EPA Deprives Anti-Natural Gas Crowd of Key Demonization Rallying Point

Dimock, PA

Cross-posted at Forbes.com’s WLF contributor site

Last weekend, opponents of less expensive, cleaner-burning natural gas (and probably any other fossil fuel) marched on Washington. Among the litany of claims made at Saturday’s Stop the Frack Attack, and against hydraulic fracturing in general, “water pollution” is often first and foremost. Unfortunately for the activists, the facts aren’t on their side with this assertion, an inconvenient truth confirmed last week by their beloved Environmental Protection Agency (EPA).”Look what’s happening in Dimock, PA” has been a rallying cry for anti-fracturing forces over the last few years. A scene from the anti-natural gas propaganda film Gasland purported to show a Dimock resident lighting their tap water on fire. Just like scenes of Cleveland’s Cuyahoga River burning in 1969 inspired Congress to pass the Clean Water Act, activists hoped that this image would ignite a national movement against fracturing.

But science has gotten in the way. EPA announced June 25 that extensive testing of Dimock wells revealed that “there are not levels of contaminants present that would require additional action by the Agency.” This confirms earlier EPA and Pennsylvania environmental officials’ tests, whose results were denied and decried by natural gas opponents.

The silence from these activists on EPA’s latest announcement so far has been deafening. No doubt their public media demonization campaign, described so well in a recent Washington Legal Foundation publication (Misinformation Campaign
Targets Hydraulic Fracturing
) will march on. We won’t be surprised if natural gas’s critics dismiss EPA’s test results as flawed or politically motivated, or if they simply ignore this development and keep flacking the water pollution claim.

There’s two things we’ve learned here at WLF from 35 years of being a public interest advocate for free enterprise — anti-business activists are relentless, and they never let facts get in their way.

Courts Split on Legality of Patent Holders’ and Licensees’ Covenants Not to Sue

Guest Commentary

By Lauren Murphree, a 2012 Judge K.K. Legett Fellow at the Washington Legal Foundation and a student at Texas Tech School of Law.

Covenants not to challenge patent validity, often entered into as a means of settling patent disputes, are being called into question in the wake of a new appellate court decision that invalidated such an agreement for the good of “the public interest.” But courts shouldn’t be actively voiding such agreements, at least not without balancing both the (often sophisticated) parties’ voluntary choices to enter into these agreements, and the immeasurable public interest in contract security and confidence.

The U.S. Court of Appeals for the Second Circuit’s unanimous decision in Rates Technology Inc. v. Speakeasy, Inc. creates what appears to be a clear circuit split regarding parties’ ability to challenge the validity of patents after entering into licensing agreements—even when those agreements are structured as covenants not to sue or legal settlements. The Second Circuit relied on the 1969 Supreme Court case Lear v. Adkins, but interpretations of that seminal case have been muddied for decades. As a result, the issue has been teed up nicely for further Supreme Court review.

In 1969, the Supreme Court did away with the doctrine of licensee estoppel in the context of patent licensing, holding that the policy implications surrounding patent validity and “permitting full and free competition in the use of ideas” outweighed any arguments in support of the common law of contracts. While the facts at issue in Lear dealt with a patent license and ongoing royalty payments, the Second Circuit interpreted the decision to require courts to balance intellectual property policy against any contractual provisions and invalidate agreements that would “undermine the public interest.” Idaho Potato Comm’n v. M & M Produce Farm & Sales, 335 F.3d 130, 137 (2d Cir. 2003). The Ninth Circuit has similarly found that an agreement not to contest the validity of a patent was facially void and unenforceable. Massillon-Cleveland-Akron Sign Co. v. Golden State Advertising Co., 444 F.2d 425, 427 (9th Cir. 1971). Continue reading “Courts Split on Legality of Patent Holders’ and Licensees’ Covenants Not to Sue”

What’s Not to “Like”? Plaintiffs’ Lawyers Cash in on Facebook Lawsuit

Plaintiffs’ lawyers have devised a settlement agreement only a beneficiary could love, this time taking Facebook to task for its “Sponsored Stories” program.  We’ve commented on the suit previously here and here.  Of course, plaintiffs’ lawyers should be encouraged to devise settlements that the beneficiaries love–when those beneficiaries are actually the plaintiffs they represent.  But in a bizarre, perplexing, and yet somehow predictable twist, the plaintiffs’ lawyers have managed to devise a settlement that seemingly enriches everyone except the plaintiffs.  Heck, even the trial judge had to recuse herself after it was found that she would receive an indirect benefit from the settlement.

