Corporations, Securities & Antitrust and Telecommunications & Electronic Media Practice Groups Podcast
One of the Federal Trade Commission’s key duties is to protect consumers from deceptive advertising. The FTC does this, in part, by ensuring that advertisers can substantiate their claims. While executing this duty, the FTC generally seeks to prevent consumer harm while maximizing the amount of useful information available to consumers. Commissioner Maureen Ohlhausen believes that, in some cases over the past several years, the FTC has required a heightened level of substantiation, thereby reducing the useful information available to consumers. In a recent decision, POM Wonderful, the D.C. Circuit offered additional guidance on striking the proper balance, echoing themes that Commissioner Ohlhausen has raised in debates with her colleagues at the FTC. Commissioner Ohlhausen discussed this and other recent cases and how the FTC should address deceptive advertising in the future.
Litigation Practice Group Podcast
- Hon. Maureen K. Ohlhausen, Federal Trade Commissioner
The tragedy of asbestos continues to play out. The ensuing litigation has no counterpart in our history. Over 10,000 companies have been named as defendants, leading to 100 bankruptcies (and counting). While the litigation continues apace, it has undergone radical changes from the 1985-2003 period, when millions of nonmalignant asbestos claims, mostly of asbestosis, surged through the civil justice system. U.S. District Court Judge Janis G. Jack painstakingly documented that the litigation screenings which had generated approximately 90% these claims were permeated with fraud. As stated by Judge Jack:
"it [was] clear that the lawyers, doctors and screening companies were all willing participants [in a scheme] to manufacture. . . [diagnoses] for money."
Malignancies, most especially mesothelioma and lung cancer, account for a substantial percentage of the billions being paid out currently. Because of the unique nature of asbestos etiology and bankruptcies, trusts with assets of approximately $30 billion have been created from the assets of reorganized companies to compensate current and future victims of asbestos exposures.
Asbestos claimants today have two separate sources from which to seek compensation: claims against the trusts and suits against solvent defendants in the tort system. In “Fraud and Abuse in Mesothelioma Litigation,” 88 Tulane L. Rev. 1071 (2014), Professor Lester Brickman has examined the interplay between trust payments to claimants and tort claims. He presents evidence that plaintiffs and their counsel have routinely failed to identify exposures to the products of reorganized companies when suing defendants in the tort system even though they state, under oath, that the claimants had “meaningful and credible exposures” to the very products that plaintiffs have denied having exposed to in interrogatories, depositions, and trial testimony. Plaintiffs’ counsel steadfastly maintain that with a sole exception, there is no evidence that plaintiffs or their counsel have engaged in unethical or illegal conduct.
Recently, U.S. Bankruptcy Judge George R. Hodges, in In re Garlock Sealing Techs., 504 B.R. 71 (Bankr. W.D.N.C. 2014), found a “startling pattern of misrepresentation” “of exposure evidence,” thus sustaining Professor Brickman’s expert testimony in the Garlock bankruptcy. The committee representing the interests of plaintiffs and their counsel have appealed Judge Hodges’ Order.
The significance of Judge Hodges’ Order is yet to be determined. Already, Garlock has filed RICO actions against several of the law firms that obtained substantial payments from Garlock. Insurers and defendants are undoubtedly conducting investigations based on the revelations in Garlock and newly emerging evidence that may result in additional lawsuits being brought against plaintiffs’ counsel. If so, we may be entering a new era in litigation.
Professional Responsibility & Legal Education and Litigation Practice Groups Podcast
- Prof. Lester Brickman, Yeshiva University, Benjamin N. Cardozo School of Law
- Mark A. Behrens, Partner, Shook, Hardy & Bacon, L.L.P.
Steven Donziger, a self-styled social activist and Harvard educated lawyer, signed on to a budding class action lawsuit against multinational Texaco (which later merged with Chevron to become the third-largest corporation in America). The suit sought reparations for the Ecuadorian peasants and tribes people whose lives were affected by decades of oil production near their villages and fields. During twenty years of legal hostilities in federal courts in Manhattan and remote provincial tribunals in the Ecuadorian jungle, Mr. Donziger and Chevron’s lawyers followed fierce no-holds-barred rules. Mr. Donziger proved himself adept at influencing the media, Hollywood, and public opinion. He cajoled and coerced Ecuadorian judges on the theory that his noble ends justified any means of persuasion. And in the end, he won a $19 billion judgment against Chevon – the biggest environmental damages award in history. But the company refused to surrender or compromise. Instead, Chevron targeted Mr. Donziger personally, and its counter-attack revealed evidence of his politicking and manipulation of evidence. Suddenly the verdict, and decades of Mr. Donziger’s single-minded pursuit of the case, began to unravel.
Corporations, Securities & Antitrust and Litigation Practice Groups Podcast
On Monday, June 23, 2014 the Supreme Court issued a 9-0 decision in the highly anticipated securities fraud case Halliburton v. Erica P. John Fund. The case offered the Court an opportunity to revisit its 1988 decision in Basic v. Levinson, in which it adopted the “fraud on the market” doctrine. Fraud on the market is critical to modern securities fraud class action lawsuits -- the doctrine assumes that any misrepresentations of a security traded in an efficient market will affect that security’s market price and thus affect any shareholders trading in reliance of market price, an assumption that precludes consideration of whether potential class members actually heard and acted on fraudulent statements. The Court declined to overturn Basic; our expert discussed the reasoning and impact of the decision.
Little Rock Lawyers Chapter
- George T. Conway III, Partner, Wachtell, Lipton, Rosen & Katz
The Little Rock Lawyers Chapter hosted a debate titled "Is Tort Reform Conservative?" at the Arkansas State Capitol in the Old Supreme Court Room on June 24, 2014. Brian Brooks of the Arkansas Trial Lawyers Association and James Copland of the Manhattan Institute offered their contrasting views on the constitutionality of varying tort reform measures, and also shared their analyses on how those measures align with traditional conservative values.
- Brian Brooks, Counsel, Arkansas Trial Lawyers Association
- James R. Copland, Senior Fellow and Director, Manhattan Institute's Center for Legal Policy
- Moderator: Chad Pekron, Quattlebaum, Grooms, Tull & Burrow PLLC