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O N T H E R E C O R D 

Projecting and Enhancing DRI’s Message 

The Voice 2.O 

By Marc E. Williams, DRI Immediate Past President 

At DRI, the moniker “The Voice” is both a tag line 

and a promise. As the largest organization of lawyers 

defending the interests of individuals and businesses in 

civil litigation, we promise to speak out on behalf of our 

members and corporate partners on civil justice issues. 

But this obligation to speak out also means that we have 

to make DRI’s voice as powerful and relevant as possible. 

We don’t want to be the tree falling in the forest 

with no one to hear it. So like my high school speech 

and drama teacher, Mrs. Kontos, taught me too many 

years ago, DRI needs to “project to the last row.” In this 

technologically diverse age, speaking out means more 

than speaking loudly. We need to master the multitude 

of media available to project our message. That means 

using print, video, web, public relations and social 

media to make our case. 

Three years ago under the direction of then-President 

John Martin, DRI commenced a plan to revitalize 

its commitment to be “The Voice” of the defense bar. The 

plan described on these pages and in our other publications 

was intended to bring DRI kicking and screaming 

into the web age. While we have had a website for several 

years, its effectiveness and use was limited. Our ranking 

among websites was low and the site was not optimized to 

reach search engines. We made a decision to expand our 

existing site, www.dri.org, and to start an additional site 

housing expanded content. Under the direction of Deputy 

Executive Director Tyler Howes, our crack staff of inhouse 

IT professionals rebuilt our existing site and added 

a new publicly accessible site to hold the archives of For 

The Defense, our blogs, amicus briefs and our membership 

information. In addition, all of our websites were optimized 

to enhance their reach by search engines. 

In addition to enhancing our web presence, the DRI 

officers also commenced an aggressive campaign to be 

more active in what I like to call “strategic advocacy.” In 

other words, we made the decision that if we were going 

to call ourselves “the voice” it was about time we started 

being the voice by taking stands on civil justice issues 

affecting our members. We asked our public relations 

and communications partner, Levick Strategic Communications, 

to assist us in identifying issues where we 

could speak on behalf of our members and corporate 

partners. We aggressively sought to become the go-to 

source for comments on a myriad of issues of importance 

to DRI members. As a result, we have become the 

reliable source of commentary for journalists writing on 

litigation and civil justice issues. Dozens of DRI members 

have been trained on how to provide cogent and 

understandable comments to journalists covering litigation 

issues. We have also written extensively for papers, 

websites, journals and blogs on litigation-related topics. 

An additional step towards a more significant voice on 

civil justice issues occurred with the reconstitution of our 

Amicus Committee. The best appellate lawyers in the organization, 

most with extensive experience before circuit 

courts of appeals and the United States Supreme Court, 

were asked to review requests for amicus curiae assistance. 

We made a concerted effort to identify cases before 

the United States Supreme Court where we could provide 

the perspective of defense lawyers and their clients. Over 

the last three years we have revolutionized DRI’s involvement 

in cases before our highest court. Whether the case 

involves civil rights, preemption, ERISA or product liability, 

we have become a vibrant voice before the United 

States Supreme Court on these issues. Additionally, we 

have reached out to some of the premier law firms in the 

country to assist in preparing briefs before the Supreme 

Court. Their efforts have enhanced DRI’s position within 

those firms and before the court. 

While our efforts have been successful in transforming 

DRI into a more progressive, forward-thinking organization 

that embraces the emerging technology, we 

also recognize that if we are treading water, we are falling 

behind. The DRI officers, board, committees and 

staff have devoted extensive time and energy to identify 

the ways we can continue to expand our reach into new 

markets. This year we unveiled our newest endeavor, a 

quick-to-market seminar that was planned and executed 

in less than four months. In August we conducted an 

“Oil Spill Litigation” seminar to address issues relating 

to the claims arising from the BP spill. It was a great success 

that drew attention from all of the pertinent players 

on this issue, including the media covering industry’s 

response to the spill. We have also added a Best Practices 

for Law Firm Profitability Seminar to our schedule in 

the fall, conducting it in New York City in conjunction 

with our Insurance Coverage and Practice Symposium, 

thus giving attendees two opportunities to network and 

obtain valuable information for their practices. 

Social networking has also become a focus of our 

efforts at outreach. DRI was one of the first organizations 

to see the value in LinkedIn, and our site has recently 

On The Record, continued on page 10 

For The Defense n September 2010 n 1

DRI—The Voice 

of the Defense Bar 

Vol. 52, No. 9 September 2010 

President 

Cary E. Hiltgen 

Oklahoma City, Oklahoma 

Immediate Past President Marc E. Williams 

Huntington, West Virginia 

President-Elect 

1st Vice President 

2nd Vice President 

Secretary-Treasurer 

Executive Director 

R. Matthew Cairns 

Concord, New Hampshire 

Henry M. Sneath 

Pittsburgh, Pennsylvania 

Mary Massaron Ross 

Detroit, Michigan 

Charles H. Cole 

Chicago, Illinois 

John R. Kouris 

Deputy Executive Director Tyler Howes 

Editor-in-Chief 

Managing Editor 

Editor 

Production Manager 

Contributing Editor 

Advertising 

Representative 

Donald J. Hirsch 

Jay Ludlam 

Michelle Parrini 

Julia Bergerud 

Marge Motluck 

Laurie P. Mokry 

For The Defense, September 2010, Vol. 52, No. 9 (ISSN 

0015-6884). Copyright ©2010, DRI. All rights reserved. 

Published monthly by DRI, 55 West Monroe Street ~ 

Suite 2000, Chicago, Illinois 60603. Telephone: (312) 

795-1101. Fax: (312) 795-0747. 

Periodicals postage paid at Chicago, Illinois, and at 

additional mailing offices. Subscription price is $65.00 

per year, and, for DRI members, is included in the membership 

dues. Individual copies are $7.00 for DRI members 

and $12.00 for non-members, plus postage and 

handling. 

POSTMASTER: Send address changes to For The 

Defense, DRI, 55 West Monroe Street ~ Suite 2000, Chicago, 

Illinois 60603. 

Correspondence and manuscripts should be sent to 

the Editor. 

All views, opinions and conclusions expressed in this 

magazine are those of the authors, and do not necessarily 

reflect the opinion and/or policy of DRI and its 

leadership. 

I N T H I S I S S U E 

1 On The Record 

Projecting and Enhancing DRI’s Message: The Voice 2.O 

By Marc E. Williams, DRI Immediate Past President 

4 DRI News 

Saturday Night Gala Auction to Benefit NFJE! • DRI Calendar • NFJE 

Symposium Explores Public Nuisance • Members on the Move • DRI 

Member Making a Difference Through “New Leash on Life” Program 

12 Election 2010 New Leaders to Be Elected Next Month in San Diego 

C E L E B R AT I N G 5 0 Y E A R S 

18 The DRI Annual Meeting 

A Look at 15 Years of the Defense Bar’s Showcase Event 

By Anne M. Talcott 

C L A S S A C T I O N S 

22 Class Actions in Diversity Actions 

The Complex Interplay Between Rule 23 and State Laws 

By Michael R. McDonald and Damian V. Santomauro 

M E D I C A R E R E I M B U R S E M E N T 

28 When Medicare Is a Secondary Payer 

Mandatory Insurer Reporting 

By Matthew L. Garretson and Sylvius H. von Saucken 

T R I A L TA C T I C S 

36 From the Chair 

Improving Skills, 

Demonstrating Excellence 

By Sidney K. Kanazawa 

38 Trends Limiting Defendants 

Contesting Medical Care in Litigation 

By James H. Milstone and Beth A. Schenberg 

44 Is U.S. Supreme Court Review Inevitable 

New Jersey High Court Extends 

Long-Arm Jurisdiction 

By James J. Ferrelli, Paul M. da Costa 

and Leslie N. Carter 

I N T E R N AT I O N A L L A W 

58 From the Committee 

Growth and Alliances 

Create Opportunities 

By Robert J. Torralbo 

and Christopher G. Campbell 

60 Summary Judgment in International Litigation 

A Local Solution to a Global Issue 

By Asa William Markel 

64 The Continental European Perspective 

Cross Border Tort Claims and the Internet 

By Truiken J. Heydn 

81 Writers’ Corner 

Tedious Bound: Must Briefs Be Boring 

82 Think Globally 

BP’s Disaster a “Tipping Point” The Need for Better Intersections 

Between Claiming Systems for Mass Tort Claims 

92 Advocates and New Members 

49 Are You Ready for Trial 

Turning Chaos into Trial Preparation 

By Lori E. Iwan 

52 Voir Dire Finesse 

Tips to Capture the Best Jury 

By Sharon F. Bridges 

55 Lessons from The Godfather 

Universal Principles and 

Practical Advice 

By Daniel E. Cummins 

68 Don’t Click “Send” Until 

You Read This 

Protection of Privacy in 

International Data Transfers 

By David E. Dukes, Eric A. Paine 

and Heyward D. Bonyata 

74 In the U.S. 

Enforcement of International 

Arbitration Awards 

By Richard N. Sheinis 

and Chad A. Wingate 

By Roger D. Townsend 

By Kirk T. Hartley 

2 n For The Defense n September 2010

Paralegal finds documents, 

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the key sections 

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call 1-800-762-5272 or visit west.thomson.com/casenotebook. 

© 2010 Thomson Reuters L-360258/6-10 

Thomson Reuters and the Kinesis logo are trademarks of Thomson Reuters.

DRI Services 

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D R I N E W S 

By E. Todd Presnell 

4 n For The Defense n September 2010 

Saturday Night Gala Auction 

to Benefit NFJE! 

God help us if we ever take the theater out of 

the auction business… it would be an awfully 

boring world. 

—A. Alfred Taubman, former Chairman of Sotheby’s 

The theater of a good ol’ auction will hit the stage 

during the President’s Gala on Saturday night at the 

2010 DRI Annual Meeting. For the first time, DRI, 

through its Public Service Committee, is putting on 

a week-long silent auction to benefit the mission and 

efforts of the National Foundation for Judicial Excellence 

(NFJE). Throughout the Annual Meeting, you 

will have the opportunity to bid on a plethora of 

enticing items ranging from complimentary Annual 

Meeting registrations to travel packages to tickets for 

must-see sporting events. To whet your appetite, here 

is a list of merely some of the fantastic packages that 

will be available for the taking: 

• 2011 Annual Meeting package—includes two 

complimentary registrations, four-night stay at 

the Marriott Wardman Park hotel, round-trip airfare, 

two Award Luncheon tickets, and two Gala 

tickets. 

• 2011 Seminar package—includes complimentary 

registration to a DRI seminar of your choice, plus 

airfare and a three-night hotel stay. 

• Arizona Biltmore package—two-night stay at 

the wonderful Arizona Biltmore, complete with 

a complimentary breakfast and a Hands Healing 

Massage treatment for two. 

n E. Todd Presnell is a member of 

Miller & Martin PLLC in Nashville, 

Tennessee, and a member of the 

2010 DRI Annual Meeting Steering 

Committee. 

• Pebble Beach Resorts Gift package—includes golf 

bag, club covers, golf hat, shoe bag, ball marker 

set, golf balls, travel mug, and book about the history 

of famous Pebble Beach. 

• Peninsula Chicago Hotel package—one-night stay 

at this luxurious hotel. 

• Sheraton New Orleans package—two-night stay 

with complimentary breakfast. 

• Sheraton New York Hotel & Towers package— 

two-night stay in suite with complimentary 

breakfast for two. 

• Venetian Resorts Las Vegas package—two-night 

stay in the Palazzo Tower suite and two Vegas 

show tickets. 

This is only a sampling—there will be Boston Red 

Sox tickets, Kansas Jayhawks basketball tickets, Tennessee 

Titans tickets, and much more. And with all 

the proceeds going to the NFJE, you can take comfort 

that your purchase (splurge) will benefit a worthy 

cause. The auction will close during the President’s 

Gala, so don’t miss the theatrical episode of your DRI 

colleagues—in full costume of cocktail dresses and 

business suits—pushing, elbowing, and biting to be 

the last one to insert a bid! 

F o l l o w 

o n 

The DRI Community 

Diversity and Inclusion in DRI: A Statement of Principle 

DRI is the largest international membership organization of attorneys defending the interests 

of business and individuals in civil litigation. 

Diversity is a core value at DRI. Indeed, diversity is fundamental to the success of the 

organization, and we seek out and embrace the innumerable benefits and contributions that the perspectives, 

backgrounds, cultures, and life experiences a diverse membership provides. 

Inclusiveness is the chief means to increase the diversity of DRI’s membership and leadership positions. DRI’s 

members and potential leaders are often also members and leaders of other defense organizations. Accordingly, 

DRI encourages all national, state, and local defense organizations to promote diversity and inclusion in their 

membership and leadership.

Calendar 

Upcoming events 

of interest to 

DRI members and 

other defense lawyers 

For more information 

about any of these 

events, call DRI 

Customer Service at 

(312) 795-1101, 

or visit our website at 

www.dri.org. 

September 16 Twitter and Facebook and MySpace, Oh My: 

New Rules for New Technology 

Webcast 

Mediation: How Smart Lawyers and Clients Achieve 

Webcast 

Success in Business and Complex Litigation 

September 21 How Low Can the Regulators Make You Go: The Dilemma Posed Webcast 

by Cleanup Standards that Are Lower Than Background 

September 23–24 Nursing Home/ALF Litigation Chicago 

September 30– Construction Law 

Las Vegas 

October 1 

October 20–24 DRI Annual Meeting San Diego 

November 4 The A-B-C’s of §1983: Back to the Basics of Municipal Liability Webcast 

November 4–5 Fire and Casualty Chicago 

November 11–12 Asbestos Medicine San Diego 

September 20 

DRI Calendar 

November 18–19 Corporate Conduct: Emerging Sources of Criminal and Civil Liability London, England 

Across Europe for Corporations and Their Directors and Officers 

November 18–19 Insurance Coverage and Practice New York City 

November 18–19 Best Practices for Law Firm Profitability New York City 

2011 

January 26–28 Civil Rights and Governmental Tort Liability New Orleans 

March 10–11 Appellate Advocacy Orlando 

March 10–11 Medical Liability and Health Care Law San Francisco 

March 16–18 Damages Las Vegas 

April 6–8 Product Liability Conference New Orleans 

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D R I N E W S 

By Michelle Parrini 

As in the past, the 

sixth annual National 

Foundation for Judicial Excellence (NFJE) 

Symposium explored an 

important trend in legal 

practice: rising use of 

public nuisance in litigation. 

Over the last 15 

or so years, public bodies, 

individuals, and 

plaintiffs’ classes have 

increasingly attempted 

to use public nuisance 

to hold liable a range of 

product manufacturers, 

sellers, and distributors 

for various social 

ills, to hold liable oil, 

energy, and utility companies 

for harm attributed 

to greenhouse gas 

emissions, potentially to spur the legislative 

and executive branches to act in 

the absence of regulation, and perhaps, as 

theorized by a one symposium speaker, 

to resolve “social problems that have 

stalemated the political branches.” Donald 

G. Gifford, The Combination of Public 

Nuisance and Parens Patrie Standing: 

Using Ancient Doctrines to Support Mass 

Products Liability at 8 (NFJE, July 2009), 

http://nfje.net/resources/2010%20Symposium 

%20Course%20Materials.pdf. The symposium, 

“The Law of Nuisance: Bother, Bore, or 

Basis for Broad Causes of Action” was 

held in Chicago in the Swissôtel, July 16–17, 

2010, attended by 100 judges from 31 states. 

Offering a blend of stimulating, 

substantive presentations, a courtmanagement- 

oriented presentation, and 

a skillsdevelopment session on judicial 

opinion writing, the program opened Friday 

evening with a presentation by Executive 

Vice President and General Counsel of 

the National Center for State Courts Robert 

N. Baldwin titled, “Principles- Based Reengineering 

of Court Services.” Drawing from 

the center’s work with courts that wish to 

fundamentally change, or “reengineer,” 

court services, in part, to deal with anticipated, 

long-term budget shortfalls, Mr. 


NFJE Symposium Explores Public Nuisance 

Bryan A. Garner 

Baldwin outlined several principles that 

have guided the center’s work with courts. 

He also explained “Appellate CourTools,” 

seven performance measures tied to values 

common to most appellate courts that can 

help courts discover how 

well they handle cases, 

treat constituents, and 

engage employees. Using 

the measures requires 

undertaking a series of 

steps to establish goals, 

plan, and make decisions 

about strategies to 

bring goals and plans to 

fruition. Still in development, 

three court 

systems are currently 

testing the performance 

measures: the Arizona 

Supreme Court and both 

divisions of the Arizona 

Court of Appeals, the 

Montana Supreme Court, and the Oregon 

Court of Appeals. 

Saturday’s events opened with a skillsdevelopment 

session on advanced judicial 

writing, led by Bryan A. Garner, author 

of more than 20 books on legal writing, 

whose company, LawProse, Inc., is one 

of the country’s largest 

providers of legal writing 

and drafting CLE. 

“The writing that state 

judges do affects people 

more significantly than 

any other group of professionals,” 

Mr. Garner 

began. He appealed to 

the attending judges to 

think of themselves as 

professional writers because 

judicial writing has 

“a profound influence on 

lives and affects the quality 

of justice.” Partly because 

of that he urged the Donald G. Gifford 

symposium participants 

“to assume a wide readership, not just lawyers, 

and especially not just specialists.” “A 

smart high school kid should be able to read 

the opinion, understand it, and say, that’s a 

wise opinion,” Mr. Garner said. 

Before moving on to the nitty- gritty of 

good judicial opinion writing, he offered 

10 quick tips: (1) banish “pursuant to,” 

“prior to,” and “subsequent to” from writing; 

(2) use contractions occasionally; 

(3) call people by names, not “defendant” 

or “obligee,” for example; (4) stop writing 

nonsequiturs; (5) never separate consequential 

sentences by more than 30 characters; 

(6) have two grammar usage books 

in every chamber; (7) require syllogistic 

bench memos—ask clerks to write them 

(a bench memo would state an appellant’s 

contention, the opponent’s contention, the 

clerk’s view, and why he or she holds it); 

(8) promulgate a deep-issue rule for lawyers 

for briefs—a method of framing questions 

that results in a multi- sentence issue 

statement of 75 words that ends in a question 

mark; (9) implement a chamber rule 

of two suggested edits per page per reader 

for opinions, until issuing an opinion, and 

ask everyone to participate in editing and 

exercise the rule, including secretaries; and 

(10) establish a chamber culture in which 

good writing is encouraged. 

On the last point, Mr. Garner observed 

that good writers read for technique and 

read a lot of good material. “You will always 

be two steps behind your reading in your 

writing. To become a 

better writer, you must 

become a better reader,” 

he said. 

Following Mr. Garner, 

Donald G. Gifford, the 

Edward M. Robertson 

Professor of Law, University 

of Maryland School 

of Law, introduced the 

day’s topic with, “Public 

Nuisance: An Overview 

of the Use of an 

800-Year-Old Doctrine 

to Support Mass Liability 

and Parens Patriae.” 

Quoting from a Michigan 

Supreme Court decision 

that characterized public nuisance as 

“the dust bin of the law,” and from William 

Prosser, who shortly after characterized it 

as “a species of catch-all low grade criminal 

offenses,” Mr. Gifford remarked that some

D R I N E W S 

years ago it would have been inconceivable 

that an entire symposium would focus on 

public nuisance. Gifford, The Combination 

of Public Nuisance 

and Parens Patrie Standing 

at 5 (quoting Awad 

v. McColgan, 98 N.W.2d 

571, 573 (Mich. 1959), 

and William L. Prosser, 

Private Action of Public 

Nuisance, 32 Va. L. Rev. 

997, 99 (1966)), URL provided 

above. Yet, today, 

many state attorneys 

general and city attorneys 

use public nuisance 

in lawsuits, in his 

view, “to illegitimately 

take over the regulatory 

process when they Thomas W. Merrill 

believe that Congress, 

legislatures, and regulatory agencies have 

failed.” While acknowledging that torts 

have always had important regulatory and 

deterrent purposes, Mr. Gifford stated his 

belief that public nuisance is different, due 

to its historical origins, development, and 

intent. Describing public nuisance originally 

as a crime that gave the government 

a way to eliminate or ameliorate harmful 

interference with a collective, public landor 

property- based right, he noted that it 

has evolved into a vaguely and variously 

defined tort that appears to encompass an 

array of conditions and facts. In his view, 

public nuisance is problematic because 

(1) it doesn’t provide notice to defendants, 

(2) courts inconsistently apply and differently 

define it, and (3) it asks courts to 

play an inappropriate role in a constitutional 

democracy. In those situations, when 

courts try to fix social problems, he noted 

that courts “frequently fail.” For instance, 

“most public health officials believe that the 

tobacco settlement was a failure,” he said. 

Smoking rates did not decline. 

While he considered public nuisance, as 

defined in the Second Restatement and its 

historical origins, as potentially applicable 

to climate change issues, he thought it was 

inappropriately applied by courts to cases 

involving the manufacture, sale, and distribution 

of products. Because public nuisance 

traditionally focused on eliminating 

or ameliorating a nuisance, a defendant 

must have control of the nuisance or its 

instrumentality. And although he views 

the contours of public nuisance liability 

as changeable, he stated that he believes 

that before courts greatly 

expand it, they should 

admit that they would 

change history, view the 

political processes as no 

longer working, and have 

decided to rely on judgemade 

common law, the 

least legitimate source 

of legal authority, to 

address social problems. 

After lunch, Thomas 

W. Merrill, the Charles 

Evan Hughes Professor 

of Law, Columbia Law 

School, offered three 

propositions about public 

nuisance: (1) he does 

not believe that public nuisance is a tort; it 

is a public action and the closest analogy is 

criminal law; (2) the legislature is the proper 

body to define it and specify who has a right 

to bring public nuisance suits; and (3) before 

public nuisance could proceed to court, the 

legislature must take action. He then elaborated 

on the three propositions. 

Why isn’t public 

nuisance a tort Because 

throughout history it has 

addressed public rights, 

and public rights are 

available to all community 

members. In case 

law, public rights “do not 

simply mean aggregating 

private rights or creating 

mass torts,” he said. 

Additionally, public nuisance 

was prosecuted by 

the crown originally, not 

by private parties, and 

today, public “prosecutors” 

pursue public nuisance 

suits. As also pointed out by Mr. 

Merrill, public nuisance’s purpose historically 

has been abatement, and a wrongdoer 

had a number of days to fix the problem. 

Today, to abate or eliminate a problem, we 

seek injunctive relief, but tort actions seek 

damages. “Public nuisance is the civil law 

analogue to criminal law—an aspect of police 

power implemented by the judiciary,” 

Mr. Merrill said. 

Why is the legislature the appropriate 

institution to establish conduct constituting 

public nuisance Because, according 

to Mr. Merrill, if we accept that public nuisance 

is analogous to criminal law, over 

time, common law crimes have been repudiated 

so that they no longer have a place in 

the federal system. Judicial crime creation 

disappeared entirely over time, driven by 

due process and the advent of separation 

of powers concepts, in Mr. Merrill’s estimation, 

also probably because intuitively 

the courts understood that “the institution 

best suited and reflective of community 

norms” was the legislature. Although 

he did not think that the legislature was 

the only institution to identify public nuisance, 

he explained that “the legislature 

should identify criteria for evaluation,” 

determine who had standing, and identify 

“rights common to the general public.” In 

other words, the legislature should provide 

public nuisance legal “tools” to the courts. 

Next, Burnele Venable Powell, the 

Miles and Ann Loadholt Professor of Law, 

University of South Carolina School of 

Law, spoke. In prefacing the talk, “Ethical 

Dilemmas in Nuisance Litigation Payto-Play 

Lawyering,” Mr. 

Powell described himself 

as part of a generation 

of ethics professors who 

entered teaching after the 

emphasis on memorization 

had passed. Today, 

legal ethics “examine the 

structure within which 

we make lawyers practice 

to understand why 

they will behave as they 

do and structure ethics 

teaching to help lawyers” 

navigate those structures, 

Mr. Powell said. 

Burnele Venable Powell 

That structure was key 

to his talk’s subject. He 

referred to a hot topic in the Wall Street 

Journal in particular, which heartily condemned 

the practice. According to the 

Journal, some lawyers have made contributions 

to political candidates, the politicians 

have hired supporters to pursue lawsuits 

against businesses in those states, and 

the contributor lawyers have transplanted 

those lawsuits to other states. See also Burnele 

Venable Powell, Ethical Dilemmas in 


D R I N E W S 

Nuisance Litigation Pay-to-Play Lawyering: 

Sometimes It’s a Nuisance; Sometimes 

It’s More than a Nuisance—It’s 

Unethical at 147 (NFJE, July 

2010), URL provided above. Mr. 

Powell explained, “The legal 

profession had been called on 

to address this.” Model Rule of 

Professional Conduct 7.6, Political 

Contributions to Obtain 

Legal Engagements or Appointments 

by Judges, eventually 

resulted: “A lawyer or law firm 

shall not accept a government 

legal engagement or an appointment 

by a judge if the lawyer or 

law firm makes a political contribution 

or solicits political contributions 

for the purpose of obtaining or being considered 

for that type of legal engagement or 

appointment.” 

When initially introduced to the ABA 

House of Delegates, the rule failed for several 

reasons, which Mr. Powell explained. 

First, the rules already prohibited “payto-play,” 

specifically, Model Rule 7.2(b), 

Advertising. Second, many people 

believed that the rule dumped Securities 

and Exchange Commission responsibilities 

on the ABA when the ABA did not 

have authority to take action 

or enforce it. Third, some lawyers 

asked, are we really going 

to criminalize lawyers’ political 

contributions Would the rule 

pass constitutional tests Many 

people believed that lawyers as 

businesspersons networked with 

politicians no differently from 

the way Wall Street interacted 

with its constituents. Although 

the ABA did finally adopt the 

James P. Dorr 

rule, Mr. Powell explained that 

recently the “wind has been 

blowing against the Wall Street 

Journal,” as marked by Citizens United v. 

Federal Elections Commission, 558 U.S. 

50 (2010). Although it didn’t directly deal 

with “pay-to-play lawyering,” Mr. Powell 

thought that Citizens United indicated that 

the state did not intend to regulate indirect 

contributions since it differentiated 

between indirect and direct contributions. 

Did this mean, he asked, that we could 

anticipate a time when law firms contribute 

to political campaigns To answer he 

Philip L. Harris 

said that he did not see much of a distinction 

between a pharmaceutical company 

Stephen G. Morrison 

Laura E. Ellsworth 

Tracie J. Renfroe 

and a limited liability company that was a 

law firm. Elaborating further, however, he 

noted that sometimes payment modes for 

lawyers hired by elected officials on behalf 

of states can create problems for the profession. 

After listing the four main ways that 

outside lawyers are paid, hourly fee, contingent 

fee, lump sum, or “value billing,” 

and recognizing the benefits of different 

payment arrangements, Mr. Powell asked, 

“What happens when an outside counsel 

has authority to proceed on the public’s 

behalf” Especially what happens if that 

counsel has been hired under a 

contingent fee arrangement In 

public nuisance cases, he argued, 

“The defendants are part of the 

public,” and public prosecutors 

are charged with making sure 

that justice is done on behalf of 

the public, creating conflicts of 

interest. A lawyer’s self interest 

can undermine representing 

a state and the public’s interest 

evenhandedly without sufficient 

“institutional controls” or supervision. 

Powell, Ethical Dilemmas 

at 153–54 (discussing in People 

ex. Rel. Clancy v. Superior Court, 705 P.2.d 

347 (Cal. 1985)), URL provided above. 

After reviewing the scenario in People 

ex. Rel. Clancy v. Superior Court and mentioning 

other cases, Mr. Powell specified 

that making a campaign contribution to a 

government official in the hopes of securing 

business did not necessarily create a 

conflict of interest for an outside attorney, 

nor did agreeing to a contingent fee 

arrangement. A conflict would, however, 

probably arise if the attorney had great 

independence in exercising state powers to 

act in the public interest to end 

a public nuisance. See also Powell, 

Ethical Dilemmas at 154, 155, 

URL provided above. 

In concluding, Mr. Powell 

asked, “What do these cases tell 

us about public nuisance law” 

First, he answered, we can expect 

lawyers’ ethical conflicts issues 

to arise more often in public nuisance 

suits. Second, when they do 

arise, the relevant questions are, 

do we have a situation in which 

an attorney has been asked to 

represent the public as parens 

patriae but also to sue for the state And 

does that attorney have adequate supervision 

that will ensure that the state hasn’t 

relinquished policy- making to that attorney 

Public officials will need to retain control 

over public nuisance cases when they 

hire outside counsel to work on them, he 

summarized. 

The symposium concluded with a panel 

of distinguished defense attorneys, each 

of whom had defended against public nui- 


D R I N E W S 

sance suits and had provided outstanding 

papers about the law as it applied to 

those cases to symposium participants. 

The panel was moderated by Stephen G. 

Morrison, a partner with Nelson Mullins 

Riley & Scarborough LLP in its Columbia, 

South Carolina, office and a DRI pastpresident. 

See generally Course Materials, 

The Law of Nuisance: Bother, Bore, or Basis 

for Broad Causes of Action (NFJE, July 

2010), http://nfje.net/resources/2010%20Symposium%20Course%20Materials.pdf. 

Panelists 

included James P. Dorr, a partner with 

Wildman Harrold Allen & Dixon LLP in 

Chicago, who has served as lead defense 

counsel in firearms mass-tort public nuisance 

litigation; Laura E. Ellsworth, the 

partner- in- charge of the Pittsburgh office 

of Jones Day and a lead lawyer in the landmark 

public nuisance case in which the 

Rhode Island Supreme Court rejected an 

attorney general’s attempt to apply public 

nuisance law to the manufacture and sale 

of products; Phillip L. Harris, a partner in 

Jenner & Block LLP’s Chicago office and 

co-chair of the firm’s Product Liability and 

Mass Tort Practice Area; and Tracie J. Renfroe, 

a litigation partner in King & Spaulding’s 

Houston office and counsel of record 

for an energy company in the Comer and 

Kivalina climate change nuisance cases. 

Mr. Morrison led participants through 

the elements and stages of a publicnuisance 

case hypothetical, asking the 

panelists to describe how those elements 

and stages played out in the cases that they 

had defended after first working through 

that element or stage of the hypothetical 

with symposium attendees. Mr. Morrison 

moved the hypothetical and actual cases 

defended by the panelists from the claims 

and the players, to trial preparation and the 

defendant’s and plaintiff’s theories, to jury 

instructions and verdict forms. 

After completing the exercise, Mr. Morrison 

asked the panelists for final comments 

about public nuisance law today. Ms. 

Ellsworth observed that it doesn’t provide a 

sound basis for decisionmaking. Currently 

public nuisance “can be all things to all 

people,” and in product and warning cases 

it “cuts away all traditional defenses. … 

We cannot have a legitimate rule in the 

law through which defendants lose because 

they have no defenses,” she said. Mr. Harris 

predicted that science would evolve 

so that experts could more easily apportion 

contribution and liability in climate 

change cases, and that we will experience 

a rise in regulatory standards, as well 

as litigation. As a result, he thought that 

“judges will be reluctant to dismiss [those 

types of cases] for standing and causation.” 

Mr. Dorr expressed optimism that 

consensus would develop that the legislature 

was best suited to grapple with public 

nuisance in air cases, also commenting 

that when products have been involved, 

many courts have already said that “these 

cases are really product liability law cases.” 

And Ms. Renfroe remarked that no policy 

determinations have yet been made 

about who should bear liability for climate 

change, no limits or caps have been 

imposed in the country, and “these cases 

cannot be litigated because no legal standard 

exists against which judges can measure 

conduct.” 

Members on the Move 

Jayne A. Pemberton of the risk management 

practice group at the law firm of 

Sands Anderson PC in Richmond, Virginia, 

was installed as president of the 

Richmond Metropolitan Women’s Bar 

Association on May 5, 2010, firm president 

M. Pierce Rucker announced. Ms. 

Pemberton earned her bachelor and master 

degrees from Baylor University and her 

law degree at the University of Richmond 

School of Law. She is the board president 

for Big Brothers Big Sisters of Central Virginia 

and remains an active mentor with 

the group. She is the treasurer of the Lewis 

Powell American Inn of Court. In addition, 

she is active with the Virginia Association 

of Defense Attorneys, the Richmond Bar 

Association, and the Virginia State Bar’s 

Litigation Section, where she has chaired 

and co-chaired committees and events in 

the past. 

Julie I. Fershtman, of counsel to the 

law firm of Zausmer, Kaufman, August, 

Caldwell & Tayler, P.C., in Farmington 

Hills, Michigan, has recently co-authored a 

section on developments in tort and insurance 

law that has been published in the 

American Bar Association Tort Trial & 

Insurance Practice Law Journal, Winter 

2010. Ms. Fershtman is currently vice president 

of the State Bar of Michigan and a 

trustee of the Michigan State Bar Foundation. 

She also serves as a vice chair of a 

committee of the Tort Trial & Insurance 

Practice Law Section and is a past officer of 

the Oakland County Bar Association. Ms. 

Fershtman has tried cases before juries in 

four states. A frequent author and lecturer, 

she is the author of three books and over 

200 published articles. She has also lectured 

in 27 states. 

Shook Hardy & Bacon partners Robert 

T. Adams (Kansas City), Harvey L. 

Kaplan (Kansas City) and Gary R. Long 

(Kansas City) have been recognized on the 

latest Lawdragon 500 Leading Lawyers in 

America list. Those honored are identified 

through a combination of law firm submissions, 

online ballots and Lawdragon editorial 

staff research. The fifth annual guide 

includes corporate attorneys, litigators, inhouse 

counsel, law professors, judges and 

neutrals, government attorneys, and public 

interest lawyers. 

E. Frederick (Rick) Straub of Whitlow, 

Roberts, Houston & Straub PLLC in 

Paducah, Kentucky, has been certified by 

the Commonwealth of Kentucky Administrative 

Office of the Courts as a general civil 

mediator. Mr. Straub is an active litigator 

and plans to assist with mediation of civil 

matters throughout Western Kentucky. He 

is a member of DRI’s Trial Tactics, Medical 

Liability and Health Care Law, Workers’ 

Compensation, and Law Practice Management 

Committees. 

The Tallahassee, Florida, law firm of 

Sniffen & Spellman, P.A., is pleased to welcome 

Jason C. Taylor to the firm. Mr. Taylor 

focuses his defense practice in labor 

and employment law, construction litigation, 

automobile and transportation liability, 

bad faith and insurance coverage, 

and premises liability. 

Marge Motluck 


D R I N E W S 

DRI Member Making a Difference Through 

“New Leash on Life” Program 

According to Herman Melville, “We cannot 

live for ourselves alone. Our lives are connected 

by a thousand invisible threads, 

and along these sympathetic fibers, 

our actions run as causes and return 

to us as results.” Denny Shupe exemplifies 

these words in the best possible 

sense. Mr. Shupe, a partner with 

Schnader Harrison Segal & Lewis LLP 

in Philadelphia and former chair of 

DRI’s Aerospace Committee (2006– 

2008), has become involved in a lifeaffirming 

program that seeks to assist 

both our two-legged and four-legged 

friends. He has agreed to serve on 

the board of “New Leash on Life,” 

a Pennsylvania nonprofit committed 

to establishing a lasting, “new 

generation,” inmate dog-training 

program. This laudable program 

recognizes that a major cause of 

the explosive growth in the U.S. 

prison population in the last 25 

years is the high rate of recidivism. 

It also recognizes the epidemic 

growth in numbers of abandoned 

dogs. The program will address 

both by (1) training and socializing 

abandoned dogs to enhance 

their adoptability and (2) building 

inmate social and job skills to 

improve successful reentry into 

the community after they have 

served their prison terms. Supported by 

a professional team with impressive credentials 

in medical sociology and clinical 

and educational psychology, this team 

will develop a thorough training curriculum 

and supervise the program, which will 

NEW LEASH 

N LIFEUSA 

To improve the life of inmates and save the lives of dogs 

also include rigorously designed outcome 

evaluation measures. Finally, “New Leash 

on Life” will offer scholarships to qualified 

parolees so that they can continue to pursue 

further animal care training and education 

once they reenter society. 

This isn’t the first time that Mr. Shupe 

has demonstrated commitment to community 

service. In 2007, he received the 

President’s Call to Service Award from 

the President’s Council on Service and 

Civic Participation in recognition of 

his nationwide volunteer work with the 

United Service Organizations (USO). 

The President’s Call to Service Award 

requires that an individual complete a 

minimum of 4,000 hours of community 

service over a lifetime. In addition 

to this prestigious award and several 

other service awards throughout 

his life, Mr. Shupe received 

DRI’s Community Service Award 

in 2003. 

A seasoned trial attorney and 

immediate past chair of Schnader’s 

Litigation Services Department, 

Mr. Shupe previously 

chaired the firm’s Aviation Group 

and its Products Liability Group. 

He recently was elected to a position 

on Schnader’s executive committee. 

His practice concentrates 

on representation of international, 

national, and regional companies 

in a wide variety of commercial, 

product liability, and business litigation 

matters. Mr. Shupe is also 

a retired Air Force command pilot and the 

recipient of several military service awards. 

For more information on “New Leash on 

Life,” please visit www.newleashonlife-usa.org. 


On The Record, from page 1 

grown to over 2,000 members, making it the 

largest LinkedIn site for defense lawyers in 

civil litigation. The site is a valuable tool for 

the exchange of information on programming 

and current legal issues. We have also 

expanded into Facebook, led by our Young 

Lawyers Committee, and most recently into 

Twitter, with @DRICommunity. We also 

have launched two blogs, one that is open 

for members’ contributions, and a DRI President’s 

blog, that is used by the leaders of 

the organization to communicate important 

messages to the membership. 

Most recently, we have introduced a new 

web news portal to house the FTD archives, 

our blogs, link to Facebook, Twitter and 

LinkedIn, as well as provide an access point 

for our membership directory. DRI Today 

(www.dritoday.org) is designed to be the 

ideal home page for the busy litigation lawyer. 

It provides helpful information regarding 

news, as well as a gateway to everything 

you would need related to DRI. 

Rest assured that we will continue 

to look for new and innovative ways to 

enhance DRI’s position in the legal community. 

We want DRI to be recognized not 

only by the universe of lawyers who would 

be our members, but also in the legal community 

as a whole. As our voice grows 

stronger, all of our members will benefit.

is a legal portal designed specifically for 

the defense practitioner and others interested in 

civil litigation. 

Providing direct access to the DRI blog, previously published For The Defense 

articles legal and business news, DRI Today is your one-stop resource for the 

most up-to-date information covering a wide range of topics and issues. 

DRI Blog—DRI 

members share 

thoughts and 

commentary 

with the DRI 

community. Have 

a topic you would 

like to discuss 

Tell us! 

DRI 

Community— 

Keep up 

with what is 

new in the 

community 

by joining DRI 

on Twitter, 

Facebook and 

LinkedIn. 

Defense Docket—DRI’s Defense Docket 

provides legal and business news with 

a convenient filter that allows users 

to customize the page content and 

select articles related to a specific 

legal topic or practice area making 

it easy to find news only relevant 

to your interests. 

www.dritoday.org 

Find a Lawyer— 

Looking for local counsel 

with experience in your 

practice area DRI’s 

Find a Lawyer feature 

allows you to search for 

attorneys by name, firm, 

city and practice area. 

Make DRI Today your homepage!

E L E C T I O N 2 0 1 0 

NEW 

LEADERS 

TO BE 

ELECTED 

NEXT MONTH 

IN SAN DIEGO 

Each year the DRI Annual Meeting serves as the venue for the organization’s 

election of new leaders. The DRI Board of Directors will choose 

four individuals to join them as national directors (each serving threeyear 

terms), one individual will be selected to serve a one-year term as 

secretarytreasurer, and one person will be picked to be the next second 

vice president of DRI, beginning his or her track to eventual presidency 

after serving subsequent years as first vice president and presidentelect. 

Four distinguished, long-time DRI members have declared their candidacy 

for second vice president, one has chosen to run for the nonpresident- 

track office of secretarytreasurer, and four will be vying for 

the open seats on DRI’s Board of Directors. This year’s Annual Meeting 

will be held October 20–24, 2010, in San Diego, California. Immediately 

after the Saturday afternoon board meeting and election, a blast 

email will be sent to DRI’s entire membership with the election results. 

To inform all DRI members about the upcoming elections, For The 

Defense presents a brief profile of each candidate. This information 

was gathered from the candidates’ own responses in the Declaration 

of Candidacy that each completed for DRI. For the first time this 

year, these declarations in their entirety have been made available 

online to DRI members. Please log on to www.dri.org and select 

“2010 Elections” from the drop-down menu under “About DRI” 

near the upper left hand corner of the home page to view the 

complete Declarations of Candidacy and learn more about 

the candidates’ plans and goals for the future of DRI and its 

role in the defense bar and the civil justice system. 

The first four persons profiled, Charles H. Cole, 

Brooks R. Magratten, Laura E. Proctor, and J. Michael 

Weston, are candidates for second vice president. 

They are followed by profiles of Russ Myles, who 

is running for secretarytreasurer, and the 

four candidates for the board of directors. 

We also present a short description of 

the electoral process, focusing on the 

role of the National Nominating 

Committee. 

GUIDELINES FOR 

APPEARING BEFORE 

THE DRI NOMINATING 

COMMITTEE 

The following guidelines have been designed to assist 

DRI members appearing before the Nominating Committee. 

Every member of DRI is encouraged to participate 

in the election of the DRI leadership. The 

opportunity to appear before the Nominating Committee 

is open to all DRI members. Your appearance before 

the Nominating Committee is important, as it provides 

information necessary for the Committee to make its 

recommendations to the DRI Board of Directors. It also 

provides an opportunity for members of the Nominating 

Committee to ask questions about the candidates. 

The Committee encourages each person appearing 

before it to speak openly and candidly about a candidate’s 

qualifications and abilities. All discussion and 

communications within the Nominating Committee are 

strictly confidential and will not be revealed to anyone 

outside the Nominating Committee. Comments should 

focus on the particular traits, attributes and qualifications 

of the candidate that qualify him or her for the 

elective position sought. Negative comments about 

candidates are discouraged unless specifically solicited 

by a member of the Nominating Committee. 

The list below is not all-inclusive; it is designed to 

serve as a guide to help identify points that are considered 

significant by the Committee. While the Committee 

members have general information and knowledge 

about each of the candidates, they are looking for firsthand 

information that may have been gained by either 

working directly with the candidate or through personal 

observation. The following tips represent ideas 

from former members of the Nominating Committee, 

learned through many years of service, and are suggested 

to make the appearance process more efficient 

and compatible to the DRI election process. 

In no particular order, here are a few suggestions: 

1) Before appearing before the Nominating Committee, 

please have your comments organized 

and thought out. Time is limited in order to allow 

everyone the opportunity to appear before the 

committee and it is necessary to adhere strictly 

to the schedule. 

2) It is important to identify at the outset the candidate 

(or candidates) you support, how long 

you have known the candidate, the contact 

that you have had with the person (e.g., experience 

working with him or her in a state or 

local defense organization, a DRI committee, 


THE NATIONAL NOMINATING COMMITTEE 

The DRI Board of Directors 

will elect the second 

vice president, 

secretar y- treasurer, 

and four new members 

of the board at the 

DRI Annual Meeting in 

San Diego. In making 

its selections, the board 

will give serious consideration 

to the recommendations 

of the National Nominating 

Committee. 

The election procedures are laid out 

in detail in Article VII of the DRI By- 

Laws. The five- person National Nominating 

Committee consists of “the three (3) 

most recent Past Presidents [other than 

the current Immediate Past President]… 

and two (2) other members whom the 

President shall select…” 

The National Nominating Committee 

will convene on each of two consecutive 

days at the Annual Meeting for purposes 

of hearing comments and information 

from DRI members regarding 

the candidates for second vice president, 

secretarytreasurer, and board of directors. 

Members are invited to schedule an 

appointment during these meetings to 

express their views on present and future 

issues facing DRI and the defense bar 

and how particular candidates may be 

able to deal with those matters. The nominating 

committee meetings will be held 

on Thursday, October 21, from 8:30 a.m. 

to 12:00 p.m. and 1:30 p.m. to 5:00 p.m., 

David E. Dukes Patrick A. Long John H. Martin David M. Davis Kelly A. Freeman 

on Friday, October 22, from 8:30 a.m. 

to 12:00 p.m. and 1:30 p.m. to 5:00 p.m. 

After receiving the input from those 

appearing before them, and from emails 

and letters of support, the National Nominating 

Committee will deliberate and 

then report to the DRI Board of Directors 

its nominees for each position to be 

filled. The board then votes on each of the 

candidates recommended by the Nominating 

Committee. 

The members of this year’s National 

Nominating Committee are past presidents 

David E. Dukes, who will serve as 

chair, Patrick A. Long and John H. Martin, 

along with David M. Davis and Kelly 

A. Freeman. 

David E. Dukes served as DRI President 

from 2005–2006. He is a partner 

with Nelson Mullins Riley & Scarborough 

LLP in Columbia, South Carolina. 

Patrick A. Long was DRI’s President in 

2006–2007. He is a partner in the Los Angeles 

office of Long, Williamson & Delis. 

John H. Martin served as DRI President 

from 2007–2008. He is a partner of 

Thompson & Knight LLP in the firm’s 

Dallas office. 

David M. Davis is a shareholder and 

director of Davis & Wilkerson PC in 

Austin, Texas. Mr. Davis’ service to the 

defense bar has been extensive. He has 

served DRI as its Southwest Regional 

Director (2006–2009), as chair of the 

Membership Committee (2007–2009), as 

Texas State Representative (2003–2006) 

and as a member of the Annual Meeting 

Steering Committee in 2005, 2006 and 

2007. He is also a past president of the 

Texas Association of Defense Counsel. 

Kelly A . Freeman is in-house counsel 

for Meadowbrook Insurance Group 

in Southfield, Michigan. Ms. Freeman 

is a past officer of DRI, having served 

two terms as secretarytreasurer from 

2005–2007 after a term on the board of 

directors as a nationally elected director 

(2003–2005). She is the first and current 

chair of DRI’s Corporate Counsel Committee 

and a past chair of both the Appellate 

Advocacy and Young Lawyers 

Committees. 

other professional organizations, co- counsel in 

a case, etc.) and your personal knowledge as to 

the candidate’s leadership qualities. 

3) Describe for the committee the personal interests 

of the candidate (if you know) in DRI compared 

to other professional organizations in 

which he or she may be active, and why the candidate 

has a specific interest in DRI. 

4) Identify the specific attributes of the candidate 

that are or should be important to DRI (e.g., geographical 

balance, diversity, corporate law relationship, 

important state or regional profiles, 

etc.) 

5) Describe the candidate’s prior leadership experience, 

of which you have first hand knowledge, 

in any other professional organization, state or 

local defense organization, committee activity, 

community association, position in his or her 

law firm, co- counsel in a case, etc., where the 

candidate has demonstrated prior leadership 

experience. 

6) Comment upon the candidate’s ability to effectively 

and efficiently carry out and perform 

tasks assigned to him or her. 

