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February 9, 2010
How the Plaintiffs Bar Bought the Senate
Posted by James R. Copland
In today's Wall Street Journal, I have an opinion piece that explains how the plaintiffs' bar is using its campaign-funding largesse to buy political influence:
Since 1990, the sums donated to federal political candidates by lawyers--excluding lobbyists--exceed $1 billion, according to CRP. Lawyers as a group have given more to federal candidates than any other industry or profession. Their ability to keep tort reform out of the health-care reform bills is unsurprising: Congressional campaign contributions by lawyers in the last election cycle were about $25 million more than the combined total of political donations from doctors, pharmaceutical companies, HMOs, hospitals and nursing homes.
While some of these campaign donations come from defense lawyers (who also profit from the litigation status quo) giving by plaintiffs attorneys is far higher per lawyer (16 to 120 times greater, depending on the firm, according to Manhattan Institute estimates), and more tightly focused. Over the current six-year senatorial election cycle, four of the top seven donors to the campaign committee and leadership PAC of Senate Majority Leader Harry Reid (D., Nev.) were plaintiffs firms. Plaintiffs firms were the top two donors to Senate Majority Whip Dick Durbin (D., Ill.).
I go on to list some of the goodies the trial bar has been getting out of Congress, as well as some of the top items on its wish list, many of which will be familiar to the regular readers of this site.
Moreover, I argue that the political power of the plaintiffs' bar is integrally linked to the post-Buckley campaign-finance regime: "Contribution limits favor those best able to 'bundle' donations. The plaintiffs bar, with thousands of well-heeled members willing to write $2,000 checks, is well-situated to play this game."
My op-ed today summarizes arguments and facts presented in much more detail in the Center for Legal Policy's newest installment in its Trial Lawyers, Inc. series, Trial Lawyers, Inc.: K Street--A Report on the Litigation Lobby 2010, which will be available later today here.
"A railroad company's dogged pursuit of conspiracy and fraud charges against an asbestos law firm is unfolding in a federal appellate court and with a major assist from business and tort reform groups." [Marcia Coyle, NLJ]
Colorado House Bill 1168, which restricts subrogation by insurers who have paid for an accident victim's injury, would drive up insurance premiums and not coincidentally benefit trial lawyers, argues Mark Hillman in the Denver Post.
He has argued that workers should be allowed to choose only between unions, not between a union and no representation, and he wants employers to be banned from even attending NLRB hearings about union elections. On the subject of the NLRB itself, he has gone so far as to write that "employers should have no right to be heard in either a representation case or an unfair labor practice case, even though Board rulings might indirectly affect their duty to bargain." In other words: "Shut up."
"Study says genetics, not environment, may be cause of S. Boston scleroderma cluster"
Posted by Walter Olson
Another suspected toxic-exposure cluster goes the way of the Long Island breast cancer scare and many other epidemics-that-weren't [Boston Globe via Fumento/CEI]
The veteran California political columnist describes what the governor is trying to do, but offers this blunt assessment: "Don't hold your breath. The Legislature's Democratic majority is symbiotically welded to the trial bar." [Sacramento Bee first, second columns via Pero, earlier]
U.K.: law firm introduces personal injury iPhone app
Posted by Walter Olson
"If you just can't get enough of personal injury ads on daytime TV, then Bott & Co solicitors has launched a new iPhone application designed to win compensation should you suffer a car crash or 'incident.' Would be claimants will get instant access to a personal injury solicitor if they have been involved in an accident with the 'Car Incident Assistant' application." [MacWorld UK; Bott & Co., PR Newswire]
European companies outraged at S.D.N.Y. apartheid reparations case
Posted by Walter Olson
Germany's Daimler -- which is also objecting to the South African government's turnabout on the suit -- and Barclays Bank are among those protesting the creative legal theories. Earlier here.
More: Princeton Lyman (Council on Foreign Relations), NYT op-ed. And also on the Alien Tort Statute, here's a YouTube video in which Linda Kelly, director of legal education programs for the Searle Center on Law, Regulation, and Economic Growth at Northwestern Law, discusses the center's efforts related to the statute.
Illinois high court strikes down malpractice limits
Posted by Walter Olson
It's for the third time, and confirms that the court simply will not be bound by the duly enacted acts of the legislature when certain issues important to its lawyer constituency are at stake. I made these comments for the Heartland Institute:
"The court's supposed separation of powers rationale simply can't be taken seriously. Legislatures pass new laws prescribing the legal consequences of civil breaches all the time, and no one imagines that the court would have struck down this legislative intervention had it expanded damages as opposed to limiting them.
"At this point, if Illinois wants to put the voters and their representatives back in charge, it will need either to alter its constitution or--perhaps a better idea--alter the composition of its supreme court."
