April 14, 2012
Comparative Case Valuation: Tobacco Edition
BNA Class Action Litigation Reporter has an article about Engle's progeny and how the Florida courts are dealing with the variation in jury verdicts in those cases. Here the link - behind a pay wall unfortunately.
In sum and substance, the Florida Supreme Court permitted an issue class action regarding the conduct of the tobacco companies to stand and ruled that the results have preclusive effect in subsequent cases. Now the Individual cases are being litigated. There are many plaintiffs verdicts. BNA describes that there have been 50 judgments and compensatory damages were awarded in 35 cases. Of those, in at least 10 the jury awarded more than $7 million. Not all have survived on appeal.
I am interested in this suit because I think issue class actions are the cutting edge of class litigation and because there is potential here to use statistical methods to come up with a solution that is better than spending many millions litigating every case to judgement and appealing it.
Here is the list of verdicts above $7 million:
$8 million compensatory and $71.2 million punitive damages (vacated on appeal) - Webb (No. 1D10-6557, 4/9/12)
$ 8 million compensatory - Tate (No. 2007–CA-021723 (17th Cir. Broward County))
$7.8 million compensatory - Campbell (No. 2008 CA 2147 (1st Cir. Escambia County)) (upheld on appeal).
$10 million compensatory - Cohen (No. 2007–11515 (17th Cir. Broward County)).
$7 million compensatory - Grey (No. 2007–CA-002773 (1st Cir. Escambia County)) (upheld on appeal)
$56.59 million compensatory - Naugle (No. 07–036736CA (17th Cir. Broward County)).
$15 million compensatory - Putney (No. 2007–CV-36668 (17th Cir. Broward County)).
$10.8 million compensatory - Townsend (No. 01–2008–CA-003978 (8th Cir. Alachua County)) (upheld on appeal) (40 million punitive damages award struck down).
$20 million compensatory - Alexander (No. 07–46830–CA-10–4 (11th Cir. Miami-Dade Co.)) (on appeal)
$10 million compensatory and $20 million punitives - Smith (No. 09-719-CA (14 Cir. Jackson County) (on appeal)
Readers who know of others, or have a list of all the verdicts, please let us know. ADL
April 07, 2012
Class Action Blawg on the Case Against "Trial by Formula"
The Class Action Blawg has a post citing useful caselaw against the concept of trial by formula - that is, the use of statistical analysis to determine either apportionment of damages (less controversial) or liability (more controversial). Thanks to our own Sergio Campos for the tip.
I just published a paper on this very topic called The Case for "Trial by Formula." In this defense of the use of statistics, I show the benefits for statistical analysis in mass tort cases for the promotion of equality between plaintiffs. "But what about defendants' due process rights?" the authors over at CAB, Justice Scalia and others might rightly ask. This is a very good question. Take Wal-Mart v. Dukes and the defense argument that the use of statistics to conduct Teamsters hearings would violate the defendants' right to assert individualized affirmative defenses. I wonder whether the defendant would actually be able to marshall the indivdualized proof against each individual plaintiffs' claims as they said they wanted to do. I'd like to see a court call the defendants' bluff in one of these cases and actually see if defendants have enough evidence to exercise their right to assert individualized defenses in at least a sampling of cases -- not to dispose of the whole litigation, but just to inject some realism into the proceedings. There's also a deeper issue - what is due process anyway? Is the touchstone tradition? If so, new developments in statistics and probability theory are useless to the doctrine; due process is really horse and buggy process which requires an individual hearing. Or is it about what process is due from either a participatory, accuracy or other metric? If so, there might indeed be something to talk about.
February 28, 2012
BP Today, Tomorrow and Into the Future
You don't need the Mass Tort Litigation Blog to tell you that the imminent BP trial has been stayed pending settlement talks. In the meantime, here are some thoughts from the ever relevant George Conk. Special shout out for his poetic references: Diving Into the Wreck: BP and Kenneth Feinberg's Gulf.
