Results matching “lead paint”

Breaking: jury rejects Milwaukee lead paint suit - PointOfLaw Forum

Like the news just out of Ohio, this latest truly makes June 2007 a month of utter courtroom calamity for those campaigning to nail the industry on "public nuisance" theories.

So far it's been the month Motley Rice would like to forget: on Wednesday the Ohio high court let stand a decision barring plaintiffs from suing former lead-paint manufacturers unless they can in fact identify who made the paint used in given structures. As with the Missouri Supreme Court's ruling last week, the ruling took ambitious "market-share" liability theories off the table (defendants' press release)(via Genova).

Separately, jury deliberations continue following three weeks of testimony in the city of Milwaukee's lead paint case.

By a 4-2 margin, the court has rejected the effort of Newark and other municipalities to invoke the law of public nuisance against manufacturers that long ago sold the paint (Star-Ledger; Genova). It's been a very bad week for the plaintiff's firms that dreamed up these suits, since only days ago the Missouri Supreme Court ruled similarly on product-identification grounds. More: the defense weighs in.

Mo. high court rejects St. Louis lead-paint suit - PointOfLaw Forum

The settled requirement for product identification in a liability suit is enough to sink the city's nuisance action, rules the state's highest court by a 4-3 margin. Defendants say that lead-paint-as-nuisance suits have now been rejected in both the states that have reached a final adjudication on the issue, the other being Illinois. Coverage: St. Louis Post-Dispatch, AP, Legal NewsLine, Jane Genova quoting attorney Richard Faulk (and scroll for other posts).

New featured column: a piece of the (public) action? - PointOfLaw Forum

Our newest featured column is my recent Wall Street Journal op-ed hailing Judge Jack Komar's decision in a California courtroom ruling that private lawyers representing counties in a lead-paint-nuisance suit could not properly pocket a share of the proceeds.

Tort Travesty - PointOfLaw Columns


This piece originally appeared in the Wall Street Journal, 5-18-07

The terse four-page judicial order handed down in a California courtroom last month hasn't made much of a ripple among commentators. But if it stands as precedent following the near-inevitable appeal—and if states and municipalities also follow President Bush, who signed an executive order on Wednesday barring the federal government from entering into contingency fee agreements with trial lawyers—the ruling by Superior Court Judge Jack Komar might slow down the destructive litigation trend of ambitious private lawyers' enlistment of government as a client.

Some background: In the case of County of Santa Clara v. Atlantic Richfield, a number of California counties and cities filed suit asking that lead paint manufactured and sold decades ago be (retroactively and creatively) declared a "nuisance" so that the paint's original makers could be ordered to pay for its removal. As usual in such suits, the localities had hired private lawyers on a promise to share in the winnings if a recovery was made.

Long regarded as ethically suspect if not unthinkable, the public-client contingency fee can be traced back to a case in the 1980s when the state of Massachusetts decided to hire private lawyers to pursue claims over asbestos removal. The innovation quickly spread to other states and issues, most notably the late-1990s tobacco-Medicaid crusade which resulted in multibillion-dollar payouts to both the states and their lawyers.

Trial lawyers love these deals. Even aside from the chance to rack up stupendous fees, they confer a mantle of legitimacy and state endorsement on lawsuit crusades whose merits might otherwise appear chancy. Public officials find it easy to say yes because the deals are sold as no-win, no-fee. They're not on the hook for any downside, so wouldn't it practically be negligent to let a chance to sue pass by?

Now, only two decades later, trial lawyers representing public clients on contingency fee are suing businesses for billions over matters as diverse as prescription drug pricing, natural gas royalties and the calculation of back tax bills. The South Carolina law firm now known as Motley Rice moved into the state of Rhode Island and quickly made itself the No. 1 political donor there, just as it was winning a contract from then-Attorney General Sheldon Whitehouse (now a U.S. senator) to file the first action on behalf of a state against former lead paint makers.

Mayors of over 30 cities signed up for a gun-control-through-legal-coercion campaign of suits against firearms makers so abusive and unpopular in other parts of the country that Congress stepped in to pass a law against it. Authorities in New Jersey, California and elsewhere have hired percentage-fee lawyers to pursue groundwater contamination claims; in the resulting litigation, other environmental aims have tended to be subordinated to the overriding goal of maximizing deep-pocket dollar payout.

