The frivolous lawsuit canard often turns on whose ox is getting gored. When a consumer files a class action, it is–according to representatives of business interests–a frivolous lawsuit. But when someone who wants to close the courthouse doors files their own class action, it is to take on illegal conduct.

When a politician who is opposed to frivolous lawsuits or too many lawsuits threatens to file her own case, that, too, is a different story.

The latest chapter comes from this stinging rebuke of the so-called Birther movement. It seems that one Captain Connie Rhodes sought an injunction prohibiting her deployment to Iraq because President Obama has not established that he was born in the U.S. As a result–the lawsuit claims–he is not the Commander-in-Chief. And so, she claims, she should not be required to ship out to Iraq because President Obama isn’t the real president.

The opinion makes entertaining reading. The court takes a dim view of Capt. Rhodes’ lawyer’s antics in this and other cases. Correctly so, I might add. Still, I’m going to wager that the court was a bit too restrained for the message to get through. Maybe next time.

I can hardly wait to see this opinion crop up on Freedomworks web site. They claim to be concerned with frivolous lawsuits. Any takers on whether they list it?

David Sugerman

Unless you enjoy reading court cases, no sense in looking at this new Oregon Court of Appeals opinion. It’s an interesting case, even if it’s a bit long. In it, the Court took two lawyers to task over their conduct.

In the underlying case, Tahvili v. Washington Mutual, the Court affirmed a trial court’s ruling barring a California lawyer–one Burton McCullough–for his conduct at trial. Mr. McCullough was specially admitted to practice in Oregon for a trial. According to the Court of Appeals opinion, Mr. McCullough vioalted a trial court order, repeatedly violated trial court rulings and kept trying to get inadmissible evidence before the jury. In the middle of the trial, the trial judge got so angry with Mr. McCullough’s repeated violations that he revoked Mr. McCullough’s permission to specially appear.

The trial judge, Sid Galton, has since retired. Mr. McCullough’s conduct reads like a point-by-point primer on how not to try cases. Or at least how not to try cases in Oregon.

The Court of Appeals took a dim view of Mr. McCullough’s conduct. But it seemed more annoyed by the brief submitted in the Court of Appeals. In their brief, Mr. McCullough and the Portland firm of Greene & Markley argued that the trial judge–Judge Galton–suffered from mental health problems and had anger issues. The appeal brief even denied that Judge Galton had entered an order and kept referring to a “phantom order.” While the Court of Appeals spared details of more wreckage but made clear that the arugment  went further with hyperbole and distortion.

Writing for the unanimous court, Judge Haselton had this to say:

“We pause to express our collective disapproval of such methods of appellate “advocacy.”  We have repeatedly, in both published opinions and public professional fora, condemned ad hominem attacks on trial judges as offensive and improper.  Such “scorched-earth” tactics, when coupled–as they almost invariably are–with lurid and misleadingly incomplete descriptions of the record–are counterproductive.  They impair, rather than assist, the appellate process” (quotations and italics in the original).

In the rarified air of the Oregon Court of Appeals, that’s equivalent to a serious smack down.  Courts are like elephants in that they don’t forget.  Oregon remains a small legal community, and as a result, most of us who practice law here are mindful of how we conduct ourselves. In Oregon legal circles, earning a reputation for being unprofessional or dishonest sticks with a lawyer for a long time.

The other thing of note is that the Court of Appeals correctly protected the integrity of the trial judge. One of the things that’s really important for our system is judicial integrity. We can’t have a fair legal system if judges aren’t accorded respect by lawyers appearing in court. We can disagree with judges. We can dislike their reasoning and take issue with their conclusions, but if we’re to be part of the justice system, each of us owes a duty to maintain the integrity of the system.

David Sugerman

I would be remiss if I didn’t note this New York Times report on prison sentences for former insiders at Milberg Weiss for their roles in the former high-flying class action law firm’s kickback scheme. Interestingly, both former partners, Steven Schulman and David Bershad, reportedly cooperated with federal investigators to provide critical detail on the law firm’s misconduct.

There’s a certain level of sad irony in this. I won’t defend Milberg Weiss. They did wrong, and the take down is the right result. But the sad thing is that their securities work was one of the few thin forms of protection when Wall Street engaged in misconduct.  So I’m hoping that these take downs are just a prelude for the next round. Because I have to imagine that there are some people at AIG, at Bear Stearns, at some of the investment firms and credit rating agencies who did similar or worse.

David Sugerman

Sad piece here in today’s Oregonian about Portland trial lawyer Mike Shinn, who faces possible disbarment for taking clients’ money. Seems like this is just a take-it-in-the-shorts week for trial lawyers, as former trial lawyer John Edwards seems to be digging himself an awfully deep hole.

