Amir Rant: Lawyers!

[amirm]

If you live in US like me, you likely get these notices of settlements of class action suits. These are lawsuits brought by attorneys, who usually specialize purely in this area, that go after big companies to collect money ostensibly on behalf of hurt consumers. In reality, vast majority of them are for the benefit of the law firm, than any injured person. I have filled out the forms a few times and never heard anything. In other cases, I laughed at the prospects of showing for example that I flew on British Airways 10 years ago and had some ability of proving the same! Only to get $5.25 back in refunds.

Even in the cases where we were clearly damaged like the Maytag washer and driers that kept water in them and become smelly as heck, and had to be thrown out together with $2,000 we paid for both even though they were working otherwise, we never heard a thing.

This latest notice of "settlement" however, takes the cake. It was a suit brought against merger/acquisition of Texas Industries Inc and Martin Marietta. First thing that gets me is that this is a full on legal filing. Nothing in it reads remotely like a consumer notice. If you don't have significant experience reading legal papers, you would not have a clue what it is. It is some 10 pages long which I suspect is is intentional to cover up the preposterous nature of it:

1. There is zero, let me repeat, there is zero money being given to any "injured" clients. No money whatsoever!

2. A simple filing by the companies being sued with the SEC.

3. $360,000 for the attorneys who brought the suit!!!!

Yup, they settled for their own money and that was that. The justification was that they took "risks" for bringing this suit so they should be rewarded not only for their true expenses but some profit. Are you kidding me? Since when the legal system was an investment as to reward risks? And since when you are to be applauded for taking the "risks" while proposing that your client get nothing???

Likely they realized their suit was frivolous and were happy to get nice mark up of what they put in. And the companies being sued were happy to pay it since even if they won, they would have incurred far more fees than this amount.

No economic value was created sans whoever is getting paid to print and mail these notices. We all funded the judges and legal system so that this law firm could get this sort of money to go and sue more companies like this.

I much rather if lawyers are just going to take care of themselves that they do so without telling us. To think that they should write a 10 page notice to send to me just adds insult to injury. Yeh, I supposedly have the right to "opt out" of this settlement. The only bigger joke is me or someone else who gets this notice wanting to do that. A kabuki theater if there ever was one. Why not give me the right to sue this law firm if I can show that they looked out for their best interest rather than me as the client? Now that would make things interesting.

 

[DaveyF]

Amir, I like your RANT!!
The legal system, like so many other " societal systems", is so broken- in so many ways, all one can say is: FUBAR!
I couldn't agree with you more when you say that "if lawyers are just going to take care of themselves that they do so without telling us".
The whole protocol relating to the " settlement of class action suits" is IMHO an utter disgrace. How many times have we been "advised" by mail that one of the companies that we have either a) invested in ( stocks or bonds) b) Acquired merchandise from ( in my case the Bosch washer and dryer with similar mold issues to your Maytag) or c) some company has been accused of "price fixing and collusion"- has been sued. The "settlement" is now proposed and naturally includes a hefty fee to all attorney's involved and an utter pittance to the majority of the "class". That pittance award is predicated on the majority of the "class" being able to prove essentially the impossible!
Like I said before...FUBAR and an utter disgrace across the board....All IMHO

Davey's rant over

 

[Johnny Vinyl]

A clear case of big business (law firms in this case) manipulating the system for their own benefit. It's all about lining one's own pocket.

 

[edorr]

A clear case of big business (law firms in this case) manipulating the system for their own benefit. It's all about lining one's own pocket.

The real scum of the earth are divorce lawyers. Don't get me started.

 

[Johnny Vinyl]

The real scum of the earth are divorce lawyers. Don't get me started.

I hear ya!

 

[edorr]

I hear ya!

I have never been divorced so never been taken to the cleaners, but seen more than a few incidents of borderline criminal fraud/extortion/malpractice by divorce lawyers. The scam always follows the same pattern, so this is probably established best practice in the profession.

