Litigation and Trial - Max Kennerly : Philadelphia Trial Lawyer Max Kennerly : Business and Commercial Litigation : Civil Attorney : The Beasley Firm : Philadelphia Pennsylvania

The WSJ Law Blog points us to a Gawker reference to an AP article that says:

Richelle Olson sued [Sacha Baron Cohen] and NBC Universal on May 22, claiming an incident at a charity bingo tournament that was filmed for the upcoming "Bruno" left her disabled.

Olson claims she was severely injured after struggling with Cohen and his film crew at the event, held in Palmdale, Calif., two years ago. The lawsuit states she now needs a wheelchair or cane to move around.

The lawsuit seeks unspecified damages of more than $25,000.

Gawker wonders aloud:

We would hope that if this lady genuinely suffered brain bleeding that left her in a wheelchair that she's a asking for much more than $25,000 in damages, but why she waited two years to file the suit is anyone's guess—-Some would say probably because it's all a bunch of BS.

Don't blame Gawker, they don't claim to be legal experts.

The suit was filed in Lancaster, California, which is in Los Angeles County.

As you can see from this fee schedule (PDF), the Superior Court of California, County of Los Angeles, has a "limited civil case" program for those cases valued at less than $25,000. It likely has different rules and different judges, much like Philadelphia's mandatory arbitration for cases below $50,000 and Pennsylvania's municipal court for cases below $8,500 (or $10,000 in Philadelphia).

Most states have in place a "small claims court" of some sort for claims below a certain value, to conserve judicial resources while still giving parties access to substantial justice.

Thus, a suit that "seeks unspecified damages of more than $25,000" could be worth millions or billions of dollars. That allegation is nothing more than a legal term inserted in the complaint by the plaintiff's lawyer to let the clerk know that the case should be assigned to the full-fledged civil trial court and not the small claims court.

As for the two years, I doubt that has anything to do with the plaintiff herself. It takes time to prepare a case, and it's not surprising to see a case filed right as the statute of limitations is about to expire. Perhaps the lawyers have been discussing settlement. Perhaps the plaintiff was hoping to avoid suing and was seeing if they would get better, but, due to the statute of limitations, has to sue now or never.

[UPDATE: Daniel A. Reisman, a Los Angeles business lawyer, fills in the details, noting how (like in Pennsylvania), plaintiffs in personal injury suits are prohibited from stating specific damages in their complaint.]

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Victoria Pynchon at Settle It Now says she has spotted a settlement unicorn out in the wild. Indeed, she says she actually caught it and fully and finally released its to become the certified check it always wanted to be.

I dispute the taxonomy. What she caught was nice, but it was at most a narwhal. The case, a medical malpractice action, had already progressed through substantial discovery, including the plaintiff's deposition and, I presume, the written discovery, which usually happens before the major depositions. Moreover, there seems to be an element of res ipsa, too, as it was not just an unwanted scar after surgery but after plastic surgery, and the substantial focus paid to it by the lawyers and insurance adjuster suggests to me that the scar represented not only the damages but much of the breach of the standard of care as well.

Most importantly, the damages and ultimate settlement value did not appear to be substantially greater than the cost to the insurer of defending the case through trial.

Given how it was a scar case, with the plaintiff initially demanding $500,000 (and the insurer initially offering nuisance value), I would presume the case settled for $150-250,000 in an urban jurisdiction or $75-150,000 elsewhere. That's more than the cost of defending the case at trial, but not much more. Defending a simple plastic surgery malpractice case is probably between $75-125,000, including attorneys' fees and experts and costs. Could be less if they're lucky, could certainly be more.

Which brings me to the biggest question here: why did they agree to mediation? I think I know the answer. Given where they were in the litigation, the parties had not yet spent substantial sums on expert fees. The plaintiff's lawyer had had probably spent less than $5,000 on experts, depending on their relationship with the experts (some get the experts heavily involved from day one to help guide them, others are comfortable with their own knowledge up until discovery has been substantially completed). The defense expert fees were minimal, as the insurance company has a much larger roster of experts and did not yet need to select them and fully brief them.

Thus, when the parties agreed to mediate, there was likely $40-60,000 "on the table," which could either be used to help settle the case or could be thrown away on experts. As noted above, that sum alone -- putting aside attorneys' fees and all the other costs and issues -- likely represented between one quarter and one half of the eventual settlement value, and the lawyers, whom I am guessing were experienced in medical malpractice, both deserve credit for recognizing this economic waste.

But that's why I just can't verify this as an actual sighting of the mighty unicorn. To me, it's analytically similar to my initial example of two businesses who resolve their dispute not because they really reach an agreement, but because the cost of the dispute is less than the value of their continuing relationship. The equation above doesn't work in a wrongful death or birth injury case. It frequently doesn't apply in cases worth more than $250,000 and virtually never applies to cases worth more than $500,000.

Frankly, in those cases, I can't blame defendants and insurance companies from making me work for it. As a purely economic analysis, why not spend $50-100,000 just to see if I get a crummy expert or if I bungle a deposition or are unable to pry those incriminating e-mails out of their servers?

I know, it sounds like I'm changing the definition of the unicorn by taking these smaller cases off the table and by discounting settlements reached after substantial discovery. I'm not trying to create a moving target, I'm trying to figure something out. At the end of the day, I just can't see how to bring parties to the table without an external factor narrowing the issues, whether that factor be an ongoing business relationship, the "money on the table" that exists before expert and other fees, or, most commonly, the discovery and litigation that reveals in detail the strengths and weaknesses of each other's position.

To put it another way, I can't see, as a matter of game theory, how to convince a defendant to settle a large case prior to them exhausting all their options in litigation.

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GCs and in-house counsel are clamping down, driven by a weak economy, bringing litigation cost containment back into the spotlight (as well as general counsel peevishness).

Stewart Weltman, who wrote that second linked article, was generous enough to chime in on my post on a few suggestions for cutting costs (if you get a chance, see his blog -- inspiring stuff for lean and mean plaintiff's lawyers):

It is one thing to say the words but it is another thing to put it in practice. For instance, while unnecessary depositions are one of the biggest black holes of discovery costs, suggesting that depositions be replaced by witness statements reflects a naivety and superficiality about the actual process of preparing for trial.

Of course you try to obtain witness statements if you can, but anyone who has handled complex litigation matters knows that obtaining (1) witness statements from hostile witnesses is an impossibility, (2) witness statements from neutral witnesses can be beneficial but because most lawyer up usually provides little benefits and (3) witness statements from friendly witnesses is rarely a good tack.

All true, though in my experience there's plenty of room for fat to be trimmed from the typical business / commercial litigation deposition. I can't count how many times I've seen:

• multiple lawyers defending a deposition;
• lawyers flying out to meet with clients the day before a brief phone deposition;
• depositions of employees / corporate representatives who only know facts that could have been or already have been answered by written discovery;
• day-long depositions of witness' spouses, siblings, parents;
• depositions where I make a witness read in a handwritten text, because opposing counsel refused to stipulate anything; and,
• depositions where I make a witness read through extensive materials in order to answer questions, because opposing counsel instructed them not to review any materials, in spite of my notice of deposition.

All of those tactics can have a place, particularly if you're playing hardball. Ordinarily, they're a complete waste of everyone's time, which is a big problem if you're paying the lawyers by the hour.

It's true, I rarely get useful "signed witness statements," but I frequently get useful interrogatory answer in lieu of whole depositions. If defendants were willing to stipulate to more (and defense is usually what businesses are complaining about), they'd save a lot of time and money.

The biggest problem with that is how a good deal of "defenses" are stupid and so the "defense" is predicated on confusing the issues as much as possible, which encourages forcing the plaintiff to prove even the most basic facts. Can't help GCs there -- consider paying up.

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Judge Sheppard of the Philadelphia Court of Common Pleas (commerce court division) had opportunity to pen this clear, concise opinion explaining when a litigant may claim legal malpractice for entering into an unfavorable settlement:

Nixon Peabody relies upon the case of Muhammad v. Strassburger, in support of its claim that the Rubins should not be able to bring suit. In Muhammad, plaintiffs in a medical malpractice action agreed to accept a monetary settlement from defendants in exchange for dismissing their lawsuit. After they agreed to the settlement, plaintiffs changed their minds and decided that the settlement amount was insufficient. Plaintiffs sued their attorneys for legal malpractice because plaintiffs were dissatisfied with the monetary settlement. The Pennsylvania Supreme Court held that a client cannot sue his attorney for legal malpractice when the client is simply dissatisfied with the terms of the settlement, unless the client can show that he was fraudulently induced to enter into that settlement.

This holding was later narrowed in McMahon v. Shea. In McMahon, the court noted that Muhammad was based on Pennsylvania's public policy of encouraging the settlement of disputes and preventing "Monday morning quarterback suits."  In limiting Muhammad to the specific facts of that case, the McMahon court concluded that the plaintiffs allegations that his attorney failed to advise him of a contract's controlling law constituted grounds for a permissible claim for negligence. McMahon limited Muhammad to cases involving similar facts.

In Banks v. Jerome Taylor & Associates, the Superior Court reconciled the Muhammad and McMahon decision as follows:

"In cases wherein a dissatisfied litigant merely wishes to second-guess his or her decision to settle due to speculation that he or she may have been able to secure a larger amount of money, i.e. 'get a better deal' the Muhammad rule applies so as to bar that litigant from suing his counsel for negligence. If, however, a settlement agreement is legally deficient or if an attorney fails to explain the effect of a legal document, the client may seek redress from counsel by filing a malpractice action sounding in negligence." 

In the case at bar, the allegations are more similar to the facts in McMahon than in Muhammad. The Rubins alleges that Nixon Peabody, early in its representation of plaintiffs, failed to file one of the claims sought to be prosecuted by plaintiffs within the applicable statute of limitations. Plaintiffs further allege that Nixon Peabody continued to prosecute the claims in the Kentucky federal court suit and caused plaintiffs to expend one million dollars in litigation expenses. Plaintiffs allege that if Nixon Peabody had been honest and forthcoming during the Kentucky representation and Nixon Peabody would have explained to plaintiffs that the statute of limitations had expired on this claim and explained the shortcomings, plaintiffs would have made a decision as to whether they should continue with the claim. Unlike the plaintiffs in Muhammad, the Rubins did not change their minds about the settlement. Rather, they complain about Nixon Peabody's failure to advise them regarding the controlling law applicable to Rubin's claim, i.e. application of the statute of limitations and its ramifications.

Jan Rubin Assocs. v. Nixon Peabody, LLP, 2008 Phila. Ct. Com. Pl. LEXIS 175 (July 31, 2008).

Simple and direct. I'd go a bit farther than the Court (since I'm allowed to) and rephrase the rule as: a plaintiff can claim the fact of settlement at that amount was caused by malpractice, but cannot claim the amount of settlement itself was malpractice. 

The former is where, due to the malpractice of client, an unfavorable settlement was either necessary or an appropriate mitigation of damages. The latter is where the client willingly enters into an unfavorable settlement, into which they later claim the lawyer should have advised them not to enter.

 

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Rees Morrison sees the value of "Three litigation cost controls: motions, depositions, and attendees at court conferences and depositions:"

As published in Met. Corp. Counsel, Vol. 16, July 2008 at 39, the steps are (1) permit no motions to be made without your approval; ...

Among the several other cost-control measures they advocate is to try to get signed witness statements. Those statements are “easier, better, more effective and often achieved at a fraction of the cost” of a deposition. According to them, “Only truly material witnesses should be deposed.”

As a third method to pare litigation costs, “Rarely is there a need for more than one attorney to be present at court conferences or depositions.” ...

All good ideas. As a plaintiffs' attorney, who is rarely paid by the hour (and thus for whom time is money), I can tell you that we watch our budgets by not filing too many motions, by trying to have written discovery answer the basics, and by generally using one attorney.

That said, my goals are not just the opposite of defense counsel's but are substantially different in character. I'm trying to build a coherent trial record and case theory that supports my claims and smokes out potential problems. Defense counsel, in contrast, is either trying to poke holes in my theories or is trying to drive me into the ground (or both).

The former can be done on a lean budget; the latter is a bit harder. Note: the latter works far, far, far less frequently than defense lawyers and defendants believe it will. You can bet that, if I took a case, I already judged it as having some inherent strength, which means you likely can't bury it even if I screw it up.

My biggest recommendation would be for general counsel / in-house counsel and their litigators to sit down, early in a case, and figure out their goals. That does not mean choosing between "giving in" and "fighting it." "Fight it" means diddley-squat in litigation, yet I hear that all the time; of course it can be "fought."

The questions are much more complicated than that; if your litigator can't explain why it's more complicated, then you should start demanding they explain how they're looking out for your strategic interests and not just churning the hours.

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Victoria Pynchon responds again in our ongoing conversation.

First, a comment on one of her later posts. She quotes an article in California Lawyer in which a litigator advises parties lobby the devil out of mediators prior to the mediation because:

If the other side convinces the mediator that you will accept a lesser result than advertised, your chance of success will plummet (and you may end up facing a very unhappy client). On the other hand, if you convince the mediator that your adversary is willing to give more to settle than is on the table, you may well be on the way to having a successful outcome and a satisfied client.

A rhetorical question: if you have a solid bottom line, and engage appropriate negotiation tactics, does it matter what the mediator thinks?

Under standard business theory, the answer is "no." You and the opposing party are either in the zone of potential agreement, where your client will be "happy" with the result, or you aren't. Once in that zone, the question is money on the table -- which should be covered by your negotiation tactics.

