Sunday, March 4, 2012

More Information on the BP Settlement

As I've been sifting through news report on the BP class action settlement, I've noticed that it's hard to find information on the actual settlement terms.  From what reporters are describing, it sounds like the parties are requesting that Judge Barbier certify two Rule 23(b)(3) classes.  The most comprehensive information comes from the BP Press release.  Here are a few of the most notable passages on the settlement's terms and conditions:

The proposed settlement is comprised of two separate agreements, one to resolve economic loss claims and another to resolve medical claims. Each proposed agreement provides that class members would be compensated for their claims on a claims-made basis, according to agreed compensation protocols in separate court-supervised claims processes. The proposed agreement to resolve economic loss claims includes the financial commitment for the Gulf seafood industry and a fund to support continued advertising that promotes Gulf Coast tourism. 

The proposed agreement to resolve medical claims involves payments based on a matrix for certain currently manifested physical conditions, as well as a 21-year medical consultation program for qualifying class members. It also provides that class members claiming later-manifested physical conditions may pursue their claims through a mediation/litigation process. Consistent with its commitment to the Gulf, BP would also provide $105 million to improve the availability, scope and quality of healthcare in Gulf communities. This healthcare outreach program would be available to all individuals in those communities, regardless of whether they are class members. It would include expanding capacity to address community health needs, including primary care, mental health services and access to environmental health specialists, as well as enhanced training and education related to Gulf Coast health issues.

Under the proposed settlement, class members would release and dismiss their claims against BP. The proposed settlement is not an admission of liability by BP. 

The proposed settlement also provides that, to the extent permitted by law, BP will assign to the PSC certain of its claims, rights and recoveries against Transocean and Halliburton for damages not recoverable from BP. 

The proposed settlement is subject to reaching definitive and fully-documented agreements within 45 days, and if those agreements are not reached, either party has the right to terminate the proposed settlement. Once there are definitive and fully-documented agreements, BP and the PSC would then seek the Court’s preliminary approval of the settlement. Under federal law, there is an established procedure for determining the fairness, reasonableness and adequacy of class action settlements. Pursuant to this procedure, and subject to the Court granting preliminary approval of both agreements, there would be extensive outreach to the public, including through advertisements and direct mail, to explain the settlement agreements, class members’ rights, including the right to “opt out” of the classes, and the processes for making claims. The Court would then conduct fairness hearings at which class members and various other parties would have an opportunity to be heard and present evidence. The Court would then decide whether or not to approve each proposed settlement agreement.
The proposed economic loss settlement provides for a transition from the Gulf Coast Claims Facility (GCCF) administered by Kenneth Feinberg. "Ken Feinberg has overseen the GCCF since it began operating in August 2010, and we thank him and his team for their dedication and professionalism," said Mr. Dudley. "During Mr. Feinberg's tenure, BP has paid approximately $6.1 billion to resolve more than 220,000 claims from individuals and businesses through the GCCF." 

A court-supervised transitional claims process for economic loss claims will be in operation while the infrastructure for the new settlement claims process is put in place. During this transitional period, the processing of claims that have been submitted to the GCCF will continue, and new claimants may submit their claims. 

Payments in class action settlements typically are not made until after final approval of a settlement, but BP has agreed not to wait for final approval of the economic loss settlement before claims are paid. The economic loss claims process will continue under court supervision before final approval of the settlement, first under the transitional claims process, and then through the settlement claims process established by the proposed economic loss agreement.

ECB

March 4, 2012 in Current Affairs, Environmental Torts | Permalink | Comments (1) | TrackBack (0)

Friday, 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.

BGS 

January 20, 2012 in Aggregate Litigation Procedures, Class Actions, Current Affairs, Procedure, Regulation | Permalink | Comments (0) | TrackBack (0)

Tuesday, December 13, 2011

Financiers as Monitors in Nonclass Aggregation

I recently posted a working draft of a new piece titled "Financiers as Monitors: Unbundling Agency, Risk, and Reward in Aggregate Litigation" on SSRN.  The thurst of the piece is that courts will certify fewer and fewer class actions after Wal-Mart Stores, Inc. v. Dukes and AT&T Mobility v. Concepcion.  When cases are economically viable en masse, they're likely to proceed as mass torts currently do, as nonclass aggregation (think Vioxx).  This means that the ethically questionable practices in mass tort litigation (i.e., threatening to withdraw from representing clients who refuse to accept a proposed settlement offer) will invade protypical class action areas like employment discrimination, civil rights, and toxic torts.  

The basic gist of the proposal is that third-party funders could perform a monitoring function in large-scale nonclass litigation and that by unbundling the attorney's role as a financier from that as an advisor, she could be a more faithful agent.  Financiers would contract with plaintiffs for a portion of the litigation's proceeds on a nonrecourse basis.  They'd then negotiate the fee arrangement with the plaintiffs' attorneys, preferably on a billable hour rate (plus, perhaps some small percentage of the proceeds as a successful litigation bonus).  My hope is that this would both reduce the need for monitoring by alleviating the financial tension that a contingent-fee relationship injects and create a viable monitor in the financier. 

