Showing papers on "Class action published in 1997"
TL;DR: The Fraser Institute has brought together an interesting volume that seems to bear the message of Adam Egoyan's movie The Sweet Hereafter; namely, that lawyers as ambulance-chasers are bad news.
Abstract: These fine books on aspects of law and criminality support the platitude that crime does not pay -- except for lawyers, criminologists and insurance companies. Canadian criminals put in more time in jail per dollar stolen in other countries, although these statistics predate the conviction of Alan Eagleson. Another statistic, even less likely to stir patriotic pride, is that Canadian youth, as Bernard Schissel points out, have the highest per capita rate of incarceration of any country in the world.If crime rates in Canada have dropped off in recent years, corresponding to the diminishing ratio of youth in the Canadian population, we still have a lot more lawyers. Prior to the Charter of Rights and Freedoms, Canadians had less than half as many lawyers per capita as the Americans but now we approach two-thirds of the American ratio (Law and Markets 77-81) creating "the danger of supply-driven and socially harmful increases in litigation" (85). Virtually, all of the contributors to Law and Markets bemoan Canada's increasing litigiousness; none defend the very quality that brought one of Canada's most honoured citizens to jail. The Fraser Institute has brought together an interesting volume that seems to bear the message of Adam Egoyan's movie The Sweet Hereafter; namely, that lawyers as ambulance-chasers are bad news. Law and Markets is concerned not with corporate criminality but with the prospect that enterprising lawyers, instigating class action suits on contingency fees, will be able to dupe civil juries, and cut into profit margins. Indeed, Richard Hazelton, the CEO of Dow Corning which filed for bankruptcy because of the silicone breast implant suit, tells a cautionary tale for Canadian businesspeople.Contributors point out that jurors lack competence to assess the scientific and technical evidence about toxic emissions, risks to health, the relationship of causality and legal accountability; prejudices about dioxin spills may skew assessment of the personal injury caused by the spillage. The one exception to the anti-litigation view of the 17 contributors to Law and Markets is Mark Mattson, an environmental litigator, who argues convincingly that the Canadian Environmental Protection Act needs radical revision or abolition. Mattson argues that the federal government should either enforce environmental standards or leave private litigators like himself to engage in civil ligation against environmental polluters. Mattson recommends that public interest groups and their lawyers split the fine levied on the offending corporations or municipalities (135). While Mattson may conform to the Fraser Institute's policy on deregulation -- "It is government intervention that stands in the way of a public right to protect community resources" (136) -- his proposals would encourage litigation, diminish shareholder profits and raise citizens' taxes. If the aim of Canadian economic regulation is, as Konrad von Finckenstein puts it, "user-friendly regulation," we are led to conclude that deregulation and user-friendly regulation are not the same thing. If the conflicting interests of Richard Hazelton and Mark Mattson reveal the current contradictions of capitalism, we might also note that the provinces geographically and ideologically closest to the Fraser Institute (British Columbia and Alberta) are the most litigious, while New Brunswick are Newfoundland are least litigious (158-9).An exciting challenge for the Fraser Institute would be to take on the human rights legislation that emerged after the Second World War, arising from a combination of anti-Nazi principle, Keynesian welfarism and acceptance of wartime control of goods and services in the public interest. Since human rights codes abridge several common law rights, of property and contract, specifically the right of business to discriminate in favour of preferred employees, buyers, tenants and customers, the Institute's views on James Walker's compelling account of the role of human rights legislation in limiting racism in the Canadian marketplace would be illuminating. …
92 citations
Posted Content•
TL;DR: In this paper, a preliminary analysis of the effects of the Private Securities Litigation Reform Act of 1995 on class action securities fraud litigation behavior is presented, showing that the reform act appears to have little effect on the aggregate number of companies sued, but has induced a substitution effect into state court where plaintiff's argue that many of the Act's provisions do not apply.
Abstract: This paper presents a preliminary analysis of the effects of the Private Securities Litigation Reform Act of 1995 on class action securities fraud litigation behavior. The Reform Act appears to have had little effect on the aggregate number of companies sued, but has induced a substitution effect into state court where plaintiff's argue that many of the Act's provisions do not apply. Complaints now allege accounting irregularities and trading by insiders with greater frequency than before, while pure false forecasting cases are now relatively rare. The average stock price decline preceding litigation is now 31%, whereas prior to the Reform Act it was 19%. The Act's "strong inference" pleading requirement is the most likely cause of these shifts. High technology firms continue to be the most frequent targets of litigation, and the appearance ratio of the largest plaintiffs' firm, Milberg Weiss, has increased significantly nationwide and particularly in California. These findings are all consistent with a model that views class action securities fraud litigation as an economic process involving rational profit maximizing agents. The data are, however, too preliminary to support strong conclusions regarding the "success" or "failure" of Reform Act innovations.
58 citations
TL;DR: In this article, the authors examine the stock price performance of firms in four industries (biotechnology, computers, electronics, and retailing) that are likely to be affected by securities litigation reform and find that the positive factors outweigh any increased susceptibility to managerial fraud or inability to bring meritorious suits.
