Chronicling the high cost of our legal system

Overlawyered

July 25th, 2008 at 12:19 am

July 25 roundup


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July 25th, 2008 at 12:01 am

Prosecutors Gone Wild

» by Ted Frank

[A] large deal of the gleeful Spitzerfreude on Wall Street arose from of the poetic justice of Spitzer’s undoing at the hands of the same extra-judicial tactics he regularly used against Wall Street firms and corporate executives when he was attorney general of New York. The real scandal of Spitzer’s career was not so much the former Girls Gone Wild model as the prosecutors gone wild.

My retrospective of Eliot Spitzer as both archetype and victim of overaggressive prosecutors in the July/August American Spectator is now on line at the AEI website.


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July 24th, 2008 at 5:36 pm

LA Weekly: The Mold Rush and the case of Sharon Kramer and Bruce Kelman

» by Ted Frank

Welcome LA Weekly readers; this website is mentioned and I am quoted in a less-than-entirely-coherent story about mold litigation in this week’s LA Weekly. The story focuses on Sharon Kramer, who has given up a full-time career to pound the drums over her fight with her insurer alleging mold harms after a remediation; and an unfortunate lawsuit brought by scientist Bruce Kelman against Kramer. Kelman only wants an apology from Kramer for her issuing a press release that falsely claimed he lied under oath; Kramer has refused, and Kelman is still stuck in litigation where he will likely come up with a Pyrrhic victory. (Kelman’s work writing a layperson’s guide to the science of mold for the Manhattan Institute is central to the libel allegations.) Kramer, meanwhile, blames her aging on exposure to mold, rather than, say, turning 56. The story suffers for treating Erin Brockovich as the archetype of a justified plaintiff; Overlawyered readers know better.

The story is worthwhile for one new tidbit of information, the poetic justice facing Ed McMahon for his bogus mold lawsuit:

In 2003, another raft of huge mold news stories broke nationwide, and Kramer paid close attention. The most famous, and strangest, was that of Johnny Carson’s sidekick Ed McMahon, who took a $7.2 million settlement after suing for $20 million in his claim that mold made him and his wife sick — and killed his sheepdog, Muffin. …

In the McMahon case, some see the tragic unraveling of a popular public figure egged on by an attorney, Allan Browne. No hard, scientific evidence was ever made public proving that McMahon or his dog suffered the specific mold allergies and immune-system problems that, in rare cases, can be set off by household mold.

Since then, McMahon has become a sad figure, with a series of new troubles, including his default this year on his palatial 7,000-square-foot home on Mulholland Drive, involving a $4.8 million loan from the infamous lender Countrywide. And he just sued again, bizarrely accusing investment tycoon Robert Day of having in his mansion a poorly lit staircase on which McMahon says he fell during a party last year. McMahon is belatedly alleging he broke his neck but that doctors missed it.

The longtime TV pitchman spent years convincing the courts and the general public that his home contained rampant, poisonous, deadly mold strong enough to fell a large dog. McMahon talked it up for so long that he now faces the daunting task of selling a home he can no longer afford, that people believe is riddled with toxins.

Also interesting to me is the story’s quote of me. I gave an e-mail interview to the author, Daniel Heimpel in February. It’s interesting what gets used and what doesn’t get used, so I am going to attach the entire interview.

Here’s the full February 28 interview:

Continue Reading »


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July 24th, 2008 at 3:22 pm

Breaking: Tennessee Supreme Court reinstates punitive damages in Flax v. DaimlerChrysler

» by Ted Frank

Perhaps we spoke too soon when we commended the Tennessee appellate court for getting it partially right. As we stated in November 2004:

In 2001, Louis Stockell, driving his pickup at 70 mph, twice the speed limit, rear-ended a Chrysler minivan. Physics being what they are, the front passenger seat in the van collapsed backwards and the passenger’s head struck and fatally injured 8-month old Joshua Flax. The rest of the family walked away from the horrific accident. Plaintiffs’ attorney Jim Butler argued that Chrysler, which already designed its seats above federal standards, should be punished for not making the seats stronger — never mind that a stronger and stiffer seat would result in more injuries from other kinds of crashes because it wouldn’t absorb any energy from the crash. (Rear-end collisions are responsible for only 3% of auto fatalities.) Apparently car companies are expected to anticipate which type of crash a particular vehicle will encounter, and design accordingly. The $105M verdict includes $98M in punitives.

