Saturday, December 8, 2007

Attorney's Fee in the Swiss Bank Litigation

Magistrate Judge James Orenstein approved a $3.1 million attorney’s fee award to NYU Professor Burt Neuborne for his work in representing the Holocaust victims in the Swiss bank litigation. Neuborne is scheduled to speak on a panel about Representation and Conflicts of Interest in Class Actions and Other Group Actions next week at the Globalization of Class Actions Conference in Oxford, England. New York Law Journal has more information on the attorney’s fee award. Here’s an excerpt:

Attorney Burt Neuborne will receive $3.1 million in fees for representing Holocaust victims in litigation that resulted in a $1.25 billion settlement with Swiss banks.

Eastern District of New York Judge Frederic Block said Thursday that Neuborne deserved the payout for work he did as lead settlement counsel in rendering post-settlement services beginning in January 1999. His previous work on behalf of those who claimed that the Swiss banks collaborated with the Nazis had been pro bono.

The decision was the latest in a series of Neuborne's application for fees, which had been vehemently opposed by attorney Robert A. Swift of Swift Kohn & Graf and others who claimed Neuborne had volunteered to perform post-settlement work for free.

Swift, who represented the class, and Samuel J. Dubbin, a Florida lawyer who filed objections to the award on behalf of 17 individual class members and the Holocaust Survivors Foundation USA, later withdrew those objections after Magistrate Judge James Orenstein issued the report and recommendation ultimately endorsed Thursday by Block.

"I'm relieved," Neuborne said Thursday. "It was an unpleasant process and I'm glad it's over."

Neuborne had set the lodestar fee $5.7 million, an amount he said represented 8,178.5 hours at a rate of $700 per hour. He then said he deemed it appropriate, in keeping with the practices of special master and the "unique nature of the litigation," to discount that fee by about 25 percent to $4.1 million.


December 8, 2007 in Settlement | Permalink | Comments (0) | TrackBack (0)

Friday, December 7, 2007

Richard Epstein Webcast on Riegel v. Medtronic

The Federalist Society has posted a webcast of Professor Richard Epstein discussing the recent U.S. Supreme Court case, Riegel v. Medtronic, which addresses possible preemption of state tort suits for FDA-approved medical devices.  Epstein says the Court might rule 9-0 in favor of preemption.


December 7, 2007 in FDA, Medical Devices - Misc. | Permalink | Comments (0) | TrackBack (0)

Sheila Birnbaum and Pro-Insurance Katrina Appellate Rulings

The Wall Street Journal has an article -- Rulings Bolster Insurers, by Liam Plevin and Peter Lattman -- that discusses the tide of pro-insurance appellate rulings in the Katrina litigation.  The Journal's Law Blog also celebrates State Farm's outside counsel, Sheila Birnbaum of Skadden Arps, as the Law Blog Lawyer of the Day

I worked with Sheila Birnbaum while I was at Skadden, and can second the Law Blog's comments.  Mass tort litigation remains an unsettled, developing phenomenon, and Sheila's deep understanding of the issues, born of her many years as a law professor at NYU and Fordham, is an invaluable asset -- as is shown particularly by her mastery of appeals and complex negotiations.  In the continuing history of mass torts, now several decades old, Sheila should surely be seen as among the handful of most influential lawyers.


December 7, 2007 in Mass Disasters | Permalink | Comments (0) | TrackBack (0)

California Ford Explorer Settlement Agreement

The recent settlement agreement in the California state court class action against Ford Motor Company is available through the Superior Court of California’s website. The system doesn’t provide a direct link, but if you follow this link, then click "other," and enter JCCP 4266/4270, the November 29th agreement is currently the sixth document listed. Although I haven’t had a chance to read the full 273 pages, the pertinent compensation and attorneys’ fees are described in paragraph 34. Paragraph 34(e), covering attorneys’ fees, reads as follows:

