The Intersection Among Torts, Science, Corporate Law, Insurance & Bankruptcy

Morrison v. Berry – Delaware Supreme Court Rules On Disclosure of the Reasons Behind a Corporate Board Action For Which Business Judgment Deference is Sought

Posted in Delaware Law, Fraudulent Conveyance

It’s certainly been interesting to watch the last several years of opinions from the Delaware Supreme Court. A July 2018 opinion adds to the list of interesting opinions because it limits the circumstances under which business judgment deference will be allowed. The opinion is Elizabeth Morrison v. Ray Berry et. al., which was first issued on July 9, 2018, and then revised on July 27. The opinion is drawing ample commentary from corporate lawyers and litigators. For example, the comments below are the introduction to a commentary from Cooley on August 7, 2018. Also tote the emphasis of the authors regarding the burden of proof:

“In Elizabeth Morrison v. Ray Berry et. al., (dated July 9, 2018), the Delaware Supreme Court reversed the Delaware Chancery Court’s dismissal of deal litigation based on obtaining a cleansing vote under Corwin/Volcano because the defendants failed to show “as required under Corwin” that the vote was fully informed. The deal litigation arose from the sale of The Fresh Market to a private equity buyer through a cash tender offer that involved The Fresh Market’s founder and his son, who owned collectively 9.8% of The Fresh Market shares, rolling over their equity. The plaintiffs contend that the founder and his son teamed up with the private equity buyer to purchase The Fresh Market at a discount by inducing the board to run a process that gave the private equity buyer an improper bidding advantage. The plaintiffs used a Delaware General Corporation Law Section 220 books-and-records demand and then Section 220 litigation to seek and obtain board minutes and emails with the founder’s counsel that the plaintiffs then used as evidence in the post-closing fiduciary duty case. The Delaware Supreme Court found that a reasonable stockholder would find the following information that was not included in the Schedule 14D-9 to be material, and therefore, the tender was not fully informed and the business judgment rule was not invoked:”


How much disclosure of deal dirty laundry is necessary in order to fully inform a Corwin/Volcano cleansing vote?

In Federal Court, When Is An Affidavit A Declaration Even if Not Notarized?

Posted in Evidence

Time and again,  litigators experience hassles with a witness obtaining notarization of a signature. That sometimes leads to submission of affidavits that are technically not proper, and related angst. But is such an affidavit a declaration under penalty of perjury, if the “penalty of perjury” language is used?  Yes, said an Illinois federal court  See Snyder v. Wal-Mart Stores, No. 18 C 583 (April 2, 2018). Hat tip to Steven Garmisa for flagging the case in a July 16, 2018 article in the Chicago Daily Law Bulletin (paywall).

Two Plaintiff Experts Stricken as Karmeier/State Farm Trials Approach

Posted in Litigation Industry

September and October 2018 trials are approaching for federal court litigation regarding State Farm’s 2004 contributions used for messaging said to be related to the campaign for office of Justice Karmeier of the Illinois Supreme Court. In a recent ruling, the district judge (Herndon) struck two of plaintiff’s expert opinions related to the contributions. The ruling is summarized in a July 24, 2018 article at the Madison County Record.

Polluting the Arbitration Pool for All – Fitbit and MoFo Take a Meaningful Hit for Bad Faith Related to AAA Arbitration of Consumer Claims

Posted in Uncategorized

One litigation industry industry problem is that foolish actions by one litigant can harm many other similarly situated litigants. This reality arises for parties on either side of the versus.

A new example from the corporate defense side arises from the “bad faith” actions of Fitbit and MoFo (Morrison & Foerster) related to a consumer fraud arbitration. In short, Fitbit forced a would be class action into arbitration but then refused to arbitrate, after sending the plaintiff an amount it viewed as “resolving the case.”  Plaintiff, however, would not take the money, and went back to federal court for relief. Ultimately, a federal judge issued an opinion strongly rapping Fitbit and MoFo for bad faith, ordered the payment of fees and costs, and also ordered Fitbit to submit his opinion to the parties in all motion to compel arbitration cases arising in the next year. The longer story is in an August 2, 2018 article at Northern California Record. The slip opinion, McLellan v. Fitbit,  is online, and is from Judge Donato of the Northern District of California. Set out below are key excerpts from the opinion, at 1-2, and 10″

“Fitbit would like to treat this incident as a misunderstanding, but it is much more than that. It moved McLellan’s claims out of court and then undertook a course of conduct intended to shut her out of arbitration as well. It abandoned that plan at an early stage only because McLellan was diligent in sounding the alarm, and the Court expressed its concerns in plain terms at the hearing. Fitbit’s conduct has multiplied the proceedings in this case for no good reason and at the expense of plaintiffs’ and the Court’s resources. It has also bolstered the perception that arbitration is where consumer lawsuits go to die. While the merits of that view can be debated, it’s no surprise that many people, including judges, are skeptical about arbitration agreements in light of situations like this one. Fitbit’s conduct undermines the public’s confidence in getting a fair shake when arbitration is compelled.