I was just at a wonderful conference at the Charleston School of Law on Mass Torts and the Federal Courts where Feinberg spoke. One of the key questions at the conference is the extent to which claims facilities (BP, 9/11, etc.) are unique and unlikely to be repeated or the wave of the future. The interesting thing about BP is that it shows the interaction between claims facilities and litigation - its not one or the other. Speakers mentioned how companies trying to get ahead of a litigation may well look to the BP model. Others questioned whether BP was really special because the company was prepared to admit liability (although not gross negligence).
I was especially interested by the remarks of Sheila Birnbaum, currently running the 9/11 Fund for first responders and who mediated settlements for the 94 families who chose not to participate in the 9/11 Victim Compensation Fund. Even the families who wanted a public trial to find out what happened ultimately settled because of the uncertainty of trial. This raises important questions about the purpose of litigation for individuals: is it ultimately to get compensation? How important is it to get to the "truth"? How important is vindication? Punishment? When people settle (or waive their right to litigate prior to filing suit), what kind of consent do we want and does money ultimately satisfy? Lynn Baker, who was at the conference, referred me to the following article that addresses some of these questions: Gillian Hadfield, Framing the Choice Between Cash and the Courthouse: Experiences with the 9/11 Victims Compensation Fund. This continues to be relevant, especially if Funds become a model rather than a one-off.
February 17, 2012
Philly Court Issues New Mass Tort Protocol
Mark Behrens sent me a new mass tort protocol issued by the Philadelphia Court of Common Pleas. Here are some highlights:
- There shall be no reverse bifurcation of any mass tort case, including asbestos, unless agreed upon by all counsel involved.
- Consolidation of mass tort cases shall not occur absent an agreement of all parties, except in the asbestos program in accordance with the protocols set forth herein below.
- All punitive damage claims in mass tort claims shall be deferred.
- Pro hoc vice counsel shall be limited to no more than two (2) trials per year, but otherwise will not be limited on pre-trial appearances. The Court encourages non-Pennsylvania counsel to pass its Bar Examination and thereby become familiar with Pennsylvania law, rules and procedures.
- Unless otherwise agreed by defense counsel or upon showing of exigent circumstances, all discovery shall take place in Philadelphia.
- Except for those cases already scheduled for trial through February 29, 2012, asbestos cases thereafter shall be grouped in groups of a minimum of 8 and a maximum of 10 and counsel shall be required to propose cases for consolidation considering the following criteria:
- Same law. Cases that involve application of the law of different states will not be tried together;
- Same disease. The disease category for each case in a group must be identical. The disease categories of cases to be grouped for trial are mesotheliomas, lung cancers, other cancers and non-malignancy cases;
- Same plaintiff’s law firm. Primary trial counsel for all cases in each group will be from a single plaintiff firm. Cases where Philadelphia plaintiff firms serve as local counsel for out-of-state counsel will not be grouped with cases from the local firm;
- Fair Share Act cases will not be consolidated with non-Fair Share Act cases;
- Pleural mesothelioma is a disease that is distinct from mesotheliomas originating in other parts of the body, and will not be tried on a consolidated basis with non-pleural mesothelioma cases and not necessarily tried on a consolidated basis. Non-pleural mesothelioma cases will be further classified for trial, so that non-pleural mesothelioma cases allegedly caused by occupational exposure will not be tried on a consolidated basis with non-pleural mesothelioma cases allegedly caused by para-occupational (bystander) exposure;
- And such other factors as determined appropriate in weighing whether all parties to the litigation can receive a prompt and just trial. The Court’s present backlog of asbestos cases shall not be an overriding factor in the consolidation determination.
- Any grouping of cases less than 8-10 in number shall not receive a trial date until a group is formed of 8-10 cases. A maximum of 3 of these 8-10 cases may be tried, with the other 5-7 cases either resolving through settlement or returned to the Coordinating Judge for regrouping and relisting for trial.
- Mediation: Once grouped, assigned a trial date and after Motions for Summary Judgment have been decided by the Court, counsel are urged to seek mediation from a special panel of former judges named herein below. Either side may request mediation. The mediator selected by the parties shall advise the Court whether the plaintiff firm’s participation was in good faith or not. In the discretion of the Coordinating Judge, any plaintiff firm’s failure to proceed in good faith in mediation may constitute just cause to remove that group of cases from the trial list and any defendant’s failure to proceed in good faith may result in an increase of the maximum 3 cases consolidated for trial. Since no more than 3 cases may be consolidated and proceed to trial in any group of 8-10, the remaining 5-7 cases should be resolved and settled. Otherwise, those unresolved cases shall be relisted for trial. All parties will share the expense of mediation.
