Report: Bankruptcy legal costs reach $84 million for PG&E

Photo Credit: David Tran Photo/Shutterstock.com as originally reported by The Recorder.

Photo Credit: David Tran Photo/Shutterstock.com as originally reported by The Recorder.

Legal costs associated with Northern California wildfires and a natural gas explosion total $84 million, based on a January bankruptcy filing, according to court filings reviewed by The Recorder.

“Four outside law firms have billed Pacific Gas and Electric Co. at least $84 million for legal services related to the company’s January bankruptcy filing,” the April 2 article at law.com reports. “The utility company disclosed its legal spend in a series of court filings last month, as it sought approval from U.S. Bankruptcy Judge Dennis Montali to continue employing the law firms.”

PG&E listed more than $50 billion in estimated liabilities, the article notes.

“PG&E has hired Chicago-based Jenner & Block as special corporate defense counsel for state and federal regulatory matters during the Chapter 11 proceedings,” The Recorder reports. “Jenner & Block is also handling a criminal case involving PG&E, connected to a natural gas explosion that occurred in the city of San Bruno, California, in September 2010. According to the March 15 court filing, PG&E has paid the firm $3.57 million during the year leading up to the Chapter 11 filing. San Francisco based Keller & Benvenutti is also representing PG&E in bankruptcy court. Since May 2018, the firm has advised PG&E on legal and financial matters regarding potential liabilities resulting from 2017 and 2018 Northern California wildfires.”

Yahoo data-breach settlement filed for $117.5 million

YAHOO_headquartersA class action settlement for $117.5 million has been filed following data breaches affecting billions of Yahoo accounts.

The Recorder at law.com reports on the $117.5 million settlement, which was filed in the U.S. District Court for the Northern District of California after a federal judge rejected an earlier preliminary approval.

“The settlement, filed Tuesday with the U.S. District Court for the Northern District of California, includes a single fund from which $55 million would be available for out-of-pocket costs and $24 million in identity theft protection for class members (or $100 payments to those who already have credit monitoring),” The Recorder reported on April 9. “It also includes $30 million in attorney fees and $2.5 million in legal costs, a slight reduction from the original fee request.”

Data breaches in 2013 and 2014 accounted for more than 3 billion accounts that were hacked, according to Yahoo. Defendants include Altaba Inc., the division of Verizon formerly known as Yahoo.

Lawsuits pile up against Purdue Pharma, other drug companies over OxyContin

Photograph: Jessica Hill/AP, published in a report by The Guardian on 3/28/19.

Photograph: Jessica Hill/AP, published in a report by The Guardian on 3/28/19.

Amid hints of a pending bankruptcy filing, officials are weighing their options in a mounting legal push against Purdue Pharma, manufacturer of the narcotic prescription painkiller, OxyContin.

Oklahoma settled for $270 million with Purdue and the company’s owners, the Sackler family, The Guardian reports. Oklahoma’s attorney general, Mike Hunter, feared that the state might be left unable to collect if the company filed for bankruptcy, according to the publication.

“The $75m payment by members of the Sackler family, as part of the $270m, was a first,” The Guardian notes, “the first time the family has directly contributed toward addressing the consequences of the opioid epidemic.”

“The Oklahoma settlement is a foretaste of a barrage of civil lawsuits in the pipeline against not only Purdue but dozens of drug manufacturers, distributors and pharmacies as cities and states seek billions of dollars from those they blame for the biggest drug epidemic in US history,” The Guardian reports.

HUD brings charges of housing discrimination against Facebook

 Dr. Ben Carson, United States Secretary of Housing and Urban Development. Photo credit: hud.gov.


Dr. Ben Carson, United States Secretary of Housing and Urban Development. Photo credit: hud.gov.

The U.S. Department of Housing and Urban Development has announced a charge against Facebook, alleging the tech giant violated the Fair Housing Act “by encouraging, enabling, and causing housing discrimination through the company’s advertising platform.”

