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2018-2019 Closer Looks

‘JUNK SCIENCE’ MAKING ITS WAY INTO AMERICAN COURTROOMS

In Daubert v. Merrell Dow Pharmaceuticals (1993), the Supreme Court of the United States bestowed upon judges the responsibility of serving as “gatekeepers” to weed out junk science and prevent it from being offered to jurors in their courtrooms. Unfortunately, many judges have either refused to accept this role or have fallen short in their efforts to do so. There is a growing trend of judges and juries relying on unsubstantiated “science” as the basis of massive judgments against corporate defendants.

This problem is exacerbated by the fact that one of the worst examples of “junk science” that found its way into our courts was funded by American taxpayers.

The International Agency for Research on Cancer (IARC), supported by the National Institutes of Health (NIH), issued a report concluding that glyphosate, the active ingredient in the herbicide Roundup®, is carcinogenic. The IARC report was the basis for a San Francisco jury to enter a jury award of more than $289 million against Monsanto. The essential evidence in this case—the IARC report—is in stark contrast to more than 800 scientific studies as well as analyses by the U.S. Environmental Protection Agency and the NIH. Despite the judge noting the expert evidence was “thin,” the jury awarded a massive verdict to the plaintiff, which included a $250 million punitive damages award. Fortunately, the judge later reduced the punitive damages award to align with due process limits.

Since its creation in the 1970s, IARC, located in Lyon, France, has reviewed over 1000 chemicals and agents of exposure and placed them in one of five different categories; (1) definitely carcinogenic to humans; (2A) probably carcinogenic to humans; (2B) possibly carcinogenic to humans; (3) not classifiable as to its carcinogenicity to humans; (4) probably not carcinogenic to humans.

Of the 1000 chemicals and agents reviewed, only one—caprolactam, a chemical used in Spanx®, has been found to be probably not carcinogenic.

Closer scrutiny of the IARC process reveals that it was advised by an “invited specialist,” Christopher Portier, in its work on glyphosate. At the same time Mr. Portier was working for the agency, he was being paid by the Environmental Defense Fund, an anti-pesticide group. Moreover, Mr. Portier received $160,000 from law firms suing over glyphosate. When asked about this potential conflict of interest, Mr. Portier initially claimed to be advising firms on other IARC- related lawsuits and not glyphosate litigation. He later acknowledged that his statement was wrong. It is also worth noting that Mr. Portier had no experience with glyphosate prior to his work on it for IARC.

Following Mr. Portier’s arrival at IARC, the final glyphosate study was altered in at least 10 ways to remove or reverse conclusions finding no evidence of carcinogenicity. The agency removed multiple scientists’ conclusions that studies found no link between glyphosate and cancer in lab animals and statistical analyses of studies with negative findings were turned into positive ones. The determination that glyphosate was “probably carcinogenic” was based on “limited evidence” of carcinogenicity in humans and “sufficient evidence” in experimental animals.

The shakiness of the scientific methods used by IARC in developing the glyphosate report are gravely concerning, but even more troublesome, is the influence it is having on litigation in the United States. The IARC is not accountable to American voters or to any U.S. agencies; however, it is having an undeniable impact on U.S consumers and corporations because of the weight its research is given in California, which mandate warnings based on IARC findings, and by U.S. judges.

Concern about IARC’s work on glyphosate led the U.S. House Committee on Space, Science and Technology, which has stated that the IARC finding on glyphosate is an “affront to scientific integrity that bred distrust and confusion,” to request that (now former) IARC Director Christopher Wild appear before the Committee. Mr. Wild refused to testify, and his successor, Elizabete Weiderpass, has not responded.

The problem of junk science in litigation, however, is not confined to IARC. In fact, it is a problem that many defendants face in Judicial Hellholes all around the country. For example, as discussed in the Twin Cities section, Minnesota Attorney General Lori Swanson relied on the inferior scientific expertise of a professor in a groundwater contamination lawsuit against 3M, despite her own state Health Department’s strong disagreement with his conclusions. Faced with the prospect of an award fueled by junk science, 3M settled the case for $850 million.

