the financial deal is replete with half truths. It would help if Mr. Hensarling noted that he was speaking of the August 2012 Third Amended Agreement, which was signed only by two government operatives, then acting director Edward J. DeMarco of FHFA and Timothy Geithner, then Treasury Secretary. "Their contracts" with the federal government are not "their" contracts. They are just "contracts" that the government has entered into itself. The simple point here is that neither government agency represented the GSEs's shareholders who assets were stripped bare by government actions. Of course, the companies cannot pay back the debt because the government has seized all the assets that would allow that result to happen.

The Four Lawsuits It is no surprise that this highhanded action has attracted four major lawsuits in recent weeks. In addition to the Washington Mutual case, plaintiffs filed suits in Fairholme Funds, Inc. v. FHFA, (with Charles Cooper as lead counsel), Perry v. Lew(with Ted Olson as lead counsel) and Cacciapelle v. U.S., (with David Boies as lead counsel), attacking these sweetheart agreements and administrative shortcuts.Taken as a unit, these four lawsuits highlight three fatal flaws of the corrupt government deal of August 2012.

The first involves the blatant breach of the FHFA's duty of loyalty to the GSE shareholders, for whose sole benefit this arrangement was imposed. No fiduciary, government or private, may engage in collusive self-dealing that results in a huge one-sided giveaway of all corporate assets. FHFA is not exempt from this bedrock rule. Second, the Treasury's major abuse involves its conscious disregard of the explicit protections for GSEs built into Section 1117 of HERA. For starters, that section gives the Treasury only "temporary authority to purchase obligations and securities" up to December 31, 2009. That authority certainly did not allow the Treasury to engineer its one-sided 2012 sweep, except on the absurd premise that the statutory authorization to "buy" before 2010 implicitly authorizes outright government expropriation of GSE assets after 2009.

To be sure, the Treasury's temporary authority instructs it to "protect the taxpayer," and so it should be. But the phrase must be read in context. This instruction is meant to prevent the GSEs from ripping off the U.S. with one-sided deals. By no stretch of the imagination does that phrase authorize the U.S., in the name of taxpayers, to rip off GSE shareholders. Explicitly, HERA's statutory mandate only invites the Treasury to determine such financial matters as the maturity and risk of these notes, with the eye to making deals that allow for "the orderly resumption of private market funding or capital market access." However, the Treasury has not uttered a single syllable to explain why it's necessary to wipe out GSE shareholders by sleight of hand when ample funds are available to repay, with interest, the full $187 billion advance to these GSEs. Its brief public comment to date has echoed the point that it advanced $187 billion to Fannie, as it were, to maintain the solvency of both GSEs and protect the broader economy. The Treasury's email said "We fully believe our actions have been lawful and appropriate," without of course referring to the details of the Third Amended agreement. The normal tradition of judicial deference to administrative decision only applies to cases where there was reasoned elaboration before the government. It does not attach to imperial actions that are taken without public notice or comment or reasoned explanations.

Third, by stripping the GSEs of their assets by these verbal machinations, the Treasury and FHFA have taken the property of the shareholders--the corporate assets--without paying a dime in constitutionally required compensation. Remember, both Fannie and Freddie were solvent at the time of the August 2008 takeover, notwithstanding their previous run of losses. If the United States is allowed by fiat to throw solvent firms into government receivership, the Treasury's tortured logic would routinely allow the government to force any profitable corporation into receivership, thereafter to force a one-sided renegotiation of contracts that offers it huge dividends on nonexistent investments.

This logic holds even on the dubious assumption that that the GSEs got fair value for their perpetual 10 percent preferred stock. If so, proper accounting procedure requires the Treasury to first credit distributions to its 10 percent interest on the unpaid balance, using the remainder to pay down principal. By rough calculations, about $50 billion of the money paid to the Treasury should have paid down the debt, which would then decline from about $187 billion to approximately $137 billion. In effect, the desired remedy only requires courts to take the unexceptional position that the government cannot escape all of its fiduciary, statutory and constitutional obligations by re-labeling a return of capital as a dividend.

Ominous Long Term Implications The availability of a simple account fix to government overreaching lays bare the inexcusable workings of the Treasury's one-sided deals. Ironically, Mr. Hensarling's conscious effort to undermine property rights works at cross-purposes with his larger, laudable objective of trying to rid housing markets of their past, massive irregularities in order to encourage more private investment. What private fund will invest in projects when their cash can be siphoned off by dubious contractual liberties and administrative shortcuts that make a mockery of the rule of law? Why force hedge fund investors to bear losses created by a government money grab that wipes out all of the shareholders' legitimate anticipated returns? Prompt action is needed to stop Mr. Hensarling before his populist express gives us a rerun of the Chrysler and General Motors political bankruptcies about which I have written elsewhere. But if courts don't invalidate the government's contractual gimmicks and administrative shortcuts, this is exactly what will happen.

