Carter Wood has been doing great things lately with the National Association of Manufacturers' Shop Floor blog, which often treats legal reform topics. Since Monday he's also been posting up a storm guestblogging at Point of Law. Topics include: ATLA/AAJ's juvenile pre-nose-thumbing at the U.S. Chamber of Commerce's 2008 Lawsuit Climate Report (which, like similar studies from ATRA and Pacific Research Institute, tries to pick best and worst state legal environments); the employment-litigation-expanding Lilly Ledbetter Fair Pay Act (more); some thoughts on journalistic shield laws; and sundry reports from the Geoffrey Fieger trial, Florida politics, and Texas Supreme Court-watching.
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Which has merely induced Dan Kennedy (Oct. 27) to reproduce the thing as a public service (Jim Rutenberg, "Student Paper Upsets the Edwards Camp", New York Times, Oct. 26). The Streisand Effect strikes again...
I previously posted on Washington's Insurance Fair Conduct Act, known as Referendum 67. If passed by the voters, it would allow first party claimants to recover triple damages and attorney fees for those claims "unreasonably" delayed or denied.
Existing law already allows a wronged insured to bring three separate causes of action against his/her insurer for such claims: breach of contract, bad faith and violations under Washington's Consumer Protection Act (CPA). Such existing remedies often yield bizarre results as we saw in the Woo v. Fireman's Fund case.
The Supreme Court's knuckleheaded 5-4 ruling upheld a judgment to pay Woo $250K he paid to settle an underlying suit, plus $750K in emotional distress and attorney fees. Obviously, there are already plenty of incentives for an insurer to avoid these judgments by acting fairly, and under this legislation Woo could have received three times more as punitive damages in addition to the "emotional distress" damages which have a punitive measure built into them. And in case you are wondering, Fireman's Fund coverage position was perfectly reasonable.
The television ads for the Approve 67 camp are demagogic and misleading, if not outright lies. The worst has to be the ad featuring Tiffany Forslund whose father, firefighter David Potter, died allegedly because an insurer delayed payment for necessary health treatment. Forslund says:
My father would have given his life in the line of duty, turns out the insurance company took it instead.
What tripe. Not only would R-67 not apply to her father's claim (it is intended to benefit auto, home and property policies--not health insurance) it's not true according to the mayor of the city for which Potter worked, who said it would be covered as a workers' compensation claim or through the city's health plan. But the attorneys promoting this legislation could not resist such a sympathetic story of a firefighter allegedly killed by an insurance company, even if it's entirely off-point and probably untrue. Demagoguery at its finest. And, if the claim is true Potter's family already has remedies under existing law for emotional distress, which, for a lost loved one are rightfully substantial and the threat of such judgments deter wrongful insurer conduct. Why shall we now triple those damages?
Attorney fees are typically one-third of the gross recovery. So if the gross recovery is tripled it equals a bigger fee. But let's say the insured prevails but the gross recovery is small? No problem. Just submit your fee request to the court on an hourly basis if it provides a greater recovery for the attorney. And, here's another little tidbit: the attorney fee provision is mandatory but the triple damages are at the court's discretion. Who's looking out for who here, really? And, that the triple/punitive damages are for the deliberately vague "unreasonable" and not for criminal, willful or wanton conduct as you would expect (and would be deserved) to award punitive damages makes for a juicy tidbit indeed.
And, there's no crisis in the first place. Check out this link from the Insurance Commissioner of Washington State showing the number of complaints against individual insurers. In 2006, Private Passenger Auto Insurance Complaints averaged one complaint for every $1.5M in premium and Homeowners Insurance Complaints averaged one complaint for every $2.5M in premium. Hardly a crisis, and nothing worthy of threatening triple damages in every instance.
This legislation will enrich those attorneys bringing these suits, bring a windfall to a small number of insureds at the greater expense of all who pay insurance, directly or indirectly.
This time it's Ed Murnane of the Illinois Civil Justice League presenting a tour of the various candidates' stands on civil justice reform (Oct. 15; ritual disclaimer).
The San Antonio trial lawyer and Democratic donor says he's realized he'd like to spend more time with his family. Surely it couldn't have had anything to do with controversies like the ones covered here or here or here. (Peggy Fikac, "Watts ends bid for Democratic Senate nomination", Houston Chronicle, Oct. 23).