Abstract: In December 1995, Congress overrode a presidential veto to enact the Private Securities Litigation Reform Act. This legislation was aimed at curbing abuses in class action securities litigation, and providing firms with relief from frivolous lawsuits brought on the basis of stock price volatility. While the intent of lawmakers in drafting this legislation was clear, the impact of the Reform Act for shareholders of firms that are likely targets of securities litigation was uncertain. In particular, it was unclear if the cost savings from reduced litigation would outweigh the potential losses due to decreased protection from fraudulent managers, and it was also unclear if the impact of the legislation would differ for firms with different governance structures. This paper provides an economic answer to these questions by analyzing the stock market's response to the initial passage, the veto, and subsequent veto override of the Reform Act. We examine the stock price performance of firms in four industries—biotechnology, computers, electronics, and retailing—that are likely to be affected by securities litigation reform. We document a significantly negative stock price response to rumors of the presidential veto and a significantly positive response to the subsequent House override vote, indicating that investors agreed with Congress that the positive effects of the Act predominate. We also examine reactions across subsets of firms with different levels of institutional ownership, different levels of insider ownership and with different board structures, and find evidence that the positive factors outweigh any increased susceptibility to managerial fraud or inability to bring meritorious suits, even among firms with weak internal governance structures. © 1997 John Wiley & Sons, Ltd.
57 citations
TL;DR: The authors examined volatility and market sensitivity for both sued and nonsued firms and found that sued firms exhibit higher systematic risk than the population of non-sued firms, and that settlement values are significantly positively related to the seriousness of allegations in the suit, the length of time during which the shareholders allege they were misled, and the overly optimistic tone of announcements about the firm during this misleading information period.
Abstract: Under SEC Rule 10b-5, shareholders can sue a corporation that they believe has materially misled them about the firm's prospects. Recent legislation calls for reform of the rules governing shareholder class action litigation. Writers for the business press and experts testifying before the US Congress have argued that such litigation is largely frivolous in that attorneys target firms with highly volatile stock return histories, and litigated price drops are caused by return sensitivity to contemporaneous market movements. Further, they argue that the legal structure surrounding shareholder litigation produces excessive settlements based on the target firms' fear of large jury verdicts.
This paper examines volatility and market sensitivity for both sued and nonsued firms. The approach is different from that of earlier papers in several ways. First, rather than selecting an arbitrary period prior to the lawsuit filing date, we examine both the financial performance and news-release characteristics of sued firms during the alleged misleading information period (MIP) of the suit: that is, during the period in which investors allege the firm misled the market. Second, we divide the lawsuit sample into categories depending on the allegations in the suit and the proximity of the MIP to the disclosure that caused the suit. Third, sued and nonsued firm samples are larger than those in earlier papers; for example, our sued firm sample includes 491 observations. Comparison group samples have also been broadened to include industry, size, past behavior of sued firms, and firms acquitted of the charges.
We find that sued firms are more likely to experience episodes of very poor price performance than the population of nonsued firms. Sued firms exhibit higher systematic risk than the population of nonsued firms. Prior to the alleged misleading information period, sued firms experience abnormal positive returns for about 3 years. However, during the misleading information period, sued firms experience significant negative abnormal return. Sued firms issue more positive news in the MIP than matched groups of nonsued firms. Finally, we find that settlement values are significantly positively related to the seriousness of allegations in the suit, the length of time during which the shareholders allege they were misled, and to the overly optimistic tone of announcements about the firm during this misleading information period. © 1997 John Wiley & Sons, Ltd.
40 citations
Posted Content•
TL;DR: In this paper, the authors examine the irrelevance of most of the data considered by the Congress during its hearings in 1993 and 1994 focused on securities fraud class actions and conclude that the protector of the class action's virtue lies with the superintending powers of the judiciary.
Abstract: In Part I of the essay (borrowing from Mark Twain, entitled "Lies, Damn Lies and Statistics") we examine the irrelevance of most of the data considered by the Congress during its hearings in 1993 and 1994 focused on securities fraud class actions. Part II responds to several commentators who argue against an entity-based sanction for market fraud; we argue that entity liability should be seen as a power disciplining force and not merely shifting money from one set of pockets to another. The final portion of the paper critques the Private Securities Litigation Reform Act. We conclude that the protector of the the class action's virtue lies with the superintending powers of the judiciary.
40 citations
TL;DR: In this article, the authors argue that the various problems attending mass tort class actions can only be effectively addressed if courts are given power to substantively review the underlying merits of a claim prior to class certification.
Abstract: Class certification in a mass tort case confers extraordinary negotiating power even where the underlying claim is meritless. This power stems from the prospect that claims of a large‐numbered class might reach a jury that might render a large aggregate judgment under our vastly looser tort law standards. The power is so extreme that all mass tort claims certified as classes appear to settle, rather than litigate to judgment. Recommendations for class action reform have been solely procedural since Rule 23 has been implemented without substantive review of the underlying claim. This article shows that recent reform efforts in fact attempt to impose substantive controls on mass tort class actions through procedural means, efforts that necessarily will remain inadequate. The various problems attending mass tort class actions can only be effectively addressed if courts are given power to substantively review the underlying merits of a claim prior to class certification.
