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

Via Sports Law Blog, I saw a new paper: Aaron Zelinsky, The Justice as Commissioner: Benching the Judge-Umpire Analogy, 119 Yale L.J. Online 113. [After writing this post, I saw the WSJ Law Blog covered it, too.]

Here's the abstract:

The judge-umpire analogy has become “accepted as a kind of shorthand for judicial ‘best practices’” in describing the role of a Supreme Court Justice. However, the analogy suffers from three fundamental flaws. First, courts historically aimed the judge-umpire analogy at trial judges. Second, courts intended the judge-umpire analogy as an illustrative foil to be rejected because of the umpire’s passivity. Third, the analogy inaccurately describes the contemporary role of the modern Supreme Court Justice. Nevertheless, no workable substitute for the judge-umpire analogy has been advanced. This Essay proposes that the appropriate analog for a Justice of the Supreme Court is not an umpire, but the Commissioner of Major League Baseball.

I agree with his argument regarding Supreme Court Justices. Given the Justices' policy-making focus and their practice of deciding cases based on the long-term consequences rather than the particular facts of the case, the umpire analogy makes little to no sense for them.

But that's not the whole story. The judges-as-umpires analogy does not work for trial judges either, because the analogy downplays the inherent uncertainty in the law and diminishes the significance and breadth of what trial judges do.

There are a handful of situations in which a trial judge, like an umpire, must draw upon their experience and intuition to quickly exercise discretion in applying a general rule, like when ruling upon evidentiary objections at trial.

Most of the time, however, trial judges have plenty of time to contemplate the issues before them, like when ruling upon motions to dismiss, motions for summary judgment, and motions for post-trial relief — the three most important dispositive motions.

In those instances, the judge is not merely called upon to decide whether or not a pitch was within the strike zone. Indeed, in many situations, the judge is not even asked to decide if the pitch really was within the strike zone (i.e., whether the allegations made by one side are true or false), because they are required to accept the truth of what one of the parties says or of what the jury found. (There are a handful of exceptions, like sentencing decisions, but those, too, are fraught with uncertainty.)

In most situations, the judge is asked to figure out where the strike zone should be. It is as if there were different strike zones for fastballs, breaking balls, and changeups, and the umpire had to determine — based on nothing more the players' arguments about the pitch (i.e., the briefs and the oral argument) — which rule should apply.

But that's not the hard part. In many situations, trial judges must decide not just which rule should apply based on imperfect and incomplete information, but what the rules even are.

Imagine there were different strike zones for different pitches, yet no one agreed what a sinker, curveball, slider, screwball, palmball, or knuckleball even was, and the umpires were supposed to decide which pitch was really used by reviewing dozens of calls by prior umpires, many of which seemed to reach contradictory results and none of which involved the exact same style pitch as the situation at hand.

Making matters worse, imagine, too, that the players themselves don't know for sure what the rules are, and that, after each pitch, the coaches run out to argue over what type of pitch it was.

Does that sound like baseball to you? It sounds like Calvinball to me.

And it sounds like a heckuva game to play.

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Via Overlawyered, Eric Goldman and others favor HR 4364, the “Citizen Participation Act of 2009,” which would establish a federal anti-SLAPP law.

Around half the States have anti-SLAPP (i.e., Anti-"Strategic Lawsuit Against Public Participation") statutes which make it easier to dismiss suits allegedly filed to chill freedom of speech. If the lawsuit arises from the Defendants' exercise of their rights to free speech — which in the post-Citizens United era means virtually every time a corporation advances an agenda — then the Defendant can file, at the very beginning of the lawsuit, a "special motion" that requires the Plaintiff show concrete evidence proving each element of their claims.

The laws make sense, in theory. “The hallmark of a SLAPP suit is that it lacks merit, and is brought with the goals of obtaining an economic advantage over a citizen party by increasing the cost of litigation to the point that the citizen party’s case will be weakened or abandoned, and of deterring future litigation.” United States ex rel. Newsham v. Lockheed Missiles & Space Co., 190 F.3d 963, 972-73 (9th Cir.1999). The purpose of anti-SLAPP laws is to ensure the prompt dismissal of “legally meritless suits filed in order to obtain a political or economic advantage over the defendant, not to vindicate a legally cognizable right of the plaintiff.” Condit v. Nat’l Enquirer, Inc., 248 F. Supp. 2d 945, 952 (E.D. Cal. 2002)(internal quotation omitted). “The paradigm SLAPP suit is an action filed by a land developer against environmental activists or objecting neighbors of the proposed development.” Id.

All well and good. Indeed, anti-SLAPP Acts are sometimes used to dismiss bogus suits in which one side really was trying "to obtain a political or economic advantage" over someone with inadequate resources to defend themselves. See Melius v. Keiffer, 980 So. 2d 167, 170 (La. Ct. App. 2008)(granting motion to strike complaint brought by owners of a bar against area resident who had opposed an expansion of the bar); Lamz v. Wells, 938 So. 2d 792, 794 (La. Ct. App. 2006)(dismissing case filed one week before election by one judicial candidate against another); Darden v. Smith, 879 So. 2d 390, 393 (La. Ct. App. 2004)(dismissing case filed by public official against individual who filed a complaint with the Louisiana Board of Ethics).

Goldman gives his own example where an anti-SLAPP motion allowed a party with limited legal resources to avoid the cost and burden of full-fledged litigation:

All too often, vendors use actual or threatened litigation to take down content that criticizes their offerings. The proposed federal anti-SLAPP law applies to those lawsuits. Thus, if enacted, the federal anti-SLAPP law will help consumers share their true feeling about marketplace offerings with less fear of meritless lawsuits from vendors who would rather fight in court than compete.

BoingBoing’s recent resolution of a lawsuit brought by MagicJack nicely illustrates the virtues of anti-SLAPP laws. BoingBoing blogged some criticisms of MagicJack’s offerings, and MagicJack unwisely responded to that post with a lawsuit. Fortunately for BoingBoing, MagicJack sued it in California, which has a robust anti-SLAPP law. As a result, BoingBoing was able to end the lawsuit early (BoingBoing won its anti-SLAPP motion less than 3 months from complaint filing) and get the court to order MagicJack to pay its attorneys’ fees of over $50k.

But it's not always David using anti-SLAPP laws against Goliath; it's often the other way around.

Consider the BoingBoing case. Let's assume that, instead of suing BoingBoing, MagicJack retaliated by secretly hiring a spam company to inundate BoingBoing and other widely-read blogs with hostile comments questioning BoingBoing's motives and favorably referring to MagicJack.

BoingBoing, having no other options, sues MagicJack.

Would those allegations show MagicJack's "acts" were "in furtherance of the right of free speech?" Sure; MagicJack has just as much a right as BoingBoing to talk about other companies. So the anti-SLAPP Act would be available.*

At the beginning of the case, then, BoingBoing would be required to prove — prior to conducting any discovery, since HR 4364 automatically stays all discovery — that MagicJack was behind the posts, that the posts were false, that the posts were capable of a defamatory meaning, and that MagicJack was at "fault" in publishing the comments (defined in many states as "acting with malice or reckless intent").

How could BoingBoing prove all that immediately after filing suit? Most of that information would be in MagicJack's possession.

Odds are, BoingBoing wouldn't be able to do it. Their case would be dismissed, and MagicJack could continue to harass BoingBoing at will.

The law of unintended consequences, as they say.

Put simply, the problem with HR 4364 is that it's an extraordinarily powerful device — one that substantially increases the costs of bringing meritorious cases and will undoubtedly result in the inadvertent dismissal of many meritorious cases — with few limitations on its use.

Often the only means that "David" has to challenge "Goliath" is through a lawsuit, like when ordinary individuals are powerless to repair the damage caused by sloppy or sensationalized journalism. Yet, if Goliath wants to use the Act to dismiss David's lawsuit, he can and will.

- - -

* Don't think that the "commercial speech" clause in HR 4364 would help remove the case from the Anti-SLAPP law. As a defendant in one of my cases argued, and as MagicJack would argue:

There is no authority for [plaintiff's] allegation at paragraph 81 of his complaint that “The defendants’ motives in writing and propagating the false allegations [...] are economic; therefore, this commercial speech does not qualify for the heightened protections of the First Amendment.” See Compl. ¶ 81. To the contrary, the Supreme Court has squarely rejected it. See Bolger v. Youngs Drug Products Corp., 463 U.S. 60, 67 (1983) (“an economic motivation ... would clearly be insufficient by itself to turn the materials [in question] into commercial speech”); Joseph Burstyn, Inc. v. Wilson, 343 U.S. 495, 501-02 (1952) (“That books, newspapers, and magazines are published and sold for profit does not prevent them from being a form of expression whose liberty is safeguarded by the First Amendment.”); see also New Kids on the Block v. News America Publishing, Inc., 745 F.Supp. 1540, 1544 (C.D.Cal. 1990) (“A profit motive ... is irrelevant to the inquiry of whether the content of ... speech ... is ... commercial [or otherwise]”). In sum, there is no support for [plaintiff's] suggestion that the article is not entitled the fullest protections afforded by the First Amendment.

I don't agree with the above analysis, but that's just my opinion. A judge could just as easily agree with every word.

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At the Fulton County Daily Report:

For $95, plaintiffs lawyers can buy a book that teaches them how to appeal to jurors' basic survival instincts, those that emanate from humans' "Reptilian" brains. ...

But in a DeKalb County wrongful death trial last month, [Plaintiffs lawyer Don] Keenan found that defense lawyers will also buy the book, "Reptile: The 2009 Manual of the Plaintiff's Revolution" -- and use it against him.

Representing a movie theater and a security company accused of not doing enough to prevent a fatal gang shooting in the theater parking lot, W. Winston Briggs and Matthew G. Moffett read from the book and referred to it during closing arguments.

One of their PowerPoint slides read, "Let's see if we can scare them/It could have been anyone killed out there ... because it's a public danger there ... but if you give us $ that will somehow eliminate this danger/They call this their 'reptile' strategy."

The jury rendered a defense verdict.

Here's what I don't understand: how is a book written by the plaintiff's lawyer relevant to the facts of the case?

The Georgia Rules of Evidence provide:

Evidence must relate to the questions being tried by the jury and bear upon them either directly or indirectly. Irrelevant matter should be excluded.

The jury wasn't asked their thoughts and feelings about Mr. Keenan's advocacy methods. They weren't compelled, by force of the state, to leave their work and their families to render a verdict on the Reptile book. They were there because, as the article says, "21-year-old Jesus Silencio was shot to death in the parking lot of the Regal Hollywood 24 movie theater on Interstate 85" and his father, on Mr. Silencio's behalf, brought suit against the theater and its security company.

Reptile has nothing to do with those facts. If the book suggests lawyers do anything inappropriate, that, too, is irrelevant: if a lawyer uses improper advocacy methods at trial, the judge will give corrective instructions to the jury or, if need be, declare a mistrial.

The case was about, and should have remained about, Mr. Sliencio's claims against the theater. Somehow, it became a referendum on Mr. Keenan, and an unfair one at that. Was Mr. Keenan allowed to show the jury how many times the defense lawyers have been threatened with sanctions for spoliating evidence? Could he have copies of all the seminars at the Defense Research Institute that the defense lawyers attended? Was he allowed to introduce evidence establishing how insurance companies — including the Defendants' insurer, the real party at interest — spend millions every year on propaganda to taint juror's perceptions of the civil justice system?

Or were the defense lawyers allowed to cast stones from their glass houses?

* * *

I wrote the above before seeing Mark Bennett's post on the case. Bennett's right that, for lawyers representing clients, "the principle of putting a name on the adversary’s strategy—pulling back the curtain and naming the little man pulling the levers—is a sound one." But that doesn't mean the Court should allow a case about the parties to be transformed into a case about the lawyers.

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Felix Salmon at Reuters caught something interesting:

[T]he facts of the case are pretty clear. The relationship between JP Morgan and Televisa goes back decades, and so JP Morgan was the natural choice for Televisa to turn to when it decided to buy a fiber-optic cable company called Bestel for $325 million, $225 million of which was to come from Televisa subsidiary Cablevisión.

JP Morgan intended to syndicate the loan, but the timing was bad: the deal closed in 2008, when credit markets were all but closed, and as a result JP Morgan ended up owning all of it. After an attempt by Televisa to help JP Morgan syndicate the loan fell through, JP Morgan then turned to Inbursa, Carlos Slim’s bank.

This was not an obvious choice from the point of view of serving one’s client. Slim and Cablevisión compete fiercely in the telecommunications space, where Slim is the dominant monopolist and Cablevisión is selling telephony and internet access in competition with him. And the rivalry is all the tougher due to the history between the two groups: Slim used to be a major shareholder in Televisa, and to this day Inbursa owns a 22% stake in Cablevisión.

Now there were two ways of selling this loan: JP Morgan could either assign it to Inbursa, which would require Cablevisión’s permission, or else it could participate it to Inbursa, which would not. At first, JPM tried to assign the loan, but unsurprisingly Cablevisión refused to grant their permission for that deal to happen.

You can imagine what happened next: JP Morgan dressed up the "assignment" as a "participation." As Judge Rakoff described it in his order,

JP Morgan, acting in bad faith, used the guise of a purported “participation” to effectuate what is in substance a forbidden assignment, with unusual provisions demanded by Inbursa that are calculated to give Inbursa exactly what the assignment veto in the Credit Agreement was designed to prevent. JP Morgan thereby violated, at a minimum, the covenant of good faith and fair dealing automatically implied by law in the Credit Agreement…

Televisa's request for a preliminary injunction halting the agreement was thus granted.

Salmon wonders what JPMorgan's response to all these allegations is:

So for JP Morgan’s side of the story, all I have to go on is their 40-page memorandum of law in the case, which is quite narrowly legalistic, which was roundly rejected by Rakoff, and which obviously can’t respond to Rakoff’s ruling since it was filed before Rakoff made his ruling.

Since JPMorgan moved for summary judgment pursuant to Fed. R. Civ. P. 56, they, like Televisa, were entitled to submit affidavits in support of their position, and it appears they submitted declarations from "Sheldon L. Pollock" and "Jaquelina Truzzell." Both declarations have been unsealed by Judge Rakoff's order, but neither is on the docket.

I doubt the declarations say much; JPMorgan's memorandum of law primarily references the Pollock and Truzzell declarations when discussing side matters, like telephone calls and Televisa's motives for opposing the assignment / participation. Truzzell apparently affirms there are "no side agreements" with Inbursa and that JPMorgan would not release "confidential" information, but that's it. There's nothing about how JPMorgan came to participation terms with Inbursa that, at least on their face, entitle Inbursa to a treasure trove of information about Televisa, far more than provided by JPMorgan's standard participation agreement.

Which I find telling. Though the standard response of most defendants is — for tactical reasons like avoiding getting pinned down to a particular version of events — to "deny and delay" rather than to come forth with an affirmative opposition, under the facts here, JPMorgan really needed to make a better showing. Here's the full quote (excerpted above) from Judge Rakoff's order:

In opposing a preliminary injunction, JPMorgan argues that the Participation Agreement is technically consistent with the Credit Agreement. Superficially, this may be correct. For example, with respect to Cablevisión’s concerns about confidential information, the Credit Agreement permits disclosure of information about the borrower, not just to assignees (who can be vetoed) but also to participants (who cannot), provided that such information is given on a confidential basis. Credit Agreement § 9.16(f)(i). This includes “all information received from the Borrower . . . relating to the Borrower, any of its Related Parties or their respective businesses.” Id. § 9.16. Similarly, there is no express restriction in the Credit Agreement on providing a participant with its pro-rata share of fees received by the lender or an option of first refusal for any further transfer of the loan. Finally, under the Credit Agreement, assignment of the loan without borrower consent is expressly permitted when there is an Event of Default. Id. § 9.04(b)(i).

But this narrow focus obscures the gist of Cablevisión’s argument, which is that JPMorgan, acting in bad faith, used the guise of a purported “participation” to effectuate what is in substance a forbidden assignment, with unusual provisions demanded by Inbursa that are calculated to give Inbursa exactly what the assignment veto in the Credit Agreement was designed to prevent. JPMorgan thereby violated, at a minimum, the covenant of good faith and fair dealing automatically implied by law in the Credit Agreement.

The Court agrees.

JPMorgan could have done more factually, rather than just legally, to rebut the appearance of bad faith. But they didn't; they just argued that they were entitled to do what they did, rather than show that their conduct with Inbursa was appropriate.

Such silence could be, in part, an attempt by JPMorgan to protect Inbursa's confidences, which arguably would have been appropriate. (I say "arguably" because the totality of the circumstances here — primarily Inbursa's attempt to negotiate terms more favorable than those typically provided by a participation agreement — imply that Inbursa has waived its right to keep those discussions confidential from Televisa.) But there's nothing on the docket reflecting an attempt to have Judge Rakoff review any pertinent materials in camera, and so there's no reason for us to speculate that JPMorgan's silence was a product of confidentiality.

It thus may be more appropriate to speculate that JPMorgan's silence was the product of not having a good defense. Again: facts win cases. "Technically consistent" legal arguments don't.

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All the signs were there:

[Dr. Rolando G. Arafiles Jr. had] a pattern of improper prescribing and surgical procedures — including a failed skin graft that Dr. Arafiles performed in the emergency room, without surgical privileges. He also sutured a rubber tip to a patient’s crushed finger for protection, an unconventional remedy that was later flagged as inappropriate by the Texas Department of State Health Services. ...

Dr. Arafiles was sending e-mail messages to patients about an herbal supplement he sold on the side. ...

The hospital administrator, Stan Wiley, said in an interview that Dr. Arafiles had been reprimanded on several occasions for improprieties in writing prescriptions and performing surgery and had agreed to make changes. Mr. Wiley, who said it was difficult to recruit physicians to remote West Texas, said he knew when he hired Dr. Arafiles that he had a restriction on his license stemming from his supervision of a weight-loss clinic.

In a surprise inspection last September, state investigators found several violations by Dr. Arafiles ...

Most doctors are competent and diligent professionals who, over the course of their careers, might breach the standard of care in a manner that causes significant harm to patients only a handful of times.

As I have written before, however, "Fact is, there is a small minority of doctors who are simply terrible at their jobs." The nationwide malpractice settlement numbers don't lie:

A few physicians were responsible for a large proportion of malpractice payment dollars paid: The 1 percent of physicians with the largest total payments in the NPDB were responsible for about 11.7 percent of all the money paid for physicians in malpractice judgments or settlements reported to the NPDB. The 5 percent of physicians with the largest total payments in the NPDB were responsible for just under a third (31.4 percent) of the total dollars paid for physicians. Eleven percent (11.6 percent) of physicians with at least one malpractice payment were responsible for half of all malpractice dollars paid from September 1, 1990 through December 31, 2006.

It looks like Dr. Arafiles was among the bottom-of-the-class physicians who shouldn't practice medicine at all.

At least that's what Anne Mitchell, the hospital's compliance officer, and two other nurses (one of them the hospital's quality improvement officer) thought, so they, as Texas law requires them to do, filed an anonymous complaint with the Texas Medical Board.

And what did they get in return for reaching out — through the appropriate, confidential, state-required channels — to protect patients?

They were fired then criminally prosecuted:

When she was fingerprinted and photographed at the jail here last June, it felt as if she had entered a parallel universe, albeit one situated in this barren scrap of West Texas oil patch.

“It was surreal,” said Mrs. Mitchell, 52, the wife of an oil field mechanic and mother of a teenage son. “I said how can this be? You can’t go to prison for doing the right thing.”

But in what may be an unprecedented prosecution, Mrs. Mitchell is scheduled to stand trial in state court on Monday for “misuse of official information,” a third-degree felony in Texas.

I wish I could say I was surprised, but I'm not: Texas is perhaps the most patient-unfriendly state in the union. Just last year, the American College of Emergency Physicians gave Texas an "A" for tort reform and an "F" for access to emergency care. That's no surprise: as tort reform goes up, care goes down. 

Tort reform wasn't enough, though. The doctors in Texas are apparently so bad they need not just special civil protections from patients and their lawyers, but also the threat of criminal prosecution looming over nurses and hospital compliance / quality improvement officers. 

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The Racketeer Influenced and Corrupt Organizations Act ("RICO") is not all that complicated.

Section 1962(c) provides:

It shall be unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise’s affairs through a pattern of racketeering activity or collection of unlawful debt.

In case you think "racketeering activity" is too vague, don't worry — the RICO Act defines it specifically. If the plain meaning rule was applied as strictly as courts say it should be, then we would see these claims prevail in every case involving a systematic fraud.

Instead, over the years defense lawyers and activist courts have imposed a broad swath extra-statutory requirements on RICO claims, such as two separate requirements of "distinctiveness." A plaintiff alleging RICO claims must allege that the "enterprise" at issue is "distinct" from the "persons" in the enterprise, and must allege that the "enterprise" has a "distinct" structure separate from the racketeering.

Of course, if we applied the dual "distinctiveness" requirements the way defense lawyers say we should, then Al Capone and his organization couldn't be prosecuted for racketeering, because Capone's organization was not "distinct" from itself and because Capone and his organization had no structure "distinct" from the racketeering itself.

Thankfully, after a handful of recent Supreme Court cases recognizing the broad language of the RICO Act (e.g., the Cedric Kushner and Boyle cases) , common sense is beginning to prevail again in the federal courts:

In a major setback for several title insurers, a federal judge has refused to dismiss a trio of class action consumer RICO suits that accuse the companies of engaging in a pervasive pattern of overcharging for title insurance by systematically ignoring entitlement to statutory discounts.

Although title insurers have been battling a wave of consumer litigation in recent years, the three decisions by U.S. District Judge Joel H. Slomsky mark the first time that a court has green-lighted RICO claims.

Defense lawyers had urged Slomsky to dismiss the RICO claims, arguing that the plaintiffs failed to plead a proper RICO enterprise since an insurer and its agents cannot be considered legally "distinct."

Slomsky disagreed, saying "plaintiffs have satisfied the minimum 'person' and 'enterprise' distinctiveness requirement because the combination of Commonwealth Land and the title agents constitute a single 'enterprise' separate and distinct from the 'person' of defendant Commonwealth Land and this combination is permissible under RICO jurisprudence."

The opinion is a victory for common sense. Will the plaintiffs prevail? Beats me. But a plaintiff who can marshal plausible allegations of systematic mail and wire fraud should not have the courthouse doors closed to them on grounds of sophistry.

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Zubulake v. UBS Warburg LLC, 220 F.R.D. 212, 217 (S.D.N.Y. 2003) is, as I wrote before, the Tale of Genji for electronic discovery. It is as widely-cited as all but the most prominent of Supreme Court opinions.

Gregory P. Joseph brings us selections from Judge Scheindlin’s new magnum opus on the subject, Pension Comm. of Univ. of Montreal, 2010 U.S. Dist. LEXIS 4546 (S.D.N.Y. Jan. 15, 2010):

In an era where vast amounts of electronic information is available for review, discovery in certain cases has become increasingly complex and expensive. Courts cannot and do not expect that any party can meet a standard of perfection. Nonetheless, the courts have a right to expect that litigants and counsel will take the necessary steps to ensure that relevant records are preserved when litigation is reasonably anticipated, and that such records are collected, reviewed, and produced to the opposing party. As discussed six years ago in the Zubulake opinions, when this does not happen, the integrity of the judicial process is harmed and the courts are required to fashion a remedy. Once again, I have been compelled to closely review the discovery efforts of parties in a litigation, and once again have found that those efforts were flawed. As famously noted, "[t]hose who cannot remember the past are condemned to repeat it." By now, it should be abundantly clear that the duty to preserve means what it says and that a failure to preserve records — paper or electronic — and to search in the right places for those records, will inevitably result in the spoliation of evidence.

The Court granted sanctions in the form of an adverse inference / spolitation instruction and monetary compensation to opposing counsel.

Going forward, courts will no longer accept excuses when corporations allow relevant evidence to be destroyed by failing to implement adequate controls:

After a discovery duty is well established, the failure to adhere to contemporary standards can be considered gross negligence. Thus, after the final relevant Zubulake opinion in July, 2004, the following failures support a finding of gross negligence, when the duty to preserve has attached:

• to issue a written litigation hold;
• to identify all of the key players and to ensure that their electronic and paper records are preserved;
• to cease the deletion of email or to preserve the records of former employees that are in a party's possession, custody, or control; and
• to preserve backup tapes when they are the sole source of relevant information or when they relate to key players, if the relevant information maintained by those players is not obtainable from readily accessible sources.

(Emphasis and formatting added).

Consider yourselves warned.

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I was going to write about how the Securities Industry and Financial Markets Association (SIFMA) had hired Carter Phillips of Sidley Austin — perhaps the most experienced Supreme Court advocate in the country — to "study" the constitutionality of President Obama's proposed tax on the big banks, which is really just code for "SIFMA hired Phillips to create grounds for a 5-4 Supreme Court decision invalidating the tax."

Then something funny happened.

When I typed "Carter Phillips" into Google News to find an article about the SIFMA representation, I saw another story posted around the same time, "Joe Arpaio's Lawyer for Records Dispute Costing Taxpayers $990 -- Per Hour."

The $990 per hour lawyer for Sheriff Joe Arpaio is, indeed, Carter Phillips.

For those of you who don't know about Sheriff Joe Arpaio, here's an introduction:

A federal grand jury is investigating Joe Arpaio, the Arizona sheriff known for his aggressive stance on illegal immigration, for possible abuses of power in launching investigations of local officials who disagree with him, authorities said Friday.

Two Maricopa County officials have been subpoenaed to appear before the grand jury to testify about Arpaio's actions against county officials since they moved to cut his budget in late 2008.

Since then Arpaio and County Atty. Andrew Thomas, an ally, have filed criminal charges against two county supervisors, have said dozens of other county workers are under investigation and have filed a federal racketeering lawsuit accusing the entire county political structure of conspiring against them.

A walk through the "Joe Arpaio" tag at the Phoenix New Times will appall you for hours.

The United States Constitution rightly ensures criminal defendants the right to assistance of counsel. Common law in all fifty states rightly holds the attorney-client relationship to be as sacred and protected as any other. And we all have bills to pay, even Jay Leno, even top-drawer Supreme Court lawyers.

I'd understand if Phillips was part of Arpaio's criminal defense team. But he's not: Phillips represents Arpaio in a vindictive attempt to dig into Maricopa County judges' and administrators' emails following their investigation into his abuses. There's no right to that.

We can't judge a lawyer by their clients — consider public defenders, the unsung guardians of liberty — but a lawyer is only as good as the causes he or she represents.

No matter how effective Carter Phillips is as an advocate or counselor, he'll never be a great lawyer.

Not while doing Joe Arpaio's dirty work.

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Fred Wilson links to his partner Brad Burnham's post, "We need an independent invention defense to minimize the damage of aggressive patent trolls:"

I know of no case where the engineers in one of our companies were aware of the patents that are now being used to attack them. The moral rightness of this screams at me. If, as an engineer focused on solving a problem, I happened to come up with an idea that is in some way similar to yours, then that in itself should suggest that it was obvious and not patentable. Unfortunately, that does not really help. There, the burden of proof is still on the startup and it is still smarter to settle than to burn precious capital on a defense.

If, on the other hand, the troll was required to show the startup had some prior knowledge of their technology, the burden would be shifted to the attacker, and this blatant abuse would come to a grinding halt. If you believe as I do that innovation is key to social progress, please support patent reform. It is a complicated issue, but an independent invention defense is an obvious place to start.

(Emphasis mine; keep reading to see why.)

Though I sympathize with Brad's concerns — patent infringement litigation is both high stakes and notoriously expensive, and thus risky and burdensome even for defendants likely to prevail at trial — I have a couple issues with an independent invention defense. 

First, the defense already exists to some extent in the form of differing damages for "infringement" compared to "willful infringement." If the plaintiff cannot prove at least "objective recklessness" — which is quite hard to do in the wake of In Re Seagate Technology, since the defendant has no affirmative duty to avoid infringement — then the plaintiff cannot recover treble damages or attorneys' fees. The stakes are thus lower in genuine "independent invention" cases.

Second, an independent invention defense would discourage individuals and businesses from doing an adequate patent search before investing resources into novel solutions. One of the primary reasons we have a public patenting process (rather than merely protection of private trade secrets) is to make inventions easily available to the public for use. How many times would the wheel have been reinvented if it had been kept secret? Though frustrating to businesses, from a societal standpoint patent licensing is generally preferable to the redundant investment of time, effort and money into solving problems with known solutions.

Third, an independent invention defense would be ripe for abuse. Independent invention is already a defense to to a willful patent infringement claim; making independent innovation a complete defense would give defendants an even greater incentive to manufacture "evidence" showing their "independent" invention. Worse, genuine invention is often quite messy; the independent invention defense could thus perversely protect only those defendants who from the start knew to create a trail of "evidence."

That's not to say we don't have problems with our patent system. We do. I just don't think an independent invention defense is the way to go.

So let's talk about the part of Brad's post I emphasized: obviousness and the burden of proof.

A recurring theme in the comments to Brad's post and Fred's post is the complaint that many patented "inventions," particularly in the Silicon Valley industries, are not particularly inventive. Patent law is supposed to guard against this problem. Indeed, the most common defense in patent suits is a counterclaim by the defendant that the patent is invalid because it is too obvious.

35 U.S.C. § 103 forbids patents where "the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains." The Supreme Court has explained the analysis as such:

Under § 103, the scope and content of the prior art are to be determined; differences between the prior art and the claims at issue are to be ascertained; and the level of ordinary skill in the pertinent art resolved. Against this background the obviousness or nonobviousness of the subject matter is determined. Such secondary considerations as commercial success, long felt but unsolved needs, failure of others, etc., might be utilized to give light to the circumstances surrounding the origin of the subject matter sought to be patented.

More pertinent here is how a finding of "obviousness" is the only tool courts have to mitigate the high stakes and high expense of patent infringement cases with questionable, but not outright dubious, merit.

Finding "obviousness" as a matter of law is a nuclear option; it requires the court dismiss the case, simultaneously creating precedent barring the defendant from any future litigation on the patent in the future and creating a basis for any current licensees to stop payment to the defendant. Courts' hesitation to use that nuclear option — particularly given the standards governing summary judgment and courts' unfamiliarity with the state of innovation in highly technical industries — is understandable.

So what to do?

Change the burdens.

It's not a new idea; employment-discrimination cases routinely apply the McDonnell-Douglas burden-shifting framework at summary judgment.

Right now, in terms of "obviousness," a court has two options:

1. Find the patent "obvious" as a matter of law, thereby blowing up the case and invalidating the patent;
2. Leave "obviousness" up to the jury, where the defendant has the burden of proving the patent is "obvious."

As Brad complains, #2 may be a hollow remedy.

So why not add another option? Why not allow the court to put the burden of nonobviousness upon the plaintiff if the defendant shows, pre-trial, a "cogent and compelling" argument that the patent was obvious? ("Congent and compelling" isn't foreign to courts either; such a showing is required in securities fraud cases under Tellabs.)

A court could further mitigate the pre-trial risk to the defendant by ordering bifurcation of the trial; i.e., first there's a trial on "obviousness," and then, if the patent is "nonobvious," there's a trial on infringement. Adding some element of fee-shifting — e.g., a plaintiff who loses the "obviousness" trial has to pay the trial fees of the defendant — would create a market for contingent fee defense of patent infringement suits, and thereby mitigate the "burn[ing] of precious capital ..."

Just a thought.

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Last spring, in How To Write Your Brief So That The Judge Will Hate You, I profiled a sarcastic and dismissive brief — filed by attorneys for West Publishing no less, in a case against a law professor — and concluded:

An opening brief filled with sarcasm will perturb a judge doing his or her best to reserve judgment until they've heard both sides just as much as an opening statement filled with indignity will repulse a jury doing their best to be fair and impartial until they've heard all of the evidence.

As Bruce Merenstein posted on The Legal Intelligencer Blog yesterday:

... I was curious when I read numerous reports not long ago of a brief filed by Sidley Austin lawyers in a case in Illinois state court involving claims of innocence by convicted murderer Anthony McKinney. Working on McKinney's behalf are students at Northwestern University's Medill Innocence Project. State prosecutors served subpoenas on the students, seeking to obtain, among other things, video footage of a witness statement and the students' notes. Sidley Austin filed a motion to quash the subpoenas on behalf of the students. Following the state's response to the motion, Sidley submitted a reply brief. It was this reply brief that received so much attention.

... The judge then referred to the brief as "reprehensible," an "editorial" not fit for court, and "dripping with sarcasm." She also compared the brief unfavorably to one she had received earlier that day from a pro se prisoner.

Merenstein didn't think much was wrong with the brief:

My primary conclusion after reading the brief a number of times is that the Sidley brief is well-written, to the point, devoid of irrelevant ad hominem attacks and quite persuasive. While I've seen sarcasm in many briefs (and cringed every time I read it), I looked high and low through the Sidley Austin brief and was unable to find anything remotely sarcastic in the brief. I'm also at a loss as to what is "reprehensible" about it.

I agree that the brief wasn't "reprehensible," but it certainly wasn't a model of courteous advocacy.

 Let's start with the first sentence:

The State's response brief evinces a surprising lack of comprehension of the requirements of the Illinois Reporter's Privilege Act (the ''Act'') and an equally surprising lack of affinity for the important First Amendment νalues that underlie the Act and the role of investigative reporting in promoting those values.

(Emphasis added.) Was it really necessary to accuse the flesh and blood representative of the State of Illinois of being too stupid to understand the state's laws? To accuse them of disliking free speech?

The Sidley Austin lawyers could have just as easily written:

The State's argument, if accepted by this Court, would void the requirements of the Illinois Reporter's Privilege Act (the ''Act'') and would undermine important First Amendment νalues that underlie the Act and the role of investigative reporting in promoting those values.

Same ideas, but without insulting opposing counsel's ability to "comprehend" the law.

Elsewhere in the brief, "The State must not understand the respective roles of government and the media in our society." The remark was simply gratuitous; it did nothing to enhance the argument that followed:

When the State discharges its prosecutorial powers, it does have strict disclosure obligations rooted in fundamental concepts of due process. Respondents have no such obligations. And while the maxim that ουr judicial system is entitled to "everyman's evidence" has currency, ουr society has also long recognized that the fundamental role newsgathering provides in our society places special restrictions on access to unpublished newsgathering materials. "The reporter's privilege has evolved from a common law recognition that the compelled disclosure of a reporter's sources could compromise the news media's first amendment right to freely gather and disseminate
information." In re Special Grand Jury Investigation, 104 Ill. 2d 419, 424 (1984).

A perfectly persuasive and cogent analysis marred by a gratuitous insult. Tisk, tisk.

We've all been there. We've all read briefs and heard oral arguments that were (at least to us) irrelevant, unfounded, or directly contradicted by controlling precedent or the plain meaning of the statute. The Innocence Project's attorneys had every reason to be infuriated by the State's subpoena: there's no question the State demonstrated a surprising amount of contempt for Illinois' Shield Law and for the fundamental free speech values embodied by that law.

But a brief is no place to question the intellect or motives of opposing counsel. Get mad, then get over it.

As James Fallows puts it: Always write angry letters to your enemies. Never mail them.

Always draft angry briefs. Never file them.

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JURIST Paper Chase reports:

US security firm Blackwater [JURIST news archive] on Wednesday reached a settlement agreement in seven federal lawsuits filed by Iraqi citizens. The suits claimed that Blackwater, now known as Xe, created a reckless culture [AP report] that resulted in numerous deaths, including the deaths of 17 Iraqi civilians [JURIST reports] in September 2007 and the 2006 killing of an Iraqi guard. The suits accused Blackwater founder Erik Prince of personal responsibility. The terms of the settlement have not been made public, but Xe said in a statement that it is "pleased" with the resolution.

The settlement comes just a week after after a US judge dismissed charges [JURIST reoprt] against five guards indicted for their involvement in the September 2007 killings. Judge Richardo Urbina of the US District Court for the District of Columbia [official website] dismissed [opinion, PDF] voluntary manslaughter and weapons charges against the five guards, finding that statements were obtained in violation of the Constitution.

Susan Burke, who represents the plaintiffs, previously posted her response to Blackwater's motion to dismiss in the case online.

To say the allegations are shocking would be an understatement:

These Complaints allege that Mr. Prince acted contrary to, and in violation of, United
States government policies and instructions. Through their actions, Blackwater seriously harmed the United States and violated the law. See, e.g., Abtan/617 Compl. ¶ 60.

These Complaints allege that Mr. Prince fostered a culture of lawlessness, and encouraged employees to act in the company’s financial interests at the expense of innocent human life. See, e.g., Sa’adoon/615 Compl. ¶¶ 16, 18, 25-29; Albazzazz/616 Compl. ¶¶ 13, 14; Abtan/617 Compl. ¶¶ 2, 3, 49-57; Hassoon/618 Compl. ¶¶ 31-35, 46, 47, 80-85; Rabea/645 Compl. ¶¶ 1, 13-21. Collectively, these Complaints describe with specificity multiple examples of Mr. Prince’s men killing and wounding innocent Iraqis. For example, the Hassoon/618 Complaint describes a killing as follows: “On July 1, 2007, a driver named Wala’a was driving a minibus for three related families who were going to Baghdad airport to apply for passports. The three families included parents with four children, including a three-month old baby; an uncle; and a cousin and his wife. As the families were returning from the airport, six Xe-Blackwater vehicles, including three with turrets, surrounded the minivan and opened fire for absolutely no reason. The Xe-Blackwater shooters killed the nine-year boy. The Xe-Blackwater shooters shot the mother in the back as she bent over, trying to protect the three-month old daughter from being shot. She was unsuccessful, as the baby was shot in the face. The Xe-Blackwater shooters hit the father and the uncle. They shot at, but missed, the two other children. The Xe-Blackwater shooters also hit the cousin, Sadiq Ahmed Ali. They shot at but missed his wife, Khalida Jasim Mohammed, and the driver. Hassoon/618 Compl. ¶¶ 50-56. The other Complaints are to like effect, spelling out in detail the dates and times of the killings. For example, the Abtan/617 Complaint describes the Nisur Square shootings: “On September 16, 2007, heavily-armed Blackwater mercenaries (known in Blackwater parlance as “shooters”) working in Iraq began firing on a crowd of innocent civilians without justification, resulting in multiple deaths and injuries.” Abtan/617 Compl. ¶ 2. The acts against each Plaintiff are detailed. See, e.g., Abtan/617 Compl. ¶ 17 (stating “Plaintiff Haider Ahmed Rabe’a is a 32-year old Baghdad resident who was seriously injured by Xe-Blackwater shooters when they shot him in both legs as he was trying to flee from his car to escape the gunfire.”) Abtan/617 Compl. ¶ 17

...

As testified to under penalty of perjury by John Doe No. 2, Mr. Prince views himself as a Christian crusader tasked with eliminating Muslims and the Islamic faith from the globe. Decl. John Doe No. 2 ¶ 9. Mr. Prince intentionally deployed to Iraq certain men who shared his vision of Christian supremacy, and encouraged them to kill Iraqis. Decl. John Doe No. 2 ¶¶ 10-11. In addition to his Christian supremacist views, Mr. Prince was also motivated by greed. He knowingly deployed unsuitable candidates for carrying lethal weaponry because deployments meant more money. Decl. John Doe No. 2 ¶ 12. Mr. Prince ignored the advice and pleas from certain employees, who sought to stop the deployments and resulting killings of innocent Iraqis. Decl. John Doe No. 2 ¶ 13. See also Decl. John Doe No. 1 which describes additional deaths; and Exhibit C, in which one of Mr. Prince’s men admits to killing innocent Iraqis.

Plaintiffs brought suit under three statutes: Racketeer Influenced and Corrupt Organizations Act (“RICO”), Alien Tort Statute ("ATS"), and War Crimes Act ("WCA"). Blackwater's motion to dismiss was still pending when the case was settled.

Dismiss? How could someone get away with shooting a baby in the face?

Judicial politics. It doesn't matter if Congress passed at least three separate acts (RICO, ATS, WCA) making organized murder abroad illegal. It doesn't matter if two successive Presidents — one Republican, one Democratic — refused to grant private contractors immunity.

All a private contractor needs is a conservative judicial activist and even a dozen Iraqis who "were beaten, electrocuted, raped, subjected to attacks by dogs, and otherwise abused by private contractors" will have their case dismissed, like in Saleh / Ibrahim v. Titan Corporation et al.

Ironically, the dismissal of the criminal case probably encouraged Blackwater to settle. Plaintiffs' lawyers normally welcome simultaneous criminal prosecution of the defendants (for a host of reasons), and I imagine Burke did, too. Here, however, in light of the extraordinary circumstances, Blackwater may have felt the dismissal of the criminal charges offered them an opportunity to wrap everything up and retreat back into the shadows.

Where they can get back to business as usual.

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There's a myth — promoted by vested interests — that the United States is a free market economy.

Don't believe it. Even in the smallest of transactions, monopoly power still rules, dutifully skimming its unearned share.

