What’s new on Point of Law?

Are you reading Point of Law regularly? If not, you’re missing

extensive analysis of the Alito nomination;
the meaning of the New Jersey Vioxx verdict;
the plaintiffs’ lawyer who asked for $60 million because he had successfully forum-shopped for a court with judges he helped elect;
Eliot Spitzer bullying competitors of the Postal Service;
multiple refutations of the plaintiffs’ bar’s attempt to lie about medical malpractice insurance;
ongoing coverage of the silicosis litigation scandal;
an extensive discussion of what it means to be an ethical litigator; and much, much more.

Filed under: about the site, Eliot Spitzer, New Jersey, silicosis

“Grandpa is sued over grandson’s downloads”

“A 67-year-old man who says he doesn’t even like watching movies has been sued by the film industry for copyright infringement after a grandson of his downloaded four movies on their home computer.” The Motion Picture Association of America earlier demanded $4,000 from Fred Lawrence of Racine, Wisc. and is now suing him for as much as $600,000 in damages. Lawrence says the grandson, who was 12 at the time, downloaded the files out of curiosity and deleted them immediately; the family already owned three of the four films on DVD. (AP/Business Week, Nov. 2).

Filed under: copyright, technology

“Gripe site” protected as opinion

Continuing a trend toward the protection of “gripe sites” as free speech, a Manhattan judge has ruled that a New Jersey man’s website assailing an auto warranty company did not constitute actionable defamation. Penn Warranty Corp. sued Ronald DiGiovanni over eight allegedly libelous statements posted on his site, including assertions that it is a “blatantly dishonest company” that has been “running scams,” “committing fraud on a grand scale,” and “ripping off its contract holders for quite a while.” The judge granted DiGiovanni’s request for a summary judgment dismissing the action, however, ruling that “the web site, when viewed in its full context, reveals that defendant is a disgruntled consumer and that his statements reflect his personal opinion based upon his personal dealings with plaintiff. They are subjective expressions of consumer dissatisfaction [and] are not actionable because they are defendant’s personal opinion.” (Mark Fass, “Court Finds ‘Gripe Site’ Is Protected Free Speech, Not Defamation”, New York Law Journal, Nov. 1).

Filed under: libel slander and defamation, New Jersey, online speech

Squabbling Oz opera companies

They’ve been fighting over a A$1.8 million bequest left by the late Edith Melva Thompson, with the result that at least a third of the sum is expected to be consumed in legal fees. (Katrina Strickland, “Lawyers the winners in bequest to opera”, The Australian, Oct. 27).

Filed under: Australia, family law, Katrina

Merck wins N.J. Vioxx case

Point of Law contributors have been following the case, and KevinMD rounds up blogger reactions.

Sekulow’s fundraising

Bob Felton of Civil Commotion got a fund-raising appeal from the ACLJ in his email last April, and was not impressed by its contents. He hasn’t been troubled with any follow-up appeals, though. See yesterday’s post.

Filed under: ethics

18,299

That’s how many visitors our servers recorded yesterday, thanks in part to Andrew Sullivan and others who linked to our Jay Sekulow item. Not sure that’s the highest number ever for one day, but it’s certainly among the better showings.

Filed under: about the site

Frank Chavez v. Netflix Class Action settlement

Netflix has settled a purported class action in California state court complaining about alleged false advertising over “unlimited” DVD rentals. One is reminded of Lionel Hutz:

“Mr. Simpson, this is the most blatant case of false advertising since my lawsuit against the movie The Neverending Story!”

Class members get a free one-month upgrade in service level (e.g., those who have a subscription entitling them to eight DVDs rented at a time may now rent nine DVDs at a time)—but will be billed for the upgrade for future months unless they remember to ask for a downgrade before the free month expires. The plaintiffs’ attorneys will ask for $2.5 million, money well spent by Netflix since a court-ordered settlement will permit them to engage in upselling marketing tactics that might not be permissible otherwise. Precisely how the class is better off remains (at a minimum) questionable. (Chavez v. Netflix, Inc. (San Francisco Superior Court No. CGC-04-434884)) (hat-tip to D.F.). More from Baude, 3YOH, and Hit & Run.