Richard A. Epstein is a professor of law at NYU Law School, a Senior Fellow at the Hoover Institution, a Senior Lecturer at the University of Chicago and a visiting scholar with the Manhattan Institute's Center for Legal Policy. His forthcoming book is "The Classical Liberal Constitution," from Harvard University Press in 2013. He has consulted for several hedge funds not involved in the ongoing litigation on the issues discussed in this Op-Ed.

On Thursday, July 18, Texas Republican Congressman Jeb Hensarling will hold hearings on his "Protecting American Taxpayers & Homeowners Act." The PATH Act contains many forward looking proposals, on which I have no comment. But on this occasion, I want to focus on one key feature of the Act, which is only obliquely revealed by the statutory title. Mr. Hensarling shows great solicitude for American taxpayers and homeowners. But in a telling omission, he gives the back-of-the-hand treatment to the preferred and common shareholders of Fannie Mae and Freddie Mac, (commonly called Government Sponsored Entities or GSEs). In the interest of full disclosure, let me state for the record that I have advised several hedge funds on the merits of the PATH Act, and on the parallel bipartisan legislation that Tennessee Republican Senator Bob Corker called the Housing Finance Reform and Taxpayer Protection Act of 2013, both of which are designed to wind down the operations of Fannie and Freddie.

Liquidating Fannie and Freddie The source of my concern with Mr. Hensarling's proposed legislation involve sections 103 and 104 of the Act, which, according to its legislative summary provides for "Termination of Conservatorship," such that "Five years following the date of enactment mandates the appointment of the Federal Housing Finance Agency (FHFA) director to act as receiver for each Enterprise (i.e. Fannie Mae and Freddie Mac) and carry out receivership authority." Section 104 then provides for declining maximum amounts that GSEs shall be entitled to own over the five-year transitional period before these entities are liquidated.

In one sense, the demise of Fannie and Freddie should not be lamented, after the long and sorry history of massive government intervention in their internal affairs that created serious dislocations in the marketplace in 2008, including, most notably, the Congressional insistence in 2007 that Fannie and Freddie issue some $40 billion in subprime loans. As a result of these actions, both GSEs suffered major losses during the early part of 2008, not unlike those suffered by other private companies. The nature of these actions are outlined in a complaint attacking the various government actions filed in Washington Federal v. U.S. in June 2013.

Wherein Max Kennerly attacks a strawman - PointOfLaw Forum

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.

Medical malpractice reform in New Hampshire - PointOfLaw Forum

Jarrett Dieterle
Legal Intern, Manhattan Institute's Center for Legal Policy

Recently the New Hampshire legislature voted to override the veto of Gov. John Lynch and enact an "early offer" system for medical malpractice cases. As Walter Olson describes, the law incentivizes "defendants to make offers early in the litigation process that cover plaintiff's economic losses such as medical bills and lost wages." The plaintiffs can then choose whether to accept the early offer from the defendant doctor or continue to litigate the case. According to Section XII of the statute, if the plaintiff ultimately does not prevail, a form of "loser pays" takes effect:

XII. A claimant who rejects an early offer and who does not prevail in an action for medical injury against the medical care provider by being awarded at least 125 percent of the early offer amount, shall be responsible for paying the medical care provider's reasonable attorney's fees and costs incurred in the proceedings under this chapter.

In addition to being advantageous for the doctors as defendants, "early offer" also can benefit the claimants in certain situations:

Early offers allows, but does not force, a claimant to bypass the tort system. Tort law has virtues, but among them are not certainty and swiftness. Because of an understandable focus on individual justice, the tort system can be very uncertain and slow, with significant transaction costs. There are many claimants who would prefer to have their claims resolved along insurance principles--with more certain payment for economic loss, taking care of the their urgent needs. I have sat at the hospital bed of a catastrophically injured loved one. After his health, my main concern was that he not be bankrupted by the enormous costs of life-saving care.

New Hampshire is the first state in the country to enact an "early offer" system. Given its benefits for doctors and patients, maybe more states will choose to follow the Granite State's lead.

Better Scholarship Through Diversity? - PointOfLaw Featured Discussion

Walter K. Olson

Little-known fact: Harvard lawprof Elizabeth Warren once gave a speech to a Manhattan Institute luncheon crowd on the topic of asbestos bankruptcy trusts. As I recall, she gave a deft account of this abstruse but important subject, and I much doubt it would have improved anything had the Institute asked her to address the topic from the special vantage point of a female scholar. Much less did anyone imagine that Warren might bring some special insight to bear from her family tradition of remote Cherokee lineage, which has lately furnished so much grist for critics.
For many readers, the Warren-as-Cherokee brouhaha has been their first close look at the matrix of identity politics in which law schools operate. When HLS administrators began to claim Warren as a minority hire, they were under intense pressure for not having any female minority professors. These days, the relevant pressure is likely to take the form not so much of student occupiers but of relentlessly screw-turning accreditation agencies, a process well described by Gail Heriot.

