Federal Court Offers an Exemplar on Defusing the E-Discovery Litigation Weapon

quickenAny civil litigation target knows that the highest costs of defending a lawsuit arise not from the courtroom or motion work, but from discovery.  Those costs have paradoxically skyrocketed in the digital era.  Though computers made it faster and cheaper to find and disclose documents, the volume of discoverable documents has infinitely increased, inspiring overwhelming production requests that courts must weigh when issuing discovery orders.

As outlined in a WLF Legal Backgrounder, those burgeoning electronic discovery (or e-discovery) demands inspired the U.S. Judicial Conference to amend the Federal Rules of Civil Procedure in 2015.  Among other changes, the amendments altered the scope of discovery under Rule 26 by imposing a stricter proportionality test for e-discovery.  Continue reading “Federal Court Offers an Exemplar on Defusing the E-Discovery Litigation Weapon”

Settlement of Lawyer-Driven “Merger Tax” Litigation Stumbles in New York

ny state courtsTo paraphrase an Oscar-winning song, it’s hard out there for a corporate merger.  In recent years, opportunistic plaintiffs’ attorneys have descended upon proposed mergers of publicly owned companies, filing lawsuits to delay the proceedings alleging that management breached its fiduciary duty to the shareholders.

But one look at the typical settlement demonstrates that these cases are almost always cash grabs for the attorneys while providing almost no benefit for the allegedly harmed shareholders.  The defendant usually agrees to “disclose” additional, trivial information about the merger, while paying the plaintiffs’ attorneys thousands of dollars in legal fees.  It comes as little surprise that these claims are colloquially known as “merger tax” suits, with the “tax” being the attorneys’ fees public corporations now feel obligated to pay any time they want to combine. Continue reading “Settlement of Lawyer-Driven “Merger Tax” Litigation Stumbles in New York”

DOJ Memo and Court Opinion Show Trend in Damming Flood of False Claims Act Suits

11th CircuitBusinesses that routinely contract with the government know that while the relationship comes with high financial rewards, it also can expose those companies to massive civil liability.  Under the False Claims Act (FCA), government contractors can find themselves sued for hundreds of millions of dollars based on mere technical violations of complex regulatory schemes.

Luckily, as highlighted in several of our previous posts, the U.S. Supreme Court has recently reinforced the high evidentiary threshold FCA plaintiffs need to meet to bring a successful claim under the most common theory of FCA liability.  A recently disclosed U.S. Department of Justice (DOJ) memo and a recent opinion from the U.S. Court of Appeals for the Eleventh Circuit might similarly lead to fewer baseless claims against government contractors. Continue reading “DOJ Memo and Court Opinion Show Trend in Damming Flood of False Claims Act Suits”

Same-Old Drug Advertising Ban Proposal Would Fail for the Same-Old Reasons

first-amendmentAs the country debates the best path forward for the nation’s healthcare system, interest groups continue to advance different ideas to address their pet causes.  One popular cause is the reduction of drug prices.  Though that debate often occurs based on narrow perceptions of the dollar figures at issue, ideas for price reduction are worthy of consideration, especially given the increasing budgetary percentage that government and personal spending healthcare now occupies.  One drug-price-reduction idea advanced toward the end of last year, however, should be vigorously opposed. Continue reading “Same-Old Drug Advertising Ban Proposal Would Fail for the Same-Old Reasons”

A River Runs to Court: Environmental Activists Circumvent Democracy to Impose Agenda

colorado river gorgeThis is a frustrating time for environmental special-interest activists. Their cause is not one the public rates as a national priority. Their allies are no longer in leadership positions in federal agencies. And though they still have friends at the state and local levels, shrinking budgets prevent those regulators and elected officials from pursuing the activists’ agenda. With waning influence in other branches, many environmental organizations now increasingly look to a long-standing and reliable tool of advocacy—the lawsuit—to achieve their ends.

Some groups have gone well beyond such traditional environmental litigation as citizen suits under state or federal laws, and are instead seeking judicial injunctions that would force government regulators to implement activists’ preferred policies. These lawsuits suffer from a number of infirmities, not the least of which is they turn the entire democratic process on its head. Continue reading “A River Runs to Court: Environmental Activists Circumvent Democracy to Impose Agenda”

Federal Courts, State Governments Push Back Against Corrosive Disabilities Act Suits

sharkCongress passed the Americans with Disabilities Act (ADA) in 1990 to provide important protections for some of the most vulnerable Americans.  Like other federal anti-discrimination laws, the ADA included a private right of action.  And as has happened with many other laws that can be privately enforced, the ADA has seen its share of questionable lawsuits during its nearly three-decade history.

In recent years, the trickle of lawsuits has grown into a flood, with scores of actions alleging what are at best novel interpretations of the law and at worst blatantly baseless “drive-by” claims that seek a quick buck.  Thankfully, courts are increasingly skeptical of plaintiffs’ lawyers’ attempts to broaden the ADA, and elected officials in some states are pushing back against legal shakedowns of small businesses. Continue reading “Federal Courts, State Governments Push Back Against Corrosive Disabilities Act Suits”

Drunk Suing, Another Round: Court Allows False-Labeling Claim on “Hawaiian Beer” to Proceed

indexWe have been covering a legal action against Kona Brewing Company (now renamed Broomfield v. Craft Brew Alliance), which is one suit in the larger trend of class actions against breweries alleging misleading or false labeling and advertising.  In that suit, Judge Beth Labson Freeman, who sits on the U.S. District Court for the Northern District of California (a.k.a. the “Food Court”), recently ruled on Kona’s motion to dismiss.

Though the court trimmed the complaint, dismissing several of the plaintiffs’ causes-of-action and requests for relief, it held that the crux of the allegations could proceed.  The result is that, through strategic pleading, Kona must spend its time and resources fighting a lawsuit with questionable merits.  Judge Freeman created perverse incentives for future litigants by choosing to become, in essence, a product-packaging regulator. Continue reading “Drunk Suing, Another Round: Court Allows False-Labeling Claim on “Hawaiian Beer” to Proceed”