MDL Judge Eldon Fallon orders plaintiffs’ attorneys’ fees in the $4.85 billion settlement to be capped at 32%. Hooray, right? Certainly, the trial bar is capable of arguing for itself that the ruling is wrong and it is entitled to a couple of hundred million more, but I might just have to take their side here.
Add the August 28 LA Times to the list of newspapers looking askance at Joe Biden and his family’s cozy relationship to judicial-hellhole asbestos attorneys, in this case Madison County’s SimmonsCooper. (Chuck Neubauer and Tom Hamburger, “Business dealings of Biden family could be problematic for him”, Aug. 28). Unfortunately, the article somehow manages to miss the rationale for creating the trust fund, which was the degree to which so much asbestos litigation in the country is abusive.
Update: also, Am Law Daily.
A USA Today story delves deeply into how Biden’s done the bidding of the litigation lobby special interest group, particularly with respect to the bipartisan asbestos litigation reform bill.
As good an argument for the Class Action Fairness Act as any: Trial lawyers sued Compaq in Texas over an allegedly defective disk controller, though none of the plaintiffs had ever suffered a malfunction or a loss of data, alleging a violation of Texas consumer fraud law on behalf of a nationwide class. No dice: the Texas Supreme Court threw out the case, noting that Texas law did not permit the sort of nationwide class action contemplated by the plaintiffs. End of story? Nope: the same trial lawyers filed the same complaint again, this time in Oklahoma state court, and asked the Oklahoma state court to apply Texas law to a nationwide class. “Sure thing!” the court rubber-stamped–applying an ersatz version of Texas law rejected by Texas courts. The forum-shopping was able to extract $40 million in attorneys’ fees from a questionable coupon settlement, as an Overlawyered post noted August 6. The Summer 2008 issue of State Court Docket Watch includes my essay discussing why this is a constitutionally problematic set of decisions by Oklahoma courts–written before, though published after, the Anthony Caso analysis for WLF.
If you ignore that fact that I’m included, it’s an impressive list, as is the Lawyers for McCain Steering Committee. If you’re a law professor interested in joining the list, do drop me a line.
I should further disclose that I am doing some pretty exciting (if unpaid) consulting for the campaign; as it will require some travel, blogging will be light from me for the next few days.
At American.com, Sara Wexler casts a critical eye at the redlining of new fast-food restaurants out of certain Los Angeles neighborhoods. I hadn’t previously noticed that LA was justifying the ban in part on the claim that South LA’s obese residents are “plac[ing] enormous costs on the California state Medicare system”–as a good an example of the future dangers to freedom of government-run health-care as any.
Gary Charbonneau had a gambling history, including substantial wins, which devolved into compulsive gambling in 2002. He blames this on his Parkinson’s disease medication, Mirapex, which he started taking in 1997. Mirapex changed its warning label to include reports of a correlation while Charbonneau was taking the drug; Charbonneau’s doctor kept prescribing the drug. Nevertheless, Charbonneau was able to persuade a jury that the failure to warn was what was responsible for his $200,000 gambling losses (much of which came from gambling illegally) and resulting marital troubles. The jury verdict even awarded $8 million in punitive damages, giving a whole new meaning to jackpot justice (though one would expect the trial court to reduce this substantially). The only press coverage of this lawsuit, aside from a handful of blogs (Pharmalot; TortsProf; InjuryBoard), is in an op-ed I wrote for today’s Examiner about the case and about how a Supreme Court case and Congressional legislation could affect it. (Theodore H. Frank, “Jackpot justice gets new meaning,” DC Examiner, Aug. 19).
Via Point of Law, today’s DC Examiner has a big package of stories on trial-lawyer felon William Lerach:
The “Who lost when Lerach won?” piece quotes me.
Lester Brickman has a new must-read paper on an under-reported problem:
Lawyers obtain the “mass” for some mass tort litigations by conducting screenings to sign-up potential litigants en masse. These “litigation screenings” have no intended medical benefit. Screenings are mostly held in motels, shopping center parking lots, local union offices and lawyers’ offices. There, an occupational history is taken by persons with no medical training, a doctor may do a cursory physical exam, and medical technicians administer tests, including X-rays, pulmonary function tests, echocardiograms and blood tests. The sole purpose of screenings is to generate “medical” evidence of the existence of an injury to be attributed to exposure to or ingestion of defendants’ products. Usually a handful of doctors (”litigation doctors”) provide the vast majority of the thousands and tens of thousands of medical reports prepared for that litigation.
