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Page 2 / LAWYERS USA June 2011 / 2011 LUSA 150Missouri Governor Jay Nixon hassigned into law a bill which attempts torein in suits against operations such ashog farms.The bill, sparked by a series of jury verdictsagainst large hog farm operations,restricts the potential damages in an actionfor private nuisance involving farming,agriculture or animal production.Last year, several families in northernMissouri won $11 million at trial. A similarcase in 2006 ended in a $4.5 millionverdict, and a jury recently returned nearly$2 million in damages against a hogfarm operation. Each suit claimed thatthe odor and flies from those operationshad ruined neighbors’ quality of life.Charles Speer, of the Speer Law Firmin Kansas City, Mo., led each of thosesuits and has conducted hundreds of similar nuisance actionsthroughout the state. Speer did not return a call or e-mail seekingcomment.The Missouri Association of Trial Attorneys, which testifiedagainst the bill, declined to comment, executive director SaraSchuett said.The bill won the backing of the state’s corn growers’, cattlemen’s,pork, agribusiness, soybean growers’ and county commissioners’associations.In an -emailed statement, Holly Boxley, a spokeswoman forPremium Standard Farms, a corporate hog farm in northernTort reform bill closer tobecoming law in TennesseeA tort reform bill that would restrict personalinjury lawsuits, including capping noneconomicdamages at $750,000, has passedthe Tennessee house of representatives.The state senate passed a version of thebill in April. The measure was proposed byGov. Bill Haslam.House Bill 2008, named the TennesseeCivil Justice Act of 2011, caps pain and suffering,loss of enjoyment and other non-economicdamages at $750,000 in most cases.The cap would be raised to $1 million in certainnarrowly defined catastrophic cases.The bill also requires a plaintiff to proveby a “clear and convincing” evidence standardthat the defendant acted maliciously,recklessly, intentionally or fraudulently in orderto receive a punitive damages award. Itcaps punitives at $500,000 or double the compensatorydamages, whichever is greater.Republicans, who voted unanimously forthe bill, argued it would help attract businessto the state, while Democrats, whovoted against it with the exception of eightrepresentatives, argued the caps wouldhurt injured victims and violate the right toa jury trial.A number of Democratic amendmentsaimed at raising the caps or amelioratingthem were tabled.– Sylvia HsiehBPA ban advancesin Calif. legislatureThe California State Assembly has passeda bill that seeks to effectively ban the toxicchemical bisphenol-A (BPA) from baby bottles,sippy cups and other products intendedfor young children.The Toxin-Free Infants and Toddlers Actwould prohibit the manufacture, sale or distributionof certain children’s products thatcontain BPA at a level above 0.1 parts perbillion.The bill, if passed by the state senate andsigned by the governor, would go into effectJuly 1, 2013, and apply to any bottle, cup,USA BRIEFSNew Mo. law willrestrict hog farm suitsformula, liquid, beverage or food intendedto be used by children age 3 and under.Assembly member Betsy Butler, a co-authorof the bill, said that she is “verypleased” that the measure can proceed tothe state senate for consideration.“The science on BPA shows cause foralarm and it’s a shame that we have failedto protect our most vulnerable citizensfrom this toxic chemical,” Butler told TheCalifornia Newswire.Plaintiffs in a number of lawsuits acrossthe country have cited medical studies suggestinga link between exposure to BPA anda wide range of health problems, includingcancer, diabetes, hyperactivity, miscarriageand heart disease.In 2010, the Environmental ProtectionAgency added BPA to its list of “chemicalsof concern.”Legislators and advocates in 30 stateshave introduced bills aimed at banning anumber of chemicals commonly found inconsumer products, including BPA.– Pat MurphyMich. court issuesnew solicitation ruleLawyers in Michigan will have to markany letter sent to solicit representation ofa prospective client as advertising materialunder a new ethics rule enacted by theMichigan Supreme Court.The rule also forbids the sending of suchletters until “30 days after the injury, deathor accident occurred that has given rise tothe action of potential claim.”Some critics, including state supremecourt Justice Stephen J. Markman, say thenew rule, MRPC 7.3, will benefit large firmsat the expense of smaller firms that relyupon direct contact solicitation.“The upshot is that those lawyers, andlaw firms, which engage in client solicitationby the hundreds of thousands will continueto engage in business as usual, whilethose lawyers, and law firms, which engagein client solicitation one person at a timewill become more heavily regulated,” Markmanwrote in a dissent to the amendmentAP Photo/Charlie NeibergallMissouri that has been the subject of much litigation, said thebill strikes the right balance.