ThePopTort

ALEC and Tort Reform – Whole Lotta Protesting Goin’ On!

I realize that there’s much to be angry about these days so I’m always looking for fun ways to channel the rage, and I think I found one!  How about protesting some Fat Cats in Fat City?  By Fat Cats, we mean the political horror show known as the annual summit of the American Legislative Exchange Council.  ALEC is the national secret organization of conservative state lawmakers and major corporations that writes bills for states and tells them what to do.  Their annual festivities are taking place right now at the French Quarter Marriot in New Orleans!   Find out all you need to know here and let the good times roll (or as they say, laissez le bon temp rouler)! 

You may have read recently that the Center for Media and Democracy got ahold of and released hundreds of previously secret legislative bills written by ALEC.  As Common Cause notes in a report about ALEC released today,

led by such firms as Wal-Mart, Coca-Cola, Koch Industries, AT&T, Altria and ExxonMobil, the American Legislative Exchange Council has quietly made itself a force in all 50 state capitols.  The 22 companies that make up ALEC's "private enterprise board," their executives and affiliated political action committees, put more than $38 million into state elections in the 2009-10 election cycle and have invested more than $370 million in state politics since 2001, according to the report, Money, Power and the American Legislative Exchange Council. 

The Center for Media and Democracy calls ALEC “little more than a bill factory for corporate-friendly legislation that often repeals people’s rights or fattens the corporate bottom line.”  To wit, a big focus for ALEC has always been limiting the liability of its corporate members, so-called “tort reform.” In fact, last year, the Center for Justice & Democracy published a whole study all about this.

So we thought it might be a good idea to dig down into both the CMD and CJ&D efforts and figure out what both organizations observed might be priority “tort reform” areas for states these days.  Here are a few:

 Comparative Fault Act
This bill changes the law in most states by preventing an injured person from recovering anything if his or her fault “exceeds that of the defendants and nonparties.”  Right now, judges and juries decide compensation based on the amount someone is at fault, if at all.  This bill takes away the jury’s power and could result in the very harsh result of an injured person receiving nothing, even though a defendant’s misconduct contributes substantially to the injury.

Class Actions Improvement Act
Rather than improving the right to bring class action lawsuits, this “improvement” bill would severely limit them by limiting where they could be brought and giving the defendant new rights to appeal class-action certification.

Private Enforcement of Consumer Protection Statutes
This bill takes  away a consumer’s incentive to bring a lawsuit when state consumer laws are broken. 

Noneconomic Damage Awards Act
This bill limits all noneconomic damage awards to “$250,000 or the amount awarded in economic damages, whichever amount is greater.”  See more about the impact of such caps here.

Punitive Damages Standards Act
This bill makes it much more difficult for injured plaintiffs to receive punitive damages, which are only awarded in cases of egregious misconduct. 

Legal Consumer’s Bill of Rights Act and The Honesty in Lawyering Act
Despite their names, these bills are ways for ALEC and its corporate supporters to overburden lawyers who represent injured consumers. 

Notice Opportunity to Repair Act
This bill would place a bunch of obstacles in the way of a homeowner whose contractor’s negligence causes construction defects. 

Regulatory Compliance Congruity with Liability Act
This legislation would immunize corporations for liability for wrongdoing as long as they comply with minimal government standards.

Discovery of Electronically Stored Information and Limitations on Waiver of Attorney Client Work Product (no link available)
This bill just makes it harder to lawyers to do their jobs on behalf of consumers.

Summary Judgment Procedure Act
This bill would place new burdens on judges who deny a corporate wrongdoer’s motion to dismiss a case under “summary judgment.”

If you can make it down to the great city of New Orleans this Friday, or if you happen to already be there, this should be one hoot of a time!

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The Courts Are Actively Ruling on Katrina Cases (In Case Anyone's Paying Attention)

Who here remembers Comedy Central’s early 90’s John Stewart-hosted show, Short Attention Span Theater?  No, me neither, but I can think of a few issues today that would make great segments.