7) Describe for the committee any observations 

that you might have about the candidate’s leadership 

abilities and the respect that others have 

for him or her. 

8) Describe any other attributes or information 

that you feel are or should be important to the 

committee in determining whether the candidate 

should be recommended to the DRI Board 

of Directors for the elected position sought. 

DRI appreciates your taking the time out of your 

schedule to personally appear before the Nominating 

Committee and share your thoughts and opinions. 

Without your interest and contribution, DRI 

would not be able to elect the best possible leaders. 


E L E C T I O N 2 0 1 0 

SECOND VICE PRESIDENT 

Charles H. Cole 

Schuyler Roche 

& Crisham PC 


Charles H. Cole is 

a shareholder and 

director with Schuyler 

Roche & Crisham 

PC in Chicago with 33 

years of experience as a defense attorney. 

His specialties include medical malpractice 

and health care law, professional and 

product liability, construction law, commercial 

litigation and insurance coverage; 

he has successfully tried over 60 jury trials. 

Mr. Cole joined DRI in 1983 and is 

currently the organization’s secretarytreasurer. 

Elected a DRI regional director 

(North Central) in 2006, he served as 

chair of DRI’s Public Policy Committee 

(2008–2009), board liaison to the Commercial 

Litigation (2007–2009) and Fidelity 

and Surety Committees (2006–2007), 

and as a member of the Strategic Planning 

Committee (2006–2007). Additionally, he 

is a former DRI Illinois State Representative 

(2001–2004) and Illinois Association 

of Defense Trial Counsel president 

(2001–2002), having held many other leadership 

positions within that organization. 

Mr. Cole has received the DRI Leadership 

Award (2004) and the DRI Exceptional Performance 

Award (2002). He is also a member 

of the IADC, the ABA, and the Illinois 

State and Chicago Bar Associations. 

It has long been Mr. Cole’s passion to 

enhance the brand of DRI and eliminate 

the need to answer the question often asked 

by outsiders, “Who or what is DRI” The 

DRI brand should evoke an immediate 

recognition of the pillars of DRI: Education, 

Justice, Balance, Economics and Professionalism 

and Service must drive its 

strategic plan. According to Mr. Cole, the 

brand should create the image of a strong 

national organization that serves the needs 

of its members and the legal community at 

large. He believes that continued focus on 

the “Identity Goal” will lead to expansion 

of the brand and will allow DRI “to be recognized 

as the organization of attorneys 

defending the interests of business and 

individuals in civil litigation.” Mr. Cole 

feels that this goal—a part of the current 

Strategic Plan—remains paramount to the 

success and relevance of DRI and trumps, 

yet complements, all other goals. “Identity” 

is an area that deserves continual attention: 

it will allow DRI to remain significant to its 

members, remain important to the business 

and professional community, drive 

membership and diversity, and bring consequence 

to DRI’s educational seminars. 

Mr. Cole believes that the concern surrounding 

the disappearance of the civil 

jury trial remains the single most important 

issue facing the defense bar in 2011 

and beyond. He contends that DRI must 

cultivate the organizational presence, diligence 

and focus necessary to stay at the 

forefront of efforts dedicated to the survival 

of our jury trial system. 

Brooks R. Magratten 

Pierce Atwood 

LLP 

Providence, 

Rhode Island 

Brooks R. Magratten 

is a partner in the 

Providence, Rhode 

Island, office of Pierce 

Atwood. A member of DRI since 1995, Mr. 

Magratten has been a practicing defense 

lawyer for 23 years. His primary areas of 

practice include ERISA, life, health and 

disability insurance, product liability and 

commercial litigation. 

Mr. Magratten has served on the DRI 

Board of Directors since 2008, representing 

the Northeast Region. He was a member 

of the Strategic Planning Committee 

(2005–2007), and worked with members of 

the Counsel Meeting Task Force to develop 

new counsel meeting guidelines. For the 

past two years he has served as chair of 

DRI’s Life, Health and Disability Committee, 

promoting committee growth and 

increasing attendance at the group’s annual 

seminar. For the past three years he has 

held monthly conference calls with state 

representatives and executive directors 

in the Northeast Region to promote DRI 

membership and organize regional events. 

Mr. Magratten served as the DRI’s Rhode 

Island state representative (2005–2007) 

and is currently President of the Defense 

Counsel of Rhode Island. He is also an 

active member of the Federation of Defense 

and Corporate Counsel, the International 

Association of Defense Counsel and the 

Association of Defense Trial Attorneys. 

If elected, Mr. Magratten has several 

goals that he would strive to reach. To start, 

he wants to develop new revenue sources, 

further collaboration with industry associations, 

expand diversity initiatives, and promote 

DRI brand recognition. He would also 

work to enhance recognition of DRI’s substantive 

law committees as thought leaders 

in their respective fields, foster growth 

of SLDOs and awareness of DRI within SL- 

DOs, and position DRI as a career development 

and firm management resource for 

members. Recognizing that competition in 

the CLE market may limit the potential for 

significant revenue growth from seminars, 

Mr. Magratten favors forming a task force to 

explore potential revenue growth from publications, 

dues, webcasts and other sources. 

He would like to dedicate a full-time DRI 

staff person to work with substantive law 

committees on pursuing collaborative arrangements 

with relevant industry groups, 

expand the advertising campaign launched 

by the Public Policy Committee and seek 

opportunities for DRI substantive law committees 

to comment in public forums. 

Mr. Magratten identifies the accelerating 

changes in the way corporate clients 

and law firms interact as the most significant 

issue facing the defense bar. He 

sees long- standing, attorney- client relationships 

and billing arrangements being 

brushed aside, and recognizes that clients 

are demanding cost savings, creativity and 

flexibility from defense firms. DRI must be 

positioned to help individual members and 

their firms change how they have traditionally 

been structured and operated. 


E L E C T I O N 2 0 1 0 

Laura E. Proctor 

Louisiana Pacific 

Corporation 

Nashville, 

Tennessee 

Laura E. Proctor 

serves as associate 

general counsel for 

Louisiana Pacific Corporation 

in Nashville, Tennessee, where 

she has responsibility for all aspects of 

the company’s litigation. She has been a 

defense attorney for 18 years, the first 13 of 

which were in private practice. 

Ms. Proctor has been a member of 

DRI since 1996 and currently serves as a 

member of the board of directors (elected 

nationally in 2007), and as chair of both 

the Public Service Committee and the 

50th Anniversary Task Force. Her previous 

service includes chairing the formation 

committee for the Corporate Counsel 

Committee (2008), the 2009 DRI Annual 

Meeting Program Committee, the Building 

Products Specialized Litigation Group 

(2006–2007), the Alternative Dispute Resolution 

Committee (2005–2007), and the 

Young Lawyers Committee (2003–2004). 

Ms. Proctor understands that it is DRI’s 

exacting standards that attract attorneys 

from around the country who seek to excel 

in the profession. Her goals are to build on 

this foundation, further promoting DRI’s 

high standards through professional development, 

leadership training, and outreach. 

According to Ms. Proctor, DRI must create 

a culture and a brand that makes the 

statement, “I am a DRI lawyer.” Her goal is 

to help all DRI members understand what 

being a DRI lawyer can and will do for their 

careers if they fully embrace what it has to 

offer. She believes that DRI should provide 

the right opportunities for its members 

so that DRI is the organization to which 

defense lawyers turn when developing their 

professional relationships, their practices, 

and their careers 

Ms. Proctor also believes that leadership 

is an essential ingredient to an extraordinary 

career in law. Yet leadership training 

is seldom offered and often overlooked by 

law firms when training their associates 

and partners. Ms. Proctor proposes a leadership 

development program designed to 

identify, develop, and train DRI’s current 

and future leaders. It will also help DRI 

members become better managers, team 

leaders and partners within their firms. 

Finally, Ms. Proctor believes DRI needs 

to increase its visibility to the public at 

large and be more proactive in getting the 

right message out to those who vote for our 

judges and legislators, as well as to those 

who will serve as jurors. Ms. Proctor feels 

the establishment of a 509(a)(3) charitable 

foundation would allow DRI to raise money 

through contributions, grants and fundraising 

events like the Annual Meeting Silent 

Auction. These funds could then be used to 

help support law related public service and 

educational programs, such as the NFJE, 

that fit within the mission and goal of DRI. 

J. Michael Weston 

Lederer Weston 

Craig PLC 

Cedar Rapids, 

Iowa 

J. Michael Weston is a 

founding member of 

Lederer Weston Craig 

PLC in Cedar Rapids, 

Iowa, where he practices in the areas of 

product liability, commercial litigation, 

tort defense, insurance coverage, and bad 

faith/extra- contractual damage litigation. 

He has been a defense lawyer for 30 years 

and a member of DRI since 1985. 

Mr. Weston has served as a national 

director on the DRI Board since 2008. 

He has previously served DRI as Iowa 

state representative (2004–2007), a member 

of the Strategic Planning Committee 

(2005–2007), chair of the 2008 DRI Annual 

Meeting, and chair of the Public Policy 

Committee (2009–2010). He is also active 

in the International Association of Defense 

Counsel and a past president of the Iowa 

Defense Counsel Association. 

Mr. Weston believes that DRI is uniquely 

positioned not only as the Voice, but also 

the convener and the community of the defense 

bar. Mr. Weston believes that DRI’s 

most important goal is to advance its members’ 

careers so they become excellent lawyers 

with access to a diverse client base. 

Mr. Weston thinks that DRI should promote 

the civil defense practice as a career 

choice from law school to retirement, and 

provide service opportunities to all DRI 

members so that they gain the knowledge, 

exposure, and experience to establish the 

necessary credentials to advance their careers. 

DRI must also advocate in the interest 

of its members and clients by commenting 

on evolving statutory, regulatory, and common 

law; continuing its Amicus Committee 

efforts; collaborating with trade and business 

groups; and continuing to partner with 

groups such as Lawyers for Civil Justice. 

Mr. Weston feels that DRI must work 

to preserve the civil justice system as our 

society’s institution to resolve civil disputes, 

and that DRI members should play 

a leading role in all aspects of the system’s 

evolution. He believes that pursuing these 

goals advances DRI members’ interests, as 

well as those of our clients and the public 

at large. Mr. Weston contends that DRI 

should advance fair and impartial judging 

at the federal and state level by growing 

the influence of the NFJE. DRI should not 

waver in promoting the maintenance of the 

civil jury trial system, and, in partnership 

with SLDOs, strive to ensure that states 

populate the bench with fair and impartial 

judges of the highest moral and ethical 

standing. Criticism of the court system, 

lawyers and the law is not often tempered 

by promotion of the positive aspects of 

our civil justice system. 

DRI must continue to 

advance the 

image and 

efficacy of 

our civil 

j u s t i c e 

system. 


E L E C T I O N 2 0 1 0 

SECRETARY-TREASURER 

Russ Myles 

McDowell Knight 

Roedder & 

Sledge LLC 

Mobile, Alabama 

Russ Myles is a partner 

of McDowell 

Knight Roedder & 

Sledge LLC in Mobile, 

Alabama, and has been engaged in complex 

commercial and business litigation 

for more than 20 years. Mr. Myles has 

defended and prosecuted partner and 

shareholder disputes, claims against officers 

and directors, professional liability 

claims, intellectual property disputes, franchise 

termination suits, and claims arising 

from mergers and acquisitions. His litigation 

experience also includes defending 

product liability, insurance coverage, and 

other claims involving economic damages. 

He has been a member of DRI since 1992. 

Mr. Myles’ service to DRI ranges from author 

and speaker to his current position as a 

member of DRI’s Board of Directors (elected 

nationally in 2007). He is the current chair 

of DRI’s Membership Committee, and a past 

chair of the Commercial Litigation Committee. 

In addition to DRI, Mr. Myles is a member 

of Lawyers for Civil Justice, the IADC, 

the Alabama Defense Lawyers Association, 

and the Fundraising Committee of the National 

Foundation for Judicial Excellence. 

Membership is a topic on which Mr. 

Myles plans to focus as a DRI officer. As he 

has reported to the board, a large percentage 

of DRI membership “drops” are lawyers 

who have been in the organization 

three years or less. To address this issue, 

Mr. Myles believes that DRI must deliver 

the “value” message to members early in 

their association with the organization. A 

membership of three years or less rarely 

offers an individual the opportunity to 

appreciate a “return” on his or her “DRI 

investment.” In addition, he feels that it is 

essential that DRI offer meaningful participation 

opportunities to all members who 

truly want to be involved. 

Raising the profile of DRI as “the Voice 

of the Defense Bar” and the place to “build 

your career” are key goals of Mr. Myles. 

Although much has been accomplished 

recently, for example in the Public Policy 

Committee and DRI’s “branding” efforts, 

in his opinion, DRI can and should do 

more. Mr. Myles believes that raising DRI’s 

profile in the legal arena will bring even 

greater prestige to the organization and 

further enhance the value of membership. 

Membership has its privileges. 

DRI Membership Gives You Access to 

Superior Benefits, Quality Service. 

As a member of DRI, you have an all-access pass 

to the Marsh benefit program that’s been designed 

especially for you. With this program, you can take 

advantage of superior benefits and quality service 

you’re unlikely to find anywhere else. 

Superior Benefits 

Your DRI membership gives you access 

to highly rated insurers and special group 

pricing. Your options include: 

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Superior benefits, Quality service—Membership has its privileges. 

Access your benefits today! Call 1-800-503-9230 or visit www.personal-plans.com/dri 

for more information including costs, exclusions, limitations and terms of coverage. 


E L E C T I O N 2 0 1 0 

NATIONAL DIRECTOR 

Lee Craig 

Butler Pappas 

Weihmuller 

Katz Craig LLP 

Tampa, Florida 

Lee Craig is a partner 

with Butler Pappas 

Weihmuller Katz 

Craig LLP in Tampa, 

Florida. Mr. Craig has concentrated his 

practice on the analysis and defense, in 

trial and appellate courts, of first-party 

insurance matters. He has deep expertise 

in cases of alleged fraud, as well as “bad 

faith” and other consequential damages litigation. 

A member of DRI since 1989, Mr. 

Craig has been particularly active in the 

Insurance Law Committee, which he has 

chaired since 2008. 

If appointed to the DRI Board of Directors, 

Mr. Craig would be an ambassador 

and advocate for DRI membership and for 

recognition—in the legal and insurance 

communities—of DRI’s preeminence. He 

would look forward to speaking at regional 

meetings about the activities of DRI, and 

to promoting enthusiasm for the work of 

the organization. Mr. Craig would welcome 

the opportunity to serve as a liaison 

to one or more substantive law committees. 

He frankly professes no desire to be a 

“policeman.” Rather, Mr. Craig would look 

for ways to exercise his creativity, judgment 

and zeal to assist and motivate committee 

leadership. 

Steven M. Puiszis 

Hinshaw & 

Culbertson LLP 


Steven M. Puiszis is 

a partner of and deputy 

general counsel to 

the firm of Hinshaw 

& Culbertson LLP in 

Chicago. He has been a defense lawyer for 

30 years and a DRI member for the last 23. 

Mr. Puiszis has been a frequent author and 

speaker for DRI and serves the organization 

as state representative for Illinois, and 

as a member of the Judicial Task Force and 

the SLDO Relationship Committee. He is 

also a past president of the Illinois Association 

of Defense Counsel and a member of 

the Association of Defense Trial Attorneys. 

Mr. Puiszis believes that DRI must 

address the continuing, critical impact of 

the economy’s downturn on member firms. 

He notes that DRI member firms have 

frequently maintained their profit levels 

by reducing memberships in professional 

organizations, which has impacted DRI’s 

membership numbers. While the trend 

has slowed, he has identified this as a continuing 

concern. According to Mr. Puiszis, 

advancing DRI’s Strategic Plan—its “identity” 

goal, in particular—will be crucial to 

establishing DRI as the organization that 

defends the interests of individuals and the 

business community, which, in turn, will 

make it easier to meet membership goals. 

Carlos Rincon 

Rincon Law 

Group PC 

El Paso, Texas 

Carlos Rincon of 

Rincon Law Group 

PC in El Paso, Texas, 

focuses his practice 

on the representation 

of motor carriers, railroads, and automobile 

manufacturers. He has been a defense 

lawyer for 21 years and a DRI member 

since 1996. Mr. Rincon is the chair of DRI’s 

Trucking Law Committee and previously 

served on the DRI Strategic Planning Committee. 

He is also an active member of 

the Federation of Defense and Corporate 

Counsel, the Texas Association of Defense 

Counsel, the Trucking Industry Defense 

Association, and the National Association 

of Minority & Women Owned Law Firms, 

for which he has served as a board member 

since 2004. 

If elected to the DRI Board of Directors, 

one of Mr. Rincon’s goals would be to 

increase DRI membership among lawyers 

of color. He would also work on programs 

that assist small law firms to develop strategic 

plans targeting practice diversification, 

client retention, and law practice management. 

Mr. Rincon believes that balancing 

the ever- increasing economic challenges 

with quality client representation, without 

sacrificing the dedication, innovation, 

and effectiveness that all clients deserve, is 

currently the most important issue facing 

the defense bar. 

Mark E. Schmidtke 

Ogletree Deakins 

Nash Smoak & 

Stewart PC 

Valparaiso, 

Indiana 

Mark E. Schmidtke is 

a shareholder of Ogletree 

Deakins Nash 

Smoak & Stewart PC in Valparaiso, Indiana, 

where he practices in the areas of pension, 

life, health, disability, severance, and 

other employee benefit litigation, as well 

as insurance bad faith litigation. He has 

been a DRI member for the last 21 of his 

29 years as a defense lawyer and is a past 

chair of DRI’s Life, Health and Disability 

Committee. 

He has been active in the planning and 

presentation of DRI educational offerings, 

including committee projects and DRI 

Annual Meetings. He would be pleased 

to remain involved in this area as a board 

member and help maintain the organization’s 

recognized excellence, but would be 

equally enthusiastic about filling administrative 

needs. 

If elected, Mr. Schmidtke generally 

believes that making himself available 

wherever his skills are most useful is the 

best approach, instead of proposing an 

agenda in advance. One critical issue that 

Mr. Schmidtke has detected, at least in 

his practice area, is that defense lawyers 

have fallen behind their counterparts on 

the plaintiffs’ side in terms of open and 

ongoing communication. 

He believes that 

DRI should 

endeavor 

to quickly 

close this 

gap. 



The DRI Annual Meeting 

A Look at 15 

Years of the 

Defense Bar’s 

Showcase Event 

By Anne M. Talcott 

The 2010 Annual Meeting is just a month away, October 

20–24, at the Marriott Hotel and Marina in San 

Diego, California. As we finalize our travel plans to 

attend DRI’s marquee event this year, it is interesting 

to note that the Annual Meeting is relatively new in 

the history of DRI. In fact, for the first 35 years of its 

existence DRI did not have a general meeting open to 

all of its members. 

The first DRI Annual Meeting was held in Chicago 

in October 1996, one year after DRI ratified its 

independence from IADC in 1995, and two years before 

full implementation of DRI’s new organizational 

structure in 1998. The inaugural Annual Meeting was 

organized to replace the National Leadership Conference. 

It was also a celebration of DRI as an independent 

entity and a recognition of its identity as the single 

national organization for all civil defense lawyers regardless 

of geographic location or tenure in practice. 

Like membership in DRI itself, the first Annual Meeting 

was designed to be open to everyone interested in 

sharing information from the defense perspective. The 

event was also intended to 

be a gathering place for 

DRI and SLDO leaders— 

to facilitate networking 

and the exchange of best 

practices among all groups within the defense bar. 

DRI’s president at the time, Patrick E. Maloney, of 

Tressler LLP in Chicago, was very active in planning 

the first Annual Meeting. Because DRI had never 

planned an event of such magnitude, President Maloney, 

DRI’s staff, and other volunteers faced numerous 

challenges, but the organization’s experience with 

large seminars proved invaluable. It also helped that 

the meeting was held in Chicago, the hometown of 

both Maloney and DRI. 

The theme of the 1996 Annual Meeting was “First 

for the Future.” The meeting offered a full slate of 

n Anne M. Talcott is a shareholder at Schwabe, Williamson & Wyatt in Portland, Oregon, focusing her practice on complex business 

and product liability litigation. She is a member of the Oregon and Washington Bars. Ms. Talcott is a leader in a number of 

local, state, and national professional organizations including DRI, where she is currently serving as vice chair of the 2010 DRI 

Annual Meeting Steering Committee. She also serves on the steering committees of DRI’s Product Liability and Drug and Medical 

Device Committees. Ms. Talcott is a past chair of the Oregon State Bar Product Liability Section. 


YEARS 

50 CELEBRATING 

LEADERSHIP ■ EXCELLENCE ■ EDUCATION 

continuing education courses, networking 

events, DRI committee meetings, and the 

selection of future DRI leaders. High profile 

personalities, including Senator (and 

former federal judge) George Mitchell, consumer 

advocate Ralph Nader, National 

Public Radio’s Nina Totenberg, Time magazine’s 

Hugh Sidey, and O.J. Simpson prosecutor 

Christopher Darden, were on the 

program, which featured a blockbuster 

program on “Cameras in the Courtroom.” 

Presentations on trial practice and substantive 

legal topics by the best of DRI’s own 

members were also featured. Additionally, 

a large portion of the programming at 

the first Annual Meeting was aimed at volunteers 

and staff of the various state and 

local defense organizations—thus establishing 

the DRI Annual Meeting as the 

event where SLDO leaders could meet and 

exchange ideas, trial war stories, and best 

practices. The meeting was a resounding 

success, establishing it as a “must attend 

event” for DRI leaders and those aspiring 

to leadership. 

DRI has held successful Annual Meetings 

every fall since that inaugural 1996 endeavor. 

The second Annual Meeting (1997) 

was in Baltimore, and the fourth (1999) was 

held in New York City. The Annual Meeting 

has otherwise roughly rotated between San 

Francisco, New Orleans, Washington D.C., 

and Chicago—until this year when it debuts 

in San Diego. Meetings have included 

attendees from every state and several foreign 

countries. Attendance at the Annual 

Meeting has been over 1,150 people for the 

last six years, with an all-time high of 1,262 

in 2009. Thus, even in the midst of the current 

economic recession, DRI’s members 

have recognized the value that the Annual 

Meeting provided to their practice. 

Subsequent meetings expanded the 

original event in various ways. For example, 

The Exhibitor Expo showcases the latest 

technology and services of interest to 

DRI members. The addition of the Diversity 

Reception and Women’s Networking 

events reflect DRI’s commitment to support 

the interests and needs of its entire 

membership. The more recent inclusion of 

on-site counsel meetings provides a venue 

for in-house lawyers to meet face-to-face 

with their outside counsel. Yet the structure 

of the inaugural Annual Meeting was 

so popular and successful that its model 

is still generally followed today. Blockbuster 

national speakers were a hit from 

the beginning and almost always fill the 

rooms to capacity. Notable speakers at 

past Annual Meetings have emanated from 

various walks-of-life, including national 

politicians, journalists, authors, entertainers, 

and public personalities. DRI blockbuster 

speakers would fill anyone’s “Who’s 

Who” list, such as Attorney General John 

Ashcroft, Dave Barry, Julian Bond, Erin 

Brokovich, Pat Buchanan, James Carville, 

Eleanor Clift, Senator Bob Dole, Newt Gingrich, 

Doris Kearns Goodwin, Brit Hume, 

Mara Liasson, Mary Matalin, Jim Morris, 

Carl Rowan, Kenneth Starr, William Suter, 

Senator Fred Thompson, George Will, Juan 

Williams, and Bob Woodward. 

Many attendees identify the outstanding 

networking and social events DRI hosts at 

the Annual Meeting as a reason they register 

year after year. At those events we have 

boogied on House of Blues stages in Chicago 

and New Orleans, run the bases at AT&T 

Park in San Francisco, strolled among the 

dinosaurs at the National Museum of Natural 

History in Washington, D.C., and witnessed 

the amazing grace of beluga whales 



swimming around us at Shedd Aquarium 

in Chicago. Many new acquaintances made 

at DRI Annual Meeting networking events 

have become referral sources, colleagues, 

clients, and friends over the years. 

Public service events have also become a 

tradition at the Annual Meeting, allowing 

volunteers to work a few hours at a charity 

in the host city while spending time with 

fellow Annual Meeting attendees. These 

projects were led initially by the DRI Young 

Lawyers Committee. The first project occurred 

in 2005, when volunteers sorted 

food at the Greater Chicago Food Depository. 

Following the success of the first public 

service project, DRI Annual Meeting attendees 

have given their time restoring natural 

habitat in San Francisco’s Golden Gate 

Park, packing food boxes at Bread for the 

City in Washington, D.C., landscaping and 

painting two New Orleans Charter Schools 

after Hurricane Katrina, and giving blood 

for LifeSource in Chicago. DRI even hosted 

a fun-run at the 2008 Annual Meeting in 

New Orleans to benefit the charter schools. 

While business meetings have been a 

part of the DRI Annual Meeting since its 

inception, attendance has become almost 

mandatory for anyone interested in leadership 

within DRI. Virtually every 

group and subgroup within DRI 

convenes at the Annual Meeting. 

Each substantive committee 

holds a business meeting to discuss 

projects such as seminars, 

For The Defense articles, newsletters, 

webinars, and website 

pages and to recruit volunteers 

for those projects. Most substantive 

committees have also been 

offering CLE presentations during 

their meetings. Publication 


chairs, program chairs, webpage chairs, and 

membership chairs from every committee 

get together at the Annual Meeting, as 

do SLDO leaders, state representatives, regional 

leaders, the Law Institute, the NFJE, 

the DRI Board of Directors, and most DRI 

standing committees and task forces. 

Selection of DRI’s next second vice president 

(who will lead the organization three 

years hence) and the four directors elected 

nationally takes place at the Annual Meeting. 

Any DRI member can schedule a time 

to meet with the nominating committee at 

the Annual Meeting to discuss his or her 

opinions regarding who should fill these 

leadership positions. The new leaders have 

traditionally been announced at the President’s 

Gala Saturday, where the new President 

is installed. (This year, for the first time, 

a blast email will be sent to DRI’s entire membership 

immediately after the board meeting 

and election on Saturday afternoon.) 

Planning for the Annual Meeting begins 

several months in advance. DRI’s presidentelect 

leads the Annual Meeting Steering 

Committee’s organization of this event. The 

steering committee, made up of 12 to 15 member 

volunteers (including committee leaders, 

state representatives, 

SLDO executive directors and 

members at large) decides all details of the 

four-day event. DRI’s professional and highly 

skilled staff is instrumental in shepherding 

the committee to ensure a highly successful 

event each year. With contributions from numerous 

DRI staff members, including Sandra 

Galindo, Beth DeMars, John Hovis, Cheryl 

Palombizio and Katie Malinich, DRI’s Director 

of Meeting Services Lisa Sykes oversees 

all aspects of the planning amidst the 

ever- present leadership of Nancy Parz, Tyler 

Howes and, of course, John Kouris. 

At the Annual Meeting next month, 

R. Matthew Cairns of Gallagher, Callahan 

& Gartrell, will be installed as DRI’s new 

president. He and his Annual Meeting Chair 

Charles Stewart III of Bradley Arant Boult 

Cummings have led the planning of what 

promises to be the best Annual Meeting in 

DRI history. The blockbuster speakers will 

be NPR and Fox News political correspondent, 

Mara Liasson; Navy Seal and author 

of Lone Survivor, Marcus Luttrell; author, 

columnist and radio host, Matt Miller; and 

CNN anchor and special correspondent, 

Soledad O’Brien. In addition to the many 

other outstanding CLE sessions and SLDO 

conclave, there will be a corporate counsel 

program open only to in-house 

lawyers. Many corporations are 

also having counsel meetings 

this year. On Thursday evening 

the off-site reception will be on 

the USS Midway where attendees 

will be able to explore the ship and 

ride a flight simulator. The public 

service project will benefit San 

Diego’s Ronald McDonald House. 

Please join us this year for education, 

networking and service, and 

become a part of DRI history.

I have a network of committed, like-minded defense 

attorneys. I receive business referrals every day. My 

clients benefit from the timely education I receive. My 

partners value me as a thought-leader. I have an 

advocate who serves my defense practice. 

I am a DRI lawyer. 

w w w . d r i . o r g


Class Actions in 

Diversity Actions 

By Michael R. McDonald 

and Damian V. Santomauro 

The Complex 

Interplay Between 

Rule 23 and 

State Laws 

State statutes will be 

carefully analyzed as 

plaintiffs eagerly test the 

breadth of Shady Grove 

and its potential to allow 

otherwise barred class 

action complaints. 

In the recent plurality opinion in Shady Grove Orthopedic 

Associates, P.A. v. Allstate Insurance Company, the 

United States Supreme Court held that a New York state 

statute barring class actions seeking to recover statutory 

penalties did not apply to state law claims 

in federal court because the New York law’s 

validity was preempted by Federal Rule of 

Civil Procedure 23. 130 S. Ct. 1431 (2010). 

As a result, certain state law class actions 

may become viable in federal court diversity 

cases even though state law would otherwise 

prohibit those actions in state court. 


■ Michael R. McDonald and Damian V. Santomauro are directors in the Business & Commercial Litigation 

Department of Gibbons P.C. in Newark, New Jersey. Mr. McDonald is a member of DRI’s Product Liability 

Committee and its Mass Torts SLG.

Shady Grove is noteworthy for the unusual 

constellation of justices joining the 

three opinions issued by the Court. Justice 

Scalia authored the main opinion and was 

joined by Chief Justice Roberts and Justices 

Thomas and Sotomayor. Justice Stevens 

issued a concurring opinion joining 

the result, while Justice Ginsburg authored 

a dissenting opinion, joined by Justices 

Kennedy, Breyer, and Alito. More importantly, 

though, Shady Grove has uncertain 

but potentially farreaching implications. 

Although five justices agreed with the result 

in Shady Grove, the Court’s opinion 

is a plurality because no single rationale 

or opinion garnered five votes. Indeed, the 

three separate Shady Grove opinions reflect 

three disparate approaches—none of 

which a majority of justices appear to have 

agreed with—to resolving disputes that 

can develop in federal court diversity actions 

involving application of federal rules 

and procedures to state law claims. Thus, 

issues involving the interplay between the 

Federal Rules of Civil Procedure and state 

statutes and rules remain far from settled. 

This uncertainty will likely lead to significantly 

increased litigation in the federal 

court system involving application of Federal 

Rule of Civil Procedure 23 to state statutes 

and rules about class actions. 

The Supreme Court’s 

Shady Grove Decision 

In Shady Grove a medical practice, Shady 

Grove Orthopedic Associates, provided care 

to an automobile accident victim, Sonia E. 

Galvez, who later assigned to Shady Grove 

her rights to insurance benefits under an 

insurance policy with Allstate. Shady Gove 

submitted a claim to Allstate. Allstate paid 

the claim, but only after the 30 days required 

by N.Y. Ins. Law Ann. §5106(a). Afterward, 

Shady Grove filed an action seeking to recover 

approximately $500 in statutory interest 

that had accrued on the overdue benefits. 

Shady Grove’s complaint, filed in the Eastern 

District of New York, and based on diversity 

jurisdiction under the Class Action Fairness 

Act, 28 U.S.C. §1332(d) (CAFA), sought relief 

on its own behalf and on behalf of a putative 

class of all other policyholders to which 

Allstate owed statutory interest. The district 

court dismissed the complaint for lack 

of subject matter jurisdiction, holding that 

the New York statute, which bars class action 

claims seeking, as Shady Grove did, to 

recover a statutory penalty, applied in diversity 

suits in federal court. N.Y. C.P.L.R. 

§901(b) (“Unless a statute creating or imposing 

a penalty, or a minimum measure 

of recovery specifically authorizes the recovery 

thereof in a class action, an action to 

recover a penalty, or minimum measure of 

recovery created or imposed by statute may 

not be maintained as a class action.”). The 

Second Circuit affirmed, finding that because 

N.Y. C.P.L.R. §901(b) and Fed. R. Civ. 

P. 23 addressed separate issues and, therefore, 

did not conflict, N.Y. C.P.L.R. §901(b) 

applied in a diversity case. 

The Shady Grove Court was confronted 

with the tension inherent in earlier jurisprudence 

about which law would apply in 

an action pending in federal court on the 

basis of diversity jurisdiction. At the heart 

of this tension is forum shopping—a situation 

in which a party selects a particular 

forum to obtain a litigation advantage 

that would not otherwise exist. On the one 

hand, the Court’s line of cases following 

Erie Railroad Co. v. Tompkins, 304 U.S. 64 

(1938), have indicated that state substantive 

law and federal procedural rules apply in 

diversity actions in federal court and that 

courts determine whether a rule affects the 

availability of a substantive right to ascertain 

whether it is substantive or procedural 

rule under the oft- referenced “outcomedeterminative” 

test. See, e.g., Gasperini 

v. Ctr. for Humanities, Inc., 518 U.S. 415 

(1996) (holding that “New York’s law controlling 

compensation awards for excessiveness 

or inadequacy can be given effect, 

without detriment to the Seventh Amendment”). 

On the other hand, the Court’s 

jurisprudence following Sibbach v. Wilson 

& Co., 312 U.S. 1, 61 S. Ct. 422, 85 L. Ed. 479 

(1941), suggests that Erie is not implicated 

when a Federal Rule of Civil Procedure covers 

an issue. That is, a court should only 

conduct the Erie analysis if a Federal Rule 

of Civil Procedure does not apply or is otherwise 

invalid. See, e.g., Hanna v. Plumer, 

380 U.S. 460 (1965) (holding that “the 

adoption of Rule 4 (d)(1), designed to control 

service of process in diversity actions, 

neither exceeded the congressional mandate 

embodied in the Rules Enabling Act 

nor transgressed constitutional bounds, 

and that the Rule [rather than the law of 

Massachusetts, which would have compelled 

a different result] is therefore the 

standard against which the District Court 

should have measured the adequacy of the 

service”). The three disparate opinions in 

Shady Grove reflect different approaches 

to resolving the tension discussed above. 

Justice Scalia’s Plurality Opinion 

Writing for the plurality, Justice Scalia articulated 

a bright-line rule to resolve the 

issue in this case. The Court would first determine 

whether the federal rule of procedure 

“answers the question in dispute.” 130 

S. Ct. at 1437. That is, does the state law conflict 

with the federal rule of procedure If it 

does, then the Court must apply the federal 

rule of procedure “unless it exceeds statu- 



Shady Grove… has 

turned Congress’s intent in 

enacting CAFA on its head. 

tory authorization or Congress’s rulemaking 

power.” Id. In other words, under the 

plurality view, if a Federal Rule of Civil Procedure 

“really regulates procedure,” courts 

must apply it in a diversity case unless it 

violates the Rules Enabling Act, 28 U.S.C. 

§2072(b). Id. at 1445. In reality, the answer 

to the first question will likely be dispositive 

under this approach because, as Justice Scalia 

observed, “we have rejected every statutory 

challenge to a Federal Rule that has 

come before us.” Id. at 1442. Applying this 

test, the plurality determined that both Fed. 

R. Civ. P. 23 and N.Y. C.P.L.R. §901(b) addressed 

the same issue—whether a party 

may “maintain” a class action. Id. at 1439. 

As such, the analysis for the plurality was 

straightforward. Having concluded that 

N.Y. C.P.L.R. §901(b) conflicted with Fed. 

R. Civ. P. 23, and finding that the federal 

rule fell within the Rules Enabling Act’s authorization, 

the plurality determined that 

the Second Circuit erred in applying N.Y. 

C.P.L.R. §901(b) to Shady Grove’s diversity 

action. For the plurality, it was irrelevant 

whether a state law—in Shady Grove, N.Y. 

C.P.L.R. §901(b)—was substantive or procedural. 

As long as the Federal Rule of Civil 

Procedure “really regulates procedure,” it 

would take precedence over a state law in a 

conflict between the two. 

Justice Ginsberg’s Dissent 

Justice Ginsburg, writing for the dissent, 

expressed concern that the Court’s decision 

“approves Shady Grove’s attempt to 

transform a $500 case into a $5,000,000 

award, although the State creating the right 

has proscribed this alchemy.” 130 S. Ct. at 

1460 (Ginsburg, J. dissenting). Cautioning 

that courts should interpret the Federal 

Rules of Civil Procedure “with sensitivity 

to important state interests,” the dissent 

urged that “Rule 23 should be rationally 

read to avoid any collision” with state law. 

Id. at 1463, 1468–69 (quotation marks and 


citation omitted). The dissent’s approach 

was that with an “unavoidable conflict,” the 

relevant inquiry was “whether application 

of the [state] rule would have so important 

an effect upon the fortunes of one or both of 

the litigants that failure to [apply] it would 

be likely to cause a plaintiff to choose the 

federal court.” Id. at 1469 (brackets in original) 

(quotation marks and citation omitted). 

Using this approach, the dissent did 

not find a conflict between Fed. R. Civ. P. 

23 and N.Y. C.P.L.R. §901(b), concluding 

that N.Y. C.P.L.R. §901(b) did not address 

whether Shady Grove could maintain a 

class action in the suit but, rather, merely 

affected its possible remedy. Id. at 1464, 

1466 (“In other words, Rule 23 describes 

a method of enforcing a claim for relief, 

while CPLR §901(b) defines the dimensions 

of the claim itself”). Without a conflict, 

the Court did not need to consider 

whether Fed. R. Civ. P. 23 was authorized 

by the Rules Enabling Act. 

Justice Stevens’ Concurrence 

Justice Stevens’ concurring opinion reached 

the same result as the plurality, but eschewed 

the plurality’s bright-line approach 

to resolving the question of whether a Federal 

Rule of Civil Procedure applies to an 

issue: he adopted a nuanced approach. 130 

S. Ct. at 1454 (Stevens, J. concurring) (“Although 

Justice Scalia may generally prefer 

easily administrable, bright-line rules, his 

preference does not give us license to adopt a 

second- best interpretation of the Rules Enabling 

Act. Courts cannot ignore text and 

context in the service of simplicity.”). Justice 

Stevens “agree[d] with Justice Ginsburg 

that there are some state procedural rules 

that federal courts must apply in diversity 

cases because they function as a part of the 

State’s definition of substantive rights and 

remedies.” Id. at 1448. As articulated by Justice 

Stevens, however, the circumstances 

that warranted applying bright-line rules 

supported by the Rules Enabling Act, as 

opposed to reading “text” and considering 

“context,” are quite limited. Id. at 1457 (“In 

my view, however, the bar for finding an 

Enabling Act problem is a high one…. The 

mere possibility that a federal rule would 

alter a state- created right is not sufficient. 

There must be little doubt.”). 

Under Justice Stevens’s approach, a “federal 

rule… cannot govern a particular case 

in which the rule would displace a state law 

that is procedural in the ordinary use of the 

term but is so intertwined with a state right 

or remedy that it functions to define the 

scope of the state- created right.” Id. at 1452. 

In contrast to the plurality, Justice Stevens’ 

approach focused not only on whether the 

Federal Rule of Civil Procedure was procedural, 

but whether the particular state law 

addressed substantive rights. Applying 

this approach to Fed. R. Civ. P. 23 and N.Y. 

C.P.L.R. §901(b), Justice Stevens noted that 

“[b]e cause Rule 23 governs class certification, 

the only decision is whether certifying 

a class in this diversity case would ‘abridge, 

enlarge, or modify’ New York’s substantive 

rights or remedies.” Id. at 1459. Justice Stevens 

determined that a plain reading of N.Y. 

C.P.L.R. §901(b) indicated that it was “a rule 

in New York’s procedural code about when 

to certify class actions brought under any 

source law,” and as such, concluded that it 

was “a procedural rule that is not part of 

New York’s substantive law.” Id. at 1148. As 

a result, Justice Stevens agreed with the plurality’s 

determination that Fed. R. Civ. P. 23 

applied to Shady Grove’s diversity action. 

The Ironies of Shady Grove 

There are a couple of significant ironies that 

flow from Shady Grove. First, the plurality 

not only openly recognized that the Court’s 

decision encouraged forum shopping, but 

the Court also found it perfectly acceptable. 

130 S. Ct. at 1148. (“[D]i verg ence 

from state law, with the attendant consequence 

of forum shopping, is the inevitable 

(indeed, one might say the intended) 

result of a uniform system of federal procedure. 

Congress itself has created the possibility 

that the same case may follow a 

different course if filed in federal instead 

of state court. The short of the matter is 

that a Federal Rule governing procedure is 

valid whether or not it alters the outcome of 

the case in a way that induces forum shopping.”). 

Such acceptance of blatant forum 

shopping appears at odds with the mandate 

of the Court in Erie—and followed 

in the Hanna line of cases—that deciding 

whether to apply a state or federal rule or 

law turns on the “twin aims of… discouragement 

of forum- shopping and avoidance 

of inequitable administration of the laws.” 

Hanna v. Plumer, 380 U.S. 460, 468 (1965). 

Regardless of how the Shady Grove plu-

ality’s willing acceptance of forum shopping 

comports with the Court’s precedents, 

Shady Grove will have significant consequences, 

namely allowing claims, previously 

restricted to individual actions, to 

proceed as class actions. Indeed, as the dissent 

noted, “substantial variations between 

state and federal money judgments may 

be expected” following Shady Grove. 130 

S. Ct. at 1471 (quotations marks and citation 

omitted). For example, a federal court 

venue will now permit Shady Grove to seek 

relief ten thousand times greater than the 

remedy available to it in state court. 

The other irony of Shady Grove is that 

it dramatically undermines the principles 

underlying CAFA. In enacting CAFA, Congress 

intended to limit the overall number 

of class actions that state courts would 

certify by creating a mechanism through 

which class actions involving at least 100 

members and seeking at least $5,000,000 

could be removed to federal court. One of 

Congress’s primary goals in enacting CAFA 

was to make it harder for plaintiffs’ lawyers 

to engage in “gaming the system,” which 

typically involved trying to avoid diversity 

jurisdiction and filing class actions in state 

courts “with reputations for readily certifying 

classes and approving settlement without 

regard to class members’ interests.” S. 

Rep. No. 109-14, Section III (Purposes), at 4, 

5 (2005). Indeed, as Justice Ginsburg noted 

in her dissent, CAFA “sought to check… the 

overreadiness of some state courts to certify 

class actions.” 130 S. Ct. at 1473. Shady 

Grove, however, has turned Congress’s intent 

in enacting CAFA on its head and allows 

class action claims barred in state 

court to become viable solely by virtue of 

CAFA. Accordingly, a likely outgrowth of 

Shady Grove will be a significant rise in 

the number of plaintiffs who will now affirmatively 

plead CAFA jurisdiction to obtain 

entry into the federal court system to 

pursue class action claims that they cannot 

file in state courts. In other words, Shady 

Grove has created an anomalous situation 

in which class action plaintiffs and their 

lawyers can “game the system” in reverse 

by seeking federal diversity jurisdiction for 

class actions that are barred in state courts. 

The Impact of Shady Grove 

In addition to offering plaintiffs’ attorneys a 

way to “game the system,” Shady Grove probably 

has other legacies. First, it will probably 

lead to confusion in the lower courts in diversity 

cases because it did not offer a clear 

rule or standard backed by a majority opinion. 

Second, Shady Grove will probably have 

an instant, substantial effect in diversity actions 

in which the New York state law, N.Y. 

C.P.L.R. §901(b), applies. Third, it may make 

inapplicable some aspects of other state statutes 

dealing with class actions. 

No Overarching Rule from Shady Grove 

For all of its analysis of complex civil procedure 

issues, Shady Grove actually provides 

little guidance to lower courts and practitioners 

because of the varying approaches 

expressed in the three opinions. Indeed, 

the absence of a clear majority rule or 

standard in Shady Grove may result in confusion 

among the various circuit courts of 

appeals and district courts attempting to 

apply Shady Grove in diversity cases. As 

a result, it would not be surprising if the 

Court were to further refine the analysis in 

Shady Grove in the near future. Justice Stevens’ 

retirement has added an additional 

wrinkle in that his replacement will likely 

have a significant role in determining the 

Court’s approach to cases involving alleged 

clashes between the Federal Rules of Civil 

Procedure and state law. Accordingly, prognostications 

about the potential, future, 

substantive consequences of Shady Grove 

are little more than speculation. 

If, as in the case of Shady Grove, “a fragmented 

Court decides a case and no single 

rationale explaining the result enjoys the assent 

of five Justices,” the “narrowest ground” 

on which the judgment rests then represents 

the controlling rule. Marks v. United States, 

430 U.S. 188, 193 (1977). As articulated in a 

subsequent decision described in more detail 

below, after Shady Grove, the “narrowest 

ground” on which the plurality and the concurrence 

agreed is this: “irrespective of Erie, 

§901(b) does not apply to state-law claims in 

federal court because it is validly preempted 

by Rule 23.” Holster v. Gatco, 130 S. Ct. 1575, 

1575 (2010) (Scalia, J. concurring). 

N.Y. C.P.L.R. §901(b) Will Not Apply to 

State Law Claims in Federal Court 

Though the central holding of Shady Grove 

is narrow, the decision will likely have a 

significant, immediate impact on diversity 

actions in which New York state law 

applies. Specifically, N.Y. C.P.L.R. §901(b) 

will no longer impede class actions alleging 

New York state law claims in diversity 

cases. In this respect, Shady Grove dramatically 

departs from existing decisional 

authority. See, e.g., In re Auto. Refinishing 

Paint Antitrust Litig., 515 F. Supp. 2d 544, 

550 (E.D. Pa. 2007); Paul v. Intel Corp. (In re 

Intel Corp. Microprocessor Antitrust Litig.), 

Justice Stevens’ 

concurrence will 

likely become a critical 

component of the analysis 

in determining the extent 

to which the Shady Grove 

rationale will be extended. 

496 F. Supp. 2d 404, 415, n. 7 (D. Del. 2007). 

Class action plaintiffs will likely rush to 

assert New York state law claims as class 

actions in federal courts that they could not 

pursue as class actions in New York state 

courts, such as violations of New York’s 

antitrust law, N.Y. Gen. Bus. Law. §340, 

and New York’s Consumer Protection Act, 

N.Y. Gen. Bus. Law. §349, both of which 

permit statutory penalty awards. 

One potential exception might involve 

class actions asserted under the Telephone 

Consumer Protection Act (TCPA), 47 U.S.C. 

§227. This unique federal statute, which covers 

certain facsimile transmissions, telephone 

calls, and prerecorded telephone calls 

and involves statutory penalties, creates a 

private right of action as follows: “A person 

or entity may, if otherwise permitted 

by the laws or rules of court of a State, bring 

[a private action] in an appropriate court of 

that State….” 47 U.S.C. §227(b)(3). Numerous 

decisions have found that N.Y. C.P.L.R. 

§901(b) barred TCPA class actions from proceeding 

in federal diversity cases. See, e.g., 

Bonime v. Avaya, Inc., 547 F.3d 497 (2d Cir. 

2008); Holster v. Gatco, Inc., 2008 U.S. App. 

LEXIS 23203 (2d Cir. Oct. 31, 2008), vacated 

and remanded, 130 S. Ct. 1575 (2010). 



Shady Grove’s impact on these decisions 

is uncertain because of the TCPA’s 

unique nature. The TCPA conditions a private 

action on whether the applicable state’s 

laws or court rules permit a party to pursue 

that action in the courts of that state. 

