Overlawyered: Chronicling The High Cost Of Our Legal System

Archive for June, 2004

Jackpot in San Diego

Drivers of the Ford Explorer have a lower fatality rate than drivers of other vehicles — and a lower fatality rate from rollovers than drivers of other SUVs. The NHTSA found that there was nothing wrong with the Explorer’s design after a spate of well-publicized accidents resulted in an investigation. Nevertheless, plaintiffs persist in filing lawsuits accusing the Explorer of being unreasonably dangerous. And one can see why: Ford has successfully defended the vehicle in at least ten consecutive jury cases, but on Wednesday a San Diego jury rewarded the latest roll of the dice with a $122.6 million verdict for a paraplegic plaintiff, Benetta Buell-Wilson. Ms. Buell-Wilson was driving at a high speed on Interstate 8, when the RV in front of her lost a large piece of metal; she lost control of the SUV when she swerved, and the vehicle went off the highway and flipped 4 times before landing on the roof. The jury returns today to deliberate the question of punitive damages. (Ray Huard, “$123 million awarded in SUV rollover”, San Diego Union-Tribune, Jun. 3; Myron Levin, “Jury Orders Ford to Pay $122.6 Million”, LA Times, Jun. 3) (via Bashman). “This was an extremely severe crash, and any SUV would have reacted in the same way under similar circumstances,” Ford spokeswoman Kathleen Vokes said. “Our concern goes out to Ms. Buell-Wilson and her family, but this tragic accident was caused by a combination of high speed and a large metal obstruction in the road.” (“Verdict ends Ford streak”, Detroit News, Jun. 3). Ford says it will appeal; the jury awarded four times more than what plaintiffs asked for.

Update: Jury awards $246 million in punitive damages. Ford protests that it wasn’t allowed to introduce evidence to the jury comparing the safety record of the Explorer to other SUVs. (Reuters, Jun. 3; Myron Levin, “Jury Adds Punitive Award in Ford Case”, LA Times, Jun. 4).

Update: Judge reduces damages to $150 million; Ford has appealed. (Michelle Morgante, AP, Aug. 19; Nora Lockwood Tooher, “Explorer Rollover Yields $368.6 Million Verdict”, Lawyers Weekly USA, Dec. 30).

As with all my posts, I speak for myself and not my firm or any of my firm’s clients (which include Ford).

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Autopsy finds mouse died of skull fracture

…undercutting plausibility of claim that it got into the soup by mistake. The “incident caused Cracker Barrel to stop serving vegetable soup at all of its 497 stores nationwide. … [A spokeswoman for the company] said the Pattersons had demanded $500,000 from the company” but now they’ve been arrested instead. (Peter Dujardin, “Tests reveal mouse-in-soup hoax; pair charged”, Newport News (Va.) Daily Press, Jun. 2)(via Legal Reader). See also Jan. 25-27, 2002.

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Asbestos bankruptcy shenanigans

In 1994 “Congress fiddled with the bankruptcy code in a way that allowed trial lawyers to exploit asbestos bankruptcies. It works like this: In a normal bankruptcy, a creditor’s voting weight is mainly determined by how much he’s owed. But thanks to the 1994 change, all asbestos ‘creditors’ (claimants) are treated equally.” A dying cancer patient gets the same vote as someone with no detectible health impairment at all. “It didn’t take long for tort lawyers to figure out how to game this system. The leading asbestos law firms team up and pool their unimpaired plaintiffs (who each get a vote), draw up a plan that gives the bulk of the money to their clients, and then outvote the other creditors.” Once in control, the lawyers can begin in effect running the affairs of the company in ways that provide them with further benefits, including cutting themselves large fees for their administrative and dealmaking services. (“The latest asbestos scam” (editorial), WSJ, Jun. 1)($$) See also Mar. 15-16, 2003.

