The New Jersey Supreme Court denies recourse to victims of meritless lawsuits.
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Posts tagged as:
loser pays
Disney, Universal and Busch Entertainment weren’t eager to discuss the details of their legal defense but that didn’t stop the Orlando Sentinel from developing a searchable database of 477 state and federal cases filed against the three companies over the years 2004-08. Most cases were slip-falls, very few went to trial as opposed to settling, and in general the companies seemed to enjoy a fair bit of success both at satisfying patrons before their discontents reached the stage of lawsuits and at defending against the suits if brought.
It seems the companies are also willing to utilize provisions of Florida law that go further in the direction of “loser-pays” than do the laws of many other states:
Plaintiffs who lose sometimes end up footing the theme parks’ legal bills. The theme-park companies can, and do, go after unsuccessful plaintiffs, seeking reimbursement for their legal expenses. Under Florida law, anyone who sues anyone else over a personal injury faces this possibility. If the defendant offers a settlement but the plaintiff rejects it and then loses the case (or, in some circumstances, even if the plaintiff wins the case), the defendant can demand the plaintiff pay the defendant’s legal bills.
Reports of other successful defendants pressing their rights under such provisions in Florida or elsewhere are not exactly common, leaving the question of whether 1) the theme parks are making more aggressive use of the Florida rules than other defendants, 2) plaintiffs who go to trial against theme parks are atypical in some way, or 3) other defendants use the fee-shift provisions too, but we just don’t hear about it much.
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The high-profile Canadian free speech advocate (and target himself of the atrocious attentions of Canada’s speech tribunals) has this to say:
Overlawyered.com is a great U.S. website about the American affliction of too many lawsuits. Canada has a simple rule that America lacks, that has made us far less litigious: in Canadian civil courts, the loser has to pay a portion of the winner’s legal fees. That means nuisance suits are far less common.
Which is why human rights commissions are so bad — they remove that damper on frivolous suits, inviting the worst bullies and harassers to abuse the system….
Background:
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The losers of a union election sued the winners in federal district court in Chicago, but it wasn’t a very impressive lawsuit. One plaintiff claimed that the threat of being fired caused an asthma attack, but since she in fact got a raise, and she had been having asthma attacks for 25 years, and there wasn’t any threat, her claim of intentional infliction of emotional distress didn’t get very far. The district court issued $80,000 in sanctions under Rule 11, just a fraction of the $200,000 that the defendants claimed to have paid in legal expenses, but James Gordon Banks objected to even this amount on the grounds that he was poor (though this was in some doubt, because of the assets in his wife’s name) and because he was only recently out of law school. Unfortunately for him, he drew Judge Easterbrook on the appeal, and we know that the judge does not suffer fools lightly:
If Banks really is a bad lawyer (as he depicts himself), and is poor because people are not willing to pay much, or at all, for his services, then he should turn from the practice of law to some other endeavor where he will do less harm. No court would say, in a medical-malpractice action, that a doctor whose low standards and poor skills caused a severe injury should be excused because he does not have very many patients. No more is a bad lawyer excused because he has few clients.
The $80,000 sanction was affirmed, and many took note of the humorous opinion: ABA Journal; UK Times OnLine; Wisconsin Law Journal; Courthouse News.