20 citations
Journal Article•
TL;DR: In this paper, the authors examine the irrelevance of most of the data considered by the Congress during its hearings in 1993 and 1994 focused on securities fraud class actions and conclude that the protector of the class action's virtue lies with the superintending powers of the judiciary.
Abstract: In Part I of the essay (borrowing from Mark Twain, entitled "Lies, Damn Lies and Statistics") we examine the irrelevance of most of the data considered by the Congress during its hearings in 1993 and 1994 focused on securities fraud class actions. Part II responds to several commentators who argue against an entity-based sanction for market fraud; we argue that entity liability should be seen as a power disciplining force and not merely shifting money from one set of pockets to another. The final portion of the paper critques the Private Securities Litigation Reform Act. We conclude that the protector of the the class action's virtue lies with the superintending powers of the judiciary.
16 citations
TL;DR: There has been an upsurge of interest in class action litigation over the past few years, and legal scholars, journalists, and politicians have all weighed in on the topic as mentioned in this paper.
Abstract: There has been an upsurge of interest in class action litigation over the past few years. Legal scholars, journalists, and politicians have all weighed in on the topic. Congress reformed federal securities class action procedures in 1995, and an advisory committee is weighing a proposal for fundamental changes to Rule 23, the general federal class action provision. The Supreme Court of the United States issued important decisions on class action settlements during the past few years, and more are likely to follow.
15 citations
TL;DR: In this article, the authors use the model of qui tam litigation as a tool to understand class action litigation and propose a hybrid litigation form that combines the attributes of the public and private models.
Abstract: This article uses the model of qui tam litigation as a tool to understand class action litigation. Starting with an examination of current class action practice, the article demonstrates how class actions have moved away from the format of traditional individual litigation. Departures from traditional procedural rules have been justified as deterring corporate misconduct, yet these departures are frequently criticized as reducing victim compensation and creating agency problems. The article goes on to consider proposals for class action reform. Existing reform proposals tend to take one of two forms: either they propose remodeling class litigation so that it more closely resembles traditional litigation, or they propose more dramatic departures from traditional procedural rules in order to enhance the deterrence effect of the class suit. The latter reforms, based on the private attorney general model, move class litigation closer to government enforcement litigation. A significant reason for the conflict between these approaches stems from disagreement about whether class actions should focus on victim compensation or deterrence of misconduct. The article argues that, before either approach to class action reform is adopted, class litigation should be understood as offering a third possibility: a hybrid litigation form that combines the attributes of the public and private models. Using the model of qui tam suits, the article attempts to break down the conceptual barrier between public and private litigation. Finally the article examines the implications of this approach. The article suggests that reconceptualizing class litigation as a hybrid offers the potential for coordinating the litigation efforts of the government and the private bar. In addition to creating potential litigation efficiencies, this model allows class litigation effectively to pursue both compensation and deterrence.
12 citations
1 May 1997
TL;DR: In this article, a review of class-action civil rights litigation for in stitutionalized adults with mental retardation and related devel opmental disabilities is presented, focusing on cases related to the right to live in the least restrictive environment, reasonable care and safety, freedom from bodily restraint; ad equate food, shelter, clothing, and medical care.
Abstract: This article reviews class-action civil rights litigation for in stitutionalized adults with mental retardation and related devel opmental disabilities. Specifically, the article focuses on cases related to the right to live in the least restrictive environment, reasonable care and safety, freedom from bodily restraint; ad equate food, shelter, clothing, and medical care; and adequate training and habilitation to ensure safety and freedom from bodily restraint as determined by professional opinion. The review is divided into two major sections. The first section provides infor mation, such as the number and type of cases; type of plaintiffs; type of legal counsel; the role of other parties; the role of the U.S. Department of Justice (DOJ); and the number of institu tional closures as a result of litigation. The second section pro vides summaries of the decisions, which address the allegations, the outcomes, and the current status of the cases.
11 citations
Book•
[...]
1 Oct 1997
TL;DR: These fine books on aspects of law and criminality support the platitude that crime does not pay -except for lawyers, criminologists and insurance companies as discussed by the authors, and none defend the very quality that brought one of Canada's most honoured citizens to jail.