"How Visa, Using Card Fees, Dominates a Market":

Competition, of course, usually forces prices lower. But for payment networks like Visa and MasterCard, competition in the card business is more about winning over banks that actually issue the cards than consumers who use them. Visa and MasterCard set the fees that merchants must pay the cardholder’s bank. And higher fees mean higher profits for banks, even if it means that merchants shift the cost to consumers.

Seizing on this odd twist, Visa enticed banks to embrace signature debit — the higher-priced method of handling debit cards — and turned over the fees to banks as an incentive to issue more Visa cards. At least initially, MasterCard and other rivals promoted PIN debit instead.

As debit cards became the preferred plastic in American wallets, Visa has turned its attention to PIN debit too and increased its market share even more. And it has succeeded — not by lowering the fees that merchants pay, but often by pushing them up, making its bank customers happier.

In an effort to catch up, MasterCard and other rivals eventually raised fees on debit cards too, sometimes higher than Visa, to try to woo bank customers back.

“What we witnessed was truly a perverse form of competition,” said Ronald Congemi, the former chief executive of Star Systems, one of the regional PIN-based networks that has struggled to compete with Visa. “They competed on the basis of raising prices. What other industry do you know that gets away with that?” 

As an old friend of mine wrote,

The present conditions of business cannot be accepted as satisfactory. There are too many who do not prosper enough, and of the few who prosper greatly there are certainly some whose prosperity does not mean well for the country. ... [W]e heartily approve the prosperity, no matter how great, of any man, if it comes as an incident to rendering service to the community; but we wish to shape conditions so that a greater number of the small men who are decent, industrious and energetic shall be able to succeed, and so that the big man who is dishonest shall not be allowed to succeed at all. ...

Wherever in any business the prosperity of the business man is obtained by lowering the wages of his workmen and charging an excessive price to the consumers we wish to interfere and stop such practices. We will not submit to that kind of prosperity any more than we will submit to prosperity obtained by swindling investors or getting unfair advantages over business rivals. ...

It is utterly hopeless to attempt to control the trusts merely by Antitrust Law, or by any law the same in principle, no matter what the modifications may be in detail. In the first place, these great corporations cannot possibly be controlled merely by a succession of lawsuits. The administrative branch of the Government must exercise such control.

Theodore Roosevelt said those words ninety-eight years ago. He was right then and is right today.

But these are different times; we can't rely on the administrative branch of the Government to exercise control, even when it claims it will. 

The process had only just started in Teddy Roosevelt's day:

The first federal regulatory agency, the Interstate Commerce Commission, was set up to regulate railroad freight rates in the 1880s. Soon thereafter, Richard Olney, a prominent railroad lawyer, came to Washington to serve as Grover Cleveland's attorney general. Olney's former boss asked him if he would help kill off the hated ICC. Olney's reply, handed down at the very dawn of Big Government, should be regarded as an urtext of the regulatory state:

"The Commission . . . is, or can be made, of great use to the railroads. It satisfies the popular clamor for a government supervision of the railroads, at the same time that that supervision is almost entirely nominal. Further, the older such a commission gets to be, the more inclined it will be found to take the business and railroad view of things. . . . The part of wisdom is not to destroy the Commission, but to utilize it."

Today, regulatory capture infects — literally infects — every aspect of our lives.

"Safety of Beef Processing Method Is Questioned":

 Officials at the United States Department of Agriculture endorsed the company’s ammonia treatment, and have said it destroys E. coli “to an undetectable level.” They decided it was so effective that in 2007, when the department began routine testing of meat used in hamburger sold to the general public, they exempted Beef Products.

With the U.S.D.A.’s stamp of approval, the company’s processed beef has become a mainstay in America’s hamburgers. McDonald’s, Burger King and other fast-food giants use it as a component in ground beef, as do grocery chains. The federal school lunch program used an estimated 5.5 million pounds of the processed beef last year alone.

But government and industry records obtained by The New York Times show that in testing for the school lunch program, E. coli and salmonella pathogens have been found dozens of times in Beef Products meat, challenging claims by the company and the U.S.D.A. about the effectiveness of the treatment. Since 2005, E. coli has been found 3 times and salmonella 48 times, including back-to-back incidents in August in which two 27,000-pound batches were found to be contaminated. The meat was caught before reaching lunch-rooms trays.

The last election has changed matters somewhat, including in terms of Antitrust. But make no mistake: the administrative branch of the Government is loathe to exercise control over the great corporations, and will just as often empower the great corporations against competitors and consumers as it will restrain them.

Thus, the primary method we have to control great corporations — whether to ensure a level playing field for competition or to protect ourselves from personal or financial injury — is "merely a succession of lawsuits."

Yet, a succession of lawsuits barely works to restrain corporate abuse and malfeasance. Consider Visa/Mastercard, which already paid $2 billion for manipulating merchants' processing fees, yet keep doing it. Jack-in-the-Box was nearly bankrupted by lawsuits following a multi-fatality outbreak of O157:H7 E. coli, yet it's still around, and E. coli still runs rampant in our food, particularly ground beef.

Today, however, we're forgotten what Teddy Roosevelt knew a century ago. Today, many of those same vested interests argue that the feeble option of the "mere succession of lawsuits" is too much. That even the involvement of the owners of corporations in corporate affairs is too much. That corporations are people, too, entitled to "speak" in elections just like you or me.

Don't believe it.

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Via WhiteCoat, I see there's a new line of attack on patients' rights: blame lawyers for making patients sick in the first place. As Time's Wellness blog describes it,

The growing number of Methicillin resistant Staphylococcus aureus (MRSA) infections in hospitals may in part be driven by physicians' tendency to over-prescribe antibiotics to avoid being sued by disgruntled patients, according to a study published this past fall in the American Journal of Therapeutics.

And how did the study reach that conclusion? Here's the abstract of the study, Relationship Between Population Density of Attorneys and Prevalence of Methicillin-Resistant Staphylococcus aureus: Is Medical-Legal Pressure on Physicians a Driving Force Behind the Development of Antibiotic Resistance?:

We performed a hypothesis-generating study evaluating the perceived threat of lawsuits among physicians and methicillin resistance in Staphylococcus aureus. We found a correlation between the prevalence of methicillin resistance among clinical S. aureus isolates and both antibiotic prescriptions per capita and density of attorneys in countries in Europe and North America. We did not find a correlation between prevalence of methicillin resistance and physician density. Further investigation is warranted to study whether physicians' perceived fear of lawsuits, of which attorney density may be a crude surrogate marker, results in antibiotic prescription practices that contribute to the emergence of antimicrobial resistance among virulent pathogens such as S. aureus, with global implications on the ethics of the delivery of quality health care to all members of society.

Although there can be merit to a preliminary investigation of data, a "hypothesis-generating study" is, by definition, unscientific. The scientific method requires the investigator form the hypothesis before performing the experiment.

There's good reason for that; e.g., following the method helps guard against bias, which can cause investigators to draw spurious relationships from data.

Like the spurious relationship claimed between the "density of lawyers" in a given area and MRSA.

Despite the headline-grabbing conclusion in the abstract, Drs. Sakoulas, Wormser, Visintainer, Aronow, and Nadelman didn't actually find much evidence with which to blame lawyers for MRSA. As the study — which you have to pay to read, and thus the vast majority of people can't or won't read —  says:

Using the nonparametric test for trend, we noted a trend of increased lawyers per capita in states with higher percentages of MRSA, but this did not achieve statistical significance (P = 0.215). When analyzed in 2 groups, states with a prevalence of .40% MRSA in ICUs tended to have more attorneys per capita than those with a prevalence of ,40% MRSA (mean 347 vs. 288 per 100,000; mean rank 23.4 vs. 16.5; P = 0.08). The difference in physician density was less significant (300 vs. 257 per 100,000; mean rank 22.1 vs. 19.0; P = 0.42).

That is to say, the authors found no relationship between lawyers per capita and MRSA.

Instead, the authors found a relationship between lawyers per capita and MRSA after they narrowed the definition of "MRSA" to mean an abnormally high prevalence of MRSA in ICUs.

Does that mean that more lawyers in a given area causes an abnormally high prevalence of MRSA in ICUs?

No.

As every good scientist knows, correlation does not imply causation. This logical fallacy is so common, and so thoroughly disproven, that it has its own fancy Latin name: cum hoc ergo propter hoc.

The authors know that. As the study — that is, the part not available to the public — admits:

This study has a number of limitations, and therefore, its conclusions must be interpreted with caution. ... The relationships that emerged should only be considered as crude, not causal, associations because practice behavior was not assessed at the individual level and adjustment for confounders or other covariates was not conducted.

So let's recap what the "study" did:

1. Disregarded the scientific method; then,
2. Played around with data in the hopes of finding a link between lawyers and antibiotic-resistant bacteria; then,
3. Failed to find such a link; then,
4. Admittedly cherry-picked data until they could claim a weak correlation; then,
5. Admittedly made numerous assumptions about the link between "density of lawyers" and physicians' behavior; and finally,
6. Admittedly did not evaluate any other variables that could explain the correlation.

Nobel-worthy this is not.

But that's not what bugs me about the "study."

What bugs me is how supposedly objective researchers don't even try to conceal their motives anymore:

George Sakoulas, M.D., assistant professor of medicine and lead author of the study, concluded, "The findings suggest that more research is needed to evaluate the potential impact of medical liability concerns on the medical care system. The study findings hint toward the importance of medical tort reform as a way to reduce healthcare costs and improve quality. Another way might be to foster more judicious prescription of antibiotics based on science and evidence rather than on risk aversion."

Remember: Dr. Sakoulas didn't have any "findings [that] hint toward the importance of medical tort reform as a way to reduce healthcare costs and improve quality." He cherry-picked data until he found a weak correlation between lawyers per capita and an abnormally high prevalence of MRSA in intensive care units, a correlation he admitted could be entirely meaningless since he chose not to investigate other possible explanations.

That, however, is enough for him to jump right to "the importance of medical tort reform as a way to reduce healthcare costs and improve quality."

Sure.

Worse, we already know there's a better explanation for the weak correlation between lawyers and MRSA, an explanation that requires far fewer leaps in logic.

There's another fancy Latin phrase scientists use when faced with competing explanations: entia non sunt multiplicanda praeter necessitatem. The principle is better known as Occam's razor: 

Occam's razor states that the explanation of any phenomenon should make as few assumptions as possible, eliminating those that make no difference in the observable predictions of the explanatory hypothesis or theory. The principle is often expressed in Latin as the lex parsimoniae (translating to the law of parsimony, law of economy or law of succinctness). When competing hypotheses are equal in other respects, the principle recommends selection of the hypothesis that introduces the fewest assumptions and postulates the fewest entities while still sufficiently answering the question.

When faced with data suggesting a correlation between the "density of lawyers" and a high prevalence of MRSA in ICUs, there are at least two possible explanations:

1. The "density of lawyers" in a given area —  including lawyers who work for hospitals, lawyers who have devoted their careers to defending doctors, and lawyers who have never touched a medical malpractice file — specifically makes physicians more concerned about malpractice liability than they otherwise were, leading them to over-prescribe antibiotics; or,
2. The "density of lawyers" and a high prevalence of MRSA in ICUs are both determined by one or more common factors.

The first explanation — the one adopted by Dr. Sakoulas — requires making a lot of assumptions, such as (a) doctors know how "dense" their area is for lawyers; (b) that the "density" of lawyers really is "a crude surrogate marker" for the fear of a lawsuit, even though the authors themselves admit "there was no significant relationship between attorney density and number of paid malpractice claims per 1000 physicians at the state level;" and, (c) concern about malpractice liability specifically increases the likelihood that a physician will prescribe one of the antibiotics tied to increase MRSA development, over and above the numerous other factors that encourage the physician to prescribe the antibiotic.

That's an awful lot of assumptions.

The second explanation requires making a single assumption: that there is at least one factor that can lead to both a higher density of lawyers and a higher prevalence of MRSA in a given area.

One such factor comes to mind: the degree of urbanization.

MRSA is primarily an urban disease: it was first diagnosed in large, urban hospitals, thereafter spread faster in urban areas, and today is more prevalent in urban areas than in rural areas. The more urbanized an area is, the more prevalent MRSA will be.

Lawyers, too, are an urban phenomenon: the states with the highest "density" of lawyers (D.C., New York, Delaware, Massachusetts) are also the most urbanized, while the states with the lowest "density" of lawyers (North Dakota, Arkansas, South Dakota, Kansas, Idaho) are the least urbanized. The more urbanized an area is, the more lawyers it will likely have.

An increase in lawyers doesn't cause an increase in MRSA; urbanization causes both. Quod erat demonstrandum.

I don't doubt the authors — who included an infectious disease specialist and an epidemiologist — knew the relationship between a high prevalence of MRSA and urbanization. I also don't doubt the authors suspected the relationship between lawyer density and urbanization.

They just didn't want to let science get in the way of politics.

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That's one way to lose millions of dollars:

Disbarred lawyer Kenneth Heller's refusal to turn over files in a matter that ultimately was resolved with a $3.7 million settlement was "symptomatic" of a 24-year record of "utter contempt for the judicial system," Southern District Bankruptcy Judge Stuart M. Bernstein wrote, quoting from an opinion of the appeals court in Manhattan that disbarred Heller in 2004.

Bernstein's ruling in In re Ruby G. Emanuel, 97-44969, denied Heller any share in the $1.2 million the judge had awarded to the law firm of Jacoby & Meyers, which took over from Heller the wrongful death case of James Emanuel, a stevedore who was fatally injured in a 1992 accident at the Brooklyn Navy Yard.

...

Following Heller's disbarment [for misconduct in an unrelated case], Ms. Emanuel retained Jacoby & Meyers to handle the retrial in state court.

The law firm asked Heller to forward his files in the matter, but Heller refused, even though, Judge Bernstein noted, "terminated lawyers normally send their files promptly to new counsel to be sure that the interests of the client are protected."

In resisting the surrender of his files, Bernstein recounted, Heller provided different estimates of the value of his work for Ms. Emanuel.

During Jacoby & Meyers' 2 1/2 year quest to secure the files, Heller offered various explanations as to what had happened to them -- lost in a house upstate, damaged by a flood, discarded by workers -- as the case was passed among five judges in Manhattan and the Bronx.

Eventually, the court declared Heller in contempt and issued sanctions, causing Heller to flee, after which deputies raided his office looking for the files, to no avail.

$3.7 million doesn't come close to the actual damages. The decedent was paralyzed from the neck down after a 45-foot fall and spent 20 months in the hospital before he died. In the original trial (in which Heller represented the plaintiff), a jury unsurprisingly awarded $25 million.

But because Heller didn't turn over the file:

Jacoby & Meyers only had the record on appeal to work with in negotiating a settlement, Michael S. Feldman, the firm's lead attorney on the case, said in an interview.

Heller's files consisted of 43 boxes of material, while the record on appeal filled only two boxes, Feldman said. The defendant's records in the underlying death case had been destroyed in the Sept. 11 attack on the World Trade Center where its law firm, Hill Betts & Nash, had its offices, Feldman added.

"We had to proceed without videos and photographs of Mr. Emanuel" who was paralyzed from the neck down as a result of a 45-foot fall as he was repairing a barge, Feldman said.

Switching attorneys in the middle of contingent fee litigation can cause a dicey situation. It is never easy for the exiting attorney — after pouring years of blood, sweat, tears and money into the case — to set the file down and walk away without securing a fee, as they would before voluntarily referring a case to another attorney.

But walk away they must. An attorney can't dangle the client's case over the new counsel's head as a negotiation tool.

The flip side is that, if the lawyer does the right thing and ensures the timely transfer of representation, the law will protect them. At the resolution of a case, prior contingent fee attorneys are generally entitled to recoup their reasonable costs and the quantum meruit — the fair value — of the work they did.

Except, however, where the attorney has breached their fiduciary duties to the client, in which case most states will deny the award of fees. Indeed, the issue isn't just a concern for contingent fee attorneys: in some states, if a professional breaches their fiduciary duties, the court can order the disgorgement of any fees previously paid.

Some people need to learn lessons the hard way. For the rest of us, take note: there's millions of reasons not to play games with client's files.

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[UPDATE: Welcome, Boing Boing readers! The below post was written before the South Korean edition of W Magazine was spotted out in the wild with Demi Moore's hip re-attached. As you can imagine, one of the most important parts of a retraction demand is that you get your facts straight.]

Lawyers are men and women of letters. Litigators, in particular, pride themselves on their correspondence; ask a litigator to show you their best work, and they will skip over dozens of briefs and transcripts to reveal a letter — maybe a settlement demand, a cease and desist for infringement, a spoliation warning, or a bad faith notice to an insurance carrier — that takes arms against a sea of troubles.

Among defamation lawyers, few letters are important as the first letter they send in a case, the demand for a retraction.

Under New York Times v. Sullivan, in order for the plaintiff in a defamation case to recover punitive damages, they must show "actual malice," i.e. the defendant's actual knowledge of falsity or reckless disregard for the truth. One way to show "actual malice" is to show that the defendant continued to publish the defamatory allegations even after the true facts were made known to them and a retraction was demanded. In some states, like California, a plaintiff must demand a retraction if they want to recover more than the specific monetary damage caused by the defamation.

All of which is to say: retraction demand letters are extraordinarily important in defamation cases. Each retraction demand letter, despite being only a few pages, is the product of hours of painstaking editing.  

Marty Singer is the go-to guy in Hollywood. For everyone in Hollywood.

He's written a few retraction demand letters in his time.

Which makes it hard to understand why he would end a retraction demand letter to a blogger (over the blogger's critique of an apparently photoshopped picture of Demi Moore) with this absurdity:

On behalf of Ms. Moore, we demand publication of an appropriate retraction and apology. We further request that you promptly remove from your website, twitter posts, and other site, all of the false and defamatory statements about my client and the cover photo, as well as any accompanying pictures of the W Magazine cover. We trust that now that the unequivocal facts have been established, that you will comply with these demands in order to set the record straight so that your readers/followers are not misled. If you fail to agree to the foregoing, then you will be exposed to substantial liability, and acting at your own peril.

Please govern yourself accordingly.

This does not constitute a complete οτ exhaustive statement of all of my client's rights or claims. Nothing stated herein is intended as, nor should it be deemed to constitute a waiver or relinquishment, of any of my client's rights or remedies, whether legal οr equitable, all of which are hereby expressly reserved. This letter is a confidential legal communication and is not for publication.

A threatening letter is not "a confidential legal communication" — whatever that means — just because some lawyer says so. Absent a confidentiality order, confidentiality agreement, or some other legal obligation to keep a confidence (e.g., trade secrets shown to an employee), a person has no duty to keep an unsolicited communication from a third party "confidential."

Unless, of course, Marty Singer is reading this post, in which case he should ignore the prior paragraph and consider this post a confidential legal blog post, not for publication.

Bluster — like a bogus "confidentiality" designation — is disturbingly common when powerful lawyers representing clients with essentially unlimited resources threaten unrepresented individuals. Singer's letter, however, is so full of bluster it might fail its essential purpose of establishing liability for punitive damages.

Ordinarily, the demand for a retraction is just that: a demand for an apology and retraction. There's nothing to which the defendant will "agree." Either the potential defendant retracts the publication or they don't.

The text of Singer's letter, however, does not demand a retraction, but instead apparently offers a settlement: "If you fail to agree to the foregoing, then you will be exposed to substantial liability ..." Presumably, then, if the blogger does "agree to the foregoing," then he will not be exposed to substantial liability. Indeed, the possibility of settlement is the only way that the letter could arguably be "confidential," since settlement offers are inadmissible (not the same thing as "confidential," but analogous) in court under Cal. Evid. Code § 1152.

But is that what Singer intended? Is a confidential settlement demand the functional equivalent of a retraction demand? How, exactly, does Singer intend to introduce at trial his own "confidential" letter requesting the defendant "agree" to terms to avoid "substantial liability" as evidence that a retraction was demanded? In other words, how can Singer try to admit the letter as evidence in court when the letter on its face proposes a settlement?

The target of the letter, photographer Anthony Citrano has responded with a retraction demand of his own: 

Mr. Singer: your demand that I retract my statements is a demand that I do further unwarranted and costly damage to a reputation you have already deliberately tarnished. Demanding an apology adds insult to this injury. Obviously, neither of these will be forthcoming.

On the contrary, I demand a complete retraction of all statements made or solicited by you, your client(s), and W that denied this retouching, and served to deliberately impugn my credibility and that of countless others who made similarly fair and accurate observations. I further demand a sincere and prominent public apology.

Touché.

Admissible in court, too.

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Overlawyered passes along a misleading description of the "tort reform" provisions in the Senate health care bill from an anonymous Capitol Hill source:

The “tort reform” section of Senator Reid’s substitute amendment is not merely meaningless, but is actually a significant giveaway to the trial lawyers. It is essentially a 5-year, 50-million dollar grant program to encourage states to develop more plaintiff-friendly alternatives to the current medical liability system.

Section 10607 (p.344 of the Manager’s) establishes a 5-year grant program. The program is administered by the HHS Secretary (Sebelius), in consultation with a review panel. The review panel is structured to ensure that trial lawyers are amply represented, with seats specifically reserved for “patient advocates,” “attorneys with expertise in representing patients,” and “patient safety experts.”

Of course, the unnamed source fails to note that health care companies, defense lawyers and insurance companies are "amply represented," too. Read the bill yourself: alongside the patient advocates on those panels are "Health care providers and health care organizations,” “Attorneys with expertise in representing patients and health care providers,” and “Medical malpractice insurers.”

The source also says:

Nothing about this language requires that the “alternative to litigation” decreases litigation costs.

Nonsense. In order to receive a grant, states have to show how their plan “improves access to liability insurance." After they receive a grant, states' plans will be evaluated by factors such as “the disposition of disputes and claims, including the length of time and estimated costs to all parties” and “the medical liability environment.”

The Pop Tort has a more reasonable view:

Here is some of what we like about it: it proposes to give money to states to consider litigation alternatives, but only programs that are shown to improve patient safety, are voluntary and allow patients to opt, and do not limit a patient’s legal rights.  Clearly, if this passes (the House bill currently has something similar), we will have our battles at the state level as certain well-funded forces try to impose anti-patient measures like “Health Courts.”  But we’ll cross that bridge, as they say….

Whatever is done, we hope it works to reduce errors, but not just in hospitals, (here, here, here, for example) but also those of incompetent individual doctors, who by the way already have more liability protections for their negligence than any other profession in the country. 

Frankly, the biggest problem in the debate over medical malpractice liability in this country is the absence of concrete data. There's no agreement on how much medical malpractice occurs or how much damage it causes, nor any agreement on the effect of health care providers' insurance premiums on access to medical care. There's also only one major study on the reliability of the medical malpractice system, which tort reformers and trial lawyers both read to say whatever they want it to say.

Much like with the Comparative Effectiveness Research proposals, the biggest benefit of these "demonstration programs" will likely not be the discovery of a perfect recipe for the medical malpractice system, but rather the accumulation of data that will inform future debates.

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Oh, Ashcroft v. Iqbal, will we ever stop blogging about you?

The newest online debate pits the class action defense lawyers at Drug & Device Law against University of Pennsylvania Law School Professor Stephen Burbank at PENNumbra, the online supplement to UPenn's Law Review.

Beck and Herrmann open with a defense of Iqbal on several grounds, including:

[C]ourts have no legitimate basis for favoring plaintiffs when interpreting pleading standards. A just system does not pick sides in advance, but instead establishes neutral rules. We reject the normative view that it is somehow “better” to let unmeritorious cases proceed than to risk that meritorious cases will be dismissed. Either way represents error, and neither error is inherently better than the other. Indeed, given the enormous transaction costs that litigation entails, Type II errors (false negatives) are probably preferable to Type I errors (false positives) from a purely economic perspective.

From a "purely economic perspective" it is better if corporations stop wrongfully causing damage in the first place, which they will only do if they have an economic incentive like the threat of legal liability.

But there's a bigger problem with Beck and Herrmann's argument.

It is an "error" when a court dismisses a meritorious case. It is a particularly unjust, unfair, and avoidable "error" when a court dismisses a meritorious case prior to any discovery.

It is not, however, an "error" for a court to refuse to dismiss a case that may be unmeritorious.

Why not? Because the case may be meritorious and, if it is not, the defendant has four more opportunities to resolve the case favorably by testing the merits of plaintiff's claim: judgment on the pleadings, summary judgment, trial, and post-trial relief. That is to say, even after the motion to dismiss, Plaintiff's claims will be assessed, re-assessed, re-re-assessed, then re-re-re-assessed. Then there's an appeal to re-re-re-re-assess each and every element of plaintiff's claims and each and every element of plaintiff's damages.

When a court declines to dismiss an unmeritorious case, there is ample room for error-correction down the road to ensure plaintiff's claims have merit. It's why we have a civil justice system: to provide a thorough airing and evaluation of disputes.

When a court dismisses a meritorious case, however, the only error-correction is a single appeal that will be evaluated under the same unfair anti-plaintiff standard established by Iqbal.

Beck and Herrmann have it exactly backwards: there is "no legitimate basis" for not favoring plaintiffs when interpreting pleading standards. Their "neutral" interpretation of pleading rules is not "neutral" at all, but rather a "normative view" that plaintiffs are not entitled to the same error-correcting procedures to which defendants are entitled.

A "just system" wouldn't pick defendant's side in advance.

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Following up on yesterday's post about "ex parte blogging," i.e. the possibility that the Supreme Court might see a newspaper editorial, article or blog post about a pending case, let's consider the supposed worst-case scenario, in which a Justice sees an editorial, article or blog post which has an effect on their interpretation of the case.

So what?

The Student Note that started the discussion at Balkinzation and Prawfsblog based its analysis on the Kennedy v. Louisiana fiasco, in which a military-justice blogger revealed a significant error in the Supreme Court's opinion, resulting in new briefing and a modification to the opinion.

Kennedy, however, does not show the danger lurking in "ex parte blogging," but rather exactly the opposite: Kennedy shows the danger in relying upon nine people (and their typically fresh-out-of-law-school staff of four clerks each) to set legal policy for the entire country based upon two merits briefs of 15,000 words each and two reply briefs of 7,500 words each. More words are spilled on the Wikipedia page listing the people in line to succeed to the British throne.

The re-hearing and re-writing of the Kennedy opinion was a good thing; we want the Supreme Court's opinions to be based on accurate facts and solid legal reasoning.

We also want those opinions to be as clear as possible; consider Washington v. Davis, the 2006 case in which the Supreme Court laid down an "objective and quite workable" rule that was, quite literally, interpreted differently in every state in the union.

Why wait until the damage has been done — why not invite public comment before the opinions become law?

That's what the other two branches of the federal government do. The United States Congress debates bills for weeks, sometime months, prior to passage, all of which you can see on the Library of Congress' Thomas service, or on the non-profit OpenCongress.org. The Executive Branch similarly posts each and every regulatory change to Regulations.gov for public review and comment prior to promulgating the regulations.

Just how powerful is the public comment process?

Consider epidemiology. As Jennifer Gardy, the co-head of British Columbia Centre for Disease Control explains in this fascinating talk (via), when the SARS coronavirus pandemic began in 2003, it took 19 days just to sequence the virus's genome. This year, after the H1N1/09 influence was declared a pandemic, by the 19th day dozens of virus genomes had been sequenced, the origin and spread of the virus had been established, and a vaccine was already in the works. (Read more from Gardy here; see late-breaking H1N1 research in progress at the Public Library of Science's Currents.)

Indeed, open access / public commenting is how most of academia functions these days. Draft social science and law journal articles are posted on SSRN prior to publication. Draft papers on physics, mathematics, and other complex quantitative papers are posted on arXiv.org.

It's hard to think of any field of government or scholarship today in which work not subject to public scrutiny is considered worthy of use by others; in cryptography, for example, any encryption method which doesn't make its source code available for public scrutiny, like even the government's own encryption standard is available, is presumed worthless.

Individual collegiate evaluation worked for Henry Oldenburg when he was peer-reviewing the Philosophical Transactions of the Royal Society back in 1665. It doesn't work so well when nine Justices are supposed to decide cases of national importance involving hundreds of thousands of pages of briefs, precedent, statutes, regulations, and appellate records at a rate of one opinion issued every four or five days, every word of which will be pondered, analyzed, scrutinized, and, unfortunately, misinterpreted by courts every day.

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Dan Markel is "singularly unimpressed" with the arguments in favor of prohibiting newspapers from editorializing about pending cases before the Supreme Court:

Over on Balkinization, Eugene Fidell has a post expressing sympathy with the idea that newspapers and others should forbear from trying to influence the Supreme Court on the same day that the Court is going to hear oral arguments in a case.  Fidell seems to be persuaded by the gist of this student note in the Stanford Law Review, which raises ethical concerns with "ex parte blogging."

With no disrepect to the competent job in the student Note, I find myself boggled at the suggestion that newspapers or other writers (including legal bloggers) should abjure from weighing in on matters before the Court.

Part of the concern raised by the Balkinization post appears to come from editorials on the day of oral argument:

Times editorial advice to the Supreme Court has, in fact, flowed very freely--increasingly, I believe, on argument days. For example, on October 6, 2009, in Animal Cruelty and Free Speech, the editorial page advised the Court to affirm in United States v. Stevens (No. 08-769), a case that was to be argued that same day. The following day, in The Constitution and the Cross, an editorial gave the Court advice on how to decide a case to be heard that day involving a cross that had been erected on federal land by the Veterans of Foreign Wars. The same thing happened on February 23 and 25 and March 2 and 24, when editorials titled Justice for American Indians, And Unequal Justice for Some, The Right to DNA Evidence, and Corporate Money and Campaigns ran. On January 9, November 4, 12 and 25, and December 10, 2008, editorials on The Court and Voter ID's, The Court and 'Fleeting Expletives,' A Case of Religious Discrimination, Indefinite Detention, and Accountability and the Court all appeared on the day of oral argument.

Sounds like a lot.

I assure you, the Justices don't care.

How do I know? Because the Justices don't care much for what even the parties to the case have to say on the day of oral argument:

Oral arguments are normally conducted during October through April. A 2-week session is held each month with arguments scheduled on Monday through Wednesday of each week. Unless the Court directs otherwise, each side is allowed one-half hour for argument. The Court generally hears argument in 2 cases (hours) each day beginning at 10 a.m. and adjourns after the argument in the second case ends, usually around noon. If more than two cases are to be argued in one day, the Court will reconvene at 1 p.m. to hear the additional arguments.

That's from the Supreme Court's own "Guide for Counsel in Cases to be Argued," which helpfully points out that 30 minutes may in fact be too much:

Your argument time is normally limited to 30 minutes. You need not use all your time. Counsel for the respondent in Whitfield v. United States, 543 U. S. 209 (2005) argued for only 10 of the allotted 30 minutes. Counsel for the respondent in Burgess v. United States, 553 U. S. ––– (2008) argued for only 7 of the allotted 30 minutes. Both respondents prevailed in unanimous decisions of the Court.

"Respondent" in Whitfield and Burgess was the United States government; the "Petitioners" there, both criminal defendants, did not pass Go, did not collect $200, but instead went straight to jail after combined oral argument shorter than a sitcom.

I digress. The bigger problem with the argument raised by the Student Note (Ex Parte Blogging: The Legal Ethics of Supreme Court Advocacy in the Internet Era, 61 Stanford L. Rev. 1535 (2008)) and the Balkinization post is that both miss the forest for the trees: the primary utility of such posts, articles and editorials on the day of oral argument is not to influence the Court but to influence everyone else.

When else — other than the day of oral arguments — are these arguments timely and interesting? When else can the raw power of the Supreme Court and the scope of its reach be highlighted for the hundreds of millions of citizens who have not a clue what the Court is doing this year? Even lawyers don't stay on top of the Supreme Court's docket; most of them learn of pending issues from their newspapers, from these day-of-argument editorials. The same goes for elected representatives.

But we are to ban this practice, one of the few ways we as a society have of keeping aware of what an entire branch of our federal government is doing because maybe, just maybe, 700 words in the newspaper will dislodge the Justices' decades of education, training, experience and ideology?

More on this subject tomorrow.

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Ashby Jones at the Wall Street Journal reports on absolute judicial immunity:

In January, federal prosecutors filed fraud charges against Mark A. Ciavarella and Michael T. Conahan, judges on the Luzerne County, Pa., Court of Common Pleas. Prosecutors alleged that the judges sent numerous juveniles to detention centers over several years in exchange for more than $2.6 million in kickbacks from the former co-owner of two centers.

After the criminal charges, several lawyers filed civil suits seeking monetary damages on behalf of dozens of children and their families against the judges and other defendants. They alleged, among other things, that the judges violated their civil rights.

...

In filings, the judges argued that judicial immunity insulated them from suits. A ruling on the motions is pending. Both judges declined to comment.

Legal experts say the plaintiffs face an uphill battle in piercing the immunity shield. Dating to 1872, the U.S. Supreme Court has repeatedly supported the notion that judges should express their legal convictions without having to worry about personal consequences. In perhaps the most widely cited Supreme Court case on judicial immunity, the court in 1978 rejected a suit filed by a woman against an Indiana judge who had years earlier ordered the woman -- who was then 15 and allegedly mentally impaired -- sterilized without her knowledge.

According to Arthur Hellman, a law professor at the University of Pittsburgh, judicial immunity doesn't protect judges from suits stemming from administrative decisions made while off the bench, like hiring and firing decisions. But immunity generally does extend to all judicial decisions in which the judge has proper jurisdiction, he says, even if a decision is made with "corrupt or malicious intent."

In Mr. Hellman's mind, the rule makes sense. Without it, the courts might be stacked with baseless lawsuits filed against judges. "On one level, it seems outrageous to ban someone from suing a corrupt judge," he says. "But if you allow plaintiffs to pierce the immunity by alleging bad motive, it opens the floodgates."

There is good reason for judicial immunity. Judges, more than any other government officials, determine who wins and who loses in our legal system. They do not pass general laws applicable to everyone like the legislature. They do not enforce the laws in general through multiple levels of supervision, collaboration, and procedures like the executive.

They spend weeks, months and years right in front of citizens with a lot to lose and then tell those citizens to their faces if they win or lose. It is very easy to blame a judge for a citizen's loss in a civil or criminal trial: the judge was the one who made it happen.

We thus cannot have judges hesitating in their good faith decisions about who loses because they fear litigation. The system just will not work; it's the judge's job to determine the loser.

That said, the Luzerne County case is different. We don't need to dive into the bigger questions of when and how immunity should be denied, because it's quite clear it should be denied here, for the two reasons raised by a group of former judges who filed an amicus brief in the case:

Application of immunity to judges who admitted under oath to engaging in a criminal scheme that lasted for years would indeed be "monstrous." [Quoting Judge Learned Hand in Gregorie v. Biddle, 177 F.2d 579 (2d Cir. 1949)] To find immunity would denigrate the respect of the public for the judiciary, which is dependent upon judges making decisions based on the law and the facts, rather than personal, corrupt motives. Moreover, denying Conahan and Ciavarella the privilege ofjudicial immunity in this case would not risk a flood of civil claims against other judges.

...

There is simply no way that Conahan's and Ciavarella's admittedly criminal arrangements with the detention facilities or their predetermination to detain juvenile offenders before any judicial proceeding even existed, can be considered judicial acts. Conahan's and Ciavarella's arguments to the contrary are disingenuous. They necessarily conceded that they acted non-judicially when they admitted to criminal conduct in violation of their judicial oath. Those admissions cannot be reconciled with their present assertion that they acted in a judicial capacity.

Exactly. Wherever it may be that judicial immunity should lie, we know it should not lie where a judge (1) admitted (or were convicted of) corruption or (2) acted wrongfully outside their judicial function.

The "immunity" underlying judicial immunity is — like qualified immunity for executive officials — an "immunity" from being sued. It is a deliberate policy choice to deny some worthy cases even a shot at proving entitlement to relief in exchange for ensuring unworthy cases do not waste judicial time or cause hesitation in the judicial process.

Here, there is no doubt as to the worthiness of plaintiffs' claims: the judges admitted corruption. There is also no doubt that the problem at here was not solely judicial, for there is nothing "judicial" about receiving payments under the table from a private party.

The United States Supreme Court is already considering a related issue, the extent of immunity for prosecutors who fabricate evidence, in Pottawattamie County v. McGhee. They will see this case coming down the pipeline; let's hope they understand the robes cloak only those decisions made for the right reasons.

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One of the positive parts of being involved with The Philadelphia Inquirer's bankruptcy is, though I've had to slog my way through over 1,500 separate filings (most of which are irrelevant to my clients) since The Inquirer filed bankruptcy in February, I've also been privy to extraordinarily exhaustive briefings of what are, on the surface, "simple" issues.

A $300 million question in the bankruptcy is whether the banks that loaned the current owners the money to buy the company back in 2006 can use their existing debt to "bid" on its assets at the auction proposed by management. The question should be answered in the text of the Bankruptcy Code; unsurprisingly, both the banks and management have asserted that the text of the Bankruptcy Code clearly and unambiguously supports their position.

Such a dispute means it's time to pull out the old canons of statutory interpretation.

Judge Robreno's Order yesterday — in which Judge Robreno reversed Judge Raslavich's interpretation of when a debtor may deny secured creditors the ability to "credit bid" in a pre-confirmation auction — provided a remarkably thorough description of the plain meaning rule, which I post below in full so all can cherry-pick for their own cases within our great United States Court of Appeals for the Third Circuit.

(In case you're confused why Judge Robreno of the District Court is acting as an appellate court, note that the District Court initially hears appeals from Bankruptcy Court.)

* * *

It is often said that the polestar for interpreting a statute is to ascertain the intent of Congress. See White v. Lord Abbett & Co. LLC (In re Lord Abbett Mutual Funds Fee Litig.), 553 F.3d 248, 255 (3d Cir. 2009).  “The role of the courts in interpreting a statute is to give effect to Congress's intent.” Alston v. Countrywide Fin. Corp., --- F.3d ---, 2009 WL 3448264, at *4 (3d Cir. Oct. 28, 2009) (quoting United States v. Diallo, 575 F.3d 252, 256 (3d Cir. 2009)). In seeking to ascertain the intent of a statute, a court is bound to follow principles of statutory construction. See In re J.E. Brenneman Co., Inc., 277 F. Supp. 2d 518, 521 (E.D. Pa. 2003) (Yohn, J.) (recognizing that in interpreting the intent of Congress a district court follows established precepts of statutory interpretation).

“Because it is presumed that Congress expresses its intent through the ordinary meaning of its language, every exercise of statutory interpretation begins with an examination of the plain language of the statute.” Alston, --- F.3d ---, 2009 WL 3448264, at *4 (quoting United States v. Diallo, 575 F.3d 252, 256 (3d Cir. 2009) (internal quotation marks and citation omitted)); see also Lamie v. United States Tr., 540 U.S. 526, 534 (2004) (“[W]hen the statute's language is plain, the sole function of the courts . . . is to enforce it according to its terms.”). Thus, the necessary starting point in any attempt to discern congressional intent is the language of the statute itself. United States v. Abbott, 574 F.3d 203, 206 (3d Cir. 2009) (“As in all cases of statutory interpretation, our inquiry begins with the language of the statute and focuses on Congress' intent.”) (citing United States v. Whited, 311 F.3d 259, 263-64 (3d Cir. 2002)); In re Armstrong World Indus., Inc., 432 F.3d 507, 512 (3d Cir. 2005) (citing United States v. Ron Pair Enters., Inc., 489 U.S. 235, 241 (1989)); Idahoan Fresh v. Advantage Produce, Inc., 157 F.3d 197, 202 (3d Cir. 1998).

This plain meaning rule dictates that where the meaning of the relevant statutory language is clear then no further inquiry is required. In re Armstrong, 432 F.3d at 512; Abdul-Akbar v. McKelvie, 239 F.3d 307, 313 (3d Cir. 2001) (en banc) (where the statutory language “admits of no more than one meaning the duty of interpretation does not arise and the rules which are to aid doubtful meanings need no discussion”) (internal quotation and citation omitted); Lancashire Coal Co. v. Sec'y of Labor, Mine Safety and Health Admin. (MSHA), 968 F.2d 388, 391 (3d Cir. 1992) (“[W]hen the statutory language is clear a court need ordinarily look no further.”).

Adherence to the plain meaning rule is not simply a matter of judicial craftsmanship. Faithfulness to the words Congress has used in enacting a statute promotes respect for Congress as the principal source of positive law in a democratic society. See Lamie, 540 U.S. at 536 (“We should prefer the plain meaning since that approach respects the words of Congress.”); Pub. Citizen v. U.S. Dep’t. of Justice, 491 U.S. 440, 470-71 (1989) (Kennedy, J., concurring) (recognizing that departure from the plain meaning rule, except in limited circumstances where completely necessary, would intrude upon the lawmaking powers of Congress). Furthermore, allegiance to the plain meaning rule also disciplines courts to avoid making policy choices where the intent of Congress is expressed in the language of the statute. Pub. Citizen, 491 U.S. at 471 (Kennedy, J., concurring) (noting that courts should act with self-discipline in refraining from nonchalantly applying exceptions to the plain meaning rule); Lamie, 540 U.S. at 538 (stating that the “unwillingness to soften the import of Congress' chosen words . . . results from ‘deference to the supremacy of the Legislature, as well as recognition that Congressmen typically vote on the language of a bill.’”) (quoting United States v. Locke, 471 U.S. 84, 95 (1985) (internal citation omitted)).

