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AAJ News Brief for May 21, 2010



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AAJ News Brief for Haytham FarajFriday, May 21, 2010
Leading the News
Civil Justice System
Congress
Employment/Workplace Safety
Medical Errors/Healthcare
Product Safety
Securities
Also in the News

Leading the News

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As BP, government try to determine size of spill, EPA halts use of dispersants.

All three broadcast networks carried reports of the oil spill as their lead story Thursday evening, with ABC World News (5/20, lead story, 4:05, Sawyer) reporting, "It seems every day there is a new outrage in the oil spill story, and today, a one-two punch. All day, we have been looking at these: the first live pictures of the oil spewing out of the broken well. And some of the scientists who saw it told us they're stunned, saying there is vastly more oil than BP has said. The slick itself now about the size of New Hampshire. ... And add to this tonight, the government saying the chemicals BP has been using to clean up the oil may be causing more damage." ABC added, "Today BP said they're siphoning 5,000 barrels a day. That was the total amount BP and the government long estimated had been leaking. Numerous experts today say it's clear those numbers fell far short."

        According to the CBS Evening News (5/20, lead story, 3:50, Couric), "By even the most conservative estimate, more than six million gallons has already poured into the gulf," and "under new orders from the EPA BP now has to switch to less toxic chemicals. ... BP has already used 655,000 gallons of the toxic dispersants. Congress has questioned why BP chose these chemicals, bought from a company where a former BP executive sits on the board. Now the three members of Congress who finally have the video are working to get it into the hands of experts who can make sense of it."

        USA Today (5/21, Levin) reports that according to a USA Today review of the latest scientific studies and some of the world's top experts, the dispersants "have questionable value over the long run and may actually slow down the bacteria that biodegrade crude oil." According to researchers and EPA data, "dispersants are toxic, and when mixed with oil can become even more dangerous than either the dispersant or oil alone." However, according to EPA records, "BP will not be able to find an alternate dispersant that is not toxic," because, "all 14 of the approved dispersants listed on the agency's website are toxic to marine life at levels of a few hundred parts per million or less."

        The AP (5/20) reports that the National Oceanic and Atmospheric Administration "says a task force of scientists is working around the clock to get a better idea how much oil is gushing from the blown-out well in the Gulf of Mexico," but NOAA chief Jane Lubchenco "would not give a new estimate of how much oil the scientists think is leaking."

        According to McClatchy (5/21, Taylor, Schoof, Bolstad), while BP and the Administration "have said they don't want to take the measurements for fear of interfering with efforts to stop the leaks," that decision "runs counter to BP's own regional plan for dealing with offshore leaks," which says that "an accurate estimation of the spill's total volume...is essential in providing preliminary data to plan and initiate cleanup operations." And "legal experts said that not having a credible official estimate of the leak's size provides another benefit for BP: The amount of oil spilled is certain to be key evidence in the court battles that are likely to result from the disaster."

        The Wall Street Journal (5/21, A6, Ball, Ordonez, Hughes) reports that local officials have also increased their criticism of BP, while scientists warned that the environmental damage caused by this spill could rival that caused by the 1989 Exxon Valdez disaster.

        Officials, volunteers question BP influence in testing, cleanup efforts. In a front-page story, the New York Times (5/21, A1, Urbina) reports, "Local environmental officials throughout the Gulf Coast are feverishly collecting water, sediment and marine animal tissue samples that will be used in the coming months to help track pollution levels resulting" from the spill, which will ultimately "be used by the federal government and courts to establish liability claims against BP. But the laboratory that officials have chosen to process virtually all of the samples is part of an oil and gas services company in Texas that counts oil firms, including BP, among its biggest clients." Some local officials are even refusing instructions from NOAA "to send water samples to the lab," opting "instead to get a waiver" to send "samples to a local laboratory that is licensed to do the same tests." Meanwhile, federal officials have told local animal rescue workers who have volunteered to help "that the work must be done by a company hired by BP."

        Oil slick reaches Louisiana's marshes. The AP (5/21, McGill) reports, "The spectacle many had feared for a month finally began unfolding as gooey, rust-colored oil washed into the marshes at the mouth of the Mississippi for the first time, stoking public anger and frustration with both BP and the government." Although "there were no immediate reports of any mass die-offs of wildlife or large numbers of creatures wriggling in oil, as seen after the Exxon Valdez disaster," that remains the fear of many.

