The WSJ Law Blog reports that the two Yale Law women suing AutoAdmit/XOXOHTH posters are “seeking to resolve their claims against these defendants” without amending the complaint to name their identities, obtained over the course of a variety of subpoenas.  Thus, the recent amended complaint named only a single AutoAdmit poster, Matthew C. Ryan, who had apparently refused to settle–perhaps because while Ryan’s comments were obnoxious, they were not legally actionable.

Someone correct me if I’m wrong, but isn’t it historically the case that someone who says “Pay me money or I will file a lawsuit and issue press releases that reveal private facts you find to be embarrassing” guilty of blackmail or extortion in other contexts?  What distinguishes this case–especially when the underlying allegations are so legally flimsy?

Sealed Air makes polyethylene foam for packaging material. The Great White plaintiffs allege that polyethylene foam in the soundproofing was part of the reason the Rhode Island Station nightclub fire spread so fast, killing 100–though they have no evidence that Sealed Air manufactured the foam in the club, not to mention the fact that the packing foam was never intended to be used as building material. Not to worry: with joint and several liability in Rhode Island, Sealed Air faced billions of dollars of potential liability because all of the other deep pockets (dozens of defendants ranging from a radio station to four other foam manufacturers to Anheuser-Busch to the bus that transported the band to the concert to a television station that covered the fire) have settled, Sealed Air couldn’t risk being held even 1% liable, especially given that at a trial plaintiffs would have no incentive to blame empty-chair or empty-pocket or settling defendants. Sealed Air will pay $25 million in protection money. (AP; Providence Journal; TortsProf). The miscarriage of justice continues, but the remaining defendants are apparently judgment-proof.

Full proof that I don’t think all pro se representation is a bad thing: Following up our previous discussion of the GTA class action settlement and my objection: This morning, Friday, June 6, I filed this brief (which unlike the previous brief, I wrote myself), in opposition to the plaintiffs’ motions for court approval of the settlement and attorneys’ fees, in the Southern District of New York and served it upon counsel. With luck, I didn’t file the wrong brief.

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If you wonder why insurance fraud and insurance expense are so high in New York state it’s because of opinions like AA Acupuncture Service v. State Farm Mutual Insurance Company. (The fact that the plaintiff is a quack-upuncturist immediately suggests problems, no?) Civil Court Judge Arlene P. Bluth agreed that there was “uncontradicted, overwhelming circumstantial evidence” that an accident had been faked. But State Farm was still not entitled to summary judgment on the litigation of bad-faith claims by three medical providers who insisted that State Farm was liable as the insurer of the woman who claimed to have been injured in the accident. (Plaintiffs deny fraud, though apparently wasn’t able to rebut the evidence of fraud at the motion stage.)

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Lisa Brockington hired employment-discrimination firm Tuckner, Sipser, Weinstock & Sipser to represent her in a discrimination lawsuit, and was impressed with her resulting settlement enough that she joined the firm as an office manager. But now Brockington is suing Tuckner, Sipser, Weinstock & Sipser on sexual harassment grounds, making a number of lurid accusations about the firm and about Jack Tuckner’s sexual practices (which the New York Post and Above the Law are kind enough to highlight for one’s titillation). Either the allegations are true, in which case the firm suffers from severe hypocrisy problems in addition to its legal troubles, or the allegations are false, in which case the firm wins settlements for plaintiffs who make false claims. Tuckner’s attorney, David Berlin, does indeed say the claims are false. More precisely, he says “[T]hese irrational and untrue charges are a reflection of the person bringing the charges.”  Brockington’s attorney is Louis Pechman. Tuckner regularly appears on television as a talking head on harassment law.

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Public Citizen’s attack on arbitration highlights the case of Alex Karakhanov. Public Citizen’s take on the anecdote demonstrates why Public Citizen has no business calling itself a consumer advocacy group.

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AP reports a Texas court has thrown out the infamous Ernst $26 million judgment; a New Jersey court has tossed $9 million of the judgment in McDarby. More details on Point of Law as available.

Ernst was the first Vioxx suit to go to trial. A jury awarded $253 million. Mark Lanier waited months before asking for a final judgment; at the time, I suggested that this was because he knew the case would be reversed on appeal, and did not want the bad publicity. Indeed, the appellate decision perhaps comes too late for Merck: the number of lawsuits increased from 6000 to 60000 in the months following publicity over the jury verdict, costing Merck billions of dollars in the later extortionate settlement.

With these two decisions, only three plaintiffs’ verdicts in favor of Merck remain.

Update: I still haven’t seen the McDarby decision, but an updated AP story indicates that it upheld the compensatory damages of $4.5 million, overturned the $9 million punitive damages verdict, and overturned the consumer-fraud judgment (which also saves Merck millions of dollars in plaintiffs’ attorneys’ fees).