There is a hierarchical approach that courts must follow in construing a statute. First, the Court “determine[s] whether the language at issue has a plain and unambiguous meaning.” Dobrek v. Phelan, 419 F.3d 259, 263 (3d Cir. 2005) (citing Barnhart v. Sigmon Coal Co., 534 U.S. 438, 450 (2002)). In order to be ambiguous, the disputed language must be “reasonably susceptible of different interpretations.” Id. at 264 (quoting Nat’l R.R. Passenger Corp. v. Atchison Topeka & Santa Fe Ry. Co., 470 U.S. 451, 473 n.27 (1985)). The plain meaning approach requires a court to “read the statute in its ordinary and natural sense.” Harvard Secured Creditors Liquidation Trust, v. I.R.S. (In re Harvard Indus., Inc.), 568 F.3d 444, 451 (3d Cir. 2009) (internal quotation marks and citations omitted). If the language is clear, “‘Congress says in a statute what it means and means in a statute what it says there.’” Singer v. Franklin Boxboard Co. (In re Am. Pad & Paper Co.), 478 F.3d 546, 554 (3d Cir. 2007) (quoting Hartford Underwriters Ins. Co. v. Union Planters Bank, N.A., 530 U.S. 1, 6 (2000) (internal quotation marks and citation omitted)). If no ambiguity exists, then the plain meaning of the text is conclusive and the inquiry generally comes to an end. Lawrence v. City of Phila., Pa., 527 F.3d 299, 316-17 (3d Cir. 2008) (“The plain meaning of the text should be conclusive, except in the rare instance when the court determines that the plain meaning is ambiguous.”); AT & T, Inc. v. F.C.C., 582 F.3d 490, 498 (3d Cir. 2009)(finding that a determination that the statutory language was unambiguous negates consideration of arguments concerning statutory purpose, non-binding case law, and legislative history).

Second, if the statutory language appears to be unambiguous, a court must look beyond that plain language where a literal interpretation would lead to an absurd result, or would otherwise produce a result “demonstrably at odds with the intentions of the drafters.” United States v. Ron Pair Enters., Inc., 489 U.S. 235, 242 (1989) (internal quotation marks omitted); In re Kaiser Aluminum Corp., 456 F.3d 328, 330 (3d Cir. 2006) ("A basic principle of statutory construction is that we should avoid a statutory interpretation that leads to absurd results.") (citing Griffin v. Oceanic Contractors, Inc., 458 U.S. 564, 575 (1982)); Mitchell v. Horn, 318 F.3d 523, 535 (3d Cir. 2003) ("We do not look past the plain meaning unless it produces a result demonstrably at odds with the intentions of its drafters . . . or an outcome so bizarre that Congress could not have intended it."). It is only in “rare cases” that a literal application will produce such results. See In re Mehta, 310 F.3d 308, 311 (3d Cir. 2002) (internal citation omitted); Abdul-Akbar, 239 F.3d at 313 (internal citation omitted).

Third, if application of the plain meaning approach dictates that the language is ambiguous or that application of the statute would lead to results demonstrably at odds with congressional intent, then the Court may employ other traditional tools of statutory interpretation.

Where the plain meaning approach does not clearly define the disputed language, the Court should construe the relevant provision in the context of the statute as a whole. Kaufman v. Allstate N.J. Ins. Co., 561 F.3d 144, 156 (3d Cir. 2009) (citing Dolan v. U.S. Postal Serv., 546 U.S. 481, 486 (2006)). It is inappropriate, however, to reference other statutory provisions in order to create an ambiguity where none would otherwise exist. See Dir., Office of Workers' Comp. Programs v. Sun Ship, Inc., 150 F.3d 288, 292 (3d Cir. 1998) (finding that related statutory sections could not be used to create an ambiguity where the language was clear).

Further, courts may resort to canons of statutory construction, such as ejusdem generis, when the plain meaning approach does not yield a conclusive result. Baltimore County, MD. v. Hechinger Liquidation Trust (In re Hechinger Inv. Co. of Del., Inc.), 335 F.3d 243, 254 (3d Cir. 2003) (concluding that even if section 1146 of the Bankruptcy Code was ambiguous, the court’s interpretation was supported by two canons of construction); Folger Adam Sec., Inc. v. DeMatteis/MacGregor JV, 209 F.3d 252, 258 (3d Cir. 2000) (applying canons of construction to ambiguous term “any interest” in section 363(f) of the Bankruptcy Code). These canons of construction only serve as rules of thumb and “are often countered ... by some maxim pointing in a different direction.” United States v. Cooper, 396 F.3d 308, 313 (3d Cir. 2005)

One tool often used in parsing out ambiguity in the language of the statute is legislative history. It is recognized that legislative history is a “useful and appropriate tool for [an] inquiry into congressional intent” when the plain statutory text is ambiguous. Francis v. Mineta, 505 F.3d 266, 270-71 (3d Cir. 2007); In re Harvard Indus., 568 F.3d at 451. Cf. Hay Group, Inc. v. E.B.S. Acquisition Corp., 360 F.3d 404, 406 (3d Cir. 2004) (“The Supreme Court has repeatedly explained that recourse to legislative history or underlying legislative intent is unnecessary when a statute's text is clear and does not lead to an absurd result.”) (internal citation omitted). Based upon the inherent difficulty in distilling precise congressional intent from the amorphous nature of legislative history, however, the Third Circuit has instructed that “[f]or the vast majority of ambiguous statutory provisions, then, relying on legislative history to discern legislative intent should be done with caution, if at all.” Morgan v. Gay, 466 F.3d 276, 278 (3d Cir. 2006).

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Yesterday, after posting a link to a productivity guide recommending email be checked twice daily, I saw this leaked email from a big name at a litigation powerhouse:

Now more than ever there are many talented lawyers and law firms competing for our business. Doing really good legal work is not enough. Clients expect that and well they should given what we charge for our services You must all realize that we are in a service business. In this day and age of faxes, emails, internet, etc. clients expect you to be accessible 24\7. Of course, that is something of an exaggeration—but not much.

LESSON NUMBER ONE: You should check your emails early and often. That not only means when you are in the office, it also means after you leave the office as well. Unless you have very good reason not to (for example when you are asleep, in court or in a tunnel), you should be checking your emails every hour. One of the last things you should do before you retire for the night is to check your email. That is why we give you blackberries. I can assure you that all of our clients expect you to be checking your emails often. I am not asking you to do something we do not do ourselves. I can assure you that [other big names at the firm], etc. all check their emails often.

I check my email frequently except when I don't.

There's two reasons for those times that I don't.

First, to follow the advice of Seneca, himself a great trial lawyer, on keeping a law practice in perspective:

Look at those whose prosperity men flock to behold; they are smothered by their blessings. To how many are riches a burden! From how many do eloquence and the daily straining to display their powers draw forth blood! How many are pale from constant pleasures! To how many does the throng of clients that crowd about them leave no freedom! In short, run through the list of all these men from the lowest to the highest—this man desires an advocate, this one answers the call, that one is on trial, that one defends him, that one gives sentence; no one asserts his claim to himself, everyone is wasted for the sake of another.

But there are also less lofty reasons to avoid the siren song of the crackberry.

The second reason I take time off from email — both scheduled time and time as needed — is to follow Sun Tzu's command: "Ponder and deliberate before you make a move."

Cognitive science agrees:

After a 30-minute study period, the students were separated into three groups to test their understanding of the larger "big picture" relationship between the individual patterns: Group One was tested after a period of 20 minutes; Group Two was tested after a 12-hour period; and Group Three was tested after a 24-hour time span. In addition, approximately half of the students in Group Two slept during the 12-hour period, while the other half remained awake. All of the students in Group Three had a full night's sleep.

The test results showed striking differences among the three groups, especially between the students who had a period of sleep and those who remained awake.

"Group One, the students who were tested soon after their initial learning period, performed the worst," says Walker. "While they were able to learn and recall the component pieces [for example, Shape A is greater than Shape B, Shape B is greater than Shape C] they could not discern the hierarchical relationships between the pieces [Shape A is greater than Shape C] -- they couldn't yet see 'the big picture.'"

Groups Two and Three, on the other hand, demonstrated a clear understanding of the interrelationship between the pairs of shapes.

"These individuals were able to make leaps of inferential judgment just by letting the brain have time to unconsciously mull things over," he says. But, perhaps most notable, he adds, when the inferences were particularly difficult, the students who had had periods of sleep in between learning and testing significantly outperformed the other groups.

Strategic planning and tactical maneuvering in litigation requires a lot of thought, including the serious application of inferential judgment and relational memory, the types of cognitive work that demand contemplation and downtime.

Make room for that cognitive work. The crackberry can wait.

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In a comment on Overlawyered, Ted Frank points to his draft paper (with Marie Gryphon), Negotiating in the Shadow of 'Bad Faith' Refusal to Settle: A Game Theory Model of Medical Malpractice Pre-Trial Settlements and Insurance Limits:

Recent empirical studies of Texas data by Hyman et al, Zeiler et al, and Silver et al suggest that insurance limits affect settlements of medical malpractice cases. Writing separately, Silver argues that insurance limits act as a de facto cap on malpractice payouts, that plaintiffs are being underpaid as a result, and that therefore legislative caps on damages are unnecessary. But this hypothesis is inconsistent with the data, which indicates that forty-seven percent of cases in which plaintiffs obtain verdicts above policy limits are subsequently settled above policy limits. We propose to reconcile the data by accounting for the effects that third-party causes of action for alleged bad-faith refusal to settle — known in Texas as a Stowers action — have on pretrial settlement negotiations. If an insurer in Texas is presented with a settlement offer within insurance limits, refuses to settle, and the plaintiff wins an award greater than insurance limits, the plaintiff is entitled to sue the insurer for the full damages amount, plus punitive damages, for refusal to settle. In this paper, we explore the game theory of medical malpractice settlement negotiations in the shadow of Stowers.

Based on their (admittedly, and necessarily, simplistic) model of malpractice settlements, they run a Monte Carlo simulation.

It's not a bad idea, but they've missed one of the most important factors in settlement — the willingness and ability of the plaintiff to fight through years of risky litigation, trials, appeals and bankruptcy, where they must succeed 100% of the time to recover — and haven't shown why the existence of third-party bad faith lawsuits (i.e., those brought by the plaintiff against the defendant's insurer) contribute more towards settlement than the existence of first-party bad faith lawsuits (i.e., those brought by the defendant against their insurer).

Let's start with the biggest missing element from their model:

Silver, et al. suggests that there are polite reasons not to seek more than [the insurance policy limits]. But this hypothesis contradicts both what we know about the incentives of attorneys and the empirical data. Are we to believe that trial lawyers, out of the goodness of their heart, refuse to seek more than [insurance policy limits]? This seems improbable: the insured doctor is likely to have substantial assets, trusts provide limited protection, and the plaintiff attorney’s fiduciary duty to her client requires her to zealously pursue the doctor’s assets.

There are indeed "goodness of heart" considerations: it's psychologically easier to take an insurance company's reserves — which have been collected and maintained for the purpose of compensating injured plaintiffs — than to take an individual's personal assets.

But let's put that aside and focus on the money. Keep in mind that, in most circumstances, the insurer can't just pay their policy limits and wave goodbye to the defendant while the plaintiff goes after the defendant's assets. If the defendant doesn't want to pay any of their own money, then the insurance company will keep defending them to a full and final conclusion, without paying the plaintiff a dime in the meantime.

Most often, the settlement of an above-policy-limits claim at policy-limits is not due to the goodness of anyone's heart: it's the rational choice between either settling at insurance policy limits and walking away with the money now, or refusing the insurance money and then chasing the doctor's assets for years (with five-or-six figure additional costs) through trial, appeals, re-trials, bankruptcy, bankruptcy appeals, and bankruptcy discharge, which often pays unsecured creditors a fraction of their claim's value. And don't forget: the plaintiff has to be successful in each and every one of those proceedings.

If the insurer actually tenders their full policy limits, then my "fiduciary duty" to the client typically compels me to recommend the client take the policy limits now, rather than starve themselves for years and endure the substantial risks of running the entire civil legal gauntlet — where they must succeed 100% of the time to recover anything — for a theoretical shot at more.

To their credit, the authors admit at the end that they haven't included these factors:

This is still a relatively simple model: it assumes instantaneous and frictionless rulings, rather than an expensive process that may take several years with substantial fees for attorneys and medical expert witnesses. We assume that the trial court’s judgment is 100% accurate, and that there will be no appeal. We therefore do not consider the issue of post-trial settlement. In real life, the risk that a favorable judgment will be struck on appeal one reason why so many large judgments are settled so seemingly favorably, but it is impossible to estimate the size of this effect without qualitative data that the Hyman “haircut” study does not have.

Trials take years. We make no effort to compare the value of a settlement in the hand with a judgment several years in the future that is stayed by appeal. On the other hand, Texas has relatively generous post-judgment interest rates with a floor of 5%. Expanding the model to consider the time-value of money from early settlement would be useful in adjudging the merits and effects of the so-called “early offers” reform. As Zeiler notes, such time-value can also result in settlements below policy limits by virtue of aggressive negotiating by insurers.

Those two economic issues — the risk of losing on appeal (and/or retrial) and the time value of money — create a massive disincentive against attempting to pursue assets beyond the insurance policy limits. Post-judgment interest is generally irrelevant in the context of cases with damages/judgments larger than insurance proceeds: unless the plaintiff wants to go all the way through appeals, retrials, judgment execution, and bankruptcy, then, regardless of any post-judgment interest, the plaintiff's recovery is still effectively capped at the insurance policy limits.

That's the first problem: the failure to consider the effect of the willingness and ability of the plaintiff to fight through years of risky litigation on settlement.

Here's the second problem: the authors "add a Stowers factor S, which is equal to expected Stowers recovery given a victory at the underlying medical malpractice trial" but don't say how they calculate S. More importantly, though, they don't explain why a third-party bad faith recovery would be expected to be any larger than the first-party bad faith claim available to the doctor if she believes the insurer did not handle the case properly.

When an insurer worries about a potential bad faith claim, they're not just worried about the plaintiff suing them. Indeed, they're usually more worried about the defendant suing them.

Like Dr. Woo:

Robert C. Woo is a Seattle-area dentist. An online guide praises his "first-class service" and "painless procedures." It is likely that Tina Alberts, his former assistant, disagrees.

Alberts cared for pot-bellied pigs, a frequent topic for office banter. Dr. Woo enjoyed taunting her with accounts of his boar-hunting trips, and a picture of a skinned pig hanging from a hook. He predicted a similar fate for Walter, her beloved pet pig. Dr. Woo informs us that this was all part of a "friendly working environment."

When Alberts required surgery to replace two teeth, Dr. Woo saw an opportunity to cement this self-impression of bonhomie. Once she was completely sedated, he halted the agreed procedure, and began a new one. Replacing her teeth required the temporary installation of standard false teeth. Dr. Woo had secretly ordered a second set of temporary teeth, shaped like boar tusks. Removing her oxygen mask, he inserted the tusks and - we must assume this was part of the friendly working environment - took photographs of her with her eyes and mouth pried open. Returning at last to his professional duties, he removed the tusks and inserted the correct temporary teeth.

A month later, Dr. Woo's staff presented Alberts with the pictures at her birthday party. The fun-loving Woo described them as a "trophy" to take home. Home she went, never to return. Instead, she sued Dr. Woo for battery, invasion of privacy, medical malpractice, and a host of related claims.

Dr. Woo's insurance company refused to defend him in Alberts' lawsuit. Dr. Woo settled the case on his own for $250,000, then sued his insurance company.

And won:

Because his insurer should have defended him, Dr. Woo recovered the $250,000 he had paid Alberts. But he also claimed emotional distress due to his insurer's abandonment. Despite "the absence of any medical, psychiatric or expert testimony" attesting these injuries, a jury awarded him $750,000, which suggests the rather even quality of justice throughout the judicial system of Washington State. And naturally, Fireman's had to pay for Dr. Woo's legal costs.

The end result was exactly what Ted Frank and Marie Gryphon's paper is supposed to focus on: a situation in which an insurance company was forced to pay more than the policy limits for a malpractice claim. Yet, in Dr. Woo's case, the third-party Stowers action had nothing to do with it — it was a purely first-party claim brought by the doctor. 

I hope there's more study down this field; the world of litigation and defense & indemnity insurance is ripe for rigorous game theory analysis. But it needs to be as thorough and rigorous as the study of any other economic situation.

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Via Atrios, we have Stanley Fish's recent NYTimes column, The Rise and Fall of Academic Abstention:

As recently as 1979, legal academics Virginia Nordin and Harry Edwards were able to say that “historically American courts have adhered fairly consistently to the doctrine of academic abstention in order to avoid excessive judicial oversight of academic institutions” (Higher Education and the Law). Academic abstention is the doctrine (never formally promulgated) that courts should defer to colleges and universities when it comes to matters like promotions, curricula, admission policies, grading, tenure, etc. The reasoning is that courts lack the competence to monitor academic behavior; they should get out of the way and let the professionals do the job. “Courts are particularly ill-equipped,” Chief Justice Rehnquist declared in 1978, “to evaluate academic performance.” (Board of Curators of the University of Missouri v. Horowitz)

In 2009, courts still pay lip service to this doctrine but in practice, Amy Gajda tells us in her terrific new book, “The Trials of Academe,” they now boldly go where their predecessors feared to tread. Once, “if a student or faculty member had the temerity to bring a grievance to court, is was likely to be bounced out in short order.” Now, however, “courts feel free to enter . . . from the ground up, parceling out the right and obligations of each disputant down to the last dollar.” Indeed, “litigation and ‘rights talk’ have permeated every crease and wrinkle of academic life.”

Fish concludes,

When I began teaching in 1962 at the University of California in Berkeley, I asked older colleagues about the decorums and rules of the classroom. In response, I was given the Myron Brightfield rule. Brightfield was then a very senior member of the department. His rule (and I paraphrase) was, When you close the door, there’s nothing they can do to you. Those were the days, and they had their injustices as well as their advantages. Now we have justice, or at least the demand for justice, all the time and it may, Gajda suggests, be killing us.

Rubbish.

Fish highlights several cases to make his argument-by-anecdote. Let's look at his "favorite:"

My favorite (and Gajda’s, too) involves a student in osteopathic medicine who, after failing an important rotation, was dismissed because “he didn’t have the basic understanding that he should have as a fourth-year medical student.” The student sued on the grounds that he had been promised a degree by a phrase in a student handbook that described the program he was enrolled in as “a four-year curriculum leading to the DO degree.”

Anyone with the slightest familiarity with the way universities work would know that ‘”leading to” included the qualification “provided that the requirements for graduating were met” — a medical degree is not equivalent to the certificate you get for having completed six weeks of a summer camp — but the courts were persuaded to a more literal (and perverse) reading and awarded the plaintiff a partial tuition reimbursement. But he wanted more and he got it by arguing that he should receive an amount commensurate with the earnings he would have accumulated had the “promised” degree been conferred. Jurors ordered the medical school to pay him $4.3 million.

The case is Sharick v. Southeastern Univ. of the Health Scis., 780 So. 2d 136, (Fla. Dist. Ct. App. 3d Dist. 2000).

Indeed, as Fish says, anyone with "the slightest familiarity" with academia knows that the award of a degree is predicated on meeting the school's requirements — except, of course, for the school in question, which argued the student "contracted with [the school] solely to provide an education in exchange for payment of tuition." Id., 139 (emphasis added).

Got that? The school's argument was that, regardless of whether the student met the requirements, all the school contracted to do was "provide an education" and not actually award the degree. That is to say, the school argued that it was free to destroy the student's career for any reason, a bad reason, or no reason, so long as it had "educated" him in a way the student couldn't possibly use without the actual degree. The court disagreed. So do I. So, too, apparently, does Fish.

Contrary to Fish and Gadja's description, the student didn't allege the school "promised" a degree but didn't give it because he failed, he alleged that "Southeastern's decision to dismiss him [two months before his graduation] was arbitrary, capricious, and/or lacking any discernable rational basis." Id., 138. It's the only way he could recover under Florida law, in light of the "academic abstention" doctrine that Fish claims has been "increasingly narrowed to the point that it is in danger of vanishing."

A jury agreed with the student. In fact, the evidence against the school was so overwhelming that Southeastern didn't even appeal the jury's findings. The school only appealed the trial judge's rejection of their ridiculous and insulting "solely to provide an education" argument.

Let me tell you, as a plaintiff it's not easy to prove "arbitrary and capricious" behavior. It's one of the highest bars a plaintiff can ever face, and typically results in the plaintiff losing. Do you have any doubt that, if Southeastern had any credible defense at all, it would have appealed the jury's findings? All they had to show was some reason — any reason — justifying the student's dismissal and the verdict would have been overturned.

Yet, they didn't even try, presumably because they knew they couldn't. Rather than making things right, however, they forced him into over fifteen years of litigation, litigation which is still going on. See the most recent appeal, Nova Southeastern Univ. of the Health Scis., Inc. v. Sharick, 2009 Fla. App. LEXIS 12494 (Fla. Dist. Ct. App. 3d Dist. Aug. 26, 2009)

How are we to take Fish or Gadja seriously when their "favorite" example shows why academic institutions should not be above the law?

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SCOTUSBlog reports:

The Supreme Court agreed on Tuesday to rule on claims that “searing media attacks” on longtime Enron executive Jeffrey K. Skilling tainted his criminal trial and conviction on various fraud charges.  The case of Skilling v. U.S. (08-1394) also raises an issue on the scope of the federal law punishing the failure to provide “honest services” as a corporate executive.

In his petition to the Supreme Court, Skilling argued,

In closing argument, the government declared that Skilling and Lay committed honest-services fraud because they violated a duty to Enron’s “employees”—a duty the government described as “a duty of good faith and honest services, a duty to be truthful, and a duty to do their job, ladies and gentlemen, to do their job and do it appropriately.”

Of critical importance here, the government argued that Skilling committed every alleged act of misconduct with the specific intent to advance Enron’s interests—by increasing reported earnings, maintaining an investment-grade credit rating, and improving the price of Enron’s stock. ... The government did not contend, and the record did not suggest in any way, that Skilling intended to put his own interests ahead of Enron’s. To the contrary, the government’s stated theory was that its evidence needed only to show—and did only show—“a material violation of a fiduciary duty that defendants owed to Enron and its shareholders.”

...

The Fifth Circuit erred in holding that a conviction under § 1346 is valid even where the defendant did not seek to elevate material private interests over his employer’s. Even that limitation may not suffice to save the statute from unconstitutional vagueness, but it at least establishes some reasonably clear and intelligible boundary to the statute. It also reflects the pre-McNally understanding of honest-services fraud Congress sought to adopt in § 1346.

As Justice Scalia recently observed, the statute on its face sweeps in a breathtaking range of conduct. Sorich, 129 S.Ct. at 1310. The phrase “honest services” itself provides no clear guidance as to “how far the intangible rights theory of criminal responsibility really extends.” Bloom, 149 F.3d at 656; see Sorich, 523 F.3d at 707 (§ 1346 is “amorphous and open-ended”); Urciuoli, 513 F.3d at 294 (“the concept of ‘honest services’ is vague and undefined”); Brown, 459 F.3d at 520 (§ 1346 is a “facially vague criminal statute”); Murphy, 323 F.3d at 116 (“the plain language of § 1346 provides little guidance as to the conduct it prohibits”); U.S. v. Handakas, 286 F.3d 92, 105 (2d Cir. 2002) (“the text of § 1346 simply provides no clue to the public or the courts as to what conduct is prohibited”), overruled in part by Rybicki, 354 F.3d at 144; U.S. v. Brumley, 116 F.3d 728, 736 (5th Cir. 1997) (Jolly & DeMoss, JJ., dissenting) (§ 1346 is “general, undefined, vague, and ambiguous”). ...

Several lower courts, however, have sought to resolve the problem of the statute’s facial ambiguity by reading into the text limitations on “honest services” fraud. The “private gain” requirement is among the clearest of those limitations, and it is drawn directly from the pre-McNally cases that created the concept of honest-services fraud. McNally itself stated the rule: “Under [the prior honestservices] cases, a public official owes a fiduciary duty to the public, and misuse of his office for private gain is a fraud.” Id. at 355 (emphasis added).

Applying a private-gain limitation to honest services fraud is the only way to even arguably “avoid the constitutional question” raised by the vagueness of the phrase “honest services.” Jones v. U.S., 529 U.S. 848, 858 (2000). Absent that limitation, the statute is nothing more than a common-law fiduciary-breach statute, impermissibly criminalizing whatever wrongful or unethical corporate acts a given prosecutor decides to attack. Brown, 459 F.3d at 521-22; Bloom, 149 F.3d at 654.

 Here's the whole statute at issue:

For the purposes of this chapter, the term “scheme or artifice to defraud” includes a scheme or artifice to deprive another of the intangible right of honest services.

It defines part of the statute for "fraud by wire, radio, or television:"

Whoever, having devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises, transmits or causes to be transmitted by means of wire, radio, or television communication in interstate or foreign commerce, any writings, signs, signals, pictures, or sounds for the purpose of executing such scheme or artifice, shall be fined under this title or imprisoned not more than 20 years, or both. ...

He may be on to something.

Then again, is there really any "vagueness" to the notion that fraud is criminal? Does anyone really throw their hands up into the air and proclaim that they don't know if it's illegal to defraud investors for the benefit of a company that pays that person millions every year, a company of which they own millions of dollars worth of shares?

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Howard Bashman (of How Appealing) has a new article in The Legal Intelligencer:

Recently, however, in cases where I am representing the party that won in the trial court, I have observed experienced appellate opposing counsel who will designate the contents of the appendix or reproduced record on appeal in a far more "adversarial" manner than I would have done had I been in their position. What I mean is that the designation they are serving will include only the parts of the record that benefit their client's position, while excluding (at least until I counterdesignate them in response) those parts of the record that favor my client's position and the trial court's ruling.

Because other experienced appellate advocates are now frequently engaging in a more "adversarial" method of appendix designation than I am, I cannot help but wonder whether this "adversarial" method ever succeeds. In other words, if counsel for appellee is inexperienced or inattentive, presumably the "adversarial" method of appendix designation could ultimately result in an appellate appendix that was bereft of the evidence and other material on which the party that won in the trial court would wish to rely in arguing for affirmance of the trial court's ruling.

Howard has a good argument against the practice and why it's unlikely to succeed. Assuming the court doesn't recognize what's happening and punish the offending party for it, let's consider the question from the perspective of game theory.

The more information available to a court about a case, the more informed and thus more sound the court's analysis will be. Conversely, the less a court knows about a case, the less informed and thus less sound its opinion will be.

I agree with Howard: limiting the appellate record makes it harder for the appellate court to closely and carefully review the case, which increases the risk to both parties of the appellate court unintentionally rendering an ill-informed opinion unjustified by the actual facts.

If a party believes they have a strong case and that they will prevail on appeal, that additional risk is a bad thing. Hence their desire for as complete a record as possible.

But if a party believes they have a weak case that's likely to lose at appeal, however, then they have an incentive to make the record incomplete, and thereby increase the likelihood of the appellate court issuing an erroneous or ill-informed opinion.

Though the losers at the trial level probably have this incentive more often than the winners, the winners can have it as well — if the party that won at trial thinks their victory is unlikely to survive appeal, then they, too, have an incentive to make the record incoherent and incomplete, thereby frustrating review. Indeed, the winning party might have more of an incentive to mess up the record, if they believe, as many lawyers do, that appellate courts generally defer to trial courts, even where the standard of review is de novo.

Perhaps not the most upstanding of tactics, but not necessarily a foolish one.

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I admire Judge Posner, one of the flag bearers for the law and economics movement. He is thoughtful, prolific, and has not succumbed to the extraordinary pressure judges feel to guard their actual thoughts and feelings. He is in every sense of the word an open book, and we should be grateful for that.

It also makes him the logical target for critics of any of the ideas he champions. Such is the case for my remarks below.

I rather enjoyed Posner's latest article, How I Became A Keynesian, which does as good a job as any at summarizing Keynes' core philosophy, until I came across this paragraph:

But the government may be able to arrest the decline--another of Keynes's central ideas, and one strongly resisted by the conservative economists of his time, as of today. It can reduce interest rates (by buying government bonds or other debt for cash, which increases the amount of money that banks are permitted to lend) in an effort to reduce the costs of active investment and thus encourage employment. Keynes urged this approach. But he also pointed out that it might not work well--as we have learned in the current downturn. The banks may lack confidence in "those who seek to borrow from them," so that "while the weakening of credit is sufficient to bring about a collapse, its strengthening, though a necessary condition of recovery, is not a sufficient condition." In fact, banks in America today are hoarding, rather than lending, most of the cash that they have received from the government's bailouts. The hoard may make the banks a little freer with lending, but the effect on economic activity, at least in the short run, may be tepid.

In sum: the government can "arrest" an economic decline by taking action to "reduce interest rates," but such has "not work[ed] well ... in the current downturn."

Perhaps he's correct. Then again, perhaps he was correct a month ago when he wrote that "the various factors that are responsible for the reduction in the rate of decline of output" last quarter are "probably impossible" to "disentangle:"

This assertion is groundless. No one has the faintest idea what effect the stimulus has had. My guess is that it has had some positive effect, because of its confidence-enhancing character that I mentiioned earlier and because some of the $100 billiion--though no one seems to know how much--has been spent rather than saved. But it is impossible to determine the net impact of the stimulus on GDP or employment because so much else has been happening to stimulate an economic recovery. Some people have had to dissave--turn savings into expenditures--because their income has fallen (maybe because they have become unemployed) below the level necessary to cover their basic expenses. Some people have had to replace durables that wore out. Foreign demand for U.S. products has risen some. (Dissaving, replacing durables, and export growth if the domestic currency loses value are standard nongovernmental spurs to recovery from a depression.) And the government has been doing a lot to stimulate recovery besides the stimulus--has in fact expended or guaranteed trillions of dollars in an effort to increase the amount of lending, which is essential to economic activity.

Disentangling the various factors that are responsible for the reduction in the rate of decline of output in the second quarter is probably impossible, but in any event has not, to my knowledge, been attempted--and certainly not in Romer's talk.

Which Posner do I believe? The one who asserts that "disentangling the various factors" affecting the economy "is probably impossible" (with whom economists vehemently disagree), or the one who asserts as a matter of fact that, of the "various factors" affecting the economy, government efforts to "reduce interest rates" "might not work well?"

Of course, Keynes himself famously responded to a critique that he had changed his mind about the causes of the Great Depression with: "When the facts change, I change my mind. What do you do, sir?"

The facts here, however, have not changed. The columns were published a month apart.

That, too, would be perfectly fine -- Richard Posner, the man, is entitled to his own thoughts and opinions and should change them as befits further thought, data, argument and experience -- but for the belief of many adherents to "law and economics"  that judges' interpretations and application of economic theory should color their judicial decisions.

There's a difference, of course, between the macroeconomics that trouble Posner and the microeconomics at play in most cases. And there's a difference, of course, between recognizing the contributions that economics can bring to legal policy decisions (which is what the original law and economics scholars, like Ronald Coase and Guido Calabresi, focused on) and enabling courts to decide cases by way of economic theories they are not even trained to understand, much less apply.

These distinctions, however, rapidly break down in actual practice. Witness the Twombly Supreme Court opinion, in which seven Justices, none of which have any formal training in economics, held the following as a matter of law:

The complaint makes its closest pass at a predicate for conspiracy with the claim that collusion was necessary because success by even one CLEC in an ILEC’s territory “would have revealed the degree to which competitive entry by CLECs would have been successful in the other territories.” Id., ¶50, App. 26–27. But, its logic aside, this general premise still fails to answer the point that there was just no need for joint encouragement to resist the 1996 Act; as the District Court said, “each ILEC has reason to want to avoid dealing with CLECs” and “each ILEC would attempt to keep CLECs out, regardless of the actions of the other ILECs.” ...

Plaintiffs’ second conspiracy theory rests on the competitive reticence among the ILECs themselves in the wake of the 1996 Act, which was supposedly passed in the “ ‘hop[e] that the large incumbent local monopoly companies … might attack their neighbors’ service areas, as they are the best situated to do so.’ ... Contrary to hope, the ILECs declined “ ‘to enter each other’s service territories in any significant way,’ ” Complaint ¶38, App. 20, and the local telephone and high speed Internet market remains highly compartmentalized geographically, with minimal competition. Based on this state of affairs, and perceiving the ILECs to be blessed with “especially attractive business opportunities” in surrounding markets dominated by other ILECs, the plaintiffs assert that the ILECs’ parallel conduct was “strongly suggestive of conspiracy.” Id., ¶40, App. 21.

But it was not suggestive of conspiracy, not if history teaches anything. In a traditionally unregulated industry with low barriers to entry, sparse competition among large firms dominating separate geographical segments of the market could very well signify illegal agreement, but here we have an obvious alternative explanation. In the decade preceding the 1996 Act and well before that, monopoly was the norm in telecommunications, not the exception. ... The ILECs were born in that world, doubtless liked the world the way it was, and surely knew the adage about him who lives by the sword. Hence, a natural explanation for the noncompetition alleged is that the former Government-sanctioned monopolists were sitting tight, expecting their neighbors to do the same thing.

 In fact, the complaint itself gives reasons to believe that the ILECs would see their best interests in keeping to their old turf. Although the complaint says generally that the ILECs passed up “especially attractive business opportunit[ies]” by declining to compete as CLECs against other ILECs, Complaint ¶40, App. 21, it does not allege that competition as CLECs was potentially any more lucrative than other opportunities being pursued by the ILECs during the same period and the complaint is replete with indications that any CLEC faced nearly insurmountable barriers to profitability owing to the ILECs’ flagrant resistance to the network sharing requirements of the 1996 Act, id., ¶47; App. 23–26. Not only that, but even without a monopolistic tradition and the peculiar difficulty of mandating shared networks, “[f]irms do not expand without limit and none of them enters every market that an outside observer might regard as profitable, or even a small portion of such markets.” Areeda & Hovenkamp ¶307d, at 155 (Supp. 2006) (commenting on the case at bar). The upshot is that Congress may have expected some ILECs to become CLECs in the legacy territories of other ILECs, but the disappointment does not make conspiracy plausible. We agree with the District Court’s assessment that antitrust conspiracy was not suggested by the facts adduced under either theory of the complaint, which thus fails to state a valid §1 claim.

Is the above economic analysis correct? We will never know -- even economists will never know -- since this economic theory was codified as law without anyone reviewing the empirical data, because the Supreme Court dismissed the case prior to any discovery.

Twombly is not some outlier case hurriedly drafted by an overworked trial judge. It is the thoughtfully considered, yet wholly uninformed, product of the highest court in the land.

That's the problem with law and economics: it creates the illusion of judicial competence to interpret and apply economic theories to individual cases. Such is particularly problematic these days because economics is in a state of intellectual collapse and is plagued by conflicts of interest, making it particularly ripe for misuse and abuse in other fields, like the law.

Now that Posner has seen the light and become a Keynesian, will he recognize the criticisms of law and economics and become a legal realist?

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In a stunning display of judicial activism, two conservative judges on the United States Court of Appeals for the District of Columbia re-wrote several recent Department of Defense regulations, a sixty-year-old Act of Congress, a basic principle of federalism upheld by dozens of Supreme Court opinions, and millenia of common law to dismiss the Saleh v. Titan Corporation and Ibrahim v. Titan Corporation lawsuits brought by more than a dozen Iraqis who "were beaten, electrocuted, raped, subjected to attacks by dogs, and otherwise abused by private contractors working as interpreters and interrogators at Abu Ghraib prison." Dissent op., p.1. The United States was not a defendant, nor were the military officers. The lawsuit was solely against the private contractors.

You already know the "allegations" -- you've probably already seen much of the evidence. There's no doubt what happened. It was "abhorrent" and "[doesn't] represent America” according to President Bush. Secretary Rumsfeld assured “[t]he people of the Middle East . . . that we will investigate fully, that we will find out the truth . . . and [that] justice will be served.” Dissent op., p. 2. Ilham Nassir Ibrahim isn't around for justice; he was beaten to death while in captivity. His widow is one of the plaintiffs.

The prohibition on unauthorized violence, even against prisoners, is universal to civilization. Under the Code of Hammurabi, if a prisoner like Ibrahim died "from blows or maltreatment," the responsible party's son was put to death. These days, torture for fun and profit without even the pretense of government authorization violates a panolopy of laws, including the Torture Victim Protection Act, the Racketeer Influenced and Corrupt Organizations Act, numerous common law torts (assault and battery, wrongful death and survival, intentional infliction of emotional distress, and negligence), government contracting laws, and various international laws and agreements.

To cover their bases, the plaintiffs sued under all of them. Surely at least one such claim would survive under centuries-old Anglo-American legal maxim -- reaffirmed by the most important Supreme Court decision in our history -- that "where there is a legal right, there is also a legal remedy by suit or action at law whenever that right is invaded?"

The plaintiffs' claims were strengthened by the absence of any Executive or Congressional action to stop them, despite numerous claims by the private contractors that the federal government had a substantial interest in the outcome of the case. The Bush and Obama administrations both declined to intervene in the case. Congress for a half-century now has authorized dozens of military actions which included the use of private contractors without passing a single law granting them immunity from suit.

The only related Congressional Act -- the Federal Tort Claims Act -- expressly says it "does not include any contractor with the United States.”  In fact, the only recent relevant action by either the Executive or Legislative branches is a regulation from the Bush-era Department of Defense stating that, for performance-based service contracts, "contractors [are] accountable for the negligent or willful actions of their employees, officers, and subcontractors." Dissent op., p. 22. The DoD further explained that "“[i]nappropriate use of force could subject a contractor or its subcontractors or employees to prosecution or civil liability under the laws of the United States and the host nation.” Id at p. 21.

The Supreme Court, too, has made it quite clear that, when a government contractor breaches its agreement with the government and thereby causes a third party harm, that contractor is responsible for the harm. In Miree v. DeKalb County, 433 U. S. 25 (1977), the victims of an airplane crash sued a county airport because it "breached the FAA [flight permission] contracts by owning and maintaining a garbage dump adjacent to the airport, and that the cause of the crash was the ingestion of birds swarming from the dump into the jet engines of the aircraft." After reiterating (consistent with prior law) that "the issue of whether to displace state law on an issue such as this is primarily a decision for Congress" and noting "Congress has chosen not to do so in this case," the Supreme Court affirmed the victims' right to sue. Keep that "primarily a decision for Congress" concept, a basic principle of federalism recently upheld in Wyeth v. Levine, in mind -- we'll come back to it later.

Why, then were the Abu Ghraib cases dismissed? Judicial activism, plain and simple: having no act of Congress, no Executive decision (in fact, regulations to the contrary), and no applicable Supreme Court precedent to support their preferred policy outcome, two conservative judges invented an entirely new judicial doctrine.

The judges didn't say that, of course. They claimed to be applying existing law.

A bit of background is required to see why that's not true. Though Miree is the general rule for lawsuits brought by third parties injuried by government contractors who breach their contracts, an exception for government manufacturers who perform their contracts properly was created by Boyle v. United Technologies Corp., 487 U.S. 500 (1988), where a United States Marine helicopter copilot was killed when his CH-53D helicopter crashed off the coast of Virginia Beach and he drowned. His family brought a lawsuit against the manufacturer of the CH-53D, alleging that the helicopter was defective because escape hatch opened out instead of inward, and thus was impossible to open underwater.

The Supreme Court held the family could not recover against the manufacturer because that design had been specifically required by the government, and thus the federal procurement specification "preempted" any claims of negligence, rendering the contractor immune from suit for following those specifications. Make no mistake: as the Supreme Court later described Boyle, preemption and immunity for government contractors applies only in the "special circumstance" where the “government has directed a contractor to do the very thing that is the subject of the claim.”  Correctional Services Corp. v. Malesko, 534 U.S. 61, 74 n.6 (2001)(applying the old Miree rule)

It's a sensible rule, even though one not enacted by Congress (as Miree and long-standing law said it should be). But it's also a very limited rule: as Justice Scalia wrote for the Supreme Court, it applies where "the asserted basis of the contractor's liability (specifically, the duty to equip helicopters with the sort of escape-hatch mechanism petitioner claims was necessary) is precisely contrary to the duty imposed by the Government contract (the duty to manufacture and deliver helicopters with the sort of escape-hatch mechanism shown by the specifications)."