Nevertheless, Shady Grove could possibly 

open the floodgates to TCPA class action 

lawsuits by New York plaintiffs previously 

foreclosed from filing them. Recently, the 

United States Supreme Court, in a two 

sentence order accompanied by a concurrence 

from Justice Scalia and a dissent by 

Justices Ginsburg and Breyer, vacated and 

remanded the Second Circuit’s decision in 

Holster for further consideration in light 

of Shady Grove. Holster v. Gatco, 130 S. Ct. 

1575, 1575 (2010). The decision by the Second 

Circuit on remand will likely further 

define the scope of Shady Grove and the 

potential statutes that may fall within its 

ambit. 

Other State Laws Are Potentially 

Inapplicable in Federal Court 

In addition to N.Y. C.P.L.R. §901(b), a 

myriad of other state laws affecting class 

actions have been potentially implicated 

by Shady Grove. For example, some states 

have statutes creating causes of action, particularly 

consumer protection laws, that 

bar individuals from pursuing violations 

of the statutes as class actions. See, e.g., 

O.C.G.A. §10-1-399 (“Any person who suffers 

injury or damages as a result of a violation 

of Chapter 5B of this title, as a result 

of consumer acts or practices in violation of 

this part, as a result of office supply transactions 

in violation of this part or whose 

business or property has been injured or 

damaged as a result of such violations 

may bring an action individually, but not 

in a representative capacity). Further, 

some states have statutes that expressly 

limit the circumstances in which plaintiffs 

may assert claims under the statutes 

as class actions. See, e.g., Ohio Rev. Code 

§1345.09(B) (“Where the violation was an 

act or practice declared to be deceptive 

or unconscionable by rule adopted under 

division (B)(2) of section 1345.05 of the 

Revised Code before the consumer transaction 

on which the action is based, or an 

act or practice determined by a court of this 

state to violate section 1345.02 or 1345.03 of 

the Revised Code and committed after the 


decision containing the determination has 

been made available for public inspection 

under division (A)(3) of section 1345.05 

of the Revised Code”). Similarly, some 

states have statutes that limit the types 

and amount of damages that individuals 

can recover in a class action. See, e.g., N.J. 

Stat. Ann. §56:12-4 (“Class actions may be 

brought under the provisions of [the Plain 

Language Act], but the amount of punitive 

damages shall be limited to $10,000.00 

against any one seller, lessor, insurer or 

creditor and the amount of attorney’s fees 

may not exceed $10,000.00”). To test the 

limits of Shady Grove, plaintiffs will likely 

file class action claims in federal courts 

based on diversity and allege violations of 

these types of state statutes, which will, at 

least initially, result in an increase in diversity 

class actions in federal courts. 

Justice Stevens’ concurrence will likely 

become a critical component of the analysis 

in determining the extent to which 

the Shady Grove rationale will be extended 

beyond N.Y. C.P.L.R. §901(b) to other state 

laws and rules that address class action 

issues. Specifically, Justice Stevens concurred 

in the judgment of the Court only 

because he viewed N.Y. C.P.L.R. §901(b) as 

“a procedural rule that is not part of New 

York’s substantive law.” 130 S. Ct. at 1448 

(Stevens, J. concurring). And, indeed, as 

Justice Ginsberg pointed out in her dissent, 

Justice Stevens stood on common ground 

with the dissent in that a majority of the 

Court “agrees that Federal Rules should be 

read with moderation in diversity suits to 

accommodate important state concerns.” 

Id. at 1463, n.2 (Ginsburg, J. dissenting). 

Nevertheless, it is unclear how courts 

will resolve apparent collisions between 

Federal Rule 23 and state rules or statutes 

that are “sufficiently interwoven with the 

scope of the substantive right or remedy” so 

that if they applied Federal Rule 23 it would 

“abridge, enlarge, or modify” the state’s 

substantive rights and remedies. Id. at 1456 

(Stevens, J. concurring). Justice Stevens recognized 

that those circumstances, although 

perhaps limited, may exist, suggesting that 

Federal Rule 23 will not preempt all state 

statutes that address class action. 

Although too small a sample to constitute 

an accurate barometer on future decisions, 

two recent decisions from federal 

courts give credence to the view that Justice 

Stevens’ concurrence may become the 

critical opinion in Shady Grove, at least 

when courts grapple with the interplay between 

Fed. R. Civ. P. 23 and state statutes 

and rules. First, In re Whirlpool Corp. Front- 

Loading Washer Prods. Liab. Litig., the District 

Court for the Northern District of Ohio 

expressly relied upon Justice Stevens’ concurrence, 

which it referred to as “the crucial 

fifth vote in Shady Grove,” to conclude 

that, in a diversity action, Federal Rule 23 

did not preempt a provision of Ohio’s statutory 

consumer protection scheme that prohibited 

plaintiffs from maintaining class 

actions in the absence of an Ohio attorney 

general rule or state court decision determining 

that the defendant’s conduct was 

deceptive or unconscionable. 2010 U.S. Dist. 

LEXIS 69254, *6 (N.D. Ohio July 12, 2010) 

(addressing Ohio Rev. Code §1345.09(B)). 

As the court stated: “Here, O.R.C. §1345.09 

purports to define Ohio’s substantive rights 

and remedies by creating a cause of action 

for defrauded consumers and declaring the 

relief available to them. The class action restriction 

in O.R.C. §1345.09(B) is intimately 

interwoven with the substantive remedies 

available under the OCSPA.” Id. at **6–8 

(citing Shady Grove, 130 S. Ct. at 1456 (Stevens, 

J. concurring)). 

Similarly, in Bearden v. Honeywell Int’l 

Inc. the District Court for the Middle District 

of Tennessee held that a plaintiff’s 

class action claims pursuant to the Tennessee 

Consumer Protection Act, Tenn. 

Code Ann. §47-18-104, et seq., were barred 

because the statute only authorized private 

actions to be brought “individually to 

recover actual damages.” 2010 U.S. Dist. 

LEXIS 83996, **23–24, 30–31 (M.D. Tenn. 

Aug. 16, 2010) (citing Tenn. Code Ann. 

§47-18-109(a)(1)). In doing so, the court 

rejected the argument by the plaintiff that 

the Shady Grove decision compelled application 

of Rule 23 in lieu of the class action 

bar in the Tennessee statute. Instead, the 

court applied the approach set forth in Justice 

Stevens’s concurrence in Shady Grove 

and ruled that because the class action limitation 

in the Tennessee statute was part of 

the statute’s substantive rights and remedies, 

Rule 23 did not apply. Id. at **30– 

31 (“Applying Justice Stevens’s approach, 

this court finds that the class- action limitation 

contained in the [Tennessee statute] 

Shady Grove, continued on page 85


When Medicare Is a 

Secondary Payer 

By Matthew L. Garretson 

and Sylvius H. von Saucken 

Mandatory 

Insurer 

Reporting 

A current Medicare 

law could make it more 

difficult for parties to 

settle single event and 

mass tort personal injury 

claims on or after October 

1, 2010. Now more 

than ever, practitioners 

must embrace new 

procedures on the front 

end of cases in order to 

minimize disruption 

on the back end. 

On December 29, 2007, President George W. Bush signed 

into law the Medicare, Medicaid and SCHIP Extension 

Act of 2007 (MMSEA), Public Law No. 110-173, adding 

yet more teeth to the Medicare Secondary Payer (MSP) 

Statute. 42 U.S.C. §1395y(b). Section 111 of 

the MMSEA requires the providers of liability 

insurance, including self- insurance, 

no-fault insurance, and workers’ compensation 

insurance, to determine the Medicareenrollment 

status of all claimants and 

report certain information about their 

Medicare claims to the Secretary of Health 

and Human Services. With the objective of 

assisting the secretary to coordinate benefits 

and uncover potential reimbursement 

claims, this important legislation reinforces 

the federal government’s intent to ensure 

that Medicare always is treated as the 

payer of last resort. The penalty for noncompliance 

has teeth indeed—$1,000 per day, 

per beneficiary, for each day an insurer is 

out of compliance. This penalty is in addition 

to the often feared, rarely levied “double 

damages plus interest” penalty that the 

government can impose on defendants, as 

primary payers, if Medicare’s reimbursement 

claim is ignored in a settlement. See 

42 U.S.C. §1395y(b)(2); 42 C.F.R. §411.24. 

The new rules will apply to settlements on 

or after October 1, 2010. The MMSEA Section 

111 Liability Insurance, No-Fault Insurance, 

and Workers’ Compensation User 

Guide, Version 3.1 (July 12, 2010), available 

at http://www.cms.gov/MandatoryInsRep/ 

Downloads/NGHPUserGuideV3.1.pdf. 

The Centers for Medicare & Medicaid 

Services (CMS) is responsible for 

collecting data from applicable reporting 

entities to implement the mandatory 

MSP reporting requirements of Section 

111 of the MMSEA. This information will 

assist the CMS in its “post- payment” debtrecovery 

activities arising from medical 

expenses paid by Medicare on a conditional 

basis. Because Medicare is a secondary 

payer to liability insurance, including 

self- insurance, no-fault insurance, and 

workers’ compensation, the MSP rules are 

intended to identify those situations in 

which Medicare does not have primary 


■ Matthew L. Garretson is the founding partner of The Garretson Firm Resolution Group, which has offices 

in Cincinnati, Ohio, Charlotte, North Carolina, Syracuse, New York, and Chattanooga, Tennessee. The Garretson 

Firm is a corporate member of DRI, with a presence on DRI’s MSP Task Force. They provide mass 

tort/class action settlement allocation and fund administration services. Sylvius H. von Saucken joined 

The Garretson Firm in 2005 and currently serves as its Chief Compliance Officer, Fiduciary and General 

Counsel.

esponsibility for paying for the medical 

expenses of Medicare beneficiaries. 

The MMSEA signifies the next turbulent 

adjustment in the long continuum of change 

since President Bush signed the Medicare 

Prescription Drug, Improvement, and Modernization 

Act (MMA) in December 2003. 

Medicare Modernization Act, Pub. L. No. 

108-173, 117 Stat. 2066 (2003) (codified as 

amended in scattered sections of 42 U.S.C. 

§1395). The MMA further defined Medicare’s 

recovery rights, clarified its enforcement 

powers, and erased all doubt that 

attorneys need to adopt formal processes 

to verify, resolve, and satisfy conditional 

Medicare payments, from the date of an 

injury through the date of a settlement, if 

they work on cases involving Medicare beneficiaries 

who receive personal injury settlements 

or judgments. See 42 U.S.C. §1395y(b) 

(2)(B)(iii) (2000 and Supp. 2004); 42 C.F.R. 

§§411.24(g)–(i). Whereas the teeth added to 

the MSP framework by the MMA in 2003 

targeted the Medicare beneficiary community 

and attempted to clarify that community’s 

obligations, those added by the 

MMSEA have targeted insurers or other primary 

plans. The ongoing transformation of 

Medicare reimbursement policy and practice 

creates continual challenges for lawyers 

and their clients in personal injury and 

workers’ compensation cases. Simply put, 

the days of either treating Medicare as the 

proverbial sleeping dog or punting the issue 

until the end of the case are long gone. 

Who Will Have to Report 

Business entities responsible for complying 

with the reporting requirements of 

Section 111 of the MMSEA are referred to 

by the CMS as “responsible reporting entities” 

(RREs). For liability and workers’ 

compensation settlements, the applicable 

plans, including the fiduciary or administrator 

of the law, plans, or arrangements, or 

the insurers, will have to comply with specific 

reporting requirements. For purposes 

of MMSEA compliance, these reporting 

entities are considered “non-group health 

plans,” or “non-GHPs.” 

To better understand the Section 111 

MMSEA reporting concepts, it helps to 

distinguish who reports for non-GHP purposes 

and who does not. Under the MSP, 

the term “group health plan” (GHP) means 

a plan, including a selfinsured plan, of, or 

contributed to by, an employer, including a 

self- employed person, or an employee organization, 

to provide health care, directly 

or otherwise, to the employees, former employees, 

the employer, or others associated 

or formerly associated with the employer 

in a business relationship, or their families. 

42 U.S.C. §1395y(b)(1)(A)(iv). For 

example, any employer- sponsored plan 

that provides health insurance coverage, 

such as Blue Cross/Blue Shield, or a 

selfinsured plan, such as Wal-Mart Associate’s 

Health & Welfare Plan, would 

have a reporting obligation that started 

January 1, 2009. Non-GHPs, then, are everyone 

else who has an obligation or assumes 

the responsibility for medical 

payments for Medicare- entitled beneficiaries. 

For non-GHPs, the beginning 

reporting time lines have been delayed 

so that everyone can coordinate, as necessary, 

including the CMS, which will receive 

a crush of electronic data starting in 2011. 

In addition to the user guide, three documents 

clarify which business entities need to 

report: the statute, 42 U.S.C. §1395y(b)(8)(F), 

which includes clarifying language, the MM- 

SEA’s Paperwork Reduction Act Supporting 

Statement, which provides definitions, and 

the Alert for Liability Insurance (Including 

Self- Insurance), No-Fault Insurance, and 

Workers’ Compensation: Who Must Report, 

published May 26, 2010, 42 U.S.C. §1395y(b) 

(8) (CMS-10265) (Aug. 1, 2008); see also 

https://www.cms.gov/ MandatoryInsRep/09_Alerts. 

asp (last visited August 4, 2010). 

Can Agents Report on Behalf of RREs 

Yes, agents can register with the CMS on 

behalf of RREs during the initial, data-file 



set-up process. The CMS recognizes that 

business entities use third-party administrators 

and other agents to handle the large 

volume of claims and administration processes. 

Agents are not, however, RREs for 

purposes of Section 111 of the MMSEA. 

RREs may contract with agents to handle 

reporting; however, the RREs remain solely 

responsible and accountable for complying 

Reporting obligations 

for non-GHPs are event- 

specific, as opposed to 

the ongoing reporting 

obligations of GHPs. 

with the CMS instructions for implementing 

Section 111 and for the accuracy of the 

submitted data. 


What Triggers a Reporting 

Obligation for Non-GHPs 

Reporting obligations for non-GHPs are 

event- specific, as opposed to the ongoing 

reporting obligations of GHPs. The reporting 

triggering events for a non-GHP entity 

are accepting responsibility for medical 

services payments or settling or concluding 

a dispute resulting in an award, judgment, 

settlement, or other payment involving an 

injured person currently entitled to Medicare. 

When one of these events occurs, 

a non-GHP needs to report. Non-GHPs 

should not report pending settlements, and 

attempting to report them does not constitute 

compliance with Section 111 reporting 

obligations. 

RREs only report to the CMS about 

Medicare beneficiaries, including deceased 

individuals who were Medicare beneficiaries 

at the time of a settlement, award, 

judgment, or other payment. If a reported 

individual is not a Medicare beneficiary, or 

if the CMS is unable to validate a particular 

Social Security Number or Health Insurance 

Claim Number (HICN) based on the 

submitted information, the CMS will reject 

the record for that individual. This does not 

mean, necessarily, that the reported individual 

is not a Medicare beneficiary, but 

rather that the CMS was unable to identify 

the individual based on the information 

provided. If that happens, an RRE would 

need to further investigate identification 

numbers for the next required submission. 

RREs must report quarterly. 

Equally important is an RRE’s monitoring 

responsibilities. If, for example, an 

individual was not a Medicare beneficiary 

at the time that an RRE assumed responsibility 

for ongoing medical services payments, 

the RRE must continue to monitor 

the entitlement status of that individual 

and report to the CMS when that individual 

does become entitled to Medicare coverage, 

unless the responsibility for ongoing 

medical services payments ends before the 

individual qualifies for Medicare. 

Understanding triggering events in the 

context of the MSP is simple. The sole purpose 

of Section 111 of the MMSEA is to ensure 

that settling parties fully comply with 

the MSP: conditional payments must be verified 

and resolved in all liability, workers’ 

compensation, and no-fault settlements so 

that Medicare’s status as a secondary payer 

is honored. If Medicare beneficiaries’ attorneys 

already verify and resolve Medicare’s 

reimbursement claims in all their settlements, 

these new reporting rules should 

result in business as usual for those attorneys 

and their clients. And, according to 

the Supporting Statement of the MMSEA, 

for most non-GHPs, gathering the required 

data may not create a huge burden for those 

entities that have traditionally coordinated 

proper claim payments with Medicare to 

ensure proper order of payment. 42 U.S.C. 

§1395y(b)(1)(A)(iv). Non-GHP entities not 

currently reporting to the CMS, on the other 

hand, will need to adopt the CMS reporting 

methodology outlined in the user guide. 

The history of the MSP further illuminates 

the true meaning of Section 111 of the 

MMSEA. On December 5, 1980, the MSP as 

we know it today was modified to include 

Medicare’s conditional payment recovery 

rights. It was not until 23 years later, under 

Section 301 of the MMA, that additional 

enforcement provisions were added to the 

MSP that focused compliance on reimbursement 

obligations for settling parties, 

including attorneys and their Medicareenrolled 

clients. Now, Congress has closed 

the loop with Section 111 of the MMSEA 

by placing a reporting obligation on selfinsured 

defendants and insurance carriers. 

The user guide emphasizes that Section 111 

of the MMSEA did not change or remove 

any existing MSP recovery rules, but it 

added reporting obligations to existing 

MSP requirements. As a result, for claimants 

and their attorneys, the obligation is 

still to “verify and resolve” Medicare’s conditional 

payments. But for defendants, the 

sole obligation, through the MMSEA, is to 

verify Medicare entitlement and report to 

the CMS when appropriate. 

What Are the Reporting Rules 

For all triggering events occurring on or 

after October 1, 2010, a RRE must engage 

in a two-step process: 

1. Determine whether a claimant, including 

an individual whose claim is unresolved, 

is entitled to Medicare benefits. 

2. If the claimant is entitled to Medicare 

benefits, electronically submit data 

about the claimant, the injury, and 

other, more specific information concerning 

the settlement to the Secretary 

of Health and Human Services through 

the “Coordination of Benefits Secure 

Website” (COBSW). 

While seemingly straightforward, when 

the MMSEA first became law, practitioners 

needed clarification regarding the intended 

scope of the words “entitled” and “information.” 

Since then, practitioners have 

received guidance in the form of multiple 

“town hall” teleconferences with CMS 

representatives to ensure that they understand 

this process and will comply. On July 

12, 2010, the CMS published Version 3.1 

of the user guide, cited above, which provides 

copious information about Section 

111- compliant reporting. 

Through these open forums, detailed 

interim record descriptions, and the user 

guide, the following points can be gleaned: 

• RREs must report a settlement, judgment, 

award, or other payment, including, 

for instance, when a case has 

not settled, but an initial payment for 

medical expenses has been made because 

an RRE has accepted that responsibility. 

• RREs must report one-time payments 

for settlements, judgments, or awards. 

• If a RRE has accepted an ongoing responsibility 

for medical services payments, 

referred to as an “ORM,” for instance,

as with a workers’ compensation settlement, 

the RRE must report only two 

events: (1) the acceptance of that medical 

payment responsibility; and (2) termination 

of that responsibility. The RRE 

would submit only two reports. For example, 

if an insurer starts making medical 

payments based on an injury, the RRE 

would submit the first report marking 

the initial payment obligation date. Then, 

when the insurer stops making medical 

payments, when the case settles and that 

obligation ends, the RRE would submit 

the second, final report, marking the date 

of settlement. The RRE need not report 

every occasion a payment is made. 

• RREs must report settlements, judgments, 

awards, or other payments regardless 

of an admission or denial of, or 

determination of liability. 

• A RRE, for reporting purposes, only 

needs to report the total obligation, and 

does not have to allocate damages between 

indemnity and medical payments. 

• Section 111 of the MMSEA does not 

require reporting for “property damage 

only” claims. 

• A RRE must, however, report settlements, 

awards, judgments, or other 

payments in which medical services 

payments are claimed or released, 

regardless of allocation by the parties 

or a determination of “no medicals” by 

a court. This does not actually affect a 

RRE’s reporting obligation, although 

it may impact whether CMS can claim 

recovery from that settlement, judgment, 

award, or other payment. 

• Section 111 of the MMSEA does not 

establish an age threshold for reporting 

purposes. 

• A RRE has no reporting obligation if the 

RRE is ready to close a Medicare beneficiary’s 

file but no settlement, judgment, 

award, or other payment related to the 

case has been made. 

• However, if a Medicare beneficiary’s file 

is closed due to a “return to work,” but 

a payment responsibility is subject to 

reopening, or otherwise subject to an 

additional payment request, the RRE 

must add this claimant to its reporting 

list. 

• For liability insurance cases, including 

self- insurance, a RRE must report each 

new payment obligation as a separate 

settlement, judgment, award, or other 

payment. But, if a payment is made 

through a structured settlement or an 

annuity purchase, then only a single 

report is required, reporting the total 

amount of the obligation. 

• The CMS is considering appropriate 

modifications to reporting rules for 

mass tort or Multi- District Litigation. 

Importantly, the CMS provides interim 

reporting thresholds in version 3.1 of the 

user guide. Those interim reporting thresholds 

are as follows: 

1. For no-fault insurance, there is no de 

minimis dollar threshold for reporting 

the assumption/establishment of 

 

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the “ongoing responsibility for medical 

payments” (ORM), or for reporting the 

“total payment obligation to the claimant,” 

referred to as “TPOC,” that is, a 

lump-sum settlement amount “in addition 

to or apart from an ongoing responsibility 

for medical payments.” 

2. For liability insurance, there is no de 

minimis dollar threshold for reporting 

Coordination of benefits 

is Medicare-speak for 

ensuring that if another 

source of coverage is 

available for someone’s 

injury-related care, he 

or she should use it. 

the assumption/establishment of ongoing 

responsibility for medical payments. 

3. For workers’ compensation ORM, claims 

meeting all of the following criteria are 

excluded from reporting for file submissions 

due through December 31, 2011: 

(a) “medicals only”; (b) “[t]he associated 

‘lost time’” for a worker is no more 

than the number of days permitted by 

the applicable workers’ compensation 

law for a “medicals only” claim, or seven 

calendar days, if the applicable law has 

no such limit; (c) all payments have 

been made directly to the medical provider; 

and (d) the total payment does not 

exceed $750. 

4. For liability insurance and workers’ 

compensation “one-time” or “lump 

sum” payments (TPOCs), the following 

dollar thresholds apply: (a) Claim 

reports where the last (most recent) 

TPOC date is prior to January 1, 2012, 

with TPOC amounts totaling $0–$5,000 

are exempt from reporting, except as 

specified in number “5” in this list; 

(b) Claim reports where the last (most 

recent) TPOC date is between January 

1, 2012, through December 31, 2012, 

amounts of $0–$2,000 are exempt from 


reporting, except as specified in number 

“5” below; and (c) Claim reports 

where the last (most recent) TPOC date 

is between January 1, 2013, through 

December 31, 2013, amounts of $0–$600 

are exempt from reporting except as 

specified in number “5,” which follows. 

5. Where there are multiple TPOCs associated 

with the same claim record, the 

combined, cumulative TPOC amounts 

must be considered in determining 

whether or not the reporting threshold 

is met; however, multiple TPOCs must 

be reported in separate TPOC fields. For 

TPOCs involving a deductible, where the 

RRE is responsible for reporting both 

any deductible and any amount above 

the deductible, the threshold applies to 

the total of these two figures. 

The user guide also informs us that these 

thresholds are solely for purposes of Section 

111 reporting and have no applicability 

to any other obligations or responsibility 

with respect to any other MSP provisions. 

CMS representatives made this very 

clear during a March 24, 2009, “town hall” 

conference call. CMS officials have also 

stressed on subsequent conference calls 

that these are interim thresholds and may 

be changed by CMS at any time. 

General Reporting Requirements 

A RRE will submit Section 111 information 

electronically through the “Coordination 

of Benefits Secure Website,” referred 

to as the “COBSW.” Each RRE will have a 

separate identification number (RRE ID) 

unique unto itself. A RRE will submit files 

on a quarterly basis, within an assigned, 

seven-day submission period during each 

quarter. 

Input claim files will contain at least 

49 “data points,” organized by: (1) injured 

party/Medicare beneficiary information; 

(2) injury, incident, or illness information; 

(3) self- insurance information; (4) plan information; 

(5) injured party’s attorney or 

other representative information; (6) settlement, 

judgment, award, or other payment 

information; and (7) additional claimant 

information (where the beneficiary is deceased 

or incapacitated). Further data point 

details are available at www.garretsonfirm.com. 

A RRE will also submit a Tax Identification 

Number (TIN) “Reference File.” 

The TIN may also be the RRE’s federal 

employee identification number (FEIN). 

For the selfinsured, the TIN may be an 

Employer Identification Number (EIN) or 

Social Security Number, depending on the 

particular situation. The TIN “Reference 

File” is submitted with the “Claim Input 

File” so that a RRE does not have to reenter 

its name and address information with 

every “Claim Input Record.” 

Reporting Time Line 

Because the CMS is still completing its 

Coordinator of Benefits Secure Website, 

RREs will have to adhere to a specific time 

line. While the original statutory interpretation 

of Section 111 of the MMSEA 

suggested to settling parties that reporting 

would have to occur starting on July 1, 

2009, in practice, registration should have 

been complete by September 30, 2009. As a 

result, RREs should implement the following 

time line for non-GHP matters: 

RRE Registration: 

Test/production query 

input files accepted: 07/01/09 

Trigger date for ORM 01/01/10 

Claim input file 

testing begins: 01/01/10 

Production claim input 

files accepted: 01/01/10 

Trigger date for TPOC 10/01/10 

9/30/2009 (ongoing 

if not yet registered) 

Initial production claim 

input files due: First Quarter, 2011 

The user guide details the recent changes 

to the implementation time line. While 

RREs are permitted to test until December 

31, 2010, once testing has been completed 

successfully, RREs are required to submit 

their first, live production files during an 

entity- specific, designated, seven-day window 

during the first quarter of 2011. 

File Submission Steps and Timing Issues 

Once insurers and other RREs identify a 

reporting obligation, they will need to take 

steps to both register and implement claims 

procedures that will gather information for 

Section 111 reporting purposes. The key 

element of any claims procedure will be 

determining whether an injured party is a 

Medicare beneficiary. A RRE will have to 

submit to the CMS either the Social Secu-

ity Number or the Health Insurance Claim 

Number for an injured party in each “Input 

Claim File” detail record. A RRE will have 

to submit reports for all claims, whether an 

injured party is or no longer is a Medicare 

beneficiary, that have been resolved or partially 

resolved through a settlement, judgment, 

award, or other payment on or after 

October 1, 2010, regardless of the assigned 

date for a particular RRE’s first database 

submission. A RRE will not need to report 

ongoing responsibility for medical payments, 

or ORMs, that are complete before 

January 1, 2010. But if an ongoing payment 

responsibility starts before January 1, 2010, 

and continues past that date, the RRE will 

need to list that claim in its first submission, 

which will start after January 2011. 

Even though RREs will not need to report 

settlements completed before October 1, 

2010, any ongoing payment responsibility 

assumed by a RRE on or after October 1, 

2010, will still require reporting, according 

to the CMS’ most recent guidance. And in 

practice, many RREs have been voluntarily 

reporting to test these compliance waters 

Identification Numbers’ Importance to 

the Section 111 Reporting Process 

The CMS recognizes the critical importance 

of RREs being able to obtain Social Security 

Numbers or Health Insurance Claim 

Numbers. This is because a Social Security 

Number is the basis for a Health Insurance 

Claim Number. The Medicare program 

uses Health Insurance Claim Numbers to 

identify Medicare beneficiaries receiving 

health-care services and to otherwise meet 

its administrative responsibilities to pay for 

health care and to operate the Medicare program. 

The CMS also uses Health Insurance 

Claim Numbers to ensure that the Medicare 

program makes payments in the proper order 

or takes the proper recovery actions. 

Without this cornerstone, the CMS could 

not systematically link reported data to a 

particular beneficiary. 

Any discussion of providing Social Security 

Numbers cannot happen without 

referring to federal privacy rules under the 

Health Insurance Portability and Accountability 

Act of 1996 (HIPAA). HIPAA created 

regulations that strictly regulate data transfer, 

such as when a Social Security Number 

can be used for personal health information, 

how that information is to be managed 

and used, who can collect it, and how it can 

be shared. Understandably, in today’s “information 

age,” given legitimate concerns 

about identify theft, claimants may hesitate 

to provide their Social Security Numbers 

to insurers and other RREs. However, 

collecting Social Security Numbers and 

similar protected health- identification information 

for the purposes of coordinating 

benefits with the CMS is a required, legitimate, 

and necessary use of Social Security 

Numbers under federal law. See 42 U.S.C. 

§§1395y(b)(1)(A)(iv), 1395(b)(8)(F). 

Despite serving a legitimate function, 

Section 111 does not provide “implied consent” 

allowing RREs to request Medicare 

entitlement information. Section 111 of 

the MMSEA also does not require a claimant 

to authorize a RRE to obtain entitlement 

information from the Social Security 

Administration. The CMS has clarified in 

its many “town hall” teleconferences and 

in its guidance on the MMSEA reporting 

that RREs remain responsible for creating 

procedures to determine claimants’ 

Medicare status. Nevertheless, on April 

16, 2010, the CMS issued an Alert designed 

to assist RREs to prove to settling parties 

the necessity of gathering a settling claimant’s 

Social Security Number. See http:// 

www.cms.gov/MandatoryInsRep/Downloads/ 

RevisedCollectionSSNEINs.pdf. 

To attempt to address this seeming dichotomy, 

the CMS has developed a “Query 

Access System,” accessible from the website 

where RREs will submit Section 111 

MMSEA website reports. A RRE, once registered, 

can use this system to determine 

a claimant’s Medicare entitlement status, 

provided that the RRE submits the appropriate, 

identifying health information. To 

match an individual to determine if he or 

she is a Medicare beneficiary, the CMS’ Coordination 

of Benefits Contractor (COBC) 

uses (1) a Health Information Claim Number 

or a Social Security Number, (2) the 

first initial of the first name, (3) the first 

six characters of the last name, (4) date of 

birth, and (5) gender. First, the COBC must 

find an exact match in its database for the 

Health Information Claim Number or Social 

Security Number. Then, at least three 

out of the four final remaining criteria must 

be matched exactly. If a match is found, the 

COBC returns the correct Health Information 

Claim Number to the RRE. 

How Will Medicare Use 

This Information 

As MMSEA implementation begins, we 

should spend a moment contemplating 

how Medicare will apply this information. 

The statutory language of Section 111 of the 

MMSEA provides that the secretary will 

specify the information that insurers must 

submit that will enable the secretary to 

make “an appropriate determination concerning 

coordination of benefits, including 

any applicable recovery claim.” 42 U.S.C. 

§1395y(b)(8)(B)(ii). 

The phrases “coordination of benefits” 

and “applicable recovery claim” address 

two separate but interrelated issues. The 

former refers to two of the MSP’s activities: 

“prepayment activities” and “post- payment 

activities.” Prepayment activities are generally 

designed to stop mistaken payments 

from occurring when Medicare should be 

the secondary payer. Post- payment activities 

are designed to recover mistaken or 

conditional payments made by Medicare 

when there is contested liability insurance, 

including self- insurance, no-fault 

insurance, or workers’ compensation that 

has resulted in a settlement, judgment, 

award, or other payment. The latter phrase 

involves squaring which entity should have 

paid those expenses. 

More specifically, in the personal injury 

and workers’ compensation context, coordination 

of benefits is Medicare- speak for 

ensuring that if another source of coverage 

is available for someone’s injuryrelated 

care, he or she should use it. If no 

other source of coverage is available, and 

the person is eligible for Medicare, Medicare 

will begin to pay for injuryrelated 

care. Further, recovery claim refers to finding 

some other source of funds later that 

should have paid for care all along. In that 

instance, Medicare will seek and should 

receive reimbursement for injuryrelated 

payments. 

MMSEA Does Not Equal Liability MSAs 

The point of this article is to spark dialogue 

and provide an MMSEA roadmap. In recent 

years, Medicare’s recovery interest time 

frame in personal injury matters has been 

the subject of tremendous scholarly and 

practical debate. Specifically, debate has focused 

on whether Medicare’s recovery interest 

only extends to injuryrelated care costs 



from the date of an injury through the date 

of a settlement, or whether Medicare has an 

interest in settlement proceeds related to the 

cost of future care. In previous articles, our 

firm explored whether Medicare requires 

parties settling a liability claim to calculate 

a “set-aside” amount that the injured claimant 

must spend on injuryrelated care before 

Medicare would pick up the tab again. 

This set-aside is referred to as a “Medicare 

set-aside allocation,” or “MSA.” The roots 

of the set-aside are similar to the coordination 

of benefits concept, which, in effect, 

stands for the proposition that if another 

source of coverage exists, that is, settlement 

dollars earmarked to pay for medical services, 

a claimant should use it first. 

In the workers’ compensation arena, 

the debate has been squarely yet controversially 

answered. If a workers’ compensation 

carrier settles its future obligation 

to pay for injuryrelated care, a proper settlement 

must allocate a portion of the settlement 

proceeds to cover those care costs. 

42 C.F.R. §411.46 (2005). Medicare does not 

pay for care—before or after a settlement— 

until a beneficiary has exhausted his or 

her other funds under workers’ compensation. 

42 C.F.R. §411.45 (2005) (specifying 

two exceptions). So, a beneficiary must 

first spend the portion of a settlement earmarked 

for future injuryrelated medical 

expenses before Medicare will pay for such 

care. 42 C.F.R. §411.46 (2005). 

Many personal injury practitioners think 

that the federal government has never satisfactorily 

addressed the set-aside in liability 

settlements. Certainly, the fundamental 

statutory principle requiring settling parties 

to protect Medicare’s interest in workers’ 

compensation settlements already 

exists and could potentially apply to liability 

settlements as well. 42 U.S.C. §1395y(b)(1), 

amended by Pub. L. No. 109-171, 120 Stat. 4 

(2006). Yet, while the government may not 

need to promulgate new laws or regulations 

before Medicare could extend set-asides to 

liability settlements, obstacles currently exist 

that have made it, in our opinion, very 

difficult to fairly, efficiently, and uniformly 

apply set-asides to liability settlements. 

Specifically, unlike workers’ compensation, 

liability insurance policies generally 

have caps, and the doctrines of comparative 

fault and contributory negligence 

inherent in personal injury cases work 


to decrease final damages amounts. Currently, 

the CMS “set-aside calculation” 

methodology is geared toward the fullvalue, 

“no-fault” workers’ compensation 

statutes. The types of damages in workers’ 

compensation cases, such as “indemnity” 

and “medical” payments, are readily delineated. 

But personal injury settlements tend 

to categorize an array of damages as either 

“general” or “special.” Absent a court finding 

on the merits of a case, presently the 

CMS does not have an efficient mechanism 

to determine the parties’ intent in paying a 

claimant—that is, which portion of a settlement 

has been allocated to medical damages 

and which portion has been allocated 

to non- medical damages. 

“MSA,” or “Medicare set-aside,” has 

become a buzzword in the settlement community 

due to various memoranda from 

the CMS. In the “Patel Memorandum,” 

issued in 2001, the CMS expressed a preference 

for practitioners to use MSAs as the 

means to consider Medicare’s interest in 

workers’ compensation settlements. Subsequent 

memoranda further elaborated on 

the proper application of MSAs in workers’ 

compensation settlements. However, the 

CMS has yet to address the use of MSAs in 

liability settlements. This lack of guidance 

has created uncertainty among practitioners 

involved in liability settlements. 

When Section 111 of the MMSEA was 

announced some opined that Medicare 

would begin requiring liability settlements 

to include MSAs starting July 1, 2009, and 

they expected guidance shortly thereafter 

from the CMS. That interpretation of 

the MMSEA missed the mark as the act 

did not include provisions that protected 

Medicare’s future recovery interests. The 

CMS has not offered formal guidance on 

the issue of MSAs in liability settlements, 

and we believe that it will not in the near 

future. Moreover, the CMS has repeated 

in its “town hall” teleconferences that the 

MMSEA’s settlement reporting requirements 

are not intended to replace or change 

the CMS’ recovery practices. The user guide 

emphasizes that Section 111 did not change 

or remove any existing MSP rules, but only 

added new requirements to the existing 

MSP requirements. The MMSEA is not a 

“Trojan horse” for liability MSAs. 

Simply put, Section 111 of the MMSEA’s 

new requirement that defendants (RREs) 

report information about resolved or unresolved 

claims signals that that CMS is not 

yet content with the regulatory framework 

used to enforce Medicare’s secondary payer 

status. The MSP is a work-in-progress. 

A Time to Change Habits 

From the start of every new case, a claimant’s 

counsel has familiar worries about 

possible third-party recovery rights against 

the client’s claims. These concerns, however, 

are largely new for defendants and 

insurers. Accordingly, insurers will need to 

institute internal procedures to make sure 

that they comply with the MMSEA, taking 

cues from the user guide. Two considerations 

in particular are worth mentioning. 

First, since insurers will need to determine 

the Medicare eligibility status of 

every claimant, regardless of whether a 

claim has been resolved, they may need to 

require each claimant to sign a Social Security 

Form SSA-3288 (Consent to Release 

Information). Insurers can submit this 

to the Social Security office closest to the 

claimant’s residence with a request for 

complete benefit eligibility information. 

Ideally, an insurer should do this when a 

claim is opened and again when the claim 

is resolved through judgment, settlement, 

or award. A claimant who is not eligible 

for Medicare when a claim is initiated may 

have become eligible by the time that the 

claim is finally resolved. The form allows a 

claimant to specify that he or she wants the 

information released to more than one person. 

An insurer should make sure that the 

claimant’s counsel is listed in that section 

of the form so that he or she also receives 

all resulting correspondence. 

Second, insurers must take steps to 

ensure that they can collect, manage, store, 

and transmit required data in a HIPAAcompliant 

manner. Insurers will need to 

deal with claimants’ Social Security Numbers, 

or Medicare Heath Identification 

Claim Numbers, and the other data specified 

in the user guide. In some situations, 

such as resolving Medicare reimbursement 

claims after settlement or seeking approval 

of Medicare set-asides, an insurer will 

need the following to provide the required 

data: a copy of the judgment or settlement, 

medical records, applicable ICD-9 

codes, life-care plans or cost projections, 

Medicare, continued on page 87

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From the Chair 

By Sidney K. Kanazawa 

Improving Skills, 

Demonstrating 

Excellence 

By engaging in our 

committee’s offerings 

and opportunities, 

you can help yourself 

and your colleagues 

become recognized as 

the best trial attorneys 

in the business. 

■ Sidney K. Kanazawa is a partner with McGuireWoods LLP in Los Angeles. 

Mr. Kanazawa is recognized for his experience with bet-the-company 

litigation and crisis matters. With experience in a wide range of trials, he 

approaches conflicts with the goal of maximizing opportunities and minimizing 

risks. 


This is my last message as chair of the DRI Trial Tactics 

Committee and I am happy to report that the committee is 

poised to be better than ever. Effective in October at DRI’s 

Annual Meeting, Tammy Meyer, the current vice chair 

of the committee, will take over as chair 

and John Pierce, a former publications 

chair of the committee, will become vice 

chair. They are both fantastic and will definitely 

take our committee to new heights— 

with your help. Please join them in their 

efforts to continue the good work of this 

committee, which allows DRI members to 

improve their trial skills and demonstrate 

the excellence that has come to be expected 

of DRI lawyers. 

On the publications front, Jon Hickey 

(publications chair) and Laura Meny (publications 

vice chair) have put together the 

fascinating set of articles that follows. The 

articles explore trial preparation, possible 

new U.S. Supreme Court jurisdictional 

issues, limits on challenging plaintiffs’ 

medical treatment, tips on picking jurors, 

and practical lessons drawn from The Godfather 

trilogy. Jon and Laura are looking 

for more articles for the Trials and Tribulations 

newsletter and future issues of 

For The Defense, In-House Defense Quarterly, 

and The Voice. Please contact Jon and 

Laura with your ideas and suggestions for 

new articles. 

On the seminar front, Guy Hughes (program 

chair) and Steve Pasarow (program 

vice chair), together with their seminar 

steering committee—Brooks Magratten 

(Board Liaison), Mark Solheim (Law 

Institute Liaison), Chris Bottcher, Holly 

DiCocco, Chip Ferguson, Jonathan Judge, 

Kyle Lansberry, Colette Magnetta, Michelle 

Marzullo, Denise Motta, Jeff O’Hara, John 

Pierce, Lynn Roberson, Maria Ruiz, and 

Adam Weintraub—are putting together 

another outstanding Damages Seminar for 

2011. The program is set for March 23–25, 

2011 at Caesars Palace in Las Vegas. Opportunities 

to give in-house counsel free transportation, 

registration, and a hotel room 

are available with the planning of counsel 

meetings. Right now, the program includes 

seminars on evaluating cases for a negotiation 

track, dealing with difficult expert 

and lay witnesses, preparing corporate witnesses, 

arguing damages in a non-liability 

case (from a jury research perspective), the 

risks and opportunities of social networking 

sites, lessons from actors on storytelling 

and whole body communication, ethics 

in e-discovery, how premiere trial lawyers 

bring it all together in closing argument, 

what you should know about the coming 

changes in Medicare, and how to effectively 

use motions in limine. Please contact 

the steering committee members to learn 

how you can participate in and organize a 

counsel meeting. 

On the development of law front, John 

Pierce is leading a compilation of a 50-state 

compendium on “price spread,” incorporating 

the collective work of over 70 committee 

members, with an expected publication 

date in late 2010. The committee is working 

to explore the various iterations of what 

can be claimed as compensatory damages: 

the medical bills paid or the medical bills 

charged It is hoped that this compendium 

can be used in amicus efforts, urging appellate 

courts to adopt a just rule that plaintiffs 

are not entitled to claim more than 

they (or someone) paid as medical bills. 

Please contact John with your thoughts 

and insights. 

It has been a pleasure and honor to serve 

as chair and I would like to thank everyone 

who shared in the fun, camaraderie, and 

work of the committee during my term. 

The committee offers many opportunities. 

All that is required is a willingness to 

jump in. Please join us by dropping a line 

and getting involved. You will not regret it. 



Trends Limiting 

Defendants 

By James H. Milstone 

and Beth A. Schenberg 

Contesting 

Medical Care 

in Litigation 

Counsel must be prepared 

to make appropriate 

records and offers of proof 

at trial so that appellate 

courts can address 

unscrupulous personal 

injury-mill practitioners. 

The growth of unconventional medical care and inflated 

billing has caused defendants great concern in personal 

injury tort litigation. Defendants have been asked to pay 

for many odd and unusual medical procedures, and fre- 

quently, it is reasonable to question decisions 

made by claimants and their doctors. 

Medical care is very expensive. It is not difficult 

for unscrupulous claimants to falsify 

and exaggerate their claims by presenting 

large medical bill claims. Defense counsel 

often is placed in the position of questioning 

not only the motivation of the claimants 

but also the honesty and integrity of 

the treating care providers. 

In contrast, traditional tort principles 

severely limit a defendant’s ability to contest 

medical care. These long- recognized 

principles had been intended to protect the 

rights of innocent claimants against tortfeasors, 

even if an innocent party received 

negligent medical care. The principle that 

public policy should bar tortfeasors from 

defending claims by questioning medical 

care, even if blatantly negligent, was recognized 

as far back as the Prosser Hornbook. 

To complicate matters further, our society 

has come to accept a broader range of 

treatments as reasonable medical care. 

“Passive care” by chiropractors for prolonged 

periods, injections from pain specialists 

that can last for years, multiple 

and duplicative diagnostic tests, and other 

alternative treatments are now common. 

Claimants will often present claims for prolonged 

treatment when soft- tissue injury 

appears very minor. 

Courts have now begun to reassess the 

traditional standards of medical care principles 

in tort litigation. What seemed familiar 

and straightforward for many years has now 

become subject to reinterpretation. This article 

will investigate this trend. First, we will 

present a brief review of the divergent authority 

on this subject. Next, we will evaluate 

Sibbing v. Cave, 922 N.E.2d 594 (Ind. 2010), 

a new authority from the Indiana Supreme 

Court. Finally, we will assess the ramifications 

of a limited review of medical decisionmaking 

and evaluate how to address the fair 

concerns of all interested parties. 


■ James H. Milstone and Beth A. Schenberg are attorneys with Kopka, Pinkus, Dolin & Eads, L.L.C., a law 

firm dedicated to the defense of litigated matters in Illinois, Indiana and Michigan. Mr. Milstone and Ms. 

Schenberg represent insurance carriers, third-party administrators and businesses with matters involving 

bankruptcy and creditors’ rights, employment law, product liability, professional liability, restaurant and 

retail, trucking and railroad, and environmental liability claims, among others. Mr. Milstone is also a registered 

mediator and arbitrator.

Divergent Authority 

The familiar standard of “reasonable and 

necessary” still applies to recovery of medical 

expenses. Plaintiffs carry the burden of 

proof, aided by a presumption that medical 

bills, once admitted into evidence, are presumed 

reasonable in amount. See, e.g., Fed. 

R. Evid. 414. However, courts have started 

to limit the defense’s ability to contest medical 

care by limiting the scope of the fact 

finder’s consideration of necessary care. 

Across the United States, courts have differed 

widely in their treatment of the necessity 

of medical care. In some jurisdictions, 

courts have not limited at all the extent to 

which defendants can contest medical care 

by offering experts with different opinions. 

Ponder v. Cartmell, 784 S.W.2d 758 (Ark. 

1990), is an example of that latitude. 

In Ponder, the plaintiff was injured 

when the bus in which she was riding was 

involved in an accident. She claimed that 

she sustained injuries to various parts of 

her body, including her back, neck, and 

left breast. During the trial, her treating 

physician testified that she had a degenerative 

disc disease in her neck, which 

was aggravated by the accident. The physician 

performed two surgical procedures 

on the plaintiff and testified that the treatment 

was necessitated by the injury that 

she received due to the accident. The defendants 

presented an expert witness who 

disagreed with the plaintiff’s treating physician’s 

testimony. The defendants’ expert 

testified that (1) the plaintiff had only suffered 

a neck sprain and lower back sprain 

during the accident, (2) the accident did not 

cause or aggravate the plaintiff’s degenerative 

disc disease, and (3) the plaintiff’s 

treating physician misdiagnosed her symptoms, 

which led to unnecessary surgery. 

The defendants’ expert stated that he would 

not have performed either of the two surgical 

procedures. The plaintiff argued that 

the third portion of the expert’s testimony 

should not have been admitted into evidence. 

Id. at 759–60. 

The court stated, “[c]er tainly, a defendant’s 

medical expert may testify that the 

physical injuries for which the plaintiff 

seeks compensation were not caused by 

the accident.” Id. at 760. The court articulated, 

however, that the plaintiff’s recovery 

should not be diminished due to her treating 

physician’s misdiagnosis. Id. The court 

acknowledged that the jury might have 

determined that the plaintiff should have 

been treated more conservatively and that 

the surgery was an extreme or unnecessary 

measure. Id. at 760–61. Yet, the court 

noted, “so long as an individual has used 

reasonable care in selecting a physician, 

she is entitled to recover from the wrongdoer 

to the full extent of her injury, even 

though the physician fails to use the remedy 

or method most approved in similar 

cases or adopt the best means of cure.” Id. 

at 761. Writing that its holding was consistent 

with the Restatement (Second) of Torts 

§457, the court articulated that “necessary” 

means “causally related to the tortfeasor’s 

negligence.” Id. Thus, the court concluded, 

if a plaintiff proves that his or her need to 

seek medical care was precipitated by the 

tortfeasor’s negligence, then the expenses 

for the care that he or she received, whether 

or not the care was medically necessary, 

was recoverable. Id. 