A customer complained to the staff that a man was in the women’s restroom in the Greenwich Village restaurant Caliente Cab Co. Given the risk of multi-million dollar liability of failing to act in the face of a warning if a customer were assaulted by a man in the women’s restroom, a restaurant bouncer ejected Khadijah Farmer, Khadijah’s girlfriend, and a third in their dinner party.

Unfortunately for the restaurant, Khadijah Farmer was not a man, but an extraordinarily masculine-looking lesbian (who says she is mistaken for a man on a “daily basis”).

Further unfortunately for the restaurant, New York City has an unusual law prohibiting discrimination on the basis of “sexual stereotyping.” Further further unfortunately, Ms. Farmer wasn’t satisfied when the restaurant offered her a free meal in response to her complaint, and went straight for the lawyers. Further further further unfortunately, a top-tier law firm agreed to work the case “pro bono,” assigned three attorneys to it, and ran to the courthouse, even after the restaurant agreed to sensitivity training for its employees.

Let’s agree: the bouncer made a mistake and should have taken the opportunity to look at Farmer’s ID. Women shouldn’t be thrown out of women’s restrooms for looking like men, though one who looks as masculine as Farmer has to reasonably expect questioning unless we’re going to go the unisex bathroom route.

Damned if it does, damned if it doesn’t; up against a law firm using a bazooka to kill a mosquito; and in a neighborhood where being on good terms with the gay community is important for business relations, the restaurant, facing weekly pickets from the Queer Justice League, rolled over and settled for $35,000 + $15,000 in attorney’s fees, which will eventually be extracted from the restaurant’s clientele in the form of higher prices. (Jennifer 8. Lee, “Sexual Stereotypes, Civil Rights and a Suit About Both”, NY Times, Oct. 10; Jennifer 8. Lee, “Woman Wins a Settlement Over Her Bathroom Ouster“, NY Times, May 14; Andy Humm, “Calls to Boycott Caliente Cab Company”, Gay City News, Jul. 19).

I ate at the Caliente Cab Co. on Bleecker in the summer of 1988 when I lived on 12th and University; next time I’m inclined to eat there, I’ll let them throw me out of the restaurant for a fraction of what they paid Ms. Farmer. (Similarly: Gothamist commenters.)

The good news is that the legal problems of New York’s poor and non-profits have been so thoroughly resolved that a law firm can devote substantial pro bono resources to punitively harassing a small business over a bouncer’s not especially unreasonable misunderstanding, and has successfully trained a couple of young associates that they can file a lawsuit to extract tens of thousands of dollars over a $50 dispute. Do Morrison & Foerster’s clients know that this is the kind of litigation they’re subsidizing?

Previously on pro not-so-bono: October 2004.

John Stossel has a WSJ op-ed and tv special tonight on the problem of extortionate attorneys. Overlawyered previously discussed the Selbin case and I’ve written about Bill Lerach’s extortion of banks in the Enron case.

• Easterbrook: “One who misuses litigation to obtain money to which he is not entitled is hardly in a position to insist that the court now proceed to address his legitimate claims, if any there are…. Plaintiffs have behaved like a pack of weasels and can’t expect any part of their tale be believed.” [Ridge Chrysler v. Daimler Chrysler via Decision of the Day]
• Retail stores and their lawyers find sending scare letters with implausible threats of litigation against accused shoplifters mildly profitable. [WSJ]
• Kentucky exploring ways to reform mass-tort litigation in wake of fen-phen scandal. [Mass Tort Prof; Torts Prof; AP/Herald-Dispatch; earlier: Frank @ American]
• After Posner opinion, expert should be looking for other lines of work. [Kirkendall; Emerald Investments v. Allmerica Financial Life Insurance & Annuity]
• Judge reduces jury verdict in Premarin & Prempro case to “only” $58 million. And I still haven’t seen anyone explain why it makes sense for a judge to decide damages awards were “the result of passion and prejudice,” but uphold a liability finding from the same impassioned and prejudiced jury. Wyeth will appeal. [W$J via Burch; AP/Business Week]
• Judge lets lawyers get to private MySpace and Facebook postings. [OnPoint; also Feb. 19]
• Nanny staters’ implausible case for regulating salt. [Sara Wexler @ American; earlier: Nov. 2002]
• Doctor: usually it’s cheaper to pay than to go to court. [GNIF BrainBlogger]
• Trial lawyers in Colorado move to eviscerate non-economic damages cap in malpractice cases [Rocky Mountain News]
• Bonin: don’t regulate free speech on the Internet in the name of “campaign finance” [Philadelphia Inquirer]
• “Executives face greater risks—but investors are no safer.” [City Journal]
• Professors discuss adverse ripple effects from law school affirmative action without mentioning affirmative action. Paging Richard Sander. Note also the absence of “disparate impact” from the discussion. [PrawfsBlawg; Blackprof]
• ATL commenters debate my American piece on Edwards. [Above the Law]