Note those words: "precisely contrary." Scalia even gave an example of where it would not apply, such as where a government merely purchased air-conditioning units without any requirement contrary to a specific safety feature. As Scalia wrote, "no one suggests that state law would generally be preempted" if someone injured by the lack of that safety feature filed a lawsuit. Of course, absolutely no one suggested that a government contractor who breached their contract would be immune. As Scalia wrote, "conflict there must be" between the federal contract requirements and the lawsuit.

Compare "precisely contrary" and "conflict there must be" to Abu Ghraib, where the contractors intentionally breached their contracts through criminal conduct. Such is even less a case for preemption and immunity than Miree, where the breach was negligent, and which was reaffirmed by Boyle. Yet, Boyle is what the conservative judges claimed they were applying:

Slip op., p 13.

Did you catch all of that? The conservative judges took a twenty-year-old Supreme Court case admittedly involving the "special circumstance" where a plaintiff sued alleging a government manufacturer should have done the exact opposite of what the government told them to do, then, by way of a federal statute that expressly says it does not apply to contractors (the FTCA), the conservative judges applied that "special circumstances" to immunitize every private contractor in any "battle-field" -- which Abu Ghraib certainly wasn't -- who tortures and kills people without even the pretense of governmental authority.

In order to do that, the conservative judges also ran roughshod over the millenia-old prohibition on abusing prisoners, the centuries-old maxim that every right has a remedy, decades of precedent holding that Congress -- not the Courts -- is responsible for creating immunities, and recent crystal-clear Department of Defense regulations affirming that private contractors remain responsible for their wrongful conduct.

Judicial activism at its finest. Read the opinion yourself, if you dare. I recommend you start with the fine dissent by Judge Garland.

P.S. There's a reasonable chance the Supreme Court might grant certorari and reverse the opinion. Just this year, Justice Kennedy was part of the Wyeth v. Levine majority that held the Court starts with the presumption that state law is not to be superseded by federal immunities “unless that was the clear and manifest purpose of Congress.” 129 S. Ct. 1187, 1194-95 (2009). Keep your fingers crossed.

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Philip K. Howard, whose nonsense medical malpractice "health courts" idea I've panned before, is back pushing more hooey from two insurance and corporate front groups, Common Good and the Committee for Economic Development:

Because modern medicine is so complex, reliability almost certainly requires some kind of special court.  This country has a long history of such courts, such as bankruptcy courts, and it's hard to imagine an area of society in greater need of special judicial expertise than health-care.  That's why a broad coalition has come out for pilot projects--including AARP, the AMA, the American College of Obstetricians and Gynecologists, the Joint Commission on the Accreditation of Health-care Organizations, and many others

That's what the American people want as well.  Today, Common Good and the Committee for Economic Development released a survey that showed an astonishingly high 83 percent of voters want Congress to address reform of the medical malpractice system as part of any health-care reform plan.  Moreover, even though the survey found that most Americans generally favor jury trials, for health-care disputes they overwhelmingly support special health courts--an extraordinary 67 percent support a new court system for health-care.

83% of voters want Howard's brand of tort reform? That's certainly the impression you get from his article.

Read the actual survey. I dare you.

Here's the extraordinarily vague question they asked:

DO YOU AGREE OR DISAGREE WITH THIS STATEMENT: As part of any health care reform plan, Congress needs to change the medical malpractice system so that cases are resolved quicker, and more reliably, on behalf of those who are in the right.

Like that 83%, I, too, agree with that statement, as would every trial lawyer, consumer advocate, and patient I know. Our clients wait years just to have their cases heard in court, where they are subject to a variety of "unreliable" variables, including biased defense experts who invent "medicine" out of whole cloth. 

But it doesn't mean a thing about tort reform. It means the people generally want "to secure the just, speedy, and inexpensive determination of every action and proceeding," which nobody opposes.

Nice try; while you insurance companies are at it, perhaps you'd like to explain why you trust voters to decide health care policy issues but not sit on medical malpractice juries?

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The print edition of September's Emergency Physicians Monthly features a debate between yours truly and WhiteCoat, EPM's in-house blogger on the subject, "Does Medical Malpractice Liability Impact Access To Emergency Care?"

I've posted the debate below, with footnotes added to show my sources. I believe WhiteCoat will update his with sources when he gets a chance; you can find his post here.

Opening Argument - Max Kennerly

 A 2006 American College of Surgeons report[1] concluded, "the single most important factor shaping the [emergency] surgical workforce today is declining reimbursement," a euphemism for cutthroat health insurer tactics. Last month, Bayonne Hospital sued Horizon Blue Cross Blue Shield for a parade of horribles, such as calling patients, lying about their coverage, and instructing them to leave the ED prior to screening or stabilization.[2]

Against this backdrop, malpractice premiums are at a per-physician thirty-year low. Unbiased analysis of their effect, however, is in short supply. A.M. Best, which rates insurers' creditworthiness for banks, says premiums represent 0.45% of national health care expenditures[3; see also *]; Towers Perrin, an insurance consulting firm, says 1.5%.[4] Least credible is the American Hospital Association, which relies on the Lewin Group[5], part of Ingenix, a UnitedHealth subsidiary that recently agreed to a $400 million settlement for manufacturing phony fees data to short-change physicians.[6]

After a decade of declining premiums and claims payments in the 1990s, the stock market collapsed, prompting insurers to raise premiums rapidly. In 2003, the peak of the increases, the General Accounting Office surveyed five states with "reported malpractice-related problems" (including Nevada and Mississippi) and four without for the impact of liability on access to care[7]. The GAO found no impact in the latter and "scattered" reductions in the former by providers of ER surgical coverage and obstetricians, most of whom also faulted other "long-standing factors" like reimbursement.  The GAO concluded most reports were "unsubstantiated" and that malpractice liability "did not widely affect access to health care."

The same report found little evidence of "defensive medicine," criticizing a widely-cited Health & Human Services report (the source of that "$300 billion" figure) for its transparently flawed generalization from two narrow examples of elderly heart disease treatment. In 2004, the Congressional Budget Office followed up on the H&HS report[8], even using the same methods, yet "found no evidence that restrictions on tort liability reduce medical spending," deeming the evidence for defensive medicine "weak or inconclusive" and noting "some so-called defensive medicine may be motivated less by liability concerns than by the income it generates for physicians or by the positive (albeit small) benefits to patients."

Such did little to stop a wave of "tort reform" in many states, like capping noneconomic damages and eliminating joint and several liability. Several years later, we have control and experimental groups in our laboratory of democracy.

The 2009 American College of Emergency Physicians' Report Card on the State of Emergency Medicine[9] is a revelation: of the ten states with an "A" or "B" grade for their "medical liability environment" (the most hostile to patients), six had an "F" for "access to emergency care," one had a "D-," two had a "C-," and one had a "B-," together averaging below a "D-."  Mississippi and Nevada, too, took WhiteCoat's "tort reform" advice: years later, they have, respectively, a "C" and "C+" for liability and a "C-" and an "F" for access to care. Conversely, the nine states with an "F" for liability earned the only "A," had only one "F," and averaged a "C" for access to care, better than the national average of "D-."

But, tort reformers say, there are other factors. That's my point: the impact of malpractice liability on access to care is so small it appears positive because it is dwarfed by other factors such as Aetna, Cigna and WellPoint, all of whom the AMA recently sued[10] for also using the bogus Ingenix database, and the increase in uninsured or underinsured patients. The big change in the past generation has not been an increase in malpractice premiums or claims (both are at historic lows in inflation-adjusted dollars [see 1]) but an extraordinary decrease in reimbursement.

A 2003 AMA report[11] found physicians lost $4.2 billion in annual revenue providing unreimbursed emergency care; compare that loss in a single field to the $4.7 billion paid in 2008 to resolve all malpractice claims nationwide[see 1]. The same study said emergency physicians incurred an annual average of $138,300 in uncollectable fees, double the average insurance premium for specialists and nine times the average premium for primary care physicians. It seems an ounce of reimbursement is worth a pound of tort reform.

Counter Argument - WhiteCoat

Doctors fear malpractice liability. And why shouldn’t they? Last month a woman was awarded $60 million dollars after a cosmetic surgeon allegedly botched her thigh lift. Medical malpractice law firms proudly display news releases about their multimillion dollar malpractice verdicts against physicians.

Does malpractice liability affect access to medical care, though? Access to medical care is limited by two factors: Available providers and willing providers. The best vascular surgery program in the world can’t help you if there’s no surgeon available or if you’re 150 miles away when your aortic aneurysm ruptures. Similarly, an abundance of nearby neurosurgeons helps no one with a brain hemorrhage if none of those neurosurgeons is willing to perform brain surgery.

What factors affect whether a provider is available or willing to provide services? Money undoubtedly affects access to care. Even though patients with Medicaid ostensibly have a means to pay for their care, they often have difficulty finding a physician to treat them because payments do not cover the costs of providing care. In this case, physicians may be available, but they are unwilling to provide care for the proposed payment. Conversely, patients with commercial insurance don’t seem to have such problems.

Liability also affects access to care. At first glance, it is easy to discount that effect. How could something that amounts to only 1.5% of total healthcare expenditures affect a physician’s willingness to provide care? The answer is that direct liability costs are only a small piece of the puzzle. Fear of liability creates a tremendous ripple effect. No physician wants to be at the receiving end of the next $60 million verdict. Residents in high-risk fields cite malpractice costs as by far the largest reason for leaving one state in favor of another. More than half of hospitals in medical liability crisis states have difficulty recruiting physicians, resulting in less physician coverage for their EDs. A survey of some Nevada Ob/Gyns showed that 60% planned to drop obstetrical coverage due to malpractice premium increases. Similarly, many Mississippi Ob/Gyns have dropped obstetrical care due to malpractice liability, leaving some counties with no obstetrical care at all. Trauma centers in several states have temporarily closed due to malpractice issues.

Texas tort reform shows that liability reduction can increase access to healthcare. Since tort reform was passed in Texas six years ago, the number of applications for physician licenses has increased dramatically. The number of emergency physicians has increased in 76 Texas counties – many of which were considered “underserved” for emergency care before tort reform. The number of malpractice insurers in Texas increased from 4 to more than 30 and insurance premiums dropped more than 40%. One Texas health system was able to spend $100 million extra dollars helping poor patients. That money had previously been held in reserves for legal defense fees and insurance premiums.

Some might try to draw conclusions by comparing metrics on ACEP’s Report Card. Doing so does not take into account multiple other factors affecting each metric. We cannot directly compare better access to higher liability any more than we can directly compare better access to colder climate. After all, states that scored worst in “access to care” were exclusively in the South and West United States – which generally have warmer climates.

Finally, defensive medicine costs our system up to $300 billion each year. Eliminating defensive medicine could provide each one of the 46 million uninsured patients in the US with $6500 in health care. Unfortunately, there is little tolerance for errors or misdiagnosis in medicine. While no lawyer will ever admit an expectation that medical care should be perfect, I still haven’t found a lawyer who will give me an example of a heart attack, a ruptured appendix, or a leaking cerebral aneurysm that it is OK to misdiagnose. Instead, doctors perform one low-yield test after another to “prove” that every haystack really doesn’t have a needle in it.

I respect Max and I respect his opinions. It just seems ironic that some of the strongest supporters of the notion that we can “sue our way to better health care” are those who stand to benefit the most from trying to do so.

 

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Ronald Miller has an excellent post about the timing of interrogatories in personal injury lawsuits.

One of the most effective weapons available to plaintiff's lawyers is the element of surprise. Although defendants typically begin lawsuits with far more information about the facts (and thus a better ability to marshal specific facts in their favor), they do not know what the plaintiff's lawyer knows or believes, and they do not know how the plaintiff's lawyer intends to prove his or her case.

Moreover, in some cases, the defendant's lawyer might not even take the time to learn all the relevant facts. Thus, as Miller notes,

[S]ome [defense] lawyers are going to learn the case when they get the file and get their client ready, regardless of the stage of the case. Others are going to not know the file at all and introduce themselves to the client and the case 10 minutes before the depositions. The theory behind waiting to serve interrogatories is that if you get the latter type of defense attorney, the defendant will take positions that don’t comport with the facts, logic or good strategy because they have not looked at the nuances of the case. Arguably, this logic would even hold up against a top notch lawyer because every lawyer, even well prepared lawyers, sees a case with a clearer lens on the courthouse steps than they do when preparing for a deposition.

No doubt. On the other hand,

The advantage in first obtaining answers to interrogatories is that the answers should help the attorney determine who should be deposed, what questions should be asked of those deponents and what documents should be obtained in the case.

Of course, another highly effective weapon is the truth. Much as how cynics say that you should tell the truth because it is easier to remember, a lawyer will always be able to handle surprise at trial if his or her theory of the case is consistent with the truth. Conversely, a lawyer who presents a theory that is inconsistent with the truth (even if presented in good faith, such as when the lawyer was simply unaware of a particular fact) is exposed to the risk that a "surprise" fact will contradict their theory and take the whole case down with it.

For me, then, when determining how much discovery I want to do prior to a deposition, I consider how much I know about the witness's story and about the truth, and how much more I need to know about the witness's story and the truth. Thus, while I rarely send out comprehensive interrogatories prior to a deposition, I will usually send out enough to know the witness's position with regard to the major issues in the case. Odds are, the defense lawyer will have figured out those issues (and prepared the witness) even if they only picked up the file a few days before the deposition, so it's pointless to blind myself to those facts.

Finally, in my personal experience trickery of any form, even ethical trickery that is entirely within the bounds of professionalism, is a waste of time, and you have more to lose by attempting it than by simply investigating the case thoroughly and proving it in the most clear, concise and compelling manner possible.

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[Apologies for the typo in the title -- unfortunately, I can't change it without damaging all the syndication links to the post. See also update below regarding the "downloading" and "sharing" distinction.]

Green Day's "Minority" is available for $0.99 on Amazon MP3.

Joel Tenenbaum will pay $22,500 for it (a total of $675,000 for 30 songs) because he downloaded and shared it through KaZaA, a peer-to-peer network.

Since Warner Music apparently didn't bother proving any actual damages beyond the $0.99 for Tenenbaum's personal use of the song, we must assume that $21,499.01 of the award is for punitive damages.*

Tenenbaum and other activists have argued such an award is unconstitutional. The issue is "unsettled," but doesn't look good for Tenenbaum: previously, in Eldred and Grokster, the Supreme Court bent over backwards for copyright owners by, respectively, nullifying a clause of the United States Constitution and inventing an entirely new federal common law cause of action for copyright holders.

If the Tenenbaum situation had been reversed -- if Warner Music had ripped off Tenenbaum by fraudulently selling him an MP3 then revoking his access to it, which Warner (through the RIAA) claims they can do -- then there would be no question on the limit of the punitive damages. As the Supreme Court held in State Farm v. Campbell:

Our jurisprudence and the principles it has now established demonstrate, however, that, in practice, few awards exceeding a single-digit ratio between punitive and compensatory damages, to a significant degree, will satisfy due process. In Has lip, in upholding a punitive damages award, we concluded that an award of more than four times the amount of compensatory damages might be close to the line of constitutional impropriety. 499 U. S., at 23-24. We cited that 4-to-1 ratio again in Gore. 517 U. S., at 581. The Court further referenced a long legislative history, dating back over 700 years and going forward to today, providing for sanctions of double, treble, or quadruple damages to deter and punish. Id., at 581, and n. 33. While these ratios are not binding, they are instructive. They demonstrate what should be obvious: Single-digit multipliers are more likely to comport with due process, while still achieving the State's goals of deterrence and retribution, than awards with ratios in range of 500 to 1, id., at 582, or, in this case, of 145 to 1.

(emphasis added)

The unconstitutional 145-to-1 verdict is but a tiny fraction of the 21,716-to-1 awarded against Tenenbaum. Tenenbaum's award is thus a no-brainer under existing due process / constitutional precedent: it's grossly excessive and unreasonable.

The only question is if we have one set of laws for lawsuits against big corporations and another set for lawsuits by big corporations.

* * *

* Footnote: The verdict won't separate "compensatory" from "punitive" damages, it will simply call the whole sum "statutory damages." Unlike every other field of law, federal copyright statutes permit copyright holders to waive "actual damages" in favor of absurdly large "statutory damages" of up to $150,000 per infringement if the infringement was "willful."

But let's be serious: any award over proven actual damages is undoubtedly "punitive." Congress can't just legislate its way around a constitutional right by calling a duck a goose.

[UPDATE: A number of commentators on other sites have drawn distinctions between downloading music and sharing it, pointing out that the latter is the infringement typically at issue.

That's correct, but it's irrelevant here, because the record company elected statutory damages, relieving them of any burden to prove actual damages from the sharing. That's the whole problem: under statutory damages, the record company need only prove "infringement" -- and not the extent or nature of it -- to avail themselves of grossly excessive punitive damages.]

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All's fair in love, war and litigation:

An arbitrator cannot sue a lawyer for wrongful use of civil proceedings, the 3rd U.S. Circuit Court of Appeals has ruled, even if the lawyer allegedly lodged false accusations in court papers to have the arbitrator disqualified, because lawyers enjoy an "absolute privilege" that immunizes them from liability over any communication made in the course of litigation.

The five-page unpublished opinion is available here. It says:

The underlying litigation in this case began in 1995 when Anthony Patterson, a
member of the Church of the Lord Jesus Christ of the Apostolic Faith in Philadelphia, filed an action in state court against church leaders alleging that they had looted millions of dollars from the church’s bank accounts. In November 2006, the parties agreed to submit the case to binding arbitration. The parties selected Edward Naythons (“Naythons”), a retired United States Magistrate Judge in the Eastern District of Pennsylvania, as the neutral arbitrator. . . .

Naythons issued the final adjudication in October 2006, but dated it July 25, 2006,
the date he completed it. In November 2006, Stradley filed a motion to vacate the final arbitration award. In December 2006, Stradley filed a petition for a hearing on their petition to vacate, as well as their previous petition for recusal.

About ten months later, Naythons filed a complaint against Stradley. In it, Naythons alleged abuse of process and wrongful use of civil proceedings due to the “scorched earth” litigation strategy Stradley employed and the accusations Stradley leveled against Naythons in the course of making arguments for his recusal. Stradley moved to dismiss the case because Naythons, a non-party to the underlying litigation, lacked standing.

The Third Circuit agreed in a single paragraph of analysis:

Under Pennsylvania law, the District Court correctly dismissed Naythons’s claims
of abuse of process and wrongful use of civil proceedings. Stradley did not “use legal process” against Naythons. Naythons was the arbitrator in the state proceeding, not a party to the action, and the fact that he was named as a respondent in one of the state court petitions is of no import. Permitting Naythons to sustain either of these claims against Stradley would abrogate the doctrine of judicial privilege, whereby “pertinent and material” communications made in in the context of judicial proceedings are absolutely privileged from civil liability. Moses v. McWilliams, 549 A.2d 950, 956 (Pa. Super. Ct. 1988) (citing Post v. Mendel, 507 A.2d 351, 355 (Pa. 1986)). The proper recourse for any unethical conduct on behalf of Stradley is through judicial review of the arbitration proceedings, which could result in sanctions against Stradley if their conduct was as egregious as Naythons alleged in his complaint.

The claims were obviously a long shot -- an arbitrator isn't a party to the case they hear, so nothing is "used" or "initiated" against them.

Why didn't Naythons allege defamation? 

Ask his lawyer, George Bochetto. Bochetto was the plaintiff in the most recent Pennsylvania Supreme Court opinion on "judicial privilege," Bochetto v. Gibson,  which reaffirmed Post:

 Pursuant to the judicial privilege, a person is entitled to absolute immunity for 'communications which are issued in the regular course of judicial proceedings and which are pertinent and material to the redress or relief sought.' Post v. Mendel, 510 Pa. 213, 507 A.2d 351, 355 (Pa. 1986) (emphasis in original). This privilege is based on the 'public policy which permits all suiters, however bold and wicked, however virtuous and timid, to secure access to the courts of justice to present whatever claims, true or false, real or fictitious, they seek to adjudicate.' Id. As we explained in Post, 'to assure that such claims are justly resolved, it is essential that pertinent issues be aired in a manner that is unfettered by the threat of libel or slander suits being filed.' Id. Notably, this privilege is extended not only to parties so that they are not deterred from using the courts, but also to judges so that they may 'administer the law without fear of consequences,' 'to witnesses to encourage their complete and unintimidated testimony in court, and to counsel to enable him to best represent his client's interests.' Binder v. Triangle Publications, Inc., 442 Pa. 319, 275 A.2d 53, 56 (Pa. 1971).

Bochetto v. Gibson, 580 Pa. 245, 251, 860 A.2d 67, 71 (2004).

The Pennsylvania Supreme Court held the privilege did not apply to the facts alleged by Bochetto, however, as the defendant attorney had faxed a copy of the allegedly defamatory complaint to a reporter (at The Legal Intelligencer). Such faxing was not "in the regular course of judicial proceedings."

The lawyers at Stradley Ronon no doubt paid heed the lesson of Bochetto v. Gibson and kept all their allegations within the confines of the litigation. Hence Naythons' and Bochetto's creativity.

I don't know the merits of the allegations either way. Assuming, for a moment, that Naythons' allegations were true and Stradley injured him through "scorched earth " litigation tactics, the immunity granted to them from suit by Nathons is all the more reason that the district court needs its hands free to deal with lawyers and parties who misbehave, the exact issue pending before the Third Circuit in Grider v. Keystone Health.

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How Appealing points to this Shannon Duffy article in The Legal Intelligencer:

Shockwaves reverberated through the civil defense bar in September 2007 when a federal judge imposed sanctions on several lawyers and their clients for engaging in discovery tactics that the judge said were designed to delay and drive up the costs, but that many lawyers say are nothing more than business as usual. * * *

The case has become a cause among defense lawyers who argue that if the sanctions imposed by U.S. District Judge James Knoll Gardner are not lifted, they will find it difficult to represent their clients properly.

The Philadelphia Bar Association took the rare step of filing an amicus brief in the appeal, saying Gardner's ruling, if upheld, threatens to "increase substantially the cost of civil litigation and to chill the zealous advocacy that is every attorney's duty and the cornerstone of our judicial system." * * *

In his September 2007 decision, Gardner imposed sanctions on attorneys John S. Summers of Hangley Aronchick Segal & Pudlin; Daniel B. Huyett and Jeffrey D. Bukowski of Stevens & Lee; and Sandra A. Girifalco of Stradley Ronon Stevens & Young.

Gardner's blistering 77-page opinion concluded that the lawyers and their clients -- a pair of insurance companies -- had acted in bad faith.

By way of background, as The Legal notes,

The underlying suit was brought by a class of doctors and alleged RICO claims against Capital Blue Cross, Highmark Inc. and their jointly formed HMO, Keystone Health Plan Central. The doctors claimed they were being cheated out of their rightful fees because the insurers "shave" capitation payments to doctors by under-reporting the number of patients enrolled in the doctors' practice groups. ... The suit also accuses the insurers of defrauding doctors by "manipulating" the medical service codes used to calculate reimbursements.

Simple, right? Sure, it's a lot of documents, but they're the defendants' own payment processing documents, so they should be readily accessible.

You can read the District Court opinion here. Let's highlight some of Judge Gardner's findings:

The corporate defendants have repeatedly denied that they have access to the requested information, and have misrepresented the nature of their roles in the claims submission process. Moreover, defense counsel have feigned misunderstanding of words, terms and phrases clearly understood by them and their clients. * * * 

As stated in Finding of Fact 26, on March 1, 2004 Attorney Summers sent a letter to the court attaching a series of Declarations which affirmatively represented to the court that plaintiffs’ allegations of bundling and downcoding lacked any factual basis, and that those claims were “without merit”. Thereafter, defendant Keystone, through its counsel, Attorney Summers, refused to produce the underlying documents and data compilations which supported the Declarations on a number of frequently changing bases. Initially, Attorney Summers withheld the underlying documents and data compilations because they allegedly constituted lay opinion. Next, Attorney Summers withheld the information on the basis that it was expert opinion and immune from discovery. Finally, Attorney Summers asserted
that the underlying information was privileged material pursuant to either the attorney-client privilege or the attorney work product doctrine.

As noted by my colleague Senior United States District Judge J. William Ditter, Jr., “It is not good faith for a lawyer to frustrate discovery requests...with successive objections like a magician pulling another and another and then still another rabbit out of a hat.” Massachusetts School of Law at Andover, Inc. v. American Bar Association, 914 F.Supp. 1172, 1177 (E.D.Pa. 1996). * * * 

The most egregious instance of late production involves Keystone’s late production of claims data. Keystone claimed for years that it was unable to provide claims data. During the same time that Keystone and its counsel were feigning an inability to produce claims data (which it owned according to the ASA agreement with Synertech), Keystone was using claims data for its own self-serving purposes (i.e., the Declarations sent to the court on March 1, 2005). * * *

This case is about claims processing. To deny plaintiffs the data which Keystone owns is equivalent to denying plaintiffs their day in court. Without this data it will be more difficult for plaintiffs to prove their claims. I conclude that this is exactly what defendant Keystone hoped to accomplish by thwarting discovery in this case.

From reading the opinion, it seems the defendants' strategy was two-pronged:

1. Thwart plaintiffs' discovery by repeatedly inventing new excuses for not producing the claims processing data, and,
2. Distract, delay, and overwhelm the court and the plaintiffs by repeatedly interjecting collateral issues through "declarations."

The beauty of this plan is that it rapidly snowballs: once you introduce a new issue through #2, you can then apply #1 to refuse any further discovery into it, complicating and delaying the case further, which is apparently what happened here:

After appointment of Special Discovery Master Blume, the parties spent a period of time productively dealing with discovery issues. Plaintiffs have accepted all the decisions of Special Discovery Master Blume. Defendants initially accepted many of her decisions, but reverted to a systematic routine of not only appealing to me most, if not all, of her substantive decisions, but also filing objections to the Master’s monthly reports which detail the proceedings before her and her impressions of the status of this case. The docket reveals the amount of activity this case has generated by virtue of nearly 850 docket entries since this cases’s inception on November 7, 2001.

The cost and difficulty of discovery, particularly in complex business cases like Grider, is one of the most important issues in American law today. Unfortunately, the institutions that should be offering solutions have failed us, typically preferring to propose heads defendants win, tails plaintiffs lose "reforms" in which defendants have neither an obligation to produce evidence on their own nor an obligation to answer anything but the most specific and limited of requests. See, for example, the American College of Trial Lawyers' Civil Discovery Report, which proposed giving defense lawyers a blank check to file frivolous discovery objections while also eliminating most of the tools available to plaintiffs for compeling production.

The Philadelphia Bar Association stepped into this vacuum by hiring two defense firms to prepare an amicus brief (see the brief here) which seizes upon the above to argue that Judge Gardner's sanctions create a "chilling effect" by forcing attorneys into

... a Hobson's choice: either represent their clients in discovery matters to the limits of zealous advocacy at the risk of incurring potentially draconian sanctions; or fail to assert (or stand by) well-founded objections to arguably overreaching discovery requests, regardless of how onerous the burdens such requests may impose on their clients, for fear of incurring highly punitive sanctions.

The PBA's amicus brief misses the point: the defendants' discovery objections were meritless and designed to frustrate the action. All of the requested discovery was either highly relevant (and accessible) or was interjected into the litigation by defendants themselves.

Just like with claims for abuse of process and wrongful use of civil proceedings, attorneys and parties are not shielded from liability when they use a proper procedure for an improper purpose. Whether the means were justified is a question of what the ends were.

Here, defense counsel used a variety of theoretically appropriate discovery means -- like objections, privilege assertions, declarations, appeals from discovery masters, and motions for reconsideration -- for the illegitimate end of thwarting discovery, overwhelming the court, and delaying the action.

Fact is, discovery is going to continue to be needlessly expensive and time-consuming up until defendants have an affirmative duty to produce relevant information, since the lack of such duty forces plaintiffs to engage in fishing expeditions if they want any information at all.

If plaintiffs can't even get sanctions for intentionally dilatory and obfuscatory conduct, then talk of "reform" is pointless, since the only "reform" on the table would give the keys to the courthouse doors to whichever defense lawyer was most willing to slam them shut.

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[Update II -- Anne Marie Green of CBS3 (KYW) News Philadelphia also spoke with me about case, particularly the relief available to the day camp members. Video available here.

Update -- Jon Elliott on San Diego 1700AM interviewed me on the incident and the law. List of their podcasts here (I'm "7/10/09 2nd Hour, 07/10/09 4:00pm"), direct link to 36MB MP3 here. Best part is when a spaceship lands in the middle of my interview.]

You've probably heard by now about the Valley Swim Club / Creative Steps Day Camp incident, in which a Huntingdon Valley "private" swim club apparently refused to let 65 African-American and Hispanic children who had paid $1950 for a weekly membership swim in the pool.

For a legal introduction, see my post yesterday, Philadelphia Swim Club Refuses Black Children Because Of Their "Complexion." In short, the Pennsylvania Human Relations Act prohibits racial discrimination in "public accommodations" like "swimming pools" unless those entities are "distinctly private." Odds are, the Valley Swim club is not "distinctly private" because the PHRA and the case law imply "distinctly private" applies only to bona fide fraternal organizations that do not let nonmembers use their facilities at all, not the simple paid-your-membership-dues-and-swim system the Valley Swim Club used.

Today let's talk about the upcoming legal procedure, the disputed facts, and the core issues to be resolved.

The Legal Procedure:

Discrimination lawsuits (whether based on race, gender, age, or disability) don't begin like most lawsuits; before filing in court, the victim of discrimination must file a complaint with either the Pennsylvania Human Relations Commission (PHRC) or, if related to employment, the federal Equal Employment Opportunity Commission (EEOC).

Also unlike almost every other field of law, most of which allow plaintiffs one year, two years, or possibly more to file their claim under the 'statute of limitations,' discrimination complaints must be filed within 180 days of the discrimination or they are forever waived. 

Based on a NAACP complaint, the PHRC has already opened an investigation. Typically, these investigations take months, and can take up to a year; by state law, victims of discrimination are prohibited from suing until the investigation is completed or a year from when they filed the complaint, whichever comes first. The PHRC has said they will conduct an "expedited" investigation here.

The PHRC process is flexible and analogous to a police investigation, in that the bulk of the process is not lawyers arguing with one another, but rather a PHRC investigator talking with the complainant, the respondent, and important witnesses. Eventually, the PHRC will either dismiss the case for lack of probable cause (after which a normal lawsuit can be initiated) or:

If probable cause is found in your case, the Commission will attempt to settle the case. The respondent will be asked to stop the discriminatory actions, begin any new programs or make financial payment to settle your case. If this conciliation process is unsuccessful, a public hearing will be held on your case.

At the public hearing, testimony is given under oath and evidence in your case is submitted. If you do not have an attorney, a Commission attorney will represent your complaint. After your case is presented, the Commissioners will vote either to agree that discrimination did occur and approve a settlement, or dismiss the complaint, if they decide discrimination did not occur.

The idea here is similar to small claims court and arbitration of motor vehicle accidents: presumably, if the parties go through the process once and one side clearly loses, this will encourage settlement.

Unfortunately, except where the damages are small, PHRC decisions, like compulsory arbitration decisions, are typically appealed to state court. Unless the Valley Swim Club and the Day Camp can come up with a solution, then, regardless of what the PHRC finds, this case will likely be appealed and litigated in the Montgomery County Court of Common Pleas, since the pool was in Montgomery County.

The Facts That Will Be Disputed:

The core allegations by the plaintiffs are simple: we paid $1950 to swim at a club, got there, heard a number of racist remarks, then, the next day, had our money refunded and told not to come back because of "complexion" and "atmosphere."

The Valley Club has replaced its entire website with:

The Valley Club is deeply troubled by the recent allegations of racism which are completely untrue.

We had originally agreed to invite the camps to use our facility, knowing full well that the children from the camps were from multi-ethnic backgrounds. Unfortunately, we quickly learned that we underestimated the capacity of our facilities and realized that we could not accommodate the number of children from these camps. All funds were returned to the camps and we will re-evaluate the issue at a later date to determine whether it can be feasible in the future.

Our Valley Club deplores discrimination in any form, as is evidenced by our multi-ethnic and diverse membership. Whatever comments may or may not have been made by an individual member is an opinion not shared by The Valley Club Board.

Plausible, but disputed:

HUNTINGDON VALLEY, Pa. - A suburban Philadelphia swim member tells the AP she didn't see inner-city kids misbehaving at a pool they were later barred from.

Amy Goldman said she's been a member of the Valley Club for two years. She said the pool wasn't particularly crowded and the children from Creative Steps daycare were "well behaved and respectful."

She said there had been black members at the club in the past, though she couldn't remember seeing any this year.

We see hints of a "no good deed goes unpunished" defense in the works:

The statement says the day campers were turned away because they overwhelmed the 110,000-gallon pool.

"We quickly learned that we underestimated the capacity of our facilities, and realized that we could not accommodate the number of children from these camps," the statement says.

A worker at another Northeast Philadelphia day camp that had an agreement to use Valley Club this summer, Storybook Children's Center, said she believed the club's account. Monica Scanlon said she took 25 children of diverse ethnicities to its pool this summer, but the noise had clearly been too much for comfort.

Valley Club president John Duesler apologetically refunded Storybook's money, as he did for Creative Steps.

"He was trying to help us out, because there weren't supposed to be city pools open this year," said Scanlon, who contacted The Inquirer after learning of the controversy.

These sorts of factual disputes are precisely why we have courts and juries and why cases take so long.

What Creative Steps Day Camp Has To Prove And What The Valley Swim Club Has To Explain:

This incident is intriguing, legally, because it asks a basic question that hasn't really been raised in more than forty years: what does a complainant have to prove to show they were the victim of racial discrimination?

Do they have to show that race had some effect in excluding them from a public accommodation? That race was the only factor in their exclusion? What happens if the jury finds that race impacted the decision by the Club but that the Club would have refunded the money anyway for other reasons?

These questions have been answered in the employment context, where they come up all the time, but not in the public accommodation context, where there have been few lawsuits alleging racial discrimination for decades.

Based on the minimal Pennsylvania case law out there, I believe the PHRC and any later court would set a fairly low bar. Back in the 1970s, The Pennsylvania Supreme Court recognized "In trying to eradicate other manifestations of racial discrimination, courts, including the Supreme Court of the United States, have recognized that statistics alone can establish racial discrimination. " Pennsylvania Human Relations Comm'n v. Chester Housing Authority, 458 Pa. 67, 80, 327 A.2d 335, 342 (1974).

If statistics alone can prove discrimination, without concrete proof of racial motive or that race was a necessary factor, then odds are the eventual jury that hears this case will only be asked to decide if the Club "den[ied] to any person because of his race" "any of the accommodations, advantages, facilities or privileges of such public accommodation," just as the Human Relations Act says.

So how do we show denial because of their race?

Let's assume, for the moment, that everything the Club said is true. There's still a big unanswered question: once they realized they were overbooked, how did they choose which money to refund?

The most recent members? Did they do that for individual white members, too? What about predominantly white day camps?

On its face, the Storybrook Day Camp story sounds favorable to the Valley Swim Club's position, but upon closer inspection it's another diverse day camp whose money was refunded after they showed up. Like the "statistics" described by the Pennsylvania Supreme Court, the presence of another minority Day Camp which was excluded might be very damaging to the Swim Club's defense, unless they can show similar exclusions / refunds of white camps or members.

But I think they've got an even bigger problem: we're having a debate they obviously did not have when they refunded the money. The concern stated at the time was over "complexion" and "atmosphere."

That's not the same thing as their website says, that they "quickly learned that we underestimated the capacity of our facilities and realized that we could not accommodate the number of children from these camps."

And it gets worse:

Apparently, the way Duesler handled it was to refund Wright's check and tell her that the club membership overthrew his decision "by voting to disinvite us," Wright said.

Well, that's news to Valley Club member Jim Flynn. Standing in front of the club - which was padlocked yesterday - Flynn seethed over the way he said Duesler has handled things.

"To my knowledge, the members were not involved in any of the decisionmaking," says Flynn, 41, a Fox Chase resident who pays a $700 membership for a family of four. "As far as I know, all we recommended was to change the time that [the campers] came, from the afternoons to a nonpeak time. We never recommended to disinvite them."

As for Duesler's "complexion" comment, he said, "I couldn't believe he said that. . . . It was insensitive and inflammatory. Look, I'm not naive enough to think that racism doesn't exist here, but I don't want the good people's names at this club to be smeared."

And that's what will probably sink the Swim Club's defense: they can't get their stories straight. At some point, even the most open-minded juror can tell you're just treading water. 

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When the going gets weird, the weird turn pro.

Here's how it starts:

Nancy Kanter, Esquire ("Kanter") referred a case to Alan B. Epstein, Esquire ("Epstein"). The case involved a claim by a child in the foster system who was abused by her prospective adoptive foster parents (the "Tara M. case"). Kanter had served as a guardian ad litem for the child. When Kanter referred the case to Epstein, he agreed to pay her a referral fee. However, this agreement was not reduced to writing. Subsequently, Epstein joined the firm of Spector Gadon and Rosen, P.C. ("SGR") while he was handling the Tara M. case. Eventually, the Tara M. case was settled for $ 4,310,000. From that amount, Epstein realized attorney's fees of $ 1,293,000. Kanter claimed that she was entitled to a referral fee of $ 431,000. However, Epstein and SGR refused to pay Kanter a referral fee.

Kanter v. Epstein, 2004 PA Super 470, 866 A.2d 394, 395–96 (Pa. Super. Ct. 2004).

Kanter sued and won $215,500 at trial, exactly half what she claimed. The jury then considered, and declined, punitive damages.

Then things got ugly:

On August 16, 2002, counsel for SGR informed the court that she would be taking a pre-paid vacation and requested that the briefing schedule be adjusted to accommodate her vacation. ... Following on-the-record discussions, the trial court summarized the agreement of all parties that the Rule 227.4 deadline [the time at which judgment can be entered and appeals taken] would be extended until March 14, 2003. ...

Despite the fact that they had executed a written agreement and had agreed on the record to extend the Rule 227.4 deadline until March 14, 2003, the Defendants filed a praecipe to enter judgment on January 8, 2003, and judgment was entered that same day.

Why did defendants' counsel jump the gun on their own extension? Who knows. Either way, after filing the judgment, defendants filed two appeals.

Bad idea. The Superior Court later knocked out these first two appeals because:

Accordingly, the judgment entered on January 9, 2003 was improvidently entered as a result of the Defendants' breach of their agreement to extend the Rule 227.4 deadline. As a result, Defendants' appeal of the trial court's December 30, 2002 contempt Order was interlocutory and not appealable at the time that the Defendants filed their appeals at 186 and 187 EDA 2003. Accordingly, the appeals filed at Nos. 186 and 187 EDA 2003 are quashed.

Back at the trial court, after the premature appeal things got uglier:

The trial court ultimately issued an Order dated March 10, 2003, in which the trial court denied the Defendants' post-trial Motions and granted Kanter's post-trial Motion, in part. Essentially, the trial court granted: (1) Kanter's request for additur, increasing the award to $ 431,000; (2) pre-and post-judgment interest; (3) Kanter's request for punitive damages; and (4) Kanter's Motion for sanctions.

Let me fill in the amounts. Interest bumped the compensatory award to $461,429, then punitive damages added another $ 645,000, and then sanctions (for attorney's fees) topped it off with another $124,219.86, bringing Kanter's total to $1,230,648.86, about $60,000 less than the total fee collected by Epstein in the first place.

Defendants appealed that, too.

In the Pennsylvania Superior Court, things got even uglier:

In this case, the trial court ordered the Defendants to file concise statements of the issues to be raised on appeal. However, the Rule 1925(b) Statements filed by the Defendants were anything but concise. SGR's fifteen-page Rule 1925(b) Statement included fifty-five issues that it purportedly sought to raise on appeal and also incorporated by reference the forty-nine issues raised by Epstein in his Rule 1925(b) Statement. Likewise, Epstein filed a fifteen-page Rule 1925(b) Statement that raised the forty- nine issues, and also incorporated by reference the fifty-five issues raised by SGR. 7 In total, the Defendants identified 104 issues in their Rule 1925(b) Statements. Furthermore, we note that many of the issues identified by each of the Defendants also included multiple sub-issues.

Kanter v. Epstein, 2004 PA Super 470, 866 A.2d 394, 400–401 (Pa. Super. Ct. 2004).

The Superior Court dismissed that appeal as well, leaving defendants with nothing. The Pennsylvania Supreme Court and United States Supreme Court both denied certiorari.

So defendants sued their appellate lawyers.

There's an old saying that legal malpractice cases are hard to win because they require the plaintiff prove a "case within the case;" i.e., the plaintiff have to prove they would have won the original case in order to prove the malpractice case.

How do you do that for a bungled appeal? Do you try to convince a jury of non-lawyers what an appellate court would have done with 104 distinct legal issues?

My preferred quote for describing legal malpractice cases is, when the going gets weird, the weird turn pro.

