Monday, August 17, 2009
S. Todd Brown (Buffalo) has posted on SSRN his article, The Private Market for Specious Claims. Here's the abstract:
One of the most curious aspects of the rise of aggregate mass tort litigation is the evolution of private markets for the development, trade, and sale of personal injury claims among attorneys. Much has been written about the economic efficiencies of mass tort litigation, and a far more modest body of scholarship has addressed the manner in which the private market for developing and prosecuting these claims generate these efficiencies. For all of their efficiencies, however, these markets have not developed in a way that makes actual litigation of claims possible, much less efficient. Rather, the efficiencies achieved have consistently promoted building the 'mass' of claims that may be brought, not developing and producing information sufficient to support the presentation and litigation of those claims in anything more than a superficial manner. Thus, even if nontraditional, streamlined adversarial processes might be employed to test the validity of these claims, these markets are ill-suited to provide courts and other participants with access to sufficient information to do so. The evolution of these markets in this manner is no accident. Efficiency is maximized where the parties do only as much as required and no more. And once a body of tort claimants achieves a sufficient mass, the perceived need to provide accurate in-depth information for the claims presented effectively vanishes. Developing efficient mechanisms for developing and communicating this information will provide no additional advantage (the information is not required for the claims to be paid in most cases) and may, in fact, reduce the number of claims that a lawyer may bring under applicable ethical and procedural rules. Ignorance in this case is not only bliss, it is also far more profitable. Moreover, as in other areas of law (such as the trading of specious debt collection claims), the multiple levels of claim acquisition and development in the private mass tort market may be viewed as shielding lawyers and service providers from culpability for filing specious claims, failing to satisfy traditional ethical duties to clients, and ignoring red flags that might otherwise demand additional investigation. The ability to control the flow of information to those affected by a particular action, a universal attribute of these markets, enhances the perceived insulation from liability. Even if this perception is misguided, it may nonetheless alter the participants' risk assessment and encourage the filing of specious claims. This article suggests that the markets for mass personal injury tort claims may be corrected by modest adjustments to party expectations, including the need to present testable information in a timely fashion. Although some commentators have suggested that such requirements will erase the positive efficiencies of mass tort litigation, the evidence in support of this suggestion is, at best, anecdotal and ignores the practical realities of mass tort practice and technological development. In short, insisting upon basic information development and ready availability of that information will necessitate fundamental changes to the private market for tort claims and better align the end goals of those markets with the goals of the tort system.
Saturday, August 15, 2009
Friday, August 14, 2009
Kyle D. Logue (Michigan) has posted to SSRN his article, Coordinating Sanctions in Torts. Here's the abstract:
This Article begins with the canonical law-and-economics account of tort law as a regulatory tool, that is, as a means of giving regulated parties the optimal ex ante incentives to minimize the costs of accidents. Building on this regulatory picture of tort law, the Article asks the question how tort law should coordinate with already existing non-tort systems of regulation. Thus, for example, if a particular activity is already subject to extensive agency-based regulation, regulation that already addresses the negative externalities or other market failures associated with the activity, what regulatory role remains for tort law? Should tort law in such cases be displaced or preempted? The answer is: It depends. Sometimes, even in the presence of overlapping non-tort regulation, there is a regulatory role that tort law can play, sometimes not.
For one example, if the non-tort regulatory standard is already “fully optimizing,” in the sense that the regulatory standard (a) sets both an efficient floor and an efficient ceiling of conduct and (b) is fully enforced by the regulatory authority, then tort law arguably should be fully displaced in the sense that no tort remedy should be available for harms caused by such an activity. If, however, the regulatory standard is only “partially optimizing” (for example, it is only an efficient minimum or efficient floor or it is only partially enforced), then tort law continues to have an important regulatory role to play.
This framework can be used to explain such tort doctrines as negligence per se and suggests circumstances in which there should be a corollary doctrine of non-negligence per se. It also helps to explain recent federal preemption cases involving overlapping tort and regulatory standards. Finally, the framework produces insights for how tort law might efficiently be adjusted to coordinate with overlapping social norms, which are also considered within the L&E tradition to be a form of regulation.