In yet another Judicial Hellhole, a St. Louis, Missouri jury awarded a massive $4.5 billion award to 22 plaintiffs after concluding that there was asbestos in Johnson & Johnson’s talcum baby powder, and that it caused ovarian cancer. Again, the role of expert testimony was crucial in the outcome. Although both the American Cancer Society and the U.S. Food and Drug Administration have concluded otherwise, jurors were told by plaintiffs’ “expert” that talcum powder causes cancer.

Finally, this year’s Florida section highlights the Florida Supreme Court’s refusal to adopt the expert evidence standard laid out by the U.S. Supreme Court in Daubert. In 2013, the Florida legislature enacted a statute to bring state law on expert evidence in line with more than 30 states and the federal courts based on the Daubert process but the high court flatly rejected the standard in 2018.

Reasonable rules and procedures based on Daubert are essential to a balanced legal system, and it is the responsibility of the judiciary in the country as well as lawmakers to ensure that junk science does not find its way into our courtrooms. Jurors should expect and deserve to be presented only with reliable scientific information to support their deliberations.

FIGHTING “NO-INJURY” LAWSUITS

It seems like a straightforward, commonsense principle: Before filing a lawsuit, a person must experience an injury. In recent years, however, plaintiffs’ lawyers are chipping away at this core requirement, bringing claims based purely on speculation, risks of future harm, creative theories of financial loss created by hired gun “experts,” and, simply, nonsense.

The requirement that a plaintiff show an actual injury is a critical safeguard for the civil justice system. It ensures that courts use their power and their limited resources to resolve real problems and compensate people for genuine harms caused by the wrongful conduct of another. Despite constitutional, statutory, and common law requirements, plaintiffs’ lawyers are inundating courts with lawsuits that demand that businesses pay money to people who have experienced no harm.

In 2016, the U.S. Supreme Court, dealt a blow to “no-injury” lawsuits in Spokeo, Inc. v. Robins. There, the plaintiff claimed Spokeo violated the Fair Credit Reporting Act when it placed a profile on its website indicating the plaintiff was married with children, employed, held a graduate degree and was relatively affluent—information that was favorable, but inaccurate. The Supreme Court ruled that “a bare procedural violation, divorced from any concrete harm” is insufficient to show an “injury-in-fact” that is required for a federal court to consider a claim.

Yet, “no-injury” litigation continues. Here are highlights of recent developments in this area.

INVENTING AN INJURY: THE SIZE OF AN EYE DROP

Plaintiffs’ lawyers have filed several consumer class actions targeting glaucoma medication. These lawsuits do not claim the medications are ineffective or unsafe. Rather, they simply assert that the bottles dispense drops that are larger than necessary.

Two federal appellate courts have exposed the flaws in this theory. In Eike v. Allergan, the Seventh Circuit reversed an order granting class certification, finding the plaintiffs had alleged no wrongdoing and experienced no injury. Rather, the lawsuit was “simply based on dissatisfaction” and speculation, without any proof, that a bottle that dispensed smaller drops would be more cost effective.

The First Circuit reached the same result, but on a different basis. In Gustavsen v. Alcon Laboratories, Inc., the court found that the FDA had approved the medication, including how it is dispensed, and any change in the bottle would need to be examined and approved by federal regulators. While the First Circuit accepted the plaintiffs’ allegations that they had experienced a financial loss, the court ruled that federal law preempts lawsuits that would require redesigning the bottles.

In the midst of these two cases, the Third Circuit in Cottrell v. Alcon Laboratories, Inc. revived an identical “no-injury” lawsuit. Despite the conflict between Third and Seventh Circuits, the U.S. Supreme Court denied certiorari in May 2018.

ATRA filed amicus briefs in Eike, Gustavsen, and Cottrell, arguing that creative theories of damages are not a substitute alleging an actual injury, and has also filed amicus briefs in “no-injury” cases involving automobiles and other products.

TARGETING A REMOTE CHANCE OF FUTURE INJURY: AUTOMOBILE HACKING

Another variety of “no-injury” lawsuits are claims that a product contains a flaw that has not materialized, but could lead to some future problem. Since tort law generally does not permit individuals to seek compensation for harms that have not yet occurred, these claims allege that consumers “paid too much” for a product or that the resale value of the product is lower than it should be. For example, plaintiffs’ lawyers have filed class actions against automakers alleging that their vehicles’ computer systems are susceptible to hacking, placing them at risk of theft, damage, serious physical injury, or death. Yet, this has never occurred.

