The Jere Beasley Report, Mar. 2008

THE
MARCH 2008
B e a s l e y , A l l e n , C r o w , M e t h v i n , P o r t i s & M i l e s , P. C . , A t t o r n e y s a t L a w
A NATIONAL LAW FIRM LOCATED IN MONTGOMERY, ALABAMA
Helping those who need it most since 1979.
www.BeasleyAllen.com
I.
CAPITOL
OBSERVATIONS
After a lengthy trial a Montgomery

County jury returned a $215 million
verdict against AstraZeneca in the State
of Alabamas Medicaid fraud case.The
State sued the drug manufacturer in
2005 alleging fraud in the pricing of
drugs under the States Medicaid
program. The jury found that
AstraZeneca had falsely reported the
prices of drugs during the period of
time 1991-2004. The reimbursement
formula promulgated by the State Medicaid Program used as part of that
formula what are known as Wholesale
Acquisition Cost (WAC) and Average
Wholesale Cost (AWP). For the formula
to work properly, the prices reported
by the drug manufacturer must be true
and accurate prices. During the entire
period of time AstraZeneca never
reported its true prices.The jury found
that AstraZeneca was guilty of intentional misrepresentation and concealment under Alabama law.
As you may know, over the years
there has been a great deal of fraud
and abuse in the federal healthcare
programs. In 2003 the Department of
Health and Human Services (HHS)
gave written notice to all drug companies participating in the Medicaid
Program setting out guidelines. The
notice laid out in clear and unambiguous language that which was required
of all drug companies, including
AstraZeneca.The purpose of the compliance guidelines was to prevent and
reduce fraud and abuse in all federal
healthcare programs, including Medicaid.The guidelines resulted from findings in investigations conducted by the
Office of Inspector Office of Investigations Generas (OIG) and the Justice
Department. The investigations had
found that the companies were intentionally manipulating the AWP in
prices reported by the companies.

State Medicaid Programs compute
reimbursement for drugs based on
reported AWPs and WACs. Both are
reported by the drug companies, and
as the guidelines stated, state Medicaid
agencies are entitled to depend on the
AWPs and WACs as being complete
and truthful. The OIG stated that the
drug companies, such as AstraZeneca,
are responsible for ensuring the
integrity of data they (the companies)
generate that is used for government
reimbursement purposes. The OIG
guidelines specifically address the
importance of the integrity of data
used by the Medicaid agencies to
establish payment amounts. The
OIG stated further in the guidelines
that the Medicaid agencies set reimbursement with the expectation that
the data provided are complete and
accurate and that the knowing submission of false, fraudulent or misleading information is actionable.
We actually proved our case of fraud
at trial by calling as adverse witnesses a
number of present and former AstraZeneca employees.A clear and convincing case of fraud was made out for the
jurors to consider. We also were able
through pretrial discovery to obtain
internal documents from the company
that were extremely helpful to our case
and damaging to AstraZeneca. One of
the witnesses called at trialwho had
been a key AstraZeneca pricing
officertestified that the company had
engaged in unethical conduct over a
period of time that was illegal. This
employee tried unsuccessfully to get
the bosses at AstraZeneca to put a stop
to the conduct that he described as
sleazy. When his efforts failed, this
man eventually left the company.
The jury awarded $40 million in
compensatory damages and an additional $175 million in punitive
damages. Experts for the State were Dr.
Gerard Anderson, a former employee of
HHS who is now a professor at John
Hopkins University, and Ed Sauls, an
expert in accounting and damages.
Each of these witnesses did a very good
STATE OF ALABAMA WINS THE FIRST

MEDICAID FRAUD CASE
job and were well received by the

jurors. After a thorough investigation,
Attorney General Troy King authorized
the filing of the lawsuit. I, along with
Dee Miles, Clint Carter, Clay Barnett,
and Paul Lynn from our firm and Caine
ORear, Roger Bates, Clay Rankin,Windy
Bitzer, and Tracy Davis from the Mobile
firm of Hand,Arendall, represented the
State in the case. Our staff personnel
also did a great job in helping to get
this case ready for trial.Working on the
case were Greta Beasley, Michelle
Lysdale, Sarah Martinez, and Levi
Nichols.Ashley Pugh handled our docu-
I N TH I S I S S U E
I.
Capitol Observations . . . . . . . . . . . . 2
II.
Recent Settlements By Firm . . . . . . 5
III.
Legislative Happenings . . . . . . . . . . 6
IV.
Court Watch . . . . . . . . . . . . . . . . . . 8
V.
The National Scene . . . . . . . . . . . . 13
VI.
The Corporate World . . . . . . . . . . 15
VII. Product Liability Update . . . . . . . . 17

VIII. Mass Torts Update. . . . . . . . . . . . . 19
IX.
Business Litigation . . . . . . . . . . . . 24
X.
Insurance and Finance Update . . . 24
XI.
Predatory Lending. . . . . . . . . . . . . 26
XII. Premises Liability Update . . . . . . . 29

XIII. Workplace Hazards. . . . . . . . . . . . 30
XIV. Transportation . . . . . . . . . . . . . . . 33
XV.
Arbitration Update . . . . . . . . . . . . 35
XVI. Nursing Home Update. . . . . . . . . . 36

XVII. Healthcare Issues . . . . . . . . . . . . . 37
XVIII. Environmental Concerns . . . . . . . . 38
XIX. The Consumer Corner. . . . . . . . . . 40
XX.
Recalls Update . . . . . . . . . . . . . . . 41
XXI. Firm Activities . . . . . . . . . . . . . . . . 44

XXII. Special Recognitions . . . . . . . . . . . 45
XXIII. Some Closing Observations . . . . . . 46
XXIV. Some Parting Words . . . . . . . . . . . 47
ment presentation during the trial.

They all worked very hard and did an
outstanding job.. Carol Herman Steckel,
the Commissioner of the Alabama Medicaid Agency, was the representative for
the State at trial. She testified and did a
very good job.This was a tremendous
win for the state.
THE NEXT ROUND

We will try another case for the state
on April 7th. Defendants in that case are
GlascoSmithKline and Novartis. The
defendants have a writ pending in the
Supreme Court in an attempt to sever
the cases. Hopefully, we will be able to
try the two defendants together as
scheduled. But if the Supreme Court
says try onewe will try one.
THE $12 MILLION DOLLAR MAN

I have seen lots of expert witnesses
in my time and I must confess that I
have never found one who didnt
charge substantial fees for their services. My experience led me to believe
that the automobile manufacturers
attracted the most expensive experts
and paid them tremendous sums of
money. However, I just met an economist from Washington, D.C. whose fees
charged in a pharmaceutical lawsuit
may have gone to the top of the pay
scale. Dr. Eric Gaier testified in the
AstraZeneca case and during cross
examination had to admit how much
his firm, Bates & White, had charged
AstraZeneca through 2007. Dr. Gaier
had been hired by a coalition of
lawyers representing a number of drug
companies in late 2003.
The
Washington-based
expert
worked for a number of the drug companies during 2004, 2005, 2006, 2007
and 2008 to date. He was one of the 10
experts assigned in 2007 to the
Alabama case by the coalition. Dr. Gaier
testified at trial that he personally
billed for his time at $595 per hour. He
spent one-third of his total hours of
time working on the Medicaid cases
during 2004, 2005 and 2006 and that

increased to one-half of his time in
2007.That ratio carried over into 2008.
Based on him billing a total of 2100
hours each year and then applying the
percentages, Dr. Gaiers total bill would
exceed $12 million. He told the jury
that he had personally been paid
$600,000 during 2007. In addition to
Dr. Gaier, 10 others in his firm also
billed AstraZeneca at huge hourly
charges.At trial, Dr. Gaier said he couldnt tell us how much the total amounts
were that his firm actually billed
AstraZeneca. That was pretty hard to
believe considering that he is a $595
per hour economist.
SENATOR OBAMA IS MY CHOICE

I am backing Senator Barack Obama
for President. Now that John Edwards is
out of the race, I am going to actively
support the Illinois Senator. I am firmly
convinced he is the person needed to
bring about the changes that are so
badly needed in Washington. I also
believe strongly that Senator Obama
will be an outstanding president. Its
quite evident that the winds of change
are blowing at a record clip all across
the land, and that this man is a breath
of fresh air on the political scene. I am
looking forward to his taking over the
leadership in our Nations capital.
Clearly, the Obama candidacy has
brought new hope to millions of
people in our country who have been
left out when it comes to decisionmaking in Washington. I talked at
length with the Senator before making
up my mind to get actively involved in
his campaign and was quite impressed.
I am convinced Senator Obama will
work for the programs put forward by
my friend John Edwards, and that was a
significant factor in my decision to join
the Obama team.
MONTGOMERY MAYOR BOBBY BRIGHT WILL

RUN FOR CONGRESS
Montgomery Mayor Bobby Bright
has announced that he will run for

Congress in Alabama. Bobby kicked off
his campaign in Ozark where he grew
up.The Second Congressional District
seat is a wide open race with no
incumbent.The district covers much of
southeast Alabama and stretches all the
way from Dothan to Prattville. Bobby,
who was one of 14 children raised on
a cotton farm near Ozark, was the first
in his family to go to college. He
became a lawyer and elected to work
in Montgomery. Bobby was elected
Mayor of Montgomery in 1999 and was
re-elected in 2003 and 2007. In my
opinion, Bobby has been an outstanding mayor and is very well liked by
folks in the River Region.
This will be a hotly contested race
with a large number of good candidates on the GOP side.Already running
as Republicans are State Senator Harri
Anne Smith, State Representative Jay
Love, State Representative David
Grimes, Dothan oral surgeon Craig
Scmidtke, Montgomery broadcasting
executive David Woods, and Dothan
businessman John Martin.
This will be a most interesting race
with a number of very good candidates. In fact, this may be the best
group of candidates in one race that I
have seen in years. Bobby will definitely be the Democratic nominee and
will face a strong GOP candidate in the
fall. However, at this juncture its impossible to figure out who is the strongest
of the GOP candidates. In any event, its
my opinion the Democrats have a very
good chance of taking this seat!
JOSH SEGALL RUNNING FOR CONGRESS IN

THIRD DISTRICT
Josh Segall, a Montgomery lawyer, has
announced he is running for Congress
in Alabamas 3rd Congressional District.
Josh will be a candidate for the Democratic nomination in the June 3rd primary
for the U.S. House seat currently held
by Republican Rep. Mike Rogers. Josh,
if elected, will work to create jobs to
replace those lost in the closing of
textile plants in the area.The Third Congressional District includes much of

east Alabama and stretches from Montgomery to Cherokee County in the
northeastern part of the state. Josh is
the son of my very good friend Bobby
Segall and if he is anything like his dad,
he would be a very good member of
Congress if elected. Mike Rogers, the
incumbent, will have the burden of
having to explain a number of his votes
and also will have to try and distance
himself from his close ties to the Bush
Administration. I have a hunch this race
may be much closer than some of the
political experts are predicting.
MRS. JOHNNIE CARR DIES AT AGE 97

Mrs. Johnnie Carr, who joined childhood friend Rosa Parks in the historic
Montgomery bus boycott and became a
prominent civil rights activist over the
past half century, died last month at the
age of 97. Mrs. Carr succeeded the Rev.
Martin Luther King Jr. as President of
the Montgomery Improvement Association (MIA) in 1967, a post she still held
at her death. It was the newly formed
MIA that led the boycott of city buses in
the Alabama capital in 1955 after Mrs.
Parks, a black seamstress, was arrested
for refusing to give up her seat to
whites on a crowded bus. Mrs. Carr was
a great lady and has been an inspiration
to folks across the country. She and I
became very close friends over the
years and I developed a tremendous
respect and admiration for her. Morris
Dees, co-founder of the Southern
Poverty Law Center, put it very well
when he discussed this ladys place in
history:
Johnnie Carr is one of the three
major icons of the Civil Rights
Movement: Dr. King, Rosa Parks
and Johnnie Carr. I think ultimately, when the final history
books are written, shell be one of
the few people remembered for
that terrific movement.
ago my oldest granddaughter, Sara

Beasley, interviewed Mrs. Carr for a
school assignment. Needless to say, the
videotaped interview was a real hit
back in Auburn. Nobody could believe
that Sara had actually met and talked
with a famous person like Mrs. Carr.
Sara, who is now a junior at Auburn
High School, says that meeting has had
a lasting effect on her. She will never
forget meeting with a great American
who holds a very special place in our
countrys history. To say that Mrs.
Johnnie Carr will be missed is an
understatement!
SPECIAL INTEREST LOBBYISTS HAVE A

VESTED INTEREST IN WHO WINS IN
NOVEMBER
The vast number of lobbyists supporting John McCain is staggering.This
tells me that the special interests who
control Washington dont want to lose
their grip on both the executive and
legislative branches of our national government.The powerful oil, pharmaceutical, and insurance industries have had
their gang of lobbyists hard at work for
the Arizona Senator. In addition to the
lobbyists who are bundlers for
McCain, there are a number of law
firms working hard on behalf of their
clients from these industries and they
are raising big bucks for McCain.
If regular folks are to have any say in
what happens in our nations capitol
over the next four years, they had best
back the Democratic nominee for president who I am firmly convinced will
be Senator Barack Obama. Interestingly,
the Illinois Senator has refused to take
any campaign money from lobbyists.
He is being financed by regular folks
who are giving small amounts to his
campaign. Unfortunately, the GOP candidate wont be able to say that.
Senator McCain has to depend on the
special interests and the 527 committees to furnish the money needed to
get his message out.
The Alabama Department of Environmental Management (ADEM) has fined

ExxonMobil $90,000 for a cloud of poisonous gas that washed over Dauphin
Island and sickened a number of residents. The penalty, which was said to
bring about new safety measures on
three of the companys Mobile Bay
natural gas platforms, was levied in a
consent order issued last month. ExxonMobil officials told the Mobile Press-Register that the company is working with
local emergency officials to improve
procedures.The giant oil company has
blamed the release of hydrogen sulfide
on a problem with a flare used to burn
the gas so that its no longer a threat.
Debris in a gas supply line apparently
caused the flare to go out and resulted
in unburned hydrogen sulfide being
released for several minutes.
Hydrogen sulfide, which has a rotten
egg odor, is a component of the
natural gas mined from beneath
Mobile Bay. Dozens of people reported
nausea and other problems on the
islands east end. Classrooms had to be
evacuated at the Dauphin Island Sea
Lab. Carolyn Wood, who is with the
Sea Lab, was glad ADEM issued a fine,
but she was disappointed that only
the ExxonMobil platforms would be
upgraded. She told the Press-Register
there are several other companies
with production wells near the island.
I agree with Mrs. Wood that all the
industry safeguards should be
upgraded. I also have to wonder why
the penalty was so small for a rather
serious and potentially dangerous happening. But, when you consider it was
ExxonMobil, an extremely powerful
and politically influential corporation,
I guess that answers my question.
Source: Mobile Press-Register
MERCK WILL PAY $671 MILLION TO SETTLE

MEDICAID OVERCHARGE CASES
Merck has agreed to pay a combined
total of $671 million to settle claims
On a personal note, about three years
ADEM FINES EXXONMOBIL $90,000 FOR

GAS RELEASE
that it overcharged Medicaid programs

for two big-selling drugs, Vioxx and
Zocor, and to resolve allegations of
improper marketing to doctors. Merck
paid improper inducements to doctors
to prescribe the cholesterol drug Zocor
and the painkiller Vioxx.The wrongdoing in this casewhich amounts to
fraudis the same sort of thing
AstaZeneca was doing in the case that
our firm tried last month in Montgomery. Merck was hiding the steep
discounts it gave to hospitals by reporting higher prices to the government.
From 1997 to 2001, Merck also gave
money and perks to doctors and other
health care professionals to entice
them to prescribe Merck drugs.This is
illegal under the federal laws. In a case
in Philadelphia, Merck agreed to pay
$399 million plus interest for improper
calculation of Medicaid rebates and its
marketing practices. In a Louisiana
case, it agreed to pay $250 million plus
interest for its rebate practices. The
Louisiana case involved pricing for the
heartburn drug Pepcid when it was
sold only with a prescription. The
Philadelphia case, which involved a
related Nevada action, involved pricing
programs for the cholesterol drugs
Zocor and Mevacor and the painkiller
Vioxx, which was pulled from the
market in September 2004. All states
with the exception of Arizona will
receive funds from the settlement and
that includes Alabama.
Source: Associated Press
II.
RECENT
SETTLEMENTS
BY FIRM
SETTLEMENT WITH FORD MOTOR CO. IN A
ROOF CRUSH LAWSUIT
Our firm recently settled a lawsuit
against Ford Motor Co. that involved
the roof on the 1991 Taurus which was
insufficiently designed.The lack of the
vehicles roof strength caused our

client to suffer serious head injuries
after his vehicle struck a cow on a dark
road in a rural Alabama county. Of
course, striking livestock and deer on
rural Alabama roads is not uncommon.
Fortunately, many vehicles that colide
with large animals absorb the impact
rather than failing like this Ford roof
did on this occasion.
What we discovered during our
investigation of this vehicle was tragic.
First, we were disappointed to learn
that Ford has not conducted a rollover
test on any vehicle, including the
Taurus, since 1974. In contrast, companies like Volvo, Mercedes, and Saab routinely conduct rollover testing, drop
testing, and even large animal impact
testing in an effort to determine how
the roof structures in their vehicles
perform with respect to occupant
injury potential.
Then, we learned that our clients
case was not unique. Ford has previously been sued because other innocent victims were seriously injured or
killed when a Ford roof collapsed after
striking an animal. On one occasion, an
eleven-year-old girl died while traveling
as a passenger in a 1992 Ford Taurus.
While the child was being taken to
school, her mother was unable to avoid
a horse. Upon impact, Fords weak roof
collapsed, killing the young girl.
Because Ford had not conducted
one single roof crush test on the
Taurus, other than slowly pressing
downward on a roof with a plate in
order to meet the minimum federal
requirement, we authorized our roof
crush expert to conduct testing. It
should be noted that the minimum
federal requirement does not in any
way represent what occurs in real
world crashes. In an effort to recreate
the forces involved in our accident, our
roof crush expert constructed a cow
dummy weighing 1800 pounds and
impacted several different Ford Taurus
roofs at various speeds until the
damage profile in the accident vehicle
was recreated.This enabled us to determine the amount of force experienced
by the accident vehicle. Our roof crush

expert then took a production Taurus
and internally strengthened the existing roof support structures. He then
impacted the reinforced vehicle with
the cow dummy at the same speed and
force that caused the damage to the
accident vehicle.The results of his tests
were astonishing.The cow dummy literally bounced off the reinforced
vehicle.The roof crush in the accident
vehicle was in excess of 16 inches.The
roof crush in the reinforced Taurus was
approximately one inch. Our client
would have walked away from the
accident had he been in the Taurus
with a properly designed roof.
We were able to establish that
strengthening the roof would have
cost Ford approximately $22 per
vehicle. Our roof crush expert pointed
out this was much cheaper in cost and
in weight than a luxury item such as a
sun roof. We learned that the Ford
Taurus did not meet Fords internal
requirements for roof strength.We discovered that after the accident vehicle
was manufactured, Ford further
reduced its internal roof crush requirements.This too was surprising until we
discovered an internal Ford memorandum. In that memo, the Chairman of
the Board and Chief Executive Officer
at Ford urged Ford engineers to
reduce costs related to items designed
to achieve or exceed compliance with
regulatory requirements to as low a
level as possible. In essence, he was
urging Ford engineers to design down
to the lowest possible safety level
which would still allow Ford to legally
sell vehicles. This is another classic
example of a company placing profits
over safety. The case was settled just
before jury selection for a confidential
amount. Graham Esdale and Cole Portis
from our firm and Robert Thompson
from Tuskegee handled the case and
did a very good job.
VERDICT IN DEATH CASE IN GREENWOOD,

MISSISSIPPI
Plaintiffs Brian Raines and Eric
Raines filed a wrongful death case in
2002 against Defendants Cecil Higgerson and Kittle Heavy Hauling, Inc. in
Leflore County, Mississippi. Defendants
negligently failed to properly secure a
load of pipes and failed to use chocks
on the pipes, causing the death of the
plaintiffs father, Michael Raines. Mr.
Raines, who was 51 years old at the
time of his death, worked for Inland
Dredging Company. He was a licensed
captain and had worked as a tender
boat operator since the 1970s.
However, he was working in a difficult
capacity at the time of his death. Inland
Dredging Company had a verbal contract with Kittle Heavy Hauling to load
and transport large dredging pipes
from Sardis to Greenwood.These pipes
were approximately 36 inches in diameter, 48 feet long and weighed 1,5001,800 pounds. Kittle Heavy Hauling, a
trucking company, operated out of
Henagar, Alabama. Cecil Higgerson, an
employee of Kittle Heavy Hauling, was
the driver hauling the load of pipes.
On October 31, 2001, the driver had
made 2 previous trips to Greenwood
hauling pipes without any problems.
On the last load, a Kittle employee
used the Kittle crane to place 16
dredging pipes on to the trailer owned
by Kittle in Sardis. The pipes were
stacked 4 per layer with 4 layers of
pipe.Also, 4x4 timbers were placed on
some pipes, but the load of pipes had
no chocks. As you probably know, a
chock is a wooden triangular wedge
that is nailed to the 4x4 timber.
Without a chock, the pipes can shift
and can roll off the trailer. Chains and
straps were in place on this load, but
according to expert witness testimony,
those chains and straps wont prevent
the pipes from shifting and dont
prevent pipes from rolling off the
trailer at the loading site or upon
arrival at the Greenwood site when
preparing to unload. It was undisputed
that Mr. Raines and the other Inland
workers were not unloading these

pipes when the pipe fell on Raines.
They were actually assisting the truck
driver by unhooking the chains and
removing the straps and chains from
the top layer of pipes before they
could unload and take the pipes off of
the trailer. Mr. Raines had gathered the
chains and given them to the truck
driver. Both Mr. Raines and the truck
driver were on the drivers side of the
truck.After the last chain from the top
layer of pipe was unhooked from the
trailer, a pipe fell off the trailer, hit Mr.
Raines, causing his death.
Kittles own policies and procedures
required that their drivers use chocks
on a load of pipes such as this load.The
Kittle drivers were required to use
chocks which they understood. Kittle
had instructed their drivers to use
them. The vice president of the
company testified at trial that chocks
were available to their drivers for use at
the Sardis site.The Inland workers testified at trial that none of the loads of
pipe hauled by Kittle for Inland had
chocks on them.
Dr. Charles Benedict, who is a professional licensed engineer, was accepted
by the Court as an expert witness. He
testified on behalf of Plaintiffs at trial
that a load of pipes like this load must
have chocks nailed to the 4x4 to properly secure the pipes and to prevent
the load of pipes from shifting or
rolling. Dr. Benedict is familiar with the
customs in the trucking industry and
has been familiar with those customs
from the 1960s to the present. The
custom in the trucking industry is that
a load of pipes like this one should be
chocked. At trial, Dr. Benedicts testimony was undisputed. In fact, Kittles
lawyers hired a trucking expert, but
could not call him to testify at trial.
Based on the industry standards and
his education, training and experience,
Dr. Benedict testified that Defendants
breached the standard of care by
failing to properly secure the load of
pipes and by not using chocks. Dr.
Benedict also testified to the ultimate
issue in this casethat Defendants
failure to chock the load of pipes

caused the pipe to roll off of the trailer
and caused Mr. Raines death. The
Defendants did not dispute Dr. Benedicts testimony.
An economist, James Koerber, was
accepted by the court as an expert
witness and testified at trial concerning the economic loss suffered by the
estate of Michael Raines and his two
sons. Mr. Koerber testified as to the loss
of future earning capacity of Mr.
Raines. His testimony was also undisputed by Defendants.
After selecting a jury in Leflore
County, Mississippi, on March 4, 2008,
the case was tried for several days.The
jury returned a verdict in favor of Plaintiffs for $850,000. Since Mississippi is a
comparative negligence state, the jury
apportioned some fault to Kittle Heavy
Hauling and some fault to Inland. The
case was tried for the plaintiffs by Julia
Beasley and Navan Ward, Jr. of our firm
and Charles J. Swayze, Jr. and Charles J.
Swayze, III, of Whittington, Brock &
Swayze, P.A, from Greenwood, Mississippi.They did a very good job and got
a good result under Mississippi law for
their clients.
III.
LEGISLATIVE
HAPPENINGS
REGULAR SESSION STARTS WITH A FLURRY
OF ACTIVITY
During the first weeks of the Regular
Session, there has been a pretty good
bit of activity in both the House and
Senate.As usual, the House has been the
more active, but the Senate hasnt been
too bad thus far. It appears a bill
banning PAC-to-PAC transfers will eventually make it through this time. The
Senate passed the House bill with
changes, but the changes were rejected
by the House.The bill was sent to conference, which means a conference
committee will be required to work out
a good bill.While media reports havent
been too kind to the Senate so far, I am

hopeful the Senators will put aside
political differences and have a good
session.
THE BISHOP-BARRON RESOLUTION

I must confess that a number of folks
were looking forward to round two of
the Bishop-Barron battle as a carryover from last years debacle. However,
it appears cooler heads prevailed and a
showdown between the two elderly
senators was averted. Senator Bishop
made a public apology for his actions
and I understand the Jasper lawmaker
also made a personal apology to
Senator Barron. Hopefully, there wont
be any more of the sort of thing that
has been described as a public disgrace and which brought universal
ridicule to the state.There is too much
important work that needs to be done
for the Senate for its members to
spend any more time fighting on the
Senate floor. My intention is to never
mention it again in any future issues of
this Report. I hope that time will
soften the bad image created last year
as a result of an irresponsible act.
ALABAMA LEGISLATURE WONT WORK ON

BUDGETS UNTIL AFTER EASTER
The Chairmen of the Legislatures
budget committees have postponed
work on the two state budgets until
later this month or early April. Normally, work starts much earlier, but
because of the uncertainly relating to
fiscal forecasts the delay seems to be a
good idea. Much depends on how tax
collections will fare during the economic slowdown. So far during this
fiscal year, the states sales tax collections are flat and the individual income
tax collections are growing less than
1%. House budget committee Chairman
John Knight says his committee should
take up the General Fund budget after
the Legislatures Easter break.
Senate Budget Committee Chairmen
Hank Sanders and Roger Bedford said
they will wait until April for the Education and General Fund budgets in the
Senate.The two Senate chairmen said
they hope to have a better picture by
then whether big cuts will be necessary for some programs. The budgets
must be finished before the legislative
session ends in mid-May. Hopefully, the
economic woes caused by the Bush
Administrations irresponsible fiscal
policies and the uncontrolled spending
that resulted wont cause our state to
suffer to any great extent. However, the
economic downturn could result in the
cutting of good and badly needed programs.These would include both education programs and those programs
funded out of the general fund budget.
ATTORNEY GENERAL PROPOSES TOUGHER

