July 2002 archives, part 3


July 30-31 – Tobacco fees: one brave judge. Although most of the press from the New York Times on down continues to ignore this developing story, on July 10 Manhattan Supreme Court Justice Charles E. Ramos “told lawyers for six law firms that were awarded $625 million for their work in the historic 1998 tobacco settlement in no uncertain terms that he will examine whether the fee award is unethical. The April 2001 decision of the arbitration panel that issued the award set off ‘a flashing light that got my attention’ that the $625 million fee might violate the New York Code of Professional Responsibility’s proscription against illegal or excessive fees, Ramos told the throng of lawyers that filled his courtroom,” reports Daniel Wise in the New York Law Journal. Virtually the entire array of lawyers in the case was lined up against Judge Ramos: the trial lawyers themselves of course were furious, the tobacco companies were disputing his jurisdiction over the matter, and New York Attorney General Eliot Spitzer’s office was defending the mega-fees in a brief. Outside the courtroom, meanwhile, establishment legal ethicist Stephen Gillers was scoffing that “There doesn’t seem to be any legal or ethical basis for this inquiry.” There doesn’t? The state’s Disciplinary Rule 2-106 bars lawyers from collecting “an illegal or excessive fee,” and it says nothing about excessive fees being okay so long as the other parties in the case have been dragooned into not objecting. (Daniel Wise, “New York Judge Begins Query Into Tobacco Fees”, New York Law Journal, Jul. 12)(see Jun. 21-23 and Oct. 25-27, 2002; May 11-13, 2001). Correction Jul. 31: our first report mistakenly named the scene of these proceedings as the Superior Court; it is in fact the Supreme Court (which in New York is a trial court and not the highest appellate body).

On July 25 the judge held a further hearing which even fewer press outlets seem to have covered — the only account we’ve seen ran on the Bloomberg wire (“N.Y. Judge Calls Tobacco Pact Legal Bills ‘Offensive”, Bloomberg News Service, Jul. 25, fee-based archive (search on date in litigation category, pulling up additional screens if necessary)). Judge Ramos pointed out that the $625 million fee amounted to $13,000 an hour, a figure he described as “offensive”. Although the trial lawyers who are set to collect those fees include many powerful insiders in New York politics — the sort of men who can make or break the career of an elected judge — the judge seemed admirably uncowed by them. He compared the lawyers’ overcompensation to “the problems now emerging in large corporate America”, which prompted Philip Damashek of Schneider, Kleinick, Weitz, Damashek & Shoot, which was awarded $98.4 million in fees, to demand an apology for “comparing me and my colleagues to these Enron people'”. And Ramos “ordered another attorney at the firm, Harvey Weitz, removed from the courtroom when he loudly told partner Brian Shoot not to let the judge interrupt him. ‘You’re sandbagging us,’ Weitz shouted at Ramos as he was escorted out. The judge threatened to hold him in contempt.” The judge “ordered the attorneys to file a new application supporting their fee request by August 30, or submit papers challenging his jurisdiction in the matter. The attorneys declined to say after the hearing how they planned to respond.” Addendum: Daniel Wise of the New York Law Journal also covered the July 25 hearing and provides further details of an oral argument that was “unparalleled — for its vitriol, much of it aimed at the judge.” (“New York Tobacco Fee Hearing Has Lawyers Smoking”, Jul. 26).

More: in Texas, Attorney General John Cornyn’s ethics investigation is turning up the heat on the Big Five tobacco lawyers who for years now have dodged being put under oath over the terms of their hiring by Cornyn’s predecessor Dan Morales (Brenda Sapino Jeffreys, “Investigation of Texas Tobacco Litigators Still Smokin'”, Texas Lawyer, Jul. 22)(see Jul. 15 and links from there). (DURABLE LINK)

