Chronicling the high cost of our legal system

Overlawyered

December 29th, 2006 at 2:41 am

State Bar Files Charges Against Prosecutor in Duke Rape Case

According to this Associated Press report in the New York Times, the North Carolina state bar has filed ethics charges against Mike Nifong, saying that he has violated several ethics rules — in particular the rule against making misleading and inflammatory statements to the media about those accused of a crime.

The bar committee said that it had opened the investigation just two weeks after the rape charges were first made, though it only filed the ethics charges against Nifong on Thursday. In addition to the public-statement charges, Nifong was also charged with dishonesty for certain statements that he knew were misleading based on reports already in his possession.

No hearing date has been set.


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December 28th, 2006 at 6:06 pm

More on the Exxon Valdez punitive damages story

Following up on my post the other day about the lawyers’ share of the possible $4.5 billion Exxon payout — the WSJ Law Blog discussed this yesterday, and provided some additional and interesting numbers. The lawyers’ share of the award has been set at 22.4% of the final judgment, including interest. That’s smaller than the percentage in many contingent-fee agreements, but results in a lot of dollars here.

According to the WSJ, there are 62 law firms representing plaintiffs. Each firm’s share depends in part on how many clients it represents, and there is a three-percent “bonus” for the most-active firms. So each lawyer’s share of the $1 billion+ is a little hard to calculate, but partners at both Faegre & Benson and Davis Wright Tremaine estimated that their firms would each clear over $100 million. Faegre, for example, has 262 partners, so that would be $381,679 each — just $22,451 for each of the 17 years that the case has been pending, but on the other hand there were almost certainly long stretches where little if any work was being done.

Oops — almost forgot the actual plaintiffs. There are 32,677 of them, who will be splitting the other three or four billion (depends on the final interest award). Assuming it’s $3.5 billion, and assuming everybody has an equal share (which isn’t true), each plaintiff would recover $107,108, or $6,300 for each of the 17 years he or she has been waiting. Is it fair that each lawyer on the case will end up with three or four times the cash that an injured party is getting? Let the comments begin.


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December 27th, 2006 at 12:02 pm

Plaintiffs’ counsel in Exxon Valdez case will try to survive on share of lowered verdict

The WSJ’s Law Blog reported recently on the joy being experienced by lawyers in the firms representing plaintiffs in the Exxon Valdez case, their spirits dampened only mildly by the Ninth Circuit’s recent reduction in the punitive award from $4.5 billion to $2.5 billion. Those firms include traditional plaintiffs’ firms such as Milberg Weiss, but also firms normally seen representing defendants, such as Davis Wright Tremaine and Faegre & Benson.

How do Faegre & Benson lawyers feel about the prospect of sharing in perhaps one-third of $2.5 billion? “It’s great,” said partner Brian O’Neill to the WSJ. Any grief due to the $2 billion reduction is probably tempered by the amazing $2 billion in post-judgment interest that will be tacked onto the final bill. (Actually, maybe that’s not amazing in itself, since the case has been pending since 1989. Still, the interest “is not chicken s___,” as O’Neill put it.) O’Neill said of the titanic fee that is coming their way, “This is one of the few chances a bill-by-the-hour guy and a bill-by-the-hour firm has to get ahead.” I for one have been worried for some time about how the partners in these little “bill-by-the-hour firms” were managing to get by, so it’s good to know that for once they may have been able to afford that second can of beans for the family at Christmas dinner.

Damages in the case were estimated at about $500 million. The Ninth Circuit basically held that the evidence did not warrant a punitive award that went to the limit of what is permitted under State Farm v. Campbell, a 9:1 or “single-digit” ratio, and reduced the ratio to 5:1.


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December 26th, 2006 at 4:10 pm

California’s Prop 65: Protecting Us From the Evils of Cooked Chicken

Many of you may be aware of California’s “Proposition 65,” passed in 1986 and intended to help consumers by requiring warnings of any known exposure to a variety of chemicals, many of them carcinogens, that the state identifies on its Prop 65 list. In practice, many would argue, the law has done more to help plaintiffs’ attorneys than consumers, by creating an enormous list of allegedly dangerous substances and permitting a lawsuit whenever warnings of those substances are not posted — whether or not there is any realistic risk of harm under the particular circumstances.

Here’s a good example. Those listed chemicals include “heterocyclic amines” (HCAs) which are formed by cooking meat, the highest concentration occurring in cooked chicken. And so a group called the Physicians’ Committee for Responsible Medicine recently sued several restaurant chains, including McDonald’s, Burger King, and Outback Steakhouse, charging them with failure to warn customers that they cook meat. That is, failure to warn customers about the activity that is the precise reason that those customers are going there in the first place.

According to the National Cancer Institute, while HCAs may have some association with increased risks of cancer, there is currently “no good measure of how much HCAs would have to be eaten to increase cancer risk” — more research is needed. In fact, the NCI cited to one study that specifically covered fast-food restaurants and concluded that those companies’ products had low levels of HCAs. According to that study, home cooking was a greater danger. But that’s the beauty of laws like Prop 65 — evidence tends to be optional.

American Council on Science and Health
Prop 65 News Online

Previous coverage of the animal-rights group “Physicians’ Committee for Responsible Medicine” on Overlawyered: Sep. 6 and links therein.


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December 26th, 2006 at 12:05 pm

Post-Christmas Guestblogging

Hi — I’m one of your two post-Christmas guestbloggers. I’m a defense attorney in the San Francisco office of Shook, Hardy & Bacon, LLP, and I also write a blog called “Lowering the Bar,” which is a legal-humor site, for which, I hasten to add, SHB is not responsible. I have some experience with the unnecessary-lawsuit kind of story in particular, and I think I’ll be starting today with a recent California lawsuit against grilled chicken. Should have that posted in the next hour or so. Anyway, I look forward to blogging here for the next week. Thanks to Walter and Ted for the opportunity.