Saturday, August 16, 2008
The evolution of comparative fault is among this generation's most important tort law developments. Today, nearly every state follows some form of the rule, seeking to better align liability with culpability. Despite this guiding premise, states have struggled to define comparative fault's boundaries within the context of doctrine that developed in an earlier era. Courts have addressed many issues as part of this effort. One question that has escaped significant attention, however, is whether comparative fault should apply in a fraud action.
This Article asserts that comparative fault jurisdictions should not bar plaintiffs from recovering in fraud when they fail to establish justifiable reliance on a misrepresentation. Rather, courts should apply comparative fault principles and evaluate all parties' conduct in assessing damages. The Article begins by providing a brief overview of fraud, including the traditional element of justifiable reliance. It then considers the forces arrayed against the extension of comparative fault to fraud. These include the argument that justifiable reliance is merely a proxy for other elements of fraud, as well as courts' historical hesitation to apply comparative fault in any intentional tort claim or actions for purely economic harm. From there, the Article questions the status quo. It suggests that, in fact, some courts do take justifiable reliance seriously. It also notes that historical barriers to comparative fault's application in the area might be eroding. The Article then asserts that the application of comparative fault in fraud actions makes sense. It notes that policies relied upon by scholars who would limit the extension of comparative fault do not inherently apply in the area of fraud. More positively, the Article suggests that extending comparative fault to fraud would serve policies that led courts and legislatures to adopt comparative fault in the first place, as well as policies that underlie tort law generally. In sum, the refusal of courts to apply comparative fault to fraud is a vestige of an earlier day in which "all-or-nothing" rules dominated tort law. The policies that led to the development of comparative fault in almost every other area of tort law also deserve consideration in fraud.
Friday, August 15, 2008
Week 3 of the Roundup finds most TortsProfs preparing to return to the classroom. Here's what happened while the syllabi and final footnotes were polished.
Reform, Legislation, Policy
- Attorneys consider a constitutional challenge to Maryland's cap on punitive damages ($650,000 per instance) after a judge reduces a malpractice award from $4.5 million to $1.3 million. [Gazette.net via Wood/Point of Law]
- "Tort Reform Panic on the Right?" [Wahlstrom/Legal Broadcast Network, commentary by Franklin/Tort Deform]
- President signs new CPSC bill [Consumer Reports, Point of Law].
- Donald Trump files a privacy suit against his former law firm for using his name and image "for advertising purposes." [ABA Journal]
- Is Big Caffeine the Next Target? [Frank/Overlawyered] I sure hope not.
- Investors in alleged real estate scam sue the lawyers. [NY Law Journal/law.com]
Experts & Science
- John Day points his readers to a recent Missouri ruling allowing experts to testify in a res ipsa infection case. [Day on Torts]
Trials, Settlements & Other Ends
- Jury awards $500,000 against Cohen Milstein for legal malpractice. [Legal Times/law.com]
- Plame can't sue the government officials who allegedly revealed her secret identity. [ABA Journal, Denniston/SCOTUS Blog]
- Landlord who wouldn't rent to a family because of lead paint must pay $4,000. [LegalNewsline]
- Texas Plaintiffs suing over bone-building drugs Aredia and Zometa are preempted. [Prince/Products Liability Prof Blog]
- PA woman wins $2.78 million in med mal verdict for "chronic and excruciating pain" following an attempt to remove contraceptive implant rods and "unnecessary" neck surgery. [Delco Times]
- Saudis can't be sued in 9/11 suit [WSJ Law Blog]
- Summary judgment in favor of Honda was reversed by the Sixth Circuit because the consumer expectations test applies to air bags. [Prince/Products Liability Prof Blog]
- Wyeth v. Levine [WSJ, Burch/Mass Tort Lit Blog]
- Kentucky volunteer fire departments could lose the benefit of sovereign immunity. [Kentucky.com]
- USSC declines to decide the dispute over post-judgment interest on the punies award, but directs the Ninth Circuit to resolve it. [Cal Punitive Damages]
- CT Supreme Court reduced damages in worker's comp case because of claimant's smoking. [Conn. Law Tribue/law.com]
- More controversy on West Virginia Governor Joe Manchin III's decision to file an amicus brief with W.Va. Supreme Court in punitive damages appeal. [NY Times, Cal Punitive Damages]
- A jury in Utah has awarded punies of 16 times a substantial compensatory award; expect an appeal. [Cal Punitive Damages]
- Apparently a Dallas trial lawyer paid the monthly rent for John Edwards's former mistress to relocate. [ABA Journal stories here and here, Overlawyered]
- Health care costs to rise by 10% in 2009. [WaPo, HealthLawProf Blog]
- The Pop Tort has a mini-roundup of potential medical malpractice here.