July 30-31 – Lying’s not nice, especially when representing the bar. “Oregon’s highest court has suspended for two years an insurance defense lawyer who lied, while being deposed, to conceal a strategy that allowed his client to control both sides of a claim. … The lawyer, John P. Davenport of Portland, Ore., represented the Professional Liability Fund, an insurer established by the State Bar to provide mandatory malpractice insurance.” The Fund used a shell corporation to buy up unpaid malpractice judgments at a discount from claimants, which it could then dismiss; the strategy is not in itself illegal, but the court found that Davenport had not provided forthcoming answers to a bankruptcy examiner about the shell’s dealings with a bankrupt couple who had sued their lawyer for malpractice. (Annie Hsia, “Two-year Ban for Oregon Lawyer Who Lied”, National Law Journal, Jul. 18). In other sanctions news, a federal judge has ordered French drug company Aventis “to pay $32.6 million in attorney fees for vexatious conduct in patent litigation against Bristol-Myers Squibb Co. Southern District of New York Judge Robert P. Patterson said last week that [the company] ‘defiled the temple of justice’ by obstructing depositions and discovery, instructing a witness not to answer questions at a deposition and advancing baseless claims.” The finding of vexatious conduct is on appeal (Tom Perrotta, “Drug Company Must Pay Fees of $32 Million”, New York Law Journal, Jul. 29). (DURABLE LINK)

July 29 – “Bush Urges Malpractice Damage Limits”. “President Bush urged Congress today to impose substantial nationwide restrictions on medical malpractice cases, arguing that million-dollar verdicts are driving up health care costs and forcing doctors out of business.” Sen. John Edwards (D-T.Law.) promptly charged that under the White House proposal, when a child is blinded or paralyzed for life, “He [Bush] proposes what they get for that is $250,000.” (Mike Allen and Amy Goldstein, Washington Post, Jul. 26). In fact, as Edwards cannot but be aware, damages to cover the costs of care, lost income and other monetizable damages, which commonly would run into the millions in the case of a paralyzed child, would remain fully collectable as before; the mooted limit would apply only to the portion of awards which covered “non-economic” elements such as pain and suffering. (Bush remarks; White House “Policy in Focus“; HHS report on effects of medical liability, PDF format). The Senate Republican Policy Committee has published a paper collecting some of the malpractice-suit-crisis “horror stories” from recent months, with links to accounts in the press (Jul. 25). See also Steve Friess, “Liability costs drive doctors from practice”, Christian Science Monitor, Jul. 17; “Soaring Liability Costs Blamed for Non-Profit Nursing Home Closures”, Dallas Morning News, Jul. 25 (reg); Corpus Christi (Tex.) Caller special section, letters. Sasha Volokh and correspondents discuss the federalism angles (Jul. 27). (DURABLE LINK)

July 29 – Law lectures needn’t be dull. We were familiar with some of the writings of Harvard law prof David Rosenberg, but we had no idea his lecture style was so … colorful, as evidenced by this best-of collection (Harvard Law Record, 1999) (via Eve Tushnet, Jul. 25, who got it from Stuart Buck, Jul. 22 and Jul. 25; and thanks to Dan Lewis for the web-archive link). (DURABLE LINK)

July 29 – New medium, new opportunities. John Steele Gordon, the history-of-business columnist for American Heritage and author of such acclaimed books as A Thread Across the Ocean and The Business of America, devotes his new column to comparing the rise of online publishing with the technological developments, such as the rotary press, that ushered in the era of the metropolitan newspaper in the years before the American Civil War. “When the young can enter a business and experiment with new technology at little risk, revolution is on the way.” Small internet news-gathering and news-assemblage sites can now “have a great impact. … [One of them] has been giving tort lawyers and activist judges fits by assembling in one much-visited site called overlawyered.com the most egregious lawsuits and decisions from around the country and beyond. It makes for reading that is often hilarious, infuriating, and sad at the same time.” (“The Man Who Invented the Newspaper”, Aug./Sept.). (More on weblog impact: John Leo, “Flogged by Bloggers”, U.S. News, Aug. 5). While on the subject of nice publicity, we won’t even try to summarize all the additional exposure this site and its editor have gotten in the past few days from the lawyers-sue-fast-food controversy, but we will note that our editor’s O’Reilly Factor appearance of last Tuesday, on educational lawsuits, is now online at FoxNews.com (“Watch out Teachers!”, Jul. 24). (DURABLE LINK)

