Archive for July, 2004

NTSB says no defect, jury says $44 million

“Parker Hannifin Corp. of Cleveland, the world’s largest maker of hydraulic equipment, was told by a Los Angeles jury to pay $43.6 million to the families of three people killed in a 1997 SilkAir crash in Indonesia.

“The Los Angeles Superior Court jury yesterday determined that defects in a rudder control system caused the Boeing 737 to plunge from 35,000 feet, killing all 104 people aboard. The National Transportation Safety Board concluded that there were no mechanical defects and the pilot intentionally caused the crash.” Boeing and SilkAir had already settled out, and the jury refused to apportion any fault to them. “‘We are incredulous,’ said Lorrie Paul Crum, a spokeswoman for Cleveland-based Parker Hannifin, who said the company will appeal. ‘This is the best case for tort reform I’ve seen yet.'” (“Parker Hannifin will appeal jury award”, Akron Beacon Journal, Jul. 8). “The trial established Parker Hannifin’s liability and relatives of about 30 other people will now go to trial in the same Los Angeles court to determine how much Parker Hannifin owes them in damages, [said Walter Lack of Engstrom, Lipscomb & Lack, attorney for the families]”. Parker Hannifin says it plans to appeal. (“SilkAir crash: US firm told to pay US$44m”, Business Times of Singapore, Jul. 9).

They’re using your name! Let’s get ’em!

The central character in a new Tom Hanks movie, “The Terminal”, is a hapless Eastern European tourist by the name of “Viktor Navorski,” a name recalling that of the veteran left-wing author and Nation magazine publisher Victor Navasky. “Whenever a commercial for ‘The Terminal’ appeared on television, my phone would ring and it would be another attorney assuring me that my ship had come in. Clearly I had a case for “misappropriation of my name and likeness,’ ‘expropriation of my right of publicity’ and my favorite, ‘product disparagement.'” (Victor Navasky, “You Say Navorski, He Says Navasky”, Los Angeles Times, Jul. 5).

FDA general counsel under fire

As we noted May 24, trial lawyers are livid about the Food and Drug Administration’s program of filing amicus briefs in liability suits urging state courts not to second-guess the wording of warning labels which the agency had chosen to approve. The battle now seems to be escalating, and is being personalized into an attack on the FDA’s respected general counsel, Dan Troy, who was the target of a press conference thrown the other day by Democratic Rep. Maurice Hinchey of New York. (“U.S. House Democrat Says Agency Aiding Drugmakers”, Bloomberg News, Jul. 13). Jonah Goldberg has more at National Review “The Corner”, as does Jonathan Adler (who excerpts an interesting Jun. 2003 speech by Mark McClellan to the Commonwealth Club in San Francisco discussing pharmaceutical liability).

The fundamental craziness at work here is that an agency like the FDA can spend years considering the best way to balance the risks associated with a drug (including the risk of scaring away patients who would benefit from it); it can decide to require thus-and-such a warning and not some other kind; then, after a drugmaker carefully adopts that exact warning, following the agency’s guidelines in each and every particular, trial lawyers claiming side effects can invite an open-ended series of juries, one at a time, to decide that some entirely different wording should have been used. They need only win occasionally for the game to work financially. Way back in 1988 my colleague Peter Huber explained it very well in his book Liability: The Legal Revolution and Its Consequences, whose relevant chapter was titled: “Knowledge of the Law is No Excuse”. Dan Troy is completely right to call the courts’ attention to the agency’s stake in this problem: let’s hope he outlasts his critics.

Dump this law

“Do you like shrimp but wish it cost more? Need some bedroom furniture but hate getting a good deal on it? If so, you’re very different from most Americans. You are, however, one of the few people who can rejoice in our national trade policies. … The laws against dumping are supposed to correct the problem by banning any imports that are sold below ‘fair value,’ a baffling concept understood by bureaucrats but not economists.” (Steve Chapman, syndicated/Baltimore Sun, Jul. 9).

Santa Monica farmer’s market crash

Speaking of crashing into a crowd of bystanders: “Eleven lawsuits were filed Tuesday on behalf of two people who were killed and nine who were injured when a car plowed through a crowded farmers market last summer.” Named as defendants in the suit by Brian J. Panish, Timothy J. Wheeler and Geoffrey S. Wells are the City of Santa Monica; “the company that oversees the market, a farmers association, Los Angeles County’s agricultural commissioner and the state of California”; and General Motors. Oh, yes, and the actual driver, 88-year-old George Russell Weller; almost forgot him. (“Lawsuits filed in Santa Monica farmers market car crash that killed 10”, AP/San Francisco Chronicle, Jul. 13; “Greene Broillet Files 11 Lawsuits Against the City of Santa Monica for Wrongful Deaths and Personal Injuries Arising out of the July 2003 Santa Monica Farmers’ Market Tragedy”, press release, Jul. 13). In all, ten people were killed and 63 injured in the accident last July. (& see Sept. 15).

Welcome National Journal, Salon, Dallas Morning News readers

Stuart Taylor, Jr. takes a hard look at the Kerry/Edwards ticket and weighs the likelihood that it will do much to rein in the litigation biz. Quotes my comment comparing Sen. Edwards to a cleaned-up Michael Moore (“Edwards and the Problem with the Trial-Lawyer Lobby”, National Journal/Atlantic Online, Jul. 13). At Salon, reporter Tim Grieve pens an all-out defense of Edwards which is kind enough to quote me in two places (“The GOP war on trial lawyers”, Jul. 13 (subscription or ad-based “day pass”)). And the Dallas Morning News, in the person of editorial columnist Rod Dreher, includes this site in a short list of recommended weblogs, coincidentally quoting an item of mine on locally based lawyer Fred Baron and his involvement with this year’s Democratic ticket (“Welcome to the blogosphere”, Jun. 23).

Products we don’t see

“Another measure of the magnitude of the high cost of lawsuit abuse is the number of products and services that have been withdrawn from the U.S. market due to fear of liability, irrationally applied. Volvo, for example, makes an integrated child booster seat that is not sold in the U.S. because of product liability concerns….

“Similarly, fears of silicone implant lawsuits in America caused Japanese silicone makers to quit production of silicone coating for hypodermic needles, which reduces the pain of an injection. The director of one of these firms stated, ‘We’re sure our product is safe, but we don?t want to risk a lawsuit.’…

? Monsanto Company abandoned the planned production of a safe, biodegradable, and effective reinforcing phosphate fiber that would have been a substitute for asbestos.

? Union Carbide decided to forego developing a suitcase-sized kidney dialysis unit and offering intravenous equipment.

? Sunstar, a health-spa manufacturer, decided not to market a safety device due to a liability-related increase in its insurance costs. The product would have set off an alarm every time the cover of a spa was opened. Because the product was a safety device, only one insurance company was willing to write a policy.

— Excerpted from Steven B. Hantler (DaimlerChrysler Corporation), “The Seven Myths of Highly Effective Plaintiff’s Lawyers”, Manhattan Institute Civil Justice Memo #42, Apr. (PDF) (more on paper)