e. Plaintiffs and Class Counsel may apply to the Court for an award of reasonable attorneys' fees and expenses incurred by them in litigating the Related Actions. Ford agrees to pay an award of attorneys' fees and expenses that is determined by the Court to be reasonable, does not exceed an aggregated total of $25 million for fees and expenses incurred in litigating the Related Actions, and is included in the Final Order and Judgment as of the Effective Date of Settlement. This amount includes any award for attorneys' fees in connection with securing final approval of this Agreement by the Court at the Fairness Hearing. Ford does not agree to pay for any additional attorneys' fees or expenses that may be incurred by or on behalf of Plaintiffs, the Settlement Class, or any Settlement Class Member after the date on which this Agreement is approved by the Court in, and by entry of, the Final Order and Judgment at or following the Fairness Hearing. Class Counsel and Plaintiffs agree not to seek, accept, or enforce, on behalf of themselves, any others, or any combination of themselves and any others, any award of attorneys' fees and expenses that in the aggregate exceeds $25 million. In no event shall Ford be obligated to pay Plaintiffs, Settlement Class Members, Class Counsel, or other counsel in aggregate any attorneys' fee, cost, or expense in any amount greater than the amount specified in this Paragraph for any activity or cost related to any of the Related Actions, the negotiation or implementation of this Agreement, or the allegations that form, or could have formed, the basis of any of the Related Actions, or any combination of the foregoing. Failure of the Court to approve attorneys' fees and expenses of the full amount requested by Plaintiffs or Class Counsel, or approval by the Court of any amount of attorney fees and expenses less than the amount sought by Plaintiffs or Class Counsel, shall not affect any of the other terms of this Agreement. Ford shall deliver to Class Counsel payment of the final award of attorneys' fees, costs and expenses no later than ten (10) days after the Effective Date of Settlement. Ford, in its sole discretion, and upon consultation with Class Counsel, may agree to commence issuance of Certificates and/or Settlement benefits and/or payment of Court-awarded attorneys' fees, costs and expenses before the Effective Date of Settlement.


December 7, 2007 in Settlement | Permalink | Comments (0) | TrackBack (0)

Thursday, December 6, 2007

Judge Weinstein's Numerous Mass Torts & The "Related Case" Designation by Plaintiffs

Point of Law flags a recent story in the New York Sun -- Judge Lands at Center of a New York Legal Mystery, by Joseph Goldstein -- which chronicles the use of the "related-case" designation by plaintiff's lawyers to maneuver their cases before Judge Weinstein in the Eastern District of New York. 

I first encountered plaintiffs' use of this device as a lawyer for defendants in the Simon II tobacco case, which plaintiffs had put before Judge Weinstein as a "related case."  A court might justifiably want to keep related cases before a judge with related cases -- there's an argument that it's inefficient to educate multiple judges about the same complex factual and legal issues.  But the devil is in the details.  Take a look at the Eastern District of New York civil action cover sheet: Download js44-45.pdf .  The cover page has a section asking whether there are "RELATED CASE(S) IF ANY" and includes a line for Judge and Docket Number.  The plaintiff then has the ability to list any case and judge on the line, and then I believe the case is automatically routed to that judge. 

The problem is that there may be multiple judges in a district who have cases that are arguably related to the plaintiff's case.  The plaintiff might list whichever judge the plaintiff believes is most inclined to the plaintiff's position -- a system that biases judge selection in favor of plaintiffs.  And then as the article notes, the defendant may be held to have no standing to challenge the "related case" judge selection by plaintiffs, on the remarkable grounds that it is an administrative determination when in fact  the determination has been made not by an administrator or a judge, but by opposing counsel.  Imagine that the first judge plaintiffs get in a mass tort is one who they don't like; then when filing another case, they list no related case, and hope for another particular judge; finally, once the desired judge is obtained, then all future cases are checked as "related" to that cases before that desired judge only. 

A better system would be for plaintiffs lawyers to be informed that they are ethically bound to list every case and judge that counsel is aware the case might be reasonably considered related to.  If the "related case" box is checked, the court -- through administrators or a judge committee -- should undertake an independent review of whether any other cases and judges are implicated.  (For example, court administrators could circulate a weekly "related case" email to clerks, asking if their judges have any cases that are related.)  If several judges are involved in the cases, then the case should be randomly assigned among those judges -- unless the court makes its own decisions to centralize all cases before a single judge for administrative reasons.  Case assignment to judges is a decision that should be made by the court, not the litigants -- and certainly not only one type of litigant.


December 6, 2007 in Asbestos, Ethics, Procedure, Tobacco | Permalink | Comments (2) | TrackBack (2)

Clermont & Eisenberg on CAFA (and Republican male judges)

Kevin Clermont and Theodore Eisenberg have posted their new paper, CAFA Judicata, on SSRN. They presented their findings at the University of Pennsylvania’s CAFA symposium last weekend. Here’s the abstract:

The Class Action Fairness Act has taken on its real form through construction by the federal judges. That form emerges in this empirical study of judicial activity and receptivity in regard to the Act. Our data comprise the opinions under the Act published during the two and a half years following its enactment in 2005.

CAFA has produced a lot of litigation in its short life. The cases were varied, of course, but most typically the resulting published federal opinion involved a removed contract case, with the dispute turning on the statute's effective date or on federal jurisdiction. Even though the opinions shed some light on issues such as jurisdictional burden and standard of proof, most of the judicial activity was socially wasteful litigation. It emphasized transitional efforts to interpret sloppily drafted provisions.

