Class actions of the lawyers, by the lawyers, for the lawyers? To quote the Law.com summary: “A federal judge has rejected a proposed co-lead plaintiff for the Monster Worldwide securities fraud class action because the representative knew nothing about the case. Southern District of New York Judge Jed Rakoff had some pointed words for lead plaintiffs counsel Labaton Sucharow, saying the Steamship Trade Association International Longshoremen’s Pension Fund was ’simply the willing pawn of counsel’ because it ‘has no interest in, genuine knowledge of, and/or meaningful involvement in this case.’” Judge Rakoff noted that pension fund co-chairman Horace Alston had represented himself under oath as the fund’s most knowledgeable person about the suit. “However, Mr. Alston then testified that he did not know the name of the stock at issue in this case, did not know the name of either individual defendant, did not know whether STA-ILA ever owned Monster stock, did not know if an amended complaint had been filed, did not know whether he had ever seen any complaint in the action,” leading Judge Rakoff to declare that he would “not be party to a sham.” (Mark Hamblett, “Lead Plaintiff Pick Rejected as Merely ‘Pawn of Counsel’”, New York Law Journal, Jul. 17).

Melbourne Mills’s defense that he was too drunk to know what was going on when he and two other attorneys stole tens of millions of dollars appears to have created reasonable doubt in the mind of a Kentucky jury.  Mills may have been helped by the revelation that his two co-counsel tried to hide $50 million from him, too, permitting his attorney to more plausibly blame the scheme on others.   Or the jury may have believed the argument of Mills’s attorney that the three attorneys were too stupid to understand the settlement agreement and didn’t intend to steal any money (though they transferred a lot of money from their personal account to their clients when they learned the bar was investigating, and lied to the bar about how much money their clients received).  (Jim Hannah, “One cleared in diet drug case”, Cincinnati Enquirer, Jul. 2; Beth Musgrave, “Fen-phen lawyer Mills is found not guilty”, Lexington Herald-Leader, Jul. 2; Beth Musgrave, “Jury hears closing arguments in fen-phen trial”, Lexington Herald-Leader, Jun. 24; AP/Kentucky Post, Jun. 23).  The jury, today in its seventh day of deliberations, claims a deadlock on the other two attorneys, no doubt confused by why Judge Jay Bamberger and co-counsel and Democratic bigwig Stanley Chesley have not also been indicted. Defendants Cunningham and Gallion have sought to blame the tens of millions they stole on the fact that Bamberger (who was indirectly paid millions) judicially approved the settlement and Chesley (who was directly paid tens of millions) was allegedly the architect of the settlement that ensured lawyers would get far more than their contracts with their clients provided. Since there is no dispute that those two were indeed intimately involved in the scheme, the jury isn’t the only one confused why the Kentucky fen-phen three are being treated differently than the judge, the judge’s former law partner, and Stan Chesley, who all profited mightily.

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Wired magazine (May) carries this bit of advice from attorney David Brown, author of Beat Your Ticket:

3. Stall. Two weeks before your trial, request a continuance from the court clerk. The longer you delay, the more likely the officer won’t be able to attend, which should result in a dismissal if you ask for one.

Question: is it ethical to advise clients to ask for continuances with the purely tactical aim of increasing the burden on an opponent, as opposed to the more aboveboard reasons one might have for such a request?

• Sure enough, former Milberg lawyers sue the convicted ex-Milberg lawyers for breach of fiduciary duty. I was wondering when that was going to happen. [WSJ Law Blog; NYLJ/law.com; earlier]
• “Schneider said others in the legal community initially had a hard time understanding why he had filed a grievance against a fellow attorney.” After all, she had only stolen $200,000 from clients. [Las Vegas Review-Journal via ABA]
• Judge: No evidence of wrongdoing by Kenneth Pasternak. Too bad he can’t get his three years back. Meanwhile SEC keeps bringing enforcement cases on same repeatedly rejected theory of liability. [WSJ; Law Blog]
  
