Saturday, March 3, 2012
John Schwartz at the New York Times reports that the litigation surrounding the BP Deepwater Horizon Oil Spill has settled for all of the litigants except the federal government. The Judge overseeing the litigation issued the order late Friday night and will review the settlement.
Here's the report from Bloomberg as well.
According to these reports, either the settlement will be paid by the $20 billion fund BP created to compensate victims or the fund will close and be replaced by a court overseen claims facility. In any event, the amount of the settlement is $7.8 billion that from these reports is not in addition to the $20 billion already set aside.
More to come. ADL
Wednesday, February 29, 2012
An intrepid reporter asked me today what a good precedent would be for a settlement in the BP litigation - something on point, not a products liability mass tort settlement but an environmental toxic tort settlement of the magnitude that this would have to be. I couldn't think of anything except the Exxon case, which of course was litigated. Any other ideas?
Tuesday, February 28, 2012
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.
Saturday, February 18, 2012
NPR has a story with lots of interesting quotes. My favorite:
"There's only one place where a waitress or a shrimper can be on equal footing with a company the size of BP, and that's a courtroom," says Rhon Jones, with the Montgomery, Ala., law firm Beasley Allen. Jones is part of the plaintiffs' steering committee, a group of lawyers coordinating the case.
The story raises a series of important questions about the purpose of litigation and settlement. Is it best for society to funnel cases outside that system as in the BP and 9/11 cases? What is the use of a trial - to apportion liability? get to the truth? allocate damages? figure out difficult causation questions? Are different plaintiffs to be treated differently - for example the waitress and the shrimper above as opposed to the attorneys general of the affected states?
Edited to add: I just saw the blog post by George Conk about the potential ineligibility of many plaintiffs who did not file claims with the compensation fund. See here for more analysis.
Monday, January 30, 2012
No Formaldehyde Liability for US for FEMA Trailers After Hurricanes Katrina and Rita, Fifth Circuit Holds
The decision in In re FEMA Trailer Formaldehyde Products Liability Litigation, Nos. 10-30921, 10-30945 (5th Cir. Jan. 23, 2012), turns on liablity for the government "to the same extent" as private individuals, under the Federal Torts Claims Act, and the protection afforded private individuals giving voluntary disaster assistance under Good Samaritan statutes in Alabama and Mississippi.
Saturday, January 21, 2012
CNN reports that Chevron has appealed the $8.6 billion environmental judgment to Ecuador's National Court. The case has been closely watched not only for its high dollar amounts, but for the questions raised by Chevron about the integrity of Ecuador's courts. Questions of foreign-court bias may be more frequent as mass tort litigation increasingly becomes global tort litigation, and disputes against large, deep-pocketed corporations are brought by foreign claimants in foreign courts.
Tuesday, January 17, 2012
Adam Zimmerman (St. John's) has a nice post on Prawfsblawg called "The Rise of Executive (Branch) Compensation" in which he discusses the historical antecedents and politics of compensation funds for mass disasters. It reminds us that not all worthy victims have been the beneficiaries of such funds and the reasons why some are picked (and others are not) are not always clear.
Saturday, January 14, 2012
All that in the recent interesting op-ed from New York Times business columnist Joe Nocera -- BP Makes Amends.
January 14, 2012 in Aggregate Litigation Procedures, Environmental Torts, Informal Aggregation, Lawyers, Mass Disasters, Procedure, Punitive Damages, Settlement | Permalink | Comments (0) | TrackBack (0)
Monday, December 5, 2011
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.
Wednesday, November 30, 2011
Monday, November 7, 2011
On this Friday, November 11, 2011, Southwestern Law School in Los Angeles will host a symposium on CERCLA and the Future of Liability-Based Environmental Regulation. Here's a description of the symposium:
Enacted in 1980, CERCLA takes a unique approach to federal environmental regulation. Unlike other major federal environmental statutes, CERCLA addresses soil and groundwater contamination through a tort-like liability scheme imposing joint and several, retroactive liability on broad classes of covered persons to clean up contaminated property. With billions of dollars in aggregate cleanup costs at stake, CERCLA has generated substantial and unrelenting litigation over the past three decades that will likely continue for years to come.