As the Court of Common Pleas for Philadelphia County held last winter:

Whereas, the Kanter action appeal was quashed by the Superior Court of Pennsylvania without reaching a decision on the merits of the appeal;

Whereas, this action is based on the contention the Kanter action appeal was quashed due to the alleged malpractice by defendant, Saul Ewing;

Whereas, the existence of actual loss sustained by plaintiffs to the malpractice by defendant depends on the outcome of the “case within the case” and whether plaintiffs would have received appellate relief and the extent of appellate relief in the Kanter action if plaintiffs’ appeal had not been quashed by the Superior Court;

Whereas, the parties agree that the “case within the case” presents questions of law for the Court to decide and not a jury trial issue;

Whereas, the parties agree to bifurcate the proceedings to present the “case within the case” to the court for decision prior to a trial (if necessary) on the remaining issues for plaintiffs’ malpractice claim and defendant’s counterclaim. …

It is hereby ordered that … the “case within the case” is bifurcated from the other issues in this action and the Court will decide whether and the extent to which plaintiffs would have received appellate relief if their appeals had not been quashed in the Kanter Action … Following the Court’s decision of the “case within the case,” the court will entertain a request for immediate appeal of the decision of the “case within the case” if the decision is not a final order and no party shall oppose the request of another party to immediately appeal the court’s decision of the “case within the case” even if not a final order to resolve the “case within the case” prior to trial of other issues.

Good idea! Three weeks ago, the trial court issued its full order for the inevitable appeal:

A reading of the Trial Judge's Opinion, dated February 26, 2004, reflects his disappointment with the persistently adversarial, over-zealous, and non-cooperative posturing among all trial counsel for more than two years under his jurisdiction, and in his courtroom. As a result, this distinguished jurist may have inadvertently ordered overlapping financial sanctions for punitive damages, additur, Contempt and attorneys fees. An objective review brings a different result. With that in mind, the Superior Court most probably would be constrained to reverse. ...

This Reviewing Court believes that the Superior Court would be unable to find support in this record for the sua sponte alternative. Delaying tactics during trial, including objections and side bar conferences are annoying, but not the sort of wanton or reckless conduct that meet the criteria for a punitive damage award. ...

Ms. Kanter's request for additur was premised on her belief that the triers of fact were required to award her the full amount of her claim. The Superior Court would have reviewed the record and determined that the triers of fact are free to believe all or part or none of the testimony. ...

The Trial Court ordered attorneys fees and contempt as sanctions "relating to punitive damages only" (emphasis in original), however, for all the reasons set forth above finding that conversion and punitive damages should not have been part of this case, the Superior Court would not have remanded the record to the Trial Court for a hearing.

Epstein v. Saul Ewing, LLP, 2009 Phila. Ct. Com. Pl. LEXIS 83 (Pa. C.P. 2009).

And so back they go to the Superior Court, to rule on what it would have done had it considered the original appeal.

The weird have definitely gone pro.

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After four days of trial, and a few hours of deliberations, the AP reports:

A federal jury ruled Thursday that Jammie Thomas-Rasset willfully violated the copyrights on 24 songs, and awarded recording companies $1.92 million, or $80,000 per song.

Thomas-Rasset's second trial actually turned out worse for her. When a different federal jury heard her case in 2007, it hit Thomas-Rasset with a $222,000 judgment.

Under our absurd (and possibly unconstitutional) copyright laws, the award per violation can range from $750 to $150,000, and the jury here roughly split the difference at $80,000 per song, about the same amount as a Manhatten jury will give you for losing the end of your pinky. The jury must have felt these particular duplicate copies of the songs were very dear to the poor record companies.

Why would twelve ordinary citizens do that?

A vigorous defense from Kiwi Camara and Joe Sibley was not enough to sway the jury, which had only to find that a preponderance of the evidence pointed to Thomas-Rasset. The evidence clearly pointed to her machine, even correctly identifying the MAC address of both her cable modem and her computer's Ethernet port. When combined with the facts about her hard drive replacement (and her failure to disclose those facts to the investigators), her "tereastarr" username, and the new theories that she offered yesterday for the first time in more than three years, jurors clearly remained unconvinced by her protestations of innocence.

Camara suspects that the jury thought Thomas-Rasset was a liar and were "angry about it," thus leading to the $80,000 per-song damages.

And there you go. Camara has it right; pity he couldn't get his client to stop lying at trial.

For comparison, not too long ago a jury awarded just $1 million in pain and suffering to this man:

After 63 days in the hospital (57 of them in a coma), 11 surgeries and 65 more days in a rehabilitation hospital, Robert Doviak was left totally and permanently blind, with a sense of touch that was seriously compromised, partial loss of hearing and no sense of smell or taste. Additionally, he had substantial orthopedic injuries including fractures of his left femur, several cervical vertebrae, both zygomatic arches and other bones in and about his face and eyes, his left hand and his right wrist.

The difference?

[D]uring summation, Doviak's attorney asked the jury to award Doviak $60,000,000 for pain and suffering, an amount Doviak's new attorneys say is preposterous and evidence of awful advocacy and which defense counsel says revealed the greed that served as the foundation of plaintiff's case[.]

Credibility matters. Who you are, what you do, and what you say matters. Don't treat the jury like they're stupid; don't try to get anything by them, and don't ask them to do or to believe something ridiculous. It will never work. If your case has a problem, concede it, deal with it, and move on.

And above all, never lie to the jury.

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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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Among the many creative “legal” ideas floating around on the internet is:

If you set up an LLC for yourself and conduct all your business through it, the LLC will be liable in a lawsuit but you won't.

Last week, I was asked if this "asset protection strategy" worked.

No, it doesn't.

Conducting your personal business through an LLC provides no protection against a tort verdict, the type of liability that most people are worried about. The use of corporate forms -- like LLCs, S-Corporations, or Incorporation -- has many important purposes, but avoiding personal tort liability for your own conduct is not one of them.

To see why, let's start with some background.

What's a "tort?"

"Tort" is the Norman word for "wrong." There are three main types of legal wrongs: criminal wrongs, contractual wrongs, and tort wrongs.

A "criminal" wrong is an offense against the state: we as a society made it illegal to smoke pot, you did it anyway, here's your punishment. A "contractual" wrong is a failure to do something you agreed to do: I gave you $20 to mow my lawn, you didn't do it, I want my money back.

Everything else is a "tort" wrong. The most common tort is "negligence," which includes most lawsuits, like car accidents, medical malpractice, or slip and fall. In negligence, you had a general duty to do something in a reasonable way (like drive your car safely) and you messed up, so you have to pay for the harm you caused. Another type of "tort" is an intentional tort, like defamation or tortious interference with business relations: you purposefully hurt me, so you should pay for the damage.

When most people say they're worried about "getting sued," they're usually talking about being responsible a large tort verdict arising from a catastrophic injury or wrongful death.

What's an LLC?

A limited liability company is a type of business association recognized by state and federal governments as a legal entity independent of its owners and employees. On behalf of the owners, the company can, for example, own property and enter into contracts.

For our purposes here, we do not need to go into the differences between a limited liability company, an S-corporation, full incorporation, or a limited partnership. (I exclude general partnership and sole proprietorship because neither claims to limit liability at all.) All of them serve the same basic purpose, which is to protect investors from incurring any liability greater than the amount they invested into the company. The Economist described the purpose of limited liability a couple years ago:

Before limited liability, shareholders risked going bust, even into a debtors’ prison maybe, if their company did. Few would buy shares in a firm unless they knew its managers well and could monitor their activities, especially their borrowing, closely. Now, quite passive investors could afford to risk capital—but only what they chose—with entrepreneurs. This unlocked vast sums previously put in safe investments; it also freed new companies from the burden of fixed-interest debt. The way was open to finance the mounting capital needs of the new railways and factories that were to transform the world.

How does tort liability work in the context of an LLC?

Most everyone knows, although not by name, "vicarious liability" and "the doctrine of respondeat superior." If, in the course and scope of your employment, you cause someone else harm, then your employer is liable for your conduct. 

Here's what you probably don't know:

An agent is subject to liability to a third party harmed by the agent's tortious conduct. Unless an applicable statute provides otherwise, an actor remains subject to liability although the actor acts as an agent or an employee, with actual or apparent authority, or within the scope of employment.

Restatement of the Law, Third, Agency § 7.01 (emphasis added).

(An aside about The Restatement: The Restatement is an intense effort of lawyers, professors and judges organized by the American Law Institute to reduce to writing the legal community's consensus regarding general principles of law applied across the country. "Agency" is the subject of this particular Restatement, and "Third" means it's the third version, which was published in 2006. For reference of how intense these efforts are, the Second version was published in 1958. In case you're wondering, the Second version also said “[a]n agent who does an act otherwise a tort is not relieved from liability by the fact that he acted at the command of the principal or on account of the principal …")

An "agent" is a broader definition of "employee:" it's anyone acting on behalf of the company.

Let me reiterate what that all means: the general legal rule across the country is that individuals acting on behalf of a company are personally liable for their tortious conduct, even if they did so on behalf of the company.

Don't believe this "Restatement?" Want some case law? Here's a case from the Virgin Islands less than a month ago, noting in passing the cases it found with minimal research:

Terr. of the U.S.V.I. v. Goldman, Sachs & Co., 937 A.2d 760, 794 n.153 (Del. Ch. 2007) ('Officers and directors may be held individually liable for personal participation in tortious acts even though performed solely for the benefit of the corporation[.]') (quotation omitted); Armed Forces Ins. Exch. v. Harrison, 2003 UT 14, 70 P.3d 35, 41 (Utah 2003); Miller v. Keyser, 90 S.W.3d 712, 717 (Tex. 2002); Saltiel v. GSI Consultants, Inc., 170 N.J. 297, 788 A.2d 268, 273 (N.J. 2002); Haupt v. Miller, 514 N.W.2d 905, 909 (Iowa 1994); Camacho v. 1440 Rhode Island Ave. Corp., 620 A.2d 242, 246-47 (D.C. 1993); Weir v. McGill, 203 Ga. App. 431, 417 S.E.2d 57, 59 (Ga. 1992); Hecker v. Ravenna Bank, 237 Neb. 810, 468 N.W.2d 88, 95 (Neb. 1991); Ingram v. Machel & Jr. Auto Repair, Inc., 148 A.D.2d 324, 325, 538 N.Y.S.2d 539 (N.Y. App. Div. 1989); Mississippi Printing Co. v. Maris, West & Baker, Inc., 492 So. 2d 977, 978 (Miss. 1986); Wyatt v. Union Mortg. Co., 24 Cal. 3d 773, 157 Cal. Rptr. 392, 598 P.2d 45, 52 (Cal. 1979); Jabczenski v. Southern Pac. Memorial Hosp., 119 Ariz. 15, 579 P.2d 53, 57 (Ariz. Ct. App. 1978); Taylor v. Alston, 79 N.M. 643, 447 P.2d 523, 525 (N.M. Ct. App. 1968); New Eng. Box Co. v. Gilbert, 100 N.H. 257, 123 A.2d 833, 835 (N.H. 1956)."

Addie v. Kjaer, 2009 U.S. Dist. LEXIS 36110, at *21–12 (D.V.I. Apr. 28, 2009)(noting, "The Court has come across no jurisdiction that applies a contrary rule.").

Insurance and employee indemnification are so common today that this distinction is not often appreciated, but it's still the law. If Warren Buffet defrauded Mom and Pop’s Ice Cream Stand wholly for the benefit of Berkshire Hathaway, he would personally be on the hook for the damage just the same as Berkshire.

Let's go back to your personal LLC. Assume you hit a pedestrian with a car, defame someone in a blog post, or cause a building fire. It doesn't matter if you were "employed" by your LLC when you did it -- you will still be personally liable, as will the LLC that "employed" you.

Thus, in order to "protect your assets," you need to put enough money into the LLC that it can completely pay any tort judgment against you, or else the injured person can go for your assets long after it has bankrupted the LLC. That just defeats the nominal purpose of the LLC (to avoid liability), since you'll have to pay the same amount anyway, just through the LLC.

Again, there are plenty of reasons for setting up an LLC, such as protecting investors, limiting contractual liability, limiting liability arising from employee's conduct, and a host of business and tax uses, but avoiding personal liability for your own conduct isn't one of them.

There's an easier and more effective way. Buy good personal liability insurance and buy an umbrella liability insurance policy. If you're running a business, buy a good business insurance policy (including liability) and an umbrella policy for it, too. If your business is unusual, or you're worried about a particular risk, look for risk-specific insurance, like media policies which cover defamation. Don't skimp -- get at least $1 million in coverage, or more depending on your own risks.

Then you'll be covered for most tort verdicts (keep in mind some states prohibit insuring intentional conduct, and insurance policies can carve out whatever exceptions / exemptions they want).

No trickery needed, just some money and foresight.

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New to the site? Haven't been here in a while? Here are some of the most popular posts over the past few weeks.

Litigations and Trials:

• Three Ways To Lose Your Business Lawsuit - Wachtell and The Failed Hexion / Huntsman Merger
• Does The Fumo Juror's Twittering Warrant A Mistrial?
• Harvard Law Professor Bungles Rules of Civil Procedure for Deposing Third Parties
• American College of Trial Lawyers Report Encourages Frivolous Civil Discovery Objections
• Another Preventable Small Business Lawsuit Horror Story

Law Practice:

• How To Write Your Brief So That The Judge Will Hate You
• "How Low Could Associate Salaries Go?" Depends On How Desperate Firms Want To Appear
• Contingent Fee Business Lawyers As Venture Capitalists
• A Great Trial Lawyer, Lucius Seneca, On Keeping Your Law Practice In Perspective
• How To Deal With A "Non-Ruling" By A Trial Judge

Current Events:

• Another Mangled Prescription for Health Courts to Evaluate Medical Malpractice Claims
  
• How AIG Shareholders (Like the US Gov't) Can Sue to Get Back The Bonuses
• "The 'Hot News' Tort and the New Media" -- It's Too Late For Copyright To Sink Blogs
• LinkedIn's Terms of Use: We Own All Content, Ex-Users Agree To Update Our Database Forever 

Recent Court Opinions: 

• Third Circuit Predicts Pennsylvania Supreme Court Would Require Independently Actionable Conduct To Prove Tortious Interference With Contractual Relationships
• Third Circuit Upholds Philadelphia Police's Ban On Headscarves Without A Word On The First Amendment
• E.D.Pa. Threads The Needle On "Gist of the Action" and "Parol Evidence Rule" In Mixed Fraud / Breach of Contract Cases
• Ricci v. DeStefano: The Problem of Granting Certiorari After Summary Judgment

 

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WhiteCoat (and later Walter Olson) directed me to this op-ed in the Pittsburgh Post Gazette by Gerald F. O’Malley, a Philadelphia-based emergency physician:

... Governor Rendell recently declared that Pennsylvania's malpractice lawsuit abuse crisis is over. Nothing could be further from the truth.

Rendell's announcement comes on the heels of the Pennsylvania Supreme Court's annual Malpractice Filings Report, but the court's numbers tell only a part of the story.

The Court reports only the number of cases filed -- not the number of litigants within those cases.

Most cases of alleged medical malpractice include multiple defendants as personal injury lawyers typically sue everyone whose name appears anywhere on the patients' chart.

...

The Court reports a statewide decrease of 41 percent in malpractice filings in 2008 -- but that is comparing the 2008 case filings against a "baseline" of cases filed in 2000-02. The meaningful statistics show 2008's numbers are only a 3 percent decrease from cases filed in 2007. The 3 percent number becomes irrelevant when the multiple litigants within each case are factored in.

You can read the Pennsylvania Supreme Court’s Annual Malpractice Report (PDF) and Governor Rendell’s press release.

Dr. O'Malley's argument is a complete mess.

First, his column references no numbers, figures or data at all, not even to support his primary argument that the number of defendants in medical malpractice cases has increased. I do not even know where he could find such data, as the number of defendants is not recorded by the Supreme Court's medical malpractice statistics.

Second, the number of defendants in a case has little to do with the decisions of the plaintiff’s attorney or the plaintiff. By law, before a patient in Pennsylvania can sue any healthcare provider, their attorney must obtain a certificate of merit from a duly licensed and qualified physician with regard to each defendant; doctors and hospitals can't just be added willy-nilly. 

Just as importantly, as a practical matter, plaintiff's lawyers must add every health care provider who could be responsible -- if they do not, then the defense lawyer for the health care provider most responsible for the harm will inevitably start pointing their fingers at everyone else. In such a situation, the "additional defendant" is in the case by name only, and is dismissed as soon as the "real" defendant is willing to stipulate that they will not point the finger at them.

Third, the number of defendants in Pennsylvania malpractice cases does not play a significant role in increasing or decreasing the insurance premiums paid by doctors and hospitals. Adding a defendant does nothing to increase plaintiff's damages (and thus the size of the settlement or verdict), and it generally makes it harder to prove liability and win the case, because it makes the whole trial more complicated. 

In short, Dr. O’Malley is making an issue out of nothing. Indeed, Dr. O’Malley practically admits as much in his article by not recommending anything that could be done to fix this “problem.” His argument is thus as meaningless as it is baseless.

But let’s talk about some of the facts here.

First, the most comprehensive study done on medical malpractice verdicts by a team of researchers at Harvard Medical School found that three-quarters of all plaintiffs who won had indeed suffered injury to due medical malpractice, and that one-quarter of those plaintiffs who lost had also suffered medical malpractice.

Second, the malpractice filings report shows that more than 80% of plaintiffs in Pennsylvania lose at trial.

Keep those two facts in mind: more than 4 out of 5 plaintiffs lose, and those that do win should win.

Yet, Dr. O’Malley notes:

Since May 2002, when Act 13 was passed requiring physicians to self report when sued for malpractice, more than half of the state's 25,000 doctors have been sued. The Pennsylvania Medical Board, an agency of state government, found that only a fraction of all malpractice cases merit any action which is an indication that rampant medical liability lawsuit abuse exists in Pennsylvania.

I don’t know the polite way to say this: Dr. O’Malley has no idea what he is talking about.

You can read the Pennsylvania Medical Board’s mission statement yourself. The Board “regulates the practice of medical through the licensure, registration and certification of members of the medical profession in the Commonwealth of Pennsylvania.” It has no interest in, and makes no findings with regard to, medical malpractice.

Indeed, the only time the board and medical malpractice liability intersect is when, by way of malpractice, a doctor shows himself to be “an immediate danger to the public health and safety.” You can read some of the recent disciplinary actions here. Other than "immediate danger," the board generally only takes "action" when a doctor, for example, is “convicted of a felony in a federal court” or “failed to report information regarding disciplinary action by a healthcare licensing authority of another state.”

But maybe the Board of Medicine should become more involved in medical malpractice. Here's a critical finding from the most recent National Practitioner Data Bank report:

Physicians with at least two Malpractice Payment Reports were responsible for the majority of Malpractice Payment Reports for physicians: Approximately 33.2 percent of the 146,309 physicians with Malpractice Payment Reports had 2 or more such reports. These 48,566 physicians had a total of 138,199 Malpractice Payment Reports. This was 58.6 percent of the 235,942 Malpractice Payment Reports in the NPDB for physicians.

A few physicians were responsible for a large proportion of malpractice payment dollars paid: The 1 percent of physicians with the largest total payments in the NPDB were responsible for about 11.7 percent of all the money paid for physicians in malpractice judgments or settlements reported to the NPDB. The 5 percent of physicians with the largest total payments in the NPDB were responsible for just under a third (31.4 percent) of the total dollars paid for physicians. Eleven percent (11.6 percent) of physicians with at least one malpractice payment were responsible for half of all malpractice dollars paid from September 1, 1990 through December 31, 2006.

In Pennsylvania, generally half of the payments from the CAT / MCARE fund (which uses taxpayer funds to provide additional malpractice insurance) are made to settle claims against just 2% of doctors.

Fact is, there is a small minority of doctors who are simply terrible at their jobs, just as there are a small number of incompetent lawyers, bank tellers, teachers, cops, engineers, office managers, and every other occupation. In most occupations, though, these people are weeded out over time, but in the distorted marketplace of medical malpractice insurance, the taxpayer foots the bill to keep these bad doctors in practice. That's why physician insurance premiums are so high: to pay for the claims brought against a tiny minority of incompetent doctors who repeatedly injured patients.

Truth is, filings and payouts in medical malpractice in Pennsylvania have declined dramatically, and you have to go back 10 years to find out the last time so little was paid to resolve claims. Malpractice reform is "working" even under the health care providers' and insurance companies' definition: far less is being paid to injured patients than was in the past, even as the population grows.

So how did that happen? We will talk about that in the next post, going into the three major changes made by MCARE: tightening the rules for qualifying experts, restricting the venue in which plaintiffs can file suit and requiring certificates of merit prior to filing suit.

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Elliott Wilcox at the Winning Trial Advocacy Techniques blog has a great post on “non-rulings” by trial judges:

Using a combination of body language, tone, and other non-verbal behaviors, judges subtly encourage lawyers to rephrase questions or move on to new topics. When you’re caught up in the heat of battle, it feels like the judge has issued a ruling, so you rephrase your question or move onto another topic. In reality, no ruling has been issued, because the judge hasn’t ordered you or your opponent to do anything. A common term for describing this type of action is called a “non-ruling.”

The most effective “non-ruling” judges you’ll encounter are often the friendliest judges you’ll encounter in your practice. These judges succeed at “non-ruling” by drawing upon your inner desire to be a consummate professional, while also creating a congenial courtroom attitude. By encouraging both litigators to just “go along and get along,” they can avoid issuing stern rulings (and also avoid a reversal from the appellate bench). Usually, “non-rulings” will be disguised as kindly suggestions, such as, “Why don’t you go ahead and rephrase your question, ok?” Since you don’t want to stir up the pot, you’re usually inclined to go along with the judge’s suggestion.

The post includes several great suggestions for how to respectfully and gracefully deal with these "non-rulings." New and experienced trial lawyers owe it to themselves to read the whole post.

Let me add a distinction. There are two main types of non-rulings: “move along” and “different question.” They warrant different responses.

“Different question” is usually an indication from the judge that they believe the subject matter of your question pertains to relevant and admissible evidence, but that the question itself is objectionable or prejudicial.

In a "different question" circumstance, you probably do not want to prompt a formal ruling from the judge, because the judge will likely sustain the objection yet give you no guidance as to how you should proceed, even if they believe the subject matter is probative and admissible.

The better course here it to stop, think, and find what is wrong with your question. Odds are, you have made a basic mistake like asking a leading or compound question, and by breaking it down and going through the issues step-by-step can avoid any further objections.

“Move along” is usually an indication that the judge believes the subject matter you are inquiring about is inadmissible or prejudicial.

In this circumstance, while you probably should initially attempt to rephrase your question (because the court might have misunderstood where you were going), you are probably going to be overruled no matter what you do.

As such, it makes more sense here to illicit a formal ruling from the judge, because you are going to need it post-trial and on appeal. My preferred response when I hear “move along” is to come up with a different question that will telegraph where I am trying to go to the judge. If the judge again tells me “move along,” then I request a sidebar on the record so that I can (1) determine the scope of what the court is trying to preclude and (2) obtain a formal ruling for purposes of appeal.

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Tim Ferriss, author of The 4-Hour Workweek, has been covering Soticism lately, most recently with a post on Seneca's "On The Shortness Of Life," including this passage:

Vices beset us and surround us on every side, and they do not permit us to rise anew and lift up our eyes for the discernment of truth, but they keep us down when once they have overwhelmed us and we are chained to lust. Their victims are never allowed to return to their true selves; if ever they chance to find some release, like the waters of the deep sea which continue to heave even after the storm is past, they are tossed about, and no rest from their lusts abides.

Think you that I am speaking of the wretches whose evils are admitted? Look at those whose prosperity men flock to behold; they are smothered by their blessings. To how many are riches a burden! From how many do eloquence and the daily straining to display their powers draw forth blood! How many are pale from constant pleasures! To how many does the throng of clients that crowd about them leave no freedom! In short, run through the list of all these men from the lowest to the highest—this man desires an advocate, this one answers the call, that one is on trial, that one defends him, that one gives sentence; no one asserts his claim to himself, everyone is wasted for the sake of another.

Ask about the men whose names are known by heart, and you will see that these are the marks that distinguish them: A cultivates B and B cultivates C; no one is his own master. And then certain men show the most senseless indignation—they complain of the insolence of their superiors, because they were too busy to see them when they wished an audience! But can anyone have the hardihood to complain of the pride of another when he himself has no time to attend to himself?

After all, no matter who you are, the great man does sometimes look toward you even if his face is insolent, he does sometimes condescend to listen to your words, he permits you to appear at his side; but you never deign to look upon yourself, to give ear to yourself. There is no reason, therefore, to count anyone in debt for such services, seeing that, when you performed them, you had no wish for another’s company, but could not endure your own.

What Seneca would think of Above The Law's 2008 survey, in which more than half of ATL's BigLaw associate readers broke 2000 billable hours?

The Attorney Work / Life Balance Calculator shows that, assuming two weeks vacation, eleven holidays, five personal days, a half-hour commute and an unbillable hour a day (lunch, administration, water cooler, etc), then those associates are spending at least the 10.5 best hours of every workday in the office, car, courtroom, or conference room.

Throw in 6.7 hours of sleep every workday, a quarter-hour getting ready before and a quarter-hour decompressing after, a half-hour finding or making dinner, and they're left with, at the most generous, 5.8 tired hours a weekday to themselves, plus the weekends, unless the partner calls them in.

Maybe that's enough. Maybe they like what they do and where they're going, they owe no apologies for that. I like what I do. So do many lawyers.

But life's too short to do anything because you "should."

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Via @walterolson, CQ Politics reported yesterday:

The Senate rejected a bid Thursday to impose new limits on whistleblower awards as it moved toward passage of legislation to beef up the government’s ability to combat financial fraud.

By 31-61, the Senate rejected an amendment by Jon Kyl , R-Ariz., that sought to set a $50 million maximum on the amount that a whistleblower could receive through a False Claims Act lawsuit to recoup taxpayer funds lost to fraud. Currently, awards can reach 30 percent of the total recovered for the federal government, if a judge approves that much.

Kyl said whistleblowers who pinpoint fraud by government contractors and other recipients of taxpayer funds “deserve to be compensated when they save the government money.” But he said the current percentage formula can result in some successful litigants being “grossly overcompensated.”

Senate Judiciary Chairman Patrick J. Leahy , D-Vt., sponsor of the antifraud bill, and Sen. Charles E. Grassley , R-Iowa, author of the 1986 False Claims Act provisions that reward citizens for suing on behalf of taxpayers, opposed Kyl’s effort to cap the awards.

The law, Leahy said, “is very well balanced the way it is, with a judge having to make a final decision on the award. ...I don’t want to fix something that’s not broken.”

Grassley said whistleblower suits under the False Claims Act have recovered $22 billion for the government since 1986.

False Claims Act cases, sometimes known as qui tam (an abbreviation of qui tam pro domino rege quam pro se ipso in hac parte sequitur, meaning "[he] who sues in this matter for the king as [well as] for himself"), are unique and complicated beasts dating back to the 13th century in England. 1986 is when the most recent amendments to the Act were passed.

The cases are initially filed in under seal for review by the U.S. Attorney, who then decides if they want to pursue the action themselves. If they decline, then the whistleblower can proceed as a "relator" of the United States, fighting the action on the government's behalf. There's already a huge backlog of these cases waiting for Department of Justice review, unable to proceed.

I don't blame them for the delay. The cases combine the legal complexity of interpreting federal regulations and procurement contracts with the factual difficulty of proving mens rea in a white collar criminal case, making them difficult and time-consuming just to screen, much less pursue.

The reason whistleblowers and law firms take them -- with extraordinary risk to the whistleblower's career and livelihood, and substantial investments in time and money by the law firm, which usually represents the plaintiff on a contingent fee -- is because they can result in tremendous damages if proven at trial. Under 37 U.S.C. § 3729, anyone proven to have knowingly presented a false claim "is liable to the United States Government for a civil penalty of not less than $5,000 and not more than $10,000 [for each false claim], plus 3 times the amount of damages which the Government sustains because of the act of that person," as well as "costs of a civil action brought to recover any such penalty or damages."

The whistleblower -- assuming they can prove entitlement by, among other elements, being the "original source" of the information -- gets a portion of the recovery, which they then split with the lawyers who represented them on the contingent fee.

The question is: why would anyone want to cap these incentive awards at $50 million?

The vast majority of qui tam / False Claims Act cases don't get anywhere near that. Some recent large settlements have been for $325 million against Northrop Grumman, with the plaintiff / relator receiving $48.7 million, and for $128 million against Network Appliance, with the plaintiff / relator receiving $19.2 million. One of the very few cases in which the award broke $50 million was the $1.4 billion Eli Lilly Zyprexa case, in which the four different plaintiff / relators together received $78,870,877, about 5% of the overall recovery. It's unclear if even that would have hit Senator Kyl's proposed cap, since it was divided among the plaintiffs.

The answer becomes clearer when you talk about massive cases, particularly those in which the government declines to intervene.

Assuming a 40% contingent fee agreement, a $50 million cap results in a $20 million cap on the attorney's fees. Sounds like a lot until you consider that litigation and trial over the meaning of a few documents and involving only half a million pages of documents, 124 trial witnesses, and 80 depositions, can cost $60 million for each side. For the In re Visa Check/Mastermoney Antitrust Litigation, 297 F. Supp. 2d 503 (E.D.N.Y., 2003), had plaintiffs' lawyers been billing by the hour, they would have worked in just the litigation the equivalent of $62,545,603 -- trial would have been extra.

But the plaintiffs' firms weren't billing by the hour -- they took on the risk themselves, much as most False Claims Act firms do. Can you imagine what it would take to actually prove at trial, as the DoJ press release says, "Northrop provided and billed the National Reconnaissance Office (NRO) for defective microelectronic parts, known as Heterojunction Bipolar Transistors (HBTs)?"

What about something bigger? What if there are serious problems with more than just the "Heterojunction Bipolar Transistors" in the $337 billion F-35 joint strike fighter? What if private military contractors in Iraq have been overbilling the more than $100 billion they've received? What about the next Zyprexa fraud?

Such cases would be enormously costly, time-consuming and difficult to pursue, undoubtedly many times larger than the $120-million-in-fees Princeton case and at least as large as the more-than-$120 million Visa antitrust case. Most importantly, such would be exceedingly risky, as the plaintiffs would have to prove "knowing" fraud among millions of documents, thousands of transactions, and hundreds of pages of complicated regulations.

What if the Department of Justice wasn't able to commit the resources to do that? The government can't always get David Boies and his team, eager to promote their new firm, for half price, like they did in the antitrust case against Microsoft.

Keep in mind, the core purpose of qui tam is not only to encourage whistleblowers, but to outsource the heavy lifting of carrying a lawsuit through to recovery. As noted by Justice Scalia, "The FCA can reasonably be regarded as effecting a partial assignment of the Government’s damages claim," critical because "the assignee of a claim has standing to assert the injury in fact suffered by the assignor. " Vermont Agency of Natural Resources v. United States ex. rel. Stevens, 529 U.S. 765 (2000).

An upper limit on recovery of $20 million -- or even, say, $40 million, if we doubled the contingent fee to 80% -- isn't enough to justify pursuing a case of that magnitude, which leaves us, the taxpayer, holding the bag for someone else's fraud on the government.

Senator Kyl has never been a fan of open government. Is there a particular case brewing that he has in mind? 

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 You may have seen this article in The American Lawyer:

Simpson Thacher & Bartlett partner Barry Ostrager isn't exactly mincing words in his assessment of the counsel that guided Chubb Insurance to the U.S. Supreme Court, where on Monday it will square off against Ostrager's insurance company client, Travelers Indemnity. "Whoever has been advising Chubb," he told the Litigation Daily on Friday, on a train en route to Washington, "gave them the worst advice any lawyer ever gave a client." ...

Way back in 1986, Manhattan federal bankruptcy court judge Burton Lifland confirmed the Chapter 11 reorganization plan of the granddaddy of all asbestos companies, Johns-Manville Corp. The plan was groundbreaking. It created a trust, to be funded by Johns-Manville and its insurers, through which all asbestos claims against the company would be processed. ...

Fast-forward to 2001, when asbestos plaintiffs lawyers began testing new theories of liability against insurance companies. They filed tortious interference suits -- which have become known as "direct action" claims -- asserting that insurers had an independent duty to warn potential victims of the dangers of asbestos. In 2002, Travelers asked Judge Lifland -- the Manville bankruptcy judge -- to enjoin the "direct action" cases. ...

At this point, Chubb became involved. Chubb hadn't been part of the Manville deal but it was worried that if Judge Lifland approved the Travelers settlement, it would be precluded from suing Travelers in cases in which they shared liability. Chubb aligned with the asbestos plaintiffs lawyers to challenge the bankruptcy court's power to enjoin suits against parties other than the debtor. (That's the decision that Ostrager has scorned.)

That bothered Stephen Cozen enough that he wrote a letter to The American Lawyer, deriding Ostranger as a "noncredible source ... launching ad hominem attacks."

The irresistible part is that this feud involves none other than the In re Johns Manville Corp. constellation of cases, including 06-2320 (2nd Cir., Jan. 17, 2007), in which Mr. Ostrager's cross-appeal was rejected because:

Travelers had 14 days to file its notice of cross-appeal. However, the firm calculated the 14 days from the date it received the notice, not from the date the notice was actually filed. The district court denied Traveler’s motion to extend the deadline by one day, explaining that this was a case of “garden variety attorney inattention” and not excusable neglect. The Second Circuit affirms.

Doh! But let's focus on the supposed worst advice ever.

The Travelers / Simpson argument is that Chubb / Cozen should have kept their mouths shut and not attempted to intervene, because the arguments they made (or the precedent created) in support of intervention could be used by plaintiffs attempting to sue Chubb in a later "direct action" case involving an asbestos trust.

There is something to be said for not putting forth your best argument in a particular case as part of a broader strategy involving other cases. That something is: you should not sandbag your own arguments in one case unless there is clear and convincing evidence that it will help you in other cases.

The law of unintended consequences applies to the practice of law just as it applies to everything else. What, exactly, did Travelers / Simpson believe would happen in the absence of the Chubb / Cozen intervention? That the billion-dollar asbestos plaintiffs lawyers industry would not realize a bankruptcy court's injunction protecting a non-debtor raised serious statutory and constitutional concerns?

We already know exactly the opposite is true, and that the asbestos plaintiffs lawyers were already challenging the power of the court to enjoin the "direct action" cases against insurance companies. These issues were already destined for the Circuit Courts and the Supreme Court. The difference was the names on the briefs.

Where then would that have left Chubb if Cozen had told them to sit on their rights and not intervene? Had the Supreme Court denied certiorari for the appeal, or if the Supreme Court agrees with the Second Circuit in prohibiting the bankruptcy court from enjoining these suits, then Chubb would have been left out in the cold, potentially precluded from raising issues relating to hundreds of millions of dollars in insurance coverage and tort liability.

Could that be in the running for the worst advice a lawyer ever gave a client?

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The WSJ Law Blog points us to an Op-Ed in the NYTimes:

Restoring a foundation of trust requires a new system of medical justice. Medical cases are now decided jury by jury, without consistent application of medical standards. According to a 2006 study in the New England Journal of Medicine, around 25 percent of cases where there was no identifiable error resulted in malpractice payments. Nor is the system effective for injured patients — according to the same study, 54 cents of every dollar paid in malpractice cases goes to administrative expenses like lawyers, experts and courts.

America needs special health courts aimed not at stopping lawsuits but at delivering fair and reliable decisions. A special court would provide expedited proceedings with knowledgeable staff that would work to settle claims quickly. Trials would be conducted before a judge who is advised by a neutral expert, with written rulings on standards of care.

With a special health court, damages would consist of all lost income and medical costs, plus “pain and suffering” based on a set schedule depending on the severity of the injury. All information about each incident, including details learned in settlements, would be compiled and disseminated so that doctors and hospitals could learn from their errors. Proponents of special health courts have estimated that the total cost of such a new liability system would be about the same as the existing system — less than 2 percent of America’s total health care costs. One benefit would be that the quicker, streamlined system would compensate far more people, with drastically lower legal costs. Most important, it would restore faith in the reliability of medical justice.

The author is none other than Philip Howard, whose latest screed, Life Without Lawyers, cautioned Americans against the devastating effect warning labels have had on our quality of life.

His column is loaded with unsupported references to standard boogeymen like defensive medicine, but let's just focus on the special health courts. Though described in bombastic terms, Howard's proposed system is different in only three respects:

1. the jury is removed and medical malpractice becomes a bench trial before judges;
2. independent experts are (apparently) removed and replaced by a single "neutral" expert chosen by an unspecific procedure; and,
3. the judge is limited in the damages they can award to "lost income and medical costs, plus 'pain and suffering' based on a set schedule depending on the severity of the injury."

I do not see how the first and second part would "free[] doctors from worries about unnecessary and unreasonable malpractice claims." I have known many judges who have presided over many medical malpractice cases, but I have never heard a judge say they felt they personally had the expertise to evaluate whether the standard of care was breached or not any better than a jury. In fact, I have frequently heard the opposite.

Bearing that in mind, would such a system result in more "reliable" malpractice results than our current jury system?

Let's go back to that "2006 study in the New England Journal of Medicine" Howard references, which was unveiled to the public through a press release from the researchers titled "Study Casts Doubt on Claims That the Medical Malpractice System Is Plagued By Frivolous Lawsuits." Here's what they found:

The researchers analyzed past malpractice claims to judge the volume of meritless lawsuits and determine their outcomes. Their findings suggest that portraits of a malpractice system riddled with frivolous lawsuits are overblown. Although nearly one third of claims lacked clear-cut evidence of medical error, most of these suits did not receive compensation. In fact, the number of meritorious claims that did not get paid was actually larger than the group of meritless claims that were paid. The findings appear in the May 11, 2006 issue of The New England Journal of Medicine.

“Some critics have suggested that the malpractice system is inundated with groundless lawsuits, and that whether a plaintiff recovers money is like a random ‘lottery,’ virtually unrelated to whether the claim has merit,” said lead author David Studdert, associate professor of law and public health at HSPH. “These findings cast doubt on that view by showing that most malpractice claims involve medical error and serious injury, and that claims with merit are far more likely to be paid than claims without merit.”

...

Most claims (72%) that did not involve error did not receive compensation. When they did, the payments were lower, on average, than payments for claims that did involve error ($313,205 vs. $521,560). Among claims that involved error, 73% received compensation. “Overall, the malpractice system appears to be getting it right about three quarters of the time,” said Studdert. “That’s far from a perfect record, but it’s not bad, especially considering that questions of error and negligence can be complex.” The 27% of cases with outcomes that didn’t match their merit included claims that went unpaid even though the injury was caused by an error (16%); claims that were paid but did not involve error (10%); and claims that were paid but did not appear to involve a treatment-related injury (0.4%).

So our current system gets it right "three quarters of the time," and, when it gets it wrong, favors the doctors -- would Howard's system beat that?

Probably not; such a system is unlikely to make results any more "reliable" than now, unless you presume that judges are systematically biased in favor of one side or the other. The judges in Howard's proposal -- none of whom have particular expertise in medicine -- will be wholly dependent upon the "neutral expert" for their understanding of the medicine. Worse, unlike the jury in a medical malpractice action today, they will not have the benefit of seeing a cross examination or in considering the views of multiple experts. 

Ironically, Howard's process for chosing a "neutral" expert and the materials they opine on will probably make medical malpractice litigation more contentious, expensive, and uncertain because it will at best resemble the Markman process used in evaluating patent disputes. Markman hearings often involve the selection of a "neutral expert" in helping the judge determine the meaning of a patent, a process loathed by patent attorneys for adding "a whole new level of lawyering, cost, delay and, some say, uncertainty to patent litigation." So there goes parts 1 and 2.

That leaves Howard with a single proposal: limiting damages, for which he proposes a system like workers' compensation, which covers economic losses and provides a pre-set amount for particular damages. [We'll put aside for this post the fact that, as a practical matter, medical malpractice cases are already typically limited by the size of the defendant's insurance policy;  very rarely do plaintiffs ever collect or even attempt to collect amounts over that.]

The problem here is that workers' compensation is, and always has been, construed as a bargain: in exchange for reliable compensation, the workers give up their right to a jury trial on damages. But Howard doesn't propose any quid to go along with his quo -- patients are just supposed to give up their rights to damages without receiving any increased certainty in their compensation if they are injured.

If Howard really wanted to create "fair and reliable" results, he'd propose something along the lines of the National Vaccine Injury Compensation Program, which, inter alia, provides compensation for the plaintiff's attorneys even if a meritorious suit does not prevail, thereby ensuring no one is left behind by the process.

But that's not what Howard really wants.

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You can't click two links on a law practice website these days without getting a good dose of how important it is that lawyers get up to speed with social media. Kevin O'Keefe, head of LexBlog (which hosts this site), suggests focusing on the big three: blogs, Twitter, and LinkedIn.

I got my blog. I got my Twitter.

LinkedIn?

