April 21, 2012
Iqbal as Applied to Asbestos
Judge Stephen W. Wilson of the U.S. District Court for the Central District of California has issued what may be the first order following Iqbal in an asbestos case: Download Order (Mtn to Dismiss Ps' Complaint) 4-17-12.
Thanks to Cary Sklaren for the tip.
April 19, 2012
Gifford on Constitutional Constraints on Mass Tort Law
Don Gifford (Maryland) has posted to SSRN The Constitutional Bounding of Adjudication: A Fuller(ian) Explanation for the Supreme Court's Mass Tort Jurisprudence. The abstract provides:
In this Article, I argue that the Supreme Court is implicitly piecing together a constitutionally mandated model of bounded adjudication governing mass torts, using decisions that facially rest on disparate constitutional provisions. This model constitutionally restricts common law courts from adjudicating the rights, liabilities, and interests of persons who are neither present before the court nor capable of being defined with a reasonable degree of specificity. I find evidence for this model in the Court’s separate decisions rejecting tort-based climate change claims, global settlements of massive asbestos litigation, and punitive damages awards justified as extra-compensatory damages. These new forms of tort litigation echoed the public law models of Abram Chayes and Owen Fiss that, a generation ago, described public interest litigation in areas such as civil rights. In rejecting public law tort litigation, the Court constitutionally imposes a more traditional model of adjudication, a model advocated by mid-twentieth century legal philosopher Lon Fuller but regarded as archaic by most contemporary scholars. I then evaluate the Court’s model on the basis of factors including the limits of judicial competence, the need to legitimize the judicial role in a democracy, and the related impact of constitutional separation of powers. I weigh these factors against arguments that unbounded adjudication is necessary both to compensate mass torts victims who otherwise would be denied recovery and to regulate corporate misconduct in the face of regulatory dysfunction. I conclude that a presumptive model of bounded adjudication would restrain unprincipled adjudication without imposing an institutional straightjacket.
(Via Solum/Legal Theory Blog)
9th Circuit Preemption Case of Interest
On Monday, the Ninth Circuit issued its decision in Stengel v. Medtronic, Inc., No. 10-17755, slip op. [pdf]. The case involved a Medtronic pain-pump that the plaintiff alleged caused his paraplegia. The Ninth Circuit upheld dismissal based on Reigel v. Medtronic, Inc., 552 U.S. 312 (2008), and also denied plaintiffs' "failure to report" claim under implied preemption.
April 18, 2012
In Support of New Hampshire's Early Offers Bill
New Hampshire has proposed an early offers regime for medical malpractice cases. It passed the Senate and will be up for a vote in the House shortly. Pursuant to the bill, a patient who believes she is the victim of malpractice may send a notice of injury to the heath care provider requesting an early offer. The provider has 90 days to decide to extend an early offer and can ask the patient to undergo a physical exam. If extended, the offer must cover all economic loss—medical bills and lost wages. There are modest amounts of pain and suffering damages included based on classification of the injury as determined using the National Practitioner Data Bank severity scale. The patient then has 60 days to accept or reject the early offer. If she accepts the offer, the case is over. However, if she rejects the offer, she must prove gross negligence to a clear-and-convincing standard in order to recover.
The bill is based on a proposal authored by Jeffrey O’Connell, with the change of allowing the claimant, not the health care provider, to initiate the early offer process. I endorse the change and support the bill, though a similar system could be implemented without legislation. Criticism of the bill has come from the perspective of claimants. I’ll try to address specific points shortly, but I want to start with the general proposition that my support for the bill is largely based on its advantages for claimants. There are other potential benefits—savings, etc.—but they are not the chief reason I support early offers.
Early offers allows, but does not force, a claimant to bypass the tort system. Tort law has virtues, but among them are not certainty and swiftness. Because of an understandable focus on individual justice, the tort system can be very uncertain and slow, with significant transaction costs. There are many claimants who would prefer to have their claims resolved along insurance principles—with more certain payment for economic loss, taking care of the their urgent needs. I have sat at the hospital bed of a catastrophically injured loved one. After his health, my main concern was that he not be bankrupted by the enormous costs of life-saving care.
Some claimants have the resources to wait out a five-year malpractice struggle. Some claimants may enjoy the adversarial proceedings of depositions, interrogatories, and cross examinations. But all do not, and early offers gives them a possible way around them, while providing for basic economic loss much more swiftly. What follows are some objections to early offers I’ve seen in various columns and posts. I try to respond to each.
1. Early offers will incentive “low-ball” offers.
This is the objection I see the most, and it is ambiguous. I’m not sure if the writers mean the health care provider will try to offer less than allowed pursuant to the early offer bill or the offer will be lower than is available pursuant to tort law. If the former, the response is that any offer less than full economic loss, plus the modest pain and suffering award, does not qualify as an early offer. If the latter, the response is that it is true the offer is less than would be theoretically available pursuant to tort law, but it is swifter and more certain. That is the trade-off.
2. Only economic loss is available.
The latter version of the first objection blends into this objection. Some writers add that early offers would be unfair to claimants who did not have a lot of medical bills or lost wages; regarding lost wages, this would be particularly true of children, those who are retired, and those who do not work outside the home. The response to this point is that early offers may not be beneficial for everyone. If the claimant does not have a lot of economic loss, there may not be a pressing need for a financial recovery. Under such conditions, the claimant may decide the better course is to pursue a tort claim. Although, it may be significant to claimants who do not work outside the home that “replacement services” are available as economic loss.
