Civil Procedure & Federal Courts Blog

*Update* Procedure Reforms in Texas -- Losing Plaintiffs Now Pay Costs/fees

Governor Rick Perry has signed a new tort reform law into effect in Texas.  The Houston Chronicle reports that the law will shift court and attorney costs to losing plaintiffs and give judges "expanded powers" to dismiss "frivolous lawsuits."  The accounts I have read all report that it is losing plaintiffs (not losing parties) who must pay costs.  Anyone with more insight into this issue is welcome to contact me!

RJE

*UPDATE*

My bleg has worked!  Our very own Texan, Beth Thornburg writes:

The law, Download HB00274Final, actually requires the Texas Supreme Court to make rules for a new motion to dismiss (apparently on the pleadings – “dismissal of causes of action that have no basis on law or fact on motion and without evidence”), and to provide for a cost shift to the “prevailing party” when the motion is granted or denied.  So it looks to me like under the language of the bill, a defendant who unsuccessfully moved to dismiss could be ordered to pay the plaintiff’s attorney fees. 

The bill also changes a bit (and somewhat inscrutably) the offer of judgment rule. 

And it requires the Court to make rules for cheaper and faster disposition of cases where the amount in controversy is less than $100,000.

The full drafting history is available at http://www.capitol.state.tx.us/BillLookup/Text.aspx?LegSess=82R&Bill=HB274

 

 

 

 

Injunctions? Merits? Hangover?

For those of you anxiously awaiting the opening of the movie Hangover 2, there is some civ pro-oriented entertainment to keep us occupied in the meantime.  In the movie, Ed Helms' character wakes up in Bangkok with a face tattoo that mirrors Mike Tyson's (who also appears in this film).  The artist who designed Tyson's face tattoo sued Warner Brothers for copyright infringement.  Although the federal judge refused to grant an injunction which would bar the opening of the movie, he has stated that litigation on the merits can indeed go forward.

RJE

Commentary on AT&T Mobility v. Concepcion

We covered earlier the Supreme Court’s decision in AT&T Mobility v. Concepcion. Splitting 5-4, the Court held that the Federal Arbitration Act prevented the consumers from relying on state-law unconscionability principles in challenging a contractual waiver of the right to arbitrate disputes on a classwide basis. There’s been a lot of commentary on the case in the ensuing weeks. Here are some links:

Nan Aron, AT&T Mobility v. Concepcion: The Corporate Court Does it Again, at the Huffington Post. 

Aaron Bruhl (Houston), AT&T’s Long Game on Unconscionability, at PrawfsBlawg.

Aaron Bruhl (Houston), AT&T v. Concepcion and Adherence to Minority Views, at PrawfsBlawg.

Erwin Chemerinsky (UC Irvine), Supreme Court: Class (action) dismissed, Los Angeles Times Op-Ed.

Lawrence Cunningham (George Washington), SCOTUS AT&T Opinion Par for Rhetorical Course, at Concurring Opinions.

Michael Dorf (Cornell), Arbitration Decision Suggests SCOTUS Majority Are Pro-Business More Than Jurisprudential Conservatives, at Dorf on Law.

Ashby Jones, After AT&T Ruling, Should We Say Goodbye to Consumer Class Actions?, at the Wall Street Journal Law Blog.

Nathan Koppel, Will Federal Consumer Bureau Ride to the Rescue of Class Actions?, at the Wall Street Journal Law Blog.

Ken Klukowski, Trial lawyers lose to arbitration law in Supreme Court, Washington Examiner Op-Ed.

New York Times Editorial, Gutting Class Action

Opposing Views of Court's Ruling on Class Actions, Letters to the Editor, New York Times, from Arthur Miller (NYU) and Andrew Pincus.

Larry Ribstein (Illinois), Arbitration, preemption, and regulatory coordination, at Truth on the Market.

Lawrence Schonbrun, Supreme Court Ruling Is Not Bad News For Consumers, the Class Action System Is the Real Culprit, at the Huffington Post

--A

(Updated 5/23/11)

The Continuing Procedural Battle in the Chevron (Ecuador) Case

Chevron has been battling a massive environmental lawsuit brought by citizens of Ecuador for years.  The case began with a procedural bang: Chevron successfully convinced the S.D.N.Y. to dismiss the case for forum non conveniens in favor of trying the case in Ecuador.  The Ecuadorian court found for the plaintiffs, assessing one of the largest judgments in history on Chevron ($18 billion), and have filed lawsuits in the U.S. to attach Chevron's property and enforce the judgment.  

Now Chevron is challenging enforcement, having secured a preliminary injunction from the S.D.N.Y. as to enforcement and attachment.  The plaintiffs have now asked the Second Circuit to lift the injunction -- in part because it blocks access to funds that the plaintiffs' lawyers believe they need in order to fight a racketeering lawsuit that Chevron has brought against the plaintiffs and the Ecaudorian government.

This ongoing procedural battle is definitely one to keep watching.