• “What the AP and The New York Times’ Hansell don’t seem to realize is how hostile an act it is to send lawyer letters to individuals.” [Jarvis via Patterico]
• “When judges act like politicians, the judicial selection process – elected or appointed – becomes increasingly political. Action and reaction. The politicization of the court led to the politicization of the elections for justices. … When justices arrogate political policymaking to themselves, they should not be surprised when they are held to the same standards as politicians.” [Wisconsin Policy Research Institute via American Courthouse; I said that, too]
• Even Susan Estrich finds the Alex Kozinski web site mini-to-do as evidence of media bias. [Estrich; Patterico link roundup]
• Senator McCaskill shows her ignorance on the Anheuser-Busch merger and corporate officer duties. [Hodak]
• A clever attorney will already have a fill-in-the-blanks product liability complaint drafted against Lego. [Childs]
• Hugo Chavez expropriates wealth to consolidate dictatorship. American lawyer helps. Somehow I don’t think we’ll see an Alien Tort Claims Act suit against his law firm. [AmLaw Daily]

The editors at Conde Nast Portfolio were kind enough to invite me to contribute a rebuttal, which is now online, to William Lerach’s egregious apologia pro crookery sua. The allotted space permits me to address briefly only a couple of Lerach’s worst howlers, in particular his bald assertions that his concealed kickbacks did no harm to class members or to competing lawyers. (It’s true that named class representatives do a very poor job at their intended mission of standing in for other class members’ interests, but secretly aligning their incentives with the size of fee awards, rather than the value of the settlement to the class, is a corruption meant to keep them from ever living up to their theoretical watchdog role.)

For a more extended look at what’s wrong with Lerach’s article, let me recommend Joseph Nocera’s excellent column a week ago in the Times:

In the article, Mr. Lerach expresses zero remorse, positions his crimes as having hurt no one while serving a greater good and makes the absurd claim that he was railroaded by his political opponents.

It is a brazen, shameful piece of work — and it must infuriate the prosecutors who made the plea agreement with him, and the judge who accepted it, especially since Mr. Lerach wrote his own remorseful letter to the judge ahead of his sentencing. It also ought to infuriate anyone who cares about the law. Plenty of criminals head to prison still believing they’re above the law, but Mr. Lerach takes the cake.

Ted Frank has some further thoughts on that point. And note (from Nocera) that Lerach’s “everyone did it” swipes at his colleagues — which many, including we, have read as grounds for an investigation — are by no means passing without contradiction from colleagues:

Mr. Lerach’s statement has infuriated other plaintiffs’ lawyers. “It would just be unthinkable” to give kickbacks to lead plaintiffs, said Max Berger, of the firm Bernstein, Litowitz, Berger & Grossman. Added Sean Coffey, another Bernstein, Litowitz partner: “It is bad enough that this confessed criminal cheated for years to get an unfair advantage over his rival firms. But for this guy, on his way to prison, to say that everyone does it is just beyond the pale.”

(cross-posted from Point of Law; & welcome San Diego Union-Tribune blog readers).

P.S.: For another example of just how slippery Lerach’s careful phrasings can be, check this Roger Parloff post from an earlier point in the scandal. And Stephanie Mencimer, whose writings are nearly always criticized in this space, deserves due credit for seeing through Lerach’s “liberal folk-hero status” to the “pretty sleazy” realities beneath in this February article.

William Gallion takes the stand in the Kentucky fen-phen settlement criminal trial:

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• “I believe it’s frivolous; I believe it’s ridiculous, and I believe it’s asinine”: Little Rock police union votes lopsidedly not to join federal “don/doff” wage-hour lawsuit asking pay for time spent on uniform changes [Arkansas Democrat Gazette courtesy U.S. Chamber]
• Must-read Roger Parloff piece on furor over law professors’ selling of ethics opinions [Fortune; background links @ PoL]
• Too rough on judge-bribing Mississippi lawyers? Like Rep. Conyers at House Judiciary, but maybe not for same reasons, we welcome renewed attention to Paul Minor case [Clarion-Ledger]
• American Airlines backs off its plan to put Logan skycaps on salary-only following loss in tip litigation [Boston Globe; earlier]
• U.K.: Infamous Yorkshire Ripper makes legal bid for freedom, civil liberties lawyer says his human rights have been breached [Independent]
• In long-running campaign to overturn Feres immunity for Army docs, latest claim is that military knowingly withholds needed therapy so as to return soldiers to front faster [New York Rep. Maurice Hinchey on CBS; a different view from Happy Hospitalist via KevinMD]
• Profs. Alan Dershowitz and Robert Blakey hired to back claim that Russian government can invoke U.S. RICO law in its own courts to sue Bank of New York for $22 billion [WSJ law blog, earlier @ PoL]
• Minnesota Supreme Court declines to ban spanking by parents [Star-Tribune, Pioneer Press]
• Following that very odd $112 million award (knocked down from $1 billion) to Louisiana family in Exxon v. Grefer, it’s the oil firm’s turn to offer payouts to local neighbors suffering common ailments [Times-Picayune, UPI]
• AG Jerry Brown “has been suing, or threatening to sue, just about anyone who doesn’t immediately adhere” to his vision of building California cities up rather than out [Dan Walters/syndicated]
• Virginia high school principal ruled entitled to disability for his compulsion to sexually harass women [eight years ago on Overlawyered]

Mark Lanier and other plaintiffs lawyers are giving a series of interviews where they complain that the Ernst v. Merck decision (discussed yesterday) is “judicial activism that reinterprets the evidence.” (E.g., in Texas Lawyer.) This is nonsense. Ernst follows well-stated precedent. Indeed, I predicted precisely this result and precisely the case the appellate court would use to strike down the decision the week of the jury’s verdict.

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Here’s your $3 million bonus, young man, and whatever you do, don’t tell the clients how much the case settled for (Jim Hannah, “Fen-phen lawyer details bonus”, Cincinnati Enquirer, May 15; earlier)(via Slater, WSJ law blog).

We’ve had a lot of Montgomery Blair Sibley coverage over the years:

• His meritless suit against the DC Circuit (followed by a self-defeating appeal to the Supreme Court, where there was no quorum because he had sued seven of the justices)
• his follies in the Palfrey case and in an earlier 2006 Florida prostitution case; and
• his vexatious pro se work in family court.

And we didn’t even mention his work representing Larry Sinclair (the fellow who unsuccessfully sued Barack Obama for denying Sinclair’s implausible claim that he had engaged in a homosexual tryst with him) in a lawsuit against three anonymous bloggers. (DBKP blog, Mar. 14.)

After years of over-the-top abusive litigation, the state bar finally took action, and he has been suspended by the Florida bar for three years. No doubt, this will result in a new round of frivolous pro se collateral litigation. It took a contempt-of-court citation for failure to pay child support before the Florida bar took action, so this can hardly be considered a rousing success of the bar in policing its own, even for someone as over-the-top as Sibley. (Florida Bar v. Sibley; ABA Journal, Apr. 25; MPGS blog, May 14; h/t S.G.).

Update: Two commenters (who never appeared on Overlawyered before) implausibly defend Sibley, both posting from BellSouth accounts in Atlanta, GA. Nothing about a divorce requires one to sue seven Supreme Court justices for “judicial treason” for denying a (frivolous) certiorari petition from a frivolous lawsuit. He should have been disbarred a long time ago; that he is only being suspended, and then only because of failure to obey court orders, is appalling. He’s been a hazard to his clients and to taxpayers; so, no, I don’t think he’s a “damn good lawyer.”

