« Law - Lawyers Probed in ‘Pretext’ ID Theft | Main | Ind. Decisions - Upcoming oral arguments this week include the questions of: whether a student's myspace.com postings are protected political speech; whether Indiana's school finance system is unconstitutional »

Sunday, December 09, 2007

Law - Another take on massive suits against lead paint manufacturers

NY Times business columnist Joe Nocera's Saturday column in the NY Times is headed "The Pursuit of Justice, or Money?" Some quotes:

Although lead was outlawed in paint in 1978 — and though many industry players had removed it even earlier than that — the lawsuits began in 1987. These were not, however, Motley Rice lawsuits. Most were product liability suits that claimed the pigment manufacturers knew that lead was dangerous and had therefore knowingly harmed the consumer.

The cases went nowhere, for two primary reasons. First, it was hard to make the case in court that the companies had done anything wrong. Yes, there were “bad documents”— there are always bad documents — but most of them were a half a century old, as the science around lead was emerging in this country. They mainly showed that the Lead Industries Association was less than keen about embracing the emerging consensus about the dangers of lead to small children. But the industry didn’t try to cover up the science, and as the science became clearer in the 1950s, the industry voluntarily took lead out of interior paint. I realize that many people think companies should rush to abandon legal products at the first whiff of a problem, but if that were really the standard, the shelves would be bare.

The second problem is that it was impossible to know which manufacturer’s paint had been used on a particular house. For most judges, that was the real deal-breaker. For as long as there has been product liability law, it has been rooted in the notion that in order to sue a wrongdoer, you have to know who the wrongdoer is. Plaintiffs’ lawyers tried to argue that since all the manufacturers used lead pigment, they were all guilty — and their guilt should be proportional to their market share. But aside from Wisconsin, this was universally rejected by the courts.

And there things stood until Motley Rice arrived on the scene. In Rhode Island, where Motley Rice has an office — and lots of political ties — the firm agreed to join forces with the attorney general’s office, just as it had in the tobacco case, and take 16.7 percent of the proceeds if its side won. A lawyer named Fidelma Fitzpatrick came up with the most novel theory yet: the state should sue the companies on the ground that lead paint was a “public nuisance.” It was so far-fetched that another lawyer in the office would later tell a reporter that, at first, they called it Fidelma’s Wacky Idea.

Ms. Fitzpatrick explained to me that since the substance was still so prevalent, it was a public nuisance and therefore all the companies were guilty of creating that nuisance. See how easy that was? Suddenly, the case was no longer about an individual who had been harmed by lead — or an absentee landlord who hadn’t maintained his property. It was about those dastardly pigment makers who had put lead in paint.

Armed with this new theory, Motley Rice went to trial in Rhode Island in 2002. Hung jury. Then, in 2006, the case was retried — and Motley Rice won. “Evidence?” laughed Jane Genova, a blogger who has followed the case closely. “There was no evidence. The judge’s instructions said you didn’t need evidence.” If the jurors found that lead paint created a public nuisance, then they should find for the plaintiffs. Sure enough, they did. (It didn’t help that the companies didn’t put on a defense, so sure were they of victory.)

In the last year, it’s gotten even worse for the defendants, at least in Rhode Island. The state, with the help of its friends at Motley Rice, recently unveiled an abatement plan that would require the companies to pay for the inspection of a staggering 240,000 homes as well as thousands of other structures like hospitals and day care centers, and remove lead from most of them. The estimated cost for doing this — almost surely understated — is $2.4 billion, with a hefty chunk of that going to the lawyers, of course. Never mind that for the vast majority of homes, the far better and cheaper solution is simply to keep them maintained. Or that this plan has been ginned up even though the case is still on appeal.

Meanwhile, to capitalize on its success in Rhode Island, Motley Rice and other big-time plaintiffs’ lawyers have raced all over the country, trying to get other jurisdictions interested in suing the same defendants on the same grounds. Fortunately, they have had less luck. This past summer, the public nuisance theory was rejected by high courts in New Jersey and Missouri. In Wisconsin, two high-profile trials were held this year; the plaintiffs lost them both.

Still, Motley Rice has cases going in Ohio, California and Wisconsin.

See also this list of earlier ILB entries on lead paint litiations.

Posted by Marcia Oddi on December 9, 2007 12:11 PM
Posted to General Law Related