In a recent press release, the agency previewed its case. “Today’s action follows HUD’s investigation of a Secretary-initiated complaint filed on August 13, 2018…HUD alleges that Facebook unlawfully discriminates based on race, color, national origin, religion, familial status, sex, and disability by restricting who can view housing-related ads on Facebook’s platforms and across the internet. Further, HUD claims Facebook mines extensive data about its users and then uses those data to determine which of its users view housing-related ads based, in part, on these protected characteristics.”

The Washington Post reports that HUD also “alerted Twitter and Google last year that it was scrutinizing their practices for possible housing discrimination.”

The New York Times reports that Facebook officials voiced surprise:

“Facebook, which HUD said controlled about 20 percent of the online advertising in the United States, appeared to be taken aback by the suit.”

Farmers Breathe Easier After N.C. Trial. More Battles on the Horizon

By Sara Corcoran, Courts Monitor Publisher
(Originally published in CityWatch LA on 4/1/19)

Nationwide, including California, agricultural interests are likely breathing a collective sigh of relief after a North Carolina jury awarded a relatively low judgement to 10 plaintiffs in that state’s latest round of nuisance” hog farm lawsuits.

However, it would be premature to assume that farmers are in the clear: In North Carolina alone, close to 21 cases are on the docket with hundreds of plaintiffs still awaiting their day in court.

Nuisance litigation has taken on national implications in part because they involve “concentrated animal feeding operations,” or CAFOs. The practice of centralizing production began with poultry farms in the 1950s and is a common practice both globally and in the U.S. For example, there are close to 20,000 CAFO operations across the U.S., with approximately 1,000 in California.

N.C. grocery store shows support for hog farms.

N.C. grocery store shows support for hog farms.

Initially, the first three North Carolina hog farm trials made headlines as juries awarded $500,000 million to plaintiffs (North Carolina state-mandated caps on non-economic damages will lower the final judgment to the $100 million range). The next two trials, however, brought awards of “only” about $500,000. This represents a significant departure from the aforementioned pattern as these judgments are supposed to be “discovery pool” trials that will inform any potential future settlements of the still-pending cases. The latest trial was before a judge considered more plaintiff-friendly than the judge for the previous case; that judge decided that the pork producers would not even face punitive damages.

It’s worth noting that people suing assure juries they “like bacon” and that the lawyers involved have been linked to anti-animal agriculture groups. They argue against concentrated corporate farming and harken back to a time in the 1970s when small farms produced a few hogs. With twice as many people on earth now that would lead to pork prices that only wealthy lawyers could afford.

I should also note that in these types of personal injury-contingency cases, legal fees consume most of the award. Specifics of settlements are usually confidential, however, expert witnesses, miscellaneous support expenses, and 40 percent fees off the top can leave little of the awards to the original injured parties. Under the terms of any probable payout scenario, even with all the cases under appeal, the last two North Carolina cases are significant financial setbacks for the litigation firms suing the farms. Notwithstanding that, it’s actually highly unusual to have such trials because close to 95 percent of all civil injury cases reach pre-trial settlements.

Some agricultural observers posit that the North Carolina arguments over odor and other issues could bypass state “right to farm” laws because those harms are not usually addressed the way water quality or health issues might be. The idea is that juries, not lawmakers, can drive policy changes.  Every state has some version of right-to-farm, and they vary greatly. North Carolina, for example, updated its farm laws after the hog farm cases began with Republican lawmakers overriding a veto from Democratic Governor Roy Cooper. The state’s Pork Council makes the political landscape clear: “[On the hog farm cases]  all across eastern North Carolina and beyond, county commissioners and elected town officials have done the same. Elected officials (of both political parties, it must be said) have rendered their verdicts.”

