Overlawyered: Chronicling The High Cost Of Our Legal System

Will Florida takings injustice tempt SCOTUS?

Simone and Lyder Johnson say they

were drawn to Ponce Inlet, Florida, where they bought land and made plans to construct their dream home. Sensing that the town may be able to benefit, Ponce Inlet persuaded the Johnsons to expand their plans into “a delightful mixed-use waterfront development.”

Over several years, the Johnsons bought additional parcels while working hand-in-hand with the town. They were amenable to providing everything the town asked for, like a nature preserve and boat slip. After millions of dollars were spent, the town changed its mind, halted all work, denied permits, and went so far as to pass legislation prohibiting all development on the Johnsons’ property.

Under current regulatory takings law, government is hardly ever required to pay compensation when it forbids the use of land. Is the injustice in this case extreme enough to tempt SCOTUS to revisit the issue? [Ilya Shapiro, Trevor Burrus, and Meggan DeWitt on Cato certiorari brief in Pacetta v. Ponce Inlet]

And a reminder to mark your calendar: Cato’s 17th annual Constitution Day is coming up Monday, September 17. Details and registration here.

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Liability roundup

  • A win for class action objector Ted Frank as Seventh Circuit allows him to challenge what he described as “objector blackmail” payments to other intervenors [Amanda Bronstad, National Law Journal, Pearson v. NBTY]
  • City of Seattle pays $13 million to settle suit alleging negligent probation supervision of drunk driver [Jessica Lee, Seattle Times, Brian Flores, KCPQ, my 2005 take on Washington’s unique rules on sovereign immunity and more]
  • “Family sues Dum Dum lollipop maker over son’s alleged choking incident” [Alexandria Hein, Fox News]
  • Thanks to New York’s Scaffold Law, co-op and condo boards “can be held liable for millions of dollars in damages – even if the injured worker was drunk or failed to use safety equipment.” [Habitat mag] “Coverage for East Side Access [infrastructure project] has surpassed half a billion dollars” [Will Bredderman, Crain’s New York]
  • As Brett Kavanaugh’s SeaWorld dissent shows, he’s a judge who takes assumption of risk seriously [ABA Journal, SeaWorld v. Perez]
  • Twiqbal pleading standards continue to do good, this time in New York state courts [Drug & Device Law]

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ACLU: don’t let New York regulators squelch NRA’s First Amendment rights

I’ve been critical of the ACLU lately but its amicus-brief defense of the NRA’s First Amendment rights against New York Gov. Andrew Cuomo’s strong-arm use of insurance and bank regulation is vital, timely, and right:

Public officials are, of course, free to criticize groups with which they disagree. But they cannot use their regulatory authority to penalize advocacy groups by threatening companies that do business with those groups. And here the state has admitted, in its own words, that it focused on the NRA and other groups not because of any illegal conduct, but because they engage in “gun promotion” — in other words, because they advocate a lawful activity.

Substitute Planned Parenthood or the Communist Party for the NRA, and the point is clear. If Cuomo can do this to the NRA, then conservative governors could have their financial regulators threaten banks and financial institutions that do business with any other group whose political views the governor opposes. The First Amendment bars state officials from using their regulatory power to penalize groups merely because they promote disapproved ideas.

My post from May on the topic is here. More on the ACLU brief: Dan M. Clark, New York Law Journal; Declan McCullagh.

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“Needless to say, the film-makers employed no such editing maneuvers during the interviews of the plaintiff litigation team.”

Defense lawyer Stephen McConnell reviews the shame-on-business documentary The Bleeding Edge. There were few surprises: “We had been fully warned that the film was a thoroughly one-sided screed against the medical device industry….We also hear from ubiquitous plaintiff expert David Kessler, a former head of the FDA.” And see: our coverage back when of other one-sided documentaries including “The Hunting Ground” (college sexual assault), “Super Size Me,” the one on the (fraud-riddled) banana pesticide litigation, and above all the trial-lawyer-backed “Hot Coffee” (much more on which).