More interesting, we saw wise but value-laden resistance by judges to CAFA, as they interpreted it in a way to dampen the early hopes of overly enthusiastic removers. Regression analysis confirms the suggestion that one can derive from percentages of cases decided in certain ways. With the exception of Republican male judges, the federal judiciary has not warmly embraced the statute.


December 6, 2007 in Mass Tort Scholarship | Permalink | Comments (0) | TrackBack (1)

Balducci Pleads Guilty; Scruggs Pleads Not Guilty

According to an article in the L.A. Times -- Lawyer admits bribing judge, from the Associated Press -- lawyer Timothy Balducci has pleaded guilty to attempting to bribe a Mississippi judge in the Katrina insurance litigation.  Dickie Scruggs, however, has pleaded not guilty.


December 6, 2007 in Ethics, Mass Disasters | Permalink | Comments (0) | TrackBack (0)

Wednesday, December 5, 2007

Robles Sentenced to 15 Years

Plaintiffs' mass tort lawyer Louis Robles was sentenced yesterday to the maximum 15 years for stealing settlement money from clients he represented in asbestos litigation.  Here's an excerpt from the Sun Sentinel:

A Miami attorney who admitted stealing more than $13 million from thousands of clients suffering from asbestos-related illnesses was sentenced Tuesday in Miami federal court to 15 years in prison.

Louis Robles, 59, once known as the "King of Torts," pleaded guilty in September to three counts of mail fraud, each carrying a possible five year sentence. U.S. District Judge Alan Gold, who had rejected an earlier plea agreement he thought was too lax, sentenced Robles to the maximum prison term.

Between 1989 and 2002, Robles collected more than $164 million on behalf of roughly 7,000 clients suing asbestos companies. In the mid-1990s, he began dipping directly into settlement proceeds without his clients' knowledge to fund an extravagant lifestyle, prosecutors said.

For earlier proceedings, see posts on April 19Sept. 17, and Sept. 24.


December 5, 2007 in Asbestos, Ethics | Permalink | Comments (0) | TrackBack (0)

Plaintiff Verdict in Welding Fumes Trial

Jeff Tamraz, a plaintiff in the Welding Fume Product Liability Litigation MDL in the Northern District of Ohio, won a $20.5 million verdict today, according to this news release.  The litigation involves claims that manganese fumes from welding rods cause Parkinson's Disease.  Welding rod defendants had won the vast majority of cases to go to trial, and an August 2007 industry report on the litigation reported that the lawsuits were on the decline.  Whether today's verdict will reinvigorate the litigation or encourage settlement of other cases remains to be seen.


Clarification:  The $20.5 million reflects total damages; the jury awarded $17.5 million to Tamraz plus $3 million to his wife.

December 5, 2007 | Permalink | Comments (0) | TrackBack (0)

FDA Preemption Cases

The Supreme Court heard oral arguments yesterday in Riegel v. Medtronic (06-179), the transcript is available on the Supreme Court’s website. Riegel presents the question of whether federal law preempts state lawsuits against FDA approved medical devices. The Riegels sued Medtronic, the manufacture of a balloon catheter, which burst during the dilation of Mr. Riegel’s coronary artery. The case raises federalism issues, asking whether federal agencies or state governments should make these types of health and safety decisions. Commenting on the case, the New York Times reports:

[I]n 2004, the Bush administration reversed the government’s position and began to take the manufacturers’ side, as it did before the justices on Tuesday in an argument by a deputy solicitor general, Edwin S. Kneedler. Explaining the change in policy, Mr. Kneedler said that in 2004, the F.D.A. "recognized that there would be a serious undermining of F.D.A.’s approval authority and its balancing of the risks and benefits if a state jury could reweigh those."

A question in this case, Riegel v. Medtronic Inc., No. 06-179, is whether the court will give the government’s position the usual deference it accords an agency’s interpretation of its basic statute.

The federal law at issue is the Medical Device Amendments of 1976, which in its section on preemption bars states from imposing on medical devices "any requirement which is different from, or in addition to, any requirement applicable under this chapter."

Beginning with a case in 1992 about warning labels on cigarette cartons, the Supreme Court has treated the word "requirement" as including not only obligations directly imposed by state laws and regulations, but also the award of damages by state tort systems.

For a jury to say, "Well, gee, it should have been done differently in this particular situation" is the equivalent of imposing a requirement in addition to federal approval, Theodore B. Olson, the lawyer representing Medtronic, told the justices.