A few days ago, we featured a piece from Countdown with Keith Olbermann about BP’s courtroom delay tactics that, as he puts it, “buys them time for the public to forget.”  Given our Short Attention Span, who doesn’t think “forgetting” is virtually a guarantee? 

In fact, unless you live in the Gulf, the continuing devastation caused by BP has pushed the continuing devastation caused by Hurricane Katrina off the front pages and cable news shows (except for the recent five-year anniversary and Spike Lee).

So today, we thought we’d bring you up to date on a few court cases from the storm that are still winding through the courts, and that reached important milestones this week.

First, “residents and property owners suing Jefferson Parish, former Parish President Aaron Broussard and his administration over widespread flooding in the wake of Hurricane Katrina scored a victory Wednesday when they were granted class-action status in the 24th Judicial District Court in Gretna.”

The lawsuits “blame the flood damage on a decision within Broussard's administration to evacuate 220 pump operators to Washington Parish as the major storm approached the Gulf Coast.”  It should be noted that  “Broussard testified in November 2007 that he did not deliver the order to evacuate the pump operators and told the court that he was ignorant of a ‘doomsday plan’ that called for such a decision.” We’ll see what happens.

Meanwhile, “a federal judge has thrown out nearly all constitutional claims in a lawsuit against Gretna and Jefferson Parish law enforcement agencies for their controversial decision to block stranded people from walking across the Crescent City Connection to the West Bank after Hurricane Katrina.… Several lawsuits related to the bridge blockade remain in New Orleans Civil District Court.”

Also, the Louisiana Supreme Court has “upheld a lower-court ruling tossing out Louisiana Citizens Property Insurance Corp.’s $35 million settlement of a class action suit because the deal was unfair to some policyholders.”  The lawsuits “stemmed from delays in adjusting and settling claims from hurricanes Katrina and Rita.… In its 33-page decision issued Friday, the Supreme Court ruled that Citizens erred in settling one lawsuit and then claiming that agreement covered the plaintiffs in another class action lawsuit.”

And finally, “a three-judge panel of the U.S. 5th Circuit Court of Appeals ruled Tuesday that an Army Corps of Engineers contractor was not entitled to immunity from being sued for its actions in removing debris on the east bank of the Industrial Canal next to a section of floodwall that failed during Hurricane Katrina. The decision means that the lawsuit filed against Boise, Idaho-based Washington Group International Inc. engineering and construction firm by flood victims in the Lower 9th Ward, eastern New Orleans and St. Bernard Parish returns to the courtroom of U.S. District Judge Stanwood Duval for further action.”

We'll keep an eye out.

 

B is for Bastards and Other Hot News

Lots of interesting non-election stuff in the news, too!  Here’s a little review:

Reuters reports, “A new survey of primary care practices in North Carolina shows nearly one in six patients believed their physician had made a wrong diagnosis or a treatment error, and about one in seven said they had changed doctor as a result.… [E]ight percent said they had experienced ‘a lot’ or ‘severe’ harm from the perceived mistake in care."

Meanwhile, a new study by Carnegie Mellon University researchers found that “telling physicians they shouldn't accept gifts from drug companies is all well and good.  But convincing them that doing so is wrong is another matter... [P]hysicians rationalize such gifts as payback for all the sacrifices they made to get their education -- although they may not realize they're doing it.  The attitude, the researchers said, is one of ‘because I'm worth it.’” 

Here’s another thing some docs may think they’re entitled to do: branding body parts. Smoking Gun reports, “After performing a hysterectomy last year, a California gynecologist used a cauterizing tool to brand his patient’s name on her removed uterus, an unorthodox move that the doctor calls a ‘friendly gesture,’ but which the woman terms ‘despicable conduct’ in a medical negligence lawsuit.”

As for one of the medical establishment’s best “tort reform” allies, the tobacco industry, they’re having a good day thanks to Supreme Court Antonin Scalia, who granted their request to block “a state court order requiring tobacco companies to pay $270 million for a smoking cessation program in Louisiana.”  We’ll see what happens when the full court gets its hands on this case – a class action that the tobacco industry lost.