July 26-28 – Fat suits, cont’d. George Washington University law prof John Banzhaf, who got himself so much publicity in the tobacco round, says he’s advising the plaintiff who just announced that he’s suing fast-food chains, so we know the suit must be serious (right?) (Geraldine Sealey, “Fat suits filed”, ABC News, Jul. 25; BBC, “Fat Americans sue fast food firms”, Jul. 25, and “Talking Points“). As for our editor, he’s in considerable demand on the subject, having appeared over the past day on (among others) Fox News Network, CBS radio, and the BBC. This just in: debating our editor on Laura Ingraham’s radio show Friday evening, Banzhaf announced that he is working up a possible suit against milk marketers which will charge that the “Milk Moustache” campaign should give rise to liability because it doesn’t warn consumers that skim milk is sometimes better for you than whole milk. Is he serious? He sure sounded like it (discussion on Democratic Underground). (DURABLE LINK)

July 26-28 – Third Circuit: prisoners may be entitled to watch R-rated films. “Inmates in federal prisons who challenged a ban on allowing them to watch movies rated R or NC-17 have won a new shot at making their case now that a federal appeals court has ruled that a Western District of Pennsylvania judge was too quick to rule in favor of the government. In Wolf v. Ashcroft, the 3rd U.S. Circuit Court of Appeals found that U.S. District Judge Sean J. McLaughlin of the Western District of Pennsylvania ‘did not conduct a proper, thorough analysis’ of whether the ban is ‘reasonably related to legitimate penological interests.'” The trial judge’s ruling against the prisoners, furthermore, “improperly relied on ‘common sense'”. (Shannon P. Duffy, “Prisoners’ Suit Over R-Rated Movies Worth Another Look, Says 3rd Circuit”, The Legal Intelligencer, Jul. 25). (DURABLE LINK)

July 26-28 – Skittish at Kinko’s. The clerk at the copy shop raises objections to a request to photocopy a newspaper column: “Do you have permission to duplicate this copyrighted material?” But it’s my column, the customer protests — I wrote it! “Look — my picture is on the top.” “He told me that didn’t matter, that corporate Kinko’s was overburdened with copyright lawsuits, and consequently he wasn’t about to run my copy job. Sheesh.” (“Inane Laws and Egotistical Copy Men”, Cornell Daily Sun, Mar. 4). (DURABLE LINK)

July 26-28 – Update: cost of clipboard-throwing only $8 million. A San Diego judge has reduced the damage award from $30 million to $8 million in a case against the Ralphs supermarket chain over the conduct of a manager who over the course of a decade is alleged to have verbally harassed female employees and thrown such objects as a telephone and clipboard at them. Superior Court judge Michael Anello called the damages “grossly excessive” and the result of the jury’s “passion and prejudice,” and said “the evidence was insufficient to support the conclusion that defendant [corporation] approved of or ratified [the manager's] conduct.” The decision is “a slap in the face of women’s rights,” countered the plaintiffs’ co-counsel (see Apr. 19-21) (Alexei Oreskovic, “Judge Slashes Sex Harassment Damages Against Ralphs Grocery”, The Recorder, Jul. 17). (DURABLE LINK)

July 25 – “Ailing Man Sues Fast-Food Firms”. You knew it was coming: “A New York City lawyer has filed suit against the four big fast-food corporations, saying their fatty foods are responsible for his client’s obesity and related health problems. Samuel Hirsch filed his lawsuit Wednesday at a New York state court in the Bronx, alleging that McDonald’s, Burger King, Wendy’s and KFC Corporation are irresponsible and deceptive in the posting of their nutritional information, that they need to offer healthier options on their menus, and that they create a de facto addiction in their consumers, particularly the poor and children.” Quotes our editor, who takes the dim view of the suit that you would expect (Michael Y. Park, FoxNews.com, Jul. 24). (DURABLE LINK)