"The F.D.A. is the right place for these decisions to be made and this balancing process to occur," Mr. Olson said, adding that while "nothing is perfectly safe," it would harm consumers to "discourage the marketing of products that might save our lives." Medtronic no longer makes the balloon catheter, called Evergreen, involved in the case.

In other FDA-related news, several amicus curiae filed their briefs in Warner-Lambert v. Kent (06-1498) on November 28, 2007. It doesn’t appear that the Supreme Court has scheduled oral argument yet. SCOTUSblog provides an overview:

Six years ago, in Buckman v. Plaintiffs’ Legal Committee, the Supreme Court held that state-law claims alleging that the manufacturer of orthopedic bone screws made fraudulent representations to the Food and Drug Administration ("FDA") were impliedly preempted by the Federal Food, Drug, and Cosmetic Act. On Tuesday, the Court granted certiorari in No. 06-1498, Warner-Lambert Co. v. Kent, to clarify the scope of its holding in Buckman: specifically, whether a state product liability statute that creates a general "safe harbor" from liability for FDA-approved drugs but carves out an exception for cases in which the approval was obtained through fraud is also preempted.

Under Michigan law, an FDA-approved drug cannot be deemed defective or unreasonably dangerous for product liability purposes unless the approval was obtained through fraud. Pursuant to this state statute, the respondents – all Michigan citizens – filed suit in Michigan state court, alleging that they were injured by Rezulin, a diabetes drug approved by the FDA but ultimately withdrawn from the market by Warner-Lambert. The case was removed to federal district court in Michigan and then subsequently transferred to the Southern District of New York by the Judicial Panel on Multidistrict Litigation. Warner-Lambert moved for judgment on the pleadings, arguing that under Buckman the claims were impliedly preempted, and the district court agreed.


December 5, 2007 in Medical Devices - Misc. | Permalink | Comments (0) | TrackBack (0)

More on Rejection of Lead-Paint Market-Share Liability

The Federalist Society's November 2007 State Court Docket Watch contains Missouri and New Jersey Courts Reject "Market Share" Liability for Lead Paint Manufacturers, by Brian Brooks, a partner at O'Melveny & Myers.


December 5, 2007 in Lead Paint | Permalink | Comments (0) | TrackBack (0)

Bhopal Revisited

This week was the 23rd anniversary of the Union Carbide toxic gas leak in Bhopal, India.  The world's worst industrial disaster, it claimed thousands of lives and unsurprisingly spawned major litigation.

As often happens with multinational mass tort litigation, the doctrine of forum non conveniens played a central role.  One of the ironies of forum non conveniens is that the defendant-movant describes the doctrine as a kind of international venue transfer while actually hoping it will serve as a litigation death knell.  A related irony is that on the issue of "adequate alternative forum" (one of the requirements under Piper Aircraft v. Reyno), U.S. defendants sing the praises of foreign legal systems while foreign plaintiffs bash their home courts.  So it was in the Bhopal litigation, but with the embarrassing twist that the one bashing the Indian legal system was the Indian government itself.

On the Indian blog Churumuri, Alok Prasanna offers an angry and pessimistic two-part series from Bangalore on the Bhopal litigation.  Yesterday's post -- How the Rajiv government screwed up on Bhopal -- tells the sorry story:  the aggressive solicitation of Indian plaintiffs by U.S. lawyers, the Indian government's self-anointment as sole representative plaintiff, the filing of U.S. litigation, the forum non conveniens dismissal, and the subsequent lawsuit and settlement in India.  Here's an excerpt in which Prasanna describes the Indian government's bungling of the litigation:

As initial reports of the pending flood of litigation claims started to trickle through, the Indian government, fearing exploitation, and an opportunity to turn this into an emotive, electoral issue, instantly passed a law prohibiting all but itself from representing the victims in any forum anywhere in the world. Then it went ahead and made a mockery of the move.
It filed suit in the District Court of New York, USA. ...

Before even the first papers had even been filed, the then-Prime Minister Rajiv Gandhi started making grandiose claims of a $2 billion compensation that his government would be seeking from [Union Carbide Corporation ("UCC")].  Big mistake.

Any lawyer would connect this statement to the filing of the suit in the USA and ask the American court to dismiss the case since the Indian Government was “forum shopping”, or in lay terms, simply looking for the best bargain. American Courts since 1981 had stopped entertaining foreign claims that could be filed elsewhere, but had been filed in the USA with the sole motive of getting a better award of damages. ...

To counter this, the Indian government made an even more stupid move. It claimed that the Indian judicial system was incompetent and inefficient to deal with the problem. It got professors and experts to file affidavits running down the Indian judicial system before American courts.

