Archive for January, 2006

A Million Little Plaintiffs

An acquaintance—whose self-accounts have appeared in several books, radio stories, prominent magazines and web publications—published a short story in a “non-fiction” anthology. I was familiar with the underlying events and asked her about it, since, even aside from unacknowledged name-changes, it plainly had invented and exaggerated elements, and a twisted chronology meant to fit a story arc. “Of course it does. It’s creative non-fiction,” she responded in exasperation, introducing me to a new definition of “non-fiction” that I hadn’t previously been aware of.

So the James Frey scandal (or a smaller one involving the Times’ Modern Love section) doesn’t surprise me in the slightest; I’ve just come to assume that anything published under the memoir label in the twenty-first century is the modern-day equivalent of a Philip Roth novel that isn’t well-written enough to be successfully marketed as fiction.

The question is what will a court do when confronted with the inevitable free-riding class action, claiming that the publisher has committed consumer fraud, and demanding the right for every book owner to get a full refund and punitive damages (and, of course, a taste for the attorneys who took the entrepreneurial risk of typing up a summary of The Smoking Gun story and filing it in court), before settling for 50-cent coupons, a donation of remaindered books to a “Books for Addicts” program, and a multi-million-dollar attorney fee. Will there be a ruling that “non-fiction” memoirs that aren’t require labelling? If so, what are the First Amendment implications for other non-fiction books? A ruling that doesn’t provide a clear swath of protection for publishers could essentially abolish memoirs or first-person reporting, because a ruling that establishes any sort of rule calling Frey’s book consumer fraud (or even just potentially actionable consumer fraud) could encourage other attempts to sue other successful memoir-publishers for less egregious exaggerations. (This problem earlier arose with the Beardstown Ladies (Nov. 16, 1999), and the California Court of Appeal was far from sympathetic to the First Amendment issues.)

Random House appears to be attempting to pre-empt litigation by offering refunds to anyone who asks, which will surely be a smaller percentage of customers than a hired plaintiffs’ damages expert would testify to.

Prawfsblawg asks about Frey’s liability to the publisher, which seems to miss the point: what’s the publisher’s theory of damages? “You sold us a book that made us a lot of money”?

Also of interest to Overlawyered readers is the bullying letter sent by Frey’s lawyer to The Smoking Gun to try to keep them from publishing their findings. We may have our own story of bullying letters to tell shortly.

(And welcome Wall Street Journal and Malkin readers; do check out our main page and sister site.)

Indian land claims: give us Denver

We’ve covered this set of issues numerous times in the past, but here are some fresh details:

When the Indian Gaming Regulatory Act became law in 1988, no one imagined that it would become a Trojan Horse that would deliver Las Vegas-style casino gambling into communities across America. Having saturated local markets, many tribes are now seeking to acquire land near other, sometimes-distant, population centers, and converting it to “sovereign” territory, in an effort to shoehorn casinos into areas where they’re often not wanted by local populations. Once land becomes part of a reservation, it typically becomes exempt from local taxes, state labor laws, municipal ordinances, zoning restrictions and environmental review. In one of the most egregious cases, in 2004, the Cheyenne-Arapahoe Tribes of Oklahoma filed a 27 million acre land claim which included all of Denver and Colorado Springs, but offered to drop it in exchange for the approval of a Las Vegas-style casino near Denver Airport.

“These efforts are being funded by ‘shadowy’ developers who underwrite the litigation expenses, lobbyist fees and even the cost of land in exchange for a cut of the profits,” James T. Martin, the executive director of the United South and Eastern Tribes, told the Senate Committee on Indian Affairs in May 2005. “If even one of these deals is approved, the floodgates for this kind of ‘reservation shopping’ will open throughout the country.” (Mr. Martin, it should be said, is no opponent of gambling: his organization includes tribes whose main goal is to thwart new competition against their own casinos.)

(Fergus M. Bordewich, “The Least Transparent Industry in America”, Wall Street Journal, Jan. 5)(subscriber-only).

Cereal-serving restaurants

Watch out if you try to open one — you might risk infringing someone’s “business method” patent. (Chris Hayes, “Snap, Crackle … Patents”, In These Times, Jan. 2)(via Reason “Hit and Run“).

P.S.Victor Serby, in comments, notes what he calls a “glaring factual error” in Hayes’s account and points out that a patent application is a very different thing from a valid patent.

Vexatious litigant jailed for contempt

“Former Steamboat Springs [Colo.] resident Kay Sieverding, who has been in jail since September, was released Wednesday after she agreed to dismiss her numerous federal lawsuits.” U.S. District Judge Edward Nottingham had ordered Sieverding committed to jail for contempt of court after she continued to file lawsuits he described as “frivolous”, “abusive” and “gibberish”, including refilings of lawsuits she had already lost. “Sieverding has filed lawsuits against not only her former neighbors but also Steamboat Springs officials, the local newspaper, several individual lawyers and the entire Colorado and American Bar Associations, among others. She has filed the lawsuits in Colorado U.S. District Court, and also in federal courts in Illinois, Minnesota, Kansas and the District of Columbia.. …The judge said he will issue an additional order prohibiting Kay Sieverding from filing any more lawsuits, anywhere in the United States, without an attorney or his permission.” (Karen Abbott, “Pledge gets woman out of jail”, Rocky Mountain News, Jan. 5; Alicia Caldwell, “Woman Held Over Lawsuits”, Denver Post, Dec. 19)(via Jonathan B. Wilson, here and here).

Sports-ticket options?

An Internet site has begun offering “sports-ticket options.” I’ll let Brad Humphreys’s “Sports Economist” blog explain: “For example, I could currently purchase the option to a ticket to the Final Four to see my alma mater, West Virginia University, for $27. If the Mountaineers make the final four, I would pay the face value of the ticket ($140, according to the web site), plus my $27 option.” Over the course of the season, the market for the option fluctuates, and one can sell or buy it. Here’s the catch: “If the Mountaineers didn’t make the Final Four, my option would be worthless and I would be out $27.” Tom Kirkendall and Tyler Cowen, an exceptionally intelligent lawyer and economist respectively, also comment, as does Wired Magazine.

And, yet, somehow, all three bloggers miss a large point of the exercise: to try to get around the anti-gambling laws. Despite the site’s claim to be merely a market-clearing place, there’s no option available for one to actually offer to sell one’s tickets. So where are the tickets coming from? (In case of the Rose Bowl, from the event itself.) Or going to?: the Wired story never interviews anyone who actually ends up with a ticket. Not to suggest that the site is actually ripping people off—with a 17% commission on every transaction and with the vast majority of options expiring worthless, the site makes more per ticket than any scalper does. A recent Forbes story covers a smaller competitor.

For you securities-law geeks out there, here’s the SEC’s no-action letter. I leave to others whether the site is accurately describing its activities. And, of course, the fact that one agency promises no action with respect to the securities laws is no guarantee that the aggressive Department of Justice will take no action with the gambling laws.

“FTC objects to Netflix settlement”

“The Federal Trade Commission is asking a California judge to reject a proposed class-action settlement between consumers and the Internet DVD rental service Netflix, saying the agreement ‘appears dangerously close to being a promotional gimmick.’ … In the proposed settlement, plaintiffs’ lawyers would receive $2.5 million, but the plaintiffs — in this case, the class of current and former Netflix customers — would receive either a free service upgrade for one month or a coupon for free service for one month. However, if customers receiving the freebies do not cancel the upgrades or service before the end of the month is up, Netflix would begin charging them for the extra services.” (Candace Heckman, Seattle Post-Intelligencer, Jan. 10). Ted thoroughly examined the defects of the settlement Nov. 3. The commission’s amicus brief is here in PDF format (courtesy Skip Oliva, who comments). Update Jan. 21: settlement delayed because of large number of objections.

U.K.: “over-promoted” bodyguard wins $50K

While on the subject of Britain: “A black police bodyguard who protected the Duchess of Cornwall has won [A]$70,000 compensation [roughly U.S. $53,000] after suing Scotland Yard for ‘over-promoting’ him because of political correctness.” Sgt. Leslie Turner’s “representatives argued he landed the prestigious job as Camilla’s bodyguard only because he was black. It was claimed that as a result of being over-promoted and not receiving proper training and support, Sgt Turner made mistakes which led to him being re-assigned….Had Sgt Turner’s case reached a tribunal, potentially embarrassing secrets about Charles and Camilla’s lives may have been aired.” (“Camilla’s protector paid out”, Daily Mail/Melbourne Herald Sun, Jan. 8)(via Taranto). Writes Gary Collard at SarcastiPundit (Jan. 10), “The amazing thing is that it wasn’t a US trial lawyer who first thought of this.”

Most dubious public-liability claims

A list from Britain includes “a bin man who made a claim against his council after being ‘startled’ by a dead badger which fell out of a bag, a shoplifter who sued because she fell down stairs while running from the scene of a crime, and a motorist who claimed he did not see a traffic roundabout in daylight – despite there being a large tree in the middle.” (Patrick Barkham, “The wronged trousers, and other scams”, The Guardian, Jan. 3; “Dubious insurance claims ‘rising'”, BBC, Jan. 2).