Is this a mere identity spoils system, or does it amount to something nobler and more high-minded? The strong claim I want to focus on here is that diversity hiring improves the quality of scholarship in the traditional law curriculum by bringing distinctive minority insights that straight white Anglo abled males would not or could not have contributed. (I will leave for another post the question of how it might influence scholarly development on topics that do relate to identity, such as discrimination law.)

There's no definitive way to resolve this claim, I suppose, without agreeing on how to evaluate the now-vast literature advancing (e.g.) feminist approaches to torts, the "queering" of intellectual property law, and so on. I can only say that I must not be reading the right papers in this genre, because the papers I've read haven't impressed me. Given that criticizing identity-studies literature seems to be a good way to get fired from one's writing gig, I'd better stop there.

To me, time has vindicated the basic position staked out by Stephen Carter of Yale in his Reflections of an Affirmative Action Baby. Carter writes of the "Dear Minority Colleague" letters presuming he holds correct views on various topics, and the resentment aimed at minority faculty like himself who choose to specialize in scholarly topics having little or nothing to do with identity. Twenty years later it remains true that many of the minority lawprofs to have made the biggest impact on the outside world have been those who've largely avoided identity themes in their intellectual work, such as Carter himself and Stanford's William Gould, to whose number might be added Elizabeth Warren (to the extent she counts as minority) and Chicago's Barack Obama.

As I put it in reviewing Carter's book: "It doesn't take a white or a black mind to explode a fallacy: it takes a mind."

CJD still lying about hot coffee - PointOfLaw Forum

Litigation-lobby front Center for Justice and Democracy is still falsely claiming that McDonald's "coffee was as hot as a car radiator." As we've previously noted, "A car radiator temperature, between chemical coolants and pressurization, is between 195 and 225 degrees Fahrenheit. Stella Liebeck's coffee was between 170 and 180 degrees, and would rapidly cool when exposed to room temperature."

Note also the humor in CJD's use of the passive voice: Liebeck was injured when "McDonald's coffee spilled in her lap." Well, who could complain about a lawsuit where coffee magically spilled itself? Oh, Stella Liebeck spilled the coffee on herself? Gee, that would seem a fact relevant to the assignation of proximate causation when evaluating whether it's appropriate to criticize a court that allowed this case to get to a jury, unlike over 90% of other courts that have dealt with cases similarly claiming that hot coffee was a "defective product."

Liebeck's injuries came from dumping an entire cup of coffee in her own lap while sitting in a car without a cup-holder, and then sitting in that hot coffee for well over a minute while wearing absorbent clothing. As Liebeck's own lawyer claimed, any coffee hotter than 140 degrees would be "unsafe" in those conditions. Unless you wish juries to have the power to punish vendors like McDonald's and Starbucks and Dunkin Donuts and everyone else that commercially sells coffee, that's no more McDonald's fault than it is Liebeck's auto manufacturer or sweatpants manufacturer.

That CJD and Susan Saladoff single out the poster child of abusive litigation as the point of attack on the tort reform movement—without ever fairly addressing the actual arguments tort reformers make—shows the bankruptcy of that attack.

Update, January 27: Welcome, readers of the dishonest "Pop Tort" blog. Note how they cherry-pick a couple of websites that say that radiator temperatures are 190 degrees. Of course, 190 degrees is hotter than Stella Liebeck's coffee (which, even if was "held" at 190 degrees, which there was no evidence of, would rapidly drop in temperature as soon as it stopped being held at that temperature); moreover, most websites give much higher temperatures for car radiators: "Most engines today are designed to operate within a "normal" temperature range of about 195 to 220 degrees F"; (same); many thermostats are set at 195 degrees for car radiators, etc. The only reason to use the "car radiator" analogy is to mislead. At best, a car radiator has such a wide range of temperatures that it is meaningless to use the analogy; if you're saying that Stella Liebeck's coffee is as "hot as a car radiator" because you're claiming that car radiators are 160 degrees, well, Starbucks and Dunkin Donuts and McDonald's and Burger King and Wendy's and Caribou Coffee and 7-Eleven and Cosi are selling coffee today that's hotter than 160 degrees—much less the 140 degrees that Stella Liebeck's lawyer claims makes coffee "unreasonably dangerous."

Note further how Pop Tort makes up a brand new theory of liability for McDonald's—that the cups were not capable of holding hot coffee—that not even Stella Liebeck's lawyer had the chutzpah to argue. Of course, there's no evidence for the proposition that McDonald's was selling coffee in cups that would collapse if "poked by a finger"; if they were, then the rate of injury from coffee spills would be far higher than 1-in-23-million cups (i.e., several times less likely than being struck by lightning).

Note further that CJD still has no answers for the actual arguments tort reformers make against the Liebeck verdict and the judge's erroneous legal decision to let the case get to a jury. Instead, all their website offers is ignorant snark. The question remains: if CJD is in the right, why can't they simply address the issues? Their reliance on dishonest arguments and misleading non sequiturs seems to be part of their business model.