LAW AGAINST DRINKING AND DRIVING
Alabama Attorney General Troy King
has proposed legislation to toughen the
law against people who drink alcoholic
beverages and then drive. The bill
would increase the sentences for violators and would make some DUI offenders install interlocking devices in their
cars so the vehicle would not start until
the driver passed an on-the-spot breathalyzer test.The Attorney Generals proposal would remove a loophole from
the states current DUI law.The Alabama
Court of Criminal Appeals ruled in September that the four convictions that
raise a drunken driving sentence from a
misdemeanor to a felony must be
within a five-year period. The ruling
struck down a long felony sentence for
a motorist who had seven DUI convictions within 15 years, but only three
within a five-year period.The new law
would make it clear that drunken
driving is a felony after four convictions
with no exceptions. For third-time
offenders, the bill would allow the
judge to require the offender to install
the ignition interlock device. Drivers
must blow into the device and the car
wont start if the driver is intoxicated.
MINIMUM LIMITS BILL PASSES

The House of Representatives has
passed a bill that will bring Alabama in
line with about half the South by
raising the minimum amount of automobile liability insurance that
motorists must buy. The House voted
82-0 for legislation by Rep. Marc
Keahey, D-Grove Hill, that would
require motorists to carry $25,000 in
coverage for a single injury or death,
$50,000 for multiple injuries or deaths,
and $25,000 for property damage.The
current minimum limits under
Alabamas mandatory insurance law
are $20,000, $40,000 and $10,000,
respectively. Rep. Keaheys bill now
goes to the Senate, where an identical
measure by Sen. Roger Bedford was
previously passed by a vote of 33-0. For
the higher requirements to become
law, Keaheys bill must pass in the
Senate or Bedfords bill must win
approval in the House.
The proposed new minimums would
bring Alabama in line with the insurance requirements in Arkansas,
Georgia, Mississippi, South Carolina and
Texas.Tennessee,Virginia and Kentucky
have the same limits for injuries and
deaths but smaller amounts for property damage. Florida and Louisiana have
lower amounts across the board, and
North Carolinas minimums are higher
for injuries and deaths than those proposed for Alabama, according to the
Insurance Information Institute.
While passage of this legislation
would be a good thing, it is grossly inadequate.A serious motor vehicle accident
resulting in severe disabling injuries
would obviously involve medical bills
alone that would greatly exceed the
amount of available insurance. The
answer is for persons who have liability
insurance to purchase uninsured
motorist coverage in the largest amount
possible from their insurance carrier.
The premiums for higher uninsured
motorist coverage is fairly inexpensive.
Uninsured motorist coverage is optional
in Alabama. It kicks in when the driver
at fault in an accident has no insurance
or too little insurance to cover all the

damage.A study released last year by the
nonprofit Insurance Research Council
showed that 25% of Alabama drivers
lacked insurance between 1999 and
2004.That tied Alabama with California
for the second-highest percentage of
uninsured drivers. Mississippi was first.
While passage of the minimum limits
bill sounds good, increasing the uninsured motorist coverage is the real
answer when it comes to protecting
insured drivers.
involves random drug tests 10 to 12

times monthly to make sure participants stay off drugs. By this time next
year, the Chief Justice Cobb predicted
she would be able to report a decline
in Alabamas prison population
without compromising public safety.
Everybody concerned should agree
that the court system in Alabama must
be adequately funded. To make that
happen, the legislators should meet
the systems needs with an increase in
the governors proposal.
IV.
COURT WATCH
STATE OF ALABAMA APPEALS A PORTION

OF THE EXXON CASE
CHIEF JUSTICE WARNS OF LAYOFFS IN

COURTS
Chief Justice Sue Bell Cobb says the
state court system will have to lay off
employees until the system gets a
budget increase. The courts in
Alabamas 67 counties are getting a
state appropriation of $155.8 million
this year to pay judges, court clerks,
juvenile probation officers and other
employees. All but $3 million of the
appropriation is going for salaries and
benefits, according to the Chief
Justice, who heads Alabamas court
system. For the new fiscal year beginning October 1st, the chief justice had
sought an increase to $174 million,
but Governor Bob Riley has recommended $156.9 million, which is just
about level funding.
Chief Justice Cobb was the first chief
justice invited to give a State of the
Judiciary speech to a joint session of
the Legislature since Chief Justice
Sonny Hornsby in 1989. The Chief
Justice reported that judges are trying
to help ease the growing number of
state prisoners by developing drug
courts and using community corrections. Both programs keep nonviolent
offenders out of prison by letting them
remain in their communities with
intensive monitoring. Drug court also
ExxonMobil has paid a total of

$121,511,231 to the State of Alabama
,which represents most of what the
powerful oil giant owed the state after
the Alabama Supreme Court took away
all of the punitive damages. Now the
State is appealing the trial judges
ruling on a portion of the compensatory damages to the Supreme Court in
an effort to recover the additional
$21.3 million we contend Exxon still
owes the State. We believe that on
appeal this ruling will be in the States
favor. The additional amount due is
actually from a 12% penalty that is
required to be paid on unpaid royalties.
Exxon had taken the position that this
was a penalty and not interest, that is,
that was the companies position prior
to the last hearing.Their position had
changed by the time the hearing was
held.What had been termed a penalty
by ExxonMobil all of a sudden became
interest.
ALABAMA SUPREME COURT FINALLY DOES

THE RIGHT THING
The Alabama Supreme Court finally
corrected a grievous wrong that had
been done by the high court. As a
result, persons like the late Jack Cline
will now be able to have their day in
court.As you know, Jack Cline was literally poisoned on the job and the
company that made the toxins that

killed him should have been held
responsible.Although the result in the
recent case wont affect the Cline
family, at least according to a report in
the Birmingham News the court
fixed the Cline problem. Regardless
of how some of the justices really
feelhad it not been for Jack Cline
the recent decision by the divided
court would never have happened. Fortunately, a majority of the justices on
the Supreme Court finally stood up
against the power and influence of the
big business lobby in Alabama. As you
will recall, Jack Cline died of myelogenous leukemia in January after a long
and unsuccessful battle to have the
facts of his case heard by a jury. He
fought for justice up until he died, and
in my opinion this man was a true
American hero.
In the recent case, five members of
the courtChief Justice Sue Bell Cobb
and Justices Champ Lyons Jr., Tom
Woodall, Tom Parker and Glenn
Murdockvoted to overturn decades
of precedent that made it virtually
impossible for Alabamians sickened by
toxins to have their cases heard by a
court and jury.This decision overturns
one of the worst rules of law ever to
have existed in our state. Now a wrongful death lawsuit that a trial judge had
barred on grounds that the plaintiff
waited too long to file suit will go
forward.
The 5-4 decision will allow Alabamians exposed to toxic chemicals after
January 25, 2006, to sue the manufacturers if they become ill in the future,
but it will not apply to thousands of
people who were last exposed before
that date. Birmingham lawyer Bob
Palmer, who represents the plaintiff in
the case, a widow of a Tuscaloosa man
who died from a rare form of leukemia,
observed after the court ruled:
Denial of justice to anyone is not
justice. ... Its a victory, but its not
a complete victory.
Bob is correct, the job isnt finished.
The Alabama Legislature should
promptly pass the legislation required

to complete the job that Jack Cline
started. Hopefully, the Jack Cline Bill
will soon become law. To make sure
that happens, our Alabama readers
should contact their Senators and
House members and ask for their help
in completing the work started by Jack
Cline and carried on by his family and
his dedicated lawyer after Jacks death.
When that happens, it will be a fitting
memorial to Jack Cline.
Source: Birmingham News and Associated Press
OREGON HIGH COURT REAFFIRMS $79.5

MILLION AWARD IN PHILIP MORRIS CASE
The Oregon Supreme Court has
again affirmed a $79.5 million punitive
damages judgment against Philip
Morris, an award twice struck down by
the U.S. Supreme Court, which suggested it was excessive.The award was
for the family of Jesse Williams, a
former Portland janitor who started
smoking during a 1950s Army hitch
and died in 1997 six months after he
was diagnosed with lung cancer.A jury
in Portland made the award in 1999.
This is the third time the state court
has ruled.
The Oregon court ruled that Philip
Morris and the tobacco industry
worked during the 1950s on a
program of disinformation to create
doubt about the dangers of smoking.
The latest ruling followed a decision by
the U.S. Supreme Court last year to
send the case back to Oregon. That
states Supreme Court was told to
reconsider the award based on its decision about instructions for the trial jury
that Philip Morris had proposed and
the trial judge rejected. The Oregon
high court said there were other
defects in the instructions violating
Oregon law, that justified the trial
judges decision.
For example, the Oregon court said
that the instructions Philip Morris suggested would have forbidden the jury to
consider the profits the tobacco
company made through misconduct
that was not illegal. The latest Oregon

Supreme Court decision didnt take
issue with the U.S. Supreme Court on
another point it raisedthat Oregon
courts couldnt allow jurors to use punitive damages to punish a defendant for
harm done to anybody who wasnt part
of the suit. Philip Morris will apparently
appeal the ruling to the U.S. Supreme
Court.
The Oregon high court made its first
decision in 2002, refusing to hear an
appeal from Philip Morris. Then the
U.S. Supreme Court rejected the judgment of nearly $80 million, saying that
punitive damages generally should be
held to no more than nine times actual
economic damages. It declined,
however, to make that a firm rule. In
the Williams case, the family was
awarded $521,000 in actual damages.
The punitive damages are about 150
times greater. The Oregon Supreme
Court upheld the punitive damages,
citing extraordinarily reprehensible
conduct on the part of Philip Morris
officials. Then came the U.S. Supreme
Courts second look at the case. On
that appeal, a narrower ruling resulted
that did not address the size of the
award, but only how juries could consider the conduct of defendants in
determining punitive damages. It will
be interesting to see what the highest
court in the land will do on this cases
next trip up on appeal.
JUDGE REDUCES DAMAGES AWARDED IN

FUNERAL PROTESTERS CASE
A federal judge in Baltimore has
upheld the October jury verdict in the
lawsuit brought against a Kansas-based
fundamentalist church group for its
anti-gay protest at the 2006 Maryland
funeral of a Marine killed in Iraq. The
judge reduced by more than half the
total amount of damages awarded to
the plaintiff, the Marines father. The
decision means the Topeka-based Westboro Baptist Church and three of its
members must pay total compensatory
and punitive damages of $5 million for

emotional distress and invasion of
privacy. The original jury award was
$10.9 million.The appeal by Westboro
to overturn the verdict is still pending.
Westboro members believe U.S. deaths
in Iraq are punishment for the nations
tolerance of homosexuality.
USS COLE FAMILIES SEEK REHEARING OF

THEIR LAWSUIT
Family members of the 17 sailors
killed in the 2000 attack on the USS
Cole in Yemen are trying to use a new
federal law to reopen their lawsuit
seeking more than $100 million in
damages from Sudan. In a ruling last
year a federal judge found that Sudan
provided training and logistics allowing
al-Qaida terrorists to bomb the Navy
destroyer. But, although U.S. District
Judge Robert G. Doumar ordered Sudan
to pay about $8 million for lost wages
and earnings potential, he said he was
prohibited by law from awarding the
families money for pain and suffering.
The families are asking Judge
Doumar to reopen the case. It appears
that the Justice for Victims of StateSponsored Terrorism Act, which
became law on January 28th and allows
terrorism victims to seek punitive
damages for pain, suffering, and emotional distress, favors the plaintiffs position.This law provides relief for certain
older terrorism-related cases, such as
the one involving the Cole, as well as
new cases. But interestingly, it prohibits
suits involving Iraq, and thats sort of
hard to figure out.
The families lawyers want to get the
$8 million from U.S. banks that hold $60
million in Sudanese assets. The banks
take the position that the U.S. government has frozen the assets. Fifty-nine
family members sued, and 24 spouses,
children, and parents of unmarried
sailors were awarded amounts ranging
from $104,000 to $781,000. If Judge
Doumar grants the request to reopen
the case, all of the plainitffs could be eli-
gible for payment. I hope justice will be

done.
AN APPEALS COURT OVERTURNS TRAVELERS

$500 MILLION ASBESTOS SETTLEMENT
A federal appeals court has overturned a $500 million settlement
reached two years ago by The Travelers.
Cos. Inc. This ruling could result in
more lawsuits being filed against the
company.The ruling by the U.S. Court
of Appeals for the Second Circuit
vacated a March 2006 decision of the
U.S. District Court for the Southern District of New York.The 2006 settlement,
which arose from the settlement of
asbestos claims arising out of a suit by
Denver, Colorado-based Johns-Manville
Corp., is subject to final court approval.
Travelers insured Manville, which filed
for bankruptcy in 1982, while it made
and sold asbestos from the 1940s to the
1970s.Travelers says it will not adjust
the level of its asbestos reserves as a
result of the Second Circuits decision.
It will be interesting to see how this
latest development plays out.
Source: Insurance Journal
JUDGE ALLOWS CLASS ACTION HOT FUEL

LAWSUIT TO PROCEED
As the result of a federal judges
ruling, a class-action lawsuit against U.S.
oil companies for not adjusting gasoline prices or volume for temperature
will go forward. U.S. District Judge
Kathryn Vratil, hearing lawsuits from
across the country consolidated in her
court in Kansas City, Kansas, rejected a
motion by the oil companies to dismiss
the lawsuit. In doing so, the judge said
the defendants had not explained how
their arguments, even if accepted,
would preclude the plaintiffs claims.
The lawsuitsfrom 26 states, Guam,
and the District of Columbiacontended that customers can be
deceived, shortchanged, or both
because motor fuel is sold by volume
and not adjusted for temperature. At
10
the longtime industry standard of 60

degrees, the 231-cubic-inch U.S. gallon
puts out a certain amount of energy.
But fuel is often sold at much higher
temperatures, causing the fuel to
expand and the amount of energy to
decline for each gallon dispensed. Consumers nationwide annually paid an
estimated $2.3 billion more than they
otherwise would have to because the
year-round average fuel temperature
was nearly five degrees higher than the
nationwide standard.
The lawsuits have more than 100
defendants, including major oil companies, distributors, and fuel retailers.The
plaintiffs include everyday consumers,
truckers, and small businesses. While
this court order was most significant,
the judge was simply following the law.
Bob Horn, a very good Kansas City
lawyer, is a co-lead counsel in this litigation. We will continue to monitor
further developments in this case since
we are actively involved the litigation.
Rhon Jones is the lead lawyer for our
firm in the cases.
Source: Kansas City Star
JUDGE UPHOLDS $196.2 MILLION AWARD

AGAINST DUPONT
A West Virginia State circuit judge
has upheld a $196.2 million punitive
damages award against DuPont in the
class action pollution case that we
wrote about recently. In his order,
Judge Thomas A. Bedell also ordered
the Wilmington, Delaware-based
chemical giant last month to set aside
nearly $130 million for a medical
monitoring plan. Judge Bedell said the
plan would be operated on a pay-asyou-go basis, but DuPont must put the
total amount in an escrow account.
The jury in the case required DuPont
to provide medical monitoring for 40
years to people who were exposed to
arsenic, cadmium and lead from a
former zinc-smelting plant in the
small community of Spelter.
Judge Bedell appointed Ed Gentle, a
Birmingham, Alabama lawyer, as
administrator of the medical monitoring plan. As you may recall, ten residents of Spelter sued DuPont in 2004,
claiming the company deliberately
misled them about health risks from
the pollution and delayed a site
cleanup for as long as possible to
maximize profits. The lawsuit was
tried last year in four phases involving property damage claims, longterm health screenings, and corporate
accountability. Jurors awarded the
punitive damages in October in the
trials fourth phase. In the other
phases, the jury required medical
monitoring and found DuPont liable
for negligence in creating the waste
site. Jurors also found that DuPont
had created a public and private nuisance and that its pollution trespassed onto private property. DuPont
plans to appeal.
ALABAMA SUPREME COURT ATTEMPTS TO

RESTRICT WHERE A PRODUCTS CASE MAY
BE FILED
There have been two recent opinions by the Alabama Supreme Court
that have not gained much media
attention, but have had a significant
impact on the rights of the injured and
disabled in Alabama. Ex parte Suzuki
Mobile, Inc. and Ex parte Volvo Trucks
North America, Inc. are significant
because the Supreme Court has
attempted to severely restrict where
injured parties can file a product liability case in Alabama. Before these decisions, it was generally understood that
the location of where the injury
occurred was a proper basis for establishing venue in the county.This understanding was based upon the plain
language of Alabamas statute governing venuein the county in which a
substantial part of the events or omissions giving rise to the claim
occurred. It was assumed by plaintiff
and defense lawyers that parts of the
events giving rise to the claim were
the injury and the causation, i.e., the
defect causing the injury. Without

injury and causation, there is no claim,
and the injury and causation occur
where the accident happens. Despite
this, the Alabama Supreme Court held
that it is the wrongful acts of the corporate defendant that determine
venue under this statute.
In the case, the plaintiffs son was
seriously injured in an accident in
Choctaw County while operating an
ATV.The plaintiff sued Suzuki, the manufacturer of the ATV, and the dealership
where it was purchased, alleging the
ATV was defectively designed.The suit
was filed in Choctaw County where
the accident occurred.The dealership
was located in Mobile County, and the
defendants filed a motion to transfer
venue to Mobile County.The trial court
denied the motion, and the defendants
petitioned for a writ of mandamus
asking the Alabama Supreme Court to
transfer the action.
The Supreme Court held that, even
though the injury occurred in Choctaw
County, venue was actually proper in
Mobile County, where the dealership
was located.The Court determined that
while the location where the injury
occurred used to be a dispositive fact,
the July 1999 amendment to the statute
focused the inquiry on the location of
the events or omissions giving rise to
the claim. The Court reasoned that,
because the Plaintiffs complaint
alleged the wrongful acts occurred in
the design, manufacture, assembly, distribution, and sale of the ATV, none of
which occurred in Choctaw County, it
could not be a proper venue.
This ruling was further clarified in
the Volvo case. On October 12, 2005,
Joseph Freeman, Jr., who was
employed by Evergreen Forest Products, was driving a 2004 Volvo tractor
trailer. Although he was obeying the
speed limit and operating his truck in
a safe manner, an oncoming pickup
truck crossed over the center line of
the highway and struck Freemans
Volvo truck near the driver side front
tire. As a result of the collision, and
despite wearing his seatbelt, Freeman
was ejected through the windshield

onto the pavement. He survived at the
scene, but later died as a result of his
injuries.
Freemans daughter filed suit against
Volvo and the dealership who sold the
truck in Montgomery County, for a
defective seatbelt.The defendants filed
a motion to transfer the case to Butler
County on the basis of forum non conveniens because the accident occurred
there and because it would be more
convenient to the witnesses. The trial
court denied the motion and the defendants filed a petition of mandamus
with the Supreme Court. In analyzing
the issues, the Supreme Court first
noted that, in order to transfer the case
to Butler County, that county must be a
proper venue.Applying the rationale of
the Suzuki case, the Court determined
that Butler County was not a proper
venue for the action because none of
the wrongful acts of the corporate
defendants in designing, manufacturing, and selling the truck and its defective seatbelt occurred there.The Court
agreed with the Plaintiff and found that
Montgomery County was the proper
venue because the sale of the defective
seatbelt occurred there.
These opinions seem to run counter
to the underlying premise of Alabama
law that it is in the interest of justice
for a suit to be filed in a county with a
strong connection to the action. The
Supreme Court has stated:
The key factors concerning the
interest of justice that clearly
apply in this case are the burden
of piling court services and
resources upon the people of a
county that is not affected by the
case and, perhaps most basic of
all, the interest of the people of a
county to have a case that arises
in their county tried close to
public view in their county.
Ex parte Smiths Water & Sewer
Authority, 2007 WL 2687396 (Ala. Sept.
14, 2007).
Yet, with the new interpretation of
the venue statute, a county having no

connection to the accident, the injured
victim, or even to the defendant who
designed and manufactured the
product is now a proper venue simply
because the large corporation has an
unrelated dealership or an agent in the
county. Now one can envision that
product cases will begin to pile up in
the counties with larger cities in them
because that is where the corporate
defendants usually have dealerships.
Yet, the county where the death or
severe injury occurred, where the
claim arose, and where the of the
county have the strongest interest in
not having defective products injure or
kill their residents, will no longer be
considered a proper venue.That seems
to be a real change from well-settled
venue case law in our state.
A FORMER SUPREME COURT JUSTICE

SPEAKS OUT
Sandra Day OConner, who served
with distinction on the U.S. Supreme
Court, had some interesting observations recently relating to our court
system. The justices comments were
printed in a recent story in Parade magazine. I believe you will find her astute
observations to be not only interesting,
but extremely thought-provoking.
HOW TO SAVE OUR COURTS

In my work as a Supreme Court
justice, I was required by the Constitution to fairly and impartially
apply the law-not the law as I
wanted it to be but the law as it
was. Now, as a private citizen, I
am anxious about the state of the
judiciary in America.
I am not concerned about particular judges or cases, nor am I concerned about the judiciary shifting
right or left.What worries me is the
manner in which politically motivated interest groups are attempting to interfere with justice.
11
The rule of law in the U.S.

includes statutes and constitutional provisions. It also involves
precedent, which is a previous
judicial ruling on a matter. A
judge typically defers to precedent. Like good cooking, good
judging requires taking ingredients and procedures used successfully in the past and adjusting
them to the case at hand. New
legal recipes-or rules-can have
major ramifications. So if a judge
comes up with a new way to
apply the law, her opinion may
be reviewed by state or federal
appellate courts to ensure that it
is a correct interpretation of the
law. If its not, its overturned.
Thus, our judicial system has
safeguards to ensure consistency
and preservation of the law. But it
is threatened when judges ignore
settled law and make decisions
according to personal or public
preferences.
The judiciary currently is experiencing unprecedented pressure
from interest groups to make
decisions that are based on politics. In Washington, D.C., we hear
a lot about federal judges, and
they have a critical role in
upholding the Constitution. But
having been a state judge and a
state legislator, I know that the
vast majority of law is state law.
Ninety-five percent of litigation
takes place in state courts. Many
legal issues are primarily decided
there, including divorce, property
rights, employment law, product
liability and medical malpractice.
Political pressure is a big problem
in a number of our state courts.
More than 89% of state judges go
through some form of election
process. Many of these elections
recently have become full-fledged
political battles, fueled by
growing sums of money spent by
candidates and special-interest
12
groups to attack, defend and

counterattack.
The money can be spent in polarizing ways. When Bill Cunningham was running for the
Kentucky Supreme Court in 2006,
one opposing campaign ad
implied that he was responsible
for letting six rapists out on
parole. It said:One had been on
parole for only 12 hours when he
raped a 14-year-old and made her
mother watch.
This story was very misleading.
Cunningham, then a lower-court
judge, did rule to change the sentences of several rapists from life
without parole to life with the
possibility of parole, but these
men all stayed in jail. And the
rape referred to in the ad
occurred 20 years earlier, before
Cunningham was even a judge.
Sue Bell Cobb remembers speaking to a reporter the day after
she won the election for chief
justice of the Alabama Supreme
Court in 2006. Chief Justice Cobb
expected to be asked how it felt
to be the first woman in that job.
Instead, the reporter asked:How
does it feel to be the victor of the
second most expensive judicial
race in U.S. history? How will
you convince the people of
Alabama that the campaign contributions you sought will not
impact how you rule? How can
we convince people their courts
are not for sale?
I imagine she answered much like
Illinois Supreme Court Justice
Lloyd Karmeier did after he won
the most expensive judicial election in American history in 2004.
That race cost the candidates $9.3
million, a sum greater than what
was spent in more than half of the
U.S. Senate races that year.
Karmeier said of the money:
Thats obscene for a judicial race.
What does it gain people? How

can anyone have faith in the
system?
Good questions. When so much
money goes into influencing the
outcome of a judicial election, it is
hard to have faith that we are
selecting judges who are fair and
impartial.If I could do one thing to
solve this problem, it would be
to convince the states that select
judges through partisan electionsthat is, when a Democrat and
Republican run against one
another-to switch to merit selection
instead. Under this plan, currently
used in states such as Colorado
and Nebraska, an independent
commission of knowledgeable citizens recommends candidates to
the governor, who appoints one
of them as judge. After several
years on the bench, the judges
name is submitted to the electorate, who vote on whether he
should keep his position. This
method decreases the importance
of money and politics in the
process while still allowing voter
input on retaining each judge.
I believe the long-term solution to
the politicization of the judiciary
process is education. Children,
voters, policymakers and lawyers
all should be informed about the
importance of a fair, impartial
judiciary. Judges should write
their opinions in plain English so
that the public can understand
what the law is.
You also should educate yourself,
an especially important task if
you live in one of the 39 states
that holds elections for judges.
Take these steps:
First, learn about the candidates. That you agree with a
persons policy positions is irrelevant to whether he or she
would make a good judge. Evaluate them based on their
ability to be fair, impartial and

competent. Look for unbiased
sources-many states offer voter
guides and performance evaluations.
Second, be suspicious if a candidate makes a promise about
how he or she would rule in a
particular case. Every case is
different and should be judged
according to how the law
applies to that situation. If a
judge decides a case based on a
campaign promise, he or she
has not upheld the pledge to be
fair and impartial.
Third, vote. Judicial elections
tend to garner little attention.
This is increasingly problematic,
because interest groups often
can be the main source of information. The only way to counteract this is to research the
candidates, know where your
information is coming from
and vote.
Im working with Georgetown
University and Arizona State University on two programs on this
subject. One is called Our Courts
and will be an online civics experience for children. Theyll be able
to step into a judges shoes so they
can better understand what he or
she does. The other program, the
Sandra Day OConnor Project on
the State of the Judiciary, will
create a dialogue between experts
and law practitioners on the
court system and report on the
best ways to safeguard its role.
I hope I can make a lasting contribution to protecting our courts.
We must preserve our system of
government, a system for which I
have the utmost respect as I
reflect back on my Supreme Court
career.
Justice Sandra Day OConner
Parade Magazine
February 24, 2008
V.
THE NATIONAL
SCENE
LOCATING THE TRUTH IN THE BUSH WHITE
HOUSE IS VERY DIFFICULT
If you want to hide the truth from
the American people, some say the
best place to put it is in the Bush
White House. It has been widely
reported that President Bush and his
top aides publicly made 935 false
statements about the security risk
posed by Iraq in the two years following the tragic events of September 11,
2001. A study released by two nonprofit journalism groups indicates that
the Bush Administration led the
nation to war on the basis of erroneous information that it methodically propagated and that culminated
in military action against Iraq on
March 19, 2003. The study was conducted by the Center for Public
Integrity and its affiliated group, the
Fund for Independence in Journalism.
While a report of this sort would,
under normal circumstances, be big
news, its just another day at the office
with the Bush Administration.
According to the study, President
Bush and seven top officialsincluding among others,Vice-President Dick
Cheneymade 935 false statements
about Iraq during those two years.
The study was based on a searchable
database compiled of primary
sources, such as official government
transcripts and speeches, and secondary sourcesmainly quotes from
major media organizations.The study
says the President made 232 false
statements about Iraq and former
leader Saddam Husseins possessing
weapons of mass destruction, and 28
false statements about Iraqs links to
al Qaeda. The quotes in the study
include an August 26, 2002, statement
by Vice-President Cheney to the
national convention of the Veterans of
Foreign Wars.Typically, the Vice-President claimed:
Simply stated, there is no doubt

that Saddam Hussein now has
weapons of mass destruction.
There is no doubt he is amassing
them to use against our friends,
against our allies, and against us.
The American people are looking
forward to a time when the President
of our country and his team of advisors
will simply tell them the truth.We have
had seven years of the Bush Administrations deception and its clearly time for
change. I believe the current political
climate is the direct result of folks
losing confidence in an Administration
that has played fast and loose with the
truth and has favored the rich and powerful while totally ignoring the wants
and needs of regular folks.
Source: CNN
EXXONMOBIL ANNOUNCES RECORD PROFITS