Here's how Gina Rubel, as part of her extensive "Social Media for Lawyers" series at The Legal Intelligencer's blog, described LinkedIn:

Linkedin is one of the oldest and most established professional networking sites on the Web. ... Linkedin is conservative, professional, adheres to a strict set of rules, business-oriented, highly visible in search engines and an easy point of entry for lawyers. For the most part, it serves as an online curriculum vitae (C.V.) or resume which can be linked to your firm’s Web site.

True. It's also true that LinkedIn treats users with same respect in drafting its terms of service that consumers have come to expect from used car dealers, credit card companies, and subprime lenders.

Read their User Agreement:

1.  Your Obligations — What You Must Do

License and warrant your submissions: You do not have to submit anything to us, but if you choose to submit something (including any User generated content, ideas, concepts, techniques and data), you must grant, and you actually grant by concluding this Agreement, a nonexclusive, irrevocable, worldwide, perpetual, unlimited, assignable, sublicenseable, fully paid up and royaltyfree right to us to copy, prepare derivative works of, improve, distribute, publish, remove, retain, add, and use and commercialize, in any way now known or in the future discovered, anything that you submit to us, without any further consent, notice and/or compensation to you or to any third parties. By submitting any information to us, you represent and warrant that such submission is accurate, is not confidential, and is not in violation of any contractual restrictions or other third party rights. You further agree to inform LinkedIn in the event that any such information has changed since your registration with LinkedIn and, if appropriate, you agree to make such modifications yourself to your profile.

It's just as bad as Facebook's hated and rescinded Terms of Use, which claimed to own all of your content forever, with an added bonus in the last two sentences: you agree that everything you submitted is accurate and you agree to keep LinkedIn's information up-to-date.

Got that? Apparently most people don't; I found only one blog post on the subject, a month ago at Web.Tech.Law. Technorati says no one has linked to it. I found one link on a "social media roundup."

That needs to change.

LinkedIn is building its Web 2.0 Yellow Pages, and by ever submitting anything -- like your name, address, place of business, connections, recommendations and content like forum posts -- you agree to let LinkedIn use it forever and that you will take the initiative to update all of it if any of it ever changes.

But what if I terminate my account?

You granted them an "irrevocable" and "perpetual" license to all content and information you ever submit to the site, and imposed a duty on yourself to keep that content and information accurate and current, so what makes you think it could really be a "revocable" or "limited duration" license?

Before you turn those wheels, note that their User Agreement details exactly what happens when you terminate:

7.  Consequences of Termination

Upon termination, you lose access to LinkedIn. The terms of this Agreement shall survive any termination, except Sections 2 and 3 hereof.

The perpetual duty for users to supply accurate and current information for LinkedIn's business is in Section 1. It "survives."

What gets terminated? Section 2, "Your Rights — What You May Do" and Section 3, "Our Rights and Obligations — What We Must And May Do." Termination ends only "Your Rights" and Their "Obligations."

Will LinkedIn ever exercise these rights in an adversarial fashion? 

Probably not. Like I wrote yesterday, "A right with a remedy worse than the harm is not a right anyone will enforce." Trying to enforce these rights would likely cause a mass exodus from the platform.

But that's just theory, contradicted by the plain meaning of the words in the agreement. Moreover, all bets are off if the company goes into distress. Regardless, the core question remains: if LinkedIn doesn't plan on compelling users to keep its professional database accurate and current or to use its users' content commercial without permission, then why does it need these terms?

Ask a used car dealer.

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At The National Law Journal (via How Appealing):

In a case stemming from an employer's theft of e-mails from the personal account of an employee who had sued him for sexual harassment, a panel of the 4th U.S. Circuit Court of Appeals recently became the first circuit to hold that plaintiffs must prove actual damages in order to be eligible for an award of statutory damages under the federal Stored Communications Act.

But the unanimous panel, led by Chief Judge Karen Williams, also ruled that a showing of actual damages is not required for awards of punitive damages or attorney fees. Van Alstyne v. Electronic Scriptorium Ltd., No. 07-1892.

The panel decision reversed a jury award of $150,000 against Bonnie Van Alstyne's employer, Edward Leonard, and $25,000 against Electronic Scriptorium Ltd., of which Leonard was president. The decision leaves intact a $75,000 punitive damages award against Leonard; a $25,000 punitive damages award against ESL; and an award of $135,723.56 in attorney fees and costs to Van Alstyne.

I don't think most non-lawyers recognize they can recover for conduct like this:

During discovery in ESL's suit, Van Alstyne became suspicious that several e-mails presented by Leonard were from her personal account. In a deposition, he admitted he had accessed Van Alstyne's AOL account after she left the company ...

Let's look a little closer at the law, as explained in the opinion (PDF):

Section 2701 of the SCA creates a criminal offense for whoever "intentionally accesses without authorization a facility through which an electronic communication service is provided" or "intentionally exceeds an authorization to access that facility," and by doing so "obtains, alters, or prevents authorized access to a wire or electronic communication while it is in electronic storage in such system." 18 U.S.C.A.
§ 2701(a)(1-2).

Section 2707 provides a private cause of action for "any . . . other person aggrieved" by a violation of § 2701. 18 U.S.C.A. § 2707(a). Under § 2707, a district court may award equitable or declaratory relief, a reasonable attorney’s fee and other costs, and "damages under subsection (c)." 18 U.S.C.A. § 2707(b). Subsection (c) provides:

The court may assess as damages in a civil action under this section the sum of the actual damages suffered by the plaintiff and any profits made by the violator as a result of the violation, but in no case shall a person entitled to recover receive less than the sum of $1,000. If the violation is willful or intentional, the court may assess punitive damages. In the case of a successful action to enforce liability under this section, the court may assess the costs of the action, together with reasonable attorney fees determined by the court.

Id. § 2707(c).

In the face of the plain meaning of the statute, why was the "actual damages" limitation even contested on appeal?

Likely because the defendant argued that, without actual damages, the plaintiff couldn't recover at all. Not punitive damages, not attorney's fees, not anything. The Court disposed of that summarily:

Although "[t]here is no established federal common law rule that precludes the award of punitive damages in the absence of an award of compensatory damages," People Helpers Found., Inc. v. City of Richmond, 12 F.3d 1321, 1326 (4th Cir. 1993), we have held, in accordance with "the majority rule" that, absent statutory language to the contrary, punitive damages are not recoverable absent proof of actual damage, id. at 1327.

The SCA, we believe, provides such language. Section 2707(c) states, "[i]f the violation [of the SCA] is willful or intentional, the court may assess punitive damages." 18 U.S.C.A. § 2707(c). This sentence lacks the limiting language associated with an award of actual damages and statutory damages, with no references to persons "entitled to recover." The sole limitation is that the violation of the SCA be "willful or intentional," a threshold which the jury found to be met in this case.

Accordingly, we find no error in the district court’s award of punitive damages absent a showing of actual damages. See Saunders, 526 F.3d at 152-155 (approving award of punitive damages under the Fair Credit Reporting Act without award of actual damages); Yohay v. City of Alexandria Employees Credit Union, Inc., 827 F.2d 967, 972 (4th Cir. 1987) (noting "[a]ctual damages are not a statutory prerequisite to an award of punitive damages under the [Fair Credit Reporting Act]"). We must vacate and remand this award, however, for the district court to reevaluate in light of our ruling above that Van Alstyne was not entitled to statutory damages in this case absent proof of actual damages.

So there you go.

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Fresh off the presses is Acumed LLC v. Advanced Surgical Servs., 2009 U.S. App. LEXIS 5854 (3d Cir., March 20, 2009), a charming setup in the insanely hostile and competitive world of medical devices:

Acumed is a manufacturer of surgical implants and related devices, and appellant [Morris] and [Advanced Surgical Services] are in the business of distributing surgical implants and other medical devices for various manufacturers, including Acumed, to hospitals and surgeons. ... At the trial, Ryan Crognale, a sales representative for appellant, explained his view of the events that Casey described at Nazareth Hospital. Crognale testified that Morris directed him to deliver the implants to Nazareth and to attend the surgery. He then stated that after his earlier delivery of Acumed implants, he returned to the hospital and saw Casey in the operating room and observed that the physician doing the procedure was "not using my stuff anyway." Consequently, Crognale took the tray of instruments he previously had delivered and left the operating room. Thus, it appears that the physician performing the procedure used materials Acumed supplied through Surgical, its authorized representative.

As Crognale was leaving the surgery center, he encountered Casey, and an argument between the two representatives ensued. Appellant contends that during the argument Casey loudly accused Crognale of illegally selling Acumed inventory, an incident that appellant contends led Dr. Robert Frederick, a doctor at Nazareth, to stop doing business with it. Moreover, appellant contends that because of Dr. Frederick's connection with a large group of physicians in Philadelphia, the confrontation was a factor in a decision by Jefferson Hospital in Philadelphia to exclude Morris from its operating theater for one year. As a result of the incident at Nazareth Hospital, Acumed sent another notice to its customers stating that Surgical was its only authorized representative in eastern Pennsylvania and southern New Jersey.

Can you guess what happened next?

Appellees filed the complaint in this action against appellant in the District Court charging it with violation of the Lanham Act, 15 U.S.C. § 1125, violation of Pennsylvania's Anti-Dilution statute, 54 Pa. Cons. Stat. Ann. § 1124 (West 1996), unfair competition, breach of a non-disclosure provision in the Advanced-Acumed Agreement, conversion, unjust enrichment, and tortious interference with existing or prospective contractual relationships.

...

Appellant filed a four-count counterclaim against appellees. In counts I, II, and III appellant charged that Acumed breached its contract with appellant by not providing timely notice of termination of their relationship and by failing to pay the contractually required buy-out fee that became due to appellant when Acumed terminated their relationship. In addition, appellant charged that Acumed's failure to pay the buy-out fee violated the Pennsylvania Commissioned Sales Representatives statute, 43 P.S. §§ 1471 et seq. (West 1991). In count IV ("counterclaim IV") appellant alleged that Acumed and Surgical ". . .converted property belonging to Advanced, defamed and disparaged Advanced maliciously and falsely, intentionally interfered with Advanced's contractual and business relationships and competed unfairly against Advanced."

After a little more than a week of trial...

The jury returned a verdict on March 21, 2007, finding for appellees on their count against appellant for tortious interference with existing or prospective contractual relationships with appellees' customers. The jury, however, rejected appellees' claim that appellant had tortiously interfered with Acumed's and Surgical's contractual relationship between themselves and also rejected appellees' other claims, including appellees' Lanham Act claims. The jury also found against appellant on the portions of its counterclaims that had survived the District Court's dismissals, i.e., the claims predicated on breach of contract and violation of the Pennsylvania Commissioned Sales Representatives statute. The jury awarded $ 20,000 in compensatory damages to Surgical and $ 0 in compensatory damages to Acumed on the tortious interference claim but found that both Acumed and Surgical were entitled to punitive damages. ... The jury then returned a verdict awarding $ 1 in nominal damages to Acumed and punitive damages to both Acumed and Surgical Resources in the amount of $ 100,000 each.

Uh oh.

As we indicated above, to recover on a tortious intentional interference with existing or prospective contractual relationships claim in Pennsylvania, a plaintiff must prove that the defendant was not privileged or justified in interfering with its contracts: "While some jurisdictions consider a justification for a defendant's interference to be an affirmative defense, Pennsylvania courts require the plaintiff, as part of his prima facie case, to show that the defendant's conduct was not justified." Triffin v. Janssen, 426 Pa. Super. 57, 626 A.2d 571, 574 n.3 (Pa. Super. Ct. 1993) (citing Thompson Coal 412 A.2d at 471 n.7); Silver v. Mendel, 894 F.2d 598, 602 n.6 (3d Cir. 1990). We hasten to add, however, that our conclusion does not depend on the allocation of the burden of proof on the privilege issue, as we would reach our result even if appellant had the burden of proof to establish the privilege as a defense, because the evidence established conclusively that appellant did so.

Pennsylvania has adopted section 768 of the Restatement (Second) of Torts, which recognizes that competitors, in certain circumstances, are privileged in the course of competition to interfere with others' prospective contractual relationships. See Gilbert v. Otterson, 379 Pa. Super. 481, 550 A.2d 550, 554 (Pa. Super. Ct. 1988). The law necessarily recognizes this privilege because if more than one party seeks to sell similar products to prospective purchasers, both necessarily are interfering with the other's attempt to do the same thing. Moreover, even if an entity has an existing contractual relationship with another entity, a stranger to the relationship must be privileged to seek to replace one of the entities lest competition be stifled. Thus, under section 768: "[o]ne who intentionally causes a third person not to enter into a prospective contractual relation with another who is his competitor or not to continue an existing contract terminable at will does not interfere improperly with the other's relation if: (a) the relation concerns [*37] a matter involved in the competition between the actor and the other; (b) the actor does not employ wrongful means; (c) his action does not create or continue an unlawful restraint of trade; and (d) his purpose is at least in part to advance his interest in competing with the other."

...

Comment e to section 768 elaborates on the type of conduct that constitutes wrongful means: "If the actor employs wrongful means, he is not justified under the rule stated in this Section. The predatory means discussed in § 767, Comment c, physical violence, fraud, civil suits and criminal prosecutions, are all wrongful in the situation covered by this Section." Courts relying on comment e have interpreted the wrongful means element to require that a plaintiff, to be successful in a tortious interference action, demonstrate that a defendant engaged in conduct that was actionable on a basis independent of the interference claim. See Brokerage Concepts, 140 F.3d at 531 (citing DP-Tek, Inc. v. A T & T Global Info. Solutions Co., 100 F.3d 828, 833-35 (10th Cir. 1996)). Moreover, we noted in 2000 that even though the Pennsylvania courts have not interpreted the "wrongful means" element of section 768, it is likely that the Pennsylvania Supreme Court would adopt this meaning, that is, for conduct to be wrongful it must be actionable for a reason independent from the claim of tortious interference itself. See Nat'l Data Payment Sys., Inc. v. Meridian Bank, 212 F.3d 849, 858 (3d Cir. 2000); see also CGB Occupational Therapy, Inc. v. RHA Health Servs. Inc., 357 F.3d 375, 389 (3d Cir. 2004). Nothing in later Pennsylvania Supreme Court decisions to which the parties have directed our attention or of which we are aware leads us to change our view of this issue.

I'm sure you can imagine what happened next.

We therefore will reverse the District Court's order of May 21, 2007, to the extent that it denied appellant a judgment as a matter of law on the tortious interference claim, and will remand the case to the District Court for it to enter judgment as a matter of law in favor of appellant on that claim and to set aside the prior judgment on the claim. As a result, we also will reverse the jury's award of compensatory and punitive damages against appellant and the District Court's grant of an injunction in appellees' favor.

That's why business contingent fee cases demand such a high fee and why commercial litigators have to be so selective in the cases they take. On the most basic level, appellees won in the District Court and at trial and post-trial after years of complicated, intense litigation and trial.

How complicated? The Third Circuit Court of Appeal's opinion is a whopping 18,785 words, about one-fifth the length of a typical paperback novel. The briefs from the complaint to the appeal no doubt exceeded 100,000 words.

And the plaintiffs walked away with nothing.

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Twitter, twitter, everywhere. My delicious morning coffee was interrupted this morning by Anne Reed, who tweeted the following on Twitter:

Another tweeting juror, in Philly Fumo trial; How Appealing posts copy of "motion for immediate voir dire", http://tinyurl.com/c74h6s

Apparently the blogging gods want to be kind to your gentle host, ensuring him an endless fountain of inspiration. The Philadelphia Inquirer summarizes:

Defense lawyers for former State Sen. Vincent J. Fumo moved late yesterday for an immediate halt in jury deliberations and the removal of one juror, contending that the juror posted oblique remarks on Facebook.com and Twitter.com - including one declaring, "Stay tuned for a big announcement on Monday everyone!"

The petition, filed on the eve of the scheduled sixth day of deliberations in Fumo's federal corruption trial, stated that there was "substantial evidence" that the juror, who was not identified, had violated admonitions not to disclose the status of deliberations.

The lawyers asked U.S. District Judge Ronald L. Buckwalter to question the juror and other members of the panel.

"An immediate suspension of deliberations and a delicate but probing judicial inquiry is warranted," lawyers NiaLena Caravasos and Peter Goldberger stated in the petition. "Depending on the results of that inquiry, it seems that one or more jurors ought to be removed and possibly replaced . . . or that a mistrial will be required."

The motion cites one case, United States v. Kemp, 500 F.3d 257, 301 (3d Cir. 2007). Here's the relevant passage:

"We review 'a trial court's response to allegations of juror misconduct for abuse of discretion.' United States v. Boone, 458 F.3d 321, 326 (3d Cir. 2006). Here, we conclude that the District Court acted within its discretion when it individually questioned the jurors.

We have recently had occasion to set forth the applicable legal standard governing the district courts' latitude to question jurors during deliberations about allegations of misconduct. In Boone, we recognized that '[i]t is beyond question that the secrecy of deliberations is critical to the success of the jury system.' Id. at 329. At the same time, we emphasized that '[i]t is also manifest, however, that a juror who refuses to deliberate or who commits jury nullification violates the sworn jury oath and prevents the jury from fulfilling its constitutional role.' Id. Attempting to reconcile these disparate values, we held that 'where substantial evidence of jury misconduct -- including credible allegations of jury nullification or of a refusal to deliberate -- arises during deliberations, a district court may, within its sound discretion, investigate the allegations through juror questioning or other appropriate means.' Id. We stressed that a district court, 'based on its unique perspective at the scene, is in a far superior position than this Court to appropriately consider allegations of juror misconduct, both during trial and during deliberations.' Id.

...

Accordingly, the legal standard is clear: a district court may investigate allegations of juror misconduct when presented with 'substantial evidence' of that misconduct.

In other words, while the District Court has ample discretion in deciding whether or not to question a juror, the Court can't just do so on a whim -- it needs "substantial evidence" of juror misconduct.

Here, however,the situation is a little different: while particular tweets (say, "he's guilty as sin, ain't nothin' gonna change my mind") might provide "substantial evidence" of "jury nullification" or "a refusal to deliberate," twittering alone isn't necessarily "substantial evidence" itself of any particular misconduct.

Sure, the jury is instructed to keep the content of deliberations secret, but it doesn't seem the juror revealed any content, other than the cryptic reference to a "big announcement" on Monday, which itself doesn't reveal any content other than the jury being close to a resolution.

Moreover, there's the bigger question of: so what? The Third Circuit still hasn't settled on a standard for removing a juror. Suffice to say it's not easy:

"While it is undisputed that in certain circumstances, district courts may discharge a juror for cause during deliberations, see Fed. R. Crim. P. 23(b), we have yet to enunciate the appropriate standard. 24 Any standard must accommodate two clashing interests. First, it is clear that 'a court may not dismiss a juror during deliberations if the request for discharge stems from doubts the juror harbors about the sufficiency of the government's evidence.' United States v. Brown, 262 U.S. App. D.C. 183, 823 F.2d 591, 596 (D.C. Cir. 1987). Any other rule would eviscerate the right to a unanimous verdict of guilt. See id. On the other hand, courts agree that a district court has the authority to dismiss a juror -- even during deliberations -- if 'that juror refuses to apply the law or to follow the court's instructions.' United States v. Abbell, 271 F.3d 1286, 1302 (11th Cir. 2001) (per curiam). That is because 'a juror who refuses to deliberate or who commits jury nullification violates the sworn jury oath and prevents the jury from fulfilling its constitutional role.' Boone, 458 F.3d at 329. While the jurisprudence discussing the discharge of jurors during deliberations has largely focused on a refusal to deliberate or jury nullification, its reasoning applies with equal force to claims of juror bias." United States v. Kemp, 500 F.3d 257, 303 (3d Cir. 2007).

Id. at 303.

Twittering a couple lines about the status of the trial doesn't come close to "refusing to apply the law." At the most, the juror arguably didn't "follow the court's instruction" with regard to secrecy, but it's hard to say such was deliberate when the juror plainly made an effort not to disclose any specific information.

It all comes back to a discussion I had with Anne Reed just last week (on Twitter, about another juror twittering case, of course):

annereed: Civil defendant wants new trial after finding juror's trial tweets; they look appropriate to me. http://ping.fm/OvHlM

phillyshortcite: @annereed re http://ping.fm/OvHlM Agreed; jurors entitled to tell others they're on a jury and to describe verdict afterwards.

 

annereed: @phillyshortcite Yes.Juror networking issues are easier than people think; q is whether it would be ok if juror said it face to face.

 

phillyshortcite: @annereed I'm surprised by depth of confusion over social media & law. "Are tweets admissible?" Yep, just like everything else.

There's nothing different here. Jurors for centuries have told their friends over the weekend "I think we've finally reached a verdict!"

We just have more "friends" these days, and, as Seth Godin would put it, everything goes on your permanent record.

So, juror, if the jury's suspended while the lawyers argue and you're reading this... stop reading this! Do what the court tells you to and stick to the evidence at trial!

But if you're done with deliberations and have entered a verdict, don't sweat it. You're not the first juror to breathe a sigh of relief after months of trial.

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At the National Law Journal:

The American College of Trial Lawyers and a legal think tank have called for a sweeping overhaul of civil discovery rules to curtail expensive, time-consuming battles for documents, in a study released on March 11.

The most radical of the changes would impose strict limits on discovery after initial up-front disclosure by both sides.

...

The 30-page report contains more than two dozen proposals and general principles for overhauling the discovery rules used in both federal and state courts. It was an 18-month joint project of the ACTL and the Institute for the Advancement of the American Legal System at the University of Denver.

Saunders said the task force, drawn from the experienced trial lawyers of the ACTL, came from both the plaintiffs' and defense bar. The proposals fall no harder on the plantiffs' bar than on the defense, he said.

There's a lot to be said about this report; let me start with the most basic problem.

When I file suit, I generally have my client's story and a little bit of paperwork. The defendant possesses the bulk of the proof. If I do not pry deeply into the defendants' materials, I will lose, either at the inevitable summary judgment motion that blames me for not having the evidence I was denied, or at the trial where a sweet-talking defense lawyer points their finger at my client demanding "where's the proof?"

Under the current, supposedly excessive discovery rules, more than half of my discovery requests are already met with unfounded objections like "unduly burdensome" or "not reasonably calculated to lead to discoverable evidence," objections often sustained by courts which already apply de facto limits on discovery in an effort to move cases along. If you want a glimpse of how quickly these judgments are made by courts (as a matter of necessity given the volume), spend a morning in Philadelphia City Hall's Courtroom 285, where 200+ discovery motions are decided before lunch.

The ACTL proposals dramatically raise the incentive defendants' already have in filing frivolous objectives by giving defendants all new bases upon which to object, creating whole new anti-discovery principles such as "Proportionality should be the most important principle applied to all discovery" and "All facts are not necessarily subject to discovery." Yet, even as they greatly expand the field of possible objections, the ACTL proposals take no steps towards reducing the filing of frivolous objections.

Thus, my case is supposed to be held to defendants' self-selected "initial disclosures" followed by time-pressured "limited" additional discovery, but defendants suffer no consequences whatsoever if they initially disclose a tiny fraction of the relevant information then frivolously object to every last one of my requests, tying up the courts (and my practice) by forcing judges to determine the "limited" nature of every last discovery request.

Putting it all together: the proposals eviscerate plaintiffs' ability to seek out evidence in discovery while increasing defendants' incentives to file excessive objections.

I wouldn't say such a lopsided outcome "falls as hard" on plaintiffs as defendants; for contingent-fee plaintiffs' lawyers, it's crippling, as it hampers their ability to prove their cases while also making discovery more time-consuming, whereas for hourly-paid defense lawyers, it's a goldmine, permitting them to litigate the heck out of a case before inevitably winning it. Hourly-paid plaintiffs' lawyers (a rare beast that appears largely in the mid-to-large-size corporate world) get a boon as well, even if they keep losing their cases, too.

If the ACTL truly wants to make discovery more just, speedy and efficient, I can see three easy ways to level the playing field under these proposals:

1. Mandate spoliation and/or adverse inference sanctions for parties that do not produce adequate initial disclosures in a timely fashion;
2. Modify the summary judgment burden of persuasion to eliminate the non-movant's requirement to produce specific evidence in rebuttal (since they're less likely to have it);
3. Mandate attorneys' fees and/or sanctions against parties which lose (not merely "frivolously file," since courts rarely hold that) motions for protective orders and other discovery objections.

To put it another way: the reason I have to send so many interrogatories and requests for production of documents is because fewer than 1 in 10 gets a candid answer, usually then only after sending threatening letters and filing a motion. Put some teeth behind the principle of "disclosure" and then we'll get somewhere.

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Among the many provisions included in Obama / Congress' "Stimulus Plan" passed in February is $1.1 billion for "comparative effectiveness" research ("CER"), which will finally start putting some money into figuring out if many of the medical treatments routinely prescribed across America at considerable expense are actually worth it. DB at Medical Rants is all in favor, but Kevin MD raises a red flag:

Newsweek's Sharon Begley comments on how patients can refuse to adhere to the findings of comparative effectiveness research by suing doctors who try to do so. As she points out, "What are [doctors] supposed to do when a patient demands antibiotics for a cold? for a child’s ear infection? when a patient demands an MRI for back pain or knee pain? If they refuse, several doctors told me, they can expect a call from the patient’s lawyer that afternoon."

...

Yes, physicians are the ones ultimately responsible for ordering unnecessary antibiotics or MRIs. But, the threat of malpractice is indeed a cloud that hangs over every decision a doctor makes. Just because Mr. Cross disagrees with that doesn't make it any less true, or any less of a factor.

The patient's lawyer will call that afternoon and... what? Threaten the doctor for complying with a Federally-approved de facto standard of care?

Put simply, CER will cut both ways. A doctor who does not utilize a CER-approved treatment will have a lot of explaining to do down the road if that treatment would have helped. Conversely, a plaintiff alleging a doctor should have used a CER-disapproved treatment will have a hard time convincing a jury that the doctor should have overridden the billion-dollar research.

From a liability / malpractice standpoint, doctors who abide by the standard of care should welcome the CER with open arms, as it will give them a powerful tool to wield when a plaintiff's lawyer later asks "why didn't you do _____?" They can quite honestly answer "because the CER says it's not effective."

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As you've probably heard at sites like Overlawyered and Drug & Device Law, the sky is falling upon us because the Supreme Court didn't override Congress and the FDA and decide to pre-empt state failure-to-warn tort suits against prescription drug manufacturers.

If you don't know the basic facts, see SCOTUSBlog. Some initial commentary at the WSJ.

Wyeth manufactures pharmaceuticals, subject to FDA regulation. The FDA sets a minimum standard for the use of these drugs and their labeling; it does not dictate the text of warning labels, though it does have to approve them, which it does after intense lobbying by the manufacturers, lobbying generally unopposed by anyone at all, where the sole "evidence" are manufacturer-sponsored studies, studies which have repeatedly come under fire for conflicts of interest.

Nonetheless, under the "changes being effected" regulation, a drug company can unilaterally change its warning labels to improve patient safety.

Does this regulatory authority preclude all state tort suits alleging drug companies promoted or failed to warn against unsafe uses of these drugs?

Vested interests have spent a lot of money trying to convince judges (and the public) that this question is so hard to answer on purely legal grounds that it requires the judges start making policy instead of law.

Because the law is very clear, as the Supreme Court ruled, 6-3:

As it enlarged the FDA’s powers to “protect the public health” and “assure the safety, effectiveness, and reliability of drugs,” id., at 780, Congress took care to preserve state law. The 1962 amendments added a saving clause, indicating that a provision of state law would only be invalidated upon a “direct and positive conflict” with the FDCA [Food, Drug and Cosmetics Act]. §202, id., at 793. Consistent with that provision, state common-law suits “continued unabated despite . . . FDA regulation.” Riegel v. Medtronic, Inc., 552 U. S. ___, ___ (2008) (slip op., at 8) (GINSBURG, J., dissenting); see ibid., n. 11 (collecting state cases). And when Congress enacted an express pre-emption provision for medical devices in 1976, see §521, 90 Stat. 574 (codified at 21 U. S. C. §360k(a)), it declined to enact such a provision for prescription drugs.

Slip op. at 10.

Congress has had numerous opportunities, while amending the FDCA, to change that. It didn't.

The FDA has had numerous opportunities, while promulgating regulations with the force of law (as opposed to mere policy positions, which are not binding on courts), to change that. It didn't.

There was no "direct and positive conflict" between plaintiff's claims and the FDA approval.

There's nothing more to say here.

The Supreme Court is to be commended for refraining from telling Congress and the FDA they didn't know how to set policy, and for sticking to basic principles of judicial, statutory and regulatory interpretation.

Thanks for refraining from judicial activism.

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New to the site? Haven't been here in a while? Here are some of the most popular posts over the past few weeks.

Litigations and Trials:

• Managing Expectations in Defamation Cases: A Legendary Trial Lawyer Faces His First Malpractice Suit
• $120 Million In Hourly Billing For A Single Trial: What Happened In Robertson v. Princeton?
• How Not To Spend $120 Million In Hourly Fees On A Single Trial: A Few Questions for Robertson v. Princeton
• The Watchmen Movie Ruling: How Typical Lawyer Obstructionism Can Destroy Your Case
• "Quinn Emanuel Hit With Malpractice Suit" -- More Business Contingent-Fee Madness

Law Practice:

• Creating "The Black Triangle," A Critical Step Before Any Trial, Deposition or Brief
• "The End of Leverage"? What Are BigLaw Associates Really Worth?
• "Remember That Profits Equal Revenues Minus Costs" - The Real Reason for the Billable Hour's Impending Demise

Current Events:

• Can the Octuplets Sue for Medical Malpractice? (Part 1 of 2)
• Differential Diagnosis, Defensive Medicine and Medical Malpractice: Coumadin Edition
• 25 Things About Facebook's Terms of Use and Your Rights
• Facebook and the Law of Stealth Changes in Consumer Contracts

Recent Court Opinions:

• Pennsylvania Commonwealth Court Limits the Special Value to the Plaintiff Damages Doctrine
• Reminder: Contract Disputes Act Requires You Exhaust Administrative Remedies Before Suing the United States Government
• An Ounce of Prevention: Dismissal Upheld In Derivative Suit Because of Independent Inquiry
• The Third Circuit's 1:1 Punitive Damages Ruling: The Lingering Complications of State Farm v. Campbell

 

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Via the Law & Magic Blog (via @walterolson via @nomadtoes), I learned ahead of time of an article by Shannon P. Duffy in today's Legal Intelligencer:

In a motion in limine in Blash v. ABA Construction Group, the plaintiff's lawyers begged the judge to forbid their opponent, Steven G. Leventhal of Reger Rizzo & Darnall, from performing magic tricks or even mentioning that he is a professional magician.

Leventhal's response (the cause of most of the laughter) asked the judge to use his or her own sleight of hand to make the plaintiff's motion disappear -- with prejudice.

Now that the case has settled for $1.2 million, the motion will never be ruled on by a judge.

Just as well; it's very hard to prevail upon a judge that opposing counsel's closing argument was prejudicial, unless the closing either inappropriately referenced previously excluded or stricken testimony, or if counsel tried to inflame the jury through bias or emotion.

For kicks, I threw some search terms into Lexis and, whaddayaknow, found something similar, from the Supreme Court of Kansas:

During closing argument, an attorney is given wide latitude in the language and manner of presenting argument and may indulge in impassioned bursts of oratory and may use picturesque speech as long as he or she does not refer to facts not disclosed by the evidence. State v. Duke, 256 Kan. 703, 719-20, 887 P.2d 110 (1994). In prior cases, analogies similar to the prosecutor's "puff of smoke" argument in this case have been found to be within the permissible bounds of rhetoric and not gross or flagrant.

In Duke, 256 Kan. 703, 887 P.2d 110, defense counsel attempted in closing argument to cast doubt on the veracity of the State's witnesses and the quality of the police investigation. In response, the prosecutor told the jury there had been "'a lot of smoke in this case. . . a lot of smoke that was given to you in the argument of the defendant when he closed his case'" and, after objection to this argument was overruled, the prosecutor continued, "'It's smoke and mirrors. And when you have that, you get illuminations and things . . . trying to confuse you.'" 256 Kan. at 718. When the defendant argued on appeal that the comments implied to the jury that defense counsel was trying to intentionally mislead the jury, we found that the comments were within the permissible bounds of rhetoric. 256 Kan. at 719-20.

In State v. Baker, 249 Kan. 431, 447, 819 P.2d 1173 (1991), we concluded that the prosecutor's closing argument which included comments that the "nice boy image" that the defense was trying to give the jury was "nonexistent," and "it's a smoke screen" was neither gross nor flagrant and had not deprived the defendant of a fair trial.

Although "smoke screen" types of argument have been noted in some cases where the prosecutor's overall arguments were found improper, the comments were not found improper merely because of the smoke screen references.

State v. Rodriguez, 269 Kan. 633, 643-644 (2000). The law isn't much different anywhere else, including Pennsylvania. But that's not actually a trick, just language describing a trick. So perhaps there's room for prejudice in the actual presentation.

The article also reveals an impressive amount of candor from plaintiff's counsel, who filed the motion:

Dooley, in an interview, said that he and Coppol decided to file the motion to "bust his [Leventhal's] stones," and to throw Leventhal off his game.

But Dooley also said he believed the law was on his side and that a judge would likely agree that performing magic tricks during a trial is improper.

Maybe so. Defense counsel defends his closing as follows:

"That the undersigned counsel opted to travel the globe to learn a special set of performance skills rather than wasting his brain cells drinking his summers away at the Jersey Shore should not be held against him," Leventhal wrote.

Touché.

Frankly, I'd worry about performing a magic trick at closing, as it would not only distract the jury from what you're saying (see "Monkeys in Business Suits") but would run the risk of deeply offending jurors who had not been won over to your arguments, who would consider it all the evidence they needed that you were, as they suspected, a professional con man paid to mislead and to deceive them.

My question is not whether the judge would have granted the motion (probably not), but whether the magic trick closing is ever really worth doing. Just the facts, ma'am.

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Here are the facts, liberally edited by me:

Appellee purchased property for $ 20,000.00, including a building that was deemed uninhabitable by both the City and Appellee.

After Appellee purchased the Property, she contacted the Philadelphia Neighborhood Housing Service (PNHS) to assist her in securing a loan to rehabilitate the Property. A building inspector estimated the cost of renovation and repair to be $ 113,500.00. Another contractor estimated the cost of renovation and repair to be $ 122,590.00.

PNHS agreed to lend Appellee $ 65,000.00 to renovate and repair the Property. PNHS also agreed to help Appellee secure additional financing to reach the estimate provided by the inspector. Appellee successfully received a total mortgage commitment of $ 125,000.00 for the renovation and repair of the Property.

After Appellee received the mortgage commitments, but before any renovations were made, the City tore down the building on the Property.

So, what's it worth? The relevant Second Restatement of Torts provisions are below the fold.

One answer is market value. Plaintiff certainly didn't want that: they bought it for $20,000 and it was valued at $35,000 after the demolition, a gain of $15,000.

Another is "special value" (the Restatement calls it "peculiar value"). Here's what happened at trial:

The trial court read, in pertinent part, the following charge to the jury:

Plaintiff is entitled to be compensated for the harm done to her property. If you find that the property was a total loss, damages are to be measured by either its market value or its special value to the plaintiff, whichever is greater. The plaintiff is entitled to be reimbursed for losses reasonably incurred because of the damage to the property.

The City objected to that part of the trial court's charge which was based on Section 6.11 of the Pennsylvania Suggested Standard Civil Jury Instructions, 3rd Edition (Jury Instruction). The trial court overruled the City's objection. The jury found the City negligent in tearing down the building and entered a verdict for the Appellee in the amount of $ 80,000.00.

Oliver-Smith v. City of Philadelphia, 962 A.2d 728 (Pa. Commw. Ct. 2008). The Commonwealth Court reversed, holding:

'The fundamental purpose of damages for an injury to or destruction of property by the tortious conduct of another is to compensate the injured party for the actual loss suffered.' Department of Transportation v. Crea, 92 Pa. Commw. 242, 483 A.2d 996, 1001 (Pa. Cmwlth. 1977). Appellee presented evidence that she purchased the Property on April 8, 2003, for $ 20,000.00. The Property was later appraised, prior to demolition, at $ 20,000.00. Appellee did not present any evidence showing that she had spent any money repairing or rehabilitating the Property or that there were any unique characteristics of the Property that warranted a special value. The charge by the trial court of anything further than market value was, therefore, an erroneous extension of the range of permissible damages.

Appellee cannot receive as damages money that she never spent. Such unspent money is not actual damages, but a windfall. Section 911 provides for special value, but only for matters which can be accounted for. In this case, the loss of approved loans/mortgages which were never executed and to which no legal obligation ever attached does not amount to 'special value.' The trial court erred in directing the jury. 

There's definitely a "special value" here: the plaintiff was going to rehabilitate the project and, presumably, re-sell it for a profit. A condemned building might be worth nothing to you and me, but it's worth a lot to a contractor with a vision. The plaintiff is entitled to recover those damages.

Maybe the plaintiff didn't present anything but the sizes of the loans, in which case the above is correct. But I bet they did, since the size of the jury's verdict reflects, in my view, the lost profit on the resale of the property contemplated by the plaintiff once they had rehabilitated and renovated it. Such a number -- a projection about future profits -- is certainly open to doubt, but it's a factual issue for the jury, and the defendant (the City of Philadelphia) easily could have presented evidence to the contrary.

Oh well.

Here are the relevant Second Restatement of Torts provisions, as quoted by the Commonwealth Court:

The Restatement 2nd of Torts (Restatement), Section 927 provides in pertinent part as follows:

(1) When one is entitled to a judgment for the…destruction…of any legally protected interest in land or other thing, he may recover either

(a) The value of the subject matter or of his interest in it at the time and place of the…destruction….
 

Value is defined in Section c of the comments to Restatement Section 927 as follows:

c. Value. As stated in §911, "value" includes market value and value to the owner. A person tortiously deprived of property is entitled to damages based upon its special value to him if that is greater than its market value.
 

Restatement Section 911 provides in pertinent part as follows:

(1) As used in this Chapter, value means exchange value or the value to the owner if this is greater than the exchange value.

(2) The exchange value of property or services is the amount of money for which the subject matter could be exchanged or procured if there is a market continually resorted to by traders, or if no market exists, the amount that could be obtained in the usual course of finding a purchaser or buyer of similar property or services. The rental value of property is the exchange value of the use of the property.

Comments (b) and (e) of Restatement Section 911 provide in pertinent part as follows:

(b) Market value. If there is an established market, the value of property ordinarily is determined by the amount paid in actual transactions involving a similar subject matter if the transactions have occurred at or about the time fixed for determining value.

    ***

(e) Peculiar value to the owner. The phrase "value to the owner" denotes the existence of factors apart from those entering into exchange value that cause the article to be more desirable to the owner than to others.

    ***

Real property may also have a value to the owner greater than its exchange value. Thus a particular location may be valuable to an occupant because of a business reason, as when he has built up good will in a particular neighborhood….

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As expected, Fumo's defense has gone on the "offensive," so to speak, and has done much more than merely poke holes in the prosecution's case, though they have done that, too.

They've put Vince himself up there to explain everything. And he's gone down the roads anticipated in that last post. He's proudly (some might say defiantly) admitted the secret settlements behind the PECO and Verizon suits, overworking his staffers and putting them on personal duties, and pulling the strings at Citizens' Alliance.

As predicted, he has directed his efforts at arguing what he did was not criminal, or, if it technically was, that he shouldn't be convicted anyway (an argument only made implicitly by references to the merits of political power and boogeymen like Enron, rather than explicitly, which would earn him and his lawyers a sharp reprimand).

Of course, his testimony isn't really the interesting part -- cross-examination by the US Attorneys, likely to begin tomorrow, is the interesting part.

So what's he need to do? Obviously prepare, prepare, prepare. Get his thoughts in order. A skilled trial lawyer can quickly start dragging an unprepared witness around by the nose.

But there's another, counter-intuitive piece of advice: Fumo needs to refrain from having an explanation for everything.

If there's one thing a jury hates, it's a liar. Some liars are dumb, have bad memories, or otherwise expose themselves to inconsistencies and attack. Those are the easy ones to expose.

The smart ones are harder to deal with -- they rarely offer you inherently contradictory testimony, you have to walk them into it. You have to give them enough rope to hang themselves with.

In general, a trial lawyer has a huge cognitive advantage over a witness. Whereas the witness knows what they're going to say in response to a particular question, the lawyer knows where the questions are going. Let's go back to my third Fumo post:

The two "rules" for cross examination are well-known and taught at every law school. Use leading questions only (i.e., questions with a yes or no answer), so that the witness will not have a chance to tell their story again. Do not ask any questions for which you do not already know the answer.

That is the safe option. Do that as a trial lawyer and you will not be sued for malpractice. No one will blame you when your client loses.

Do that in a difficult case -- Fumo has a very difficult case -- and you will lose.