        A separate story from the AP (5/20) reports that managers of the Breton National Wildlife Refuge, a "renowned bird sanctuary" about eight miles from the Louisiana coast in the Gulf of Mexico, "say they have found their first dead pelican."

        Gulf fishermen rush to work ahead of spill. The CBS Evening News (5/20, story 2, 2:00, Couric) reported, "Some fishermen are in a race against time."

        But Louisiana's Baton Rouge Advocate (5/21) reports the Louisiana Department of Health and Hospitals "announced this morning that it has partially reopened oyster harvesting," in certain areas in order "to give harvesters as much time as possible to harvest their product before any potential impact from the BP oil leak."

        Spill appears to move away from Mississippi. Meanwhile, Mississippi's Biloxi Sun-Herald (5/21, Nelson) reports that Bill Walker, head of the Mississippi Department of Marine Resources, said "the bulk of the spill appears to be moving further from Mississippi shores, and breaking up from the skimming, burning and dispersant use."

        Crist declares state of emergency in South Florida. The Orlando Sentinel (5/21, Fleshler) reports, Florida Gov. Charlie Crist "proclaimed a state of emergency for Broward, Miami-Dade and Palm Beach counties Thursday, as the risk increased that oil from the Gulf of Mexico spill would reach the state's shores." The governor "cited reports that oil had been caught up in the loop current, which sweeps around the Florida peninsula, saying this created a 'potential threat to additional counties bordering the Gulf and the Atlantic seaboard.'"

        Suit filed to recover damages to tourism industry. Alabama's Mobile Press-Register (5/21, Kramer) reports, "Montgomery-based law firm Beasley, Allen, Crow, Methvin, Portis and Miles P.C. has filed a lawsuit against BP PLC in an effort to recover damages coastal property owners and rental agencies have suffered because of the Deepwater Horizon oil spill." The lawsuit "'alleges negligence and wanton misconduct' on BP's part, according to the release. Also named in the suit are Haliburton and Cameron International."

        BP waiver of $75M liability cap may be moot if safety lapses occurred. Bloomberg News (6/21, Cronin, Fisk) reports, "BP Plc's pledge to waive a $75 million limit on environmental damages for its Gulf of Mexico oil spill may prove an empty gesture if safety violations played a role in the disaster. The US Oil Pollution Act of 1990 requires parties responsible for a spill to pay cleanup costs, while it limits payouts for private economic and public natural-resource claims to $75 million. Exceptions include gross negligence, willful misconduct and the violation of safety rules."

        Columnist says contingency fee cap handcuffs Florida AGs. In a column for Gannett (5/21), Paul Flemming writes, "Lawmakers, Gov. Charlie Crist and Attorney General Bill McCollum handcuffed current and future Florida attorneys general right before the Gulf oil-spill disaster started." The law "that goes into effect July 1 caps contingency fees at $50 million on contract work for the Office of the Attorney General." Trial attorney Fred Levin said, "You're not going to get the best lawyers to come in on a Dream Team where you've capped the attorney's fees." Flemming comments, "Now Florida needs those Terminator litigators and may have to settle for the discount aisle at Lawyers R Us."

        NYTimes urges Administration to use outside experts to investigate spill. In an editorial, the New York Times (5/21) writes of the oil spill, "At issue here are two things we want from the Obama administration: transparency and toughness. The public needs to know everything the administration knows, in real time. If the administration is being kept in the dark by BP, the answer is to get tough with BP." The Administration "is expected to appoint a commission to investigate the spill, including its causes and the regulatory lapses that preceded it," but "right now, the Minerals Management Service and the Coast Guard are basically investigating themselves -- an untenable situation." According to the Times, "the new commission should include experts who do not work for either government or industry, whose cozy relationship over the years is partly responsible for this mess we are in."