Humiliatingly, it was upto the UCC lawyers to defend the Indian judicial system asking for the case to be moved to India. They also pointed out the simple logistical problem of having to haul thousands of documents, mountains of evidence and thousands of witnesses halfway across the world for a trial.

Naturally no American court wanted to be stuck with an expensive, unending case on its hands and the district court of New York threw out the case. The Indian government cut a pretty sorry figure as it dragged itself to the district court of Bhopal, Madhya Pradesh for the next round of litigation. Before the same judicial system and judges it claimed were incompetent and inefficient.

As the litigation dragged on in the Indian courts, Union Carbide eventually settled for $470 million on terms that included dismissal of criminal charges.  Prasanna then describes a painfully slow disbursement process, and suggests that the Indian government as plaintiff was burdened by a serious conflict of interest:

The saga doesn’t end there. The long and painful process of disbursing the amount began and took about 20 years after the settlement. Long slow and laborious the “tribunals” set up by the Government to hand out the awards functioned pretty much like Courts and one needed the help of numerous touts, lawyers and doctors before rightly deserved compensation was gotten. The net result was that the victims didn’t get as much money or as quickly as was promised.

All of this can possibly attributed to run-of-the-mill bungling by the government. Except in this case, the government was as liable as UCC for the Bhopal gas tragedy. Both UCC and the Indian government were shareholders in UCIL. UCIL alone was too small (all assets amounting to Rs 100 crore only) to be made wholly liable for the affair. Any attempt to make UCC liable as a shareholder would automatically make the Indian government liable on an equal footing.

Take a step back and look at it from a distance. One of the defendants in the case, by using its sovereign powers, has usurped the claimants’ rights and ensured that it has not been made liable. It has gone to the extent of settling the case for a far lesser claim than promised instead of fighting for every last penny and virtually let the offenders go scot free.

Today's post -- And how the legal system screwed up on Bhopal -- discusses problems with Indian tort law, evidence, corporate veil-piercing, court resources, and Indian lawyers.  Prasanna sadly agrees with the experts who testified for India (that is, against India) on the forum non conveniens motion:

Remember the stand taken by the Indian Government before the New York district court regarding the inefficiency and incompetence of Indian Courts and legal system? Remember all those esteemed professors of law and legal mavens filing lengthy affidavits detailing the faults and flaws of the Indian legal system and judiciary?

Guess what, it was all true. There was no way in hell that the victims of Bhopal would have seen a single rupee of compensation had the case gone to trial in India.  The reasons are manifold, ranging from the inadequacy of the law to the incompetence of the lawyers.

The author's cynicism, however, is reserved for India.  Prasanna puts on rose-colored glasses when viewing U.S. mass tort litigation, laughably referring to Grisham's King of Torts as an example of how things ought to be done, but understandably looking to the U.S. mass tort experience for ideas on how mass-disaster compensation might have been better handled than it was in Bhopal:

So, do victims of mass disasters have no remedy or relief? Not really. Lawyers in the US and elsewhere had been developing this field of “mass torts” for some years and had mastered the skill of getting relief for their victims quickly without engaging in protracted litigation. Those who have read “The King of Torts” and other John Grisham books would have some idea of how this works and what are the advantages and pitfalls of this technique. Indian lawyers had no clue what was going on.

Indian lawyers stood exposed in the Bhopal tragedy. With little or no specialization in the various fields of law, the bewildering complexity of the problem and multi-disciplinary approach it needed completely befuddled Indian lawyers. Long used to adversarial, lengthy proceedings before courts, the legal fraternity had no answer to the kind of problems the Bhopal tragedy failed. While judges did try to solve the problem with a proactive approach towards interim relief and a bit of legal creativity, they were about as effective as Band Aids on a compound fracture.


December 5, 2007 in Mass Disasters, Procedure | Permalink | Comments (0) | TrackBack (1)

New Study on Lead in Popular Toys Released

The Associated Press reports on a study released today that tested many popular toys (purchased at well known retailers such as Toys "R" Us, Wal-Mart, etc.) found that 35% contain lead, many above federally mandated limits.  The AP article is available here.  An excerpt:

[Tracey Easthope, director of the Ecology Center's Environmental Health Project] said 17 percent of the children's products tested had levels of lead above the 600 parts per million federal standard that would trigger a recall of lead paint. Jewelry products were the most likely to contain the high levels of lead, the center said, with 33.5 percent containing levels above 600 ppm. Among the toys that tested above that limit was a Hannah Montana Pop Star Card Game, whose case tested at 3,056 ppm.

The American Academy of Pediatrics recommends a level of 40 ppm of lead as the maximum that should be allowed in children's products. Lead poisoning can cause irreversible learning disabilities and behavioral problems and, at very high levels, seizures, coma, and even death.

