Panel Examines Need to Make Mass Litigation More Client-Friendly, Inclusive

Federal Judges Weinstein, Hellerstein, 9/11 Claims Administrator Kenneth Feinberg Among Those Discussing “Democratization of Mass Litigation”

When it comes to class-action suits and other mass litigation, plaintiffs often find they lose a voice in the process once they sign on to a case and the lawyers take over, said experts at a Columbia Law School panel.

Whether there can be a “democratization” of mass litigation to enable a better relationship between class members and their lawyers was discussed June 11 at a session convened by U.S. District Court Judge Jack Weinstein ’48.

The discussion was one of several panels on cutting-edge legal topics as part of Reunion 2011 weekend at Columbia Law School. It was moderated by Professor John C. Coffee, a nationally recognized expert on class actions, who called Weinstein the “Abraham, Moses, and David” of mass torts.

Indeed, since assuming the bench in 1967, Weinstein has presided over many major mass tort cases, including those involving Agent Orange, breast implants, tobacco, and asbestos. Often lauded for his innovative approaches to settling cases, especially ones that stretch over multiple jurisdictions, Weinstein said plaintiffs too often become an afterthought in mass litigation.

“Typically, in mass actions, the client’s input is minimal,” Weinstein said. “They may feel disaffected and resentful. They may want more participation and understanding.”

That can be a lot easier said than done, which is why U.S. District Judge Alvin Hellerstein ’56 said he denied class-action status for more than 10,000 suits linked to the 9/11 attacks on the World Trade Center.

“A class-action gives extreme power to the class lawyer, and a judge is at the mercy of the lawyer in terms of which cases to advance, which to settle,” Hellerstein said. “I quickly understood that these were an accumulation of different kinds of cases.”

Hellerstein ultimately oversaw a settlement in 2010 of at least $625 million to more than 10,000 rescue workers who sued New York City after being sickened by dust from the World Trade Center. That deal came after he rejected another settlement several months earlier that he said was inadequate and confusing.

Hellerstein appointed another panelist, Kenneth Feinberg, to hear appeals from compensation decisions stemming from the settlement. Feinberg first came to national attention when he was named as administrator of the September 11th Victim Compensation Fund established by Congress.

“I conducted 1,500 hearings of families who lost loved ones on 9/11,” said Feinberg, a Lecturer-in-Law at the Law School who has also co-authored a mass torts casebook with Weinstein. “Nobody talked to me about how much money they were going to get. They came to me to vent about life’s unfairness.”

Feinberg eventually parceled out $7 billion to more than 98 percent of the families in exchange for an agreement not to sue.

“Unless you give the plaintiff, or the claimants, some say in his or her result, the very credibility of the rule of law, and particularly that settlement, is called into question,” Feinberg said.

Not surprisingly, such litigation can be extremely costly for plaintiff class-action firms that typically work on a contingency-fee basis. Columbia Law School Associate Professor Bert Huang spoke about an emerging trend in the U.S., where hedge funds and banks help fund the litigation in exchange for a cut in the outcome.

“Now there’s a new party in town and judges should have to pay attention to this,” Huang said. “You really need to understand the outside influences that might press against the plaintiffs’ interests.”

Elizabeth Cabraser, partner at Lieff, Cabraser, Hellman & Bernstein, a major class-action law firm, said defendants often try to “turn mass litigation into a war of attrition where all the money is spent before the matter is resolved and there’s very little left to pay claims.”

But that does not mean a reasonable settlement need be all but unattainable. Cabraser was the plaintiffs’ liaison counsel in a number of suits against Pfizer over the anti-inflammatory drugs Bextra and Celebrex, which the company settled after three years in 2008 for $894 million. A special master appointed to oversee the settlement praised both sides for a “minimum of rancor and a maximum of candor” in reaching a deal.

Another panelist, Pfizer General Counsel Amy Schulman, represented the company during those suits while she was a partner at DLA Piper. She said there is often a dichotomy between giving people their day in court and determining the merits of their claims.

“I think some defendants assume that, at the end of the day, the price of resolving good claims is going to be paying the bad claims,” Schulman said.