 

[GaryProtein]

. . . In reality, vast majority of them are for the benefit of the law firm, than any injured person. I have filled out the forms a few times and never heard anything. In other cases, I laughed at the prospects of showing for example that I flew on British Airways 10 years ago and had some ability of proving the same! Only to get $5.25 back in refunds. . . .


1. There is zero, let me repeat, there is zero money being given to any "injured" clients. No money whatsoever!

2. A simple filing by the companies being sued with the SEC.

3. $360,000 for the attorneys who brought the suit!!!!

Yup, they settled for their own money and that was that. The justification was that they took "risks" for bringing this suit so they should be rewarded not only for their true expenses but some profit. Are you kidding me? Since when the legal system was an investment as to reward risks? And since when you are to be applauded for taking the "risks" while proposing that your client get nothing???

Likely they realized their suit was frivolous and were happy to get nice mark up of what they put in. And the companies being sued were happy to pay it since even if they won, they would have incurred far more fees than this amount. . . .

Almost all those suits are frivolous being brought by the liars, I mean lawyers. They make a fortune and the people make zilch. Just look at the xaralto/pradaxa and other recent drug suits. These drugs are actively on the market, advertized and prescribed. The lawyers know they are the only ones who will reap benefit from the suit. It is very rare that any of the people in the class action suit will get anything that will in any way compensate them for finding the proof they deserve any compensation. The last case I can recall where the plaintiffs got anything substantial was the AH Robins IUD suit in the 1980's. Maybe Steve knows more about this.

 

[ack]

There is more... during merges and acquisitions, lawyers will typically sue either party (or both) claiming that the merger/acquisition hurts the investors. When either party is a publicly traded company, the stock usually plunges on the news that it's been sued. But guess who's bought shares of the defendant high in order to sell short, before suing??? The same lawyers. And they will gladly also settle with the defendants before it even goes to trial.

 

[Phelonious Ponk]

We need tort reform in this country, no question. What we don't need, however, is what the most vocal advocates of tort reform call for -- awards ceilings and worse, corporate amnesty from litigation in some cases. We already have a situation in this country in which companies often cause great damage to people, communities, the environment, and the competition that makes markets work, but end up paying far less for their crimes than they profited from them. In such an environment, endangering other people's lives becomes a calculated business risk, not a criminal activity with an unthinkable potential cost to the perpetrators.

Yes, we need tort reform that would eliminate the kind of pointless, self-serving litigation Amir is talking about here while, at the same time, making the cost of destroying lives and communities for profit so high that it ends with the guys from the C suite doing the perp walk on the evening news. Unfortunately, that would require the politicians on both sides of the issue working together for the greater good instead of for the benefit of the litigators or corporations with the deepest pockets. And if we ever really had it, we have completely lost the ability to do that in this country. It's not just the legal system that's broken, it's the political system that makes the laws.

Tim

 

[still-one]

Tort reform from Congress???? About 50% of them are/were lawyers.

 

[Asamel]

Grrrrrrrrrrrrrrrrr

 

[DaveyF]

We need tort reform in this country, no question. What we don't need, however, is what the most vocal advocates of tort reform call for -- awards ceilings and worse, corporate amnesty from litigation in some cases. We already have a situation in this country in which companies often cause great damage to people, communities, the environment, and the competition that makes markets work, but end up paying far less for their crimes than they profited from them. In such an environment, endangering other people's lives becomes a calculated business risk, not a criminal activity with an unthinkable potential cost to the perpetrators.

Yes, we need tort reform that would eliminate the kind of pointless, self-serving litigation Amir is talking about here while, at the same time, making the cost of destroying lives and communities for profit so high that it ends with the guys from the C suite doing the perp walk on the evening news. Unfortunately, that would require the politicians on both sides of the issue working together for the greater good instead of for the benefit of the litigators or corporations with the deepest pockets. And if we ever really had it, we have completely lost the ability to do that in this country. It's not just the legal system that's broken, it's the political system that makes the laws.

