Mass Tort Litigation Blog

Sebok on Alienation of Claims

Tony Sebok (Cardozo) has posted his piece "The Inauthentic Claim" to SSRN.  This is a very important paper arguing against the usual rule limiting types of litigation financing.  The implications of the thesis for mass torts is significant.  If people could sell lawsuits the landscape of aggregate litigation would change in significant ways. Here is the abstract:

This Article argues that third parties should be able to invest in lawsuits to a much greater degree than is currently permitted in most jurisdictions in the United States. The laws of assignment and maintenance limit the freedom of litigants to sell all or part of their lawsuits to strangers. I argue in the Article that the foundation of both doctrines is based on something I call the theory of “the inauthentic claim.”

The theory of the inauthentic claim asserts that there is a quality, separate and in addition to legal validity, which confers “authenticity” to a lawsuit. It does not presuppose that “inauthentic” lawsuits are more likely to be spurious, fraudulent, or frivolous than “authentic” lawsuits. It holds, instead, that the mere fact that a third party involved him or herself in the suit for the wrong reasons (either by taking an assignment in the suit or supporting the suit), is proof that the suit is against public policy.

This Article examines two arguments that might be used to defend the theory of the inauthentic claim, one from history and one from jurisprudence. I conclude that neither argument is persuasive. I conclude the Article by sketching a research agenda based on empirical evidence that would help policymakers and judges choose the socially optimal set of rules for third party investment in litigation.

ADL

(h/t Chris Robinette at  Torts Prof Blog)

Panel on Pluralism in Tort Law and Litigation at Annual Conference of the Association for the Study of Law, Culture and the Humanities

As previously mentioned, I was part of a panel on Pluralism in Tort Law and Litigation at the annual conference of the Association for the Study of Law, Culture and the Humanities, which took place on Saturday, March 20 at Brown University.  Professor Alan Calnan (Southwestern) moderated the panel, and other participants included Professors Christopher Robinette (Widener) and Sheila Scheuerman (Charleston).  Below are the abstracts and links to audio from the presentations and Q&A.  Thanks to Alan Calnan for moderating and to all for participating.

***

I.  Prof. Alan Calnan -- Introduction (audio)

II.  Prof. Christopher Robinette -- "The Instrumentalism in Tort Reforms" (audio)

The traditional view among legal historians is that tort was largely deontic private law until the late nineteenth century.  Due to factors such as the Industrial Revolution and the advent of liability insurance, tort became (more) instrumentalist.  A survey of major tort reforms over the course of the last century provides evidence to support this view.  Each of the reforms--workers' compensation, no-fault automobile insurance, products liability, and "modern" tort reforms (such as damage caps)--is based in instrumentalism.  Furthermore, the reforms become increasingly integrated into tort law as time passed.  The earliest reform, workers' compensation, was a substitute for tort law.  By the time of the modern reforms, instrumentalism is operating within tort itself, and covers a multitude of tort cases.

III.  Prof. Byron Stier -- ""Examining Litigant Autonomy in Mass Torts: Insights from the Individualism of Ayn Rand" (audio)

Class actions and other aggregate procedural methods raise questions about the relationship of the individual to the group.  Litigant autonomy -- the litigant's interest in controlling his or her lawsuit -- has generally been considered merely one value among others in mass tort litigation, and only recently has a robust commitment to litigant autonomy been seen to call into question the entire structure of class action practice.  In looking for insight into the proper place for litigant autonomy in class actions or other management methods, we might fruitfully turn to political debates concerning the relationship of the citizen to the state, for both settings examine the rights of the individual against the perceived needs of the group or collective.  For discussion of that political question, I look to an unusual source -- outside law, to the literature of one known for her radical political individualism, Ayn Rand.  Her novel, "We The Living," which was published in 1936 and is set in the aftermath of the communist revolution in Russia, puts forth a moral argument for individualism stemming from the sanctity of one's own life, and of one's control of one's own life, for one's own ends, not the group's; she also argues that personal tragedy and systemic corruption accompany an approach that fails to respect individuals' lives and choices.  Turning back to mass tort litigation, I suggest that our notion of litigant autonomy can be informed by Rand's themes and that current class action rules show flaws similar to the collectivism that Rand critiques. Viewing litigant autonomy not merely as one value among others, but instead as an organizing principle that must be respected as a core right, I suggest that current class action rules regarding notice, opt-out, and settlement are problematic because they do not allow adequate expression of individual preference and they blunt each class member's individuality.  In addition, by avoiding individual control, the current class action rules create fertile ground for corruption and collusive settlements.