Abstract: These fine books on aspects of law and criminality support the platitude that crime does not pay -- except for lawyers, criminologists and insurance companies Canadian criminals put in more time in jail per dollar stolen in other countries, although these statistics predate the conviction of Alan Eagleson Another statistic, even less likely to stir patriotic pride, is that Canadian youth, as Bernard Schissel points out, have the highest per capita rate of incarceration of any country in the worldIf crime rates in Canada have dropped off in recent years, corresponding to the diminishing ratio of youth in the Canadian population, we still have a lot more lawyers Prior to the Charter of Rights and Freedoms, Canadians had less than half as many lawyers per capita as the Americans but now we approach two-thirds of the American ratio (Law and Markets 77-81) creating "the danger of supply-driven and socially harmful increases in litigation" (85) Virtually, all of the contributors to Law and Markets bemoan Canada's increasing litigiousness; none defend the very quality that brought one of Canada's most honoured citizens to jail The Fraser Institute has brought together an interesting volume that seems to bear the message of Adam Egoyan's movie The Sweet Hereafter; namely, that lawyers as ambulance-chasers are bad news Law and Markets is concerned not with corporate criminality but with the prospect that enterprising lawyers, instigating class action suits on contingency fees, will be able to dupe civil juries, and cut into profit margins Indeed, Richard Hazelton, the CEO of Dow Corning which filed for bankruptcy because of the silicone breast implant suit, tells a cautionary tale for Canadian businesspeopleContributors point out that jurors lack competence to assess the scientific and technical evidence about toxic emissions, risks to health, the relationship of causality and legal accountability; prejudices about dioxin spills may skew assessment of the personal injury caused by the spillage The one exception to the anti-litigation view of the 17 contributors to Law and Markets is Mark Mattson, an environmental litigator, who argues convincingly that the Canadian Environmental Protection Act needs radical revision or abolition Mattson argues that the federal government should either enforce environmental standards or leave private litigators like himself to engage in civil ligation against environmental polluters Mattson recommends that public interest groups and their lawyers split the fine levied on the offending corporations or municipalities (135) While Mattson may conform to the Fraser Institute's policy on deregulation -- "It is government intervention that stands in the way of a public right to protect community resources" (136) -- his proposals would encourage litigation, diminish shareholder profits and raise citizens' taxes If the aim of Canadian economic regulation is, as Konrad von Finckenstein puts it, "user-friendly regulation," we are led to conclude that deregulation and user-friendly regulation are not the same thing If the conflicting interests of Richard Hazelton and Mark Mattson reveal the current contradictions of capitalism, we might also note that the provinces geographically and ideologically closest to the Fraser Institute (British Columbia and Alberta) are the most litigious, while New Brunswick are Newfoundland are least litigious (158-9)An exciting challenge for the Fraser Institute would be to take on the human rights legislation that emerged after the Second World War, arising from a combination of anti-Nazi principle, Keynesian welfarism and acceptance of wartime control of goods and services in the public interest Since human rights codes abridge several common law rights, of property and contract, specifically the right of business to discriminate in favour of preferred employees, buyers, tenants and customers, the Institute's views on James Walker's compelling account of the role of human rights legislation in limiting racism in the Canadian marketplace would be illuminating …
Posted Content•
TL;DR: The current discussion of the settlement class assumes the device to be quite novel from a narrow point of view as discussed by the authors, and assumes that the class action resembles the defendant class actions common in medieval and early modern periods.
Abstract: The current discussion of the settlement class assumes the device to be quite novel. That assumption of novelty is accurate only from a narrow point of view. From a slightly broader perspective, however, the settlement class resembles the defendant class actions common in medieval and early modern periods. During those periods, group litigation did not function as a device that systematically empowered plaintiffs. Only in the last few decades has the class action operated in this party-asymmetrical way. The settlement class changes that dynamic; this change, as much as anything else, explains that furor that has accompanied the settlement class. In effect defendants are turning the class action against plaintiff. From the standpoint of procedural theory, such a turn is not itself illegitimate. If one could free the settlement class from the justified concerns about lawyer-client conflict, it might serve adjudicatory efficiency and clarify procedural thought.
TL;DR: In US courts, the procedural device of the class action is available by virtue of Rule 23 of the Federal Rules of Civil Procedure as mentioned in this paper, subject to certain conditions, this rule enables one person to bring an action on behalf of a large number of others (the "class members") and the resolution of such an action, whether it is by way of judgment following trial or by the entry of an order of settlement, has res judicata effect on the class members.
Abstract: In US courts the procedural device of the class action is available by virtue of Rule 23 of the Federal Rules of Civil Procedure. Subject to certain conditions, this rule enables one person to bring an action on behalf of a large number of others (the “class members”) and the resolution of such an action, whether it is by way of judgment following trial or by the entry of an order of settlement, has res judicata effect on the class members. In most cases the majority of class members are all resident in the United States.
Journal Article•
TL;DR: In this article, the authors present an analytical framework for the optimal fee cap and its effect on settlement behavior in the context of a simple model of the negotiation process and the settlement terms.
Abstract: TABLE OF CONTENTS Introduction .................................... 1430 I. The Fee Regulation Problem .................... 1436 A. The Potential for Collusion .................. 1486 B. The Role of Fee Regulation .................. 1438 1. Basis for a fee cap ...................... 1438 2. Effects of a fee cap ...................... 1439 3. Structure of the optimal fee cap ............ 1439 4. Identifying the optimal fee cap ............. 1440 5. Subclasses and the problem of distribution .... 1440 II. Analytical Framework ......................... 1441 A. A Simple Model .......................... 1441 1. Negotiation process ..................... 1442 2. Settlement terms ....................... 1442 3. Disposition of case ...................... 1444 B. The Court's Objectives ..................... 1445 C. Constraints ............................... 1445 III. The Basis for Fee Regulation..................... 1447 A. Equilibrium Settlements .................... 1448 B. Justification for Regulating the Fee ............ 1450 IV. Effects of Fee Regulation ....................... 1451 A. Capping Counsel's Fee ..................... 1451 B. The Fee Cap's Effects on Settlement Behavior .... 1453 C. Ex Ante Versus Ex Post Effects of the Fee Cap ..... 1455 V. The Optimal Fee Cap ......................... 1456 A. Basic Structure of the Optimal Fee Cap ......... 1457 B. Properties of the Optimal Fee Cap ............ 1459
TL;DR: In the private sector, however, there have been too many instances where inappropriate and excessive settlements have brought about negative reactions from the citizens and Congress as mentioned in this paper, which has further curtailed efforts to reign in corporate crime.