On the other hand, other jurisdictions 

place more limits on contesting medical care. 

Many jurisdictions have adopted the Restatement 

(Second) of Torts §457, which reads 

If the negligent actor is liable for another’s 

bodily injury, he is also subject to 

liability for any additional bodily harm 

resulting from normal efforts of third 

persons in rendering aid which the other’s 

injury reasonable requires, irrespective 

of whether such acts are done in a 

proper or a negligent manner. 

A good example of such a ruling is Spangler 

v. Wal-Mart Stores, Inc., 673 So. 2d 676 

(La. Ct. App. 1996). In Spangler, the plaintiff 

allegedly slipped on a wet substance in 

the bathroom and hit her back and head on 

the floor while shopping at Wal-Mart. Her 

family doctor treated her for a short period 

of time and then recommended that she 

see an orthopedic specialist. She was diagnosed 

with a fractured tailbone. She then 

saw a second orthopedist, who ordered an 

MRI, CAT scan, and thermogram. He also 

ordered physical therapy. When her pain did 

not decrease, he performed an anterior cervical 

fusion. When the plaintiff continued to 

complain of pain, the orthopedist performed 

a bilateral sacroiliac joint fusion. The plaintiff 

still complained of pain, and the orthopedic 

performed a posterior cervical fusion. 

When the plaintiff continued to complain 

of pain, he performed a lumbar fusion. The 

plaintiff then sought the treatment of a rehabilitation 

and pain management doctor, as 

well as a third orthopedic doctor. The third 

orthopedic doctor determined that the previous 

lumbar and posterior cervical fusions 

had not been successful, and he revised the 

lumbar fusion in her lower back and inserted 

a battery- operated, internal bone stimulator. 

Id. at 678–79. 

An orthopedist hired by Wal-Mart was 

permitted to testify that, in his opinion, the 

surgeries were inappropriate and unnecessary. 

To form the basis for his opinion, 

he reviewed the plaintiff’s medical 

records and examined her on two occasions. 

The expert testified extensively about 

the surgeries that the plaintiff underwent 

before the accident at issue. He opined that 

the plaintiff’s pain was pain exhibited by 

an injured person to reap some benefit. 

Id. at 679. The jury awarded the plaintiff 

$64,000 for physical pain and suffering, 

$25,000 for past and future lost earnings, 

and $186,000 for past medical expenses. 

The plaintiff appealed. She argued that the 

trial court erred by allowing testimony 

from the defendants’ expert that her doctors 

performed unnecessary or inappropriate 

treatment. Id. at 679. Prior to trial, 

the plaintiff had filed a motion in limine to 

prohibit Wal-Mart from introducing evidence 

that the surgeries she underwent 

were unnecessary or inappropriate. The 

motion had been denied. Id. 

The plaintiff maintained that the erroneously 

admitted testimony was very prejudicial 

and affected the jury’s award of 

damages. Id. Although the plaintiff argued 

it was prejudicial, the opinion does not cite 

to any evidentiary rules. 

The Louisiana Court of Appeals stated 

that a tortfeasor is liable for unnecessary 

treatment or overtreatment unless 

the tortfeasor can show that the plaintiff 

underwent the treatment in bad faith. Id. 

The court noted that the jury awarded the 

full amount of medical expenses, making it 

clear that had the jury determined that the 

plaintiff had acted in bad faith in undergoing 

medical treatment, they would not 

have awarded the full amount of medical 

expenses. Id. The court did, however, find 

that the jury’s award of $64,000 for physical 

pain and suffering was an abuse of discretion 

and awarded $250,000 in general 

damages. Id. at 680. 



Claimants will often 

present claims for prolonged 

treatment when soft- tissue 

injury appears very minor. 

Wisconsin takes a different approach, 

as seen in Hanson v. Am. Family Ins. Co., 

716 N.W.2d 866 (Wis. 2006). In Hanson, 

the plaintiff was injured when her car was 

hit from behind by a truck. She developed 

lower back, neck, and rib pain, and her 

family physician treated her. She began 

undergoing physical therapy. She also was 

diagnosed with posttraumatic cervical dorsal 

strain. After several subsequent tests, 

the plaintiff was referred to a neurosurgeon 

who recommended surgery. The plaintiff 

had surgery to remove the C4, C5, 

and C6 discs, and they were replaced with 

bone graph material. The issues before 

the trial court were whether the plaintiff 

was injured in the accident and, if injuries 

existed, the extent of those injuries. Id. at 

868–69. 

The defendants argued that the plaintiff’s 

surgery had been unnecessary. To support 

this assertion, the defendants hired an 

expert to testify about the necessity of the 

plaintiff’s surgery. When asked if the plaintiff’s 

surgery had been caused by the accident, 

the defendants’ expert responded, 

“No.” He testified, “I do not feel the surgery 

was medically necessary.” He also raised 

the possibility that the surgery was an act 

of malpractice during cross- examination. 

However, the defendants’ expert conceded 

that the plaintiff initially went to the doctor 

as a direct consequence of the accident 

and that she had acted appropriately 

in following her doctor’s recommendation 

to undergo surgery. The plaintiff’s neurosurgeon 

testified that the surgery was 

“necessary,” and the structural damage to 

her spine was caused by the accident. The 

plaintiff argued that the neurosurgeon’s 

testimony, combined with the fact that she 

had acted appropriately in finding a doctor 

and following his instructions, prevented 

the jury from decreasing the damages to 


compensate for mistakes in the medical 

treatment. Id. at 869. 

The jury awarded past medical expenses 

of $25,000, past lost earning capacity of 

$7,250, and future medical expenses of 

zero. The $25,000 awarded for past medical 

expenses was approximately the amount 

of the plaintiff’s medical expenses after 

the accident but before the surgery. Id. at 

869–70. 

Following the verdict, the plaintiff filed 

a post- verdict motion requesting, among 

other things, an award of all past medical 

expenses or, alternatively, a new trial. The 

court denied the motions, and the plaintiff 

subsequently appealed. On appeal, the 

court granted the plaintiff all past medical 

expenses and a new trial on the issues of 

past and future pain and suffering and loss 

of earning capacity. Id. at 870. 

The Wisconsin Supreme Court discussed 

the Selleck rule, which states that when a 

tortfeasor causes an injury to another person 

who then undergoes unnecessary medical 

treatment of those injuries, despite 

having exercised ordinary care in selecting 

a doctor, the tortfeasor is responsible for 

all of that person’s damages arising from 

any mistaken or unnecessary surgery. Id. 

at 871 (citing Selleck v. Janesville, 75 N.W. 

975 (Wis. 1898)). The court concluded that 

the Selleck rule applied to the case before it. 

The defendants argued that unnecessary 

medical treatment differs from medical 

malpractice, which causes aggravation 

of injuries. The defendants contended that 

there was no causal relationship between 

the accident and the surgery. To support 

their argument, the defendants pointed to 

testimony of their expert, who had stated 

that he had found no spinal pathology 

causally related to the accident. The defendants 

also argued that the jury verdict, 

which awarded solely pre- surgery medical 

expenses, demonstrated that the jury had 

concluded that the surgery was not causally 

related to the accident. The court disagreed 

with the defendants’ position, stating that 

the jury’s award of pre- surgery medical 

expenses demonstrated that it had believed 

that the plaintiff had been injured in the 

accident and thus rejected the defendants’ 

contention during the trial that she had 

not been injured in the accident. Id. at 873. 

Applying the Selleck rule to the jury’s findings, 

the court declared that the plaintiff 

was entitled to all past medical expenses, 

if she had used ordinary care in selecting 

her physicians. Id. at 873–74. 

The defendants also had argued during 

the trial that the plaintiff was a person who 

often exaggerated her injuries. The court 

stated, “For purposes of the Selleck rule, it 

does not matter if [the plaintiff] is a person 

who is very focused on her physical pain, as 

long as [she] used ordinary care in selecting 

[her physician]. In this case there was 

no dispute that [she] exercised ordinary 

care in selecting [her physician].” Id. at 873. 

In her concurrence, Chief Justice Abrahamson 

recognized a distinction between 

necessary treatment necessary due to injuries 

and additional unnecessary treatment 

arising from the original injuries. Id. at 877 

(Abrahamson, C.J., concurring). She noted 

that the problem with the case was that the 

defendants had tried to argue two different 

theories that they were not liable. Id. Under 

one theory, the defendants had argued that 

“the surgery was performed as treatment 

for injuries sustained in the collision, but 

the surgery was unnecessary.” Id. Chief Justice 

Abrahamson acknowledged that Selleck 

foreclosed this defense. Id. Under the 

second theory, the defendants “may have” 

argued “that the surgery, necessary or not, 

was performed not to treat the injuries that 

Hanson, the plaintiff, sustained in the collision,” 

but to treat an injury that she had 

“sustained at some other time.” Id. at 878. 

Chief Justice Abrahamson stated, “This 

theory, however, was not well developed 

by the defendants and was blended with 

the argument that the surgery was simply 

unnecessary,” leaving the court with 

a “muddled record.” Id. Thus, she was satisfied 

that the majority opinion correctly 

concluded that the Selleck rule applied, and 

the plaintiff was entitled to a new trial on 

the issue of damages. Id. 

Justice Prosser wrote a dissenting opinion 

in this case. He believed that while the 

Selleck rule remained good law, the issue 

was whether the Selleck rule was even 

applicable. Id. at 878 (Prosser, J., dissenting). 

He wrote that he believed that the 

Selleck rule did not apply until a plaintiff 

established a causal connection between 

the defendant’s negligence and the injury 

or condition for which a physician rendered 

improper medical treatment. Id. Justice 

Prosser opined that the majority opin-

ion had failed to discuss whether the accident 

caused the plaintiff’s injury for which 

she received surgery. Id. at 879. Contrasting 

his belief with the majority’s view, he 

wrote, “The majority’s opinion means that 

if a plaintiff can prove a coincidental correlation 

she can satisfy the causation element 

of a negligence claim.” Id. at 879 n.6. Justice 

Prosser noted that the majority opinion 

concluded that because the plaintiff had 

experienced neck pain after the accident, 

the accident had caused the neck pain, but 

that conclusion either absolved the plaintiff 

from proving causation as an element 

of her negligence claim as a matter of law, 

or it completely undermined the sanctity of 

the jury verdict. Id. at 880. 

Sibbing v. Cave 

On March 4, 2010, the Indiana Supreme 

Court weighed in on causation and contesting 

damages for medical expenses in 

Sibbing v. Cave, 922 N.E.2d 594 (Ind. 2010), 

a motor vehicle accident claim. After the 

accident—a hard collision—the claimant’s 

injuries appeared minor. She told officers 

she did not need an ambulance at the scene, 

claimed only a headache, went home, took 

a three-hour nap, and then she went to the 

hospital, with pain in the ribs and right hip. 

She had no fractures, nor did the hospital 

note complaints of back pain. She was sent 

home with pain reliever and instructions to 

follow up with another doctor. Two weeks 

later, though, she had symptoms of back 

pain and sought treatment from an internist. 

The internist ordered a nerve conduction 

study and an MRI, which showed a 

bulging disc at L5-S1, although it did not 

press on the nerve. She had physical therapy 

for several weeks and then unilaterally 

stopped treatment because she felt that 

she was no longer improving. More than a 

month after the accident, she underwent 

treatment with a chiropractor, whom she 

visited 40 times over the next six months. 

The only evidence that she offered during 

the trial to support her claim was the testimony 

of the chiropractor, who testified 

that the care that she received was reasonable 

and necessary as a result of trauma of 

motor vehicle accident. 

During the trial, the defense did not contest 

liability. The claimant offered medical 

bills of over $16,000. The defense contested 

the medical care, offering a medical 

expert who had reviewed the medical 

records to contest the nerve conduction 

study as inappropriate and unnecessary. 

The defense expert also testified that the 

passive, chiropractic care received by the 

claimant more than four weeks after the 

accident was medically unnecessary. The 

trial court barred the defense expert’s opinions 

on the nerve conduction study and the 

passive care. The matter was submitted to a 

jury, which awarded $71,675. 

The defendant appealed, and the Indiana 

Court of Appeals affirmed the verdict. 

Sibbing v. Cave, 901 N.E.2d 1155 (Ind. App. 

2009). In addition to arguing that the trial 

court had erroneously excluded the defendant’s 

expert testimony, the defendant 

argued that the court had erroneously admitted 

statements made by the emergency 

room physician about the nature of the 

claimant’s injuries and their permanence, 

mistakenly ruling that they did not constitute 

hearsay. The Indiana Court of Appeals 

ruled that the trial court had erred, but 

harmlessly, because other similar opinions 

were also admitted as evidence. 

The Indiana Supreme Court granted 

transfer, and affirmed on March 4, 2010. 

Sibbing v. Cave, 922 N.E.2d 594 (Ind. 2010). 

In Sibbing, the Indiana Supreme Court redefined 

“reasonable and necessary.” The plaintiff’s 

burden to show that incurred medical 

expenses had been “reasonable” now specifically 

applied only to the amount of a bill. 

The court referred to its recent decision 

in Stanley v. Walker, 906 N.E.2d 852 (Ind. 

2009), ruling that the defense could offer 

into evidence discounted amounts accepted 

by medical providers to show the reasonable 

value of medical charges, irrespective 

of the reason for a discount. In Stanley, the 

court stated that the actual charge was not 

the only measure of the reasonable value, 

which it said was “especially true given the 

current state of health care pricing.” Id. 

at 856–57. The burden to prove that care 

was “necessary” now depended solely on 

whether the need for care was caused by a 

tortfeasor’s negligence. 

The Sibbing court next turned to the 

scope that it would allow a defendant in 

attacking a claimant’s medical care. The 

court held that excluding the opinions of 

the defense expert, who believed that the 

claimant had unnecessary medical tests 

and unnecessary chiropractic care, had 

been proper. The court adopted Restatement 

(Second) of Torts §457, reasoning 

that, if a negligent actor is liable for another’s 

bodily injury, he or she is also liable for 

any additional bodily harm resulting from 

the normal effort of third persons in rendering 

reasonably required aid to treat that 

injury, even if the assistive acts have been 

negligent. The court did not want to place 

innocent plaintiffs “in the unenviable position 

of second- guessing” their physicians 

to make sure doctors did not misdiagnose 

or performed only appropriate procedures. 

The court stated that a negligent 

actor should bear liability for those assistive 

efforts because it is reasonably foreseeable 

that medical care providers are human 

and capable of making mistakes. Id. at 621. 

The Sibbing court did limit its holding. 

First, the court stated that “a plaintiff’s 

recovery may be reduced if he fails to obey 

his physician’s instructions and thereby 

exacerbates or aggravates his injury. Id. 

Second, the court did not want its decision 

to be read so broadly that it would allow 

a claimant to recover damages for medical 

treatment “wholly unrelated to a defendant’s 

wrongful conduct.” Id. 

As to causation, the Sibbing court further 

clarified. The court distinguished what 

it meant from the “standard negligence 

doctrine,” requiring proximate cause, 

which has two components: causationin- 

fact and scope of liability. Id. at 603. 

The court defined the scope of liability 

as “whether the injury was the natural 

and probable consequence of the defendant’s 

conduct, which in light of the circumstances 

should have been foreseeable 

or anticipated.” Id. Then, the court opined 

that this scope of liability definition “was 

helpful in understanding the contours of 

this foreseeability aspect when a defendant 

seeks to challenge the nature and extent of 

medical treatment selected and provided 

by a plaintiff’s medical care professionals.” 

Id. at 603. The medical judgment of a claimant’s 

medical care professional could not 

be contested even if it has been unsound 

or erroneous. Id. 

The Sibbing court then asserted that 

future defendants could refute a plaintiff’s 

claim that medical bills were reasonable 

and necessary by (1) contesting 

the amount as unreasonable, (2) showing 

that the defendant’s actions were not 



the cause-in-fact of the care, and (3) showing 

that the damages were not within the 

“scope of liability” as limited by the principle 

that the decisions of medical professionals 

would not be subject to contest. As 

to causationin- fact, the court offered two 

examples of situations in which a plaintiff 

could not recover for care: (1) “damages for 

dental care received following a collision 

Courts have started to 

limit the defense’s ability 

to contest medical care by 

limiting the scope of the 

fact finder’s consideration 

of necessary care. 

in which harm to the plaintiff’s teeth was 

not implicated,” and (2) damages for medical 

treatment that “was not at all necessitated 

by the alleged tortuous conduct but 

by non- aggravated, pre- existing conditions.” 

Id. at 603. 

Writing a separate concurrence, Chief 

Justice Shepard of the Indiana Supreme 

Court voiced concerns over the scope of 

the holding. Justice Shepard wrote that 

“[g]iven the regularity with which this 

Court expresses its faith in the judgment 

of juries,” he was surprised with the holding 

of his colleagues that allowed the claimant 

to provide expert opinions to the jury 

but prohibited the defense from doing the 

same. Id. at 604. While the burdens of proof 

placed on the parties was, in his opinion, 

“hornbook law,” what was new in the rule 

of this case was that “the claimant may 

satisfy the burden of proof simply by tendering 

medical bills in accordance with 

Evidence Rule 413.” Id. He felt that a plaintiff 

must offer expert testimony to demonstrate 

that the defendant’s action caused 

the injury. Id. at 605. Justice Shepard was 

also concerned about the future impact of 

this rule: 

Most of the time, when medical treatment 

is provided by mainstream practitioners, 

there will be little tussle over 


whether the care was reasonable and 

necessary and the practical effect of prohibiting 

a party from tendering probative 

evidence to the jury will not likely 

lead to an unjust verdict. Because I 

am not persuaded that the prohibition 

worked an injustice in this instance, 

I join in affirming the outcome. But 

the breadth of today’s ruling will lead 

future judges and juries to work injustices 

at the very moment when judgment 

is most needed to hold to account 

providers at the edge of reasonably necessary 

treatment, or beyond it. Today’s 

“Sibbing rule” insulates sharp practices 

from scrutiny, which is why I decline to 

join in. 

Id. at 605. 

Ramifications 

While the sympathy shown by the Indiana 

Supreme Court is commendable, the 

approach in Sibbing seems both naive 

and misguided. The “Sibbing” rule places 

unlimited faith in medical providers in not 

allowing defendants to in any way question 

their decisions. While we should recognize 

doctor’s frailties in decisionmaking 

to some extent, this rule has no limits. The 

decision appears to eliminate any approach 

by a defendant to question the type of 

care, its duration, or the amount of testing 

received by claimants. 

The national health care debate has produced 

much concern over unnecessary 

care. Opponents of recently enacted federal 

legislation claim that doctors practice 

defensive medicine to avoid malpractice 

claims, and often overuse diagnostic testing 

and unnecessarily treat patients. Also, 

while health insurance companies have 

tools to manage care, they confront strong 

limitations. 

More importantly, cases involving abuse 

through inflated billing usually do not have 

any pricing tools to limit services. Most 

often, questionable medical providers agree 

with claimants’ counsel to withhold collection 

on bills in return for protection of their 

right to recover from the proceeds of litigation. 

Compromises of fees are common, but 

only after resolution of tort claims. 

Another concern raised in the national 

health care debate has been that our health 

care system divorces patients from the 

expense of care, which hinders control of 

health care cost inflation. Also, critics of 

our health care system fear that the system 

leads to demands by patients for more 

care, testing, and medication prescription 

than are necessary. For example, a doctor’s 

note may read that he did not feel that an 

MRI was necessary to caring for a patient, 

but he ordered one anyway when a patient 

demanded it. 

The Sibbing court failed to appreciate 

the amount of system abuse. If they do not 

have to affirmatively demonstrate the reasonableness 

of incurred medical expenses, 

unscrupulous care providers will have no 

limits on expenses or treatment. In some 

cases that we have already seen, patients 

have received numerous pain injections 

at the same site on the same day. General 

practioners, prescribing medication, 

have sent patients to chiropractors, then to 

neurologists, then anesthesiologists, then 

physical therapists, then back to chiropractors 

in quick succession. Imagine the abuse 

that would occur if defendants cannot contest 

all of these care providers’ charges and 

care. 

The court in Sibbing has also failed to 

appreciate our jury system. In trying a 

case, the argument that a tortfeasor should 

not be able to contest a decision of a health 

care provider is hard to contest, for the very 

reasons identified by the court: a patient 

should not have to second- guess his or her 

doctor. From the defense perspective, this is 

not an argument to take up unless it is clear 

that the warning signs had been clear and 

that a provider should have been secondguessed. 

When, for example, a claimant 

receives six months of chiropractic care 

three times a week but does not improve, 

most reasonable people would expect a 

responsible claimant to stop receiving the 

care or to seek a second opinion. 

Indeed, the Sibbing court did not seem to 

consider situations involving disagreement 

among treating doctors about appropriate 

care. Often a claimant goes to many providers 

who all suggest conservative care before 

finding one who suggests aggressive care, 

or who wants to order medication. Sibbing 

seems to eliminate defendants’ option to 

question care through testimony of independent 

medical experts. It is unclear if 

it eliminates introducing opinions from 

treating doctors questioning other treating 

doctors’ care.

Sibbing’s immediate ramifications in 

Indiana will prevent a tortfeasor in a case 

involving an injury that requires medical 

care arising from an accident from introducing 

evidence from an independent witness 

that questions the claimant’s medical 

care, unless the tortfeasor can demonstrate 

that the choice of doctor was unreasonable. 

Mitigation seems to encompass 

all the interests at stake because it would 

allow a tortfeasor to question the care while 

allowing the claimant to plead that he or 

she should have to second- guess his or her 

doctor and place the burden of proof on the 

defense. The Sibbing court identified this 

defense in its opinion as appropriate, but 

only if a patient failed to obey his or her 

physician’s orders and thereby exacerbated 

his or her injury. 

Further, the Sibbing rule appears to treat 

all care equally, irrespective of the skill 

and training of the medical provider, or 

whether the care was generally accepted by 

the medical community. This seems to have 

concerned Justice Shepard, as noted in his 

distinction between “mainstream” practices 

and “sharp practices,” when he wrote 

that “when medical treatment is provided 

by mainstream practitioners, there will be 

little tussle over whether the care was reasonable 

and necessary,” but that the “Sibbing 

rule insulates sharp practices from 

scrutiny.” Sibbing, 922 N.E.2d at 605. The 

ruling leaves no leeway to question holistic 

medicine, or other treatments that are 

fairly questioned as long as they are related 

to injured parts of the bodies of claimants. 

The decision will lead to some interesting 

positions for defendants. Medical 

opinions will need to focus more on “butfor” 

causation and test the validity of a 

claimant’s assertion that he or she suffered 

actual injury. It appears that defendants 

will have more difficulty attacking past 

medical care than before, which may lead 

defendants to push to begin trials quickly, 

before claimants complete care, to preserve 

defendant’s rights to offer medical 

opinions. Also, insurance carriers can still 

attack unnecessary care through criminal 

prosecution avenues, or through fraud 

investigations. 

In summary, the trend to limit a defense 

from contesting medical treatment is troubling. 

Defense counsel must prepare so 

that during trial they can make appropriate 

records and offers of proof so that appellate 

courts can address unscrupulous 

personal injury- mill practitioners. Courts 

should still allow jurors to use their common 

sense in reviewing medical care that 

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Is U.S. Supreme Court 

Review Inevitable 

By James J. Ferrelli, 

Paul M. da Costa 

and Leslie N. Carter 

New Jersey High 

Court Extends Long- 

Arm Jurisdiction 

A broad impact is likely 

on companies, both 

in the United States 

and other nations, that 

manufacture products 

for U.S. distribution. 

The Supreme Court of New Jersey recently issued a decision 

in Nicastro v. McIntyre Machinery America, in 

which the court held that a foreign manufacturer of an 

industrial recycling machine was subject to New Jersey’s 

■ James J. “J” Ferrelli is a partner, and Paul 

M. da Costa and Leslie N. Carter are 

associates, in the Trial Practice Group 

of Duane Morris LLP in the firm’s 

Princeton, New Jersey, Newark, New 

Jersey, and Philadelphia, Pennsylvania 

offices, respectively. All three 

authors are members of DRI. 

long-arm jurisdiction under the streamof- 

commerce doctrine. See Nicastro v. 

McIntyre Machinery America, Ltd., et al., 

987 A.2d 575 (2010), petition for cert. filed, 

(U.S. May 18, 2010) (No. 09-1343). The 

Nicastro court’s application of a streamof- 

commerce theory over a traditional 

minimumcontacts analysis was rooted in 

the court’s recognition of marketplace globalization 

and accelerated transnational 

commerce. In particular, the Nicastro court 

stressed the integration of the American 

economy into the global economy as the 

justification for extending the reach of 

New Jersey’s long-arm jurisdiction under 

a streamof- commerce theory. This article 

explores the evolving standard under 

which courts decide whether to exercise 

personal jurisdiction, as highlighted by 

Nicastro, and the potential impact that the 

increased vulnerability of foreign manufacturers 

will have on international business 

operations. 

The preeminent issue addressed by the 

New Jersey Supreme Court in Nicastro was 

whether the Due Process Clause of the U.S. 

Constitution rendered a U.S. state powerless 

to provide relief to a resident who suffered 

serious injury from a product sold 

and marketed by a foreign manufacturer 

through an independent distributor when 

the foreign manufacturer knew that the 

final destination might be a consumer in 

that state. 

The plaintiff, Robert Nicastro, filed a 

product liability lawsuit in New Jersey 

state court after losing four fingers while 

working with a recycling machine manufactured 

by J. McIntyre Machinery, Ltd. 

(J. McIntyre), a company organized and 

operating under the laws of the United 

Kingdom. J. McIntyre designed and manufactured 

the recycling machine at its headquarters 

in the United Kingdom, and it 

sold the machine to its exclusive distributor 

located in Ohio, McIntyre Machinery 

America, Ltd. (McIntyre America). 

Subsequently, McIntyre America sold 

the machine to Nicastro’s employer, Curcio 

Scrap Metal. The owner of Curcio 

Scrap Metal purchased the machine from 

McIntyre America after meeting repre- 


sentatives from McIntyre America at a 

trade convention in Las Vegas. The plaintiff 

included McIntyre America and J. 

McIntyre as defendants in the suit, alleging 

that the recycling machine was defective 

insofar as it did not include a safety guard 

to prevent Nicastro’s hand from becoming 

caught in the machine’s blades. 

The foreign manufacturer, J. McIntyre, 

argued that it did not have sufficient minimum 

contacts with New Jersey to justify 

the state’s exercise of personal jurisdiction. 

In support of this argument, J. Mc- 

Intyre explained that it had no knowledge 

of McIntyre America’s distribution of the 

recycling machine to Nicastro’s employer 

in New Jersey, and denied any role or control 

in McIntyre America’s sale of the machine 

to Nicastro’s employer. J. McIntyre 

indicated that it had not placed the recycling 

machine into the stream of commerce in a 

purposeful manner directed toward New 

Jersey, denied marketing the machine in 

New Jersey, and maintained that it had not 

made any contacts or relationships with the 

jurisdiction of New Jersey. J. McIntyre argued 

that it merely placed the machine into 

the stream of commerce outside of New Jersey, 

and this action was insufficient to establish 

personal jurisdiction in the state. 

Nicastro, the plaintiff, took the position that 

New Jersey could exercise jurisdiction based 

on the fact that J. McIntyre placed an allegedly 

defective machine into the stream of 

commerce in such a way that its geographical 

market was the entire United States. The 

New Jersey Supreme Court agreed. 

Discovery established that J. McIntyre 

and McIntyre America were independently 

owned, operated and controlled as distinct 

entities, but that J. McIntyre did direct 

and guide McIntyre America’s advertising 

and sales efforts whenever possible. 

Although the owner of Curcio Scrap Metal 

purchased the recycling machine from 

McIntyre America, the labeling on the 

machine provided J. McIntyre’s name and 

address. Moreover, the recycling machine 

came with an instruction manual that referenced 

safety regulations from both the 

United States and the United Kingdom. 

Discovery also evinced that J. McIntyre 

executives attended exhibitions, trade conventions 

and conferences in various cities 

in the United States between 1990 and 

2005, although none were in New Jersey. 

Nicastro arguably 

reflects the evolution of 

our economy and the 

progression of globalization, 

and acknowledges the 

necessity of the evolution 

of jurisdictional concepts. 

The Supreme Court of New Jersey found 

these facts sufficient to demonstrate “calculated 

efforts to penetrate the overall American 

market.” Nicastro, 987 A.2d at 592. The 

court found that J. McIntyre “clearly knew 

or should have known that the products 

were intended for sale and distribution to 

customers located anywhere in the United 

States.” Nicastro, 987 A.2d at 593. 

The Nicastro court discussed the development 

of the law governing personal 

jurisdiction in performing its analysis. 

Reviewing personal jurisdiction jurisprudence, 

the court explained that “[t]he 

power of a state to subject a person or business 

to the jurisdiction of its courts has 

evolved with the changing nature of the 

American economy.” Nicastro, 987 A.2d at 

582. The New Jersey Supreme Court’s analysis 

included a review of its prior decision 

in Charles Gendler & Co. v. Telecom Equipment 

Corp., 102 N.J. 460 (1986), as well as 

the U.S. Supreme Court’s decision in Asahi 

Metal Industry Co. v. Superior Court of 

Calif., 480 U.S. 102 (1987), and its progeny. 

In Charles Gendler, the New Jersey 

Supreme Court defined the stream- ofcommerce 

theory to establish personal 

jurisdiction over a nonresident manufacturer 

for injuries caused by its defective 

product if a manufacturer introduced 

its product into the stream of commerce 

with actual or imputed knowledge that its 

product would be sold in the forum state. 

The Nicastro court stated that its recognition 

of the streamof- commerce theory in 

Charles Gendler was supported by Asahi 

and other precedent, which had “embraced 

the streamof- commerce theory in one 

form or another.” Nicastro, 987 A.2d at 589. 

The Nicastro court recognized that the 

plaintiff could not satisfy the minimumcontacts 

analysis; rather, the plaintiff’s 

complaint could only survive if jurisdiction 

existed under the streamof- commerce 

theory. After establishing this framework, 

the majority offered insight into its ultimate 

decision, which was that progression 

of international commerce required a 

revamped approach to the exercise of personal 

jurisdiction that would move beyond 

the analytical prisms established in the 

past personal jurisdiction decisions of Pennoyer, 

International Shoe, and World Wide 

Volkswagen. Nicastro arguably reflects the 

evolution of our economy and the progression 

of globalization, and acknowledges the 

necessity of the evolution of jurisdictional 

concepts over time to adapt to changes in 

our society and economy. 

After determining that its prior reasoning 

and holding in Charles Gendler was 

proper, the Nicastro majority concluded 

that “a foreign manufacturer that places 

a defective product in the stream of commerce 

through a distribution scheme that 

targets a national market, which includes 

New Jersey, may be subject to the in personam 

jurisdiction of a New Jersey court in a 

product- liability action.” Id. 

With its finding that the stream- ofcommerce 

doctrine was ideally suited to 

product liability cases, the court reasoned 

that its holding would ensure that manufacturers 

that targeted defective products “at a 

wide geographic market that includes New 

Jersey will not be immune from suit” in 

New Jersey courts. Id. at 591. Nicastro, however, 

acknowledged that certain product liability 

cases involving minor injuries may 

preclude the application of the stream- ofcommerce 

theory insofar as it would violate 

the traditional notions of fair play and substantial 

justice. Similarly, the court noted 

that the minimumcontacts doctrine would 

still apply in contract and other cases. 

The holding set forth in Nicastro was 

based on the majority’s conclusion that J. 

McIntyre “knew or reasonably should have 

known that its distribution scheme would 

make its products available to New Jersey 

consumers.” Id. at 577. Absent J. McIntyre’s 

ability to establish that defending itself in 

a New Jersey court would offend tradi- 



The Nicastro decision 

“stretches our notions about 

due process, and about 

what is fundamentally fair, 

beyond the breaking point.” 

tional notions of fair play and substantial 

justice, the court would permit the exercise 

of personal jurisdiction by New Jersey 

courts. According to the Nicastro majority, 

a foreign manufacturer’s knowledge of 

a distribution scheme by which it receives 

economic benefits will sufficiently establish 

that New Jersey courts can exercise 

personal jurisdiction, even if a manufacturer 

may not control the distribution of 

its products. 

Nicastro: Forging a “New 

and Uncharted Path” 

Counsel for J. McIntyre has filed a petition 

for a writ of certiorari with the Supreme 

Court of the United States, arguing that 

the Nicastro decision is inconsistent with 

legal precedent. Petition for Writ of Certiorari, 

Nicastro (U.S. May 18, 2010) (No. 09- 

1343). J. McIntyre contends that Nicastro is 

a “sweeping departure” from the U.S. Supreme 

Court’s due process jurisprudence. Id. 

at 2. J. McIntyre asserts that the “profound” 

impact of the Nicastro decision is that New 

Jersey will now exercise worldwide jurisdiction 

without regard to constitutional limitations. 

Id. at 2–3. J. McIntyre argues that 

the impact of Nicastro resonates far beyond 

New Jersey’s borders, pointing out that New 

Jersey has a population of almost nine million 

people, who are all potential consumers 

of products manufactured all over world. 

The issues raised in J. McIntyre’s petition 

largely echo the concerns voiced in 

the dissenting opinions by New Jersey Supreme 

Court Justices Hoens and Rivera- 

Soto. See Nicastro, 987 A.2d 575, 594–605 

(Hoens, J., dissenting); Nicastro, 987 A.2d 

575, 605 (Rivera- Soto, J., dissenting). Justice 

Hoens filed a dissenting opinion, in which 

Justice Rivera- Soto joined, stating that the 


version of the streamof- commerce theory 

that the Nicastro majority applied radically 

departed from the articulations of that theory 

as embraced by the New Jersey Supreme 

Court in Gendler and by the opinion of the 

United States Supreme Court in Asahi. 

As stated in Justice Hoens’ dissent, while 

the Nicastro majority’s “repeated quotations 

and soaring language about the realities 

of the global marketplace might compel 

the casual reader to follow what appears to 

be the majority’s relentless logic,” these 

allusions to the “global marketplace” cannot 

mask the fact that the Nicastro decision 

“stretches our notions about due process, 

and about what is fundamentally fair, 

beyond the breaking point.” Id. at 594–95. 

According to Justice Hoens, the Nicastro 

majority “has, notwithstanding its protestations 

to the contrary, elected to forge a 

new and uncharted path.” Id. at 595. 

Justice Hoens argued that the Nicastro 

majority strayed far from the precedents 

it purported to apply in its articulation of 

the streamof- commerce theory. According 

to Justice Hoens, the Nicastro majority 

has “abandoned the cautious wisdom of 

Gendler and Asahi, creating in their place 

a new test that consists of but one inquiry: 

whether a product has found its way” into 

New Jersey. Id. Justice Hoens concluded 

that the majority had “replaced a carefully 

balanced test… with an unbounded one 

that presumes that participation in the 

global economy, without more, bespeaks 

purposeful availment of the benefits of this 

jurisdiction.” Id. at 605. Justice Rivera- Soto 

filed a separate, dissenting opinion, stating 

that the Nicastro majority’s decision 

eviscerated “established notions of constitutional 

decision making that formed the 

bedrock of our federal system.” Id. Justice 

Rivera- Soto concluded that this decision 

was “ripe for review and correction by the 

Supreme Court of the United States.” Id. 

Personal Jurisdiction Jurisprudence 

The Nicastro majority indicated that the decision 

was intended to affirm the New Jersey 

Supreme Court’s ruling in Gendler, 102 

N.J. 460. Any analysis of the reasoning behind 

the Nicastro decision necessarily must 

discuss the Gendler and Asahi opinions, 

as well as other applicable legal precedent. 

In Gendler, the New Jersey Supreme 

Court reversed the judgment of the lower 

court, which found that the appellant, an 

international manufacturer, had sufficient 

contacts to subject the manufacturer to 

the court’s jurisdiction. The only evidence 

in the record relating to the stream- ofcommerce 

theory was the appellant’s certification 

that it manufactured telephone 

equipment for sale to companies throughout 

the world. Id. at 468. 

After the appellee, a corporation, alleged 

that certain telephone equipment did not 

perform as warranted, the corporation 

sued the international manufacturer, 

which had its principal place of business 

in Tokyo, Japan. Id. The trial court granted 

the international manufacturer’s motion to 

dismiss, and the appellate division reversed 

the judgment. The New Jersey Supreme 

Court reversed the judgment of the appellate 

division, and held that the appellant, 

the international manufacturer, was not 

subject to personal jurisdiction. Although 

the streamof- commerce theory applied in 

the action, the New Jersey Supreme Court 

stated that the record offered insufficient 

evidence to determine whether the appellant, 

the international manufacturer, was 

aware of or should have been aware of the 

distribution system of its phones in the 

United States. Therefore, the court was 

reluctant to find that the appellant, the 

international manufacturer, was subject to 

personal jurisdiction. Id. 

In Gendler, the New Jersey Supreme 

Court held that a state court’s assertion of 

personal jurisdiction over a defendant must 

comport with the due process requirement 

of the Fourteenth Amendment. Gendler, 

102 N.J. at 469. The Gendler court noted 

that New Jersey’s long-arm statute permitted 

service of process on nonresident defendants 

“consistent with due process of 

law,” which consequently would “allow outof-state 

service to the uttermost limits permitted 

by the United States Constitution.” 

Id. The New Jersey Supreme Court considered 

the changes in the law governing personal 

jurisdiction over the years, noting 

the United States Supreme Court’s determination 

that due process required that a 

defendant have certain minimum contacts 

with a forum and that the exercise of jurisdiction 

did not offend “traditional notions 

of fair play and substantial justice.” Gendler, 

102 N.J. at 469 (quoting International 

Shoe Co. v. Washington, 66 S. Ct. 154, 158

(1945)). The court noted that the purpose of 

the minimum contacts test was to ensure 

the fairness and reasonableness of requiring 

a nonresident to defend a lawsuit in the 

forum state. Gendler, 102 N.J. at 470; International 

Shoe, 66 S. Ct. at 158. The New 

Jersey Supreme Court noted that “[g]iven 

this focus, the jurisdictional test is not to 

be applied mechanically.” Gendler, 102 N.J. 

at 470. Rather, a court must examine the 

“quality and nature” of the defendant’s 

activity “in relation to the fair and orderly 

administration of the laws” on a case-bycase 

basis to determine if the minimumcontacts 

standard was satisfied. Gendler, 

102 N.J. at 470; International Shoe, 66 S. Ct. 

at 159–160. 

The Gendler court acknowledged that 

“the due- process limitation protects the 

defendant’s liberty interest in not being 

subject to the entry of a judgment in a jurisdiction 

with which the defendant does not 

have sufficient minimum contacts.” Gendler, 

102 N.J. at 470 (citing Burger King 

Corp. v. Rudzewicz, 105 S. Ct. 2174, 2181– 

82 (1985)). The New Jersey Supreme Court 

further acknowledged in Gendler that 

“[b]y precluding state courts from unfairly 

requiring non- residents to defend themselves, 

the due- process clause also insures 

[sic] that a state’s grasp does not exceed 

its jurisdictional reach.” Gendler, 102 N.J. 

at 470. By focusing on the nonresident 

defendant’s contacts with the forum, the 

minimumcontacts test’s intention was 

to protect a defendant’s liberty interest. 

Id. In considering when it was fair to subject 

the defendant to suit in the forum, 

the Gendler decision echoed U.S. Supreme 

Court precedent, noting that a defendant’s 

contacts with the forum state must be 

such that it “should reasonably anticipate 

being haled into court there.” Id. at 470; 

World-Wide Volkswagen Corp. v. Woodson, 

100 S. Ct. 559, 567 (1980). The New 

Jersey Supreme Court noted in Gendler 

that “the minimumcontacts test gives a 

degree of predictability to the legal system 

that allows potential defendants to 

structure their primary conduct with some 

minimum assurance as to where that conduct 

will and will not render them liable 

to suit.” Id. A defendant is on notice that 

it is subject to suit when it “purposefully 

avails itself of the privilege of conducting 

activities within the forum State, thus 

invoking the benefits and protections of its 

laws.” Gendler, 102 N.J. at 471 (citing Hanson 

v. Denckla, 78 S. Ct. 1228, 1240 (1958); 

Burger King, 105 S. Ct. at 2182; World-Wide 

Volkswagen, 100 S. Ct. at 567). The Gendler 

court explained that “the crucial question 

is whether [the foreign manufacturer] was 

aware or should have been aware of a system 

of distribution that is purposefully 

directed at New Jersey residents.” Gendler, 

102 N.J. at 484. Consistent with United 

States Supreme Court precedent, however, 

the court expressly stated that “[i]t is the 

purposeful act of the defendant, not the 

unilateral activity of another who merely 

claims a relationship to the defendant, that 

connects the defendant to the forum.” Gendler, 

102 N.J. at 471 (citing Hanson, 78 S. Ct. 

at 1239–40). 

Further, as noted in Justice Hoens’ dissent, 

an analysis of the plurality opinions of 

the United States Supreme Court in Asahi, 

107 S. Ct. 1026, also made clear that the 

Supreme Court’s core concern in evaluating 

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the exercise of long-arm jurisdiction is due 

process. Nicastro, 987 A.2d 575, 597 (2010). 

Both Justice O’Connor’s plurality opinion 

in Asahi and Justice Brennan’s concurring 

opinion agreed that the basis for all jurisdictional 

questions had roots in traditional 

notions of due process. See Asahi, 107 S. Ct. 

at 1030 (O’Connor, J., plurality opinion); 

Asahi, 107 S. Ct. at 1034–35 (Brennan, J., 

concurring). Moreover, jurisdictional decisions 

must comport with “fair play and 

substantial justice.” See Asahi, 107 S. Ct. 

at 1033 (O’Connor, J., plurality opinion) 

(quoting International Shoe, 66 S. Ct. at, 

158); Asahi, 107 S. Ct. at 1034 (Brennan, J., 

concurring) (quoting International Shoe, 

66 S. Ct. at 160). Each of the plurality opinions 

in Asahi used the same test: whether 

the foreign manufacturer had done something 

to “purposefully avail itself of the 

market in the forum State.” Asahi, 107 

S. Ct. at 1031 (O’Connor, J., plurality opinion); 

Asahi, 107 S. Ct. at 1034 (Brennan, J., 

concurring). 

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Nicastro… appears 

inconsistent with the 

principles articulated in 

Asahi and other personal 

jurisdiction jurisprudence. 


The plurality opinions in Asahi both 

noted that it was inappropriate to define the 

streamof- commerce theory so that a label 

replaced an evaluation of purposeful availment. 

Nicastro, 987 A.2d at 597 (2010). In 

considering the streamof- commerce theory, 

Justice O’Connor in Asahi found that 

merely placing a product into the stream of 

commerce was insufficient to support jurisdiction 

because, without more, it could 

not constitute action purposefully directed 

at the forum state. Asahi, 107 S. Ct. at 1031 

(O’Connor, J., plurality opinion). While Justice 

Brennan reached a different conclusion 

regarding what finding purposeful availment 

demanded, his opinion did not contradict 

the notion that merely placing a product 

into the stream of commerce did not sufficiently 

establish personal jurisdiction over a 

defendant. Asahi, 107 S. Ct. at 1034. 

As noted by Justice Hoens in Nicastro, 

the Asahi plurality opinions both cautioned 

against using stream of commerce “as a surrogate 

for the analysis of the connection between 

the foreign entity and the forum that 

due process demands.” Nicastro, 987 A.2d 

at 598 (2010). The Asahi plurality opinions 

differ only in their definition of what additional 

proofs are necessary in order for the 

assertion of jurisdiction to pass constitutional 

muster. Id. Neither of the Asahi opinions 

equated merely placing a product into 

the stream of commerce somewhere in the 

United States with purposeful availment 

sufficient to comport with due process and 

to support jurisdiction. Id. at 600. 

The Nicastro majority decision appears 

inconsistent with the New Jersey Supreme 

Court’s holdings in Gendler that a due process 

analysis is the core of the personal 

jurisdiction question, and that it is the purposeful 

act of the defendant, not the “unilateral 

activity” of a related entity, that tied 

a defendant to a forum. Gendler, 102 N.J. at 

471 (1986). In addition, the majority decision 

in Nicastro also appears inconsistent 

with the principles articulated in Asahi and 

other personal jurisdiction jurisprudence. 

The Impact of Nicastro 

The Nicastro decision will likely have a 

broad impact on companies outside of New 

Jersey, both in the United States and other 

nations, that manufacture products for distribution 

in the United States, especially 

if a United States-based distributor then 

directs the products to New Jersey consumers. 

Nicastro has established a minimal 

standard for New Jersey courts to exercise 

personal jurisdiction. The key question in 

the future will simply be whether a manufacturer 

has introduced its products into a 

distribution scheme that targets a national 

market that includes New Jersey. 

Jurisdiction under the Nicastro streamof- 

commerce theory does not require a 

showing that the manufacturer exercised 

any control over a distribution scheme. If 

a manufacturer merely had awareness of 

and used a distribution system by which 

it reaped economic benefits from possible 

sales to New Jersey, the companies’ conduct 

would trigger personal jurisdiction in New 

Jersey. The Nicastro court determined that 

mere awareness by the manufacturer that 

its product might be sold in New Jersey satisfied 

the “purposeful availment” requirement 

of past personal jurisdiction case law. 

Consequently, using independent middlemen, 

or some other distribution scheme, 

will not insulate foreign or out-of-state 

manufacturers that place allegedly defective 

products into the U.S. economy when those 

manufacturers clearly know or should know 

that they sell their products for ultimate distribution 

throughout the United States, including 

in New Jersey and in other states. 

The Nicastro majority noted that prospective 

plaintiffs with “lesser injuries” will 

not necessarily be entitled to rely on the 

streamof- commerce theory. Rather, those 

plaintiffs will have to satisfy the traditional 

minimumcontacts analysis. The Nicastro 

decision, however, did not provide any 

guidelines for future courts to use when 

determining what types of injuries would 

trigger jurisdiction under the stream- ofcommerce 

doctrine. Accordingly, all foreign 

manufacturers should understand 

that New Jersey courts will likely assert 

jurisdiction over them whenever a New 

Jersey resident has been injured by a product 

that they manufactured and introduced 

into the United States economy. The 

extent to which courts will apply or decline 

to apply Nicastro to cases involving “lesser 

injuries,” and the determinative factors in 

such cases, will develop in the future. 

On a broad scale, perhaps the Nicastro 

decision will provide the impetus for 

the United States Supreme Court to revisit 

the issue of personal jurisdiction. Courts 

from other jurisdictions seem equally 

unsure of how to navigate the stream- ofcommerce 

doctrine. As noted by the Alabama 

Supreme Court in Ex parte DBI, 

Inc., 23 So. 3d 635 (Ala. 2009), “in the 

murky aftermath of the plurality opinions 

in Asahi, the task [of determining whether 

to exercise personal jurisdiction over a 

defendant] has not been made any easier. 