ExxonMobil Corp. set another record
when it posted the largest annual profit
by a U.S. company$40.6 billionand
thats bad news for folks in this
country. It means that regular folks and
business owners have made this possible.The worlds largest publicly traded
oil company is profiting while people
who are buying their gasoline at the
pump are hurting. Exxon also set a U.S.
record for the biggest quarterly profit,
posting net income of $11.7 billion for
the final three months of 2007, besting
its own mark of $10.71 billion in the
fourth quarter of 2005. The previous
record for annual profit was $39.5
billion, which ExxonMobil reported for
2006.This politically powerful corporation uses its political muscles and influence to pretty much get its way. Having
Dick Cheney in a position of power
certainly hasnt hurt the oil companiesincluding ExxonMobiland that
is a gross understatement.
13
BUSHS FRAUD CRACKDOWN ON FRAUD

COMES WITH A LOOPHOLE
Its really hard to visualize the Bush
Administration ever really cracking
down hard on corporate fraud. What
was being touted as a major effort, an
Administration proposal to force companies to report abuse of taxpayer
money actually has a multibillion-dollar
loophole. Interestingly, the plan wont
apply to work done overseas, including
projects to secure and rebuild Iraq and
Afghanistan. I suspect that loophole
makes bosses at companies like Halliburton rest a whole lot easier. For
decades, contractors have been asked
to report internal fraud or overpayment on government-funded projects.
Compliance has been voluntary, and
over the past 15 years the number of
company-reported fraud cases has
declined steadily.
Now, the Justice Department wants
to force companies to notify the government if they find evidence of contract abuse of more than $5 million.
Failure to comply could make a
company ineligible for future government work.The proposed rules, which
are in the final approval stages, specifically exempt contracts to be performed outside the United States,
according to a notice published in
January in the Federal Register. Critics
including the watchdog group Taxpayers Against Fraud said the overseas
exemption raises suspicions.
The United States poured billions of
dollars into projects in Iraq and
Afghanistan to secure and rebuild the
two nations.With the money came the
fraud.At least $14 million has been lost
in bribes alone over the last five years
in Iraq and Afghanistan, and I believe
that is just the tip of the iceberg. The
Justice Department so far has charged
44 people with bribery, conspiracy,
money laundering, and other contract
fraud crimes related to the governments wartime spending. Some of
those cases came from the Office of
the Special Inspector General for Iraq
Reconstruction, which has 52 investiga-
14
tions ongoing into bribes, false billing,

contract fraud, kickbacks, and theft.The
Army Criminal Investigation Command
has 90 criminal investigations under
way into alleged contract fraud in Iraq,
Kuwait, and Afghanistan.
The Associated Press reported that
an estimated $350 billion is spent on
government contracts annually. This
comes from the White House Office of
Federal Procurement Policy. With
money going to contractors and subcontractors, both foreign and based in
the United States, experts say its nearly
impossible to pinpoint how much of it
is spent overseas. Studies by the Center
for Public Integrity estimate that at
least $102 billion has been spent since
2003 on postwar contracts in Iraq and
Afghanistan.The study says spending to
secure and rebuild the two nations has
grown by more than 50% each year.
Meanwhile, the number of companies
reporting internal fraud in their handling of government contracts has
declined sharply. In 1987, contractors
voluntarily reported 44 instances of
fraud or abuse to the Justice Department. By 2002, the number had
dropped to eight. Last year, contractors
reported three instances of fraud. If
anybody believes voluntary compliance
and self-reporting works, they havent
kept up with the news lately.
DEPARTMENT OF JUSTICE HAS FAILED TO

PRODUCE NATIONAL DATABASE TO HELP
PREVENT AUTO FRAUD
More than 15 years after Congress
required the federal government to set
up a national database to allow car
buyers to determine whether a vehicle
has been stolen or rebuilt after a
wreck, the system is still not in place,
three consumers groups have complained. Public Citizen, Consumers for
Auto Reliability and Safety (CARS), and
Consumer Action have filed a lawsuit
against the Department of Justice
(DOJ) in the U.S. District Court for the
Northern District of California. The
groups want the court to order the

DOJ to move forward with creation of
the National Motor Vehicle Title Information System. The database would
help consumers avoid purchasing a
potentially dangerous used car by
allowing them to instantly check the
validity of a cars title and mileage and
learn whether it had been stolen or
was a junk or salvage vehicle.
A salvage vehicle is one that was
totaled in collision, fire, flood, or other
event to the extent that its value, plus
the cost of repairing it for legal operation, is more than its fair market value
immediately before the event that
caused the damage. Peoples lives are at
risk because they are buying used cars
that are missing air bags or have other
critical safety defects because of their
hidden histories as junked or salvaged
vehicles, according to Public Citizen
President Joan Claybrook. The federal
government should deliver on what
Congress directed in 1992.
Congress passed the law that called
for the national database in 1992 but
shifted responsibility of establishing it
to the DOJ in 1996 because the
Department of Transportation had
failed to make any headway.The move
didnt make a difference; the DOJ has
now delayed more than 10 years
without making progress on this critical source of information for consumers. Every year, people all across
the country fall victim to auto fraud
when they buy used cars that were
rebuilt after a wreck.
Under the 1992 law, junk and salvage
yard operators are required to file
monthly reports to the database operator. Each report is supposed to contain
a list of the vehicle identification
numbers of all junk and salvage vehicles obtained during the previous
month.The law also requires insurance
companies to file similar reports. But
the DOJ has yet to establish regulations
that would tell insurance companies
and junk and salvage yards how to
report their information.
The suit filed by the consumer
groups asks the court to find the
Department of Justice in violation of

the 1992 law for not having established
the database or even the regulations
setting it up.The court is being asked
to order the DOJ to issue the regulations within 30 days of finding the
agency in violation.
Source: Public Citizen
VI.
THE CORPORATE
WORLD
BIG PHARMA IS LITERALLY RAPING THE
AMERICAN PEOPLE
Even though the pharmaceutical
industry has been a target in the presidential campaign, that hasnt stopped
the industry from continuing to aggressively raise the prices of prescription
drugs. Pharmaceutical companies
increased wholesale prices for the 50
top-selling branded drugs by an average
of 7.82% in 2007, after increases of
6.73% and 6.22% in the previous two
years, according to Delta Marketing
Dynamics Inc., a health-care marketing
research company. The most recent
increase is almost double the overall
U.S. economys 4.1% annual inflation
rate last year. I am afraid that we are
seeing just the beginning of drug price
increases that will continue at record
paces.
Some individual drugs had doubledigit price increases over three years.
For example, GlaxoSmithKline PLC
raised the price of antidepressant Wellbutrin XL by 44.5% from 2005 to 2007.
Sanofi-Aventis SA raised the price of
sleep drug Ambien 70.1%. Shire PLC
increased the price of its attentiondeficit disorder medication, Adderall
XR, by 33.5%, while the price of cholesterol-fighting Lipitorthe worlds topselling drug, which brought in roughly
$13 billion last year for Pfizer Inc.
rose 16%.
The pharmaceutical industry is politically powerful and has pretty much
had its way in our nations capitol.The
American people have been victims of

an industry that has let marketing
forces in the companies push medical
doctors out of control positions in the
corporate structure. Greed has pretty
well taken over in the corporate boardrooms of the drug companies and that
has resulted in the American people
subsidizing the rest of the world on the
prices of prescription drugs.
The pharmaceutical industry has
been a target of criticism in the presidential campaign by Senator Barack
Obama, who will be the Democratic
nominee. He will be a strong protector
of consumers once he is elected. The
fact that Americans pay more for individual drugs than any other countrys
citizens cant be justified. On his Web
site, Senator Obama says he will
prevent [drug] companies from
abusing their monopoly power
through unjustified price increases.
The Senator has endorsed giving the
federal government, which currently is
excluded by law from directly negotiating with drug makers, the power to
negotiate prices for the Medicare Part
D drug benefit.The right of the federal
government to negotiate prices with
the powerful drug companies was
taken out of the Prescription Drug Act
passed in 2006 by the Bush Administration and the drug industry lobbyists.
Most folks are shocked when they find
out what has happened on that front.
Source: Wall Street Journal
FIVE FORMER INSURANCE EXECUTIVES

FOUND GUILTY
Five former insurance company
executives were found guilty late last
month of a scheme to manipulate the
financial statements of the worlds
largest insurance company.The verdict
came following a month-long federal
court trial. The defendants were four
former executives of General Re Corp.
and a former executive of insurance
industry leader American International
Group Inc., who were accused of inflating AIGs reserves through reinsurance
deals by $500 million in 2000 and 2001

to artificially boost its stock price.The
defendants were former General Re
CEO Ronald Ferguson; former General
Re Senior Vice President Christopher P.
Garand; former General Re Chief Financial Officer Elizabeth Monrad; and
Robert Graham, a General Re senior
vice president and assistant general
counsel from about 1986 through
October 2005.Also charged was Christian Milton,AIGs vice president of reinsurance from about April 1982 until
March 2005.
AIG SETTLES WITH STATES OVER BIDRIGGING ALLEGATIONS

American International Group, Inc.
(AIG) has reached settlements with
nine states and the District of Columbia
relating to their investigations into
alleged bid-rigging and price-fixing and
questions about undisclosed contingent commissions paid to brokers.The
states contended that some of AIGs
subsidiaries were involved in a pay-toplay tactic used by Marsh & McLennan
and other insurance brokers that purportedly caused businesses to pay
higher insurance premiums.The settlements, which are subject to court
approvals, were reached with the Attorneys General of Florida, Hawaii, Maryland, Michigan, Oregon,Texas, and West
Virginia; the Commonwealths of Massachusetts and Pennsylvania; the District
of Columbia; the Florida Department of
Financial Services; and the Florida
Office of Insurance Regulation.The settlements call for total payments of
$12.5 million to be allocated among
the 10 jurisdictions.
During the term of the settlement
agreements,AIG said it will continue to
maintain certain producer compensation disclosure and ongoing compliance initiatives.AIG will also continue
to cooperate with the industry-wide
investigations.The agreement with the
Texas Attorney General also settles allegations of anticompetitive conduct
15
relating to AIGs relationship with

Allied World Assurance Co., and
includes an additional settlement
payment of $500,000 related to that
issue.
According to the complaint,AIG and
several of its insurance subsidiaries
allegedly conspired with Marsh and
other brokers by submitting fake bids
to create the illusion of a competitive
bidding process in the excess casualty
commercial insurance market. Investigators said they determined that
despite the appearance of a fair bidding
process, the broker had already
decided which insurer would receive a
particular policyholders business. As
part of the scheme, AIG paid the
brokers contingent commissions that
were not disclosed to policyholders
and in return received other lucrative
business, according to knowledgeable
sources.
$24 MILLION SETTLEMENT IN DOW JONES

TRADING CASE
The Securities and Exchange Commission has settled its case with a
former director of Dow Jones and three
others. David Li, the former Dow Jones
board member, had been accused of
passing confidential information about
Rupert Murdochs $5 billion offer for
the company to a friend, Michael
Leung. Li, the chairman and CEO of the
Bank of East Asia, will pay an $8.1
million civil penalty to resolve the
matter. Leung will disgorge the $8.1
million profit he made off the tip, and
pay a further penalty of $8.1 million.
This brings to an end one of the biggest
inside-trading investigations of 2007.
The total amount of the settlement is
$24 million.
Source: USA Today
HEALTH CARE FINANCING COMPANY STOLE

$1.9 BILLION FROM INVESTORS
care financing company defrauded

investors of $1.9 billion and took part
in a massive cover-up to hide their
dealings. This is one of the largest
white-collar crimes since Enron and
WorldCom. The government says
National Century executives misdirected payments and then made up
numbers and loaded false data on to
computer systems to cover their tracks,
while moving money between subsidiaries to make them appear healthy.
The companys mission was to help
health care companies pay their bills
by filling the gaps between the time
doctors rendered a service and the
time they were paid. A trial in federal
trial in Columbus, Ohio started last
month and is expected to last for
several weeks. National Century was
paying some health care companies
money well in excess of what they
needed to cover operating costs while
concealing extra payments from
National Century investors.
National Century had been the
nations largest source of financing to
health care providers. Doctors, hospitals and other providers received
money from the company rather than
waiting for insurance payments, usually
getting 80 or 90 cents on the dollar.
National Century was then to collect
and keep the full amount of the payments owed by insurance companies.
National Century raised the money to
fund its business by selling bonds to
investors, who received interest payments followed by a lump-sum
payment. The government alleges
National Century executives routinely
overpaid some health care providers,
many of them entities in which the
executives had a financial interest.
National Century told investors it was
making the proper payments, according to the government.The government
expects to call 45 witnesses during the
trial, which is expected to last six to
eight weeks.
SETTLEMENT ON AIRLINE PRICE FIXING

British Airways and Virgin Atlantic
will jointly pay about $203 million to
settle a lawsuit brought by passengers
who said the airlines illegally fixed the
price of fuel surcharges on long-haul
trips.The agreement settles a two-yearold case in United States District Court
for the Northern District of California
contending that customers overpaid
for fuel surcharges, which were meant
to help airlines cope with rising fuel
costs. Under the pact,American ticket
purchasers will receive $59 million and
British purchasers will get 73.5
million ($144.4 million) in refunds,
according to lawyers representing the
plaintiffs. The agreement, which still
requires court approval, covers eight
million passengers in the United States
and Britain who bought tickets from
either British Airways or Virgin
between August 11, 2004, and March
23, 2006.The airlines will pay one-third
of the fuel surcharge the passengers
paid for each ticket.
Last year, British Airways agreed to
pay roughly $247 million in a settlement with British authorities for discussing fuel surcharges with Virgin.The
latest agreement resolves a civil lawsuit
brought in the United States that contended that passengers were overcharged on the fuel surcharges and
were told that the added fees were necessary to cover the rising cost of fuel,
but in reality were used to increase the
airlines profits. The amount to be
refunded to passengers will be up to
10 ($19.65) for each flight segment.
The Washington law firms of Cohen
Milstein Hausfeld & Toll and Cotchett,
Pitre & McCarthy in Burlinigame, California, represented the plaintiffs.
Source: Reuters
Executives of National Century

Financial Enterprises, a failed health
16
www.www.BeasleyAllen.com
VII.
PRODUCT
LIABILITY UPDATE
ROOF STRENGTH RULE DELAYED AGAIN
Safety regulators at the National
Highway Traffic Safety Administration
(NHTSA) are having a difficult time
updating the controversial standard for
vehicle roof strength.The present standard has been on the books since 1971
and a proposed new standard has been
repeatedly delayed. Now, NHTSA has
asked for additional information from
automakers, safety advocates, and the
public about the proposed new standards. The most recent version of the
rule under consideration at NHTSA
would require both sides of a vehicle
roof to support at least two and half
times the vehicles weight. But safety
advocates arent buying it. Public
Citizen President Joan Claybrook, who
headed NHTSA from 1977 through
1981, observed:
The proposal is still a static test
one based on mathematical calculations, rather than a dynamic
physical test and it still is at 2.5
times the weight of the vehicle.
The agency has played games with
the regulation since the first NHTSA
revision of the roof strength rule came
about. Everybody knows the current
rule is very weak.The existing standard
mandates that just one side support at
least one and half of the weight of a
vehicle weight. The initial revision of
the roof strength rule from NHTSA
required support of two and half times
vehicle weight but would have continued testing on one side only. NHTSA
Administrator Nicole Nason now says
that double-sided testing is a viable
alternative approach.
Safety activists have demanded a
dynamic rollover test, which would
require rolling a moving vehicle to
gather data.Automakers insist that such
a test will be costly, and that accidents
involving rollovers include too many

variables to design a reliable test. Each
year, nearly 10,000 people die in
rollover crashes, but government data
suggest that only a small percentage of
vehicle occupants are killed by collapsing roofs. Public Citizen President Joan
Claybrook had this to say about the
proposed rule:
The proposal absolutely ignores
ejection and containment in the
vehicle during rollovers, in which
10,500 people die each year and
another 17,000 are seriously
injured. To justify a strong
rollover protection standard, the
agency should address roof crush,
ejection and containment as one
standard.
Congress most recently directed
NHTSA to adopt a new roof standard
by April 2009. NHTSA plans to issue a
new rollover rule later this year. I hope
the agency will put the safety and
welfare of people first and foremost
and get the job done.
Source: Consumeraffairs.com
$6.5 MILLION VERDICT AGAINST FORD

MOTOR CO. IN EXPLORER ROLLOVER CASE
A state of Texas jury has awarded
$6.5 million to a 41-year-old man left
brain-damaged in a 2004 rollover accident involving an Explorer sport utility
vehicle. Ruben Zamora lost control of
the 1993 Explorer when a tire lost its
tread. He was ejected from the vehicle
as it rolled over. His mother, suing on
his behalf, said the tread separation set
off vibrations in the rear of the vehicle
that made it skate sideways because of
a defect in the SUVs suspension. Ford
has known about the problem for
years, but has failed to fix it.The state
court jury in Cotulla,Texas, found the
Explorer defective and awarded $10
million in damages.The jury found that
Mr. Zamora was 35% responsible for
the accident, leaving a verdict of $6.5
million against Ford.
Mr. Zamora, a disabled oil field
worker before the accident, was

injured in August 2004 while driving in
south Texas, near San Antonio. He sustained severe brain damage and will
need someone to take care of him for
the rest of his life. Bill Newman, a very
good lawyer from Texas, represented
the plaintiff and did a very good job in
this case. Ford says it will appeal.
Source: Bloomberg
YAMAHA RHINO ATV ACCIDENTS

The issue of ATV safety has become a
growing concern nationwide. In
November 2007, Consumer Reports
published findings of a five-year study
comparing the prevalence of ATV and
bicycle crashes from 2000-2004, noting
that hospitalizations from ATV incidents are growing at a markedly higher
rate than those caused by bicycle
injuries even though there are far more
bicycle owners. (source: www.blogs.
consumerreports.org) The study was
funded by the Concerned Families for
ATV Safety and the Arabella Legacy
Fund, a private charitable organization
that also supports the Responsible
Trails Alliance.
One of the most dangerous ATVs on
the market is the Yamaha Rhino. Since
the Yamaha Rhino All Terrain Vehicle
was introduced to the market in the
United States in 2003, it has caused a
large number of devastating rollover
accidents that left adults and a number
of children seriously injured, permanently maimed and in some instances
dead.With the popularity of ATVs, the
number of accidents occurring has
risen over the years, and in most
instances these accidents are attributed
to driver error and/or dangerous riding.
But, in the case of the Yamaha Rhino
ATV, these injuries can be directly
linked to Yamahas defective design of
this ATV.These design defects include:
High center of gravity
Small wheels
Narrow wheelbase / frame
17
When these design defects are

coupled with a powerful engine, fast
acceleration ,and quick turning radius,
the Rhino can become very unstable,
even at slow speeds. In addition to the
aforementioned design defects, the
Yamaha Rhino provides inadequate
protection for drivers and passengers
limbs in the event of an accident.The
original design was manufactured
without doors of any kind.The design
resulted in arms, legs, and bodies being
crushed when the defectively
designed ATV rolled over. Consumers
need to be very concerned if they have
purchased a Rhino, especially if children ride in it.We are currently looking
at a number of potential claims involving these ATVs.
Source: CPSC
COURT APPROVES VAN CRASH LAWSUIT

SETTLEMENT
A federal judge has approved a settlement between DaimlerChrysler Corp.
and a number of plaintiffs in a case
arising out of a 15-passenger van
rollover. The lawsuit was brought by
two survivors and the families of seven
Utah State University students killed in
a 2005 van rollover. U.S. District Court
Judge Tena Campbell signed an order
accompanying the settlement. DaimlerChrysler made the 15-passenger Dodge
van that rolled several times, killing
eight students and their instructor.The
victims were returning to the USU
campus from an agricultural field trip.
The plaintiffs reached a settlement
with the van maker late last year, but it
had to be approved by Judge Campbell.
The maker of the vans tires, Copper
Tire & Rubber, remains a defendant in
the case, which is set for trial in July.As
we have written on numerous occasions, these 15 passenger vans are
unsafe and should never be used to
transport passengers.
Source: Salt Lake Tribune
18
CHINA PLANT PLAYED ROLE IN DRUG TIED

TO 4 DEATHS
A Chinese facility that hasnt been
inspected by the U.S. Food and Drug
Administration (FDA) made the active
ingredient in much of the widely used
Baxter International Inc. bloodthinner that is under investigation. Hundreds of allergic reactions and four
deaths among the drugs users have
been reported.The disclosure adds to
already grave concerns about the safety
and quality of products imported from
China and elsewhere in the developing
world.A tide of tainted goods ranging
from pet food to childrens toys has
prompted recalls and increased
scrutiny of Chinese-made wares around
the world. The fact that the Chinese
plant was the supplier to Baxter will
fuel questions about U.S. regulators
ability to ensure the safety and quality
of imported drugs and drug ingredients. I have to wonder how the Bush
Administration and Congress could
allow the FDA to be underfunded and
understaffed and expect the agency to
do its job.
Baxter temporarily halted production
of its version of the generic anticlotting
drug heparin because of about 350 bad
reactions potentially tied to the drug,
including four fatalities, primarily in
patients undergoing kidney dialysis and
heart surgery. It should be noted that
China is now the worlds largest producer of active pharmaceutical ingredientsthe
chemical
compounds
needed to make finished pills and other
drugs. In 2005, China had $4.4 billion,
or 14%, of the worlds $31 billion
market for active drug ingredients,
according to a report last year from
Credit Suisse.
Recent testimony from the federal
Government Accountability Office said
that the FDA may only inspect around
7% of foreign drug-making facilities in a
given year, and it would take the
agency more than 13 years at that rate
to inspect all the plants.The testimony
also said the FDA cannot provide the
exact number of foreign establishments
that have never been inspected. The

agency also had varying counts of how
many overseas facilities ship drug
ingredients to the U.S. The FDA has
admitted that it hadnt inspected the
Chinese facility that made the active
ingredient in the Baxter drug.
The plant making the active ingredient was supposed to be inspected
according to the FDA, but due to
human error, and inadequate information technology systems, a pre-approval
inspection, which would normally be
conducted, was not done. A major
competitor of Baxters, APP Pharmaceuticals Inc., of Schaumburg, Ill., also
gets the active ingredient for much of
its heparin from a Chinese supplier.
VERDICT FOR $11 MILLION AGAINST