But the ethical doubts about the practice haven't gone away, which brings us to Judge Komar and his April 4 ruling in the lead-paint case. The defendants were able to cite a 1985 precedent in which the California Supreme Court ruled contingent fee representation improper as "antithetical to the standard of neutrality that an attorney representing the government must meet when prosecuting a public nuisance abatement action." Agreeing that the case was on point, Judge Komar granted a motion to disqualify the private lawyers.

The principle here isn't hard to grasp. Lawyers who act on behalf of government as distinct from private clients come under special ethical obligations of impartiality. If a lawyer claiming to speak in the name of the people charges you with misconduct, his judgment on whether to drop the charges should not be clouded by the prospect that one-third of any penalties extracted from you would drop into his own private pocket.

Such at least is the logic almost universally accepted when it comes to criminal prosecution. Many court opinions confirm that public prosecutors must not be given a financial stake in the success of the actions they press. In a 1987 trademark-infringement case, for example, the U.S. Supreme Court held it a violation of due process for the government to delegate control of a criminal contempt action to a nongovernment party with a financial stake in the outcome.

What about when the fines or penalties are civil in nature? That question came up in a 1985 case from the city of Corona, Calif. The city had enacted a civil nuisance statute aimed at closing adult bookstores, and then to enforce it hired James Clancy, the attorney who'd drafted the statute, with a bonus to be paid if he succeeded in closing the stores. But the high court in Sacramento disqualified Mr. Clancy, saying that such a proceeding "demands the representative of the government to be absolutely neutral" and that "any financial arrangement"—such as a contingent fee—"that would tempt the government attorney to tip the scale cannot be tolerated."

The California counties and cities that had filed the lead-paint suit—including some of the nation's most populous, with some of the richest tax bases—absurdly tried to plead poverty, suggesting it would prove a hardship for them to hire lawyers on hourly fees. Judge Komar rejected this argument. In reality state and municipal plaintiffs often have more extensive resources than the businesses they sue, as when cities like Boston and Atlanta sue family-owned gunmakers. It's also a practical irrelevance, since smaller governments can and do band together in groups to facilitate litigation that is of common benefit.

The fact is that most such suits are dreamed up by the private law firms and sold to the local officials, not vice versa. Competitive bidding is the exception rather than the rule in retaining the law firms, which routinely recycle handsome donations to the campaigns of the mayors, attorneys general and other officials who hire them. Pay-for-play is so routine that it hardly raises even a shrug anymore. When government legal officers refuse the overtures and instead employ their own staff attorneys to handle such suits, they can face bitter resentment and political pressure for not playing the game in the expected way.

On its face the Santa Clara ruling (like the Clancy case before it) applies only to nuisance-abatement cases, and it's uncertain to what extent courts will agree to extend its logic to other sorts of suits filed by states and municipalities. Moreover, a number of courts in other cases have turned down defendants' motions challenging such fee deals. So it's not the beginning of the end for today's trial-lawyer public-entity alliance. It's more likely just the beginning.

Still time to walk away - PointOfLaw Forum

The Canton Repository, in Ohio, editorially notes that there's still time for the city of Canton to back off from its ill-considered lead paint suit, as did the city of Akron before it.

Milwaukee lead-paint suit goes to trial - PointOfLaw Forum

Trial began Tuesday in a state courtroom; the Milwaukee Journal-Sentinel's coverage is here, and Jane Genova is again blogging the day-by-day developments, as she did in the previous Rhode Island trial. This time around the defense is apparently going to lay greater stress than previously on the government's own role in promoting the material. Quoting the Journal-Sentinel:

After lead paint was banned in Baltimore in 1951, the first ban of its kind in the country, [defense lawyer Donald Scott] said, NL and the Lead Industry Association initiated a labeling standard.

"But the City of Milwaukee continued to specify lead paint for its architects and projects for the next 20 years," Scott said.

As we have had occasion to note elsewhere, a surprising number of products later sued over as defective and injurious do turn out to have been promoted for use by the government itself.

County of Santa Clara v. Atlantic Richfield, cont'd - PointOfLaw Forum

I had an op-ed in yesterday's Wall Street Journal ("Tort Travesty") hailing Superior Court Judge Jack Komar's ruling disqualifying private contingency-fee counsel from representing California government entities in lead-paint litigation, and hoping that other courts embrace the decision's logic recognizing the ethical flaws in such representation. The piece had already been in the hopper at the Journal, but was made more timely by this week's announcement that President Bush had signed an executive order barring the federal government from entering contingent-fee arrangements to compensate lawyers or witnesses. Lattman and Kopel @ Volokh have some discussion of that executive order. Separately, Amanda Bronstad at the NLJ covers efforts in seven states (OH, NJ, CA, MS, WS, KS, NV) to adopt greater transparency in the hiring of outside counsel (or reduce the use of such counsel generally) to cut down on the impression of cronyism and pay-for-play.

P.S. And here's yet more from Beck and Herrmann.

St. Louis wants to pursue lead paint action - PointOfLaw Forum

The Chamber-of-Commerce-backed LegalNewsLine has the details on the city's interest in employing a "public nuisance" theory of liability. And Wisconsin lawyers are filing more lead lawsuits against manufacturers following the Wisconsin Supreme Court's opening of the floodgates two years ago. For developments in Rhode Island, where Judge Michael Silverstein has refused a defense motion to delay the ordering of abatement, and Ohio, check Jane Genova's ongoing coverage.

Calif. judge: gov't lawyers shouldn't be on contingency - PointOfLaw Forum

Earlier this month there arrived some of the best legal news of the year so far:

...a Santa Clara County judge has told several cities and counties they can't contract with private lawyers on a contingency basis in their nuisance suit against lead paint manufacturers.

The ruling by Judge Jack Komar says lawyers for the government are supposed to be neutral, a stance that's not possible when a contingency fee is riding on the outcome of their efforts.

In his written order issued Wednesday, Komar rejected an assertion by Santa Clara County Counsel Ann Ravel and other government lawyers that they retain decision-making authority, even though they've brought in Burlingame's Cotchett, Pitre & McCarthy and other firms for assistance since the lead paint litigation was filed some seven years ago.

Ravel said she will probably appeal Komar's decision, partly out of concern that it could derail other public interest litigation.

As I pointed out way back in The Litigation Explosion (1991) precedents in both the federal and California court systems provide compelling support for the idea that lawyers cannot bring the requisite scrupulousness and neutrality to representing the government if they stand to collect a share of the booty -- which is why we would never think of permitting criminal prosecutors to be paid per scalp. Beck and Herrmann have a typically good post in reaction; the ruling if upheld obviously throws into much doubt the legitimacy of the whole "affirmative litigation" sector and the cozy alliances of public and private lawyers it calls forth, as Hans Bader notes. Another example: many Medicaid "cost recovery" suits by states against drugmakers.

Ohio files lead-nuisance suit - PointOfLaw Forum

For years Rhode Island was alone among the fifty states in its willingness to join the Motley Rice-led campaign against former makers of lead paints and pigments, but now Ohio attorney general Marc Dann has enlisted his office as a state plaintiff as well. (Cleveland Plain Dealer via Adler @ Volokh, Genova, Right Angle Blog). For earlier aspects of the Ohio lead paint story, including the state legislature's clear expression of disapproval of such actions, follow this link; for background on the Rhode Island suit, this one.

P.S. A related observation, from one of Jane Genova's informants: "By where Sherwin-Williams' stock is, Wall Street is betting that no money will be won by any state or city or lost by any former lead paint company."

Wisconsin Supreme Court race - PointOfLaw Forum

As we've chronicled in this space -- and as Rick Esenberg of Marquette recently documented in a Federalist Society paper (PDF) -- the Wisconsin Supreme Court has lately been under the sway of a majority that seems keen on knocking down impediments to litigation, even if that means stretching the law. Among the victims of its law-stretchings have been doctors, lead paint defendants and product manufacturers generally. Today Wisconsin voters will determine whether the court lurches even further in a pro-litigation direction, as seems likely if liberal Madison attorney Linda Clifford fills the vacancy left by the court's most conservative justice. Clifford's rival, conservative Annette Ziegler, had been the front-runner but has been hurt by charges that she did not follow recusal rules when hearing cases with a connection to her husband's business affairs, though there's no sign that either Ziegler or her husband profited financially from her rulings.

Wisconsin was once known for a relatively polite brand of politics, but the race has been an extremely nasty one, with both sides (prominently including trial lawyers in Clifford's case) pouring in money. John McAdams has some coverage. A "progressive" group called One Wisconsin Now is attacking Ziegler for having done asbestos defense when she was in private practice. The Milwaukee Journal Sentinel has endorsed Clifford, delivering itself of the fine-sounding sentiment that "the law must evolve to meet changing needs". Update: Ziegler wins by decisive margin.

