Archive for January, 2007

The Big Game

Notice how in the last few years all the advertising has started referring to the mysterious “Big Game”? That’s because the NFL has sicced lawyers on marketers who refer to the “Super Bowl” without paying merchandising fees to the NFL, including suing Las Vegas casinos that offered Super Bowl parties or special weekend rates for the Super Bowl or contest promoters that offered Super Bowl tickets. (Eriq Gardner, “Super Bowl, Super Trademarks: Protecting the NFL’s IP”, Hollywood Reporter Esq., Jan. 29 via Lattman).

(Update: Frequent commenter Deoxy points us to this similarly-themed Indianapolis Star story.)

Those new referee uniforms the NFL implemented this year have a similar intellectual property provenance. The NFL apparently was concerned at the spate of advertising that used referees in the generic referee stripes, and decided to create a unique look that it could slap a trademark on and potentially market later.

Enviro suits sap wilderness upkeep budgets

The Boundary Waters Canoe Area Wilderness in Minnesota, described as the nation’s most heavily visited wilderness area, is a part of the Superior National Forest. These days the forest’s managers

face the financial repercussions of legal decisions they say are stripping scarce resources from their wilderness budget, undermining maintenance work, and leaving many wilderness restoration projects on hold….

While many environmentalists fervently believe that such suits help protect the wilderness, Forest Service officials say many of the agency’s legal expenses come straight from the Superior’s wilderness budget— money that would otherwise pay for the kind of on-the-ground maintenance and restoration work that everyone seems to agree is badly needed in the nation’s most heavily-visited wilderness area.

“When you start figuring out what that means in terms of hiring wilderness rangers or buying fire grates or latrines, it has a huge impact,” said Barb Soderberg, public affairs officer for the Superior National Forest. …

The local forest officials receive a modest $1.5 million a year to manage the 1.1 million-acre wilderness area. According to its supervisor, the forest has been in court continuously since 1949. Under the “one-way” fee structure of federal environmental law, the forest like other defendants can be ordered to pay a plaintiff’s full attorneys’ fees even if the plaintiff wins on only some issues in a case, but cannot collect itself even if it manages to prevail on all issues. Last year a court ordered the forest to fork over $90,000 to prevailing environmentalist lawyers from the elite Twin Cities law firm of Faegre & Benson. Not by coincidence, the forest has found itself obliged to slash its budget for temporary wilderness rangers, from $240,000 to $135,000, “in large part due to ongoing litigation costs”.

The environmental representatives contacted for this story all acknowledged they don’t weigh the costs to the Forest Service when deciding whether or not to file suit against an agency decision….Brad Sagen, the new board chairman of Northeastern Minnesotans for Wilderness, said it isn’t his organization’s job to consider costs of lawsuits— indeed, he called the question “absurd.”

In fact, Sagen and another environmentalist expressed surprise that legal expenses and payouts come out of the agency’s operating budget, apparently unaware that such a practice is widespread in government, commonly defended as a variety of accountability that helps give agency officials proper incentives to bring their activities into full compliance with all applicable laws (if that’s possible).

Meanwhile, environmentalists are piling on with more new lawsuits, over a new forest management plan and a snowmobile trail, while continuing to pursue an old one about motor quotas. Much, much more here for those with an interest in this area. (Marshall Helmberger, “Environmental lawsuits sap U.S.F.S. wilderness maintenance budgets”, Ely, Minn. Timberjay, Jan. 26)(profile of author at Minnesota Public Radio).

Milberg Weiss Nortel fee award

Plaintiffs’ attorneys led by Milberg Weiss received only $710/hour for their work transferring $1 billion from current Nortel shareholders to past Nortel shareholders (and, of course, their attorneys) in a securities lawsuit, for a total of $34 million (plus $3.7 million in expenses). They had been seeking nearly three times that amount. While Judge Berman found that the fee request of 5.8 times regular hourly billing rates was excessive, he did not inquire into whether the law firms’ claim of 47,846 hours billed was reasonable. Indicted Milberg Weiss attorney Steven Bershad had been lead counsel until he was voluntarily substituted by another Milberg Weiss attorney shortly after his indictment. (In re: Nortel Networks Corp. Securities Litig., No. 01-cv-1855 (Jan. 29, 2006); David Glovin, Bloomberg, Jan. 29). Update: WSJ Law Blog has the ruling on line.