The timing of the study is inspired, of course, as it comes in the height of the shopping season, although some will already have completed their holiday shopping by now.  It certainly points to a need to rethink regulation (or the lack thereof) on this matter - whether it be through voluntary labeling, third party safety inspections or direct government regulation.  Will consumers reward markets, such as the EU, that regulate levels of hazardous chemicals in toys this season after the summer recalls?


December 5, 2007 in Lead Paint | Permalink | Comments (0) | TrackBack (0)

Tuesday, December 4, 2007

Supremes Grant Cert in Philippines v. Pimentel

Yesterday, the Supreme Court granted certiorari in Republic of the Philippines v. Pimentel, No. 06-1204.  The case is a proceduralist's dream and anyone else's nightmare:  the intersection of interpleader, class action, and compulsory party joinder.  The primary issue before the Supreme Court concerns Rule 19(b):  "Whether a foreign government that is a 'necessary' party to a lawsuit under Rule 19(a) and has successfully asserted sovereign immunity is, under Rule 19(b), an 'indispensable' party to an action brought in the courts of the United States to settle ownership of assets claimed by that government."

Pimentel is the class representative for a Rule 23(b)(3) class of 9,539 persons with claims against Ferdinand Marcos for human rights abuses; the class won a judgment of nearly $2 billion.  That was the case affirmed as Hilao v. Marcos (In re Estate of Marcos Human Rights Litigation (9th Cir. 1996), and notable to mass tort litigators not only as an example of a class action used to address human rights abuses, but also for its use of statistical sampling methods to award damages.

Then comes the interpleader.  Merrill Lynch was custodian of an account, opened by Ferdinand Marcos, containing $35 million.  The district court in the class action had awarded those assets to the plaintiff class.  But the Republic of the Philippines claimed ownership of the assets on the ground that Marcos had taken the money illegally.  Other claimants asserted an interest as well.  Perfect occasion for interpleader.  Merrill Lynch interpleads Pimentel as representative of the class, the Philippines, and other claimants.

The problem:  the Philippines successfully asserted sovereign immunity, gaining a dismissal.  The big question is whether, in the absence of the Philippines, the court must dismiss.  The court held that the country was a necessary party under Rule 19(a), but declined to dismiss under Rule 19(b).  The Philippines argues on appeal (another issue before the Supreme Court is whether a dismissed party has a right to appeal the Rule 19(b) decision) that in its absence the case must be dismissed.

More at Federal Civil Practice Bulletin and SCOTUSblog.


December 4, 2007 in Procedure | Permalink | Comments (0) | TrackBack (0)

Jennifer Wolsing on the Vioxx Litigation

Ssrn Jennifer Wolsing, an associate at Blackwell Sanders in St. Louis, has posted a working Wolsingj paper to SSRN -- The Vioxx Litigation: Disincenting Good Corporate Citizenship Through Misdirected Tort Rules.  Here's the abstract:

Though many believe that the tort system incents manufacturers to promote and manufacture their products safely, the Vioxx litigation proves that, in fact, the tort system functions as a disincentive against manufacturer transparency, scientific curiosity, and public safety. This Article examines the differences between Merck's liability for the pain reliever Vioxx and Pfizer's liability for its competing pain reliever, Celebrex. It concludes that the reason for Merck's increased product liability arises from its diligent efforts to protect the public. When Merck published studies examining Vioxx's cardiovascular safety, Merck provided plaintiffs with a wealth of data. By voluntarily withdrawing Vioxx, Merck alerted lawyers and potential plaintiffs to Vioxx's potential for harm. This Article examines several solutions to these perverse incentives, including FDA preemption at the state and federal level, the pending FDA Revitalization Act and FACT Act, Wagner's Burden-Shifting Proposal, and two market-based solutions. The Article concludes with its own market-based solution, which encourages the rapid release of study data and attempts to mitigate the red flag effect that occurs when a manufacturer voluntarily withdraws a potentially dangerous product.


December 4, 2007 in FDA, Mass Tort Scholarship, Procedure, Vioxx | Permalink | Comments (0) | TrackBack (0)

Judge Shopping

The New York Sun commented yesterday on Judge Jack Weinstein's popularity with mass tort plaintiffs and noted plaintiffs' tendencies for "judge shopping."  Here's an excerpt:

By and large, these suits, about 20 in all, against the tobacco and firearm industries didn't arrive on Judge  Weinstein's docket through a "spin of the wheel" — the random case assignment process by which suits are sent to judges. Instead, plaintiffs in the know have long used an administrative shortcut to maneuver lawsuits against the same set of defendants into the courtroom of their choice. Their choice is often Judge Weinstein.

