Following breathless press exposes of the “payday lending” business near military bases (they charge high interest rates! It’s a bad deal if you’ve got access to conventional credit!) a new federal law sharply restricts the interest that can be charged to military borrowers. This report from Utah finds lenders responding by simply refusing to make loans to members of the military. A critic of the industry, Linda Hilton of the Coalition of Religious Communities, says she’s glad the option is disappearing and recommends that if service personnel find themselves in financial straits “then they ask their church, military relief groups, family or others for help”. More great moments in predatory lending law: Oct. 17, 2006 (cross-posted from Point of Law; & welcome Marginal Revolution readers).
Hockey star: seat belt sank into cushions, car dealer should pay
Have you noticed the annoying tendency of seat belts in certain vehicles, such as airport limos, to sink so deep into the cushions that you can crack your fingernails trying to pull them out? Now a lawsuit against a Ford dealership seeks to blame that phenomenon for the 1997 injuries that ended the career of Detroit Red Wings hockey star Vladimir Konstantinov and team masseur Sergei Mnatsakanov. The two were seriously injured when their driver, who was driving on a suspended license following a long series of roadway infractions, veered off Woodward Avenue into a tree. Neither of the injured men was wearing a seat belt, which they blame on the “design defect” that prevented the belts from being “easily accessible”. The car dealership, Findlay Ford Lincoln Mercury, “argues it did not manufacture the limo or carry out modifications that were made to it and the dealership had no reason to know about or be liable for any alleged defects.” (Paul Egan, “Court to hear arguments in Konstantinov crash suit”, Detroit News, Aug. 22). Also see Nov. 25 (other litigation arising from crash).
“The always indispensable Overlawyered”
Thanks to Michelle Malkin at her #1 conservative blog for those kind words.
Blind shoppers can sue Target over its website
In a major victory for disabled-rights activists, federal judge Marilyn Hall Patel has ruled that the National Federation of the Blind can go to trial against the Target Corp. on charges that its online shopping website should be redesigned to make it easier for blind computer users to use. (Bloomberg, Reuters).
We’ve covered the Target suit Feb. 8 (with enormous reader discussion), Oct. 4 and Oct. 27 of last year. Existing federal court precedent, in the Southwest Airlines case, discourages the most far-reaching demands for web “accessibility”; the Target case, which is being heard before a judge who’s considered relatively liberal, is important because disabled-rights activists hope to use it to counter and eventually reverse the Southwest precedent (see Jan. 8, 2004). For reasons why a victory by the activists might lead to unprecedented infringements on the freedom to conduct business or even publish online, see my May 2000 Reason column and my House testimony of earlier that year, and earlier posts on this site (& welcome Michelle Malkin readers).
October 3 roundup
- Yet another Apple suit, this time on behalf of user who wishes iPod and iTunes were more compatible with other song vendors and devices [Miami Herald/ILR]
- Fairview Heights, Ill. alderman says town was “deceived” into serving as lead plaintiff in class action against Orbitz, Priceline, Expedia and other online travel firms [Madison County Record]; More: here and here.
- “Evasive”, “bad faith”: federal judge slams health insurance lawyers for stalling suit by docs [Phila. Inquirer; Plus: their side @ Law.com]
- Plastic water guns draw ire of politicos in Albany, N.Y. [Times-Union via Nobody’s Business]
- High lawyers’ fees said to be pricing middle class Canadians out of the justice system, but it must be said the numbers cited sound pretty low by U.S. standards [Maclean’s]
- Flickr makes it easy to grab and reuse strangers’ photos, and legal sorrows ensue [NY Times]
- Jack Thompson tries to get federal judge Jordan removed from hearing one of his lawsuits against the Florida Bar [GamePolitics.com; & yet more]
- New at Point of Law: trial lawyers deem “slanderous” ads featuring fictional law firm of Sooem, Settle & Kashin; Business Week cover story on wage/hour suits; John Edwards comes out again for “certificate of merit” med-mal reform; replace your old kitchen cabinets and get lead paint companies to pay; and much more;
- Some New York lawmakers think secondhand smoke is just as bad for you as actually being a smoker [Siegel via Sullum; more on recent smoking bans, complete with culturally-sensitive hookah exception]
- “Disability Math” video explores paradox of how employment fell among handicapped after enactment of the ADA [Dubner, Freakonomics; more (now with more direct Freakonomics link)]
- Class-action lawyers sue over kids’ Pokémon card trading craze, claiming it’s illegal gambling [Eight years ago on Overlawyered; Milberg Weiss angle here]
Jackpot justice: Anucha Browne Sanders
Granted: sexual harassment is wrong, and we at Overlawyered do not approve of it. I have no reason to side with one party or the other in the he-said/she-said dispute in the lawsuit against Isiah Thomas, James Dolan, and the owners of the New York Knicks, MSG, though one questions the relevance of Stephon Marbury’s sexual exploits with a third party and whether that salacious testimony perhaps prejudiced the jury. But even if one agrees that everything Anucha Browne Sanders alleged occurred? Well, that $11.6 million award—which does not even include a penny of economic damages—is outrageous. Hey, I’ll let Isiah Thomas call me a bitch for a hundredth that amount. Given the Supreme Court’s command that punitive damages have some reasonable relationship to compensatory damages, it is hard to understand why a jury was allowed to make an eight-digit award when there has yet to be any compensatory damages established.