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4,000 federal crimes

A new study for the Federalist Society finds that the U.S. Code now defines well over 4,000 crimes, and that the count has risen by more than a third since the early 1980s. A substantial share of the newer offenses, around a third, are environmental in nature, and the rate of enactment of federal criminal statutes spikes in election years, finds the author, Prof. John S. Baker, Jr. of Louisiana State University Law Center. Moreover, the trend is toward a chipping away of the traditional requirement for a mens rea — that is, a guilty or otherwise knowing state of mind — in favor of the criminalization of what may be inadvertent regulatory infractions. (“Measuring the Explosive Growth of Federal Crime Legislation”, study in PDF format/supplementary reading). More: William L. Anderson and Candice E. Jackson, “Washington’s Biggest Crime Problem”, Reason, Apr.

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Schwarzenegger punitive damage plan

My op-ed on the subject appears in today’s Wall Street Journal. (Walter Olson, “More Punitives to the People!”, Jun. 2)($$). The California governor’s proposal to have the state take 75 percent of punitive awards has gotten a more favorable reception from the left/liberal side of the blogosphere than some might have expected; see Nathan Newman (calling it “the right idea”)(May 17), Atrios (“not a bad idea”) May 17, plaintiff’s attorney Dwight Meredith (more)(“I have no major objection to having a portion of punitive damages go to the state.”)(May 26)(and see Jun. 1 on the governor’s fanciful revenue scoring), and Kevin Drum (“probably a good idea”) May 29.

See also Adam Liptak, “Schwarzenegger Sees Money for State in Punitive Damages”, New York Times, May 30. More editorial and commentary links: Dan Walters, “Arnold enters battle over tort reform”, Sacramento Bee/Alameda Times-Star, May 29; “Sensible concept, suspicious numbers” (editorial), San Jose Mercury News, May 25 (reg); Phil Yost, “Governor’s budget counts on windfall that won’t arrive”, San Jose Mercury News, May 30 (reg); “A lawyer joke” (editorial), San Francisco Chronicle, May 27; George Skelton, “Proposal to Tap Punitive Damage Awards Has Many Agendas”, Los Angeles Times, May 24; “State profit in punishment” (editorial), Los Angeles Times, May 24. Further: Martin Grace has some more information about collections under the Georgia “split-award” statute (Jun. 2), and Paul Caron at TaxProfBlog discussed the proposal May 20.

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Fingerprint evidence

Not quite the infallible science it seemed, as many were beginning to grasp even before the fiasco of the Brandon Mayfield case. (Jennifer L. Mnookin (University of Virginia Law School), “The Achilles’ Heel of Fingerprints”, Washington Post, May 29). More: David Feige, “Printing problems”, Slate, May 27.

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NYC lead-paint law begins wreaking havoc

Exactly as predicted (see Dec. 15, Feb. 13): “Two months before it goes into effect on Aug. 2, the city’s new lead-paint legislation has caused nonprofit groups and private developers to shelve plans to redevelop buildings for low- and moderate-income tenants. … Frank Anelante, president of Lemle & Wolf, a developer and manager of lower-income apartments, primarily in the Bronx, said he had halted the rehabilitation of two five-story walk-ups in upper Manhattan because the procedures required by the law made apartment reconstruction impractical.” According to John M. McCarthy, executive vice president of the Community Preservation Corporation, the largest provider of mortgages for the city’s older midsize apartment buildings, the new law “leaves owners extremely vulnerable to damages in a lawsuit. We can’t provide mortgages under those circumstances unless the owner is able to get insurance at a reasonable cost.” (Alan S. Oser, “Lead-Paint Law Frustrates Plans for Low-Income Housing”, New York Times, May 28).

Papa John’s Suit

Michael Harris, a 19-year-old delivering pizzas for Papa John’s, gossiped with a manager that his supervisor, Robert Shields, was sleeping with an employee. Shields found out, and he and Harris decided to resolve their differences by agreeing that Shields would punch Harris in the chest. Unfortunately, the punch caused cardiac arrhythmia and killed Harris. Harris’s family sued Papa John’s, and the Iowa Supreme Court ruled May 12 that a jury would need to decide if the punch was an “adverse employment action” entitling the family to damages from the employer, or a private matter.

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