Mass Tort Litigation Blog

Class action filed involving Puerto Rico explosion

On Friday morning, a huge explosion occurred at a Caribbean Petroleum Corp. fuel storage facility near San Juan, Puerto Rico.  On Friday afternoon, the first class action was filed.  Here's the WSJ Law Blog report with a brief interview in which Louisiana plaintiffs' lawyer Daniel Becnel explains how he became involved so quickly and what immediate steps he took:

I got a call this morning from [Puerto Rico lawyer] John Nevares, who said he knew I’d handled these kinds of cases and that he had clients. What I immediately did was started to put together the complaint. I hired a mechanical engineer, a metallurgist, a psychiatrist, and an expert in air modeling. We also got up a Web site, so cases have been coming in on the Internet.

Responding to The Law Blog's question about the importance of filing first, Becnel focuses on getting the lawsuit started before the defendant has too much time to take control:

It’s not necessarily important to be the first, but it’s important to get in the door quickly. One of the main reasons is to get a preservation order in place to make sure that nobody destroys physical evidence. You need to get in there fast to find out what really happened.  When something like this happens — and I’ve worked on a handful of them — the first thing a company does is call its insurance claims agent. They’re on the scene within an hour. They’ll try to show that nobody’s hurt and that the damage is minimal. They’ll put out a press release. You’ve got to get in there so you can start working the other side as soon as possible.

HME

Passing of David I. Shapiro

Litigator David I. Shapiro, founding partner of the firm Dickstein Shapiro, has died.  In a career that spanned many areas of litigation, Mr. Shapiro also was active in several prominent mass tort litigations, and came to focus on mediation as a case management method.  Here's an excerpt from the Wall Street Journal's obituary:

Mr. Shapiro branched out into class-action suits in the late 1960s. He handled the states' cases in a complex federal price-fixing lawsuit against manufacturers of the antibiotic tetracycline, winning a $100 million verdict for the states.

Later, Mr. Shapiro took on cases related to breast implants, asbestos and the Exxon Valdez oil spill. In 1984, he was assigned as a special master to handle a $180 million settlement resulting from the Agent Orange case, then among the largest class-actions suits to date.

But Mr. Shapiro came to feel that much of class-action litigation was driven by greed, and that cases could be better settled by other means. He developed an expertise in negotiations, and was chairman of the American Bar Association's National Institute on New Techniques for Resolving Complex Legislation.

"It's possible to get justice and recompense for consumers without the greed of the few that plagues the U.S. system," he told the Telegraph of London in 2007.

He taught mediation at the London School of Economics, and created a mediation practice at SJ Berwin. 

BGS

Fifth Circuit Ruling for State Farm in Hurricane Katrina Insurance Dispute

More from AmLaw Litigation Daily.  The opinion is here.  Congratulations to my former Skadden colleagues Sheila Birnbaum, Doug Dunham, and Ellen Quackenbos, who represented State Farm.

BGS

Air Disaster Case Dismissed on Forum Non Grounds

BNA Class Action Reporter notes that a class action brought against Airbus on behalf of the 77 persons that perished when a plane went down near Brazil in July 1007 was dismissed on Forum Non Conveniens grounds.  The case will have to be litigated in Brazil. See Tazoe v. TAM Linhas Aereas, S.D. Fla., No. 07-21941-CIV, 8/21/09. 

Readers interested in the topic of class actions in Latin America will want to read my colleague Angel Oquendo's article:  Angel Oquendo, Upping the Ante: Collective Litigation in Latin America, 47 Colum. J. Transnat’l L. 248 (2009).

ADL

Latest Use of Bellwether Trials

Bellwether trials are gaining popularity, particularly in Louisiana.  After Judge Fallon used the trials to help establish settlement values in the Vioxx litigation, Judge Kurt D. Engelhardt is proposing their use in the litigation over formaldehyde-laden FEMA trailers (FEMA Trailer Formaldehyde Prods. Liab. Litig, MDL No. 1873, E.D. La.).  As is typical in bellwether trials, the jury's opinion is advisory only and does not bind the parties for purposes of preclusion.  The government has strongly opposed a jury trial given that the jury pool is likely to have strong feelings about the government's handling of pre- and post-Katrina events.  Plaintiffs claim that the government-supplied trailers contained toxic materials, including formaldehyde.