But the real answer is: maybe it shouldn't, but it does.

Here's part of the proof, from Victoria's other post:

This very morning I failed to settle a very small case that is poised to become a very big case with cross-actions for legal malpractice and malicious prosecution. 

The delta between the Plaintiff's final demand and the defendant's final offer?   

$3,000.

Even her offer to donate half of that amount failed to seal the deal. For an amount that, in all but the smallest soft tissue case, would be considered trivial and unworth the cost and burden of litigating.

Here's my thought why: both sides were already well beyond their "bottom lines." It's no secret that, perhaps excepting where a precise, provable monetary sum is at stake, there really aren't any true bottom lines. There's always room to move, and a strong mediator -- or someone successfully using those social influence 'tricks' I worried about -- can push one side or the other beyond what they thought was their bottom line into deeper (or more shallow) waters.

But once you're in that deep, and you've cast aside what you thought was your rational, economic decision, then everything else matters more, heightening the importance of vindication and the like.

Such heightened non-economic demands increase the likelihood of failure, since, obviously, those demands are the type least likely to be satisfied by tossing around different numbers.

Victoria provides a great summary of some of the key negotiation theory findings:

[D]espite everything I've now said about litigants behaving irrationally, as I've written elsewhere in greater detail, Harvard negotiation gurus Deepak Malhotra and Max H. Bazerman suggest that negotiators too often confuse hidden interests and constraints with irrationality.  The mistakes and solutions when this is the case?  

Mistake No. 1: They are Not Irrational; They Have Hidden Interests -- find out what they are and you may well be able to resolve the dispute and settle the litigation without putting any more money on the table or making any further concessions;

Mistake No. 2: They are Not Irrational; They Have Hidden Constraints -- keep one ear to the ground for hidden constraints, explore them with the mediator, opposing counsel or the opposing party; often those constraints can be problem-solved away;

Mistake No. 3: They are Not Irrational; They Are Uninformed -- listen and respond; respond and listen.  You will find that EACH of you is uninformed about something that will likely make a genuine difference in the manner in which the litigation is resolved.

All true. The question is: how do I open up the hidden interests, constraints and ignorance without sacrificing my client's interests?

Obviously, Victoria's interests here are a little different from mine. While I'm sure she'd rather not be a driving force behind a settlement that one of the parties later seriously regretted, her interest is more in resolving the conflict than getting the best result for one of the parties.

Fact is, when I try to inquire into hidden interests, constraints or ignorance, I usually get a brick wall, and in truth I can understand that. If opposing counsel tries to get in my head, well, I'll argue my position in the case relentlessly, give them my number for settling it, and leave it at that.

Anything else would be perceived as weakness -- is there any doubt the author of that first article I quoted would interpret my attempt to find "hidden constraints" as a sign of weakness? And if he saw a sign of weakness, correct or not, it would make it harder for me to convince him or the mediator that the numbers I'm demanding are legitimate.

I'll address all of this material more in our continuing conversation. My primary conclusion for now is: if a plaintiff wants to participate in mediation without sacrificing their interests, they must demand, prior to participation, a tender from the defendants of the plaintiffs' bottom-line. At that point, we're not talking about where the ZOPA is -- we're talking about the money on the table.

My question back to Victoria is: how do I get there in a routine fashion? I've had such sessions plenty of times before, but I've never been able to create the circumstances for them, except by creating the circumstances for a strong case at trial.

Some defense lawyers see those circumstances for what they are and propose mediation prior to the eve of trial. Others tell me how tenuous and frivolous my case is up until jury selection. Is it worth my effort to encourage the former over the latter? Should I continue to search for the unicorn?

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The Financial Accounting Standards Board ("FASB") has proposed a rule whereby companies are to disclose to their investors the estimated costs of litigation.

Unsurprisingly, the Wall Street Journal objects to anything increasing transparency in our "free" market, raising two contradictory arguments:

Under the proposed change, a company facing a lawsuit would have to list on its financial statement its best-guess estimate of what that litigation could end up costing -- not just in attorney fees, but in any potential payout. For a company in high-stakes litigation, that means showing its hand to plaintiffs' attorneys, allowing them to gauge management's upper estimate of what the case is worth.

The effect will be to force corporate defendants to fight lawsuits with one hand tied behind their backs -- assuming the company can even figure the "fair value" of a lawsuit it has no idea if it will win or lose. Predicting the trajectory of complex, often multiyear litigation is inherently unscientific. As we saw with Merck and Vioxx, a company's stock price can jump or fall depending on jury verdicts whose results are impossible to predict.

So... the numbers are considered to be "inherently unscientific," just a guess at something "impossible to predict," and yet they will be interpreted by plaintiffs' attorneys as a precise "upper estimate of what the case is worth."

Look: I know how much a case might be worth. I even know what numbers you should, if you've got any brains, consider a possibility. If you tell your investors the same range of liability that everyone from the bailiff to the court reporter has already figured out, that won't change my settlement position one bit.

Before I took the case, I thought long and hard about the likelihood of winning and the size of damages. As more evidence comes in, I think about both again and again. Contrary to popular defense lawyer / defendant belief, telling me that my case is worthless will not dissuade me, it will encourage me, since I will interpret it as bluffing, a sign of fear and weakness, or baffonery, a failure to evaluate and to defend adequately.

Putting a public number on the case -- a number everyone recognizes is at best an approximation of a worst-case scenario you're working to avoid -- will only reveal to me that you're paying a sliver of attention.

I would write more, except that, seeing the source of this critique to be the editorial page of the Wall Street Journal, I expected it to be misleading and/or poorly researched. I was not let down. Reading the actual proposed FASB guideline  reveals this language:

For certain contingencies, such as pending or threatened litigation, disclosure of
certain information about the contingency may be prejudicial to an entity’s position (that
is, disclosure of the information could affect, to the entity’s detriment, the outcome of the
contingency itself). In those circumstances, an entity may aggregate the disclosures
required by paragraph 7 at a level higher than by the nature of the contingency such that
disclosure of the information is not prejudicial. In those rare instances in which the
disclosure of the information required by paragraph 7, when aggregated at a level higher
than by the nature of the contingency, or of the tabular reconciliation would be prejudicial
(for example, if an entity is involved in only one legal dispute), the entity may forgo
disclosing only the information that would be prejudicial to the entity’s position. In those
circumstances, an entity shall disclose the fact that, and the reason why, the information
has not been disclosed. In no circumstance may an entity forgo disclosing the amount of
the claim or assessment against the entity (or, if there is no claim amount, an estimate of
the entity’s maximum exposure to loss); providing a description of the loss contingency,
including how it arose, its legal or contractual basis, its current status, and the anticipated
timing of its resolution; and providing a description of the factors that are likely to affect
the ultimate outcome of the contingency along with the potential impact on the outcome.

I guess that takes care of everything they're worried about. The only thing a company can't do under these guidelines is intentionally or negligently fail to inform investors of a potential source of substantial liability. Is that really so hard? What are "senior litigators from 13 companies, including Pfizer, General Electric, DuPont, Boeing and McDonald's" so afraid of? What have they been hiding from investors all this time?

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What on earth were they doing?

 Following negotiations, on November 12, 2002, the parties entered into a settlement and release agreement (release agreement) ...

On November 8, 2004, [ESI] filed a praecipe for Writ of Summons. [ESI] thereafter filed a five count complaint on April 7, 2005. In their complaint, [ESI] asserted that the release agreement was invalid because [LSI] induced them to sign it by means of fraudulent misrepresentations. On May 1, 2006, by the consent of [ESI], the trial court issued an order discontinuing counts III, IV and V of their complaint. Accordingly, only counts I and II of [ESI's] complaint proceeded to resolution on summary judgment. ...

On August 7, 2006, the trial court granted LSI's motion for summary judgment and this Court affirmed that decision on October 1, 2007. ...

On October 18, 2006, counsel for ESI sent a letter to the American Arbitration Association (AAA), indicating that the CA entered into by the parties and two amendments to the CA provide for arbitration and that having received no response to its September 12, 2006 letter to counsel for LSI, ESI was "now request[ing] that the American Arbitration Association initiate the process through which an arbitrator will be appointed for the claim initiated by [ESI]." ...

By letter, dated October 30, 2006, ESI's counsel informed the AAA that its October 18th letter was not a formal demand for arbitration, but rather was a request for advice "as to how to proceed" and that if a case number had been assigned it should be voided. Thereafter, the AAA closed the matter, but on November 21, 2006, ESI again corresponded with the AAA and formally demanded that arbitration be initiated against LSI.  ...

LSI responded to ESI's November 21, 2006 letter, again asserting that the claim ESI was attempting to submit to arbitration was the same as the claim that ESI agreed to withdraw with prejudice during the pre-trial conciliation before Judge Scanlon and as memorialized by the May 1, 2006 court order. ...

Receiving no response to its December 1, 2006 letter, LSI filed a complaint on December 14, 2006, seeking "a declaratory judgment that [ESI] cannot re-litigate in arbitration a claim that was previously dismissed with prejudice…."

LSI Title Agency, Inc. v. Evaluation Servs., 2008 PA Super 126.

Big surprise: ESI lost. They can't arbitrate the same claims they permitted to be dismissed "with prejudice." (As an aside: they tried to get a new claim in by saying they were arbitrating "breach of the duty of good faith and fair dealing," which, the court reminded, is not an independent claim outside of breach of contract.)

It's simple: arbitration is not a parallel universe, where collateral litigation is but a passing fancy. If you submit your claim to one or the other, then that's that (like here). There are limited ways to preserve the options initially, but, once you go through the gauntlet, they're not going to let you try it again on the other side.

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Victoria Pynchon lays down the gauntlet (read: politely, generously and substantively replies) in response to my post about opening you and your client up to 'social influence' both as a comment and as a blog post.

I'm honored! I'm a big fan.

Pynchon writes (I'm mixing both her comment and blog post here):

The "trick" is to help the lawyers find where their bottom lines OVERLAP. It's a shame when the parties fail to find that point of overlap because it's a missed opportunity to make a mutually beneficial deal. It's also a shame when, for example, an apology or an expression of feeling can cause the parties to move close enough together to cause one or both of them to close the gap between bottom lines.

...

A friend of mine who is a psychoanalyst once told me that patients get better in therapy despite their analysts' "technique."  It's the relationship that's curative, she told me.  A patient in need will find the water of healing in the desert of a therapist's theory.  If the same can be said of mediation -- that it's the relationship that's curative -- the question that naturally arises is whose relationship?  

Why the disputants of course, which is why I recommend joint sessions.  Not stylized adversarial position-based, chest-thumping, shoe-banging joint sessions ("we will bury you") but interest-based, inquisitive, collaborative, reality-testing mediator-and-attorney directed negotiation sessions. 

It's a great point -- but, in my opinion and experience, the application of the idea will fail more often than it will work.

Why ZOPA Doesn't Usually Apply to Lawsuits

First, the zone of potential agreement ("ZOPA") is a major concept in business negotiation, no doubt, and it's an important intellectual tool.

When it comes to settling lawsuits, though, I think applying it will more often than not lead people astray. In business or commerce, the parties usually have goals that don't align per se, but do intertwine. E.g., buyers and sellers both have the same goal: the transfer of the property in question. They're just figuring out how to do it.

The parties to a lawsuit do not have intertwined interests: they have directly adverse interests. Unless there's some possibility of a future relationship, the defendant doesn't want to resolve the conflict: they want the plaintiff to drop their frivolous claim. In their mind, their best alternative to a negotiated agreement ("BATNA") is for the plaintiff to crawl in a hole and die.

Same with the plaintiff. Unlike buyers and sellers, who usually don't get much joy out of their 'conflict' as a conflict, the plaintiff usually prefers imposing a conflict on the defendant (who the plaintiff believes cast the first stone) in pursuit of justice, an imposition they will only relieve for at least "full" compensation.

That is to say, ZOPA works best when the parties consider their claims to be assets like any other; if there's emotional baggage around the assets, so be it, we can deal with that, too, with sufficient venting.

The problem is that most parties don't consider their claims to be assets; the problem isn't that there's emotional baggage around the economic understanding, it's that the parties interpret their dispute as fundamentally non-economic.

I understand why plaintiffs do that (they feel they have been wronged, not that they've acquired an asset for sale), the part that gets me is why defendants and even insurance carriers don't think of their defenses as an asset. I've seen more cases than I can count where an insurance carrier gleefully paid 50% or more -- sometimes over 100% -- of the final settlement amount in legal fees before even humoring real settlement. If everyone's behaving rationally, that should not happen. IMHO, the biggest stumbling block in most cases is the defense refusal to acknowledge the validity/possibility of plaintiff's claim. That refusal encourages and reinforces the non-economic aspects of the claim.

Then, after years of pain, and hours of bull at a settlement conference, the defendants finally make a real offer that's framed as take-it-or-leave it. Little wonder so many walk and keep going until they get a better offer, regardless of the merits of the initial offer.

The Unicorn Settlement: How Do We Find It?

I've heard of a mythical beast, which I'll call The Unicorn Settlement, where two hostile parties on the verge of a lawsuit get lawyers, almost file suit, and then, through deft representation, settle their differences peacefully and move on.

Let me exclude from The Unicorn a particular class of dispute, where two businesses with an ongoing relationship have a big dispute. I exclude that because, while I've seen many such disputes resolved pre-litigation, it has always been in the context of an ongoing relationship the value of which exceeds the value of the dispute. So I don't call that a "settlement of a case," I call it a "continuation of a business relationship."