Until more definite direction is given, 

[courts] revert to the last expressions from 

the United States Supreme Court in World- 

Wide Volkswagen and Burger King that are 

not hampered by the lack of a majority.” Ex 

parte DBI, Inc., 23 So. 3d at 649. Whether 

and the extent to which other state courts 

will follow Nicastro remains to be seen. 

In addition to the uncertain state of personal 

jurisdiction jurisprudence, foreign 

manufacturers should also know about possible 

legislative changes on the horizon. Just 

a few weeks after the Nicastro decision, the 

Foreign Manufacturers Legal Accountability 

Act was introduced in the U.S. Congress. 

The Foreign Manufacturers Legal Accountability 

Act of 2010, H.R. 4678, 111th Cong. 

(2010). The bill is designed to make it easier 

for plaintiffs to hold foreign manufacturers 

accountable in U.S. courts. Similar legislation 

was proposed last year. The Foreign 

Manufacturers Legal Accountability Act 

of 2009, S. 1606, 111th Cong. (2009). Both 

bills are gathering support from members of 

Congress with varied political philosophies. 

Foreign manufacturers should consult their 

legal counsel to determine the potential effect 

of these developments on their international 

business operations and vulnerability 

to suit in U.S. federal and state courts, and 

counsel for foreign manufacturers should 

become familiar with these legislative initiatives.


Are You Ready for Trial 

By Lori E. Iwan 

Turning Chaos 

into Trial 

Preparation 

The work you do in 

advance will minimize 

the chance of an adverse 

outcome for your client. 

Imagine that you learn on the date trial is set on a case you 

have been working on that you will be the first-chair trial 

lawyer on the case. Are you prepared for trial Is the case 

ready for trial 

Preparation is everything when litigating 

cases. This basic premise of trial work 

is well-known by the lawyers who step in 

front of dozens of juries on a regular basis, 

trying cases for weeks and months at a 

time, often back-to-back with other complicated 

cases. There is no substitute for preparation: 

“Preparation is the be-all of good 

trial work. Everything else—felicity of 

expression, improvisational brilliance—is 

a satellite around the sun. Thorough preparation 

is that sun.” Louis Nizer, Newsweek, 

Dec. 11, 1973. Regardless of the number of 

associates and amount of technology surrounding 

a trial lawyer in the courtroom, 

ultimately a trial lawyer alone must stand 

in front of a jury to present a case, and he or 

she must instantaneously decide whether 

to object to questions during the examination 

of witnesses. A trial lawyer must know 

a case to do this well. 

Preparation conveys an impression to a 

judge, a jury, and an opponent that a lawyer 

is confident that the facts and the law favor 

■ Lori E. Iwan, of the Iwan Law Firm, LLC, in Wilmette, Illinois, concentrates 

her practice in the evaluation and troubleshooting of complex commercial 

cases and catastrophic injury and property damage cases. A member of 

DRI’s Trial Tactics Committee, Ms. Iwan has also served as president of the 

Lawyers Club of Chicago and on the board of directors of the FDCC. 

a client. A good trial lawyer knows that if 

every case is prepared as if it is going to 

trial, a prepared lawyer will obtain a favorable 

outcome for a client, oftentimes without 

having to see the case through to a jury 

verdict. Failing to prepare sends a message 

of weakness. 

Preparation includes organization. An 

attorney has many systems to choose from 

to organize a case: a trial notebook system, 

a computerized filing system, or an 

accordion file filled with notes, to name a 

few. But if a lawyer doesn’t know how to 

find notes quickly, identify key portions of 

records, or locate impeaching testimony, 

a system is worthless: “Nothing so undermines 

the confidence of a court or jury in 

a lawyer as his constant groping and fumbling.” 

J. Appleman, ed., Successful Jury Trials 

100 (1952). 

The reality is that no single file organization 

system will work perfectly for all 

lawyers. It takes practice and experience 

to learn what works best for you when you 

must locate key information with limited 

time available. It doesn’t matter what 

works for the lawyer next door or the associate 

preparing a file. Ultimately, the lawyer 

in the courtroom must have a method 

in place that works. The importance of 

experimenting with different systems in 




practice sessions cannot be underestimated. 

You will reap the rewards of experimenting 

and devising a workable and 

comfortable system for the lawyer who 

tries the case: “The lawyer who has at his 

fingertips an unexpected objection on the 

part of his opponent is a professional advocate. 

Neither luck nor a photographic memory 

accounts for most instances of such 

effective advocacy.” A. Leo Levin & Harold 

Cramer, Trial Advocacy—Problems and 

Materials, 7 (1968). 

Preparation also includes knowing when 

and how to object during a trial for strategic 

reasons and how to preserve error 

for appeal: “Objections are not difficult in 

the abstract. They become difficult in the 

midst of a trial because you need to determine 

instantly whether a question or argument 

is objectionable, and if so, whether 

you should lodge the objection or waive 

it.” Ronald J. Waicukauski, “Learning 

the Craft,” 24 Litigation 68 (Spring 1998). 

Rather than objecting to each and every 

“objectionable” question, for many strategic 

reasons an attorney may reserve objections. 

An objection raised in the middle 

of a long string of boring questions may 

alert a jury and highlight a particularly 

sensitive issue. If a colloquy in front of the 

jury follows an objection, it may highlight 

an unfavorable issue. Occasionally, when 

an attorney objects to a question a court 

reporter must repeat it, reading it aloud 

before the judge rules, which only emphasizes 

the unfavorable point, and the error, 

to the jury. A series of overruled objections 

could put an objecting attorney in an 

unfavorable light before a jury. An attorney 

must quickly assess questions posed to a 

witness during a trial and decide if objecting 

has a favorable strategic value. Preparation 

is essential to identify matters to raise 

with a court outside the presence of the jury 

in motions in limine. 

The need for preparation extends to witness 

readiness as well. Volumes have been 

written about the counsel and guidance 

that witnesses should receive before testifying. 

However, the interaction between 

a trial lawyer and a witness is often overlooked. 

A trial lawyer must meet and spend 

time with a witness before he or she testifies. 

Unlike a talk show, which sequesters a 

“witness” in the “green room” until show 

time to encourage spontaneity, a courtroom 

is not the place for surprises. A trial 

lawyer should personally discuss a case 

with each witness to establish rapport and 

so the witness is comfortable with the trial 

lawyer’s speaking and presentation style. In 

turn, a trial lawyer needs to listen to a witness, 

both to ensure that the witness is prepared 

to answer particular questions and to 

become familiar with the witness’ speaking 

style. All too often, a witness is prepared 

in a conference room by a member 

of a trial team, but the litigator meets the 

witness on the way to court, and the testimony 

unfolds in a haphazard and halting 

manner in the courtroom. Preparation can 

avoid this problem. 

How Do You Ready a Case for Trial 

A first-chair litigator is responsible for 

knowing the facts, the issues and the strategy 

for successfully concluding a matter. 

However, cases generally are too complicated 

to expect a first-chair litigator to take 

care of all of the trial, witness, legal, and 

logistical tasks that must be ready before 

a trial begins. It behooves a first-chair litigator 

to meet with the trial team, usually 

the second- chair litigator, the backup associates, 

paralegals, and clerks, as soon as a 

trial date has been set to begin the trial 

readiness phase of a case. 

Trial Tasks 

Case preparation includes tasks unique 

to the trial phase, which will unfold during 

the trial. But a trial team needs to 

have completed certain items before a trial 

begins to be ready for a trial but also should 

have other tasks completed in advance to 

free up valuable time during a trial to be 

able to focus on other issues that arise. 

The lead lawyer need not use valuable time 

attending to these tasks. 

First, a trial court will require a “statement 

of the case” to read to the jury venire 

before jury selection begins. This statement 

is brief, non- argumentative, and 

fairly states the basic claims and party and 

attorney names. A trial team should prepare 

this statement and secure the opponent’s 

approval of it in advance of the trial. 

Second, during jury selection, a trial 

attorney will attempt to deselect unfavorable 

jurors and preserve favorable jurors. A 

trial team should prepare a jury profile for 

the trial lawyer that highlights features of 

potentially favorable and unfavorable jurors. 

Additionally, a trial team should draft 

jury questions for the questioning phase of 

jury selection. 

Third, a trial team should prepare 

motions in limine on all issues or evidence 

that the team seeks to keep from the 

jury. Likewise, a trial team should prepare 

response briefs to the opponent’s anticipated 

trial motions. Waiting for an opponent 

to present a motion is too late to begin 

preparing a response when there are so 

many other tasks to complete at the start 

of a trial. Obtain cases supporting your 

motions and your response briefs and copy 

them for the court and the opponent. 

Fourth, prepare a motion for directed 

verdict, at least in outline form and with 

case law, so that the motion is almost ready 

to present to a court as the plaintiff nears 

the close of its case. Fifth, a draft set of jury 

instructions should be ready for the trial 

lawyer’s review before a trial commences. 

This advance preparation aids a trial lawyer 

in reviewing the applicable law, the elements 

of proof and the cases pertinent to 

the disputed issues. 

Witness Tasks 

Trial groundwork also includes preparing 

and logistically handling witnesses and the 

client representatives. First, a trial team 

should prepare a witness list that contains 

the name, address and all contact information 

of every potential witness and client 

representative in a case. The judge, the 

court clerk, and the court reporter information 

also should be on that list. The goal 

is to avoid delay should you need to contact 

a client, a witness or the court. If you have 

a choice of court reporting services, coordinate 

the selection with adverse counsel 

to share the expense. Put the court reporting 

service on notice that reporters will be 

needed for the trial and give advance notice 

if real time reporting, draft transcripts or 

daily copy of transcripts will be required so 

the service can reserve sufficient reporters 

for the trial needs. 

Second, make arrangements for witness 

travel and housing. These arrangements 

extend to lay witnesses, company 

witnesses, and expert witnesses. It is essential 

that someone supervise this entire process 

and monitor that witnesses arrive in 

town as scheduled.

Third, the all-important task of preparing 

the witnesses to testify must be 

carefully implemented. Witnesses need 

books tailored to their knowledge of a 

case, books that contain documents that 

they are familiar with, and their depositions 

or statements in connection with 

the case. Complete the books so that witnesses 

can study the materials with sufficient 

time, well in advance of a trial, to 

refresh their recollection of the facts and 

prior testimony. 

Fourth, if the lead trial attorney prefers, 

abstracts of the testimony of each 

witness should be prepared and placed in 

trial notebooks for the trial team. Fifth, 

again depending on the lead trial attorney’s 

preference, lists of topics, issues, and specific 

questions that pertain to each witness 

should be prepared to aid the trial lawyer 

in focusing on the key parts of the witness’ 

testimony. 

Legal Tasks 

A trial team needs to complete particular 

legal tasks before the court deadlines 

expire. First, issue demands for supplemental 

discovery updates to opponents and 

follow up to obtain a complete set of discovery 

materials before trial. Second, prepare 

and timely file requests to produce documents 

at trial. Third, make sure that subpoenas 

for witnesses to appear at the trial 

have been served on the witnesses, as well 

as subpoenas for evidentiary documents 

to be produced at trial. If your trial team 

learns that a witness will be unavailable, 

an evidence deposition to preserve testimony 

needs to be scheduled and taken in 

advance of the trial. 

Fourth, review all pleadings for completeness. 

Your trial team must ensure that 

all the proper affirmative defenses have 

been pled, the most recent complaint has 

been fully and correctly answered, and all 

third-party complaints or counterclaims 

have been properly filed or preserved. Fifth, 

locate all physical evidence and make sure 

to maintain chain of custody so that your 

team can use the items during the trial. 

Sixth, identify and prepare all trial 

exhibits, and identify and prepare the 

foundation necessary to admit the exhibits 

into evidence. If a foundation witness 

is required for evidence to be admitted, 

either obtain from adverse counsel a stipulation 

as to the foundation requirements, 

or a request to admit. Absent cooperation 

from counsel, a witness must be secured to 

testify at trial for the admission of the evidence 

or an evidence deposition must be 

taken. Graphic exhibits may require testimony. 

Electronic evidence may require 

authentication. Photos may require verification 

on accuracy. These are only a small 

group of potential exhibits and the foundation 

requirements necessary to have exhibits 

admitted as evidence. A trial team must 

identify all evidence that it may seek to 

introduce and be prepared to lay the foundation 

to introduce it during the trial. Evidence 

preparation also includes numbering 

all exhibits and preparing a chart for counsel 

and the court with the exhibit number, 

description of the exhibit, date moved for 

admission, and ruling. 

Seventh, gather all impeachment evidence 

to use against the opponent’s witnesses. 

Search all potential sources for 

materials that may contradict the credibility 

of the witnesses or the position that they 

took during the case. These sources include 

the Internet, the witness’ personal websites, 

such as a Facebook page, if accessible, 

or a blog, the website of an expert, and the 

expert materials on file with organizations 

such as DRI and its Expert Witness Database 

(http://www.dri.org). These sources also 

can be searched for information about the 

jurors, if time permits. 

Trial Logistical Tasks 

There are always a number of logistical 

tasks that may seem trivial but are essential 

because they permit a lead trial attorney 

to smoothly present evidence during a 

trial. The key to completing these tasks is to 

tailor the preparation of these items to the 

specific preferences of the lead trial lawyer, 

organizing file materials so that he or she 

can instantly find what he or she needs during 

the course of the trial without excessive 

fumbling and searching in front of the jury. 

First, a trial team must create a case’s 

trial file. This means eliminating duplicate 

copies from the file, old correspondence, 

old motions, notices and pleadings, 

and irrelevant documents that will not be 

used during the trial. File organization 

also means creating witness folders and 

books that contain all the witness’ statements 

and depositions, documents containing 

the witness’ names or concerning 

the witnesses, and copies of any related 

documents that the lead trial attorney may 

use during the witnesses’ testimony. Second, 

attend to the courtroom logistics in 

accordance with the lead trial lawyer’s preference. 

Arrange for additional tables and 

chairs in advance of the trial date to give 

court personnel sufficient time to comply. 

If presentations will involve a projector, 

then arrangements need to be made for a 

screen, a projector, and a laptop to run the 

system, as well as to place enough monitors 

in enough locations so that the judge, jury 

and counsel in the courtroom can see the 

projected materials. A trial support company 

may need to be retained to operate 

the projection system and display exhibits 

during the trial. Depending on the court 

system, your team may need a court order 

signed in advance of the trial date to bring 

the equipment in and out of the courtroom 

each day. Your trial team members 

may need the court’s permission to bring 

a cell phone or printer to the courtroom 

for use on breaks. Search for an adequate 

power supply in advance, and improve it, 

if necessary. 

Third, make sure that the means to display 

exhibits are ready to go. If your case 

needs it, make sure that you will have a flip 

chart with fresh paper and markers. If your 

case needs it, make sure that you will have 

an easel to hold exhibits. If the lead trial 

lawyer prefers a lecturn, make arrangements 

so that a lecturn is in the courtroom. 

Finally, make sure that someone on your 

trial team notifies the law firm office staff to 

order the necessary supplies that you will 

use during the trial, and they are available 

to the team once trial preparation begins. 

Summary 

We live in a chaotic environment, and few 

events are as chaotic as the events that 

unfold shortly before and during a trial. 

Readiness for trial consists of more than 

the lead lawyer knowing the facts and strategy. 

Advance preparation of all aspects 

of a trial minimize the chance that chaos 

will rain down on your client’s case and 

adversely influence the outcome of the case. 

When confronted with last minute changes 

during a trial, an attorney can reasonably 

assume that the odds will favor the prepared 

attorney. 



Voir Dire Finesse 

By Sharon F. Bridges 

Tips to 

Capture the 

Best Jury 

It is important to 

understand the dynamics 

that drive high jury 

awards and to strike 

those potential jurors 

who would have a 

propensity to grant them. 

The right to a jury trial is embedded in the democratic culture 

of America. High-stakes litigation mandates that corporate 

defense attorneys prepare for trial as if preparing 

for war. Trials are often won or lost during voir dire. 

Depending on the venue and the judge, 

attorneys may have great latitude when 

conducting voir dire. The ability to question 

potential jurors and challenge their 

responses or qualifications is essential in 

the jury selection process. Researching the 

demographics of the community in which 

you will try a case can prove useful in creating 

themes that you can convey in voir 

dire to educate the venire on key facts beneficial 

to the defense of a case. 

It is critical to elicit responses related to 

a potential juror’s background, life experiences 

and opinions. Attorneys analyze these 

responses to determine whether a potential 

juror can be fair and impartial. Trying to 

uncover the most sympathetic juror to support 

a corporation’s position is the ultimate 

goal. Below are candid considerations by a 

corporate defense attorney that can assist 

you in the jury selection process. 

Questioning: A Game of Hide and Seek 

An experienced defense attorney recognizes 

that you have to ask the right question 

to obtain the best response from a potential 

juror. Phrasing questions properly can 

be an arduous task. In questioning, you 

should carefully consider a potential juror’s 

culture, race, age, gender, economic status, 

educational background and employment 

status. Many potential jurors who 

have never participated in the jury selection 

process may feel intimidated. A corporate 

defense attorney should endeavor 

to make the venire feel comfortable and to 

exude trustworthiness. 

Potential jurors should be encouraged to 

express their thoughts and opinions. This is 

easily accomplished by asking open-ended, 

nonthreatening questions. It is imperative 

to expose potential jurors inclined to award 

large sums of money. Phrase questions to 

prompt potential jurors with extreme views 

toward damages to respond. The questions 

below are examples that may identify 

jurors who may support high damage 

awards. 

■ Sharon F. Bridges is a partner with Brunini Grantham Grower & Hewes PLLC in Jackson, Mississippi. She practices in the 

areas of labor and employment, product liability and health care law (including medical malpractice and nursing home defense), 

representing national and local corporations. She currently serves as vice president for the National Bar Association and on the 

Advisory Board for the National Association of Women Lawyers. In addition to DRI’s Trial Tactics Committee, she is also a member 

of DRI’s Women in the Law Program Planning Subcommittee. 


• Is it more important to compensate an 

injured party than to determine who 

caused the injury 

• Do you think that damage awards in 

civil cases are too high, too low or about 

right 

• Do you believe that there should be a cap 

on damages 

The objective of the questioning process is 

to find the most plaintiff- oriented jurors 

who, as the defense, you will likely strike, 

but to hide potential jurors that the defense 

will likely select. 

A party may inquire whether a prospective 

juror would support or oppose awarding 

punitive damages in a negligence action 

if the court instructed the jury that it may 

consider punitive damages. Yazoo & M.V.R. 

Co. v. Roberts, 88 Miss. 80, 40 So. 481 (Miss. 

1906). The Mississippi Supreme Court has 

approved questions posed by a defense attorney 

to prospective jurors that provided 

information about the plaintiffs’ “contacts, 

affiliations and beliefs,” since that type of 

information “might bear on the decision 

to exercise peremptory strikes of jurors.” 

Owens v. Mississippi Farm Bureau Cas. Ins. 

Co., 910 So. 2d 1065 (Miss. 2005). A party 

may not construct hypothetical questions 

requiring a prospective juror to pledge 

a particular verdict. Rule 3.05, Uniform 

Rules of Circuit and County Court; Harris 

v. State, 532 So. 2d 602 (Miss. 1988). Harris 

v. State was cited in De La Beckwith v. 

State, 707 So. 2d 547 (Miss. 1997). The De 

La Beckwith case was a high- profile case, 

which was moved to another county in an 

attempt to obtain an untainted jury pool. 

The De La Beckwith court discussed Harris 

v. State’s prohibition against posing hypothetical 

questions to a jury during voir 

dire. The prosecutor asked prospective jurors 

if the fact that 30 years had passed since 

the crime was committed would influence 

them. The Mississippi Supreme Court found 

the question was not a hypothetical question 

within the meaning of Uniform Circuit 

and County Court Rule 5.02 and Harris v. 

State, but rather was within the court’s policy 

of allowing litigants to find out information 

regarding the jury. De La Beckwith v. 

State, 707 So. 2d 547 (Miss. 1997). 

Generally, however, voir dire examination 

questions should stick to the abstract, 

simply asking questions about the class of a 

case, not what a prospective juror might do 

in the particular case that he or she might 

hear. Nicholson v. State, 761 So. 2d 924 

(Miss. Ct. App. 2000); McCaskill v. State, 

227 So. 2d 847 (Miss. 1969). Courts have 

held that any voir dire procedure that effectively 

impairs a defendant’s ability to exercise 

peremptory challenges intelligently is 

grounds for penalty reversal, irrespective of 

prejudice. Knox v. Collins, 928 F.2d 657 (5th 

Cir. 1991), cert. denied, 510 U.S. 1061 (1994); 

Carter v. State, 869 So. 2d 1083 (Miss. Ct. 

App. 2004). 

Jury Questionnaires 

Using jury questionnaires during the 

jury selection process may be beneficial, 



depending on the facts of a case. Jury questionnaires 

facilitate the process and help 

avoid responses of members of the venire 

from potentially tainting the jury pool 

when questions deal with sensitive topics. 

In Mississippi, the use of a jury questionnaire 

is clearly within the province of the 

court. Bennett v. State, 2003-DP-00765- 

SCT (May 11, 2006). Counsel complete and 

A corporate defense 

attorney should endeavor 

to make the venire feel 

comfortable and to 

exude trustworthiness. 

review the questionnaires before beginning 

voir dire. A questionnaire’s query will vary, 

depending on the facts of a case. In product 

liability cases, questionnaires should 

phrase questions to elicit knowledge of the 

products at issue and whether the venire 

members have used them. For example, 

• Have you or a member of your family 

ever purchased/used product A 

• Have you or a member of your family 

ever been injured by using product A 

• Have you read or heard anything about 

lawsuits related to product A 

Affirmative responses to the above questions 

should support your request to the 

judge to question individuals separately, 

away from the venire. 

In nursing home cases, questionnaires 

should include questions geared toward 

ascertaining prospective jurors’ knowledge 

about the defendant nursing home, including 

whether relatives or close friends 

have been residents of a facility, whether 

panelists have visited a facility and if they 

have opinions about a facility, and if so, 

what they are. Sample questions include: 

• Do you know anyone who has been a resident 

in nursing home A 

• Do you believe that nursing homes provide 

good care, average care or poor care 

to residents 

• Do you believe that most nursing homes 

are adequately staffed 


You will need to ask additional, follow-up 

questions when you question individuals 

separately, away from the venire, to flesh 

out the substance of a prospective juror’s 

perspective. It is imperative to explore 

prospective juror biases regarding nursing 

homes to support excluding jurors with 

biases for cause. Otherwise, you may select 

a juror with strong negative opinions about 

the defendant nursing home. 

In highly publicized cases, the questionnaire 

should include questions to 

determine the extent of a potential juror’s 

knowledge of the facts of the case. In some 

jurisdictions, too much knowledge about 

the facts of a case will justify a challenge for 

cause. When used properly, jury questionnaires 

can make the jury selection process 

more effective and expeditious. Id. 

Challenges for Cause 

A corporate defense attorney should utilize 

challenges for cause to eliminate unwanted 

jurors. In Mississippi, the Uniform Rule 

for Circuit and County Court 4.05 adopts 

the traditional method for exercising challenges. 

Rule 4.05, Uniform Rules for Circuit 

and County Court; see also Thorson v. State, 

895 So. 2d 85 (Miss. 2004) (correct procedure). 

When a potential juror has a bias 

that is so strong that he or she cannot overcome 

it, the juror should not be allowed to 

serve on the jury. On the other hand, when 

a prospective juror has voiced an opinion 

seemingly prejudicial to the defense, 

but, after further inquiry, frequently called 

“rehabilitation,” the juror demonstrates 

ability and willingness to decide a case 

impartially according to the law and evidence, 

a challenge for cause is not warranted. 

State v. Eugene, 871 So. 2d 584 (5th 

Cir. 2004). A court considers all challenges 

for cause before the parties are permitted 

to exercise peremptory challenges. 

A skillful corporate defense attorney’s 

efforts to unclothe biases during voir dire 

will support challenges for cause. It is the 

judge’s responsibility to ensure that the jury 

selected is fair and impartial. Scott v. Ball, 

595 So. 2d 848 (Miss. 1992); Davis v. Powell, 

781 So. 2d 912 (Miss. Ct. App. 2000). 

An attorney may seek to remove a juror for 

cause if a challenge against him or her exists 

that would likely affect his or her competency 

at trial. Billiot v. State, 454 So. 2d 

445 (Miss. 1984); De La Beckwith v. State, 

707 So. 2d 547 (Miss. 1997) (citing Billiot 

v. State, 454 So. 2d 445 (Miss. 1984)). A juror’s 

ability to be fair and impartial is considered 

impaired if, because of his or her 

relationship with one of the parties, occupation, 

past experiences or any other reason, 

the juror would normally lean in favor of 

one party. See Taylor v. State, 656 So. 2d 104 

(Miss. 1995) (court should have dismissed 

brother of assistant district attorney); Scott 

v. Ball, 595 So. 2d 848 (Miss. 1992) (articulating 

standard); Ortman v. Cain, 811 So. 

2d 457 (Miss. Ct. App. 2002). 

The defense attorney need not show 

additionally that forcing it to accept the 

challenged juror would injure his or her client. 

Bernard v. Richoux, 464 So. 2d 856 (5th 

Cir. 1985). However, it has been held that a 

party generally cannot obtain relief for the 

erroneous sustaining of a challenge to a 

juror for cause. U.S. v. Gonzalez- Balderas, 

11 F.3d 1218 (5th Cir. 1994). 

In Heaney v. Hewes, 8 So. 3d 221 (Miss. 

Ct. App. 2008), the court found that a 

patient in a medical malpractice case was 

not denied an impartial jury when, during 

voir dire, the trial court declined to 

dismiss for cause all potential jurors who 

had prior direct or indirect contact with 

the defendant doctors. Sixteen members 

of a 53- person venire had prior professional 

contact with the defendants. Both defendants 

were retired at time of trial, preventing 

any risk that members of the venire 

would be influenced by possibility of future 

treatment by the defendants. The patient’s 

attorney only challenged two specifically 

named members of the venire for cause on 

the basis of prior contacts with the defendants, 

and neither of the specifically challenged 

jurors sat on jury. 

It is not uncommon in small-town venues 

in Mississippi for members of the 

venire to have familial relationships with 

the parties or their attorneys. However, this 

relationship alone may not sufficiently support 

a challenge for cause. For instance, in 

Davis v. State, 743 So. 2d 326 (Miss. 1999), 

the court discussed the rule regarding 

familial relationships among parties, key 

witnesses and prospective jurors, and held 

that the civil law rule governs the computation 

of relationships. The court found 

that a fourth- degree kinship was outside 

the range that mandated a strike for cause. 

Best Jury, continued on page 84


Lessons from 

The Godfather 

By Daniel E. Cummins 

Universal 

Principles and 

Practical Advice 

Attorneys should make 

efforts to deal with each 

other in an objective and 

professional manner 

without descending 

into personal animosity 

and attacks. 

Few movies are as revered or have reached such iconic status 

in American culture as the movies that make up The 

Godfather trilogy. Obviously, the great acting by many 

incredible actors in these films plays a major part in 

achieving that status. But perhaps even 

more appealing is the writing behind the 

film, which has generated many lines that 

cannot only be considered quotable quotes 

but also, in a broader sense, universal principles 

of life. These universal principles are 

applicable to all walks of life, from the mob 

underworld to our noblest of professions, 

and they can provide practical instruction 

to all who are open to such advice. An 

application of some universal principles 

as enunciated by the great characters of 

The Godfather trilogy to the practice of law 

offers some sound advice and instruction. 

“It’s not personal Sonny. 

It’s strictly business.” 

Michael Corleone to Sonny 

Corleone in The Godfather 

There may be nothing more important to 

the practice of law than the principle that 

decisions should never be motivated by 

personal or emotional animus, but rather, 

should always involve a sound, objective, 

businesslike decisionmaking process. All 

too often, attorneys take the actions and 

adverse positions of opposing counsel personally 

and retaliate without first thinking 

through and formulating an appropriate 

response on an objective basis and in accordance 

with the law and facts of cases. 

The practice of law has unfortunately 

deteriorated to the absurd and reprehensible 

extent that formal written rules of civility 

are apparently required in an effort to 

maintain order between counsel. One reason 

that written rules may have become 

necessary for attorneys is that counsel 

are indeed ethically required to zealously 

advocate for their clients’ causes of action, 

which, in turn, can unfortunately invite 

emotions and personal animosity into 

the decisionmaking process and in dealings 

with opposing counsel. The key, of 

course, is to rise above personal issues and 

emotions and handle matters in a strictly 

businesslike manner. 

Litigating attorneys should also never 

take on the emotional trappings of their 

clients and should never let their personal 

■ Daniel E. Cummins is an insurance defense/coverage attorney with the Scranton, Pennsylvania, law firm of Foley, Cognetti, 

Comerford, Cimini & Cummins. His blog, Tort Talk, provides updates about Pennsylvania civil litigation and insurance law issues 

(http://www.torttalk.com/). A version of this article previously appeared in the August 29, 2005, edition of Pennsylvania Law 

Weekly. 



opinions of opposing counsel or the quality 

of opponents’ cases impede an objective 

application of the law to the facts of cases. 

In the big picture, attorneys are the representatives 

of their respective clients, and 

those clients generally are engaged in disputes 

that they cannot resolve amicably. An 

attorney cannot properly and professionally 

evaluate the pros and cons of a case if 

Litigating attorneys 

should also never take on 

the emotional trappings 

of their clients. 

his or her judgment is clouded by emotionally 

charged and negative feelings toward 

another attorney, that attorney’s client, or 

that attorney’s case or argument. Accordingly, 

if you find yourself unable to separate 

yourself from an emotional opinion of 

the case, it may be wise to run the case by 

another attorney, or even better a lay person, 

for a fresh and objective viewpoint. 

It is particularly important to remain 

objective when evaluating cases for settlement 

purposes and in engaging in settlement 

negotiations. Emotions have no 

place during settlement negotiations, but 

they can run high and frustrate an objective 

evaluation of a case’s range of value. 

Ultimately, in all cases, it’s not personal. 

It’s strictly business. 

“Never hate your enemies— 

it affects your judgment” 

Michael to Vincent Mancini in 

The Godfather, Part III 

A corollary to the general rule that negative 

emotions have no place in the litigation 

process is that an attorney should 

never allow matters with the opposition to 

become personal. When someone allows 

his or her emotions to intrude into their 

dealings with opposing counsel, the ability 

to evaluate any and all issues that arise 

becomes clouded by feelings. 

As difficult as it may be, an attorney must 

attempt to disassociate and remove negative 

feelings or animosity, even when warranted, 


toward opposing counsel, an opposing client, 

a judge, or whomever that attorney is 

dealing with. Only then can an attorney 

properly evaluate or handle an issue. 

Although sometimes easier said than 

done, an attorney should not allow an emotional 

viewpoint to cloud an evaluation of 

case issues. This is not to say that an attorney 

should not be passionate or should refrain 

from forcefully presenting his or her 

position on the case at hand. The key, rather, 

is to attempt to keep emotional responses, 

whether positive or negative, from clouding 

your judgment. After all, remember what 

happened to Sonny Corleone in The Godfather 

when he allowed his emotions to cloud 

his judgment and to best him. 

“Keep your friends close, but 

your enemies closer” 

Michael to Frankie Pentangeli 

in The Godfather, Part II 

No advice may be as difficult to heed than to 

keep your enemies or adversaries close. Unfortunately, 

some adversaries practicing the 

law thrive on petty confrontation and routinely 

take matters to a personal, negative, 

and vexatious level. Those attorneys seem to 

enjoy attempting to push the buttons of opposing 

counsel and disrupting the normally 

smooth handling of cases. While boorish 

behavior has no place in the practice of law, 

usually you have no recourse against it. So, 

you must develop skills to deal with those 

attorneys effectively. 

One way to deal with “enemies,” or all 

hostile adversaries for that matter, is to keep 

them close. And one way to keep them close 

is to know the facts and law of cases better 

than they do. Excellent resources for quickly 

grasping the law when a case is referred to 

you is by a review of the issue presented as 

analyzed by a jurisdiction-specific practice 

guide or legal encyclopedia. (In the author’s 

home state, for example, the Pennsylvania 

Law Encyclopedia or in Stephen Feldman’s 

The Pennsylvania Trial Guide. You may also 

find cases on point with your case in the 

more specific Negligence Instant Case Finder 

by Glenn A. Troutman. Furthermore, in automobile 

accident and insurance litigation, 

someone can quickly secure an understanding 

of the applicable law from a review of 

Milford Meyer’s Pennsylvania Vehicle Negligence 

and J. Ronca et al.’s Pennsylvania 

Motor Vehicle Insurance 2d. In terms of the 

Rules of Civil Procedure and related forms, 

there are no better resources than Goodrich- 

Amram 2d: Procedural Rules Service With 

Forms and Dunlap- Hannah Pennsylvania 

Forms.) 

It is important to remember as well that 

a case can only move forward by keeping 

opposing counsel close with continued 

communication. As aggravating as opposing 

counsel may become in such dealings, 

it never fails to remain in control of your 

own emotions and hit an opponent with 

kindness, good humor, and rational explanations 

supporting your position. Always 

confirm everything in writing with these 

types of attorneys as a further method to 

keep them under control. Again, a positive 

way to view a difficult situation with a difficult 

opponent is to remember that each 

communication will move the parties one 

step closer to the eventual resolution of the 

case, at which point you will no longer have 

to deal with that attorney or that matter. 

“Fredo, you’re my older brother 

and I love you. But don’t ever 

take sides, with anyone, against 

the family again. Ever.” 

Michael to Fredo Corleone in The Godfather 

The Rules of Professional Conduct require 

counsel to put a client’s interests above all 

others in accordance with the law. As an 

attorney, you should never take actions or 

positions detrimental to the interests of a 

client unless, of course, you are ethically 

required to do so. Additionally, although 

an opposing case or client may be sympathetic, 

an attorney is ethically bound to put 

such emotions aside and to evaluate a case 

on an objective basis in the best interests of 

his or her own client. By expressing doubt 

or exhibiting a lack of confidence in a client’s 

theory of a case or argument, an attorney 

can damage a case, at times fatally. 

One consequential benefit of an unwavering 

loyalty, confidence, and belief in your 

client and his or her cause of action is the 

increased credibility for you and the case 

in the eyes of opposing counsel, the judge, 

and the jury. If an attorney does not publicly 

and convincingly exhibit his or her 

own belief in a client’s case, no one else will. 

Raising and explaining away any weaknesses 

in a case, as opposed to attempting 

to hide or ignore them, will also enhance 

both your and the case’s credibility.

Furthermore, part of fully representing 

your own client is placing yourself in the 

shoes of opposing counsel and immersing 

yourself in the facts of the case and the 

theory of the case from the other side’s perspective. 

Unless and until you do so, you 

cannot fully appreciate the strengths and 

weaknesses of your own case. 

Accordingly, when preparing your client 

for a deposition or trial testimony, 

you should submit the client to a possible 

cross- examination in an effort to prepare 

him or her for the same. While preparing 

for oral argument, first prepare the 

argument for your own client, and then 

compose the argument for the opposition. 

Only by doing both can you identify and 

address the problems and weak points in 

your own argument. Additionally, during 

your oral argument, or during your closing 

argument during a trial, it is wise to 

end your argument by advising the judge of 

the opposing arguments that you anticipate 

that your opponent will make, and then 

explaining to the judge or jury why such 

arguments should be rejected. You will 

raise your credibility by showing that you 

are not steadfastly and blindly presenting 

only your side of the case, but rather presenting 

both sides of the case and attempting 

to convince the judge or jury why your 

client’s position is the fair and just position. 

“I’m gonna make him an 

offer he can’t refuse.” 

Don Corleone to Johnny 

Fontaine in The Godfather 

In terms of settlement negotiations, you 

cannot sell something to someone that he or 

she does not want to buy. When negotiating 

with opposing counsel, again, put yourself 

in the position of that opposing counsel or 

client and attempt to frame settlement offers 

in the best light from that perspective. 

For example, you can emphasize the 

value of settling a case early, as opposed 

to after many months of litigation, or after 

awaiting an opening in a court’s schedule 

for a settlement conference or trial. You can 

raise the benefit of settling soon, in terms 

of interest on the settlement money, or the 

effect on the potential for delay damages. 

If the parties are engaged in a nonbinding 

mediation and have reached an impasse, 

perhaps offering to pay for the mediator’s 

services can spark further discussions 

leading to an ultimate resolution. By 

thinking of settlement from the other party’s 

perspective and being creative and positive 

in framing your settlement offers, you 

may effectuate a settlement of a case within 

the range of value. 

In trying to settle a case, attorneys will 

want to remember that emotions have no 

place in negotiations. If at all possible, 

check all emotions generated by a case 

or your interactions with the opposition 

before beginning settlement negotiations. 

Both parties should attempt to participate 

in settlement discussions in the most objective 

and businesslike manner possible. 

Attorneys should also take steps to control 

their clients and attempt to convince 

them to also put their emotions aside and 

to view a case—and the attorneys’ advice 

about the value of a case—in a businesslike 

manner. You should establish your 

client’s reasonable and fair settlement position 

before commencing negotiations. Further, 

if you are not able to reach a resolution 

on your terms, the parties should simply 

move on to the next step in the litigation 

process. One way or another, a case will 

inevitably conclude at some point. 

“I have always believed helping your 

fellow man is profitable in every 

sense, personally and bottom line.” 

Michael to reporters in The 

Godfather, Part III 

Although Michael Corleone may have 

issued this statement with a sense of irony, 

helping your fellow man is, indeed, profitable 

in every sense. In addition to assisting 

all of our clients with their legal matters, an 

attorney may also profit on a personal level 

by taking on a pro bono case within the 

scope of his or her expertise whenever possible. 

Obviously, handling a pro bono case 

is not only viewed favorably by all, but it is 

also personally gratifying. Equally gratifying 

is the participation in and completion 

of volunteer activities in the community. 

The Godfather, continued on page 86 

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From the Committee 

Growth and Alliances 

By Robert J. Torralbo 

and Christopher G. Campbell 

Keep in mind the 

many opportunities 

our fast-growing 

group has to offer. 


■ Robert J. Torralbo is a partner and the head of the litigation group in the Montréal, Quebec, office of Blake, 

Cassels & Graydon LLP, where he practices corporate commercial litigation and arbitration with an emphasis 

on defending class actions, product liability, securities, banking, real estate and shareholder disputes. He 

is the chair of DRI’s International Law Committee. Christopher G. Campbell is a partner in DLA Piper’s global 

litigation practice, in the firm’s Atlanta office. He focuses in the areas of mass tort, product liability and commercial 

litigation. Mr. Campbell is the publications chair of DRI’s International Law Committee.

Create Opportunities 

For two years in a row now, 

we at the DRI International 

Law Committee are honored 

to have a feature spot 

in For The Defense. We 

have a strong slate of articles 

for you again this year. But, 

before getting to that, let us 

say a word or two about the committee 

itself. 

Opportunities abound! The International 

Law Committee continues to be 

one of DRI’s fastest growing committees, 

and our unique alliance with DRI Europe 

has only strengthened that position. More 

importantly, however, are the opportunities 

for leadership, responsibility, and 

speaking or writing that exist in this committee. 

First, there are the leadership positions. 

The International Law Committee is 

large, but any individuals who are interested 

in taking a leadership role (and rolling 

up their sleeves to do a little work) 

would find themselves welcome. Second, 

there are speaking opportunities. Every 

year, the International Law Committee puts 

on a two- to three- person presentation at 

DRI’s Annual Meeting. Anyone interested 

in speaking at next year’s program should 

stop by the committee’s business meeting, 

Friday, October 22, during this year’s 

DRI Annual Meeting in San Diego. Lastly, 

there are plenty of writing opportunities. 

In addition to full-length articles like those 

that appear in this month’s issue, the International 

Law Committee also sponsors the 

“Think Globally” column, edited by Chris 

Campbell, that appears each month in For 

The Defense. Reach out to Chris if you are 

interested in getting something in print. 

Now for the articles. This year, we have 

four articles that should be of tremendous 

interest and value for you. Dr. Truiken J. 

Heydn of teclegal Habel Rechtsanwaelte 

Partnerschaft in Munich, Germany, has 

written an article to give readers a look 

at continental Europe’s perspective of 

crossborder tort claims involving Internet 

publications. Asa W. Markel of Shorall 

McGoldrick Brinkmann wrote on the use 

of summary judgment (or its procedural 

equivalent) in international litigation. 

David E. Dukes, Eric A. Paine, and Heyward 

D. Bonyata of Nelson Mullins Riley 

& Scarborough submit their article on the 

protection of privacy in international data 

transfers. Last but not least, Richard A. 

Sheinis and Chad A. Wingate of Hall Booth 

Smith & Slover have written on defenses to 

the enforcement of international arbitration 

awards in the United States. 

The International Law Committee leadership 

includes Robert J. Torralbo (committee 

chair), Frank J. Ciano (committee 

vice chair), John J. McDonough (board 

liaison), Christopher G. Campbell (publications 

chair), Francisco J. Colón- Pagán, 

Sr. (subcommittee chair, Latin America), 

Sandra L. Corbett (liaison, Partnering with 

Industry Groups Task Force), Christopher 

Scott D’Angelo (steering committee), Richard 

N. Sheinis (program chair), and Kevin 

Mescall (membership chair). We also note 

a special thanks to Bob Allen, who helped 

get this committee off the ground. 

On behalf of all of us and the full membership, 

thank you to DRI for this opportunity 

and thanks to you for your interest. 

As you are paging through this month’s 

issue, please keep the opportunities at the 

International Law Committee in mind, and 

please come see us in San Diego in the fall. 



Summary Judgment in 

International Litigation 

By Asa William Markel 

A Local 

Solution to 

a Global Issue 

On the global, strategic 

level, counsel needs 

to be aware of the 

jurisdictions where 

summary judgment or 

its equivalent is available, 

and how to obtain it. 

■ Asa William Markel is an associate with the Phoenix office of Shorall 

McGoldrick Brinkmann, practicing complex civil litigation and advising clients 

on crossborder and import/export matters. He is admitted to practice 

in Arizona and California, and as a solicitor (currently non- practicing) in England 

and Wales. 


As international business dealings have become more 

commonplace, the need to solve the problem of parallel litigation—lawsuits 

in more than one place over the same 

dispute—has only grown. The anti-suit injunction, by 

which common law judges have stopped 

foreign lawsuits before they can really 

begin, by enjoining defendants from filing 

suit elsewhere, has been the darling of 

international litigation commentators in 

recent years. Similarly, comparative law 

scholars have devoted a great deal of ink 

to the split among federal courts in the 

United States concerning whether a civil 

action should be dismissed under the lis 

alibi pendens doctrine because the same 

dispute is pending before a foreign court. 

These devices, often pioneered by English 

judges in London, have been sold to American 

litigators as a panacea for clients’ concerns 

over parallel litigation in multiple 

countries. However, as subjects of scholarly 

debate, they are popular precisely because 

courts continue to disagree about their 

application. Thus, when the court in which 

your client wants to litigate has not agreed 

with you that all lawsuits elsewhere should 

be halted or dismissed by an injunction 

because your court, and no other courts 

hearing the same dispute have agreed to 

dismiss those parallel suits, the race to 

judgment will begin. For this reason, a litigator 

wishing to provide strategic counsel 

to a client always should remember the 

tried and true: summary judgment. When 

the various courts hearing the same dispute 

in multiple jurisdictions will not terminate 

any of the lawsuits on technical or 

procedural grounds, the only recourse is to 

proceed as quickly as possible to the merits, 

in the forum of your client’s choice. 

The race to judgment begins when there 

are multiple, parallel lawsuits between the 

same parties concerning the same dispute. 

The reason for the race is that the first case 

to reach judgment may preclusively affect 

the cases that have not reached judgment. 

E.g., Sea Containers Ltd. v. Stena AB, 890 

F.2d 1205, 1213 (D.C. Cir. 1989). The notion 

of judgment preclusion (e.g., res judicata or 

non bis in idem) is fairly universal in civil 

litigation in most countries. See Case No. 

07-13512, 2008 Bull. Civ. I, No. 168 (Fr.) 

(discussing “autorité de la chose jugée”); 

Judgment of Jun. 12, 1998, 52 Minshu 1147 

(Japan 1998) (discussing res judicata or 

“kihanryoku”); and Vervaeke (formerly 

Messina) v. Smith, [1982] 2 All E.R. 144, 151 

(U.K.H.L.) (per Lord Halisham) (discussing 

estoppel per rem judicatam in relation to

foreign judgments). Nearly all legal systems 

should allow an attorney to raise preclusion 

as a defense in a motion, without the need 

for trial. See, e.g., N.C.P.C., arts. 122–23 (Fr.) 

(“plea of inadmissibility” or “la fin de nonrecevoir” 

may be raised at any time). Thus, 

the first party to obtain a judgment can 

expect to use that judgment so that it will 

have some positive effect in other pending 

proceedings dealing with the same dispute. 

Summary judgment is one of the surest 

methods of obtaining judgment on the 

merits without a trial. 

American litigators rely quite heavily 

on motions for summary judgment. 

However, the same lawyers are generally 

unaware that they can use summary judgment 

motions in jurisdictions outside of 

the United States. This is ironic, as the summary 

judgment procedure was an English 

invention, meant to give plaintiffs in routine 

promissory note enforcement actions 

a detour around expensive trials on the 

merits. See Summary Procedure on Bills 

of Exchange Act 1855 (18 and 19 Vict., c. 

67) (Eng.). Courts and litigants were quite 

happy with the new procedural detour, and 

over the years, summary judgment became 

available in ever-more kinds of civil actions 

in England. Some litigators now practicing 

in the United States may be surprised 

to learn that summary judgment became 

available in federal and most state courts 

only with the adoption of the Federal Rules 

of Civil Procedure in 1938. Federal and 

state court decisions in the United States as 

late as the 1940s continued to show judicial 

confusion regarding this “new” motion. 

The fact that summary judgment was 

not invented in the United States may be 

one of its greatest strengths as a tool in 

international litigation. On the global, strategic 

level, counsel will need to become 

aware of the jurisdictions in which summary 

judgment or its equivalent is available, 

and the particulars of obtaining it. 

The salient questions to consider at the outset 

include, when is summary judgment 

authorized, what evidence can a party permissibly 

use in summary judgment proceedings, 

and who ultimately will hear a 

request for summary judgment 

Summary Judgment Standards 

Within the United States, the summary 

judgment standard is largely unified. In 

federal courts, and in the majority of 

states where the Federal Rules of Civil 

Procedure have been adapted to local 

practice, summary judgment is permitted 

on any claim, defense, or issue when 

“there is no genuine dispute as to material 

fact.” Fed. R. Civ. P. 56(a). The ultimate 

issue is whether a matter requires 

a decision on the facts, which requires a 

trial, or whether the facts are undisputed 

so that the judge can apply the law and 

enter a judgment without a trial. California 

and New York, the largest commercial 

jurisdictions in the country, have adopted 

their own rules for civil procedure. However, 

their summary judgment standards 

are in line with the federal standard. In 

California, summary judgment is authorized 

when “it is contended that the action 

has no merit or that there is no defense to 

the action or proceeding.” Cal. Civ. Proc. 