ECB

Cert denied in 9/11 Saudi Liability Case

The Supreme Court yesterday denied certiorari in Burnett v. Al Baraka, in which plaintiffs sought to hold Saudi Arabia and the Saudi royal family liable for the September 11 terrorist attacks.  The plaintiffs sought to establish liability by linking the Saudis to the financing of Al Qaeda.  The Second Circuit held that the claims were barred by the Foreign Sovereign Immunities Act, reasoning that terrorism claims against a foreign government required a state department designation of that government as a supporter of terrorism.

Here's an excerpt from today's article in the Philadelphia Inquirer:

In a decision that creates broad immunity for Saudi Arabia in terrorism lawsuits, the Supreme Court yesterday let stand lower-court rulings that the desert kingdom and senior members of the Saudi royal family are not liable for the 9/11 attacks.  ...

For the moment, the decision leaves untouched litigation against scores of Islamic charities, alleged terrorism financiers and financial institutions named as defendants in the case. But the Supreme Court's decision is a significant defeat for the 6,000 individual victims and family members along with insurers and other commercial interests seeking compensation. ...

The plaintiffs allege that Saudi Arabia funded and controlled Islamic charities that were used to launder money into al-Qaeda.  Absent that financial support, al-Qaeda never would have become a global terrorist threat and never would have been able to pull off the Sept. 11 attacks, they allege.

The Obama administration, concerned about the case's effect on U.S.-Saudi relations, weighed in with an amicus brief last month urging the Supreme Court to decline the case.

HME

NTSB Finds Identifies Two New Instances of Airbus-Sensor Problems

Article in the Wall Street Journal -- Safety Board Cites Two New Reports of Problems With Airbus Sensors, by Andy Pasztor.  Here's an excerpt:

U.S. air-crash investigators are looking into two recent incidents in which they believe Airbus A330 jetliners suffered airspeed sensor malfunctions similar to those being examined in the crash of Air France Flight 447 last month.

The National Transportation Safety Board on Thursday identified separate malfunctions on two different airlines that ended with safe landings over the past few weeks. They appear to describe the same type of malfunction -- triggering a loss of autopilot and automatic-throttle -- that investigators believe occurred on the Air France A330 shortly before it crashed May 31 en route from Rio de Janeiro to Paris in stormy weather.

Such airspeed issues aren't enough to bring down a jetliner. Investigators in the Air France crash suspect a combination of turbulent weather, possible computer glitches, pilot actions and perhaps other factors combined to put the jet into a fatal dive.

BGS

Shell Settles Nigerian Human Rights Case for $15.5 Million

Article on cnnmoney.com -- Shell pays $15.5M in Nigeria suit: Oil company settles a claim that it violated human rights leading to the killings of a famous writer and other activists in 1995.  Here's an excerpt:

Shell has agreed to a $15.5 million settlement in a lawsuit that claimed the oil company supported civil rights abuses in Nigeria that led to the killings of a famous writer and other activists in 1995.

The family of writer Ken Saro-Wiwa and nine other people filed the suit in New York, alleging that Shell was partially responsible for the then-military regime's oppression of the Ogoni people in the Niger Delta. Saro-Wiwa and other activists were protesting what they saw as environmental abuses by Shell.

Shell, which said it "had no part in the violence that took place," called the settlement "a humanitarian gesture to set up a trust fund to benefit the Ogoni people."

BGS

Katrina Litigation Moves Forward

The New York Times reports that a lawsuit by property owners against the US Army Corps of Engineers regarding the breaking of the levees during Hurricane Katrina begins today.  Click this link to get to the article.  The article notes that the plaintiffs overcame the immunity issue, but still need to prove that government negligence, not the sheer force of the hurricane, caused their damage.  In terms of significance of this litigation, here's what the article says:

The plaintiffs say they hope a victory in the case could open the door for a broader class action in which more than 400,000 claims have been filed against the government. An Army financial projection has concluded that there is a reasonable possibility that potential government losses could ultimately range from $10 billion to $100 billion.

