Trial Lawyers, Inc. Targeting the Environment
August 26, 2010
Manhattan Institute’s indespensible series, “Trial Lawyers, Inc,” has done a tremendous job of exposing the business model and structure of the trial bar and quantifying the damage lawsuit abuse does to our nation.
A new installment has just been released in the series, this one on the environment. The report examines how trial lawyers are going green ($$$) by ginning up mass class action environmental lawsuits. According to the report, the trial bar is charging contingency fees that eat up a third of class proceeds and doing an end-run around legislator and regulators by using the courts to enact their policy aims.
Manhattan Institute’s Jim Copeland is the author of this latest report. Jim was published in yesterday’s Investor’s Business Daily with an op-ed on climate change lawsuits, based in part on the arguments laid out in this latest report.
Tort Reform in California: Do it for the Kids
August 19, 2010
California is facing a $19 billion budget hole this year and the possibility of (once again) issuing IOUs instead of paychecks to state workers. Furloughs may soon be back en vogue, and the state’s debt rating is flirting with junk status. No sacred cows are being spared with proposals to slash spending on everything from schools to health care services.
But there are some California workers who are doing very well, thank you. You guessed it: trial lawyers.
Our friends at California Citizens Against Lawsuit Abuse are out with a new study that examines the staggering amount of money that California public school districts are spending each year on litigation. The study, “Lessons in Lawsuits: The Impact of Litigation on California’s Schools,” examines three years’ worth of legal costs at 12 California public school districts - including verdicts, settlements and lawyer fees.
The result? Litigation cost those 12 districts nearly $100 million over three years. Tom Scott, CALA’s executive director, said that this money could have “paid the salaries of more than 1,530 teachers, purchased nearly 600 new school buses, bought more than 1.1 million school desks or purchased 246,762 desktop computer packages.”
Of course all these whopping legal costs have a dire impact on the education of California’s children. Here’s an excerpt from the report:
“In June, the state Department of Education identified a record 174 of California’s school districts that were financially troubled, up 38 percent from January. Across the state, tens of thousands of teachers were pink-slipped this year, told the funding for their positions – to educate the next generation of Californians – was unavailable. In Los Angeles, the L.A. Unified School District (LAUSD) has cut disabled children’s programs, including shutting down 200 classrooms and an entire campus dedicated to serving the disabled and reducing busing for these students. The Kern High School District (HSD) was forced to auction off and recycle items like buses and student desks to raise money for its general fund. Travel for athletic teams and field trips also have been eliminated.”
Those students in Kern County, CA might be interested to know that while they were seeing their desks auctioned off, the district was spending $2.3 million defending against lawsuits.
Sounds like a healthy dose of legal reform would be a good first step toward closing the yawning budget gap in the Golden State.
Green Eyeshades Present Gift to Trial Bar
August 18, 2010
Think that companies are going to be straining under the weighty disclosure requirements and regulations of the new Dodd-Frank financial reform? Or that our nation’s employers will be bogged down with the new health care reform law and its mandates? Afraid to consider the impact Cap and Trade legislation might have on the private sector…not to mention on the length of the Federal Register?
Ah, but wait – there’s more! The green eyeshade army is preparing to unleash a set of rules that not only ratchets up publicly traded companies’ compliance costs, but also opens the floodgates to a torrent of new litigation. Read more
Important New Study from RAND
August 9, 2010
The RAND Institute for Civil Justice is out with an important new study on the asbestos litigation morass, specifically:
- 54 asbestos bankruptcy trusts have been established through June 2010, “with an considerable acceleration in the number of trusts established in the second half of the 2000s.”
- 9 more trusts are in the pipeline, “with undoubtedly more to come.”
- In 2008, approximately 575,000 claims were paid at a cost of $3.3 billion. Read more
Worth a Look
July 29, 2010
Kevin Underhill, a partner at Shook, Hardy and Bacon, runs a great blog called Lowering the Bar dedicated to demonstrating that “legal humor” isn’t an oxymoron. Some of the most recent gems include this post on a lawsuit against a store that “failed to warn the plaintiff that playing with a sharp sword … would result in the plaintiff slicing his hand.” (h/t Walter Olson) Then there’s the $4.25 million verdict in the case of the missing pet turkeys in South Carolina. You gotta read it to believe it.
Mississippi’s AG Cavorting with Trial Lawyers
July 28, 2010
Today’s WSJ editorial page lifts the curtain on the way Mississippi Attorney General Jim Hood’s cozy relationship with the trial bar.
Trial Bar Tax Break?
July 15, 2010
Today’s WSJ editorial page reports on news coming of the trial bar’s annual confab currently underway in Vancouver, Canada. Apparently the trial bar lobby’s head of federal government relations proclaimed that the US Treasury Department will soon order a tax break for contingency fee lawsuits.
Whether the tax break will take the same form as the legislation that failed to pass Congress last year - proposed giving a 40% tax subsidy for up-front litigaiton cost - remains to be seen… the boys at Treasury are giving the “no comment” line.
The Importance of Getting the Right Judges
June 30, 2010
In a recent address, Patrick Hanlon of the University of California-Berkley School of Law noted that “critical tort reform” has helped reduce frivolous litigation, but – perhaps unintentionally – pointed out the importance of getting the right judges on the bench.
According to Hanlon:
“ … plaintiffs and their lawyers are still able to pick the best forum for favorable judges and juries sympathetic to their cases and more inclined to side with them in their tort actions. ‘Surprisingly, overall, judges seem to have had a much greater impact than the juries have in creating anti-business litigation environments,’ he pointed out.”
Could there possibly be a better argument for why businesses and their advocates should fight schemes like “merit” selection, which typically give legal special interests such as trial lawyers enhanced power to decide who will control our courts?
Litigation Costs Hurting New Jersey Schools
June 29, 2010
Think tort reform is a “business” concern? Read this article which reports on the toll litigation costs take on school district budgets.
“The average New Jersey school district allocates approximately $26,000 each school year for litigation expense. in seven districts, this figure was higher than $500,000 for the 2009-2010 school year.”
In one district - School District of the Chathams - legal expenses are budgeted to be $1.26 million for 2010-2011. This is the kind of money that could be spent on “textbooks and teachers and field trips and fund things for kids,” says the district’s business administrator.
Instead, it will go to lawyers.
Another Powerball Payday for Class Action Lawyers
June 29, 2010
That sound of champagne corks popping that you’re hearing may be coming from the party over at the Pomerantz Haudek law firm. WSJ’s Law Blog reports that the firm has just reeled in a $56 million fee in a securities fraud class action suit.
While trial lawyer fees in the tens of millions are par for the course in our nation’s jackpot justice system, that’s a 25% cut of the $225 million settlement. Fees typically are around 15% in major awards. In signing off on the fee, NY Federal Court Judge Nicolas Garaufis wrote,
“While it may be that a lower percentage would also be sufficient, this court will not pretend that it has the expertise necessary to divine the ideal percentage.”
In other words, “How much? Beats me! Party on, dudes!”