House Democrats have introduced legislation that would hold third-party banks liable for packaging and reselling mortgages that the borrower decides to sue on. Back in April, I wrote in the Wall Street Journal why this earmark for trial lawyers would be disastrous to the economy and make the subprime crisis far worse than it is now.
Liability reform provided an early flashpoint last night, with Giuliani assailing Fred Thompson's Senate voting record and Sen. Thompson offering a federalism defense. (Althouse, Oct. 21)(more; ritual disclaimer). More: the Giuliani site is hitting Thompson hard on the issue.
Ted has already mentioned today's front-pager on Milberg Weiss campaign donations, which is kind enough to quote me. I was particularly glad that reporter Mike McIntire took note of some of Milberg's connections on Capitol Hill, which tend to get less attention than its Presidential campaign donations:
Beyond campaign contributions, Milberg Weiss became deeply ingrained in the financial firmament of the Democratic Party in other ways. Members of the firm gave $500,000 toward construction of a new Democratic National Committee headquarters, and some became partners in a private investment venture with several prominent Democrats. They included former Senator Robert G. Torricelli of New Jersey, who is a fund-raiser for Mrs. Clinton, and Leonard Barrack, a Philadelphia trial lawyer who was once the national fund-raising chairman for the Democratic Party.Along the way, as Milberg Weiss’s brass-knuckles legal strategy made it a target for Republicans advocating limits on class action suits, it usually could count on Democrats in Washington to protect its interests. After federal prosecutors indicted the firm in May 2006, four Democratic congressmen issued a joint statement, posted on Milberg Weiss’s Web site, accusing the Bush administration of persecuting lawyers who take on big businesses.
The statement, signed by Representatives Gary L. Ackerman, Carolyn McCarthy and Charles B. Rangel, all of New York, and Robert Wexler of Florida, contained several passages that appear to be lifted directly from a “class action press kit” distributed by a national trial lawyers group. All but Mr. Wexler have received campaign contributions from Milberg Weiss partners.
(Mike McIntire, "Accused Law Firm Continues Giving To Democrats", New York Times, Oct. 18).
The New York Times finally gets around to exploring the ties between indicted Milberg Weiss, convicted Bill Lerach, and John Edwards and the Clintons (as well as the four Democrat representatives who parroted statements about Milberg's supposed innocence). Walter is quoted. (Mike McIntre, "Accused Law Firm Continues Giving to Democrats", Oct. 18). Regular readers of Overlawyered and Point of Law knew all this months ago. Useful comparison: MSM mentions of Enron ties to the Republican party compared to the much-more culpable Milberg Weiss much-more extensive ties to the Democrats—especially given the political favors done for the parasitical law firm that have allowed it to extract billions of dollars from investors.
Wisconsin blogger Jessica McBride reports that the Wisconsin Supreme Court, by virtue of a 3-3 decision, affirmed a lower court ruling on the ludicrous $17 million Heikkinen verdict (Feb. 21 and Feb. 27, 2005). Point of Law has previously documented the travails of the 4-3 liberal majority that has become one of the most activist state supreme courts in America.
I take a look at the question this morning at Point of Law.
Does the Democratic Party realize the extent to which party leaders are selling out its principles to the trial lawyers? It's gotten to the point that they're running John Arthur Eaves, Jr., for governor in Mississippi. Eaves is pro-school-prayer, anti-abortion, and more sanctimonious in his Christianity and gay-bashing than any Republican regularly criticized by the Kossacks of the Left. But at least he supports (and is a member of) the trial bar! Democrats' other constituencies should take a long hard look at the extent to which their issues are going to take a back seat to the litigation lobby's takeover of the party. (Adam Nossiter, "In Mississippi, Democrat Runs in G.O.P. Lane", New York Times, Oct. 10).
Update: Howard Erichson notes Eaves's slogan ""If it wasn't your fault or an act of God then someone must be held responsible" and Peter Lattman also covers the page-1 Times story.