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- No back-alley bikini lines: New Jersey consumer affairs director rejects proposed ban on Brazilian waxing [Asbury Park Press, JammieWearingFool, Jaira Lima and protest site, Popehat, News12 video] Florida, however, won’t let you get a fish-nibble pedicure [WWSB]
- Kids doing well in homeschool but divorcing dad disapproves, judge says they must be sent to public [WRAL, Volokh]
- Al Franken comes out for loser-pays in litigation (well, in this case at least) [MSNBC "First Read"]
- U.K.: “A man who tried to kill himself has won £90,000 in damages from the hospital which saved his life but hurt his arm in the process” [Telegraph]
- Life in places without the First Amendment: “Australia’s Vast, Scattershot Censorship Blacklist Revealed” [Slashdot, Volokh, Popehat]; British Telecom passes all internet traffic through “‘Cleanfeed” filters to identify (inter alia) racist content [Glasgow Herald]
- More on that suit by expelled student against Miss Porter’s School; “Oprichniki” said to be not identical to Keepers of Tradition [NYTimes; our December coverage]
- “Why We Need Cop Cameras” [Steve Chapman, Chicago Tribune] Shopkeepers terrorized in Philadelphia: “The thugs had badges.” [Ken at Popehat]
- Counting former lobbyists in Obama Administration? Don’t forget Kathleen Sebelius [Jeff Emanuel, RedState]
- Wisconsin: “$50,000 claim filed over girl’s time-out in school” [Milwaukee Journal Sentinel]
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The new king of the infomercial is Vince Offer, whose abrasive ads for, well, $20 rags and overpriced plastic kitchen gadgets have made him millions and won him an extensive YouTube following.
But Offer thinks he’s an actor/writer/director, though has demonstrated little talent for it; his Underground Comedy Movie, starring such lights as Joey Buttafuoco and Angelyne, got risible reviews.
Of note for this page is that he has had even less success as a litigant. In 1998, Offer brought suit against the Farrelly brothers, implausibly claiming that their hit There’s Something About Mary was plagiarized from his movie. (The Farrelly brothers weren’t impressed: “We’ve never heard of him, we’ve never heard of his movie, and it’s all a bunch of bologna.”) Unfortunately, by bringing the suit under federal copyright law, Offer exposed himself to one of the few two-way fee-shifting statutes out there, and a federal judge had little trouble (literally) rubber-stamping a motion for summary judgment and an order requiring Offer to pay over $66 thousand in attorneys’ fees. (Offer v. Farrelly, Case No. CV 98-7697 RAP(RCx) (C.D. Cal. Jan. 13, 2000); id. (Mar. 14, 2000)).
Offer’s also brought suit against Anna Nicole Smith, and issued a press release threatening to sue The Church of Scientology, but I’m not inclined to spend $4.75 to learn about those cases.
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Yesterday the Manhattan Institute unveiled a new study by my colleague there, Senior Fellow Marie Gryphon, entitled “Greater Justice, Lower Cost: How a ‘Loser Pays’ Rule Would Improve the American Legal System” (podcast; Pajamas TV video). It’s got an introduction by former New York mayor Rudy Giuliani, whose endorsement of the idea all by itself counts as a welcome news story, I think. I was part of the panel discussion held to welcome the paper, along with Philip Howard of Common Good, Ted Frank of AEI (and this site), and NYU law professor Mark Geistfeld. Some coverage of and reactions to the study: ABA Journal, AmLaw Litigation Daily, Quin Hillyer @ Washington Examiner, Brooklyn Daily Eagle, Legal NewsLine, Jane Genova, and Jim Copland and Michael Krauss at Point of Law.
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I’ll be on a morning panel discussion sponsored by the Manhattan Institute to discuss a new paper on loser-pays reform by Marie Gryphon. Details here.
Manhattan Institute fellow Marie Gryphon, in National Review, on the state’s loser-pays rule:
Alaska’s unique rule is a product of its history. When the United States purchased Alaska from Russia in 1867, the icy wilderness had so few inhabitants that the U.S. neglected to establish immediately any civil law there at all. Congress instituted a civil legal system for Alaska in 1884 through an Act that borrowed from Oregon’s civil code and applied it to the new territory virtually wholesale. At that time, an Oregon statute allowed the prevailing party in a civil suit to recover attorney’s fees from the loser. While Oregon unwisely dumped its loser-pays rule eventually, Alaska embraced loser pays and stuck with it. …The Alaska Judicial Council conducted a review of Alaska’s loser-pays rule in 1989 and found that, while the law could not deter filings by irrational plaintiffs, it did reduce the number of low-merit lawsuits in Alaskan courts. The Council also found that a majority of Alaskan attorneys liked the system and believed that it functioned well.