Tim

+1000

 

[Phelonious Ponk]

Tort reform from Congress???? About 50% of them are/were lawyers.

Ahhh...there's the rub. And I suspect it's a lot more than 50%.

Tim

 

[jazdoc]

As Madison predicted in Federalist #62

Another effect of public instability is the unreasonable advantage it gives to the sagacious, the enterprising, and the moneyed few over the industrious and uniformed mass of the people. Every new regulation concerning commerce or revenue, or in any way affecting the value of the different species of property, presents a new harvest to those who watch the change, and can trace its consequences; a harvest, reared not by themselves, but by the toils and cares of the great body of their fellow-citizens. This is a state of things in which it may be said with some truth that laws are made for the few, not for the many.

Class action lawsuits such as the one in the OP are a feature, not a bug of a large adminstrative state. The Federal Register approaches 100,000 pages, complex legislation of over 1,000 pages is passed unread because it is unreadable and reams of regulations are promulgated by a vast army of bureacrats who do not answer to the public. To expect a more benign outcome is an act of cognitive dissonance.

 

[still-one]

Ahhh...there's the rub. And I suspect it's a lot more than 50%.

Tim

As has been true in recent Congresses, the vast majority of Members (93% of House Members and 99% of Senators) at the beginning of the 113th Congress hold bachelor’s degrees. The CQ Roll Call Member Profiles at the beginning of the 113th Congress indicate the following:
• 21 Members of the House and 1 Senator have no educational degree beyond a high school diploma;
• 7 Members of the House, but no Senators, have associate’s degrees as their highest degree, and 1 House Member has an L.P.N. (nursing) degree;
• 85 members of the House and 14 Senators earned a master’s degree as their highest education degree;
• Law degrees are held by 169 Members of the House (38% of the House) and 57 Senators (57% of the Senate);
• Of the Members holding a law degree, 4 (3 House Members and 1 Senator) also hold an LL.M. (Master of Laws) degree;
• 20 Representatives (but no Senators) have doctoral (Ph.D. or D.Phil.) degrees; and
• 22 Members of the House and 3 Senators have a medical degree.15

 

[amirm]

We need tort reform in this country, no question. What we don't need, however, is what the most vocal advocates of tort reform call for -- awards ceilings and worse, corporate amnesty from litigation in some cases. We already have a situation in this country in which companies often cause great damage to people, communities, the environment, and the competition that makes markets work, but end up paying far less for their crimes than they profited from them. In such an environment, endangering other people's lives becomes a calculated business risk, not a criminal activity with an unthinkable potential cost to the perpetrators.

Criminal indeed. Heard this one on the radio yesterday:

"The U.S. Department of Justice (“DOJ”) is seeking to reach a settlement in the foreign currency (“FX”) rigging probe with five major global banks. The settlement would involve a guilty plea from all 5 banks – Citigroup Inc. (C - Analyst Report), JPMorgan Chase & Co. (JPM - Analyst Report), Barclays Plc, Royal Bank of Scotland Group Plc and UBS Group AG."


The kicker was this:

"Further, the banks demand assertion from the Securities and Exchanges Commission (“SEC”) and other federal regulators that following the plea, they should not be barred from conducting certain businesses as criminal pleas generally lead to such consequences."

The radio version said it was "routine" for SEC to grant such waivers!!!

 

[DaveyF]

Amir, as one of my clients famously said...."when I come back, i want to come back as a bank"!

 

[Don Hills]

Gotta hand it to the USA... you have the finest legal system that money can buy.

 

[amirm]

I would be remiss if I did not say that I have great respect for good lawyers. I call them "good" when they think and work strategically to make good business decision. They are logical, organized, detailed oriented and thoughtful. So this thread is not remotely a slam on the profession.

 

[amirm]

Gotta hand it to the USA... you have the finest legal system that money can buy.

Yeh but we don't force them to wear a wig: