Overlawyered: Chronicling The High Cost Of Our Legal System

Posts Tagged ‘Montana’

Gibson Dunn punished for meritless lawsuit

Steve Morton, heir to the salt fortune, asked Steve Seltzer to evaluate the early 20th-century painting “Lassoing a Longhorn”, thought to be a C.M. Russell; Seltzer instead identified it as the work of a less famous artist, his own grandfather, the Russell contemporary O.C. Seltzer. This meant the painting’s value was not about $650-800 thousand, but perhaps a tenth of that. So Morton hired the big law firm Gibson Dunn & Crutcher, and sued Seltzer in federal court for the difference plus punitive damages. Unfortunately, though Morton did have evidence the Russell signature wasn’t altered, he couldn’t find any experts who backed his theory of the painting’s provenance, while Seltzer lined up nine affidavits that supported his conclusion. Morton dropped the lawsuit, and Seltzer then sued Morton, the law firm, and the apparently-now-retired lawyer, Dennis Gladwell. A Montana state court jury found malicious prosecution, and awarded $21 million in damages, based in part on Gibson Dunn’s earnings. The damages award seems improper (it’s punishing the law firm for being large, rather than for wrongdoing); one hopes it is reduced to something in line with the actual damages to Seltzer–legal fees, any economic damages from the brief loss in reputation (though Seltzer doesn’t charge for his authentications), plus perhaps some reasonable non-economic damages for the stress of litigation.

But one would have more sympathy for the defendants if they hadn’t been the first to be using litigation to make unreasonable demands; if all Morton and his attorneys wanted, as they claimed, was to clear the painting’s title, he didn’t need to seek punitive damages against Seltzer. The defendants will appeal. (Kathleen Schultz, “Jury awards artist $21 million”, Great Falls Tribune, Feb. 8; Kathleen A. Schultz, “Seltzer jury may receive case today”, Great Falls Tribune, Feb. 4; Kathleen A. Schultz, “Art collector defends position in malicious prosecution trial”, Great Falls Tribune, Feb. 3; Kathleen A. Schultz, “Seltzer outlines personal suffering in civil suit”, Great Falls Tribune, Feb. 2; David Hewett, “Owners Sue Art Expert, Art Expert Sues Owners”, Maine Antique Digest, Oct. 2003).

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School blamed for class-cutters’ drunken binge

Montana:

The parents of two 11-year-old boys who died of exposure and alcohol poisoning last winter after cutting class to go drink have sued Ronan Public Schools for $4 million.

They allege the school district failed in its duty “to follow its policy and protect and safeguard children that were entrusted to their care.”

The lawsuit also alleges that [the school district] has discriminated against American Indians by “failing to properly select, train and implement Native American staff who are sensitive to the disability of alcoholism,” thus making Pablo School District partially responsible “for the actions of children who were allowed to leave school and die of alcohol and hypothermia.”

(John Stromnes, “Parents sue Ronan school over deaths of their sons”, The Missoulian, Nov. 6). Update Mar. 2, 2006: jury renders defense verdict.

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Sunburst Works Refinery $41M verdict

In 1955, there was a gasoline pipeline leak at the Sunburst Works Refinery that caused minor contamination of a 19-acre underground site. Texaco cleaned the spill at the time, and did further millions of dollars of cleanup starting in 1993. State regulators determined that there was no health effects, and that benzene levels in Sunburst, Montana were no different than in areas unaffected by the spill. The state Department of Environmental Quality ruled that nothing more needed to be done beyond additional monitoring, not least because the groundwater at issue isn’t used for anything–even livestock find it “naturally too briny” to drink.

Not good enough, say some residents and their lawyers, who blame the half-century-old spill for a variety of illnesses from arthritis to mononucleosis. They sued to require additional multi-million dollar cleanup. The plaintiffs originally sought damages for decreased property values, though townpeople who refused to join the lawsuit say that the main cause of the decreased property values is bad publicity from the 2001 lawsuit. (There are only 82 plaintiffs in a town of about 400.) Texaco acknowledges responsibility for the spill, but disputed the need to spend millions more on a clean-up methodology of little efficacy. The judge refused to allow Texaco to introduce evidence that they did exactly what the Montana regulators asked them to do, and a jury awarded a $41 million verdict, including $25 million in punitive damages. Texaco will appeal. The case is important because the verdict could encourage other “double-whammy” lawsuits on companies who have already been spending millions to comply with the extensive state and federal environmental regulations. (Kathleen A. Schultz, “Texaco to appeal Sunburst ruling”, Great Falls Tribune, Aug. 20; “Jury Rules Against ChevronTexaco In Cleanup Suit”, Wall Street Journal, Aug. 20 (sub – $); Reuters, Aug. 20; Kathleen A. Schultz, “Texaco must pay Sunburst $41M”, Aug. 19; Kathleen A. Schultz, “Texaco-Sunburst trial gets under way”, Jul. 26).

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First-rate bilge on secondhand smoke

Jacob Sullum eviscerates an embarrassingly bad op-ed that the New York Times chose to run yesterday (Rosemary Ellis, “The Secondhand Smoking Gun”, Oct. 15) on the issue of smoking in public places, based on the supposed “Helena miracle” — heart attacks in the Montana capital (population 26,000) are said to have dropped suddenly by 58 percent when smoking in public buildings was banned. The claim, he says, is based on a single unpublished study “involving tiny, highly volatile numbers”. Had the Times been interested in whether the asserted result would hold up as a matter of epidemiology, it could easily have checked out the experience of other jurisdictions which could offer much, much larger sample sizes than wee Helena: “why have we not heard about a dramatic drop in heart attacks [in New York City itself] since the city’s smoking ban took effect in April”? A few phone calls to Columbia-Presbyterian, St. Lukes-Roosevelt and the city’s other big hospitals should suffice to establish whether there had been any massive effect of this sort on New Yorkers’ proneness to cardiac arrest. (Reason Hit & Run, Oct. 16; Jacob Sullum, “Heartstopping Discovery”, Reason, Apr. 4). More: Cato’s Steven Milloy weighs in (“Secondhand smoke scam”, FoxNews.com, Oct. 17).

Read On…

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