MITSUBISHI
A jury in Florida has ordered Mitsubishi to pay $11 million in compensatory damages to a couple whose son
died after being partially ejected from a
sport utility vehicle. As has been
reported, Mitsubishi put its Montero
SUV on the market despite known
problems with the seat belt.The plaintiffs 25-year-old son, Scott, died hours
after a rollover crash in 2004. Even
though he was wearing his passengerside seat belt, Scott was catapulted
backward through the rear window.
The Japanese auto giant took the
unprecedented step of releasing a new
version of the vehicle halfway through
the 2000 model year to correct the
flaws, but never told customers about
the defect in the earlier model.The carmaker has admitted design changes
were prompted by poor crash tests.
Jurors awarded the couple $10
million for pain and suffering and the
rest for funeral expenses and other
losses. The lawsuit was filed in Palm
Beach County Circuit Court because
the car company has business operations based in the area. As you may
recall, Mitsubishi was rocked by a
scandal about the systematic cover-up
of design defects in vehicles that

resulted in massive recalls.The scandal
surfaced in 2000, when the company
acknowledged it had hidden defects for
decades, secretly repairing them
without proper recalls despite reports
of dozens of accidents.
VIII.
MASS TORTS
UPDATE
VIOXX SETTLEMENT UPDATE
As we have reported last fall Merck &
Co. agreed to a Settlement Program to
compensate individuals who suffered a
heart attack or stroke while using the
pain reliever, Vioxx. The settlement
process is progressing on schedule.The
first step in cementing the $4.85 billion
dollar settlement deal was the registration of all Vioxx claims that were filed
in court or tolled with Merck before
November 9, 2007. The registration
deadline expired on January 15, 2008,
with over 58,000 claims having been
registered. This necessary step served
as a census so that the parties and
supervising courts could gain a better
understanding of the total number of
Vioxx-related claims pending throughout the country.
The second step in effectuating the
settlement is the enrollment of eligible
claims. Only previously filed and tolled
heart attack and stroke cases are eligible to enroll or participate in the
Program. In order for the Settlement
Program to become effective, 85% of all
eligible heart attack and stroke claims
must be enrolled in the program.
Claimants, or lawyers on their
behalf, were required to enroll by February 29, 2008, in order to participate
in the Program and qualify for an
interim payment. Enrollment is accomplished through the submission by a
lawyer of an enrollment form as
well as a release and certain authorizations for each claimant. The Vioxx
Plaintiffs Negotiating Committee has

announced an agreement with Merck
to provide a grace period for the submission of releases and other document to the Claims Administrator.
claimants or their lawyers were
required to indicate by February 29,
2008, that they plan to enroll but they
will have the benefit of a 30-day grace
period to submit the necessary forms
to the Claims Administrator.
At the time of this writing, well over
80% of eligible clients have already
enrolled and many more are expected
to enroll before the deadline.This is a
very encouraging sign in light of the
short time-frame in which claimants
and their lawyers have had to accomplish the necessary steps for enrollment. It is expected that over 95% of
the appropriately 47,000 eligible
claimants will be enrolled by February 29thin fact, I believe the enrollment will exceed 90%. After the 95%
of Eligible Claimants enroll, the Settlement Program will become effective,
and Mercks walk-away rights under
the Settlement Agreement will be
extinguished.
Following the enrollment stage, the
third step will be for claimants, or their
lawyers to submit medical records to
the Claims Administrator, including hospitalization records and pharmacy
records that prove that they suffered
heart attack or stroke while using
Vioxx. The Claims Administrator will
determine whether the claim passes
through the three gates necessary for
compensationinjury, duration of
Vioxx usage, and proximity of usage.
The deadline for the submission of
claims information or packages is July
1, 2008.Though the deadline is months
away, several hundred claims packages
have already been submitted.
The Vioxx Settlement Program provides a very good resolution for those
injured while taking the drug. We
believe its is in the best interests of all
of our clients and we have recommended that they participate.The settlement was hard-won after more than
5 years of strenuous litigation, includ-
ing 17 trials. Rightly, the settlement has

been well received by claimants and
counsel around the country. Andy
Birchfield, head of our Mass Torts
section, not only was central in the
negotiation of the Settlement Program,
but continues to be a primary person
guiding the settlement during these
early stages. His work, as well as the
work of Leigh ODell, Roger Smith, and
a great team of lawyers and staff personnel, has been exemplaryexcellent
for our clients and essential to the
success of what is the largest settlement in the history of pharmaceutical
litigation.We are proud to have been a
major part in providing justice to a
tremendous number of Vioxx victims.
THE FIRST BEXTRA TRIAL IN MDL IS SET

The Multi-District Litigation (MDL)
Court for the Bextra/Celebrex litigation
has set the first Bextra trial for May 5,
2008. Pfizer is the company that manufactures both Bextra and Celebrex.
Bextra, a Cox-2 inhibitor, was not as
widely prescribed as Vioxx and Celebrex, which are in the same class of
drugs. This is because Bextra was a
second generation Cox-2 inhibitor and
was not put on the market until 2002.
Celebrex and Vioxx went on the
market in 1999. Nonetheless, Bextra
was prescribed to millions of patients,
and in 2004 exceeded $1.2 billion in
prescription sales.
Similar to the manufacturer of Vioxx,
Pfizer had early signs that Bextra data
showed a potential increase in cardiovascular risks associated with Bextra.
Specifically, a Coronary Artery Bypass
Graft surgery study (CABG 1) in July,
2000 showed an increased cardiovascular signal with Bextra in high risk
patients. A Pfizer clinician even commented on the Vioxx-like safety
profile of Bextra when compared to
Vioxx. After other studies indicated
similar risk, the CABG 2 study completed in January 2004 echoed the
CABG 1 study, by showing a significant
increased risk of heart attacks and
19
strokes linked to Bextra. Only months

after Merck removed Vioxx from the
market, on September 30, 2004, the
Food and Drug Administration (FDA)
requested that Pfizer remove Bextra
from the market because of the
increased risk of heart attacks and
stroke, among other risks.
The Bextra/Celebrex MDL court,
located in San Francisco, California, has
ordered limited discovery to be taken
in a group of 45 Bextra and Celebrex
MDL cases. From this group of cases,
the presiding MDL judge has recently
announced that he wanted the parties
to have several Bextra cases ready for
trial on May 5, 2008. The court only
plans to try one case at a time, but
wants several Bextra cases ready in the
event that any case set first is resolved
before the first trial date. The MDL
courts commitment to allow these
cases to go to trial will help determine
the value and ultimate resolution of
these cases. Navan Ward and Frank
Woodson from our firm are actively
involved in this litigation and have
done outstanding work.
according to a report by The New York

Times.The U.S.Attorneys office for the
Eastern District of Pennsylvania is
investigating Zyprexa marketing.About
30 state attorneys general also have
subpoenaed documents detailing Lillys
sales practices for Zyprexa as part of a
civil investigation under state consumer protection laws. Lilly also faces
lawsuits from several states and some
third-party payers accusing it of promoting the off-label use of Zyprexa
for treatments not approved by the U.S.
Food and Drug Administration.
For example, a complaint filed in
Utah accuses Lilly of pushing doctors
to prescribe it for conditions like
Alzheimers and dementia and depression. Doctors are free to prescribe
drugs for uses not approved by the
FDA, but pharmaceutical companies
are prohibited by law from marketing
drugs for non FDA-approved uses.The
latest complaint was filed by the shareholders in U.S. District Court for the
Southern District of Indiana.
Source:
THE FDA DOES A POOR JOB OF

REGULATING
SHAREHOLDERS SUE LILLY OVER ZYPREXA
Two shareholders have sued Eli Lilly
and Co. accusing Lilly executives and
directors of recklessly disregarding
risks posed by illegal drug marketing
tactics. This is the latest in a string of
challenges over Zyprexa, which has
generated billions of dollarsand lots
of lawsuitsfor Lilly. The drug maker
has settled thousands of patient lawsuits over the drug, an anti-psychotic
approved to treat schizophrenia, acute
mania, and bipolar disorder.These settlements have cost Lilly more than $1
billion. The company failed to warn
about the potential for diabetes or
weight gain associated with the drug,
and that is a claim in most of the lawsuits.
Lilly also could pay more than $1
billion to state and federal governments
resulting from a separate investigation,
The Food and Drug Administration

simply cant keep up with requirements to inspect domestic makers of
medical devices to assure manufacturing quality. In fact, the agency rarely
examines foreign facilities, according to
congressional investigators. In testimony delivered before a House Energy
and Commerce subcommittee, the
Government Accountability Office told
lawmakers that it found weaknesses
in the agencys oversight of an industry
that makes products ranging from
contact lenses to defibrillators.
According to FDA officials own estimates, overseas makers of the riskiest
products, such as pacemakers, were
examined only every six years, and
moderate-risk device manufacturers
on average went an estimated 27 years
between FDA inspections. The
medical-device testimony was that
20
FDA officials estimated U.S. makers of

the highest-risk products are examined, on average, every three years.
Domestic manufacturers of moderaterisk devices get inspected every five
years. Both are supposed to be looked
at every two years. Its pretty scary
when you consider that the FDA is
unable to do its job when it comes to
protecting the public relating to
health and safety issues.
FDA LETS DRUG COMPANIES OFF THE

HOOK
issued a proposed rule recently that
directly
contradicts
Congress
expressed intent when it passed the
Food and Drug Administration Amendments Act of 2007 (FDAAA), an act
which encompasses the Prescription
Drug and User Fee Act. If the proposed rule becomes final, drug companies will enjoy more relaxed labeling
requirements and will surely use the
rule to claim immunity for failing to
warn patients of potential drug
hazards. When Congress passed the
FDAAA, it included language confirming the responsibility of the drug manufacturer to promptly update its drug
label when they become aware of new
safety information. Congress was clear
that it intended to keep the burden
squarely on the drug companies to
update warning labels.
Nevertheless, the FDA has promulgated this new rule against Congress
expressed wishes. Congress explicitly
stated that it did not intend to ease the
requirements on drug companies to
inform consumers of potential drug
hazards. It reiterated the need for drug
companies to change its label if the
drug company learns of reasonable evidence of that risk. In fact, the drug
companies fought and lobbied hard to
include language to loosen warning
label obligations that the Congress
specifically left out of the final bill.
But because the drug companies could-
nt get Congress to agree to lessen their

responsibilities towards consumers,
they turned to a political ally, the Bush
Administration.
Unfortunately, the FDAs tactics are
not new to Bush Administration
bureaucrats. Unelected federal agencies have been ignoring congressional
directives in a number of other cases.
The Environmental Protection Agency,
National Highway Traffic Safety Administration, Consumer Product Safety
Commission, and others are also engaging in this tactic of Bureaucratic
Activism.This system of backdoor tort
reform is being pushed by none other
than the President, the Vice-President,
and the infamous Karl Rove, who is the
real brain behind the Administrations
push to protect corporate wrongdoing.
Congress must take action to safeguard Congressional prerogatives and
protect the public. Let your member
of Congress hear from you on this
issue. They must be made to understand that this issue matters to folks
who are victims of corporate wrongdoing.We must put an end to this unjust
form of backdoor tort reform.The FDA
is letting drug companies off the hook
and ignoring Congressional intent, and
its up to us to teach our elected officials the truth. If they get away with
the FDA preemption, you can rest
assured the concept will be carried to
other regulatory agencies.
summers at the warehouse. The three

men wore the same work clothes for
several days bringing home cancercausing fibers every day from work,
unknowingly letting the microscopic
fibers fragments waft throughout their
home and settle.The jury found against
Asbestos Corp. Ltd. of Canada, which
provided material for GM brakes, and
BorgWarner Inc. of Michigan, which
made clutches. Moshe Maimon represented the plaintiff in this case and did
a very good job.
VERDICT RETURNED IN ASBESTOS CASE

A jury in Baltimore, Maryland, has
ordered a sealant company to pay a 73year-old man $15.3 million after determining that he developed mesothelioma
from exposure to asbestos-containing
products made by the company.
George J. Linkus worked at Key
Highway Shipyard from 1952 to 1959.
In 1954, Mr. Linkus moved to the
machine shop and worked on lining
valves using rope made by the defendant, John Crane Inc. The jury found
that the rope used by Linkus contained
asbestos.As you know, mesothelioma is
a cancer directly linked to asbestos.The
verdict came after a three-week trial.
David L. Palmer of Baltimore, Maryland
represented the plaintiff and did a very
good job.
Source: Baltimore Sun
Source: Action Network
NEW JERSEY JURY AWARDS $30.3 MILLION

TO FAMILY IN ASBESTOS DEATH
The family of a man who died from
an asbestos-related cancer was awarded
$30.3 million by a New Jersey jury last
month.The award is believed to be the
largest in New Jersey for mesothelioma, an aggressive lung cancer. The
disease killed 50-year-old Mark Buttitta
in 2002. He had handled auto parts
containing asbestos while working
summers at giant GM warehouses in
New Jersey. Buttittas father had
worked there. His brother also spent
FDAS BOTOX WARNING FALLS SHORT

(FDA) reported that botulinum toxin,
available as Botox and Myoboloc, has
been linked to adverse reactions,
including respiratory failure and death.
Public Citizen has petitioned the FDA
to immediately increase its warnings
about the serious risks of using Botox
and Myoboloc. Adverse reactions can
include paralysis of the respiratory
muscles and difficulty swallowing (dysphagia), a condition that can allow
food or liquid to enter the respiratory
tract and lungs, causing aspiration
pneumonia. An analysis by Public

Citizen of FDA data found that the
makers of the drugs had reported 180
U.S. cases of people developing
serious conditions after receiving
injections, including 16 deaths.
The FDA couldand shoulddo
much more than send out a press
release about their concerns. Every
doctor who is injecting botulinum
toxin needs to know about the dangers
of the toxin spreading to other parts of
the body.The only way this is going to
happen is by requiring the makers of
the drug to send warning letters to all
doctors who use Botox and Myoboloc.
Every patient needs to know about
these risks, and the only way this is
going to happen is if doctors are
required to hand patients a written
warning every time they receive an
injection.
Its not enough that the FDA publicly
acknowledges the risks of using botulinum toxin. In fact, the agency did this
much in a published article three years
ago. The FDA must immediately force
the drug makers to send out warning
letters to doctors, similar to what drug
regulatory agencies in Europe already
require.The FDA also should label the
products with a black box warning,
the strongest warning the agency can
make and require doctors to hand out
medication guides to patients, warning
them of the early symptoms of an
adverse reaction. The FDA needs to
move quickly to educate physicians
and patients. Nobody should be dying
from injected botulinum toxin, and the
FDA should do its job.
Source: Public Citizen
CVS CAREMARK CORP. REACHES

SETTLEMENT
CVS Caremark Corp. has agreed to
pay $38.5 million to 28 states to settle
charges that Caremark duped doctors
into switching drug brands for their
patients by promising that switching
would save the patients or their health
plans money. Caremark Rx LLC and
21
two of its subsidiaries got rebates from

drug manufacturers, but kept the
money themselves. Caremark has set
aside $2.5 million more to reimburse
patients who required extra tests or
monitoring when their cholesterol-controlling drugs were switched at Caremarks behest.
Caremark LLC and CaremarkPCS (formerly AdvancePCS) operate a mailorder pharmacy service and administer
pharmacy benefits for companies and
organizations that include drug coverage in their health insurance plans.The
settlement prohibits the company from
soliciting drug switches when:
The net cost of the proposed drug is
greater than the net cost of the one
originally prescribed.
The cost to the patient will be
greater.
The originally prescribed drug has a
generic equivalent and the proposed
drug doesnt.
The patient was switched from a
similar drug in the last two years.
If patients are to be switched, the settlement, which must be approved by
the court, requires Caremark, among
other things, to:
Inform doctors and patients about
the effect a drug switch will have on
a patients co-pay.
Reimburse patients for out-of-pocket
expenses (like testing) related to the
switch.
Allow patients to decline a drug
switch.
Tell doctors whether Caremark is
getting financial incentives for the
switch.
To refrain from restocking and
reshipping returned drugs unless it is
lawfully allowed to do so.
me nowadays.This politically powerful

industry has pretty well ignored the
law and does as it pleases.
JUDGE INCREASES DAMAGES IN STENT

PATENT CASE TO $501 MILLION
A patent verdict against Boston Scientific Corp. has been increased to
$501 million after a judge tacked on an
additional $69 million in interest. U.S.
District Judge T. John Ward ruled to
expand the damages award, decided by
a federal jury in Marshall, Texas, to
cover interest on royalties dating to the
medical device makers 2004 U.S.
launch of drug-coated heart stents. As
you know, heart stents are tiny, meshwire tubes that prop open coronary
arteries after they have been surgically
cleared of fatty plaque. Jurors awarded
$432 million to Dr. Bruce Saffran, who
argued the stents violated his 1997
patent covering technology to deliver
medication within the body to heal
injuries.
Boston Scientific and a unit of
Johnson & Johnson dominate the
market for newer-model stents coated
with drugs released to prevent post-surgical scar tissue from creating new
blockages. Dr. Saffran, a radiologist from
Princeton, New Jersey, filed a similar
patent challenge against Johnson &
Johnson over its Cypher stent.That case
is pending in Judge Wards court, in east
Texas.
Dr. Saffrans award involving Boston
Scientific covers only past royalties.The
judge also ordered that the question of
future royalties be split into a separate
case after the doctor files a new complaint covering that issue. Judge Ward
ordered Boston Scientific to file quarterly reports with the court on sales of
its top-selling product, the Taxus
Express stent, and the next-generation
Taxus Liberte.
There is so much fraud and abuse

involving the pharmaceutical industry
that nothing that is reported surprises
22
JUDGE REDUCES $134 MILLION JUDGMENT

IN WYETH CASE
The $134 million jury award to three
Nevada women who were injured by a
drug made by Wyeth that caused their
breast cancer has been reduced. Judge
Robert Perry, who presided over the
case, granted the drug makers motion
to reduce the jurys award. Judge Perry
reduced the Plaintiffs verdict to just
under $60 million in total damages.The
judge reduced each of the three
womens past and future damages to
$7.2 million; $7.5 million and $7.9
million and reduced the punitive
damages to $10 million, $12 million
and $13 million. Wyeth had argued
that the original awards were excessive
and motivated by passion and prejudice. In agreeing with Wyeth, Judge
Perry noted:
The Court is mindful of the fact
that the jury found that Defendants conduct was the legal cause
of Plaintiffs having gotten cancer
and that cancer is a terrifying and
devastating illness. Further, there is
no doubt that the loss, or surgical
alteration, of a womans breast
has serious and life-long physical
and emotional consequences, as
does the possible recurrence of
cancer, however unlikely it may
be. Who would volunteer to suffer
these consequences for any sum of
money?
As to punitive damages, the judge
wrote
There was substantial evidence
from which the jury could conclude that Wyeth knew that its
product could cause breast cancer,
that it intentionally failed to
conduct adequate studies, that it
financed and manipulated scientific studies, and sponsored articles
in professional and scientific journals that deliberately minimized
the risk of cancer while over-promoting certain benefits and citing
others which it knew to be unsub-
stantiated The jury could justifiably find a significant degree of

reprehensibility in defendants
actions..
We dont fault Judge Perry for reducing the jurys award. In fact, those of us
who try this type lawsuit applaud
Judge Perry for highlighting Wyeths
reprehensible conduct in his Order.
Who could fault a jury for developing a
little passion or prejudice after learning
what Wyeth did to millions of women
in order to improve its financial bottom
line? Judge Perry has demonstrated
once again that our justice system functions very well.
The reduced judgment remains the
largest personal injury award in Nevada
history, and its the largest award to
date against the Madison, New Jerseybased company, which faces about
5,300 similar lawsuits across the
country in state and federal courts.All
the cases involve the drugs Premarin,
an estrogen replacement, and Prempro,
a combination of estrogen and progestin. The drugs are prescribed to
women to ease menopause symptoms.
Ted Meadows and Russ Abney from our
firm are actively involved in the prosecution of HRT cases throughout the
country.
Source: Forbes
WYETH AND PFIZER ORDERED TO PAY

$2.75 MILLION OVER DRUGS
Just after completing the report on
the Nevada case, another development
occurred relating to the HRT cases. A
federal court jury in Arizona found
Wyeth and a Pfizer Inc. unit caused an
Arkansas womans breast cancer and
awarded $2.75 million in compensatory damages.This was the companies
first loss in federal court. The jurors
found the combination of Wyeths Premarin and Pharmacia & Upjohns
Provera menopause drugs helped
cause Donna Scroggins cancer. The
former factory worker had a double
mastectomy after taking hormonereplacement drugs for about 10 years.
This issue went the printer before

the same jury in Little Rock heard evidence on March 3rd on whether Wyeth
and Upjohn should pay punitive
damages in the case. Wyeth has lost
four of seven trials over its hormonereplacement medicines, Premarin and
Prempro, since the cases began going
to trial in 2006.Wyeth won two earlier
cases brought against it in federal court
in Little Rock and was cleared by a
state court jury in Philadelphia. The
company faces about 5,300 lawsuits
over the hormone-replacement drugs,
which are still on the market.
Source: Bloomberg
BARD COMPOSIX KUGEL MESH PATCH

UPDATE
As we have previously reported, a
number of Bard Composix Kugel Mesh
Patches used to repair hernias have
been recalled. Our firm has recently
filed suit on behalf of several clients
who received one of these hernia
patches and as a result suffered serious
harm.These injuries include bowel perforations, infection and major intestinal
problems requiring extensive hospitalization, which can ultimately lead to
death.
In a new development in the litigation, U.S. Magistrate Judge Lincoln
Almond recently denied the defendants motion to conduct ex parte communications with the plaintiffs treating
physicians. In other words, the defendants were denied permission to speak
with the treating doctors outside the
presence of the plaintiff and/or their
attorneys. Judge Almond, citing an
earlier decision from the Vioxx litigation in his ruling, stated:
Balancing all of the competing
factors and guided by Judge
Fallons practical resolution of
this issue in the Vioxx litigation, I
conclude that the better course at
this point is to deny defendants
motion seeking ex parte contacts
with plaintiffs treating physicians.
The plaintiffs successfully argued

that these communications could compromise the doctor-patient relationship
and result in certain medical information being disclosed that would not be
relevant to the litigation. The Court
stated further:
Judge Fallon ultimately concluded that the just optionis to
protect the relationship between a
doctor and patient by restricting
defendants from conducting ex
parte communications with
plaintiffs treating physicians but
allowing plaintiffs counsel to
engage in ex parte interviews
with those doctors who have not
been named as defendants.
According to the defendants, Davol
and C.R. Bard, approximately 180
federal cases and 60 state court cases
have been filed to date. The federal
cases have been consolidated into multidistrict litigation in Rhode Island. Our
firm continues to investigate and file
claims involving the Bard Composix
Kugel Mesh Patch. If you need additional information concerning these
claims, contact Chad Cook at 334-2692343 or 800-898-2034.
Source: Portfolio Media, Inc.
STUDY FINDS DEATH RISK FROM ANEMIA

DRUGS
A new study released last month
revealed that widely-used anemia drugs
sold by Amgen and Johnson & Johnson
raise the risk of death among cancer
patients by about 10%.The new analysis of previous clinical trials was the
basis for the report. The study is the
first compilation of clinical trial data,
called a meta-analysis, to show a statistically significant increase in the risk of
death from the drugs. Dr. Charles L.
Bennett, a professor at Northwestern
University, was the studys lead author.
The Food and Drug Administration is
planning to convene an advisory committee this month to discuss whether
to impose further restrictions on the
23
use of the drugs,Aranesp from Amgen

and Procrit from Johnson & Johnson,
with cancer patients.The Amgen drug
Epogen, is the same as Procrit, but its
aimed at kidney dialysis patients.Apparently, this drug will not be directly
affected by the discussions.The study
will be published in the Journal of the
American Medical Association.
Source: New York Times
IX.
BUSINESS
LITIGATION
DOCUMENTS PROVE WACHOVIA AWARE OF
THEFTS
A lawsuit was filed almost a year ago
alleging Wachovia bank of allowing
fraudulent telemarketers to use the
banks accounts to literally steal millions of dollars from unsuspecting
victims. Bank executives have maintained that they were unaware of the
thefts, but recently released documents
in the lawsuit prove that Wachovia had
known about the allegations of fraud
for quite a while. Those same documents also show that Wachovia continued to provide banking services to
several companies that helped steal at
least $400 million from unsuspecting
victims even after being alerted by
other banks and federal agencies on
the ongoing deceptions.
In spite of this,Wachovia continued
to process fraudulent transactions for
the accounts, partially because
Wachovia would charge fraud artists a
large fee every time a victim spotted a
phony transaction and demanded their
money back. According to investigators, Wachovia was paid about $1.5
million alone from one company in less
than a year. Lawyers pursing the Pennsylvania federal court based lawsuit
against Wachovia have asked a judge to
declare the case a class action.A ruling
by the judge on the class action request
is expected by this summer.
The lawsuit claims that Wachovia
24
accepted fraudulent, unsigned checks

that withdrew funds from the accounts
of victims, often elderly. Wachovia
would then forward those checks to
other banks that were unaware of the
frauds, which in turn sent money to the
swindlers. Wachovia contends that it
has taken aggressive steps to correct
the processes related to this situation.A
spokeswoman for Wachovia stated that
the bank was not currently working
with any telemarketers, would review
any future clients who do work with
telemarketers, and would reject any
client focused solely on telemarketing.
It will be interesting to follow this case
and see how things develop.
WACHOVIA SUES PROVIDENCE OVER BUYOUT

OF TV STATIONS
On another front, Wachovia Corp.
has filed a lawsuit against Providence
Equity Partners trying to get out of
providing financing for the buyout
firms revised $1.1 billion purchase of
television stations from Clear Channel
Communications Inc. Wachovia, the
fourth-largest U.S. bank, claims Providence officials changed the terms of
the accord without consent from the
bank and voided the agreement. The
lawsuit was filed in state court in
North Carolina last month. Providence
and two of its investment banks,
Goldman Sachs Group Inc. and UBS
AG, reportedly has agreed to drop the
price from $1.2 billion for the Clear
Channel unit.
The lawsuit was filed against Providence and its Newport Television LLC
unit. San Antonio, Texas, based Clear
Channel, the largest U.S. broadcaster,
has been in talks with Providence
about changing the terms of the sale
of the 56 TV stations, located in cities
such as Memphis, Tennessee, and
Syracuse, New York. Wachovia claims
Providence renegotiated key terms
of its deal with Clear Channel, but
then demanded that the lenders be
held to the terms of the deal it had
rejected. As a side note, I wonder

they Wachovia didnt elect to use
arbitration rather than burden the
court system with a lawsuit.
Source: Bloomberg
X.
INSURANCE AND
FINANCE UPDATE
PATIENT WHOSE INSURANCE COVERAGE WAS
CUT OFF WILL RECEIVE $9 MILLION
When you think you have heard the
worst of the continuing horror stories
coming out of the insurance industry
in dealing with policyholders, something else happens that further shakes
your confidence in the industry.
Recently, a woman who had her
medical coverage canceled as she was
undergoing treatment for breast cancer
has been awarded more than $9 million
in a lawsuit filed against one of Californias largest health insurers. The 52year-old plaintiff had been left with
more than $129,000 in unpaid medical
bills when Health Net Inc. canceled her
policy in 2004. An arbitration judge
ordered Health Net to repay that
amount and awarded $8.4 million in
punitive damages and $750,000 for
emotional distress.The judge wrote in
his opinion:
Its hard to imagine a situation
more trying than the one Bates
has had to endure. The rug was
pulled out from underneath, and
that occurred at a time when she
is diagnosed with breast cancer,
one of the leading causes of death
for women.
The city of Los Angeles has also sued
Health Net, claiming it illegally canceled the coverage of about 1,600
patients.The company illegally ran an
incentive program in which it paid
bonuses to an administrator for
meeting targets of policy cancelations.
Health Net acknowledged that such a
program existed in 2002 and 2003 but
was subsequently halted.Tying bonuses

to the number of health insurance policies cancelled is about as close to criminal as it gets. The plaintiff had been
insured with another company but was
persuaded to switch over to a Health
Net policy after an agent suggested she
could save money. She had undergone
surgery to remove a tumor and had
received her first two chemotherapy
treatments when doctors stopped
treating her because her bills were
going unpaid.The plaintiff completed
her cancer treatment through a statefunded program. Health Net has said it
will review its practices and the way its
brokers and agents are trained.
REGIONS AND MORGAN KEEGAN