Abstract: In considering the subject of deterring corporate misconduct, several facts need to be put on the table. First, the government does not have either the resources or, in certain instances, the inclination to fight corporate crime. Some observers say the executive and legislative branches may well have been coopted by a public relations campaign aimed at curtailing lawsuits. This observation has been fueled by jury verdicts that seem disproportionate to the injuries sustained. Witness, for example, the large award against McDonald's for serving a cup of coffee that was too hot.1 Essentially, that leaves the private sector to fend for itself. In the private sector, however, there have been too many instances where inappropriate and excessive settlements have brought about negative reactions from the citizens and Congress. This has further curtailed efforts to reign in corporate crime. Questionable class action lawsuits have been brought in the private sector and the public relations firms of those sued have obtained tremendous mileage on behalf of their corporate clients in bringing about opprobrium to class action lawsuits.
TL;DR: The Milberg, Weiss firm as mentioned in this paper has become an ever more commanding presence on the scene of securities class action litigation, and the reason for the firm's rise is very simple: one consequence of the Act has been the lengthening of proceedings.
Abstract: There is something called the “Law of Unintended Consequences.” Who enacted this law, who enforces it, and its exact scope are obscure. However, from time to time it manifests itself, most recently having made an appearance in some of the fallout from the Private Securities Litigation Reform Act of 1995 (“the Act”). One unintended or, perhaps more accurately, unforeseen consequence of the Act has been the increasing appearance of the Milberg, Weiss firm as plaintiffs’ counsel in securities class action litigation. This firm, seen by many advocates of reform as the incarnation of all they dislike in class litigation, has become an ever more commanding presence on that scene. Milberg, Weiss has extraordinarily competent and experienced lawyers in class action litigation who have been extremely successful in securing substantial verdicts and procuring huge settlements. Their increased ascendancy and heightened visibility in the class action arena cannot be a source of joy to the promoters of the Act. The reason for the firm’s rise is very simple: One consequence of the Act has been the lengthening of proceedings. Milberg, Weiss, with its deep pockets and vast experience, is better able than most other smaller plaintiffs’ firms to sustain this lengthy process without suffering crippling financial strain. Another unintended consequence of the Act was the initial migration of securities litigation to the state courts. Most states do not have laws that impose the stringent pleading requirements of the Act, set the hurdles so high in prevailing on fraudulent forecasts, provide for separate and proportionate damages, or place other impediments in the path of success in class actions like those created by the Act. While there initially appeared to be a major move toward state courts, this trend subsequently abated, and at the present writing the pendulum has swung back toward the federal system, both as a proportion of total litigation and in absolute numbers. Not surprisingly, most of the state litigation was initiated in California, largely as a consequence of the fact that
TL;DR: In this paper, the authors discuss the benefits and costs of class action procedures and how the legislature and the public will view the costs and benefits of such procedures, and evaluate them realistically and usefully only by considering their probable effect within a social and legal system.
Abstract: Professor Per Henrik Lindblom's discussion of proposals regarding group actions in Sweden seems sound to a person steeped in the United States experience.' I assume general agreement with the proposition that civil procedure should be designed to vindicate the substantive rights of each person in the jurisdiction by, to quote Rule 1 of the Federal Rules of Civil Procedure, "the just, speedy, and inexpensive determination of every action." It is axiomatic that procedural and substantive issues in the class action context cannot be divorced. Nor can considerations of politics and public policy be left out of the equation. We can evaluate class action procedures realistically and usefully only by considering their probable effect within a social and legal system that includes regulation, health and other forms of insurance, government benefits and compensation, and legal remedies. We must also consider how the legislature and public will view the costs and benefits of class action procedures. A class action provides a practical way for individuals with small stakes in the litigation to be drawn together with sufficient joint interest and power to conduct a civil litigation effectively. Even where a victory by one plaintiff in a traditional two-party action would, by reason of stare decisis or res judicata, provide an effective remedy for all those in the putative class, there are certain advantages in public relations and psychological inducements that makes a class action attractive to its proponents, particularly in such public interest liti-
TL;DR: In this paper, the authors trace the history of a 16-year court battle over the child welfare system in Kansas City, Missouri, which eventually headed toward resolution as the result of an innovative public policy negotiation process.