We had more details of trial shenanigans in December 2004 and noted the reduction of the punitives by the trial court to a still unreasonable $20 million in June 2005. In December 2006, the intermediate appellate court threw out the punitive damages and the negligent infliction of emotional distress claim, leaving a $5 million compensatory damages verdict to be split between Chrysler and the driver responsible for the accident. An injustice, but at least a smaller injustice.

However, today, a 3-2 vote of the Tennessee Supreme Court made it a larger injustice again, reinstating $13,367,345 of punitive damages over a good-faith dispute over appropriate seatback design, giving no credit to evidence that the design in the Caravan was safer than the plaintiffs’ proposed design, and effectively disregarding Tennessee statutory law that compliance with federal standards creates a presumption against punitive damages. The Court did not mention Exxon Shipping’s suggestion that punitive damages greater than a 1:1 ratio were possibly constitutionally inappropriate where compensatory damages were substantial and the defendant’s actions were not intentional or done for profit. The Court unanimously affirmed the elimination of the NIED claim; one justice would have thrown out the compensatory damages, as well, because of the volume of inadmissible and improperly prejudicial evidence admitted. (Flax v. Daimler Chrysler (Tenn. Jul. 24, 2008); id. (Wade, J., concurring); id. (Clark, J., partially dissenting); id. (Koch, J., partially dissenting); E. Thomas Wood, “High court upholds $18.4M damage award in DaimlerChrysler case”, Nashville Post, Jul. 24; Kristin M. Hall, AP/Chicago Tribune, Jul. 24). The majority decision relied heavily on the expert testimony of Paul Sheridan, an MBA non-engineer and professional anti-Chrysler witness whom a federal court called “wholly unqualified” to testify on seat back design.


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July 24th, 2008 at 3:19 pm

Yet more Edwards campaign-cash laundering

Big-league Arkansas trial lawyer Tab Turner did it, and was fined $9,500. Big-league Michigan trial lawyer Geoffrey Fieger did it, and managed to beat the rap at his recent trial. And now we learn that big-league California trial lawyer Pierce O’Donnell did it too: evaded limits on campaign contributions to John Edwards by reimbursing underlings to enable them to contribute. Would it be simpler to compile a list of the big Edwards backers who did obey the law? (WSJ law blog, Jul. 24). More on Edwards campaign finance shenanigans here.


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July 24th, 2008 at 1:58 pm

Service animals, cont’d: “Ferret barred from Ottawa buses”

Continuing our theme, Frances Woodard has now lodged a complaint against the public transit authority in Canada’s capital city for barring the diminutive, weasel-like predator whose companionship, according to her psychiatrist, helps her stave off panic attacks. “A letter from OC Transpo customer relations sent in May said the decision was a result of fears about allergic reactions and phobias from other passengers and reactions from other animals, such as guide dogs.” (CBC News, Jul. 23). Monday’s post on the “service monkey” lawsuit from Springfield, Mo. is here.


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July 24th, 2008 at 1:42 pm

Update: Willie Gary case against Motorola

Per AmLaw Daily, his trade secrets case against Motorola, on behalf of a now-defunct client named SPS Technologies, has settled for a sum far short of the $10 billion he sought. The case made headlines when a judge granted the Florida-based plaintiff’s potentate $23 million in sanctions against his opposite number, the law firm of Shook, Hardy & Bacon, though Gary had asked for $200 million in all. Reports AmLaw Daily:

The rising cost of fuel also has forced Gary to lease out his private jet — an aircraft appropriately named the “Wings of Justice II,” which includes an 18-karat gold sink and $1.2 million sound system — for $150,000 a month.

In late July, Gary told Scripps Treasure Coast Newspapers that fuel for the 32-passenger Boeing 737 costs $250,000 a month. A routine roundtrip flight to a city like Atlanta can run $35,000.