Yet another aspect of the litigation, as I noted in an earlier column, is that it has drawn the attention of nationally known asbestos-lawsuit firms. Since asbestos litigation has forced about 100 companies into bankruptcy, there are serious implications for North Carolina’s economy, which has suffered from an exodus of jobs from the tobacco and textile industries. Additional parallels to asbestos litigation have also been noted.  Tactics, such as not suing individual farmers (who juries might find sympathetic) but instead suing the companies providing the pigs amid very specific contracts. Large corporations are less sympathetic on the national stage and tend to have more resources.

There have been allegations of other parallels to asbestos litigation tactics such as mass sign-up of African-American plaintiffs to fit a narrative that hog farms are located only in economically disadvantaged African-American communities. But in the last trial, at least five of the neighbors who lived very close to the farm (and were white) testified there was no nuisance. The lawsuits also target the deep-pocketed owner of the hogs, not the farmers who actually raise them.

Nationally, the North Carolina lawsuits are also being monitored because they technically sidestep most of the core environmental debates, like health concerns, water quality or even how carbon footprints of animals are managed. These lawsuits focus on how much the smell of the operations impact neighbors, and farmers are quick to point out that there were virtually no complaints about odors and other issues (flies, buzzards, even truck traffic) until after a team of lawyers began organizing the lawsuits a few years ago. A local journalist covered that aspect of the story at a Wilmington TV station website; the report at WECT offers detailed background on how the cases came to exist.

That report illustrates how people’s perspectives on the hog farm trials fall along a rural-urban divide. Farm-area families are outraged that urban-area juries are not visiting the actual farms being sued, especially when they hear journalist Casey Roman, who did the WECT report, tell an interviewer: “I went and stood maybe a foot from the edge of the lagoon, in front of millions of gallons of pig waste… I didn’t smell anything. At that point, I was like, alright, this is clearly something more than what I’ve been reading.”

That contrasts sharply with reporting in the California-owned urban dailies in Charlotte and Raleigh, where coverage has been seen as decidedly more anti-farmer.

What seems clear, for now, is that at least one North Carolina hog farmer is out of the pig business, and state ag leadership stresses that if it can happen to him it can happen to anybody. The argument of “who came first?” is fairly weak in these cases because even residences that pre-date the hog farm in question moved into an area already hosting centralized poultry operations and other animal-farming activity.

The idea that what happens in North Carolina will not stay in North Carolina, but indeed can happen anywhere, means that the hog farm trials are really a de facto debate over national policy. Hog litigation averts involvement of elected officials and diverts power directly to judges and juries – and with multiple billions of dollars at stake, not to mention possible impacts to the U.S. food supply, you can bet these cases are about more than tomorrow’s bacon and will soon be headed to a breakfast table near you.

(Sara Corcoran writes DC Dispatch for CityWatch. She is the Publisher of the California and National Courts Monitor and contributes to Daily Koz, The Frontier Post in Pakistan and other important news publications.)

Passenger sues airline for suitcase falling on his head

Photo Credit: Joe Amon, The Denver Post as part of a report on the Southwest Airlines law suit.

Photo Credit: Joe Amon, The Denver Post as part of a report on the Southwest Airlines law suit.

An airplane passenger has sued Southwest Airlines in U.S. District Court in Denver after a suitcase fell from an overhead bin onto his head, reports The Denver Post.

According to the report, “Charles E. Giebel II was in his plane seat at Denver International Airport awaiting a flight to Newark, New Jersey on March 22, 2017, when an ‘infirm’ passenger trying to load a suitcase in an overhead bin dropped it on Giebel’s head, the lawsuit said.”

Timothy Fields, the Colorado Springs attorney that filed the lawsuit, claims flight attendants should have noticed the passenger was struggling with his suitcase and should have helped. 

The Denver Post reported that Giebel is seeking an unspecified award from Southwest.

Connecticut’s highest court rules against Remington over Sandy Hook

Photo Credit: REUTERS/Joshua Roberts, as included in the report by Reuters on 3/14/19.

Photo Credit: REUTERS/Joshua Roberts, as included in the report by Reuters on 3/14/19.