11. Immediately prior to trial of up to 3 consolidated asbestos cases, the assigned trial judge shall independently determine whether the cases will be tried in a consolidated manner based on the criteria herein above set forth and any other factors deemed relevant to the issue of consolidation and a fair trial.
12. Expediting of Cases. There shall be no expediting of cases based on exigent medical or financial reasons until the backlog of pending cases has been resolved, unless otherwise agreed by a majority of the defendants. When this Program achieves 80% of all asbestos cases resolved in 24-25 months, advanced listings based on exigent medical circumstances will be considered for plaintiffs with Pennsylvania exposure only.
February 02, 2012
Honda Loses Small Claims Court Suit Over Hybrid Fuel Economy, Raising Questions About Alternatives to Class Actions
As the L.A. Times reports, Honda has lost a case filed in small claims court in California by a Civic hybrid owner who claims her Honda misrepresented the gas mileage possible. The owner apparently opted out of a proposed class action settlement that might provide $100 and new-car rebate coupons to Civic owners, and pay class counsel $8.5 million in attorneys fees. Instead, she filed in small claims court and after 3 hours of testimony over two days, she was awarded $9,867.19 in damages. (In California small claims courts, parties must appear without separate counsel; plaintiff here was an attorney representing herself, though her bar membership is apparently inactive.) Honda, however, plans to appeal the small claims award to Los Angeles County District Court. (H/t to my Mass Tort Litigation student Michelle Rosenberg, who sent me the story.)
Might small claims court be a viable alternative to class action litigation? Class actions of course are most appropriate in so-called negative value claims, where the cost of bringing individual suit exceeds the recovery sought. Small claims court, with its radically diminished transaction costs (and no attorneys' fees), could be seen to shrink the realm of negative value claims. And smalls claims court avoids the potential conflict of interest arising from the temptation for class counsel to settle class claims for a less than optimal amount, in pursuit of a hefty, sure, and speedy class counsel fee. Small claims court still wouldn't be worth the trouble of people who think they were defrauded only a dollar or two, but it might be a viable alternative if hundreds of dollars per claimant were at stake.
January 30, 2012
More on the Second Circuit's Refusal to Block Enforcement of Ecuadoran Judgment
January 29, 2012
PIP Breast Implants and Mass Torts in Europe
According to this article from CNN, French authorities have arrested Jean-Claude Mas, the founder of Poly Implant Protheses (PIP), in connection with alleged manslaughter and involuntary harm to a woman who died from cancer and had PIP breast implants. The article notes that 300,000 women in 65 countries received PIP breast implants, and that questions have been raised about the use of non-medical-grade silicon and PIP went bankrupt in late 2010.
The PIP breast-implants controversy may present an opportunity to observe non-U.S.-style mechanisms for what here would likely have been a mass tort litigation. Since the PIP breast implants were not permitted to be sold in the U.S., litigation may be concentrated abroad. In general, my sense is that the European approach is more reliant on criminal law than tort for deterrence, compensatory damages are limited because of the comparatively extensive governmental social insurance, punitive damages are unavailable, and class actions are traditionally not embraced (though class actions appear to be on the rise globally -- see, e.g., the Stanford Global Class Actions Exchange).
Interestingly, according to the article, one French woman who received PIP breast implants said, "Too bad we do not have a justice system like they do in the United States which allows the accumulation of penalties...because the small punishment he will receive for what he did to 300,000 to 400,000 women, is not much compared to what we have suffered because of him."
(H/t to my Mass Tort Litigation student Abigail Anderson for sending me the CNN story.)