I entered the law expecting The Unicorn to be rare but real; by this point, I have been trained by defense lawyers not to bother to check for it. I still usually do, throwing out what I think is a perfectly reasonable offer early on, which is routinely ignored or dismissed by a letter that gratuitously refers to my claims as baseless, frivolous, or made in bad faith.

So that's my biggest question to you: how do you suggest I get defendants, prior to the courthouse steps, to even enter the mindset that there's a valid claim and mediation / settlement should be considered? Reframed in words closer to your post: what can I do to (a) get the joint session to happen and (b) ensure everyone's in the right mindset?

I start every case telling the plaintiff, "this is about money." The civil justice system can't give you anything else; it can use money to fix what can be fixed, help what can be helped, and make up for the rest. (Cf: David Ball on Damages). It's crass. It's unfair. It feels cheap. All true: but either keep your eye on the ball or at least start looking for it, because the judge and jury can't give you anything else.

Not too long ago I attended an all day settlement conference in front of a Federal judge in a case involving three defendants. Discovery was done, expert reports were in. Defense counsel recognized the likelihood of plaintiff winning at trial and the possibility of substantial liability. Judge had ordered the parties come not just with settlement authority, but with the actual person who had the authority.

Defendant #1 had a reasonable offer and was ready to talk. Defendant #2 had a reasonable offer and was ready to talk. Defendant #3 "didn't know." Their answer wasn't "no," it was "don't know." "Don't know" if they want to settle, and obviously "don't know" any numbers. [You can imagine the judge's reaction.]

Point is: their ZOPA wasn't "zero," it was a null value, even after we were almost trial-ready! We were light-years away from the Unicorn Settlement problem and we had the same problem anyway, despite even a court order designed to avoid it.

What do I do about D3 and others like D3 in the future? The Judge got them to come to the table and to move; not sure how I would have, or why I should bother. I would have taken them to trial. They can come to me, on the courthouse steps, with a solution.

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In today's Wall Street Journal there's a great lesson on poor advocacy.

The article's text is indented and italicized.

Bad Legal Argument 1: Rushing Into a Judo Flip

There's a hidden tax imposed on companies that do business in the United States that hinders their international competitiveness and eventually filters down to consumers.

This "tax" takes the form of certain class-action attorneys who, like a roving shadow, look for any opportunity to claim that a business has done something wrong -- for example, provided misleading consumer advertising -- without concern for whether any member of the public actually thinks he or she was harmed. To avoid high legal fees and litigation distractions, corporations very often settle, paying out millions of dollars.

Bolding mine. When choosing themes and images ("if the gloves don't fit..."), always anticipate what happens to your themes and images in your opponent's hands, like so:

There's a hidden tax imposed on customers in the United States ... this "tax" takes the form of the widespread damage caused every year by unsafe, defective or deceptive products. Numerous business, like pickpockets, look for ways to rip off the public in small ways -- for example, providing misleading consumer advertising -- without concern for the cost it imposes upon consomers who are hurt, disappointed, or cheated by these products.To avoid high legal fees and litigation distractions in light of the damages, which are small in individual cases but large in the aggregate, customers usually don't sue even when they have strong claims. That's why class actions are so important.

Bad Legal Argument 2: Failing to Answer "So What?"

What courts often do in these cases [where not all the money is claimed by plaintiffs] is distribute the money, in an ad hoc manner, to people who are not even in the class, who would not have had standing to sue, and who were never even alleged to have been wronged. This alternative remedy is known as cy pres, which translates to "as near as possible," and in theory is supposed to benefit class members.

But often these windfalls go to charities with little or no relationship to what was at issue in the original dispute. A good illustration is a recent California case involving debt collection practices, in which the unclaimed proceeds were designated for distribution to a legal aid society to use in representing or educating consumers .

While a particular fact may bother you to no end -- a completely blank medical record, a deleted email, the defendant blaming an empty chair for what happened -- it doesn't necessarily mean anything to the rest of us. Here's a simple response:

After extensive research, these two litigators, published in the WSJ, couldn't find a more galling example than a legal aid society receiving funds from a wrongful debt collection practices lawsuit. So what? What's wrong with that? What better way to help society prevent the exact wrongdoing that happened in the case?

Bad Legal Argument 3: Getting It Wrong

In our view, this as-near-as-possible remedy in class actions is defective. The Constitution provides for the resolution of "cases" and "controversies" between aggrieved parties. Courts are empowered to resolve those specific disputes, and not to transfer a corporate defendant's assets to an outside organization that has not appeared before the court. The Constitution does not give courts the authority to satisfy notions of "deterrence" by giving institutions like legal aid societies or universities windfalls when those entities are not even parties to the lawsuit.

In most cases, you will have a flash of brilliance where suddenly a difficult issue will become simple and obvious.

When that happens, write your brilliant insight down. Then go to bed and look at it again the next day. If you can, look at it again next week. Or else you get what happened here.

Class actions are, except where Congress has specifically created federal jurisdiction in an attempt to help businesses, state creations. Article III defines the powers and limitations of "the judicial power of the United States."

That's a limitation on federal judicial power. There's no federal limitation on state court power, except where that power violates rights guaranteed by the federal Constitution.

Perhaps that's what the authors meant, that class actions are a due process violation. Except that's not what they said. They said the Constitution didn't empower courts to act that way; well, the Constitution doesn't empower state courts to do anything, the states are sovereign in their own right.

Bad Legal Argument 4: Pretending the Complex is Simple

Let's assume they had done that the right way, and had argued class actions were a due process violation. They would still be open to this attack:

After 232 years of judicial, congressional, presidential and state efforts to interpret the Constitution, including a civil war, these authors have figured it all out in three sentences, without a single reference to anything that transpired before them, not even the hundreds of cases specifically raising their critique, nor the dozens of judicial opinions dismissing that same critique. Do we now decide the law by looking neither to the past nor careful reasoning for guidance, but instead by simply declaring "in our view" before our conclusion?

Perhaps they should have perused the legal scholarship network on SSRN for a little bit before publishing that. "'Class action' AND 'due process'" returns 378 hits.

Whatever else goes your way, I can guarantee that, if you don't put in the time to really prepare and test your argument, something will go wrong. And that's the heart of poor advocacy.

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So sayeth 3si Sec. Sys. v. Protek, 2008 U.S. Dist. LEXIS 56283 (E.D. Pa. July 23, 2008), more routine commercial litigation:

The gist of the action doctrine "precludes plaintiffs from re-casting ordinary breach of contract claims into tort claims." eToll, Inc. v. Elias/Savion Adver., 811 A.2d 10, 14 (Pa. Super. Ct. 2002) citing Bash v. Bell Tel. Co., 601 A.2d 825, 829 (Pa. Super. Ct. 1992). The difference between a cause of action for tort and breach of contract is that "tort actions lie for breaches of duties imposed by law as a matter of social policy, while contract actions lie only for breaches of duties imposed by mutual consensus agreements between particular individuals." Bash, 601 A.2d at 829. A breach of contract may give rise to a tort claim only when defendant's wrongful conduct is the gist of the action, and the contract is collateral. Pittsburgh Constr. Co. v. Griffith, 834 A.2d 572, 582 (Pa. Super. Ct. 2003) citing Bash, 601 A.2d at 829)

To successfully prove a negligence claim a plaintiff must demonstrate the following elements: (1) a duty of care was owed by defendant; (2) defendant breached this duty; and (3) the breach resulted in injury. McCandless v. Edwards, 908 A.2d 900, 904 (Pa. Super. Ct. 2006) (citations omitted). Because Defendant's obligation to provide Plaintiff with FlexPac batteries arose from the contract and not from a general duty of care, Plaintiff's negligence claim should be barred by the gist of the action doctrine.

In Factory Market v. Schuller Intl, defendant guaranteed plaintiff it would install a watertight roof. 987 F. Supp. 387, 388 (E.D. Pa. Jan. 9, 1997). Defendant promised to pay for any repairs needed to maintain the roof in a watertight condition. Id. at 389. From the onset "the roof was plagued with leaking problems," which defendant attempted to fix on a number of occasions. Id. Upon various unsuccessful  attempts by defendant to repair the roof, plaintiff brought suit against defendant alleging breach of contract, negligence, and fraud. Id. at 391. The court held that plaintiff's negligence claim sounded more in contract than in tort. Id. at 394. Plaintiff merely alleged that defendant's repairs were negligently performed, and as a result the roof was not watertight despite defendant's guarantee. Id. at 394-95. The court ruled that defendant did not owe plaintiff a duty of care; rather defendant's obligation to repair the faulty roof was imposed by way of the contract, and without the contract plaintiff "simply would not have [had] a claim." Id. at 395. Therefore, the court barred plaintiff's negligence claim. Id.

(emphasis added).

Without fail, defendants raise the "gist of the action" doctrine in every single breach of contract case that also includes other claims. It doesn't matter if the other claim is unjust enrichment, tortious interference, fraud, defamation, professional malpractice, or any other entirely appropriate claim that can rest alongside a breach of contract. If there's a contract, and there's another claim, the preliminary objections / 12(b)(6) are inevitable.

And it's usually wrong.

The doctrine is simple: the "gist of the action" doctrine precludes negligence claims where, under the facts alleged, the defendant has no duty to the plaintiff except for those created by contract. The "gist" is contractual -- there are no duties between the parties except for those created by the contract.

A reminder: everyone has a duty not to defraud others. Everyone has a duty not to tortious interfere in others' business. Everyone has a duty not to defame others. If someone defrauded you, that's wrong; you don't need to first have a signed and sealed Agreement Not To Defraud Me.

Ergo, there's really only one instance in which, at the complaint stage, the "gist of the action" doctrine applies: where a complaint alleges breach of contract and negligence based solely upon that contract. That a plaintiff cannot do.

Fraud and breach of contract? That's fine -- indeed, they're usually entirely appropriate forms of alternative relief which a plaintiff should allege if they have the factual basis.

But if you're alleging negligence, there must be an independent duty outside from the contract itself.

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Drug and Device Law has an exceptionally detailed post about the new voluntary PhRMA guidelines, along with dozens of cases holding that such guidelines don't create negligence per se liability standards, particularly not retroactively.

But what about ordinary, post hoc negligence? Can voluntary industry codes be relevant to the standard of care?

Absolutely! For example, the Eastern District of Pennsylvania case they cited, Knarr v. Chapman Sch. of Seamanship, 2000 U.S. Dist. LEXIS 5351 (E.D.Pa. 2000)(interpreting Florida law), rejected the per se application of ANSI standards, but was happy to cite "Jackson v. H.L. Bouton Co., 630 So. 2d 1173, 1174-75 (Dist.Ct.App.Fl. 1994)(violation of ANSI standards is "merely evidence of negligence.)."

The same is true in Pennsylvania, where evidence of industry standards is clearly relevant to the reasonableness of a manufacturer's conduct, and is thus admissible, except in strict liability cases where reasonableness is irelevant. Lewis v. Coffing Hoist Div., Duff-Norton, 515 Pa. 334, 528 A.2d 590, 594 (Pa. 1987). As you'd expect, if the plaintiff brings in industry standards, so too can the defendant. Daddona v. Thind, 891 A.2d 786, 807 (Pa. Commw. Ct. 2006).

As for whether its plaintiffs or defendants are engaging in what D&D Law calls "foolishness," you can bet your bottom dollar that every PhRMA defendant from here on out will make their compliance with these new standards the centerpiece of future defenses, and that PhRMA took great pains to ensure these codes were easy to comply with and would play well in front of judges and juries.

Seriously, look at these codes and consider the state of the industry in 2008:

Promotional materials should:
(a) be accurate and not misleading;
(b) only make substantiated claims;
(c) reflect the balance between risks & benefits; and
(d) be consistent with all FDA requirements.

...

Decisions regarding the selection or retention of [health care providers] as consultants should be made based on defined criteria such as general medical expertise and reputation, or knowledge and experience regarding a particular therapeutic area.

...

Companies should not use consultant arrangements as inducements or rewards for prescribing a particular medicine or course of treatment.

...

Train representatives to ensure general science and product-specific information so that representatives can provide accurate, up-to-date information, consistent with FDA requirements.

That's voluntary? It should be mandatory. No praise will come from these quarters, I don't consider it a "good deed" to encourage member companies follow FDA requirements. It's the law.

In 2008 we have to remind (it wasn't part of the old code!) pharmaceutical companies not to mislead people with promotional materials. What a shame.

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A Pennsylvania / Federal consumer law question on LawGuru:

My husband & I took our 1st mortgage with [lender1] and our 2nd mortgage with [lender2] and refinanced them into 1 with [lender2] on 4/21/08.  In June we started getting calls that our 2nd mortgage is past due.  We called [lender2] and they said it was a common problem, just ignore it.  We continued getting calls and a letters from an attorney.  WE have the HUD form that says it is paide, but there is an internal problem in the system that says otherwise.  No one knows how to fix it.  We have continued to call [lender2] and they don't return our calls.  WE have to call them back.  We get excuse after excuse.  My husband has lost hours at his job trying to fix them problem, and I, a teacher, have also.  Is there anything ''legally'' that we can do.  I have all calls documented with dates and times, along with several emails.  Four months have almost past. We need help!

My fair debt collection practices response:

You asked about a creditor repeatedly demanding payment of a nonexistent debt.