INVESTMENTS SINK LIKE A ROCK IN
A POND
For years, bond funds run by Morgan

Keegans Jim Kelsoe soared. Unfortunately Kelsoes high-flying strategy
finally caught up with him. Kelsoes
losses just as of the end of 2007 have
been stunning. The two open-ended
funds Regions Morgan Keegan
Select High Income and Regions
Morgan Keegan Select Intermediate Bond have each lost more than
half their value. Results of four closedend Morgan Keegan fixed-income
fundsRegions Morgan Keegan MultiSector High Income, Regions Morgan
Keegan Strategic Income, Regions
Morgan Keegan High Income Fund, and
Regions Morgan Keegan Advantage
Income, all managed by Kelsoehave
been even worse.
Multiple arbitrations are being filed
by institutional and private investors
alike. In particular, an Indiana charity
has filed an arbitration complaint
against Morgan Keegan for alleged misrepresentation of risk of the Regions
MK Select Intermediate Bond fund,
which, on the surface, seems to be a
plain vanilla, low-risk bond fund. For a
while, Kelsoe, the chief fixed income
investment officer of the Memphis,Tennessee-based brokerages Morgan Asset
Management, posted outstanding

results then two separate but related
factors crushed Kelsoes funds.
First, reaching for yield, Kilsoe allocated a large chunk of his funds to
exotic and illiquid asset-backed securities (and relatively little to standard
high-yield corporate bonds) that have
been devastated by the upheaval in
credit markets this year. For example, as
of June 30, 2007, 45% of Intermediate
Bonds assets were invested in collateralized debt obligations and homeequity loans. He also stuffed his
portfolios with airline leasing obligations, which suddenly have been buffeted by market turbulence this year.As
a result, the values of his funds assets
plunged. Second, and equally devastating, was the rising tide of shareholder
redemptions, which forced Kelsoe to
sell illiquid assets (investments that are
not readily marketable) at the worst
possible time. In both July and August,
for instance, shareholders yanked more
than $100 million out of High Income,
which at last word held $291 million in
assets. There are only a handful of
trading desks in the country that
handle airline lease-related securities.
Thats why its clear that illiquid assets
such as these are ill-suited to open-end
funds, which are subject to abrupt and
mass redemptions.
The Morgan Keegan disaster is a
reminder that investors need to undertake a bit more investigation than usual
when they contemplate buying into a
bond fund that has delivered abnormally high returns.That requires some
understanding of the assets the fund
holds. In general, you shouldnt invest
in something that you dont understand.We believe that Morgan Keegans
failure to disclose material facts relating to the nature of the risk and the
illiquidity of certain securities in
which the Funds invested lead
investors to believe these funds were
much safer investments. Roman Shaul
and Scarlette Tuley from our firm are
representing a number of individuals
and institutions that have been harmed
by these investments. If you need more
information, call either of them at 334269-2343 or 800-898-2034.
JURY RETURNS VERDICT AGAINST MET LIFE

A jury in Pennsylvania has returned a
$285,000 verdict in a civil case against
Metropolitan Life Insurance Co. and
one of its former sales representatives.
The plaintiff, a 65-year-old woman, told
the jury that then-Met Life representative misappropriated money the plaintiff had given the agent to invest in
various financial products with Met
Life.The agent was accused of taking a
total of $40,000 from the plaintiff and
paying her back $15,000 to make it
appear that her money was invested
with Met Life. The jury awarded
$112,000 in compensatory damages
and $175,000 in punitive damages.The
case was one of 250 filed against Met
Life locally in the 1990s, all of which
have been settled except this claim and
one other by a different client.
Source: Pittsburgh Post-Gazette
CLASS CERTIFIED IN OHIO CASE AGAINST

TITLE INSURANCE FIRM
A federal judge in Toledo, Ohio has
granted class action status in a lawsuit
that could result in refunds for tens of
thousands of Ohio homeowners who
may have been overcharged for title
insurance. Fidelity National Title Insurance Co. is among the nations largest
issuers of policies to protect buyers
and lenders from hidden liens and
other deed problems. In his opinion
U.S. District Judge James Carr wrote:
The interests of fairness, efficiency,
and judicial economy are all best
served by a class action. Certification in this case is important
because each individual class
members claim may be small,
resulting in a diminished incentive to sue to enforce his or her
rights.
The suit was filed early 2006 on
behalf of Jerry and Dianne Randleman
25
who alleged that Fidelity failed to give

them and other customers posted discounts on policies issued in mortgage
refinancing transactions that took
place within 10 years of the original
home purchase. Typical discounts at
Fidelity were supposed to be $100 to
$250 a customer. If they win their
case, up to 94,000 homeowners who
bought policies from Fidelity since
February. 15, 2000, could be affected.
Members of the class probably will
most likely be notified by mail. They
are required to do nothing to participate in the case. But if they choose to
attempt to file their own separate
suits, they must formally opt out of
the case. Fidelity Title is part of
Fidelity National Financial Inc., a
Fortune 500 company based in Jacksonville, Florida. Mark Koberna, a
Cleveland, Ohio lawyer, represents
the plaintiffs.
Source: Toledo Blade
CREDIT SUISSE CANNOT ESCAPE LIABILITY

BY USING BOILERPLATE DISCLAIMER
Recently, the United States District
Court for the Southern District of Ohio
denied motions to dismiss over $1.6
billion in claims filed against Credit
Suisse First Boston (Credit Suisse) by
investors who formerly held AAA
rated notes issued by now-defunct
National Century Financial Enterprises
of Columbus, Ohio (National Century).
As you may know, the AAA rating is
the highest rating this type of investment can hold.
Plaintiffs filed this lawsuit after
National Century, a company that securitized healthcare receivables, collapsed
in late 2002.As has occurred in similar
cases, several of National Centurys officers and employees have pled guilty to
fraud or other federal crimes. Meanwhile the companys president, Lance
Poulsen, and other top officers await
trial in Ohio.The complaints and criminal indictments allege that National
Century raised billions of dollars that
were supposed to be invested only by
26
purchase of valid healthcare receivables. But, National Century diverted

substantial amounts of the money for
other uses. The companys collapse is
one of the largest defaults of AAA
rated debts securities in decades. Credit
Suisse marketed $3 billion of National
Centurys asset-backed securities.
Judge James Graham, who presided
over the case, sits on the United States
District Court for the Southern District
of Ohio. His ruling is highly significant
for purchasers of asset-backed notes,
and is particularly interesting in the
wake of the subprime loan crisis.
Credit Suisse argued that disclaimers
included in the offering memorandum
required the dismissal of Plaintiffs
fraud claims, an argument that the
court categorically denied.The opinion
held that Suisses disclaimer stating that
it had done no independent investigation of its own would seem beyond
credulity, particularly to investors who
knew that Credit Suisse had helped
devise the note programs and helped
draft the offering materials.
The court noted that it would defeat
the securities laws if parties could
escape liability for their own deliberate
misrepresentations by including boilerplate disclaimers into offering materials. A boilerplate disclaimer is a
standard provision in a contract, form,
or legal pleading that is apparently
routine and often preprinted. Nearly
every sector of the investment market
was affected by this fraud. Plaintiffs
include major banks, mutual funds, and
insurance companies, along with the
State of Arizona and a number of
Arizona government entities. In total,
these plaintiffs held over $1.6 billion in
National Century notes.
Source: PR Newswire
XI.
PREDATORY
LENDING
PREDATORY LENDERS ARE A PRETTY
SLEAZY BUNCH
Several years ago, the predatory
lenders began to come under attack
and with justification.The first groups
to be targeted were payday lenders and
subprime lenders in the automobile
lending primarily. More recently, the
practices of mortgage lenders have
come under increased scrutiny. Some
of the lenders were misrepresenting
the terms of loans, making loans
without regard to consumers ability to
repay, making loans with deceptive
teaser rates that later ballooned astronomically, packing loans with undisclosed charges and fees, or even paying
illegal kickbacks.These and other questionable practices were having a devastating effect on home buyers. The
widespread nature of these practices,
which were largely unregulated and
unchecked ,are now threatening the
financial markets worldwide. Even
though predatory lending was becoming a national problem, the Bush
Administration looked the other way
and did absolutely nothing to protect
American homeowners. In fact, the government chose instead to align itself
with the banks that were victimizing
consumers.That has been the hallmark
of this President and his buddies.
Its very clear that the practice of
predatory lenders has caused a national
crisis.The void left by the federal governments inaction the burden of
dealing with the predatory lenders on
the backs of state attorneys general of
both parties and trial lawyers.The subprime lenders that were engaged in
predatory lending practices have
turned out to be a real sleazy bunch.
Sadly, they arent all payday lenders.
Banks and other financial institutions
let greed get them into deep water
without any obvious way to get out.
Hundreds of thousands of homeown-
ers are now facing foreclosure, and our

financial markets are reeling. Not only
did the Bush Administration do nothing
to protect consumers, it embarked on
an aggressive and unprecedented campaign to prevent states from protecting
their residents from the very problems
to which the federal government was
turning a blind eye in order to protect
the Administrators corporate patrons.
This is another sad chapter in the
legacy that will be left by George W.
Bush, Dick Cheney, and Karl Rove.
Source: USA Today
THE PAYDAY LENDERS REACH A NEW LOW

It has been reported that some
payday lenders are capitalizing on a
new line of business involving people
getting Social Security or other government checks.The payday loan industry
realized in recent years it needed to try
and change its sleazy image. It went on
the offensive and started a full-fledged
public relations campaign. This campaign was designed to counteract
media stories about desperate people
who got payday loans, were charged
usurious interest rates, and ended up in
even worse shape. Payday lenders
created a Council for Fair Lending.They
even had a code of ethics in an attempt
to show how they were dedicated to
running their businesses in a responsible and trustworthy way.A recent story
by The Wall Street Journal pretty well
shot down the payday lenders public
relations efforts. The story told of the
latest twist in payday loans, involving
people who get Social Security or other
government checks.The story featured
Alabama payday lenders and Alabamians who signed away their future benefits to get cash in a hurry.
Although the elderly and disabled
cant send their government checks
directly to the lenders, they can have
their checks deposited in a friendly
bank, which in turn will transfer the
money to the payday loan shops. The
payday lender takes his cut of the
checks, then gives the borrowers their
part. Taking advantage of elderly and

disabled folks is about as sorry and
lowdown as it gets.
What these payday lenders is doing
should be illegal. Unscrupulous lenders
should not be allowed to get their
hands on the benefits of some of the
most vulnerable members of our
society. But so far, the Alabama Legislature has not shown much interest in
stopping these predators. In fact, everything done in past sessions has been to
protect the industry.The law passed in
2003 actually legitimized the payday
loan industry, which was on the verge
of being shut down for charging interest rates higher than allowed under the
states Small Loan Act. Currently, under
that law, payday lenders can charge a
455% annual percentage rate on loans.
The people of Alabama should demand
that their legislators clamp down on
the payday lenders operating in
Alabama.
Source: Birmingham News
STATES FIGHT BACK AGAINST FORECLOSURE

FRAUD
Some states are taking action to
combat soaring foreclosure rates.Their
goal is to protect homeowners from a
new crop of scam artists who claim
they will rescue borrowers. At the
same time, some states are creating
funds that could provide affordable
fixed-rate mortgages to those on the
precipice of losing their homes. The
stakes are high: As many as 130,000
American homeowners, the most in 30
years, are going into foreclosure each
month. Some elected officials are
calling for federal legislation to prevent
predatory lending and asking lenders
to voluntarily hold off on raising mortgage rates for those most in trouble.
The following are some of the ways
states are trying to help:
Ohio, which has one of the highest
foreclosure rates in the country,
started taking applications last week
to give fixed-rate loans to homeowners with subprime adjustable-rate
mortgages whove seen their

monthly payments skyrocket beyond
their means.
Colorado is considering a law that
would make it a criminal offense for
appraisers to falsely inflate the value
of homes in mortgage proceedings.
Legislation is under consideration in
Indiana that would create free consumer counseling for homeowners
facing mortgage problems.
At least four states have set up task
forces to study foreclosures and recommend solutions.
At least a dozen states have enacted
laws designed to crack down on
fraud by so-called foreclosure consultants who claim to help homeowners in trouble.
The instances of fraud by so-called
mortgage consultants who promise to
save homes from foreclosure have
grown along with foreclosure rates.
New York is one of a dozen states,
including California, Colorado, Florida,
Georgia, Illinois and Michigan, enacting
laws that put limits on mortgage consultants. Foreclosure rescue fraud has
become a big problem across the
United States. In some parts of the
country, whole neighborhoods are
affected, according to Carolyn Carter, a
lawyer with the National Consumer
Law Center in Boston.
Source: MSN.com
FEDERAL PROSECUTORS LOOK AT MERRILL

LYNCH
According to a report in the Wall
Street Journal federal prosecutors have
asked the Securities and Exchange
Commission (SEC) for information
gathered from an investigation of
Merrill Lynch & Cos activities in mortgage securities.Apparently, the SEC has
been examining issues such as whether
Merrill booked inflated prices of mortgage bonds it held, despite knowing
the valuations had dropped. It was
unclear whether the SEC had already
27
handed over information to the U.S.

Attorneys office in Manhattan.As previously reported, Merrill recorded about
$24 billion in write-downs during the
second half of last year, mostly because
of its exposure to subprime mortgagerelated assets.
FBI AND SEC JOIN COMPLEX PROBE OF

HOUSING CRISIS
Investigators are probing dozens of
companies for fraud and insider trading
in connection with the subprime mortgage crisis. Currently, the FBI is conducting criminal investigations of 16
companies. The Securities and
Exchange Commission is probing
nearly two dozen more companies.
Attorneys General in at least four states
are also involved and class-action lawsuits that target home builders, lenders,
credit-rating agencies and the banks
that packaged groups of mortgages into
securities has been filed.
Pat Huddleston, a former SEC lawyer
who now runs InvestorsWatchdog, an
Atlanta, Georgia-based company that
provides vetting services for investors,
says that civil authorities would bring
several accounting fraud cases alleging
that brokerage firms inflated values on
subprime loan packages or disguised
their own losses on the bad investments. Firms may have been using different models to price securities on
their own books as opposed to those
of their clients. Unfortunately corporations hiding the truth from investors in
order to prop up their stock price is
nothing new. But that certainly doesnt
make it right.
KB HOME AND COUNTRYWIDE SUED FOR

INFLATING HOME PRICES
Two California couples are suing KB
Home and mortgage lender Countrywide Financial Corp., claiming the companies schemed with real estate
appraisers to inflate prices paid for
homes as the housing market began to
28
tank.The complaint, filed in Los Angeles

Superior Court, also names as a defendants KB Home Mortgage Co., Countrywide Home Loans Inc., Countrywide
KB Home Loans, a joint venture of
Countrywide and the builder; and two
real estate appraisers.The plaintiffs are
seeking unspecified restitution as
well as compensatory and punitive
damages. They also want class-action
status to cover KB Home customers in
California who obtained financing
through Countrywide and closed on
their purchases between August 1,
2005 and July 31, 2006.
In the lawsuit, the couples claim
prospective homebuyers were presented with false or misleading data on
previously sold homes in order to
justify higher asking prices on new purchases. KB customers were presented
with comparable sales data from
homes that were dissimilar, nowhere
near the KB property being sold, or
from sales that had not yet closed,
according to the lawsuit. When independent appraisers evaluated comparable home sales, the values were
between 10% and 15% lower than the
price the plaintiffs paid for their KB
homes. These practices propped up
falling prices into the summer of 2006.
The complaint suggests the alleged
scheme likely affected other KB customers.
Countrywides lending practices
have drawn consumer complaints and
litigation amid a surge in home loan
defaults as the housing market went
from boom to bust.A former employee
at Countrywide KB Home Loans sued
the company last month claiming he
was wrongly fired after he criticized
the firms lending practices.The lawsuit
contends the lender fired him after he
blew the whistle on fellow employees
and outlined instances in which
appraisers were being strongly encouraged to inflate homes appraised value.
METLIFE AND BLACKROCK ARE SUED OVER

ACCOUNT
Israel Discount Bank of New York has
filed suit against MetLife Inc. and
BlackRock Inc. in state court over
losses on subprime investments. IDB, a
New York commercial bank and a subsidiary of financial-services company
Israel Discount Bank Ltd., of Tel Aviv,
filed the lawsuit in New York State
Supreme Court. IBD also took out a
half-page advertisement about the case
in The Wall Street Journal on February
20th. The complaint alleges the defendants were in breach of contract and
their fiduciary duty by investing a
certain separate account in subprime
mortgage-backed securities that have
declined in value. The complaint also
alleges that MetLife didnt subsequently
transfer the money out of the account
despite IDBs repeated requests to do
so.
At issue is the Libor Plus account that
IDB used in connection with a privateplacement variable life insurance
policy offered through MetLife. The
account was subadvised by BlackRock
and generally sought to maximize total
returns measured in relation to the
three-month London interbank offered
rate, or Libor, according to disclosure
materials. Libor Plus documents stated
the account would primarily invest in
publicly traded debt such as U.S. government and agency securities, mortgage-backed
and
asset-backed
securities, and municipal debt. But,
certain account holdings have taken a
hit. By last August, Libor Plus held about
$100 million in assets, and the market
value of IDBs account was about $9
million, according to the complaint.
Late last year, IBD learned that 42% of
the account had been invested in
riskier securities related to subprime
mortgages. IDB said it requested the
funds in the account be moved in
November. But in an early December
letter, MetLife informed IDB it wasnt
filling its November reallocation
demand. Such losses can have a particularly severe impact on relatively small
employee life insurance funds like

those at IDB.
XII.
PREMISES
LIABILITY UPDATE
PARENTS OF POOL DROWNING VICTIM FILE
SUIT
The parents of a 6-year-old boy who
drowned after his arm got trapped in a
powerful underwater swimming pool
suction drain have filed a lawsuit alleging the pool violated safety requirements designed after a rash of similar
tragedies. The lawsuit was filed in a
Connecticut state court by the parents
against the town of Greenwich, Shoreline Pools, and others. The lawsuit
alleges Shoreline had a history of violating building code requirements, and
accuses the town of failing to conduct
a proper inspection before issuing a
permit.
The 6-year-old was trapped when his
arm became stuck in an intake valve on
the wall in the deep end.Water entering an intake valve is pumped through
the filtering system under suction
before being pumped back into the
pool.When the boy got trapped in the
pool underwater on July 26th, his father
and another adult jumped into the inground pool to try to free him but the
pools suction was too powerful. The
boys parents could not find a mechanism to turn off the suction pump.
Only after power to the house, including the pools drain pump was cut off,
was the father able to free his son and
perform CPR, but it was too late.
Since 1985, there have been more
than 150 reported cases of swimming
pool drain entrapments, leading to at
least 48 deaths and many serious
injuries, including disembowelment of
children and adults. Because of the
safety issues, Connecticut in 2004
implemented new safety requirements
for pool circulation systems. The
lawsuit contends the swimming pool

fell well short of minimum state
safety standards, containing seven
serious code violations, each of which
had the potential to cause fatal entrapment. Any proceeds from the lawsuit
will go to the familys Zac Foundation
for Childrens Safety, according to Paul
Slager, a Stamford, Connecticut lawyer
who is representing the family. The
victims father, who had been president
of SAC Capital Advisors, one of the
worlds largest hedge funds, resigned
recently. I am told he will continue to
be an advocate for safety in the swimming pool industry. Why hasnt Congress and every state legislative body
passed safety legislation to deal with
this problem?
Jeurissen settled his claim for $3.5

million, of which IHP was to pay $1.92
million,Triumph, $350,000; Epstein and
Sons, $787,500; and MGE $437,500.
Brad and Catherine Smith settled for $3
million, with IHP paying $1.65 million,
Triumph, $300,000; Epstein and Sons,
$675,000; and MGE $375,500. Terry
Younger settled for $2.5 million, with
IHP paying $1.37 million, Triumph
paying $250,000, Epstein and Sons
paying $562,500 and MGE paying
$312,500.Another 16 plaintiffs settled
for $1 million to be divided between
the claimants.Triumph, meanwhile, has
lawsuits pending in Jackson County
Circuit Court, mostly against insurance
companies, trying to recoup damages
from the explosion.
Source: USA Today
Source: Houston Chronicle
TRIUMPH TO PAY $12.3 MILLION IN

SETTLEMENT
MOTORCYCLE RACE PROMOTER LIABLE FOR

WANTON CONDUCT
A 2005 natural gas explosion that

ripped through a pork-processing
plant, killing one person and injuring
several others, has led to settlements
totaling nearly $12.3 million. Investigators determined that gas leaking from
an uncapped valve fueled the explosion which occurred in October of
2005 at the Triumph Foods plant in St.
Joseph, Missouri. The defendants
named in the lawsuits were plumbing
contractor IHP Industrial of St. Joseph,
Triumph Foods, construction management firm Epstein and Sons, and Southern Union Co., the parent company of
Missouri Gas Energy. The lawsuits
claimed the companies were negligent
in failing to follow procedural safeguards that could have prevented the
explosion.
Melinda Fisher, mother of Andrew
Bauer, 24, of Stewartsville, the masonry
worker killed in the explosion, settled a
wrongful death lawsuit in November
2007 for $2.25 million. In that settlement, IHP was responsible for paying
$1.5 million.Triumph, Epstein and Sons
and MGE were responsible for paying
$250,000 each. Injured worker Theo
Heartland Park, a racetrack operator

in Topeka, Kansas, entered into a track
rental agreement with SFX Motor
Sports.The agreement authorized SFX
to stage Formula USA Series and Championship Cup Series motorcycle races
at the track. SFX placed corner workers
at various stations along the track to
warn racers by flags when they needed
to proceed with caution or were
approaching an accident. During one of
the races,Arthur Wagner, a participant,
crashed into an unprotected concrete
barrier: was engulfed in flames; and suffered severe injuries. He filed a lawsuit
against Heartland, SFX, Clear Channel
Communications, Inc., and the track
lessor, alleging negligence and wanton
failure to provide protection.The District Court dismissed all parties except
Heartland and SFX.The court also dismissed the negligence claim against
both of those defendants based on a
pre-race release signed by the plaintiff.
The jury found SFX as race promoter
liable for the plaintiffs injuries, but
found Heartland, as track operator, free
of fault.The District Court stated that to
establish wanton conduct under
29
Kansas law, a plaintiff must show that

the defendant realized the imminence
of danger and recklessly disregarded, or
showed a complete indifference or
lack of concern for, the probable consequences of the wrongful act. Circumstantial evidence is sufficient to prove
wanton conduct. Preventative measures can preclude a finding of wanton
conduct, but only if the measures materially lessened the chances of injury.
The District Court found that:
there was sufficient evidence for a
jury to find that SFX knew that the
corner where the accident occurred
was dangerous,
that there was a lack of sufficient
safety measures, and
that SFX recklessly
obvious dangers.
disregarded
The verdict included $264,625 for

non-economic loss to date, $758,150
for future economic loss, and $263,380
for loss of services as a spouse. The
total was $1.3 million in non-economic
losses and $1.2 million as economic
losses. SFX asserted that the Kansas
statutory cap on non-economic
damages should have been applied to
the damage award.The court reduced
the non-economic damage award to
$250,000 under applicable Kansas law.
Although the plaintiff had argued that
the loss of services award should be
considered an economic loss, the court
held that because there was no evidence as to the monetary value of
spousal services, it was a non-economic
loss award. All of SFXs post-trial
motions were denied, except for the
reduction of the non-economic loss
award to $250,000 total.
AGENCY SUED OVER DEATH OF

FIREFIGHTER AT TOWER
The sister of one of the two firefighters killed in August of last year fighting
a fire at the former Deutsche Bank
building in New York City has filed suit
against the government agency that
30
owns the building and several contractors, charging they knowingly created
dangerous conditions that led to her
brothers death.The plaintiff contends
that her 53-year-old died because of
conditions caused during the dismantling of the building, including piles of
combustible debris, dismantled fire
connections, compromised stairwell
walls, and barricaded exits.The lawsuit
says the Lower Manhattan Development Corporation, which owned the
building, and several private companies
knew of the potentially fatal conditions
before the fire.
Neither New York City nor the citys
Fire Department was sued, even
though city officials relieved three
senior fire officers of their posts about
10 days after the fire. The conditions
created by the defendants were too
much for the firefighter to withstand,
according to the complaint, and he was
killed by toxic smoke, unable to escape
because of the stairwell barricades
erected by the defendants.The Lower
Manhattan Development Corporation
and the contractors at the site knowingly created those conditions, according to the plaintiffs lawyer, who says,
they had a responsibility to let the firefighters know, and they failed to do
that.The suit seeks unspecified punitive and compensatory damages. The
two firefighters died when a broken
standpipe in the basement could not
deliver water to the fire, which fire
marshals said was probably started by a
cigarette.The family of the second firefighter killed will also file suit.
MAN RECEIVES $18 MILLION IN LAWSUIT