“This is a much-needed law that protects our state’s agriculturalproducers from being forced out of business by multiplenuisance lawsuits, and at the same time preserves theright of individuals to seek legal redress from farming operations,”she said.The new law will go into effect Aug. 28.– Scott LauckA version of this article originally appeared in Missouri LawyersWeekly, a sister publication of Lawyers USA.order. “Further, the latter group will be prohibitedduring a 30-day period from solicitingbusiness from certain categories of potentialclients, while the former group willbe allowed to continue soliciting such businessduring the same period.”Justices Marilyn Kelly and Diane M. Hathawayalso dissented. Kelly said she supportedusing the American Bar Associationmodel rule, which simply requires thatsuch communication, whether written,recorded or electronic, contain the words“advertising material,” and doesn’t includea 30-day rule.Hathaway simply wrote that she “woulddecline to adopt.”The rule will go into effect on Sept. 1,2011.– Brian FrasierA version of this article originally appearedin Michigan Lawyers Weekly, a sisterpublication of Lawyers USA.Report: Chantix risksunderestimatedA product liability watchdog claimsthat the risks of Pfizer’s quit-smokingdrug Chantix have been underestimatedin the latest reporting by the Food andDrug Administration.“[U]ntil July 2010 FDA safety analystswere not aware of more than half of the reportedsuicide cases in which [Chantix]was the primary suspect drug, and did nothave available hundreds of other reportedcases of serious psychiatric side effects,”the Institute for Safe Medication Practicessaid in a recent report.The report analyzes adverse events reportedto the FDA in the third quarter of2010 for Chantix, as well as other drugs thatare subject to product liability claims.Chantix has been prescribed to hundredsof thousands of smokers since Pfizerintroduced it in August 2006. Morethan 100 lawsuits alleging that Chantixcaused suicides or attempted suicideshave been consolidated in federal courtin Alabama.The institute alleges in its report thatWhat’s on yourdesk?HeathEskalyoEskalyo is ashareholder atKelley Kronenbergin FortLauderdale,Fla. He specializesin workers’ compensationdefense and OSHA cases.• My office is themed around thesport of triathalons, and I often docharitable fundraising through thesport with clients and my firm.• I have a photoof myself withmy family afterI crossedthe finish lineof the FloridaIron Man competition, which wasmy ultimate goal race. It shows ayear of commitment to trainingwith the support of my family.• I have three glasscylinders that havethe initials S.B.R.,which stands forSwim, Bike, Run.People tend to figureit out once theylook around theoffice.• My businesscardholder ismade outof a bicyclechain.• A mouse pad with the Iron ManCorp. logo.• Incorporated into the paint of mywall, I have two quotes. One says,“Anything is possible,” and theother is “I believe in me.” That’ssomething we have always tried toinstill in our kids, that they can doanything they set their minds to.• On one wall is a huge picture of aprofessional triathelete coming outof the ocean. I also have a waterbottle hanging up with bike spokescoming out of it instead of flowers.Pfizer failed to send through the usual FDAchannels reports of hundreds of seriouspsychiatric adverse events related to Chantix,most notably 150 cases of completedsuicides, some dating back to 2007.“New data from the third quarter showthat the risks of serious psychiatric side effectswere previously underestimated becauseso many of these events were notpromptly reported, and were thereforeomitted from the FDA’s safety analysis,” theinstitute said in its report. “We believe thisContinued on page 27
2011 LUSA 151 / June 2011 Lawyers USA / Page 3IN THE NEWSRuling makes fuzzy ERISA law more puzzlingBy Kimberly AtkinsStaff writerWASHINGTON – Lawyers who litigateemployment benefits cases were waitingfor the U.S. Supreme Court to answer oneimportant question: whether beneficiariesclaiming they were misled by a summaryplan description must prove detrimental reliancein an action under the Employee RetirementIncome Security Act.But in a move that seemed to surprise attorneysrepresenting both beneficiaries andplan administrators, the Court insteadmade a number of holdings regarding boththe administration and litigation of employmentbenefits, causing both sides toclaim a partial victory, and just about everyoneto express at least a bit of confusion.