Update, May 16, 2:45 AM: We originally repeated a second-hand report sent to us that Sibley had also been suspended in DC as part of reciprocal discipline. It is possible that our correspondent confused a Rule 8.1 report, made by the DC Bar counsel recommending reciprocal suspension, with an actual suspension. If a Rule 8.1 report was filed, Sibley is entitled to file a response; no oral argument is scheduled at this time (though none is required to be scheduled) and no DC Board on Professional Responsibility report is listed as having issued with respect to Sibley. Rule 8.4 of the DC Board on Professional Responsibility Rules of Procedure is titled “Conclusive Effect of Adjudication in Other Jurisdiction,” which would appear to give Sibley nothing to argue in DC, and would likely make discipline inevitable, but the District of Columbia, in its typical competence, has posted the wrong text for 8.4 on its website, so I cannot say that for certain. Montgomery Sibley is, as of May 16, still listed on the DC Bar’s website as a member in good standing. If the error is ours, rather than that of the DC Bar website, we regret the error. Without written confirmation of the suspension, we retract the original statement that the DC Bar has suspended Sibley in response to the Florida bar’s three-year suspension of Sibley.

Update, May 20: We were right the first time.

Asbestos litigation has been around a long time. Early on, nothing like modern product liability law existed (see Richard Epstein’s discussion here); lawsuits resided in workplace injury law when filed in the 1920s and 30s, and were soon subsumed in workers compensation reforms.

Modern asbestos litigation began after the Selikoff study was published in 1964. In December 1965, Texas attorney Ward Stephenson filed a case on behalf of Claude Tomplait, who had worked as an asbestos insulator. Four years later, Stephenson extracted a settlement for $75,000 from seven defendants.

Notwithstanding this meager beginning, Stephenson persisted in asbestos litigation and won a major victory in Borel v. Fibreboard Paper Products Corp., 493 F.2d 1076 (1973), in which the Fifth Circuit Court of Appeals found asbestos manufacturers strictly liable for their workers’ injuries. The Borel court rejected statute of limitations, contributory negligence, and assumption of risk defenses; and modern asbestos product liability litigation was born.

The litigation got another shot in the arm when New Jersey attorney Karl Asch uncovered the “Sumner-Simpson papers,” which “described in great detail the efforts of Raybestos, Johns-Manville, and other manufacturers to find out about the hazards of asbestos, develop strategies to deal with them, and–most important–to keep that knowledge from the public and workers.” These documents were put to great effect by South Carolina lawyer Ron Motley, who actually used the papers to convince a South Carolina circuit judge to grant a new trial after a jury had ruled in favor of asbestos defendants. Motley of course went on to become an asbestos super-lawyer and an architect of the multibillion-dollar multistate tobacco settlement; his antics are well-known to long-time readers of this site.

Two more foundational cases are worthy of mention. In 1981, the D.C. Circuit ruled that insurers who had written asbestos policies were liable for the maximum insured between exposure and diagnosis, rather than only in the year of diagnosis. See Keene Corp. v Insurance Co. of North America, 667 F.2d 1034 (D.C. Cir. 1981). Given the long latency between asbestos exposure and ultimate illness, the level of insurance exposure was suddenly massive. Circuit Judge Patricia Wald warned that the court’s decision “requires a leap of logic from existing precedent, for it concerns diseases about which there is no medical certainty as to precisely how or when they occur.”

In 1982, the New Jersey Supreme Court threw out the “state of the art” defense for asbestos manufacturers, in essence holding that it mattered not whether business practice was the best available to the industry at the time the injury occurred. See Beshada v. Johns-Manville Products Corp., 442 A.2d 539 (N.J. 1982). The court opined, “The burden of illness from dangerous products such as asbestos should be placed upon those who profit from its production and, more generally, upon society at large which reaps the benefits of the various products our economy manufactures. ”

Thus, in less than a decade, the law was radically shifted, and asbestos litigation was born: “The decade after Borel saw 25,000 asbestos cases filed. By 1981, more than 200 companies and insurers had been sued; by 1982, defendants’ costs had topped $1 billion.” But these early years were just the beginning…

Yesterday, I had the privilege to do a brief interview with Lester Brickman, a professor of law at Cardozo School of Law in New York. Professor Brickman is one of the nation’s leading legal ethicists and the national adacemic expert on asbestos litigation. The discussion is available as a podcast, downloadable here.