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Environment roundup

  • End of the road at last for Steven Donziger, impresario of Chevron/Ecuador litigation? [Joe Nocera, Bloomberg]
  • Building expensive housing improves housing availability at every income level [Sonja Trauss, Market Urbanism Report]
  • “Ms. Durst did what any law-abiding citizen would do: She demolished the structure and tossed the twigs, moss and shells into the woods…. The fairy house wasn’t up to code.” [Ellen Byron, WSJ, courtesy Regulatory Transparency Project]
  • Last month’s judicial rejection of NYC climate suit came after plenty of foreshadowing [Daniel Fisher (“persuasive authorities” were two overturned court decisions); New York Daily News and New York Post editorials]
  • Ban on smoking in public housing reflects truism that unless you own property, your home isn’t really your castle [Shane Ferro, Above the Law]
  • Obama-era Waters of the U.S. regulations are a power grab asserting EPA control over farmers’ ditches, seasonal moist depressions, and watering holes; one federal court has now reinstated the rules, but the issue is headed to SCOTUS and Congress in any case ought to kill them [Jonathan Adler; Ariel Wittenberg, E&E News; earlier]

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Warren’s corporate governance scheme, cont’d

General incorporation laws were a huge 19th century advance, replacing favoritism-riddled corporate chartering at official pleasure with automatic operation of legal right. Sen. Elizabeth Warren’s corporate governance scheme would risk taking us back to the bad old days. I’ve got a new post at Cato, channeling Richard Epstein and other commentators on the topic. Earlier here, and some extended critique of the “stakeholder” idea in this 2002 piece by Norman Barry.

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HUD’s Carson to localities: stop throttling housing availability

Housing and Urban Development Secretary Ben Carson is pressing local governments to ease barriers to housing construction, which might turn out to be a genuinely progressive stance in a period in which housing costs are soaring in many in-demand cities, led by the West Coast. One reason for HUD to take notice of these local barriers to building is that by artificially driving up rents and construction costs, they drive up the cost of HUD’s own programs: “the most-restrictively zoned states receive nearly twice the federal dollars per capita compared to the least-restrictively zoned states…Determining whether attaching requirements to grants is a constitutionally-sound strategy is best decided by a legal expert. However, Carson’s new focus on educating policy makers on the damaging consequences of local policy, while acknowledging HUD cannot overcome local problems by spending money, is a welcome change.” [Vanessa Brown Calder, Cato]

More/related: Tyler Cowen (on New York Times coverage), Elijah Chiland, Curbed L.A., and Ilya Somin on introduction of bill by Sen. Cory Booker, D-N.J., to discourage exclusionary zoning by attaching strings to the (itself highly dubious) $3.3 billion federal Community Development Block Grant program.

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August 22 roundup

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At Commentary on the Roundup verdict

My new piece at Commentary on a San Francisco jury’s verdict ordering Bayer/Monsanto to pay $289 million to a school groundskeeper who blamed Roundup herbicide for his cancer. It bids to go down in the history books alongside the lawsuits “claiming that silicone breast implants caused auto-immune disease, common childhood vaccines caused autism, the morning sickness drug Bendectin caused birth defects, one or another make of car suddenly accelerated without any input from the driver or gas pedal, and so forth.”

At the end it concludes: “Eventually, our liability system does often get around to rejecting baseless scientific claims of causation, especially since the improvement in the handling of expert evidence embraced by the U.S. Supreme Court in Daubert v. Merrell Dow (1993). Before it gets there, however, it sometimes redistributes large sums—often to claimants, even more reliably to lawyers—and often destroys large amounts of value. In the days after the San Francisco verdict, the value of Bayer stock dropped by more than 10 billion euros. It’s expensive when error prevails.” More: The Logic of Science (“Courts don’t determine scientific facts.”) Earlier on glyphosate here. And a note on the perhaps-surprising tax implications under perhaps surprising provisions of the 2017 tax reform: Robert Wood.

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