In the mid-1960s, Lt. Patrick O'Neil served on the USS Oriskany, a 1940s-era aircraft carrier. O'Neil's work in the boiler-room exposed him to asbestos insulation manufactured by Johns Manville, and, decades later, he contracted mesothelioma. O'Neil isn't allowed to sue the Navy; Johns Manville is bankrupt from previous asbestos litigation. So O'Neil sued innocent third parties that happened to sell products to the Navy that didn't contain asbestos on the theory that they should have warned users about the risks of asbestos from other products that might be used in conjunction with their harmless products. O'Neil also sued a company that sold a part in 1943 that did contain asbestos (pursuant to Navy requirements), but whose asbestos components had been replaced by the time O'Neil encountered them.

Fortunately, in last week's O'Neil v. Crane, the California Supreme Court unanimously rejected this attempt to expand tort law beyond all moorings. When "the consequences of a negligent act must be limited to avoid an intolerable burden on society, policy considerations may dictate a cause of action should not be sanctioned no matter how foreseeable the risk." Unfortunately, in the absence of federal law on the subject, this means that future plaintiffs are simply going to forum-shop their asbestos litigation to other states that have not so dispositively rejected such expansive theories, so innocent manufacturers who happened to sell products to the Navy are not going to be off the hook yet. But good precedent is good precedent, and it's important that the California Supreme Court is willing to acknowledge that the fact that there are some injured plaintiffs who don't have recovery does not require courts to invent theories to permit collection from distant defendants. And as Beck points out, the decision has consequences for intermediate California courts that have held that pharmaceutical manufacturers can be held liable for the sales of similar products by generic manufacturers. [Jackson; Beck; Wajert; PLF; PLF amicus; Stier; Cal Biz Lit via @walterolson; LNL; Recorder/; Ruskin]

Masthead - PointOfLaw Forum


Ted Frank

Ted Frank is an Adjunct Fellow with the Center for Legal Policy at the Manhattan Institute. The Wall Street Journal has called him a "leading tort-reform advocate."

In addition to his role with the Manhattan Institute, Mr. Frank is the president of the Center for Class Action Fairness, which he founded in 2009. Mr. Frank has written for law reviews, the Wall Street Journal, the Washington Post, and The American Spectator and has testified before Congress multiple times on legal issues. He also writes for the legal blog and serves on the Executive Committee of the Federalist Society Litigation Practice Group. In 2008, Mr. Frank was elected to membership in the American Law Institute.

Previously, Mr. Frank clerked for the Honorable Frank H. Easterbrook on the Seventh Circuit Court of Appeals, was a litigator for ten years, served as the first director of the AEI Legal Center for the Public Interest, and was an attorney on the McCain-Palin 2008 campaign. Mr. Frank graduated the University of Chicago Law School with high honors and as a member of the Order of the Coif and the Law Review.

  Articles by Ted Frank


James R. Copland

Jim Copland is the director of the Center for Legal Policy at the Manhattan Institute. Under Mr. Copland's stewardship, the Center has published recent work on asbestos, class actions, and "toxic mold" litigation. The Center's 2003 report, Trial Lawyers, Inc.: A Report on the Lawsuit Industry in America, received favorable press attention on various television news channels, radio programs, and print sources including The Economist and The Wall Street Journal.

  Articles by James R. Copland


Marie Gryphon

Marie Gryphon is a Senior Fellow with the Center for Legal Policy. As an attorney in private practice, she worked on ERISA, securities, class action, commercial contract, legal malpractice, and constitutional law cases. She has also been a legal and policy analyst with the Cato Institute, working on issues related to education policy. Her articles have appeared in Business Week, the Washington Post, the Dallas Morning News, the Star-Ledger, Forbes,, National Review Online, and the Orange County Register. She holds a J.D. from the University of Washington School of Law and is a Ph.D. candidate in public policy at Harvard University.

Paul F. Enzinna

Paul F. Enzinna is a member of the White Collar Defense and Government Investigations Group at Brown Rudnick, LLP in Washington, DC. He represents individuals and corporations in internal and grand jury investigations, and at trial and on appeal. He has represented several death row inmates, and is a member of the Board of Directors of the Mid-Atlantic Innocence Project. In 2002, he was awarded the R. Kenneth Mundy Lawyer of the Year Award by the National Association of Criminal Defense Lawyers' District of Columbia chapter for his work in obtaining a full pardon, on the basis of DNA testing, for a Virginia man sentenced to more than 200 years imprisonment for rape.

Michael Krauss

Michael Krauss, a professor at the George Mason School of Law, is nationally known for his research in torts and legal ethics. He is a leading scholar of the government "recoupment" lawsuits against the tobacco and gun industries, and he recently co-authored the second edition of Legal Ethics in a Nutshell.

