This morning, the U.S. Supreme Court released Caperton v. A.T. Massey Coal Company.  The case involves facts that are almost too extreme to believe.  Massey was appealing a multi-million judgment and decided to help its chances at the West Virginia Supreme Court by spending approximately $3 million to help elect a new supreme court justice.  After the court, with the new supreme court justice, threw out the award, the plaintiff appealed, arguing that it was deprived of its right to trial. 

In the ruling, the Supreme Court agreed with the plaintiff and held that courts shouldn't rule on cases involving large donors.  Unfortunately, the opinion doesn't provide much more guidance than that.  So what does that mean for Texas?  Texas has judicial elections, and most campaign contributions come from those with cases before the Court.  A Texans for Public Justice study concluded that in the last Supreme Court election, the candidates received more than 65% of their contributions from those with business before the Court.  And it wasn't just a Republican or a Democratic issue, both sides were equally guilty.

So where do we go?  Do we see a lot more motions to recuse or will the decision provide the impetus needed to those that support abolishing judicial elections. 

It's hard to know until the dust settles.  Once the decision and its lower cases interpreting it are fleshed out, there might not be any change at all.  On the other hand, it might make all the difference in the world. It will at least be interesting to watch as it plays out.

It's no secret that I'm not a fan of mandatory, pre-dispute arbitration.  In fact, I've probably written on it more than anything else  (see my prior posts here, here, here, here, here, here, and here).  Now, maybe the griping from me and others has done some good.

A Los Angeles Times story was out earlier in the week detailing the problems with pre-dispute arbitration and noting that there is finally a chance that something may be done to help consumer.  The column noted:

Consumer advocates, sensing a shift in the political winds under President Obama, believe the time is right to challenge mandatory arbitration and have banded together to support legislation ending the practice.

We have no problem with arbitration," said David Arkush of the watchdog group Public Citizen. "We just want people to be able to choose it if they want it, rather than having it be required."

The article also noted that the public's acceptance of arbitration might be changing.  It noted that when the details of mandatory, pre-dispute arbitration are explained to people, 59% of Americans say they oppose it.

I'm glad to finally see the issue discussed in the popular press and to see that the tide may be turning.  While I think there are many cases where arbitration is appropriate, I think consumers deserve the right to fully understand the agreement before signing it;  they deserve to know the costs of arbitration, that they may be giving up their rights to conduct discovery, and the pros and cons of arbitration before they're forced to agree to it.  In today's setting, consumers don't get that.  Businesses get pre-transaction lawyers to explain the arbitration agreements and to draft the agreements for the businesses.  But there isn't any protection or explanation for the consumer.

I think the author summed up my concerns nicely:

Seems to me that if arbitration is indeed fair to everyone, it shouldn't have to be crammed down consumers' throats. Arbitration should be offered as a cost-effective and relatively speedy alternative to litigation. But it should be just one option available, just as filing a lawsuit should be an option.

By the same token, no company should be permitted to deny customers their right to a jury trial or to participate in class-action lawsuits.

In a perfect world, such things wouldn't be necessary.

As trial lawyers, we've been blamed for a lot of stuff over the last ten years, but today brought a new one.  Today, conservative columnist Jonah Goldberg wrote an editorial blaming the "pirate problem" on lawyers.  But not just any type of lawyers.  Goldberg would never miss the chance to slam us, trial lawyers.  Goldberg writes:

And that raises the primary reason this all seemed so complicated. Lawyers. Layers and layers of lawyers. Bret Stephens asked in a prescient Wall Street Journal essay last November, “Why Don’t We Hang Pirates Anymore?” And the answer, he discovered, is that “there is no controlling legal authority.” A combination of international and domestic law has made dealing with what Cicero dubbed “hostis humani generis” — enemies of the human race — just too darn complicated.

Add to this the fact that trial lawyers, bureaucrats and accountants for too long have conspired with corporate honchos to make paying ransoms the least costly option. Shipping companies don’t want their crews armed to defend themselves.

It's almost comical, except Goldberg seems serious about it.  But I guess he didn't really consider the facts before testing out his theory.  According to Goldberg himself, there has now been one American flagged ship and crew taken by pirates in the last 200 years.  And that band of pirates was "taken care of".  That doesn't sound like a "pirate problem" to me.  That sounds like an isolated incident. 

Now, I'll admit that overall a pirate problem exists.  Pirates are taking ships at an alarming rate.  But they're not American vessels.  And I don't think even Goldberg would claim that American trial lawyers are responsible for attacks on foreign ships.  But he conveniently leaves all this out.  It's much easier (and much more fun) to take another cheap shot at trial lawyers.