The Federal Fair Debt Collection Practices Act prohibits creditors from attempting to collect on debts they know are erroneous. As the Federal Trade Commission points out on their website, "A collector may not contact you if, within 30 days after you receive the written notice, you send the collection agency a letter stating you do not owe money. However, a collector can renew collection activities if you are sent proof of the debt, such as a copy of a bill for the amount owed."

In addition to your phone calls, you should send everyone who attempts to collect that debt a written demand they cease all collection activities. If that still doesn't work, you have two options (which you can use simultaneously): sue in Court, where you can receive up to $1,000 for the violation, and/or complain to the FTC at www.ftc.gov.

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Another day, another breach of contract case alleging "fraud in the inducement, unjust enrichment, and tortious interference with contractual and business relationships." Sheinman Provisions, Inc. v. Nat'l Deli, LLC, 2008 U.S. Dist. LEXIS 54357 (E.D.Pa. 2008). Here's what inevitably happens:

Based upon the parties' pleadings and the Court's own review of the contract at issue, we find that the Asset Rental Agreement is a fully integrated contract, which contains an express provision stating that in entering the Asset Rental Agreement, neither party has relied on any claims, representations or warranties made by the other, except as expressly set forth therein. Therefore, the parole evidence rule squarely applies here because Plaintiff is seeking to offer evidence of representations made prior to the execution of the Asset Rental Agreement to contradict an express provision thereof. As it is well established that "fully integrated contracts preclude fraudulent inducement claims," this claim will be dismissed as barred by the parole evidence rule. Because the fraudulent inducement claim is defeated by the parole evidence rule, we do not need to address Defendant's arguments based on the gist of the action doctrine and Rule 9(b).

...

In this case, the agreement at issue is a fully integrated contract and, by its terms, it governs the entire relationship of the parties. Therefore, we disagree with Plaintiff's argument that Rule 8(d)(2) allows pleading in the alternative in this case. Rule 8 only allows alternative claims to be plead if all of the claims are sufficient on their own. Here, even if the breach of contract claim fails, the unjust enrichment claim is still insufficient because Pennsylvania law prohibits unjust enrichment claims where a contract governs the relationship of  the parties, as is the case here. The bar to this type of claim is not altered when unjust enrichment is plead in the alternative to an unsuccessful breach of contract claim as the relationship of the parties is still governed by a valid contract, and therefore, there is no reason to apply the quasi-contract doctrine of unjust enrichment. Plaintiff's unjust enrichment claim will be dismissed.

...

Sheinman's tortious interference claim alleges almost identical facts: that Defendant intentionally interfered with Plaintiff's business and contractual relationships to cause its customers, vendors and suppliers to discontinue purchasing from Plaintiff and deal directly with Defendant. Following the Third Circuit's holding in Chemtech, we find that the duties allegedly breached by Defendant were not imposed as a matter of social policy, but rather flowed from the Asset Rental Agreement. Therefore, the gist of the action doctrine bars Plaintiff's tortious interference claim here as the duties  allegedly breached were grounded in the contract between the parties.

Ouch! Those all look like pleading problems: if you're doing to allege claims outside breach of contract, make sure the facts you allege can support them -- the claims can't simply be naked alternatives to your breach of contract. From looking at the facts (a wholly integrated contract only breached in a few, but important, ways), I really don't see how the plaintiffs could have pulled it off.

I can't blame the plaintiffs for trying, though: if they had not alleged these claims, and then evidence later revealed they should have, the defendants would have inevitably cried foul with the statute of limitations, and probably would have won, since the amendment would have been for entirely new claims. It was largely a waste of everyone's time, but unless defense counsel's in the mood for a tolling agreement (hint: they're not), you don't have a choice.

Hate the game, not the players.

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Most attorneys I know keep a "legal research" file. As they have continued on their careers, they have come across numerous issues that took a considerable amount of time to research. After spending that time, in hopes of increasing productivity, the attorneys then dump the core parts of the research into a really long Microsoft Word file (or a really large folder or finder).

I don't. Why? Because of the Brontosaurus.

There is no such dinosaur as a Brontosaurus. The term arose from a mistaken identification of fossils in 1877, later generally corrected among paleontologists in 1903. The "Brontosaurus" was an apatosaurus skeleton that a paleontologist mistakenly associated with a camarasaurus skull.

Surely everyone knows this old, obvious, easily-confirmed fact? WIRED is a tech-savvy, research-friendly magazine. In April 2006, it published "Bringing back the Brontosaurus," an article about reconstructing animals via their genes, without bothering to note the distinction.

Why? Most likely because the author learned it as a "brontosaurus," as did his colleagues. A simple Google search would have revealed the error.

And that's why I don't keep a legal research file: it'll have something wrong with it. Maybe you put it in wrong, maybe you took it out of context, maybe the cases have been overturned, or maybe you messed up the first time around, too. I've always lost more time relying on a "research" file than I've gained.

Moreover, some of my best arguments come from reading recent court opinions, watching as a court grapples with an issue either similar or analogous to my own. The law is your tool - why let it go dull?

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The normal rule is that a party cannot get an injunction without demonstrating "irreparable harm," and that monetary harm is not "irreparable." Plaintiffs always try to get around this limitation by coming up with novel ways that the particular harm is "irreparable." In Bennington Foods LLC v. St. Croix Renaissance Group, LLP, 528 F.3d 176 (3d Cir. 2008), plaintiff claimed the damage to business goodwill was "irreparable," won in the District Court, then lost at the Court of Appeals:

The District Court found that failing to issue a mandatory injunction would cause irreparable harm to Bennington. Specifically, it found that failure to issue the injunction would harm Bennington's reputation for being able to deliver scrap metal on time. How ever, a plaintiff in a breach of contract case cannot convert monetary harm into irreparable harm simply by claiming that the breach of contract has prevented it from performing contracts with others and that this subsequent failure to perform will harm the plaintiff's reputation. ...

The inability to gain possession of the scrap metal at issue here creates at most a monetary loss. In the event that subsequent failure to deliver scrap metal to others might create a cognizable risk of irreparable harm to the plaintiff's reputation, Bennington has not demonstrated, except by Bennington's president's personal assertions, that the scrap metal business is different from other types of commerce in such a way that normal breach of contract remedies could not provide a remedy. Nor has Bennington identified any contracts to resell the scrap metal which it has been unable to perform, any third parties with whom it has suffered a loss of reputation, or any attempts—futile or otherwise—it has made to fulfill contracts to deliver scrap metal by obtaining it from other sources.

The Third Circuit goes on to note that damage to ordinary business goodwill is different from continuing trademark infringement (Pappan Enterprises, Inc. v. Hardee's Food Systems, Inc., 143 F.3d 800 (3d Cir. 1998)) and a suspension from horse racing for suspected cheating (Fitzgerald v. Mountain Laurel Racing, Inc., 607 F.2d 589 (3d Cir. 1979)), both of which cause "irreparable" harm.

They then note an apparent split with the Fourth Circuit:

Bennington, however, cites to Blackwelder Furniture co. of Statesville, Inc. v. Seilig Manufacturing Co., Inc., 550 F.2d 189, 197 (4th Cir. 1977), a case in which the trial court denied a preliminary injunction. The Fourth Circuit Court of Appeals reversed, holding that the district court's finding of no irreparable harm was clearly erroneous. Id. at 196. In so concluding, the court stated that

The harm posed to Blackwelder's general goodwill by its inability to fill outstanding and accumulating orders in excess of $ 15,000 for furniture listed in its catalogues is incalculable not incalculably great or small, just incalculable.

Id. at 197.

We are not bound by the holding in Blackwelder and we question whether irreparable harm was sufficiently demonstrated there. In addition, we note that Blackwelder has been distinguished from other preliminary injunction cases on the basis that Blackwelder “involved a manufacturer's refusal to supply its entire product line to a particular retailer, treatment which discriminated against that particular dealer.” ... As we mention above, there is nothing in the record before us to demonstrate that Bennington was unable to fulfill any contracts, was unable to find other sources of scrap metal when the Virgin Islands scrap metal could not be shipped, or lost reputation with any specific customers.

I boldfaced those two parts to show that the apparent against showing irreparable harm through secondary harm to business goodwill isn't really the problem, the problem is a failure to produce evidence.

But there's a chicken and egg problem -- in determining an injunction, factual questions are left to the discretion of the district court judge, who here had evidence of the damage to goodwill: the testimony by Bennington's president. So, really, the problem wasn't a failure to produce any evidence, but a failure to produce sufficient evidence.

I suppose, then, that the rule here recognizes business goodwill as capable of "irreparable harm," it just requires a showing of unfulfilled contracts, inability to find other providers, and/or harm to specific customers.

Good to know.

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As deemed by the American Association for Justice (which, really, should have been renamed to The Justice League of America):

1.  Allstate

2.  Unum

3.  AIG

4.  State Farm

5.  Conseco

6.  Wellpoint

7.  Farmers

8.  United Health

9.  Torchmark

10.  Liberty Mutual

Lines up with this intriguing website, which also lists Allstate the worst and Chubb the best.

I'm inclined to agree. I've been very impressed by Chubb's claims handling. I once had to interpret their "Masterpiece" policy to see if it covered a particular act which a jury could easily find was intentional (and, if proven, would have been criminal). Amazingly, it did, and without any weasely insurance-coverage language designed to tie up such a question in the courts for years.

I switched my own homeowner's to it promptly.

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Fortune Legal Pad on the French eBay injunction:

On June 30, the Commercial Court of Paris granted a sweeping injunction sought by LVMH Moët Hennessy Louis Vuitton (LVMUY) that would not only require eBay to block all sales of counterfeit Louis Vuitton Malletier and Christian Dior Couture products on its site — a feat eBay has claimed is not technologically feasible — but  also to block all sales of genuine LVMH perfumes being sold there by unauthorized distributors.

The latter prohibition would effectively force eBay to block all sales of the specified perfumes — Christian Dior, Guerlain, Givenchy, and Kenzo — since no licensed LVMH distributor is authorized to sell over eBay. The practice of selling genuine products through unauthorized channels — sometimes called gray marketeering — is generally lawful in the United States because it is thought to benefit the consumer.

The commercial court also ordered eBay to pay various LVMH units $60.8 million in damages for past counterfeit or unauthorized sales. The key issues presented by the decision (available here in French) are well summarized in this New York Times article. (eBay’s official statement about the ruling is here; LVMH’s is here.)

The day the commercial court ruled, eBay asked the French Court of Appeals to stay the injunctive portion of it while it appealed the rest of the lower court’s ruling. Without the stay, the injunction — enforceable by daily fines of 50,000 euros (about $80,000) — takes effect as soon as copies of the decision have been formally delivered to eBay’s headquarters in San Jose, California, and its international subsidiary in Berne, Switzerland. (It’s unclear if that has happened yet.) LVMH has agreed to postpone enforcement, however, until the Court of Appeals rules on the stay application, according to an eBay spokesperson. That court told the lawyers today that it would rule Friday.

It's quite a fascinating case, particularly as it touches upon appealability in the European system, the distinction of internet service providers being merely a "host" versus a "broker," and Louis Vuittion's (I think outrageous) attempts to halt re-sale of their products.

My focus, however, is on how powerful the remedy here is -- the fine is huge and the equitable remedy requires eBay do something they claim they can't.

In normal commercial litigation, it is very rare for a court to order a losing defendant change their practices in a way that could potentially destroy the business. Normally, the defendant pays compensation for what they have done wrong and goes about their business again; indeed, in Pennsylvania and the general rule is that punitive damages are not available in breach of contract cases.

Such restraint vanishes in the realms of copyright and patent (particularly patent), where the very idea appears to be strong deterrence against either the defendant or anyone else behaving like that ever again.

The end result is, liking securities litigation, few copyright or patent claims actually reach a resolution on the merits, because the stakes are simply too high, and lawyers tend to believe that such cases are so complicated that there's a high likelihood jurors, judges or arbitrators will become confused even in a slam-dunk case, resulting in uncertainty about the outcome. (See this legal malpractice case arising from a large, complex commercial dispute where "The company claims Linklaters advised it that its case had a 70 percent chance of success if it were to go to arbitration, but at a later date reduced that to 50 percent. It says that, based on Linklaters' advice, it turned down three settlement offers.")

The initial application of bad for business lawyers is obvious, and, indeed, in most business lawyers will recommend their client cease and desist the moment there's any copyright or patent claim that isn't clearly frivolous.

But I think there is another lesson learned here. Big cases settle. Notice how eBay and LVMH are still trying to figure it out.

Except sometimes they don't. How about: big cases should settle; where the law forces the case to be big, it usually settles.

So how can we, as litigators and trial lawyers, make clear to the other side that our case is really big? I'll address that more in latter posts.

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Another Pennsylvania business law / organizational dispute question:

May an attorney director of a school for the blind, act as both director-client and attorney, control legal services, not consult with the board, and build up $250,00[?] in fees to his own firm?

And my reply:

It's not inherently wrong for a director of an organization to hire their own firm to perform work for the organization.

Such 'self-dealing,' though, must be fair and must occur in the open. What you have described sounds awfully suspicious -- no director of any organization, non-profit or for-profit, can simply hire themselves (or their firms) to do work without any oversight whatsoever.

You may first want to check into what oversight there has been of the relationship; perhaps it has been approved, but through other channels. For example, chief executives (or other officers) usually have the power to hire third-parties to perform work for the organization without consulting the directors for each and every transaction.

If, however, he's doing everything on his own, and the other directors object, then there's a problem, and you may want to speak with an attorney.

