Following up on our item of last May 12: the Eighth Circuit federal court of appeals ruled last year that the safety rating group ARGUS (Aviation Research Group) had not defamed Aviation Charter Inc. in 2001 by assigning the charter operator its lowest safety rating, “DNQ” or “Does Not Qualify”. Aviation Charter Inc. operated the plane whose crash a year later, in 2002, killed Sen. Paul Wellstone of Minnesota and seven others. The Eighth Circuit affirmed a lower court’s decision to dismiss the suit, saying ARGUS’s comparative ratings involved subjective interpretations of data and were not “sufficiently factual to be susceptible of being proved true or false”. So for now, at least, it seems that if you want to rate air carriers’ safety, go ahead and rate away. (“Court decisions: Air carrier’s poor safety rating isn’t defamatory”, National Law Journal, Aug. 1, 2005, not online).
Regulation vs. sous vide
We’re here from the government, and since we haven’t yet considered how to regulate your new cooking technique, we’re not going to let you use it (Dana Bowen, “With City Inspectors in Kitchen, Chefs Can’t Cook in a Vacuum”, New York Times, Mar. 9; Virginia Postrel, Mar. 10; Dana Bowen, “Chefs Wait for Rules on Sous Vide, as Experts Question Some Uses”, New York Times, Mar. 15)(& No Quarters).
“Bankruptcy Rewrite Predicted to Bring a Flood of Appeals”
Bad drafting = much uncertainty as to what the law requires. Uncertainty as to what the law requires = grounds for lots of costly litigation. Congratulations, Congress (Justin Scheck, The Recorder/Law.com, Feb. 8).
Federal anti-hacking law
According to Judge Posner, writing for a Seventh Circuit panel, that law can be triggered by an employee’s use of a secure file deletion program to erase data stored on his company-issued laptop. Declan McCullagh is uneasy (“Police blotter: Ex-employee faces suit over file deletion”, CNet, Mar. 10).
After the lawsuit settlement, a spending spree
When big-ticket lawsuits are settled, a trust fund is often established for the future maintenance of the person whose injury occasioned the suit. How secure are these trust funds from being raided and squandered by faithless guardians? In New Jersey, apparently not very secure:
Calling it an “extremely sad case,” a judge on Friday sentenced a Fair Haven woman to seven years in prison for misappropriating much of her disabled daughter’s $2.8 million trust to buy drugs and a Porsche, among other things….[Barbara] Marschall in October admitted misappropriating funds from the $2.8 million special-needs trust established through a settlement of a medical malpractice lawsuit against Monmouth Medical Center, Long Branch. She did so between 1996 and 2004. The funds were intended to be used for services and other care for her daughter, Liza, now 20, to supplement care provided by Medicaid.
According to an assistant Monmouth County prosecutor, Marschall, an admitted heroin and cocaine addict, by 2002 had “spent about $614,000 she had received as an award from the medical malpractice settlement in 1995, then turned to the trust fund for Liza, who was born with neurological problems and cerebral palsy. By December 2004, only about $100,000 of the trust fund remained.”
Since it’s common for large funds of money to be set aside for purposes of covering future medical and personal needs for disabled plaintiffs, at least two questions suggest themselves. First, how frequently are such moneys dissipated (whether through criminal depredation, as here, or simply through less spectacular failings of stewardship) before they were supposed to run out? Second, given that they owe their existence in most cases to legal action, shouldn’t such trust funds be better protected from guardians’ criminality or incompetence? Wasn’t anyone required to ask questions — or call in an auditor, or withhold their co-signature — as this mother drained the trust fund at a rate of more than $100,000 a month over more than two years? (Karen Sudol, “7 years for raiding fund of infirm girl”, Asbury Park Press, Feb. 11; Christine Varno, “F.H. woman sentenced for embezzling”, Red Bank Hub, Feb. 16)(via Rovito).
Antitrust enforcers get wiretap/bug powers
Quietly slipped into the reauthorization of the Patriot Act: first-time-ever authority for the Justice Department to engage in wiretapping and bugging of private premises for purposes of going after antitrust violators. The Patriot Act reauthorization was advertised as an emergency measure needed to combat international terrorism; very little was said about any supposed emergency need to enact miscellaneous prosecutorial wish lists at the expense of civil liberties. (Pamela A. MacLean, “Bugging the boardroom”, National Law Journal, Mar. 1; Skip Oliva, Voluntary Trade Council, Mar. 10 and Mar. 11; Reason “Hit and Run”, Mar. 10; Open Market (new Competitive Enterprise Institute blog), Mar. 10).
Lawyer discipline systems
“Not getting any better,” in the opinion of HALT, the consumer-protection group that looks out for the interests of legal clients. The group has issued a report card rating each of the 50 state lawyer grievance systems, updating a similar effort four years ago. Worst state: Utah. Worst big state: California, ranked #46. Best state: Connecticut. Best big state: Pennsylvania (yes, really). (David Giacalone, Mar. 8).
Latest newsletter
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American Association of Physicians and Surgeons
The Tucson-based group, founded in 1943, bills itself promisingly as “the only national organization consistently supporting the principles of the free market in medical practice”. It’s published material favorable to liability reform in its Journal of American Physicians and Surgeons (formerly Medical Sentinel). Before citing to AAPS publications as one might cite to JAMA or The Lancet, however, it would be wise to read this and learn more about the group’s indulgence for anti-vaccine, anti-fluoridation and anti-gay crankery, as well as what one of its contributors regards as the superiority of “the creation religion of Jehovah” over the “religion of evolutionary humanism”. On the vaccine issue, at least, “the Journal of American Physicians and Surgeons [has been] transformed into one of the primary media allies of litigators and plaintiffs seeking to review medical care after the fact, and find legal fault with physicians, vaccine developers and public health authorities who exercised accepted standards of care prevalent at the time they made their decisions.” (Kathleen Seidel, Mar. 12).
Milwaukee stadium fees: through the roof
The Miller Park stadium district sued Mitsubishi Heavy Industries over alleged defects in construction of the structure’s roof, and Mitsubishi filed a counterclaim. The case was settled a year ago for a $45 million payment between the main parties; now-unsealed court documents indicate that the parties rang up at least $37 million in legal fees. An attorney employed by insurer Travelers Property Casualty Co. of America, which is contesting some of the bills, says millions were spent on consultants and engineers with no detailed descriptions of the work performed. As for the lawyers’ own bills, “Some of the billing entries that have been disclosed are so outrageous they leave no doubt that the bills were never reviewed carefully, even by the firms submitting them,” wrote Katherine Stadler, [another] Travelers attorney. “A charge specifically labeled ‘do not charge client,’ time billed to bring the lawyers lunch, a $5,000 charge for one hour of expert work, and a bill for purchases at a Japanese souvenir shop are only a few examples.”
Several attorneys involved in the case, however, describe the fees and expenses as neither excessive nor disproportionate. “John Hinderaker, a Minneapolis attorney who helped defend the stadium district, said the ‘district bought a completely successful defense of an $87 million claim.” Unless there is another Minneapolis attorney of the same name, that would be the same attorney John Hinderaker who publishes the much visited PowerLine blog. (Don Walker, “Legal fees in Miller Park case go through the roof “, Milwaukee Journal Sentinel, Mar. 4) (via Marquette lawprof Rick Esenberg, who describes the billing in the case as “a tsunami of fees” (Mar. 5) which may however reflect the unfolding logic of expense in big lawsuits rather than anyone’s having been “dishonest or cavalier about the clients’ money”).