Code §437c(a). On its face, the California 

language would appear to open the 

door to a different standard, however, the 

same statute provides that a court is to 

grant summary judgment only “if all the 

papers submitted show that there is no triable 

issue as to any material fact and that 

the moving party is entitled to a judgment 

as a matter of law.” Cal. Civ. Proc. Code 

§437c(c). In other words, the federal and 

California standards are quite similar, 

allowing judgment as a matter of law only 

when no fact issue requiring trial remains. 

Similarly, New York courts are permitted 

to enter summary judgment based on 

a showing of entitlement to judgment as a 

matter of law, but they must deny summary 

judgment “if any party shall show facts sufficient 

to require trial of any issue of fact.” 

N.Y. C.P.L.R. 3212(b). New York courts have 

required the complete absence of material 

issues of fact. Alvarez v. Prospect Hosp., 68 

N.Y.2d 320, 324 (N.Y. 1986). In line with 

federal and other state courts, New York 

courts have required this, no matter how 

weak the evidence supporting the dispute. 

Ayotte v. Gervasio, 81 N.Y.2d 1062, 

1063 (N.Y. 1993). Thus, a party requesting 

summary judgment will always have 

the burden of demonstrating the absence 

of a factual dispute. This is a universal 

requirement common to all United States 

jurisdictions. 

In English courts, the Civil Procedure 

Rules 1998 permit applications for summary 

judgment on claims and defenses. 

For litigants in England, the term “interim 

application” takes the place of the American 

phrase “pretrial motion.” To grant a 

summary judgment application, an English 

court must conclude, “(a) (i) that claimant 

has no real prospect of succeeding on 

the claim or issue; or (ii) that defendant has 

no real prospect of successfully defending 

the claim or issue; and (b) there is no other 

compelling reason why the case or issue 

should be disposed of at a trial.” C.P.R. 

24.2(a) and (b) (Eng.) (emphasis added). 

Thus, the English test requires “no real 

prospect” of success and “no other compelling 

reason” for a trial. Unfortunately 

for the outside observer, in perhaps the 

most famous exposition on the current 

English summary judgment standard, the 

then- senior judge of the English Court of 

Appeal’s Civil Division, known as the Master 

of the Rolls, wrote that the standard of 

“no real prospect of succeeding” required 

no further elucidation or amplification. 

Swain v. Hillman, [2000] 1 All E.R. 91 (Eng. 

C.A.) (per Lord Woolf, MR). Fortunately, 

a more recent decision has held that for a 

trial judge to grant summary judgment, 

the facts must not be in dispute, and the 

court should be certain that all of the relevant 

facts are before it. S. v. Gloucestershire 

County Council, [2001] 2 W.L.R. 909 

(Eng. C.A.). 

What all this means is that counsel 

should consider the prospects for summary 

judgment as soon as a client becomes or 

may become involved in multiple lawsuits 

about the same dispute. The goal in summary 

judgment proceedings generally will 

always be the same: to establish that there 

is no triable issue of fact. The applicable 

substantive law in each case may vary, but 

the need to avoid factual disputes will not. 

Procedural Considerations 

The procedural requirements for summary 

judgment requests of foreign courts, 

whether they are called “motions” or 

“applications,” will often bear similarities 

to U.S. requirements. Litigants in 

the United States requesting or contesting 

summary judgment can rely on affidavits, 

or sworn declarations to demonstrate 

that fact issues exist. Fed. R. Civ. P. Rule 

56(e); Cal. Civ. Proc. Code §437c(b)(1) 

and (2); and N.Y. C.P.L.R. 3212(b). Simi- 



larly, litigants in English courts may rely 

on written evidence, including the sworn 

statements of witnesses. C.P.R. 24.5 (Eng.). 

However, while American lawyers quite 

frequently attach deposition transcripts 

to pretrial motions, bear in mind that 

depositions are not as commonplace in 

other countries as they are in the United 

States. English courts, for example, will 

not even compel depositions in support of 

U.S. proceedings simply for the purpose 

of conducting discovery. First Am. Corp. 

v. Zayed, [1999] 1 W.L.R. 1154, 1165 (Eng. 

C.A.) (per Sir Richard Scott, VC). Thus, if 

counsel intends to depose witnesses before 

seeking summary judgment, the United 

States remains the best forum for wideopen, 

pretrial discovery, including obtaining 

depositions. 

On a global level, the party that wishes 

to obtain a judgment on the merits first 

would prepare sworn witness statements 

to request summary judgment in the forum 

with the law deemed most favorable to 

that party. When one or more of the proceedings 

are pending in the United States, 

a party may also use the U.S. courts’ liberal 

approach to depositions, thereby procuring 

deposition transcripts for use in a 

summary judgment motion. Deposition 

transcripts advantageously corroborate a 

party’s own witness statements and declarations 

with the sworn testimony of the 

opponent. Once gathered, witness statements 

and deposition transcripts can then 

be used to support a request for summary 

judgment in any number of jurisdictions 

that offer such relief. 

Summary Judgment Outside the Box 

Summary judgment has evolved in many 

jurisdictions. Prior to 1998, English courts 

relied on the standards provided in Order 

14 of the Rules of the Supreme Court, also 

called “O. 14.” Under the older version of 

the rule, only a party requesting affirmative 

relief could obtain summary judgment. 

This is still the case in Scotland. Ct. 

Sess. R., ch. 21 (Scot.) (motions for “summary 

decree”). Moreover, it is still the case 

in many other English- speaking jurisdictions, 

such as Hong Kong and Singapore, 

both major commercial litigation centers 

in Asia. R. H. Ct., Ord. 14 (H.K.); and Sing. 

R. Ct., Ord. 14. Indeed, the popularity of 

limiting summary judgment to requests by 


affirmative claimants remains quite strong 

throughout the Commonwealth, a voluntary 

association of 54 countries with historical 

roots in the British Empire. See, e.g., 

Fed. Ct. R., Ord. 20 (Austl.). The practical 

effect of this for a lawyer providing strategic 

advice to a client facing litigation in 

multiple countries is that as a defendant, 

the client will need to use counterclaims 

creatively. For example, if a client’s counterclaim 

establishes facts necessary to refute 

an opposing claim, the resulting summary 

judgment may not only foreclose continued 

litigation in that forum, but in all related 

suits in other countries. 

Outside of the Commonwealth, American 

lawyers will find very few courts offering 

summary judgment relief. The civil 

law countries outside the English- speaking 

world have enacted statutes to provide for 

“summary” procedures. See, e.g., N.C.P.C., 

art. 484 (Fr.); and Shin Minji Sosho Ho 

(New Civil Procedure Code), No. 109/1996, 

art. 270 et seq. (Japan). However, these 

procedures are designed for decisions on 

provisional remedies requests, or for abbreviated 

trials on the merits. Usually, a civil 

law country will not have a specific procedure 

for avoiding trial and obtaining judgment 

as a matter of law based on a lack 

of factual dispute. As with common law 

courts, interlocutory decisions issued by 

judges in civil law countries do not have 

preclusive effect. See, e.g., N.C.P.C., art. 

482 (Fr.); and Shin Minji Sosho Ho (New 

Civil Procedure Code), No. 109/1996, art. 

245 (Japan). However, a judge in a civil law 

country generally does have the option of 

proceeding to trial on a particular matter 

and entering partial, final judgment, 

which will have a preclusive effect. See, 

e.g., N.C.P.C., art. 480 (Fr.); and Shin Minji 

Sosho Ho (New Civil Procedure Code), No. 

109/1996, art. 243(2) (Japan). 

Civil law courts have been quite famous 

for allowing trials on affidavits. Thus, in 

many respects, many civil law jurisdictions 

will conclude trial on the same basis as 

common law courts determine summary 

judgment motions: on the papers. This is 

all the more reason to approach global litigation 

strategy with the common law summary 

judgment procedure in mind so that a 

party’s written evidence has been gathered 

at an early stage in proceedings with a view 

to precluding continued litigation in other 

fora. However, even if live examination 

of witnesses is called for in proceedings 

before a judge in a civil law country, the 

judge usually has great flexibility in determining 

the times set for trial and the issues 

to be decided at each stage. Although there 

has been some movement in recent years 

for civil law courts to adopt approaches 

more akin to those in common law countries, 

including a single, continuous trial, 

civil law courts still often have the ability 

to decide issues through separate, discrete, 

mini-trials. If a common law jurisdiction is 

unavailable for obtaining a summary judgment, 

counsel may nonetheless be able to 

creatively use the civil law approach to trial 

to obtain a ruling that could preclude parallel 

litigation elsewhere. 

Systemic Impediments to 

the Global Approach 

A client cannot always win the race to judgment 

in its forum of choice, or indeed, in 

any single forum at all. One nagging area 

that generally prevents judgment preclusion 

in foreign courts is intellectual property. 

Intellectual property is generally a 

creature of statute. An intellectual property 

right will exist only to the extent that a 

territory or state recognizes the intellectual 

property right at issue. As a consequence, 

a foreign judgment concerning intellectual 

property is generally worthless in another 

lawsuit, even in disputes between the same 

parties about the same device, invention, 

work, or mark. E.g., Medtronic, Inc. v. Daig 

Corp., 789 F.2d 903, 907–08 (Fed. Cir. 1986). 

Additionally, countries with courts that 

follow the English civil procedure rules 

will often preclude summary judgment in 

matters concerning admiralty, fraud, slander, 

or libel. See R.S.C., Ord. 14 (pre-1998 

English rule). Obviously, using summary 

judgment will prove ineffectual in framing 

a global litigation approach in these matters 

when a party can most quickly obtain 

summary judgment in a jurisdiction with 

the traditional exceptions to the summary 

judgment rule. 

It is also worth noting that the prospect 

of filing a second action against the same 

party within the European Union (EU) has 

been foreclosed by legislation. Under the 

Jurisdiction Regulation, EC No. 44/2001, 

the European Union forbids a second court 

within the EU from hearing the same case

as one previously filed in an EU court. The 

grant of exclusive jurisdiction has been 

extended to all countries of the European 

Economic Area (EEA) through the Lugano 

Convention. The grant of exclusive jurisdiction 

to the court “first-seized” of the matter 

within the EU is so absolute that another 

EU court cannot enjoin the first suit even 

if it has been commenced in contravention 

of an express agreement to arbitrate in the 

second jurisdiction. Case C-185/07, Allianz, 

SpA v. West Tankers Inc., [2009] All E.R. 

(D) 82 (European Court of Justice). Thus, 

parallel litigation generally has been outlawed 

within the EU. Consequently, if a first 

action was commenced in a hostile forum 

that was not part of the parties’ exclusive 

jurisdiction agreement, a party must file 

a second suit outside the EU seeking relief 

from the first action. A party can no longer 

obtain redress from an English court, 

as was historically the case. 

Conclusion 

In this article we have suggested that if a 

client faces the reality or possibility of litigation 

in multiple jurisdictions, when possible, 

counsel should use the common law 

summary judgment procedure to frame 

overall litigation strategy because of the 

preclusive effect of judgments. It is useful 

not only in crossborder disputes, but 

also sometimes in litigation commenced 

in more than one state or province within 

the same country. This approach necessitates 

that procedural objections to some or 

all of the parallel lawsuits have been overruled, 

leaving courts only to deal with the 

merits of the claims advanced in unwanted 

fora. This strategy has little or no application 

to parallel intellectual property disputes, 

which courts must decide separately, 

in each country where intellectual property 

rights allegedly exist. Yet, for most matters, 

a judgment obtained through summary 

judgment is still a judgment, and it 

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The Continental 

European Perspective 

By Truiken J. Heydn 

Cross Border 

Tort Claims and 

the Internet 

To avoid uncomfortable 

and costly litigation 

in a foreign country, 

Internet website content 

providers should use 

reasonable care when 

deciding what to publish. 

■ Truiken J. Heydn is a partner at teclegal Habel Rechtsanwaelte Partnerschaft, 

Munich, Germany. She specializes in litigation, arbitration, mediation 

and conflict management with a focus on technology- related disputes such 

as product liability and disputes relating to IT and the Internet. Ms. Heydn is 

a member of DRI Europe and of DRI’s International Law Committee. 


Publish something on the Internet and you may find yourself 

in court as defendant—anywhere in the world. This 

happened to the publisher of the New York Times. On 

June 12, 2001, the New York Times published an article 

about an investigation initiated by the city 

of New York related to a bribery case in 

Ukraine. In that article, the plaintiff, a resident 

of Germany, was mentioned by name 

and called a gold bootlegger and a delinquent 

who had committed misappropriation, 

and whose German company was 

affiliated with Russian organized crime, according 

to reports of American and German 

criminal prosecution authorities. It was further 

alleged that the plaintiff had been enjoined 

from entering the United States. The 

article was published in the print edition 

and online on the same day. The plaintiff 

sued the publisher of the New York Times 

for defamation, or, as it is called in German 

legal language, “Verletzung des Persönlichkeitsrechts,” 

violation of personal rights, in 

the District Court of Düsseldorf, Germany. 

The publisher of the New York Times argued 

that the District Court of Düsseldorf had 

no jurisdiction. Both the district court and 

the court of appeals dismissed the claim 

for lack of jurisdiction. However, on further 

appeal, the German Federal Supreme 

Court, Bundesgerichtshof (BGH), decided 

that German courts had international jurisdiction 

over the case. Bundesgerichtshof 

[BGH] [Federal Supreme Court], judgment 

of Mar. 2, 2010, File No. VI ZR 23/09, http:// 

juris.bundesgerichtshof.de/cgi-bin/rechtsprechung/ 

document.pyGericht=bgh&Art=en&sid=3591ebf3 

9da3cce5af0abc7d94940d8c&nr=51433&pos=0& 

anz=1. The judgment only addressed the jurisdiction 

of German courts. It did not consider 

the merits of the case, so it did not 

address whether the allegations in the article 

in fact constituted a violation of personal 

rights. Rather, the Bundesgerichtshof 

remanded the case to the Court of Appeals 

of Düsseldorf, which will determine the 

merits of the case. 

The Statutory Basis 

The relevant rule that German courts apply 

when determining jurisdiction in crossborder 

tort claims involving non- European 

Union countries is Sec. 32 of the German 

Code of Civil Procedure. In the New York 

Times case mentioned above, both the court 

of appeals and the German Federal Supreme 

Court based their rulings on Sec. 32 of the 

German Code of Civil Procedure, but they 

interpreted the statute differently. Sec. 32 of 

the German Code of Civil Procedure applies

to both local jurisdiction within Germany 

in domestic cases and to international jurisdiction 

in crossborder cases. It reads in 

English as follows: “§32 Special Jurisdiction 

of Torts. The court in whose circuit a tort 

is committed has jurisdiction over claims 

based on such tort.” (Unofficial translation 

by the author.) For crossborder tort claims 

within the European Union (EU), there is a 

similar provision in Article 5, Para. 3 of European 

Regulation No. 44/2001. It provides 

that, in tort matters, the courts of the place 

where a harmful event occurred, or may occur, 

have jurisdiction. 

So far so good—at first this seems simple. 

But as is often the case with statutes, in 

particular in a civil law system, the devil is 

in the details. If someone violates another’s 

rights by writing an article, where has 

the tort been committed, or where has the 

harmful event occurred Where the writer 

actually wrote the article Where the writer 

lives, or where the publisher of the article 

resides Or was the tort committed where 

someone purchased the paper in which 

the article appeared Even in the offline 

world these questions are not easy to answer. 

And they become more complicated 

in the online world. Has the tort been committed 

where the article has been uploaded, 

or where the server hosting the article has 

been physically located Then, what about 

the proxy servers that facilitate the data flow 

through the Internet, caching data, making 

transitional copies so that many people simultaneously 

can access them Is the tort 

committed anywhere such transitional copies 

are located Finally, is the tort committed 

anywhere the article has actually been 

accessed through the Internet, or even anywhere 

Internet access exists and someone 

could potentially access the article 

Where Has the Tort Been Committed 

With respect to offline cases, the Bundesgerichtshof 

has held that a tort has been committed 

in terms of Sec. 32 of the German 

Code of Civil Procedure both at the place 

of performance and the place of effect. As 

a consequence, in cases concerning the violation 

of personal rights through print 

media, a plaintiff may choose to file a suit 

where the publisher resides, or where the 

paper is regularly distributed. Bundesgerichtshof 

[BGH], judgment of May 3, 1977, File 

No. VI ZR 24/75, NJW 1977, p. 1590 et seq. 

Obviously, in the New York Times case, 

in which the suit was filed in Germany because 

the article was accessible over the Internet 

in Germany, only the place of effect 

was relevant. The place of performance, or 

publication, in this case, was in the United 

States. In its 2010 judgment in the New 

York Times case, the Bundesgerichtshof, 

however, pointed out that print media case 

law cannot be transferred to Internet tort 

claims. The court argued that Internet content 

is not “distributed” but rather made 

available or held ready for access, referring 

to Sec. 7, Para. 1 of the German Telemedia 

Act, which uses the phrase “hold ready for 

use” to describe information offered by Internet 

service providers. The court further 

argued that unlike print media, it is very 

difficult to determine a locally confined distribution 

territory of a website. 

The General Principles: Mere 

Accessibility Versus Target Group 

With regard to tort claims in online cases, 

the opinions in the case law so far in Germany 

vary broadly. In particular, they vary 

depending on the area of law that is involved. 

For the purpose of jurisdiction, claims arising 

from many different areas of law qualify 

as “tort,” such as infringement of intellectual 

property rights, violation of competition 

laws, defamation, and infringement of 

rights with regard to protected business interests, 

to list a few. While some German legal 

authorities had advanced the view that a 

tort is committed anywhere Internet access 

exists and anywhere someone could potentially 

access an article, others advanced the 

position that the website also must target 

German Internet users. 

The first case decided by the Bundesgerichtshof 

about jurisdiction for tort claims 

and the Internet concerned trademark 

infringement. Bundesgerichtshof [BGH], 

judgment of Oct. 13, 2004, File No. I ZR 

163/02, http://juris.bundesgerichtshof.de/cgi-bin/ 

rechtsprechung/document.pyGericht=bgh&Art= 

en&sid=31f03a9043d8dedffb8d86d160900c34& 

nr=31708&pos=0&anz=1. The Bundesgerichtshof 

did not decide where a tort occurred, 

but stated, obiter dictum, that limiting 

jurisdiction to venues where a collision of 

interests occurred had a lot that was commendable. 

This opinion took an intermediary 

stance between the two positions 

outlined above, which are that either a tort 

is committed anywhere Internet access 

exists and anywhere someone could potentially 

access an article, or that a website also 

must target German Internet users. 

The second Bundesgerichtshof case was 

decided by the same division of the court, 

but this time, it involved violation of unfair 

competition laws. Bundesgerichtshof 

[BGH], judgment of Mar. 30, 2006, File No. 

If mere accessibility were 

sufficient, the result would 

be shoreless, jurisdictional 

expansion, which would 

counter the guiding 

principles of jurisdiction. 

I ZR 24/03, http://juris.bundesgerichtshof.de/cgibin/rechtsprechung/document.pyGericht=bgh&Ar 

t=en&sid=838d7f60aabc8065ba121ec4849943d 

3&nr=36030&pos=0&anz=1. In that case, the 

Bundesgerichtshof decided that German 

courts had jurisdiction because the website 

was addressed to German consumers, as it 

was available in the German language and 

also, prices were stated in deutsche marks. 

While the website contained a disclaimer 

stating that deliveries would be made to 

“German- speaking Europeans, but not to 

German addresses,” the court considered 

the disclaimer irrelevant because, in fact, 

deliveries had been received by addressees 

in Germany—contrary to the language of 

the disclaimer. 

In the New York Times case the Bundesgerichtshof 

cited two cases decided by the 

District Court of Paris, France, Tribunal 

de Grande Instance de Paris, which considered 

the number of times a website has 

actually been accessed to be the relevant 

criterion under Article 5, Para. 3 of European 

Regulation No. 44/2001. Tribunal de 

Grande Instance de Paris, Ordonnance du 

Juge de la Mise en Etat, issued Apr. 27, 2009, 

17. Ch. Presse- Civile, Nr. Rg. 08/15331, and 

Ordonnance du Juge de la Mise en Etat, 

issued July 6, 2009, 17. Ch. Presse- Civile, Nr. 

Rg. 08/15331. 



The New York Times case stands out 

from the other two Bundesgerichtshof 

cases in that it is particularly detailed, 

and it is the first case involving a violation 

of personal rights. In the New York Times 

case, the Bundesgerichtshof followed an 

intermediary path. The Bundesgerichtshof 

held that viewing mere accessibility 

as sufficient to establish jurisdiction contradicted 

the purpose of Sec. 32 of the German 

Code of Civil Procedure because this 

provision created an exception to the general 

principle requiring a plaintiff to file an 

action where the defendant was located, 

or actor sequitur forum rei. This exception 

was justified by the specific relationship 

of an Internet- related dispute to the 

place of performance or the place of effect. 

However, the specific relationship of a dispute 

to a particular forum was not established 

by the accessibility of the violating 

content over the Internet because generally, 

the accessibility of a website exists in 

every country, due to the basic, technical 

conditions. On this basis, the court argued 

that if mere accessibility were sufficient, 

the result would be shoreless, jurisdictional 

expansion, which would counter the guiding 

principles of jurisdiction, the purpose 

of which is to avoid venues with low-grade 

connections to a dispute, to reduce concurring 

jurisdiction and to make potential 

jurisdiction predictable and controllable. 

To achieve these goals, the court held that 

a connection with Germany was necessary, 

not simply the violating content’s mere 

accessibility in Germany. In cases of violation 

of personal rights, such connection, 

however, does not require that the objectionable 

website “target” German users. 

The court held that while such criterion is 

justified for market- related torts, such as 

violations of unfair competition laws, it is 

unsuitable to limit the otherwise existing 

multitude of venues in cases of violations of 

personal rights, because a violation of personal 

rights does not require an impact on 

a market, but occurs independently from 

the intentions of the violator once a third 

party takes note of the violating content. 

The court also rejected the number of 

times a website has actually been accessed 

as the criterion to determine jurisdiction. 

At least for cease- and- desist claims, this is 

only one indication of, but has no further 

relevance to, determining the necessary 


domestic relationship. It is not always possible 

to determine an actual number, and 

a plaintiff, who bears the burden of proof, 

will not have access to this information, 

due to data protection laws. Furthermore, 

the court pointed out that cease- and- desist 

claims deal with the future, and they do 

not require that a violation has taken place 

in the past. 

Rather, the court determined that the 

clash of interests was the relevant criterion 

to determine jurisdiction, in that the plaintiff’s 

interest to have his or her personal 

rights respected, on the one hand, could 

clash with the defendant’s interest in freedom 

of reporting, on the other hand, given 

the circumstances of this particular case, 

and the content of the objectionable report. 

The court further explained that clashing 

interests would become much more likely 

if the article had been noticed inland, due 

to the circumstances of the particular case, 

than would have been the case if the article 

were merely accessible. If noticed in Germany, 

it would affect the plaintiff’s personal 

rights in Germany. This reasoning 

has been criticized to be a circular argument. 

Case Comment by Degmair, Kommunikation 

& Recht, 2010, p. 343. 

In support of the opinion that the clash 

of interests should be the relevant criterion 

to determine jurisdiction, the court, inter 

alia, cited a judgment by the High Court 

of Australia of December 10, 2002. Dow 

Jones and Company Inc. v. Gutnick (2002) 

HCA 56; 210 CLR 575; 194 ALR 433; 77 

ALJR 255, http://www.austlii.edu.au/au/cases/ 

cth/HCA/2002/56.html. 

The Application of Principles 

in the New York Times Case 

In applying these principles in the New 

York Times case, the Bundesgerichtshof 

explained that the plaintiff lived and did 

business in Germany, the plaintiff’s name 

was mentioned in the article, and the allegations 

contained in the article had a clear 

connection with Germany. The article 

referred to reports of German criminal 

prosecution authorities and to a company 

owned by the plaintiff, which was located 

in Germany, and which, according to the 

article, allegedly had connections with the 

Russian mafia. On that basis, the court 

concluded that it was likely that German 

Internet users would notice the article with 

interest, and that in Germany, people will 

or would take note of the article. 

Moreover, the court argued that the 

New York Times is and was an internationally 

acknowledged newspaper that targets 

a worldwide market. The online edition is 

and was accessible in Germany, and Germany 

is explicitly listed in the registration 

area of the online portal as a “country 

of residence.” At the relevant time, in June 

2001, 14,484 Internet users were registered 

who had declared Germany to be their 

country of residence. 

In addition, the court held that it was 

irrelevant that the article was placed in the 

Metro section of the online edition, the socalled 

“Metropolitan Desk,” because the 

article could not be compared to articles 

in the online edition of a local newspaper 

or a city magazine with predominantly 

local contents, which typically targets the 

respective region. The court argued that 

the article showed that it was written in 

Washington, and that the article obviously 

did not deal with a local event, but with 

activities of substantial international interest, 

namely the bribery of Eastern European 

public officials to boost someone’s 

own business interests. In that context, 

the court further argued that readers of an 

online edition, unlike readers of the paper 

edition, could identify contents of interest 

to them by using the search function, for 

example by entering the word “Germany” 

into the paper’s online- search function. 

Finally, the court held that it was irrelevant 

that there were only 14,484 persons 

in Germany who could have taken note 

of the article, because prominence was 

not a requirement of international jurisdiction, 

and because the plaintiff’s social 

esteem could be affected substantially even 

if only one person in his social environment 

noticed the harmful allegations. 

However, the judgment did not reveal 

whether only the 14,484 registered users 

or also other users could access the article. 

Also, the language issue was not addressed 

at all by the court. Obviously, the New 

York Times article was written in the English 

language. The court apparently simply 

assumed that at least the 14,484 registered 

users understood the English language, 

because otherwise they would not have 

registered. While in the case of the English 

language, someone may argue that most

Internet users understand English because 

it is the lingua franca of the Internet, language 

may be much more relevant and lead 

to decisions denying jurisdiction in Internet 

cases involving other languages. 

the statutory attorneys’ fees of the winning 

party based on the value in dispute. 

The first bad news is that, with respect 

to violations of personal rights, and possibly 

other tort claims, such as trademark 

infringements, the Bundesgerichtshof 

tends to assume that German courts have 

jurisdiction, to a great extent. The second 

bad news is that the criteria established in 

Cross Border, continued on page 90 

The Future: A European Court 

of Justice Decision 

The Bundesgerichtshof has submitted a 

case involving a personal rights violation 

on the Internet to the European Court of 

Justice (ECJ) asking the ECJ to clarify the 

interpretation of Article 5 Para. 3 of the 

European Regulation No. 44/2001 and the 

relevant criteria. Bundesgerichtshof [BGH], 

decision of Nov. 10, 2009, File No. VI ZR 

217/08, http://juris.bundesgerichtshof.de/cgi-bin/ 

rechtsprechung/document.pyGericht=bgh&Art= 

en&sid=766a2fbf56c1d0045af3a55d417c03e9&n 

r=50137&pos=0&anz=1. The upcoming ECJ 

decision will hopefully provide some guidance 

regarding the relevant criteria for 

determining jurisdiction for tort claims in 

crossborder Internet cases, and probably 

also will have some influence on the interpretation 

of the national laws, under which 

courts determine jurisdiction in crossborder 

cases involving non-EU countries. 

Conclusion 

The case law established by the Bundesgerichtshof 

related to jurisdiction for torts 

committed over the Internet is anything 

but helpful. There are at least two different 

standards, one for violations of unfair competition 

laws, and another for violations of 

personal rights, with the latter probably 

also relevant in trademark infringement 

cases. More and different standards for 

torts committed over the Internet in other 

areas of law may develop in the future, in 

particular, if decided by yet another division 

of the Bundesgerichtshof. 

The first good news is that litigation 

based on violations of German unfair competition 

laws, which are, by the way, quite 

strict, can be avoided through a disclaimer, 

which must be combined with actual practices 

that make sure that no content is delivered 

to customers located in Germany. 

The second good news is that litigation in 

Germany and in continental Europe may 

be more desirable for defendants than in 

other parts of the world. Defendants will 

not face jury trials, discovery, punitive damages, 

or contingency fees. And the loser pays 

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representing clients in high-risk litigation, 

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hptylaw.com 

For The Defense September 2010 67 

n n


Don’t Click “Send” 

Until You Read This 

By David E. Dukes, 

Eric A. Paine 

and Heyward D. Bonyata 

While still being 

defined, a clear, working 

knowledge of EU data 

protection laws, and best 

practices for avoiding 

their breach, is necessary. 

Protection of Privacy 

in International 

Data Transfers 

European privacy laws present challenges to multinational 

companies responding to discovery that calls for the production 

of personal data about European citizens. European 

concepts of privacy and the protections that 

European Union (EU) law provides are 

extremely broad by American standards. 

European law bans the export of personal 

data to countries that do not provide adequate 

protection and, to complicate matters 

further, the EU considers U.S. data 

protection laws and privacy principles 

inadequate. 

The Directive 

In 1995, the EU adopted European Council 

Directive 95/46, Protection of Individuals 

with Regard to the Processing of Personal 

Data and on the Free Movement of Such 

Data, 1995 O.J. (L 281) 31, 38 (EC). The primary 

objective of the Directive is to “protect 

the fundamental rights and freedoms 

of natural persons, and in particular their 

right to privacy with respect to the processing 

of personal data.” Council Directive 

95/46/EC, Article 1(1). The Directive is 

based on several specific principles, which 

specify that personal data must be 

(a) processed fairly and lawfully; 

(b) collected only for specified, explicit 

and legitimate purposes and not further 

processed in a way incompatible 

with these purposes; 

(c) adequate, relevant and not excessive in 

relation to the purposes for which they 

are collected and/or further processed; 

(d) accurate and, where necessary, kept 

up to date; 

(e) kept in a form which permits identification 

of data subjects for no longer 

than is necessary for the purpose for 

which the data were collected or for 

which they are further processed. 

Council Directive 95/46/EC, Article 6(1) 

(emphasis added). 

Each EU member state was required 

to enact national data protection legisla- 

■ David E. Dukes is the managing partner, Eric A. Paine is a partner, and Heyward D. Bonyata is 

an associate of Nelson Mullins Riley & Scarborough LLP in Columbia, South Carolina. Mr. 

Dukes practices in the areas of pharmaceutical and medical device litigation, business litigation, 

technology law and litigation, and coordination of national litigation. Mr. Paine 

practices in the areas of pharmaceutical and medical device product liability and business 

litigation. Ms. Bonyata practices in the areas of electronic discovery and pharmaceutical 

and medical device litigation. All three are members of DRI, with Mr. Dukes having served 

as the organization’s president in 2005–2006. 


tion and to create a national regulatory 

administration. For instance, the United 

Kingdom adopted the Data Protection 

Act of 1998 and established the Information 

Commissioner’s Office to oversee and 

enforce the act’s provisions, as well as to 

liaise with the European Commission’s 

administrative and advisory bodies. Therefore, 

while the Directive’s principles are 

uniform, their interpretation and implementation 

varies from country to country. 

For the current status of EU member 

states’ implementing legislation, see http:// 

www.ec.europa.eu/justice_home. 

The Directive also established the Article 

29 Data Protection Working Party, an 

advisory panel composed of a representative 

of each member state’s supervisory 

authority and a representative of the European 

Commission. The Article 29 Data 

Protection Working Party issues opinions 

on the adequacy of protection in the EU 

and “third” countries, which are not binding 

but are considered persuasive. Application 

of the Directive depends on several 

core concepts, particularly “personal data,” 

“data processing,” and “data transfer.” 

Personal Data 

The Directive explicitly defines “personal 

data” as “any information relating to an identified 

or identifiable natural person (‘data 

subject’).” Council Directive 95/46/EC, at 48. 

In short, every individual is a “data subject.” 

Personal data includes such obvious examples 

as name, address, telephone number, 

Social Security number (for U.S. residents), 

and account numbers. However, personal 

data also includes voice recordings, still 

photographs, video surveillance, biometric 

information, and written or other hardcopy 

materials “relating to an identified or 

identifiable person.” It encompasses subjective 

information, such as political opinions, 

statements about reputation, and an individual’s 

social behavior or status. Article 29 

Data Protection Working Party Opinion 136, 

at 6. Under the Directive, sensitive personal 

data concerning race and ethnicity, health, 

sexual preferences, union membership, and 

political, religious or philosophical beliefs 

cannot be processed at all unless within the 

narrow confines of specifically enumerated 

exceptions. See Council Directive 95/46/EC, 

Article 8(1) (“derogations”). 

As defined in Article 2 of the Directive, an 

“identifiable person” is “one who can be identified, 

directly or indirectly, in particular by 

reference to an identification number or to 

one or more factors specific to his physical, 

physiological, mental, economic, cultural or 

social identity.” Council Directive 95/46/EC, 

at 38. The concept of the “identifiable person” 

is nebulous, but its reach is pervasive. 

In Data Protection Technical Guidance: 

Determining what is personal data (Aug. 

16, 2007), the UK’s Information Commissioner’s 

Office recommends that, when in 

doubt, treat information as “personal data.” 

Under the guidance, appropriate protection 

requires the “data controller,” discussed below, 

to consider “all the means likely reasonably 

to be used” to identify the data subject, 

including “’means that are likely to be used 

by a determined person with a particular 

reason to want to identify individuals,’ such 

as investigative journalists, estranged partners, 

stalkers and industrial spies.” 

Data Controllers and Data Processors 

Under the Directive, data processing 

includes “any operation or set of operations 

which is performed upon personal 

data, whether or not by automatic means, 

such as collection, recording, organization, 

storage, adaptation or alteration, retrieval, 

consultation, use, disclosure by transmission, 

dissemination or otherwise making 

available, alignment or combination, 

blocking, erasure, or destruction.” Council 

Directive 95/46/EC, at 38. The concept 

technically encompasses mundane activities, 

such as copying an electronic file to a 

flash drive (recording or storage), opening 

a .pdf image (retrieval or consultation), or 

preparing a memorandum summarizing 

a meeting (collection, recording, storage, 

adaptation, use, and dissemination). 

The individual or entity in possession of 

personal data is regarded as a “data controller.” 

In short, a data controller decides 

how and why data will be processed. If 

data is processed in one of the EU’s member 

states, the data controller must adhere 

to the member state’s data protection law. 

Non- European entities or persons possessing 

personal data are also considered data 

controllers. Data controllers have regulatory 

duties, including implementing technical 

and administrative measures to prevent unauthorized 

access to or loss of personal data, 

registering with national data protection 

authorities, maintaining data processing 

operations registries, and prior notification 

of the national authorities before engaging 

in processing operations. See, e.g., Council 

Directive 95/46/EC at Articles 17, 18, and 21. 

“Data processors” are individuals or entities 

engaged by data controllers to process 

data. Each processor must adhere to 

the data protection laws of the state where 

the individual resides or where the entity 

is established, even if the individual whose 

personal data is being processed is from 

somewhere else. In the strictest sense, a 

data processor is a subcontractor of the data 

controller and may have some protection 

from liability for unauthorized processing 

or transfer of personal data if processing or 

transfer has been completed according to 

the data controller’s requirements. An entity 

possessing personal data may be both a 

data controller and a data processor. 

The general rule is that companies 

located in the EU may only collect personal 

data needed to fulfill “specified, explicit and 

legitimate purposes and not further [process 

it] in a way incompatible with those 

purposes.” Council Directive 95/46/EC, at 

40. The Directive only allows processing of 

personal data if processing is “necessary” 

or a data subject has “unambiguously given 

his consent.” Id. Retaining and reviewing 

business records revealing personal 

data for litigation has been determined a 

secondary use, which would thus either 

require the consent of a data subject or processing 

necessity. See Fred H. Cate & Margaret 

P. Eisenhauer, Between a Rock and a 

Hard Place: The Conflict Between European 

Data Protection Laws and U.S. Civil Litigation 

Document Production Requirements, 

6 Privacy & Security L. Rep. 2 (BNA, 

Inc. 2007). The Directive defines consent 

as “any freely given specific and informed 

indication of [the data subject’s] wishes by 

which the data subject signifies his agreement 

to personal data relating to him being 

processed.” Council Directive 95/46/EC, at 

39. The Article 29 Data Protection Working 

Party has not agreed that “compliance with 

extra- territorial legal requirements is ‘necessary’ 

to justify processing of employee 

data in Europe.” Cate & Eisenhauer, at 3. 

Rights, Remedies, Enforcement, 

and Penalties 

Council Directive 95/46/EC provides spe- 



cific rights to individual data subjects. 

First, each data subject is entitled to notification 

whenever a data controller collects 

his or her personal data, including 

notification of the data controller’s identity, 

purposes of the processing, and information 

about the recipients of subsequent 

data transfers. Second, each data subject is 

entitled to access to his or her personal data 

The Directive only allows 

processing of personal 

data if processing is 

“necessary” or a data 

subject has “unambiguously 

given his consent.” 

possessed by any data controller. The data 

controller must provide the data in readable 

format and disclose the source of the 

data. Third, a data subject is entitled to have 

inaccurate or out-of-date information corrected 

and to have third parties to whom 

erroneous data has been transferred notified 

of the corrections. Fourth, a data subject 

is entitled to contest decisions based 

on inaccurate data, or to an explanation of 

the rationale underlying decisions based 

on personal data, such as the rationale for 

a loan application rejection. 

Individuals may also pursue claims for 

monetary compensation for data breaches 

and inappropriately disclosed personal 

data. Normally, an individual would initiate 

a claim under the relevant member state’s 

national data protection law. However, in 

the absence of that remedy, an individual 

may seek redress in the European Court of 

Human Rights under Article 8 of the European 

Convention on Human Rights. 

Article 28 of Council Directive 95/46/ 

EC requires that each member state monitor 

compliance with the Directive. National 

data protection authorities have the power 

to hear complaints by data subjects, investigate 

data processing and transfer activities, 

and pursue enforcement. National 

data protection authorities have the power 


to address violations through civil fines 

and, in some instances, criminal penalties. 

The Directive does not include criminal 

penalties; however, a member state’s 

implementing legislation may criminalize 

unauthorized data processing or transfer. 

Data Transfer 

Transferring data among businesses and 

governmental entities in EU- member states 

is freely permitted. However, even if a 

company lawfully processes personal data, 

restrictions apply to transferring this data 

from the EU elsewhere. 

The phrase “transfer [of personal data] to 

a third country” is not defined by the Directive, 

but has been interpreted in the courts. 

For instance, the European Court of Justice 

has considered whether posting personal 

data to an Internet page constituted a 

“transfer to a third country.” In re Lindqvist, 

[2004] Q.B. 1014, 1035–38. Ms. Lindqvist 

was convicted under Swedish law for posting 

information about her fellow parishioners, 

including names, telephone numbers, 

and family circumstances, to the Internet, 

without their consent, and without notifying 

Swedish data protection authorities. The 

information was stored with a European Internet 

host, but it was accessible to any Internet 

user. Sweden maintained that merely 

making protected personal data accessible 

to third countries constituted a transfer. 

However, the European Court of Justice 

held that merely posting personal data to an 

Internet page did not constitute a “transfer 

to a third country.” After Lindqvist, the 

concept of “transfer” remains unclear, but 

it seems to require some sort of a push in 

the direction of a third country. 

The Directive prohibits “the transfer to 

a third country… [unless] the third country 

in question ensures an adequate level 

of protection.” Council Directive 95/46/ 

EC, at 45. Although several federal statutes 

address informational privacy, “neither the 

U.S. Constitution nor any of the current 

federal statutes establish privacy as a fundamental 

right.” Patricia Mell, A Hitchhiker’s 

Guide to Trans- Border Data Exchanges 

Between EU Member States and the United 

States Under the European Union Directive 

on the Protection of Personal Information, 

9 Pace Int’l L. Rev. 147, 163 (1997). See 

U.S. Dep’t of Commerce, Safe Harbor Overview, 

Export.gov, http://www.export.gov/safeharbor/; 

then follow “Safe Harbor Overview”. 

According to the EU, the United States does 

not ensure adequate protection, and transferring 

personal data to the United States is 

prohibited. Cate & Eisenhauer, at 4. 

Fortunately, companies have a number 

of ways to retrieve data from Europe 

without violating the directive. Transferring 

data to the United States, or another 

country with inadequate data protection 

safeguards, is lawful if the intended recipient 

(1) operates under a “safe harbor” 

provision, (2) has contractual obligations 

containing adequate data protection provisions, 

(3) has binding corporate rules, or 

(4) is subject to a specific derogation under 

the directive. 

Safe Harbor Principles 

The EU and the U.S. Department of Commerce 

(DOC) have an agreement that permits 

export of protected data to the United 

States under a “safe harbor framework,” 

which embodies requirements similar to 

those in the Directive. To join the safe 

harbor list, an eligible organization must 

notify the DOC and certify that it has 

adopted privacy policies that comply with 

seven principles. The seven safe harbor 

principles are notice, choice, access, security, 

enforcement, onward transfer, and 

data integrity. U.S. Dep’t of Commerce, Safe 

Harbor Overview, Export.gov, http://www. 

export.gov/safeharbor/; then follow “Safe Harbor 

Overview,” (last visited July 27, 2010,). 

The safe harbor agreement does have 

some limitations. First, only organizations 

that fall under the Federal Trade Commission 

or Department of Transportation can 

become safe harbor subscribers. Second, the 

safe harbor principles only apply to transfers 

between the United States and the EU. 

Third, limitations on the use and distribution 

of data remain even after the data 

leaves Europe, making further transfer of 

information to third parties, for example, 

producing documents and electronic data 

in litigation, difficult. 

The “onward transfer” principle requires 

an organization “[t]o disclose information 

to a third party, organizations must apply 

the notice and choice principles.” Id. A safe 

harbor subscriber must notify a data subject 

about an upcoming transfer and give 

the data subject the chance to opt-out of the 

onward transfer.

In litigation, a safe harbor subscriber 

could transfer personal data to its outside 

counsel if it first ascertained that counsel 

“subscribes to the Principles or is subject 

to the Directive or another adequacy finding 

or enters into a written agreement… 

requiring that [counsel] provide at least the 

same level of privacy protection.” See U.S. 

Dep’t Commerce, Safe Harbor Privacy Principles, 

(July 21, 2000), Export.gov, http:// 

www.export.gov/safeharbor/eg_main_018247.asp 

(last visited July 27, 2010). After that, to 

produce the data in litigation, the parties 

and the proposed transferee should agree 

formally to adhere to the same level of privacy 

guarantees as established by Council 

Directive 95/46/EC for the data, perhaps 

through a confidentiality order. 

Standard Contractual Clauses 

Another method for transferring personal 

data from the EU to the United States 

is to use EU- approved standard contractual 

clauses. The current iteration of the 

standard contractual clauses, “Set II,” 

became effective in 2005, and this set 

eliminated several points of contention in 

“Set I.” Rather than Set I’s joint and several 

liability provision, Set II instead provides 

that “[e]ach party shall be liable to 

data subjects for damages it causes by any 

breach of third party rights under these 

clauses.” Commission Decision 2004/915, 

2004 O.J. (L 385) 74–84, 79 (EC). Set II 

requires a data exporter to ascertain that 

the importer can comply with the contract. 

An aggrieved data subject must first 

request that the exporter enforce the contract 

against the importer. If the exporter 

fails to act promptly, the data subject 

may then seek enforcement against the 

importer. Claims asserted by a data subject 

will be adjudicated in the country where 

the data exporter is located. 

The standard contractual clauses found 

in Commission Decision 2004/915/EC 

must be used “as is” and cannot be modified. 

However, organizations are free to add 

other provisions as long as they do not contradict 

the standard contract clauses. 

Approved contracts allow personal data 

transfers to any location. The contracts also 

provide mechanisms for processing compliance 

following transfers. Options for 

onward transfer of data by a data importer 

include redaction of personal data, obtaining 

the consent of the data subject, or 

entering a similar contract with intended 

recipients to provide the same level of protection 

as specified in the contract between 

the original exporter and data importer. 

Binding Corporate Rules 

A company may also use binding corporate 

rules, which set forth an enterprise- wide 

privacy policy, to facilitate data transfer 

in compliance with EU law. The Article 

29 Working Party has established content 

requirements for binding corporate rules. 

Article 29 Working Party, Working Document: 

Transfers of Personal Data to Third 

Countries: Applying Article 26(2) of the EU 

Data Protection Directive to Binding Corporate 

Rules of International Data Transfers, 

11639/02/EN WP 74 (June 3, 2003). The 

International Chamber of Commerce (ICC) 

also provides guidance on the drafting and 

substance of binding corporate rules. ICC 

Task Force on Privacy and Protection of 

Personal Data, ICC Report on Binding Corporate 

Rules for International Transfers of 

Personal Data, Doc. 373-22/115 (Oct. 28, 

2004). Binding corporate rules must meet 

legal requirements, but they must also 

meet an entity’s unique business needs. Id. 

While no standard- form binding corporate 

rules have been developed, all binding corporate 

rules should share some common 

elements. See Article 29 Working Party, 

Model Checklist: Application for approval 

of Binding Corporate Rules, (Nov. 25, 2004) 

(WP 102) (providing a checklist). 

An organization must have draft binding 

corporate rules approved by the appropriate 

data protection authority in a European 

affiliate’s country. Following initial 

approval, the other EU member states’ 

national data protection authorities also 

must approve the rules. 

Binding corporate rules are appealing 

because they decrease the effort needed to 

legitimize data transfers and provide significant 

flexibility. They allow companies 

to freely transfer data from their European 

offices to their offices in the United States 

while allowing a significant degree of selfregulation. 

See Keith Ecker, Transfer Troubles: 

U.S. Companies Turn to New Tool to 

Comply with EU’s Data Protection Laws, 

Inside Counsel (Sept. 2007). 

However, binding corporate rules do 

not facilitate onward transfers. Therefore, 

even if a corporate defendant in the 

United States has binding corporate rules 

that allow it to receive protected data, the 

company still cannot produce the data in 

discovery until it takes further steps to 

adequately protect the data. To comply 

with the relevant EU data protection laws 

at that point, a company must rely on safe 

harbor provisions, or sign an agreement 

containing appropriate standard, contractual 

clause with opposing counsel. Failing 

that, the producing party may redact all 

personal data about identified or identifiable 

persons, also called “anonymizing,” 

or obtain consent from the data subjects. 

Derogations 

Article 26 of Council Directive 95/46/EC 

contains “derogations,” or exceptions, to 

the restrictions on the transfer of data to 

countries that do not offer adequate protection. 

The exceptions described in more 

detail below could apply to litigation in the 

United States. However, authority on this 

issue is limited, and EU regulators tend to 

construe derogations strictly. 

The “Legal Obligations” Derogation 

One of the exceptions to the restriction on 

data transfer applies when “the transfer 

is necessary or legally required… for the 

establishment, exercise or defence of legal 

claims.” Council Directive 95/46/EC, at 46. 

This exception appears to provide organizations 

a means to lawfully produce data 

in the United States. However, interpretations 

of this derogation have emphasized 

that data transfers should be (1) limited in 

scope, and (2) reactive, not anticipatory. 

