I can’t stand the thought of kids going hungry. That’s why I’m stepping up to help the Oregon Business Hunger Initiative. Summer is coming, and kids who rely on school meals are at risk for going without. I’m doing my small part to help fill the hole. The problems we face are bigger than any one of us, but even so, responsible businesses that band together can help fill in the gaps.

There are never enough thanks for the hard working people at the Oregon Food Bank.  But thanks are always due, even so. For anyone in a position to help, here’s more information on their Oregon Business hunger initiative.

David Sugerman

p.s. I’ll be off line in trial next week in Pendleton.  I’ll have very little time to respond to comments and emails next week.

Along with my colleagues, Houston attorneys Michael Doyle and Jeff Raizner, I filed an injury case here in Portland in federal court today for a group of Oregon National Guard soldiers against KBR, Inc., a private contractors. The soldiers were exposed to sodium dichromate while serving in Iraq in 2003. The compound contains a very toxic component, hexavalent chromium. The exposure problems have been widely reported in The Oregonian by reporter Julie Sullivan.

Our soldiers face a long road ahead. It is honor to represent them. Here is the link to a copy for anyone interested in the Complaint: complaint-and-demand-for-jury-trial-filed

David Sugerman

Just came across this informative article from Rust Consulting on claim rates in class action settlements.

It’s a bit geeky or at least specialized, but the issue is important for lawyers who handle class actions and judges who oversee them. And actually, it’s important to consumers and businesses, too.

The question is: When a class action settles, how many people who are entitled to recover money will actually file claims? The article correctly explains that the rates vary, but there are some factors that allow for a prediction.

The claim process is one of those misunderstood things that leads to a lot of complaints about class actions. When a class action settles, and a consumer gets a claim form that will yield $6.26, it hardly seems worth the effort. It also leads to complaints that the lawyers earned “millions,” but the consumer only got $6.26.

I suppose it’s a predictable response, but it’s simply wrong. That hypothetical $6.26 must be multiplied by the number of consumers to look at the value of the class recovery. In other words, the true measure of damages is how much did wrongdoer have to pay out?

The other thing that consumers often miss is that class settlements frequently leave unclaimed money to the wrongdoer. That’s a problem because the wrongdoer profits for every claim form not returned. That’s a good reason for consumers to make claims, as businesses that act illegally shouldn’t profit from their gains, even if those gains are $6.26 at a time. One way to think about it is that it’s easy to make millions in nickels if you simply illegally collect enough nickels. It’s also important to file claims so that we can all stop illegal shakedowns of the middle class that drag all of us down.

David Sugerman

This is for all tort reform advocates, like those smart folks at the Wall Street Journal, who spout the simplistic suggestion that a loser pay rule would improve the American civil justice system. The Times Online reports on Lord Justice Jackson’s lengthy report on the United Kingdom’s civil justice system. The upshot is that Lord Justice Jackson recommends ending the United Kingdom’s loser pays rule.

Leave it to The Times to get to the heart of the matter: “The civil justice system has priced itself out of the reach of ordinary people; they face financial ruin if they venture into court and lose.”

The issue is access to justice. In a loser pay system, only the wealthy can access the courts. That is so contrary to the American way. Let’s all mark this lesson as a response when the smart folks at the Wall Street Journal start pushing for limits that treat justice as a luxury item.

David Sugerman

It’s one of those cases that causes those of us who represent consumers to shake our heads. An affluent woman who has been bleaching her hair since childhood sues an upscale salon for botched hair treatment. She seeks $50,000 in humiliation damages, plus substantial out-of-pocket expenses for hair treatment and childcare.

Deliberating for just an hour, the jury found against her by a margin of 11-1.  That’s about as quick and complete a rejection as you see in a jury trial case.

The lawyer representing the dissatisfied salon patron, Leta Gorman, is a shareholder at Bullivant Houser, a large west-coast law firm.  She  typically defends manufacturers in injury cases.  According to the news account, the lawyer defending the salon argued that this was a “frivolous lawsuit.”

Oddball cases get twisted, and I imagine this one will show up in the echo chamber of distortion. What the Chamber of Commerce and others who decry lawsuit abuse miss is this: most damage lawsuits are filed by businesses. Here, an affluent and sophisticated consumer seeking beauty in a bottle sued when things went bad. It’s fine for the Chamber of Commerce to complain, but it ought to be truthful about how only the wealthy can afford the luxury of litigation of thin cases.

For those of us who represent injured people, this is one of those eye rollers. It’s an eye roller because cases for people with profound injuries have to wait in line behind luxury litigators. It’s an eye roller because our judicial system–which is strained and underfunded–has to deal with this type of claim. And it’s an eye roller because it gives squawk box material to those who can’t discern between claims for those wrongfully injured and those who litigate simply because they can afford to do so.

For all the heat and the noise, the true story is about quiet wisdom. That wisdom came from the jury. One of the jurors, Del Shaw, was quoted in The Oregonian. His simple assessment is the real story: “We took a look at the facts and didn’t feel the facts supported the claim.” That left me smiling because it simply shows that the jury considered the evidence and made a decision based upon the merits.

In that way, the case proves what those of us who work in the trenches know. Juries generally get it right.

David Sugerman

Nice write up online for the Willamette Week here about how liability insurance rates for Oregon physicians fell. The study from the State of Oregon Department of Consumer and Business Services dispels a major political myth.

While it’s hard to remember, Oregon voters rejected a cap on damages in medical malpractice cases several years ago. The initiative, Measure 35, was sold as necessary due to a crisis. Check out the linked power ponit to see how badly proponents of Measure 35 overstated their position.

Oregon voters saw through the rhetoric and chose the wise course. Today’s study simply confirms the wisdom of that choice.

It should be interesting to see whether this objective information stifles the recurring urge by some to put limits on damages. The absence of any crisis makes it pretty difficult to argue for caps on damages.

David Sugerman

The FDA issued a warning today today  that consumers should not take the diet supplement Hydroxycut due to its potential to cause liver damage. Here is a link to the FDA notice.

I’ve been down this road before in the ephedra litigation. One of the things that would shock most consumers is that many over-the-counter diet supplements aren’t tested before release to the public.  The synthetic ephedra products caused a trail of carnage to consumers. Looks like we may be in for another round.

David Sugerman

Fairly comical story here about how the U of Oregon Ducks Ultimate Frisbee team got banned from competition. It seems that the wild things were into naked ultimate, as well as drinking, and speeding. They were playing for the national title, so it’s actually a major loss.

Full disclosure: I was a third-rate ultimate frisbee player back in the Pleistocene era of my school days. Our team, The Ultimate Menace, never threatened to play for a national title. But to our credit, we always kept our pants on.

The Ducks’ co-captain’s attitude–What the heck is wrong with driving fast, drinking and public nudity?–probably didn’t help in presenting the team’s case. Chalk it up to youth and teachable moments, I guess.

The story has generated a lot of laughs in my office and at home over coffee today. It can’t help but make me want to track down some of the people I used to play to share the mirth. There’s a tinge of sweetness to it, as anyone of a certain age can’t help but smile and remember their own youthful indiscretions.  Fortunately, mine weren’t newsworthy.

David Sugerman

From Oregonlive, here’s an update on HB 2726, the bill that would require chain restaurants to disclose calorie and nutrition information to consumers. The bill reportedly passed out of committee. Here’s the interesting thing. It passed out of committee on straight party lines. All the D’s voted in favor, and all R’s voted against.

Next stop, the House floor. I don’t have any idea what the vote count looks like on this one.

I have to go back to my original question on this. How could anyone oppose giving consumers more information so that consumers can make informed food choices? After all, we’re told that people need to take responsibility for their own decisions. I get that. But for every mouth that’s uttered those words, tell me how voting against more information for consumers helps accomplish this?

I’m listening for answers.

David Sugerman

I recently turned down a complex but interesting case that had been handled by a much larger firm. In hearing about the case, I asked the potential client how he had decided to have this firm handle his case. He explained that he felt like he needed a big firm to take on his former employer’s big firm. According to this young man, who was actually fairly sophisticated, a solo or small firm would simply be out-gunned by the large firm resources.

He was wrong, of course, and part of my reason for turning down the case was that the larger firm had made some poor choices in how they pursued the matter.  His perception is not uncommon.  What few but the best-informed consumers realize is that in the law biz, bigger is not necessarily better. And usually it is far more expensive.

Take this example in which Century Indemnity Insurance Co. is reportedly involved in a fee dispute with the large law firm of Latham & Watkins.  According to the linked report, Latham & Watkins billed an associate who had not even passed the bar at the rate of $450 per hour.

The thing about new lawyers is that when they come out of law school, they really don’t know how to practice law. They may be the best and the brightest by virtue of their acadmic achievements. But at most, they’ve simply studied cases, constitutions, and laws. They haven’t learned how to apply the skills.

When you’re paying by the hour this matters. A seasoned attorney can accomplish in a tenth of a time what a new attorney can, and the seasoned attorney will generally turn out better quality work to boot. That difference is supposed to be reflected in hourly rates. In other words, a new attorney’s rate should be much lower than a seasoned attorney’s rate.

Put another way, who in their right mind would pay $450 per hour for work by someone who will take 10 times as long to do the same task and likely won’t do as good a job?

Those who are truly in the know realize that small firms often deliver the best value. A well-trained and experienced practitioner in a small firm often has profound advantages over large-firm colleagues. The small firm practitioner typically has lower overhead and thus doesn’t bill frivolously. We deal directly with our clients and have to work harder to maintain relationships. Small firms tend to be nimble. We don’t answer to committees, and waste clients’ time and money with lengthy memos, team meetings, and the like. Instead, we get the work done.

Part of me is wickedly amused that Century Indemnity paid through the nose. In representing injured people, I have developed a sense of disdain for many large firms and their inflated billing practices. But of course, that’s between the firm and its client, and none of my business. Should be interesting to see whether this dispute shines a light on inflated hourly rates and overpaying for legal help.

David Sugerman