A numb er of years ago, while I was in law school, I received a call from my mom, and she started asking me about the elements of a criminal assault case in Texas. I don’t know about all of you, but this was not the question I expected from my mom. I asked her why she wanted to know, and she replied, "I have jury duty, and we’re trying to decide whether to convict the defendant."

"Didn’t you get an instruction not to talk to anyone about the case?" I asked. "Yeah," she replied, "but I didn’t think that applied to you."

And that’s how it goes. Despite judges’ best attempts to instruct jurors not to look to evidence outside the case, jurors have always found a way to do it. But now, with the internet and smart phones, it seems that ignoring judicial instructions is becoming too easy. Yesterday’s New York Times discussed the trend of "Google mistrials" that are sweeping the nation, creating a firestorm in the last two weeks.

Last week, a mistrial was granted during the middle of an eight week federal drug trial in Florida after nine of the twelve jurors admitted to using the internet to do research on the case. Also last week, a defendant in a lawsuit said it plans to appeal a $12.6 million verdict rendered against it after a juror used Twitter to send updates during the trial. And this week, defense lawyers for former Pennsylvania state senator Vincent Fumo asked that a guilty verdict be thrown out after one of the jurors in that case used Twitter and Facebook to send updates.

So the question is, "where do we go from here?" In my opinion, there are two separate issues. The jurors using Twittering and the Facebook don’t really concern me that much. In most cases, we’re talking about 6 or 12 jurors on the eventual jury. It shouldn’t be difficult for the court or the lawyers involved with cases to monitor the Facebook or Twitter pages of 6-12 people during the course of the trial. And I suspect that if the judge gives the jurors an instruction not to use Facebook or Twitter and also tells the jurors that court personnel will be monitoring their accounts to make sure the jurors are following the instruction, that the number of posts or tweets will drop off dramatically. Now, there might be some jurors with anonymous accounts that are hard to find, but I think those would be a very small minority.

The bigger concern for me is the potential for jurors to perform internet research. There’s just no way to police jurors and stop internet research. I think the best judges can do is to instruct the jurors about the problems and then just hope for the best.

On the other side of the ball, the lawyers involved have to know that the jurors could potentially be researching the case via Google. That probably means we’ll have to have some other considerations in the way we try the cases. I’m not sure what form that would take, but at a minimum, we need to have staff members perform popular searches about the parties and the case so that at least we know what’s available to the prospective jurors.

Anyone else have thoughts on these matters?  I'd love to see the thoughts as a comment or you can send them to me on Twitter  (@bschuelke).

"A judge's job is to apply the law and, in the absence of a jury, to decide the facts of the case.  This job description should not include advancing a personal or partisan agenda from the bench.  When a judge brings a personal agenda or partisan commitments to the bench, the rule of law suffers, and invariably public confidence in our system of justice is undermined."

That's a great quote; one that you might expect from a constitutional law scholar or something.  But you wouldn't expect it from a former judge who was a prime example of putting a partisan agenda before the law.  And yet, that's exactly what Senator John Cornyn did this week in a commentary he wrote for Texas Lawyer magazine.  (I guess I shouldn't be surprised, this is the same guy that wants to use Texas, the state with the highest rate of uninsured in the country, as a model for the nation on healthcare.)

Perhaps forgetting (or hoping to ignore) his record as a judge, Cornyn addresses judicial selection, a hot topic in Texas.  Texas is one of the few states that allows election of judges by political party, and some are questioning whether that should be changed.  And the criticism comes from both sides.  On the consumer side, groups such as Texas Watch have been calling for reform for years, and now, after Democrats swept through the courts in Dallas County and appear to be heading the same way in Harris County, Republicans are jumping on the bandwagon too.  In his "State of the Judiciary" speech, Judge Wallace Jefferson spent a lot of time talking about the problems with partisan elections, even though some say Jefferson's Texas Supreme Court exemplifies the biggest problems with the judiciary.

While many of us agree that partisan elections are bad, there is a lot of disagreement over the best alternative.  Right now, the darling of the politicos is the prospect of merit selection where the governor appoints a judge and then the judge faces retention elections later. 

I say, "no thanks."  We don't need judges beholden to the governor or any other branch of the government. Incumbents already win an extraordinary high percentage of the time.  We don't need a governor (of any party) picking judges that are hard to oust.

What do I think we should do?  I suggest non-partisan elections.  Get the "R" and the "D" off the ballot, and let people make decisions based on merit.  I'll talk about the reasons why I like this over the next few days.    

We have a weird criminal proceeding occurring here in Travis County. In 1986, 26 year old Timothy Cole was convicted of rape by a Lubbock County jury and sentenced to 25 years in prison. Cole maintained his innocence throughout the trial. In 1995, another prisoner confessed to the crime, but no one really took notice until 1999, when Cole died in prison. At that time, the state called the victim and informed her that Cole had died from complications from asthma. She told the officials she was surprised because her attacker was smoking throughout the attack. And yet nothing happened.

In 2007, authorities finally began listening to Jerry Wayne Johnson, the inmate that had confessed to the crime, and last year DNA testing, under the guidance of Barry Scheck’s Innocence Project, confirmed that Johnson was the attacker. While the DNA test was satisfying, Cole’s family wanted his name cleared.  Unfortunately, Lubbock County refused to do anything about it so in stepped Travis County District Judge Charlie Baird.

Judge Baird is one of the more progressive judges we have. For example, Judge Baird has personally recruited businesses asking them to help give criminal defendants better jobs. He’s also set up a parenting program that offers Saturday parenting classes to some of his probationers, even going the extra step of paying for the program out of campaign funds and attending the weekend sessions with the participants. (To read more about him, you can check out articles from the Austin Chronicle and the Austin American Statesman.)

Judge Baird is conducting a two day hearing to clear Cole’s name. Judge Baird contends that the Texas Constitution requires courts to remedy a wrong they have caused (for a different viewpoint, see Paul Kennedy’s post "Is Innocence a Bar to Execution?"). At the end of the hearing today, Timothy Cole is likely to become the first Texan to be posthumously cleared of a crime.

But it also struck me that Cole’s conviction is a great example of the dangers of eyewitness testimony. Cole was convicted primarily on the identification of the victim, who picked Cole out of a "lineup" (I use that term loosely; she was apparently given a color photo of Cole and black and white photos of other potential perpetrators.).

For years, experts have been concerned about the reliability of eye witnesses (a famous study on the issue that looked at eye witnesses’ reliability in recall information regarding car wrecks was published way back in 1978). And during yesterday’s hearing, attorneys from the Innocence Project called as an expert witness, Mike Ware, a Dallas County prosecutor. As you may know, Dallas County has seen 19 people exonerated through DNA testing in the last couple of years, and Ware said that all but one of those cases involved a mistaken identification.

It’s known that eye-witness testimony is a problem, and yet it still remains the holy grail in the courtroom. What are we as lawyers supposed to do about that? I don’t really have any answers, just a lot of questions.

In 2003, the Texas Legislature changed the landscape for residential construction litigation. They created the Texas Residential Construction Commission (TRCC)and also set up a "dispute resolution process" that most construction defect cases had to go through before proceeding in the court setting. The law is a disaster for homeowners. Cases sit in the process for ridiculous amounts of time and there is no real mechanism to enforce any finding of wrongdoing by the builders. In short, builders love the bill; homeowners hate it. It is such a resounding success that the staff of the Texas Sunset Commission (which reviews state agencies) issued a scathing report calling for abolition of the Commission, though the Commission itself voted in December to recommend keeping it with significant modifications. 

It was apparently such a success that some legislators want to expand the provisions.  I received a draft of a bill today  (download it here) that has not yet been filed, but it would create a system similar to the TRCC for commercial construction disputes.  However, it goes further; instead of the ridiculous "dispute resolution process" in residential claims, the new bill appears to require arbitration for any dispute relating to a commercial construction defect, potentially including personal injury claims (though the bill itself is vague).

I don't do commercial construction cases, but I do handle personal injury claims resulting from commercial construction defects.  Frankly, I'm appalled, and I hope all other lawyers would be too.  The legislature has done some ridiculous things, but even in the egregious medical malpractice limitations they didn't seek to take away the right to a jury trial. 

I'll be tracking this bill and trying to keep the status updated.

I'm a few days behind on my magazines (actually, more than that judging by the pile on my desk) so I just got around to reading my January 5, 2009 Texas Lawyer, which contains an article entitled  DOWN MARKETS REQUIRE CREATIVE CHOICES: Use Flexible Fee Structuring To Add Clients In Tough Times.

In the article, the author, Philadelphia lawyer Gavin Lentz, makes some great points.  He states:

While many law firms seem to be bracing for disaster in this market, I see an excellent opportunity to generate new clients while also building an upside into your fee agreements. Although the current economic conditions are causing an explosion of litigation, many clients are experiencing extremely tight cash flow and cannot afford the usual fee structures.