3. Claimants will be suckered into signing up for the early offer.
The concern here is that claimants will be duped into accepting an early offer and waiving their tort rights by health care providers. One writer asked why a warning was not required. The response is that a waiver and warning are required. Every claimant, before initiating the early offers process, must sign a waiver that informs the claimant that legal rights, including the right to a jury trial, may be affected; that there is a right to consult an attorney (who will be paid by the health care provider in the event of an accepted early offer); that the claimant is free to pursue a tort claim if no early offer is made, along with other pieces of information. The following language is also included:
I UNDERSTAND THAT WHEN I SUBMIT A NOTICE OF INJURY AND SUBSEQUENTLY RECEIVE AN EARLY OFFER, I WILL HAVE RELINQUISHED MY RIGHT TO SUE FOR ORDINARY NEGLIGENCE, BREACH OF CONTRACT OR WARRANTY OR ANY OTHER CLAIM CONNECTED TO THE INJURY DESCRIBED IN THE NOTICE OF CLAIM. Moreover, if a claimant who submits a notice is not represented by counsel, the health care provider must provide a neutral mediator, at the health care provider’s expense, to offer assistance to the claimant.
4. Health care providers can already make offers to settle.
This is true, but they often do so slowly, as is obvious from the average length of malpractice cases. The reason is that both sides have incentives to posture throughout the process of resolving the dispute. By offering health care providers the incentive of the higher standard and lower transaction costs, more offers will be made and much more quickly.
5. Early offers would shift the costs of caring for the injured from the wrongdoers to state and local government.
Costs of care are economic losses, which are, by definition, covered by early offers. The danger of shifting costs to the government is much more concrete if the claimant loses a tort case.
There are two objections that concern me a little more, but I think these risks are acceptable given the potential benefits:
6. Discovery is one-sided.
My friend Alberto Bernabe points out that the health care provider is able to obtain discovery before the claimant. It is necessary that a health care provider perform discovery prior to making an early offer. If the claimant wants the potential benefits of the early offer, she will have to make the choice to submit to discovery. However, the outcome and any other writings, evidence, or statements made or offered by a party or party’s representative during negotiations of an early offer are not admissible in court. A health care provider could also potentially be required to release all medical records to the claimant at the time of the early offer negotiations.
7. Disputes are resolved by the Department of Insurance.
The most common type of dispute would likely be whether an item counts as economic loss. Although there may be hard cases, calculation of economic loss is one of the simpler issues in a tort case. The main objection seems to be that the Department of Insurance in New Hampshire is financed by insurers. I have not heard any direct claims that the Department is biased, and I have no reason to think it is, but a neutral arbiter is crucial to the process.
Many of the objections seem to implicitly contrast early offers with an idealized tort system. There is much to admire in tort law, but it is far from perfect. The alternative to early offers is not recovery in every case in which it is deserved, with the exactly proper amount of pain and suffering damages, within a reasonable amount of time, and at an efficient cost. Instead, recent studies show that one in six cases involving legitimate medical error received no payment and, for those that did, 54 cents out of every dollar went to pay the costs of operating the system. The average malpractice case lasts approximately five years; New Hampshire’s system is a little quicker (about four years). However, that is a long time to wait when medical bills and lost wages accrue. Moreover, approximately 80% of malpractice trials nationally are won by health care providers; the New Hampshire figure is approximately 65%. Although claimants with minor injuries often receive several times their economic loss, claimants with major injuries may not even recover the full amount of economic loss. Why not provide claimants an alternative? If a claimant, for whatever reason, prefers the tort system, it is still available.
April 17, 2012
2012 Clifford Symposium at DePaul Focuses on Marc Galanter
The 2012 Clifford Symposium on Tort Law and Social Policy, "A Celebration of the Thought of Marc Galanter," will take place on April 26 and 27 at DePaul University College of Law. As always, the symposium is chaired by Stephan Landsman.
Thanks to Alberto Bernabe for the tip.
April 15, 2012
Sharkey on Preemption and the Administrative Process
Cathy Sharkey (NYU) has posted to SSRN Preemption as a Judicial End-Run Around the Administrative Process?. The abstract provides:
Judicial review of agency action under the Administrative Procedure Act (APA) and preemption challenges provide parallel proceedings for resolution of disputes over whether state and federal law are simpatico or at war. Douglas v. Independent Living Center of Southern California, Inc., provides an opportunity to reflect upon the coexistence of, and relationship between, these parallel tracks for adjudicating federal-state conflicts. Who is, and who should be, the ultimate arbiter of whether such federal-state conflicts exist and how to resolve them — agencies or courts?
In this Essay, I used Douglas as a lens through which to explore two concepts: first, whether courts can act as “prompters,” pushing federal agencies to discharge their duty to weigh in on whether a conflict between federal and state law exists in a given context; and second, whether there can exist a synergistic relationship between courts and agencies in determining whether a conflict between federal and state law exists. Specifically, I explore two questions left unresolved by the Court’s Douglas decision: (1) Why permit a preemption cause of action at all in situations where there is a viable administrative action? And (2) where parallel proceedings persist, should agency determinations receive varying degrees of deference in each?