Abstract: This article traces the history of a 16-year court battle over the child welfare system in Kansas City, Missouri, which eventually headed toward resolution as the result of an innovative public policy negotiation process. The process combined the substantive expertise of nationally and locally respected child welfare professionals with political muscle at the state, local, and community levels to develop and implement a plan for reform. If the results of this process become institutionalized in the Kansas City child welfare system, it will represent a significant transformation in the governing culture and practices of the system and the community it serves.
Journal Article•
TL;DR: In the case of the Pennsylvania Association for Retarded Children v. Commmonwealth of Pennsylvania (PARC) as mentioned in this paper, a group of parents of children labeled "mentally-retarded" brought a class action lawsuit challenging the legislation.
Abstract: I. INTRODUCTION This country has long recognized the necessity of an education in order to function productively in society. As suggested by one of the founding fathers, Thomas Jefferson, "some degree of education is necessary to prepare citizens to participate effectively and intelligently in our open political system."1 More recently, the Supreme Court recognized the importance of education in Brown v. Board of Education:2 "[I]t is doubtful that any child may reasonably be expected to succeed in life if he [or she] is denied the opportunity of an education."3 The Court reiterated its belief in Plyler v. Doe:4 "[B]y depriving the children of any disfavored group of an education, we foreclose the means by which that group might raise the level of esteem in which it is held by the majority .... Illiteracy is an enduring disability."5 Today this need to educate remains just as pressing. Our country is plagued by economic and social costs because of its failure to provide this "basic tool."6 Without an education, adults are unable to provide for themselves financially, much less for their families.7 As a result, many turn to crime.8 Theft, drugs, and violence become the solution, and society is left the victim of the very problem it helped to create.9 This Note focuses on children with mental impairments"10 and the public school system's current attempts to meet their needs. Historically, despite the American judicial system's recognition of the importance of education,11 children with disabilities were routinely denied the benefits of the free public education the Court required for children of all races in Brown.12 This denial took two forms. The first was outright exclusion of children with mental impairments from public schools,l3 and the second was more subtle, lying in the system's tendency to see only the impairment, not the unique individual.l4 Children's advocates began responding to these injustices in the 1960s and early 1970s, relying on the strong language in Brown to argue that the Equal Protection Clause of the Fourteenth Amendment protects not only children of different races, but also children with disabilities: "Such an [educational] opportunity, where the state has undertaken to provide it, is a right which must be made available to all on equal terms."15 The fruits of these advocates' labor were realized in two federal court cases in 1972. In Pennsylvania Association for Retarded Children v. Commmonwealth of Pennsylvania ("PARC"'),Is the court analyzed several Pennsylvania statutes that went beyond the subtle form of exclusion. The statutes permitted school directors to reject students who did not have the mental capacity of a typical five-year-old, and the laws permitted the State Board of Education to exclude "uneducable and untrainable" children from the public schools.17 These statutes prevented some 70,000 to 80,000 children with mental impairments from receiving a public education.18 A group of parents of children labeled "mentally-retarded" brought a class action lawsuit challenging the legislation.19 A three-judge panel noted that the statutes presented serious constitutional issues20 concerning the children's due process21 and equal protection rights.22 In reaching this conclusion, the court took particular offense at the labeling of certain children as uneducable, noting "expert opinion" had indicated that "a mentally retarded person can benefit at any point in his life and development from a program of education."23 The court recognized that the broad language in Brown extended beyond the race issue to include children with mental infirmities. PARC resulted in a consent agreement whereby mentally impaired children were guaranteed "access to a free public program of education and training appropriate to [their individual] capacities,"24 with the training to take place in a regular classroom if possible.25 Finally, a stipulation accompanying the consent agreement gave parents an active role in planning educational programs for children with disabilities. …
Posted Content•
TL;DR: In this article, the authors argue that judicial approval does not, and should not, immunize lawyer misconduct from the reach of state tort law, consumer protection law, criminal law, or state or federal antitrust law.
Abstract: Lawyer abuse in class action settlements is a widely recognized problem. One approach to lawyer abuse in class actions has received insufficient attention: suing the lawyers. Lawyers involved in class actions may engage in conduct that constitutes a civil or criminal wrong under state or federal law. The difference between these lawyers and other lawyers is that judges approve class action settlements after making findings on the adequacy of class counsel, the lack of collusion between class counsel and defendants, and the fairness of the settlement terms, including lawyers' fees. We argue that this judicial approval does not, and should not, immunize lawyer misconduct from the reach of state tort law, consumer protection law, criminal law, or state or federal antitrust law. Class action lawyers seem to assume that judicial approval cloaks their settlements in protection from these actions. We argue that this assumption is erroneous. First, collateral estoppel does not apply to bar suits aimed at lawyer misconduct because there is no full and fair opportunity to litigate these issues in the fairness hearing. Second, the doctrines that exempt state action, federal regulatory activity, and petitioning the government from the antitrust laws do not apply to the conduct of class action lawyers in negotiating a settlement or to the terms of the settlement approved by the court. We provide case examples to demonstrate the types of actions that could be brought against class action lawyers.
Journal Article•
TL;DR: In this article, the potential use of the procedural device of class actions for the benefit of groups or classes of taxpayers who share common or similar legal grievances in relation to the operation of Commonwealth or State taxation laws is discussed.