RESULTING FROM A FALL INTO OPEN
MANHOLE
Trigen-Philadelphia Energy Corp., the
company that operates the steam system
under Philadelphia streets, will pay $18
million to a former University of Pennsylvania medical student who broke his
back when he fell 18 feet into an open
manhole in 2004. Prior to the trial, the
parties to the lawsuit had entered into a
high-low agreement.The jury returned a

verdict for the plaintiff in the amount of
$85 million. But under the high end of
the pretrial agreement the plaintiff will
only receive $18 million. Because of the
agreement, no matter what the jury
verdict was the defendant will pay the
top end. There will be no post-verdict
motions and no appeal as a result of the
high-low agreement.
Gustafsson, a graduate of Germantown Friends School and Brown University, was working toward both a
medical degree and a doctorate in
molecular biology. He has completed
the biology degree, but hasnt been
able to finish his medical education
because of difficulty standing for long
periods during clinical work.The trial
showed that Trigen had known for 10
years that homeless men were removing manhole covers. In fact, it has
welded some of them closed.
Source: Inquirer
XIII.
WORKPLACE
HAZARDS
OSHA HIT FOR LACK OF SAFETY RULES
ON DEADLY DUST EXPLOSIONS
Top federal safety officials urged the
Labor Department in 2006 to adopt
critical regulations to prevent deadly
dust explosions like the deadly blast
in a Georgia sugar plant last month. But
for some reason the government has
failed to do so. Over the past 28 years,
about 300 dust explosions have killed
more than 120 workers and injured
several hundred others in sugar plants,
food processors, and many industrial
and wood manufacturers. Most could
be prevented by removing fine-grain
dust as it builds up. But that has not
been required by the federal Occupational Safety and Health Administration
(OSHA). The U.S. Chemical Safety
Board, which investigates industrial
accidents, concluded in a report in
2006 that OSHA had no comprehensive
regulation to prevent dust explosions

and that its program inadequately
addresses the problem.
A 20-year-old OSHA dust regulation
aimed only at grain plants and silos is
effective, according to the Safety Board.
It shows why regulations are needed
for other companies. OSHA officials
began stepped-up enforcement on dust
issues in October, but other safety officials say thats not enough and that
detailed dust safety regulations are
needed. Former Safety Board chairwoman Carolyn Merritt told the Associated Press:
This is an extremely dangerous
component that is not regulated.
Dust explosion situations are so
dangerous that people have got to
pay attention to this.There should
be an outcry.
Minuscule dust particlesthe smaller,
the more explosiveoften form clouds
in enclosed places, like manufacturing
plants or sugar mills. These clouds are
the perfect fuel for a fire that can be set
off by any spark or form of ignition.The
first explosion kicks up more dust, and
even more and bigger explosions follow
in rapid succession, according to James
Dahn, president of Safety Consulting
Engineers. Concerning the problem, Mr.
Dahn observed:
The biggest problems we have in
plants is that people are not
aware of the amount of dust
thats in their plant. Ive walked
into plants where dust is nearly
half a foot deep and people are
saying, Its just dust, we dont
worry about it. They did when it
blew the plant apart. Dust can be
an explosive hazard.
By law OSHA was supposed to
respond within six months to the
Safety Boards November 2006 recommendations to adopt a mandatory regulation. Except for a letter a year ago
acknowledging receipt of the report
and its recent special enforcement
emphasis, OSHA hasnt responded. Ms.
Merritt, who was appointed in 2002 by

President Bush and left the Board last
year, said she and her colleagues repeatedly pressed OSHA to do something.
Guy R. Colonna, an official with the
National Fire Protection Association
(NFPA), says his organization drew up
voluntary guidelines 85 years ago,
which, combined with other building
safety standards, guard against fires.
Many companies and cities have
adopted NFPAs standards, which the
Chemical Safety Board says are effective. Dust explosions have been around
for more than a century, including a
sugar mill explosion in Chicago in 1890
that killed 11 people. In 1985, OSHA
officials even met with the Georgia
plants owners at the time and told
Congress that powdered sugar and
other food dust are considered to be
strong explosion hazards. Just last
year downtown Baltimore was rocked
when a Domino sugar refinery had a
dust explosion.Three major explosions
at a variety of plants in 2003 prompted
the Safety Board to study the issue and
make its recommendations.
SUGAR REFINERY HAD PRIOR EXPLOSION

Dust that collected in a piece of
safety equipment caused a small explosion at the Georgia sugar refinery
weeks before the recent deadly blast
that killed nine workers, according to a
federal investigator. Thus far, the official, Stephen Selk, who is Investigations
Manager for the federal Chemical
Safety Board, has furnished few details
about the previous explosion at the
Imperial Sugar refinery in Port Wentworth. He wont say whether the
earlier explosion, in which nobody was
injured, contributed to the February 7th
blast.Apparently minimal damage was
incurred and that was quickly repaired.
The refinery was equipped with fans
and ducts designed to prevent dust
explosions by sucking particles out of
the plant and transferring them to dust
collectors on the roof. It was inside one
of those rooftop dust collectors where

the minor explosion occurred weeks
before blast of February 7th, which was
caused by clouds of tiny sugar dust particles that, when airborne in confined
spaces, can ignite like gunpowder.
DAMAGES AWARDED TO FORMER DUPONT

WORKER
A New Jersey jury has awarded a
former DuPont Co. worker more than
$1.2 million in damages after he
accused the company of retaliation for
reporting toxic hazards at the Chambers Works plant in Deepwater, New
Jersey. The jury awarded the former
worker, Jack Seddon, $724,000 in economic damages and $500,000 in punitive damages after a four-week trial.
DuPont was sued under New Jerseys
whistleblower law.
In October 2003, Mr. Seddon, who
was then an employee of DuPont, complained to the Occupational Safety and
Health Administration about risks of
leaks from a reactor containing toxic
phosgene gas, an industrial chemical
that was used as a deadly weapon
during World War I. Mr. Seddon, who
had been with DuPont for 30 years,
said he was investigated, suspended
with pay, and placed on probation after
returning to work. He eventually left
the Deepwater plant on disability. Neil
Mullin, one of Seddons lawyers, says
that,they destroyed his reputation and
career. Thats the way they paid him
back for blowing the whistle. An
outside expert testified that the
reactor could have created a 1,000-by1,000-foot deadly plume if only 10% of
its contents had escaped. The trial
judge will award attorneys fees to the
plaintiff, to be paid by DuPont.
Source: The News Journal
WOMAN HURT IN NYC STEAM EXPLOSION

SUES UTILITY
A woman who almost lost part of her
leg in a Manhattan steam explosion
31
that occurred last summer has filed suit

against Consolidated Edison.The plaintiff, who spent months in the hospital,
claims the utility was responsible for
her severe injuries.The lawsuit follows
a state Public Service Commission
hearing in which it was revealed that a
Con Ed employee had warned that an
84-year-old pipe at the center of the
July 18 explosion needed to be
replaced. During the PSC hearing, a
June 2006 picture of the pipe that
erupted was produced, along with a
notation.The employee who took the
photograph wrote: Pipe is dented &
pitted in several places. Should change
pipe!
A PSC staff member said dents in the
pipes were also detected in March
2005. Ken Thompson, one of the lead
plaintiffs lawyers in the case against
Con Ed and the city, said the picture
was evidence of reckless indifference
on the part of Con Ed. He added
Based on this evidence, Con Ed had to
know there was a problem with their
pipe.They left that dangerous pipe in
the ground to explode, and ran a safety
risk. How many other steam pipes are
also in a dangerous condition that Con
Ed knows about and has failed to take
action? The blast left three people
severely injured, including two persons
who were badly burned escaping a tow
truck.Another woman had a fatal heart
attack blamed on the explosion. More
than 100 businesses were affected and
at least 20 people have filed lawsuits
alleging they were injured.
federal labor officials. Roberto Sanchez,

the Birmingham-area director for the
Occupational Safety and Health Administration, observed:
Finding repeat violations at three
different job locations demonstrates to us that Gilco Contracting is indifferent to its employees
safety.
The company has 15 days to contest
the citations. Inspectors visited the job
sites in August 2007 and November
2007. Gilco Contracting was cited for
seven repeat citations totaling
$315,000 for not following OSHAs
rules regarding protection of employees in trenching and excavating operations. The Tuscaloosa contractor had
received citations for similar violations
after inspections in May 2005 and
October 2006.The company was also
cited for three serious violations, with
a fine of $10,800, for not keeping conveyor belt work areas free from fall
hazards and other unsafe conditions.
OSHA issued three other citations
with a fine of $2,700 for recordkeeping violations.
DYCOM TO SETTLE CLAIMS FOR $10

MILLION
The federal Occupational Safety and

Health Administration (OSHA) has proposed $328,500 in fines for Gilco Contracting Inc., a firm based in Tuscaloosa,
Alabama. The company allegedly
exposed workers to serious and
repeated safety hazards at two job sites
in Lakeview, Alabama and another in
Northport, Alabama according to
Dycom Industries Inc., which provides contracting services to telecommunications businesses, has agreed to
settle wage and hour claims against
three of its subsidiaries for $10 million.
The claims against its UtiliQuest LLC,
STS LLC and Locating Inc. units cover a
period from 2003 through January 31,
2007. Several states in which the subsidiaries did business are involved.The
$10 million settlement is subject to
court approval and is the maximum
payout assuming all those eligible
accept the settlement terms.The settlement is part of a structured mediation
process. In order to get court approval
for the process, lawyers have filed complaints in the U.S. District Court in the
Middle District of Florida. Dycom says
32
$328,500 IN FINES PROPOSED FOR

ALABAMA CONTRACTOR
subsidiaries have changed practices to

avoid further litigation.
FORMER FEDEX WORKER AWARDED

DAMAGES
A jury in Houston,Texas, has awarded
$2.9 million to a former employee of
FedEx Corp. in a discrimination
lawsuit, finding the delivery company
retaliated after the worker leveled
charges of race discrimination against
the company.The employee worked in
security at FedEx in Houston when he
sued the company in 1999 after he was
passed over for promotion. The suit
was dismissed and the worker lost his
appeal in 2002. Later that year, the
worker, who is black, began receiving
reprimands from his supervisors about
his work performance. A second suit
was filed. The workers job was to
investigate reports of lost packages and
allegations of employee time-card
fraud.When he tried to tell his side of
the story by getting statements from
his co-workers to rebut claims that he
dealt with a customer unprofessionally,
he was reprimanded for that.
The worker, who joined FedEx in
1984, was terminated in 2005 after
receiving his third warning letter in 12
months, according to his lawsuit. The
jury award included $2.5 million in
punitive damages. The trial judge will
award attorneys fees and future earnings for the worker. The worker, who
was earning $65,000 a year when he
was at FedEx, is an airport screener in
South Carolina and earns $13,000 a
year for the part-time job.The jury obviously felt that FedEx needs to learn a
lesson and that it had to pay force
FedEx to a substantial amount of
money to get FedExs attention. G. Scott
Fiddler, an employment lawyer in
Houston, represents the worker.
Source: Houston Chronicle
XIV.
TRANSPORTATION
MOTOR VEHICLE CRASH LAWSUIT SETTLED
A woman, who was badly injured
when her car slid into a tree on a
stretch of a county road, a road that
was described as treacherous, will
receive $13 million in a settlement.This
is the largest personal injury settlement
in Nassau County, New York history.
The accident, involving 37-year-old
Merryl Kihl, occurred in the early hours
of January 13, 1995.The short stretch of
road had been the scene of numerous
bad vehicle crashes, including one fatal
crash in which the car hit the very
same tree.The county was not allowed
in Kihls case to argue that the road
was safe because of earlier court
rulings. A jury rendering a $3 million
verdict in favor of the children of the
other victim, later reduced, found the
stretch of road to be unsafe.
The jury verdict in the case had been
appealed.The victim suffered a broken
neck and other injuries in the crash,
and operations to ease her pain caused
further complications. She has had
spinal fusion surgery, undergoes pain
management treatments, and takes a
combination of narcotics, analgesics
and muscle relaxants.The woman has
a morphine pump implanted in her
stomach, which must be replaced
every four or five years for as long as
she lives. Her doctors testified that her
pain was intractable and unremitting,
and that it would increase over time.
Once the appeals court upheld the jury
verdict a the settlement came shortly
thereafter.
Source: NewsDay.com
FAMILY OF FERRY ACCIDENT VICTIM SETTLES

LAWSUIT
The survivors of a truck driver who
died when his tractor-trailer rolled off
the stern of a Cross Sound ferry
between Long Island, New York and
Connecticut five years ago have

received a settlement of more than $3.2
million from the ferry company and the
Workers Compensation Commission.
The ferry company has added safety
equipment as a result of the accident.
Michael Zuber, 53, a father of three, was
hauling a rock crusher from Branford,
Connecticut, to Long Island when he
boarded the ferry in New London, Connecticut, back in 2002. The ferry was
less than a mile away from the dock at
Orient Point, New York, when the truck
rolled off the back of the boat and sank
into the turbulent waters of Plum Gut.
Mr. Zuber was found unconscious in an
oil slick and was pronounced dead at a
local hospital.
Mr. Zubers wife of 20 years sued the
ferry company alleging that the ferry
crew had not secured the trucks back
wheels with blocking devices known
as chocks. Also, the crew allowed Mr.
Zuber to stay in the trucks cab during
the trip despite the companys policy
that passengers leave their vehicles
while the ferry is under way.The ferry
crews have said they often allowed
truck drivers to remain in their cabs to
catch up on their rest.Apparently, that
was a common practice.
In October 2007, the ferry companys
insurer, settled the case for $2.25
million and a Probate Court approved
the agreement. Mr. Zubers widow and
his estate also received around $1
million from the Workers Compensation Commission. Multiple witnesses
had testified at depositions that the
trucks wheels were not chocked, and
the ferry company admitted to that.The
defendant took the position that Coast
Guard regulations relating to chocking
were ambiguous and legally they didnt
need to chock the truck.The brakes on
the truck, which was manufactured in
Europe, failed when pinhole leaks
caused the air to bleed out. Interestingly, had the truck been made in
America, the brakes would have locked
when the air pressure bled out. But, this
tragedy wouldnt have happened even
if a single chock had been used. Had the
crew enforced the policy of not allowing passengers to stay in their vehicles,
Mr. Zuber would have been safe in the
ferry cabin. William M. Bloss, of the
Bridgeport, Connecticut, law firm of
Koskoff Koskoff & Bieder, represented
the family.
Source: theday.com
$1.1 MILLION AWARD TO 3 FERRY WORKERS

FOR GAS EXPOSURE
Three Washington State Ferries
workers have been awarded more than
$1.1 million for injuries they suffered
because of exposure to chlorine gas on
the ferry Tacoma in 2004.According to
the lawyer for the men, the ferry
system allowed the absorbent powder
Hi N Dri and bleach on the ferries
without investigating the potential
harm from combinations of the chemical products during normal cleaning
operations. When the workers were
cleaning a restroom, the products
created a toxic cloud of chlorine gas,
causing them coughing, shortness of
breath and wheezing that will require
lifetime medications. The court found
that the chlorine gas which resulted
from the mixture of Hi N Dri and
bleach constituted an unseaworthy
condition. All three of the crew
members, who were exposed to the
chlorine, developed significant and
permanent occupational asthma. The
judge ruled that the storage and combination of Hi N Dri and bleach was
neither reasonably fit for its intended
use, nor a safe method of operation.
This was a most interesting case.
Source: Seattle Times
WOMEN STRUCK BY BUS WINS HER CASE

A Middlesex County, Massachusetts,
jury awarded $10 million to a 58-yearold woman who suffered brain damage
when she was hit by a Massachusetts
Bay Transportation Authority (MBTA)
bus while waiting to get to work.
Louise Scialdone, who is unable to
33
work and has trouble with her balance

and her memory, is sensitive to light
and noise and, though formerly an avid
reader, she can now handle only thirdgrade-level reading material.
With interest, the MBA will owe Ms.
Scialdone close to $12.8 million from
the date the suit was filed.The Authoritys insurance will apparently cover
damages only beyond the first $7.5
million.The financially troubled agency
had already been expecting to run a
$75 million deficit in the coming
budget year that begins in July. Ms.
Scialdone will use the money to
upgrade her care, which she needs
around the clock, at a cost of about
$200,000 a year. She will move from a
nursing home to a brain injury rehabilitation center.
Ms. Scialdone, who used a walker
because of arthritis, was waiting at a
bus stop, on her way to work.The bus
driver lost control of the vehicle on the
icy road, fishtailed onto the sidewalk,
and knocked Ms. Scialdone off her feet,
throwing her some 5 feet. Her head hit
a parked car, knocking her unconscious.The bus driver was traveling too
fast for the slick roads. A witness estimated that the bus, which was out of
service, was moving about 30 miles per
hour. Paul Mitchell and John DeSimone
represented Scialdone at trial.
Source: Boston Globe
CELL PHONE USE IN CAR RESULTS IN $5.2

MILLION SETTLEMENT
International Paper Co. has agreed
to pay $5.2 million to settle a personal
injury suit related, at least in part, to
one of its employees use of a cell
phone while driving.According to the
complaint filed in Fulton County,
Georgia, Superior Court in 2006, an
International Paper employee was
using her company-supplied cell
phone as she drove west along an
interstate highway near Dublin,
Georgia, when she rear-ended a
vehicle driven by Debra Ford.The collision pushed Ms.Fords vehicle into
the ditch on the right side of the road,
34
overturning it so that the drivers side

hit and then slid along the roadway
with Ms. Fords arm trapped between
the door and the asphalt. Medical
complications eventually forced Ms.
Ford, a widowed mother of four, to
have her arm amputated almost up to
the shoulder.
There is a cell phone statute in
Georgia that says a driver of a motor
vehicle is not to do things that are distracting.This essentially means reasonable cell phone use may be acceptable
within the purview of the statute.The
International Paper employees cell
phone use was, however, not reasonable.The employee had set her cruise
control at 77 miles per hourin a 70
mph speed zoneand thats not good.
The combination of using her cell
phone and 77 mph speed raised the
issue of intentional negligence on the
part of the employee and International
Paper, and allowed for the jury to consider and award punitive damages.
International Paper contended that
the employee was not actually on the
phone at the moment the collision
occurred. The employee testified in a
pretrial deposition that she had used
the cell phone just before getting on
the interstate, and the accident
occurred nearly two miles later. A
witness, however, testified that he had
seen her with the phone to her ear at
the time of the collision. Katherine L.
McArthur, a Macon lawyer, who has
published several articles on the
dangers of cell-phone use while driving
a vehicle, represented the plaintiff and
did a very good job.
Source: Fulton County Daily Report
POTENTIALLY DANGEROUS CONDITIONS

REPORTED AT AIRPORTS
It is being reported that there are
not enough air-traffic controllers at our
nations airports.This shortage not only
causes flight delays, but it has the
potential of having an effect on the
safety of commercial aviation. Fully certified controllers have, according to a
report in the Wall Street Journal, been
retiring in droves over the past

several months. Some of this was
expected because many controllers
hired after the 1981 air-traffic controller strike are becoming eligible to
retire. You will recall that President
Regan fired more than 12,000 controllers in 1981 because of that strike.
But the retirement surge has apparently
accelerated beyond the projections of
the Federal Aviation Administration
(FAA) projections because of a bitter
labor feud that has dragged on since
2006.
In January, there were roughly
11,000 fully certified controllers,
marking the lowest level in more than a
decade. In September 2002, the FAA
employed 12,801 fully certified controllers. The National Air Traffic Controllers Association, which represents
the FAAs work force of roughly 15,000
fully and partially certified controllers,
has declared staffing emergencies at
high-intensity facilities in Atlanta,
Chicago, Dallas, New York, and Southern California.The Association calls the
loss of so many veteran controllers a
growing crisis amid surging traffic
volumes.The FAA says in efforts to stabilize the situation, the agency is hiring
hundreds of trainees and offering
bonuses of as much as $24,000 to
retain wavering controllers. But the
pace of departures is leaving fewer
experienced eyes to watch over the
skies and thats not good!
HELICOPTER CRASH LAWSUITS SETTLED

Three families have agreed to settle
their lawsuits over a 2002 medical helicopter crash in Norfolk, Virginia, that
killed three people aboard.The details
of the settlement were still being negotiated at press time.The LifeNet of the
Heartland helicopter had just left a
Norfolk hospital on June 21, 2002,
when the pilot reported trouble. It
crashed at the airport. Killed in the
crash were the pilot, an emergency
room nurse, and a paramedic.
The National Transportation Safety
Board ruled in 2004 that a faulty tail

rotor and an inexperienced pilot were
the likely causes of the crash. Other
factors included the binding of a mechanism controlling the tail rotor, gusty
winds, and the pilots lack of experience with that type of helicopter,
according to the agency. Rocky Mountain Holdings, LifeNets parent
company, and its insurer were also
listed as plaintiffs in the lawsuit along
with the families.
The lawsuit in Lancaster County District Court originally named more than
a dozen different defendants who
played some role in the design, manufacture, sale, or operation of the helicopter.The judge has dismissed several
defendants from the case including
Duncan Aviation of Lincoln; CIT
Leasing Corp.; and Societe D Applications Des Machines Motrices. The
remaining defendants include American Eurocopter; Eurocopter S.A.; Turbomeca Engine Corp.;Turbomeca, S.A.;
and Dunlop Limited. Gary Robb of
Kansas City, Missouri, represented the
families and did good work as usual.
THE LOGGING INDUSTRY IS LARGELY

UNREGULATED IN OUR STATE
Over the years we have all observed
log trucks traveling on the highway.
This is especially true if you live in the
southeast region of the United States
and have driven in rural areas where
timber is a big commodity. Most American citizens assume trucks hauling logs
are regulated.Thats because commercial trucks are regulated by the Federal
Motor Carrier Safety Regulations
(FMCRS). But log trucks are not regulated, at least not in Alabama and
Georgia.1
In Alabama, log trucks and other
commodity haulers are exempt from
the Alabama Motor Carrier Act (Code of
Alabama 37-3-1 et. seq.) pursuant to
the Public Service Commission Rule
2.2 or Code of Alabama 47-3-4(c),
which addresses exempt commodities.

Because most log trucks are intrastate
carriers as opposed to interstate carriers, the safety regulations adopted by
the Alabama Public Service Commission dont apply to the log trucks in
Alabama.The safety regulations in the
Act would cover areas such as driver
qualifications, log books, truck equipment, and reporting requirements.
In January of 2006, the Forest
Resource Association released a study
of heavy truck accidents between 1991
and 2004 in the State of Georgia.This
study showed that log trucks were
three times more likely to have accidents because of mechanical failures
than other heavy trucks.The most cited
cause of log truck accidents was driver
decision and/or behavior.This generally
relates back to the issue of training. Statistics from the Alabama Department of
Public Safety reveal the number of
times that inspectors made companies/
owners park (out of service) their rigs.
The following data tell the story relating to the out-of-service percentages
for three years: 55% of the log trucks
inspected in 2002 were put out-ofservice, 71% in 2003 and 63% in 2004.
The statistics available for 2005 are
skewed because regulations were
relaxed, following the hurricanes of
Ivan and Katrina: compared to all
trucks inspected in Alabama, only 25%
of the log trucks were put out of
service.
In January of 2007, all intrastate
trucks were required to have a DOT
number affixed to the truck. This has
allowed inspectors to keep better
records of companies who are repeat
violators. The reason why most states
have regulations that are not as stringent as the Federal Motor Carrier Safety
Regulations is because the timber
industry lobbied state legislatures to
pass laws that exempted the timber
industries and loggers from the regulations.When a log truck is involved in a
wreck, a contributing factor is usually a
safety or driver issue. If the stringent
Federal Motor Carrier Safety Regulations were applicable to log trucks, I

am convinced that the number of accidents involving log trucks would be
reduced sharply.
XV.
ARBITRATION
UPDATE
SEX ASSAULT SUIT AGAINST HALLIBURTON
KILLED
We wrote in a recent issue about the
Halliburton case involving a mother of
five who was sexually harassed and
assaulted while working for Halliburton/KBR. Her case is now headed for a
highly secretive arbitration process
rather than being presented to a court
and jury.A judge in Texas has ruled that
Tracy Barkers case will be heard in
arbitration because of terms in her
initial employment contract. Ms. Barker
says that while in Iraq she was constantly propositioned by her superior,
threatened, and isolated after she
reported an incident of sexual assault.
Her
lawyers
argued
that
Halliburton/KBR had created a boys
will be boys atmosphere at their
camps and what Ms. Barker was put
through was not the type of dispute
that she could have expected to be
within the scope of an arbitration provision. However, District Judge Gray
Miller, disagreed and wrote in his order:
Whether it is wise to send this
type of claim to arbitration is not
a question for this court to decide.
Sadly, sexual harassment, up to
and including sexual assault, is a
reality in todays workplace.
KBRs efforts to have all of this
womens claims heard in private arbitration, instead of a public courtroom,
as provided under the terms of her
original employment contract, have
been successful. In arbitration, there is
1 In Georgia, the state legislature has adopted regulations published by the Georgia Public Service Commission, known as The Georgia Forest Product Trucking Rules.
35
no public record or transcript of the

proceedings, meaning that her claims
will not be heard before a judge and
jury. Halliburton, which has since
divested itself of KBR, is trying hard to
distance itself from this matter. If this
case doesnt get the attention of Congress on the evils of arbitration, nothing
will. Arbitration was intended to
involve only disputes between large
corporations. Never in their wildest
dreams did the members of Congress,
who voted for the FAA when it was
passed ever contemplate cases like that
involving Ms. Barker going to arbitration for resolution.
United States shall not be enforceable.