January 24, 2012
Engle's Progeny Go to the Supreme Court
The litigation that arose of out the Engle class action ruling (Engle v. Ligett Group, 945 So.2d 1245 (Fla. 2006) might be coming to the Supreme Court. As mentioned in my previous post, petitions for cert have been filed by Philip Morris and others. In Engle the Florida Supreme Court held that the factual findings reached in an issue class class action can preclude the tobacco company from raising certain issues in subsequent litigation against class members. Now the individual cases that were part of that class action are being litigated and Philip Morris claims that the use of issue preclusion here violates their due process rights.
So far there is a petition for cert (2011 WL 6330473), Brief of the Product Liability Advisory Council, Inc. as Amicus Curiae in Support of Petitioners (2012 WL 135308), Brief of The Chamber of Commerce of The United States of America as Amicus Curiae in Support of Petitioners (2012 WL 167004) and Brief of Professors Aaron Twerski and James A. Henderson Jr. as Amici Curiae in Support of Petitioners (2012 WL 167005).
January 20, 2012
California Lawsuit Reform and the Need for Court Funding
Tom Scott, the Executive Director of California Citizens Against Lawsuit Abuse, has posted on Fox&Hounds a 2012 wishlist for legal reform. While there are many proposed reforms helpful to business, I was struck by one not usually associated with business desires or law reform:
6. Stop cutting the funding of the California courts. Our court system is still reeling from cuts last year, and more cuts would only reduce access to the courts even more.
I am heartened to see that even those who are "fighting against lawsuit abuse" understand that adequate court funding is essential if suits are to be promptly adjudicated -- and found either meritorious and tried, or found unmeritorious and dismissed. Both pro-plaintiff and pro-business groups should be able to come together to advocate for court funding in a time of shrinking governmental budgets. And those who practice in mass tort litigation should be especially vocal, in light of the heavy demands such litigation places on state and federal courts. Moreover, as the election season approaches and disagreements multiply across the political spectrum, liberals and conservatives might remind themselves that they agree on government's core responsibility in providing a functioning court system for dispute resolution.
January 16, 2012
Southwestern Law School Symposium on Transnational Litigation and Civil Procedure
Below is the announcement from Southwestern Law School, and here is the brochure.
Southwestern Journal of International Law presents
Friday, February 3, 2012, 9:00 a.m. – 5:15 p.m.
Southwestern Law School, Los Angeles, California
Panelists include (in alphabetical order):
· Samuel P. Baumgartner, Professor of Law, University of Akron School of Law
· Vaughan Black, Professor of Law, Dalhousie University Schulich School of Law
· Gary B. Born, Partner, WilmerHale, Lecturer on Law, Harvard Law School
· Stephen B. Burbank, David Berger Professor for the Administration of Justice, University of Pennsylvania Law School
· Montré D. Carodine, Associate Professor of Law, University of Alabama School of Law
· Donald Earl Childress III, Associate Professor of Law, Pepperdine University School of Law
· Paul R. Dubinsky, Associate Professor of Law, Wayne State University Law School
· Allan Ides, Christopher N. May Professor of Law, Loyola Law School, Los Angeles
· Thomas Orin Main, Professor of Law, University of the Pacific, McGeorge School of Law
· Erin O’Hara O’Connor, Professor of Law and Director of Graduate Studies, Law & Economics PhD Program, Vanderbilt Law School
· Cassandra Burke Robertson, Associate Professor, Case Western Reserve University School of Law
· Linda J. Silberman, Martin Lipton Professor of Law, New York University School of Law
· Linda Sandstrom Simard, Professor of Law, Suffolk University Law School
· Adam N. Steinman, Professor of Law and Michael J. Zimmer Fellow, Seton Hall University School of Law
· Janet Walker, Professor of Law, Osgoode Hall Law School
· Rhonda Wasserman, Professor of Law, University of Pittsburgh School of Law
· William E. Thomson, Partners, Gibson, Dunn & Crutcher LLP
· James H. Broderick, Jr., Partner, Squire, Sanders & Dempsey LLP
· Marcus S. Quintanilla, Counsel, O’Melveny & Myers LLP
· Ray D. Weston Jr., Vice President and General Counsel, Taco Bell Corp.
January 14, 2012
BP, the Gulf Coast Claims Fund, and MDL Plaintiffs' Lawyers
All that in the recent interesting op-ed from New York Times business columnist Joe Nocera -- BP Makes Amends.