And now that we’re on the topic of doctors and tobacco, Texas Magistrate says that Texas' brutal, anti-patient tort reform law, which “capped medical liability for non-economic damages at $250,000, doesn't violate victims' constitutional rights.”   Yeah, the business and medical lobbies took care of that by getting the constitution changed first. 

BP oil fund administrator Ken Feinberg has changed his tune on ruling that certain businesses are ineligible to submit claims based on “proximity.”  That may seem like a victory for some, but not so fast. Check out Olbermann’s Worst Person’s segment last night on MSNBC, skewering BP and its new chief executive, Bob Dudley, over their recent courtroom shenanigans.  Read, or watch, below:

BP's court filings say the fishermen, seafood processors, hotel owner, restaurateur, oyster farmers and the like must first apply to relief from the official BP compensation fund, that they must play that game of bureaucratic red tape before they can begin to sue. Even the lawyers are saying they should wait until next March before which test cases should proceed to trial and which should not. That's moving too fast for BP and now we know why.  BP agreed to the $20 billion fund. Because it buys them time for the public to forget, for the remaining oil to dissipate, for them to potentially lose internal memos and e-mails and text messages and other evidence of their culpability, and especially time for the victims to run out of money with which to pay their lawyers. Bob Dudley of BP, never did figure out what the P really stands for. But the B is clearly for bastards, today's worst person in the world.

Visit msnbc.com for breaking news, world news, and news about the economy

Trusting BP, Feinberg and “CYA” Reports

Really, who should be too surprised by BP’s internal report, released today, that “deflects attention away from BP and back onto its contractors" Transocean and Halliburton, and “tries to undermine the notion that the company acted with gross negligence”? It reflects the best corporate tradition of finger pointing, which began early on, and CYA (“cover your ass”) internal reviews.

(Although be careful, BP, because covering up wrongdoing with CYA reports can sometimes cause a heap of trouble, like after the Three Mile Island nuclear accident. See references to the Keaten Report. Interesting that BP’s site leaders, Donald Vidrine and Robert Kaluza, have never testified publicly or given interviews. )

The New York Times calls this report “a first glimpse at BP’s probable legal strategy in defending itself and it represents the first in a series of such reports in the coming months.” (Remember that the law’s paltry $75 million liability cap is waived if gross negligence is found.) Not that we don’t believe these other companies aren’t also responsible, like Transocean who is constantly trying to wiggle out of responsibility for this incident,  including the deaths of the 11 workers, most of whom worked for Transocean. CNN reports,  “The other companies involved have yet to give their version of events, and Transocean has pointedly complained that BP hasn’t turned over data that would help Transocean with its own internal investigation.” Can’t wait to hear what they have to say.

Meanwhile, the claims process for people in the Gulf couldn’t be more frustrating.  Ken Feinberg is running the program to divvy out $20 billion pledged by BP.  It’s hard to find anyone happy with his statements and actions so far. From delays and excuses (in the words of Lafitte shrimper William Lorenzo: "Can we take whoever programmed this system for the Gulf Coast Claims Facility, take them down to the swamp, drop them off for 10 days and let them wait on us to go pick them up to see how it feels to keep waiting") to his refusal to consider mental health claims, to blocking recovery for Florida’s devastated tourism business (“Some small hotels on scenic Marco Island, Fla., say they're on the verge of closing unless they receive checks from the $20 billion pot”  but Feinberg is unlikely to find them eligible anyway), it's a mess.  And there’s more here , here. 

Things are so bad that Florida’s Department of Children and Families Secretary George Sheldon, “who was one of the oil company’s harshest critics before Feinberg took over,” was forced to admit: “I never thought I’d say this but part of me would like BP back. What [Feinberg] articulated to all of us was something totally different than what’s in this protocol.” Meanwhile, Feinberg says “it was his idea, not BP's, to require that anyone who receives a final settlement from the $20 billion compensation fund give up the right to sue the oil giant” and “he has not yet decided whether the no-sue requirement will extend to other companies that may be responsible.” 