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July 24th, 2008 at 12:22 am

Cops: lawyer funneled brothel profits through good-government fund

Really, we couldn’t make it up: after raiding the Hot Lap Dance Club on W. 38th St. in Manhattan as a front for prostitution, police arrested lawyer Louis Posner and 22 others as part of the enterprise, which allegedly skimmed earnings from girls who entertained customers in private rooms for fees as high as $5,000. “Posner, once known as the king of nuisance lawsuits, brought a landmark $16 million suit against his then-4-year-old son’s nursery school in 1992 for letting the child run out of his classroom.” (New York Daily News first, second, third, fourth story). Posner, who more recently has concentrated on such areas of practice as taxes, trusts and estates, is reviled by several sources in the New York Daily News’s coverage for hitting on the girls himself, to their frequent disgust. Incomparable detail: cops claim Posner funneled the brothel profits through a political activist group called Voter March, which he set up after the disputed Bush-Gore election in 2000. (ABA Journal, New York Times). Fair labor practices angle: “The pair [of interviewed dancers] estimated that 120 women worked there. Some were Americans who operated as independent contractors and paid $80 a night in ‘house fees;’ others were Russians who worked to pay off debts to their handlers.” And we can’t leave this out: “The club last made news in March when it was sued by a securities trader who claimed he was seriously injured when a lap-dancing stripper swiveled and slammed him in the face with her shoe.” More: Above the Law, New York Observer.


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July 23rd, 2008 at 10:06 pm

Sacha Baron Cohen lawyer script

The “Borat” star, per AFP, “has sold Fox film studios a comedy, ‘Accidentes,’ about an ambulance-chaser-turned-hero, which he will produce and possibly star in, Variety magazine said Tuesday. The film is about a personal injury lawyer who becomes a hero among Los Angeles Hispanics for successfully defending a worker against a wealthy employer, but who in the process becomes the enemy of the city’s elite.” And see Defamer Australia with related graphic: “El Mejor Abogado”.


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July 23rd, 2008 at 8:52 pm

Servitude to the state

Whatever this group “Service Nation” is all about, it sure isn’t liberty. Jim Lindgren has their number (Volokh Conspiracy, several recent posts; Coyote; Althouse).

But see: the organization now denies (Somin @ Volokh) that its agenda includes mandatory national service, despite the goal recently listed on its website (now removed) of “Launch[ing] a debate about why and how America should become a nation of universal national service by 2020.”


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July 23rd, 2008 at 6:24 pm

WLF on Rhode Island lead paint verdict

» by Ted Frank

Attorneys Thomas R. Bender, Richard O. Faulk, and John S. Gray analyze the Rhode Island Supreme Court ruling in the lead paint case, detailing the history of the case and note the implications for other public-nuisance suits in the global warming and mortgage foreclosure fields.


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July 23rd, 2008 at 12:41 pm

School scenarios, 1958 vs. 2008

This doesn’t pretend to be anything more than a bit of unattributed circulating email humor, but it still made me laugh:

Scenario: Jack goes quail hunting before school, pulls into school parking lot with shotgun in gun rack.
1958 – Vice Principal comes over, looks at Jack’s shotgun, goes to his car and gets his shotgun to show Jack.
2008 – School goes into lock down, FBI called, Jack hauled off to jail and never sees his truck or gun again. Counselors called in for traumatized students and teachers. …

Full thing at Never Yet Melted.


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July 23rd, 2008 at 11:07 am

Memphis: “Police director sues for names of bloggers critical of MPD”

“Memphis Police Director Larry Godwin and the city of Memphis have filed a lawsuit to learn who operates a blog harshly critical of Godwin and his department.” (Amos Maki, Memphis Commercial Appeal, Jul. 22, via Folo). More: Instapundit.


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July 22nd, 2008 at 11:18 pm

Laura Hess suspended; Hess Kennedy in receivership

» by Ted Frank

Updating our previous story, the South Florida Sun-Sentinel reports that the Florida Bar has taken action against the law firm that may have ripped off millions of dollars from consumers.