Jurors want drama. They want a fight. Some lawyers and commentators blame television shows and movies for the jury's expectation that the criminal defense lawyer will assault the prosecution's main witnesses, but I believe the situation inherently demands drama. If the witness is calling your client a criminal, you have no choice but to call them a liar and to prove it.

How do you prove it?

Timing.

If you can understand the difference between Humpty Dumpty and Socrates, you can understand the difference between direct and cross-examination. Cross examination leads, direct examination builds.

Like Dennis Cogan and Edwin Jacobs, Robert Zauzmer and John Pease aren't amateurs, and they're not timid. They're not going to stick to scripted leading questions, not going to only ask Fumo questions to which they already know the answer.

The prosecutors are going to lead Fumo, to get him to talk. And talk, and talk, and talk.

Because they want to force Fumo to do one of three things:

1. Appear to be uncooperative. (Liar!)
2. Stumble into a contradiction and then be called out on it. (Liar!)
3. Become a used-car salesman. (Liar!)

The third is the part that most well-educated witnesses -- whether they're doctors, businessmen, lawyers, or otherwise -- fail to guard against.

Sure, everyone gets cagey and defensive when under hostile questioning, particularly when their liberty is on the line. Jurors know that. And they know he's been preparing for this for years. But at some point, a jury will not accept testimony from a witness who appears to have an answer to everything. Not even a politician.

It's certainly Fumo's biggest weakness -- just consider the tape played from the Michael Smerconish show. He just couldn't help himself. I wouldn't be surprised if the prosecutors played that for him, not just to remind the jury, but to see if they can get Fumo to start explaining it away. His liberty may depend on holding back everything he's been for thirty years and coming clean with each and every answer, the first time around.

Can Fumo do it? 

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The San Francisco Chronicle writes,

The Web 2.0 movement, which ushered in an interactive Internet, sought to put power in the hands of the people by tapping the so-called wisdom of the crowds to change the world - and to keep such a digital democracy in check.

A decade later, as defamation lawsuits have begun to mount, some are questioning the wisdom of the crowds, and wondering if it hasn't turned into mob rule.

"I don't know why this has taken so long," said Andrew Keen, author of a controversial book, "The Cult of the Amateur: How Today's Internet is Killing Our Culture." "The Internet is a culture of rights rather than responsibilities. We have no coherent theory of digital responsibility. The issue has broken through, broken out of Silicon Valley - now it affects real people with real reputations to defend."

I guess I'm supposed to be impressed by the "rights" and "responsibilities" distinction. I'm not. Every legal "right" is an enforceable legal "responsibility" upon another.

Take the First Amendment. The right to free speech imposes on the government the responsibility -- whether the government wants it or not -- to let you speak freely.

But back to the subject at hand, defamation law:

Meanwhile, the review site Yelp, based in San Francisco, has found itself in the crosshairs of the free e-speech debate.

Yvonne Wong, a pediatric dentist in Foster City, recently sued Los Altos couple Tai Jing and Jia Ma after they criticized her treatment of their son in a posting on Yelp. They questioned her use of laughing gas and said they were angry she had used fillings containing mercury.

Wong's lawyer, Marc TerBeek of Oakland, said the review is false, and Yelp has since taken it down.

That reminds me of a Pennsylvania case, a lawsuit brought by another physician who felt he had been slandered with regard to his methods:

There were four counts in the declaration.

1st count. "He, (the plaintiff,) is not a physician, but a two-penny bleeder."

2d count. "He, (the plaintiff,) was called to a man near the new bridge, who had injured his leg, and by his (plaintiff's) bad treatment the man must have been lame for life had not I, (defendant, Dr. Small,) been called to him."

3d count. "Foster had given a child stuff to butcher it."

4th count. "He, (the plaintiff,) had butchered a child."

That case was Foster v. Small, 3 Whart. 138 (Pa. 1838)(upholding directed verdict for defendant because "Now though words which impute professional ignorance are certainly actionable, yet to say of a physician that he is a two-penny bleeder, imputes not want of professional skill, but want of professional dignity manifested by a petty attention to the humbler employments of the art. They are, in fact, words of mere contempt.").

Did you catch the year? That virtually identical doctor-slander case was decided one-hundred and seventy-one years ago, long enough ago that calling a doctor a "bleeder" -- one who treated by bleeding the patient -- was a sufficiently accepted practice that it wasn't defamatory to accuse a doctor of being a "bleeder."

Defamation -- whether written ("libel") or spoken ("slander") -- is among the oldest claims recognized by the legal system, dating back to ancient Rome and likely before.

The law isn't changing. People aren't changing. Only one thing is changing: people are more connected.

Here's an example. Based on a suggestion from Robert Scoble, whom I've never met, I search Friendfeed for "defamation" posts (with 5 comments and 5 "likes") and find a Twitter post (with about 50 comment and 50 "likes") from Mona L, who I've never met, that says:

“Should you be held accountable for what you publish online? - Cnet "Yelp user faces lawsuit over negative review" http://tinyurl.com/7uwtom”

The link is to a story on a different Yelp defamation suit. We don't even have to consider the story to see how powerful the internet is at spreading commentary -- the tweet and the Friendfeed post alone were viewed by hundreds, more likely thousands, of people.

With every single off-the-cuff comment about that story effectively permanent, broadcast-worldwide, and easily accessible world-wide.

But that's it. People haven't become more disgruntled with one another, nor more prone (or able) to sue, nor have we suddenly left a responsible and respect world for "mob rule." The allegedly defamatory comments just spread faster, travel farther and last longer.   

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In the comments to "Can the Octuplets Sue for Medical Malpractice," B. Barton asks:

Numerous sources have reported that Ms. Suleman wanted these [6] remaining embryos transferred [2 of which split into twins]. Where does liability lie if that's true?

Good question. Since there's little doubt that it's a breach in the standard of care for a physician to transfer 6 embryos (monozygotic twinning is a known risk of IVF, so the doctor can't claim surprise at it), we can rephrase this question as: can a patient consent to a procedure that would ordinarily be medical malpractice?

First, a little background. There are two claims which sometimes get lumped together as "medical malpractice." One is the "negligence" claim most people think of, in which a doctor breached the standard of care by either not doing something they should have or doing something they should not have. The other is the "informed consent" claim, explained by the New Jersey Supreme Court as arising from "the duty of a physician to disclose to a patient information that will enable him to evaluate knowledgeably the options available and the risks attendant upon each before subjecting that patient to a course of treatment." Perna v. Pirozzi, 92 N.J. 446 (1983).

Every day, thousands of patients consent to unnecessary, experimental or risky procedures. So long as the patient was properly informed of the risks, benefits and alternatives, and the procedure was properly performed, the physician will not be liable for adverse consequences.

But this situation is far outside the realm of normal medical practice -- so much so that the Medical Board of California has opened an investigation into it. There's no shortage of fertility doctors with the opinion that:

"In order for IVF to cause octuplets, a doctor would have to place eight or more embryos back, which is way beyond the guidelines."

And many agree with Hickman to put eight embryos back would be medically unethical. Simply put, having multiples is a huge risk.

"You can have all sorts of problems with the brain forming properly. You can be left with cerebral palsy, injuries, blindness, problems with the lungs working," he said.

As such, this case is not analogous to situations where a patient chooses among reasonable options with differing risks and benefits, like a cancer patient electing to have surgery over chemotherapy. Instead, it's a patient requesting the physician breach the standard of care.

For obvious reasons, there aren't too many court opinions ruling on such a case (most plaintiff's lawyers would reject such cases as unwinnable, regardless of the law, given juror sentiment like B. Barton's). But there's reason to think a court would permit either the mother or the octuplets to bring such a claim, despite the mother's "consent" for the procedure.

While patients can assume various risks of a procedure, a patient cannot assume the risk their doctor will commit malpractice. The reasoning is simple:

In the context of medical malpractice, the superior knowledge of the doctor with his expertise in medical matters and the generally limited ability of the patient to ascertain the existence of certain risks and dangers that inhere in certain medical treatments, negates the critical elements of the [assumption of risk] defense, i.e., knowledge and appreciation of the risk. Thus, save for exceptional circumstances, a patient cannot assume the risk of negligent treatment.

Morrison v. MacNamara, 407 A.2d 555, 567-568 (D.C. Ct. App. 1979). Thus, even if a patient appears to have "understood" and "assumed" that a procedure was generally risky, there still may be a claim for medical malpractice, as the law recognizes the superior knowledge of the doctor and does not expect patients to have the same technical understanding -- including an understanding of where the medical community draws the line -- as physicians.

Then there's the informed consent claim. As shown in the interview you referenced, it doesn't seem Nadia Suleman fully appreciated the risks of the procedure; she seemed to revel in them.

In some states, so long as the physician provided the same information as would be provided by a "reasonably prudent medical practitioner acting under the same or similar circumstances," then there's no claim for a lack of informed consent. Perna, supra. Again, however, we have to realize how far outside the bounds of normal medicine we are, and I don't doubt that many fertility doctors believe that no "reasonably prudent medical practitioner" would ever counsel a 33 year old woman with a history of successful IVF treatment to transfer 6 embryos.

In other states, the question is not what the patient themselves would have done with appropriate information, but what "a prudent person in the patient's position would have decided if suitably informed of all perils bearing significance." Perna, supra. The primary purpose of such a rule is to prevent disgruntled patients from claiming, after the fact, that they would have chosen a different option if the doctor had disclosed all the risks, but the door might swing both ways: the jury might be asked to determine what a prudent person in the patient's position would have decided if given all the appropriate facts, and find that a "prudent person" would have rejected the procedure.

Finally, it bears repeating what we're talking about here: the theoretical ability of the mother or the children to bring a claim for medical malpractice under the law. There's a high likelihood an actual jury would reject all of these claims out of hand.

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Legally, almost nothing. The burden lies with the plaintiff (or prosecutors) to prove the elements of their claims, and the defense can sit back and do nothing more than poke holes in those claims. (There’s an exception for “affirmative” defenses like Fumo’s proposed “advice of counsel” defense, discussed previously.)

Fumo’s lawyers have certainly done their share of poking holes in the prosecution’s case, with lengthy, often painful cross-examinations of the FBI agents and accountants who performed forensic examinations of the books for the State Senate, Citizens Alliance and the Independence Seaport Museum.

Although these cross-examinations are boring to most observers, even those who have followed the trial closely, their importance should not be understated. As I’ve written before, although I have seen plenty of cases in which I could not understand why the lawyer by being so excessively nitpicky – even when I was the one doing it! – I have never actually heard a juror complain about such a cross-examination, nor have I seen a jury fail to appreciate the deeper meaning of such a laborious exercise if it bears fruit.

And such nitpicking can bear fruit, as it did for Fumo: nitpicking showed the jury that the issues weren’t as simple as the prosecution contended. Since Fumo’s charged with white collar crimes, complexity plays to his advantage. Whether it be appropriate invoicing by a contractor in a white collar criminal case, or the use of a particular technique by a doctor in a medical malpractice case, or the choice between options by a manufacture in a product liability case, at some point an issue becomes so complicated that jurors will respect most any reasonable judgment made by the defendant.

But Vince Fumo can’t sit back and poke holes in the prosecution’s case.

There’s simply too much out there. Intentional or not, the prosecutors have stripped Fumo of the general sympathy and affinity most people inherently feel for one another by portraying Fumo as a thin-skinned creep whose own daughter won’t even speak to him and who spied on his ex-girlfriend’s email. The prosecutors have also shown beyond any reasonable doubt that Fumo received substantial political and personal work from his Senate-paid staff, that Citizens Alliance and Independent Seaport Museum conferred substantial pecuniary benefits on him (even if they didn’t give him any money directly) and, most importantly, that Fumo panicked when he learned of the FBI investigation, after which he took substantial steps to minimize evidence left behind.

 

Indeed, Fumo’s lawyers didn’t dispute most of that. They couldn’t.

 

They have something else in mind: they’re going to “prove” the case by framing the context and mindset of Fumo’s actions.

 

The first few witnesses have been directed towards that context. Surprisingly, perhaps the most revealing context came in response to questions by the prosecution posed to former Montgomery County District Attorney (and currently County Commissioner) Bruce Castor.

 

Under cross examination by U.S. Attorney John Pease, however, Bruce Castor admitted that he and Marrone discussed a number of political concerns during normal business hours in Castor’s office, which Castor admitted was probably inappropriate.

 

But Castor’s admission raises a simple question: why has Vince Fumo been indicted for using his staff for political purposes but not Bruce Castor?

 

Cogan tried to drive that point home with testimony by Paul S. Dlugolecki, one of Fumo’s top advisors, that other Senators frequently did the same around election time. Zauzmer called him out on it, demanding Dlugolecki “name one” who did, to which Dlugolecki demurred, but the point was made. Frankly, as open as the testimony has been, I doubt any juror expected Dlugolecki to spill the beans and I doubt they’ll hold it against him.

 

Over the next few days we’ll continue to see more of that context: the defense’s goal will be to create enough context to rebut the prosecution’s central assertions underlying the fraud charges, which is that Fumo had staffers and contractors on the senate payroll who did no work for the government and that Citizens Alliance and the Independent Seaport Museum were treated like shams to benefit Fumo. They don’t have to rebut everything, just paint enough context to slant everything else.

 

Fumo doesn’t have to do much for the fraud charges: once he shows largely legitimate explanations for what happened, and once he challenges the worst allegations – like those made by Marrone – he’ll likely earn back reasonable doubt. The jury knows the FBI dug deep for months, and they’ll expect a case that’s, if not airtight, is at least watertight. If Fumo can show that everyone saw him dipping his hand into the cookie jar, and that the FBI has mislabeled a significant number of cookies, he’ll likely create enough reasonable doubt to avoid most of the charges.

 

The obstruction of justice charges are harder to fight: as the context for them is an FBI investigation. As such, Fumo’s lawyers will need to show that Fumo’s mindset – his paranoia and rampant destruction of emails – long preceded the investigation, and that he had reason to believe he could continue such destruction even after he got wind of the investigation.

 

And that’s where the lawyers come back into play. It also presents a judgment call for Dennis Cogan and Edwin Jacobs on how they portray the mindset of the clients, who appear to have deliberately destroyed documents in the face of an FBI investigation: do they reject the prosecutor’s portrayal of the defendant’s paranoia and recast their clients as confused innocents, or do they run with the paranoia and claim the destruction was nothing unusual for them, and so didn’t reflect a guilty mindset?

 

The former is the safe choice, but their hands are tied by the facts.

  

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On Christmas Eve, the Third Circuit issued its opinion in Jurinko v. The Medical Protective Company and The Medical Care Availability and Reduction of Error (MCARE) Fund, a fascinating insurance bad faith claim arising from the failure to tender policy limits in a medical malpractice case, prompting an article in yesterday’s Legal Intelligencer and a flurry of twitter and blog activity. Perhaps it’s a lesson to all of us in the limitations of twitter and blogs and other rapid-response social media. Bob Ambrogi’s tweet “3rd Circuit imposes 1-1 ratio for punitive to compensatory damages” was technically correct, as was this AmLawDaily blog post summarizing the holding:

The court, citing two U.S. Supreme Court rulings (including the Exxon case), ruled that the award was excessive under a test the high court devised in a 2003 case. The judges went further, though, in concluding that the Supreme Court's general path points toward a 1-1 ratio between compensatory and punitive damages becoming a general guidepost. Good news for corporate defense lawyers.

Both, however, miss the point: the Third Circuit didn’t create or recognize a brightline 1-to-1 ratio. It’s a little more complicated than that.

Taking the “precedential” and “non-precedential” designations at face value (in spite of Federal Rule of Appellate Procedure 32.1 making such designations irrelevant), the non-precedential Jurinko opinion must give way to the precedential CGB Occupational Therapy v. RAJ Health Services, et al. opinion of August 23, 2007, which reduced a verdict of 18-to-1 punitive-to-compensatory damages down to 7-to-1 in another case also involving purely economic damages (and thus falling squarely under State Farm and Gore).

On the face of the two opinions, the take-home message is that, in the wake of recent Supreme Court precedent, trial and appellate courts will give very little weight to jury’s punitive damages awards and will instead look anew at the facts to determine, in the court’s own judgment, the degree to which the plaintiff established the State Farm v. Campbell elements for exceeding the 1-to-1 ratio:

(1) the degree of reprehensibility of the defendant’s misconduct; (2) the disparity between the actual or potential harm suffered by the plaintiff and the punitive damages award; and (3) the difference between the punitive damages awarded by the [factfinder] and the civil penalties authorized or imposed in comparable cases.

State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S. 408, 418 (2003). (I note here how courts frequently overturn jury verdicts awarding punitives but never overturn verdicts denying punitives.)

Viewed that way, the distinction between the cases is clear: the conduct of Medical Protective was not nearly as reprehensible as the conduct of Sunrise (the company responsible for the most wrongful conduct in CGB Occupational Therapy), because Medical Protective merely acted in an outrageous manner to protect its own financial interests, rather than intentionally setting out to harm the plaintiff, as Sunrise did. The size of the respective underlying compensatory awards was also critical: in Jurinko, the jury awarded $1,658,345 in compensatory damages, as compared to the $109,000 awarded in CGB.

In essence, as a defendant’s conduct becomes worse, punitives above 1-to-1 are allowed but will be discounted by the size of the compensatory damages. (Again, note how no opinion will conclude, for example, “because the jury did not recognize how truly reprehensible the defendant’s conduct was, we hereby triple the punitive damages awarded.”)

Which brings me to what I believe is the real meaning behind both of these cases: courts have begun to take an economic, as opposed to legal, view of punitive damages. In line with the Supreme Court’s criticism in Exxon v. Baker of “the stark unpredictability of punitive awards” – an economic, not legal, concern – courts are increasingly unwilling to uphold verdicts designed to financially punish defendants (one of the explicit goals of punitive damages), even where the defendant has acted in a manner the court itself has recognized as “outrageous” and “reprehensible.”

I think that’s a shame, particularly given the mechanism by which such civil immunity from bankruptcy is being enacted: constitutional interpretation, the second most powerful weapon in the legal arsenal after constitutional amendment. If the duly-elected legislature decides that unlimited punitive damages awards are outweighed by the need for “predictability” after outrageous and reprehensible conduct, that’s one matter, but to see the courts usurp an economic policy determination under the rubric of constitutional interpretation is quite another.

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The Philadelphia Inquirer published a review of the just-released biography of Jim Beasley, the founder of my firm:

Legendary Philadelphia trial lawyer Jim Beasley achieved national fame - and vast wealth - by magically spinning humdrum details into compelling courtroom drama. Former Inquirer reporter Ralph Cipriano's account of Beasley's life, unfortunately, too often does the opposite. ...

Part of the problem is structural. The original book idea was for Beasley and Cipriano to write about Beasley's big cases, which are world-class: Epic battles against The Inquirer on behalf of Dick Sprague; Beasley versus boxing impresario Don King; Beasley winning a record $907 million wrongful-death verdict against fugitive murderer Ira Einhorn; Beasley as the first lawyer to serve legal process on the Taliban after 9/11 - followed by a $100 million-plus judgment.

It was a good plan.

But then Beasley died.

Still, Cipriano stuck with the one-case, one-chapter format. Deprived of Beasley's insights, however, Cipriano was forced to rely instead on juiceless trial transcripts, which are often stilted and obtuse. The result: a narrative that covers an impressively broad legal landscape, often interesting and insightful, but with a formulaic feel at odds with Beasley's verve and spontaneity.

It's not surprising that I have a more favorable view of the book -- look to the right and you can see a picture of the book's cover, which is link to the book's webpage. I know the author. I went to the law school that now bears Beasley's name and work at the firm Beasley founded.

I don't know David Marston and I don't think he meant to be unfair, but I do think one mistaken impression should be corrected: most of the book arose from original reporting, not trial transcripts, a distinction that comes across readily when reading it.

Take the cases listed above: Cipriano got the Inquirer editor, the judge, and the defense lawyer in Richard Sprague's case to talk, as well as the federal court mediator in the case against Don King. It's a fascinating read, better than you'll get in most trial or lawyer books, with a quick pace.

True, Beasley's own voice is not in the book, but so what? When's the last time you read a great biography, particularly one of a trial lawyer, with ample assistance from the subject? Even the most humble of subjects come across as arrogant and self-serving when opining upon their own legacy.

Truth be told, most "authorized" or "cooperative" biographies are terrible, with insufficient distance from their subjects. Robert Caro's The Power Broker, for example, one of the finest biographies ever written, was done without any assistance whatsoever from Robert Moses, but rather good old fashioned shoe leather and long conversations, pen and pad in hand, with Moses' contemporaries.

Martson also missed, to me, the critical part where Jim Beasley's personality shines through in the book: that awful title, Courtroom Cowboy, which caused Michael Smerconish to drop his head in his hands when Beasley chose it. You can't read words so self-assured without them smacking you in the face.

Which is how he wanted it.

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From the Associated Press:

Pardo's downward slide ended Christmas Eve, when the 45-year-old electrical engineer donned a Santa suit and massacred nine people at his former in-laws' house in Covina, where a family Christmas party was under way. He then used a homemade device disguised as a present to spray racing fuel that quickly sent the home up in flames.

Pardo had planned to flee to Canada following the killing spree but suffered third-degree burns in the fire — which melted part of the Santa suit to him — and decided to kill himself instead, investigators said. His body, with a bullet wound to the head, was found at his brother's home about 40 miles away.

...

Pardo had a 9-year-old son, Matthew, by another former girlfriend, Elena Lucano. He had not seen the child for years, but apparently was claiming him as a dependent for tax purposes. Lucano told the Los Angeles Times that she didn't know Pardo was claiming their son as a dependent.

The boy was left severely brain damaged as a toddler when he fell into a backyard swimming pool on Jan. 6, 2001 while Pardo was alone with him at his former home in Woodland Hills, according to attorney Jeffrey Alvirez, who represented Lucano in the resulting court case.

Medical costs reached $340,000. Lucano sued Pardo to obtain money from his $100,000 homeowner's insurance policy and about $36,000 was put into a trust fund for the boy, who requires constant care. Pardo never contributed any more money to the boy's care.

"He never spent a dime on his son," Alvirez said.

A high school girlfriend described Pardo as, back then, having been "a very easygoing person, a very friendly guy." Now he's the Santa Gunman, after years of ignoring his own disabled child.

I often hear that personal injury plaintiffs want to "get lucky" with their accident, that the most important consideration is to ensure no one gets a "windfall." No doubt, there are plenty of people who want to find a reason to sue or to profit from a trivial infraction. I reject cases like that every day.

But let's be clear: no one who needs a trial lawyer is "lucky." Most of my catastrophic injury or wrongful death cases look like Matthew's. A child, a loved one, or an "easygoing, friendly" person was going about their ordinary life, doing something everyone else has done, when something went terribly wrong.

It wasn't too long ago that Matthew's case would be considered a hunt for a "windfall;" after all, they were suing over something his own father did. Law students will recall Arizona's Broadbent v. Broadbent case, 184 Ariz. 74, 907 P.2d 43 (1995), a favorite of textbooks, which involved similar circumstances and the doctrine of "parental immunity."

There are obviously far more causes of the tragedy here -- from mental illness, to a messy divorce, to losing his job -- than his son's accident. But I can't help but wonder what Bruce Pardo's life would have been like if his son had never been injured. I'm sure he wondered, too.

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Cal Biz Lit tips us off in a great how-to post for defense lawyers about an early step in the process:

This first step is not unique to California, and not unique to product liability cases.  In fact, Phone the phrase “stupid call” wasn’t even invented in California.  As far as I know, the phrase was invented by a friend of mine who practices product liability nationally but is based in Montana.

The elements of the first step are incredibly simple:

1.    Pick up telephone;
2.    Dial number of plaintiff attorney;
3.    Engage him or her in pleasant, or at least civil, conversation;
4.    Act stupid about his or her case (this is easier for some of us than others);  and
5.    Try to get him or her to tell you as much about the case as possible.

The theory of the stupid call is really simple:  first of all, more information is almost always better than less information.  And while you can expect that the other side is going to posture, exaggerate, and, dare we say it, confabulate, the odds are that they are also going to tell you some things about the case that you wouldn’t otherwise know.  And since the California complaint may have told you very little – in fact, if it’s a Judicial Council Form Complaint, it told you nothing at all – this is your chance to at least learn something about the injury and how much the plaintiff’s attorney knows.

Now, it may be that the other side won’t give you any useful information.  It may be that he or she won’t even talk to you;  there are plenty of jerks in this world, and a representative number of them are lawyers.  But the other side isn’t going to give you any useful information if you don’t call, either, so you aren’t going to be any worse off for trying.

That's pretty common and it's not a bad idea for defense lawyers, but there are some caveats.

First, I'm usually candid about my theories, to a degree, because I want to frame the whole case on my terms, not your's. Letting me infect your brain with my memes is sometimes in my best interest.

Second, if you act really stupid -- you "don't understand" a common legal issue or you "haven't heard" a particular industry standard -- I will take that as a sign that you are a lying snake and I will suspect and treat you accordingly.

Third, we're all one big community of lawyers. Maybe you think I'm some nobody in your world and you'll never encounter me again. Maybe that's true. But maybe, just maybe, someday someone whose opinion you care about is going to ask me about you and I'm going to say, "he called me at the beginning of the case and either acted like he was stupid or really was just STUPID." Is that the reputation you want?

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Above The Law refers us to Newsday's coverage of the ugly mess that has become of the Martin Garbus, Esquire vs. Samantha Ronson vs. Perez Hilton suits, which now stand a good chance of becoming far more embarrassing for Lindsay Lohan than the blog post which prompted the original defamation suit.

Here are the facts in the underlying dismissed Ronson vs. Perez suit:

At the bottom of the failed libel suit and the pending malpractice action is a one-car crash: Lohan's Mercedes-Benz versus some shrubs in Beverly Hills on May 26, 2007. Police reported finding a small amount of cocaine in her car. The actress eventually entered rehab and pleaded guilty to driving under the influence.

About a week later, according to the libel suit, Hilton, whose real name is Mario Lavandeira, posted an item on his blog linking to a juicy story on an another blog called Celebrity Babylon. Citing unnamed sources, Celebrity Babylon reported the cocaine belonged to Ronson. Additionally, according to the suit, the story said Ronson "has accumulated a substantial side income taking her pal in front of paparazzi cameras for money."

"With friends like Samantha Ronson, Lindsay doesn't need enemies," Hilton blogged. Two weeks later, he posted a picture of himself on perezhilton.com wearing a sweatshirt emblazoned with "Blame Samantha" and referred to her as a "lezbot dj", according to the libel suit.

There's fodder there for a defamation suit, but not much. Hilton didn't post the original defamatory facts, he linked to them with some of his own comments. As a journalist -- and Hilton absolutely is a journalist, he reports more than full-time with substantial resources for investigation -- Hilton has some duties to assess in his own mind the likely veracity of the story, but he doesn't have to confirm it's entirely true unless he gives the story's facts his own stamp of approval. As far as I can tell, he didn't, he linked to it. (In an affidavit, he asserted his own good faith in linking to the story based upon dozens of reports he had received of Ronson's drug use).

"Blame Samantha" sure is obnoxious, but it's hard to see what defamatory facts are implied there given the context of Hilton publishing the story as coming from a separate source.

First, a word on the unusual and apparently excessive fees here. I typically represent defamation plaintiffs on a contingent fee basis; doing so presents a substantial risk of losing money given the nature of defamation cases (more on that later), but it's also par for course. Ronson hired Garbus at $750 an hour. Based on the little bit that comes through the article, Garbus seems to have billed her at least $142,000 without even getting to the anti-SLAPP hearing (part of California's preemptive strike against wrongful use of civil proceedings) or taking Perez Hilton's deposition.

Which is to say, Garbus charged her a boatload for nothing, as he did not even get past the very first hurdle in the case, the anti-SLAPP hearing, the equivalent of a motion to dismiss in other state courts.

Garbus also allegedly promised the whole case would cost $75,000; I suppose that's possible at $750 an hour (i.e., 250 hours once you consider that an associate at half the price will be doing two-thirds of the time) if you streamline the process and the other side doesn't go crazy with motions or discovery. Given the parties and issues here, I don't see how that would have been possible. Obviously, Hilton's lawyers are going to go straight to the drug use and will do their best to dig into Ronson and Lohan's personal lives (as Garbus himself is now doing). For comparison, Hilton's attorneys made it up to $85,000, or at least that's how much Ronson was ordered to pay for Hilton's attorneys' fees.

Second, what did Garbus and Ronson, respectively, expect to happen? Perez Hilton did not originate the story, Celebrity Babylon did, and Ronson was arguably at least a limited-purpose public figure (and/or Lohan was with regard to the source of the cocaine found in her car), making it much harder to prove the requisite intent ("malice") to get by First Amendment protections.

So it was a tough case from the start, which Garbus should have known and should have told Ronson. Given Hilton's hearsay repetition of the actual defamatory facts, odds were high he'd get out on anti-SLAPP, which Garbus should have told Ronson. Moreover, Ronson should have been told that, even if she had "won," she could have "lost" once Hilton started digging into her personal life and, perhaps worse, Lohan's personal life.

Maybe Garbus did tell her all of that. Yet, in the article, Hilton's lawyer is quoted as saying that Garbus' anti-SLAPP motion response was garbage. There are also references to Garbus not "worrying" about Ronson's case until Hilton's lawyers filed their motions. If true, those cast doubt on Garbus' whole story, since he should have recognized the anti-SLAPP problems from the start and should have been preparing for that from the start. If I had pursued Ronson's case here in Pennsylvania, from day one I would have been working on my First Amendment arguments.

But let's give Garbus the benefit of the doubt and assume that the truth lies somewhere in the middle between Garbus and Ronson's allegations. If so, there still seems to be a fundamental problem that Ronson, no matter what she was told, did not recognize just how tenuous the case against Hilton was. Nothing else explains her conduct, even if she was at times out of touch or hard to reach.

Which brings me to the main point here: defamation cases present a unique problem in client relations for trial lawyers, as they are among the hardest cases to win and usually involve the most emotionally-invested clients.

Defamation cases frequently lose. Indeed, sometimes even when they win, they lose, in the form of lost privacy or nominal jury verdicts.

Did Ronson know that? Regardless of what Garbus told her, the facts strongly suggest that she didn't get it, and that this whole mess could have been avoided if she had a better understanding of the issues and the case from the start. That presents a lesson for all of us trial lawyers -- do your clients really get what's going on?

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At the WSJ Law Blog:

This just in: A federal jury on Monday cleared Chevron Corp. of responsibility for any human rights abuses during a violent protest on a company oil platform in Nigeria a decade ago. Click here for the recent AP story; here for a longer takeout on the case from the WSJ’s Russell Gold.

Human rights groups had sued the company under the Alien Tort Claims Act, which allows foreigners to file lawsuits in U.S. courts alleging international law violations.

I highlight these defense-verdict cases not because I think the jurors were right or wrong -- I have no idea how I would interpret the evidence, I only know press reports on this case -- but to point out that a San Francisco jury, begged for relief by sympathetic, impoverished plaintiffs, sitting in judgment of an immensely profitable defendant that's part of a hated industry, in consideration of facts that turn the stomach and inflame the passion, nonetheless still held in favor of the defendant.

Keep that in mind the next time some says that dumb jurors just take rich people's money and throw it at sympathetic plaintiffs. If anyone's rich, it's an oil company. If anyone's sympathetic, it's an impoverished worker attacked by their own government.

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A picture that's been making its way around the internet:

Can you imagine how fast they were going?

From the Daily Mail, here's why this picture is evidence of triumph, not failure:

The un-named driver and his passenger were taken to the Royal Adelaide Hospital for treatment, but their injuries were said to be not serious.

"Not serious?" They destroy a race car driving it into an immobile object at a speed most people never reach and their injuries are "not serious?"

Ignore the idiot driver. Three cheers for Ferrari, for designing a car that collapsed in such a manner to slow the impact sufficiently to prevent decelleration injury, yet not permit intrusion into the driver and passenger spaces.

That is to say, the Ferrari "failed well." When things went wrong, it did its job and accomplished its primary goal of protecting the occupants.

Compare to all the things you have seen "fail badly," like the trial case that collapsed when a third party witness mixed up seemingly (to them) minor details, or the litigation that changed course entirely when you trapped a defendant with inconsistent discovery answers, or the complete waste of a day when you botched a filing procedure in the most trivial of ways and then spent hours rectifying the situation.

Before your next trial, think for a moment: what happens if I lose most of the court rulings, get beat up by my opponent's witnesses, and can't keep my witnesses from fumbling most of their testimony? 

If the answer is, "I definitely lose," then you need to rethink your strategy. You need to find a more robust theory of the case that can deliver your passengers safety to their destination.

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There is an old legal saying, phrased many different ways: “if you have the facts, argue the facts. If you have the law, argue the law. If you have neither, just argue.”

Vince Fumo and Ruth Arnao’s lawyers don’t have the facts. There is no denying that Fumo’s Senate-paid staffers and contractors performed extensive personal services for him or that the Citizens Alliance for Better Neighborhoods, run by Arnao, provided substantial benefits and gifts to Fumo, or that the Independence Seaport Museum allowed Fumo to use their yachts for personal and political purposes free of charge. Those are the facts and there is a mountain of evidence in support.

Having few facts on their side, Dennis Cogan and Ed Jacobs have primarily argued the law. In their opening statements, both said that much of the conduct alleged by the United States Attorneys was not illegal, and that Fumo and Arnao could, respectively, use Senate employees for personal tasks if that increased the productivity of the office and compensate Fumo for his work on behalf of Citizens Alliance by covering many of his personal expenses.

There is just one conceptual problem in arguing the law to a jury: the District Court already ruled, more than a year ago in the run-up to this trial (when Judge William H. Yohn, Jr., still had the case), that “using state legislative employees for non-legislative tasks, while compensating them with state money, wrongfully deprives the legislature of its money or property.” United States v. Fumo, 100 A.F.T.R.2d (RIA) 6902 * 23 (October 27, 2007).

There was nothing surprising or unusual about that ruling: just two weeks before Yohn’s opinion, the Pennsylvania Superior Court upheld a conviction of another legislator for “knowingly and intentionally [using] the authority of his office to derive pecuniary gain.” Commonwealth v. Habay, No. 1518 WDA 2006, 2007 Pa. Super. 303, 934 A.2d 732 (Pa. Super. Ct. Oct. 10, 2007). Similarly, the District Court also ruled over a year ago that, if Arnao failed to disclose to the board of directors of Citizens Alliance that she had authorized over $1 million of Citizens Alliance’s funds to be used for Fumo’s personal benefit, then she would have been guilty of fraudulently violating the public and charitable purposes for which the Citizens Alliance was created.

All of which raises a simple question: if the basic facts alleged by the prosecutors are not in dispute, and the law says those basic facts constitute criminal conduct, why bother having a trial at all?

Fumo and Arnao are going to stand trial for weeks, possibly months, for two reasons, the first of which has already appeared throughout the hundreds of pages filed by the lawyers in this case, the second of which the defense lawyers would never admit in a million years, but which is a part of almost every criminal trial defense, particularly for white collar crimes.

The first reason Fumo and Arnao are going to trial is quite simple: every crime consists of two elements, actus reus and mens rea, a guilty act and a guilty mind. Here, while Fumo and Arnao may admit many of the criminal acts, neither admits ever having criminal intent. Both vehemently deny intending to rip off the Senate, Citizens Alliance, the Independent Seaport Museum, or the Internal Revenue Service. The burden thus falls on the United States Attorneys to prove, beyond a reasonable doubt, that Fumo and Arnao intended to defraud these entities.

In some cases, that distinction matters, such as when a fist fight turns deadly and the defendant claims that, while they intended to hit the victim, and are guilty of assault and battery, they did not intend to kill the victim. Other times, the distinction is silly, such as in the tax evasion case brought against Fumo’s investigator Howard J. Cain, who has admitted to not filing any income tax returns for years. Cain could claim he had no intent to evade his taxes, but no one would believe him.

It’s hard to say where Fumo’s case falls between those two ends of the spectrum, which means it probably falls towards the former. Most of the lawyers with whom I have spoken consider Fumo’s intent to be a no-brainer: of course he knew it was wrong to have Senate employees working on his mansion and of course both Fumo and Arnao knew it was wrong for Citizens Alliance to arbitrarily throw money at Fumo in the form of meals and vacuum cleaners. “They even called it OPM!” the lawyers exclaim, “Fumo’s toast.” Most of the non-lawyers with whom I have spoken, however, have recognized the ambiguity in the Senate rules, the absence of any specific restrictions on the roles of Senate employees, and the general principle that a non-profit can usually spend its money however it wants.

Which brings us to the second reason this case is going on trial: jury nullification. "Nullification occurs when a jury - based on its own sense of justice or fairness - refuses to follow the law and convict in a particular case even though the facts seem to allow no other conclusion but guilt." Honorable Jack B. Weinstein, Considering Jury "Nullification": When May and Should a Jury Reject the Law to Do Justice, 30 Am. Crim. L. Rev. 239, 239 (1993).

Jury nullification has represented the best and the worst of American history. In 1735, Andrew Hamilton urged a New York jury to ignore the law of England and to acquit Peter Zenger of criminally libeling the colonial governor of New York. Under the colonial law of England, truth was not a defense to criminal libel. Andrew Hamilton, drawing upon the same ideals that would later be embodied in the First Amendment to the United States Constitution, argued that, regardless of what the law and the judge said, Peter Zenger should be acquitted in the name of justice. He was.

Jury nullification was also used frequently in the Jim Crow South to thwart the prosecutions of Ku Klux Klan members and other whites who had intimidated, attacked, and murdered blacks. Emmett Till was but one example when an all-white jury completely disregarded largely undisputed facts and clear instructions from the judge to find criminals not guilty.

Juries tracing back to ancient times have, as they felt the circumstances warranted, exercised lenity against certain defendants by finding them guilty of fewer crimes than the evidence proved or handing out lesser sentences. But the supposed "right" to jury nullification was never truly recognized by English or American courts, and in 1895 the United States Supreme Court specifically prohibited the practice by upholding a trial judge’s instructions to a jury that, even if the jury believed a defendant on trial for murder deserved lenity and should be convicted only of manslaughter, that the jury had an obligation to convict that defendant of murder if the evidence established murder. Sparf v. United States, 156 U.S. 51 (1895).

Surprisingly, despite constant requests by criminal defense attorneys to argue nullification to juries continuing even to the present (and trial courts’ constant rulings prohibiting such arguments), the United States Supreme Court has not revisited the issue of jury nullification in nearly 100 years, despite an extensive overhaul of most of the legal ideology upon which the Sparf opinion was based.

But make no mistake: criminal defendants have no right to ask the jury for nullification, and defense lawyers who do so risk judicial sanction and even criminal conviction. United States v. Renfroe, 634 F. Supp. 1536 (W.D. Pa. 1986), aff'd without opinion by U.S. v. Renfroe, 806 F.2d 255 (3d Cir. Pa. 1986).

Yet, here we are today, with Fumo’s and Arnao’s attorneys effectively telling the jury – which is supposed to apply the law given to them by the court to the facts that the jury finds – that the judge has gotten the law all wrong. How can that be?

There are three answers to that question. First, the American legal system recognizes the inherent tension between the judge and the jury, permitting each to intrude upon the other’s domain (the jury intruding upon the law and the judge intruding upon the facts) where necessary to ensure justice is done. It is undeniable that, though a judge may remove a juror from the jury if the juror appears inclined to nullify the law, a judge also may not overturn a jury’s verdict of acquittal and re-try the defendant because of jury nullification. Gregg v. Georgia, 428 U.S. 153, 200 n.50 (1976) ("The suggestion that a jury's verdict of acquittal could be overturned and a defendant retried would run afoul of the Sixth Amendment jury-trial guarantee and the Double Jeopardy Clause of the Fifth Amendment."). These two principles cannot be reconciled. Their presence together represents a delicate balance necessary for a society in which justice is dispensed by the people, not the government, but in a fair and consistent manner across all trials.

Second, permitting judges to handcuff defense attorneys to only those arguments the judge decided were “factual” would vest extensive power in the judge, at the expense of the jury, power that would likely be exercised in an arbitrary manner no matter how good the judge’s intentions. Rarely can the law be applied to a set of facts with mathematical certainty. It’s thus frequently impossible to fully divorce “legal” arguments from “factual” arguments; attempting to do so would do little more than put a façade of logic and reason on an inherently indeterminable question.

Third, we simply cannot stop juries from nullifying verdicts. Permitting a judge to restrain defense lawyers’ arguments would thus seriously hinder the defendant’s right to present a defense without actually solving the nullification problem. Indeed, it could make the problem worse, by depriving the jurors, none of whom are lawyers, of any legal arguments at all, leaving them to rely entirely on their own experience to answer questions the lawyers could put in proper context.

And so we have the Fumo trial, in which twelve non-lawyers deliberately kept from their own research – kept even from discussing the case amongst themselves until deliberations – will decide the legal question of whether Fumo and Arnao’s largely undisputed conduct was criminal.