My latest Liability Outlook is on the Patent Reform Act of 2007:

Despite some in the media calling patent reform dead, on January 24, 2008, the Senate placed S. 1145, the Patent Reform Act of 2007, on the general calendar. The next few weeks will be critical to the legislation, which the House passed in September. Although much of the discussion has focused on the different perspectives and concerns that the high tech and the biotech/pharma industries have about the legislation, the fact remains that the patent litigation system is broken. Congress should make every effort to fix it by writing into this legislation reasonable formulas for damage awards and venue rules that discourage forum-shopping. …

Affiliates of Erich Spangenberg’s Plutus IP have sued 476 different defendants in 42 lawsuits. The vast majority of those lawsuits allege infringements of patents that Plutus IP purchased for $1,000. The use of invalid patents in litigation is more than theoretical. Philip Jackson sued his attorneys, Chicago plaintiffs firm Niro, Scavone, Haller & Niro, for malpractice after his $12.1 million jury verdict against Glenayre Electronics Inc. was reduced to under $3 million; Niro challenged the malpractice suit by claiming that th e patent Jackson had successfully enforced was invalid. In 2006, approximately 6,000 defendants were sued in 2,800 patent cases; in 2007, the six thousand mark was reached in early October, implying a 30 percent increase in patent litigation in a single year. Such litigation stifles substantial technological innovation. Patent trolls claim to block entire fields, and one cannot hope to innovate in these areas without the financial capital to handle the threat of patent litigation. IBM has 370 corporate patent attorneys, not just to avoid the pitfalls of infringement, but to create a patent portfolio that can provide counterclaims (or cross-licensing opportunities) if a commercial entity were to sue them for infringement. Since the late 1990s, patent litigation costs have outstripped patent profits.

(Updating and bumping Feb. 4 post about to roll off bottom of page because of new comment activity)

• Judge Fallon denied the motion of Florida plaintiffs to expedite a hearing on their inclusion into a settlement when they did not even bring suit (Jan. 30). Merck and the PSC are required to respond Feb. 15, and the hearing will be Feb. 21, where one can expect the motion to be denied.
• At Point of Law, I comment on the recent grand jury investigation into Merck marketing of Vioxx.

Update, Feb. 8: separately, Merck yesterday settles for $650 million different Medicaid fraud allegations over the marketing of Vioxx and other drugs. The qui tam relator will get a jackpot award of $68 million. [WaPo; DOJ; Merck] The pricing theories at the center of these lawsuits—which hold Merck liable for purportedly charging too little—definitely deserve longer discussion another time.

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Back in 2005, when the first lawsuits were filed over the Grand Theft Auto hot coffee mod, I wrote:

Me, I’m just amused by the thought of class action attorneys trolling for a named plaintiff parent who will testify that, while she was okay for her little Johnny to buy a game involving drug dealing, gambling, carjacking, cop-shooting, prostitution, throat-slashing, baseball-bat beatings, drive-by shootings, street-racing, gang wars, profanity-laced rap music, violent homosexual lovers’ quarrels, blood and gore, and “Strong Sexual Content,” she is shocked, shocked to learn that the game also includes an animation at about the level of a Ken doll rubbing up against an unclothed Barbie doll with X-rated sound effects…

Alas, Take Two games has given in to the blackmail and settled the case, but a sense of how frivolous it was can be seen from the following deposition excerpt of lead plaintiff Brenda Stanhouse, a schoolteacher in Belleville, Illinois, who will receive $5000 for her role in the litigation. Recall that Mrs. Stanhouse is alleging she was defrauded because she would not have bought a game that could be modified to include “pornography,” but take a look at pp. 67 ff. of the deposition, where she makes clear she didn’t have the faintest idea what was in the game that she did buy. Readers: type your favorite Stanhouse deposition excerpts in the comments.

My op-ed on the Supreme Court’s denial of cert in the Enron class action is in today’s New York Sun.

Libertarian medical school blogger “Frommedskool” has been critical of the Vioxx litigation (regularly citing to our coverage at Point of Law). An April 2006 post about the Cona/McDarby case, however, appears to have generated a December 2007 comment from someone calling himself Mark Lanier, the plaintiffs’ attorney in the case:

Third, there was a huge amount of info Merck had that it never gave the FDA, there were smoking gun memos and emails, and there was huge harassment of the medical community done by Merck. For example, Merck did a full meta-analysis of placebo trial that showed a statistically significant increase in heart attacks, but Merck excised that from the report given the FDA. Even Merck’s head admtted they should have given the analysis to the FDA.

