Overlawyered: Chronicling The High Cost Of Our Legal System

Archive for 2003

Kinsley: GOP is right on malpractice

“The current arrangement delivers justice at random, in widely varying amounts or not at all, depending on whether you’re feeling litigious, how good your lawyer is, or what a judge or a juror had for breakfast that day. … It is a society with an odd sense of justice that awards millions of dollars to every 25th victim of what may or may not have been a botched operation, but doesn’t guarantee basic health care to anyone.” (“The lawsuit lottery”, Slate, Jul. 10).

The Senate’s failure to invoke cloture on medical litigation reform proceeded on strict party lines, with no Democrats voting for and only two Republicans voting against, Shelby of Alabama (no surprise there) and Lindsey Graham (R-S.C.). (Helen Dewar, “Medical Malpractice Bill Dies in Senate”, Washington Post, Jul. 10). What’s with Graham? — wonders Wyeth Wire.

MedPundit Sydney Smith as usual offers omnibus coverage of the malpractice debate, including a new column of her own (“The Threat to Medical Innovation”, TechCentralStation, Jul. 11); a new study from researchers at the Agency for Healthcare Research and Quality finding that states with liability caps “experienced a more rapid increase in their supply of physicians” than states without; a funny Scrappleface satire on how doctors should start prescribing cash as a remedy for pain and suffering since that’s what the government considers suitable (Jul. 8, and read the comments); a critique of a typically benighted treatment of the subject in The American Prospect; and more (scroll down, too).

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Update: San Antonio evidence-faking and witness-tampering case

The Texas case we covered on May 23 and Jun. 26, 2000 and Mar. 17 of this year has now eventuated in a suit by DaimlerChrysler against the Kugle Law Firm. A trial court dismissed the Kugle firm’s $2 billion suit against Chrysler and imposed sanctions of $865,000 against three of the firm’s lawyers after finding that the steering decoupler of the sued-over Dodge Neon had been altered to simulate mechanical failure and that Mexican policemen had been asked to change their accounts of the accident giving rise to the suit. An appeals court called the firm’s conduct ‘an egregious example of the worst kind of abuse of the judicial system.'” “The senior lawyer at the firm, Robert A. Kugle, has been suspended from the Texas bar and has moved to Mexico. He could not be located for comment.” (Adam Liptak, “Law Firm Is Sued Over Conduct in Liability Case”, New York Times, Jul. 10; AP/Miami Herald; San Antonio Express-News). More: David Giacalone at EthicalEsq.? weighs in.

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Merrill Lynch cases tank

Whoops, there goes another Eliot Spitzer project: last week federal judge Milton Pollack dismissed investor lawsuits against brokerage Merrill Lynch based on emails dug up by the New York AG and widely billed in the press at the time as “smoking guns” providing “slam dunk” litigation potential for private plaintiffs. “Judge Pollack used scathing language in his decision in favor of Merrill Lynch released Tuesday in which he explained why he thought plaintiffs had no case. He described the plaintiffs as ‘high-risk speculators’ who lost their money ‘fair and square’ during the bull market of the late 1990s. (Greg Cresci, “Investors blaming Wall Street should think again”, Reuters/Forbes.com, Jul. 2). Meanwhile, a bill pushed by Wall Street firms in Congress would rather cleverly direct the proceeds from massed state-AG regulatory actions away from state budgets and toward the putative victims, namely investors (via the federal Securities and Exchange Commission). State governments in general were not big losers from the challenged Wall Street practices, yet Spitzer’s settlement arranged to spray large sums of money in their direction, winning him lots of gratitude-chits from the political class. Spitzer and his friends are howling foul at the proposed change, thus raising the question of to what extent their crusades have really been motivated by the welfare of mom-and-pop investors after all (Greg Farrell and John Waggoner, “House bill would steer Wall Street fines away from states”, USA Today, Jun. 10). More: a New York Times follow-up points out that what got thrown out were cases brought by nonclients of Merrill, an unusually lame category of claimant, and that actual Merrill clients can still proceed on claims that they lost money relying on deceptive research, though some of the judge’s findings, such as that Merrill’s research was “replete with risk warnings”, will still prove helpful to the firm in defending those claims. (Landon Thomas Jr., “Legal Reprieve for Wall Street Is Not Likely to Last Long”, New York Times, Jul. 4)

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Viacom, Spike Lee kiss and make up

But not until after a publicity bonanza for both sides. Filmmaker Shelton Lee (see Jun. 16-17) now says “I no longer believe that Viacom deliberately intended to trade on my name when naming Spike TV. As an artist and a filmmaker, I feel that protection of freedom of expression is a critical value, and I am concerned that my efforts to stop Viacom from using the Spike TV name could have the unintended consequence of threatening the First Amendment rights of Viacom and others. I am pleased to be able to resolve this matter and be able to work with Viacom on new projects”. (Buzz Johnson, “Spike Lee and Viacom Settle”, FilmStew.com; Washington Post; Hollywood Reporter/Reuters). Earlier, the son of musician Spike Jones filed court papers in the case, saying (per AP) “it is ‘frightening’ that filmmaker Spike Lee is trying to claim exclusive ownership of the name ‘Spike.'” (see The Legal Reader, Jun. 24).