ADL

Damage Compensation for Low Probability/High Damage Events

Richard Lempert (Michigan) has posted an article entitled Low Probability/High Consequence Events: Dilemmas for Damage Compensation on bepress.  Here is the abstract:

This article was prepared for a Clifford Symposium which challenged paper writers to imagine how our system of tort compensation might look in the year 2020. This paper responds to an aspect of the general challenge: to imagine a tort recovery system which would deal adequately with rare and catastrophic events. To get a handle on this problem, the paper looks closely at how the legal system compensated damages attendant on four recent events that might be considered “rare and catastrophic” – Three Mile Island, 9/11, Hurricane Katrina and the Exxon Valdez oil spill. In no case did the system of compensation meet all the desiderata of a well-functioning tort compensation scheme, but the two no-fault schemes which provided the bulk of the compensation to those injured in the Three Mile Island and 9/11 disasters seem to have done better than the “ordinary” tort system which provided the bulk of the individual compensation for the damages caused by Hurricane Katrina and the Exxon Valdez oil spill. The 9/11 compensation scheme may, however, have been sui generis since it appears to have reflected both a national coming together after an attack on the homeland and Congressional efforts to protect the airline industry, and the Price-Anderson compensation scheme, which worked well in Three Mile Island, might have failed utterly had the disaster been on the scale of Chernobyl. Ultimately, the article concludes, no imaginable compensation scheme is likely to adequately handle a large, unique and unexpected catastrophe, but some improvements in current law and practice are possible and ad hoc political solutions, as with 9/11, may help in some cases.

This raises the following question in my mind: Are large "unique" catastrophes really unique? That is, should as a matter of procedure or institutional design treat tort claims arising out of Katrina or 9/11 differently than the tort claims arising out of use of Zyprexia or Vioxx?  If so, why?  One explanation might be that we think of disasters as being blameless, while we do assign blame in the tort context, but arguably that isn't true with respect to 9/11 (terrorists) or Katrina (government ineptitude).  Although it is the case that those wrongdoers cannot be successfully hauled into court.

ADL

ABA Section of Litigation Annual Conference

The ABA's Section of Litigation will have its Annual Conference on April 29 to May 1, 2009 at the Atlanta Marriott Marquis in Atlanta, Georgia.  Program topics include Causation and Injury in Toxic Torts -- An Examination of Modern Causation Principles in Toxic Tort Litigation; Enemy of the State -- The Challanges of Civil Litigation with States and Municipalities; and Preemption in Product Liability Litigation.

BGS

Flight 3407 Lawsuits and the Ethics of Client Solicitation

Litigation over Continental Flight 3407, which crashed near Buffalo last week, is inevitable.  But for lawyers interested in representing the plaintiffs, New York's new ethics rules on lawyer advertising and solicitation impose a significant constraint.  Over at the NY Personal Injury Law Blog, Eric Turkewitz (here and here) has been watching how law firms have tried to market themselves in the wake of the crash.  Interesting.  (Hat tip:  Overlawyered)

HME

Beijing Hotel Fire

A fire destroyed the Mandarin Oriental Hotel in Beijing today.  According to news accounts (here and here), the fire occurred in the final hours of the lunar new year celebration, as fireworks lit up the Beijing sky.  Thankfully, the hotel was newly constructed and not yet occupied, and no injuries or deaths have been reported.  But for those of us who follow mass tort litigation, the images of the fire conjure up memories of the 1986 San Juan Dupont Plaza fire and the 1980 MGM Grand Hotel fire, both of which involved numerous deaths and injuries and led to incredibly complex mass tort litigation.  The Beijing hotel was part of the same complex as the new CCTV (China Central Television) tower, one of the most architecturally distinctive modernist buildings in Beijing.

HME

Increased Risk for Space Workers Is Not Compensable Injury

BNA reports the dismissal of a suit by space center workers arising out of exposure to beryllium-containing products was upheld by the 5th Circuit. The court held that the workers were only able to show that the exposure resulted in increased sensitivity to the toxic substance, and that this was not a compensable injury.  Increased risk of developing chronic beryllum disease was not held to be sufficient to sustain the suit.  The case is Paz v. Brush Engineered Materials Inc., 5th Cir., No. 08-60085, 1/13/09. 

TVA-Spill Sludge Has Arsenic, But Water Tests Fine

Article on cnn.com -- Tennessee sludge contains elevated levels of arsenic, by Jim Kavanagh.  Here's an excerpt:

The drinking water in the area of last month's coal-sludge spill in eastern Tennessee is safe, but elevated levels of arsenic have been found in the sludge, authorities said.