July 25 – “Surgeon halts operation over foreign nurses’ poor English”. Britain: “A surgeon at a leading hospital has said he had to stop halfway through an operation because foreign nurses could not follow his instructions. As a result, he said he has been threatened with disciplinary action for racism. David Nunn, a consultant orthopaedic surgeon at Guy’s and St Thomas’s Hospitals, in London, told The Telegraph that he was unable to complete the operation last week without certain instruments. When he asked the nurses, all of whom were foreign, to find them, ‘I was met with a selection of bemused reactions,’ he said. ‘They were produced only when the scrub nurse de-scrubbed and went to find them herself.’ Mr Dunn, 48, said his superiors had accused him of racism and threatened him with being disciplined.” Dunn said the influx of nurses from outside Britain are “without doubt well-trained and dedicated professionals, but if medical staff cannot communicate effectively then patients’ care may be put at risk.” Careful what you say, doc… (Richard Eden, Daily Telegraph, Jul. 22). (DURABLE LINK)

July 25 – “Licensing Deadline Sneaks Up In District”. “Consultants, landlords, music teachers, nannies, massage therapists and other home-based workers in the District face fines of as much as $500 if they do not obtain a new type of city license by Aug. 31, but most are unaware of it. Self-employed individuals and District firms, including nonprofit groups, that collect more than $2,000 in annual revenue will have to obtain a master business license to legally sell their services.” More “than 60,000 businesses and individuals in the District face fines of as much as $500 if they don’t obtain a new type of city license by Aug. 31″ — and have things really reached the point where it’s going to require a license from the government to practice independent journalism from your apartment? (Avram Goldstein, Washington Post, Jul. 21; “How D.C. Creates Chaos” (editorial), Jul. 23; Eugene Volokh, Jul. 23). (DURABLE LINK)

July 24 – Smog fee case: “unreal world of greed”. A California appeals court has thrown out an arbitration panel’s $88.5 million award of attorneys’ fees, amounting to an estimated $8,800/hour, to five law firms which had prosecuted a case against the state of California arguing the unconstitutionality of its former assessment of “smog impact fees” on cars registered from out of state. “The justices called the panel’s $88.5 million fee award ‘an unconstitutional gift of public funds’ that was not authorized by the Legislature. In a scathing concurring opinion, Justice Richard Sims said the award from the arbitration panel was ‘completely in outer space.’ ‘The fact that attorneys even requested a fee award of that magnitude from the taxpayers,’ Sims wrote, ‘is a testament to the unreal world of greed in which some attorneys practice law in this day and age.'” The five law firms included Milberg Weiss Bershad Hynes & Lerach, long a major political donor in California, as well as “New York’s Weiss & Yourman; San Diego’s Sullivan, Hill, Lewin, Rez & Engel; La Jolla, Calif.’s Blumenthal & Markham, and Berkeley, Calif., solo practitioner Richard Pearl.” (see Dec. 5, 2000, Jun. 22, 2001)(Robert Salladay, “Court rips $8,800 an hour in attorneys’ fees”, San Francisco Chronicle, Jul. 23; Mike McKee, “California Appeals Court Rips $88M Fee Award in Smog Case”, The Recorder, Jul. 23). (DURABLE LINK)

July 24 – Update: “Harassment by kids gets ex-teacher 50G” Following up on a story from last month: the city of New York has agreed to pay $50,000 to settle a lawsuit by a former Queens teacher who says his students had harassed him by way of derogatory comments about his immigrant status (from Sri Lanka), accent and ethnicity. “Legal experts said the suit was the first of its kind in which a teacher successfully brought a civil rights action alleging that students had created a ‘hostile work environment.'” The other noteworthy feature of the dispute (see Jun. 26) is the defense the city put forth, namely that it was powerless to discipline the students, who had special education (disabled) status, for insulting the teacher “because students with that classification have already been identified as having behavioral problems, and the verbal misconduct might be considered a manifestation of their disability,” as a city lawyer put it (John Marzulli, “Harassment by kids gets teacher 50K”, New York Daily News, Jul. 22). (DURABLE LINK)