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El Paso case: $60 m payday for Lockyer chums

“The latest settlement in litigation over California’s energy crisis includes tens of millions of dollars in attorney fees to be shared by a handful of politically savvy plaintiffs’ firms. … Besides Lieff Cabraser, private firms that will collect a share of the fees include Kiesel, Boucher & Larson of Beverly Hills, Calif., and Girardi & Keese; Engstrom, Lipscomb & Lack; and O’Donnell & Shaeffer, all of Los Angeles. ” (Jeff Chorney, “Powerful Payday”, The Recorder, Jul. 8).

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“Wheelchair ramps in the high alpine zone”

At The New Criterion’s newly launched weblog Armavirumque, James Panero tells how the Americans with Disabilities Act led to the installation of a wheelchair ramp at Galehead Hut in northern New Hampshire, which is “perhaps the most inaccessible” of the Appalachian Mountain Club’s historic system of White Mountain huts and can be reached only by hiking over very rugged terrain (Jul. 7).

Also via Armavirumque (Jul. 8), Theodore Dalrymple on the premise behind fast-food lawsuits: “Left to his own devices, the denizen of hamburger restaurants would eat fresh carrots and brown rice, his natural choices. … This picture is of a world in which humanity as a whole is good, but is so innocent that it is diverted from the paths of righteousness by a few evilly disposed persons such as the directors of food companies. Were it not for them, we should all be thin as rakes and fit as fleas.” (“The Devil’s Food Cake Made Me Do It”, National Post (Canada), Jul. 5).

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Hormel vs. Spam Arrest

The meat purveyor is asserting trademark rights: “Claiming dilution of the trademarked name Spam, the company has filed complaints against Spam Arrest LLC, a Seattle technology company that provides spam-blocking software for e-mail users.” (Jonathan Krim, “Hormel Foods challenges Spam Arrest’s trademark bid”, Washington Post/Chicago Tribune, Jul. 7).

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Samuelson on Nike v. Kasky

Washington Post columnist Bob Samuelson chastises the U.S. Supreme Court majority for ducking the recent free-speech-for-business case (see Ted Frank’s post of Jul. 1, as well as Feb. 13 and May 3-5, 2002). Sample: “Just about the last people you’d want to put in charge of the First Amendment are trial lawyers, whose business is suing large companies on any available pretext. … What’s occurring here is that trial lawyers are road-testing a new form of corporate shakedown. First, advocacy groups would attack a company or industry. Next, companies would face a dilemma: be silent and let the attacks stand, or respond and face an expensive and embarrassing suit. Finally, companies that ended up in court might face a daunting standard of proof — not whether what they said was true, but whether it might be misleading.” (Robert Samuelson, “A Tax on Free Speech”, Jul. 9). Before the Court issued its ruling, interesting columns about the case also appeared from Jonathan Rauch (“Corporate Lying is Bad”, National Journal/Reason.com, Jun. 9) and Dan Kennedy (“The Silent Swoosh”, Boston Phoenix, May 2-8). Update Sept. 14: Nike settles case.

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Firestone II

The National Law Journal also has coverage of a “groundbreaking” Judge Easterbrook decision out of the federal appellate court in Chicago, In re Bridgestone/Firestone Inc. Tires Products Liability Litigation, holding that a federal decision against the creation of a nationwide class precludes state courts from deciding to the contrary. (John Beisner of my law firm, O’Melveny & Myers, represented Ford Motor Company and argued for the defense.) The decision is important because it limits the ability of class action plaintiffs’ attorneys to judge-shop; if a federal court denied the certification of a nationwide class, the same attorneys could go from state to state seeking a state court that would in a game of “heads I win, tails don’t count.” (Gary Young, “7th Circuit Limits State Court Certification of Class Actions,” National Law Journal, July 8.)

Many thanks to Walter Olson for giving me the keys to the website for the week. I greatly enjoyed the experience.

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