The Johnson & Johnson attorney told the U.S. House Oversight and Accountability Committee on Wednesday that the outside funding of mass tort personal injury lawsuits has transformed an entire civil court system into "a money game: that is funded, manipulated and driven by financial and legal entrepreneurs."
Oct 17 (The Justice Now) -In the written statement, J&J assistant general counsel Aviva Wein called on Congress to pass laws (or support proposed changes to federal regulations in civil cases) that require disclosure whenever outside financial institutions are backing plaintiffs. The attorney also requested lawmakers oversee the law of the litigation finance industry and stop fraudulent advertisements from generating massive tort lawsuits.
A myriad of business associations, such as the U.S. Chamber of Commerce, the National Association of Manufacturers and the Pharmaceutical Research and Manufacturers of America, saw the oversight committee’s hearing on Wednesday as an opportunity to inform Congress about what they see as the threat posed by third-party litigation financing. The groups wrote letters praising the committee’s decision to hold the hearing and supporting J&J’s call for greater oversight by Congress of the litigation finance industry. The two organizations, NAM and PhRMA, were joined by J&J in calling upon Congress to mandate disclosure from the litigation finance industry.
Based on the questions asked by both sides at Wednesday’s hearing, Congress is not in a rush to act.
This three-hour trial, titled “Unsuitable Litigation: Control on Third Party Litigation Funding,” featured testimony from Wein and a scholar in litigation finance, Maya Steinitz of Boston University, legal ethics expert Kathleen Clark of Washington University in St. Louis and people from offshore energy and Minnesota mining industries, who spoke about how the litigation of environmental groups has hindered business ventures.
A handful of Republican lawmakers, including Lisa McClain of Michigan, William Timmons and Russell Fry, both from South Carolina, posed substantive questions, specifically for Steinitz and Wein, regarding how Congress could regulate litigation funding. Timmons was one of them. He suggested that lawmakers consider applying the “loser pay” model. Other Republicans have also criticized the absence of information on the size of litigation finance and the possibility that countries such as China may be assisting in funding cases to further their geopolitical agendas.
But the oversight committee Democrats began by delivering their introduction by Jamie Raskin of Maryland, who didn’t seem interested in J&J’s claim that litigation has exploded or in the claims of the Republican co-workers that left-leaning activists had “hijacked” the federal and congressional agency power through financing “sue as well as settlement” case that create new rules on companies.
Oversight committee Democrats often defended litigation financing as a way for private plaintiffs to use the court system to prove claims against large corporations such as J&J. They criticized Republicans for claiming that mass tort defendants require help from Congress to avoid lawsuits.
“Shame for Republicans for hosting the hearing today,” added Florida Democrat Max Frost.
Illinois Representative Raja Krishnamoorthi pressed J&J’s Wein on why the company offered the $8.9 billion agreement to resolve claims from Talc plaintiffs even though their claims were unjustified. (Wein repeated her claim that J&J talc products don’t have asbestos and are completely safe. She said The settlement proposal was part of a global bankruptcy plan.)
It’s noteworthy that the sole witness requested by Democrats during Wednesday’s hearing, ethics professor Clark, was the only witness who devoted the bulk of her testimony to third-party litigation in any way; however, she focused on what she called “the ethical dilemma that’s currently confronting Supreme Court justices in the U.S. Supreme Court,” following revelations that the justices who Republicans appointed did not disclose travel expenses as well as other gifts from wealthy patrons.
Democrats who sit on oversight committees have blasted away on the subject, insisting that if there’s a “dark money” problem within civil lawsuits, it’s located on the conservative end of the political spectrum, which has seen activists support lawsuits to block legal rights to abortion as well as affirmative actions. (Indeed, in the spring of last year, the group comprised of Republican state attorneys general wrote an open note addressed to Republican lawmakers, urging them not to disclose the funders who fund litigation because of the possible adverse impact on conservatives. The letter should have been mentioned in the hearing on Wednesday.)
“Our colleagues are lost,” Raskin said in his opening remarks. “No person has the right to pay judges bribes or extravagant gratuities; however, they do have the 1st Amendment, due process and equal protection rights to get money to help make their claim in the courtroom.”
South Carolina Republican Nancy Mace, who was filling in for the committee’s chair Comer towards the end of the hearing, voiced frustration over Democrats insisting the notion that “dark cash” has stained the Supreme Court.
“How many times are the left going to talk of dark currency?” she said.
Mace continued to spend a few minutes describing the broad strokes of the oversight committee’s “dark money” accusations against Biden, the president. Joe Biden. Mace said that she’d “try to come back to the subject” and eventually called for the letters written by the business associations to be added to the records of Congress.
Her reluctance to attack Biden was instructive: Republicans on the oversight committee, as well as their colleagues in Congress Republicans, are focused on things that aren’t related to divulging third-party litigation funds.
The oversight committee could not hold any hearing focused on the purported abuses claimed in the report by J&J and its acolytes. This is a bad sign for any real legislative process.
I questioned the J&J spokesperson following the hearing whether the company considered the hearing to be productive. J&J spokeswoman said the company is “grateful for the chance to shine a spotlight” and added, “We applaud the chairman’s determination to keep investigating.”
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