"It is not in your interest to tie up you and the courts in years of uncertain protracted litigation when there is an alternative that has been created," Feinberg said.

He added, "I take the position, if I don't find you eligible, no court will find you eligible."

Hmmm. How about we let the courts decide that?  Seems like given all the above, litigation will be absolutely necessary.

Judges Take (Corporate) Stock

You may have already heard that “six of 12 active judges assigned to the federal judicial district based in New Orleans already have removed themselves from spill-damage lawsuits” because of “conflicts tied to oil investments or personal relationships with lawyers or companies involved.”  The situation is so bad that one group of plaintiffs’ lawyers “has asked that a judge be brought in from outside the Gulf Coast to preside over the oil- spill litigation.” They have been told, “[M]ost or all of the judges in the district have a conflict and cannot preside.”

Bloomberg columnist Ann Woolner had a fascinating/disturbing analysis today showing what happens when judges come on the bench and don’t put their investments in blind trusts, or sell their shares “and put their money where they have no control over it.”

She writes,

Good news for BP Plc. and other oil, coal and chemical companies seeped out last week from New Orleans, barely noticed in the blanket coverage of the as-yet uncontrolled oil gusher in the Gulf of Mexico.… [The companies won a widely watched global warming lawsuit] because appellate judges with conflicts of interest, presumably because of stock ownership, stepped off the case. Without a quorum the judges couldn’t consider the case, so they dismissed it. The outrageous part is that three, un-conflicted judges on that same court had already ruled against the energy companies in the same case. But their opinion was nullified and is now dead, according to the court.”

(Here is more coverage of that case from the New York Times.) 

Woolner also mentions that the “U.S. Supreme Court had to give up on a case involving American corporate involvement in South Africa’s apartheid for lack of a quorum.  And the court’s ruling on damages for the Exxon Valdez spill turned out 4-4 on some issues because Justice Samuel Alito had shares in the company and stepped aside."

Meanwhile yesterday, Louisiana U.S. District Judge Carl Barbier apparently told his broker to sell his Transocean and Halliburton bonds.  But he says he didn’t really have to.  He explained, “the judicial code of conduct forbids federal judges from owning common stock in a corporation involved in any case that comes before them However, recusal is not required if the stock is part of a mutual fund unless the judge participates in the management of the fund.  Nor is recusal required because of ownership of debt instruments such as corporate debentures or bonds.”

The big problem here, writes Woolner, is that “Too many business cases get decided, not on the merits, but because judges own shares in companies that come before their courts.” Just when you thought corporate America couldn’t strangle our democracy any more than it already has.…

Huff Post Repost: America Wakes Up to the Importance of Liability and the Stupidity of “Caps”

Teachable moments can come almost anytime, from anywhere. The recent history of corporate and professional breakdowns and mess-ups should provide a number of them. Bob Herbert raised the issue in a stinging New York Times column recently when he asked, "Will we learn anything from this disaster ...?" BP was his focus but also on his mind was "how the giant financial firms almost destroyed the American economy" and the "devastating mine explosion in West Virginia -- at a mine run by a company with its own hideous safety record ..."

We'll add to that list the Toyota debacle, drug companies marketing contaminated childrens' medications, builders who pushed defective Chinese drywall into thousands of homes, Delaware doctors who covered-up a pedophile pediatrician who raped children, not to mention more and more dangerous hospitals everywhere. What a couple of months.

Keep reading.

Cases Move Forward in that Other Southeast U.S. Environmental Catastrophe – Chinese Drywall

The last time we covered the Chinese Drywall “hot mess," the Deepwater Horizon oilrig occupied nary a nanosecond of brain power for most people.  Of course, now our collective brains are hurting pretty badly over that.  Incredibly, what is happening in the Gulf is just the latest environmental calamity to hit the southeast recently– and I’m not even talking about hurricanes. 