Walter K. Olson

Walter Olson is a Senior Fellow with the Cato Institute, a commentator, author, and critic best known for his work on the American litigation system. He has written three widely acclaimed books on the American litigation system: The Litigation Explosion, The Excuse Factory, and The Rule of Lawyers. His writing appears regularly in such publications as the Wall Street Journal and New York Times, and he writes a regular column on American law for the Times Online (U.K.). His approximately 400 broadcast appearances include "Crossfire", the "Lehrer News Hour", CNN "NewsNight", and "Oprah". He founded and continues to run the popular weblog. He has frequently given testimony before lawmakers and advised public officials; the Washington Post has dubbed him an "intellectual guru of tort reform."

Hester Peirce

Hester Peirce is a senior research fellow at the Mercatus Center at George Mason University. Peirce's primary research interests relate to the regulation of the financial markets.

Hester Peirce served as Senior Counsel to Senator Shelby's staff on the Senate Committee on Banking, Housing, and Urban Affairs. In that position, she worked on financial regulatory reform efforts following the financial crisis of 2008 and oversight of the regulatory implementation of the Dodd-Frank Act. Among the issues Peirce focused on were derivatives regulation, the use of economic analysis in the development of financial regulations, the regulation of investment advisers and broker-dealers, corporate governance, and the regulation of credit rating agencies. Her oversight work on the Banking Committee focused primarily on the activities of the Securities and Exchange Commission, the Commodity Futures Trading Commission, the Financial Stability Oversight Council, the Financial Industry Regulatory Authority, and the Public Company Accounting Oversight Board.

Jonathan B. Wilson

A seasoned business attorney, Jonathan B. Wilson has experience in corporate, securities, technology, and intellectual property law. He currently practices with the Atlanta firm of Taylor English Duma, LLP and is the former general counsel of two NASDAQ companies. He founded and chairs the American Bar Association's Renewable Energy Committee and in 2005 penned, Out of Balance: Prescriptions for Reforming the American Litigation System, outlining his ideas for legal reform.

Carter Wood

Carter Wood is a speechwriter for Business Roundtable in Washington, D.C., a trade association representing chief executive officers of leading U.S. companies. He previously spent five years as Senior Communications Advisor with the National Association of Manufacturers, where he wrote the blog, A former newspaper reporter in Oregon and North Dakota, Wood served as policy advisor for two governors of North Dakota, a speechwriter for Secretary of Health and Human Services Tommy G. Thompson, a special assistant in the Federal Housing Finance Board, and a D.C. lobbyist for the governor of Indiana. Wood holds a B.S. in history from Reed College and an M.S.J. from the Columbia School of Journalism, New York City.


David Bernstein

A professor at the George Mason University School of Law, David Bernstein is a scholar of wide-ranging interests, including torts, products liability, and scientific and expert evidence. He is co-author of the most extensive treatise to date on expert evidence and co-editor of Phantom Risk: Scientific Inference and the Law. Professor Bernstein is also a contributor to the popular weblog, The Volokh Conspiracy.

Lester Brickman

Lester Brickman is a professor of law at the Benjamin N. Cardozo School of Law at Yeshiva University. His areas of expertise include administrative alternatives to mass tort litigation, asbestos litigation, and contingency fee reform. Professor Brickman has written extensively on these and other topics, he has testified at congressional hearings, and he is widely quoted in the press.

Michael DeBow

A professor at both the Cumberland School of Law at Samford University and the School of Public Health at the University of Alabama at Birmingham, Michael DeBow is a leading researcher on the states' lawsuits against the tobacco companies, judicial selection mechanisms, and the politics of legal reform. He also contributes to the weblog Southern Appeal.

Richard Epstein

The James Parker Hall Distinguished Service Professor of Law at the University of Chicago and the Peter and Kirstin Bedford Senior Fellow at the Hoover Institution, Richard Epstein is one of the most nation's most prolific legal scholars, with writings spanning almost every area of private law. He authored his first book on tort law almost 25 years ago, and he is editor of one of the leading torts casebooks.

Martin Grace

Martin Grace is a professor of risk management and insurance at Georgia State University, as well as the associate director of the school's Center for Risk Management and Insurance Research and an associate of the school's Fiscal Research Center. He also has his own blog on tort law, liability, and insurance, RiskProf.

Philip K. Howard

Phil Howard is the vice-chairman of Covington & Burling and the author of two best-selling books on lawsuit abuse, The Death of Common Sense: How Law is Suffocating America and The Collapse of the Common Good: How America's Lawsuit Culture Undermines Our Freedom. He has contributed the American Law section of the Oxford Companion to American Law for nearly 40 years. More recently, Howard has served as founder and chair of the bipartisan legal reform coalition Common Good, which advocates holistic changes to the tort system.

Daniel P. Kessler

An expert on health care management and medical malpractice reform, Daniel Kessler is a professor at Stanford Business School and Stanford Law School and a senior fellow at the Hoover Institution. His seminal work with Mark McClellan has quantified the effects of medical malpractice liability rules on medical practice. Professor Kessler continues to publish on health care policy, industrial organization, antitrust, and other issues in law and economics journals.

Tom Kirkendall

Tom Kirkendall, a prominent Houston lawyer, opened his own practice in 2002 after twenty years at Maddox, Perrin & Kirkendall, a business litigation firm he helped found in 1981. His areas of expertise include securities law, bankruptcy, and corporate reorganization. He writes the popular blog Houston's Clear Thinkers.