Rhode Island lead levels declining - PointOfLaw Forum

"Elevated blood levels have been steadily declining in the core cities and in Rhode Island over the past decade" reports the state, which is good news, though news completely contrary to the claims made when litigating against lead paint companies.

Relatedly, Richard Faulk and John Grey have written for WLF on the abuse of nuisance law that occurred in Rhode Island.

Oxycontin and nuisance - PointOfLaw Forum

West Virginia's settlement two years ago with Purdue Pharma, maker of the drug Oxycontin, was alarming on numerous grounds; Prof. Childs, pointing to this student note (PDF) by Joseph B. Prater of Northwestern on the affair, observes that the case was "another step in efforts to make products liability cases into public nuisance cases". Guns and lead paint having already been assailed under nuisance theories, he wonders whether other pharmaceuticals will follow.

RI lead paint ruling: more reactions - PointOfLaw Forum

Jane Genova continues to solicit and publish (anonymous) reactions and opinions from professionals who've followed the long-running Rhode Island suit (recent coverage here and here). A few excerpts:

"Long-term lead-paint watcher" with law degree:

From what I have observed the likely course of events is that the private law firm of Motley Rice explored where to file a lawsuit against the former lead paint industry. Not all states or cities are equally suited for this kind of litigation. The legal scout probably, as with the tobacco litigation, sought out a venue where those in the leadership might have weighty political ambitions. A plus would be if those ambitions required campaign contributions in order to be realized.

...Another challenge was to get around the reality that although there were laws on the books requiring property owners to maintain lead-safe dwellings those laws were not being enforced. As those who followed the RI lead paint trial might recall, Brown University identified about 1200 properties and landlords where 95 percent of the lead-paint hazards existed in Providence, for example.

The jury during the trial did not have, I contend, a true understanding that this was a landlord problem and the solution was already in-place, but neglected, for dealing with it. Enforcement could have been zealously done.

"Brand name Beltway attorney":

In RI, the state could not sue paint manufacturers, per se. That's because there is in the state an eight year Statute of Repose on the sale of products which "improve real property," including paint. Thus, the "they" putting together the complaint had to sue a small group of large companies which purportedly produced and sold "lead products for paint." As you will recall, the trial is officially about lead pigments, not lead paint per se. The problem for the judge was that there was absolutely no proof that any of these companies did so in the state of RI. That was hammered home again and again by the defense teams during RI lead paint trial II. No evidence, or as NL Industries lead attorney Don Scott put it: NADA.

"Legal expert" characterizing the Rhode Island Supreme Court, where the action is likely headed next:

...not a court which would be considered an "activist" one. ...[but] the Court is likely to give deference to the RI legal community at large and considers standing and respect within that community to be very important. most of us lead paint watchers know, RI is an old boys network in many ways.

Another attorney, non-practicing:

In order to actually receive any money for abatement, the state will have to conduct more specific discovery on the actual number of lead-unsafe properties and the degree to which they present a health hazard. That will be something which the state fought earlier against because the defendants wanted to have that evidence for trial.

All of a sudden, the state will need to argue in favor of that sort of discovery, or try some sort of magic act to get a Special Master to present an abatement plan which includes dollar figures without specifying the extent of the hazard.

Another of Genova's sources, a Washington D.C. attorney, says it's vital to recall that the Rhode Island Supreme Court "is holding in abeyance [i.e., has not yet ruled on] the constitutional challenge of the contingency fee arrangement between the state attorney general and private law firm Motley Rice." And a financial source following the industry is actually "pleased" with the ruling, which allegedly helped "smoke out" issues for appeal.

R.I. lead paint ruling, cont'd - PointOfLaw Forum

Hans Bader of the Competitive Enterprise Institute criticizes Judge Silverstein's ruling (see yesterday's post) and makes this point about one of the theories of liability in the case:

Moreover, the lead-paint lawsuit was based in part on speech by the lead paint trade association, the Lead Industries Association (LIA), which mounted a public campaign against a total ban on lead paint. That raises serious First Amendment problems.

The Noerr-Pennington immunity, a First Amendment doctrine recognized by both the U.S. Supreme Court and the California Supreme Court, immunizes companies and people from liability under the First Amendment for lobbying campaigns that would otherwise trigger liability. See BE&K Construction v. NLRB, 536 U.S. 516 (2002) (company immune from suit under federal law); White v. Lee, 227 F.3d 1214 (9th Cir. 2000) (citizens immune from liability under Fair Housing Act).