By my count, approximately 1,500,000 potential litigants have been screened in the asbestos, silica, fen-phen (diet drugs), silicone breast implant, and welding fume litigations. Litigation doctors found that approximately 1,000,000 of those screened had the requisite condition that could qualify for compensation, such as asbestosis, silicosis, moderate mitral or mild aortic value regurgitation or a neurological disorder. I further estimate that lawyers have spent at least $500 million and as much as $1 billion to conduct these litigation screenings, paying litigation doctors and screening companies well in excess of $250 million, and obtaining contingency fees well in excess of $13 billion.
On the basis of the evidence I review in this article, I conclude that approximately 900,000 of the 1,000,000 claims generated were based on “diagnoses” of the type that U.S. District Court Judge Janis Jack, in the silica MDL, found were “manufactured for money.”
Despite the considerable evidence I review that most of the “medical” evidence produced by litigation screenings is at least specious, I find that there is no effective mechanism in the civil justice system for reliably detecting or deterring this claim generation process. Indeed, I demonstrate how the civil justice system erects significant impediments to even exposing the specious claim generation methods used in litigation screenings. Furthermore, I present evidence that bankruptcy courts adjudicating asbestos related bankruptcies have effectively legitimized the use of these litigation screenings. I also present evidence that the criminal justice system has conferred immunity on the litigation doctors and the lawyers that hire them, granting them a special dispensation to advance specious claims.
Finally, I discuss various strategies that need to be adopted to counter this assault on the integrity of the civil justice system.
(Bumping Aug. 14 6:43 pm post to keep at the top of the page.)
In a post I made yesterday, I noted a transaction between Andrew Young and Timothy Toben that I suggested may raise the possibility of a sweetheart deal on the purchase and sale of a 5000-square-foot Raleigh home. I have since done some additional research that rules out that possibility–it turns out that Young purchased a plot of land in a different county, which explains what had otherwise appeared to be a discrepancy–but raises other interesting issues about Young’s cash flow shortly after the National Enquirer allegations first appeared. I have updated the post, and regret the error in the premise.
University of Iowa professor Arthur H. Miller (who is not the NYU Law professor Arthur Miller) allegedly traded grades and offered to trade grades for second-base action with female students, appropriately resulting in criminal charges and being placed on leave by the university. Paul Caron points us to this Chronicle of Higher Education blog post that says Iowa has ordered all of its professors to undergo sensitivity training to avoid sexual harassment. Because obviously a professor who would demand students let him fondle their breasts for a grade would never have engaged in such a behavior if only he had an additional hour of sensitivity training.
What this is really about is lawsuit prevention. Just as a doctor fearful of being sued will order an inefficient, wasteful, and possibly counterproductive medical test, an employer fearful of being sued will insist upon inefficient, wasteful, and possibly counterproductive sensitivity training.
The old joke is that chutzpah is defined as the case of the orphan who kills his parents and then begs the court for mercy because he’s an orphan.
A pair of Philadelphia parents, however, may redefine the idea for all time. Danieal Kelly, who suffered from crippling cerebral palsy, was 14 when she starved to death in a West Philadelphia rowhouse, covered in bedsores, weighing just 42 pounds. Her mother, “Andrea Kelly was charged with murder on July 31. Daniel Kelly, who authorities say abandoned his daughter despite knowledge of her mother’s neglect, was charged with endangering the welfare of a child.” (Three friends of the mother were charged with perjury for lying to a grand jury; four social workers were also charged with felony endangerment, which will no doubt screw up incentives further for over-reacting child protective services everywhere.)
The parents responded as any parents would, and sued the city, the state, city and state agencies, and four social workers, blaming them for Kelly’s death, and seeking damages for “love, tutelage, companionship, support, comfort and consortium” as well as the “economic value of her life expectancy”–which couldn’t possibly be anything other than the taxpayer-funded disability benefits. Public outrage has caused the lawyers, Brian Mildenberg and Eric Zajac, to substitute other parties as plaintiffs so that there is no direct hint of Daniel and Andrea Kelly profiting, but the underlying appallingness of the suit remains. (Julie Shaw & Catherine Lucey, “Lawsuit by Danieal’s parents called ‘disgusting’”, Phil. Inquirer, Aug. 13; Nancy Phillips and Kia Gregory, “Danieal Kelly’s parents sue the city”, Phil. Inquirer, Aug. 13; John Sullivan and Craig R. McCoy, “Nine indicted in fatal neglect of girl”, Phil. Inquirer, Aug. 1; ongoing Inquirer coverage).