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Deliberations (which, but for copyright and manners I would simply cut and paste here every day) has up a great, short article from another jury consultant title "Stop Thinking Like A Lawyer!" A sample:

Another widespread myth is that jurors make up their minds during opening statement. Again, this simply doesn’t comport with common sense. Jurors want to see the evidence. They want to hear from the witnesses. They won’t simply accept what the lawyer says on faith.

Which is not to say that the opening statements aren’t important. Indeed, we believe opening statements are critical to jury persuasion. The problem is many lawyers don’t use this opportunity to its full advantage. For example, many litigators spend opening statement describing every single piece of evidence they will present at trial. In typical lawyer fashion they go into all the minor nuances of their case, including every last little detail.

The result is information overload. Giving jurors too much information before they have a context confuses them. Rather, you should stick to the broad strokes in opening statements. Identify the key themes and facts that tell your story and provide moral context. Use the opening statement to frame your case, to establish the
wrong that jurors must right.

Clear, simple, correct and true advice. To add an additional point not raised there, be yourself. There's, for whatever reason, a debate going on now about "Ivy retardation" sparked by some faux-rebellious article about how 'elite' universities create a divide from the mythical common man. To wit,

It didn't dawn on me that there might be a few holes in my education until I was about 35. I'd just bought a house, the pipes needed fixing, and the plumber was standing in my kitchen. There he was, a short, beefy guy with a goatee and a Red Sox cap and a thick Boston accent, and I suddenly learned that I didn't have the slightest idea what to say to someone like him. So alien was his experience to me, so unguessable his values, so mysterious his very language, that I couldn't succeed in engaging him in a few minutes of small talk before he got down to work. Fourteen years of higher education and a handful of Ivy League dees, and there I was, stiff and stupid, struck dumb by my own dumbness. "Ivy retardation," a friend of mine calls this. I could carry on conversations with people from other countries, in other languages, but I couldn't talk to the man who was standing in my own house.

The best response I've seen, courtesy of a science blogger, is:

... talking to plumbers has nothing whatsoever to do with education, elite or otherwise. It's entirely a matter of personal choices-- if you find yourself unable to make small talk with someone in a blue-collar job, it's because you have chosen to be the sort of person who is incapable of talking to people in blue-collar jobs.

The same goes for juries. Don't think of them as captive, uneducated spectators. Doing that is the same as choosing not to be able to associate with those of different backgrounds. Jurors are just people, entitled to the same respect, and capable of the same glories and mistakes, as everyone else. If you start playing around with your "image," you'll just screw that up.

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What About Clients on "easy" defense representation in a declining economy:

So you think you will win your case on a dispositive motion (and you do, eventually). You are right on the merits--and any law professor in the U.S. would agree with you. The "case" your long-time GC just handed you is silly, right? And a piece of cake. Beneath you, you tell yourself. An "easy win", right?

Well, think again, Skippy.

Your GC couldn't have hired you to do anything more difficult. "Winning" just took on a new and more complicated meaning. Because now--especially if you were just handed a defense counsel's dream and stone "winner" of a case--you will have to work harder, and be smarter, than if you were defending a good faith or meritorious suit in which your client had the lion's share of bad facts. The trick now is to win cheap*. An easy-to-win business suit handled by the most efficient defense counsel on earth can have defense fees and costs well over $100,000, even with minimal or no discovery. You really think that your GC or client rep will be happy the day you tell him or her about your great win on all counts based on your brilliant Rule 12(b)(6) or Rule 56 motion?

Don't bet on it. For the experienced client, the cost of the lawsuit is part of the "victory" analysis. In a down American economy, litigation tends to increase. More suits are filed. And in my view clients and their plaintiff's lawyers file more questionable suits, i.e., ranging from Rule 11 violations and frivolous to iffy and wasteful. Employee and business nuisance cases are a big chunk of those filings.

In some sense, I understand the desire not to resolve "iffy" cases on any level, because you don't want to encourage more of them.

On the other hand, a lot of "iffy" cases are simply weak, not frivolous. The distinction is critical. A "weak" case is valid and meritorious but difficult to prove, like a soft tissue injury case. Plenty of people have serious soft tissue injuries, resulting from negligence, that restrict their ability to work and have hampered their personal lives. But they have an uphill battle at trial attempting to prove the extent of their injuries, given the nature of juries these days, and even if they win the recovery usually isn't that large.

But the possibility of recovery is there (as is the possibility of a substantial recovery) and, just as important, the ethical duty to right a wrong is there, too. Same goes for any business case: if there's a claim in any sense there, there's a chance it will carry the day, and a chance it should carry the day. Which brings me to my real point: everyone, both plaintiffs and defendants, should always consider actually resolving the case, rather than "litigating" it, which does nothing good for the clients.

If that takes mediation or arbitration or some other ADR, so be it; if it takes cutting off your own billing (or slashing your contingency agreement), so be it. Just always keep in mind that your role is to resolve conflict, not create it.

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From an order quoted on Trial Ad notes:

... The Court recognizes the tension between Rule 8(a), which requires a “short and plain statement,” and Rule 9(b), which requires the party state his claim with particularity. The issue before the Court is whether Plaintiff’s 465 page Complaint correctly balances this tension.

The Complaint does not correctly balance this tension. The title to the Complaint is eight pages. (Compl., 1-8) (Dkt. #9). It appears to list all of Plaintiff’s claims, as well as their statutory and precedential basis. In eighteen pages following the title, the Plaintiff lists the Defendants. There are six Defendants. This section consists largely of useless repetition.

Not before page 30 does the Complaint address the facts alleged. Plaintiff’s allegations continue for 87 pages — including a 37 page pit-stop to quote emails. (Compl., 39-76). The Court notes, with some irony, that in his response opposing Defendants’ motions for a more definite statement, the Plaintiff successfully states his allegations in two pages. (Pl.’s Resp., 1-3)(Dkt. #25).

On page 117, Plaintiff embarks on an odyssey through his claims for relief. While the Court understands that asserting 54 claims requires some space, the 341 pages used to do so is unreasonable. The root of the problem lies in paragraphs like the following:

Plaintiffs, for a Fifty-Fourth Claim for Relief, reallege and incorporate herein Paragraphs 1 through 105, including the First, Second, Third, Fourth, Fifth, Sixth, Seventh, Eighth, Ninth, Tenth, Eleventh, Twelfth, Thirteenth, Fourteenth, Fifteenth, Sixteenth, Seventeenth, Eighteenth, Nineteenth, Twentieth, Twenty-First, Twenty-Second, Twenty-Third, Twenty-Fourth, Twenty-Fifth, Twenty-Sixth, and Twenty-Seventh Claims for Relief alleged under the federal Racketeer Influenced and Corrupt Organizations Act of 1970 [“RICO”][Title 18 U.S.C.A. §§1961 et.seq.], and the Twenty-Eighth, Twenty-Ninth, Thirtieth, Thirty-First, Thirty-Second, Thirty- Third, Thirty-Fourth, Thirty-Fifth, Thirty-Sixth, Thirty-Seventh, Thirty-Eighth, Thirty-Ninth, Fortieth, Forty-First, Forty-Second, Forty-Third, Forty-Fourth, Forty-Fifth, Forty-Sixth, Forty-Seventh, Forty-Eighth, Forty-Ninth, Fiftieth, Fifty-First , Fifty-Second, and Fifty-Third Claims for Relief.

(Pl.’s Am. Compl., 458) (Dkt. #9).

Did he think "Plaintiffs, for a Fifty-Fourth Claim for Relief, reallege and incorporate herein Paragraphs 1 through 105" would fail to reincorporate the claims alleged in those paragraphs? Or was he paid by the word?

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The court speaks frankly in this breach of contract action:

Church contends: "In order to establish a cause of action for breach of a construction contract by a contractor, the owner must allow the contractor a reasonable time to rectify the alleged defects." Appellant's brief at 11, citing Hood v. Meininger, 377 Pa. 342, 105 A.2d 126 (1954). Church contends the Tentarellis failed to establish they gave him the opportunity to cure after terminating him on July 22, 2003, and, as such, he was entitled to a compulsory non-suit on the Tentarellis' counter-claim.

Both the legal premise and the factual conclusion of Church's argument are irreparably flawed. Church's reliance on Hood is wholly misplaced. Hood does not stand for the proposition that a plaintiff must establish he gave a contractor a reasonable opportunity to rectify defects in order to establish a cause of action for breach of a construction contract, and no case of which we are aware cites Hood for this proposition. Frankly, we are unaware of any case which stands for this proposition. While cure and mitigation are unquestionably relevant to the issue of damages in a contract dispute as a general matter, there is simply no support in our caselaw for the proposition Church advances. Notably, Church does not contend the Tentarellis' alleged failure to allow him to cure warrants a diminution of the Tentarellis' damage award.

Church v. Tentarelli, 2008 PA Super 139 (June 30, 2008). It seems to be the natural progression after LJL Transp., Inc. v. Pilot Air Freight Corp., 2006 PA Super 176; 905 A.2d 991(2006)("there are circumstances where the nature of the breach permits the aggrieved party to immediately terminate the contract despite a "cure" provision.").

That said, I think the Superior Court went a little bit far. There's precedent suggesting the party be offered an opportunity to cure the defect. For example,

In determining materiality for purposes of breaching a contract, we consider the following factors:

    a) the extent to which the injured party will be deprived of the benefit which he reasonably expected;
    
    b) the extent to which the injured party can be adequately compensated for that part of the benefit of which he will be deprived;
    
    c) the extent to which the party failing to perform or to offer to perform will suffer forfeiture;
    
    d) the likelihood that the party failing to perform or offer to perform will cure his failure, taking account of all the circumstancesincluding any reasonable assurances;
    
    e) the extent to which the behavior of the party failing to perform or offer to perform comports with standards of good faith and fair dealing.

Restatement (Second) of Contracts § 241 (1981). Accord Jennings v. League of Civic Organizations of Erie County, 180 Pa. Super. 398, 119 A.2d 608 (1956).

Either way, it's worth noting the apparent shift towards not requiring the breaching party be offered an opportunity to cure their failure, even where the contract specifically says they should be.

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Building on my prior post about there not really begin any "50-50" cases, the NYTimes interviews a
a physician and molecular biologist who teaches judges about science and genetics:

Q. DO SCIENTISTS AND JUDGES HAVE MUCH IN COMMON?

A. Well, a scientist almost never says anything absolutely. Everything is a theory, to be disproved or adjusted later on. Judges worry a lot about the certainty of conclusions, too. Judges are used to thinking of truth as an elusive concept. A lot of judges, when you bring up “the truth,” they roll their eyes. They say, “I don’t know what to say about truth. I do know about probabilities.”

As I wrote before, "If you can see a wide array of evidence and argument, which it is your sworn duty to evaluate, and yet you remain totally unmoved, then the problem lies with you, not with the inherent unknowability of the world."  I think that is a common ground between science and law, the acceptance that absolute certainty of the rightness of one's result is neither possible nor necessary.

It's worth pondering a bit more. Back in law school, I took a number of classes with an extraordinarily intelligent professor who had, among other academic achievements, previously edited a 14 volume hornbook in a particularly dense, broad and complicated legal field. He was recognized by most of his peers as the smartest professor there, and had devoted more brain power to considering the law as a whole than most anyone on earth.

He was also a cynic, dismayed by the ease with which judges would produce inconsistent arguments and wholly irrational theories of law -- frequently at odds with their own prior opinions -- just to support a particular position in a case before them. So at one point, I asked him, "is anything in the law real, or is all just made up after the fact to justify the decision?"

He answered quickly, "burdens are real. Whatever else is going on, the burdens of production and persuasion tell everyone what they're supposed to do."

My experience has reinforced that again and again. In the law, the burden of proof is the primary intellectual tool used to resolve cases.if you simply follow headlines, "the law" is generally about policy and political decisions. In most people's lives, however, the real determinant of their future is not the current policy of "the law" (given how the bulk of the law really hasn't changed in hundreds, even thousands of years), but whether the party that carries the burden can prove the burden.

Sometimes policy can be life or death, as in the latest Supreme Court child rape decision, which took death off the table. Most of the time, however, life or death is determined by meeting or failing the burden of proof in front of a judge or jury. There is no question that murder is wrong; the question is guilt.

Civil cases are no different. If you do wrong, you are normally responsible to compensate those you injured. That's not the question; the question is if you did wrong.

I've noticed on various "ask a lawyer" type websites that the most common question is whether people can sue over an oral agreement. Legally, that is not a question of all -- with the limited exception of the statute of frauds, you can always sue over an oral agreement. The question is if you will satisfy your burden of proof at trial.

The same goes for "science." "Science" in one sense is not a collection of ideas, it is a method for analyzing the natural world. Could we say that "law" is, in analogy, not a collection of rules, but rather a method for analyzing the disputes between persons? We can certainly say that for burdens -- they are tools for framing the issues, rather than a rule for what the result should be, just like the scientific method.

What's the point of such an abstract realization? I think there's a lot that lawyers can draw from the realm of science to make real, effective changes to their practice. For example, a scientific paper that does not clearly follow the scientific method (hypothesis, method, result, etc.) is usually rejected out of hand --  but how many times have you submitted a brief without clarifying what the standard of review/burden is? How many times have you heard a juror say they "did not know" that the proof of damages was also a preponderance standard?

For another example, how many times have you or opposing counsel relied on an outdated case just because it was in some sort of "legal research" file you've been keeping for years? Should you not, like a scientist, re-examine critical issues each time they come up to make sure you know the current thinking?

