Arbitration in Consumer Contracts

I have had a long interest in the issue of whether arbitration should be compelled when the arbitration agreement is simply a part of the boilerplate in a contract for consumer goods or services. The Ohio Supreme Court has recently held that such contracts must be enforced, even when a specific statute grants the right to proceed in a class action or as a private attorney general. The case was Hayes v. Oakridge Home, Slip Opinion No. 2009-Ohio-2054.

Ohio is one of the few states that have gone this way. Most states have held that these arbitration agreements are void as against public policy. For example, the National Law Journal reports that Massachusetts recently held arbitration clauses to be be void as against public policy. Read that article here.

To Blog of Legal Times (BLT) reports today that The National Arbitration Forum has agreed in a settlement with the Attorney General of Minnesota to get out of the consumer arbitration business. You can read that article here.

When I read the article I actually had a good laugh at this quote:

“Until Congress resolves the legal and legislative uncertainty, the cost is simply too high for users and providers of consumer arbitration,” he said.

Until then, Kelly warned, “The consequence to American consumers is that there will be no meaningful alternative to costly and unpredictable litigation.”

He means, I guess, that the consumer should avoid "unpredictable" litigation over the "predictable" pro-business, anti-consumer award that typically comes out of consumer arbitrations.

Here's the thing. Consumers can't afford to litigate small claims. Lawyers won't handle them. Take a look at the typical FDCPA claim, in which you are only going after the statutory damages of $1,000.00. Lawyers can't afford to take on a case that is only going to bring in a couple hundred in legal fees. The only way the consumer has any kind of redress is if he can aggregate his claims with the claims of hundreds, or thousands, of others in a class action. And the only way to prevent the business from continuing the practice that is in violation of law is to obtain injunctive relief by suing as a private attorney general.

Ohio has closed that door. Perhaps, as the article suggest, Congress may overturn that with a well crafted statute.

~Tim

Publicity

My client in the so-called "murder for hire" case that was featured on Nancy Grace a year or so ago entered a no contest plea this week. She will serve 15 days in the county jail and can serve the time on weekends. Pretty good outcome considering that she could have received 25 years in prison if found guilty as charged.

There must have been a reporter in the courtroom since the entire plea exchange with the judge was printed up in the paper this morning. They got it correct for the most part, including the part where the DA credited the motions I had filed as being the reason why they were giving such a good deal. He said they were "not without merit."

In any event, my client in this case got treated roughly in the media when the case first began. I was not her lawyer at that point, she changed to me right after the preliminary hearing. If I had been a publicity seeking hound I could have played this one for all it was worth, but I value my privacy and that makes me value hers just as well.

Still, it would have been nice to tangle with Nancy Grace.

~Tim

Traffic Cameras

Callers to my radio show continue to be intrigued by the issue of cameras installed at traffic lights and intersections so that you can be mailed a ticket for any infraction. A local city. Mt. Juliet, is considering installing them.

I happened to wonder, just the other day, exactly how the photo could be admitted. After all, in order to admit a photograph, you have to elicit testimony that it accurately depicts the conditions at the time it was taken. In the case of an automated traffic camera, who would authenticate it? No one is present when it was taken and the driver can refuse to testify.

Here is what I imagine is the case. Most cities, and states, consider violation of the traffic laws to be civil, not criminal, in nature. I expect that they will argue that the rules of evidence don't apply to the proceedings to enforce infractions caught on camera.

I don't see that the issue has been litigated in Tennessee and I haven't looked elsewhere. Perhaps someday a case will present itself and I can raise the issue (and the client will fund an appeal). Until then, it makes for interesting conversation amongst us lawyers.

~Tim

Supreme Court Requires Recusal in Campaign Donations Case

The U.S. Supreme Court just ruled in the case of Caperton v. A.T. Massey Coal Company that a judge is required to recuse himself in instances where a litigant made substantial contributions to his election campaign.