July 23 – Welcome O’Reilly Factor viewers. Our editor was a guest on the top-rated TV talk show this evening, interviewed one-on-one by host Bill O’Reilly on the subject of parents threatening to sue teachers over their kids’ bad grades. We mentioned the recent Arizona case and an earlier Ohio case that we understand has been dismissed by the court; and here’s our theme page on overlawyered schools. (DURABLE LINK)

July 22-23 – Politicos’ “stagey” outrage at balance-sheet sins. “John Walker Lindh got 20 years this week for joining a terrorist network at war with his country. Lucky for him he didn’t try something really bad, like capitalizing an expense item. … President Bush, who spent 56 years on this earth without revealing the slightest passion for corporate reform, now says life will be intolerable if he doesn’t have a bill to sign within a couple of weeks. And he has sent signals that he doesn’t give much of a hoot what is in it.” (Michael Kinsley, “Stock Option Cure-All”, Washington Post, Jul. 19). “Even now, the mob waving pitchforks and torches finds the details of accounting, compensation and corporate governance too tedious to take seriously. But ‘reforms’ that ignore the role of incentives and competition will turn out to be monsters themselves.” (Virginia Postrel, “Business ‘Reforms’ Should Not Ignore Incentives and Competition”, New York Times, Jul. 18 (reg)). (DURABLE LINK)

July 22-23 – Nightmare under the palms. You retire to a Florida condo, and imagine that the hassles of life are over — that is, until you discover that a couple of your neighbors have turned asserting their legal rights into an art form. (Joe Kollin, “Sunrise condo residents get socked with bill because neighbors won’t pay”, South Florida Sun-Sentinel, Jul. 19). (DURABLE LINK)

July 22-23 – Disabled testing: hence, loathèd asterisk. In a settlement with a disabled-rights litigation group, the College Board has agreed to stop flagging the test scores of students who got extra time or other accommodations in taking its college admissions test. The effect will be to allow applicants to conceal from colleges whether they “took the test under normal conditions, or used a computer, worked in a separate quiet room, and had four and a half hours for the three-hour test. … High school guidance counselors said the elimination of flagging could set off a wave of new applications for accommodations, including some from students without real disabilities. … most of those who are accommodated have attention deficit problems or learning disabilities like dyslexia, a reading disorder.” “It’s very clear who’s been getting extended-time: the highest-income communities have the highest rates of accommodations,” said Bruce Poch, the dean of admissions at Pomona College in Claremont, Calif. “I think what’s going to have to happen now is that everyone will, in effect, get more time.” (Tamar Lewin, “Abuse Is Feared as SAT Test Changes Disability Policy”, New York Times, Jul. 15 (reg)). Among commenters: Kimberly Swygert at No. 2 Pencil (Jul. 15 and 17) and Joanne Jacobs (Jul. 15 and Jul. 17). We covered the controversy back in February 1999, May 10, 2000 and Feb. 9-11, 2001. (DURABLE LINK)

July 22-23 – Last-minute friends in Texas politics. “In 1998 [John] Sharp narrowly lost the lieutenant governor’s race to Republican Mr. Perry, who later became governor when George W. Bush became president.” Sharp drew about 15 percent of his financial backing from trial lawyers in that race, which actually probably isn’t all that high a percentage for a Lone Star Democrat. What was interesting was the timing: “A review by The News of finance reports in that matchup indicates that nearly half Mr. Sharp’s trial lawyer support came in the final eight days of the campaign and was not reported until after the race. For example, a few days before the election, Mr. Sharp collected $250,000 from Houston trial lawyer John Eddie Williams and $150,000 apiece from lawyers Walter Umphrey of Beaumont and Harold Nix of Daingerfield. And he got $15,000 from Michael Gallagher of Houston.” Reports of trial lawyer backing can damage a candidate in Texas campaigns, but when the lawyers donate at the last minute the voters may be none the wiser as they troop to the polls (Wayne Slater, “Trial lawyers’ cash at issue”, Dallas Morning News, Jul. 13). (DURABLE LINK)

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July 25 roundup
07.25.08 at 12:23 am

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