Update: See important update below. The Toben-Young transaction appears to be for a different parcel of land than the $1.2 million house–but the new documents reveal something else that’s interesting. More details below.
Andrew Young, who publicly claims to be the father of Rielle Hunter’s baby (though he hasn’t been heard from since John Edwards’s confession of an affair), was moved to Santa Barbara by the generosity of John Edwards’s campaign chairman, trial lawyer Fred Baron. He was paid $3,500/month to work for the Edwards campaign. Yet the Raleigh News & Observer reports that Andrew Young and his wife sold their Raleigh house to Carolyn Grissom for a jaw-dropping $1.2 million on February 14, 2007, and moved into the Chapel Hill Governors Club country-club gated community, where they rented a few doors down from Hunter. (Rentals there are available for as low as $1700/month, and home prices range from $289,000 to $2.3 million, so nothing necessarily unusual about that.)
(Update: New documents I’ve found show that the Toben-Young transaction appears to be for a different parcel of land than the $1.2 million house. More details below. This paragraph, based on the mistaken reading of the transaction that it was for the Raleigh home, is incorrect. I regret the error, but the correction reveals something else interesting about the Toben transaction; see the discussion below.) What’s more unusual is that North Carolina real-estate records on the web show that Andrew and Cheri Young purchased the 5000-square-foot house for $300,000 on September 28, 2005. (Update: this is incorrect. The house was purchased in 2001.) (The home was built in 1989, so they weren’t buying a vacant lot and building.) So either Andrew Young is a secret real-estate genius on a level not seen since Hillary Clinton’s commodities trading, and was able to flip a house for a 300% and $900,000 return in under eighteen months, or something else is going on.
It’s interesting to note that the Youngs purchased the place from North Carolina real-estate developer Timothy Toben–a long-time North Carolina Democratic fundraiser who donated $6,500 to the Edwards campaign in 2007 (which, if the FEC reports are accurate, exceeds the federal campaign limits substantially). If Toben gave Young an unusually good deal, the 2005 timing suggests that Young got the deal for some reason other than Rielle Hunter, but, if so, what?
Meanwhile, if one looks up the home on Zillow.com, one sees that Zillow is skeptical of the $1.2 million purchase price, and values the house for substantially less (though well over $300,000), because of “anomalies” in the deal, though it does not specify what those anomalies are. (I found no indication that Carolyn Grissom is anything other than an innocent homebuyer; she’s not listed in the FEC database.)
This could all be coincidence in hindsight, and there could be a perfectly innocent explanation for all of this. It could be that the $300,000 figure is wrong, though then that raises the question of how Young was able to afford a 5000-square-foot house on a $42,000/year salary. But reporters with more resources than I might want to look into whether an Edwards staffer was getting a sweetheart deal from an Edwards contributor, why, and whether campaign finance laws were violated.
And welcome Michelle Malkin readers; apologies that so many of you clicked through that you briefly crashed the site. For Overlawyered’s coverage of the Rielle Hunter scandal, see the tag, and don’t miss our years-long coverage of John Edwards and his trial-lawyer record.
(August 14: Welcome Kaus and Instapundit readers. Post was corrected August 14, because it incorrectly said “Chapel Hill” instead of “Raleigh” as the location of the $1.2 million house.)
Baron grants an interview to the Texas Lawyer, and makes some implausible claims:
Tim Sandefur asks this only half-facetiously as he reviews mass torts. Of course, as a must-read comment letter to FASB (via the indispensable Beck/Herrmann) submitted by six pharmaceutical companies notes, “A mass tort occurs when the plaintiffs’ bar decides to invest in it.”
I’m quoted at length in a National Law Journal story about criticisms of cy pres awards, the ostensibly charitable contributions demanded in class-action settlements that actually serve to inflate attorneys’ fee awards without requiring actual payments to actual class members. Plaintiffs’ attorneys are using the device to try to get around the requirements of the Class Action Fairness Act, which made it more difficult for attorneys to inflate the nominal value of settlements through coupons, the pre-CAFA means by which plaintiffs’ attorneys inflated settlements. (I’m actually misquoted in one sentence: I said “putative class” to the reporter, and it was written in the article as “punitive class.” Update: corrected in on-line edition.) (Amanda Bronstad, National Law Journal/law.com, Aug. 11).
Point of Law Volokh