ADA lawsuit closes kids’ basketball camp
In Rancho Cordova, Calif., a 50,000-square-foot kids’ indoor sports complex has closed operations following a lawsuit over its lack of wheelchair access. A financial angel, however, has offered to donate a $35,000 lift for free, and Basketball Town’s executive director is cautiously optimistic, saying there is a 50/50 hope that it might reopen. “The original lawsuit was filed by a Solano County man who is a quadriplegic. He says he was unable to attend his nephew’s birthday party on the mezzanine floor last year. Since then, the building’s owner and the tenants who run Basketball Town have clashed over who should pay for the retrofitting.” Derrick Ross of Suisun City has “filed similar lawsuits against two Northern California businesses in the last two years over Americans with Disabilities Act compliance issues.” (Stan Oklobdzija, “Sports complex to close”, Sacramento Bee, Sept. 30; Dave Marquis, “Basketball Town’s Future in the Air”, Oct. 1; Chuck Shepherd’s News of the Weird Daily).
GOP presidential candidates, cont’d
On yesterday’s radio program, host Hugh Hewitt asked me about the various GOP contenders’ stands on liability reform. I replied that for the most part they were clumped pretty closely together in strongly backing federal-level reform measures, the exception being Sen. Fred Thompson who has voted against several Congressional proposals to limit liability and has been backed fairly strongly by plaintiff’s lawyers in his campaigns. I added that Thompson has defended his votes on federalist principle and that his arguments on this point deserve a fair hearing; there are often plausible (and even compelling) federalist reasons to refrain from nationalizing areas of liability where the ultimate cost of state-court errors falls within states’ own borders rather than being dumped on residents of other states.
Those interesting in pursuing these questions can find more on Thompson’s views here, here, and here; on Giuliani’s here and here (and ritual disclaimer); on Romney’s here and here; and on Rep. Ron Paul’s, here (opposes Congressional involvement in malpractice reform on federalist grounds).
A Thousand Little Refunds, Plus Attorneys Fees
For $800,000, one could buy a nice house, two thousand iPhones, about five days’ worth of Alex Rodriguez’s contract, or 1,700 hours of class action lawyers producing absolutely nothing of any value to anybody.
In January 2006, The Smoking Gun reported that James Frey’s A Million Little Pieces memoir had significant inaccuracies. After a few days of denial, Frey admitted that the book was inaccurate. The publisher, Random House, immediately posted a statement to that effect on its website and offered a refund to anybody who was upset. Approximately 12 seconds later, hordes of trial lawyers copied down the allegations from The Smoking Gun’s website and rushed to the courthouse to file “consumer fraud” class action lawsuits against Frey and Random House. They demanded… that Random House post a disclaimer and give refunds to anybody who was upset. In a sane world, those lawyers would have been sanctioned for filing a frivolous lawsuit, and then sanctioned again for wasting everyone’s time by asking for a remedy that had already been achieved.
But as we know, this world is Overlawyered, so, more than 1,700 hours of trial lawyer time later, Random House agreed to settle the case for “up to” $2.35 million, to cover refunds, costs, and attorneys fees for the up-to-3.5 million people who purchased the book before Frey admitted it was inaccurate.
And now the other shoe has dropped, exactly as Walter predicted in May. The deadline for class members to submit their claims was October 1st, and according to filings by the class lawyers, a grand total of 1,345 people had done so by September 17th; based on past experience, they expected another 250 submissions in the last two weeks before the deadline. Yes, that total would be less than one-half of one percent of those who bought the book — the alleged “victims” of the alleged “consumer fraud.”
But despite this dismal response rate, the class action lawyers have now submitted their fee request… $783,333.33 — or one third of the imaginary $2.35 million settlement. Plus $14,000 in expenses. The lawyers defend this fee as reasonable on the grounds that they spent those 1,700 hours preparing their case. (h/t The Smoking Gun) $800,000, and 1,700 hours — for a case where the research was all done by the Smoking Gun before the suit was filed, and the only thing the lawyers had to do was create enough of a nuisance to induce Random House to settle.
For those of you scoring at home, assuming a $15 refund for each claimant, that would be a total recovery of approximately $24,000 for the class members. And $800,000 for the lawyers. Or, in other words, about 3% of the recovery for the consumers, and 97% for the lawyers. Ain’t America grand?
Contingent-fee tax collection in Mississippi, cont’d
Mississippi state auditor Phil Bryant “has issued a demand letter for recovery of the $14 million in legal fees paid by MCI to two law firms in the wake of the state’s $110 million settlement with MCI in a 2005 tax fraud case.” The Langston and Lundy & Davis law firms “were hired as outside counsel to represent the state by current Attorney General [Jim] Hood. Langston has been identified as one of Hood’s largest campaign contributors, a reality that Langston doesn’t deny.” The two firms were then cut into the $14 million as part of the negotiated settlement, but Bryant says the money belonged to the public and should have gone through the appropriations process. The twist: to enforce the state’s rights in the matter, Bryant will apparently have to call on legal support from the office of AG Hood himself, and you have to wonder how cooperative he’ll be. (Sid Salter, “Langston: State asks recovery of legal fees”, Jackson Clarion-Ledger, Sept. 23; “State parties bring smack down”, Biloxi Sun-Herald, Sept. 23). More on the furor: Point of Law, May 13 and May 23, 2005.