"Voters want and deserve a candidate who represents real people, not corporate special interests." -- John Edwards spokesman David Bonior, attacking Hillary Clinton in the New York Times
On yesterday's radio program, host Hugh Hewitt asked me about the various GOP contenders' stands on liability reform. I replied that for the most part they were clumped pretty closely together in strongly backing federal-level reform measures, the exception being Sen. Fred Thompson who has voted against several Congressional proposals to limit liability and has been backed fairly strongly by plaintiff's lawyers in his campaigns. I added that Thompson has defended his votes on federalist principle and that his arguments on this point deserve a fair hearing; there are often plausible (and even compelling) federalist reasons to refrain from nationalizing areas of liability where the ultimate cost of state-court errors falls within states' own borders rather than being dumped on residents of other states.
Those interesting in pursuing these questions can find more on Thompson's views here, here, and here; on Giuliani's here and here (and ritual disclaimer); on Romney's here and here; and on Rep. Ron Paul's, here (opposes Congressional involvement in malpractice reform on federalist grounds).
Tennessee state representative Rob Briley chaired the Judiciary Committee in the state House, and also held a seat on a study committee "assigned to recommend changes in the state’s DUI laws." So you might regard it as unseemly of him, after having smashed his vehicle into a pickup truck on the afternoon of Sept. 8, to have led police on a 100-mph chase in Wilson and DeKalb counties. The chase culminated in his being apprehended and charged with offenses that included drunken driving, evading arrest, and vandalism. The vandalism consisted of doing "about $1,000 worth of damage to the patrol car by kicking and punching the back door and window", according to police, who say they found an empty bottle of bourbon and several bottles of prescription meds in Briley's SUV.
What raised some eyebrows around the state is that when officers at the Wilson County Jail had him fill out a form listing a “next of kin” or other person he wanted contacted, Briley, who is going through a divorce, named Mary Littleton, lead lobbyist for the Tennessee Association for Justice, formerly known as the Tennessee Trial Lawyers Association. His explanation later was that Ms. Littleton was a logical person to name since she knew a lot of lawyers and he was going to need a lawyer. Briley has now resigned his Judiciary chairmanship as well as the seat on the DUI commission, and says he's in rehab. Indeed, he claims he was headed for a rehab center on the afternoon in question -- so eager to get there, perhaps, that 100 mph seemed only reasonable. He has now retained Ms. Littleton, who describes herself as a long-term friend, and two other attorneys to represent him. (Eric Schelzig, "Video shows Rep. Briley berating police, sobbing", AP/Ashland City Times, Sept. 12; Kleinheider blog, WKRN, Sept. 13; Sheila Wissner, "Briley listed lobbyist as contact after DUI arrest; has no memory of chase", The Tennessean, Sept. 13; Michael Silence, Sept. 13; Tom Humphrey, "Rep. Briley steps down from chairman position", Knoxville News-Sentinel, Sept. 15; Sheila Wissner and Sheila Burke, "Arrest report says Briley had been committed", Ashland City Times, Sept. 15).
Who is the "formerly hard-partying girl who claims that she found enlightenment" who met John Edwards in a bar and was paid six digits by the campaign to make videos of him that "lingers over the former senator's behind as he tucks a starched white shirt into his pants," and why is the campaign suddenly hiding the webvideos she made of Edwards on questionable legal grounds? Mickey Kaus is curious after reading this Sam Stein post. Separately, Garance Franke-Ruta notes the irony of Edwards stumping the SEIU for votes and donations on the leftist union's "Lobby Day." For other Edwards campaign shenanigans on Overlawyered, see Sep. 19.
Looks as if the legal tactics of one politically ambitious Texas plaintiff's lawyer may have blown up in his face:
Democratic U.S. Senate candidate Mikal Watts of San Antonio once tried to pressure a legal opponent into a $60 million personal injury lawsuit settlement by claiming he would have an advantage on appeal because of his firm's "heavy" campaign financial support to an appellate court's justices, "all of whom are good Democrats."
A "nine-page letter Watts wrote to opposing counsel in 2001 apparently was intended to make an out-of-state corporation think the donations could sway" the 13th Court of Appeals in Corpus Christi. The letter was sent to a defense lawyer representing American Electric Power in an auto-accident case. "Politely put, south Texas venue by itself makes this a very dangerous lawsuit," Watts wrote.