From the American Association for Justice

The catastrophic oil spill in the Gulf Coast has devastated a yet unknown number of victims and industries. AAJ's teleseminar, Gulf Coast Oil Spill Litigation, June 2, held exclusively for AAJ Plaintiff Lawyers, will include an overview of the types of plaintiffs and claims, a discussion on OPA and preemption, an explanation of the interplay of DOHSA and Jones Act, a state law claim analysis, and an update from AAJ on legislative developments. You do not want to miss this opportunity to learn from the experts. To view the agenda and register, visit Continuing Legal Education.

Recently, the Medicare Secondary Payer Recovery Contractor (MSPRC) made some changes to the Medicare Secondary Payer conditional payment process. The MSPRC has created a powerpoint presentation which gives an overview of the changes and how to best navigate the Medicare Secondary Payer process. This information should helpful in minimizing the amount of time it takes to go through the Medicare Secondary Payer process. The powerpoint presentation can be found at the following Web site:

http://www.msprc.info/forms/Town%20Hall%20Presentation.pdf

Further information from the MSPRC can be found on their Web site at:

http://www.msprc.info/

AAJ is continuing to try and improve this process. However, these Web sites offer information that will assist you in making the most of the current system.

Civil Justice System

Jury awards $29.1M to widow in RJR Tobacco case.

Bloomberg News (5/20, Van Voris) reported, "R.J. Reynolds Tobacco Co. must pay $29.1 million to Connie Buonomo, the widow of a Florida man who started smoking at age 13 and died of chronic obstructive pulmonary disease in 2008, a jury in Fort Lauderdale said. The unanimous verdict today by six state jurors includes $4.1 million in compensatory damages and $25 million in punitive damages." Jurors in Florida "have delivered more than $230 million in verdicts for smokers and their families since February 2009."

Florida jury awards $14M in asbestos case.

The Miami Herald (5/21, Morales) reports, "A Miami-Dade jury has awarded a Sarasota man more than $14 million after deciding that the asbestos he inhaled in the 1970s caused his deadly abdominal cancer. Jurors found that chemical giant Union Carbide was negligent for selling asbestos fibers to other companies, which had used the fibers to make joint compounds used by construction companies -- such as the one William Aubin's family owned." Jurors "also found that four of the compound manufacturers, including Georgia-Pacific, share some of the responsibility for causing Aubin's illness."

Oregon man suing Portland archdiocese over abuse.

The Oregonian (5/20) reported, "A man who claims a 2008 suicide attempt caused him to connect a lifetime of misery to a childhood rape by a Catholic priest has filed a $2.8 million federal lawsuit against the Archdiocese of Portland in Oregon. The man, identified only by his initials in US District Court papers, accuses Father Leonard E. Plocinski of grooming him for sex and ultimately raping him in the late 1970s, when he was an altar boy of 8 or 9 in Dallas, Ore." A civil complaint "filed last Friday seeks $2.5 million for pain and suffering and economic damages of $300,000 -- including an estimated $50,000 for counseling and psychological treatment."

Congress

Senate passes financial reform bill in major victory for Obama.

At about 8:30 Thursday evening, the Senate passed the Restoring American Financial Stability Act of 2010 on a vote of 59-39, in what is being called a major victory for President Obama. Republicans Scott Brown, Susan Collins, Charles Grassley, and Olympia Snowe voted in favor of the bill, while Democrats Maria Cantwell and Russ Feingold opposed it. The vote came too late for broadcast network news coverage, but ABC World News (5/20, story 3, 0:50, Sawyer) noted the earlier 60-40 cloture vote, saying the President "won another legislative victory" with the Senate "finally clearing the way for his sweeping rewrite of regulations for the nation's banking system."

Massey CEO defends record at Congressional hearing.

Massey Energy CEO Don Blankenship defended his company's record at a Congressional hearing Thursday on mine safety. It was his first appearance before Congress since the explosion at the West Virginia mine that killed 29 people in early April. The AP (5/20, Hananel) reports that Blankenship "went on the defensive Thursday as he faced angry lawmakers who claim the company's indifference toward safety led to the nation's worst mining disaster in 40 years." The executive said, "Massey does not place profits over safety." Sen. Robert Byrd, D-W.Va., didn't agree, saying the mine had "an alarming record" of serious infractions, the AP notes.