The point here, initially, is rigor. How rigorous is your practice? Do you have a method? Do you make sure others know what their own method should be when they consider your case?

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The Nevada Accident & Injury Law Blog describes how a Nevada Jury Awards Las Vegas Man $60 Million:

A federal jury in Nevada last week awarded $60 million to a Las Vegas man who alleged Paul Revere Life Insurance Co. and the Unum Group denied in bad faith his claim for disability benefits.

This is one of those “be careful what you wish for” cases. In a previous trial, a jury awarded Plaintiff $11.6 million but it was overturned on appeal. So the case was tried again and the second jury awards five times what the first jury awarded.

I see that a lot, particularly in tort cases with verdicts over $1 million, and I don't think it's a coincidence.

At a tort (negligence, malpractice, breach of fiduciary duty, wrongful death, etc.) trial, the defendant usually holds most of the cards. They generally know which stones you overturned on discovery and which ones you did not, and they know which evidence that you have his most embarrassing and which evidence you do not have is most absolving.

More importantly, they were there. They really know what they did and did not do, and what they were thinking when they did it, and they certainly know what they intend to say.

It does not matter how many depositions you took -- you could have had people testifying for days -- and how much written discovery you collected, trial will still be full of surprises. Even if no new facts are revealed, you will see facts presented in a new light, often at odds with the light they were presented in pleadings and during discovery. (And you will have to quickly react to this new version of the truth: don't even try to argue to the jury that a fact was "presented in a different light during discovery.")

Trial makes the defendant show their cards, clearing away their natural advantage in a tort suit. You will see the strongest defense arguments and the most favorable defense evidence. More importantly, while you can always run a mock jury and see how neutral non-lawyers react to your evidence, you will never get a chance, pre-trial, to practice cross examining a defendant to see what evidence makes them squirm, babble, or obviously lie. A deposition will give you hints, but it will never show you what will really make a defendant fold or what they'll do when the chips are down.

My view is that these big cases aren't 50-50 or longshots, they're slam dunks if you have all the evidence, know where the defendant wants to go, and know where the defendant doesn't want to go. That's how a "big" verdict becomes a "blockbuster" verdict the second time around.

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Via Settle It Now,

Gini Nelson of Engaging Conflicts ran a six-part series recently on "Adding Cooperative Practice to the ADR Toolkit."  Her final part in this series -- linked supra -- is the final entry of Guest Blogger Law Professor John Lande’s posts.  Linked here is his article The Promise and Perils of Collaborative Law -- which is also linked in Gini's blog with her comments here.

Before you run over to Gini's site to read Lande's excellent post or his great article, I'd like to simply bullet-point some observations based upon my four-years of full-time mediation and arbitration practice.

• when I co-arbitrate with some of the best commercial arbitrators in the business -- these are Ivy League lawyers with many decades of experience representing Fortune 50 Companies in AmLaw 100 Law Firms, the ultimate decision changes many times during the course of deliberations and almost always could go either way.
• having spent a considerable time in the Los Angeles Complex Court as an experienced commercial litigator "externing" for credit to earn my LL.M in '06, I can tell you that the deliberations in chambers of these highly respected jurists is not much different that those in which I have engaged when sitting on an arbitration panel

The take away?  No matter who is hearing your case, your chances of winning are 50-50.  Flip a coin.  Think this doesn't apply to you?  I have arbitrated cases being handled by the top ten law firms in the country.  I have seen those same type of firms litigate and try cases in the Complex Court.  It's 50-50 friends.

Here's from Lande's series:

In mediation, an impartial third party helps parties to negotiate an agreement. In Collaborative Law, at the beginning of a case, lawyers and parties sign a “participation agreement” to negotiate in good faith and disclose all relevant facts. The participation agreement includes a “disqualification” clause which provides that if any party decides to litigate, the Collaborative lawyers are disqualified from representing the parties, who must hire new lawyers if they want representation in litigation. The formal difference between Cooperative Practice and Collaborative Practice is that Cooperative Practice participation agreement does not include the disqualification provision.

...

Since a Cooperative process does not include a disqualification clause as in Collaborative cases, some people wonder if Cooperative process is any different from negotiation in litigated cases.

Although many lawyers negotiate cooperatively at times, a Cooperative process can provide greater predictability and confidence than in litigation. DCI members say that a Cooperative process creates a legal culture where cooperation is the norm. Traditional litigation-oriented practice normally does not involve an explicit process agreement. In litigation, lawyers often are not sure about the other side’s intentions and each side may feel that it needs to take tough positions to protect themselves. This sometimes creates a cycle of adversarial behavior that is hard to break out of.

I appreciate new approaches to the practice of law, I really do. But I both (1) don't agree all litigation is 50-50 and (2) fail to see how any of the above is different from good legal practice.

Regarding the first, I'm always suspicious of anything meant to be more persuasive by the inclusion of such terms as "Ivy League" and "top ten." You can see my post about the real motivations of General Counsel for some of the reasons I'm suspicious, given how none of them are immune from completely dropping the ball, obliterating their client's interests.

More importantly, I refuse to believe that any case is 50-50, much less all of them. It is absolutely true that anything could happen at trial and that slamdunk cases lose every day. It is also true that a rational argument can be made for almost anything, and that a factfinder, judge, mediator, arbitrator, or any other neutral would be derelict in their duty if they did not give serious consideration to the arguments made before them.

That said, in the real world people are innocent or guilty. People make mistakes or don't make mistakes. What they did was outrageous or it was not. Are there gray areas? Sure. That's why the law includes explicit burdens of proof and persuasion. In a criminal case, if a factfinder has a doubt about guilt that is founded in reason, they should return an innocent verdict. In a civil case, if a plaintiff has proven their claims are more likely true than not, the jury or judge should return a verdict in the plaintiff's favor.

Have you ever seen a situation in life in which, after complete consideration, you were still totally unable to reach any conclusion? Were you really Buridan's donkey? Spinoza doubted any rational person could find themselves in such a situation and I agree. If you can see a wide array of evidence and argument, which it is your sworn duty to evaluate, and yet you remain totally unmoved, then the problem lies with you, not with the inherent unknowability of the world.

Regarding the second, any plaintiff or defense attorney who truly has their eye on the client's interest will always keep in mind the possibility of resolving the matter. Just like I said above, slamdunk cases lose every single day of the week. I'm sure defense attorneys can chime in that completely frivolous cases can return extraordinary verdicts.

A good lawyer always has that in mind, as well as the financial and emotional cost of litigation. If referring to that process of continual re-evaluation and resolution as "cooperative law" makes it more likely to happen, then that is certainly a benefit to the profession, but litigators and trial lawyers shouldn't be told they're doing it wrong just because they don't use the name.

Same with "collaborative law." If the clients are willing to disclose everything upfront, then by all means we should take all steps to facilitate their resolution. Yet, I have to believe that such openness can only come from the clients, and then only for reasons external to the litigation itself. Disputes simply don't up and resolve themselves by changing the name of the process.

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Martin Lipton, who knows a thing or two about corporations, presents:

On June 25, I presented a paper entitled “Shareholder Activism and the “Eclipse of the Public Corporation”: Is the Current Wave of Activism Causing Another  Tectonic Shift in the American Corporate World?” at the 2008 Directors Forum of The University of Minnesota Law School. The paper discusses the pressures that have been pervasively eroding the centrality of the board of directors and transforming its role in the governance structure of public companies, with the end game being a new conception of the corporate organization. Against the backdrop of the subprime and leveraged loan financial crisis and other recent events, the paper addresses what I regard as the crux of the issue affecting public companies today: whether the institution of the corporate board can cope with these pressures and survive as the vital governing organ of public companies. Or, will a forced migration from director-centric governance to shareholder-centric governance, along with a concomitant transformation of the role of the board from guiding and advising management to ensuring compliance and performing due diligence, simply overwhelm American business corporations?

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Via an insurance / breach of contract case in the United States District Court for the Western District of Pennsylvania:

Although the Court has found that Hotaling's contacts  [*18] with Pennsylvania are sufficient to support the Court's exercise of personal jurisdiction, it does not follow automatically that venue in this district is proper. As the language of Section 1331(a) makes clear, the focus in assessing venue is not on the "defendants' 'contacts' with a particular district, but [on] the location of those' 'events or omissions giving rise to the claim.'" Cottman Transmission Sys. v. Martino, 36 F.3d 291, 294 (3d Cir. 1994). In order to establish specific jurisdiction, a plaintiff must show only that at least one contact on the part of the Defendant related to the Plaintiff's claim. O'Connor, 496 F.3d at 318 (citing Helicopteros, 466 U.S. at 414). The inquiry with respect to proper venue, however, is significantly more circumscribed, requiring a showing that a substantial part of the events or omissions giving rise to the claim occurred in the district. 28 U.S.C. § 1331(a)(2).

Pullman Fin. Corp. v. Hotaling, 2008 U.S. Dist. LEXIS 48359 (W.D.Pa. June 24, 2008). Defense motion for transfer of venue granted.

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The WSJ Law Blog on a malpractice suit, alleging that discovery mistakes led to a $107 million settlement [to which] the company would not have otherwise agreed:

According to the complaint, the North Carolina federal court in which the underlying litigation occurred, held that it was “under Kaye Scholer’s watch” that Celanese was sanctioned for “discovery abuse,” which the Court described as “egregious.” The North Carolina court, as quoted in the complaint filed against Kaye Scholer, wrote: “The court is not unmindful of the positions urged by [Celanese], but in the context of the trove of documents it held in the wings just out of sight of the non-class plaintiffs, these positions can’t be seen as coherent or compelling.”

In a June 2006 order, a North Carolina judge sanctioned Celanese $114,000 in fees and expenses, but said he would consider further sanctions on evaluating the impact of the discovery misconduct. An October 2006 sanctions motion by plaintiffs asked for a range of findings against Celanese, according to the NYLJ, including one that the company acted in bad faith and that an adverse inference should be drawn against it on key issues.

The judge said he would evaluate the need for such sanctions as the case proceeded. Celanese said in its suit that the prospect of sanctions that would have hampered its ability to defend itself at trial forced it to enter into a settlement in May 2008.

Hmmm. That is a tough argument. While an actual order instructing the jury to draw an adverse inference against the company would have prejudiced its interests, it is hard to say that a motion requesting an order is a but for cause of an unfavorable settlement.

Obviously, in the real world settlement takes place in the totality of circumstances, and I'm sure the pending motion was on their minds, but I have serious doubts that the motion would itself cause the defendants to settle for over $100 million.

I am willing to bet the documents withheld by Kaye Scholer were devastating to Celanese (otherwise, why withhold them?); once the plaintiffs had them, it was simply a discussion of numbers, with or without the adverse inference.

Moreover, an adverse inference would not have, standing alone, "hampered its ability to defend itself at trial." It would merely have been a unfavorable jury instruction at the end of trial, one that defense counsel would be permitted to argue to the jury was inappropriate because it was the lawyer's fault, not the client's. Every day in America defendants blame their lawyers at trial -- what would have stopped them here?

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At Electronic Discovery Blog, "Employee’s motion to quash granted where employer cannot establish that employee had no expectation of privacy in using employer’s computer system:"

Requestor defendant employer subpoenaed third party producer to produce “all electronically stored information on all computers, laptops, PDA’s, portable media or other devices” between plaintiff employee’s husband and plaintiff regarding the litigation. Employee moved to quash on the grounds of overbreadth and that the records were protected by the spousal privilege. Employer responded that the records were not protected because of the employer state’s system use policy, which provides that “’no user should have any expectation of privacy in any message, file, image, or data created, sent, retrieved, or received by use of the Commonwealth’s equipment and/or access’” and “that state agencies have the right to monitor e-mail sent or received by agency users;” although the policy did permit personal use of work computers. Employer stated that as both employee and her husband were employees of the state at the time, the policy prevented any expectation of privacy. Id. at *3-*4.

...

In the current case, there was “no…evidence…offered as to knowledge, implementation, or enforcement of the Policy:”

There is no showing that Mr. or Mrs. Sprenger were notified of the Policy by a log-on banner, flash screen, or employee handbook and whether Mr. or Mrs. Sprenger were ever actually aware of the Policy. It is unclear whether third parties had a right of access to the e-mails. The record also does not show whether the Policy was regularly enforced and whether the state employees’ computer use was actually monitored.

Id. at *13. The employer thus failed to meet its burden demonstrating employees’ waiver of the privilege. The court therefore granted the employee’s motion to quash, although inviting the employer to contact the Clerk of the Court to set up an evidentiary hearing on the waiver issue of they sought to pursue the matter further.

EDD notes that conflicts with U.S. v. Etkin, 2008 U.S. Dist. LEXIS 12834 (S.D.N.Y. Feb. 20, 2008), where the marital communication privilege could not be claimed in a different, but awfully similar, situation.

There is a serious conflict brewing here, one that I believe will inevitably end up in the Supreme Court.

On the surface, the question appears to be if e-mails sent from a work account can be privileged in a world in which an employer is free to monitor such e-mails, thereby eliminating any expectation of privacy (which is required to claim privilege).

Looking deeper, though, there is an even more basic question: who bears the burden of persuasion may in a privilege? In some sense, the answer is simple. Since a lack of expectation of privacy is generally thought of as a waiver of privilege, the burden is on the party requesting the information to show such privilege was waived. That's what was done in the case at bar.

But that interpretation is not set in stone. The burden of establishing any privilege at all lies with the party trying to raise the privilege, and there is a good argument that, where the communication began on the employers computer system, it was never privileged to begin with, and thus we never even reach the question of waiver.

