Overlawyered: Chronicling The High Cost Of Our Legal System

Posts Tagged ‘tobacco’

Obese Arkansas Schoolkids

You probably heard a couple of months ago that the state of Arkansas decided to start providing the parents of school children with “report cards” on their kids’ weight. School children will have their “Body Mass Index” (BMI) measured at school, and the results sent home. What I just learned today, from this MSNBC story, is where the funding originated for the obesity report cards: “The BMI test came into existence as a result of a cash windfall to the state from a tobacco lawsuit settlement tagged to fund public health programs.”

It’s particularly ironic because decreased smoking, apparently, is one of the major factors promoting the American obesity epidemic.

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Abusive litigation, with a Bush imprimatur

Despite Republican pronouncements critical of overreaching litigation, the Bush Department of Justice has insisted on pursuing the racketeering lawsuit against cigarette makers that it inherited from the Clinton people (May 29, more). “Until the president does something about the DOJ’s rogue $280 billion lawsuit against the tobacco industry, cries about John Edwards’ trial lawyer connections will ring hollow.” (Steven Milloy (Cato Institute), “Injustice at the Justice Department”, FoxNews.com Views, Jul. 9). More: Vanessa Blum, “Drowning in Paper”, Legal Times, Mar. 18.

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A new regulatory regime for tobacco?

Fred Smith, the president of the Competititve Enterprise Institute, makes the case against pending federal legislation that would “[p]ut the Food and Drug Administration in charge of regulating tobacco in exchange for a buyout of farming quotas.” The proposed deal would, according to Smith, “strengthen the nanny state at the expense of individual choice, increase black market activity, hurt lower-income consumers, and, perversely, create new health risks for all Americans.” (Fred L. Smith, Jr., “The FDA poses threat to our health, liberty,” Investor’s Business Daily, June 21 (PDF file)).

Quota buyout legislation was passed by the House of Representatives on June 17 as title VII (the “Fair and Equitable Tobacco Reform Act of 2004”) of H.R. 4520, the “American Jobs Creation Act of 2004.” The focus now shifts to the Senate, which is apparently considering the deal outlined by Smith’s op-ed. For more on this, see Will Snell & Kelly Tiller, “Fair and Equitable Tobacco Reform Act of 2004,” U. of Ky. Dept. of Ag. Econ., June 2004 (PDF file); Jasper Womach, “Tobacco Quota Buyout Proposals in the 108th Congress,” Congressional Research Service, updated April 6 (PDF file); Blake Brown & Gary Bullen, “Tobacco Buyout,” N.C. State U. Dept. of Ag. & Resource Economics.

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Scruggs watch

Last week lawyers associated with uber-tobacco lawyer Richard Scruggs fanned out across the country to file a dozen lawsuits against thirteen large non-profit hospitals in eight states. According to one press account, the lawsuits allege that “the institutions are not living up to their charitable missions, are overcharging uninsured patients and are using overly aggressive collection tactics.” (Rob Kaiser, “Class actions filed against non-profit hospitals,” Chicago Tribune, June 18) Scruggs characterizes the litigation as his attempt “to stop profiteering by nonprofit hospitals.” (Bill Lewis, “St. Thomas among hospitals accused of ‘profiteering,'” Nashville Tennessean, June 18)

The Tennessean article further explains:

“The lawsuit said Saint Thomas unfairly benefits from its long-held tax-exempt status, and the suit alleges a breach of contract, consumer fraud and deceptive business practices because Saint Thomas and the other nonprofits allegedly haven’t provided enough charity care in return for their tax exemptions….

“He criticized the hospitals named in the lawsuits for charging what he said were their highest rates to patients who do not have insurance, while giving discounts to big insurance companies. If the poor or uninsured patients cannot pay their bills, the hospitals garnishee wages and bank accounts, seize houses and force people into bankruptcy, he said.”

University of Chicago law professor Richard Epstein, quoted in the Tribune article, had this reaction: “Dicky Scruggs has got a lot of money, and he’s looking for a lot of trouble,” Epstein said. “The question is, what’s the law that’s being violated?”

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John O’Quinn for Texas governor?