The settlement remains subject to the court’s approval, and two class members have had discussions with me about representing them in filing an objection; I’m considering it, as are they. (Threatening to take away $2.5 million from a lawyer might get him angry enough to retaliate with harassing discovery.) Of course, the Class Action Fairness Act will help to act to prevent abuses like this in the future; will the California courts protect class members from their attorneys’ neglect of fiduciary responsibilities in the present?

Update, Thursday morning: This site has links to printable opt-out forms. Note that a 5% opt-out rate doesn’t necessarily keep the settlement from being approved (and the lawyers from being paid); it just gives Netflix the option of backing out of the settlement if they think there will be further litigation from the opt-outs. If Netflix attorneys believe that, even with a high opt-out percentage, there is unlikely to be further litigation and it will be cheaper to go forward with this settlement than continuing to litigate against Frank Chavez, they will proceed with the settlement. The 5% clause is there to protect Netflix from having to deal with a second class action. Opting out may just cost you 37 cents, and lead to a new class action settlement that you probably won’t like much better.

The Netflix Fan site (via Boing Boing (hat-tip A.T.)) notes that Netflix is budgeting for $3.0 to $4.0 million in settlement expenses—which implies $2.5 million for the plaintiffs’ lawyers, a few hundred thousand in legal and administrative expenses for Netflix, and negligible benefit to class members.

Class members as a whole are clearly worse off from this settlement: if they’re happy with the company, it’s financially injured by having to pay protection money to plaintiffs’ lawyers; if they’re unhappy with the company’s service, their recovery is illusory—even if the company had done something illegal, which it doesn’t appear that it has. Worse, consumers as a whole are worse off, because the ability of the plaintiffs’ lawyers to recover millions from a meritless lawsuit will encourage them to file other meritless lawsuits, diverting money from useful endeavours to lawyers’ pockets, and raising costs for everybody.

Note that one can only object to the settlement (or join in a filed objection) if one does not opt out of the settlement. Opt-outs are no longer members in the class, and will not have “standing” to object.

Here’s the settlement website. Geektronica post and comment thread. Bond comments.

And a trenchant observation from the Metafilter comments page:

I do wonder why the plaintiffs’ attorneys agreed to it.

‘Cuz they got paid $2.5 million.

(This post is expanded and bumped from Nov. 2, 10:32 am, when it was titled “Lawyers Imitate Lionel Hutz Department.” Post title changed to be friendlier to Google searches.) Update Jan. 11, 2006 (FTC objects); Jan. 21 (settlement delayed because of large number of objections).

Filed under: class action settlements, class actions

Satire in The Onion

The humor publication, taking note of lawmakers’ recent passage of industry-by-industry liability limits protecting gun manufacturers and makers of fattening food, suggest a bunch more “New Corporate Responsibility Laws”. Among them: “Camera manufacturers no longer held accountable for embarrassing intimate photos posted on Internet” and “Slushee Corporation cannot be blamed for lowered sexual desire when product is accidentally spilled on lap”.

Mysterious Wal-Mart suit

One can understand why Wal-Mart is upset that a former executive, Tom Coughlin, allegedly swiped a half-million dollars, and wants to stop paying him in addition to referring the matter to federal prosecutors. But one doesn’t understand why Wal-Mart, in an effort to recover a fairly small sum, is arguing to the court that it should disregard the mutual waiver and release that Coughlin signed with Wal-Mart when he left the job. Surely the corporation would be better off on the whole with a legal rule that strictly enforces releases than one that judges the validity of a release on a case-by-case basis. (AP, Nov. 2).

Read On…

Filed under: workplace