On page 21 of its opinion, the court has to confront the fact that the Illinois legislature has often limited common law damages in other circumstances without being found unconstitutional. An Innkeeper's Protection Act, for example, limits the liability of hotel owners to a fixed sum no matter what the value of the goods lost by the guest. The court absurdly seeks to distinguish this instance by noting that the innkeeper statute "also allows the parties to contract around the statutory limit." As if it would have upheld malpractice limits had they been paired with an option of contracting around the statutory limit!
The court's decision yesterday, like its earlier two decisions striking down medical liability limits, is lawless. It is best understood as a peremptory act of will and a power play in the familiar, if ugly, tradition of Illinois politics.
...The court threw out a sound law that has worked. The court threw out a sound law and essentially told the state's lawmakers: Don't even bother to try this again. ...
Justice Lloyd Karmeier, joined in a dissent by Justice Rita Garman, wrote that the court's wisdom in that previous decision "has not only been rejected by the federal courts, it has failed to carry the day in any reported decision in any other state in the United States since it was filed 12 years ago."
Nobody has recognized the wisdom of the Illinois Supreme Court on this matter ... except the Illinois Supreme Court.
OSHA cannot admit its goal is a new ergonomics rule because the agency would run afoul of the Congressional Review Act used to revoke the 2001 regulation. The law stops agencies from re-promulgating disapproved rules without specific legislative approval. [Section 801(b)(2)] Comments from OSHA officials on the possibility of a new ergonomics rule have been all over the map. (Earlier Point of Law posts.) But the Naderites at Public Citizen were not so restrained in the group's release praising the new musculoskeletal mandate:
OSHA states that this recordkeeping change does not imply that the agency will issue a standard related to musculoskeletal injuries and illnesses, commonly known as an ergonomics standard. Public Citizen believes such a standard is needed and urges the agency to issue one without delay.
Apropos Public Citizen, NPR's "Morning Edition" today carried a lengthy report on Toyota's troubles and the role of the National Highway Traffic Safety Administration (NHTSA). The primary interview for the report was Joan Claybrook, identified only as a former head of NHTSA during the Carter Administration -- a scanty description for a woman who targeted the auto industry for two decades as head of Public Citizen. NPR lionized her last August with a piece, "Consumers' Crusader Joan Claybrook Steps Down."
The "Morning Edition" story also brought up the usual allegations of a "revolving door" -- lobbyist to official to lobbyist, with the Bush Administration being the point of complaint. OK, but wouldn't it then warrant mention that the current head of the NHTSA, David Strickland, is a former lobbyist for the American Association of Trial Lawyers? The trial lawyers' lobby, now American Association for Justice, is offering materials to its members designed to aid them in litigation against the car company.
Federal prosecutors in the Africa-scam case are alleging that the nearly two dozen arms-dealer defendants were part of a single conspiracy, which if accepted would make the case a lot easier to press. Notes FCPA Blog:
But will the single-conspiracy approach set up the entrapment defense? Reuters quoted two defense attorneys as saying "they believed their clients barely knew each other beyond perhaps an occasional handshake when their paths happened to cross in the industry." That suggests some defendants might argue they were a group of strangers recruited into an illegal conspiracy promoted and run entirely by the feds and their mole.
Penn State is doing an Iqbal/Twombly symposium next month [Workplace Prof]
Plaintiff's prior back injury no bar to sustaining of Bronx jury's $1.5 million award for subway slip [Hochfelder]
Oklahoma AG Edmondson: Don't blame me for setting up my lawyer friends in chicken farm case, courts threw out the theories on which they'd have gotten rich [Muskogee Phoenix]
Advocates push for "workplace bullying" law in Massachusetts [Fox]
"A California appeals court has ruled that Waters & Kraus, one of the nation's leading asbestos litigation firms, did not engage in 'judicially sanctioned extortion,' as a Los Angeles trial judge contended last year." The trial judge had been highly critical of the "asbestos two-step" practice of filing in Texas in order to take advantage of favorable discovery rules, dismissing the case, and refiling in California. [Amanda Bronstad, NLJ; earlier here, here, and here]
A ruling on the First Amendment? We'll introduce legislation!
Posted by Carter Wood
In the week following the Supreme Court's decision in Citizens United v. FEC, members of Congress introduced 10 pieces of legislation to limit the impact of the decision. (List here.) Other bills had been introduced before the decision, as well.
In his prepared statement today at a hearing by the House Judiciary Subcommittee on the Constitution, Civil Rights, and Civil Liberties, Sean Parnell of the Center for Competitive Politics of Alexandria, Va., explained that the legislative approach is fundamentally flawed.