There are two exceptions to this ban.
One is for post-dispute arbitration
agreements.Therefore, employees and
employers would be allowed to agree
to use arbitration to resolve their differences after a dispute arises.The other
exception is for arbitration clauses in
collective bargaining agreements. If
enacted, the proposed legislation
would have retroactive effect.
Source: ABC News
The Public Investors Arbitration Bar

Association (PIABA), a national association of lawyers who represent
investors in arbitrations against the brokerage industry, has urged the Financial
Industry Regulatory Authority (FINRA)
and the Securities and Exchange Commission (SEC) to take immediate remedial action to reform mandatory
investor arbitration. The results of a
new survey confirm that investors
view securities arbitration as biased
and unfair.The survey, conducted under
the direction of the Securities Industry
Conference on Arbitration (SICA), was
in response to a 2002 evaluation of the
fairness of arbitration funded by the
SEC.The SEC-sponsored evaluation had
recommended an empirical analysis of
investors perceptions of fairness in the
arbitration process. SICA was created in
the 1970s at the behest of the SEC to
maintain a uniform code of arbitration
procedure and to serve as a sounding
board on issues of importance to the
arbitration system. Laurence S. Schultz,
President of PIABA, observed:
CIVIL RIGHTS BILL WOULD BAR MANDATORY

ARBITRATION IN WORK CONTRACTS
Sweeping civil rights legislation has
been introduced in Congress that,
among other things, would amend the
Federal Arbitration Act (FAA) to create a
broad exception in Section 1 for
employment agreements and make predispute arbitration agreements in these
agreements unenforceable.The thrust
of the legislation (S. 2554 and H.R.
5129) is to guarantee individuals a
private right of action under civil rights
laws to challenge disparate impact discrimination.The FAA, which generally
makes enforceable arbitration agreements in contracts affecting commerce, contains an exemption in
Section 1 for contracts of employment
of seamen, railroad employees, or any
other class of workers engaged in
foreign or interstate commerce.
The proposed legislation would call
for certain language to be removed
from FAA Section 1, so that this provision would say that the FAA does not
apply to contracts of employment. Furthermore, it would create a ban on arbitration clauses in employment
agreements by providing, Notwithstanding any other provision of law, any
clause of any agreement between an
employer and an employee that
requires arbitration of a claim arising
under the Constitution or laws of the
36
Source: ADRWorld.com
INVESTORS NEGATIVE VIEW OF ARBITRATION

SUPPORTS NEED FOR REFORMS
The SICA survey confirms once

and for all that investors who
have been involved in arbitration
distrust the arbitration process
and have concluded it is biased
and unfair. And although the
industry and FINRA may not like
the results, they must accept them.
The survey was sponsored and
overseen by an independent
organization with input from all

participants in the arbitration
process. Now its time to make fundamental changes to make the
system fair.
The survey received responses from
over 3000 investors nationwide who
had been involved in arbitration. Over
62% believed the arbitration process
was unfair, 60% had an unfavorable
view of arbitration, and 70% were dissatisfied with the outcome. Schultz
pointed out that these results should
be of little surprise since well over half
of investors who arbitrate their cases
against the brokerage industry get a
zero award; and based on a study of
awards made in 2006, those who
recover are awarded an average of just
over 10% of the amount claimed.Worse
yet, investors, whether they win or
lose, are typically assessed fees by arbitrators that can run into several thousands of dollars.The time has come to
clean up the investor arbitration
process. Investors shouldnt be forced
to submit their valid claims to an arbitration process that is run and controlled by the brokerage industry.
Source: Newswire
XVI.
NURSING HOME
UPDATE
GOVERNMENT LISTS WORST NURSING
HOMES
After initially resisting their disclosure, the Bush Administration has
finally allowed the names of 131
nursing homes with poor inspection
records to be made public. The list
released by the Centers for Medicare
and Medicaid Services identifies troubled facilities cited as a special focus
facility, a designation used to identify
those that merit more oversight. For
these homes, states conduct inspections at six-month intervals rather than
annually.
Last November, the government
released a partial list of 54 nursing

homes that ranked among the worst in
their states, balking at releasing the full
list of homes with the special focus
designation.After a group of Democratic lawmakers began pushing for full
disclosure, CMS agreed to publish the
names. CMS will update its list of troubled nursing homes on a quarterly
basis, with its next release scheduled
for April.
The list shows 52 nursing homes as
not showing improvement after they
were cited as a higher-risk nursing
home, while another 52 did show
some improvement. Twenty-seven
nursing homes were added to the list
in the last six months. Out of the 54
nursing homes initially disclosed as
poor performers last November, 21
have shown improvement, CMS said,
adding that publicity about the problems might have played a factor.There
are about 16,400 nursing homes
nationwide, and taxpayers spend
about $72.5 billion annually to subsidize nursing home care.
Most nursing homes have some deficiencies, with the average being six to
seven deficiencies per survey. But, the
special focus facilities typically have
about twice that number, and continue
to have problems over a long period of
time. The states determine which
nursing homes should get the designation, and inspection standards vary
among the states.The offenses typically
involve unnecessary use of medication
for elderly residents, or inadequate safeguards to protect residents such as
those with Alzheimers from day-to-day
hazards in the nursing home. Americans should have access to as much
information about a nursing home as
possible, and making information like
this known to the public is necessary.
JURY AWARDS BURN VICTIM $1.5 MILLION

An assisted-living home and the state
must pay $1.5 million in damages for
the first- and second-degree burns a
mentally disabled man suffered when

he was placed in a tub of scalding
water. A Madison, Indiana Superior
Court jury found in favor of Audrey
McGhees estate against home operator
Residential CRF Inc. and the Indiana
Family and Social Services Administration. Residential CRF of Connersville,
Indiana provides services to developmentally disabled clients through an
agreement with Family and Social Services. Mr. McGhee, who lived at the
now-defunct New Castle State Developmental Center until 1998, was placed in
a Residential CRF-operated home in
Anderson, Indiana the following year.
The jury decided Residential CRF
must pay $1.125 million in damages,
while Family and Social Services owes
$375,000. Charles R. Clark, a lawyer in
Muncie, Indiana who represented
McGhees legal guardian, First Merchants Bank. During the trial plaintiffs
counsel argued that the 42-year- old
plaintiff deserved about $1.4 million
from the defendants to cover individualized care for the rest of his life, which
counsel estimated at 30 years. Mr.
McGhee was said to have the mental
aptitude of a baby, has cerebral palsy,
and is blind, mute and deaf.
Source: Courier Journal
CLAUSES IN NURSING HOME AGREEMENTS

VIOLATE THE LAW
A study by the National Senior Citizens Law Center has found that some
admission agreements ignore the laws
in some states, as well as federal laws,
and mislead consumers about the care
they can expect.The residents families
are induced to sign away critical consumer protections. Elderly consumers
and their families should be wary when
signing long and often complex
nursing home agreements, according to
this new study.
The National Senior Citizens Law
Center, a Washington-based nonprofit
legal advocacy group for seniors and
elder-care lawyers, reviewed 175 admission agreements voluntarily provided
by nursing homes. The study found

agreements that improperly limited a
nursing homes obligations. Others
allowed discharges for vague reasons,
or stuck relatives with bills they legally
didnt owe.
Eric Carlson, the author of the study,
said that some of the agreements conflict with the federal Nursing Home
Reform Law and laws in some states.
The federal law requires nursing homes
to provide care that helps residents
reach the highest practicable level of
functioning. But Mr. Carlson said some
agreements instead attempt to get
seniors or their families to lower their
expectations of care and assume more
of the risks of injury, such as falling or
choking. Nursing homes cant be
allowed to ignore existing law and
require residents and their families to
give up legal rights.
Source: Kansas City Star
XVII.
HEALTHCARE
ISSUES
PFIZER WILL PULL SOME LIPITOR ADS IN
WAKE OF PROBE
Pfizer Inc. has pulled its advertisements featuring Dr. Robert Jarvik, the
inventor of an artificial heart, marketing
its Lipitor cholesterol-lowering drug.
The New York drug maker said it
would stop using print and television
ads featuring Dr. Jarvik after the House
Committee on Energy and Commerce
launched a probe in January into his
credentials and celebrity drug endorsements. Obviously, Pfizer acted in
response to the mounting criticism and
this congressional investigation. The
committees chairman, Rep. John
Dingell, sent letters to both Pfizer and
the Food and Drug Administration
saying that the ads could mislead
patients because Dr. Jarvik isnt a practicing physician.
The commercials were part of
Pfizers defense of Lipitor in the face of
37
competition from the generic version

of another cholesterol drug, Merck &
Co.s Zocor. Lipitor, the worlds bestselling drug, posted sales $12.9 billion
in 2006 and of $12.7 billion in 2007.
Pfizer spent $119 million on Lipitor ads
in the first nine months of 2007, compared with $91 million in the first nine
months of 2006, according to TNS
Media Intelligence. Dr. Jarvik was the
star attraction in six campaigns for
Pfizer. One ad shows the doctor at a
lake discussing why he takes Lipitor. It
plays up the fact that he is a physician,
saying, Just because Im a doctor
doesnt mean I dont worry about my
cholesterol and Lipitor is one of the
most researched medicines.You dont
have to be a doctor to appreciate that.
While I concede the ad campaign
was effective, I have never understood
why Congress and the FDA allow drug
companies to advertise drugs regardless
of who the pitch person happened to
be. There can be no justification for a
drug company advertising a prescription drug to the public. Congress
should ban all ads by drug companies
and leave decisions on prescription
drugs to trained medical doctors and
pharmacists.
ing animal-abuse scandal.The Humane

Society of the United States distributed
an undercover video on January 30th
that showed workers kicking sick
cows and using forklifts to force the
cows to walk. The video raised questions about the safety of the meat,
because cows that cannot walk, called
downer cows, pose an added risk of
diseases, including mad cow disease.
The federal government has banned
downer cows from the food supply.
Agriculture officials claim there was
little health risk from the recalled meat
because the animals had already passed
pre-slaughter inspection and much of
the meat had already been eaten. In
addition, the officials noted that
although mad cow disease was
extremely rare, the brains and spinal
cords from the animalsthe area most
likely to harbor the diseasewould not
have entered the human food chain. I
hope that assessment is correct. In any
event, this is a major recall and one that
causes great concern for consumers,
including children.
The federal government has estimated that cough and cold medicines
send about 7,000 children to hospital
emergency rooms each year. About
two-thirds of the cases were children
who took the medicines unsupervised.
But about one-quarter involved cases in
which parents gave the proper dosage
and an allergic reaction or some other
problem developed, the study by the
Centers for Disease Control and Prevention reported. Recently, the Food
and Drug Administration warned
parents that over-the-counter cough
and cold medicines were too dangerous for children younger than 2.
LARGEST RECALL OF GROUND BEEF IS

ORDERED
The largest beef recall in history was
issued last month involving 143
million pounds of beef. Some of the
beef was actually used in school lunch
programs, according to the Department of Agriculture. More than a third
of the contaminated meat had already
been used in federal nutrition programs, including school lunches. Of the
143 million pounds of recalled meat,
just over 50 million pounds was
bought for use in the federal programs,
according to the department.About 20
million pounds of that has already
been consumed.The recall by the Westland/Hallmark Meat Company, based in
Chino, California, came after a widen-
38
PARENTS MUST BE CAREFUL WITH COLD

MEDICINES FOR CHILDREN
REPORT FUELS CONCERN OVER CHEMICALS

IN BABY PRODUCTS
A recently released study reveals that
baby shampoos, lotions, and powders

may expose infants to chemicals that
have been linked with possible reproductive problems.The chemicals, called
phthalates, are found in many ordinary
products, including cosmetics, toys,
vinyl flooring, and medical supplies.
They are used to stabilize fragrances
and make plastics flexible. In the study,
they were found in elevated levels in
the urine of babies whod been
recently shampooed, powdered, or
lotioned with baby products. Phthalates are under attack by some environmental advocacy groups, but experts
are uncertain what dangers, if any, they
might pose. The federal government
doesnt limit their use, although California and some countries have restricted
their use.
Concerned parents can seek products labeled phthalate-free, or check
labels for common phthalates, including DEP and DEHP. But the chemicals
often dont appear on product labels.
Thats because retail products arent
required to list individual ingredients of
fragrances, which are a common phthalate source. The new study, which
appears in Februarys issue of the
journal Pediatrics, involved 163 babies.
XVIII.
ENVIRONMENTAL
CONCERNS
APPELLATE PANEL REJECTS EPA EMISSION
LIMITS
A three-judge federal appeals panel in
Washington struck down the Environmental Protection Agency limits on
mercury emissions from coal-fired
power plants.The panel said the agency
had ignored its legal obligation to
require the strictest possible controls
on the toxic metal or to justify an alternative approach. The ruling against a
signature environmental policy of the
Bush Administration is the latest to
reverse agency actions as inconsistent
with environmental laws. The regulation, which the panel unanimously

struck down, was issued in 2005. It
aimed to reduce power-plant emissions
of mercury 70% by 2018, through a
system that capped total emissions, set
the amounts of mercury that power
plants could emit, and let cleaner plants
sell unneeded allowances.A coalition of
environmental groups in alliance with
17 states, mostly on the receiving end of
power plant emissions, sued, arguing
that the law required tighter, more
expensive controls that could eliminate
up to 90% of mercury emissions.
THE BUSH ADMINISTRATION IS PUBLIC

ENEMY NUMBER ONE ON ENVIRONMENTAL
ISSUES
The federal courts have come down
hard against the Bush Administrations
relentless efforts to weaken 40 years
worth of environmental law, including
statutes protecting the nations forests,
wetlands, and endangered species.The
courts have been especially important
in resisting the administrations assault
on the 1970 Clean Air Act, which
began with Vice President Dick
Cheneys 2001 energy report and continues to this day. In 2006 and 2007,
the United States Court of Appeals for
the District of Columbia and the
Supreme Court ordered the Environmental Protection Agency (EFA) to
follow the law and require utilities to
install pollution controls when upgrading power plants. Another Supreme
Court decision last year held that the
Clean Air Act required the EPA to regulate greenhouse gas emissions from
automobiles, an obligation the agency
continues to duck. The D.C. Circuits
ruling relating to mercury emissions
mentioned aboveis another example
of the court challenging the Bush
Administration.
The D.C. Circuit, by no means a
radical group of judges, has become so
exasperated that it has taken to quoting
Lewis Carroll. In 2006, in a reference to
Through the Looking Glass, the court
said that the EPAs reading of the law

would make sense only in a Humpty
Dumpty world. The court, invoking
Alice in Wonderland, said the EPAs
reasoning in the mercury case recalled
the logic of the Queen of Hearts, substituting the agencys desires for the
plain text of the law.The Bush Administration has been public enemy number
one when it comes to protecting the
environment and public health.That is
another part of the Bush legacy and not
a good thing.
CBS CORP. WILL PAY $31 MILLION IN PCB

SETTLEMENT
CBS Corp. has agreed to pay more
than $31 million to settle liability for
the cleanup of six PCB-contaminated
Superfund sites in the Bloomington,
Indiana area. CBS also agreed to additional groundwater and stream cleanup
worth $22.8 million. The Justice
Department, Environmental Protection
Agency, and the State of Indiana
announced the settlement last month,
which was filed in U.S. District Court in
Indianapolis.
CBS is the successor to Westinghouse, which used PCBs, or polychlorinated biphenyls, in the manufacture of
electrical capacitors at a Bloomington
plant until the 1970s. In the 1950s and
1960s, dumps and other locations in
the area were contaminated by an estimated 2 million pounds of PCBs contained in electrical capacitors. PCBs
were widely used as insulating materials in electrical equipment before the
cancer-causing chemical was banned in
the late 1970s because of its toxicity
and persistence in the environment.
The settlement resolves a lawsuit
filed in 1985. Under a previous settlement, CBS was required to dig up and
incinerate contaminated materials at
each site. But the incineration plan was
abandoned in the early 1990s. EPA
Regional Administrator Mary Gade
commented on the settlement:
We are very pleased with this settlement, which provides for robust
measures to protect human health
and the environment. The settlement puts into place measures
that will reduce PCB levels in fish
and bring about a day when fish
in Clear Creek, Stouts Creek, and
Richland Creek can be safely
eaten by people and animals
alike.
The agreement includes a provision
whereby CBS will take over a water
treatment plant and expand it to
capture and remove 99.9% of PCBs
being released into Clear Creek, which
flows through the Bloomington city
limits. CBS also agreed to make payments to EPA to reimburse it for
response costs and to the Department
of the Interior to restore natural
resources damaged by PCBs.Along with
responses under previous settlements,
CBS will have spent an estimated $247
million in addressing PCB contamination at the Bloomington Superfund
sites.
CHILDREN WILL RECEIVE $20.7 MILLION IN

ASARCO SETTLEMENT
Asarco Mining Company has settled
a lawsuit brought by over 200 Oklahoma families.The residents of the Tar
Creek Superfund Site had filed suit
claiming Asarco had contaminated the
area with arsenic, cadmium, lead, and
other heavy metals. Citing blood tests
detecting high levels of the toxic
chemicals, the families sought damages
based on the health problems experienced by their children.The company
filed bankruptcy in 2005 and will pay
the settlement from the companys
continuing copper mine operations.
Several of the families are also involved
in a separate suit against the company
for property damage attributed to the
piles of waste in the area and heavy
strip mining below the surface.
39
HONEYWELL CORP. SETTLES HEXAVALENT

CHROMIUM CONTAMINATION SUITS
The Jersey City Council and the
Hackensack Riverkeepers have agreed
to a settlement with Honeywell, Inc.
that will resolve at least three federal
lawsuits filed by the City and the Riverkeepers. The Citys two suits alleged
that Honeywells corporate predecessor (Mutual Chemical Co.) dumped
tons of cancer-causing hexavalent
chromium on 100 acres of west Jersey
City, New Jersey, property, 41 of which
belonged to the city.The Riverkeepers
suit alleged that the Hackensack River,
which runs through the western part
of Jersey City, was heavily polluted by
chromium seeping into the water.
As part of the settlement, Honeywell
has agreed to pay the City $25 million
over the course of the next two years
and also make a $13 million contribution towards the relocation of the
Jersey City Department of Public Works
and the Jersey City Incinerator. The
agreement also requires Honeywell to
undertake a major clean-up of the contaminated property.The City is hopeful
that the settlement will spur the development of thousands of housing units
plus commercial and retail space on
the citys west side. If successful, the
City expects that the clean-up project
will reap $60 million to $150 million
over the next 20 years in land sales
and, when complete, $50 million in
annual tax revenue.Although the cleanup plan must be approved by the New
Jersey Department of Environmental
Protection and the overall settlement
must be approved by the federal District Court, the City views the settlement as both the answer to its current
budget problems and an opportunity
for new growth.
emitted in trailers still housing tens of

thousands of survivors of Hurricanes
Katrina and Rita. It is being alleged that
FEMA ignored, hid and manipulated
government research on the potential
impact of long-term exposure to
formaldehyde on Katrina and Rita
victims now living in the FEMA trailers.
If FEMA has suppressed the adverse
health effects, that is inexcusable.Any
level of exposure to formaldehyde may
pose a cancer risk, regardless of duration, according to most experts.
More than 40,000 trailers are still
being used by families displaced by
Katrina in August 2005 and Rita weeks
later. FEMA announced last July that it
would test occupied trailers, after congressional investigators disclosed that
the agency had suppressed warnings
for more than a year from its field
workers about health problems experienced by Katrina survivors. Tests on
500 trailers, finally begun in December,
are being performed by CDC. I have to
wonder how much longer Congress
will put up with the antics of FEMA?
Source: Washington Post
XIX.
THE CONSUMER
CORNER
Two Chinese businesses and a U.S.

company have been indicted in the
tainted pet food incidents that killed
potentially thousands of animals last
year and raised worries about products
made in China. Xuzhou Anying Biologic
Technology Development Co.; Suzhou
Textiles, Silk, Light Industrial Products
Arts and Crafts I/E Co.; and Las Vegasbased ChemNutra Inc. were charged in
two separate but related indictments.
The U.S. Attorneys Office in Kansas
City, Missouri, said the U.S. Food and
Drug Administration has received consumer reports suggesting 1,950 cats
and 2,200 dogs died after eating food
contaminated with the toxic chemical
melamine. One of the indictments
charges Xuzhou Anying Biologic,
located in Chinas Jiangsu Province, and
Suzhou Textiles, in Suzhou, China, with
13 felony counts of introduction of
adulterated food into interstate commerce and 13 felony counts of introduction of misbranded food into
interstate commerce. The indictment
also names Mao Linzhun, Xuzhous
owner, and Zhen Hao Chen, Suzhous
president.
It appears that the Federal Emergency Management Agency (FEMA)

manipulated scientific research into the
potential danger posed by a toxic gas
40
FEMA IS AT IT AGAIN
COMPANIES INDICTED IN PET FOOD CASE
IDENTITY THEFT INCREASES IN ALABAMA

Identity theft is still a major problem
across the U.S. Unfortunately, the
number of identity theft cases in
Alabama rose last year. ID theft again
topped the national list of consumer
complaints, according to a Federal
Trade Commission (FTC) report. The
FTC says Alabama had 3,221 identity
theft complaints last year, equal to 69.6
cases per 100,000 residents, ranking
17th among the states. In 2006,Alabama
had 2,774 ID theft complaints, or 60.3
per 100,000 residents, ranking the state
No. 27. Alabama ranked 40th in overall
fraud complaints per capita, up from
44th the year before, according to the
FTC. I hope the Alabama Legislature is
Source: The Hudson Reporter
looking for ways to protect folks in our

state.
TOXIC BABY BOTTLES

Common baby bottles sold across
North America contain very significant levels of a chemical linked to
infertility and cancer, according to a
report released by a coalition of scientists and environmental health advocacy groups.The chemical bisphenol A,
which is a synthetic hormone that can
leech out of certain plastics when
heated, turned up in nine different polycarbonate bottles commonly sold in
Canada by three different manufacturers. Bisphenol A, or BPA, is used to make
hard polycarbonate plastic, and can be
found in many items, including hard
plastic bottles and in a lining of tin or

aluminum cans.The report claims 95%
of all baby bottles contain BPA, a
number which is referenced as according to ScienceNews.org.
Source: CBS News
TOYS R US TIGHTENS SAFETY STANDARDS

Toys R Us will soon have stricter
safety standards for the products it
sells in its more than 1,500 stores.
Starting on March 1st, the Wayne, New
Jersey-based toy retailer is setting a
much tighter standard for the amount
of lead allowed in toys made just for
the chain. Its also barring two chemicals that have raised safety concerns
in products for infants and young children. By the end of the year, there also
wont be nickel-cadmium batteries in
Toys R Us productsa move meant
to help the environment. The
company says the changes should
meet or exceed new federal standards
expected from Congress.
HOME-GROWN PROBLEMS THREATEN U.S.

FOOD SAFETY
The American people are extremely
concerned about the safety of the food
they buy and consumeand with good
reason. In little less than a year-and-ahalf, the nationwide recalls of tainted
products have formed their own peculiar food pyramid: meats, vegetables,
salad, snacks, fast food, even dessert
items.The various pathogens in those
products killed at least three people,
sickened more than 1,300 others, and
touched almost every state in the
country as well as Canada.Although the
number of outbreaks has leveled off
over the past few years, its the variety
of outbreaks that most troubles the scientists and government health officials
who deal with them. Records reflect
that many of the contaminations are
showing up in foods never before associated with poisoning.
Not only are scientists puzzled about
how such staples became tainted, but
they are concerned that U.S. health officials need to do a better job of pinpointing
potential
sources
of
contamination before unsafe food
winds up on supermarket shelves.
There are a number of obstacles to
overcome. The first is an agricultural
industry thats becoming increasingly
monopolized by a handful of highvolume producers, which means no
contamination is small in size or scope.
Making matters worse, we are dealing
with an outdated, imbalanced food-surveillance system that cant really police
the nations entire food supply. Obviously, there is lots to handle when it
comes to food safety.
Source: HealthDay
XX.
RECALLS UPDATE
ENGINE FIRES LINKED TO 4.6 MILLION
RECALLED FORDS
The government is warning the
owners of about 4.6 million recalled
Ford vehicles to immediately bring
their cars and trucks into dealerships
to disconnect faulty cruise control
switch systems that have been linked
to engine fires.The National Highway
Traffic Safety Administration issued the
consumer advisory to the owners of
certain Ford, Lincoln and Mercury
sport utility vehicles, pickup trucks,
vans and passenger cars. About 9.6
million Ford Motor Co. vehicles have
been recalled and about 5 million have
been fixed. NHTSA said they have
received about 60 complaints of engine
fires in the Ford vehicles since August
2007. There are a number of involved
vehicles in this recall. You can get a
complete list by going to the NHTSA
Web site www.nhtsa.gov. If you dont
have access to the Internet, let us know
and we will furnish this information.
GM TO RECALL 180,000 CHEVY HHRS

General Motors is recalling 181,516
Chevrolet HHR wagons. It was discovered that some of the vehicles dont
meet government standards for protecting occupants from head injury in a
crash. Chevy HHRs not equipped with
optional roof rail-mounted airbags and
sold between 2006 and 2008 failed
GMs side-impact tests. Roof railmounted airbags are designed to
reduce the risk of head injury in the
event of a side-impact collision. In a
letter to dealers, the automaker said
dealers would need to install a piece of
energy-absorbing plastic to the headliner trim. The recall will begin later
this month, when the parts become
available. The company will send out
notification letters to customers.
In 2007, about 99,000 Chevy Cobalt
sedans were recalled for a similar
problem. The Cobalt and HHR share
their underlying engineering.The retrostyled Chevy HHR wagon is a competitor to Chryslers PT Cruiser. Owners of
affected Chevy HHR models can
contact Chevrolet at 1-800-630-2438 or
go to chevrolet.com. The National
Highway Traffic Safety Administration
can be contacted at 1-888-327-4236 or
safercar.gov.
FORD RECALLS 225,000 VEHICLES FOR

CRUISE CONTROL
Ford Motor Co. is recalling about
225,000 vehicles that were already
repaired as part of an earlier recall to
address concerns about a cruise
control deactivation switch.According
to Ford, the affected vehicles represent
a small portion of the about 10 million
vehicles that have been recalled since
1999 related to the cruise control
switch problem. Ford dealt with the
cruise control switch problem by
installing new wiring harnesses in the
recalled vehicles. Now, the automaker
says some of those wiring harnesses
appear to be defective. Ford discovered
the wiring harnesses problem while
repairing a vehicle in its own fleet.The
41
automaker says no accidents or injuries

have been caused by the problem.
The cruise control switch recall was
in response to engine fires linked to
the cruise control systems in trucks,
sport-utility vehicles, and vans. The
vehicles in the new recall include
185,000 E-Series vans with model years
ranging from 1992 to 2003. Other
affected vehicles include 1993-95 Ford
Taurus SHO; 1992-98 Ford Crown Victoria and Mercury Grand Marquis; 199295 Lincoln Town Car; 1993 Ford
Bronco; 1993 gas powered Ford Super
Duty; and 1995-97 gas-powered Ford
Super Duty stripped chassis. Ford said
not all vehicles in those model years
had the faulty wiring harness installed.
Affected owners will be contacted by
the company.
FORD RECALLS VEHICLES OVER DOOR

HANDLES AND FUEL HOSES
Ford Motor Co. is recalling more than
180,000 sport utility vehicles and vans
in two separate recalls to fix interior
door handles and faulty fuel hoses.The
larger of the two recalls involves nearly
124,000 Ford Expedition and Lincoln
Navigator SUVs from the 2007-2008
model years. The automaker said the
spring system in the inside door
handles could break. The problem
could prevent the door handles from
returning to a closed position, but
according to Ford, the latches work
properly. But, in a side crash there
could be a risk of the door latch
opening because of the problems. Ford
says there have been no reports of
injuries or accidents. Dealers will
replace the interior handle spring on
all side doors.The recall involves 20072008 Expedition and Navigator vehicles built from March 3, 2006 through
August 9, 2007.
The second recall involves more than
57,000 2006-2007 E-150, E-250 and E350 vans, and 2007 Expedition and
Navigator SUVs with 5.4 liter engines.
The automaker said the engines fuel
rail crossover hose, which connects the
fuel rails, could crack and leak fuel,
42
potentially leading to a fire.There have

been no reports of fires, injuries, or
crashes according to Ford. Dealers will
replace the fuel rail assembly.The recall
was expected to begin in late February
for the handle spring. The fuel hose
recall will begin this month. For more
information, owners may contact Ford
at (800) 392-3673.
VOLVO TO RECALL 1,502 S40 SEDANS IN