(Point of Law discussed the so-called withholding of the meta-analysis back in 2006. It wasn’t all that.) Fascinatingly, this comment immediately provokes comments from another lurker (just two hours later?!) claiming to be a plaintiff, reasonably asking why, if the evidence was so good, Lanier was agreeing to settle 47,000 plaintiffs’ cases for under $5 billion, essentially a nuisance settlement given that victorious plaintiffs were being awarded in the millions and tens of millions.

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Please register for this event online at http://www.aei.org/event1626.

The AEI Legal Center for the Public Interest and the Federalist Society present:

The Vioxx Settlement

Monday, January 7, 2008, 12:00 p.m.–2:00 p.m.
Wohlstetter Conference Center, Twelfth Floor, AEI
1150 Seventeenth Street, N.W., Washington, D.C. 20036

In 2004, Merck withdrew its pain reliever Vioxx from the market because of new studies showing increased cardiovascular risk. Merck announced that it would not settle any of the tens of thousands of Vioxx lawsuits filed, and set aside over a billion dollars to litigate cases without reserving a penny for damages. After a $254 million verdict in the first Vioxx trial in 2005, some observers predicted over $25 billion in liability for the company. Fifteen trials later, Merck and the plaintiffs’ attorneys announced a settlement of the outstanding personal injury litigation—for under $5 billion. Merck stock rose after the announcement, and is now higher than before it withdrew Vioxx from the market. But some law professors are arguing that a new and unusual provision in the settlement raises ethical concerns.

Why did Merck settle? And why was the settlement for so much less than originally anticipated? Is the Merck settlement different from the Wyeth fen-phen settlement, which was originally announced as a $3.75 billion settlement, but has so far cost more than $20 billion? Will the settlement stand up under legal challenge, and what will remain of the Vioxx litigation if it does?

At this event cosponsored by AEI and the Federalist Society, a panel of experts will explore these and other questions. Speakers include Vanderbilt law professor Richard Nagareda, author of Mass Torts in a World of Settlement; Virginia legal ethics professor George Cohen; author and leading pharmaceutical mass torts defense attorney Mark Herrmann; Andy Birchfield, a member of the Vioxx Plaintiffs’ Steering Committee; and Ted Frank, director of the AEI Legal Center for the Public Interest. AEI resident scholar John E. Calfee will moderate.

11:45 a.m.
Registration and Lunch

12:00 p.m.
Panelists:
Andy Birchfield, Beasley Allen
George Cohen, University of Virginia School of Law
Ted Frank, AEI
Mark Herrmann, Jones Day
Richard Nagareda, Vanderbilt University Law School

Moderator:
John E. Calfee, AEI

2:00 p.m.
Adjournment

Perhaps one reason trial lawyers so frequently accuse reformers of manufacturing popular outrage is because such astroturfing is a common trial-lawyer tactic: Peter Lattman uncovers eight identical letters to the editor written at the behest of the Association of Trial Lawyers of America (now going by the AAJ misnomer), all on behalf of Bill Lerach’s bogus Enron suit and criticizing the Bush administration officials who dare to stand up to the attempted extortion. Similar astroturfing regularly goes on in the comments section of the Lattman blog.

WSJ Law Blog has the (long) opinion and (short) judgment in the case. Professor Bainbridge notes the pertinence of the legal principle of “puffery”, under which Pearson was no more justified in demanding the literal enforcement of the Chungs’ “Satisfaction Guaranteed” sign than would other customers be justified in suing United Air Lines after a grumpy flight for not providing “friendly skies”, Exxon for not putting a genuine “tiger in your tank”, Fox News for being less than “fair and balanced”, and so forth. Amygdala observes, of the $12,000 settlement offer that Pearson spurned from the Chungs:

Which is to say, if you’re a lawyer, or just knowledgeable about legal phrasing and documents, and willing to spend a certain amount of time generating and mailing documents, you can wind up being offered $12,000 if you’re sufficiently obnoxious and persistent, no matter how feeble, frivolous, and meretricious your claim is.

That’s a well-known, old, story, to be sure, but still worthy of note now and again.

And the WSJ Law Blog has an earlier interview with the Chungs’ lawyer, Christopher Manning, including this pertinent excerpt:

How’d all the publicity start?

A local neighborhood newspaper first picked up the story. Then WJLA – the local ABC affiliate — picked up the story, with me holding the pants. After that, Marc Fisher’s [Washington Post] column ran in late April which really set it off. [The story has since been featured on Today, Nightline, Good Morning America, MSNBC, Fox News, CNN and a host of other networks.]

Gosh. You mean the pants suit didn’t become a big worldwide story, as some of our friends in the trial bar have hinted, just because those nefarious legal reformers were looking for a far-out case to publicize? Next you’ll be telling us that Stella Liebeck’s McDonald’s hot-coffee award became a huge story because it was something the press found newsworthy and the public wanted to talk about, rather than because reformers plotted deep into the night to hype it.