What made the letter unusual was the linking of campaign contributions to sitting justices and the potential of an appeal.The letter then noted that if the case went to appeal, it would go to the 13th Court of Appeals.
"This court is comprised of six justices, all of whom are good Democrats," Watts wrote. "The Chief Justice, Hon. Rogelio Valdez, was recently elected with our firm's heavy support, and is a man who believes in the sanctity of jury verdicts."
The letter goes on to name Justices Errlinda Castillo, Nelda Rodriguez, J. Bonner Dorsey, Federico Hinojosa and Linda Yanez, and says his firm also has financially supported them. Hinojosa, Castillo and Dorsey are no longer on the court.
"Justice Bonner Dorsey, is more conservative than the others, but has been a friend of mine and the sanctity of jury verdicts for many years," Watts wrote.
Watts and his law firm in 1999 donated $5,000 to Valdez and $2,500 to Rodriguez; in 2000, $15,000 to Hinojosa; and in January 2001, $10,000 to Castillo. The firm donated $50,000 to Yanez in 2002.
(R. G. Ratcliffe, "Senate candidate played up contributions to justices", Houston Chronicle, Sept. 5; "Watts' letter shows judicial reform need" (editorial), San Antonio Express-News, Sept. 15; PrairiePundit, Sept. 7 (quoting Houston Chronicle editorial that's now offline)).
Blog reaction among both Texans and Democrats has been overwhelmingly negative. "This is bad," writes the eponymous Kos at Daily Kos. Similarly: Burnt Orange Report, Urban Grounds, Eye on Williamson, Doing My Part for the Left, Capitol Annex. For links to some of our coverage of Watts's colorful courtroom exploits over the years, see Jun. 9. As a matter of fact, Ted covered Watts' eye-opening demand letter in a Point of Law post of Nov. 2, 2005.
Don Surber welcomes Hizzoner's conversion; Sister Toldjah remains to be convinced (disclaimer; and see quote from me here; our page on firearms litigation and regulation). More: By coincidence, the Bloomberg administration is in court at the moment trying to argue that the Protection of Lawful Commerce in Arms Act doesn't actually put the kibosh on the city's gun suits, despite a mountain of evidence that it was intended to do just that (Mark Hamblett, "2nd Circuit Hears Arguments on Letting NYC's Gun Suit Go to Trial, New York Law Journal, Sept. 24).
As Walter noted, Lerach was a bundler for Edwards; his plea agreement included an agreement by the government not prosecute illegal campaign donations. Still, while Edwards is giving back Lerach's personal donation, he's holding on to the rest of the $78,000 that Bill Lerach raised for him, even as Edwards criticizes Hillary Clinton for holding a fund-raiser at Jones Day (whose attorneys have given more money to Obama) and taking money from lobbyists. Edwards hasn't given back the $125,000 Geoffrey Fieger is indicted over raising for him either.
Longtime readers of this site may remember attorney Judy Cates of Swansea, Ill., who filed and later settled a defamation lawsuit against St. Louis Post-Dispatch columnist Bill McClellan over a humorous and disrespectful column McClellan had written regarding a controversial class-action settlement Cates and other lawyers had reached with magazine sweepstakes firm Publishers Clearing House (Nov. 4 and Nov. 30, 1999; Feb. 29, 2000; for other watch-what-you-say-about-lawyers cases from Madison County and thereabouts, see Dec. 23, 2004). More recently, Ms. Cates served as elected president of the Illinois Trial Lawyers Association (Jul. 3, 2006). And now she's thrown her hat into the ring for a seat on the state Fifth District Appellate Court, which sprawls over 37 counties. She'll mount a challenge in the February Democratic primary to Jim Wexstten, who was appointed this year to fill a vacancy on the court and who is regarded as a moderate-to-conservative Democrat. The Post-Dispatch's coverage forgivingly (or perhaps prudently) does not mention her having sued the paper's columnist (Adam Jadhav, "Swansea lawyer to challenge appointee for judgeship", St. Louis Post-Dispatch, Aug. 25; Nicholas J.C. Pistor, "Lawyer's entry heats up race for appellate court", Aug. 28; "Not recommended" (editorial), Madison County Record, Aug. 18).