In December 2017, the Ninth Circuit affirmed dismissal of one of these lawsuits, finding the plaintiffs experienced no injury. In Cahen v. Toyota Motor Corp., the appellate court found that the plaintiffs alleged only speculative risks and defects, had not shown these risks affected the choice of consumers to buy the vehicles, and had not shown these risks had any impact on the value of the cars. A federal district court in Illinois, however, certified a similar case including classes of consumers in Illinois, Michigan, and Missouri who allege that infotainment systems in Jeep Grand Cherokees and other vehicles could be hacked and remotely controlled. The Seventh Circuit denied review of the trial court’s rulings finding standing and certifying the classes, and the automakers filed a petition for certiorari with the U.S. Supreme Court.

As more and more products from garage doors to home security systems connect to the internet, these types of cases threaten to open the floodgates to class action lawsuits alleging nothing more than a vulnerability that has never been breached in real world conditions.

CHALLENGING MARKETING WHERE NO ONE PERSON IS MISLED: THE “FOOD COURT”

Plaintiffs’ lawyers are filing numerous lawsuits challenging how food is advertised and packaged when no one is actually misled. The lawyers who file these claims have developed a lucrative assembly-line practice that takes advantage of vague consumer laws and judges who are reluctant to promptly dismiss absurd claims.

Some judges have appropriately responded to ridiculous lawsuits. For example, federal courts in California and New York found that naming a soda “diet” does not lead reasonable consumers to believe a soft drink is a weight- loss product or health food. A New Yorker who filed a $20 million lawsuit after she bought an 8-piece bucket of chicken that was not filled above the rim as it looked on TV found herself out of luck. The Ninth Circuit affirmed dismissal of a lawsuit claiming Starbucks deprived consumers of their due share of coffee when their iced coffee included, you guessed it, ice. These decisions follow the Seventh Circuit’s rejection of a class action settlement in which lawyers would have received over a half million dollars in fees for bringing class actions alleging that the bread in Subway’s “Footlong” sandwiches sometimes did not extend a full twelve inches. The court called the litigation “no better than a racket” that “should be dismissed out of hand.”

On the other hand, some judges have refused to dismiss cases as ludicrous as one claiming that consumers who buy “raspberry” donuts think it contains real fruit that would “help fight against cancer, heart and circulatory disease, and age-related decline.” Even when courts eventually dismiss a lawsuit, businesses incur thousands of dollars in legal fees. Often, companies settle meritless claims to avoid lengthy litigation. These needless costs are passed on to consumers.

Commonsense legislation has been proposed which would require private lawsuits filed under state consumer laws to allege consumers experienced an actual loss of money because of the allegedly misleading practice. Legislation also should reaffirm that courts may promptly dismiss implausible claims where no reasonable consumer would be misled by the practice at issue. As discussed earlier, such efforts are underway in Missouri.

SUING OVER TECHNICALITIES: ACCESSIBILITY LAWSUITS

Lawyers and serial plaintiffs are visiting restaurants looking for lawsuits, rather than a burger and fries. They know there are thousands of disability access requirements—ranging from the height of a mirror in a bathroom to the angle at which water can come out of a drinking fountain. Trivial violations of Americans with Disabilities Act’s standards are not hard to find.

As Anderson Cooper reported on 60 Minutes, “drive-by” ADA lawsuits are plaguing businesses large and small. Plaintiffs’ lawyers have even taken to surfing the internet for violations, claiming websites that sell products or services do not incorporate features making them accessible to people who are blind or visually impaired. As a result, the number of ADA access lawsuits has nearly tripled over the past five years.

In one such lawsuit, disabled individuals visited two Steak ‘N Shake restaurants and found that the parking lots had slopes that exceeded the ADA limit of 2.1%. They did not bring the problem to the restaurant’s attention; they called their lawyers. The lawyers, who have filed numerous ADA accessibility lawsuits, then dispatched a paid “investigator” to additional restaurant locations to look for more violations. Nothing in the case indicated that anyone with a disability complained about the parking lots. Yet, a federal district court certified a class that would have imposed obligations on every Steak ‘N Shake location in the United States.