Abstract: Little attention has, to date, been given to the potential use of the procedural device of class actions for the benefit of groups or classes of taxpayers who share common or similar legal grievances in relation to the operation of Commonwealth or State taxation laws. It is posited that the use of the class action device by a grieved taxpayers deserves closer scrutiny. Circumstances where this procedural device is likely to be within the reach of taxpayers are highlighted.
Journal Article•
TL;DR: It is argued that a careful appreciation of the ADA's application to ETS-related claims should temper the worries of both those who see such claims as trivializing the ADA and those who worry that such claims may impose enormous burdens on American businesses.
Abstract: I. INTRODUCTION Environmental tobacco smoke ("ETS") is the "second-hand" smoke produced by cigarettes. Recent evidence suggests that ETS presents a broad-reaching public health risk.(4) For some individuals, however, ETS presents an especially acute threat. These individuals, many of whom have pre-existing respiratory or cardiac disabilities, find that significant exposure to ETS precludes them from continuing to work or participate fully in public life.(5) The danger of ETS could potentially be limited by federal legislation. In June 1997 negotiators representing state attorneys generals who had sued tobacco companies, tobacco manufacturers and lawyers representing class action plaintiffs signed a "Proposed Resolution" of their lawsuits which would require federal legislation.(6) Title IV of this proposal would, if implemented, restrict smoking to ventilated areas of public buildings regularly entered by 10 or more individuals at least one day per week.(7) The proposal, however, would create an exemption for restaurants (other than fast food restaurants), bars, private clubs, hotel guestrooms, casinos, bingo parlors, tobacco merchants, and prisons. To date, the fate of this proposal is uncertain.(8) Moreover, even if some form of the proposal is enacted, it may follow the settlement in not providing any private right of action to enforce the restrictions on public smoking.(9) Similarly, the proposal fails to provide any protection for individuals harmed by tobacco in the various buildings exempt from the restriction. As a result, whether or not some form of the settlement ultimately becomes law, individuals who are significantly harmed by ETS may still look to other federal remedies.(10) Chief among them is the Americans with Disabilities Act ("ADA").(11) In recent years, several individuals have used the ADA to challenge smoking policies of their employers or public accommodations. In effect, these individuals have claimed that the refusal to prohibit or limit smoking constitutes a refusal to provide a "reasonable accommodation" necessary to permit them to fully participate in a public accommodation or place of employment. Although these cases have sometimes failed due to their particular facts,(12) several courts have agreed that ETS-related claims may be actionable under the Act.(13) No court has disagreed. A recent jury verdict in which a severely asthmatic prison guard, who claimed to have required more than twenty emergency room treatments post-ETS exposure in the workplace, was awarded $420,300 and reinstatement suggests that the ADA's promise in this area may indeed be fulfilled.(14) Judicial acceptance of ETS-related ADA claims should not be surprising. A relatively straightforward reading of the ADA, and its history and regulations, makes clear that in certain instances the refusal to alter smoking policies, just like the refusal to alter any other policy that prohibits individuals with disabilities from working or fully participating in a public accommodation, may be discriminatory.(15) Nevertheless, the use of the ADA to challenge smoking policies raises important questions about the breadth and meaning of the ADA. For some advocates of disability rights, the use of the ADA for such cases may seem an unwarranted extension of the ADA. These advocates fear that such a use may weaken the Act's potential to prohibit "real discrimination" against individuals with traditional disabilities.(16) On the other side of the debate, employers and managers of public accommodations may fear that the application of the ADA to ETS-related claims threatens to "open the floodgates" to judicial review of many employment or business policies.(17) This Article explores the use of the ADA to challenge smoking policies and the fears and questions that such a use raises. We argue that a careful appreciation of the ADA's application to ETS-related claims should temper the worries of both those who see such claims as trivializing the ADA and those who worry that such claims may impose enormous burdens on American businesses. …
Posted Content•
TL;DR: In this article, the authors argue that state class action settlements encompassing exclusive federal claims entail process deficiencies that go beyond those present in ordinary class-action settlements: the bargaining power of the state class attorney with respect to the federal claims is impaired; the defendant's ability to engage in "plaintiff shopping" is increased; and the court may have less information to assess the fairness of a proposed settlement.
Abstract: In Matsushita Electric Industrial Co. v. Epstein, the Supreme Court held that a class action settlement approved by a state court is entitled to "full faith and credit," notwithstanding the fact that the settlement provides for a release of claims subject to the exclusive jurisdiction of federal courts. We analyze two questions raised by the opinion: when should state courts approve a settlement that provides for such a release; and when should such a settlement be subject to collateral attack in federal court. We argue that state class action settlements encompassing exclusive federal claims entail process deficiencies that go beyond those present in ordinary class action settlements: the bargaining power of the state class attorney with respect to the federal claims is impaired; the defendant's ability to engage in "plaintiff shopping" is increased; and the court may have less information to assess the fairness of a proposed settlement. State courts should therefore adopt a number of special precautions before approving such settlements. If state courts adopt such precautions, a decision to approve a settlement should not be subject to collateral attack. Collateral attack, however, should be permitted if the state court settlement structures do not provide for reasonable measures to guard against these process deficiencies and protect the federal interests at stake.