I’m happy to see that my initial post — which doesn’t really include any details of yet — has already begun to spark debate in the comments. I have thoughts on the views expressed, but I’ll begin with some background. This information might be old hat to those familiar with the asbestos mess, but it’s essential for those with little knowledge. This summary largely follows the account from the introduction to our Trial Lawyers, Inc.: Asbestos report.

Asbestos manufacturing in the United States was ubiquitous. At one point, asbestos-related industries employed as many as 2.5 million Americans. Asbestos commercial mining began in the U.S. in 1874, and after the Johns-Manville corporation was founded in 1890 with a patent for a process that blended short asbestos fibers with magnesia, asbestos manufacturing exploded: “asbestos consumption went from only 956 metric tons in 1890 to a peak of 803,000 tons in 1973.”

While asbestos ultimately proved deadly, it was originally thought to be a “magic mineral,” as it was dubbed at the 1939 World’s Fair. The word asbestos itself is derived from the Greek for “indestructible,” and the product is an incomparable flame retardant: it insulated generations of schoolchildren from fire and indeed fireproofed our World War II Pacific fleet.

But asbestos has also long been known to be dangerous when inhaled–as far back, perhaps, as the days of Pliny the Elder. In the early 20th century, asbestos was deemed as dangerous as lead and mercury (two products that have themselves spawned much litigation). In 1918, the U.S. Department of Labor declared that there was an “urgent need for more qualified extensive investigation” into the harms of asbestos, and in 1938, the U.S. Public Health Service issued a “good-practice” guideline for Threshold Limit Values of asbestos exposure.

Thus, asbestos was known publicly to be dangerous when virtually everyone suffering from asbestos-related illness was exposed. The extent of the danger, however, was not known definitively until 1964, when a seminal study by Mount Sinai Hospital’s Irving Selikoff established a definitive link between asbestos exposure and lung cancers and asbestosis.

Subsequently, evidence indicated that asbestos manufacturing companies knew more about asbestos’ dangers than they originally let on, and indeed in some cases hid that information from the public. Still, as my colleague Peter Huber pointed out in his review of Paul Brodeur’s Outrageous Misconduct, a much-cited book that harshly criticizes the asbestos industry, the asbestos companies’ early knowledge about asbestosis–asbestos-related lung injury that is rarely fatal, and was generally known–should not be confused with knowledge of the deadly lung cancer mesothelioma, which was exposed by the Selikoff study: “In his account of who knew what when–the core of his cover-up theory–Brodeur systematically obscures the difference between asbestos-related cancer and asbestosis, usually a much less serious disease, and understood and discussed in the Manville boardrooms much earlier.”

In any event, the original asbestos manufacturers like Johns-Manville have long been bankrupt due to litigation exposure. (Johns-Manville, ranked 181 on the Fortune 500 with over $2.2 billion in sales, declared bankrupcty in 1982 due to its looming caseload of 16,500 cases, and projections of up to 200,000 in the future.) The story of how that litigation evolved will be the subject of my next post.

I can’t say how excited I am to be here as a guest at overlawyered — the first legal blog still in existence! I’ll never be the indefatigable blogger that is my colleague Walter, or my friend and fellow legal reformer Ted, but I jumped at the opportunity to come over here to Mr. Olson’s “other” blog (he and Ted are also the mainstays of the Manhattan Institute’s PointofLaw.com, to which I occasionally contribute).

Overlawyered’s long-time readers have doubtless read a lot about asbestos. And we’ve covered asbestos litigation very extensively over at Point of Law. But there’s a lot of new material in the Manhattan Institute’s just-released Trial Lawyers, Inc.: Asbestos, as well as a lot of background for those new to the subject. Over the next week, I’ll be going through both.

I’d urge anyone interested to read the entire report, available here. Those who want a quicker review of some of the newer material should read my column in the Washington Examiner, which ran yesterday. And there’s a good overview of my thoughts in an on-line interview available here.