In a scenario straight of of Grisham's "The Appeal" the A.T. Massey coal company, who lost a jury trial, made $3 million in campaign contributions to someone running for a seat on the West Virginia Supreme Court of Appeals. Given that much money, the outcome of the campaign was a foregone conclusion and their candidate won.

When the case arrived at the appellate court, the newly elected judge refused to step aside and then joined the majority in overturning the lower court's decision. Today, the U.S. Supreme Court said that this action violates the due process clause. The Court stated:

There is a serious risk of actual bias when a person with a personal stake in a particular case had a significant and disproportionate influence in placing the judge on the case by raising funds or directing the judge’s election campaign when the case was pending or imminent. The proper inquiry centers on the contribution’s relative size in comparison to the total amount contributed to the campaign, the total amount spent in the election, and the apparent effect of the contribution on the outcome. It is not whether the contributions were a necessary and sufficient cause of Benjamin’s victory.

Interestingly enough, the decision was only 5-4, indicating that four justices apparently think it's OK to buy a judge. Those four are Roberts, Scalia, Thomas and Alito.

~Tim

Defining Your Case Through News Article Comments

Every trial practice class we take tells us that we have to devise a "story" of our case. The story is what we teach the jury (or judge) as we try the case. Each witness and exhibit builds our story to lead the jury to believe in its truth and, ultimately, to rule on our favor.

But how do we know that our story will resonate with a jury? That's always been more of an art than a science. We tell the story to staff members, other lawyers - anyone who will listen. If we have a client with a little money we might do a focus group. If we're lucky enough to have a client with a lot of money (and an important case) we might even hire a jury consultant to help us craft both the story and to develop a profile of the "ideal" juror. Still, we never know until the verdict comes back.

Here's another thing to add to our toolbox - one that won't cost your client a cent. Most newspapers and TV stations are now posting their articles online. And most of the online web sites permit readers to post comments telling what they think of the story.

If an article is written about your case, pay close attention to the readers' comments. They come from the general public - the same general public that makes up your jury pool. I am undecided about the ethics of posting comments of your own or otherwise interacting with the readers - I lean toward it being unethical but haven't researched the issue - but there is no harm in looking at what people say and then crafting your ultimate case presentation accordingly.

In fact, I'll go out on a limb and say that, sometime in the next ten years, we will see an attorney somewhere held liable in malpractice for presenting a case without taking readers' comments into account.

~Tim

Interesting Fee Agreement

I saw a post on one of the mail lists I follow regarding an interesting fee arrangement for criminal cases. The attorney reports that his fee agreement only covers pre-trial matters and has a clause that provides that any case that goes to trial will carry an additional fee to be negotiated later.

I can see the issue he is trying to address - the situation where you charge $x and then enter a guilty plea very early in the process so that you don't have enough hours in the case to justify $x. But I would worry that, since the client knows that he will have to pay more if he maintains a not guilty plea and goes to trial he will feel great pressure to take a deal even if it would be better for him to go to trial.

It is tempting to adopt the incremental fee approach and I am going to look closely at the issue. If anyone has any thoughts on the topic I would love to hear them.

~Tim

The Supreme Court Gives and Tennessee Tries to Take Away

The U.S. Supreme Court handed down a decision last week that upheld rights under the Fourth Amendment. Now Tennessee is considering a bill that would eliminate the exclusionary rule that prevents evidence seized in violation of your Fourth Amendment rights from being used against you.

Now, I think that most of us can agree that such a bill would be subject to constitutional attack but you still have to wonder what the legislature is thinking. Why is it considered so important to obtain convictions that they are willing to do it at any price? Why do they think that it is ok to condone breaking the law (the Fourth Amendment) in order to enforce the law? And since most of these cases involve such serious crimes as simple possession of marijuana or some other drug is it really that important to take the suspect off the street that we would effectively abolish the Fourth Amendment?

I really don't get it. I guess we have been lucky here in this country not to live under an oppressive government. So lucky that we have forgotten that the basic protections that are provided by the constitution are the reason why we haven't lived under an oppressive government.

The bill will likely fail, but why would they even try?

~Tim