State documents filed in Broward County Circuit Court claim that in 2006 and 2007 the law firm run by Laura Hess and an affiliated company managed by Edward Cherry paid $12 million to friends and relatives, and to businesses run by former employees or associates of Hess and Cherry.

In the meantime, the firm did not negotiate with clients’ creditors or review credit records as promised, resulting in some consumers being sued for their debts or having to file bankruptcy, records showed.

Hess Kennedy Chartered LLC and The Consumer Law Center collected “exorbitant” upfront fees, usually up to 15 percent of the client’s unsecured debt, according to the Florida Bar’s Tuesday filing with the Florida Supreme Court.


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July 22nd, 2008 at 7:34 pm

John Edwards, Rielle Hunter, and Elizabeth Edwards

» by Ted Frank

I have no idea if the allegations that former presidential candidate John Edwards has a love-child with Rielle Hunter are true–though his actions seem pretty damning.

But let me be the first to point out that, if the allegations are true, Elizabeth Edwards can take advantage of North Carolina’s unusual tort law to sue Hunter for alienation of affection. When we last looked at the state of affairs in North Carolina in 2006, there were 200 such suits a year, with some verdicts in the six and seven digits. Of course, Mrs. Edwards would need a trial lawyer willing to take on her husband first.

Efforts to abolish the tort in the state have not been successful, though it is worth noting the fact that several dozen states have abolished heartbalm statutes without anyone suggesting that this tort reform is constitutionally problematic.

Update: Edwards persuades me that the story might be true when he gives a lawyerly non-denial denial filled with negative pregnants: “That’s tabloid trash. They’re full of lies. I’m here to talk about helping people.”  Someone needs to ask a more targeted question of a purported candidate for vice president or attorney general.


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July 22nd, 2008 at 5:22 pm

Disbarred lawyer: Amex helped the cops trace me

By reader acclaim, to quote Michael Krauss at PoL: “a disbarred Manhattan lawyer, who has been convicted of statutory rape, has sued the American Express Co. for giving police credit card information that he says led to his capture in Canada, where he had fled to avoid prosecution. 44-year old James Colliton objects that American Express violated its agreement to withhold customer information from third parties. We haven’t seen his contract with Amex, but doubt that it obliges the company to resist requests from law enforcement.” Any readers able to shed light on this question? More: NY Post, NY Daily News.

More: Discussion continues at Scott Greenfield’s.

July 22nd, 2008 at 2:20 pm

“Family wants $1.5M for unauthorized use of their images”

The Humphreys - Bagent - Aguilar family of Charles Town, W.Va. and Fort Wayne, Ind. says professional photographer Sheri Grippo-Titus, who formerly practiced in Charles Town, used at least 74 photos of the family on her web site without obtaining a requisite model release, so they’d appreciate getting a million and a half. Possibly relevant: one member of the family formerly worked for Grippo-Titus but parted on unhappy, still-disputed terms. (Cara Bailey, West Virginia Record, Jul. 18). More on photo permissions here, here, and at other points in our art and artists category.


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July 22nd, 2008 at 12:20 pm

Labaton Sucharow rebuffed again

“For the second time in less than a week, class action law firm Labaton Sucharow has been reprimanded for overreaching in its attempts to lead a major securities fraud action.” Having attained lead counsel status in one class action against American International Group, the firm sought to combine that case with others pending elsewhere that raised quite different claims against the much-sued insurer.

“As is readily apparent here, lead plaintiff’s Motion for Leave to Amend to add unrelated claims is a calculated attempt at judge shopping,” [Southern District of New York federal judge John] Sprizzo wrote. “It seems apparent that lead plaintiff is trying to usurp lead plaintiff status over claims which are properly in front of other judges.”

The decision came just three days after Southern District of New York Judge Jed S. Rakoff admonished Labaton Sucharow attorneys for perhaps not “fulfill[ing] their professional responsibilities” in their proposal of a co-lead plaintiff in In Re Monster Worldwide Securities Litigation, 07 Civ. 2237.

(Mark Fass, “Labaton’s Newest Bid to Lead Major Securities Fraud Action Rejected”, New York Law Journal, Jul. 22).


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