In Pennsylvania, Nationwide Mut. Ins. Co. v. Fleming, 924 A.2d 1259 (Pa. Super. Ct., May 21, 2007), clearly requires the party claiming the privilege first establish the communication was privileged -- and as part of their analysis the court looked into the recipients of the email. A court could hold that, in a work email situation like the one at the beginning of this post, the email starts its life unprivileged, and so there's no issue of waiver at all. That would put the burden on the party claiming the privilege, rather than the party requesting the document.

Either way, clients should be encouraged to play it safe and not send e-mails relating to personal legal matters from work accounts. Ask your clients about it today.

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Kudos to David Boies:

Fresh off his depiction in “Recount” — the HBO movie about the 2000 election fiasco — David Boies, along with partner Don Flexner, have, on behalf of American Express, negotiated one of the largest antitrust settlements ever for an individual company: $1.8 billion. The settlement with Mastercard comes on the heels of a similar $2.25 billion settlement, also handled by Boies, between AmEx and Visa.

The background: The Supreme Court ruled in 2004 that Visa and MasterCard violated antitrust laws by prohibiting their member banks from offering credit cards that could be used on rival payment networks. AmEx and Discover sued. Here are reports from the WSJ and NYT.

Really, though, kudos to Mr. Feinberg:

Kenneth R. Feinberg, who handled the earlier settlement with Visa and who also oversaw administration of the 9/11 compensation fund, acted as arbitrator in the case during secret negotiations that lasted eight weeks.

And while we're at it, don't forget to review the AAA rules for large, complex commercial disputes. There are two myths about commercial arbitration worth dispelling while on the subject.

First, you are generally not entitled to three arbitrators; you can ask for them, but the only time you'll get them is if you and the other party cannot agree on arbitrators and the case is worth more than $1 million.

Second, there is no rule prohibiting discovery in commercial arbitration, there just isn't any entitlement to it. I frequently recommend following the Federal Rules of Civil Procedure with regard to written discovery, except for depositions, which are limited usually to just the principle witnesses.

Of course, the best part of arbitration from the plaintiff's perspective is the finality, where the pressure of an unappealable award strongly encourages settlement. When you litigate a case through the civil system, there is virtually no chance of settlement prior to scheduling of trial, and, indeed, a good number of cases have to get through verdict and at least some of the appeal before the offers become reasonable. That takes years.

As you can see from the AmEx arbitration, nearly $2 billion dollars changing hands took eight weeks.

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After my prior post, I caught this breakdown at AmLawDaily:

The decision comes 19 years after the Exxon Valdez tanker spilled 11 million gallons of oil into the Prince William Sound off Alaska. A jury in 1994 imposed $5 billion in punitive damages against what is today Exxon Mobil Corporation. Since then, the award has bounced back and forth between the district court in Alaska and the Ninth Circuit, which in 2007 cut the already-reduced $4.5 billion punitive award to $2.5 billion.

The Supreme Court's ruling limits any award to no more than $507.5 million, which includes the $287 million in compensatory damages from the trial as well as other settlements. It also remanded the case to the Ninth Circuit for further consideration.

A final award would include 5.9 percent annual interest starting from late September 1996, bringing a maximum possible award today to about $995 million. More than 32,000 Alaskans stand to get a share of the award.

The lead firm, Davis Wright Tremaine, which put in the most time, tops out at $28 million, which doesn't include costs.

Perhaps the Supreme Court would like to extend its boundless mercy to the "unpredictability" of representing the victims of willful, wanton and reckless conduct? Why not a due process rule requiring the defendant subsidize the plaintiffs' appeal work -- as it is performed, not decades later -- until the defendant prevails on the merits?

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From the Exxon v. Baker decision, which, under federal maritime law (foreshadowing future rulings on state civil law), cut a $2.5 billion punitive damages award down to $500 million, for a 1:1 ratio with compensatory damages:

The common sense of justice would surely bar penalties that reasonable people would think excessive for the harm caused in the circumstances.

Obviously. That's why we have juries, trial judges, appeal judges, and state supreme court judges to determine and review punitive damage awards. A jury, of course, is in far better position than an appeal judge years later to assess the real circumstances, being how they actually sit in the presence of the witnesses and, after swearing an oath, fairly consider all the evidence.

But the above quote is just a throwaway line, unconnected to any reasoning or holding. The Supreme Court actually held:

The real problem, it seems, is the stark unpredictability of punitive awards. Courts of law are concerned with fairness as consistency, and evidence that the median ratio of punitive to compensatory awards falls within a reasonable zone, or that punitive awards are infrequent, fails to tell us whether the spread between high and low individual awards is acceptable. The available data suggest it is not. A recent comprehensive study of punitive damages awarded by juries in state civil trials found a median ratio of punitive to compensatory awards of just 0.62:1, but a mean ratio of 2.90:1 and a standard deviation of 13.81.

Even to those of us unsophisticated in statistics, the thrust of these figures is clear: the spread is great, and the outlier cases subject defendants to punitive damages that dwarf the corresponding compensatories.

I have a proposal: would all persons who, in the future, are going to engage in intentional, wanton, willful, or reckless conduct, agree now to do so in a predictable fashion?

Seems to me the "real problem" is that life is complicated and -- shockingly -- unpredictable. It's no surprise that different defendants, in different cases with different facts, will be punished differently. It's also no surprise that a jury will find a given number sufficient to deter wrongdoing in one circumstance is insufficient to deter wrongdoing in another circumstance.

Confining and directing the method by which punitive damages are determined is appropriate; no one should be railroaded to punishment, or punished for conduct or harm unproven in court.

Arbitrarily asserting that punishment is not permitted to be as variable as the underlying conduct that was punished, however, is unconscionable.

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A question about employment discrimination in Pennsylvania:

I have recently been terminated from my place of employment. The reason give was failure to ring up my employee meal, which I did once brought to my attention. A manager was not around to do so at the time. They have been cutting back my hours for months and switching my duties from one area to another. I feel that I have been wrongly terminated and believe it is because I am 8 months pregnant. Is this just?

My response:

It is unambiguously illegal to discriminate against employees on the basis of pregnancy, childbirth or a related medical conditions [under the Pregnancy Discrimination Act, part of Title VII of the Civil Rights Act of 1964]. From what you wrote, which describes disparate treatment of you compared to others, it sounds like you may have well been discriminated against.

You should know that employment discrimination claims often have a very narrow window to file (such as with the Equal Employment Opportunity Commission), often just 180 days after the event in question, and so you should contact an attorney promptly.

...

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West Virginia Business Litigation details an interesting case:

The lawsuit alleges that Frank, a former West Virginia Grand Master, was expelled from the Masons as a result of his successful efforts to reform the organization and eliminate practices that were, at best, anachronistic and, at worst, illegal ...

Plaintiff Haas' goal was to make Masonry more tolerant, friendly, decent and accepting of everyone regardless of nationality, race, religion or disability. ...

The lawsuit raises questions about membership in a fraternal organization, such as whether a member is entitled to due process if he is to be expelled from the membership, and, if so, what type of due process.  

But I think the more important question presented by the action is the public policy aspect: can an organization, even one that is private and fraternal, take punitive action against a member for activities that are intended to rid the organization of illegal or unethical practices?  I would hope the answer is no, but that’s what the lawsuit will decide.

At least in Pennsylvania, the Pennsylvania Human Relations Act holds:

§ 953. Right to freedom from discrimination in employment, housing and public accommodation.

The opportunity for an individual to obtain employment for which he is qualified, and to obtain all the accommodations, advantages, facilities and privileges of any public accommodation and of any housing accommodation and commercial property without discrimination because of race, color, familial status, religious creed, ancestry, handicap or disability, age, sex, national origin, the use of a guide or support animal because of the blindness, deafness or physical handicap of the user or because the user is a handler or trainer of support or guide animals is hereby recognized as and declared to be a civil right which shall be enforceable as set forth in this act.

Would the Masons count as a "public accommodation?" That generally depends on if it's open to the public, a question much harder to answer than you'd think. Here's Wikipedia on admission:

Generally, to be a regular Freemason, a candidate must:^[20]

• Be a man who comes of his own free will.
• Believe in a Supreme Being. (The form of which is left to open interpretation by the candidate)
• Be at least the minimum age (from 18–25 years old depending on the jurisdiction).
• Be of good morals, and of good reputation.
• Be of sound mind and body (Lodges had in the past denied membership to a man because of a physical disability, however, now, if a potential candidate says a disability will not cause problems, it will not be held against him).
• Be free-born (or "born free", i.e. not born a slave or bondsman).^[50] As with the previous, this is entirely an historical holdover, and can be interpreted in the same manner as it is in the context of being entitled to write a will. Some jurisdictions have removed this requirement.
• Have character references, as well as one or two references from current Masons, depending on jurisdiction.

Deviation from one or more of these requirements is generally the barometer of Masonic regularity or irregularity. However, an accepted deviation in some regular jurisdictions is to allow a Lewis (the son of a Mason),^[51] to be initiated earlier than the normal minimum age for that jurisdiction, although no earlier than the age of 18.

Seems awfully public to me, which would make the law apply. Eagle-eyed law students, though, will note that Boy Scouts of America v. Dale interprets the First Amendment as superseding these "public accommodations" laws where necessary to protect expressive freedom, and on the face of it I can't see how the Masons' discrimination would be different from the Boy Scouts'.

The same analysis would thus likely apply to West Virginia -- making the Masons' original conduct that Haas tried to reform protected, rather than illegal, and they can say they fired him for deviating from their expressive message. Similarly, the United States Constitution, where applicable, trumps Haas' state-law tort claims (defamation, etc).

 

I underline "where applicable" to emphasis that, just because there's a Constitutional right in the vicinity of the facts at issue doesn't automatically mean the conduct is protected. The Masons could very well have gone beyond mere protection of their expression into intentionally harmful conduct, which isn't protected at all.

Indeed, the Boy Scouts are a good example -- their victory in Dale translated into the City of Philadelphia revoking the free rent they had enjoyed on Philadelphia City property. Again, the right to express yourself doesn't automatically translate into, say, the right to enjoy a tax break.

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From Wartsila Nsd N. Am., Inc. v. Hill Int'l, Inc., 2008 U.S. App. LEXIS 13099, a business litigation opinion just released:

Three exceptions have been identified where the public interest will render an exculpatory clause [in a contract] unenforceable: (1) when the party protected by the clause intentionally causes harm or engages in acts of reckless, wanton, or gross negligence; (2) when the bargaining power of one party to the contract is so grossly unequal so as to put that party at the mercy of the other's negligence; and (3) when the transaction involves the public interest. Wolf, 644 A.2d at 525-26. None of these exceptions is applicable here.

Although the jury concluded that Hill was negligent, there was no evidence that Hill engaged in willful misconduct, such as "intentional harms" or "the more extreme forms of negligence, i.e., reckless, wanton, or gross." Id. at 525. At trial, Wartsila argued that Hill violated the Agreement by committing fraud. The jury expressly concluded in its verdict, however, that Hill had not committed fraud. This finding eviscerates any argument that the exculpatory clause should be disregarded because of the nature of Hill's alleged misconduct.

To get around the exculpatory clause, all the plaintiff had to do was prove the defendant's conduct was reckless, wanton, or grossly negligent. Yet, apparently they only asked the jury if the defendant was negligent or if they committed fraud.

It is thus entirely possible that every single juror thought the defendant was grossly negligent, a factual finding that would have destroyed the exculpatory clause, a yet on the facts presented to the Third Circuit plaintiff's claim has been "eviscerated."

Oops.

Continuing on:

The District Court erred in failing to exclude evidence of "incidental,  special, indirect, or consequential" damages. Further, the Court did not ask the jury to identify which portion of its award was based on Hill's breach of contract or its alleged negligence. Thus, we cannot tell from the jury's verdict what portion of its award of damages was based on direct damages and what amount was based on consequential damages. In order to give effect to the exculpatory clause agreed to by these parties, there must be a new trial on the issue of damages.

Again, the jury could have already answered this question, but now the parties have to go back for new trial, and the plaintiff is denied resolution and compensation another day.

Maybe that is in their best interest, since they just had the exculpatory clause enforced as a matter of law, and now they can focus their case on the permissible damages. Somehow I doubt that was their plan all along...

UPDATE: See Philly JD's comment below -- the outcome is even worse than I thought, as the final verdict is now capped at a level that makes re-trial unprofitable for the client and the attorney.

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From National Law Journal. Best I can tell these are all trial strategies, despite the article referring to the attorneys as "litigators." There also seems to be a bias towards business lawyers; even the criminal defense is business-oriented.

Nonetheless, worth a read, not least because there's nothing new about any of them. It's the same stuff you learn in any trial advocacy program, like:

• humanize your client and get their story (not just their 'position' or 'claim / defense' in front of the jury)
• give misleading witnesses enough rope to hang themselves
• "I learned that lawyers better be straight with that jury. Don't mislead 'em, don't con 'em. Don't be too slick. Don't be slick at all."
• have a single, simple, coherent theory of the case

They're cliches and maxims for a reason: they work.

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An Eastern Pennsylvania civil litigation question:

can someone who says they are owed money win in court without proof and what kind of proof would they need

I reply:

You need just enough proof to win your case: no less, no more.

Seriously, there's only a small subset of cases -- generally those relating to real estate or long-term agreements -- where a particular type of proof, like a written contract, is required. (Those cases fall under the "statute of frauds," which really is just a list of a dozen or so particular circumstances).