I’ll be back shortly to begin my walk-through of the report, looking at the underpinnings of the trial lawyers’ big asbestos machine.

Another bunch of things not to do if you’re a member of the legal profession.

• Send insulting letters to opposing counsel. (G.F. Pignato, ordered to write an article about civility.) [Legal Profession Blog via ABA Journal]
• Leave your innocent client in jail by failing to act on new evidence. (William S. Gebbie, surrenders his California license; also accused of stealing client funds.) [ABA Journal]
• Use the NY Yankees trademark without permission in advertising for asbestos clients. [ATL]
• Make “jerk-off” motions in court. (Adam Reposa, Texas, sentenced to ninety days for contempt of court; many in blogosphere are appalled at what they call an overreaction.) [ATL; Simple Justice; Mark Bennett and again; and Patterico notes an interesting coincidence]
• Mock the plaintiffs’ attorney at a jury trial with “Overruled” signs and soccer-style red cards. (Judge James M. Brooks, admonished.) [ATL]
• As a prosecutor, conceal exculpatory evidence. (Former Sonoma County Deputy District Attorney Brooke Halsey Jr., suspended.) [ABA Journal]
• And even if you’re a pro se, don’t send a death threat to opposing counsel by fax. [Milwaukee Journal-Sentinel]

Earlier: Feb. 24.

The law firm of Leeds Morelli & Brown has recently been embroiled in controversy over episodes in which it has settled batches of employment discrimination claims while contemporaneously entering agreements in which the defendants agree to hire it (the Leeds Morelli firm) for substantial sums. Now an African-American woman who was once a vice president at Prudential Insurance and then sued the company for racial bias as a Leeds Morelli client “is asking a federal judge to set aside an arbitration award, alleging her lawyers were given improper financial inducement to keep her claim and hundreds of others out of court. According to Linda Guyden, the company paid $5 million to the law firm representing her and 358 other employees, in return for which Prudential’s total exposure was capped at $10 million and the claims were kept secret just as the company was about to be taken public.” (Mary Pat Gallagher, “Bias Plaintiff Says Lawyer Sell-Out Warrants Vacating of Arbitration”, New Jersey Law Journal, Apr. 8). For a cognate controversy over Leeds Morelli’s settlement of employment claims with Nextel Corp., see Leigh Jones, “Columbia’s Simon Blasts Professors’ Role in Nextel Bias Case”, National Law Journal, Nov. 26; Bluestone, New York Attorney Malpractice Blog, Feb. 12, 2007.

In Sunday’s Times reporter Anthony DePalma takes a much-needed look at attorney Paul Napoli and his Napoli Bern law firm, which is now representing thousands of plaintiffs claiming injury from 9/11 dust inhalation and before that made its name in the fen-phen litigation. Among the controversies that have trailed it to the present day from that affair: charges that it divvied up settlements in a way favorable to its own fee interests, and that it used unreliable “echo mill” expert reports from echocardiologists attesting injury to fen-phen claimants. Prof. Lester Brickman, friend of this site, is quoted extensively. See our extensive earlier coverage at Overlawyered: Dec. 16, 2002, Sept. 21, 2003, etc. (echo mills); Dec. 28, 2001, Feb. 14, 2005, and Mar. 29, 2007 (settlement practices); Feb. 25, 2008 (broad net cast in 9/11 suits)(cross-posted from Point of Law).

Updating our Jan. 6, 2007 post: “The Alabama Supreme Court has ruled that a county judge accused of ethical wrongdoing before he became a judge cannot be disciplined by the state bar until he leaves the bench. A dissenter claimed the majority opinion leads to ‘absurd consequences’ and gives the judge, Stuart DuBose, ‘unwarranted immunity.’” Voters elevated DuBose to a circuit judgeship despite his publicized role “in an estate in which he collected a $1.2 million fee for writing a client’s will without ever meeting the dying man,” to quote our earlier post. (Debra Cassens Weiss, “Facing State Bar Ethics Charges in Alabama? Become a Judge”, Mar. 20).