Among the options that are unlikely to be permitted by the Courts would be any sort of tax levied on the exercise of a constitutional right, as proposed in H.R. 4431, or the enactment of legislation that would simply restore the pre-Citizens United status quo through the back door such as H.R. 4435, a bill that would apparently forbid companies listed on stock exchanges from engaging in independent expenditures....[snip]
[The] Courts are likely to be skeptical of laws and regulations that impose burdens upon only some disfavored incorporate entities while leaving other, favored speakers free of similar burdens. For example, laws that require for-profit corporations to seek shareholder approvals for expenditures, such as H.R.s 4487 and 4537, might be struck down in court because no similar requirement is imposed on unions or other non-profits.
The others testifying ...
Laurence H. Tribe
Carl M. Loeb University Professor, Harvard Law School, Cambridge, MA
Monica Y. Youn
Counsel and Director of the Campaign Finance Reform Project
Brennan Center for Justice, New York University School of Law, New York, NY
Donald J. Simon
Partner, Sonosky, Chambers, Sachse, Endreson & Perry, LLP
Washington, DC
If this ruling is left unchallenged, if Congress fails to act, our country will be faced with big, moneyed interests spending, or threatening to spend, millions on ads against those who dare to stand up to them. The threat alone is enough to chill debate and distort the political process in ways that hurt the voice and influence of the average citizen.
Stopping those big bonuses by bailed out firms? Forget about it. Pushing back against polluters to protect the health of our children? No more. Regulating dangerous chemicals in drugs and children's toys? Much less of a chance.
This opinion can allow foreign interests to influence our elections, special interest
spending to go unchecked and undisclosed, and corporate America to rule the day.
Sen. Robert Bennett (R-UT), the only Republican Senator attend the hearing, gave an opening statement that eschewed hyperbole for expression of principle: "This decision means one thing and one thing only - that there will be more free speech in our political campaigns. That is a good thing. It should not be feared. It should be cheered and celebrated."
The hearing webpage has video of the hearing and links to the prepared testimony. We've also posted the links in the extended entry section below.
Also, a House Judiciary subcommittee held a hearing on Citizens United this morning, and the prepared statements are posted here.
Plus: Heritage has a panel discussion tomorrow in Washington, D.C. on "The Impact of the Citizens United Decision on Federal Elections." And Ilya Shapiro at Cato-at-Liberty explains why "When Individuals Form Corporations, They Don't Lose Their Rights."
Powering New England at permanent recession levels? Pollution suit seen as bid to close Salem Harbor coal-fired utility plant [Boston Globe] Opponents seeking immediate closure of Vermont Yankee nuclear plant [WCAX]
Updated: Readers of Point of Law have knownaboutmany of these specifics for years, but here comes another wave of major media coverage: the Wall Street Journal weighs in with a front-page news account on the contributions and other cozy relations between politicos in Ohio, Massachusetts, Rhode Island and elsewhere and leading class action firms. And it quotes a dissident in the class-action ranks:
"Plaintiffs' lawyers donate because they think it buys them access to people who make decisions over how pension funds select counsel," says Fred Isquith, a partner at Wolf Haldenstein Adler Freeman & Herz LLP, a plaintiffs' firm in New York. Such giving "creates an appearance of complete impropriety," he says, and "should be outlawed."
Earlier: A Washington Times editorial reviews some eyebrow-raising episodes in outside-counsel-hiring by the past or present attorneys general of California, New Mexico and Alabama.
Setting California bounty-hunters against insurers
Posted by Walter Olson
On hold just temporarily, or dead for this session? "On January 6, Assembly Member Marty Block pulled his bill, AB 989, before it could be heard before the Assembly Insurance Committee. The bill would have let private lawyers become self-deputized vigilantes and go after insurance companies to get damages and -- no surprise -- attorney's fees. It would allow lawsuits against insurers by anyone alleging to be harmed -- including people who aren't even policyholders." [California Civil Justice; background from John Sullivan, Capitol Weekly]
Now Richard Blumenthal is demanding that Connecticut, not Maine, labor be used on a bridge project financed by federal stimulus money. On what legal basis? [Legal NewsLine] It's the latest of numerous ways the oughta-be-controversial AG has seemingly put the power of his office at the disposal of labor unions.
The Justice Department is looking for test cases to expand its antitrust authority. And the FTC wants to circumvent the courts' narrow interpretation of the Sherman Act by reclaiming a legal tool it has hardly used in more than two decades--Section 5 of the 1914 law that created the agency.
Invoked in the FTC's Intel suit, that law allows the FTC to act against a company that engages in "unfair methods of competition." The law largely fell into disuse after courts repeatedly slapped down the FTC for using it too broadly.
Criminalizing Corporate Conduct: How Far Is Too Far? The forum features an exchange between John Hasnas, an associate professor of business at the
McDonough School of Business at Georgetown University, and Mike Seigel, Professor of Law at the University of Florida College of Law.