Stephen Presser

Stephen Presser, professor at Northwestern Law School and School of Management, is one of the leading scholars in the field of corporations, particularly on the issue of shareholder liability for corporate debts. He has authored a leading casebook in the field, An Introduction to the Law of Business Organizations. He is also considered an expert in legal history and constitutional law, a title he has earned as editor of the preeminent legal history casebook, as author of the compelling originalist treatise Recapturing the Constitution, and as a regular expert witness to the U.S. Congress on constitutional law issues.

Alexander Tabarrok

Alex Tabarrok is a professor of economics at George Mason University, research director at the Independent Institute, and a research fellow at the Mercatus Center. Along with Eric Helland, he has conducted much of the leading empirical work of the last decade on the law and economics of tort, including research on the effects of judicial election and selection systems on tort awards. Professor Tabarrok co-authors the law and economics weblog, one of the most widely read economics blogs on the internet, as well as the extensive FDA policies and reform website


Once the subject of an inspiring tale of recovery in the context of civil justice reform, Madison County, Illinois has found itself yet again featured in the American Tort Reform Association's annual 'Judicial Hellholes' report. Ranked fifth on ATRA's list, Madison County has unfortunately reclaimed its reputation as the nation's "epicenter" for asbestos litigation.

ATRA's report cites some alarming statistics:

In 2003, asbestos filings in the county peaked at 953. After Judicial Hellholes reporting spurred public scrutiny of the magnet jurisdiction, judges became more serious about transferring cases that belonged in other areas. By 2006, asbestos filings in Madison County reached a low point of 325. Since then, however, the number of such filings has increased each year to 455 in 2007, 639 in 2008, 814 in 2009, and 840 in 2010, as documented by Illinois Lawsuit Abuse Watch (I-LAW). Only about 1 in 10 of Madison County's asbestos cases are filed by people who actually live or work there, or have any other connection to the area, according to an Illinois Civil Justice League study. According to one local defense lawyer, asbestos claims account for nearly 60 percent of Madison County suits seeking more than $50,000, eclipsing the claims of local residents.

Defendant companies and other legal observers note that plaintiffs' lawyers flock to Madison County because the court sets aside about 500 trial dates for asbestos cases. The trial dates provide a steady stream of business for favored local law firms, with whom out-of-state lawyers must work to pursue their cases. Defendants are placed at a disadvantage given the expedited treatment of cases and the power given to plaintiffs' lawyers to set the trial schedule. Because defendants may not know which cases will go to trial until the last minute, they often prepare for multiple cases simultaneously, pay for expert reports they do not need, and must travel across the United States to take depositions.

As if in anticipation of ATRA's report, only days before the release of 'Judicial Hellholes', news broke that Circuit Judge Barbara Crowder of Madison County, assigned to oversee the circuit court's asbestos docket, was to be removed to civil assignments. Chief Judge Ann Callis filed the order after discovering that attorneys of three plaintiffs' firms donated, in sum, $30,000 to Judge Crowder's campaign fund only a few days subsequent to being chosen by Judge Crowder to receive a majority of the trial slots on the 2013 asbestos docket.

Judge Crowder denied a connection between the donations and her "activities on the bench", but, there was no denying the appearance of impropriety especially in light of Madison County's notoriety with regard to asbestos litigation. Lisa A. Rickard, president of the U.S. Chamber Institute for Legal Reform, called on the court to "fix the fundamental flaw of Madison County's asbestos docket calendar system that in effect puts court time up for sale."

The Chamber's Institute for Legal Reform called for this and more in a report in 2010 focusing solely on reforming Madison County's warped asbestos litigation system, concluding even then:

The solution to this problem is simple: apply the law as written. If venue rules are enforced, fair procedures for trial allocation and scheduling adopted, discovery of the bankruptcy trusts provided and the Lipke rule regarding alternative cause implemented as mandated by the Illinois Supreme Court, the jurisdiction would return to normal and appropriate operations.

It was hoped that Judge Crowder would clean up the asbestos litigation abuse mess when she took over last year, however, it seems that fundamental procedural changes have to be implemented to effectively repair Madison County's civil justice system.