We like to talk about Chinese Drywall because it highlights so very well the important role that civil courts and good trial lawyers play in getting not-so-easy-to-come-by justice for people.

Bloomberg reports that so far, over 2,100 people are plaintiffs in coordinated nationwide federal drywall litigation and the New Orleans judge overseeing it said that USG (“North America’s largest maker of gypsum wallboard”) and Germany’s Knauf Group "are among about 1,000 defendants” that may face claims.  That should help residents in their quest for justice and compensation.  He also said that “as many as 40,000 plaintiffs may bring claims,” which gives one a sense of the breadth of this problem.

And in Florida, a drywall case received the first-ever class action status.  It’s a smaller case, involving “152 families from three Homestead neighborhoods,” but a very important one.  A Miami New Times blogger put it quite well:

For the first time in the nation, a Miami judge this morning certified a class action lawsuit against distributors and manufacturers of the toxic drywall.

The class action suit is limited to a single subdivision in Homestead, but lawyers say the judge's decision could be an important precedent for thousands of other victims.

"Now that we've established the precedent that there is a defective product with a common source, we can start to expand on the victory," says Victor Diaz, the lawyer representing the Homestead couple who brought the lawsuit.

…

Diaz also sits on the steering committee of the large federal case seeking a class action suit, which sits in New Orleans' federal court. He says the Miami ruling -- issued by Circuit Court Judge Joseph Ferina -- could help the federal judge in Louisiana authorize a nationwide class-action.

"This was all about testing whether these cases could be brought on as a class-action and we won a big victory today," he says.

Hang in there, southeast!

BP and Law Clinics – One Spooky Interaction

Einstein once coined the excellent phrase "spooky action at a distance."  He was referring to the “action at a distance” theory in physics, the “interaction of two objects which are separated in space with no known mediator of the interaction.” Not that we have a clue as to what that means, but we agree with Einstein - sounds spooky!  It also suddenly reminded me of two stories we’ve covering lately, which suddenly came together, maybe in space, but certainly in Louisiana.

As if there aren’t more important things for them to worry about, last week  BP’s trade association, the Louisiana Chemical Association (LCA), tried to do what polluters in Maryland just tried and failed: to cut state funding from any school whose law clinic sues a government agency or business.  This dementedly misguided bill was directed at Tulane’s Environmental Law Clinic, the state’s only environmental law clinic, which “sometimes takes legal action against polluting companies and regulatory agencies.” Luckily, the bill was killed yesterday in the Louisiana State Senate - unaminously.

According to the Huffington Post, "in a letter sent to its 61 corporate members earlier in May, LCA president Dan Borne wrote:

This bill is the culmination of years of frustration with Tulane and its support for its environmental law clinic not only on the part of the chemical industry but other business and chamber groups as well. The [association] Board of Directors voted to actively engage the clinic by targeting Tulane itself, which gives cover to its out-of-state, student want-to-be lawyers and their job killing lawsuits."

Local news reported on the questioning by State Senator Karen Carter Peterson of LCA witnesses as to whether “this bill was aimed at keeping the clinic from suing BP.” Tulane Environmental Law Clinic director Adam Babich told the Huffington Post, "Their fundamental problem is that they don't want our clients to have lawyers."

See how it’s all interacting?

Legally Blocked - The Corporate Crackdown on Students

Things can be pretty tough for law students these days. When students are in school, you hope that at least they get a chance to do interesting and important clinical work (like Elle Woods over here) before becoming slaves to enormous student debt, which makes public service careers nearly impossible for most. 

In fact, one of the best things about many law schools is their clinical programs, which not only give students real world experience, but often greatly serve the public interest, allowing student involvement in cases challenging civil rights violations (here, here), as well as corporate misconduct. 