Trial Lawyers Inc: Asbestos
The Center for Legal Policy is proud to release the newest edition of Trial Lawyers Inc. series.
Asbestos, once thought to be a "magic mineral," ended up causing thousands of deaths of those exposed to the substance. Likewise,
litigation that originally sought redress for the truly injured, has metastasized into a big business that recruits sham victims
to beef up the plaintiffs' bar's bottom line.
On Monday, June 8, 2009, the Manhattan Institute hosted a forum featuring Home Depot co-founder Ken
Langone and former attorney general of the United States Dick Thornburgh. In a structured interview
format, Chief Executive editor-in-chief J.P. Donlon asked Mr. Langone and Mr. Thornburgh for their
analysis of the criminalization of corporate conduct. The program will be adapted for publication in
Chief Executive magazine. EVENT VIDEO >> PODCASTS:
Jim Copland, director of the Center for Legal Policy, interviewed both Ken
Langone and Dick Thornburgh on their thoughts about the
over criminalization of corporate conduct from the legal and business perspectives.
PODCAST:
Jim Copland, director of the Center for Legal Policy, interviews Ilya Somin, assistant
professor of law at George Mason University School of Law, on Sonia Sotomayor's judicial
record regarding property rights. Click here to listen to the podcast. ARTICLES: What of impartiality?, Jim Copland, National Law Journal, 06-01-09 Obama's 'Wise Latina', Walter Olson, Forbes.com, 05-26-09 Judge Sotomayor's not-so-liberal moments, Marie Gryphon, Washington Examiner, 06-03-09 TELEVISION:
Jim Copland on WABC's "Tiempo", 5-31-09. [Part I] [Part II] [Part III] [Part IV].
Jim Copland on NY1's "Road to City Hall", 5-26-09
Jim Copland on PBS "Newshour with Jim Lehrer", 5- 26-09. [Part I] [Part II]
ARTICLE: Mandatory labor arbitration, Richard A. Epstein, Washington Times, 03-24-09 (This article is also linked on RealClearMarkets.com, 3-24-09) PODCAST:
Click here to listen to Jim Copland, the director of the Center for Legal Policy, interview Richard Epstein about the problems with the Employee Free Choice Act.
FEATURED SITES:
The Center for Legal Policy was honored to host a special series of lectures on law, litigation, and state power by distinguished visiting scholar Richard Epstein in the fall of 2007. Professor Epstein discussed each of his lectures in podcast interviews with James Copland, director of the Center for Legal Policy.
PREVIOUS FEATURED DISCUSSIONS: November-December 2006 ELECTION ROUNDTABLE Point of Law editors and guest contributors discuss the 2006 election as it relates to legal reform.
September 2006 WHO'S THE BOSS Gordon Smith and Stephen Bainbridge discuss whether shareholders or directors should have primary control of corporate governance.
July 2006 MEDICAL JUDGMENT Ted Frank and Peter Nordberg discuss whether the principles of the business judgment rule should apply to medical malpractice.
May 2006 Lawyer Licensing Jonathan Wilson and Larry Ribstein discuss the merits of legal ethics rules requiring a license to practice law.
April 2006 CONTINGENT CLAIMS Jim Copland and Alex Tabarrok discuss limiting contingency fees for plaintiffs' attorneys.
February - March 2006 SELLING SHORT Moin Yahya and Larry Ribstein discuss how the government should handle plaintiffs' short selling of the companies they sue.
November - December 2005 CONDITION CRITICAL? Bill Sage and Jim Copland discuss the effects of litigation on American medicine, in reaction to MI's Trial Lawyers, Inc.: Health Care report.
July - September 2005 SUPREME COURT NOMINATION Richard Epstein and Stephen Presser discuss the Supreme Court's future.
January 2005 ELECTIONS AND SELECTIONS Alex Tabarrok and David Rottman discuss judicial election and selection systems.
October/November 2004 MALPRACTICE PRESCRIPTIONS A panel comments on Daniel Kessler's paper on medical malpractice liability reform.
September 2004 ELECTION 2004 Bush and Kerry supporters discuss their candidates' positions on malpractice reform.
August 2004 FEE-DING FRENZY Lester Brickman and Richard Painter discuss contingency fee reform.
July 2004 SMOKING GUNS Walter Olson and Michael Krauss discuss federal gun lawsuit legislation. ARCHIVED COMMENTARY: Supreme Court Confirmations Contact Us: Manhattan Institute 52 Vanderbilt Avenue 2nd Floor New York, N.Y. 10017 phone: (212) 599-7000 fax: (212) 599-3494 mi@manhattan-institute.org Media Inquiries: Lindsay Young Craig Vice President, Communications and Marketing communications@manhattan-institute.org
