Posts Tagged ‘bankruptcy’

Asbestos litigation: the Manville Trust

Asbestos litigation continued to grow during the 1980s: by 1992, fully 100,000 claims had been resolved, but another 100,000, yet unresolved, had been filed.

A novel means of processing asbestos claims was initiated in 1988, when the Johns-Manville corporation emerged from bankruptcy and established the Manville Personal Injury Settlement Trust, the first “bankruptcy trust” set up to pay out money to asbestos claimants. Unfortunately, plaintiffs’ attorneys controlled the trust’s claimants committee and set up procedures for the trust that were advantageous to themselves, rather than potential claimants. The trust rules minimized requirements of proof of actual injury or causation (exposure to Johns-Manville products). The trust thus paid out a lot of money quickly to the attorneys, all the while exhausting its funds for potential future claimants.

In just its first nine months of operation, the trust paid out some $500 million to 12,600 claimants — and by the end of 1989, 89,000 more claimants were outstanding. Eventually, the trust had to sharply curtail payments to claimants — to 10 percent in 1995, and 5 percent in 2001. Injured claimants were literally getting a nickel on the dollar. “As of June 30, 2006, the trust had received more than 773,000 claims and paid out about $3.4 billion–just $4,400 per claimant.”

May 12 roundup

  • Canada free speech: Islamic group files complaint against Halifax newspaper over cartoon of burka-wearing terror fan; two more libel suits aimed at online conservative voices; growing furor over complaint against Steyn/Macleans [National Post]
  • More than 5,000 students committed crimes last year in Philadelphia schools, but none were expelled — consent decrees tying system’s hands are one reason [Inquirer]
  • U.K.: Man threatened with legal action for flying pirate flag as part of daughter’s birthday party [Guardian]
  • Bankruptcy judge doesn’t plan to accept at face value Countrywide’s claim that it generated false escrow documents by mistake in foreclosure [WSJ, WSJ law blog]
  • Amid bipartisan calls to step down, Ohio AG Marc Dann [Apr. 19, May 6] hires an opposition researcher [Adler @ Volokh] on top of Washington lobbyist [Legal NewsLine], after being rebuked by judge for political suit [Dispatch]. And where’s that ethics form on the Chesley flight? [Dayton Daily News]
  • Missouri med-mal claims fall sharply after legislated damages curb [Springfield News-Leader]
  • More on Dartmouth prof Priya Venkatesan, the one who wants to sue her students — as suspected, she’s a devotee of deconstructionist Science Studies [Allen/MtC; earlier]
  • Covert plan to sabotage Chinese economy? [Wilson Center event]
  • What, never? Well, hardly ever: Docs continue to assail notion that various complications such as patient delirium, clostridium difficile infection, iatrogenic pneumothorax, etc. — not to mention falls — are “never events” [KevinMD various posts; earlier]
  • Mich. high court agrees anti-gay-marriage amendment bars municipal health benefits for domestic partners, just what key proponents had claimed it wouldn’t do [Rauch @ IGF, Carpenter @ Volokh, earlier]
  • Private service rates the safety of charter air providers — but can it afford the cost of being sued after giving a bad rating? [Three years ago on Overlawyered]