The Third Circuit reversed. In a July 2018 ruling, the appellate court found that while the class representatives’ visits to the two locations alleged a sufficiently concrete injury to have standing to bring the claim, class certification was improper. The plaintiffs had made no showing that other people with disabilities had experienced difficulty in Steak ‘N Shake’s parking lots. The lawsuit’s reach was also problematic as it included any accessibility issue—whether it involved aisles, counters, doorknobs, bathroom stalls, or signage—about which no one had complained.

While this case eventually reached the right result, thousands of businesses receive letters from plaintiffs’ lawyers each year demanding extortionate payments to avoid or settle lawsuits alleging accessibility violations. ATRA supports federal and state legislation providing businesses with a reasonable amount of time to address an issue after a person brings it to the business’s attention before a lawsuit may be filed.

ACTIVIST STATE ATTORNEYS GENERAL LOOKING TO REGULATE THROUGH LITIGATION

Activist state attorneys general are seizing the opportunity to use current “hot-button” issues, like the opioid crisis and climate change, to propel forward their personal careers and generate campaign dollars for future political aspirations. Looking to regulate these industries through the use of litigation, state attorneys general have decided to pursue litigation at the urging of plaintiffs’ lawyers who stand to gain hundreds of millions of dollars if they are successful. Typically, these arrangements pay plaintiffs’ lawyers roughly one-third of the take plus their expenses. As a result, the incentive for these lawyers is to maximize their fees irrespective of the public interest.

Strong evidence of this problem can be found in investigations by the Wall Street Journal’s editorial board and a Pulitzer Prize-winning New York Times series. Such reporting has shown how personal injury lawyers often shop their ideas for potentially lucrative lawsuits against corporate defendants to friendly governmental officials, most prominently state attorneys general, whom they also support with generous campaign contributions.

Lawsuits brought by powerful state or local governments must serve the public interest, and not merely the profit-seeking interests of politically influential members of the plaintiffs’ bar.

OPIOID LITIGATION

Americans are rightly concerned about the opioid crisis, as we lose more than 100 of our community members each day from drug overdoses. That is the equivalent of the death toll from September 11 every three weeks.

In October, President Trump signed a landmark bill intended to address the nation’s opioid crisis. The bill was supported in Congress by wide bipartisan margins. The administration also announced additional funding– the Department of Health and Human Services awarded $1 billion in grants to combat the opioid crisis. It is reassuring to see that even in highly partisan times our elected and appointed officials can put the interests of the American people ahead of political considerations.

Despite this progress, the opioid crisis is the basis for more than 1,000 lawsuits brought by state, county, municipal and tribal governments—and virtually all of them are represented by lawyers paid on a contingency basis. Under these arrangements, lawyers for these governmental entities are not paid unless their clients “win.” But winning does not necessarily solve the crisis at hand.

Governments and their lawyers point to the “success” of the tobacco litigation from a generation ago as a basis to justify litigation against drug manufacturers and distributors. A closer examination of the experience in Texas proves that corruption is a real problem when enormous sums of money are on the line, and litigation cannot assure that settlements are addressed entirely toward the underlying problem. According to the Dallas News, then-Texas Attorney General Dan Morales spent four years in federal prison because he forged documents to get a personal friend of his a share of the enormous legal fees generated in the state’s case, even though he had done no work in the matter.

While Texas receives $490 million each year under the tobacco settlement, only $10.2 million was allocated toward anti-smoking efforts in 2016. Matthew Myers of the Campaign for Tobacco Free Kids stated that “measured against the potential successes and the potential good that could have been achieved, Texas and many other states fell far short of their objectives.” This is hardly surprising considering barely 2 percent of the annual settlement payment to the state supports smoking cessation. There is one group, however, that did exceedingly well: the personal injury lawyers. The “big five” Texas tobacco settlement lawyers receive about $120 million each year for their work in the 1990s.

Former Mississippi Attorney General Mike Moore, who now serves as a “consultant” for Ohio Attorney General Mike DeWine in his opioid litigation, paid his private-sector associates in the tobacco litigation more than $1.6 billion in fees without ever providing citizens a full accounting of the work they performed. With many of the same characters involved in the opioid litigation, it is hard not to expect similar mishandling of money this time around.