(cross-posted from Point of Law).
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The Boston Herald editorializes (Sept. 13) on the “zapped Amtrak trespasser” case discussed here earlier and suggests that loser-pays would help.
Philip Howard’s new online discussion series, New Talk, is back today with a discussion of loser-pays, moderated by Rebecca Love Kourlis. I’m one of the discussants, as is Marie Gryphon of the Manhattan Institute’s Center for Legal Policy, and a galaxy of others, including several law professors who can be expected to oppose the idea strongly. You can tune in here (cross-posted from Point of Law).
More: publicity from Kevin Williamson at NRO Media Blog.
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- Speech tribunal in Alberta, Canada, acquits Ezra Levant over publication of Mohammed cartoons, and it only cost him C$100,000* [National Post, his site, Daimnation]
- Must not cover John Edwards-Rielle Hunter story … must not cover John Edwards-Rielle Hunter story … oh darn!
- U.K. version of a story we’ve seen stateside: noise restrictions threaten roving musical ice cream trucks [Telegraph, Times Online, earlier from NYC]
- “Lawyer Who Says She Was Chastised for Not Being Sweet Is Allowed to Sue” [ABA Journal]
- More thoughts about “going on disability” [White Coat Rants]
- Willie Gary perhaps less than gallant (though undeniably hard-hitting) in countering woman’s claim of sexual assault [WPTV, ABA Journal, Ambrogi]
- Arguing against release, federal prosecutors say millions in assets of two Kentucky fen-phen defendants can’t be traced [Lexington Herald Leader]
- Virginia restaurantgoers looking forward to sangria on sultry evenings [Lindsay Nair, Roanoke Times]
- “It’s true that [veep-buzzed Sen. Bayh] sided with Republicans on tort reform … but do Democrats really want to be the kind of party that makes litmus tests out of those issues?” [Patashnik, TNR "Plank"]
- Third Circuit strikes down ban on “depiction of animal cruelty” as unconstitutional, protecting both bullfight travelogues and those bizarro-fetish “crush videos” [Volokh, our 1999 report]
- Sen. Lieberman brought an outspoken pro-legal-reform voice to the Democratic ticket [eight years ago on Overlawyered]
*Levant can recover nothing from his tormentors because the so-called human rights tribunals are given a special dispensation from the normally prevailing Canadian rule of loser-pays.
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- Texas probate and estate lawyers seldom prosecuted when they steal funds, clients told they should just sue to get it back [Austin American-Statesman investigation]
- About a third of the way down the center strip, then just a bit to the right, you’ll find us on this much-linked map of the campaign season’s most influential websites [Presidential Watch '08]
- Given the enormous liability exposure, would a doctor rationally want a major celebrity as a client? [Scalpel or Sword via KevinMD]
- The loser-pays difference: Canadian franchisees pursue failed class-action claim against sandwich shop Quiznos, judge orders them to pay costs of more than C$200,000 [BizOp via ClassActionBlawg]
- Annals of extreme incivility: judge condemns “heartless attack” at deposition on opposing lawyer’s pin honoring son killed in Iraq [Fulton County Daily Report]
- You keep an open wi-fi connection at home and your neighbor uses it to download music improperly. Are you an infringer too? [Doctorow via Coleman]
- As you’ve probably heard if you read blogs (but maybe not otherwise), one Canadian “human rights” tribunal has dropped action against Mark Steyn and Maclean’s; another still pursuing case [SteynOnline]
- Prison-overcrowding lawsuit could lead to early release of 27,000 California inmates [TalkLeft]
- “He absolutely would’ve gotten this DOJ job but for the anti-liberal bias … and he can’t land any other jobs?” [commenter KenVee on lawsuit over politicized Department of Justice Honors/Intern programs, Kerr @ Volokh, background]
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- High school graduation got rained out in Gilbert, Ariz., and a dad wants $400 from the school district for that [Arizona Republic]
- Happens all the time in one-way fee shift awards, but still worth noting: lawyer in police-misconduct case “billed 22 hours at $480 an hour — a total of $10,560 — just to figure out how much his fees are going to be” [Seattle Times]
- We get to decide and that’s that: New York judge orders that salaries of New York judges including his own be raised [PoL, Bader] Also at Point of Law: white-shoe Clifford Chance throws a party for New York lefties, should anyone be surprised? outsourcing of interrogation to profit-minded private contractors is bad when it’s Blackwater, good when it’s Motley Rice; tax break for trial lawyers said to be blocked for now.