In response, defense attorneys for the firearm and tobacco industries have alleged judge shopping and long tried to  get their cases yanked from Judge Weinstein's courtroom and reassigned, with mixed results. On Thursday, the issue  will come again to a head when a lawyer who has long represented the firearm industry, John Renzulli, will ask Judge Weinstein to recuse himself from a high-profile gun suit. The case was brought by New York City against out-of-state gun dealers who have sold handguns later recovered at crime scenes in the city.

It isn't the first time Mr. Renzulli has made this sort of motion — that was back in 1996. In the meantime, Judge  Weinstein's docket has drawn increasing scrutiny. There's even a judge on the 2nd Circuit, Jose Cabranes, who makes a  habit of quizzing lawyers about the matter when Judge Weinstein's rulings come up on appeal. "Is there a rule or practice in the Eastern District of New York that Judge Weinstein is assigned to all mega-cases?" the Judge Cabranes asked several years ago. The comments came during oral arguments reviewing Judge Weinstein's decision to try a case brought by Blue Cross and Blue Shield against the tobacco industry. The question has stuck with Judge Cabranes over the years. This September, he asked why the city's lawyers had taken a suit against firearm manufacturers "across the Brooklyn Bridge" to where Judge Weinstein sits, when the court in Manhattan was nearer to the city's law offices.

Judge Weinstein is known for his innovation in handling complex litigation matters.  Moreover, he's explicitly recognized the inherent commonalities between settling certified class actions and nonclass aggregation.  In the Zyprexa litigation, this led him to note that some conventions required for class litigation are likewise appropriate in nonclass aggregation. 

Of course, in the big picture post-CAFA scheme, we'll likely see an increase in judge shopping as plaintiffs attorneys' continue to adapt. 


December 4, 2007 | Permalink | Comments (0) | TrackBack (0)

More on the Scruggs Indictment for Allegedly Attempting to Bribe a Mississippi State Judge

The Wall Street Journal has more on the Dickie Scruggs indictment for allegedly attempting to bribe a Mississippi state judge in the Katrina insurance litigation -- It's Party Time for Mr. Scruggs, by Paulo Prada and Peter Lattman.  (Prior related posts are here and here.)  Some in the article who defend Mr. Scruggs speculate that perhaps Mr. Balducci, the less-well-known lawyer allegedly taped offering the bribe on behalf of him and Mr. Scruggs, was working on his own, trying to impress Mr. Scruggs.   

Interestingly, the best-selling author John Grisham, who is also a friend of Mr. Scruggs, defends Mr. Scruggs on the grounds of egregious plot:

"This doesn't sound like the Dickie Scruggs that I know," Mr. Grisham said yesterday. "When you know Dickie, and how successful he has been, you could not believe he would be involved in such a boneheaded bribery scam that is not in the least bit sophisticated."

We'll have to wait for Grisham's next novel to see how he can correct the plot to make it more convincing.  But as many a practicing lawyer knows, real law practice is often not as interesting as a Grisham novel.


December 4, 2007 in Ethics, Mass Disasters | Permalink | Comments (0) | TrackBack (0)

Monday, December 3, 2007

Issacharoff and Nagareda on Class Action Settlements

Sam Issacharoff and Richard Nagareda have posted on SSRN their new paper, Class Action Settlements Under Attack.  They presented the paper at the symposium on CAFA held last week at the University of Pennsylvania (which, by the way, turned out to be a really interesting conference with enough good papers to prove that, as a topic for scholarship, CAFA hasn't become boring yet).  Here's the abstract:

Settlements dominate the landscape of class actions, and the value of claims so resolved corresponds directly to the finality that the settlement offers. The law of class actions remains surprisingly unsettled, however, on where judicial review of class settlements may take place, what that review encompasses, and how the parameters for review should be defined. This article offers a cohesive account of the "where," "what," and "how" questions surrounding class settlement review, with particular attention to the long-running debate over collateral attacks on such settlements.

The "where" questioned is informed by the recognition in the Class Action Fairness Act (CAFA) of the difficulties presented by what one might describe charitably as the anomalous court - for CAFA proponents, one inclined to certify a nationwide class action when the vast majority of other courts would not. Most of the class action commentary assumes the original certifying court to be suspect and the subsequent reviewing court to be virtuous. Our contention is that the problem of the anomalous court is not confined to the initial class certification. The same problem of outlier courts can arise when the parties agree to "park" a class settlement for approval and, later, where a class member might mount a collateral attack on its binding effect. In the first instance, we look to see whether the forum for the class action was congressionally mandated or subject to strategic behavior by the parties.