May 6 roundup

  • Raelyn Campbell briefly captured national spotlight (“Today” show, MSNBC) with $54 million suit against Best Buy for losing laptop, but it’s now been dismissed [Shop Floor; earlier]
  • Charmed life of Florida litigators Stanley and Susan Rosenblatt continues as Miami judge awards them $218 million for class action lawsuit they lost [Daily Business Report, Krauss @ PoL; earlier here, here, and here]
  • Lerach said kickbacks were “industry practice” and “everybody was paying plaintiffs”. True? Top House GOPer Boehner wants hearings to find out [NAM “Shop Floor”, WSJ law blog]
  • It’s Dannimal House! An “office rife with booze, profanity, inappropriate sexual activity, misuse of state vehicles and on-the-job threats involving the Mafia” — must be Ohio AG Marc Dann, of NYT “next Eliot Spitzer” fame [AP/NOLA, Adler @ Volokh, Above the Law, Wood @ PoL; earlier]
  • Sorry, Caplin & Drysdale, but you can’t charge full hourly rates for time spent traveling but not working on that asbestos bankruptcy [NLJ] More: Elefant.
  • Fire employee after rudely asking if she’s had a face-lift? Not unless you’ve got $1.7 million to spare [Chicago Tribune]
  • Daniel Schwartz has more analysis of that Stamford, Ct. disabled-firefighter case (May 1); if you want a fire captain to be able to read quickly at emergency scene, better spell that out explicitly in the job description [Ct Emp Law Blog]
  • As expected, star Milberg expert John Torkelsen pleads guilty to perjury arising from lies he told to conceal his contingent compensation arrangements [NLJ; earlier]
  • Case of deconstructionist prof who plans to sue her Dartmouth students makes the WSJ [Joseph Rago, op-ed page, Mindles H. Dreck @ TigerHawk; earlier]
  • How’d I do, mom? No violation of fair trial for judge’s mother to be one of the jurors [ABA Journal]
  • First sell the company’s stock short, then sue it and watch its share price drop. You mean there’s some ethical problem with that? [three years ago on Overlawyered]

Staggered sports schedules: and then came the bill

We’ve reported before (Dec. 24-27, 2001; May 7, 2005; parallel case in New York, Jul. 10, 2004) on the lawsuit charging Michigan high school sports directors with sex discrimination for scheduling girls’ sports in different seasons than boys’. Such cases are subject to “one-way” attorney fee shifting (plaintiffs collect if they win, but need not fear paying if they lose) and the rules for fee calculations are generous. Now the judge has approved a plaintiff’s fee that the athletic directors’ association say threatens to push their group into bankruptcy; opponents say it’s their own fault for resisting so long. Nearly $3 million in fees plus interest are set to go to Kristen Galles, a solo practitioner in Alexandria, Va., whose large number of billed hours at $390/hour may relate to her having worked without a paralegal or secretary. (Julie Mack, “Michigan High School Athletic Association owes $7.4 million in legal fees, interest to lawyers who won case to change the girls sports season”, Kalamazoo Gazette, Apr. 21)(via ABA Journal); “Athletic Group Ordered To Pay $7M”, AP/LexisOne, Apr. 2).

Update: Stephen Yagman draws three-year sentence

The high-profile Los Angeles attorney, who’s made frequent appearances in these pages, is headed to federal prison following his conviction for tax evasion, money laundering and bankruptcy fraud (see Jun. 24). U.S. District Judge Stephen V. Wilson chided Yagman for testimony “so transparently untrue in so many areas.” (Scott Glover, “Attorney Yagman sentenced to 3 years for tax evasion, fraud”, Los Angeles Times, Nov. 28). Best known for his lawsuits against police departments, the much-criticized Yagman has also represented the principals in a famous Americans with Disabilities Act filing mill that launches mass complaints against small businesses and settles them for cash (Mar. 18, 2005; Nov. 4, 2006). According to the L.A. Times account, he “twice was suspended by the state bar for charging clients ‘unconscionable’ fees.” When a retired police sergeant sent him a letter expressing “glee” over his indictment, Yagman promptly sued him (Jan. 5, 2006). Norm Pattis (Nov. 29) reflects: “I wonder whether Yagman became a Leona Helmsley-type figure. The law is for little people, he appears to have thought.”

Vegas columnist, sued for libel, declares bankruptcy

John L. Smith, whom the Las Vegas Review-Journal describes as its most widely read columnist, “has filed for bankruptcy after a two-year legal battle” with casino owner Sheldon Adelson, a subject of Smith’s 2005 book “Sharks in the Desert: The Founding Fathers and Current Kings of Las Vegas.” The newspaper wasn’t sued. Smith concedes the muckraking book contained inaccuracies about Adelson but takes issue with the tycoon’s claim of damages, pointing out that Adelson has mounted from 15th to 6th richest man in the world in the Forbes standings since the book’s publication, “so it’s hard to see how he has been harmed.” Barricade Books, associated with the late Lyle Stuart, also filed recently for bankruptcy. (A.D. Hopkins, “Columnist pursues bankruptcy protection”, Las Vegas Review-Journal, Oct. 12) (via Romenesko).