Elizabeth Nowicki (Tulane) has posted to SSRN her article, Apologies and Good Lawyering. Here's the abstract:
In everyday life, apologies are common. For example, if one shopper bumps into another in a crowded grocery store, apologies abound. Or if a child on the playground accidentally crashes into another child, the crashing child will apologize. If the crashing child does not apologize, a teacher, playground monitor, or parent will instruct the child to apologize, because apologizing for hurting someone is the 'right' thing to do. This apology norm largely disappears if the crashing child grows up and becomes a lawyer, however. Despite empirical research showing that apologies have value in settlement, facilitate cost-effective dispute resolution, and are important to injured parties, it appears that lawyers do not regularly either suggest that a client ask for or suggest that a client offer an apology as part of a conflict resolution. Why does the instinct to facilitate dispute resolution with a sincere apology disappear when students enter law school or when law students become lawyers? Some suggest that lawyers – and consequently the clients they advise – disavow apologies as a matter of defense because apologies are viewed as costly admissions of liability. Others suggest that attorneys for injured parties have no obvious incentives to suggest apologies since quick dispute resolution results in smaller legal fees. Still others suggest that those who become lawyers tend to be logical and analytical, and tend to eschew conduct viewed as purely emotive, such as apologizing. This paper shows that a good lawyer must recognize the value of apologies in conflict resolution, litigation, and settlement, and this paper provides guidance for offering apologies.
Professor Eric Engle (Harvard & Universitat Bremen) has posted to SSRN his article, Aristotelian Theory and Causation: The Globalization of Tort Law. Here's the abstract:
Instant global communication and world-wide trade and travel have broken down legal barriers despite historical and linguistic differences in the differing legal systems. The result? A remarkably uniform globalized system of tort law. The common law and civil law of torts reach similar results because they must address and resolve the same basic fact patterns. However, the parallels between the common law and civil law of tort are much greater than mere factual convergence: the same legal theories appear in each system, notably Aristotelian concepts of causation, as well as foreseeability, the adequacy theory, and economic analysis of law. More often than not, even the same basic black-letter rules of tort liability are found in common law and civil law. This contentious conclusion of rule convergence is compelled by an observation of the basic black-letter rules in both systems. Similar fact-patterns and the same basic theories led to the development of strikingly similar rules in both the common law and civilianist tort, even in a field of national law and even in a field where the facts are inevitably indeterminate.
Tort law is the doctrinal (superstructural) expression of material facts, notably the relationships of productive forces - economic actors and actions. The law of tort seeks to rationalize, justify and explain the relations of production. Convergence of tort law is an emergent property of the global legal system, a demonstrable confirmation of a weak version of Gunther Teubner's thesis that law is a self-organizing system and of Volkmar Gessner's thesis that legal certainty is an emergent property of legal systems. Autopoeisis and emergence clearly are characteristics of globalized tort law. Unlike Duncan Kennedy and, I believe, like Teubner, I do not take the position that law is autonomous or even relatively-autonomous to other social sciences or the economic base on which legal superstructures are built. Rather, global convergence of national private law of tort tends to confirm that law (superstructure) and market (base) are in a dialectical relation. However, at least on the issue of emergent legal convergence, the facts do not prove my hypothesis that the economic base determined the legal superstructure even as the legal superstructure at times, exceptionally, decidedly influences the structuring of the economic base - because the economic base and the legal superstructure here both lead to the same outcome - convergence of distinct private law systems.
The code of ethical conduct for lawyers -- the American Bar Association’s Model Rules of Professional Conduct (the “Model Rules”) -- legitimizes a certain amount of dissembling and misdirection in the negotiation realm, only prohibiting legal negotiators from making fraudulent misrepresentations about material matters. To determine if attorneys are meeting this low standard, the authors surveyed practicing lawyers and asked them if they would agree to engage in a fraudulent pre-litigation settlement scheme if a client requested them to do so. Nearly one-third of the respondents indicated they would agree to the client’s overtures, and only half indicated that they would refuse the client’s overtures, thereby following the Model Rules. Follow-up questioning suggested several reasons for these results: there appears to be substantial misunderstanding as to what constitutes a fraudulent misrepresentation, there seems to be considerable confusion surrounding the rule’s operative term “material fact,” and it appears that some of the attorneys believe that other legal rules, including other portions of the Model Rules, either gave them permission or required them to engage in the fraudulent negotiation scheme. To rectify these apparent misunderstandings among practicing lawyers, the article offers three interdependent means for improving lawyer negotiation ethics – rule clarification, education, and increased rule enforcement.