The "what" question calls for a distinction between structural conflicts of interest in the class representation and other defects in the nature of bad deals for some or all of the class members. Only the former kind of defect bespeaks a proceeding illegitimate from its outset in a manner akin to the sorts of "jurisdictional" deficiencies thought to warrant collateral attacks on judgments in ordinary litigation.

The "how" question is one of proper preclusion for class settlements. The term "collateral attack" has been used sloppily to encompass everything from appeal to relief from the judgment to outright circumvention by filing anew in a different jurisdiction. In this section, we disentangle the various forms of procedural challenge to class action settlements and propose that the level of preclusion be conditioned by where the original suit was filed, how the challenge is presented, and what is the basis of the asserted challenge. Greater preclusion against collateral attack should flow from use of the congressionally preferred forum, as delineated by CAFA, as compared to the potentially anomalous court selected simply by settling counsel. The scope of preclusion should correspond, moreover, to the nature of the defect alleged in the class representation. Structural conflicts of interest warrant an approach that asks whether the rendering court considered and rejected the conflict in question, though not necessarily at the behest of the class member now the proponent of a collateral attack. Bad deals, by contrast, warrant an approach that would ask simply whether there was a full and fair opportunity to challenge the fairness of the settlement in the rendering court, in keeping with the broadened approach to standing in that setting in the Supreme Court's 2002 decision in Devlin v. Scardelletti.


December 3, 2007 in Class Actions, Mass Tort Scholarship, Settlement | Permalink | Comments (0) | TrackBack (0)

Widener Law School Symposium on Crimtorts

On February 25, 2008, Widener University School of Law's Harrisburg, Pennsylvania campus is hosting a symposium entitled, Crimtorts.  Speakers include Deans Linda Ammons (Widener), Susan Raeker-Jordan (Widener), and Kenneth Simons (Boston U.); and Professors Martha Chamallas (Ohio State), Michael Dimino (Widener), Mark Geistfeld (NYU), Keith Hylton (Boston U.), Mary Kate Kearney (Widener), Thomas Koenig (Suffolk), Jeffrey O'Connell (Virginia), Christopher Robinette (Widener), Michael Rustad (Suffolk), Sheila Scheuerman (Charleston), Anthony Sebok (Cardozo), Catherine Sharkey (NYU), and Byron Stier (Southwestern).

The conference is being chaired by Professor Christopher Robinette at Widener, Harrisburg, and the Widener Law Journal will be publishing papers.  I'll be serving on the Crimtorts Applications panel.


December 3, 2007 in Conferences, Mass Tort Scholarship | Permalink | Comments (0) | TrackBack (0)

History of U.S. Toy Safety Regulation

Article in the Wall Street Journal -- It Dawned on Adults After WWII: 'You'll Shoot Your Eye Out!', by Cynthia Crossen -- that discusses the history of toy safety regulation in the United States.  Here's an excerpt:

In late 1969, President Nixon signed into law the Toy Safety Act, the first national safety standard for playthings. The act authorized the Department of Health, Education and Welfare to test and ban hazardous toys. A year passed before the department ordered any toys removed from store shelves. On Dec. 22, 1970, it announced a ban on 39 toys, including several archery sets, some squeeze toys with easily removable squeakers, dolls with barely covered pins or wires and some breakable baby rattles.

By 1974, more than 1,500 toys had been banned by the newly established Consumer Product Safety Commission. Among them was a Smokey the Bear tent that was highly flammable; the popular clacker balls -- two plastic balls on a string -- that could shatter when banged together with enough force; several brands of xylophones, whose keys had sharp edges; and a Betsy Wetsy doll partly held together with a straight pin.

Some people thought the regulations were going too far. "I believe the decision as to whether or not Junior ought to be allowed to play with a sharp-eyes Sniffy Dog or a Talkie Tiger whose squeaker is removable is a decision that in a free society ought to be made by a child's parents and not the federal government," wrote a syndicated columnist, John Lofton, in 1973. "Why, pray tell, ban a battery-operated 'Cheerful Daschund No. 256' simply because it has a sharp pointed nose? Should it not be assumed that the average buyer will notice the shape of the nose and decide for himself whether or not it is too dangerously sharp?"

Both the government and the toy industry began to point to parents as part of the problem, charging they weren't always doing their jobs in protecting their children. Not all hazards came from poor design, a federal safety official said. Some came from the consumer's improper selection and use of toys. "Toys can never be designed or regulated with absolute safety," he said.


December 3, 2007 in Lead Paint, Procedure | Permalink | Comments (0) | TrackBack (0)