In the Shinn matter, the Oregon State Bar is reportedly pressing ahead with disciplinary proceedings, as it should. The Bar may also ask for an emergency suspension of Shinn’s license to practice.

Simple rule that every Oregon lawyer knows:  If you take a client’s money, you lose your license. It’s got to remain an absolute rule.  Clients need to trust that their lawyers are dealing fairly and honestly with them.

It’s sometimes easy for client-lawyer relations to go bad. You’re never starting in a happy and good place if you need a lawyer.  And that’s when the client first walks in the door.  Some lawyers do a particularly bad job of communicating with clients, and this can add to problems.  But none of those things ever justifies a lawyer taking an undeserved dime from a client. And if that’s what happened, Mr. Shinn should lose his license.

I’ve known Mike Shinn casually for a long time. He’s done some great work over the years. My hope is that this is all a misunderstanding and that he didn’t cross any lines. Regardless of my hope, the Bar needs to get to the bottom of it.  As for the former clients who are pressing their claims, we owe them both apologies and gratitude. It’s a thankless position. If there’s a lawyer out there acting corruptly, the willingness to challenge is the best way to protect the public.

Kudos, too, to Judge Tennyson who had the unenviable job of blowing the whistle. You don’t get a lot of love letters when you turn someone in. But it’s the right thing to do.

I’ve been ruminating all day on this story, along with my continuing annoyance over the Edwards matter. Maybe they’re totally unrelated. During my noon-hour work out, I had a flashback to my teen years. At the height of the Watergate scandal, I was sitting outside under tall shade trees with my apolitical grandfather. Harry was the kind of guy who wanted nothing more than to run his business, sip his whiskey and have a good time. He viewed all politicians with suspicion when he thought about them at all.

I was riveted by the Watergate hearings, and I asked Harry what he thought about the whole thing.

He took a long draw off his scotch, “They were schmucks,” he said.

“What do you mean?” I countered. I think I was thrilled that he would share some wisdom with me, his raging adolescent grandson.

“They were schmucks for doing it, ” he said. And then a quarter beat later he added, ” And they were bigger schmucks for getting caught.”

Maybe Harry’s take fits better on Edwards. As for lawyers who take clients’ money, well they’re schmucks from the get go.

David Sugerman

No secret that I’ve been a big critic of large insurance companies. You don’t have to look too far into the archives to find a combination of snarkiness, outrage, and jaundice over some of their practices. So this one is in the spirit of calling it fairly. While away on vacation, I missed this report on the outcome of high-flying plaintiffs’ lawyer Dickie Scruggs’ fall from grace.

Back story is that Scruggs is one of the guys who took on the tobacco industry made millions, took on the insurers on Katrina claims, and was poised to make millions more. In between he’s done all manner of injury cases. I have no basis to know the specifics, but I would be willing to bet that he’s earned sums that might shame some small countries’ gross domestic profit numbers. So he falls from grace when the state and maybe a few insurance carriers go after him for attempting to bribe a judge.  They got him, and now he’s going to jail.

Let’s be clear. Allstate, State Farm, The Wall Street Journal and everyone else has a right to call this guy a crook and to be wary of conduct like this. I join them, by the way. I particularly appreciate what Mr. Scruggs has done for injured people with legitimate claims and their lawyers who play by the rules. (Editors note: He’s being snarky, again…he’s not grateful. Not one bit.)

It’s a black mark on those who represent injured people. It’s worse than the magic pants guy, as this was an attempt to completely undermine the fairness of the civil justice system. The problem is that criminals and clowns like this provide major fuel for the efforts of those who would limit consumers’ ability to access the courts.

It was reported that Mr. Scruggs swooned when the judge sentenced him to the maximum. Good. And I hope the jerk spends each hour of his five years reflecting on how his corruption undermined the civil justice system. I say big props and major thanks to the trial judge. By slamming him, the judge made it clear that the integrity of the civil justice system will not be undermined by criminals.

David Sugerman

The story is coming out that Melvin Weiss, former class action securities lawyer, was sentenced to 30 months and fined $10 million under a plea deal with the U.S. Department of Justice. The Milberg Weiss law firm has been a national presence for years, handling some of the largest securities class actions in U.S. history.

I would be a hypocrite if I failed to write about this and say the obvious. As I’ve noted before, getting rid of the cheaters is critical to a healthy civil justice system. That’s true regardless of which side the cheater operates from. Melvin Weiss did a grave disservice to consumers and investors. I have my doubts that 30 months + $10 million is sufficient, if you think about the harm inflicted. Even so, it’s done.