Update: “SCO Group files for bankruptcy protection”

“Three and a half years after launching a high-profile legal attack on Linux, The SCO Group has filed for Chapter 11 bankruptcy protection. …the company’s legal case was dealt a crushing blow in August, when the federal judge overseeing its case, Dale Kimball, concluded “that Novell is the owner of the Unix and UnixWare copyrights.” Presumably the law firm of Boies, Schiller & Flexner, which was pursuing SCO’s ambitious anti-Linux claims on contingency, has had to scale back its expectations of a payday (Stephen Shankland, CNet, Sept. 14). Earlier: Nov. 6, 2003, Nov. 13, 2004. More: Roger Parloff, Fortune “Legal Pad”.

September 13 roundup

Louisiana fuel-gauge fee carve-up, cont’d

Assisted by Loyola lawprof Dane Ciolino, critics are now before a Fifth Circuit panel trying to uncover the supporting documents that back up the division of fees among lawyers following a fuel-gauge-damage settlement against Shell; the case drew national attention after the lawyers in charge prevailed on a federal judge to conceal the allocation of fees from public scrutiny, including scrutiny by members of the client class as well as dissident lawyers (Apr. 9, Jun. 7).

When Little [fee committee attorney F.A. Little] contended that naming someone other than the committee to evaluate four years of work by lawyers in the case wouldn’t yield the best result, Judge Edith Jones shot back, “Well, at least you get disinterestedness.”

That quality, Jones said she learned from her days as a bankruptcy attorney, is essential to “anyone who is dividing up the debtor’s money.”

In an interview after the hearing, Ciolino said the public needs to know everything that went into deciding attorney fees in the Shell class action. “The public distrusts lawyers, especially in class-action cases, because it looks like it’s all about fees,” he said.

(Susan Finch, “Data used to split fees sought”, New Orleans Times-Picayune, Aug. 10).

August 22 roundup

  • Criminal charges dropped against Oregon 13-year-olds over fanny-swatting in school corridors [, Malkin, and AP; earlier]

  • Elasticity of “medical error” concept: Medicare will stop paying hospitals for treatment of “reasonably preventable” injuries that happen in hospitals, such as patient falls — we all know those are preventable given enough duct tape [NCPA, Right Side of the Rainbow; and before assuming that bed sores invariably result from negligent care, read this](more: Turkewitz)

  • Yale University Press beats back libel suit in California court by Muslim charity over allegations in book scrutinizing terrorist group Hamas [Zincavage]

  • Law firms, including Philadelphia’s senatorially connected Kline & Specter, already advertising for clients following Mattel toy recall [Childs]

  • First class action against RIAA over its scattershot anticopying suit campaign [P2PNet]

  • Four Oklahoma inmates claim copyright to their own names, demand millions from warden for using those names without permission, then things really start getting wild [UK Telegraph and TechDirt via Coleman]

  • UCLA’s Lynn LoPucki, scourge of corporate bankruptcy bar, has another study out documenting soaring fees [WSJ Law Blog]

  • Man who knifed school headmaster to death is expected to win right to remain in Britain on grounds deporting him would violate his human rights [Telegraph]

  • Among targets of zero tolerance bans: jingle of ice cream trucks in NYC, screaming on Sacramento rollercoasters []

  • Does California antidiscrimination law require doctors to provide artificial insemination to lesbian client against religious scruples? [The Recorder]

  • Alabama tobacco farmers got $500,000 from national tobacco settlement, though fewer than 300 acres of tobacco are grown in Alabama [five years ago on Overlawyered]