“This is one of those bad-facts-make-badlawcases, because the underlying case isso complicated that [the Court] wasn’t ableto decide a simple issue” like detrimentalreliance, said Stephen Rosenberg, a partnerat the McCormack Firm in Boston, where heheads the firm’s ERISA practice group.In CIGNA Corp. v. Amara, the Court unanimouslyheld that courts cannot, as the districtcourt did in this case, reform a benefitsplan under §502(a)(1)(B) of ERISA to complywith the more beneficial terms of a summaryplan description (SPD). (Justice SoniaSotomayor took no part in the decision.)The Court also held that the summaryplan description, which here led employeesto believe that they would get greaterbenefits that they received, was not part ofthe plan and could not itself be enforced bythe court under that section of the Act.But in a surprise move, the Court alsoheld by a 6-2 vote that plan beneficiariescould seek monetary relief under §502(a)(3),which provides for equitable relief for ERISAviolations. A showing of detrimental relianceis not necessary to prevail on such aclaim, just simple causation, the Court’s majorityheld.Almost immediately plaintiffs’ employmentlawyers claimed victory, arguing thatthe expansion of the equitable relief sectionof the law gave beneficiaries a new avenueof relief for ERISA violations.“It’s a big win,” said San Francisco plaintiffs’attorney Joseph A. Creitz, whose practiceincludes ERISA litigation. “The Courtexplicitly said that the equitable remedy isavailable [for beneficiaries] to recover outof-pocketcosts. That is a big change.”But lawyers defending benefit plans werenot sure the victory was so one-sided. TheCourt’s ruling went against the plaintiffs inAmara, they pointed out. And the standardsunder the ERISA section governing equitablerelief are so spongy, they said, that the plaintiffsin Amara and other cases probably haveyears of litigation ahead of them, and the issueof the proper equitable standards couldwind up back before the Supreme Court.“[The justices] didn’t really deal with that.They just sent it back down,” said Rosenberg,who represents plan administrators inERISA litigation. “Is the district court just goingto reform the plan under the equitableclause? Is the 2nd Circuit going to upholdthat? There is a big question as to whetherthis is good for the beneficiaries or not becauseof the [litigation] that lies ahead.”Also, the holding that summary descriptionsare not a part of benefits plansis a win for employers and plan administrators,their lawyers say.“It does confirm what we always [believed],which is that the SPD is differentfrom the plan instrument,” Rosenberg said.‘Surcharge,’ other equitable remediesBefore the decision in Amara, courts generallyheld that monetary relief was notavailable under the equitable remedies provisionof ERISA.But the Court’s majority – reaching backto cite equitable principles applied to trustscases, some more than a century old –found otherwise. In equity, the Court held,courts could offer several types of relief: injunctiverelief, reformation of the plan,estoppel and an award called a “surcharge.”“Equity courts possessed the power toprovide relief in the form of monetary ‘compensation’for a loss resulting from a trustee’sbreach of duty, or to prevent the trustee’s unjustenrichment,” Justice Stephen Breyerwrote. “Indeed, prior to the merger of law andequity this kind of monetary remedy againsta trustee, sometimes called a ‘surcharge,’was ‘exclusively equitable.’”That ruling represents a turnaround inSupreme Court ERISA precedent, whichPaul W. Mollica, of counsel to Outten &Golden in Chicago, said has been increasinglyadverse to beneficiaries seeking relief.There had been a series of “decisionsfrom the Supreme Court that [gave] fewerand fewer remedies for ERISA violationsthat could result in any kind of relief,” saidMollica, who represents plaintiffs in class,collective and public interest litigation.“What the decision does is refashion the [liabilityto allow] relief against fiduciaries forsuch statements, and that relief can take theform of monetary relief. That is a significantchange in the way the Court has ruled.”And while the holding that summaryplan descriptions are not part of the planis “a technical win” for employers andplan administrators, it’s a limited one,Mollica said.Overall, the result of Amara, he said, willbe “more wins for participants.”“I think it will lead lawyers who [litigate]ERISA to give more optimistic predictionsto their clients,” Mollica said. “The fact ofthe matter is, [with] a lot of people whocome into the office with ERISA claims, youare disappointing them. And now I feelmore confident. Now we have claims thatwe can make that we didn’t have last week.”One thing is certain, Rosenberg said.Lawyers on both sides will try to use Amara,and all other ERISA precedent, the bestway that they can.“ERISA can be manipulated,” Rosenbergsaid. “In most cases ERISA litigators can manipulateit in a bunch of different directions.As a plaintiffs’ lawyer you know how to [usea case] to support your claim for relief, andas a defense lawyer you know how to saythat those issues have not been resolvedby the courts.”Questions or comments can be directed to thewriter at: kimberly.atkins@lawyersusaonline.com
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