Here's the SSRN abstract:

This Article offers a new way to monitor large-scale litigation that proceeds outside the bounds of Rule 23. Although class actions receive all the scholarly attention (and public scorn), after the Supreme Court’s decision in Wal-Mart Stores, Inc. v. Dukes, the class action’s existence is limited, at best. The shadowy world of nonclass aggregation, where attorneys threaten to pull the rug out from under their own clients if they refuse to accept a settlement, will take its place. Despite the attorney overreaching and questionable ethics that have emerged as attorneys scramble to patch together the finality that class certification once afforded, there is no substitute for the judicial monitoring that Rule 23 provided. In short, the nebulous world of mass-tort litigation will become the new operating model for all types of would-be class actions — from employment-discrimination claims to civil-rights litigation to toxic torts.

The answer to this conundrum comes from an equally controversial source: alternative litigation financing. You see, litigating massive cases can take a small fortune, which is fronted by the contingent-fee attorney. And it is the prospect of complete financial ruin that drives plaintiffs’ attorneys to act unethically and coerce clients into settling. Thus, if a third party bore the financial risk, the attorney could be a faithful agent again. But alternative litigation financing, where hedge funds and venture capitals invest in and profit from litigation, raises plenty of ethical issues on its own and has its own cadre of critics. Although wedding the two is bound to spark fireworks, this Article seeks to carefully engineer their union such that it benefits society as a whole and plaintiffs in particular.

This draft is still in its very early stages, so I'd certainly welcome any thoughts or comments on it (eburch[at]uga.edu).

ECB

December 13, 2011 in Class Actions, Current Affairs, Informal Aggregation, Mass Tort Scholarship | Permalink | Comments (0) | TrackBack (0)

Monday, December 5, 2011

Fight Ensures over Attorneys' Fees in BP Oil Spill MDL

Yesterday's NY Times had an article by John Schwartz titled, "Plaintiffs' Lawyers in a Bitter Dispute Over Fees in Gulf Oil Spill Cases."  The article chronicles the now typical battle over attorneys' fees in multidistrict litigation where judges compensate Plaintiffs' Steering Committee members from other attorneys' fee awards.  This dispute is particularly bitter; the steering committee is asking for fees not just from those involved in the federal multidistrict litigation, but from those who negotiated their own recoveries from the privately administered Gulf Coast Claims Facility.

ECB

December 5, 2011 in Current Affairs, Environmental Torts, Ethics, Lawyers | Permalink | Comments (0) | TrackBack (0)

Thursday, September 29, 2011

"Hot Coffee" Film Director and Producer Susan Saladoff at Southwestern Law School

On this Monday, October 3, Susan Saladoff, the Director and Producer of the HBO film, Hot Coffee: Is Justice Being Served?, will speak at Southwestern Law School in Los Angeles, as part of Southwestern's Treusch Public Service Lecture Series.  Prominent plaintiffs' attorney and Southwestern alum Brian Panish will also offer commentary.  The film will be shown at 6:00 p.m., followed by the presentations at 7:30 p.m. and a reception afterwards.  The event is free, but parking is $8.  Space is limited, and an RSVP is necessary to attend; RSVP to deansoffice@swlaw.edu or 213-738-6710.  Here is the flyer, and here is additional information about the event and lecture series.

BGS

September 29, 2011 in Current Affairs, Food and Drink, Products Liability | Permalink | Comments (0) | TrackBack (0)

Tuesday, August 30, 2011

Class Action Symposium at SCOTUSblog

SCOTUSblog is hosting an online symposium about the future of class action lawsuits in the wake of Concepcion and Dukes that will include the following contributors:

  • Sergio Campos, University of Miami School of Law
  • Sarah Crawford, National Partnership for Women and Families
  • Scott Dodson, William & Mary Law School
  • Allen Erbsen, University of Minnesota Law School
  • Ted Frank, Center for Class Action Fairness, LLC
  • J. Russell Jackson, Skadden, Arps, Slate, Meagher & Flom LLP
  • Paul Karlsgodt, Baker Hostetler
  • Charles Silver, University of Texas Law School
  • Andrew J. Trask, McGuire Woods

ECB

August 30, 2011 in Class Actions, Conferences, Current Affairs | Permalink | Comments (0) | TrackBack (0)

Tuesday, August 23, 2011

Politics, Media, and Lawsuit Reform -- The Perry Push for Loser Pays

Since my earlier post on loser pays as a solution to frivolous lawsuits, attention to loser pays as lawsuit reform has increased, apparently largely as a result of Texas Governor Rick Perry's announcement that he is seeking the Republican nomination for President.  Recall that Governor Perry in May enacted a form of loser pays in Texas.  (See also this July speech by Perry discussing passage of loser pays in Texas.)  Then, in August, when Governor Perry announced his candidacy for President, he included in his speech a reference to loser pays, eliciting a surprisingly large cheer from the crowd (see this video at 25 seconds).  Governor Perry's presidential-campaign website then again highlighted lawsuit reform (and thereby also his loser-pays approach) by claiming that "Texas' unmatched record on job creation was based on a few simple ideas: Don't spend all the money.  Keep taxes low.  Make regulations fair and predictable. And stop the frivolous lawsuits that paralyze job creators."  (Emphasis added.)

In response, the media and policy groups have turned their attention to loser pays.  The Washington Examiner several days ago ran an editorial entitled, Lawsuit Reform Could be Big in 2012, which discussed the passage of loser pays in Texas.  The Wall Street Journal Editorial Report on Fox News last weekend highlighted Perry's record on loser pays in Texas, calling it a "major, major reform."  The Institute for Legal Reform of the U.S. Chamber of Commerce yesterday sent out an email blast linking a survey that asked if lawsuit reform should be part of a pro-growth agenda.  And yesterday, Politico published a lengthy analysis of plaintiffs' lawyers preparing to organize politically against Governor Perry, should he be the Republican nominee, because of Perry's record on Texas tort reform: "Among litigators, there is no presidential candidate who inspires the same level of hatred — and fear — as Perry, an avowed opponent of the plaintiffs’ bar who has presided over several rounds of tort reform as governor."

What might Governor Perry do on loser-pays lawsuit reform were he to become President Perry?  Perry is an avowed defender of federalism, so one would think he would not attempt to push loser pays in areas traditionally under state law (such as tort law).  But he might attempt to insert loser-pays provisions in federal statutes creating causes of action.  And as candidate, nominee, or president, he could significantly influence the debate in statehouses about loser pays by continuing to cite loser pays and lawsuit reform as a reason for his claimed relative success of the Texas economy in creating jobs.  Stay tuned.

BGS 

August 23, 2011 in Current Affairs, Lawyers, Procedure | Permalink | Comments (0) | TrackBack (0)

Thursday, June 9, 2011

BP Oil Spill Appeals Judges Appointed

The Gulf Coast Claims Facility has appointed twenty-five people to serve as appeals judges for BP's private compensation system.  Alabama's Press Register describes the process as follows:

Anyone who files a claim valued at more than $250,000 can protest the claims operation’s initial ruling to the appeals panel. BP can protest the decision on any claim above $500,000.

The judges will serve in panels of three. The panels will have 14 days to rule on each case before them.

If claimants are not happy with the appeals ruling, they can file their claim with the U.S. Coast Guard, or sue BP and other companies involved in the spill.

Jack Weiss, LSU's law school dean selected the following people to serve on the panel:

  • Judge Delores R. Boyd (ret.) of Montgomery, Alabama. Boyd is a former Magistrate Judge of the United States District Court for the Middle District of Alabama.
  • Dean John L. Carroll of Birmingham, Alabama. Carroll is the Dean and Ethel P. Malugen Professor of Law at the Cumberland School of Law of Samford University and a former Magistrate Judge of the United States District Court for the Middle District of Alabama.
  • Judge William R. Gordon (ret.) of Montgomery, Alabama. Gordon is a former Circuit Judge of the 15th Judicial Circuit Court of Alabama.
  • Justice Champ Lyons, Jr. (ret.) of Point Clear, Alabama. Lyons is a former Associate Justice of the Supreme Court of Alabama.
  • Judge Edward B. McDermott (ret.) of Dauphin Island, Alabama. McDermott is a former Circuit Judge of the 13th Judicial Circuit Court of Alabama.
  • Judge Kenneth O. Simon (ret.) of Birmingham, Alabama. Simon is a former Circuit Judge of the 10th Judicial Circuit Court of Alabama.
  • Professor Charles W. Ehrhardt of Tallahassee, Florida. Ehrhardt is the Ladd Professor Emeritus at Florida State University College of Law.
  • J. Joaquin Fraxedas of Altamonte Springs, Florida. Fraxedas is an attorney mediator/arbitrator and a Distinguished Fellow of the American College of Civil Trial Mediators.
  • Judge Melvia B. Green (ret.) of Tampa, Florida. Green is a former Judge of the 3rd District Court of Appeal of Florida.
  • Justice Major B. Harding (ret.) of Tallahassee, Florida. Harding is a former Chief Justice of the Supreme Court of Florida.
  • Judge John J. Upchurch (ret.) of Ormond Beach, Florida. Upchurch is a former Chief Judge of the 7th Judicial Circuit Court of Florida and was appointed by the Supreme Court of Florida as a charter member of the Supreme Court Committee on Mediation and Arbitration.
  • Dean Donald J. Weidner of Tallahassee, Florida. Weidner is the Dean and Alumni Centennial Professor at Florida State University College of Law.
  • Judge Gerald T. Wetherington (ret.) of Coral Gables, Florida. Wetherington is a former Chief Judge of the 11th Judicial Circuit Court of Florida and has served as a Judge Pro Tempore of the 2nd and 4th District Courts of Appeal of Florida.
  • Judge Robert J. Burns, Sr. (ret.) of Metairie, Louisiana. Burns is a former Chief Judge of the 24th Judicial District Court of Louisiana and served as a Judge Pro Tempore of the 5th Circuit Court of Appeal.
  • Judge Philip C. Ciaccio (ret.) of New Orleans, Louisiana. Ciaccio is a former Judge of the Louisiana 4th Circuit Court of Appeal and has served as a Justice Ad Hoc of the Supreme Court of Louisiana.
  • Judge David S. Gorbaty (ret.) of Chalmette, Louisiana. Gorbaty is a former Judge of the Louisiana 4th Circuit Court of Appeal.
  • Chancellor Freddie Pitcher, Jr. of Baton Rouge, Louisiana. Pitcher is the Chancellor and Professor of Law at the Southern University Law Center and a former Judge of the Louisiana 1st Circuit Court of Appeal.
  • Professor Ronald J. Scalise, Jr. of New Orleans, Louisiana. Scalise is the A.D. Freeman Associate Professor of Civil Law at Tulane Law School.
  • Lynne R. Stern of New Orleans, Louisiana. Stern is an attorney mediator/arbitrator and past Chairman of the Alternative Dispute Resolution Section of the Louisiana State Bar Association.
  • Professor Guthrie T. Abbott of Oxford, Mississippi. Abbott is a Professor Emeritus of Law at the University of Mississippi School of Law.
  • Professor Patricia W. Bennett of Madison, Mississippi. Bennett is a Professor of Law at Mississippi College School of Law.
  • Richard T. Bennett of Clinton, Mississippi. Bennett is an attorney mediator/arbitrator, former President of the Mississippi State Bar and serves on the Board of Directors of the American Arbitration Association.
  • Judge W. Raymond Hunter (ret.) of Gulfport, Mississippi. Hunter is an attorney mediator/arbitrator, a former Municipal Court Judge for the City of Long Beach and serves as President of the Mississippi Chapter of Attorney-Mediators.
  • Harold D. Miller, Jr. of Madison, Mississippi. Miller is an attorney mediator/arbitrator and served as the first Chairman of the Alternative Dispute Resolution Section of the Mississippi State Bar.
  • Anne P. Veazey of Ridgeland, Mississippi. Veazey is an attorney mediator/arbitrator and serves on the Executive Committee of the Mississippi State Bar Alternative Dispute Resolution Section

ECB

June 9, 2011 in Aggregate Litigation Procedures, Current Affairs, Environmental Torts, Mass Disasters, Procedure | Permalink | Comments (0) | TrackBack (0)

Wednesday, April 20, 2011

The Japanese Liability System & Mass Disasters

I just saw a summary of a talk at Columbia Law School by Curtis Milhaupt, an expert on Japanese Law.  Here's what he says about liability for Tokyo Electric Power Co. (TEPCO):

Japanese law provides for strict and unlimited liability for a nuclear plant operator except for damages caused by a “grave natural disaster of exceptional character, which Milhaupt said would seem to apply here.
 
“To an American lawyer, if this doesn’t constitute a grave natural disaster, I don’t know what would,” said Milhaupt, an expert on Japanese law. “But very interestingly, several government officials came out shortly after the accident and said this exception does not apply.”
 
Even if Tepco were to claim the exception did apply, Milhaupt said that could create problems for the company. “The public anger at Tepco is so great that this may be a pyrrhic victory.”
 
Milhaupt, the Parker Professor of Comparative Corporate Law and Fuyo Professor of Japanese Law, said that suits may also be brought under Japanese corporate and securities laws. “One could imagine suits brought against Tepco by investors for misleading disclosure with respect to its crisis management systems,” said Milhaupt. He added that Tepco’s board of directors might also be sued for ignoring signs that its disaster prevention systems were woefully inadequate.

This could drive TEPCO into bankruptcy, but it won't because TEPCO is too big to fail. Milhaupt says

“Bankruptcy for Tepco is extremely unlikely. It’s too important a company for Japan and the impact on the other power companies would be too great,” Milhaupt said. “Whether through nationalization, or through capital injections, the bottom line is the Japanese government will have to support Tepco for years to come.”
ADL

April 20, 2011 in Current Affairs, Environmental Torts, Mass Disasters | Permalink | Comments (0) | TrackBack (0)

Tuesday, April 19, 2011

The New, New Opt-Out

As all class-action enthusiasts know, neither plaintiffs lawyers nor defendants like for class members to exercise their opt-out rights.  Opting out from the plaintiffs' attorneys' perspective diminishes their fee award and undermines their ability to deliver total peace to the defendant; the defendant wants finality and closure, which opt outs undermine.  So, lawyers developed mechanisms to thwart class members from opting out, such as including walk-away provisions, liens on the defendants' assets in favor of those remaining in the class, and most-favored-nation provisions in the settlement.

Recently, attorneys have begun settling mass-tort cases outside of the class-action process.  (As most of you know, CAFA makes it increasingly difficult to certify mass-tort cases as Rule 23(b)(3) class actions--not that they were ever easy.)  Merck settled the Vioxx litigation by contracting with the plaintiffs' attorneys and requiring those law firms to recommend the deal to 100% of their clients (with the caveat that the plaintiffs' attorneys deemed the settlement in their clients' best interests), and to withdraw from representing those clients who refused.  Moreover, Merck could walk away from the deal if fewer than 85% of the claimants signed on.  Thus, while claimants technically opted "into" the settlement offer, realistically claimants had to opt out of their lawyer-client relationship if they didn't want to settle.  

Yesterday's article in the NY Times by John Schwartz and Cambell Robertson, "Many Hit by Spill Now Feel Caught in Claims Process," illustrates the new, new opt out: plaintiffs' lawyers are claiming to represent clients who have never consented to an attorney-client relationship.  Consider this excerpt from the article:

Last summer and fall, numerous Vietnamese households — including some who say they were not even affected by the spill — received letters signed by Mr. Watts, of San Antonio. The letters, in Vietnamese, addressed some recipients by name and others as: “Dear Client.” The letters directed people to send their financial records and added, “Do not sign anything from BP or anyone else except Watts Guerra Craft,” the name of the firm.

“As far as I know almost every other house got it,” said Felix Cao, a law student at Loyola University in New Orleans. “I don’t know how they even found my address.”

Mr. Cao said he did not know whether he had become a client or simply a marketing target. He said he was not affected by the spill.

Nor was Nga Nguyen, who lives in New Orleans and also received one of the letters. “I think they just went through the phone book,” she said.

Let me be clear: the Gulf Coast Claims Facility is a private compensation scheme set up by BP.  The claims pending before Ken Feinberg are NOT class actions.  Thus, no attorney-client relationship exists absent either class certification and a judicial determination that lawyers are adequately representing absent clients (in the MDL pending before Judge Barbier) or an individual's affirmative consent to enter into an attorney-client relationship.

Yet, if this is what attorneys are doing, the new, new opt-out requires "clients" to opt out of an attorney-client relationship they never formed.  The result is nothing short of lawless.  

ECB

 

April 19, 2011 in Aggregate Litigation Procedures, Current Affairs, Environmental Torts | Permalink | Comments (0) | TrackBack (0)

Sunday, April 3, 2011

Some Thoughts on the Seventh Circuit's Opinion in Randall v. Rolls-Royce Corp.

With the Supreme Court hearing oral arguments in Wal-Mart Stores, Inc. v. Dukes last Tuesday, there's a good bit of focus from around the web on the individualized hearings aspect of Randall v. Rolls-Royce Corp., a Seventh Circuit opinion decided on March 30, 2011.  In Randall, Judge Posner affirmed the denial of class certification for a Title VII and Equal Pay class action because plaintiffs' were inadequately represented and because backpay would require individualized hearings.

What was most interesting to me about the case, however, was its tie-in to Smith v. Bayer Corp., which is still pending before the Supreme Court.  Recall that Smith v. Bayer Corp. presents the question of whether to afford preclusive effect to a federal court's decision not to certify a class.  

In Smith v. Bayer, I found two things troubling about the Eighth Circuit's opinion below (In re Baycol Products Liability Litigation).  First, the appellate court suggested that plaintiffs should've intervened in the first suit to preserve their right to appeal, but, because the class was never certified, no notice was ever sent out to the class members.  How should the plaintiffs have known to intervene without any formal notice that the lawsuit was pending?  

Second, although the class was never certified, the appellate court nevertheless claimed that the plaintiffs were adequately represented.  This is odd.  Parties can be bound to a decision when they were parties to the previous suit, in privity with those parties, or were adequately represented.  Putative class members are generally not considered parties to a suit until the class has been certified; here, the plaintiffs in the second suit were not the named plaintiffs in the first suit.  