A billion gallons of the sludge, made up of water and fly ash from a coal-burning Tennessee Valley Authority steam plant in Kingston, Tennessee, swamped 300 acres of mostly private property when a dike on a retention pond collapsed December 22.

All residents in the area were evacuated, and three homes were deemed uninhabitable, according to the TVA. About a dozen other homes were damaged.

BGS

Class Action Status Rejected for Katrina Generated FEMA Trailer Litigation

Judge Engelhardt denied class certification for litigants claiming that FEMA trailers exposed them to toxic fumes. Plaintiffs sued the federal government and several trailer manufacturers over elevated formaldehyde levels in the trailers housing hurricane victims. Individual issues included different trailer models, individual medical histories, and varying symptoms. The Associated Press story is available here and the Washington Post story is available here.

ECB

TVA Sludge Spill Results in High Levels of Arsenic & Heavy Metals in Two Tennessee Rivers

Article in on cnn.com -- EPA: Rivers high in arsenic, heavy metals after sludge spill.  Here's an excerpt:

The Environmental Protection Agency has found high levels of arsenic and heavy metals in two rivers in central Tennessee that are near the site of a spill that unleashed more than a billion gallons of coal waste.

The agency said it found "several heavy metals" in the water in levels that are slightly above safe drinking-water standards but "below concentrations" known to be harmful to humans.

"The one exception may be arsenic," the agency said in a letter to an affected community. "One sample of river water out of many taken indicated concentrations that are very high and further investigations are in progress."

BGS

Mass Tort Litigation & Preemption, Chinese-Style

Basically, it appears you sue the government for negligence in school-building construction that contributed to thousands of nationwide school-children earthquake deaths, and they just tell you to go away -- with the "judge t[elling] parents' representatives that government internal documents made it clear that the court should not be involved." That's according to an article in today's Wall Street Journal that describes a lawsuit by parents of Fuxin No. 2 primary school in Wufu, China.  Indeed, even finding a lawyer is difficult because as one parent noted, "All the lawyers told us the government didn't allow them to receive such cases." 

UPDATE:  More from the Wall Street Journal Law Blog:

Sang [(who is one of the parents suing)], reached on his cellphone, told the WSJ that he’s moving around in an effort to avoid the police, fearing that he will be detained. Sang said that families who lost children have each received an average of about 60,000 yuan, or about $8,800, in payments from government agencies.

 

BGS   

Metrolink Chief's Conduct Before and After Crash

Article in the L.A. Times -- Crash thrusts Metrolink chief into the unwelcome limelight, by Jeff Gottlieb.  Here's an excerpt:

He is one of those well-paid technocrats who makes sure things run smoothly, someone few people have heard of but so many depend on. Then something happens, and that cloak of invisibility disappears.

For David R. Solow, that moment occurred Sept. 12, when a Metrolink train crashed into a freight train in Chatsworth. Twenty-five people died and 135 were injured in the worst rail accident in modern state history. Suddenly Solow, chief executive of the Southern California Regional Rail Authority, which operates Metrolink, was much closer to the spotlight than he cared to be.

No member of Metrolink's board will say publicly that Solow's $220,000-a-year job is in jeopardy, but his performance is being scrutinized as never before. The board has appointed an 11-member panel composed mainly of academics and industry experts to examine the railroad's safety and operating procedures. The board also approved a review of Metrolink's emergency preparedness and crisis communications plans.

BGS

Exxon Makes First Payments to Valdez Spill Plaintiffs

Article in the L.A. Times -- Exxon Valdez victims receive first payments, by Kim Murphy.  (H/t to Torts Prof Blog.)  Here's an excerpt:

Reporting from Cordova, Alaska -- A little less than 20 years ago, Mike Webber was king of his own watery world. He was 28 years old, with three herring fishing boats. He leased another long-line boat for halibut, and gill-netted the fat salmon that made Prince William Sound one of the most legendary fisheries in the world.

Then came the 1989 Exxon Valdez oil spill. Overnight, it was all gone: Fish prices plummeted. People started selling their fishing permits to pay their mortgages, and then lost their houses anyway. Salmon rebounded, but the $12-million-a-year herring fishery all but disappeared.

On Friday, Webber and more than 200 other residents of this rain-soaked fishing town began getting the first round of punitive damage payments from ExxonMobil, closing the book on one of the nation's most epic battles over environmental destruction and corporate responsibility.

BGS