IV.  Prof. Sheila Scheuerman (audio)

In my presentation, I examine whether and when tort law should permit
"no injury" claims -- claims where the plaintiff's harm has not yet
materialized.  Examples of these suits include medical monitoring
actions, products liability claims where a known defect exists, but the
product has not yet malfunctioned, as well as consumer fraud claims
where the consumer's decision was not affected by the defendant's
alleged misrepresentation.  Recent years have seen an influx of these
suits under an array of tort and contract theories.  Traditionally,
however, tort doctrine has premised liability on an injury to an
identified party.  But is "injury" a necessary pre-requisite?  I address
whether tort values support these "no injury" causes of action.  In
other words, should "no injury" claims be actionable under the varied
rationales for the tort system and, if so, under what circumstances?

V.  Questions and Answers (audio)

***

BGS

Reynolds' Move Into Smokeless Products

Thorough article in the Wall Street Journal -- Smokeless Products Are Tough Test for Reynolds, by David Kesmodel.

BGS

Georgia High Court Strikes Down Damages Caps in MedMal Cases

The NYTimes coverage is here.

ADL

Albany Law Journal Symposium Issue on Off-Label Drug Prescription

The Albany Law Journal of Science & Technology has published a symposium issue on Regulating the Cure: Topics Arising Out of the Prescription of Drugs Off-Label.  My article, Promotion of Off-Label Drug Use: In Favor of a Regulatory Retreat, 19 Alb. L.J. Sci & Tec. 609 (2009), is included.

BGS

Walter Olson Attempts to Defuse the Toyota Panic

His article, Exorcising Toyota’s Demons, was published today in the National Review online.

BGS

SCOTUS Accepts Vaccine Preemption Case

BNA Law Week reports:

Bruesewitz v. Wyeth, No. 09-152. Does Section 22(b)(1) of the 1986 National Childhood Vaccine Injury Act, which states that "[n]o vaccine manufacturer shall be liable in a civil action for damages arising from a vaccine-related injury or death associated with the administration of a vaccine ... if the injury or death resulted from side effects that were unavoidable even though the vaccine was properly prepared and was accompanied by proper directions and warnings," preempt all vaccine design defect claims, whether based on strict liability or negligence?

ADL

Array of Lawsuits Expected Against Toyota

Professor David Owen (South Carolina) and I are quoted in a report tonight on All Things Considered on National Public Radio; the audio report -- Toyota Seen Facing Multiple Lawsuits, by Wendy Kaufman -- will also be posted on the web tonight at 7:00 p.m. EST.

BGS

Abraham on the Four Conceptions of Insurance

Kenneth Abraham has an enlightening guest post on TortsProf Blog called "Four Conceptions of Insurance."  The relationship between the tort system and insurance systems is fascinating and important. More work needs to be done in this area.

ADL

Update on Collective Redress in England and Wales

Back in November of 2008, England and Wales asked Lord Justice Jackson to review civil litigation costs and how those costs affected access to justice.  He recently issued his final report (a hefty 584 pages).  BBC News calls the report a "radical plan[ ] to shake up costs of civil cases."  Here's an excerpt of the story:

Lord Justice Jackson's Review of Civil Litigation Costs is a result of a recognition that it is simply too expensive for many people and small companies to bring or defend civil cases.

"What I want to do is to focus the system so less money is paid to intermediaries and others in the process, and more money is paid to victims," he told the BBC.

"I am concerned about individuals, small businesses and others who need to use the courts."

His proposals are radical. He has looked at the factors forcing costs up in civil actions, and in particular he has focussed on Conditional Fee Agreements (CFAs), more commonly known as "no win, no fee" agreements.

Despite BBC's headline, the final report was ultimately less radical than the preliminary one, which leaned toward abolishing England's cost-shifting "loser pays" rule.  The final report concludes that cost shifting should remain the norm (even in collective actions), but excepts personal injury claims from the norm.  Whether personal injury claims are brought individually or collectively, the final report recommends "qualified one-way costs shifting" where winning claimants could recover their costs from the defendant, but generally do not have to pay the defendant's costs if they lose.