The substance-procedure dichotomy is a popular target of scholarly criticism because procedural law is inherently substantive. This article argues that substantive law is also inherently procedural. I suggest that the construction of substantive law entails assumptions about the procedures that will apply when that substantive law is ultimately enforced. Those procedures are embedded in the substantive law and, if not applied, will lead to over- or under-enforcement of the substantive mandate. Yet the substance-procedure dichotomy encourages us to treat procedural systems as essentially fungible—leading to a problem of mismatches between substantive law and unanticipated procedures. I locate this argument about the procedural foundation of substantive law within a broader discussion of the origin and status of the substance-procedure dichotomy.
Wednesday, August 12, 2009
Professor Patricia W. Hatamyar (Oklahoma City Univ.) has posted on SSRN her article, The Effect of 'Tort Reform' on Tort Case Filings, 43 Valparaiso Univ. L. Rev. (forthcoming 2009). Here's the abstract:
An empirical study of the number and types of different tort cases filed in Oklahoma state courts from 2003 - 2007. While numerous measures of so called 'tort reform' passed the Oklahoma legislature prior to 2003, advocates of 'tort reform' continue to press for more. The study finds that there was a 17.5% decrease in the number of tort clases (claiming over $10,000) filed, from 6,764 such cases in 2003 to 5,576 cases in 2007. During the same time period, the number of all civil cases over $10,000 filed increase 4%. The data suggest that the measures passed before 2003 negatively affected tort case filings, and that future measures may be unwarranted.
Elizabeth Bahr on Foreign Sovereign Immunities Act and Compensation of Military Victims of War on Terror
Elizabeth Bahr of George Mason Law School has posted to SSRN her Comment, Is the Gavel Mightier than the Sword? Fighting Terrorism in American Courts: The Problematic Implications of Using the Foreign Sovereign Immunities Act to Compensate Military Victims of America’s War on Terror, 15 Geo. Mason L. Rev. 1115 (2008). Here's the abstract:
This Comment examines the holding of Rux v. Republic of Sudan in light of other successful judgments under the Foreign Sovereign Immunities Act's (FSIA) Terrorism Exception, with a focused emphasis as to whether it is sound policy and law to allow service-members, or their surviving family members, to recover monetary judgments against foreign states during a time of war. By examining the principles of sovereign immunity as elucidated in both the Federal Tort Claims Act (“FTCA”) and FSIA, this Comment argues that allowing U.S. service-members to recover monetary judgments against foreign states for injuries incurred during war interferes with the constitutionally granted executive powers of the President by frustrating U.S. foreign policy efforts, and significantly undermines the President’s role as Commander in Chief of the U.S. military. Allowing service-members to recover monetary judgments under FSIA’s Terrorism Exception could also have an extremely negative impact on the military itself; permitting the unjustifiable discrimination between the types of recovery different service-members could collect if injured could drastically affect the morale of the very troops the United States is relying on to fight this war on terror.
Jason C. Miller of University of Michigan has posted to SSRN his Note, When and How to Defer to the FDA: Learning from Michigan's Regulatory Compliance Defense, 15 Mich. Telecomm. & Tech. L. Rev. 565 (2009). Here's the abstract:
Should FDA approval of a drug affect products liability litigation? This remains one of the most debated questions in the law. Although the Supreme Court recently held that state tort law is not forced to defer to the FDA's finding that a drug is safe through preemption, states remain free to defer to the FDA by providing a regulatory compliance defense in state substantive law. Michigan made exactly such a choice in enacting the only complete defense for FDA-approved drugs. Compliance with FDA regulations conclusively establishes a lack of products liability under Michigan law. With preemption seemingly off the table after Wyeth v. Levine, advocates of greater deference to the FDA may use Michigan as a model for legislation in other states. Much can be learned from examining Michigan's law.