November 30, 2011
Vanderbilt Law Review Symposium on the BP Oil Spill
You can access the article from their website: www.vanderbiltlawreview.org
Or read a summary of the pieces on Concurring Opinions.
November 27, 2011
Fifth Annual Conference on the Globalization of Class Actions and Mass Litigation at The Hague
The Fifth Annual Conference on the Globalization of Class Actions and Mass Litigation is being hosted by Tilburg University and will be held on December 8-9, 2011 in The Hague, Netherlands. The conference is being organized by Professors Deborah Hensler (Stanford Law School), Christopher Hodges (Oxford Centre for Socio-Legal Studies and Erasmus University), and Ianika Tzankova (Tilburg University). Master claim administrator Kenneth Feinberg is delivering the keynote speech.
October 20, 2011
Levaquin Bellwether Trials Update
BNA reports that a set of cases (one trial, two plaintiffs) reached a defense verdict in the Levaquin pharma litigation. Beare v. Johnson & Johnson, N.J. Super. Ct. Law Div., No. ATL-L-196-10, verdict 10/14/11; Gaffney v. Johnson & Johnson, N.J. Super. Ct. Law Div., No. ATL-L-4551-09, verdict 10/14/11). The cases are consolidated before Judge Carol Higbee of New Jersey, who also oversaw the New Jersey Vioxx litigation.
The allegations are the the manufacturer of the antibiotic did not provide adequate warnings of its potential to cause tendon injuries. There are six more bellwether cases to go. According to BNA there are approximately 1,900 Levaquin cases before Judge Higbee.
I don't have information about how the bellwether cases were picked or why eight is the number. For an analysis of how judges can do a more rigorous job of using bellwether trials to promote case resolution and equality among litigants, see my latest paper: The Case for "Trial by Formula."
October 10, 2011
Update on Bellwether Trials in Toyota Acceleration Cases
Today's Wall Street Journal Law Blog has an update on the state and federal Toyota acceleration cases. California Superior Court Judge Anthony Mohr has penciled in bellwether trials to begin in April of 2012, but Judge Selna, who is presiding over the federal MDL, estimates that bellwether trials will not begin there until February 2013. Likewise, plaintiffs' attorneys litigating before Judge Robert Schaffer in Texas suspect that they too will not try a case until 2013.
October 02, 2011
All or Nothing Aggregate Settlements in Trouble
(With apologies to HME for stealing his title)
The Second Circuit last week (just in time for the Jewish New Year) decided Johnsons v. Nextel Communications, Inc., -- F.3d -- , 2011 WL 4436263 (2d Cir. Sept. 26, 2011) . You can find the opinion here. That case involved an aggregate settlement with all kinds of schenanigans that our own Howard Erichson described in his article "The Trouble With All or Nothing Settlements." (download it while its hot! ...as they say....)
The Second Circuit allowed the clients to sue the lawyers on a broad breach of fiduciary duty theory. The clients may also sue the defendants on an "aiding and abetting" theory.
I learned from this opinion from Adam Zimmerman (St. John's) who has also blogged about it on the ADR Prof Blog.
September 22, 2011
Sending Mass Torts to State Court
I just read a very interesting student note from 1987 suggesting that in mass tort cases the JPMDL should be permitted to send mass tort cases to state court. George T. Conway III,* The Consolidation of Multistate Litigation in State Courts, 96 Yale L. J. 1099, 1101 (1987). The rule of thumb could be that the state with the applicable law would be the target jurisdiction. Of course this would take new Congressional action to implement, but what an idea!
*The author is now a litigation partner at Wachtell - I wonder what he would say of his student note with many years of experience under his belt? If you're reading this, leave a comment or drop me an email.
September 19, 2011
Oil Spill Trial To Begin
District Court Judge Carl Barbier (EDLa) has issued a case managment order for the upcoming trial arising out of the BP Horizon Deep Water Oil Spill. You can find the order here: Pretrial Order #41. According to BNA, the MDL has more than 500 lawsuits arising out of the spill.
August 29, 2011
Grabill on Judicial Review of Private Mass Tort Settlements
Jeremy Grabill (Weill, Gotshall) has posted to SSRN his article, Judicial Review of Private Mass Tort Settlements, which is forthcoming in the Seton Hall Law Review. Here's the abstract:
In the mass tort context, class action settlements have largely given way to a unique form of non-class aggregate settlements that this Article refers to as “private mass tort settlements.” Although it has been argued that aggregation in tort law is “inevitable,” the legal profession has struggled for many years to find an effective aggregate settlement mechanism for mass tort litigation that does not run afoul of the “historic tradition” that everyone should have their own day in court, assuming they want it. Over the last decade, however, as a result of the evolution of non-class aggregate settlements, a new opt-in paradigm for mass tort settlements has emerged that is true to that historic tradition. This Article discusses the new opt-in paradigm and the appropriate contours of judicial authority vis-à-vis private mass tort settlements.
Private mass tort settlements present a difficult conundrum for presiding judges. On one hand, mass tort litigation requires active judicial involvement and oversight due to the sheer size and complexity of such matters. Thus, having been intimately involved in the litigation from its inception, it understandably seems natural for courts to want to exercise some degree of control over private mass tort settlements. But, on the other hand, like traditional one-on-one settlements and unlike class action settlements and other specific settlements, private mass tort settlements do not impact the rights of absent or unrepresented parties. Perhaps not surprisingly then, courts have struggled in applying established principles concerning the scope of judicial authority to evaluate and oversee the implementation of traditional settlements in the unfamiliar context of private mass tort settlements.
This Article seeks to provide a clear path forward by first examining the limited contexts in which courts have the authority to evaluate and oversee the implementation of traditional settlements, highlighting the nature of the absent or unrepresented interests that judicial review is designed to protect in those traditional contexts. The Article then discusses the emerging opt-in paradigm for mass tort settlements and traces the paradigm’s lineage to three recent cases: In re Baycol Products Liability Litigation, In re Vioxx Products Liability Litigation, and In re World Trade Center Disaster Site Litigation. The Article argues that the well-established maxim that courts lack authority over private one-on-one settlements should apply with equal force to private mass tort settlements because these non-class aggregate settlements allow each individual plaintiff to decide whether or not to settle on the terms offered and do not impact the rights of absent or unrepresented parties. In short, courts do not have - and do not need - the authority to review private mass tort settlements. The Article concludes by addressing the arguments that have been advanced to support judicial review of non-class aggregate settlements, debunking the “quasi-class action” theory that some courts have relied upon to regulate attorneys’ fees in connection with mass tort settlements, and discussing the various ways in which courts may nevertheless be able to influence private mass tort settlements.
August 25, 2011
RAND Reports on Asbestos Bankruptcy Trusts and Tort Compensation
RAND's Institute for Civil Justice last week released its report, Asbestos Bankruptcy Trusts and Tort Compensation, by Lloyd Dixon and Geoffrey McGovern. Here's the summary:
Payments by asbestos bankruptcy trusts have played an increasingly important role in compensating asbestos injuries and have become a matter of contention between plaintiff and defense attorneys. At issue is how tort cases take into consideration compensation paid by trusts and the evidence submitted in trust claim forms. This monograph examines how such evidence and compensation are addressed by state laws and considered during court proceedings. It also examines how the establishment of the trusts potentially affects plaintiff compensation from trusts and the tort system combined, payments by defendants that remain solvent, and the compensation available to future, as compared to current, plaintiffs. The authors find that the potential effects of trusts' replacement of once-solvent defendants are very different in states with joint-and-several liability than in states with several liability. In states with joint-and-several liability, total plaintiff compensation should not change. In several-liability states, the replacement of once-solvent defendants by trusts can cause total plaintiff compensation to increase, decrease, or remain unchanged. The findings underscore the importance of information on plaintiff exposure to the products and practices of the bankrupt firms in determining the trusts' effects on plaintiff compensation and on payments by defendants that remain solvent.
RAND also published the shorter Research Brief, Bankruptcy Trusts, Asbestos Compensation, and the Courts, by the same authors.