- Should companies have to disclose the estimated costs of all continuing litigation? [Slater/WSJ Law Blog]
- Is cheating on a spouse relevant in a p.i. case? [Miller/Maryland Injury Lawyer Blog]
- Legaline interview with Gerry Spence [LegalTalkNetwork]
- A flight attendant is suing Victoria Osteen, wife of television evangelist Joel Osteen, for an alleged scuffle during a 2005 flight. I have no opinion as to the assault and battery aspects of the case. The "goofy" tag applies to the plaintiff's claim that she lost her faith based on the incident. [ABC News]
Shameless Self-Promotion (favorite posts of this week)
- Chris: O'Connell and Robinette Publish New Book on Tort Reform (Now that's shameless!)
- Bill: Lawyers & the presidential election
Thanks to: Bob Ambrogi
Thursday, August 14, 2008
There's a proposal by the Financial Accounting Standards Board to require publicly-traded companies to disclose "estimated costs" of pending litigation. As you can imagine, this is causing some angst among those companies with significant but hard-to-predict exposure who predict that the information would be mostly of use to plaintiffs' lawyers, less so for investors. The WSJ Law Blog has more; Point of Law has been covering it a lot too.
Rick Swedloff (Rutgers-Camden) has posted Can't Settle, Can't Sue: How Congress Stole Tort Remedies from Medicare Beneficiaries on SSRN. Here is the abstract:
In 2003, with no debate, Congress amended the Medicare Secondary Payer Act (the "MSP") to make it all but impossible for Medicare beneficiaries to participate in the settlement of individual or mass tort claims. Under this new Rule, the Secretary of Health and Human Services has the right to collect any money that Medicare expended on a beneficiary's healthcare needs from a settling tort defendant, even if the defendant denies liability; from a settling Medicare beneficiary, even if the settlement does not reflect medical payments; or from the settlement proceeds, even if those proceeds are distributed to a contingency fee attorney.
This article provides the first scholarly treatment of this startling barrier to civil settlements. Tracing the historical roots of Medicare and the Secondary Payer Act, I explore why Congress passed the 2003 amendment and, using an economic model of litigation, demonstrate the potentially disastrous impact the new Rule may have on the tort system. As I show, Medicare beneficiaries now have less incentive to bring and settle individual tort suits and contingency fee attorneys are unlikely to include Medicare beneficiaries as clients in individual or mass tort suits. Where Medicare beneficiaries make up a significant percentage of claimants in mass tort litigation, plaintiffs' attorneys may shy away from bringing mass tort claims altogether.
The new Medicare regime thus undermines the deterrence and corrective functions of the tort law, with little gained in return. Although Congress passed the amendment as a cost-recovery mechanism for Medicare, it may have the perverse effect of making it more difficult for the Secretary to recover Medicare's conditional outlays. If Medicare beneficiaries do not bring and settle tort claims, defendants will have no obligation to repay Medicare under the amendment and the Secretary will have no settlements to plunder. Further, without tort lawsuits, the Secretary may be deprived of valuable information about alleged tortfeasors, thus making it more difficult to bring subrogation claims.
Wednesday, August 13, 2008
Jeffrey O'Connell (Virginia) and TortsProf's Chris Robinette (Widener) have just published A Recipe for Balanced Tort Reform - Early Offers with Swift Settlements:
This book begins with detailed and evocative accounts of the workings of several actual personal injury cases with all their turbulence and tribulations. It then closely analyzes the (one-sided) tort reforms, both proposed and enacted, that leave too much of the present dysfunctional system intact, while even further undermining it. The authors provide a detailed account of a proposed reform: a device for encouraging defendants’ “Early Offers” of claimants’ economic losses designed to benefit both sides as well as society generally. This system, while greatly lessening the daunting uncertainty and delay plaguing personal injury claims today, would also make far better use of the resources that are expended. The book ends with an economic analysis documenting the dramatic savings in time and money from the early offers reform, exemplified in medical malpractice and product liability cases.
On Sunday, August 10th, Massachusetts Governor Deval Patrick signed Senate Bill 2863, which requires the Massachusetts Department of Public Health to establish a marketing code of conduct for prescription drugs and medical devices. The law takes effect January 1, 2009. FDA Law Blog and Drug & Device Law provide a thorough analysis of the new law.
Tuesday, August 12, 2008
Monday, August 11, 2008
Interesting piece in Forbes, noting first the easy theme (lots more lawyer money to Obama than McCain), but also observing that it's slightly more complicated (much of the lawyer money comes from
defense firms lawyers who work at predominantly defense firms). The bottom line of the story is a view that anything sought by the tort reform lobby is unlikely to be successful in at least the next couple of years. Worth a read.