RJE

N.Y. Times Editorial on Wal-Mart v. Dukes

This editorial about the Wal-Mart v. Dukes case, now pending in the Supreme Court, appeared in yesterday’s New York Times. From the text:

[D]uring oral argument last week, conservative justices and liberals to some degree expressed skepticism: Is there enough “cohesion” among the women to justify treating them as a single class? If so, how could a solo trial judge manage such an enormous class action?

A brief by 31 professors of civil procedure explains why the women are a suitable class. Their claims meet the core test: They have in common the question of whether Wal-Mart discriminated against them. Meanwhile, the high cost of litigation compared to the low likely individual recoveries would make it hard for the women to proceed any other way. …

If the court has doubts about whether the class is cohesive or manageable enough, it should ask the trial judge to explore whether there is a single class or more than one — say, salaried female employees and hourly employees or female store managers and other kinds of employees. That would be much fairer than dismissing the case and insisting that 1.5 million women fend for themselves.

--A

Judge Sentences Juror to More Jury Duty

From my home turf of Brooklyn, we have this stunning account of a woman's racist comments on jury duty.  When the judge sensed that she made "wildly racist" and anti-law enforcement comments simply for the purpose of being excused, he informed her that she will have to show up for jury duty...indefinitely.  He eventually excused her, but not before giving her a stern lecture.

RJE

SCOTUS Habeas Decision

Today, the Supreme Court handed down yet another habeas decision.  

 Cullen v. Pinholster, No. 09-1088. A federal court conducting review of a state prisoner's habeas corpus petition under 28 U.S.C. §2254(d)(1), which authorizes relief if the decision of a state court that adjudicated the claim on the merits was "contrary to, or involved an unreasonable application of, clearly established Federal law," is limited to the record that was before the state court.

More details are available at the ever-reliable SCOTUSBlog.

RJE

 

While you were thinking about Dukes v. Wal-Mart...

The 11th Circuit recently decided Fitzpatrick v. General Mills, ordering a distrct court to broaden the class it certified.  Fitzpatrick is a class action brought by plaintiffs who believe that General Mills overcharged them for "probiotic yogurts" such as Yo Plus and misled them as to any existing health benefits.  

The 11th Circuit not only approved of the class action, but suggested that the class does not need to be limited to consumers who relied on statements concerning the yogurt's health benefits.

RJE

SCOTUS Oral Argument in Wal-Mart v. Dukes

The Supreme Court hears argument today in Wal-Mart Stores, Inc. v. Dukes. The questions presented are:

Whether claims for monetary relief can be certified under Federal Rule of Civil Procedure 23(b)(2)—which by its terms is limited to injunctive or corresponding declaratory relief—and, if so, under what circumstances.

Whether the class certification ordered under Rule 23(b)(2) was consistent with Rule 23(a).

SCOTUSblog’s case file is available here, which contains links to the Ninth Circuit opinion below and the briefing in the case.

There is a ton of coverage on the case and the upcoming argument, including:

• ABA Journal
• Associated Press
• The Atlantic
• Chicago Tribune
• CNN
• How Appealing
• New York Times
• SCOTUSblog
• Washington Post

 An amicus brief filed in the case by thirty-one civil procedure professors is available here.

 --A

Judge Chin Rejects Google Books Settlement

Judge Chin (SDNY) rejected the settlement negotiated in the Google Books class action case.  He worries that the settlement would be unfair to copyright owners and suggested that an opt-in format would be preferable to the current opt-out settlement.

The New York Law Journal covers the decision here.  A copy of the proposed settlement is available here.

RJE 

Witness Statements from Congressional Hearing on the Lawsuit Abuse Reduction Act

Statements from the three witnesses at today’s congressional hearing on H.R. 966 (covered earlier here) are now available. Here are the links:

Elizabeth A. Milito
NFIB Small Business Legal Center

Lonny Hoffman
University of Houston Law Center

Victor E. Schwartz
Shook, Hardy & Bacon L.L.P.

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Congressional Hearing On Legislation To Amend FRCP 11: The Lawsuit Abuse Reduction Act (H.R. 966)

The House Judiciary Committee’s Subcommittee on the Constitution is holding a hearing tomorrow (March 11th) at 10:00 a.m. on H.R. 966. The legislation is entitled the "Lawsuit Abuse Reduction Act of 2011," and its purposes include "[t]o amend Rule 11 of the Federal Rules of Civil Procedure to improve attorney accountability."

Information on the hearing is available here, and the text of the bill can be found here. Here is the witness list:

Elizabeth A. Milito
NFIB Small Business Legal Center

Professor Lonny Hoffman
University of Houston Law Center

Mr. Victor E. Schwartz
Shook, Hardy & Bacon L.L.P.

If you’re in D.C. and want to check it out, the location is 2141 Rayburn House Office Building.

--A

SCOTUS Oral Argument in Bond v. United States

Yesterday the Supreme Court heard oral argument in Bond v. United States, covered earlier here, which presents the question: 

Whether a criminal defendant convicted under a federal statute has standing to challenge her conviction on grounds that, as applied to her, the statute is beyond the federal government’s enumerated powers and inconsistent with the Tenth Amendment.