I imagine that there will be quite the feeeding frenzy on the corruption at the Milberg Weiss firm in the blogosphere,  at the Chamber of Commerce, from the tort reform advocates, and over at FOX news. But let’s remember that the corruption that nurtured Milberg Weiss operated heavily on the investment firms, as well. If that’s not readily apparent, here’s a quick list for the consideration: Bear Stearns, mortgage lending, Enron.

All of that is beside the point. As one who handles class actions, I’m strongly in favor of getting rid of the corrupt. Good news in the end.

David Sugerman

It sounds like a set up in search of a punch line: What’s the difference between an Oregon lawyer and a Texas lawyer? If you’re an Oregon consumer, you can have a laugh, and if you live in Texas, well, shed another tear.

Oregon requires that each Oregon lawyer carry liability insurance, as a way to protect consumers in case the Oregon lawyer mishandles the client’s matter.  The Professional Liability Fund provides the first level of insurance to all Oregon lawyers. And that’s part of the secret to its success. There’s a lot of purchasing power when you have a large group buying insurance. As a result, the annual premiums are affordable.

Texas takes a different approach. A commission set up by the Texas Supreme Court recently rejected a rule that would require all Texas lawyers to inform clients about whether they have liability insurance.  The proposed rule was fairly straightforward. It simply required all Texas lawyers to disclose whether they had malpractice insurance. The commission rejected the rule. I guess it’s there own special version of, “Don’t ask; don’t tell.”

According to the news report, the commission rejected the rule because…gasp!…it could lead to mandatory insurance.  Oregon lawyers and consumers have got to be ridiculing Texas over this one. Lord knows that mandatory liability insurance could lead to actual protection of the public interest.

This one is a no brainer.  As an ex-Texan, I can say with the certainty of one who was born and raised there, no one ever accused the mighty Lonestar State of being long on brains. (And of course, I feel compelled to explain that it was a long time ago, I had no say in the matter, and…and…and….)

Having insurance is actually one of those comforts for both me and my clients. I’ve handled multiple lawyer malpractice cases over the years, and I’ve learned that lawyers sometimes make mistakes that can do great damage to our clients.

So why would anyone go without?  The Texas commission really missed the boat on this one.  Mandatory insurance has protects the public in Oregon.  And even if Texas won’t insist on insurance, the Texas commission chose to sow more seeds of distrust by blowing past the chance to provide Texas consumers with a small bit of protection. Bad call.

David Sugerman

There are generally sharp divisions between those of us who work in the civil justice system. Most lawyers who do this kind of work represent one side, more or less exclusively. After all, Allstate, the lead paint manufacturers, and CNA–the physician insurance company–don’t want to hire lawyers who routinely pursue claims against their interests.

But the latest round of criminal convictions against some big name plaintiffs lawyers are leading me to re-think some of this. Dickie Scruggs has been in the news of late. He’s handled lots of big-time cases, including tobacco cases and–most recently–post-Katrina insurance claim cases. He recently pleaded guilty to attempting to bribe a judge.  Sorry, but we just downloaded a new version of wordpress, and I’m having problems with the link function. However, there’s a nice news report at www.natchezdemocrat.com..  Article date is March 14, 2008.

For those of us who play by the rules, the revelations of misconduct raise a combination of responses. Immediately, there’s a sense of outrage that these people not only violated the trust placed in us but also let their greed pollute a system that is so important to a functioning democracy. If we can’t trust the integrity of the civil justice system, I’m truly worried about our collective future.

I suppose for those of us who never aspired to be the world’s greatest or richest trial lawyers, there is also some sense of smug self-satisfaction in watching those who overreach fall. That’s wrong, of course, but I would be less than honest if I didn’t cop to the reaction.

The good news for Oregon consumers and businesses is that our state civil justice seems to operate cleanly. We’re small enough that all the players know each other, and I think that all sides of Oregon’s civil justice bar remain committed to clean justice.

Scruggs and the bad guys at Milberg Weiss are bad news. They’ve done significant damage, I fear. But don’t lose sight that greed and misconduct run on both sides. If you have any doubt about this, go back and learn about the greed-driven misconduct of a number of a large corporations like some of the oil companies, the asbestos manufacturers, tobacco, or some of our casualty insurers.

When I started out in this profession, I committed myself to working on the side of people. I naively viewed the civil justice system through a narrow prism that put all who represented people on the side of good. And I suppose I still cling to the notion that if you’re willing to take the hard road and stand up for middle- and low-income people against big institutions, you’re doing good on this planet. That commitment hasn’t waned. But I now realize that I feel a tighter affinity with those who are committed to a clean system, regardless of which side they represent.

David Sugerman