Under Sponsored Stories, Facebook may place your picture alongside an ad that you’ve “liked” or otherwise interacted with on a friend’s page.  Sponsored stories apparently generate more than $1 million in daily revenue for Facebook, and just this week during the company’s first earnings call as a public company, Mark Zuckerberg hailed it as a “success.”  But in Fraley v. Facebook, the plaintiffs allege that the program publicizes their “likes” of advertisers without compensation, and fails to warn them or give them an opportunity to opt out. Continue reading “What’s Not to “Like”? Plaintiffs’ Lawyers Cash in on Facebook Lawsuit”

Finger on the Pulse: From Our Blogroll and Beyond

  • Plaintiffs’ lawyers succeeding at applying ancient (1991) law on robo-calls to text messaging and other modern technologies (Sedgwick Class Action Alert)
  • OSHA wades into the hydraulic fracturing regulatory morass (RegBlog)
  • Oil trade group sues EPA over forcing use of unavailable biofuel (Hill E2 Blog)
  • Fish fraud!: Senators work to criminalize errant origin labeling of seafood (Boston Globe)
  • Will 2012 U.S. Supreme Court ruling on criminal fines have impact on punishment under Foreign Corrupt Practices Act? (FCPA Professor)
  • Patent office moves to implement America Invents Act’s “first-to-file” system (Patently-O)

NYC Soda Portion Ban Crushes a Big Gulp of Freedom

Today an array of interested parties will gather in NYC to attend the Department of Health’s public hearing on Mayor Bloomberg’s proposed ban on “large sugary beverages.”  Mayor Bloomberg has used the past few weeks to harp on the prevalence of and risks associated with obesity–which no one denies.  He’s also compiled a list of celebrity supporters, which he likely feels bolster the validity of his cause.  Many individuals, however, are not so easily swayed and believe that, as WLF suggested in comments filed yesterday with the Board of Health, the legitimacy of any attempt to curb individual liberty lies in the science behind it and the economic and social effects it has.

In our comments, WLF both questions the Board’s authority to enact the proposed ban and argues that such a measure is not a rational means of addressing obesity.  In order to fully evaluate the rationality of this heavy-handed measure–as any law-making body should–the Board must take into consideration the economic and social effects, in addition to the health concerns.  Just yesterday the founder of Honest Tea wrote an op-ed describing the burden the ban would put on the company, whose product contains 35 calories per eight-ounce serving (10 calories above the ban’s quota) and comes in 16.9-ounce bottles–just .9  ounces above the board’s arbitrary 16-ounce limit. Continue reading “NYC Soda Portion Ban Crushes a Big Gulp of Freedom”

Reverse Payment Settlement Agreements Likely Headed for Supreme Court Showdown

Guest Commentary

By Ry Ellison, a 2012 Judge K.K. Legett Fellow at the Washington Legal Foundation and a student at Texas Tech School of Law.

On July 16, 2012, the Third Circuit handed down its decision in In re K-Dur Antitrust Litigation, and in doing so, gave the Federal Trade Commission (“FTC”) its first major victory in its decade-long crusade against so-called “reverse payment” settlements of patent disputes.  Also called pay-for-delay settlements, such agreements involve private settlements wherein the pioneer drug manufacturer provides monetary consideration to the defendant generic manufacturer in exchange for the specific exclusion of competition in the drug market for a finite period of time.

By reinstating the FTC’s lawsuit, the Third Circuit breathed new life into the argument that reverse payment settlements of patent disputes between pioneer and generic drug manufacturers constitute per se violations of antitrust laws.  Of special significance was the court’s explicit acknowledgement that its ruling squarely contradicted the conclusions reached by its sister courts.  Prior to the Third Circuit’s decision, the Second, Eleventh, and Federal Circuits had all issued major decisions upholding the legality of reverse payment settlement agreements.  Accordingly, the Third Circuit’s clear and intentional establishment of a circuit split has laid the foundation for a Supreme Court showdown between the FTC and drug manufacturers.

Continue reading “Reverse Payment Settlement Agreements Likely Headed for Supreme Court Showdown”

The Ninth Circuit Rains on Plaintiffs’ Attorneys’ Class Action Pay Day

Guest Commentary

By Lauren Murphree, a 2012 Judge K.K. Legett Fellow at the Washington Legal Foundation and a student at Texas Tech School of Law.

The Ninth Circuit recently handed down a strongly worded opinion that may signal a positive trend in so-called “consumer protection” class action lawsuits. Judges across the country appear less willing to rubber-stamp large class action settlements, and their adherence to the rule of law should certainly be applauded.

In Dennis v. Kellogg Co., the rejected settlement agreement would have provided $2.75 million for distribution to the class (up to a whopping $15 per member), $5.5 million “worth” of Kellog items to feed the indigent per the cy pres doctrine, $2 million in attorney’s fees, and an agreement to stop advertising that Kellog’s Frosted Mini-Wheats improved attentiveness by nearly 20% (the marketing claim that provoked the lawsuit in the first place) for the next three years. By the court’s calculations, the attorney’s fees amount to a staggering hourly rate of $2,100. While counsel for the class defended those fees in light of the time spent on the case, drafting the settlement, and litigating the appeal, the Ninth Circuit wasn’t buying it: “one reason why those counsel had to defend this appeal is because they negotiated a deficient settlement agreement.”

Continue reading “The Ninth Circuit Rains on Plaintiffs’ Attorneys’ Class Action Pay Day”