For every other breach of contract, like an agreement to buy equipment, or an agreement to do some minor contracting work, there's no legal requirement the plaintiff show a writing to prove their claim.

Is a writing more persuasive than just oral testimony? Usually. But it's not a legal requirement. The only 'legal' requirement in most cases is that you show, through first-hand knowledge (e.g., your testimony or someone else's) that you're entitled to the money you claim. Then a judge or jury will consider your testimony and the defendant's and reach a factual conclusion.

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At New York Attorney Malpractice Blog:

How Do You Forget to File a $19 Million Legal Malpractice Case?

Chicago Business Litigation Lawyer Blog reports that a huge class action legal malpractice case against DLA Piper Rudnick has been dismissed.  Plaintiff's and defendants had entered into a tolling agreement that was amended and went on for several years.  This case was valued at over $ 19 million dollars.  After several amendments of the tolling agreement plaintiffs started the case, but the court determined that it was started a year too late!  Joyce v. DLA Piper Rudnick ended in dismissal.

The easiest and most common way to commit legal malpractice is to fail to file or fail to prosecute. Now the plaintiffs' lawyers themselves are likely on the hook.

The easiest way I know of to avoid that is to create tickler and to-do systems. The moment something comes in, put it in the system. I just have to look at my calendar to know when I'm hitting a deadline, since I put it in the moment the motion, case, whatever came in.

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If you're looking for contact information, please go to my Contact page.

The Beasley Firm's main website also profiles our Areas of Expertise.

The Beasley Firm typically represents plaintiffs in civil litigation and trials in Pennsylvania, New Jersey, Delaware and, on occasion, Washington, DC, and New York City. We take difficult plaintiffs' cases and see them all the way through investigation, filing, pleadings, discovery and trial, and through appeal and re-trial, too.

The Beasley Firm is a full-service civil litigation and trial law firm with a forty-year history of excellence. Our reputation as trial lawyers is unparalleled, with multiple record-setting verdicts, and the record (held by the founder) for million-dollar verdicts by a single attorney. Slade McLaughlin and I set a new verdict record -- for punitive damages in a Pennsylvania medical malpractice case -- in May of 2008.

The Beasley Firm is unique in that it has many attorneys who specialize in particular areas like automobile accidents or medical malpractice, multiple appellate attorneys, and many general practitioners who focus on cases that don't fit the normal pattern, all under one roof that retains the nimble energy of a boutique firm where everyone knows each other and bounces ideas off one another. We adapt as the case demands; if a case needs a dozen attorneys and assistants, it gets them.

Most firms put up lists of the types of cases they work on; it's hard to do that for us. In the past year we've worked on automobile accidents, aviation accidents, breach of contract breach of fiduciary duty, business torts, civil rights, commercial litigation, copyright infringement, defamation, dram shop, employment discrimination, fraud, insurance coverage / bad faith denials, medical malpractice, private equity / shareholder disputes, personal injury, product liability, wrongful death, and wrongful use of civil proceedings / abuse of process cases.

We use alternative dispute resolution methods like mediation frequently and have experience in commercial arbitration, including large, complex commercial disputes.

My practice is largely unlimited -- at any given time, I generally have multiple cases representing people who have been physically injured in accidents or through medical malpractice, and multiple cases representing people and businesses who have been financially injured through breaches of contract, breaches of fiduciary duty, or downright fraud.

If you think you have a case, please contact our offices for a case review. We don't charge to review cases and we generally represent plaintiffs on a contingent fee, where our fee depends upon our success. Please see the Contact page for contact info.

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Maxwell S. Kennerly is a civil litigation and trial attorney at The Beasley Firm in Philadelphia, Pennsylvania.

I represent plaintiffs in civil litigation, people and businesses who have been harmed by someone else. My litigation practice is unlimited: I represent individuals who have been physically injured by accidents or malpractice and businesses that have been financially injured through breaches of contract or fraud.

Our firm represents most of our clients on a contingent fee basis. Our firm's cases are typically in the Pennsylvania, New Jersey and Delaware counties near Philadelphia, but our general work extends West to Pittsburgh, North to New York City, and South to Washington, DC. For certain types of cases, we partner with other firms to extend our representation nationwide.

Unfortunately, on the Internet, nobody knows you're a dog, and it's hard even for lawyers to distinguish one lawyer or firm from another based on little more than unverifiable claims on a website. The Beasley Firm's legacy speaks for itself. I was selected by Super Lawyers magazine as a Pennsylvania Rising Star; here's a selection of some of the cases that I am actively litigating as of 2010:

• multiple wrongful death actions on behalf of individuals killed while serving as civilian contractors in Iraq and Afghanistan;
• multiple catastrophic injury cases arising from gross negligence in the operation of aircraft and marine vessels;
• multiple defamation claims against The Philadelphia Inquirer, The Philadelphia Daily News, and The Northeast Times;
• a False Claims Act case against several nationwide government contractors;
• a suit against a federal agency alleging constitutional violations and violations of the Administrative Procedures Act;
• multiple legal and medical malpractice suits;
• a bankruptcy adversarial proceeding to fight the discharge of a $20.5 million verdict;
• a racketeering suit against a multinational bank that secretly withdrew investors' funds to cover its own losses. 

I also do a limited amount of work on behalf of defendants; for example, I represent a small, family-owned business in a patent infringement suit brought by a company that exists primarily to bring lawsuits.

I am fortunate that The Beasley Firm encourages pro bono work, and I am on the First Judicial District's Pro Bono Honor Roll. I make a priority to have at least one, and preferably more than one, active pro bono case at any given time.

I also teach Continuing Legal Education seminars and have contributed to legal publications such as The Jury Expert and non-legal publications such as Emergency Physicians Monthly.

If you're considering contacting us about legal representation, please visit my Services page or visit The Beasley Firm's Areas of Expertise. If you're looking for contact information, please go to my Contact page.

If you're looking for more content, I also have a Twitter feed, I share Google Reader links, and I share interesting legal stories on Friendfeed. My blog posts, tweets, and shared links all show up together on my Friendfeed page.

The rest of this page is my standard legal biography (the same type of information you find on most lawyer's websites) plus several questions and answers about the site.

 

Standard Legal Biography

Maxwell S. Kennerly litigates and tries cases in fields as varied as business torts, civil rights, copyright and patent infringement, racketeering, qui tam, defamation, insurance coverage / bad faith, personal injury, professional malpractice, and wrongful death. He has represented a wide variety of clients, including doctors, lawyers, police officers, whistleblowers, retirees and university professors against a wide variety of opponents, including health insurance companies, multi-national banks, national publications, private military contractors, the City of Philadelphia, the Commonwealth of Pennsylvania, and the United States government.

Max was graduated from Yale University with Honors in History and from the Beasley School of Law at Temple University as a Law Faculty Scholar and a member of the Rubin Public Interest Society. While at the Beasley School of Law, he served as a Teaching Assistant in Constitutional Law to Dean Robert Reinstein. He also served in the Federal Clerkship Clinical Honors Program directed by Judge Dolores K. Sloviter of the Third Circuit Court of Appeals, during which he clerked for Chief Magistrate Judge M. Faith Angell of the Eastern District of Pennsylvania. He returned to the school to become a Fellow of the Academy of Advocacy.

 

Frequently Asked Questions

What's a weblog?

A weblog, or "blog," is a website comprised of short entries displayed in chronological order and organized by subject matter. It's like a public journal.

The internet hosts millions of these weblogs, covering virtually every subject imaginable. If you're looking for weblogs, the best of the large-readership blogs can be found among the winners and nominees of the annual Weblog Awards, as well as the "Top Favorited" and "Top" weblogs at Technorati (here's a list, sorted by topic, of the Technorati 100), or the Alltop weblog aggregator. If you want to find quality niche blogs, you should look through old blog carnivals for a given subject.

You can also dive right into the ocean and find whatever you're interested in via one of the search engines listed at Blog Search.com.


What's this weblog about?

This site is a "legal" weblog, sometimes unfortunately called a "blawg." There are about 2,000 active "blawgs" in the United States, listed at places like Blawg.com, Justia.com, and the former 3L Epiphany.

As a lawyer I typically represent plaintiffs in civil litigation and at trial, and that's the focus of this weblog. This weblog is geared towards lawyers, law students, and people interested in the law. Most of the posts talk about the details of litigating and trying cases. Non-lawyers may be interested in the posts discussing the law for non-lawyers, in the posts about productivity & office management, and the brain food.


I only care about some of the issues you post about, and I only like some of your posts, what should I do?

That's the beauty of weblogs. I recommend you get a "feed reader" (I use Google Reader with extensions, and there are dozens of other feed readers), subscribe to every weblog you find interesting, then skim through the titles and read only what you like. You waste minimal time on the content you don't want while catching most of what you do want.

My Google Reader says I have over 300 subscriptions, sending me over 2000 posts a day. I skim the titles of most of these posts and read, on average, 100 posts a day. I don't think I'm going overboard, and it really doesn't take that long. For comparison, tech-blogger Robert Scoble reads 622 feeds a day and Lyndon Johnson supposedly read the Congressional Record and all the major Washington newspapers every day.


Do you provide legal advice?

I do, but not through this site. I don't know of any lawyers who offer legal advice through their website or weblog. You shouldn't take anything you read on the internet to be legal advice.

The discussions you see here aren't any different from reading a newspaper or magazine article by a lawyer or watching a lawyer on a television show talk about a case. I might write about a legal issue relevant to your situation, but professional legal advice requires an in-depth discussion with you about your case, a thorough investigation into all the relevant facts, and substantial research into the relevant laws.

If you think you have a case, I'm happy to review your situation free of charge. You can call, write, or email me at the following:

Maxwell S. Kennerly, Esquire
The Beasley Firm
1125 Walnut Street
Philadelphia, PA 19107
max.kennerly@beasleyfirm.com
(215) 592-1000

If you call, the quickest way to start the process is tell the receptionist you think you have a case and would like to speak with Patti or Paula.

Most importantly, if you think you have a case, contact a lawyer as soon as you can! There are all kinds of time restrictions that can affect your legal rights if you don't act soon enough.


How do I find a lawyer?

You can ask me; if for whatever reason I don't take your case, I'm happy to refer you to other experienced attorneys that I know and trust to handle cases diligently and competently.

The standard advice is: ask the people you know! Do you know anyone else who had a similar situation? Ask them who they hired, and what they liked/disliked about their lawyer. Do you trust the opinion of, say, your accountant? Do you know your local politicians? Professionals and politicians frequently work with lawyers, and they'll likely know a lawyer who can help you, or at least a lawyer who knows a lawyer who can help you.

Did you work with lawyers when you bought your house? When you were involved with an estate? When you got a permit to do contracting work? Do you know any police officers or court staff? These people, too, will likely know lawyers who can connect you with the lawyers you need.

Do you know or respect any local judges or professors at the law school? Most judges and law professors feel a dedicated to ensuring access to legal counsel, they know plenty of lawyers, and they'll take the time to refer you to the lawyer they believe will best represent your interests.

Spend some time thinking about it - chances are you know a lawyer, or someone who knows a lawyer, or someone who knows someone who knows a lawyer.

If you come up short, or simply don't like your choices, you can call your county and/or state Bar Association, both of which likely have lawyer referral services.


Can you give me some examples of your work?

Usually, no. The rules governing lawyers strictly limit what we can say about our work. Here in Pennsylvania (see the Rules) multiple Rules of Professional Conduct govern:

• Rule 1.6 imposes a broad duty of confidentiality on everything relating to the representation;
• Rule 7.1 imposes a duty on lawyers to make sure statements about themselves and their services could not be misleading when interpreted as a whole;
• Rule 7.2 prohibits
  • paying anyone for recommending a lawyer,
  • endorsements by celebrities or public figures,
  • endorsements by anyone without disclosing compensation,
  • re-enacting situations, or having actors portray clients,
  • any "written communication" without disclosing the geographic location where the work will be performed,
  • paying, "directly or indirectly," for advertisements for other lawyers,
  • advertising that a lawyer or firm has a practice limited to particular types of cases unless they handle all aspects of those cases from intake through trial.
• Rule 7.3 prohibits in-person, telephone or  "real-time electronic communications" with a prospective client unless they initiate it; and
• Rule 7.4 prohibits lawyers from calling themselves a "specialist" except in particular circumstances.

In addition, numerous Pennsylvania Supreme Court opinions have frowned upon lawyers showing public documents used in litigation to third parties, even when that third party could have just gone to the courthouse and picked up a copy.

Sometimes, I can give broad descriptions of results or public hearings / trials. That's about it. The most impressive parts of any lawyer's work -- the dedication, the compassion, the foresight -- usually remains private forever.

I try to be careful with what I say. Please don't assume any comment here relates specifically to any particular case I worked on, or is a guarantee of any particular result, or is some type of warranty or representation about what the law is.

As I wrote above, this weblog is intended to be no different from, say, a column in a legal publication. Those columns don't guarantee results, don't provide legal advice, and don't perform any other professional service. They're solely part of the public debate. A weblog is just a different form of that. As with everything else online, use your common sense and take it all with a grain of salt.

 

What about the copyright for the content of this blog? 

 

Litigation and Trial Blog by Max Kennerly is licensed under a Creative Commons Attribution-Share Alike 3.0 United States License.

A similar license was recently upheld by the Court of Appeals for the Federal Circuit. Congratulations to all the hard working lawyers and technology professionals who made it happen.

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