The Houston-based mass tort specialist, who has long played a prominent role in these columns for his exploits in asbestos, tobacco, silicone implants and most recently fen-phen (Apr. 28, Feb. 26 and many more), is now being talked of by activists as a potential Democratic candidate for governor of the Lone Star State. (W. Gardner Selby, “Democrats appear to be in no rush to challenge Perry for governorship”, San Antonio Express-News, Jun. 15). One factor helpful to him: last fall (see GregsOpinion.com, Oct. 25) Texas Democrats elected as their chairman San Marcos attorney Charles Soechting, who happens to practice at none other than the law firm of O’Quinn, Laminack & Pirtle.

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Massachusetts tobacco fees: “Greed on Trial”

“The question before the jurors was not whether legal fees amounting to $7,700 an hour were ‘unreasonable.’ It was whether the lawyer-plaintiffs should get $1.3 billion more.” Detailed account of tobacco-fee buccaneering and the resulting courtroom antics (complete with “trained-seal” expert witnesses) in one state. When contemplating the tobacco crusade, the chief of litigation at Brown Rudnick said, “I had dollar signs in my eyes, even back at that early stage. And I know that they were large dollar signs.” (Alex Beam, The Atlantic, Jun.). For our coverage of Massachusetts tobacco fees, see Nov. 4 and links from there.

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Triple whammy for tobacco

Bad legal news comes in threes for cigarette makers: federal judge Gladys Kessler has ruled that the U.S. Department of Justice will be allowed to ask for disgorgement of $280 billion in past tobacco industry profits in the federal racketeering case against the industry (Nancy Zuckerbrod, “Judge: Government Can Seek Tobacco Profits”, AP/Washington Post, May 24)(more on suit). Health-program recoupment suits similar to those successfully pressed by state governments in the U.S. have been almost uniformly rejected in foreign courts, but an exception may be shaping up in Canada, where an appeals court in the province of British Columbia has just given its go-ahead to such a suit (Rod Mickleburgh, “Court upholds B.C.’s right to launch ‘big tobacco’ suit”, The Globe and Mail, May 21). And: “In the first verdict of its kind in the nation, a New Orleans jury decided Friday that four big tobacco companies should pay $591 million for a comprehensive, 10-year smoking-cessation program for a half-million or so of their Louisiana customers.” (Susan Finch, “Jury tells tobacco firms to pay up”, New Orleans Times-Picayune, May 22). More: On a somewhat brighter note, the California Assembly has narrowly defeated the scary bill sponsored by Assemblyman Marco Firebaugh and backed by the American Lung Association that would have prohibited parents from smoking in cars in which their children were riding (see Apr. 30) (Steve Lawrence, “Assembly rejects bill to bar smoking in cars carrying young kids”, AP/SignOnSanDiego, May 28); for more news on secondhand smoke controversies, see updates appended to post of Oct. 16, 2003 (scroll to end).

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For your own good

From the Canadian Arctic: “On May 1, the workers’ compensation board for Nunavut and neighboring Northwest Territories prohibited smoking in any enclosed business or work site, including office buildings and bars. Ever since, smokers have been required to step outside to smoke in a region where temperatures can drop farther than 40 below zero in winter.” (Clifford Krauss, “Snuffing Out a Smoky Way of Life in the Canadian Arctic”, New York Times, May 21).

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“String Of Fast-Food Suits Expected By End Of Year”

The plaintiffs’ bar regularly pooh-poohs efforts at legal reform (Mar. 11, Mar. 13) to prevent a shakedown blaming the food industry for obesity by noting that no anti-obesity lawsuit has succeeded yet. (For example, blogger-lawyer Evan Schaeffer claims that the publicity of obesity litigation is really a conspiracy of the defense bar to generate fees.) A Lawyers Weekly USA puts the lie to this by talking to the plaintiffs’ bar; Trial Lawyers Inc. clearly thinks that obesity lawsuits are a profitable new business opportunity. (Elaine McArdle, “String Of Fast-Food Suits Expected By End Of Year”, Lawyers Weekly USA, May 10 (and can temporarily be found here); Laura Parker, “Legal experts predict new rounds in food fight”, USA Today, May 6; Alex Beam, “A super-size portion of half truths”, Boston Globe, May 11). As with the tobacco lawsuits, the strategy is to keep filing frivolous lawsuits until random chance assigns a sympathetic judge who writes an opinion that creates a precedent that opens the doors for future lawsuits–and John Banzhaf and other plaintiffs’ lawyers claim that has already happened.

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