CHINA BECAUSE OF FUEL PUMP PROBLEM
Volvo AB is recalling 1,502 imported
S40 sedans in China as part of its global
recall efforts because of a technical
problem with the fuel pumps. The
problem is with the fuel pump electronic modules, which monitor the fuel
pump.The electronic modules run the
risk of causing corrosion, according to
the company.The recall affects vehicles
made between September 15, 2004 and
August 22, 2005.
MOTOR HOMES RECALLED

Tiffin Motorhomes, Inc. has recalled
the 2005-2008 Allegro Bus. Certain
motor homes built on Freightliner
chassis and equipped with zf model
8018 steering gears may have been
assembled with the incorrect recirculating ball spacer.This could allow the
recirculating balls to escape from the
recirculating ball circuit, resulting in a
loss of steering. The operator may
notice higher required steering wheel
inputs. Also, the operator may notice
the need for more steering wheel
adjustments while driving in a straight
line. Metallic cracking noises may occur
before a loss of steering.A loss of steering could result in a vehicle crash.Tiffin
is working with Freightliner to replace
the steering gear free of charge.
Owners may contact Freightliner at 1800-547-0712. Customers may also
contact National Highway Traffic Safety
Administrations vehicle safety hotline
at
1-888-327-4236, or
go
to
http://www.safercar.gov.
The 2008 Four Winds Presidio 360
has also been recalled. On certain

motor homes built on Freightliner
chassis and equipped with Bendix sr-7
spring brake modulating valves, the
internal rubber check valve may leak.
This causes a delay in the application
of the spring brakes to park the vehicle
after the operator pulls the dash valve
button. This could cause a delay or
failure in applying the parking brakes,
which could result in a vehicle rollaway, increasing the risk of a crash.
Four Winds is working with Freightliner and Bendix to repair these vehicles. Bendix will install a check valve
repair kit for the affected sr-7 spring
brake modulating valve free of charge.
Owners may contact Freightliner at 1800-547-0712, Bendix at 1-440-3299000, or Four Winds at 1-937-596-6849.
Customers may also contact the
National Highway Traffic Safety Administrations vehicle safety hotline at
1-888-327-4236 or go to http://www.safer
car.gov.
ENTERTAINMENT CENTERS BY AMERIWOOD

RECALLED
Ameriwood Industries Inc., of Tiffin,
Ohio is recalling about 138,000 entertainment centers. The entertainment
centers can collapse if the back panel
is not secure, posing a risk of death or
serious injury to consumers. The firm
has received a report of a fatality when
the entertainment center collapsed on
a 19-month-old child. The firm has
received three other reports of minor
injuries involving the entertainment
center. The recalled entertainment
centers are black with two lower miterframed doors, two glass doors at the
top, and CD storage racks. They
measure about 54 inches wide, 71
inches high, and 20 inches deep.They
were
sold
under
the
Ridgewood/Charleswood brand name.
Model number 93956 is printed on the
instruction manual.They were sold at
mass merchandisers nationwide,
including K-Mart stores, from June
2000 through May 2005 for about
$200.The entertainment centers were
manufactured in the United States. Consumers should immediately stop using

the recalled entertainment centers and
contact Ameriwood to receive a free
support panel repair kit. For additional
information, contact Ameriwood tollfree at (877) 732-8252 or visit the firms
Web site at www.ameriwood.com.
EVENFLO BABY SEAT RECALL

Evenflo is recalling the Evenflo Discovery car seats.The company says the
seat may separate from its base in a
crash.The model numbers recalled are
390, 391, 534, and 552. Evenflo will
contact registered owners.You can call
800-356-2029 for more details. Consumer Reports Magazine rated this seat
Not Acceptable last year, but it had to
retract the rating after questions about
its testing procedures. I am not sure the
recalls are related to the issues discussed by Consumer Reports.
CAMPBELL HAUSFELD RECALLS AIR

COMPRESSORS
Campbell Hausfeld, of Harrison, Ohio
has recalled about 233,000 Campbell
Hausfeld and Husky Air Compressors.
Protective covers on the compressors
motor are not made from proper flame
retardant material and can ignite,
posing a fire hazard to consumers.
While the firm has received 11 reports
of fires, no injuries have been reported.
Consumers should stop using the air
compressor immediately and contact
Campbell Hausfeld for a free repair kit.
For further information, contact Campbell Hausfeld at (800) 241-0448
between 8 a.m. to 5 p.m. ET Monday
through Friday, or visit the firms Web
site at www.chpower.com.
ICY HOT PATCHES RECALLED AFTER BURNS

REPORTED
More than 200 people have reported
getting first, second, and third degree
burns and other skin irritations from
Icy Hot Heat Therapy products, leading
manufacturer Chattem, Inc. to order a

recall. Icy Hot Heat Therapy is a selfheating disposable patch designed to
soothe muscular and joint pain.The following Icy Hot Heat Therapy products
are being recalled:
Icy Hot Heat Therapy Air Activated
HeatBack
HeatArm, Neck and Leg
we mentioned in another section of

this issue the companys heparin
products have been associated with
as many as four deaths and more than
400 reports of severe allergic reactions. The FDA has acknowledged it
didnt inspect a Chinese plant that
supplies the active ingredient for
Baxters heparin before approving it
because the agency mixed up the
plants name with a different
company.

HeatArm, Neck, and Leg
Some of the recalled products were
samples of the Icy Hot that were issued
with a promotional package of the 3
oz. size of Aspercreme Pain Relieving
Crme.The product label warns against
using Icy Hot for more than eight hours
in any 24-hour period.) Other warnings
advise against using the product while
sleeping, or on thin, damaged skin or
open wounds. Elderly people with
more sensitive skin are at a greater risk
of getting burned from Icy Hot.
After receiving the first wave of
injury reports in September, the
company expanded the warning label
to include specific instructions for
people 55 and older, whose sensitive
skin might be better protected by
applying the patch to their clothing
instead of directly to their skin. Persons
who have purchased one of the
recalled products can exchange it for a
full refund by calling Chattems Consumer Affairs Department at 1-877-7426275.
BAXTER RECALLS MOST HEPARIN PRODUCTS

AFTER ALLERGIC REACTIONS
On February 28th, Baxter International recalled nearly all of its heparin
blood-thinning products just six
weeks after they were linked to
severe allergic reactions in some
patients.The full recall was delayed to
ensure that another manufacturer
would have enough supply to prevent
a shortage. Heparin is vital in many
medical and surgical procedures. As
FENTANYL PATCHES RECALLED

Patches containing the prescription
painkiller fentanyl were recalled for the
second time in a week last month.The
reason for the recalls was a flaw that
could cause patients or caregivers to
overdose on the potent drug inside.
Sold in the United States by Actavis
South Atlantic LLC, the newly recalled
patches have both this name and the
companys former name, Abrika Pharmaceuticals Inc., on their packaging.
The old name is on the pouches that
contain the patches and the new name
is on the outer carton. Just a week
before, PriCara, a division of Johnson &
Johnson, announced a recall of fentanyl
patches manufactured by its affiliate
ALZA Corp.
The second and most recent recall
includes 25-microgram-per-hour, 50microgram-per-hour, 75 microgram-perhour, and 100 microgram-per-hour
patches with expiration dates of May
through August 2009. Some of the
patches may have a defect that can
cause them to leak, putting patients
and caregivers at risk of coming into
direct contact with the powerful
opioid drug inside.This could result
in difficulty breathing and a potentially
fatal overdose.The company said it had
not received any reports of injuries
related to this defect. Damaged patches
should be flushed down the toilet and
not handled. Skin that has been
exposed to the gel should be thoroughly rinsed with water, but not
washed with soap.The recalled patches
43
were manufactured for Actavis Inc. by

Corium International Inc.Activis Inc. is
a division of Actavis Group hf.
XXI.
FIRM ACTIVITIES
EMPLOYEES SPOTLIGHT
BABY CRIB RECALL
Some baby cribs are being recalled.
The recall includes Bassettbaby dropside cribs. Officials say spindles on the
drop-side of the crib could loosen, creating a gap that poses an entrapment
and strangulation hazard. The cribs
model number is 5446-0504. Bassettbaby says it has received three reports
of spindles coming loose, but no
injuries have been reported. The crib
was sold at Babies R Us stores nationwide from November 2007 through
January 2008 for about $400. Consumers should stop using the crib
immediately and contact Bassettbaby
for a free replacement or a full refund.
RINNAI RECALLS WALL FURNACES DUE TO

CARBON MONOXIDE HAZARD
Rinnai America Corp., of Peachtree
City, Ga. Has recalled about 52,000
Direct-Vent Wall Furnaces, Models
RHFE 431 and RHFE 556. A gasket in
the unit can fail, posing a risk of poisonous carbon monoxide gas leaking into
the home. Rinnai has received 11
reports of carbon monoxide leaking
from the furnace. No injuries have
been reported.The recall involves
Rinnai EnergySaver Direct-Vent Wall
Furnaces, Models RHFE 431 and RHFE
556. They are either natural gas or LP
gas (propane) fueled. The recall
includes only those units manufactured
from February 2000 through December 2007. For additional information,
contact Rinnai toll-free at (866) 7468344 anytime, or visit the firms Web
site at www.wallfurnacerecall.com.
44
MARY PAT CROOK

Mary Pat Crook was born in South
Bend, Indiana. After attending high
school at North Carolina School of the
Arts, Mary Pat graduated from Purdue
University with a degree in Environmental Science. While in college, she
spent her summers as an intern for the
Indiana Department of Environmental
Management. Mary Pat then earned her
law degree from Ohio Northern University, where she received recognition
for her studies in Land Use and was on
the Deans List.
Mary Pat joined Beasley Allen as an
associate on January 2, 2008. Before
becoming an associate, she worked as a
staff attorney in the firms Toxic Tort
Section. Mary Pat is currently working
on several environmental cases involving issues such as nuisance and trespass resulting from noxious odor
emissions. She is a member of the Hugh
Maddox Inns of Court. She is married
to C. McDowell Crook, Jr., an associate
with the law firm Haskell, Slaughter,
Young and Gallion, LLC. Mary Pat is a
hard worker and is doing good work
for her clients.We are most fortunate to
have her with us.
MELISSA PRICKETT
Melissa Prickett, a shareholder in our
Mass Torts Section, is currently investigating all of our Celebrex and Bextra
claims. She is also involved in the
Hormone Therapy Litigation and serves
on several committees in the Prempro
MultiDistrict Litigation. Melissa graduated from Jones School of Law in 2001.
While at Jones, she served as a member
of the Law Review Board and was recognized as Outstanding First Year
Student. She was active in the Student
Bar Association and held the positions
of First-Year Senator and Vice-President.
The Montgomery native was also
selected Whos Who Among Students in
American Universities and Colleges.

Melissa is a member of several associations and has served as a guest scoring
judge in local moot court competitions. She serves as a mentor to
members of the Women Students Association at Jones School of Law. Melissa
has been a guest speaker at local seminars and at senior citizen centers on
pharmaceutical litigation. Melissa is
married to Michael Prickett, and they
have seven-year old twin sons, Jake and
Sam. The Pricketts are members of
Frazer United Methodist Church and
are active in the Childrens Ministry.
Melissa is a very good lawyer who
works very hard, and is a valuable
member of the firm.We are most fortunate to have Melissa with us.
REBECCA HUFF
Rebecca Huff has been with the firm
for almost 7 years as a Medical Advisor
in our Mass Torts Division. She works
on a number of different types of cases
in the section, but specifically works
with the cases involving Stevens
Johnson Syndrome, a severe form of an
adverse reaction to a drug. Rebeccas
duties include collecting, organizing,
and reviewing medical records. She
summarizes and analyses the information and assists lawyers and legal assistants in that area and with other
healthcare documents.
Rebecca has been married to Dwight
R. Huff, who has worked as an accountant for the U.S Dept of Treasury for 31
years. She has been a nurse for 31 years
and worked at Baptist East as a nurse
manager of a medical surgical/pediatric
unit before coming to the law firm. She
and Dwight have two sons. Andrew
was married last year to Anne and they
live in Atlanta, Georgia. Anne is the
daughter they never had. Matthew, who
worked at the law firm as a staff assistant for two summers while in college,
is finishing a Masters Degree in Public
Health Administration from the University of North Carolina. He will graduate
in May and already has a job in administration at Pitt County Memorial Hospital in Greenville, North Carolina.
Rebecca graduated magna cum laude

from Troy University in 1976 with a
Bachelor of Science in Nursing. She has
worked in many different nursing experiences including: teaching in a
diploma school of nursing in Gadsden,
Alabama; working as a Public Health
Nurse in Baldwin County, Alabama;
working as an Obstetrical and GYN
nurse for over 10 years; and either
working on or managing the medical
surgical unit at Baptist East.
The Huffs were members of Eastmont Baptist Church for over 20 years
and until recently taught 5th grade
Sunday School there. They recently
moved to Pine Level, which is north
of Prattville. They are searching for a
new church home to serve in.
Rebecca says one of her proudest
moments here at the law firm,
involves her work with Stevens
Johnson Syndrome cases. Our firm
was able to help two clients who lost
their eyesight because of this disorder. Now both are getting help to
improve their living surroundings and
their ability to perform everyday life
activities. She says that was especially
gratifying. Rebecca is a very good
employee who is dedicated to her
work and the clients we represent.We
are truly blessed to have her with us.
XXII.
SPECIAL
RECOGNITIONS
SEATTLE SEAHAWKS RECEIVERS GUIDE TO
SUCCESS
As many of youespecially Auburn
football
fanswill
know, Ben
Obomanu is now a wide receiver with
the Seattle Seahawks. Ben, a native of
Selma, was an outstanding receiver
during his college days at Auburn.At a
time when many athletesboth in
college and the professional ranksare
not setting a very good example for
youngsters, Ben Obomanu is an exception. Ben was a cum laude graduate at
Auburn, where he posted a 3.6 grade

point average in finance. Considering
the demands placed on college athletes, and especially those playing football, Bens academic successes were
even more impressive.
In his time away from football, Ben
spends much of his time speaking to
young people. He is in great demand as
a speaker and has a great message for
his audiences. Not only is Ben a tremendous athlete, he is an even better
person. He is a strong Christian who
has his priorities in order. Its good to
know that there are athletes like Ben
who are willing to help young people
at a critical juncture in their lives.
A STORY THAT MAKES ALL OF US FEEL

GOOD
The following is an article that
appeared last month in the Montgomery
Advertiser relating to Jill Cawley, a
longtime employee of our firm. I
believe this is something that you will
enjoy reading. Jill is a valuable
employee at Beasley Allen and hopefully her story will inspire our readers
to in a number of areas.
CAWLEY NOW EATS HEALTHIER,

EXERCISES MORE
On January 28, 2002, as Jill
Cawley was getting ready for bed,
she felt her heart rate accelerate. It
lasted about 10-15 minutes. She
thought it was just stressthings
had been very busy at work, and
she and her husband, Rob, were
getting ready to go on vacation.
Knowing that her family has a
history of heart problems, she
and her husband went to the
emergency room. I really didnt
expect it to be anything, said
Cawley, 49.I think Rob realized I
was in trouble before I did. Her
heart rate returned to normal,
but her doctors decided to keep
her overnight for observation and
tests. The next morning, she was

told shed had a mild heart
attack. After a catheterization
just to make sure nothing significant had happenedCawley
woke up to hear her husband
talking on the phone to her
mother about bypass surgery.Im
thinking, Bypass? I dont need
bypass! Im 43 years old! But the
tests showed she had seven major
blockages. Doctors had stented
three during the catheterization.
To repair the rest would require
quadruple bypass surgery. The
operation was to take place the
following Monday.But Saturday
morning, being the drama queen
that I am, I had another heart
attack, Cawley said.We had to go
into emergency surgery for the
quadruple bypass.
Before this crisis, Cawley was
taking prescription medication for
high blood pressure, but she never
anticipated she would experience
serious heart problems.There was
no way she saw this coming.That
was one of the things I want to
emphasizea lot of times, women
dont have those typical heart attack symptoms, like the crushing
chest pain and pain radiating
down the left arm, she said.All I
had felt was a rapid heartbeat.
She had some difficulties after the
surgery, such as fluid around her
lungs and shortness of breath that
was remedied by a pacemaker.
Eight weeks after all of this, she
was back at work. One big lifestyle
change shes made is losing
weight. She was fairly overweight
when her heart problems began.
Now shes part of Weight Watchers
and has lost 52 pounds. It just
clicked with me: Youve had two
heart attacks; youre on the fast
track for the third one and if that
happens, the outcome is not going
to be good, Cawley said of changing her eating and exercise habits.
I just had to do it. Now, shes exer-
45
cising, eating healthier foods

just paying attention, she said.
My husband being a professional chef, I put him to work, she
said.I told him, We need to use
your skills to plan healthier
meals. Healthy food can be
wonderful, too. I can eat a little
less of what I want, or a little different from what I want and stay
healthier, or I can eat what I
want and continue digging my
grave with my fork. Her advice to
women: Use your feminine intuition. If something unusual is
going on with your body and
your instinct tells you that somethings not right, get it checked
out, Cawley said.Dont wait. If I
had waited, I might not be here.
We were supposed to be leaving
that Thursday for a cruise, and if
this had happened while we were
at sea, I probably would have
come home in a shipping crate,
she said. I came very close to
being one of those women you
hear about that hits the floor and
never knew what happened.
Jill is a strong Christian who has her
priorities in life in order. She has been a
real inspiration for all of us at Beasley
Allen. I am pleased to send her message
on to our readers for their enjoyment
and edification.
ing order. Make God first in all

that you do, trust Him and be
obedient to His commands; your
family must come next if you are
to be successful over the course of
a career in law; and finally your
work must be important to you
and you must strive to be the very
best that you can be as a lawyer.
Its hard to follow this set of priorities, but it is absolutely a necessity if you are to have a
productive life and one that
brings real satisfaction. In my
business helping folks who need
help and who without a lawyer
would be left out of the system, is
very important. It is also essential
to remember that the clients
interest comes first and must be
honored in the lawyer-client relationship. Finally, you must learn
to say no when that is the right
response regardless of the context
in which a decision-making situation arises. Sometimes, that is also
difficult to do, but again a
requirement in this field of work.
I believe that this advice would be
good for folks who work in other occupations or vocations. I only wish some
older lawyer had taken the time to
advise me when I first started to work
as a young lawyer.
RACE SEASON IS HERE
XXIII.
SOME CLOSING
OBSERVATIONS
SOME ADVICE TO YOUNG LAWYERS
I was asked recently to contribute to
an article for publication in a state bar
journal.They asked me to write something that might be of some benefit to
young lawyers.The following is what I
furnished:
It is essential for a lawyer to set
his or her priorities in the follow-
46
Grant Enfinger, the driver of the

firms race car, recently graduated from
the University of South Alabama. He has
moved to Charlotte, North Carolina,
which is the center of the stock car
racing world. Grant will continue
racing the firms 82 Super Late Model
in the Alabama/Florida region in addition to races in the Carolinas. In the
opinion of real experts, Grant has a
bright future in stock car racing. He has
the potential to be as good as they
come.
The race team has upgraded its Web
sitewww.BeasleyAllenRacing.com
with photos and articles about the
races and the crew. Grant and the firm

promote the Cystic Fibrosis Foundation
to help fight this serious disease, which
impacts the lives of many young
people and their families. Grant has
been told by race fans of their appreciation for highlighting this genetic
disease.The racing Web site has a link
to the Foundations Web site, which
provides information and hope in the
fight against CF.
Grant works on the firms race car at
night and weekends, while working
days in a race shop in Charlotte. He is
learning the ins and outs of ARCA and
NASCAR, and we look forward to him
taking the Beasley Allen race team to a
higher level. Race results and a schedule of races can be found at the race
teams Web site. We are all excited
about the upcoming racing season!
FAVORITE BIBLE VERSES FOR THE MONTH

Leigh ODell and Andy Birchfield supplied some of their favorite Bible verses
this month. Since all of them seemed
appropriate, I am including more than
one verse this month.
Trust in the LORD with all your
heart and lean not on your own
understanding; in all your ways
acknowledge him, and he will
make your paths straight.
Proverbs 3:5-6
Rejoice in the Lord always. I will
say it again: Rejoice! Let your gentleness be evident to all. The Lord
is near. Do not be anxious about
anything, but in everything, by
prayer and petition, with thanksgiving, present your requests to
God.And the peace of God, which
transcends all understanding,
will guard your hearts and your
minds in Christ Jesus. Finally,
brothers, whatever is true, whatever is noble, whatever is right,
whatever is pure, whatever is
lovely, whatever is admirableif
anything is excellent or praiseworthythink about such things.
Whatever you have learned or

received or heard from me, or
seen in meput it into practice.
And the God of peace will be with
you.
Philippians 4:4-9:
For this reason, ever since I heard
about your faith in the Lord Jesus
and your love for all the saints, I
have not stopped giving thanks
for you, remembering you in my
prayers. I keep asking that the
God of our Lord Jesus Christ, the
glorious Father, may give you the
Spirit of wisdom and revelation,
so that you may know him better.
I pray also that the eyes of your
heart may be enlightened in
order that you may know the
hope to which he has called you,
the riches of his glorious inheritance in the saints, and his
incomparably great power for us
who believe.That power is like the
working of his mighty strength,
which he exerted in Christ when
he raised him from the dead and
seated him at his right hand in
the heavenly realms, far above all
rule and authority, power and
dominion, and every title that
can be given, not only in the
present age but also in the one to
come.
Ephesians 1:15-21
But God, who is rich in mercy,
because of His great love with
which He loved us, even when we

were dead in trespasses, made us
alive together with Christ (by
grace you have been saved), and
raised us up together, and made
us sit together in the heavenly
places in Christ Jesus, that in the
ages to come He might show the
exceeding riches of His grace in
His kindness toward us in Christ
Jesus. For by grace you have been
saved through faith, and that not
of yourselves; it is the gift of God,
not of works, lest anyone should
boast. For we are His workmanship, created in Christ Jesus for
good works, which God prepared
beforehand that we should walk
in them.
Ephesians 2:4-10
Therefore, since we are surrounded by such a great cloud of
witnesses, let us throw off everything that hinders and the sin
that so easily entangles, and let
us run with perseverance the
race marked out for us. Let us fix
our eyes on Jesus, the author and
perfecter of our faith, who for the
joy set before him endured the
cross, scorning its shame, and sat
down at the right hand of the
throne of God
Hebrews 12:1-2
Andy says that he has favorite verses
at different times depending on what
he is facing at that time. I suspect that
would apply to all of us. I know that it

does for me. I would like to hear from
our readers on the subject.
XXIV.
SOME PARTING
WORDS
At one of our firms weekly devotions last month, Pastor Carmen Falcione reminded us that if we are
believers in Jesus Christ, our faith is not
in a limited godbut an all-powerful,
all-knowing, and ever present God. It
was a reminder that no matter what
happens in life, God is neither surprised nor shocked. Nothing is out of
His control. Carmens message was
most reassuring. Romans 8:28 tells us,
And we know that God causes all
things to work together for good to
those who love God, to those who are
called according to His purpose. Or, as
I heard a preacher say one time,when
things look like they are falling apart,
God is really making them fall into
place. It is encouraging that even with
all the uncertainties and trials and
tribulations in life, we can be confident
that there is an all-powerful, allknowing, ever present God who loves
us and who promises He will sustain
us, strengthen us, provide for us,
protect us, comfort us, and be with
usalways.
To view this publication on-line,

add or change an address,
or contact us about this publication,
please visit our Website: BeasleyAllen.com
47
No representation is made that the quality of legal services to be performed is
greater than the quality of legal services performed by other lawyers.
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THE

After a lengthy trial a Montgomery

prices reported by the companies.

STATE OF ALABAMA WINS THE FIRST

job and were well received by the

Recent Settlements By Firm . . . . . . 5

The National Scene . . . . . . . . . . . . 13

The Corporate World . . . . . . . . . . 15

VII. Product Liability Update . . . . . . . . 17

Insurance and Finance Update . . . 24

XII. Premises Liability Update . . . . . . . 29

XVI. Nursing Home Update. . . . . . . . . . 36

XXI. Firm Activities . . . . . . . . . . . . . . . . 44

ment presentation during the trial.

THE NEXT ROUND

THE $12 MILLION DOLLAR MAN

during 2004, 2005 and 2006 and that

SENATOR OBAMA IS MY CHOICE

MONTGOMERY MAYOR BOBBY BRIGHT WILL

has announced that he will run for

JOSH SEGALL RUNNING FOR CONGRESS IN

textile plants in the area.The Third Congressional District includes much of

MRS. JOHNNIE CARR DIES AT AGE 97

ago my oldest granddaughter, Sara

SPECIAL INTEREST LOBBYISTS HAVE A

The Alabama Department of Environmental Management (ADEM) has fined

MERCK WILL PAY $671 MILLION TO SETTLE

On a personal note, about three years

ADEM FINES EXXONMOBIL $90,000 FOR

that it overcharged Medicaid programs

vehicles roof strength caused our

by the accident vehicle. Our roof crush

VERDICT IN DEATH CASE IN GREENWOOD,

workers were not unloading these

failure to chock the load of pipes

been too kind to the Senate so far, I am

THE BISHOP-BARRON RESOLUTION

ALABAMA LEGISLATURE WONT WORK ON

ATTORNEY GENERAL PROPOSES TOUGHER

MINIMUM LIMITS BILL PASSES

or too little insurance to cover all the

involves random drug tests 10 to 12

Source: Associated Press

Source: Associated Press

STATE OF ALABAMA APPEALS A PORTION

CHIEF JUSTICE WARNS OF LAYOFFS IN

ExxonMobil has paid a total of

ALABAMA SUPREME COURT FINALLY DOES

company that made the toxins that

promptly pass the legislation required

OREGON HIGH COURT REAFFIRMS $79.5

that was not illegal. The latest Oregon

JUDGE REDUCES DAMAGES AWARDED IN

and punitive damages of $5 million for

USS COLE FAMILIES SEEK REHEARING OF

gible for payment. I hope justice will be

AN APPEALS COURT OVERTURNS TRAVELERS

JUDGE ALLOWS CLASS ACTION HOT FUEL

the longtime industry standard of 60

JUDGE UPHOLDS $196.2 MILLION AWARD

ALABAMA SUPREME COURT ATTEMPTS TO

defect causing the injury. Without

was ejected through the windshield

the venue statute, a county having no