McLellan has asked to be relieved of her arbitration agreement, and more broadly to strike down Fitbit’s arbitration clause for all users. Although there is some equitable appeal in those requests, the record here does not support terminating the arbitration. Nevertheless, the Court finds that Fitbit and its counsel engaged in bad-faith tactics that warrant corrective action.” 


“To help ensure that Fitbit does not again impose “pointless and wasteful burden[s] on the supposedly summary and speedy procedures prescribed by the Arbitration Act,” Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 27 (1983), it is ordered to file a copy of this decision in all cases where it seeks to compel arbitration under its Terms of Service with consumers. This duty is imposed for a period of one year from the date of this order.”



Free Access to Our Comments Two Years Ago About Ovarian Cancer and Talc Litigation

Posted in Asbestos, Talc Litigation

In September, 2016, multidisciplinary colleagues and I published and sold our second, in-depth and multidisciplinary analysis of the changes to and new directions in asbestos litigation.  The paper was anchored around law and science innovations, and implications for mass tort claiming. For that effort, I teamed with David Schwartz and other science people at Innovative Science Solutions, and William Wilt, a creative actuary and insurance company analyst who leads a business known as Assured Research.

This month, we are republishing – at no cost – the part of the paper that applies to cancer claims related to talc. Why? Because we were pretty darned prescient and the principles still apply. Our 2016 work included detailed thoughts on the scientific and legal developments, such as risks of more claims involving asbestos and cancers other than mesothelioma. In that context, we specifically focused on the possibilities related to claims involving ovarian cancer and the risks and science argued by litigants regarding use of talcum powder in both in industrial settings and for cosmetic uses. An overall point was that there many more “other cancers” than there are mesotheliomas, and that the numbers of “other cancer” claims could well rise. If the claims rise, defense costs for insurers also will rise due to the volume of claims as well as the costs of coming to grips with new science and related new case law.

For those who want free access to the republished section on talc claiming, please visit this August 1, 2018  post at the Innovative Science blog.

More Mass Tort Defense Moves in Big Law

Posted in Litigation Industry

The “mass tort” litigation industry continues to grow. Back in the 1980s and 1990s, many big law firms disdained “mass tort” defense work. However, these days, many big law firms actively recruit in lawyers for mass tort work. This past week, for example, Dechert recruited a group from Quinn Emanuel a group of almost 20 lawyers (plus staffers), as explained in a July 20, 2018 article at American Lawyer.

Free Online Access to Evidence from Glyphosate Trial (Johnson Case)

Posted in Cancer, Litigation Industry, Mass Tort Issues, Science

For those of us who are junkies for trials involving alleged or actual toxins, there’s a good resource online for the ongoing Johnson trial involving glyphosate/RoundUp.  The plaintiff’s firm for the ongoing Round Up trial  (the Johnson case) seems to be posting pretty much everything online at the firm’s web site; trial exhibits, trial transcripts etc.

Respected Stem Cell Scientists Comment On Possible Social Value of Plaintiff Suits Against Some Stem Cell Clinics

Posted in Litigation Industry, Science

Seldom do I see articles in which scientists comment on litigation, much less comment favorably. But two just popped up. One is a brief, comment type article from a respected, well-published stem cell scientist who has been following to some degree lawsuits filed against some “stem cell clinics.”  More specifically, “Dr. Paul Knoepfler (@pknoepfler) is a biomedical scientist, science writer, advocate, and cancer survivor,” as described at his web site.  His article on the stem cell lawsuits is dated July 24, 2018.  Dr. Knoepfler’s article includes a citation to a 2018, open-access peer reviewed paper on the topic.

Interesting times these days. In my view, both articles are good examples of why society needs more multi-disciplinary thinking instead of only working within our professional silos.