CERCLA presents challenging issues about the relationship between federal and state pollution laws on topics ranging from regulatory oversight to toxic torts. Some accuse CERCLA's broad liability scheme and remediation process requirements (the "national contingency plan") of fostering sprawl by discouraging in-fill property development. Others object to federal and state "brownfield" laws promoting more streamlined in-fill remediation on environmental justice grounds. The U.S. Supreme Court's recent decisions in Aviall, Atlantic Research and Burlington Northern raised new questions about the scope of CERCLA liability, the extent of public and private cost recovery rights, and incentives for polluters to settle CERCLA liabilities with regulatory authorities.
These timely issues address important concerns affecting industries, communities and regulators across the country; they also present bigger picture questions. Has CERCLA worked? Can it be improved? Should CERCLA's tort-like liability-based approach to environmental regulation be employed to address other environmental problems? This symposium will explore the impact of CERCLA on the current state of contaminated property law over the past 30 years and the future of liability-based environmental regulation.
UPDATE -- Here's a desciption of the symposium panels:
Panel #1: CERCLA and Federalism. This panel will discuss the relationship between state and federal contaminated property and land use law, including issues relating to the evolution of state Superfund statutes and tort law, preemption, and concurrent federal, state and local regulatory authority. Speakers: Prof. Robin Kundis Craig (Florida State); Prof. Alexandra Klass (Minnesota); Prof. William Rodgers (Washington); Moderator: Prof. Ann Carlson (UCLA)
Panel #2: CERCLA, Brownfields and Distributive Equity. This panel will focus on the economic, public health and social welfare impacts of CERCLA liability and remediation process requirements on land use and redevelopment, including the economic benefits and environmental justice implications of state and federal brownfield programs. Speakers: Prof. Joel Eisen (Richmond); Prof. Eileen Gauna (New Mexico); Jay Pendergrass, Esq. (Environmental Law Institute); Nicholas Targ, Esq. (Holland & Knight);Moderator: Romel Pascual (Deputy Mayor for Environment, City of Los Angeles)
Panel #3: CERCLA – Public Enforcement. This panel will focus on the effectiveness and normative value of CERCLA’s liability-based regulatory scheme, including an evaluation of the public health and welfare efficacy of the CERCLA cleanup process under the national contingency plan, and the effect of the U.S. Supreme Court’s Atlantic Research and Burlington Northern decisions on public enforcement and regulatory agency settlement options. Speakers: Prof. Martha Judy (Vermont); Prof. Joel Mintz (Nova Southeastern); Prof. Robert Percival (Maryland); Moderator: Professor Daniel Selmi (Loyola)
Panel #4: CERCLA – Private Enforcement. This panel will explore the impact of the Aviall, Atlantic Research and Burlington Northern decisions on CERCLA private cost recovery litigation, as well as waste disposal and litigation behavioral incentives on the regulated community created by CERCLA and the dispute resolution challenges presented by CERCLA’s liability scheme. Speakers: Prof. Steven Ferrey (Suffolk); Prof. Craig Johnston (Lewis & Clark); Prof. Alfred Light (St. Thomas); Moderator: Prof. Ronald Aronovsky (Southwestern)
Monday, September 19, 2011
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.
Thursday, July 7, 2011
BNA Class Action Litigation Reporter reports that the lawsuits against Bayer Cropscience for the contamination of rice crops with genetically modified rice have settled. The case was In Re: Genetically Modified Rice Litigation, E.D. Mo., No. 4:06-md-1811.
The plaintiffs were denied class certification for predictable reasons. The settlement is equally predictably organized on the Vioxx model: it goes into effect if 85% of the farmers sign on.
For more information on the MDL GMO Rice Litigation see the E.D.Mo. website: http://www.moed.uscourts.gov/node/115. (As for this writing, not updated to reflect the BNA report of settlement). As the website notes, the GMO rice has since been de regulated by the FDA.
Image by scottchan.
Thursday, June 9, 2011
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
Wednesday, April 20, 2011
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.”
Tuesday, April 19, 2011
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.
Sunday, March 27, 2011
The Mississippi College Law Review has posted the video for its symposium, Beyond the Horizon: The Gulf Oil Spill Crisis -- Analyzing the Economic, Environmental, and Legal Implications of the Oil Spill.
Panel One included Ms. Trudy Fisher, Executive Director, Mississippi Department of Environmental Quality; Professor Kenneth Murchison, James E. & Betty M. Phillips Professor, Paul M. Herbert Law Center Louisiana State University; and Professor David Robertson, W. Page Keeton Chair in Tort Law University Distinguished Teaching Professor, University of Texas at Austin. The moderator for Panel One was Ms. Betty Ruth Fox, Of Counsel, Watkins & Eager.
Panel Two included Professor Jamison Colburn, Professor of Law, Penn State University; Professor Edward Sherman, W.R. Irby Chair & Moise S. Steef, Jr. Professor of Law, Tulane University; and myself. The moderator for Panel Two was Professor Jeffrey Jackson, Owen Cooper Professor of Law, Mississippi College School of Law.
Kenneth Feinberg, claims administrator for the Gulf Coast Claims Facility, delivered the symposium Keynote Presentation.
Papers from the symposium will published in the Mississippi College Law Review. Here's the abstract for my symposium talk and forthcoming article:
The Gulf Coast Claims Facility set up following the BP Gulf Oil Spill might be seen as creating a new category of claims fund that might be termed a quasi-public mass tort claims fund. Unlike purely public funds such as the 9/11 Victim Compensation Fund, or purely private funds such as are increasingly created for mass settlements as in Vioxx, the Gulf Coast Claims Facility is funded privately by BP, but bears the public imprimatur of having been initially negotiated by President Obama. Indeed, in an Oval Office Address, President Obama promised that claims would be "fairly" paid and that the fund would "not be controlled by BP," but would instead be administered by an "independent third party." While a quasi-public fund has the advantage of delivering swift compensation in response to an ongoing crisis, the quasi-public fund risks claimant confusion about claim-administrator independence and whether claimants should retain their own counsel to assist in evaluating fund settlement offers. In turn, that claimant confusion can jeopardize the fund's societal savings in attorney-fee transaction costs, and lower claimant participation in the fund. Accordingly, to minimize claimant confusion, a quasi-public fund should provide transparency in its fee structure for claims administrators, and seek a claims-administrator fee structure that minimizes bias, such as utilizing a fixed fee not subject to reevaluation or having defendant agree to a third-party panel's assessment of fees for claims administrators. With regard to the Gulf Coast Claim Facility, claimant participation would likely be enhanced by greater transparency and use of a third-party panel to determine claim-administrator fees.
Saturday, February 26, 2011
Wednesday, February 16, 2011
On this Friday, February 18, Mississippi College School of Law will be hosting a law review symposium, Beyond the Horizon: The Gulf Oil Spill Crisis -- Analyzing Economic, Environmental, and Legal Implications of the Oil Spill. Here's the short-form brochure: Download MC Law Review Symposium Brochure.
Speakers include Professors Jamison Colburn (Penn State), Kenneth Murchison (LSU), David Robertson (Texas), Edward Sherman (Tulane), and Trudy Fisher (Miss. Dep't Envt'l Quality). Moderators include Jeffrey Jackson (Mississippi College) and Betty Ruth Fox (Watkins & Eager). Papers will subsequently be published in the Mississippi College Law Review.
I will also be speaking at the symposium, discussing issues of claim-administrator compensation, transparency, and independence in connection with the Gulf Coast Claims Facility. My talk will expand upon my prior blog posts raising concerns (see here and here), which last summer triggered two articles in Forbes (see here and here), as well as a post from Legal Ethics Forum. Two weeks ago, the federal MDL court overseeing the BP litigation granted in part plaintiffs' motion to have the court oversee communications by the Gulf Coast Claims Facility, and the MDL court ordered that the Gulf Coast Claims Facility may not state that it is "neutral" or completely "independent" of BP. Here's the MDL opinion: Download Order - Mot to Supervise GCCF Doc 1098 2-2-2011. On the recent MDL opinion, see also this Reuters article from Moira Herbst, quoting David Logan (Roger WIlliams), Monroe Freedman (Hofstra), and me.
UPDATE -- Here's the full-length brochure for the symposium: Download MC Law BP Symposium Handout.