Remington Outdoor Co. Inc. can be sued for the 2012 mass shooting at Sandy Hook Elementary School in Newtown, Conn., that left 20 school children aged 6 and 7 and six adult staff dead, a court ruled on March 14. 

This marks a “setback for gun makers long shielded from liability in mass shootings,” Reuters reported.

“In a 4-3 ruling widely expected to be appealed to the U.S. Supreme Court, Connecticut’s highest court found the lawsuit could proceed based on a state law protecting consumers against fraudulent marketing,” noted Reuters.

Litigants argued that Remington marketed its AR-15 Bushmaster rifle “based on its militaristic appeal.”

USA Today noted the larger ramifications of the ruling: “By ruling against a gun-maker, the Connecticut Supreme Court appears to have pierced a legal shield that could lead to more lawsuits and damaging disclosures involving the arms industry, gun control advocates say.”

The newspaper added that the method of marketing was questioned, quoting Justice Richard Powers in the majority opinion: “The regulation of advertising that threatens the public’s health, safety and morals has long been considered a core exercise of the states’ police powers.”

Pre-trial bail rejected by San Francisco judge

San Francisco’s money bail schedule deprives plaintiffs of their rights, a judge ruled while overturning the law, possibly creating an opening for additional challenges.

Findlaw.com reports that U.S. District Judge Yvonne Gonzalez Rogers ruled that the sheriff’s use of the bail schedule “has significantly deprived plaintiffs of their fundamental right to liberty by sole reason of their indigence.”

The concept of bail, Findlaw.com notes, “means that thousands of potentially innocent people are stuck in jail — often for minor offenses — simply because they can’t afford bail.”

One of the plaintiffs in the case decided by Judge Rogers lost her job while in custody, only to have the charges against her dropped.

The ruling is not an isolated rejection of money bail, the site notes. “Cities, states, courts, and the Department of Justice have come out against pre-trial money,” the site reports.

Arbitration gains currency after Supreme Court decision

unnamed-4Employees trying to take companies to court face more likelihood of arbitration based on a recent U.S. Supreme Court ruling, The Recorder at law.com reports.

A string of U.S. Supreme Court decisions favoring arbitration contracts, including the recent split decision in Epic Systems Corp. v. Lewis, changed the landscape of workplace litigation, the site notes.

“Claims of persistent sexual harassment and discrimination in the workplace, fast-food workers shorted on pay and gig economy contractors fighting for employee status have all been routed to arbitration in decisions citing Epic,” The Recorder notes.

“[Epic] changes the dynamics in a profound way,” Gerald Maatman, a partner at Seyfarth Shaw in Chicago told The Recorder. “It’s one of the most important decisions from the Supreme Court that impacts workplace issues.”

“In collaboration with San Francisco-based legal research company Casetext, The Recorder affiliate The National Law Journal analyzed 92 decisions from U.S. courts of appeal and federal district courts that cited Epic in the seven months between when it was handed down last May and the end of 2018,” the article notes. “Among those cases, 10 circuit court and 49 district court decisions centered on arbitration and dealt with workplace claims — and the majority either compelled arbitration or revived it as a live issue.”

In California, new privacy, data protection rules could fuel lawsuits

shutterstock_329735990-2California’s new privacy law could spur a rash of class action lawsuits against companies, officials warn.

The Recorder at law.com reports that the regulations, due to go into effect Jan. 1, 2020, “will bear more than a passing resemblance to the European Union’s General Data Protection Regulation, empowering Californians with more control over the way their data is collected, shared or viewed by companies on a daily basis.”

Reece Hirsch, a partner at Morgan, Lewis & Bockius, says the privacy rights outlined in the California Consumer Privacy Act will empower the individual and possibly prompt litigation.

“A provision of the CCPA creates statutory damages for security breaches, and as a result Hirsch expects to witness a spike in California security breach class action suits,” the site reports. “Lawyers may want to consider incorporating a review of a client’s incident response plan into their CCPA prep work, he says.”