The Article 29 Working Party took a narrow 

view of this derogation in this opinion: 

[T]he parent company of a multinational 

group, established in a third country, 

might be sued by an employee of 

the group currently posted to one of its 

European subsidiaries. The exception 

in Article 26(1)(d) appears to allow the 

company to legally request the European 

subsidiary to transfer certain data relating 

to the employee if these data are necessary 

for its defense. In any event, this 

exception cannot be used to justify the 

transfer of all the employee files to the 

group’s parent company on the grounds 

of the possibility that such legal proceedings 

might be brought one day. 



Article 29 Working Party, Working Document 

on a Common Interpretation of Article 

26(1) of Directive 95/46/EC of 24 October 

1995, 15 (Nov. 25, 2005). 

In addition, the Article 29 Working Party 

limited the application of this exception to 

proceedings in which “the provisions of 

the Hague Conventions of 18 March 1970 

(‘Taking of Evidence’ Convention) and of 

According to the EU, 

the United States does 

not ensure adequate 

protection, and transferring 

personal data to the United 

States is prohibited. 

25 October 1980 (‘Access to Justice’ Convention)” 

have been observed. Because the 

United States is “not a signatory to the Access 

to Justice Convention and U.S. law does 

not require courts to follow the procedures 

of the Taking of Evidence Convention,” the 

exception in Article 26(1)(d) may not apply. 

Cate & Eisenhauer, at 5. 

This exception certainly appears applicable 

in the discovery context; however, no 

case law in the United States or EU appears 

to discuss this exception. One commentator 

has stated, “When a specific document 

is legally required for the purpose of litigation 

abroad, it will fall under this exception. 

A wholesale transfer of information, 

however, may not be considered necessary.” 

Todd J. Burke, E- Discovery and Privilege: A 

Comparative Analysis, 241 N.J. Law. 15, 18 

(2006). This interpretation also appears to 

comply with the Article 29 Working Party’s 

opinion above. 

The “Consent” Derogation 

A second exception to the data transfer 

restriction that may apply to discovery 

occurs when “the data subject has given 

his consent unambiguously to the proposed 

transfer.” Council Directive 95/46/ 

EC, at 46. The general rule is that if a company 

obtains voluntary and unambiguous 


informed consent to a privacy policy that 

clearly identifies the foreign data transfer 

and the country to which the data will 

be sent, the consent is sufficient to allow 

the transfer. See Francoise Gilbert, How 

to Legally Transfer Personal Data from the 

European Union, 865 PLI/Pat. 545, 560 

(2006). A company’s privacy policy should 

be easy to read, stating that personal data 

might or will be sent from the EU to a country 

that may not provide adequate protection. 

In speaking in terms of privacy 

policies, the available authority suggests 

that an attorney could obtain valid consent 

prospectively: that is, it is not necessary to 

obtain each data subject’s consent each and 

every time a data transfer is contemplated. 

European Data Protection and 

Discovery in U.S. Courts 

Foreign and multinational organizations 

often store potentially relevant documents 

and electronic data outside the United 

States. However, compliance with the Federal 

Rules of Civil Procedure’s retention 

and production requirements may conflict 

with a respondent’s data protection obligations 

in other countries. 

The Federal Rules require parties to preserve 

evidence relevant to litigation and to 

produce documents sought under a request 

for production, subpoena, or court order. 

The failure to preserve documents and data 

may be considered spoliation, which may 

result in adverse rulings, independent tort 

claims, and even criminal penalties. Courts 

can impose sanctions if parties fail to produce 

relevant documents that do not enjoy 

privilege in litigation. In 2006, Rule 34 of 

the Federal Rules of Civil Procedure was 

expanded to require parties to retain documents 

and electronic data in anticipation 

of foreseeable litigation and to produce relevant 

electronically stored information once 

litigation begins. 

For multinational organizations, several 

data protection principles in Council 

Directive 95/46/EC are directly implicated 

by Federal Rule of Civil Procedure 34 and 

the recent trend toward proactively and 

prospectively managing documents for 

possible litigation. For instance, these obligations 

potentially conflict with the directive’s 

principles limiting length of retention 

of personal data, processing (storage, organization), 

transfer outside the EU, and 

onward transfer to other litigants, consultants, 

and the courts. 

The Directive in U.S. Courts 

Council Directive 95/46/EC is unclear about 

whether the personal data must actually be 

located in the EU, or whether the data must 

merely have originated in the EU or concern 

a European data subject. In Weiss 

v. National Westminster Bank, PLC, 242 

F.R.D. 33, 41–42 (E.D.N.Y. 2007), the district 

court rejected the plaintiffs’ argument 

that the UK’s data privacy laws did not 

apply to documents located in the United 

States. The plaintiffs based their argument 

on the Restatement (Third) of Foreign Relations 

Law §442, which addresses information 

“outside the United States,” and 

issued an “order directing production of 

information located abroad.” The plaintiffs 

also relied on Societe Nationale Industrielle 

Aerospatiale v. United States District Court 

for the Southern District of Iowa, 482 U.S. 

522 (1987). In that case, the foreign defendants 

did not object to producing information 

located in the United States. However, 

the Weiss court held that “[s]im ply because 

Section 442 and Aerospatiale address documents 

located outside the U.S. does not 

mean that documents obtained involuntarily 

from, or without the consent of, a foreign 

[data subject], and now located in the 

United States, should be accorded any less 

protection.” 

Discovery Blocked in U.S. Courts by 

European Data Protection Laws 

Several U.S. courts have upheld transfer 

restrictions in discovery in U.S. litigation. 

For example, in Salerno v. Lecia, 

Inc., No. 97-CV-973S(H), 1999 WL 299306 

(W.D.N.Y. Mar. 23, 1999), the plaintiff in 

an employment discrimination action 

sought production of personnel and severance 

information for employees of the 

defendant’s European divisions. The district 

court ruled that the documents could 

not be produced, in part because “safeguards 

for the maintenance of personal 

data within the U.S. are viewed by courts in 

European Union countries as insufficient” 

and because the European divisions would 

suffer serious legal penalties for disclosing 

the personal information under E.U. and 

German law. 

Data Transfers, continued on page 89

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In the U.S. 

By Richard N. Sheinis 

and Chad A. Wingate 

Enforcement 

of International 


Navigating a mixture 

of international and 

domestic law, with a 

conflict among federal 

courts sometimes 

thrown in, is required. 

In the United States, arbitration was not well received by 

courts prior to 1925. At that time, judges subscribed to a 

theory known as the “ouster doctrine,” and they refused to 

enforce agreements to arbitrate, reasoning that the agree- 

ments improperly deprived or “ousted” 

courts from hearing claims arising from 

the law of the land. Once an arbitration 

award had been properly made, however, a 

court would enforce the award. The result 

of this practice was that parties could walk 

away from agreements to arbitrate any time 

before issuance of an award. 

This changed when the Federal Arbitration 

Act (FAA) was enacted in 1925. 9 

U.S.C. §§1–16. The FAA legitimized arbitration 

as a legal, binding alternative to 

litigation, and most courts interpreted 

Congress’ move as establishing a national 

policy favoring arbitration. 

In 1958, the United Nations held a conference 

to adopt the Convention on the 

Recognition and Enforcement of Foreign 

Arbitral Awards. Known as the “New York 

Convention,” this convention is a recognized, 

foundational instrument of international 

arbitration that requires courts of 

contracting states to assign effect to agreements 

to arbitrate, and also to recognize 

and enforce awards made in other states, 

subject to specific, limited exceptions. Congress 

adopted the convention by amendment 

as Chapter 2 of the FAA in 1970. 9 

U.S.C. §§201–208. 

The convention’s purpose was to 

“encourage the recognition and enforcement 

of commercial arbitration agreements 

in international contracts and to unify the 

standards by which agreements to arbitrate 

are observed and arbitral awards are 

enforced in the signatory countries.” Termorio 

S.A. E.S.P. v. Electranta S.P., 487 F.3d 

933–34 (D.C. Cir. 2007) (quoting Scherk v. 

Alberto- Culver Co., 417 U.S. 506, 520 n.5. 

In 1975, the Inter- American Convention 

on International Commercial Arbitration, 

also known as the “Panama Convention,” 

was adopted by a conference attended by 

countries belonging to the Organization 

of American States. Congress adopted it in 

1990, and it became Chapter 3 of the FAA. 9 

U.S.C. §301–307. The New York Convention 

and the Panama Convention are the two 


■ Richard N. Sheinis is co-chair of Hall Booth Smith & Slover, PC’s International Law Practice Group. He represents 

business entities in employment and commercial matters. He is certified as an arbitrator and is an 

Associate member of the Chartered institute of Arbitrators. Chad A. Wingate practices in Hall Booth Smith & 

Slover PC’s International Law Practice Group. He has spent time in Austria, studying international commercial 

arbitration, as well as studying in the international courts of Vienna, Salzburg, Munich, Venice, and Milan.

main vehicles used to enforce foreign arbitration 

awards in the United States. 

The New York Convention 

The New York Convention provides that 

countries that ratify it may do so with 

either one or both of two reservations 

offered in Article I (3). The first reservation 

is a “reciprocity reservation.” This limits 

the enforcement of awards only to those 

awards made in countries that have ratified 

the convention. The second reservation is a 

commercial reservation that limits recognition 

and enforcement of awards only to 

those involving commercial disputes. The 

United States has ratified the New York 

Convention with both reservations. Presently, 

all told, 144 counties have ratified the 

New York Convention. 

Arbitration awards fall into one of 

three categories: domestic, foreign, or 

nondomestic. Domestic awards do not 

fall under the New York Convention, and 

instead are governed by Chapter 1 of the 

FAA. Section 202 of the FAA describes both 

“foreign” and “nondomestic” agreements 

and awards, which do fall under the New 

York Convention: 

An agreement or award arising out of a 

legal relationship, whether contractual 

or not, which is considered as commercial, 

including a transaction, contract, 

or agreement described in §2 of this title 

and which is entirely between citizens 

of the United States shall be deemed not 

to fall under the Convention unless that 

relationship involves property located 

abroad, envisages performance enforcement 

abroad, or has some other reasonable 

relation with one or more foreign 

states. For the purpose of this section 

a corporation is a citizen of the United 

States if it is incorporated or has its principal 

place of business in the United 

States. (Italics added). 

Foreign awards are those that are “made 

in a State other than the State where the 

recognition and enforcement of such 

awards are sought.” 

A nondomestic award subject to the New 

York Convention has been defined as one 

made within the legal framework of another 

country, or involving parties domiciled or 

having their principal place of business outside 

the enforcing jurisdiction. Bergesen v. 

Mulle Corp., 710 F.2d 928, 932 (2d Cir. 1983); 

see also Jain v. de Mere, 51 F.3d 686, 689 (7th 

Cir. 1995), cert. denied, 516 U.S. 914 (1995). 

A general rule of thumb for distinguishing 

a “foreign” award from a “nondomestic” 

award is to discover where the 

award was made. A “foreign” award will 

always be made abroad, while a “nondomestic” 

award will usually be made in 

the United States. However, an award made 

abroad but under U.S. law will also be considered 

“nondomestic.” The important 

point about nondomestic awards is that 

they are subject to both Chapters 1 and 2 of 

the FAA, while foreign awards are subject 

only to Chapter 2. This leads to an important 

distinction between foreign awards 

and nondomestic awards. 

The New York Convention, Chapter 2 of 

the FAA, enumerates specific grounds on 

which a court can refuse to enforce an arbitration 

award. It does not include a provision 

permitting a court to vacate an arbitration 

award. Since foreign awards are only subject 

to Chapter 2, a court has no ground to 

vacate an arbitration award confirmed by a 

foreign court. A U.S. court only has grounds 

through Chapter 2 to refuse to enforce that 

award. The reason is that a losing party argues 

for vacatur in the state where the award 

was made, while a winning party seeks enforcement 

of an award in a country other 

than the one where the award was made. 

Because the court in the second country has 

no jurisdiction to vacate an award from the 

first country, the country where the award 

was made, the second court can only refuse 

to confirm or “enforce” the award. 

Chapter 1, the domestic chapter of the 

FAA, does, however, allow courts to vacate 

arbitration awards. Since nondomestic 

awards are subject both to Chapters 1 and 

2, a losing party can affirmatively seek to 

vacate a nondomestic award under Chapter 

1’s authority. The grounds for vacating 

an award as contained in the FAA will 

only apply if the arbitration was held in 

the United States and a party filed a timely 

motion to vacate the award in the district 

court of the place of the arbitration. 

Panama Convention 

The Panama Convention applies when arbitration 

arises from a commercial relationship 

between citizens of signatory nations. 

Sanluis Developments, L.L.C. v. CCP Sanluis, 

LLC, 498 F. Supp. 2d 699 (S.D.N.Y. 2007). 

Article V of the Panama Convention nearly 

mirrors Article V of the New York Convention 

regarding the bases for refusing to enforce 

arbitration awards. International Ins. 

Co. v. Caja Nacional de Ahorro y Seguro, No. 

00C6703, 2001 WL322005 (N.D. Ill. Apr. 2, 

2001) (the Panama Convention defenses are 

“essentially the same” as the New York Convention 

defenses). The legislative history of 

the Panama Convention’s implementing 

statute shows that Congress intended for 

the same results to be reached whether the 

New York Convention or the Panama Convention 

is applied. Republic of Ecuador v. 

Chevron Texaco Corporation, 376 F. Supp. 

2d 334, 348 (S.D.N.Y. 2005). However, this 

is not to say that the conventions are nearly 

identical in all respects. 

When both the New York and Panama 

Conventions could apply, courts determine 

which convention to use as follows: 

1. If a majority of the parties to the arbitration 

agreement are citizens of a state 

or states that have ratified the Panama 

Convention, the Inter- American Convention, 

and are member states of the 

Organization of American States, the 

Panama Convention will apply. 

2. In all other cases, the New York Convention, 

the Convention on the Recognition 

and Enforcement of Foreign Arbitral 

Awards, will apply. 

Republic of Ecuador v. Chevron Texaco Corporation, 

376 F. Supp. 2d 334, 348 (S.D.N.Y. 

2005). 

Enforcement Under the 

New York Convention 

As mentioned, the New York Convention 

provides that countries that ratify it may 

do so with either one or both of two reservations, 

offered in Article I (3). The first 

reservation is a “reciprocity reservation.” 

This limits the enforcement of awards only 

to those awards made in another country 

that has ratified the convention. The second 

reservation is a commercial reservation. 

This limits recognition and enforcement of 

awards to those only involving commercial 

disputes. The United States ratified the New 

York Convention with both reservations. 

Since the New York Convention is older 

than the Panama Convention, most of the 

applicable case law involves the former. A 

party can seek enforcement in any country 

in which the losing party has assets. And 



the U.S. district courts have jurisdiction 

when a party seeks to enforce a foreign or 

nondomestic award in the United States. 

9 U.S.C. §207. 

An action to enforce or confirm an 

award must commence within three years 

of an award’s origin. 9 U.S.C. §§207, 302. 

A party seeking to enforce an arbitration 

award can establish a prima facie case for 

The legislative history… 

shows that Congress 

intended for the same 

results to be reached 

whether the New York 

Convention or the Panama 

Convention is applied. 

enforcement by providing the original or 

a certified copy of the arbitration agreement 

and award. 9 U.S.C. §§207, 302. Once 

a party has made a prima facie case for 

enforcement, a district court “shall confirm” 

the arbitration award unless one of 

the grounds for refusal specified in the New 

York Convention exists. 9 U.S.C. §207. 

Article V of the New York Convention 

provides the exclusive grounds for refusing 

to enforce an award. Seung Woo Lee v. Imaging 

3, Inc., 283 Fed. Appx. 490, 492 (9th Cir. 

2008) (the grounds for refusal to recognize 

or enforce an arbitration award are limited 

to the seven grounds listed in Article V). 

As long as a party requests enforcement 

within the three years prescribed under 

section 207 of the FAA, unless it finds one 

of the seven Article V grounds, a U.S. court 

must confirm an award. A court must find 

one of the following grounds to refuse to 

enforce an award: 

• The contracting parties suffered under 

some incapacity or the arbitration agreement 

was invalid. 

• A losing party that failed to pay the 

award did not receive proper notice 

of the arbitration proceedings or was 

unable to present its case. 


• The arbitration exceeded the scope of the 

arbitration agreement. 

• The arbitration panel or procedure did 

not conform to the parties’ agreement 

or applicable law. 

• The arbitration award has not yet become 

binding or has been set aside or suspended 

by a competent authority of the 

country in which the award was made or 

under the governing law of that country. 

• The subject matter was not subject to 

arbitration. 

• Enforcing the award would conflict with 

public policy. 

The party seeking to prevent enforcement 

bears the burden of producing competent 

authority that one of the enumerated 

grounds exists. 

Defending Against Arbitration 

Award Enforcement 

As mentioned, a court can refuse to enforce 

an arbitration award if one of the seven 

grounds listed above exist, so defenses 

against enforcement generally rely on one 

or more of those seven grounds. 

Incapacity or Invalidity 

As noted, under the New York Convention’s 

Article V (1)(a), a court can refuse to 

enforce an arbitration award 

Where the parties were, under the law 

applicable to them, under some incapacity, 

where the said agreement is not 

valid under the law to which the parties 

have subjected it or, failing any indication 

thereon, under the law of the country 

where the award is made. 

No U.S. court has denied to enforce a foreign 

arbitration award either because one 

or both of the contracting parties suffered 

an incapacity or because an agreement to 

arbitrate was invalid under the applicable 

law. Incapacity at the time of an arbitration 

hearing is not a defense. To use incapacity 

as a defense to an enforcement action, 

a party must show that it suffered from an 

incapacity when it signed the contract containing 

the arbitration agreement. Seung 

Woo Lee v. Imaging 3, Inc., 283 Fed. Appx. 

490, 492 (9th Cir. 2008). The validity necessary 

under Article V (1)(a) requires that 

the arbitration agreement be “in writing,” 

as specified under Article II (1). Courts generally 

interpret the “in writing” requirement 

broadly, meaning that it can be met 

by incorporation into or reference to other 

agreements. Ibeto Petrochemical Industries 

Limited v. M/T Beffen, 475 F.3d 56, 63 

(2d Cir. 2007) (“a broadly worded arbitration 

clause which is not restricted to the 

immediate parties may effectively be incorporated 

by reference into another agreements”) 

(quoting Progressive Cas. Ins. Co. 

v. C.A. Reaseguradora Nacional de Venezuela, 

991 F.2d 42, 48 (2d Cir. 1993)). 

Due Process Violations 

Article V (1)(b) of the New York Convention 

states that a court can refuse to enforce a foreign 

arbitration award if the “party against 

whom the award is invoked was not given 

proper notice of the appointment of the arbitrator 

or of the arbitration proceedings or 

was otherwise unable to present his case.” 

This defense has not often been successful. 

Instead, U.S. courts have narrowly 

construed Article V (1)(b), considering the 

overall arbitration result and determining 

whether a defendant received a fair hearing. 

Courts defer greatly to arbitrators’ rulings 

regarding the relevancy of evidence, 

and absent a showing of abusive discretion, 

a court probably will not refuse to enforce 

an arbitration award based on an allegation 

of improper evidence or an allegation that 

proper evidence was missing. Laminoris- 

Trefileries- Cableries de Lens, S. A. v. Southwire 

Co., 484 F. Supp. 1063 (N.D. Ga. 1980). 

A party cannot fail to appear at a hearing, 

or fail to offer a satisfactory explanation 

for its absence, and then prevent 

enforcement of an award on the grounds 

that it was unable to present its case. Fitzroy 

Eng.’g Ltd. v. Flame Eng’g Ltd., 1994 U.S. 

District LEXIS 17781, at *16 (N.D. Ill. Dec. 

2, 1994). In Iran Aircraft Industries v. Auco 

Corporation, 980 F.2d 141 (2d Cir. 1992), 

however, the court used this ground to 

refuse to enforce an arbitration award. The 

facts of that case were that an American 

company was unaware that a replacement 

tribunal judge had changed the evidentiary 

requirements, which prevented it from 

fully presenting its case. Id. 

Exceeds the Submission Terms 

or Arbitration Scope 

Article V (1)(c) of the New York Convention 

provides that a court can refuse to enforce 

an arbitration award when 

The award deals with a difference not

contemplated by or not falling within the 

terms of the submission to arbitration, or 

it contains decisions on matters beyond 

the scope of the submission to arbitration, 

provided that, if the decisions on 

matters submitted to arbitration can be 

separated from those not so submitted, 

that part of the award which contains 

decisions on matters submitted to arbitration 

may be recognized and enforced. 

This defense is not often successful because 

usually courts broadly interpret the 

scope of the differences in arbitration agreements 

that parties have agreed to arbitrate. 

This defense has a narrow application, and 

a court will not second guess an arbitrator’s 

construction of the parties’ arbitration 

agreement. Parsons & Whittemore Overseas 

Co. v. Societe Generale de L’Industrie du Papier, 

508 F.2d 969, 977 (2d Cir. 1974). As to 

doubts, “any doubts concerning the scope 

of arbitrable issues should be resolved in favor 

of arbitration, whether the problem at 

hand is the construction of the contract language 

itself, or an allegation of waiver, delay, 

or a like defense to arbitrability.” Progressive 

Casualty Insurance Co. v. C. A. Reaseguradora 

Nacional De Venezuela, 991 F.2d 

42, 48 (2d Cir. 1993) (citing Mitsubishi Motors 

Corp. v. Soler Chrysler- Plymouth, Inc., 

473 U.S. 614, 626 (1985)). 

Improper Arbitration Procedure or 

Arbitration Panel Composition 

Article V (1)(d) of the New York Convention 

states that a court will not enforce a foreign 

arbitration award when 

The composition of the arbitral authority 

or the arbitral procedure was not in accordance 

with the agreement of the parties 

or, failing such agreement, was not in 

accordance with the law of the country 

where the arbitration took place. 

U.S. decisions have upheld awards that 

have addressed improper composition of 

arbitration panels convened under the New 

York Convention. For instance, in Imperial 

Ethiopian Government v. Baruch- Foster 

Corp., 535 F.2d 334 (5th Cir. 1976), it was 

discovered after the award was made that 

the third arbitrator had previously drafted 

the civil code for the Ethiopian government, 

the prevailing party in the arbitration. 

Baruch- Foster argued that this 

violated the arbitration agreement, which 

provided that the third arbitrator should 

have no direct or indirect connection with 

either party. The court of appeals affirmed 

the enforcement of the award by the district 

court on the grounds that the defendant’s 

allegations were unsubstantiated. 

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made by a sole arbitrator. The award was 

enforced because the New York Convention 

allows a court to recognize an award that 

complied with laws of the country where the 

arbitration occurred. The arbitration had 

occurred in the United Kingdom, where a 

sole arbitrator may decide a dispute. 

A Not Yet Binding, Set Aside, 

or Suspended Award 

Article V (1)(e) of the New York Convention 

allows a court to refuse to enforce an 

award when “the award has not yet become 

binding on the parties, or has been set aside 

or suspended by a competent authority of 

the country in which, or under the law of 

which, that award was made.” 

“Binding” generally means that no further 

appeals are available. Enforcing an 

award, however, does not require a party 

to exhaust all of the court appeals in the 

country in which the arbitration award 

was made. 

In Fertilizer Corp. of India v. IDI Management, 

Inc., 517 F. Supp. 948 (S.D. Ohio 

1981), the defendant took the position that 

the arbitration award against it was not 

binding because it was under review by 

an Indian court for errors of law. The federal 

court in Ohio found that the award 

was binding for purposes of the New York 

Convention and quoted Gerald Aksen, former 

general counsel of the American Arbitration 

Association, who had commented, 

“The award will be considered ‘binding’ 

and for the purposes of the Convention if 

no further recourse may be had to another 

arbitral tribunal (that is, an appeals tribunal). 

The fact that recourse may be had to 

a court of law does not prevent the award 

from being ‘binding.’” 

One case in which a court used this 

ground to refuse to enforce an arbitration 

award is Termorio S.A.E.S.P. v. Electranta, 

487 F.3d 928 (D.D.C. 2007). The 

court refused to enforce a Colombian arbitration 

award, which had been lawfully set 

aside by a Colombian court. 

Non-arbitrable Subject Matter 

Article V (2)(a) of the New York Convention 

specifies that if a prospective enforcing 

court’s national laws prevent parties from 

arbitrating a controversy due to its subject, 

the court may refuse to enforce an arbitration 

award. 


To take advantage of this defense, a 

party must prove that the enforcing nation 

attaches a special national interest to the 

dispute that makes settling it by arbitration 

impossible. The national interest must 

be more than “incidentally” involved in the 

dispute for a court to find that the dispute is 

not arbitrable. Parson & Whittemore Overseas 

Co. v. RAKTA, 508 F.2d 969, 975 (2d 

Cir. 1974). 

In Mitsubishi Motors Corp. v. Soler 

Chrysler- Plymouth, Inc., 473 U.S. 614 

(1985), the defendant argued that antitrust 

claims, which were the subject of 

the dispute, were not subject to arbitration. 

The court found the claims arbitrable 

and stated that “concerns of international 

comity, respect for the capacities of foreign 

and transnational tribunals, and sensitivity 

to the need of the international commercial 

system for predictability in the resolution 

of disputes require that we enforce the 

parties’ agreement, even assuming that a 

contrary result would be forthcoming in a 

domestic context.” Id. at 629. 

One case in which an arbitration award 

was not enforced because the court found 

that the subject matter was not arbitrable 

was Libyan American Oil Co. v. Socialist 

Peoples Libyan Arab Jamahirya, 482 F. 

Supp. 1175 (D.D.C. 1980), vacated without 

op., 684 F. 2d 1032 (D.C. Cir. 1981). 

Public Policy 

Article V (2)(b) states that if recognizing 

or enforcing an award would conflict 

with the public policy of the country 

where a party seeks enforcement, a court 

can refuse to enforce the award. As with 

other grounds against enforcing arbitration 

awards, courts narrowly construe this 

ground, applying it only when effectuating 

an award would violate the most basic 

notions of morality and justice of the foreign 

state. Parson & Whittemore Overseas 

Co. v. RAKTA, 508 F.2d 969, 973 (2d Cir. 

1974). 

In Fitzroy v. Flame, 1994 U.S. District 

LEXIS 17781 (N.D. Ill. Dec. 2, 1994), the 

party opposing enforcement asserted the 

public policy exception, claiming that its 

own counsel had failed to disclose a conflict 

of interest. The court stated that to prevail 

on that defense, “the respondent must 

convincingly show that a clear, direct conflict 

existed that could have affected the 

outcome of the proceeding.” Id. The court 

held that the respondent failed to meet this 

burden. Id. 

One case in which the public policy 

defense was used successfully is Laminoirs- 

Trefileries- Cableries de Lens, S.A. v. Southwire 

Co., 484 F. Supp. 1063 (N.D. Ga. 1980). 

The court refused to enforce the interest 

payments ordered by the arbitrators as the 

interest rate was so excessive that it was 

penal, holding that the penal nature of the 

interest violated public policy. 

Vacating Non-domestic 


While foreign arbitration awards are governed 

strictly by the New York Convention, 

which contains no authority to vacate or 

set aside a foreign award, court may vacate 

nondomestic awards under the applicable 

law of the country in which a party initiates 

a vacatur action, that is, either the country 

in which the award was made, or the country 

of the law of choice specified in the arbitration 

agreement. International Standard 

Elec. Corp. v. Bridas Sociedad Anonima 

Petrolera Industrial Y Comercial, 745 F. 

Supp. 172, 178 (S.D.N.Y. 1990). 

In the United States, the governing law 

in section 10 of Chapter 1 of the FAA specifies 

that the grounds to vacate an arbitration 

award are 

(1) where the award was procured by 

corruption, fraud, or undue means; 

(2) where there was evident partiality 

or corruption in the arbitrators, or 

either of them; 

(3) where the arbitrators were guilty of 

misconduct in refusing to postpone 

the hearing, upon sufficient cause 

shown, or in refusing to hear evidence 

pertinent and material to the 

controversy; or of any other misbehavior 

by which the rights of any 

party have been prejudiced; or 

(4) where the arbitrators exceeded their 

powers, or so imperfectly executed 

them that a mutual, final, and definite 

award upon the subject matter 

submitted as not made. 

9 U.S.C. §10. 

An action to vacate a nondomestic 

award can overlap with an action to enforce 

the same award. In Yusef Ahmed Alghanim 

& Sons, W.L.C. v. Toys “R” Us, Inc., 126 F.3d 

15 (2d Cir. 1997), a dispute arose out of li-

censing and supply agreements between 

Toys “R” Us and Yusuf Ahmed Alghanim 

& Sons (Alghanim). Toys “R” Us then sold 

its franchise rights to Alghanim’s territory 

to two other companies and invoked 

the arbitration clause in the agreement, 

which called for arbitration to take place 

in the United States. The arbitrator found 

that Toys “R” Us had breached the contract, 

and awarded Alghanim $46.44 million in 

lost profits, plus interest. The district court 

found that since the New York Convention 

and the Chapter 1 of the FAA both governed 

the award, a petition to confirm under the 

convention did not foreclose a cross- motion 

to vacate under Chapter 1 of the FAA. The 

Second Circuit affirmed, holding that this 

was a nondomestic award within the scope 

of the New York Convention, and the district 

court had authority under the convention 

to apply the FAA’s implied ground of 

manifest disregard of the law to vacate the 

award. It then found that in this case, the 

criteria for finding manifest disregard of the 

law had not been met. Id. at 17–24. 

Is Manifest Disregard a 

Valid Vacatur Ground 

The U.S. courts have supplemented the 

narrow procedural grounds for vacatur, 

found in U.S.C. 9 §10, with a handful of 

nonstatutory grounds. These common 

law grounds supporting vacatur include 

awards that are “arbitrary and capricious,” 

“completely irrational,” fail to draw their 

essence from the underlying contracts, or 

those in “manifest disregard of the law.” 

Ainsworth v. Kurnick, 960 F.2d 939 (11th 

Cir. 1992) (“completely irrational”); see 

also Val-U Constr. Co. v. Rosebud Sioux 

Tribe, 146 F.3d 573, 578 (8th Cir. 1999); 

and see also Apex Plumbing Supply, Inc. 

v. U.S. Supply Co., Inc., 142 F.3d 188, 192 

(4th Cir. 1998); Hoffman v. Cargill, Inc., 59 

F. Supp. 2d 861 (N.D. Iowa 1999) (fails to 

draw its essence from the underlying contract); 

Advest Inc. v. McCarthy, 914 F.2d 6, 

8 (1st Cir. 1990) (“manifest disregard of 

the law”); see Wilco v. Swan, 363 U.S. 427, 

436–37 (1953), overruled on other grounds; 

Rodriguez de Quijas v. Shearson/American 

Express, Inc., 490 U.S. 477 (1989). 

Among these, manifest disregard of the 

law has been the most widely used by 

courts to set aside, or vacate, arbitration 

awards. Norman S. Poser, Judicial Review 

of Arbitration Awards: Manifest Disregard 

of the Law, 64 Brooklyn L. Rev. 471 

(1998); Stephen L. Hayford, Law in Disarray: 

Judicial Standards for Vacatur of Commercial 

Arbitration Awards, 30 Ga. L. Rev. 

731 (1996); Marcus Mungioli, The Manifest 

Disregard of the Law Standard: A Vehicle 

for Modernization of the Federal Arbitration 

Act, 31 St. Mary’s L.J. 1079 (2000); 

Lionel M. Schooler, Arbitration at the Millenium: 

Developments in the Law, 37 Houston 

Lawyer 27, 31 (2000). 

The standard for finding manifest disregard 

of the law is extremely high. Courts 

usually require the party arguing for vacatur 

to show that (1) the law was unambiguous 

and clearly applicable, (2) the arbitrator 

knew the law, and (3) the arbitrator chose 

to ignore the law despite his or her knowledge 

of it. See Greenberg v. Bear, Stearns & 

Co., 220 F.3d 22, 28 (2d Cir. 2000); Health 

Svcs. Mgmt. Corp. v. Hughes, 975 F.2d 1253, 

1267 (7th Cir. 1992). 

It was traditionally thought that the 

manifest disregard doctrine was available 

as a means of vacating an award in domestic 

arbitration cases only. See, e.g., M & C Corp. 

v. Erwin Behr GMBH & Co., KG, 87 F.3d 844, 

851 (6th Cir. 1996) (concluding that the convention’s 

exclusive grounds for relief “do 

not include miscalculations of fact or manifest 

disregard of the law”); International 

Standard Elec. Corp. v. Bridas Sociedad 

Anonima Petrolera, Industrial y Comercial, 

745 F. Supp. 172, 181–82 (S.D.N.Y. 1990) (refusing 

to apply a “manifest disregard of law” 

standard on a motion to vacate a foreign arbitration 

award); Brandeis Intsel Ltd. v. Calabrian 

Chems. Corp., 656 F. Supp. 160, 167 

(S.D.N.Y. 1987) (“In my view, the ‘manifest 

disregard’ defense is not available under Article 

V of the Convention or otherwise to a 

party… seeking to vacate an award of foreign 

arbitrators based upon foreign law.”); 

see also Albert Jan van den Berg, The New 

York Arbitration Convention of 1958: Towards 

a Uniform Judicial Interpretation 265 

(1981) (“the grounds mentioned in Article 

V are exhaustive”). 

This notion was tossed aside in Yusuf 

Ahmed Alghanim & Sons, W.L.L. v. Toys 

“R” Us, Inc., 126 F.3d 15 (2d Cir. 1997), 

when the court unequivocally stated that 

manifest disregard of the law was a means 

of vacatur in nondomestic cases governed 

by the New York Convention. Id. at 19–20. 

Does Hall Street Preclude 

Manifest Disregard Doctrine 

The Hall Street Associates, L.L.C. v. Mattel, 

Inc., 128 S. Ct. 1396 (2008), case arose 

from a commercial, landlord- tenant dispute 

between Mattel, the tenant, and its 

landlord, Hall Street. Following the discovery 

of environmental contamination on the 

leased property, Mattel notified Hall Street 

An action to vacate a 

nondomestic award can 

overlap with an action to 

enforce the same award. 

that it intended to terminate the lease. After 

Mattel won the initial litigation over the 

termination provisions in the lease, Hall 

Street and Mattel agreed to submit the 

indemnification issue to arbitration. The 

arbitration agreement, which was approved 

and entered as an order by the federal district 

court, specified that the federal court 

would review, de novo, the arbitrator’s conclusions 

of law. The arbitrator decided the 

dispute in Mattel’s favor. 

The district court, however, exercised the 

provision in the parties’ arbitration agreement 

that allowed review for “legal error,” 

determined that the arbitrator had made an 

erroneous conclusion of law, and vacated 

the award. The district court remanded the 

case to the arbitrator for further consideration, 

after which the arbitrator then decided 

the dispute in Hall Street’s favor. The 

district court upheld the arbitrator’s second 

award. Mattel then switched horses, contending 

that, according to Kyocera Corp. v. 

Prudential- Bache Trade Servs., Inc., 341 F.3d 

987, 1000 (9th Cir. 2003), the parties agreement 

allowing judicial review for legal error 

was unenforceable. The Ninth Circuit 

decided the case in Mattel’s favor, reversing 

the district court’s decision on the ground 

that allowing the district court to vacate the 

initial award for “legal error” was not an authorized 

vacatur ground under the FAA, 

regardless of that provision in the arbitration 

agreement. The Supreme Court granted 

certiorari on whether the FAA’s statutory 



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grounds for vacatur and modification under 

sections 10 and 11 were exclusive. Hall 

Street, 128 S. Ct. at 1400–01. 

The Supreme Court agreed with the 

Ninth Circuit, which had reaffirmed its 

own decision from Kyocera Corp., although, 

whether the Court struck down manifest 

disregard is less than clear. The Ninth Circuit’s 

decision in Kyocera overruled its previous 

decision in La Pine Technology Corp. 

v. Kyocera Corp., 130 F.3d 884 (9th Cir. 9 

1997), which held that parties were free 

to contract for an alternative standard of 

review. Id. at 888. Furthermore, the court 

in La Pine clearly distinguished the contractually 

enhanced judicial review from 

judicially defined grounds for vacating an 

arbitration award, such as manifest disregard 

of the law. 

It is beyond peradventure that in the 

absence of any contractual terms regarding 

judicial review, a federal court may 

vacate or modify an arbitration award 

only if that award is ‘completely irrational,’ 

exhibits a ‘manifest disregard of 

law,’ or otherwise falls within one of the 

grounds set forth in 9 U.S.C. §§10 or 11. 

Todd Shipyards Corp. v. Cunard Line, 

Ltd., 943 F.2d 1056, 1060 (9th Cir. 1991) 

(citation omitted). The instant case does 

not, however, fall neatly within the contours 

of the usual rule. That is because 

the parties indisputably contracted for 

heightened judicial scrutiny of the arbitrators’ 

award when they agreed that 

review would be for errors of fact or law. 

Id. 

The Ninth Circuit’s holding in La Pine 

clearly aimed to support contractual expansion 

of judicial review of determinations of 

fact and law at the foundation of arbitration 

awards, not manifest disregard or other 

judicial doctrines. Kyocera overturned this 

narrow holding in La Pine regarding contractual 

judicial review, and the Supreme 

Court agreed when it affirmed the Ninth 

Circuit’s decision that the FAA provides 

the “exclusive” grounds for vacatur. This 

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conclusion is further supported by the 

Court’s language throughout the Hall Street 

opinion. When describing the split among 

the circuits that the opinion was intended 

to fix, the Court only discussed the split 

regarding parties’ ability to contract for 

expanded judicial review. Hall Street, 128 

S. Ct. at 1403. The Court listed the circuits 

that had held that parties may not contract 

for expanded judicial review of arbitrations, 

and those that had held that it was 

allowed. Id. at n.5. There was no mention 

of a circuit split over judicially expanded 

review of arbitration awards beyond the 

four statutory grounds in the FAA. 

The Court addressed manifest disregard 

of the law only because Hall Street argued 

that the use of the judicial doctrine was 

proof that the FAA’s vacatur grounds were 

not exclusive. Id. at 1404. The court distinguished 

manifest disregard of the law 

from contractual terms for judicial review 

in two ways. First, it swatted away Hall 

Street’s “camel’s nose” argument, stating 

that it is quite a “leap from a supposed judicial 

expansion by interpretation to a private 

expansion by contract.” Second, the 

Court remarked that the manifest disregard 

doctrine originated with a statement 

in Wilko v. Swan, 346 U.S. 427 (1953). In 

Wilko, the Supreme Court said that “power 

to vacate an arbitration award is limited… 

the interpretations of the law by the arbitrators 

in contrast to manifest disregard [of 

the law] are not subject… to judicial review 

for error in interpretation.” Id. at 436–37. 

The Wilko decision expressly rejected Hall 

Street’s request “for general review for an 

arbitrator’s legal errors.” Hall Street, 128 

S. Ct. at 1404. The Court provided another 

interpretation of the use of the term “manifest 

disregard” in the Wilko court, stating 

that it could have been “shorthand” for 

certain FAA provisions. Id. It then evaded 

the underlying question—whether manifest 

disregard of the law was still a ground 

for vacatur—by reaffirming its view of the 

doctrine from First Options of Chicago, Inc. 

v. Kaplan, 514 U.S. 938 (1995), which said 

that manifest disregard of the law was a 

ground for vacatur, further stating that it 

would not “accord” the doctrine the significance 

that Hall Street urged. Hall Street, 

128 S. Ct. at 1404. This indicates that the 

Court did not accept Hall Street’s argument 

Arbitration, continued on page 84 


W R I T E R S ’ C O R N E R 

Tedious Bound 

Must Briefs Be Boring 

By Roger D. Townsend 

Lamentations issue from every quarter about how 

badly briefs are written: Garner grinds his teeth; judges 

cringe; and law clerks sit cross-eyed, but hardly painless. 

Even when briefs are carefully crafted, they remain 

more boring than Balzac. Although experts provide 

practical tips for making briefs more interesting, it’s 

a relative concept. They can be made more interesting 

than the Physicians’ Desk Reference. But more interesting 

than Nicholas Nickleby Never. 

Legal briefs will inevitably be duller than Dickens. 

Despite facts as riveting as the latest Rushdie novel or 

as convoluted as a le Carré plot, briefs are doomed to tediousness 

by their requirements. The extraordinary need 

for precision eliminates the elegant variation so felicitous 

in fiction and scares advocates away from flights of poetic 

fantasy. Further, briefs consist almost exclusively of facts 

and law. Statements about the law are almost always abstract. 

And abstractions are usually boring—especially 

when they are true. Nietzsche was anything but boring, 

but a lot of his assertions were questionable. Whitehead 

and Russell’s Principia Mathematica is logically precise, 

but it is also a more effective anesthetic than Diprivan. 

Someone could increase interest by including more 

factual details. Because details paint a picture, many 

authorities advise us to write concretely. E.g., William 

Strunk & E.B. White, The Elements of Style 21–23 (3d ed. 

1979); Rudolf Flesch, The Art of Readable Writing 26–35, 

72–99 (1974 ed.). For example, consider how a García 

Márquez clone might mesmerize us as he describes the 

crisp, lavender curtains casting across a scuffed oak floor 

a rainbow shadow reminiscent of the June downpour in 

Pereira that had once filled Clemencia’s flaring nostrils 

with the smoky scent of a 30-year-old oloroso, instantly 

reminding her that precisely two years ago her grandmother 

had been devoured in one gigantic gulp by the 

first barber- pole- striped humpback whale ever encountered 

in the murky Magdalena del Rio on a lazy Sunday 

afternoon. 

You will never read that sentence, or even a similar 

one, in a legal brief. 

First, you will not find that evidence in the record. 

Do you know a court that would permit a witness to testify 

in that fashion The most interesting details would 

be based not on personal knowledge, but opinion. And 

would the witness have personal knowledge about granny’s 

predator, or would she rely on hearsay Besides, 

do you know a court that would allow that testimony 

over an objection that it is irrelevant and unduly timeconsuming 

As descriptive as those details are, they 

will not appear in the record; so, you cannot use them 

in a brief. 

Second, even Joyce might have struggled to imagine 

an appeal in which all those facts would be relevant to 

the legal issues. Briefs should relate only the facts material 

to the legal issues in dispute. E.g., Antonin J. Scalia 

& Bryan A. Garner, Making Your Case: The Art of 

Persuading Judges 94–95 (2008); Herbert Monte Levy, 

How to Handle an Appeal §6:5 (4th ed. 2008); Ruggero 

J. Aldisert, Winning on Appeal: Better Briefs and Oral 

Argument 164–65, 168–69 (2003). Too many details lead 

busy courts down paths to nowhere. And legal reasoning 

forces advocates to generalize the facts of one case so 

that they can draw analogies to the facts of another case. 

These requirements push advocates to state the facts less 

concretely, diminishing the descriptive possibilities. This 

does not mean that a particular statement of facts cannot 

enliven a scene. But it will never rival Tolstoy. 

Third, courts impose severe word or page limits on 

briefs because of heavy caseloads and long-winded 

advocates who do not know what they are trying to say, 

much less how to say it. Modern judges want briefs that 

tell them what they need to know to decide cases. While 

descriptive details make writing more vivid, they add 

unnecessary information. Ironically, they are likely to 

bore busy judges, who perhaps prefer Dostoyevsky, or 

even Robbins, for their pleasure reading. 

Then, there is the problem of allusions. Once upon a 

time, advocates made their briefs more interesting, and 

showed off their erudition, by using classical and other 

allusions. No more. Several reasons explain the change. 

One is, again, the page and word limitations established 

for briefs. Others are, perhaps, the recent emphasis on 

earning degrees in fields other than the liberal arts and 

n Roger D. Townsend is a partner in the Houston office of a civil-appellate firm, 

Alexander Dubose & Townsend LLP. A fellow and now treasurer of the American 

Academy of Appellate Lawyers, Mr. Townsend has chaired the Appellate Practice 

Section of the State Bar of Texas, was the national editor for Superseding and Staying 

Judgments: A National Compendium (ABA TIPS 2007), authored a chapter on 

brief writing for A Defense Lawyer’s Guide to Appellate Practice (DRI 2004), and was 

editor- in- chief for the Texas Appellate Practice Manual (2d ed. 1993). He is also a the statistics showing how few people read for pleasure 

member of the DRI Appellate Advocacy Committee. Writers’ Corner, continued on page 90 


T H I N K G L O B A L LY 

BP’s Disaster a “Tipping Point” 

The Need for Better Intersections 

Between Claiming Systems 

for Mass Tort Claims 

By Kirk T. Hartley 

BP’s oil rig disaster is surely one of the largest mass 

tort events in history in terms of the enormous potential 

cost of the losses and potential crossborder impact. 

This column will explore some of the disaster’s lessons 

for mass tort claiming processes across borders. Hopefully 

BP’s disaster will become a “tipping point” toward 

thinking about ways to efficiently and fairly resolve 

crossborder, mass tort claims. 

Mass tort events generate an overarching problem of 

how to manage and pay the claims that rules of law and 

science define as legitimate claims. A critical but essentially 

ignored sub- issue is how to manage claims involving 

parallel claiming processes. To date, legislatures 

and courts in the United States have not established, 

much less considered, a useful means for effectively and 

quickly coordinating and managing mass tort claims 

between different court systems. In that light, it is not 

surprising that both the United States and UK systems 

also lack a uniform, effective means of coordinating 

their respective systems with claims submitted to trust 

funds created through Chapter 11 cases, or claims submitted 

to privately created trust funds, such as the BP 

fund. There also are very few useful papers from academics 

or groups such as the American Law Institute. 

Public or private funds are increasingly used to 

resolve mass torts Thus, BP is hardly alone in offering to 

pay claims through a more or less voluntary fund that 

isn’t tied to bankruptcy. Moreover, such funds are not 

unique to the United States and and instead also are in 

use outside the United States. Other examples of public 

or private funds created to resolve mass tort claims 

include the 9/11 Fund and various private trusts created 

in Australia, Africa, and Europe to resolve asbestos 

claims. 

n Kirk T. Hartley is a partner in Childress Duffy, a Chicago- based litigation boutique 

with a national practice. He has over 25 years of experience practicing at the litigation 

intersections among insurance, corporate, tort, and bankruptcy law. Among 

others relevant to this article, Mr. Hartley has tried underlying asbestos cases, and 

an asbestos bankruptcy. Mr. Hartley is a member of DRI and its International Law expert witness report submitted by Nobel- prize winning 

Committee. Think Globally, continued on page 88 


How widespread are the Chapter 11cases for managing 

mass tort claims Although sometimes seriously flawed, 

Chapter 11 cases and resulting trusts or funds are in place 

or contemplated for dozens of former makers, sellers, or 

installers of asbestos- containing products. See generally 

Lloyd Dixon, Geoffrey McGovern, and Amy Coombe, Asbestos 

Bankruptcy Trusts: An Overview of Trust Structure 

and Activity with Detailed Reports on the Largest 

Trusts (available online at the RAND website, http://www. 

rand.org/pubs/technical_reports/TR872/; last visited August 17, 

2010). Trusts and funds also are in use or contemplated 

for claims arising from sexual abuse by Catholic priests; 

and claims involving breast implants, silica claims, and 

Chinese drywall. Consider also the Chrysler and GM 

Chapter 11 cases that ostensibly leave virtually no assets 

behind to pay tort claims against the manufacturers. 