[edited to remove a truly embarrassing typo]

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It's no surprise that trial lawyers are often drawn to politics -- politics and trials both hinge on facts, credibility and persuasion, and both are swayed by similar strategies, tactics, persistence, diligence, insight and, unfortunately, fabrications and passions.

That is part of why, this blog, unlike most practicing attorney blogs, often jumps into politics. I believe politicians and political strategists have a lot to teach trial lawyers, or at least do a lot from which trial lawyers can learn.

Or re-learn.

Two months ago I made a prediction that I did not see made anywhere else: that Sarah Palin was announced as John McCain's vice presidential running mate as part of a bait-and-switch strategy designed to disrupt the election narrative (in which John McCain was slowly losing the election), shore up social conservative support for McCain, and change expectations for his running mate.

I had many reasons to reach that conclusion, some of which you can read at the link, but chief among them in my mind was how the selection didn't make any sense.

Sure, a number of pundits identified plausible reasons for the selection, including discontent among former Hillary Clinton supporters, but, long before the election, polls have consistently shown that most voters are both very concerned about electing a president over the age of 65 and uncomfortable with the idea of a female president. Add to those existing preconditions the fact that the McCain team had apparently done no vetting or other investigation of Palin, who had minimal experience, was under investigation for ethical violations, and had not shown any understanding of national politics, and you had, at least in my interpretation, a preponderance of evidence suggesting all was not as it appeared to be.

Put another way, had the vaunted Karl Rove political machine really chosen, without any detailed investigation, an unqualified candidate the voters were predisposed not to like? And had they done so while also conceding their strongest argument, that McCain's experience trumped Obama's vision?

Apparently so. I was wrong.

Here's how Newsweek's embedded reporters described it after the election:

Pawlenty, the popular governor of a swing state the Republicans badly needed to win in November, was the safe choice. Salter especially liked Pawlenty's salt-of-the-earth qualities.

But McCain didn't want the safe choice. A top adviser would later recall that telling McCain that Pawlenty was "safe" was "like guaranteeing" that McCain would not pick him. Prodded by Schmidt and Rick Davis, McCain began asking about Palin, a first-term governor who had shaken up the Alaska political establishment by taking on her own party elders, who was fearless and defiant, who was … a little bit like McCain.

There was no strategy: McCain, Schmidt and Davis were thinking, as Stephen Colbert would say, with their guts.

In one sense, there is no need for self-reflection, as the end result was the one I wanted, so does it really matter how we got there? Yet, every trial lawyer has had a trial end successfully but not in the way they imagined. After they fought hard, trapped the opposing party in their own contradictions, marshalled their strongest evidence and highlighted their opponent's weakest evidence, the trial lawyers interviewed the jury afterwards and discovered the case the jurors decided bore little resemblance to the case the lawyers argued.

Sure, all the facts were the same, but in the end the jurors took the issues the lawyers thought were, respectively, dispositive and tangential, and flipped them. That's as much as reason to re-evaluate how you tried the case than if you had lost it.

So it's time to re-learn a lesson taught best to me by my brother, the theoretical physicist and poker player, who a while back related to me this strategic mental exercise:

Q: It's early in a no-limit Texas Hold 'Em tournament.  The last cards you've played to showdown were pocket kings for a flopped set that turned a boat.  Since then you've folded every single hand for the last 45 minutes.  From early position, you open-raise to 4 times the big blind with about 45 blinds behind.  What is your opponent thinking?

A: Nothing.

Sometimes, your complicated feigns are irrelevant and your opponent isn't feigning anything at all.

Sometimes, they're just thinking from the gut.

Next time you ask yourself, "what are they thinking?", consider that the answer could be "nothing."

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Yikes:

WASHINGTON -- Juror No. 4 in Sen. Ted Stevens' federal corruption trial, otherwise known as Marian Hinnant, did not leave to attend her father's funeral in California, as she told the judge.

Instead, Hinnant had a plane ticket to see the Breeder's Cup at the Santa Anita race track and didn't want to miss it, she told the judge this morning, in what sounded like completely irrational and perhaps even delusional remarks.

...

Her lawyer, federal public defender A.J. Kramer, tried to keep her from saying much in court, telling the judge only that "her state of mind was such that she had to go to California."

"She apologizes to the court. In fact, her father did not die," Kramer said. "The story about her father was just one that popped into her head."

But Hinnant cut in, and in a thick Kentucky drawl, gave a rambling, incoherent and baffling monologue about her former employers in the horseracing industry in Kentucky. She mentioned drugs, wiretaps and horseracing, but made little sense.

"I'm not the one who was selling the drugs, I'm not the one who was doing the drugs," she said.

(Via TalkLeft)

What is there to say?

First, how did this woman get onto the jury in the first place? I have never seen a panel of more than 20 potential jurors that did not include at least one person who did not seem to be in the right mindset to serve. That is not to say that they were crazy or should have been institutionalized, but that they did not appear to be in a place where they could effectively apply their reason and intellect to the circumstances.

Some people are very candid about that -- some have just started medication, some are going through very tough times, and some freely admit they do not believe themselves competent to sit in the judgment of others. For others, though, usually lawyers on both sides are on the lookout for these types of jurors and will agree to strike them without much fanfare.

How this woman managed to get on the jury and serve all the way through, after examination by both sets of lawyers and the judge, is beyond me. It usually only takes a few minutes before some sort of "baffling monologue" reveals the situation.

Second, although the reports are not, to me, entirely clear, she was likely the cause of the initial acrimony during deliberations. Perhaps she was encouraged by the other jurors to leave.

Frankly, though it's disturbing to see another's fate in the hands of a "delusional" juror whose mind was at the horsetrack, I find the thought that she was pushed out of the jury comforting. One of the reasons we have jury trials is the hope that the combined reasoning of the group will exceed that of any individual or even the sum of the individuals, and it would not surprise me at all if the rest of the jury -- even before agreeing on a verdict -- had agreed that this juror was going to be a problem and needed to be removed from the deliberations. Indeed, maybe they were able to prevail upon her to remove herself.

Perhaps we will know more in time.

[ed: grammer]

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Quite unfair:

Like a parent telling two children to go work things out for themselves, the justices declined to resolve the The Great High Court Showdown of 2008 — Olson v. Larisa.

The Court’s refusal to resolve the spat left Rhode Island, its governor and the town council of Charlestown to choose who — Supreme Court novice Joseph Larisa, or veteran Ted Olson — will appear before the justices on Monday to argue Carcieri v. Kempthorne, an Indian land case.

Their decision? Olson, according to a report on Scotus blog. Larisa, who’s never argued before the High Court, will be left to watch as Olson takes the reins on a case that Larisa has reportedly spent the better part of a decade working on

It may make sense before a Supreme Court, particularly the Supreme Court, given the limited scope of the short argument and how they generally care not one whit about the facts or details of the case, but instead focus on more general legal and policy questions. Olson knows the Court, the Court knows him, so it may make sense to bring in a big name on the eve of the argument.

But don't ever do that on a trial. Not ever. Trials are different. Trials are unpredictable. Trials can turn on "minor" details and quick-thinking during direct or cross examination.

Maybe you'll get lucky. Maybe the case really is so simple that it comes down to a lawyer's experience in a particular field or in connecting with juries.

That, however, is the exception, not the rule. Trial preparation requires not just work but time. It cannot simply be crammed into the space of a week, a few days, or the first couple nights at trial. It's not enough to read and re-read all the depositions and pleadings and motions: you need to think about them.

This point is so important it's worth mixing metaphors: the facts need to marinate in your head, and your ideas need to germinate and flower so that they can percolate at the right time during the trial.

That cannot be done in a week. It reminds me of advice I read from a preacher (to fellow preachers) many years ago: the Lord reveals far more in a month than He does in a day.

Combine that with Sun Tzu's Art of War: every battle is won or lost before it's ever fought.

And we have our motto: every trial is either won in the months, or lost in the days, before it's ever tried.

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As you've heard, even given that rock you've been living under, after President Bush, John McCain, and the Republican and the Democratic leadership of the House announced that an agreement had been reached, the actual vote on it failed, with a caucus of Republican conservatives bailing out on the bailout at the last minute, nominally because their feelings were hurt by Nancy Pelosi's speech. (Realistically, because they and their constituents hated it, and no one wants to run for re-election on an issue like that.)

So who is to blame? Treasury Secretary Paulson and Federal Reserve Chairman Bernanke. Those two idiots violated two basic rules of salesmanship and trial advocacy: do not ask for too much and do not surprise someone who has the option of walking away.

Soon after those idiots dropped a basket of rotting fruit on Congress (which they described as a basket of roses), a spokesman admitted a stupefying fact — the administration had prepared the three-page bill months ago and nonetheless decided not to let Congress or the American people in on the possibility until they believed we were all on the verge of a new depression. Such was in sharp contrast to the Fannie Mae and Freddie Mac bailout, which were deliberated by and authorized by Congress well in advance of the actual need.

It's hard not to sympathize with the House Republican caucus, whose own Administration left them out of the loop of the most expensive act ever introduced in Congress, the principal point of which was to violate several principles stated in the Republican Party platform.

The application to trial advocacy is not hard to understand: if you have a hard sell coming up, get to work early and be prepared to take on some water.

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Over at PhilaLawyer, an anonymous (and largely humor-focused) part of the Rudius blog network, there are four ideas for "Shyster-Proofing the Courts:"

1. Immediate Mandatory Mediation
2. Allow Expert Witnesses to be Deposed
3. Give Frivolous Litigation Claims Teeth and Allow Expert Witnesses to Be Sued in Such Claims
4. Eliminate Referral Fees

First, let's keep something important in mind: the bulk of civil cases involve automobile accidents. So in some sense we're really missing the boat unless we're talking about that specifically. That said, I doubt any of these would make a difference.

1. Immediate Mandatory Mediation

Because I work on a contingent fee, I would like nothing better than to settle cases as quickly as possible.. Settlement puts money in my pocket, does not require my own money put out on the street for costs and fees, and puts my client back on their feet, a particular concern in personal injury and medical malpractice cases. So don't think I am ever the one driving the litigation.

Problem is, even a hypothetically perfect insurance company that promptly and fairly evaluates every claim, sets an appropriate reserve, and begins negotiation has multiple incentives not to settle early. The insurance company makes a return on every single penny in their reserves, a return that evaporates the moment they tender a check to me. The insurance company also typically starts blind on damages; they know a lot about their insured's liability, but very little about my client's medical expenses, lost wages, and the impact the injury has had on their life, and for obvious reasons the insurance company is not going to take my word for any of them. Finally, the insurance does not know how highly I really value the case. The only way they believe they can estimate my bottomline is by pushing back against me and seeing how I respond. Even at a firm with a strong reputation for taking cases to trial and for rejecting weaker (even though meritorious) cases, there is still a belief among insurers and defense counsel that some of the cases are "nuisance value" cases taken to maintain cash flow, with little expectation of a substantial settlement or verdict.

In the real world, the above analysis does not even happen at the insurance company until the case is ready for trial. The insurance adjuster, who, as a cog in a bureacracy, has the primary goal of demonstrating their usefulness to the bureaucracy by creating an extensive paper trail, frequently does not even bother to set a reserve for the case until trial schedules have been finalized. Similarly, the defense attorney, who gets paid by the 10th of the hour they spend defending the case, has little incentive to encourage a swift resolution of the case, thereby extinguishing a source of income and appearing feckless in the face of controversy.

Thus, by and large early mandatory mediation conferences will function as a subsidy for defense lawyers — by giving them something else to bill for — and a tax on plaintiff's lawyers — by taking them away from their other contingent fee cases. At the conference, the defense attorney will have authority only for a nuisance value while the plaintiff's attorney (who will be a junior associate, if the firm has them) will have authority only for the highest number the plaintiff's attorney can reasonably demand. If there is some external force which could drive early settlement, that force will do so regardless of court intervention.

2. Allow Expert Witnesses to be Deposed

That's already the case in the federal system. While it probably does reduce the need for trial because it puts almost everything on the table, it won't do anything to cut back on litigation. The point about having experts who write bogus opinions expecting a case will never go to trial is well taken, but that's already factored into our current system — if one of the sides thinks the expert will pull out the event at trial, they'll just push the case straight to trial, extracting a favorable settlement while teaching the other side a lesson. Adding a deposition, which would naturally have to occur after discovery (as it does in the federal system), won't really change that dynamic, it just slightly advances the time when the expert pulls out. There might be some savings to that, since it obviates the need for full trial preparation, but those savings would be minimal.

I don't think expert witness depositions are a bad idea, I just don't think they will result in any significant savings. Moreover, in cases worth less than, say, $100,000, expert witness depositions could have the perverse effect of making settlement less likely, because they hike up the costs of bringing the case to trial, thereby requiring the plaintiff and their attorney to raise the demand accordingly to protect the amount they get in the end, which in turn makes it less likely the insurer will meet the demand.

3. Give Frivolous Litigation Claims Teeth and Allow Expert Witnesses to Be Sued in Such Claims

Frivolous lawsuits are already actionable in most states, and are frequently acted upon right here in Philadelphia County. In Pennsylvania, there is specific statutory authorization for them under the so-called Dragonetti Act, named after the first attorney to get really walloped under it. The elements of such a wrongful use of civil proceedings suit seem reasonable to me:

§ 8351.  Wrongful use of civil proceedings

(a) ELEMENTS OF ACTION.-- A person who takes part in the procurement, initiation or continuation of civil proceedings against another is subject to liability to the other for wrongful use of civil proceedings:
 
   (1) He acts in a grossly negligent manner or without probable cause and
   primarily for a purpose other than that of securing the proper
   discovery, joinder of parties or adjudication of the claim in which the
   proceedings are based; and
 
   (2) The proceedings have terminated in favor of the person against whom
   they are brought.

...

§ 8352.  Existence of probable cause

A person who takes part in the procurement, initiation or continuation of civil proceedings against another has probable cause for doing so if he reasonably believes in the existence of the facts upon which the claim is based, and either:
 
   (1) Reasonably believes that under those facts the claim may be valid
   under the existing or developing law;
 
   (2) Believes to this effect in reliance upon the advice of counsel,
   sought in good faith and given after full disclosure of all relevant
   facts within his knowledge and information; or
 
   (3) Believes as an attorney of record, in good faith that his
   procurement, initiation or continuation of a civil cause is not
   intended to merely harass or maliciously injure the opposite party.

42 Pa.C.S. § 8351 et seq.
 

If there is a way to improve these elements, I would love to hear it. I personally can't think of any way of strengthening it without making it, at best, confusing and, at worst, a violation of the rights of due process and access to the courts.

As for moving against experts, there is always perjury. Beyond that, it's hard to imagine a worse idea than intimidating witnesses not to say what they really think. The point about this honest experts is, again, well taken, and I have tangled with my fair share of them, but such annoyances must be balanced against minor concerns like truth, justice and fairness. The best you can do now to retaliate against a lying expert is to report them to whatever professional organization of which they are a member, which hopefully have a deterrent effect against future offenders. I am loath to really encourage that idea, though, because by and large professional associations have a serious pro-defense bias, the natural result of a (perhaps understandable) desire to protect and shield their members from liability.

4. Eliminate Referral Fees

I have no idea how that would help anything. Plaintiffs lawyers bill on a contingent fee; if the case is meritless, they're a waste of time and money to pursue. Indeed, referral fees in my opinion actually reduce the number of cases filed, because they cut into the fee earned by the attorney actually pursuing the matter, thus requiring the case be stronger and have larger damages than if the case been brought in directly. Moreover, if there really is a problem of "recidivist professional plaintiffs," what good would it do to eliminate referral fees? They'll simply go to the same attorneys over and over or they'll find attorneys on their own — they're among the few people who really can find the right attorney for them on their own.

More importantly, referral fees serve a critical purpose in the civil justice system, introducing economic efficiency to an ordinarily inefficient process: the selection of a personal injury attorney by a nonlawyer. Corporate lawyers and clients don't need anything like a referral system because, as part of their paying jobs, they interact with all kinds of attorneys and generally have connections that can set them up with the right person for the job.

Your typical Wal-Mart or Wawa cashier hasn't the faintest clue about what to do when they get paralyzed by a drunk truck driver or when their spouse's brain gets blown out by an overdose of Heparin. Most lawyers don't even know to whom they'd turn in the event of a catastrophic injury. The referral system creates an incentive for the initial attorneys not just to half-assedly send a case away, but to diligently choose an appropriate attorney who can get the best result for the client.

Finally, and to me this is the most important function of the referral system, referral fees — specifically large referral fees — encourage attorneys who are not really qualified to handle large matters to refer those matters out to attorneys who are qualified. I cannot tell you the number of times I have been referred a case either because "it's just too big for me" or because "after I filed suit, the defense attorneys went nuclear on me." That is a good thing; attorneys should have no hesitation to radio SOS when the waters get rough. Eliminating referral fees gives them an incentive to hold on to these cases and "do their best," which is frequently not in the client's best interest.

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Not Exactly Rocket Science fills us in on a recent Italian study revealing the unconscious decision-making of "undecided" voters:

Silvia Galdi at the University of Padova, Italy, has found evidence that the final verdicts of undecided decision-makers are only weakly related to their conscious preferences and more strongly influenced by unconscious views and biases they aren't aware of. In many cases, when people claim that they are undecided, they have secretly made up our minds, unbeknownst even to themselves.

...

All the interviewees returned to repeat the tests one week later. Among those who were previously undecided about the base, Galdi found that their conscious beliefs had little bearing on their later choices. Instead, it was their unconscious biases that had the greater influence; they predicted which way the interviewees' decisions would swing a week later, as well as any changes in direction in their conscious beliefs.

The tests show that the unconscious beliefs of these swing-voters were influential enough to sway their future decisions. Even though they said (and most probably believed) that they were undecided, they had to some extent already made up their minds.

People who had already made up their minds behaved differently. In their brains, unconscious associations held little sway and it was their conscious reasons that predicted their future choices. In fact, these reasons even predicted any changes in their unconscious associations - their beliefs were strong enough that over time, they eventually strengthened into a sort of mental reflex.

Perhaps most importantly, once the "undecided" voters had been pushed to a decision by their implicit biases, they cogently rationalized the decisions to themselves, essentially creating post hoc rationalizations for ideas long-decided for them.

As a trial lawyer you can read this simplistically as, "some jurors are just plain biased," but that's far more common in criminal trials than civil trials. In civil trials, while jurors may lean one way or another, they don't know you or the defendant from Adam, Eve or the Three Stooges.

Based on the above, there are only three things you must do:

1. use voir dire to discover jurors with harmful implicit biases, and exclude them;
2. put forth compelling arguments to arm favorable and undecided jurors in deliberations;
3. disarm unfavorable and undecided jurors from relying on the defendant's arguments.

Hopefully, you'll end up with a largely unbiased jury that has the power to rationally decide in your favor and doesn't have the ability to irrationally decide against you.

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Congratulations, Paul:

The estate of legendary sports announcer John Facenda has scored another major victory in its court battle with NFL Films that centers on whether Facenda's distinctive voice -- known in football circles as the "Voice of God" -- was improperly used in a promotional film for a John Madden video game.

In its 60-page opinion in Facenda v. NFL Films Inc., a unanimous three-judge panel of the 3rd U.S. Circuit Court of Appeals ruled Tuesday that NFL Films violated Pennsylvania's "right of publicity" statute.

Now the only issue left to be decided on that claim is how much Facenda's estate should be awarded in damages.

The panel rejected NFL Films' argument that the "standard release" contract Facenda signed was a "complete defense," noting that while the release gave the NFL the right to use Facenda's voice in future film projects, it also explicitly prohibited any use that would "constitute an endorsement" of any product.

"Facenda consented to participation in films documenting NFL games, not an advertisement for a football video game," 3rd Circuit Judge Thomas L. Ambro wrote in an opinion joined by Judges Michael A. Chagares and Robert E. Cowen.

...

The NFL's lawyer, Bruce P. Keller of Debevoise & Plimpton in New York, argued that the 22-minute film, titled "The Making of Madden," was a documentary and was therefore a work of artistic expression entitled to First Amendment protection.

But Paul A. Lauricella of The Beasley Firm, who represented John Facenda Jr., argued that the film was nothing more than an "infomercial" for the video game "Madden NFL 06," and was therefore purely commercial speech.

In the lower court, Hart sided with Lauricella and concluded that the film was not a documentary because it "lacks the journalistic independence typical of the maker of a documentary" and because NFL Films had a "direct financial interest" in the success of the video game.

Ambro agreed with Hart, saying "like an infomercial, the program focuses on one product, explaining both how it works and the source of its innovations, all in a positive tone."

As a result, Ambro concluded that the NFL's First Amendment defense failed.

Although "commercial speech does receive some First Amendment protection," Ambro said, the Lanham Act "customarily avoids violating the First Amendment, in part by enforcing a trademark only when consumers are likely to be misled or confused by the alleged infringer's use," he wrote.

Opinion's worth the read if you're in the copyright, right of publicity, or misleading advertising fields. The NFL ran the full gambit of defenses, from preemption to "actual confusion," and lost on all of them.*

* Technically, the Third Circuit moved one issue back from summary judgment to the jury. Here in plaintiff's land, when something goes to the jury, we call it a win.

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The "Truck Injury Lawyer Blog" points us to a new development in the world of trucking accidents:

In his recent article, Premiums Fall 10% to 50% As New Firms Enter Market, Frederick Kiel describes the effect that the drop in premiums has on the trucking companies, as these new insurance companies are offering across the board rates to trucking companies in an effort to compete for their business. ...

These new insurance companies are offering low premiums in an effort to gain new business, a trend that has been seen intermittently since the 1980s. Perhaps now is the time to look at the minimum insurance required to be carried by tractor trailer companies. Congress set the minimum rates back in 1984 at $750,000 for some companies with most being required to carry $1,000,000. Inflation and time have eroded the value of the coverage. Medical bills and the costs associated with catastrophic injuries have risen dramatically. Today, in a catastrophic case, the minimum limits are paid and quickly spent. The injured are then left for the taxpayer to pay for through medicaid or some other assistance program.

$1 million frequently will not cover the damages in a catastrophic personal injury case, particularly not where there will be extensive continuing medical treatment. $1 million also frequently does not cover wrongful death damages, and it usually will not cover an accident where multiple people have catastrophic injuries.

although the article does not address it, an important point to keep in mind here is how much safer trucking these days should be given the depth and breadth real-time monitoring available to trucking companies. Traffic, weather, and driver alertness -- down to excruciatingly minor details -- are all readily apparent in real-time to fleet managers, thereby eliminating the bulk of the systematic risks faced by truckers that cause major motor vehicle accidents.

If trucking companies used this technology appropriately -- rather than using it solely to run their drivers right up to (and frequently beyond) the Federal Motor Carrier Safety Regulation limits -- and purchased adequate insurance, including insurance with coverage for each plaintiff, rather than the accident as a whole, the costs and financial risk of trucking would be dramatically reduced.

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Sometimes I read Kevin, M.D. out of what I can only assume is a hidden desire to gnash my teeth thinking about medical malpractice:

Massachusetts is allowing a new form of malpractice lawsuit to go forward:

A woman wrecked her car, killing an innocent bystander. Now the bystander’s widow is suing the woman’s doctors, arguing that they should have warned her not to drive while taking the pain medicines they prescribed.

The problem is, a majority of medications can lead to lightheadedness and dizziness, which in theory, can impair the ability to drive. Blood pressure and diabetes drugs for instance. Should patients taking these medications be warned not to drive?

At the very least, I would be very wary of prescribing any form of narcotic medications if these types lawsuits were to succeed. Patients lose again.

I'll put aside the assertion that "a majority of medications" are at issue; I imagine he wrote that as a throw-away line.

On to the merits, it's interesting that Kevin does not attack the nominal "problem" with the ruling, in that it creates the right of third parties to sue physicians where the physician was negligent in their treatment of a patient and that negligence injured the third party. That's what all the doctors in Massachusetts were freaking out about. So we'll leave that to another day.

Instead, he apparently frets that physicians should not be held liable where they failed to warn patients about the risks of the medications they are prescribing.

Why not? Is it really so hard to hand a patient a brochure or to talk over the risks on the package with them? Is it really so terrible if the standard of care requires a physician listen to their patient and, upon hearing an elderly woman say she feels faint while driving, suggest she stop driving?

The practical answer most physicians would give is that of course they want to take the time to discuss every detail of the medication they are prescribing to their patients, but they simply can't. If they did that, they wouldn't make nearly enough money to support their practice.

That's not a complaint about medical malpractice, trial lawyers, or torts. It's a complaint about insurance reimbursements, which encourage doctors to treat patient visits like speed dating.

So stop blaming us.

* gnashes teeth *

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As mentioned yesterday, a jury awarded Mattel $100 million* for the Bratz infringement, one-twentieth of the $2 billion requested in their closing argument, just over three times the $30 million suggested by MGA (and which may be reduced to $40 million, discussed below).

* see end of post, damages are apparently only $20 million due to duplication on verdict sheet

What happened? Mattel misjudged the jury's outrage and overshot.

Here's the jury's breakdown:

The jury awarded damages of $20 million against MGA and $10 million against [MGA CEO] Larian in each of three causes of action, intentional interference with contractual relations, aiding and abetting breach of fiduciary duty, and aiding and abetting breach of the duty of loyalty.

They also found that MGA owed Mattel $6 million for copyright infringement, while Larian owed $3 million in distributions he'd received from Bratz-related sales, and MGA Hong Kong owed $1 million.

Here is what each side claimed:

Quinn said MGA owed Mattel for the entire Bratz empire, amounting to at least $1 billion in Bratz profits and interest. Quinn argued that Larian, too, personally gained nearly $800 million in stock value and distributions flowing from the success of the dolls.

...

MGA attorneys countered that the jury should award Mattel as little as $30 million because the company had built the doll line's value with smart additions, branding and packaging.

(emphasis added) And here's a critical fact:

The four original dolls made just $4 million in profit their first year and comprised only 2.5% of MGA's entire Bratz revenue, said Raoul Kennedy, one of MGA's attorneys.

In the past seven years, MGA has built the popular brand to include more than 40 characters and expanded it with spin-offs such as Bratz Babyz, Bratz Petz, Bratz Boyz and items like helmets, backpacks and bedsheets.

(emphasis added) Recall that excellent Learned Hand quote unearthed by the Eleventh Circuit (and discussed in my post on the Watchmen lawsuit:

It must be obvious to every one familiar with equitable principles that it is inequitable for the owner of a copyright, with full notice of an intended infringement, to stand inactive while the proposed infringer spends large sums of money in its exploitation, and to intervene only when his speculation has proved a success. Delay under such circumstances allows the owner to speculate without risk with the other's money; he cannot possibly lose, and he may win.

I don't believe the Bratz trial addressed laches and the suit was somewhat timely filed from what I can tell, perhaps two years after the infringement was discovered. I doubt any of the jurors were familiar with Learned Hand, but the core idea is well-accepted in America: expanding upon others' ideas is a legitimate enterprize.

The jury essentially found that MGA was entitled to 95% of the Bratz empire's profits, despite accepting that:

• the original idea was wrongfully lifted from Mattel;
• MGA willfully interfered with Mattel's business;
• MGA aided and abetting in breaches of fiduciary duties;
• MGA aided and abetting in breaches of the duty of loyalty duties.

Despite that, the jury accepted MGA's proposed $30 million and then, perhaps as a deliberations compromise or perhaps in confusion, awarded it thrice. That alone presents a big problem for Mattel, as it's possible the judge will strike two of the three $30 million awards as duplicative, resulting in a $40 million final verdict.

After, say, a 40% gross contingency fee (which is probably on the high end, given the massive damages both Mattel and Quinn thought they could get, but which is common in commercial and business litigation) and costs, that would leave Mattel with about $20-24 million, or less than 5% of their annual profit. Yikes.

For MGA's greedy, unjustified, wrongful conduct, the jury awarded $0 in punitive damages and a fraction of the plaintiff's proposed compensatory damages. What the heck happened?

I'm not in a position to question the tactical decisions of Mattel's counsel, so I won't. With the benefit of hindsight, though, I believe Mattel dramatically overshot. It's indisputable that MGA did virtually all of the work and invested virtually all of the funds that made Bratz the success it is today. They didn't start the fire, but they gathered all the wood, they sheltered it from the rain, and they used it to kindle others. Yet, Mattel claimed it was entitled to everything, that for MGA's risk it should be granted all the reward.

There were three elements missing, at least two of which are essential for a large verdict:

1. fairness,
2. the absence of a windfall, and
3. outrage.

First, jurors try very hard to be fair. What Mattel proposed was not fair. Sure, Mattel may be entitled to it under the law, and it was unfair that their design was stolen. But it's just as unfair to all the people at MGA who didn't know they were working with stolen goods, and, indeed, it's unfair to the infringing parties themselves, since it denies their own contribution to the final work.

Second, jurors don't like to give money for nothing. Mattel proposed a windfall. Why should they get all the profits? Mattel did almost nothing to earn those profits, it just had some design sketchs stolen. Big whoop -- for that you get an entire empire that someone else built?

Third, If the jury had been outraged by MGA's conduct, "fairness" would have already been decided in the plaintiff's favor, and the windfall would have mattered less. But they weren't outraged; they thought it was an unjustified way to do business, but obviously not enough to warrant punishment.

And here's where I think Mattel made its biggest mistake: Mattel only asked for a number, while MGA gave them the tools to reach their own decision in a way that was favorable to MGA. How do I know the jury used MGA's tools? Look at the numbers they used, right out of MGA's closing: $30 million, around 2.5% of $1 billion in Bratz profit.

It can't be said enough: in closing arguments, arm your jurors with the arguments they need to prevail over the others in liability and the tools they need to reach your proposed award.

Either way, MGA is breathing a deep sign of relief today. And Mattel is digging deeply through the transcript to find something warranting a retrial.

UPDATE: MGA has been pushing heavily in the press that it's apparently undisputed the damages were overlapping, so the final sum really is just $20 million. Which means the jury took Mattel's damages instructions almost verbatim. I have cleaned up slightly (typo) and moved the old discussion of that issue below the fold, to keep around for posterity, and pasted the MGA press release.

OLD DISCUSSION

Indeed, it looks like the jury entered deliberations with barely any tools to work with, considering that the meaning of the verdict slip is already in dispute. The jury awarded exactly $30 million thrice on parallel claims. That doesn't make any sense: if the jury thought the damages were really $30 million, which they clearly did, but wanted to punish MGA, they had a punitive damages element readily available. If the jury thought $90 million was the damage, they likely would have apportioned it across the entites in relation to their involvement.

MGA PRESS RELEASE

LOS ANGELES--(BUSINESS WIRE)--In light of the verdict in MGA Entertainment’s trial against Mattel, MGA today said that certain media reports regarding the damages awarded in the trial are inaccurate.

The jury awarded $20 million to Mattel in damages. Some media reports have incorrectly reported that Mattel was awarded $100 million.

MGA said that the jury made its award pursuant to a variety of legal claims, each based on the same damages theory, and subject to the Court's instruction not to be concerned about duplicative damages. MGA pointed out that during the trial Mattel even conceded that the damages it sought were overlapping and duplicative.

MGA further stated that it intends to appeal any amount of awarded damages at the end of the case.

“We are pleased to have this trial behind us,” said Isaac Larian, CEO of MGA Entertainment. “We can now concentrate all of our energies on what we do best - providing dolls and other toys that are the consumers’ first choice.”

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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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Justice Scalia doesn't think so:

I do not believe that legal writing exists. That is to say, I do not believe it exists as a separate genre of writing. Rather, I think legal writing belongs to that large, undifferentiated, unglamorous category of writing known as nonfiction prose. Someone who is a good legal writer would, but for the need to master a different substantive subject, be an equivalently good writer of history, economics or, indeed, theology.

(caught by the (new) legal writer).

Interesting position, since the man recently released a book on persuading judges. Here's part of the book's description:

Making Your Case: The Art of Persuading Judges is a guide for novice and experienced litigators alike. It covers the essentials of sound legal reasoning, including how to develop the syllogism that underlies any argument. From there the authors explain the art of brief-writing, especially what to include and what to omit, so that you can induce the judge to focus closely on your arguments. Finally, they show what it takes to succeed in oral argument.

Do the essentials of sound legal reasoning apply equally well to history, economics and theology? Should a historical argument -- an argument that a particular set of facts existed  -- revolve around a syllogism the same way a legal argument -- an argument in favor of applying particular philosophical and logical principles -- usually must?

Some principles of nonfiction writing are universal, like brevity, rhythm, and structure, but to say the principles of good legal arguments are equally applicable to other (particularly non-adversarial) disciplines is a gross overgeneralization. Even Socrates felt uncomfortable using his lifetime of philosophy and logic to make a legal argument:

And I must beg of you to grant me one favor, which is this—if you hear me using the same words in my defence which I have been in the habit of using, and which most of you may have heard in the agora, and at the tables of the money-changers, or anywhere else, I would ask you not to be surprised at this, and not to interrupt me. For I am more than seventy years of age, and this is the first time that I have ever appeared in a court of law, and I am quite a stranger to the ways of the place; and therefore I would have you regard me as if I were really a stranger, whom you would excuse if he spoke in his native tongue, and after the fashion of his country: that I think is not an unfair request. Never mind the manner, which may or may not be good; but think only of the justice of my cause, and give heed to that: let the judge decide justly and the speaker speak truly.

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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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Victoria Pynchon has responded to my question about getting parties to the settlement table pre-trial, although she hasn't had a chance to answer it fully since she apparently has a real job outside of blogging.

While we're waiting, I do want to address the study (to be published in the Journal of Empirical Legal Studies, covered by the New York Times) that originally prompted her post.

Here's the punchline:

Defendants made the wrong decision by proceeding to trial far less often, in 24 percent of cases, according to the study; plaintiffs were wrong in 61 percent of cases. In just 15 percent of cases, both sides were right to go to trial — meaning that the defendant paid less than the plaintiff had wanted but the plaintiff got more than the defendant had offered.

...

On average, getting it wrong cost plaintiffs at about $43,000; the total could be more because information on legal costs was not available in every case. For defendants, who were less often wrong about going to trial, the cost was much greater: $1.1 million.

First, a caveat: I haven't seen the study, and I am always wary of commenting on the way a study was reported, which usually differs greatly from the study and its results, even with the best of reporting. Further, based on what I can gleam from the article, the authors may have conflated too many types of disparate cases together -- few trial lawyers would say that soft-tissue automobile accident cases are litigated, tried or settled the same way as wrongful death medical malpractice suits -- so the data may not be as useful as the article claims. 

That said, I think many of the conclusions around the blogosphere (e.g., "Settlement is Better than Trial") are off the mark, given what we know.

Based on those numbers before, plaintiffs should always take big cases to trial. Here's why:

The numbers show that, 61% of the time, plaintiffs get less at trial than they were offered. 24% of the time, they get more. Ergo, if you take a case to trial, the odds roughly 3 to 1 that you'll do worse for it.

But look at the difference in the money! 3 out of 4 times, a plaintiff loses on average $43,000 by going to trial. 1 out of 4 times, a plaintiff gains on average $1.14 million!

Thus, every single "win" cancels out a whopping 26.5 "losses!" Yet, based on the data above, as a plaintiff you don't "lose" 25 out of 26 cases, you "lose" 3 out of 4 (keep in mind that we've excluded the 15% of cases were both sides were right to go to trial).

The expected value / expected return for choosing trial over settlement is a whopping $1.01 million!

Based on those numbers, why on earth would I ever settle anything again?

Let me conclude: I'm assuming, as noted above, the study was either misreported or in fact jumbled disparate or outlying data together. Based on what we have, though, settlement is never the right choice unless you get every penny you've demanded.

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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 The Legal Intelligencer:

In a ruling that could have far-reaching effects on the handling of high-profile trials, the 3rd U.S. Circuit Court of Appeals ruled Friday that the media has a presumptive right of access to the names of jurors, and that a Pittsburgh federal judge erred when he sought to empanel an anonymous jury in the corruption trial of former Allegheny County coroner Cyril H. Wecht.

"The prospect that the press might publish background stories about the jurors is not a legally sufficient reason to withhold the jurors' names from the public. Although such stories might make some jurors less willing to serve or more distracted from the case, this is a necessary cost of the openness of the judicial process," 3rd Circuit Judge D. Brooks Smith wrote in United States v. Wecht.

The court's 118-page decision included a lengthy dissent by Senior 3rd Circuit Judge Franklin S. Van Antwerpen that said the ruling "effectively creates a new constitutional right" and "sets a precedent of permitting our court to micro-manage trial procedures established by the district courts."

Van Antwerpen complained that "requiring district courts to bow to media demands to know the names of prospective jurors would certainly impair the public good in many cases."

Frankly, I don't think this ruling is a big deal, for two reasons.

First, jurors generally know if they're going to serve in a high profile case. If they did not already know it was a big case, the lawyers will almost always tell them during voir dire. Maybe the plaintiff's lawyer mentions it because they think juries award bigger numbers in "big" cases; maybe the defense attorney mentions it because they think that jurors pay more attention in "important" cases.

If a juror has a problem serving in an high-profile case, they'll find a way out. Usually the problem is the opposite: too many jurors want to serve on a high-profile case so they can later give an interview or, in rare cases, write a book.

Second, I don't believe that "the public" or "the media" has a big influence on juror's decisions. Spouses have a big influence. Friends and coworkers have a big influence. When reaching a decision in a high profile case, most jurors don't worry about what some morning commuter who skims over their name will think about the verdict they rendered, they worry -- agonize -- over what they will tell people they know, who will all know the details of the case whether it's high profile or not.

Slightly increasing the likelihood that a newspaper will reveal their name, which I still consider a slim possibility unless the juror consents, won't change that dynamic.

 

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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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One of the few constants I have found across all trial is: the jury will take any opportunity to make fun of the lawyers, the parties, and the judge, in that order.

Understand that and embrace it. At the five-week trial, jurors referred to me and my co-counsel as "Batman and Robin" and to the primary opposing attorney as "Mr. Burns." Sometimes it's playful, and sometimes not. Know and prepare for the difference.

Most importantly, you want to avoid having your big, flashy centerpiece become an object of mockery and ridicule.

Take, for example, the latest Iranian missile test, revealed to have been altered to include an extra missile.

Here's what has happened to their big, flashy centerpiece:

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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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A common trial / public speaking question: what do I do with my hands? How do I keep them out of my pockets or keep from waving them around?

Give them something to do. If you can't think of a persuasive use of them, then give them the job of lightly touching your pants. Then they won't move.

Most of all, make sure they, and the rest of your body, emphasize your message, and do not distract from it. Like so:

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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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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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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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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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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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That's my interpretation anyway. From the always-great Deliberations:

I love the bumper sticker question in voir dire.  I've met lawyers and seen journalists who are surprised by it, or think it's intrusive, but when you think about it, it's a no-brainer.  If a juror holds an attitude so strongly that she'll paste it onto her car, you want to know what that attitude is.

New research suggests you should be interested in something else, too.  It isn't simply what jurors' bumper stickers say, it's whether jurors have bumper stickers at all.   Writing in the June issue of the Journal of Applied Social Psychology, Colorado State University researchers suggest that people with bumper stickers are more likely to be aggressive and angry people, or at least aggressive and angry drivers.

It even applies to people with 'peaceful' or otherwise conciliatory bumper stickers. I think that's a no-brainer as well --  if a person is of the type to broadcast their opinions to complete strangers, even where there's no dialog in return, you can assume they are also generally assertive, the type of people that will lead (or wreck) a jury.

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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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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, people and businesses who have been harmed by someone else. My practice is unlimited: at any given time, I generally have multiple cases representing people who have been physically injured by accidents or medical malpractice, and multiple cases representing people and businesses who have been financially injured through breaches of contract, breaches of fiduciary duty, unfair competition, or downright fraud. I represent most of my clients on a contingent fee basis.

If you'd like to know about The Beasley Firm's services in general, please visit my Services page or visit The Beasley Firm's Areas of Expertise. Our cases are typically in the Pennsylvania, New Jersey and Delaware counties near Philadelphia, with some cases in Washington, DC and New York City.

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, false claims, 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, and private military contractors. He has also taken on the City of Philadelphia, the Commonwealth of Pennsylvania, and the United States government.

Max is frequently retained to investigate potential claims and recommend litigation or ways to avoid litigation, to resolve complex issues of law that arise in litigation, and to simplify complicated facts at trial. In that capacity, he has tackled issues as diverse as the scope of government contractor immunities, the specificity required for title insurance exceptions, the meaning of pre-revolutionary state constitutional provisions, the calculation of shareholder damages in speculative ventures, and the obligations attorneys have to their former clients.

He has convinced opposing attorneys to withdraw on the eve of trial, has prevailed over assertions of client-attorney privilege, peer review protection, and trade secret confidentiality, and has prosecuted multiple simultaneous actions against the same defendants in different forums. He has also successfully defended suits alleging a wide variety of claims, from breach of contract to fraud to wrongful use of civil proceedings.

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 participated 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. Knowledge is power!


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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