        The Hill (5/21, Snyder, Geman) reports that Blankenship "nonetheless defended his company's overall safety record as among the industry's best, even as he acknowledged the mine received 47 serious safety citations during a seven-month period in 2009." Assistant Secretary of Labor for Mine Safety and Health Joseph Main stated that federal safety citations issued at the mine "have not only been more numerous than average, they have also been more serious." Cecil Roberts, president of the United Mine Workers of America, said the number of citations issued at the Upper Big Branch mine "far exceed industry norms."

        The Wall Street Journal (5/21, Maher) notes that Massey CEO tried to shift the blame to the federal Mine Safety and Health Administration, saying its inspectors visited the Upper Big Branch mine several days before the explosion, and that they said it had "no outstanding major safety issues" and was in "good condition." Joe Main, the head of MSHA, said that Massey prevented stronger enforcement action, such as closing down mines with a history of safety violations, by filing a series of appeals, and he called on Congress to free up funds to help clear up a backlog of challenges filed by companies.

        Bloomberg News (5/21, Rosenkrantz) reports Byrd criticized the MHSA, saying he is "perplexed" as to how the tragedy could have happened "given the significant increases in funding and manpower" Congress has approved for the agency. Byrd said, "Given the safety record at this mine, why, oh why, did MSHA wait so long to launch an inspection blitz?"

        Blankenship wants outside agency to probe mine blast. The New York Times (5/21, Wald) reports Blankenship said an outside agency should investigate the recent explosion at his mine, which killed 29, "because otherwise the Mine Safety and Health Administration, the agency now in charge, would have to evaluate its own performance." Cecil E. Roberts, president of the United Mine Workers of America, "challenged Mr. Blankenship's assertion that Massey's safety record was average." He said, "I can't come up with another coal company that's had 23 miners in 10 years die." He added, "This isn't average. This is deplorable."

Employment/Workplace Safety

Menzies Aviation workers sue for racial harassment.

The Houston Chronicle (5/21) reports, "Three former employees of an international airport services company have filed a federal lawsuit alleging repeated racial harassment and intimidation at its Houston warehouse that began after President Barack Obama's election. The three African-American men worked as cargo handlers for Menzies Aviation at George Bush Intercontinental Airport, where the company has a contract with Air France and KLM airlines." Robert Collier, one of the attorneys representing the men, "said other Menzies employees and former employees, Hispanic and black, have come forward to confirm the type of racial comments and hostility alleged in the lawsuit by Kanon Dillard, Allen Eaden and Tracey Harris."

Medical Errors/Healthcare

California health officials fine nine hospitals for safety violations.

The Los Angeles Times (5/21, Hennessy-Fiske) reports, "State officials have fined nine California hospitals for medical errors last year that in some cases killed or seriously injured patients, according to a report made public Thursday. California Department of Public Health officials have required hospital officials -- who may appeal the fines -- to submit plans to correct the problems." Notably, "three hospitals in Orange County and the Inland Empire face $50,000 penalties, the first such fines for each."

        The San Francisco Chronicle (5/21, Colliver) adds, "Marin General Hospital and Alameda County Medical Center were among nine hospitals cited Thursday by state health officials for safety violations that were serious enough to cause patient death or injury." Officials "fined Oakland's Highland Hospital $75,000 for a medication error that resulted in the death of an unidentified patient in October 2009. According to a report on the incident, a nurse improperly administered an anti-seizure drug." Meanwhile, "Marin General...received a $50,000 fine after surgical staff left a sponge inside a woman following a cesarean section in September. The sponge was successfully removed, and disciplinary action was taken against the nurse and technician who failed to follow proper procedures."

Oklahoma revokes doctors' licenses.

The Oklahoman (5/21, Brown) reports, "The Oklahoma State Board of Medical Licensure and Supervision on Thursday revoked the licenses of three doctors and accepted the license surrender of an Oklahoma City surgeon who was the subject of an international controversy after a brain surgery that ended in a teenager's death. Dr. Paul Christopher Francel has been sued for medical negligence more than 30 times from June 2000 through May 2009, board investigators wrote in a complaint against him. In a statement read to board members by Francel's attorney, Linda Scoggins, Francel said he was mentally and physically unable to practice medicine and wanted to voluntarily give up his license."

Product Safety

House members refute Toyota's assurances of safe engine electronics.