Book•
24 Jun 1997
TL;DR: The Fraser Institute has brought together an interesting volume that seems to bear the message of Adam Egoyan's movie The Sweet Hereafter; namely, that lawyers as ambulance-chasers are bad news as discussed by the authors.
Abstract: These fine books on aspects of law and criminality support the platitude that crime does not pay -- except for lawyers, criminologists and insurance companies. Canadian criminals put in more time in jail per dollar stolen in other countries, although these statistics predate the conviction of Alan Eagleson. Another statistic, even less likely to stir patriotic pride, is that Canadian youth, as Bernard Schissel points out, have the highest per capita rate of incarceration of any country in the world.If crime rates in Canada have dropped off in recent years, corresponding to the diminishing ratio of youth in the Canadian population, we still have a lot more lawyers. Prior to the Charter of Rights and Freedoms, Canadians had less than half as many lawyers per capita as the Americans but now we approach two-thirds of the American ratio (Law and Markets 77-81) creating "the danger of supply-driven and socially harmful increases in litigation" (85). Virtually, all of the contributors to Law and Markets bemoan Canada's increasing litigiousness; none defend the very quality that brought one of Canada's most honoured citizens to jail. The Fraser Institute has brought together an interesting volume that seems to bear the message of Adam Egoyan's movie The Sweet Hereafter; namely, that lawyers as ambulance-chasers are bad news. Law and Markets is concerned not with corporate criminality but with the prospect that enterprising lawyers, instigating class action suits on contingency fees, will be able to dupe civil juries, and cut into profit margins. Indeed, Richard Hazelton, the CEO of Dow Corning which filed for bankruptcy because of the silicone breast implant suit, tells a cautionary tale for Canadian businesspeople.Contributors point out that jurors lack competence to assess the scientific and technical evidence about toxic emissions, risks to health, the relationship of causality and legal accountability; prejudices about dioxin spills may skew assessment of the personal injury caused by the spillage. The one exception to the anti-litigation view of the 17 contributors to Law and Markets is Mark Mattson, an environmental litigator, who argues convincingly that the Canadian Environmental Protection Act needs radical revision or abolition. Mattson argues that the federal government should either enforce environmental standards or leave private litigators like himself to engage in civil ligation against environmental polluters. Mattson recommends that public interest groups and their lawyers split the fine levied on the offending corporations or municipalities (135). While Mattson may conform to the Fraser Institute's policy on deregulation -- "It is government intervention that stands in the way of a public right to protect community resources" (136) -- his proposals would encourage litigation, diminish shareholder profits and raise citizens' taxes. If the aim of Canadian economic regulation is, as Konrad von Finckenstein puts it, "user-friendly regulation," we are led to conclude that deregulation and user-friendly regulation are not the same thing. If the conflicting interests of Richard Hazelton and Mark Mattson reveal the current contradictions of capitalism, we might also note that the provinces geographically and ideologically closest to the Fraser Institute (British Columbia and Alberta) are the most litigious, while New Brunswick are Newfoundland are least litigious (158-9).An exciting challenge for the Fraser Institute would be to take on the human rights legislation that emerged after the Second World War, arising from a combination of anti-Nazi principle, Keynesian welfarism and acceptance of wartime control of goods and services in the public interest. Since human rights codes abridge several common law rights, of property and contract, specifically the right of business to discriminate in favour of preferred employees, buyers, tenants and customers, the Institute's views on James Walker's compelling account of the role of human rights legislation in limiting racism in the Canadian marketplace would be illuminating. …
TL;DR: The schizophrenic stepchildren of our civil litigation system are the Securities Class Action lawsuits as discussed by the authors, who are expected to serve two masters at the same time: the first is the goal of obtaining compensation for wronged investors who have suffered losses at the hands of corporate wrongdoers, and the second is filling the role of private attorneys general to sanction violators and deter future misconduct.
Abstract: Securities class action lawsuits just might be the schizophrenic stepchildren of our civil litigation system. They are expected to serve two masters at the same time. The first is the goal of obtaining compensation for wronged investors who have suffered losses at the hands of corporate wrongdoers. The second is filling the role of private attorneys general to sanction violators and deter future misconduct.2 There is often a tension between these two masters. Approaches that provide the most effective deterrence of future fraud may not necessarily provide the largest loss recovery.
1 Jan 1997
TL;DR: One of the most damaging accusations made against class action litigation, particularly securities litigation, is the claim that it is "lawyer-driven litigation", which has been proven to be false.
Abstract: One of the most damaging accusations made against class action litigation, particularly securities litigation, is the claim that it is "lawyer-driven litigation.", In the parlance of, among others, the proponents of the Republican Contract with America, lawyer-driven litigation is inherently abusive.' Recent reform efforts, including the adoption of the Private Securities Litigation Reform Act (the "Reform Act"),' have been spurred by the effort to transfer control of litigation away from lawyers and back to clients.'