Around the web, June 13 - PointOfLaw Forum

  • More on the overcriminalization issues in the GSK in-house counsel Lauren Stevens criminal case. The FDA Law Blog, in particular, singles out the problem of regulating off-label use through criminal prosecution; Judge Titus took a decidedly different view on the legalities of the practice than the government. [FDA Law blog; Olson @ Cato; Main Justice;; earlier on POL]

  • Engage review of Lester Brickman's must-read Lawyer Barons. [Little via OL]

  • Warms the cockles of my heart: layperson hipster successfully battles hedge-fund conflict of interest in bankruptcy hearing. Bondholders tried to "gerrymander" an impaired class of securities to approve a reorganization plan to freeze them (and other securities holders) out to the benefit of bondholders. [CCAF; WSJ (h/t L.O.); Thoma objection; In re Washington Mutual, Inc., 442 BR 314 (Bankr. D. Del. 2011)]
  • Dallas Fed chair touts role of tort reform in Texas job growth. [CNBC via CJAC]
  • Say what you will about Anthony Weiner for his hypocrisy, at least he's occasionally criticized overcriminalization. [NYDN (2008) via Sailer]
  • New Mexico court issues domestic-violence restraining order against celebrity on behalf of delusional woman who claimed he was harassing her through coded messages on his tv show—part of a long track record of judges in that state issuing inappropriate injunctions. [Bader @ CEI]
  • Wouldn't you know it, all that scapegoating of Goldman Sachs was based on a false premise. Will Senator Levin apologize? [Dealbook/NYT via Ribstein]

  • UK anti-racism advocates dismayed by "compensation culture" gone wild. [Telegraph via @walterolson]

Opponents of federal medical liability reform, that is Democratic politicians and trial lawyers, commonly make two arguments against Congressional action along the lines of the current H.R. 5, the Help Efficient, Accessible, Low-cost, Timely Healthcare Act: 1. Liability reform ignores "the real issue", that of medical errors and patient safety, and 2. Federal legislation is an attack against the states, their laws, courts and prerogatives.

The first is an attempt to change the subject, deflecting attention away from the costs of defensive medicine and putting the onus on doctors and insurance companies instead of trial lawyers.

The second serves a political purpose, appealing to federalism-minded House Republicans, especially new members aligned with the Tea Party. There's another advantage, too: The argument has legal and constitutional merit.

Unfortunately, supporters of national medical liability reform rarely engage the federalism issue. Until, that is Wednesday's hearing in a House Energy and Commerce subcommittee, "The Cost of the Medical Liability System Proposals for Reform, including H.R. 5, the Help Efficient, Accessible, Low-cost, Timely Healthcare (HEALTH) Act of 2011." In testimony on behalf of the Health Coalition on Liability and Access, Dr. Troy M. Tippett argued that activist state courts had overturned reasonable tort reforms enacted by legislatures, and health care fell under the Commerce Cause. From Dr. Tippett's prepared statement:

Enacting a federal statue, we believe, is the most effective avenue available to rein in judicial activism, address the medical liability crisis and ensure patient access to health care. H.R. 5 would level the playing field for doctors, hospitals, patients and attorneys, provide needed consistency to the system and eliminate the patchwork of protections in favor of a federal framework based on fairness and common sense.

There is plenty of legal justification for moving in this direction -- some that goes as far back as James Madison and his persuasive arguments in support of the Commerce Clause. This important provision gives Congress the ability to regulate interstate commerce (a definition which the health care industry clearly meets) when done in the public interest. In a 2003 report, the Congressional Research Service (CRS) confirmed this view, concluding that Congress has the authority to enact tort reform legislation generally, under its power to regulate interstate commerce.4 This legal logic has already been applied to an earlier medical dilemma when Congress passed the National Vaccine Injury Compensation Program, a federal program that preempts state court tort awards to protect vaccine manufacturers from bankruptcy in the face of extreme state tort jury awards. A precedent has been set, and we believe now is the time for Congress to act by passing federal medical liability legislation that protects doctors, patients and the states.

But vaccines are sold into interstate commerce and already regulated by the FDA. How is a doctor botching a procedure similar?

Around the web, February 13 - PointOfLaw Forum

  • Tort reform in Wisconsin? Package passed to undo bad Wisconsin Supreme Court decisions, establish Daubert standards, cap punitive damages. [Sachse; Shopfloor; ALEC; NFIB]
  • "Uncommon Law: Ruminations on Public Nuisance" [Faulk @ BEPress]
  • Does David Frum want to criminalize agency costs? [Bainbridge]
  • How bad is the California Supreme Court's Kwikset decision? [Jackson; CJAC; Overlawyered]
  • Some plaintiffs' lawyers pretend that their real Toyota sudden acceleration lawsuit is over the lack of a brake override (which wouldn't prevent driver error); others continue to promote their junk science theory. [NLJ]
  • "Does America have a lawyer problem, or a law problem?" [Reynolds @ Washington Examiner]

  • "Arbitration records lift curtain on Milberg's legal woes" [NLJ]
  • Paging the Truth on the Market bloggers! When it comes to the North Carolina State Bar regulating attorneys overcharging clients, they're slow or unwilling to act, but they're quick on the draw when it comes to innovations that might lead to increased competition and lower fees: "Proposed NC Ethics Opinion Says Lawyers Can't Ethically Offer Groupon Deals." [ABAJ]
  • Andrew Grossman testifies to Senate Judiciary Committee that there isn't a free lunch when you let bankruptcy courts coerce mortgage modifications. [Senate Judiciary Committee]

  • Arbitrator awards $7.5 million to non-tenured teachers fired by Michelle Rhee. Thanks, teachers' union! [Washington Examiner]

