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Southwestern Law School

Monday, October 19, 2015

Baker on the Alienability of Mass Tort Claims

Lynn Baker has posted to SSRN Alienability of Mass Tort Claims.  The abstract provides:

This Article was prepared for the 19th Annual Clifford Symposium on Tort Law and Social Policy, "A Brave New World: The Changing Face of Litigation and Law Firm Finance."  It seeks to contribute to the larger conversation about whether the United States should permit innovative forms of litigation financing for personal injury claims by examining a hypothetical regime with expanded alienability of mass tort personal injury claims.  The Article focuses on this subset of claims because arguments in favor of complete alienability of personal injury claims are strongest with regard to these claims, and many of the staunchest critics of alternative litigation financing have expressed particular concern about its implications in the mass tort context.  Thus, those not persuaded by the Article's analysis are unlikely to be persuaded by arguments for expanding the alienability of personal injury claims more generally.

The Article begins by describing the current state of affairs for both clients and their lawyers regarding the alienability and prosecution of mass tort personal injury claims. Despite various longstanding restrictions on the alienability of personal injury claims in the United States, substantial alienability of these claims is permitted and is engaged in by both clients and their attorneys.  Part II discusses the aspects of the prosecution of mass tort claims in the United States that make these claims especially good candidates for complete alienability.

Part III discusses the benefits and costs to mass tort claimants and their attorneys of a hypothetical regime under which a claimant could sell her entire claim to a law firm, rather than retain the firm to serve as her counsel on a contingent fee basis.  This Part also discusses various practical issues that would need to be resolved before a claim-sale option for mass tort personal injury claims could become a reality.  Part IV goes on to analyze the normative concerns that underlie the existing constraints on claim sales.  It reveals that none of these concerns is a persuasive grounds for prohibiting mass tort claimants from selling their claims to an attorney (or, perhaps, to any other potential purchaser).

It is not at all clear that a market for mass tort personal injury claims would flourish even if the existing ethical and legal constraints were relaxed.  But that possibility does not diminish the importance of the Article's larger conclusion that there are no compelling normative or economic reasons to prohibit the complete alienability of mass tort personal injury claims in the United States.

https://lawprofessors.typepad.com/tortsprof/2015/10/baker-on-the-alienability-of-mass-tort-claims.html

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