The Rhode Island judge tried to get around this by claiming that the jury did not punish paint companies for the LIA trade association�s speech itself, but rather only considered the trade association�s speech to show that individual paint companies �had knowledge of the LIA�s lobbying activities� and to shed light on the �purpose and character� of their actions.

That is a specious distinction. Similar reasoning was rejected by then-judge (now Supreme Court Justice) Samuel Alito in his decision in Pfizer v. Giles, 46 F.3d 1284 (3d Cir. 1995). In that decision, a federal appeals court overturned a trial judge�s refusal to dismiss a lawsuit against Pfizer, which manufactured asbestos, because the trial judge had relied on Pfizer�s membership in an asbestos trade association that engaged in lobbying, some of which was allegedly deceptive. That violated the First Amendment, which protects membership in a trade association that engages in protected speech, even if it also engages in some unprotected speech. (By contrast, there is no proof that the paint industry trade association engaged in any unprotected speech).

And Legal NewsLine has this article quoting Prof. Childs.

R.I. judge says paint makers must pay for cleanup - PointOfLaw Forum

Big, though expected, ruling yesterday in the long-running Motley Rice extravaganza: "A judge on Monday ordered three former lead paint manufacturers to clean up contamination in Rhode Island and said he would appoint a special master to advise him on exactly what the companies should be required to do. Lawyers and financial analysts have said the cleanup could cost more than $1 billion." (Associated Press; Providence Business News; ruling (197 pages!) in PDF format; statement on behalf of some defendants; Providence Journal blog). Judge Michael Silverstein denied the companies' request for a new trial; appeal is considered likely. At Law and More, Jane Genova quotes a Wall Street source who says the paint makers' stocks were not hammered too badly because the ruling had been widely anticipated, and because Judge Silverstein refrained from naming a high dollar figure. More coverage at Genova's site here and here. A blog called Rhode Island's Future crows about the ruling, its author Matt Jerzyk freely admitting that he is not the most detached imaginable observer ("Disclosure: I am a law clerk at Motley Rice.") And Byron Steir has a post here. For previous coverage at this site, see, e.g., here, here, here, here, here, here, here, here, here, here and here, and Jim Copland's column here. Previous coverage at Overlawyered can be found here, here and here.

P.S. David Nieporent, guest-posting at Overlawyered, analyzes the ruling as a case study in "litigation as Robin Hood-style wealth redistribution".

"Dangerous When in Power" - PointOfLaw Forum

A March 2007 Reason article is a must-read for its historical description of how so many mass torts arise from the plaintiffs' bar blaming deep-pocketed private industry for health catastrophes caused by government policy:

The wider conventional view [treats] hazardous products as a sort of standing reproach to capitalism: Businesses foist such products on us in search of profit, the narrative goes, while government protects us from them. And there is much in the asbestos debacle that does reflect discredit on private companies' actions.

Yet the government, our alleged protector, has done much at all levels to promote products later assailed as needlessly unsafe, from tobacco to lead paint, from cheap handguns to Agent Orange. Often the state is at least as aware of the risks as the businesses that distribute the product, and in at least as good a position to control or prevent them. But-shaped and propelled by the incentives provided by our litigation system-our process of organized blame hardly ever puts the government in the dock.

And, hey: it's written by Walter Olson, so you know it's going to be good. Read the whole thing. (Cross-posted at Overlawyered.)

(P.S. by W.O.: Thanks, Ted -- the piece is being linked and discussed at quite a few places around the blogosphere, including Glenn Reynolds, Reason "Hit and Run", The Economist's Free Exchange, Bill Childs, Byron Steir at Mass Tort Litigation Blog, David Hardy's Arms and the Law, and Prof. Bainbridge).

Plus: And yet more, from business historian (and friend) John Steele Gordon at the American Heritage blog.

Ohio veto brouhaha - PointOfLaw Forum

Incoming Democratic Gov. Strickland has (attempted to) veto a liability and lead-paint reform bill passed by the state's GOP legislature and left unsigned by predecessor Gov. Taft. Whether or not Strickland's veto was timely and thus effectual may depend on the question of whether Sunday qualifies as a "day", which is likely headed for court. More reaction via Jane Genova, here and here.

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