The Los Angeles Times (5/21, Puzzanghera) reports that House Energy and Commerce Chairman Henry Waxman, speaking at his committee's hearing into the cause of Toyota's sudden acceleration crisis, said that the automaker "still had not done the testing required to determine the cause...and had been more concerned about its image than addressing the issue. Toyota has said it was confident electronics were not causing" sudden acceleration, but Waxman "said that his panel's investigation had raised serious questions about the scope of Toyota's efforts" to root out an electronic fault. "'Toyota has repeatedly told the public that it has conducted extensive testing of its vehicles for electronic defects. We can find no basis for these assertions,' Waxman said."

        The Washington Post (5/21, Whoriskey) reports that Waxman said that Toyota's investigations seem "to have been aimed less at identifying the root problem than at public relations." The Post notes that Toyota has "assured worried customers and Congress that it was conducting an independent investigation," but yesterday, "congressional investigators said the company that Toyota has hired to do the review, Exponent, had offered no written plan for the project or any written specifications for the experiments it intends to run." The Post reports that Waxman called the investigation "deeply troubling," and rejected Exponent's explanation of a lack of a written plan "preposterous."

        The Wall Street Journal (5/21, B3, Ramsey, Mitchell) reports that despite congressional criticism, NHTSA administrator David Strickland has implied that Toyota's investigatory efforts are adequate, noting that he told the House committee on Wednesday, "We have found no evidence of additional causes of the defect, but that doesn't mean we've stopped looking." The Journal characterizes Strickland's comments about the potential for an electronic fault to be in accord with Toyota's.

Target recalls storage trunks following child's injury.

The AP (5/20) reported, "Target Corp. and the US Consumer Product Safety Commission on Thursday said about 350,000 woven storage trunks are being recalled after an 18-month-old girl suffered brain damaged when the lid fell on her neck. The recall involves 14 models of trunks made of woven rattan, abaca or banana leaf with standard hinges. They were sold at Target stores nationwide and on the chain's Web site from February 2009 through last month, for between $50 and $130."

Securities

Pitfalls of abolishing mandatory securities arbitration discussed.

In a column in Dow Jones Newswires (5/21), Suzanne Barlyn discusses the potential downsides for investors seeking to abolish mandatory securities arbitration. She observes that FINRA should retain a rule requiring brokerages to submit to arbitration at an investor's request, even if mandatory arbitration is eliminated.

Also in the News

DC officials, residents react with fear, anger to findings about lead in drinking water.

The Washington Post (5/21, Leonnig) reports, "Federal and local political leaders, D.C. parents and health advocates reacted Thursday with a mixture of anger and fear to news that a federal agency misled them about the harm that lead in the District's water had caused -- and might still be causing." Notably, the "furor came as a House investigative subcommittee released a report showing that the federal Centers for Disease Control and Prevention knowingly used flawed data when telling D.C. residents that their health hadn't been harmed by spikes in lead in the drinking water in 2004. The investigation, the subject of a congressional hearing Thursday, also disclosed new cause for alarm: Internal CDC research shows that an effort to fix the lead problem since 2004 puts residents in 9,100 D.C. homes at much higher risk of lead poisoning."

        According to the AP (5/21, Jessica Gresko), "The report...admonishes the Centers for Disease Control and Prevention for the study's methodology, and says the CDC has 'failed its public health responsibilities' by refusing to withdraw the report." But, "a CDC official defended the federal agency, saying it reported as factually as it could in 2004, based on information it had. A second analysis -- with many more blood tests -- was later conducted." Dr. Robin Ikeda, the CDC's deputy director of environmental health, said, "We have concluded that CDC's initial reports did not understate the magnitude of the problem."

        CQ HealthBeat (5/21, Reichard) also quotes Ikeda as saying, "Some people may have misinterpreted" the 2004 report "to mean that there was no problem with the lead in D.C. water...we never intended to convey that there's any safe level of lead." Nevertheless, "Marc Edwards, a civil engineering professor at Virginia Tech, told the panel that" the "March 30, 2004 issue of CDC's Morbidity and Mortality Weekly Report (MMWR) was essentially a 'publicity stunt' to reassure DC residents alarmed that lead in drinking water would lead to dangerous levels of lead in the blood harmful to neurological development."

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