Similarly, it's hard to see how the parties in the second suit were adequately represented in the first suit.  Can a court really conclude that a putative class was adequately represented when it chooses not to certify the class and it's the certification decision that operates to legitimize the actions of the class representatives and class counsel to act on behalf of the class?  This also raises personal jurisdiction questions.  Following the rationale from the Supreme Court's opinion on personal jurisdiction in Phillips Petroleum v. Shutts, it's hard to see how the second plaintiffs would be bound by the federal court's decision not to certify the class.  In Shutts, the court likened the failure to opt out of a (b)(3) class to consent to jurisdiction.  Courts have long held that plaintiffs consent to personal jurisdiction by submitting their claims to the court.  So, by failing to opt out, the plaintiffs effectively "consented."  But in the Baycol litigation, there was no certification, thus no chance to opt-out, thus no consent.  From that, it would seem that there was no personal jurisdiction (one of the questions certified in Smith v. Bayer).  Likewise, this seems to put us quite close to the doctrine of virtual representation that the Supreme Court struck down in Taylor v. Sturgell.

The logical question that follows shows just how slippery the Eighth Circuit's reasoning was in In re Baycol and it's also the tie-in to the Seventh Circuit's opinion in Rolls-Royce: What is the preclusive effect of a decision not to certify the class when class counsel is incompetent?  Can a court really say that the class was adequately represented after it explicitly finds that adequacy isn't met?  

The Seventh Circuit in Rolls-Royce took great pains to explain how plaintiffs' counsel dropped the ball, picked poor class representatives, and did not diligently pursue the case.  Should this effort and the resulting decision not to certify the class really preclude subsequent attorneys from trying to certify a similar class?  Granted, the district court in Rolls-Royce also granted summary judgment to the defendants, so these circumstances are a bit different, but it doesn't take much imagination to see the harm that could result from the Eighth Circuit's reasoning.

ECB

April 3, 2011 in Class Actions, Current Affairs, Procedure, Products Liability | Permalink | Comments (0) | TrackBack (0)

Tuesday, March 29, 2011

Today's Dukes v. Wal-Mart Stores, Inc. Oral Argument

Adam Liptak has an article in today's New York Times on the oral argument in Dukes v. Wal-Mart Stores, Inc., which is available here.  And here's a link to the oral argument transcript.

ECB

March 29, 2011 in Class Actions, Current Affairs | Permalink | Comments (0) | TrackBack (0)

Monday, March 28, 2011

NY Times Piece on Social Framework Evidence in Dukes v. Wal-Mart

Though Dukes v. Wal-Mart Stores, Inc. concerns employment discrimination as opposed to mass torts, it has the potential to change Rule 23(a)'s class certification standard across the board.  So, for those of you who have been following the case, Adam Liptak has an interesting article in today's New York Times on the evidentiary questions concerning social framework evidence that lies at the heart of the Dukes controversy.

For other commentary on tomorrow's oral argument, here's a link to Sarah Crawford's ACS post

ECB

March 28, 2011 in Class Actions, Current Affairs | Permalink | Comments (0) | TrackBack (0)

Tuesday, February 15, 2011

The Future of Arbitration: George Washington Conference

Alan Morrison and Roger Trangsrud of George Washington are hosting a conference on the future of arbitration on March 17-18. 

Here's a description of the program and list of the panels and times:

Over the past several decades, the Federal Arbitration Act (FAA) has been increasingly used by businesses to divert claims from the courts into the arbitral forum that they consider more favorable to them, which in many cases means that, as a practical matter, the claims will never be brought.  In almost every case, the Supreme Court has upheld the position of the person arguing that unwilling parties who signed agreements containing a mandatory pre-dispute arbitration provision can be required to pursue their claims in arbitration. 

Since the enforceability of such agreements is governed by the FAA, Congress can amend the FAA if it believes that those decisions produce undesirable results. The purpose of this conference is to debate the key policy questions surrounding various aspects of arbitration. The program will not be about what the FAA now permits and requires, but what it should permit and require.

Panel discussions will be held in the Jacob Burns Moot Court Room.

March 17

2-3:30 pm
Panel: Channeling Class Actions into Single Claims Arbitrations

Andrew Pincus, Partner, Mayer Brown
Alan Kaplinsky, Partner, Ballard Spahr
Deepak Gupta, Staff Attorney, Public Citizen Litigation Group
Joshua Civin, Assistant Counsel of the Economic Justice and Education Practices, NAACP Legal Defense Fund

3:30-3:45 pm: Break

3:45-5:15 pm
Panel:
Proper Forum for Class Actions - Court or Arbitration?

Eric Tuchmann, General Counsel and Corporate Secretary, American Arbitration Association
Brian Wolfman, Visiting Professor of Law and Co-Director, Institute for Public Representation, Georgetown Law
Jay Tidmarsh, Professor of Law, Notre Dame Law School

March 18

8-8:30 am: Breakfast

8:30-10 am
Panel: Procedural Rules or Limits & Federal vs. State Law

Paul Bland, Senior Attorney, Public Justice
Nina Pillard, Professor of Law, Georgetown Law
Thomas Stipanowich, Academic Director, Institute for Dispute Resolution, William H. Webster Chair in Dispute Resolution, and Professor of Law, Pepperdine University 
Christopher Drahozal, John M. Rounds Professor of Law and Associate Dean for Research & Faculty Development, University of Kansas

10:15-11:45 am
Panel: The Role of Courts in Supervising Arbitrations

George Bermann, Jean Monnet Professor in EU Law, Walter Gellhorn Professor of Law, and Director of European Legal Studies, Columbia Law School
Nancy Welsh, Professor of Law, Penn State Law
Jean Stemlight, Director of the Saltman Center for Conflict Resolution and Michael and Sonja Saltman Professor of Law, the University of Nevada, Las Vegas

Noon-1 pm: Lunch

1:15-2:45 pm
Panel:
What Should Congress Do Beyond Procedural Reforms?

Kevin Carroll, Securities Industry Association
Elisabeth Stein, American Association for Justice
John Roddy, Partner, Roddy Klein & Ryan
Stephen Burbank, David Berger Professor for the Administration of Justice, University of Pennsylvania Law School

If you're interested in attending here's the registration link.

ECB

February 15, 2011 in Class Actions, Conferences, Current Affairs | Permalink | Comments (0) | TrackBack (0)

Monday, January 17, 2011

Litigation Funding

I hope are readers are having a good MLK day and that your employer gave you the day off in observance!

Benyamin Applebaum of the NY Times has an article on litigation funding in torts - the first story there is of a Vioxx plaintiff.  See the article here

For a very insightful take on litigation funding, in particular arguing that it is a good way to disgorge the appropriate amount from the defendant rather than permitting the defendant to get a discount because of plaintiffs economic situation, see Steven Gillers post at the Legal Ethics forum here.

Readers interested in this topic might also want to take a look at Maya Steinitz, Whose Claim is this Anyway? Third Part Litigation Funding, available on SSRN.

ADL

January 17, 2011 in Current Affairs, Ethics, Lawyers | Permalink | Comments (0) | TrackBack (0)

Tuesday, December 14, 2010

Judicial Hellholes 2010 report released by ATRA

The American Tort Reform Association each year releases a report on the jurisdictions that it considers the most plaintiff-friendly in the nation.  The 2010 honorees are (1) Philadelphia, (2) California, particularly Los Angeles County and Humboldt County, (3) West Virginia, (4) South Florida, (5) Cook County, Illinois, and (6) Clark County, Nevada.  The additional "watch list" includes traditional favorites Madison County, Illinois; Atlantic County, New Jersey; St. Landry Parish, Louisiana; and St. Clair County, Illinois; as well as the District of Columbia, New York City and Albany, New York.

Is it just me, or does the "hellhole" label feel outdated?  Of course some jurisdictions tend to be more favorable for either plaintiffs or defendants, given that there are meaningful variations in laws, jury demographics, and judicial selection processes.  That's why forum-shopping won't disappear anytime soon as a favorite activity of litigation strategists.  But the heyday of the "magnet courts" in Madison County, the Gulf Coast, and the Rio Grande Valley seems like a long time ago.  Not only has the tort reform movement been successful at achieving changes in Madison County and other jurisdictions, but CAFA has made it easy to remove large-scale class actions to federal court and thus has reduced concerns about certification of nationwide class actions in state courts.

ATRA's 2010 list is weighted toward some of the biggest legal markets in the U.S.:  Philadelphia, Los Angeles, Miami, Chicago, New York and Washington.  This gives the report a different flavor.  Rather than primarily calling attention to relatively small counties with truly renegade judges and juries, the 2010 report seems heavily focused on cases in which judges conducted consolidated trials, denied motions to dismiss, or otherwise took actions that were not in defendants' favor. 

To those who follow mass tort litigation, it is interesting to see which jurisdictions are perceived by defendants and the insurance industry as the most threatening.  For this, the ATRA report is worth reading, even if it is anecdotal rather than data-driven.  But the hyperbole of the "hellhole" label gets in the way of taking the report as seriously as its proponents would like.

HME

December 14, 2010 in Current Affairs, Mass Tort Scholarship | Permalink | Comments (0) | TrackBack (0)

Friday, December 10, 2010

The Coming Revolution in Class Actions

This term the Supreme Court has granted cert in three class action cases and each case has a far reach.  Depending on what the court does with these cases, the world of complex litigation could be dramatically changed. These aren't really mass tort cases, but the topic is tangentially related to ours so here goes, gentle readers. If you are not interested in this stuff, surf on.

As we've been discussing on this blog, the Wal-Mart class action presents the court with the opportunity to rethink the requirements of 23(a) (how much do class members have to have in common for a class action to be certified) and 23(b)(2) (can any money damages claims be included?).  The Baycol case presents the court with the question of whether certification determinations are preclusive.  And the Concepcion case presents the question as to whether arbitration agreements barring class actions cannot be struck down based on state law contract doctrine -- in other words, must they be upheld under the FAA?

If the court follows its current trend of limiting class actions, by June we will be living in a world where the commonality requirement is very strict (class members will have to show that their common questions of law and fact also have common answers), if they fail to certify their class they'll be precluded from trying again, perhaps even if they were not class representatives, and consumers will be almost universally barred from bringing class actions (because what company in its right mind would choose not to have an arbitration provision barring class treatment?). 

ADL

 

December 10, 2010 in Class Actions, Current Affairs, Procedure | Permalink | Comments (0) | TrackBack (0)

Monday, December 6, 2010

Supreme Court Grants Cert in Dukes v. Wal-Mart Stores, Inc.

In a long awaited decision to Wal-Mart's petition, the United States Supreme Court granted review in Dukes v. Wal-Mart Stores, Inc.  There's already been a good bit of academic commentary on the case.  Vanderbilt Law Review En Banc hosted a Roundtable discussion on the case, which is available here.  It includes my introduction to the issues in the Dukes case along with Bob Bone's essay, Sorting Through the Certification Muddle; Greg Mitchell's essay, Good Causes and Bad Science; Alexi Lahav's essay, The Curse of Bigness and the Optimal Size of Class Actions; and, of course, the late Richard Nagareda's essay, Common Answers for Class Certification.

Suzette Malveaux, Bob Bone, Melissa Hart, and I will be hosting a "hot topics" panel on the Dukes case at this year's AALS meeting.  The panel is currently scheduled for Friday, January 7, 2011, from 8:30-10:15 a.m. at the San Francisco Hilton.  We have, however, requested that the location be changed due to the on-going labor disputes, so an update may follow.  

Update: Interestingly, the Court granted cert only on Wal-Mart's first question, "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."  (Wal-Mart Petition for Cert. at i).  The Court also directed the parties to "brief and argue the following question: 'Whether the class certification ordered under Rule 23(b)(2) was consistent with Rule 23(a).'"  For those who are interested, I address the issues underlying this question in pages 93-98 of the Introduction.

ECB

December 6, 2010 in Class Actions, Conferences, Current Affairs, Procedure | Permalink | Comments (0) | TrackBack (0)

Tuesday, November 23, 2010

Economic Claims Against Toyota Move Forward

Last week, District Judge James Selna refused to dismiss the economic injury claims by Toyota owners who alleged that the unintended acceleration problems caused a decrease in their cars' value.  The multi-district litigation includes more than 200 economic injury class actions and around 100 personal injury and wrongful death claims.  Judge Selna will consider Toyota's motion to dismiss the cases alleging wrongful injury and death on December 9.  Here's a link to the National Law Journal story.

ECB

November 23, 2010 in Current Affairs, Vehicles | Permalink | Comments (0) | TrackBack (0)

Saturday, November 20, 2010

Other-Regarding Preferences in the 9/11 Workers Settlement

Reading yesterday’s New York Times article on the 9/11 Workers Settlement, I couldn’t help but think of the other-regarding preferences and psychological influences that played a role in garnering the requisite 95.1% agreement.  The two claimants quoted in the article, Jennifer McNamara (whose firefighter husband died of colon cancer last year) and Kenny Specht, a retired firefighter with thyroid cancer, both framed their ultimate decision to participate in the settlement in terms of helping others within the community of plaintiffs.  As described by the N.Y. Times, McNamara “explained to friends in a letter that she did not want to delay the settlement for the many plaintiffs who needed it to pay mortgages and medical bills.”  Specht said, “I am not sure that holding out for a better offer will ever be something that is attainable.”  

I’ve written about this internal group pressure in the past and how claimants might be able to use it to their benefit as opposed to lawyers using it for theirs.  It does appear that Napoli Bern Ripka LLP held at least one town hall meeting (video footage available below), but I’m not sure whether claimants were encouraged or given opportunities to discuss the deal with one another or whether the lawyers did most of the talking.  Given the claimants geographical proximity to one another in the 9/11 Workers Settlement as well as the closeness of the firefighting and police officers’ communities, it appears that altruism, reciprocity, and a concern for others' well-being within their community played a significant role in members’ decision to approve the settlement (though the settlement did not receive the 100% approval rate that would have paid out $712 million).  Others simply appeared to be exhausted by the protracted litigation and wanted finality.  Still others, at least 520 of them, opted out (or did not respond by the deadline).  A New York Times article last August described several plaintiffs' difficult decision-making process.

 

Although the House of Representatives has approved a bill that would reopen the 9/11 Victim’s Compensation Fund, the Senate has yet to approve it and those who have signed on to the 9/11 Workers Settlement will be ineligible for compensation.  

Here's a link to Napoli Bern's press release (with the percentage of claimants signing-on in each tier).

ECB

 

 

November 20, 2010 in 9/11, Current Affairs, Informal Aggregation, Mass Disasters, Settlement | Permalink | Comments (0) | TrackBack (0)