Around the web, August 13 - PointOfLaw Forum

  • Nonsensical "predatory pricing" case could bankrupt newspaper, reducing competition in San Francisco. [Welch @ Reason via Overlawyered]

  • As a purchaser of Eclipse mints, I am intrigued by this Eclipse class-action settlement where the attorneys are asking for 33% of a $6M fund that is likely to mostly end up in a cy pres slush fund. [Jackson]
  • A postmortem on Burrow v. Arce, a corrupt aggregate settlement, and whether new ALI rules on aggregate litigation would make any difference. [Brickman @ SSRN via TortsProf]
  • New Federal Initiatives Project Paper on Title IX [Schmauch @ Fed Soc]
  • The Democrats have inadvertently performed a beautiful empirical test proving the proposition that increasing unemployment benefits increases unemployment. [Lott]

Kagan on tort reform - PointOfLaw Forum

We've previously written about Kagan's role in the Clinton administration opposing product liability reform, an act that helped bankrupt two of the Big Three auto companies a decade later. Now we learn from the New York Times that Kagan all but single-handedly persuaded Clinton to veto the Private Securities Litigation Reform Act, which suggests that she'll care more about the effect on trial lawyers than on regular Americans when it comes to pleading standards cases. Furthermore, Kagan's clerkship memos to Justice Marshall suggest she was on the wrong side of DeShaney, putting her to the left of Stevens (well, the 1989 version of Stevens, anyway) on this issue. By the end of his tenure, Stevens was reflexively voting in favor of expanding the role of courts in society and against anything that might put reasonable limits on liability—he was the sole dissent in Twombly and Tellabs, for example. So while Kagan isn't likely to pull the Supreme Court that much further to the left, there is no reason to think she is a moderate on civil justice issues.

Around the web, June 16 - PointOfLaw Forum

  • Arlington, Virginia, taxpayers have paid a law firm $744,000 to allege that a proposed set of high-occupancy-toll lanes on I-395 is racially discriminatory—and that understates the taxpayer waste, since the defendant is the state of Virginia and the federal government, who are paying their own lawyers. [Sun Gazette (h/t M.B.)]
  • Obama administration "running roughshod" over rule of law with respect to BP. [WSJ]
  • Similar problems accrue from Obama administration actions in Chrysler bankruptcy. [Roe/Skeel @SSRN via Bainbridge via @walterolson]
  • Can courts impose liability on a non-policymaking attorney? Miguel Estrada argues no on behalf of John Yoo before the Ninth Circuit on appeal from a bad district court decision refusing to throw out the Padilla case. [SF Chronicle; Yoo @ WSJ]
  • NY state looking to raise caps on attorneys' fees in medical-malpractice litigation. [NY Post]
  • Louisiana Senate passes bill to permit state AG to hire contingency-fee attorneys. Still needs to get past House and Gov. Jindal. [Legal Newsline]
  • Be careful when going on vacation if you live in Seattle; police there refuse to evict trespassing squatters. [Seattle Times]
  • Trial lawyer asserts that there is nothing on Point of Law addressing how to compensate mesothelioma victims (but see), misrepresents law-and-economics view on status quo, then has the chutzpah to suggest it is tort reformers who suffer from "epistemic closure." [Crede]

Kirk Hartley thinks he knows one reason "why asbestos plaintiff's lawyers presently are spending so much time and energy trying to limit the time allowed for depositions of asbestos plaintiffs."

Federalist calendar: Chicago, NYC - PointOfLaw Forum

Today (Monday Apr. 12) at the Society's University of Chicago chapter, Point of Law contributor Ted Frank will be debating author/attorney Thomas Geoghegan on "Did the Right Make America a Lawsuit Nation? A Templeton Debate on Tort Reform." Details here. Tomorrow (Tuesday) at the Columbia student chapter, Ilya Shapiro of Cato discusses the GM bankruptcy with Harvey Miller of Weil Gotshal. And looking forward to next month, on May 6 the New York City lawyers' chapter will host Francis J. Menton Jr., Michael Gerrard, and Lois Bloom on "Does Climate Science Warrant Greenhouse Gas Regulation?"

Around the web, April 6 - PointOfLaw Forum

  • "Maybe He Should Avoid Britain for a While": some lawyers eye assertions of "universal jurisdiction" to arrest Pope in abuse furor [Ku/Opinio Juris and more; Rick Esenberg on statutes of limitations and more]
  • "Appeal Confirms Rejection of Asbestos Bankruptcy Plan as Collusive and In Bad Faith" [Hartley]
  • State AGs as HIPAA police: Connecticut's Richard Blumenthal goes after a hospital over privacy lapse [HIPAA Blog]
  • "In Utah, Stopping Speculative Suits Based on Global Warming" [ShopFloor and update]
  • More high-dollar verdicts in suits alleging bullying [Fox/Jottings and more]
  • "Such a strange theory [in Illinois] -- that the legislature can't set limits on damages" -- Ted Olson [sub-only WSJ]

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