The fact that sometimes law students and clinics, in exercising cherished academic freedom, take on difficult causes shouldn’t be news.  But suddenly, it is so much news that the New York Times had to address it today in an editorial called “First, They Get Rid of the Law Clinics.” (BTW, is this a take off of the “First they came for …” poem about German inaction during Hitler’s rise to power or Shakespeare's quote “The first thing we do, let's kill all the lawyers” or maybe a combination? I guess who cares – the whole thing’s sick.)

The editorial is responding to the new backlash from corporate America to try to stop law school clinics from suing corporate miscreants by lobbying lawmakers to threaten the schools’ funding.  The most heated situation to date involves the University of Maryland Law School, whose environmental law clinic sued huge poultry company Perdue Farms for pollution.  This was “the first effort in the state to hold a poultry company accountable for the environmental impact of its chicken suppliers.”  The backlash sparked a huge outcry from law professors and others (some of which is described here today by Phoebe A. Haddon, Dean and Professor of Law, who also describes an ultimate compromise).

But Maryland is far from the only school where this is happening.  As the Times reported earlier, it’s also a problem at Rutgers in New Jersey, Tulane in Louisiana and the University of Michigan.  The Times reports, “’We’re seeing a very strong pushback from deep-pocket interests, and that pushback is creating a chilling effect on many clinics,’ said Robert R. Kuehn, a law professor at Washington University in St. Louis, citing a recent survey he conducted that found that more than a third of faculty members at legal clinics expressed fears about university or state reaction to their casework and that a sixth said they had turned down unpopular clients because of these concerns.”

Hey, if that doesn't grab you, imagine a world without the Legally Blonde franchise.  I am just not sure I want to live in that world!

Fighting Insurance Abuse in Court

The high profile and, many believe, politically-motivated litigation by a few state Attorneys General (some in defiance of their own Governors) to invalidate the new health insurance reform law is nothing compared to the litigation that will likely be needed to force insurance companies simply to comply with the law. 

Today we learned that “insurance companies are already arguing that, at least for now, they do not have to provide one of the benefits that the president calls a centerpiece of the law: coverage for certain children with pre-existing conditions” – conditions like “asthma, diabetes, birth defects, orthopedic problems, leukemia, cystic fibrosis and sickle cell disease.”  (In other words, they want things to be business-as-usual, like how they handled 10-day-old Houston Tracy, who needed surgery to correct a congenital heart defect and whose insurer initially denied the claim calling the birth defect a “pre-existing condition.”)

The insurers now seem to be saying that rather than refuse to cover treatment for a pre-existing condition, the company “might simply deny coverage for the child or the family” until 2014, when they are required to provide coverage.  Whoa.  The Times writes,

Senator John D. Rockefeller IV, Democrat of West Virginia and chairman of the Senate commerce committee, said: “The ink has not yet dried on the health care reform bill, and already some deplorable health insurance companies are trying to duck away from covering children with pre-existing conditions. This is outrageous.”

The White House says it will try to clarify this through regulations but “lawyers said the rules could be challenged in court if they went beyond the law or were inconsistent with it.”  Gee, an insurance company forcing a case into court? 

Welcome to the world of policyholders and their attorneys, who spend a good chunk of their life trying to get intransigence insurance companies to comply with the law and pay legitimate claims - like the Chinese drywall case that a homeowner recently won in Louisiana.  Remember the ongoing, enormous Chinese drywall mess? (“Many homeowners in southeastern states such as Louisiana and Florida have found that drywall imported from China amid the housing boom and rebuilding efforts after the 2004 and 2005 hurricanes emits sulfuric gases that smell bad, make people feel sick and corrodes metal appliances, wiring and components in homes. Insurers have universally been denying claims.”)

In this new case, a local judge ruled that “the policy exclusions that insurers have commonly been using to deny claims for drywall damage don’t apply.”  For example, insurers were actually trying to get out of covering a homeowner's claim by applying an "environmental damage" exclusion, even though clearly the damage to homes came from defective building materials - not pollution.  The legislature is also considering a bill to prevent homeowners who file these claims from being cancelled. 

Oh, they’ll need that law.  And they’ll need good trial lawyers, too!