Michigan's regulatory compliance defense properly recognizes that an FDA-approved drug carrying an FDA-approved label should not be considered defective. However, the statute's absolute immunity provides no compensation for injured parties in any circumstance, including situations where the FDA process has failed to protect consumers. This Note examines the question of FDA approval in state tort actions, discusses Michigan's answer to that question, and offers a proposal that would block most private actions against FDA-approved drugs (as Michigan has done), but would allow a state attorney general to bring suits in certain circumstances. The state attorney general model detailed in this Note stakes out a middle ground in the debate over the significance of FDA approval. The proposal recognizes the primacy of the FDA, but also recognizes the need for a back-up that can provide deterrence and compensation in the few cases that slip through the FDA's regulatory cracks.
Tuesday, August 11, 2009
Am Law Daily's Priti Patnaik writes about the Boles case:
Starting Tuesday, pharma giant Merck & Co., Inc. faces the first trial over its osteoporosis drug Fosamax. More than 900 such lawsuits have been filed by more than 1,200 plaintiffs in state and federal courts. The suits claim that doctors were not warned that the drug may hamper blood flow to the jaw, causing jawbone-tissue death--osteonecrosis of the jaw, or ONJ. In some cases, ONJ leads to partial removal of the jaw.
Plaintiff Shirley Boles, 71, is represented by partner Timothy O'Brien and associates Meghan Tans and Ned McWilliams of Levin, Papantonio, Thomas, Mitchell, Echsner & Proctor. Michelle Parfitt and James Green at Ashcraft & Gerel are also working on the case.
Merck's trial team includes Paul Strain of Venable in Baltimore and Christy Jones of Butler, Snow, O'Mara, Steves & Cannada. Both represented Merck in the marathon Vioxx litigation. The company declined to name the other attorneys working on the case, saying that the information was part of its litigation strategy.
Interestingly, Judge Keenan has ruled that no punitive damages may be sought.
Ted Frank, formerly a fellow at the American Enterprise Institute, has moved into the business of objecting to consumer class action settlements. Here is a link to an interview with him on Above The Law.
So much has been written on objectors to class actions I hardly know where to begin. First there was the thought (espoused by Mr. Frank in the interview) that objectors can protect the class by representing their interests as opposed to the conflicted interests of their lawyers. People were concerned that plaintiff-side class action lawyers would be tempted to sell out the class in order to obtain a bigger or faster fee. Academics wrote about "reverse auctions" where the class counsel would compete to provide defendants with the cheapest settlement in a friendly jurisdiction, in exchange for the lucrative fees. So the idea is that if objectors could be paid for their time and effort in ferreting out settlements that did not benefit the class, then both the system and class members would benefit.
But then came second order problems. If objectors were getting paid, wouldn't they object to good settlements merely to earn a fee? Courts started to crack down on objectors, ordering them to pay substantial penalties if the court found that the objectors were objecting merely to scuttle a good settlement in exchange for some fees of their own -- sometimes called "objector blackmail."
Traditionally, the best objectors have been public interest organizations. Brian Wolfman of Public Citizen did some excellent work objecting to flawed settlements (such as the GM Coupon settlement in the Third Circuit.) That doesn't mean they shouldn't get paid - after all, these organizations need to survive. But judges may feel more comfortable that the money is going to the organization to do more of the same work, rather than to line an individual's pocket.
Monday, August 10, 2009
Anita Bernstein (Brooklyn Law) has recently posted an intriguing article in SSRN entitled "Implied Reverse Preemption." Here is the abstract:
Current preemption law asymmetrically assumes that Congress sometimes intends to preempt tort liability yet never intends to abandon this kind of preemptive design once undertaken. This assumption is inaccurate, as a study of one exemplar - consumer product safety regulation - reveals. Because old inferences of preemption can grow obsolete and inaccurate after Congress has moved in a different direction, the judge-made doctrine of implied preemption calls for a complementary doctrine of implied reverse preemption.
An elegant idea. ADL