Overlawyered: Chronicling The High Cost Of Our Legal System

Archive for November, 2004

Agenda: gun suit pre-emption, class action reform

The U.S. Senate has been the graveyard of federal liability reform legislation for years now, but yesterday’s election may start upheaving the tombstones in an entertaining manner. The new Senate should be perceptibly more favorable to litigation reform than the old — by three or four votes, at least. Gone, for example, will be the Carolinas’ Ernest Hollings and John Edwards, two lions of the trial bar.

The most obvious impact will be on measures which already commanded a substantial majority of Senators, including many Democrats, but had nonetheless been blocked by parliamentary gamesmanship — specifically, the bill to pre-empt lawsuits against lawful gun sellers over the illegal later use of their products, and the bill to redirect most national class actions into federal courts. Also significant will be the defeat of Senate Minority Leader Tom Daschle, whose tendency to talk like a litigation reformer back home in South Dakota, while working closely with trial lawyer interests in Washington, has been the subject of scrutiny in this space (Apr. 12, Aug. 19, Dec. 18).

Daschle’s defeat may cause prudent Democratic colleagues to rethink the policy of filibustering all major liability measures rather than letting them come to a vote. Also significant is the greatly strengthened hand of organized gun owners in the next Senate, on which see Dave Kopel’s roundup. If the Republicans know what they’re doing, they’ll call up and pass gun-suit pre-emption at an early point, with some version of class action reform not far behind.

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Ballot measure results

As I documented through the night at PointOfLaw.com, voters gave doctors and the business community some major victories in yesterday’s ballot measures. Limits on malpractice lawyers’ fees passed resoundingly in Florida, in a stinging rebuke to the trial bar. Among three other states considering med-mal ballot measures, doctors won decisively in Nevada and lost in Wyoming, while Oregon’s measure was slightly trailing but too close to call. (Update Nov. 9: late returns show one of the two Wyoming measures apparently passing after all.)

In California, in a convincing victory for the business community and good sense, voters approved Proposition 64 by a wide margin, requiring lawyers to demonstrate actual injury before invoking the state’s broad unfair-practices statute in private cases. (Thank you, Arnold.) Colorado voters lopsidedly defeated a trial-lawyer-sponsored measure to expand litigation over alleged construction defects. And in the two hot judicial contests, for seats on the Illinois and West Virginia Supreme Courts, trial-lawyer-backed candidates lost in both. Details on all these races can be found on PointOfLaw.com. Also, voters ignored this site’s advice and passed all eleven state marriage amendments on the ballot.

Finally, some politicians whose ambitions this website has followed were locked in too-close-to-call races: Washington state AG Christine Gregoire (see Oct. 28) was slightly trailing a GOP opponent in her bid for governor, while former trial lawyer lobbyist and Bush HUD secretary Mel Martinez (see Sept. 3) was leading by 80,000 votes in his Florida Senate race against Democrat Betty Castor. (Update: Martinez wins). John Edwards’s vice-presidential ambitions seem at the moment to depend on an unlikely reversal of Ohio results in late vote counting, while his home state of North Carolina went Republican both in the presidential race and in filling Edwards’s old seat. (Update: Kerry and Edwards concede).

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Liveblogging the ballot measures tonight (at Point of Law)

As readers of this site know, voters in six states are considering legal-reform initiatives on today’s ballot. At my other website, the Manhattan Institute’s PointOfLaw.com, I’m planning to post regularly updated live coverage tonight of election returns on the measures, with special attention to any instances where the vote totals prove to be close. (I might also post the odd comment on other races of interest.)

The ballot measures are: Florida’s Amendment 3 (limiting lawyers’ med-mal fees), lawyer-sponsored Amendment 7 (removes confidentiality of medical peer review) and Amendment 8 (strips licenses of doctors who lose three malpractice verdicts); Wyoming’s Amendments C and D (authorizes legislative limits on med-mal awards); Oregon’s Measure 35 (limits med-mal awards); Nevada’s Question Three (limits med-mal awards) and lawyer-sponsored Questions Four (undercuts med-mal reform) and Five (forbids legislative reductions of liability); Colorado’s lawyer-sponsored Amendment 34 (expands right to sue over alleged construction defects), and California’s Proposition 64 (narrows scope of s. 17200 “unfair competition” law).

The timing: Florida polls close at 8 pm EST, Colorado and Wyoming at 9 pm, Nevada at 10 pm, and California and Oregon at 11 pm. I’m in the Eastern time zone, and intend to stay up until 2 am (11 pm Pacific) if that’s needed to follow any still-unresolved contests.

How readers can help: I’ll have access to standard online sources that cover these sorts of votes (big-city papers, Secretary of State websites) but in the past those sources have sometimes been slow to post totals, especially on “down-ballot” issues. I won’t have much access to local broadcast sources, for the most part. If you’ve got fresh news on your state to report, such as a local news organization’s calling a ballot contest one way or the other, email me at editor (at) pointoflaw – dotcom.

Once again, the liveblogging tonight will be going on at Point of Law, not here. [cross-posted from Point of Law, with slight changes][bumped 2:30 pm]

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Latest newsletter

The latest installment of our free periodic newsletter went out this afternoon to its c. 2300 subscribers, covering the last couple of weeks’ worth of postings in telegraphic, even punchy style. It’s a great way to keep up with items you may have missed; when you’re finished, pass on the email to a friend to let them know about the site. Sign up today, right here.

