Philly is No. 1 'judicial hellhole,' group says

John O'Brien Dec. 14, 2010, 1:00am

ATRA president Sherman Joyce

WASHINGTON (Legal Newsline) - Six jurisdictions have been labeled by the American Tort Reform Association as "judicial hellholes" this year, with Philadelphia garnering the most criticism.

Philadelphia, home to the Complex Litigation Center, wasn't even mentioned in the ATRA's 2009 Judicial Hellholes report but unseated South Florida as the jurisdiction least fair to defendants, in the group's eyes.

South Florida was bumped to fourth, with a pair of California counties second and West Virginia third. Cook County, Ill., and Clark County, Nev., were fifth and sixth, respectively.

Philadelphia's CLC is looking for ways to open itself to new lawsuits because thousands of Phen-Fen cases have concluded, the report says.

It blames Sandra Mazer Moss, the founder of the CLC who recently reclaimed her spot as coordinating judge of the mass tort program, and Common Pleas President Judge Pamela Pryor Dembe for wanting to make the city attractive to plaintiffs attorneys.

"In addition to generating substantial filing fees for the court, out-of-state lawyers are an economic stimulus for Philadelphia, according to Judge Dembe," the report says.

"These litigation tourists eat at local restaurants, stay in city hotels, and hire local counsel."

The CLC's mass tort program oversees litigation in the areas of asbestos, hormone replacement therapy, Yaz and Avandia, among others.

Figures obtained by Legal Newsline show that there are 18 programs with active cases ranging from as low as one (Digitek, firefighter hearing loss) to as high as 1,550 (hormone replacement theory).

Phen-Fen has only three, down from more than 11,000 in 2005. The total number of cases in the mass torts program reached a five-year low of 2,498 in March 2007 but has since nearly doubled to 4,790.

Yaz cases started with 18 in Oct. 2009 but there were nearly 1,000 active on the docket a year later.

"The mass torts program places expediency over fairness. In order to resolve cases in a predetermined amount of time, multiple cases are set for trial in a given month," the report says.

"These cases may involve several plaintiffs, represented by multiple law firms, all arrayed against the same defendant company. The defense attorneys' challenge to prepare for multiple and overlapping trials, most of which typically include several weeks of testimony, places extraordinary pressure on them and their clients to settle cases, regardless of the respective merits."

The report also takes issue with the reverse bifurcation procedure used to try asbestos lawsuits. It involves two trials -- the first on damages and the second liability. At least one defendant would like to see the practice ended.

"After hearing hours of pain-and-suffering and medical causation testimony based on matters defendants do not dispute, jurors understandably become sympathetic to plaintiffs," the report says.

"This places defendants in a difficult situation, as the jury becomes focused on compensating plaintiffs' injuries even before the defendants have an opportunity to show they were not responsible."

The report also says verdict amounts are up and that the Pennsylvania Supreme Court's decision to allow government agencies to hire private lawyers on a contingency fee and the state's use of joint and several liability are not helping the area's reputation.

ATRA credits two counties for placing California second on its list, as well as the amount of class action lawsuits the state faces.

Los Angeles County is mentioned for an April verdict that gave an asbestos plaintiff $200 million in punitive damages and $8.8 milllion in compensation. The city's power and water authority was held liable for one-third of the award.

And in Humboldt County, the report notes a $677 million class action verdict against Skilled Healthcare Group. The lawsuit alleged staffing at the group's 22 facilities fell below the required 3.2 nursing hours per patient per day.

The company couldn't afford the appeal bond because it had only $2 million in assets and settled for an undisclosed sum.

West Virginia has been placed on the list regularly since 2002, and this year it is criticized for not going further in creating an intermediate court of appeals.

Then-Gov. Joe Manchin's pledge to create one was listed as a "Point of Light" last year, but state Supreme Court Chief Justice Robin Davis has resisted such change, the report says.

"She argued through an open letter that litigants in West Virginia already have a right of appeal - they can petition the court to review the case," the report says.

"When the state's business community and others took issue with her remarks, noting that asking the court to hear a case and having a court actually decide a case on the merits are hardly the same thing, the court proposed changes to its appellate rules."

The new rules require the court to issue a decision on the merits of every case, but the court can issue a memorandum decision requiring only a concise statement of the reason for the court's decision, the report says.

"(I)t is different from a traditional judicial opinion that fully analyzes the claims in the case and can be cited as precedent," the report says. "Without the force of precedent, memorandum decisions could result in significant confusion among lower courts."

South Florida also usually takes a spot on the list. Last year's report blamed medical malpractice lawsuits, tobacco lawsuits and generous verdicts as reasons it was given the top spot.

This year's report follows up on tobacco litigation. It says 8,000 lawsuits are pending, and multi-million-dollar jury awards are becoming more common. Philip Morris has lost nine trials in the past two years, resulting in $86 million in awards. It has only lost one trial in the same time in the rest of the country.

Cook County, home of Chicago, is another longtime "hellhole" -- it has been on the list every year since 2005. The report says its circuit courts collect more money in filing fees and other revenue -- more than $111 million -- than all other Illinois counties combined.

Notable cases from Cook County, ATRA says, are so-called "popcorn lung" cases, where plaintiffs allege lung disease caused by exposure to an ingredient needed to make butter-flavored popcorn.

A Cook County jury returned a verdict of $30.4 million in September in one such case.

"In this case, the jury not only agreed that the plaintiff popcorn factory worker's lung disease was caused by exposure to the ingredient, it returned a whopping award that will invariably be cited by plaintiffs' lawyers in other jurisdictions and encourage similar claims," the report says.

And for the third time in four years, Clark County was deemed a "hellhole." It was on the 2009 report's watch list.

Mentioned is a $500 million verdict agaisnt two pharmaceutical companies blamed for a Hepatitis C outbreak.

Those jurisdictions on ATRA's watch list include:

-Madison County, Ill., a haven for asbestos lawsuits;

-Atlantic County, N.J., a forum for lawsuits against the pharmaceutical industry that was deemed a "hellhole" last year;

-St. Landry Parish, La., noted for a $258 million verdict against Janssen Pharmaceutica in a lawsuit brought by the Attorney General's Office and private attorneys;

-District of Columbia, criticized for its consumer law;

-New York City and Albany, N.Y., where ATRA says Assembly Speaker Sheldon Silver has a "liability-expanding agenda" and a "personal financial stake" in a company that gives loans to law firms; and

-St. Clair County, Ill., which is Madison's neighbor and is viewed as a jurisdiction for personal injury lawyers around the country, ATRA says.

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