Overlawyered: Chronicling The High Cost Of Our Legal System

“5 minute after” suits and the Wal-Mart trampling

Ron Miller at Maryland Personal Injury thinks the filing of suits only days after an event like the Long Island Wal-Mart trampling, at a point when key facts relevant to the nature and extent of liability have yet to be brought out, “don’t help the clients and also don’t help the general public perception of personal injury lawyers or their clients.” There are, of course, numerous tactical reasons for a race to the courthouse in various legal situations, particularly in likely class actions where lawyers who file early may seize control of the management of a collective suit. Where class action handling of cases is unlikely, however, as in the trampling case, I’ve long suspected that the main reason for the race to the courthouse is that it enables the lawyer to get his own name in the papers, thus pulling in other claimants, including some who might otherwise have signed up with less noisy lawyers.

Bill Childs at TortsProf speculates that another reason is to obtain discovery immediately before memories fade or evidence becomes unavailable in some other way. Again, I’m sure there are some cases where this factor is at work, but I also suspect there are many where the lawyer does not follow up on the hasty filing by plunging into discovery as rapidly as is practicable.

P.S. Some new reporting out on the events leading up to the shopper crush that morning, and a blog roundup from Carolyn Elefant. At “Freakonomics”, Ian Ayres: “To say that the low prices were a but-for cause of this man’s death is not to say that Wal-Mart should be legally or morally culpable for low prices.” Further thoughts from White Coat Rants. And from commenter “Dan”, below, a naughty suggestion for how to treat the claims from not-especially-injured crowd members:

…how about this idea. Everyone who self-identifies as being in the trampling crowd so they can share a jackpot for the psychological horror of it also gets put on the list of people included in a share of a manslaughter charge. Seems like a good trade; a coupon for $10 off your next Wal-Mart purchase in exchange for a few years in prison. Any takers?

P.P.S.: Eric Turkewitz advances an alternative motivation for haste, in that it might encourage potential witnesses to get in touch with the lawyer; yet another possibility, he says, is that the plaintiff family might have demanded haste.

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Microblog 2008-12-04

  • MDs retreating from hospital-based practice for many reasons, including legal [Happy Hospitalist]
  • Mark Twain: “It usually takes me more than three weeks to prepare a good impromptu speech.” Know that feeling [h/t @lawfirmblogger]
  • Among Murdoch properties, stolid WSJ has begun sharing stories with tabloid NYPost, think of the satiric possibilities [Calderone/Politico]
  • Oral history of libertarian magazine Reason over 40 years, lots I didn’t know about its past [Brian Doherty and many others]
  • As rescuers neared, “immaculate” champagne service: sang-froid of staff and guests under Taj siege [Daily Mail] Security at Mumbai’s Oberoi hotel couldn’t get gun permits from gov’t [WSJ] Tunku Varadarajan: What India must do now [Forbes]
  • Good! Obama camp hedging support for EFCA (card-check, imposed union contract) bill [Las Vegas Sun h/t @Eric_B_Meyer]
  • Lap dancing “is not sexually stimulating”, British parliamentary committee is told [Guardian via Feral Child]

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No decent interval for Eliot Spitzer

Yes, he’s going to be back, as a columnist for Slate instructing the world on matters of government, regulation and finance. Perhaps one of his early columns will be on the topic “Why it’s a bad idea to lead a public crusade to toughen penalties for a particular legal offense if you yourself are an ardent repeat committer of it.” Prof. Bainbridge has some further thoughts, along with a collection of Jay Leno jokes.

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From comments: lawyer referral fees

Reader Phil Grossman, in comments to yesterday’s post about the hawking of injury case leads to lawyers, advances some interesting contentions, including some I’m not knowledgeable enough to evaluate, about lawyer referrals and fee-splitting:

…Lawyers are the only professional group that considers it ethical to pay referral fees. The bar associations allow and approve referral fees as long as they are paid only to other lawyers.

In the sort of mass tort lawsuits that this company is dealing in, it is extremely common for ‘clients’ to be bought and sold, sometimes multiple times, with a typical referral fee being around a third of the contingency fee. The general public doesn’t realize that the lawyer advertising on TV or out on the Internet for mass tort clients is usually just a marketer, selling all the clients he collects to other lawyers. It is actually more lucrative to advertise for clients and then sell them to other lawyers than to do the actual work of representing clients.

If, for example, someone is injured in an auto accident, it is common for a relative or friend who happens to be a lawyer to offer to refer the victim to a “good personal injury lawyer”. But the victims aren’t aware that their relative or friend is probably making money off of their accident by collecting around a third or so of the contingency fee from the lawyer they have been referred to. Although bar association rules usually say the referral fee and its amount should be disclosed to the client, in practice it is always kept secret from the client, who thinks his or her lawyer relative or friend is just being altruistic.

But it appears that this company might be trying to collect money up front from its targeted lawyers, rather than taking the normal percentage payment of their referral fees from the contingency fees after the fact. If so, the targeted lawyers need to be very cautious indeed.

And:
Read On…

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When you hear “monster”, they want you to think of them

Back in April we had occasion to note the aggressive intellectual property stance of a company called Monster Cable, which had drawn a memorably tart riposte from the recipient of one of its nastygrams. We didn’t catch a wider aspect of the story, noted by Engadget in May, which is that Monster Cable goes around demanding that a wide range of businesses stop using the word “monster” in contexts far removed from its own line of work (audio/video cables); it reportedly has demanded cash from such businesses in exchange for calling off its lawyers. One of its targets, a miniature golf operation called Monster Mini Golf, is now trying to bring the story to public attention (TechDirt, Dec. 3).

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Claim: You rated our constituents as too creditworthy

“In what appears to be the first legal action of its kind, an association of community-based organizations has filed a federal civil rights complaint against two of the three largest Wall Street ratings agencies, charging that their inflated ratings on subprime mortgage bonds disproportionately caused financial harm to African American and Latino home buyers.” (Kenneth Harney, Washington Post, Nov. 29; Hans Bader, CEI “Open Market”, Nov. 30).

P.S. Mickey Kaus (permalinks gone again, scroll to Dec. 1):

Hmmm. Didn’t community-based organizations push for exactly this sort of reverse-redlining? I think they did. It’s one thing to argue that they maybe weren’t the major cause of the subprime meltdown. It’s another for them to pose as victims wronged by the very system they worked hard to set up (including the securitization that enabled banks to keep up “reverse redlining”).

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New Manhattan Institute study on case for loser-pays

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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Wal-Mart trampling suit

Father and son Fritz Mesadieu and Jonathan Mesadieu say they were in the crowd during the now-notorious Black Friday crowd-crush episode at a Long Island Wal-Mart. They say they were left with neck and back pain for which they want $2 million. (Wisecracks about a stampede to court are in extremely poor taste and should be avoided.) Their attorney, who gets a prominent mention in the CNN coverage, is named as Kenneth Mollins, apparently the very same attorney Kenneth Mollins whose skill in transforming seemingly minor or transient injuries into litigation Ted saluted in June (h/t commenter Don Parks). (“Customers injured in crush suing Wal-Mart”, CNN, Dec. 2). More: Eric Turkewitz has some thoughts on the underlying liability issues, the Mesadieu/Mollins claim aside.

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