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War of the polling-place lawyers

“Legal battles already have broken out in many states, including battleground states Iowa, Ohio and Florida, as Republicans and Democrats turned to the courts to determine voter eligibility, electronic voting and handling of absentee and provisional ballots. … President George W Bush’s Republican party vowed today it would match or even outnumber the 10,000 lawyers monitoring battleground states for Democratic challenger Senator John Kerry on election day tomorrow.” (P. Parameswaran, “Army of lawyers monitors US poll”, The Australian, Nov. 2). More: Larry Ribstein comments on the prospect of a litigated election (via Bainbridge). And Rick Hasen’s election law blog has much more.

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The Florida myth

It’s one of the most durable stories to come out of the 2000 election: the supposed disfranchisement of black voters in Florida. It’s now a staple of Democratic fund-raising and speeches, despite the virtually complete lack of evidence that any Floridians were intentionally denied their right to vote. (Wall Street Journal (editorial)/Tampa Tribune, Sept. 28).

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GOP lawyers move to shut up radio’s “John & Ken”

Only days after Democratic groups sicced lawyers on Sinclair Broadcasting for considering the airing of anti-Kerry footage, it’s the Republicans’ turn to assault unwanted speech, with the McCain-Feingold campaign finance law serving once again as a bludgeon:

In a complaint to the Federal Elections Commission, the National Republican Campaign Committee accused radio station KFI-AM (640) co-hosts John Kobylt and Ken Chiampou of “criminal behavior” for attacking Rep. David Dreier, R-Glendora, and endorsing his Democratic opponent, Cynthia Matthews.

By criticizing Dreier’s positions on immigration, promoting a “Fire Dreier” campaign and making on-air appeals for voters to elect Matthews, the NRCC said, the hosts gave Matthews an unlawful corporate, in-kind contribution of more than $25,000.

“This behavior is illegal and must be appropriately punished,” the NRCC charged, noting violation of the law carries a penalty of fines and jail time.

(Lisa Friedman, “Action filed vs. radio hosts over talk attacks”, L.A. Daily News, Oct. 29; see Calblog, Oct. 28, and Southern California Law Blog, Oct. 30)

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s. 17200 (and Proposition 64) roundup

More about the Magna Carta for California bounty-hunters known as the Unfair Competition Law or s. 17200, which Golden State voters have a chance to rein in tomorrow by approving the much-needed Proposition 64:

* Attorney Harpreet Brar, whose law firm of Brar & Gamulin was among those to arouse public outrage in the shakedown-lawsuit scandal of 2002-03, has been ordered to pay nearly $1.8 million for filing shoddy lawsuits against small businesses and seeking to settle them quickly for cash (see Aug. 20, 2002) (various news sources, via Legal Reader, Oct. 20);

* Justice David Sills’s spirited dissent in the “Six Screws” case in June (mentioned in my Friday WSJ piece) can be found, along with the majority opinion, here. An excerpt from Sills’s opinion to illustrate the flavor:

What is the difference between the $3 million attorney fees award here and the petty shakedowns which made the Trevor Law Group infamous in Southern California? Nothing but the size of the law firm and its target. As this court noted in People ex rel. Lockyer v. Brar (2004) 115 Cal.App.4th 1315, 1316-1317: “The abuse is a kind of legal shakedown scheme: Attorneys form a front ‘watchdog’ or ‘consumer’ organization. They scour public records on the internet for what are often ridiculously minor violations of some regulation or law by a small business, and sue that business in the name of the front organization.”

Thus, if the Trevor Law Group sues an auto body shop over not having its license up to date, that is an abuse of the unfair competition law. But if a more established law firm sues a big corporation over an equally trivial putative violation — it is rewarded with $3 million in fees. The net result is to bless the same kind of abuse in which the Trevor Law Group engaged — looking for a hypertechnical violation of some law by a California business and then going after that business under section 17200 as a profit-making venture — with appellate holy water.

* Rutan & Tucker attorney Layne H. Melzer has published a succinct guide to the headaches s. 17200 can inflict on an unwary California businessperson (“A Step Toward Disarming California’s ‘Business Practice Bandits'”, undated, at Rutan site (PDF))

* On the other hand, as we mentioned Jul. 7, there’s a whole blog about s. 17200, written by a class action lawyer who has filed many cases using the law. She has published on the blog a description and defense of the law and a post in opposition to Prop 64. (Fixed 11/1 to correct description of blog’s author and to add last-mentioned link.)

* Tim Sandefur (Oct. 28) examines allegations that Prop 64 would impair the enforcement of environmental laws.

* According to the latest Field Poll (Oct. 30, PDF), proponents of Prop 64 have been gaining momentum as the word gets out about the measure. In late September the proposition was behind by twelve points, 26 to 38 percent. Now the deficit has been shaved to five points, 37 percent No and 32 percent Yes, with a gigantic 31 percent of likely voters still undecided. And Gov. Schwarzenegger has started storming the state at rallies to promote his “road trip to reform” which includes a Yes vote on 64, further improving the measure’s chances if its supporters can be made to turn out at the polls.

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