- One firefighter killed in Boston restaurant blaze had sky-high .27 blood alcohol level, the other traces of cocaine, which probably won’t impede the inevitable lawsuit against the restaurant and other defendants [Globe, background]
- Writing again on U.S. exceptionalism, Adam Liptak contrasts our First Amendment with Canadian speech trials; James Taranto thinks he’s siding with the Canadians, but the piece looks pretty balanced to me [NYTimes, WSJ Best of the Web]
- Milberg said to be on verge of deferred prosecution agreement deal with feds involving $75 million payment and admissions of wrongdoing [NLJ]
- Courts in Australian state of Victoria, emulating a model tried in Canada, will resort more to mediation of intractable disputes [Victoria AG Rob Hulls/Melbourne Age]
- Great moments in international human rights: KGB spy on the lam sues British government for confiscating royalties he was hoping to make from his autobiography [five years ago on Overlawyered]
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I’ve previously criticized the unrealistic notions judges have of the expense of litigation. (For example: Budget Rent A Car (7th Cir. 2005).) As I said, “[T]he mistake of thinking that legal practice is so frictionless is what encourages so many judges to deny motions to dismiss and deny motions for summary judgment and fail to restrain discovery.” The Spalding Labs v. ARBICO case, No. CV 06-1157 ODW (SHx), 2008 WL 2227501 (C.D. Cal., May 29, 2008) (via Tushnet) provides another example.
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“Three years ago, Purina sent a cease-and-desist letter to Chow, Baby!, a Baltimore area pet supply shop and Web site owned by Robin McDonald, asserting that its use of the ‘Chow, Baby!’ name was likely to cause confusion with Purina’s CHOW trademarks and would dilute the distinctive quality of those marks. … According to the dictionary, ‘chow’ is defined as food, a meaning that dates back to 1860.” (Carolyn Elefant, Legal Blog Watch, May 2). More from Ron Coleman:
But companies such as Purina are not interested in discussing the matter. Brand management isn’t a seminar. They are interesting in executing and maintaining a policy of complete domination of not only their brand equity space, but a comfortable semiotic buffer all around that space to the full extent that they can get away with it. Judges simply do not award fees or otherwise penalize brand owners for overreaching under the Lanham Act, though the Act empowers them to do so (the exceptions are notable and hence reportable). For this reason it is worth it to Purina and companies like it — it is a rational economic and corporate choice — to litigate these cases at the small risk of actually getting to a final adverse judgment regarding a trademark they have no right to anyway, as weighed against the much higher possibility that the other side will surrender $10,000, $25,000 or even $100,000 worth of fees into the process — dollars that are orders of magnitude more significant to the defendant (or declaratory judgment plaintiff) than for a corporation that probably has counsel on a retainer anyway.
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Another strong reaction from the bench to scorched-earth practices in litigation:
A Massachusetts U.S. District Court judge fined Medtronic Sofamor Danek Inc. and related companies $10 million for the behavior of its trial lawyers at Dewey & LeBoeuf while fighting a patent case brought by DePuy Spine Inc.Senior District Judge Edward F. Harrington also ordered Medtronic Sofamor, which makes spinal implant devices, to pay some of the plaintiffs’ attorney fees. …
“The defendants prolonged the proceedings unnecessarily (thus unduly imposing upon the jury’s time), they sought to mislead both the jury and the Court, and they flouted the governing claim construction as set forth by the Federal Circuit,” Harrington wrote.
(Sheri Qualters, National Law Journal, Feb. 28).
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