Another important contrast between the opioid crisis and tobacco is that prescription opioids are regulated from start to finish—from design and safety approval by the Food and Drug Administration to quantities that are manufactured, where they are distributed, and which doctors prescribe them—by the Drug Enforcement Administration. This is a legal, regulated product that works as intended, and can be used only after prescribed by a licensed physician. By contrast, tobacco largely was unregulated at that time, although health risks from smoking were plainly affixed on the side of every cigarette pack.

The reality is that this complicated problem requires a comprehensive solution. History shows that litigation against manufacturers and distributors will do nothing to stop the scourge of illegal opioids, particularly synthetic fentanyl, shipped into the country from China. And we cannot ignore the fact that litigation seeks to lay all these problems at the feet of manufacturers and distributors who are subject to extensive government regulation.

Our civil justice system exists to resolve disputes—not to perform the functions of legislators and regulators. Broader public policy challenges should be addressed by those entrusted with such responsibilities. In the case of opioids, that includes Congress, state legislators and federal and state public health officials and regulators. They are obliged to serve and protect the public, and they are accountable to us all. By contrast, lawyers operating on a contingency fee basis are driven by a profit motive. As the sad tale in Texas demonstrates, lawyers’ relationships to elected officials can be problematic, to say the least.

Whether the legislative solution that emerges from Congress “solves” the problems with opioid abuse remains to be seen. But this is the right way for our country to address this critical national issue. Let’s not leave this to the courts—and the lawyers.

CLIMATE CHANGE LITIGATION

Like the opioid crisis, climate change has become a vital issue for all Americans that should be addressed by our elected officials and duly appointed expert regulators. It is their responsibility to develop and execute appropriate public policy that serves the public interest. Exactly how that should be done is the subject of great dispute and controversy. Some believe that any and all activities that do or could harm the environment should be all but eliminated. Others put a far greater emphasis on the impact of regulation and mitigation on our economy and prospects for growth. Reasonable people can, and do, disagree about these issues.

One topic that should not be in dispute, however, is the role of litigation in this area. Courts are appropriate for settling legal disputes, not setting environmental policy that has a profound impact on countless aspects of our daily lives and the continuing prospects for a strong and vibrant economy.

In recent months, we have seen an increase in state and local climate litigation in several California counties, as well as New York and Massachusetts. Though the litigation may thus far seem to be sporadic attacks against the energy industry, in reality it is a highly coordinated effort. The Competitive Enterprise Institute recently issued a report detailing a “secret meeting” in 2016 at Harvard University between attorneys associated with various attorneys general offices across the country to discuss climate change litigation and holding oil companies liable. The report describes the climate change litigation as an “extensive and elaborate campaign using elective law enforcement offices, in coordination with major donors and activist pressure groups, to attain a policy agenda that failed through the democratic process.”

The primary claim thus far is that energy companies have allegedly misled the public about climate change, in much the same way others have been targeted. Therefore, the argument follows, they should be forced to pay millions in settlements. Plaintiffs also are bringing claims under the public nuisance theory, alleging that energy companies contribute to global warming- induced sea level rise. The lawsuits seek damages for both past and future natural disasters, including flooding.

Fortunately, judges in California and New York have dismissed some of the claims brought by the state and local governments, recognizing that the courts are not the appropriate forum for addressing climate change. However, these developments have not deterred the efforts and more state attorneys general are expected to file similar lawsuits.

One of their main targets, ExxonMobil, has decided to fight back and has filed a lawsuit against a group of California municipalities and officials, as well as Matt Pawa, a Hagens Berman attorney who has been hired to work on the climate change litigation on a contingency fee basis. Exxon’s lawsuit alleges that these California municipalities have engaged in a civil conspiracy against energy companies and are operating off of Pawa’s “playbook” that includes the efforts by other state attorneys general.

This type of litigation has a profound and significant negative economic impact and should be called out for the sham that it is. State attorneys’ general must remain focused on protecting the interest of the public and serving their communities, and rebuff the advances of opportunistic plaintiffs’ attorneys. If allowed to continue unchecked, the costs will not be restricted to the companies so arbitrarily pursued. Rather, taxpayers will foot the bill and the trial bar will move on to another scapegoat to line its pockets.

“[M]easured against the potential successes and the potential good that could have been achieved, Texas and many other states fell far short of their objectives.”