“100+ All-American Ideas: Stay Out of Court”

Belatedly noted: Reader’s Digest gives us another generous mention (latest in a long series of such) as part of a wider project cataloguing ideas and proposals that could make the country better (Sacha Zimmerman, Reader’s Digest, posted Sept. 14). For another generous mention from the Digest, see Jun. 12, linking to an article by reporter Michael Crowley. And we’ve also been slow to link another good piece from Digest reporter Crowley, on the problems introduced by jury consultants “paid to stack the deck” (Michael Crowley, “Jury Riggers”, Apr. 2006). Sample:

A recent guide published by the Association of Trial Lawyers of America warned lawyers about jurors who may show “personal responsibility bias.” These jurors, the guide said, feel that “people must be accountable for their conduct.” Now there’s a chilling outlook! The guide advises: “The only solution is to exclude them from the jury.” That is, get rid of anyone who might actually care about seeing justice done.

Short ’em, then sue ’em II

According to a WSJ news report, Greenlight Capital, a $4 billion New York hedge fund, has filed a federal False Claims Act lawsuit against Allied Capital Corp., alleging that a subsidiary of Allied known as Business Loan Express LLC, or BLX, “submitted fraudulent loan documents to the Small Business Administration, bilking the U.S. of millions of dollars. Greenlight and James Brickman, an individual working with the fund to bring the suit, are entitled to 25% to 30% of the proceeds if their complaint results in an award.” Aside from the novelty of a hedge fund’s getting into qui tam litigation (perhaps no real surprise, given the proven money-making scope afforded by that bounty-hunter’s statute) the even more noteworthy twist is that Greenlight has also taken a short position in Allied’s stock, so that it will profit if the stock falls independently of whether the litigation results in a successful recovery. (Carol S. Remond, “Greenlight Heads to a Courtroom”, Wall Street Journal, Jan. 29)(sub-only).

We’ve reported at some length previously (here and at Point of Law) about the evidence that plaintiffs and their lawyers sometimes short target companies’ stocks before filing lawsuits, and about the fairly grave implications of that both as a matter of legal/litigation ethics and for the “market integrity” rationale of securities regulation. See, for example, May 5, 2005 and Sept. 14, 2006, as well as (relatedly) Nov. 14, 2006, and at Point of Law, Feb. 6 and Mar. 3, 2006, and this Featured Discussion.

January 29 roundup

  • Update to Maine Board of Tourism intimidate-a-blogger-by-litigation lawsuit: case dismissed, government official fired. [Maine Web Report; AP/Boston Globe]
  • Senter blocks State Farm Katrina class settlement. [Point of Law; Rossmiller; Woullard v. State Farm]
  • Senator Schumer (D-NY) calls for liability reform to save New York economy; Governor Spitzer shows up at press conference. [Point of Law]
  • Canadian $10M settlement for Syrian torture: that’s what we get for trusting Syria. [Frum]
  • Remember that case in Snohomish where the celebratory cannon blew up at the football game? And the plaintiffs’ lawyer complained that the injured student was getting threatened by the townspeople over his lawsuit? Turns out the student (allegedly) told a youth minister that he deliberately overloaded the cannon for “a bigger bang,” and now is (allegedly) harassing the minister. And the original threats had nothing to do with football spirit. Everett Herald]

  • Regulations drive restaurateurs from New York to friendlier (if armpittier) climes. [New York via Taylor]
  • Suit: suicide fault of auto dealership sponsoring “Hands on a Hardbody” contest. [AP/ Austin American-Statesman]
  • Nanny statism meets failure to contemplate ex ante vs. ex post thinking in UK: new Manchester police policy is to refuse to chase helmetless bicycle thieves. [Telegraph (h/t F.R.)](earlier)

  • Private eyes and lawyers among the transactions costs of rent regulation in New York. [NYT]
  • The war on science doesn’t just come from the right. [Adler @ Volokh; Sandefur @ Positive Liberty]

  • Mrs. Alito is very cool [WaPo via Bashman]