Of additional import, the final report recommends that solicitors and barristers should be allowed to enter into contingency fee arrangements, which are currently prohibited.  Before entering into such an arrangement, the report recommends that claimants receive independent advice.  It also suggests capping the fees at 25%.

Finally, the report recommends making third-party funding available to personal injury claimants (including those involved in collective actions).  It defines third party funding as "The funding of litigation by a party who has no pre-existing interest in the litigation, usually on the basis that (i) the funder will be paid out of the proceeds of any amounts recovered as a consequence of the litigation, often as a percentage of the recovery sum; and (ii) the funder is not entitled to payment should the claim fail."  (Final Report at p. 17).  Very interesting.

For additional commentary on the report, here are links to Lovells, the UK's Financial Times, and BBC News.  Whether the suggested reforms will be implemented remains to be seen.

ECB

Cadmium Warning (Children's Jewelry)

The Associated Press is reporting a study that demonstrated that there are alarming percentages of the heavy metal Cadmium, which among other things causes cancer, in certain inexpensive children's jewelry (particularly charm bracelets).  Some of the jewelry was sold at Wal-Mart and Claire's (a ubiquitous accessory chain here on the East Coast that many parents will be familiar with). 

The article from the AP is available here. 

It seems that if its not one dangerous substance (lead) its another (cadmium).  This underscores the importance of regulating consumer goods, especially children's toys and jewelry.  Trying to compensate parents after the fact for the damages caused by exposure to carcinogens, while important, will never be as good as preventing the damage in the first place.

ADL

Increase in Black Lung Disease

Today's Wall Street Journal has an article on increases in Black Lung Disease, Black Lung on Rise in Mines, Reversing Trend, by Kris Maher.  Black Lung claims are covered by a federal Black Lung program, which provides an administrative mechanism for compensation, funded by a tax on coal.  What's interesting is that the rise in claims occurs despite improving technology, which would be expected to decrease health problems.  Thus, the article explores possible causes, such as longer workshifts or more productive machinery that might produce more dust.  If machinery is the culprit, it's possible that individual mining companies might have had an incentive to prioritize powerful machinery over safe machinery, if the costs of worker illness are spread throughout the entire industry via a coal tax.  (Remedy: return to a system of individual tort claims against mining companies, or at least some administrative/tax penalty for companies with higher Black Lung claims.) 

But one other possibility for the rise in Black Lung needs to at least be considered and explored: fraud. Recent events with silicosis are similar: historically falling disease rates in tandem with improving technology, followed by an odd spike in supposed disease incidence.  In a now-storied Daubert inquiry, Judge Janis Jack, who herself had a background in nursing, inquired into the basis of expert testimony and diagnosis and uncovered biased and unreliable procedures that may amount to fraud; her discoveries effectively ended what appeared to be a new mass tort.  See NPR, Silicosis Ruling Could Revamp Legal Landscape.  Concerns of fraud and abuse should be even greater in the context of an administrative program that lacks the adversarial scrutiny of formal litigation.  And the Black Lung program has historically been plagued by such problems.  A 1989 article in the West Virginia Law Review, authored by a former Department of Labor counsel and a private practitioner, concluded,

[T]he program has been plagued by fraud and abuse. There have been investigations, and indictments, and convictions of agency personnel, claimant's representatives, and medical care providers.  The program has been infected by an undercurrent of “petty corruption.”  If anything, the program is the most often cited example of why Congress should leave occupational disease compensation to the individual states.

Allen R. Prunty & Mark E. Solomons, The Federal Black Lung Program: Its Evolution and Current Issues, 91 W. Va. L. Rev. 665, 734 (1989). 

BGS

WLF Web Seminar on Off-Label Communication

On October 14, 2009, the Washington Legal Foundation hosted a web seminar, Communicating on Off-Label Treatments: Navigating the Treacherous Path Paved by Civil and Criminal Law Enforcement, with speakers Robert Salerno and Adam Hoffinger of Morrison & Foerster.  Streaming video of the event is available online.

BGS

Fall 2009 Newsletter for ABA Mass Torts Litigation Committee

The newsletter is now available and includes articles on Lone Pine orders, public nuisance law, federal preemption, sophisticated user and sophisticated intermediary defenses, the Fake Bad Scale Test, and document review.

BGS