Overlawyered: Chronicling The High Cost Of Our Legal System

Posts Tagged ‘forum shopping’

April 4 roundup

All Point of Law edition:

  • I discuss Professor Charles Silver’s latest foray on Bizarro-Overlawyered. Silver and his coauthors are doing legitimate empirical work, but I don’t understand why he keeps making public statements that the published versions of his papers can’t support, and I especially don’t understand why he does that at the same time he’s criticizing the entire reform movement for any given politician’s oversimplified sound-bite. [Point of Law]

  • New Jersey Supreme Court limits benefits of forum shopping, with potentially fatal implications for pending $27 billion class action against Merck. [Point of Law; Beck/Herrmann]

  • The PRI study’s $865B figure isn’t perfect, as I earlier noted in a post since interpreted to mean that I “loved it.” [Point of Law; Turkewitz]

  • Plaintiffs’ bar attempts to smear next Wisconsin Supreme Court justice Annette Ziegler fail. [WSAW; Point of Law]

  • Tax breaks for the plaintiffs’ bar. [Day on Torts; Point of Law]

  • Don’t tell David Behar about this paper; it mentions “privity.” [Point of Law]

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Florida Supreme Court: Forum Shoppers Need Not Fly South for the Winter

Insurance Journal reports that the Florida Supreme Court has rejected an attempt by seasonal residents to apply more favorable Florida rules to their claims under non-Florida auto insurance policies:

‘Snowbirds” and other part-time Florida residents who insure their cars back home cannot make claims under Florida laws that may be more favorable to them than those in their own states, the state Supreme Court has ruled.

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‘Although Florida welcomes its many visitors, whether for short or extended stays, we cannot rewrite their out-of-state contracts,’ Justice Raoul Cantero wrote for the high court.

Interested readers can view the full Opinion [PDF] in State Farm Mutual Ins. Co. v. Roach, Case No. SC04-1313 (Dec. 14, 2006).

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Yet another Borat suit

This one threatened on behalf of villagers from Glod, Romania, (a stand-in for Kazakhstan in the movie) who say they weren’t paid or given releases for their participation in the film, an assertion denied by the studio. The Los Angeles Times gives a largely sympathetic platform to their lawyer, Ed Fagan, without managing to mention the disciplinary trouble he found himself in (Nov. 26; Aug. 27, 2005 and links therein). Fagan shamelessly admits that he will simultaneously file suits in California, Florida, and Germany; international judge-shopping at its finest. (Bojan Pancevski, “Villagers to sue `Borat'”, Los Angeles Times, Nov. 19).

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Very big breaking news: UK libel laws narrowed

One of the few places where the UK is more litigious than the United States is in its infamously broad libel laws, which put the burden of the proof on the defendant to prove the truth of a statement, resulting in multiple instances of “libel tourism,” which we’ve noted previously: e.g., Aug. 1, Jan. 6, 2004, and, most notably, by Saudi businessmen hoping to preclude investigations into their relationship with terrorists, Oct. 26, 2003. (In contrast, in the United States, the Supreme Court has ruled that, to avoid “chilling effects” on First Amendment speech rights, a public-figure plaintiff must prove an intentional or reckless falsehood.) Britain’s top court sided with the Wall Street Journal Europe and created a legal defense whereby a speaker who “behave[s] fairly and responsibly” in reporting on a matter of public importance will not be liable for defamatory statements. (Aaron O. Patrick, “U.K. Court Backs WSJE in Libel Ruling”, Wall Street Journal, Oct. 11; Lattman). This moves the UK much closer to the US in its libel law.

I am not the first to note that, while academics and courts of all stripes recognize the potential chilling effects of litigation on First Amendment rights, courts have been reluctant to acknowledge the chilling effects of litigation on other rights and economically productive activity.

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Heads I win, tails don’t count files: Ohio HMO suit

The US Supreme Court denied certiorari on United HealthCare’s attempt to enforce an arbitration agreement in its contracts with doctors who filed an Ohio class action over reimbursements. The underlying class action is essentially identical to one that a federal court threw out as meritless in July, though this isn’t mentioned in the television coverage, much less that from Bizarro-Overlawyered. The Class Action Fairness Act effectively ends this sort of Russian-roulette game where plaintiffs get multiple chances to win a gigantic class action by filing in multiple jurisdictions, but does not apply to class actions (like this one) filed before 2004.

The AMA has supported these lawsuits, which is disappointing, to be sure; as I noted on Point of Law in July, “Next time the AMA complains about the costs of excessive meritless litigation, they can perhaps look in the mirror.”

The plaintiffs’ attorney is Overlawyered favorite Stanley Chesley: see Jul. 4, Mar. 6, Aug. 24, 2005, et cetera.

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London’s (and Belfast’s) libel-shoppers

Britney Spears has resorted to the courts of justice in Belfast, Northern Ireland, to slap down the National Enquirer, while singers Paula Abdul and Whitney Houston are reported to be contemplating similar trips in search of the plaintiff-friendly libel laws of the United Kingdom. Aren’t they just a little bit ashamed of themselves? The “speedy results and whopping damages” of defamation suits in the U.K. “might be nice for the celebrity claimants. But it’s bad for those of us who live in Britain permanently. These libel tourists are helping to prop up our illiberal, antidemocratic, and ‘repugnant’ libel laws, which are an offense to free speech and open debate.” (Brendan O’Neill, “Throwing our judicial junk in Britain’s backyard (or courts)”, Christian Science Monitor, Jul. 24). But actually, reports Mark Stephens in The Times (London) Online, it is global business magnates rather than entertainment figures who are nowadays the busiest libel tourists in the British courts. They come from America, Russia and the Middle East to squelch the naughty insinuations of the financial press that not everything about their business dealings is on the up and up (“New celebrities of the libel courts”, Jul. 18).

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Update: Trump decamps to Camden

Caesar’s forum-shopping dept.: Donald Trump has filed his $5 billion defamation suit against author and New York Times reporter Timothy O’Brien (see Jan. 25, Feb. 12) not in the courts of some boringly obvious place like, say, Manhattan, but in Camden, New Jersey, which happens to be “where his golf buddy, George Norcross II, the state’s behind-the-scenes political kingmaker, holds court. In 2001, Norcross, an exec at Commerce Bank, was caught on tape boasting of having engineered a judgeship for a political foe ‘just to get rid of him.’ Norcross’s claim to control the New Jersey courts was only bluster, his longtime lawyer, William Tambussi, said at the time. Tambussi has also been retained by Trump in his suit.” (Geoffrey Gray, “Intelligencer: Trump’s Jersey Trump Card”, New York, Mar. 13).

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Winn-Dixie, up North

According to UCLA lawprof Lynn LoPucki, about 60 percent of recent big corporate bankruptcies have been filed in courts away from the companies’ hometowns. Although not all motives for selecting a distant bankruptcy venue are improper, forum-shopping can assist incumbent managers in finding a court that will cede them broad control during a reorganization (including the payment of large “retention” bonuses), while lawyers and other professionals may seek to steer filings into courts that are indulgent about approving fee requests. Among the losers: many creditors, which in some cases may include the companies’ workers. An opponent dismisses the charges as “baseless and offensive”, but some judges agree that the indictment holds merit. The Southern supermarket chain Winn-Dixie filed in New York City, then after a furor agreed to move the proceedings to its home state of Florida. (Pamela A. MacLean, “Forum Shopping Alleged in Chapter 11 Cases”, National Law Journal, May 3). See, among other posts, Mar. 8, 2004. More: Larry Ribstein (Jun. 22) has some thoughts on the market for jurisdiction-shopping.

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Update: Mississippi “60 Minutes” suit

More than two years ago (see Dec. 16-17, 2002), following a CBS “60 Minutes” installment exposing “jackpot justice” in Jefferson County, Mississippi, two former jurors struck back with an intimidating lawsuit against the network and two local interviewees. Now Ted reports at Point of Law (Mar. 4) that the Fifth Circuit has affirmed the suit’s dismissal by a federal district court; that court “assumed jurisdiction after it found that state defendants had been fraudulently joined in an attempt to defeat federal jurisdiction”.

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