Under these circumstances, how do you turn this to your advantage? The answer is multiple types of flexible-fee agreements that both new and existing clients will greatly appreciate. Firms that refuse to be flexible and creative in a down market risk losing clients and enhanced fees. I have already seen a number of clients that have been turned away by other firms because those lawyers are not taking the long-term view regarding client relationships and the economy.

Although current budget conditions may preclude clients from paying typical initial retainers and monthly fees, I have found that you can solidify your relationship with both new and existing clients by negotiating an upside reward for taking a risk to help clients through these difficult times.

To meet these problems, Mr. Lentz suggests using multi-phased fee agreements (flat fees based on portions of cases) or blended contingency agreements (client pays an initial flat-earned fee and then a percentage of the recovery after that).  But Mr. Lentz doesn't go all the way.  Why doesn't he ever suggest taking a case on a full contingent fee?  There are plenty of lawyers (including our firm or my friend Randy McClanahan who has a contingent fee blog) that routinely take commercial matters on a contingent basis.  And many of us have been doing it for years, not just now when times are tough.

Don't get me wrong.  There are times and places for hybrid agreements (we've used all kinds of hybrid agreements in our practice), but leave open the possibility of a full contingent fee.  If you want to alilgn the interests of the attorneys and the clients, the best manner, when possible, is a full contingent fee.

Even though he and I don’t agree politically, I generally like George Will. In fact, I even did a school report on his book, The Morning After. But his agreement in Sunday’s piece Litigation Nation with Phillip Howard’s Life Without Lawyers: Liberating Americans From Too Much Law is wrong.

In a utopian society, maybe those of us that represent plaintiffs in personal injury or commercial litigation cases might not be needed. But this isn’t a utopian society. This is a country where:

I would think that in the age of Enron, Worldcom, stories of widespread mortgage fraud, and Bernie Madoff, people would be running away from a system of caveat emptor; not running toward it. The sad fact is that this country needs lawyers and the civil justice system. It is no coincidence that James Madison said, "Trial by jury in civil cases is as essential to secure the liberty of the people as any one of the pre-existent rights of nature."

Now, are there frivolous lawsuits that shouldn’t be brought? Sure. But there are also frivolous defense — when defendants or their insurers assert ridiculous defenses to try and avoid paying legitimate claims.  Both are byproducts of a critical system, and the system allows judges to sanction those claims if the judges hearing the cases are willing to do so. 

And are there overreactions with ridiculous warnings or rules trying to limit suits?  Sure (who doesn't think that a products claim brought by someone swallowing a fishhook wouldn't be thrown out?).  But don't throw the baby out with the bathwater.  Fault doesn't necessarily lie with the civil justice system, but with those assigned with trying to figure out how to respond to claims.  While the school officials at Broward County chose to ban running at recess (as Will mentions), there are thousands of schools across the country where children are allowed to run free and play on fully functioning playgrounds during recess.  Is a bone-headed decision by a school district an indictment of the civil justice system or of the school district making the decision?

I’ll also add that readers should be cautious about reading stories based on anecdotes alone (as Will’s is). In my experience, there are always two sides to an anecdote or even instances where the anecdote never happened (see the common Stella Awards). For instance, Will mentions a seemingly frivolous lawsuit that was settled for $90,000.00. I don’t find a lot of defendants throwing $90,000.00 at frivolous claims. Will also mentions a claim by a child that broke his leg sliding down a slide head-first. Frankly, I’m not sure how that could happen absent some additional facts that might explain why a claim was made.

For an in depth look at Will's anecdote of a supposed run-a-way jury, read Maxwell Kennerly's blog post.

Attorney and CBS News analyst Andrew Cohen had a great opinion piece Saturday calling out the US Chamber of Commerce entitled "Made in America: Corporate Gall --- On Corporations Seeking to "Reform" the Very System They Broke." 

It's an oustanding article, and I would cut and paste the entire thing if I wasn't afraid of violating copyright laws.  Instead, here's the introduction:

Like the child who kills his parents and then begs for mercy because he is an orphan, the U.S. Chamber of Commerce now is begging President-elect Barack Obama to protect corporate interests in the nation's civil litigation system as a way of restoring jobs and bolstering an economy shattered largely (as we now know) by corporate greed and misfeasance.

Talk about your gall.

I encourage anyone interested in the civil justice system to click the link and read the entire article.