Here are links to the oral argument transcript, a story about the case by Adam Liptak in today’s New York Times, and Dahlia Lithwick's story on Slate entitled "The Case of the Poisoned Lover: The Supreme Court gets its sexiest case ever, but all it wants to talk about is standing," which begins:

When the Lifetime Channel casts the movie version of Bond v. U.S., it will doubtless pit someone Valerie Bertinelli-ish against someone Judith Light-like and leave all the good 10th Amendment stuff on the cutting room floor.

--A

PS: For readers interested more in the “Civil Procedure” rather than the “Federal Courts” side of our ledger (not to mention casting options for a potential made-for-TV movie), there’s a reference to Twombly, Conley, and pleading standards on p.16 of the oral argument transcript. Petitioner's counsel was asked how the Court should treat some language in an earlier opinion (Tennessee Electric Power v. TVA) indicating that only states, not individuals, have standing to raise this sort of constitutional challenge. Counsel responded: “[I]f you ask me what you should do with it, you should do what you did in Twombly, with some language in an opinion that had continued to cause trouble in the 50 years since. You should just say that's no longer good law because it's not.”

Coming Soon To A House Subcommittee Near You?

From David Ingram at Blog of the Legal Times comes the story New Group in Congress Pushes to Change Legal System. Initiated by six members of the House of Representatives, the newly-formed Congressional Civil Justice Caucus will be promoting “an array of changes to the civil justice system, including proposals related to medical malpractice reform, venue and federal pleading standards.”

--A

SCOTUS Litigant Extraordinaire Anna Nicole Smith Now Has an Opera

For those of us who teach the very important Anna Nicole Smith cases, such as Marshall v. Marshall, we can add another teaching arrow to our quiver.

The London Telegraph reports that an Anna Nicole Smith opera will be opening next month at Covent Garden. 

Now we know for sure what opera and the Supreme Court have in common.

RJE

Rep. Kucinich: My Lawsuit Allegations Are Private!

Representative Dennis Kucinich is suing the House of Representatives cafeteria over an olive pit in a sandwich.  He alleges that biting into the sandwich resulted in extensive dental damage.

Although it's not really a civ pro matter, I couldn't help but chuckle at the response of his spokesman: "It truly is a private matter."  That might have been the case, but perhaps he's learned a lesson in the joys of the public record.

RJE

NY Times Story on Lack of Clarity in SCOTUS Opinions (See, e.g., Iqbal; Twombly)

This week’s New York Times contains an article by Adam Liptak titled Justices Are Long on Words but Short on Guidance. From the article:

The Supreme Court under the leadership of Chief Justice John G. Roberts Jr. is often criticized for issuing sweeping and politically polarized decisions. But there is an emerging parallel critique as well, this one concerned with the quality of the court’s judicial craftsmanship. In decisions on questions great and small, the court often provides only limited or ambiguous guidance to lower courts. And it increasingly does so at enormous length.

Among the examples provided are Twombly and Iqbal:

In a pair of civil procedure decisions in 2007 and 2009 that have been cited many thousands of times, the court gave trial judges more authority to throw out cases early based on, in the words of the later decision, their “experience and common sense.” That standard, Arthur R. Miller wrote last month in The Duke Law Journal, is “shadowy at best” and has caused “confusion and disarray among judges and lawyers.”

--A 

NY Times Story on Litigation Financing

Sunday’s New York Times contains an article Investors Put Money on Lawsuits to Get Payouts, which begins:

Large banks, hedge funds and private investors hungry for new and lucrative opportunities are bankrolling other people’s lawsuits, pumping hundreds of millions of dollars into medical malpractice claims, divorce battles and class actions against corporations — all in the hope of sharing in the potential winnings.

The loans are propelling large and prominent cases. Lenders including Counsel Financial, a Buffalo company financed by Citigroup, provided $35 million for the lawsuits brought by ground zero workers that were settled tentatively in June for $712.5 million. The lenders earned about $11 million.

Most investments are in the smaller cases that fill court dockets. Ardec Funding, a New York lender backed by a hedge fund, lent $45,000 in June to a Manhattan lawyer hired by the parents of a baby brain-damaged at birth. The lawyer hired two doctors, a physical therapist and an economist to testify at a July trial. The jury ordered the delivering doctor and hospital to pay the baby $510,000. Ardec is collecting interest at an annual rate of 24 percent, or $900 a month, until the award is paid.

--A

 

NYTimes Sunday Magazine Cover Story about BP Litigation

The Sunday Magazine of the New York TImes has a long and interesting feature on the role on organization of lawyers in the BP litigation with a particular emphasis on the personalities involved and their past association with complex litigation.  A very interesting read.

RJE

NYTimes Editorial Highlights Need for Lawyers to Low Income Litigants in Civil Cases

An editorial in today's New York Times describes the inability of budget constrained legal representation programs for low income litigants to provide enough lawyers to persons in civil cases.  It calls on the New York State Legislature and Congress to develop and fund programs that will fill this need.

RJE