Will BP file for Chapter 11, or might it file a scheme 

of arrangement in the United Kingdom Many, including 

me, think that some BP entities will soon enough 

choose to file for reorganization in some forum to obtain 

an injunction against claims. If BP files some entities for 

Chapter 11, other defendants likely will use the same tactic, 

invoking the “related to” rules of Chapter 11 courts. 

Consider also the possibility that BP will invoke United 

Kingdom financial reorganization procedures commonly 

known as “schemes of arrangement.” 

How has the Chapter 11 trust fund process worked as 

the default system for resolving mass tort claims Some 

negative comments and answers are set out in a brief 

but thoughtful essay by Judge Jack Weinstein, a smart, 

veteran jurist previously responsible for myriad mass 

tort claims and Chapter 11 cases, including some issues 

related to the fiasco commonly known as the Johns- 

Manville asbestos bankruptcy. See Jack B. Weinstein, 

Preliminary Reflections on Administration of Complex 

Litigations, 2009 Cardozo L. Rev. De Novo 1, available 

at http://www.cardozolawreview.com. 

The Chapter 11 claims estimation process also has 

been the subject of criticism in other forums. One is an

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Arbitration, from page 80 

that “if judges can add grounds to vacate, 

so can contracting parties.” See id. at 1403. 

Unfortunately, courts still disagree 

about whether Hall Street excludes manifest 

disregard of the law as a ground for 

setting aside an arbitration award. Some 

courts have side-stepped the issue. In Kashner 

Davidson Securities Corp. v. Mscisz, 531 

F.3d 68 (1st Cir. 2008), the court found, 

without mentioning Hall Street, that the 

arbitrators acted in manifest disregard of 

the law when they dismissed the investors’ 

“counterclaims and third-party claims 

as sanctions in contravention of explicit 

provisions” in the securities arbitration 

code. Id. at 71. On remand, the district 

court vacated the award, and remanded 

the case to the arbitral body. The court 

denied the appellant’s motion for relief 

from its remand order. The appellant again 

appealed to the circuit court. 

This time, the appellant, Kashner Davidson, 

argued that manifest disregard of the 

law was not explicitly listed as a ground for 

vacatur in section 10 of the FAA, so it was 

not a ground for vacatur, as clarified in Hall 

Street. Kashner Davidson Securities Corp. v. 

Mscisz, 601 F.3d 19, 22 (1st Cir. 2010). The 

First Circuit side-stepped those arguments, 

stating that Kashner Davidson had failed, 

on many occasions, “to raise the Hall Street 

argument through ordinary procedures.” 

Id. at 23. And the First Circuit would not 

permit Kashner Davidson to raise that 

argument “by invoking a procedural remedy 

reserved for extraordinary situations.” 

Id. 23. See also AmeriCredit Financial Services, 

Inc. v. Oxford Management Services, 

2008 WL 4371752 (E.D.N.Y. Sept. 18, 2008) 

(finding that arbitrators had not manifestly 

disregarded the law in their ruling, but that 

it may be moot anyway, after Hall Street). 

Further, the First Circuit is not the only 

circuit court to side-step whether manifest 

disregard of the law is a ground for vacatur: 

The Supreme Court has recently held 

that the provisions of the FAA are the 

exclusive grounds for expedited vacatur 

and modification of an arbitration 

award, which calls into doubt the nonstatutory 

grounds which have been 

recognized by this Circuit. However, 

because we affirm the district court and 

hold that the arbitration award is confirmed, 

there is no need in the instant 

case to determine whether those nonstatutory 

grounds for vacatur of an arbitration 

award remain good law after 

Mattel. (citation omitted). 

Rogers v. KBR Technical Servs. Inc., No. 

08-20036, 2008 WL 2337184, at *2 (5th Cir. 

June 9, 2008). 

Some courts have found that after Hall 

Street, the manifest disregard doctrine is 

no longer grounds to vacate an arbitration 

award. See Sherry Hereford v. D.R. Horton, 

No. 1070396, 2009 WL 104666 (Ala. 

Jan. 9, 2009) (“Under the Supreme Court’s 

decision in Hall Street Associates, manifest 

disregard of the law is no longer an independent 

and proper basis under the Federal 

Arbitration Act for vacating, modifying, 

or correcting an arbitrator’s award.”); Robert 

Lewis Rosen Associates v. Webb, 566 F. 

Supp. 2d 228 (S.D.N.Y. 2008) (“As the Second 

Circuit’s traditional understanding 

of Wilko and §10—that Wilko endorsed 

manifest disregard and that §10’s grounds 

are not exclusive—is inconsistent with the 

basis for the holding in Hall Street, the 

Court finds that the manifest disregard of 

the law standard is no longer good law.”); 

Ramos- Santiago v. United Parcel Serv., 

524 F.3d 120, 124 n.3 (1st Cir. 2008) (“We 

acknowledge the Supreme Court’s recent 

holding in Hall Street… that manifest disregard 

of the law is not a valid ground for 

vacating or modifying an arbitral award 

in cases brought under the Federal Arbitration 

Act.”) (citation omitted); Citigroup 

Global Mkts., Inc. v. Bacon, 562 F.3d 349, 

358 (5th Cir. 2009) (manifest disregard of 

the law is no longer an “independent, nonstatutory 

ground” for setting aside an arbitration 

award). 

Yet other courts have held that the manifest 

disregard doctrine is alive and well 

after Hall Street. See Comedy Club, Inc. v. 

Improv West Assocs., 553 F.3d 1277, 1281 

(9th Cir. 2009) (“manifest disregard of the 

law “remains a valid ground for vacatur 

for an arbitration award under §10(a)(4) of 

the Federal Arbitration Act”); Stolt- Nielson 

SA v. AnimalFeeds Int’l Corp., 2010 LEXIS 

3672 (S.C. 2010) (although the Supreme 

Court analyzed the arbitration panel’s decision 

under §10(a)(4), the court acknowledged 

the Second Circuit’s holding that 

manifest disregard survived the Supreme 

Court’s decision in Hall Street). 

In the end, defending against an action 

to enforce an international arbitration 

award requires navigating a mixture of 

international and domestic law, with a conflict 

among the federal courts sometimes 

thrown in. 

Best Jury, from page 54 

To strike for cause, the party requesting 

the strike must show clearly that a juror 

would not be able to follow the court’s 

instruction. See West v. State, 820 So. 2d 

668 (Miss. 2001); Martin v. State, 592 So. 

2d 987 (Miss. 1991); Humphrey v. State, 

759 So. 2d 368 (Miss. 2000); see also Davis 

v. State, 660 So. 2d 1228 (Miss. 1995) (dismissing 

a juror who could not set aside 

personal opinions and vote for death penalty); 

Cribbs v. State, 800 So. 2d 568 (Miss. 

Ct. App. 2001); Venton v. Beckham, 845 So. 

2d 676 (Miss. 2003) (holding that a court 

did not abuse its discretion in striking two 


jurors for cause where they failed to disclose 

the fact that they had problems with 

their bills at the clinic where the defendant 

worked since counsel had made an adequate 

inquiry of the jurors). This juror’s 

promise to be impartial in this case was 

entitled to considerable deference. Scott v. 

Ball, 595 So. 2d 848 (Miss. 1992). See also 

Lester v. State, 692 So. 2d 755 (Miss. 1997) 

(overruled on other grounds by Weatherspoon 

v. State, 732 So. 2d 158 (Miss. 1999)). 

Conclusion 

Effective jury selection techniques are 

imperative to eliminate jurors who have a 

propensity to vote against a corporate defendant 

on liability and to grant high damages 

awards, including punitive damages. 

It is important to understand the dynamics 

that drive high jury awards. Courts 

generally grant broad discretion to attorneys 

during the jury selection process. You 

should dedicate the same careful attention 

to voir dire that you dedicate to preparing 

for other aspects of trial. With adequate 

preparation and finesse, a corporate 

defense attorney can successfully impart 

themes in the jury selection process to 

uncover extreme biases, ultimately seating 

an impartial jury.

Shady Grove, from page 26 

is so intertwined with that statute’s rights 

and remedies that it functions to define the 

scope of the substantive rights. Unlike in 

Shady Grove, the limitation here is contained 

in the substantive statute itself, not in a separate 

procedural rule. The very statutory provision 

that authorizes a private right of action 

for a violation of [the statute] limits such 

claims those brought individually.”) (internal 

quotation marks and citation omitted). 

Subsequent decisions may prove that the 

In re Whirlpool and Bearden decisions and 

their reliance on Justice Stevens’s concurrence 

were an anomaly. But the reasoning 

utilized by these courts appears sound and 

is consistent with the Supreme Court’s Erie 

jurisprudence, which has suggested that 

courts should perform substantive analyses 

of potential conflicts between the Federal 

Rules of Civil Procedure and state laws, 

rather than the bright-line test proposed 

by Justice Scalia’s opinion in Shady Grove. 

Can State Court Be a 

Favorable Forum 

As a general proposition, corporate defendants 

typically prefer litigating class actions 

in federal court, particularly in those jurisdictions 

where the state courts are viewed 

as friendly forums for class action plaintiffs 

and their attorneys. Thus, often the initial 

instinct of a defense counsel facing a proposed 

class action in state court is to investigate 

the potential for removal to federal 

court based on CAFA. Even if there is the 

potential that another state’s more favorable 

laws would apply, defendants are generally 

more comfortable with the district courts 

conducting the choice of law analysis than 

the forum state’s court. The Shady Grove decision, 

however, potentially alters these considerations 

in two significant ways. 

First, plaintiffs pursing state law class 

actions that are barred in state courts now 

can turn to the federal courts to assert those 

claims in some instances. Certainly, plaintiffs 

formerly without forums to assert statutory 

penalty class actions when New York 

law applied can now turn to the federal 

courts without fear of N.Y. C.P.L.R. §901(b). 

The number of those claims filed in federal 

courts will undoubtedly rise significantly. 

While Shady Grove only addresses applying 

N.Y. C.P.L.R. §901(b) to federal court, 

the plaintiffs’ class action bar will likely eagerly 

test the breadth of Shady Grove by filing 

class action complaints that would have 

been otherwise barred or adversely affected 

by other state statutes and rules about class 

actions. As such, in light of Shady Grove, defense 

counsel should carefully consider the 

applicable state statutes that form the basis 

of state law claims to determine whether 

any of the potentially applicable states’ 

laws provide more favorable positions from 

which defendants can challenge the viability 

of class actions. If so, counsel will want 

to determine whether challenging a court’s 

jurisdiction through a removal application 

offers an advantage. An analysis will vary 

from case to case, but regardless, counsel 

will need to balance the traditional advantages 

of litigating class actions in federal 

courts with the potential for eliminating 

or otherwise adversely affecting the maintenance 

of a class actions if potential classes 

re-file the case in state courts. 

Second, for class action complaints filed 

in state courts, removal under CAFA may 

no longer hold the default position for defendants 

in analyzing the best forum. That 

is, if counsel discovers a potentially applicable 

state law that has the capacity to provide 

a more favorable disposition of a class 

action than if class issues were simply analyzed 

under Fed. R. Civ. P. 23 in federal 

court, Shady Grove suggests that defense 

counsel may want to approach removal 

more cautiously than in the past. Indeed, a 

reflex removal application could preclude 

the viability of certain defenses to a class action 

that would otherwise exist if an action 

remained in state court, including defenses 

that could bar the class action entirely. 

For example, if a potential class’ counsel 

filed a class action in Louisiana state court 

for violation of Louisiana’s Unfair Trade 

Practices and Consumer Protection Law, 

La. Rev. Stat. §51:1401 and other common 

law claims, difficult choices may confront 

defense counsel seeking removal. On the 

one hand, remaining in state court would 

bar the class claims for violation of Lou- 


isiana’s Unfair Trade Practices and Consumer 

Protection Law because that statute 

bars private right of actions from being 

filed in a representative capacity. See La. 

Rev. Stat. §51:1409. But the potentially 

class action friendly state court would consider 

the common law claims. On the other 

hand, a removal application could result in 

both claims proceeding as class claims if 

the district court rejected Justice Stevens’ 

rationale and applied Shady Grove to determine 

that Fed. R. Civ. P. 23 preempted the 

class action bar in the Louisiana law. Thus, 

a defendant would confront litigating only 

the common law claims as a class action 

in the state court, or removing to a federal 

court and potentially litigating both the 

common law claims and the claims alleging 

violations of Louisiana’s Unfair Trade 

Practices and Consumer Protection Law as 

class claims. Defense counsel would have to 

weigh the advantages of the federal forum 

against the risk of litigating the Louisiana 

Unfair Trade Practices and Consumer Protection 

Law claim as a class claim, which 

could potentially leave a defendant liable 

for treble damages and attorneys’ fees on 

a classwide basis if the plaintiffs prevailed 

and a court certified the class. See La. Rev. 

Stat. §51:1409. 

Conclusion 

Beyond its narrow holding, Shady Grove 

did little to establish a mechanism for addressing 

the tension that can arise when 

the Federal Rules of Civil Procedure are applied 

in diversity cases involving state laws 

or rules that address subjects similar to 

those in federal procedural rules. Because 

the Shady Grove decision did not result in 

a majority- approved, bright-line rule for 

courts to follow, courts appear likely to apply 

Shady Grove’s middle ground approach 

advocated by Justice Stevens, which interprets 

a federal rule with sensitivity to important 

state interests. In light of the high 

bar placed by Justice Stevens for application 

of a state procedural statute or rule that is 

in conflict with a Federal Rule of Civil Procedure, 

it appears probable that, at least for 

now, courts will err on the side of favoring 

and applying the Federal Rule of Civil Procedure 

when there is a conflict with a state 

statute or rule. What will transpire when 

the Court—with a new justice—next weighs 

in on the issue is, of course, anyone’s guess. 

With class actions, it is clear that the 

Shady Grove decision has fundamentally altered 

existing jurisprudence regarding the 

application of N.Y. C.P.L.R. §901(b) and, going 

forward, the bar to statutory penalties 

in class actions is no longer available to defendants 

in federal diversity cases in which 

New York law applies. Whether this will be 

the extent of Shady Grove’s impact on diversity 

cases involving class action claims 

based on state laws, or whether the decision 

will have broader implications remains to 

be seen. In the short term, however, the decision 

may result in an influx of consumeroriented, 

class actions into federal courts 

based on diversity jurisdiction. Conversely, 

defendants will probably adopt cautious approaches 

to attempting to remove cases filed 

in state courts in which the state laws provide 

more protection, or more obstacles for 

plaintiffs to overcome, against class action 

claims than Federal Rule of Civil Procedure 

23. The full impact of the Shady Grove decision, 

though, will remain unrealized until 

subsequent decisions from district courts 

weigh in on its application to the myriad 

of state court statutes and rules involving 

class actions. 

The Godfather, from page 57 

In addition to the altruistic reasons that 

support volunteering in the community, 

those activities have a consequent benefit 

as a source of networking and advertisement. 

By participating in charitable activities, 

you can meet many different people, as 

well as circulate your name or your firm’s 

name with a positive light. Participating in 

volunteer activities may also go a long way 

to slowly but surely improve the always tarnished 

public image of attorneys. 

“…a man who doesn’t spend time with 

his family can never be a real man.” 

Don Corleone to Johnny 

Fontaine in The Godfather 

While the demands and pressure to bill an 

exorbitant number of required hours, or to 

spend many hours developing plaintiffs’ 

cases, are great in the practice of law, no one 

can replace missed moments with his or her 

family. Many an experienced attorney with 

grown children has lamented the missed 

moments when their children were infants 

or toddlers, or the times that they could not 


make a little league game or recital because 

they were so engrossed with the practice of 

law. Life is short, and there are no second 

chances to recover priceless moments. 

Whenever possible, seek a balance 

between work and life outside of work, 

and encourage others to seek it. It can be 

said that attorneys who develop their life 

outside of the practice of law, particularly 

with their families, but also through hobbies, 

recreational activities, and exploring 

creative outlets, are more productive when 

it comes to work than those who do not. 

Obviously, practicing law is an extremely 

stressful, 24/7 profession. Some attorneys 

proudly, and sadly, boast that they rarely take 

time off from work. Such an attitude may 

prove counterproductive in the end. Spending 

and enjoying time with family tends to 

serve as a release from the pressures of work 

and lessen overall stress, which, in the end, 

may result in a healthy lifestyle overall. A 

healthy lifestyle, in turn, may render you a 

more productive and efficient attorney. In 

the end, all aspects of your life, both working 

and relaxing, will have benefits. 

Conclusion 

Understanding the universal principles 

enunciated by the great characters in The 

Godfather trilogy and applying them to 

your practice can improve your abilities 

and may also ease some of the stress generated 

in the profession. All in all, given 

the demands of the practice of the law, 

attorneys should make efforts to deal with 

each other in an objective and professional 

manner without descending into personal 

animosity and attacks. Ideally, we should 

treat others as we desire others to treat us, 

maintaining positive arguments supported 

by the law and facts of cases, as opposed 

to attempting to pursue or defend claims 

through negative and emotionally charged 

tactics or personal attacks. In the words of 

Clemenza from The Godfather, we should 

metaphorically, “Leave the gun. Take the 

cannoli.” In the end, by leaving behind a 

negative or personal handling of files and 

instead taking a positive, businesslike 

approach to all cases, the practice of the law 

as a whole will benefit.

Medicare, from page 34 

life expectancy information, the insurer’s 

payment history on the claim, and all other 

documentation that Medicare deems helpful 

in determining whether its interests 

were reasonably considered. 

Will the new requirements ultimately 

change the process by which defendants pay 

claims In recent years, many insurers have 

placed both a claimant’s name and Medicare 

on a settlement check, which has left 

the claimant and his or her attorney with 

the responsibility of having Medicare endorse 

the check. The carrier assumes that 

this process, which imposes a terrific burden 

on a claimant and his or her attorney, 

ensures that the insurer has met its obligation 

to Medicare since Medicare must sign 

off before the claimant can cash the check. 

Those insurers who like to wear a “belt with 

suspenders” take it even further, agreeing 

on settlements in principle, but requiring 

some written verification by Medicare, provided 

by the claimants or their attorneys, 

demonstrating that no reimbursement obligation 

exists, or that it has been satisfied. 

However, recently attorneys have started 

challenging this strategy, pointing out that 

the manner of payment is a material condition 

of a settlement, which if not agreed to 

by both sides, can lead to further litigation 

to modify settlement agreements or, specifically, 

to enforce those provisions absent a 

Medicare check endorsement. Tomlinson v. 

Landers, No. 3:07-cv-1180-J-TEM, 2009 WL 

1117399 (M.D. Fla. Apr. 24, 2009). 

Indeed, on this point, Medicare’s intent 

is clear: Medicare wants its interest satisfied 

in a settlement before distribution to 

a claimant or an attorney. Medicare states 

that insurers should not disburse settlement 

proceed to claimants or attorneys 

until Medicare’s interests have been satisfied 

in full. Ctrs. For Medicare & Medicaid 

Servs., Medicare Secondary Payer Manual 

§50.4.1, available at http://www.cms.gov/ 

manuals/downloads/msp105c07.pdf. The timing 

of such satisfaction can cause a practical 

problem: where an insurer is not willing to 

settle absent proof Medicare has been reimbursed 

first, and Medicare will not issue 

its final demand until the case has settled, 

a stalemate takes place. That is because 

Medicare’s final demand creates a sum 

certain reimbursement, which the Medicare 

Secondary Payer Recovery Contractor 

does not issue until settlement information 

is provided. 

The authors believe that the stalemate 

can be broken if insurers’ attorneys can confirm 

that claimants’ attorneys’ firms have 

in place formalized processes to identify, 

verify, and resolve Medicare claims early 

through case management procedures, insurers 

can avoid putting Medicare’s name 

on checks or asking for proof that Medicare’s 

interests have been satisfied as precautionary 

measures Identifying, verifying, 

and resolving Medicare claims early will allow 

claimants’ attorneys to (1) demonstrate 

to RREs that they reported cases timely to 

the CMS’ Coordination of Benefits Contractor; 

and (2) provide the RREs with the 

data that was already reported to the benefits 

contractor, to ensure that it comports 

with the RRE’s data reporting, as well as the 

most current, conditional- payment summary 

so that the only remaining step is to 

secure the final demand by presenting the 

Medicare Secondary Payer Recovery Contractor 

with the settlement details. Integrating 

an RRE’s procedures with those of 

a claimant’s counsel will only serve to protect 

that RRE from the penalties associated 

with Section 111 reporting. If undertaken 

properly, this collaboration can yield great 

efficiencies and protection throughout the 

settlement process, eliminating the need to 

add Medicare to a settlement check, which 

does not satisfy an insurer’s reporting obligations 

in the first place. 

Issues for Settling Parties’ Counsel 

Medicare’s role in settlements is undeniably 

evolving. As most claimants’ attorneys already 

understand, everyone must now implement 

formal procedures in their practice, 

and they cannot wait to receive a notice of 

a potential claim from the CMS before taking 

action. The agency is not required to give 

notice, so lawyers must proactively identify, 

verify, and satisfy Medicare’s interests before 

distributing settlement proceeds. 71 

Fed. Reg. 9466-01 (Feb. 24, 2006). 

For those practitioners representing 

claimants who have not yet created solid, 

internal protocols, this new law places 

greater importance on making sure that 

an appropriate Medicare verification and 

resolution strategy is fully integrated into 

their practice. The facets of a successful 

strategy include protocols for starting 

early, enhancing client- intake information, 

offering client- education modules, 

and for complex cases, perhaps changing 

retainer agreements to allow an attorney to 

seek outside assistance to handle lien verification 

and resolution. 

For those practitioners representing insurers 

and other RREs, a claimant’s obligations 

to “verify and resolve” will be 

complemented by the insurer’s new obligation 

to verify Medicare entitlement, provided 

that the claimant has representation. 

In the case of an unrepresented claimant, the 

necessity to verify and resolve becomes more 

imperative. In those cases, insurers should 

implement a protocol to seek assistance to 

ensure proper compliance with the MSP 

rules, including satisfaction of conditional 

payments. Simply put, given the impact of 

Section 111 of the MMSEA, a RRE’s mandatory 

duty to verify Medicare entitlement by 

electronically reporting to the CMS may not 

be enough to properly address Medicare’s recovery 

interest when a plan has made conditional 

payments. In that case, an insurer’s 

best response may involve outsourcing to a 

qualified lien resolution firm to ensure absolute 

Medicare compliance. 

Neutral Assistance for the Parties 

The notion of seeking outside assistance for 

lien resolution is relatively new, yet it does 

serve a good purpose. Claimants’ attorneys 

are keenly aware that they struggle to 

keep up with the changing health-care regulations, 

protocols, and contractors associated 

with the liens competing for a “share” 

of their client’s recovery. Many believe 

that their clients’ interests are best served 

if an attorney’s time and efforts are spent 

addressing damages and liability. With 

the MMSEA, defense attorneys now share 

these same concerns. 

For example, the authors’ firm, serving 

as a neutral party, has developed programs 

for parties, including those involved in asbestos 

and product liability settlements, 

which involve a protocol that the parties 

agree to adhere to. At the time of a settlement, 

or similar negotiation a plaintiff presents 

to the defendant a form that shows that 

a tort recovery record has been established 

with Medicare. Then, the defendant releases 

settlement proceeds to the plaintiff with an 

understanding that the plaintiff will hold 

all net settlement proceeds until a condi- 


tional payment summary report has been 

received from Medicare or its lead contractor. 

Once the conditional payment is received, 

in many cases, the parties agree to 

hold back a percentage of the settlement, 

based on conditional payment amounts 

and other available medical expense information, 

which they have used to determine 

the scope of conditional payment liability. 

Those funds are held until a final demand is 

received from Medicare and the reimbursement 

claim is paid in full. Then, the plaintiff 

provides the defendant with a copy of the 

final payment sheet or other proof of satisfaction 

to permit the parties to close their 

files, as has Medicare. Of course, a disbursement 

program could take multiple forms. 

But the point is that using a neutral to verify 

these steps has proved successful in identifying 

respective duties and obligations of 

settling parties and resolving those obligations 

to protect settlement programs and 

the participating plaintiffs and defendants. 

Conclusion 

As discussed above, the MMSEA impacts 

insurers. The new reporting requirements 

are designed to close the MSP reporting 

loop, ensuring that claimants and their 

counsel alike have satisfied their obligations 

to verify and resolve Medicare’s conditional 

payment reimbursement claim 

interests. At the same time, the new reporting 

requirements have sharp teeth, with a 

$1,000 per day per beneficiary penalty for 

noncompliance. And, the MMSEA also 

allocates $35 million towards assisting the 

CMS in its compliance activities, which the 

CMS has been using, in part, to fund regular 

town hall teleconferences, websites 

updating, and increasing communications 

concerning Medicare compliance. 

Undeniably, lien resolution is no longer 

an administrative function that attorneys 

can address on the back end of cases. Nor 

is it any longer a subject that parties can 

address simply with an indemnification 

clause. Rather, lien resolution has evolved 

over the last several years into one of the 

most demanding preconditions in a settlement 

agreement, often requiring counsel 

to affirmatively notify Medicare and Medicaid, 

in the case of dual-entitied beneficiaries, 

depending on state notice statutes, of 

claimants who are settling their cases, and 

then proactively to satisfy those agencies’ 

interests before disbursing settlement proceeds 

to those claimants. 

In light of the MMSEA, claimants, defendants, 

and insurers must communicate and 

cooperate to make sure that the MMSEA 

does not add yet another disruptive layer 

to the already complex, dense, and timeconsuming 

settlement process. With all 

settlement- related Medicare issues, a proactive 

rather than reactive approach yields 

a better result. Integrating claims procedures 

to verify entitlement with claimants’ 

attorneys, if any, with existing procedures 

to verify and resolve those subrogation 

issues will insulate the settling parties from 

the potentially harsh realities of today’s 

MSP program. 

It is equally important to keep from falling 

into a hysterical trap of believing that 

the MMSEA does more than add a reporting 

requirement for insurers and other 

RREs. The statutory history and recent 

CMS guidance does not bear out the premature 

and incorrect missives that the new 

reporting obligations means Medicare setasides 

are required under the law due to 

Section 111 of the MMSEA. Instead, if parties 

focus on compliance through collaboration 

on the reporting end, and analyze 

cases to identify and quantify Medicare’s 

interests under the law through formalized 

processes, including implementing standard 

operating procedures based on CMS 

guidance, you can settle your cases with 

confidence that Medicare’s recovery interests 

have been properly addressed without 

worries that your clients will face double 

damages and penalties. 

However, given the lead time needed to 

gather the required information, the parties 

need to start earlier in the settlement 

process. That is the true meaning of Section 

111 of the MMSEA. Simply put, if you 

know you are going to have to deal with it 

in the end, why not start addressing it in 

the beginning 

Think Globally, from page 82 

economist James Heckman in the W.R. 

Grace asbestos bankruptcy. In short, Heckman’s 

report accurately blasts the bankruptcy 

court “liability estimation” process 

as having virtually nothing to do with science. 

Answers to FAQ Regarding Asbestos 

Bankruptcies, GlobalTort, (May 12, 

2009), http://www.globaltort.com; then follow 

“Archives”; then follow “May 2009” (last 

visited Aug. 11, 2010). My personal view is 

that the Chapter 11 process has proved to 

be deeply flawed when used to resolve tort 

claims. Myriad reasons for that conclusion 

are set out in posts on my blog, GlobalTort, 

http://www.globaltort.com. 

BP’s problems illustrate why future 

crossborder mass tort claims apparently 

will be resolved by multiple tracks 

of roughly parallel claiming processes. 


Claimants may be able to recover from the 

private trust funds or later, bankruptcy 

trusts, and through litigation in federal or 

state courts in the United States, plus local 

or national courts of other nations. Hopefully, 

the BP disaster will be the tipping 

point that will spur countries to build new 

legal constructs to effectively connect and 

manage intersections among some or all of 

these parallel systems. 

There are many reasons to build connections 

among the parallel systems. For one, 

connections are needed to create an effective 

means to allocate fault among multiple 

defendants or to allow, when warranted, 

offsets for payments received in each of the 

claiming systems. Connections among parallel 

systems also could usefully help coordinate 

when and how to apply science in 

mass disaster cases to determine “liability 

estimates,” identify long-term, adverse 

health impacts, and assess the value of current 

or future medical monitoring. 

Serious attention also is needed for other 

issues. They include: 

• How to reasonably provide effective due 

process notice in multiple languages and 

forums, 

• How many “futures representatives” are 

needed to really protect the interest of 

diverse future claimants, 

• How these cases can be managed in a 

way that respects and applies the laws 

of multiple nations in these cases, and 

• How to ensure that applicable insurance 

does not disappear though policy commutations 

or insurer shut-down statutes, 

including the aptly named “schemes of 

arrangement” commonly used in the 

United Kingdom by insurers.

Data Transfers, from page 72 

In Volkswagen, A.G. v. Valdez, 909 S.W.2d 

900 (Tex. 1995), a product liability action, 

the plaintiff sought production of Volkswagen’s 

corporate telephone directory, arguing 

that the information was relevant to identifying 

employees who may have had information 

about alleged defects. The defendants 

asserted that such production would violate 

the German Federal Data Protection 

Act. After balancing the interests under Restatement 

§442, the court held that Volkswagen’s 

“corporate phone book should not be 

produced in contravention of German law.” 

Discovery Allowed Despite 

European Data Protection Laws 

On the other hand, federal district courts 

in the United States have ordered the production 

of documents that would cause 

the respondents to violate European data 

protection laws. In Weiss v. National Westminster 

Bank, PLC, 242 F.R.D. 33 (E.D.N.Y. 

2007), victims of a terrorist attack in Israel 

sued a British bank, alleging that the bank 

aided and abetted activities of a foreign terrorist 

organization. The plaintiffs requested 

the bank to produce documents related 

to certain bank accounts and activities, 

such as bank statements, wire transactions, 

deposits slips, and correspondence. 

The bank objected to the requests on the 

grounds that they sought disclosure of 

information governed by British bank customer 

secrecy laws and the UK Data Protection 

Act of 1998. The court’s analysis 

was limited to the bank secrecy laws; however, 

the principles discussed concerned 

data protection laws in general. First, the 

district court explained that Rule 44.1 of 

the Federal Rules of Civil Procedure states 

that “[a] party who intends to raise an 

issue concerning the law of a foreign country 

shall give notice by pleadings or other 

reasonable notice.” However, “[o]nce a discovery 

motion is made, the objecting party 

faces a higher burden ‘of demonstrating 

that such law actually bars the production 

or testimony at issue.’” To meet this burden, 

the party “‘must provide the Court 

with information of sufficient particularity 

and specificity to allow the Court to 

determine whether the discovery sought is 

indeed prohibited by foreign law.’” 

The district court also looked to the factors 

in the Restatement §422 and those 

articulated by the Second Circuit. The 

court rejected the bank’s argument that 

the plaintiffs could obtain the information 

under the Hague Convention. Additionally, 

the court found that the British and 

American interests in combating terrorism 

outweighed the interest in preserving 

the bank customer’s privacy. Finally, noting 

that “[b]ad faith and dilatory tactics 

will weigh against the objecting party,” the 

court found that the bank demonstrated 

good faith in its attempts to contact its customer 

for consent to comply with the discovery 

orders. However, the efforts did not 

tip the balance in the bank’s favor. 

In Columbia Pictures Industries v. Bunnell, 

245 F.R.D. 443 (C.D. Cal. 2007), the 

Central District of California Court held 

that the defendants “failed to meet their 

burden in establishing that the Netherlands’ 

[data protection] law would prohibit 

retention of the Server Log Data or production 

of an encrypted, anonymous version 

of that data to Plaintiffs” because the law 

only prohibits the production of “identifying 

information.” Additionally, the court 

reiterated the principle stated in Aerospatiale, 

that even if production did violate 

the Netherlands law, the U.S. court still 

had jurisdiction to order the party to produce 

the evidence. 

Thus, under Bunnell, the transfer of data 

from the EU in anonymous or redacted 

form did not violate data protection principles. 

See Council Directive 95/46/EC, at 

33 (“the principles of protection shall not 

apply to data rendered anonymous in such 

a way that the data subject is no longer 

identifiable.”). However, does the predicate 

act of reviewing documents for redaction, 

or “anonymizing” personal data, violate 

the council directive’s restrictions on processing 

This issue arose in R. v. Department 

of Health, ex parte Source Informatics 

Ltd., [2000] All E.R. 786 (CA). The question 

was whether the disclosure of anonymous 

prescription data by pharmacists violated 

Council Directive 95/46/EC. General Med- 


ical Council, an intervening party, argued 

that “the Directive can have no more application 

to the operation of anonymising 

data than to the use or disclosure of anonymous 

data.” The court agreed on the basis 

of “common sense and justice alike.” As 

noted in Bunnell and Source Infomatics, 

transferring anonymous data does not violate 

the Directive, nor does redaction violate 

the processing restrictions. 

The interaction of EU data protection 

laws and discovery obligations facing litigants 

in U.A. courts is an evolving landscape 

without clear boundaries. Solutions 

and “work-arounds” are developing, but it 

remains unclear how effectively they will 

manage the inherent friction between the 

European and American legal frameworks. 

Conclusion 

Virtually all data related to a European 

individual, or that identifies or may identify 

an individual, are subject to farreaching 

data protection laws of one or 

more EU member states, and improperly 

collecting, processing, transferring, maintaining, 

using, or even viewing of that data 

can subject an individual, business, or 

counsel to significant monetary fines and 

even criminal prosecution. The application 

of Europe’s data protection Directive, 

Council Directive 95/46/EC, the roles of the 

European data protection authorities, and 

best practices for avoiding breaches of the 

data protection laws are still being defined. 

In implementing data management systems 

and attempting to comply with the 

broad scope of discovery under the Federal 

Rules of Civil Procedure, companies may 

find themselves at odds with the stringent 

EU laws that restrict processing and transferring 

personal data. One thing, however, 

appears quite certain: those doing business 

in Europe or with European affiliates need 

to have a clear, working knowledge of the 

relevant legal principles, as well as the very 

broad scope of information to which those 

principles apply. 

Cross Border, from page 67 

the New York Times case for violations of 

personal rights are difficult to apply. Many 

questions remain unanswered. Which publications 

other than the New York Times are 

internationally acknowledged newspapers 

What if a violation takes place not in the online 

edition of a newspaper or a magazine, 

but on a company website Would a court 

then consider whether the company website 

is an internationally acknowledged website, 

or would it be sufficient if the company were 

internationally known or renowned What 

if only one user from Germany registered 

with the website Would that one registered 

user from Germany have to know the plaintiff 

for the case to become appropriate for 

German court jurisdiction 

In any event, Internet website content 

providers should apply reasonable care 

to the contents that they publish online. 

If an online publication mentions a foreign 

national or a foreign company, a content 

provider should understand that it 

may find itself in court as a defendant in 

that particular country. An Internet content 

provider should take into account that 

the standards of freedom of speech vary 

broadly all over the world. What may be 

protected speech in the United States may 

constitute a violation of personal rights 

elsewhere. Even if it turns out later that a 

claim has no merits, facing litigation in a 

foreign country is always uncomfortable 

and costly. 

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Writers’ Corner, from page 81 

anymore. Yet the most pervasive reason is 

likely the continuing breakdown of shared 

references in our increasingly diverse culture. 

Whatever the reason, whenever I 

try an allusion, it crashes as will a lead 

zeppelin. 

Despite the restrictions, advocates 

should employ every available technique to 

make their briefs less tedious. These techniques 

include (1) using parties’ names, 

(2) placing characters in dramatic conflict, 

(3) telling a story with a plot that builds to 

a resolution, (4) inserting appropriate figures 

of speech in an argument, (5) writing 

clear sentences of varying lengths, and 

(6) ensuring that every word is carefully 

chosen, as in Madame Bovary, so that no 

word is wasted. But, regardless of their talent, 

advocates should not expect that they 

will be nominated for the Nobel Prize in 

Literature simply by writing briefs. Even 

the best briefs will be too boring for that. 

 


Robson Forensic 

Specialty Expertise 

Aquatics & Drowning 

Maria K. Bella, AFOIT, CPOI, LGI 

mbella@robsonforensic.com 

800.813.6736 

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Matthew D. Lykins, A.P., I.A., D.M.E. 

mlykins@robsonforensic.com 

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Timothy M. Wilhelm, CFEI, CVFI 

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Fuel Gas Systems 

Ronald J. Natoli, P.E. 

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Hazardous Materials 

Michael D. Klein, P.E., CHMM 

mklein@robsonforensic.com 

843.722.0119 

Security & Police Practices 

Donald J. Decker 

ddecker@robsonforensic.com 

800.695.3139 

Supervised Care 

Lisa A. Thorsen, M.S., S.D.A., C.R.C. 

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These are our experts and we stand behind their work. Contact an expert directly to discuss your case. 

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Engineers, Architects, Scientists & Fire Investigators

A D V O C AT E S A N D N E W M E M B E R S 

Each month, DRI welcomes new members from the United States and Canada and abroad. Some of these new 

members have been recommended by current members actively involved in advancing goals shared by DRI. Any 

individual who recommends a new member is recognized as an “Advocate” for DRI. 

Advocates 

Brent D. Anderson, 

Denver, CO 

N. Larry Bork, Topeka, KS 

Susan H. Briggs, 

Charlotte, NC 

Sarah Fry Bruch, 

Milwaukee, WI 

C. Paul Cavender, 

Birmingham, AL 

Christopher Vincent Cotton, 

Kansas City, MO 

Kieran Cowhey, 

Dublin, Ireland 

John E. Cuttino, Columbia, SC 

Michelle Thurber Czapski, 

Detroit, MI 

Christopher P. Deters, 

Charleston, SC 

Robert L. Fanter, 

Des Moines, IA 

Dieter Hofmann, 

Zurich, Switzerland 

Louise A. Kelleher, 

New York, NY 

Linda M. Lawson, 

Los Angeles, CA 

Christopher P. Leritz, 

Saint Louis, MO 

James R. Nieset, Jr., 

New Orleans, LA 

Leslie C. O’Toole, Cary, NC 

William Joseph Pickard, 

Tulsa, OK 

Mark E. Richardson III, 

Research Triangle Pk, NC 

Would you like to see 

your name in print 

Theodore F. Roberts, 

Towson, MD 

Brett A. Ross, Birmingham, AL 

Richard T. Saraf, Buffalo, NY 

Robert P. Scott, Jr., 

Houston, TX 

Jud C. Stanford, 

Birmingham, AL 

Howard F. Strongin, 

New York, NY 

Sara M. Thorpe, 

San Francisco, CA 

Carmen R. Toledo, 

Atlanta, GA 

Michael B.T. Wilkes, 

Spartanburg, SC 

Scott P. Yount, Tampa, FL 

New Members 

Alabama 

Robert Andrew Feeley, 

Birmingham 

Allan R. Wheeler, Birmingham 

Arkansas 

Carol N. Ricketts, Little Rock 

California 

Zachary Brown, Los Angeles 

Scott Voelz, Los Angeles 

Susan E. Kirkgaard, 

Sacramento 

Carleigh L. Gold, San Diego 

Colorado 

William R. Landis, Denver 

The DRI Advocate Campaign 

(aka Member Get a Member) 

DRI members (except Officers and Board 

members) who recruit new full dues paying 

members receive a $100 fully transferable 

discount coupon for each such member recruited. 

Coupons are redeemable at DRI seminars and the 

Annual Meeting. Coupons may be combined for a 

given seminar or the Annual Meeting. Individual 

discount coupons are valid for two years from 

the date of issue. There is no limit to the number 

of coupons an advocate can accumulate. The 

advocate’s name MUST appear on the “referred 

by” space provided on the application. 

Ben Meade, Denver 

Amanda Webb Wiley, Denver 

Connecticut 

Nathan Zezula, Stamford 

District of Columbia 

Nicholas Thomas Moraites, 

Washington 

Florida 

Roland Sanchez-Medina, Jr., 

Coral Gables 

Florida 

Adam J. Kopman, 

Daytona Beach 

Kellie Nicole Kagan, 

Jacksonville 

Sharon Duncan, Orlando 

Robert A. Fleming III, 

Panama City 

James Lory King II, 

Tallahassee 

Jerry L. Rumph, Tallahassee 

Georgia 

Yoon J. Ettinger, Atlanta 

Thomas B. Ward, Atlanta 

Idaho 

David E. Dokken, Lewiston 

Illinois 

Barbara G. Taft, Bloomington 

Raymond Lee Asher, 

Chicago 

Jeanne M. Cullen, Chicago 

Traci Gill, Chicago 

Laura Lally, Libertyville 

Indiana 

J. Blake Hike, Fort Wayne 

Valerie Brooker, New Albany 

Iowa 

Amos E. Hill, Des Moines 

Kansas 

Cody G. Robertson, Topeka 

Dan Lawrence, Wichita 

Louisiana 

Eleanor W. Wall, 

Baton Rouge 

Ralph J. Aucoin, Jr., 

New Orleans 

Rebecca Y. Cooper, 

New Orleans 

Nancy Cromartie, 

New Orleans 

Randall C. Mulcahy, 

New Orleans 

Maryland 

Angela Ruocco, Towson 

Massachusetts 

Kathleen E. Kelly, Boston 

Michigan 

Nicole Wotlinski, Detroit 

Mississippi 

David B. Estes, Gulfport 

Missouri 

Angela M. Higgins, 

Kansas City 

Christopher D. Baucom, 

Saint Louis 

Peter N. Leritz, Saint Louis 

Pamela J. Meanes, 

Saint Louis 

Nevada 

Richard I. Dreitzer, Las Vegas 

New Jersey 

Christina Silva, Roseland 

New Mexico 

Richard E. Hatch, 

Albuquerque 

New York 

Thomas E. Liptak, Buffalo 

Martin M. Adler, New York 

Michelle K. Aiena, New York 

Mary Beth Forshaw, 

New York 

Philip Y. Kouyuoumdjian, 

New York 

Ron Kurzman, New York 

Frank J. Giliberti, Uniondale 

North Carolina 

James M. Weiss, Cary 

Charles J. Bridgmon, 

Charlotte 

Ohio 

James D. Houston, 

Cincinnati 

Stuart D. Baker, Cleveland 

Oklahoma 

Eric L. Clark, Tulsa 

Pennsylvania 

Joseph A. Arnold, 

Philadelphia 

Lauren Nonnemacher, 

Philadelphia 

South Carolina 

Steven D. Epps, Charleston 

Nosizi Ralephata, Charleston 

Manton M. Grier, Jr., 

Columbia 

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Spartanburg 

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William H. Haltom, Jr., 

Memphis 

Texas 

Janice Byington, Austin 

C. Mark Stratton, Austin 

Ashlea W. McCathern, Dallas 

Suzanne R. Chauvin, 

Houston 

George Edwards III, Houston 

Wil-Jeanne Eugene, Houston 

Jack W. Higdon, Houston 

Tara K. Kelly, Houston 

Carol M. Wood, Houston 

Jared M. Moore, Midland 

Virginia 

Brenda Rodriguez- 

Howdershell, Fairfax 

Washington 

Karen A. Kalzer, Seattle 

Kimberly A. Kamel, Spokane 

West Virginia 

Ashley L. Justice, Beckley 

Wisconsin 

Ryan Burke, Madison 

Timothy D. Edwards, 

Madison 

Sara Catherine Mills, 

Milwaukee 

Austria 

Nikolaus Pitkowitz, Vienna 

Canada 

Ian D. MacKinnon, 

Abbotsford, British Columbia 

Fatima M. Vieira, 

Toronto, Ontario 

Ireland 

Rachel Halligan, Dublin 

Paul Kennedy, Dublin 

Switzerland 

James T. Peter, Zurich 


A lot of groups toss around terms like “best in class,” 

“one of a kind,” and “superior.” But only one can say 

“for the defense bar.” 

Best in class, one of a kind, superior education for the 

defense bar professional. 

DRI Seminars. 

w w w . d r i . o r g

Positively 

Herculean 

Networking 

Special 

Events at 

DRI’s 2010 

Annual 

Meeting 

DRI's 2010 Annual Meeting offers attendees a variety of networking and social events 

to complement the array of educational offerings you'll find this fall in San Diego. 

Thursday, October 21, 12:00–1:30 PM 

Awards Luncheon with Matt Miller 

Each year DRI presents its top honors at a luncheon during the Annual 

Meeting. Join your colleagues and celebrate those individuals who are being 

recognized for their achievements. Enjoy a presentation by Matt Miller, author, 

columnist, radio host and consultant whose work focuses on agenda-setting 

ideas and creative problem-solving in the public, private and nonprofit 

sectors. Mr. Miller is a senior fellow at the Center for American Progress, a 

columnist for The Daily Beast and Washington Post, a contributing editor at 

Fortune, and the host of Left, Right & Center, public radio’s popular political week-inreview 

program. 

Thursday, October 21, 7:00–10:00 PM 

Off-site Networking Reception Aboard the USS Midway Museum 

Explore a floating city at sea and relive nearly 50 years of 

world history aboard the longest-serving Navy aircraft 

carrier of the 20th century—an unforgettable adventure 

for the entire family. You won’t want to miss this 

wonderful evening exploring history at its best and 

enjoying delicious food and drink. Dance to Atomic 

Groove, one of San Diego's top dance/variety/showbands, 

with impressive musical expertise in sophisticated jazz, 

treasured soul, classic rock, and dance jams from the 60s to 

today, delivered with enthusiasm, credibility, and a distinctive, ever-evolving i personality. 

Saturday, October 23, 6:30–10:00 PM 

President's Gala and Installation Ceremony 

The President's Gala and Installation Ceremony is an evening devoted to excellent 

food, wine and stimulating conversation with your friends and colleagues. In 

addition, the DRI Public Service Committee will host its First Annual Silent 

Auction with proceeds benefitting the National Foundation for Judicial 

Excellence (NFJE). Among the fabulous items you may bid on early and often: 

■ Four tickets to a Red Sox baseball game at Fenway Park during the 2011 

season. Premium seats behind home plate—Field Box Home Plate 44, 

Row C, Seats 1-4. [Donated by the law firm of Nelson Mullins Riley and 

Scarborough LLP] 

■ Two-night stay with breakfast for two plus a day of sailing on Lake 

Pontchartrain. [Donated by the Sheraton New Orleans and DRI Board 

Member Bruce Cranner] 

■ America’s hottest new electronic toy—an iPad (16GB with Wi-Fi). 

[Donated by NFJE Board Member Peter J. Hersha] 

■ Two tickets to the New England Patriots vs. San Diego 

Chargers game Sunday, October 24 at 1:15 p.m. Pacific Time, the 

Sunday of the DRI Annual Meeting. The seats are located in the 

Lower Level (Plaza Level), Section 57 (corner end zone), Row 

14. [donated by the DRI Professional Liability Committee] 

To view additional auction items visit www.nfje.net, 

or for information on donating items, please 

contact Tiffany Caldwell at 312.698.6230 

or nfje@nfje.net. 

Save $200 

when you 

register by 

September 22! 

Visit www.dri.org to register online 

and to learn more about the meeting, 

or call 312.795.1101.

For The Defense, September 2010 - DRI Today

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