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He Supreme Court’s business docket for fall reads like a tort reformer’s playbook; it includes cases on excess punitive damages and class action litigation that could turn the upcoming months into a landmark term. But the tort cases are leavened with intellectual property suits that will bring other books into play, ranging from Charlotte’s Web and The Cat in the Hat to the Victoria’s Secret catalog. In short, the Court’s business agenda is the kind of mix that former solicitor general Kenneth Starr forecast several years ago when he complained about the excessive influence of law clerks: cases the Court must hear, plus a handful of more titillating issues that the clerks’ recently-out-of-law-school minds cannot resist. State Farm Is There The biggest tort reform case on the docket is State Farm Mutual Automobile Insurance Co. v. Campbell. It’s a challenge to a Utah jury’s $145 million punitive damages award that was reinstated by the Utah Supreme Court after being reduced to $25 million by the trial judge. The eye-popping jury award came after a trial in which evidence was introduced of widespread bad-faith claims handling by State Farm. In the case that led to the jury trial, policyholder Curtis Campbell was sued for negligently causing an accident that resulted in the death of another driver. State Farm refused to settle the case, exposing Campbell to a jury verdict that exceeded his coverage and threatened to leave him penniless. Campbell sued State Farm and, in addition to evidence about the company’s misconduct in other states, demonstrated the financial health of the insurer. The jury found in favor of Campbell and awarded $2.6 million in compensatory damages and $145 million in punitives. The judge lowered the damages to $1 million in compensatory and $25 million in punitives, but the Utah Supreme Court reinstated the award, ruling that it was justifiable in light of the wealth of the company and its misconduct in other places. State Farm brought the case to the Supreme Court, claiming that the Utah ruling violated the constitutional standard of excessiveness articulated in 1996′s BMW of North America v. Gore. Tort reform advocates have been hoping since the BMW decision that the Supreme Court would tie up some loose ends from the case and give lower courts greater guidance on what factors can and cannot go into a punitive damages award that is alleged to be excessivesuch as the alleged misconduct of State Farm in other states. “BMW painted with a broad brush and did not address with crystal clarity what role, for example, the finances of a company should play,” says Evan Tager, a partner in the Washington, D.C., office of Chicago’s Mayer, Brown, Rowe & Maw. Tager authored an amicus curiae brief in the State Farm case for the U.S. Chamber of Commerce. “We say the jury should focus on what happened in the particular case before them.” Tager thinks the State Farm case could turn out to be more important than the BMW decision. At a recent meeting of groups filing amicus briefs, Tager says that more than 50 business organizations were on hand, represented by “a veritable Who’s Who” of Supreme Court heavyweights, including former solicitors general Walter Dellinger and Seth Waxman. There’s a heavyweight on the other side of the State Farm case, tooHarvard Law School professor Laurence Tribe, who has argued several punitive damages cases from the plaintiff side. Tribe is banking on the high court’s reluctance to draw bright lines, especially in an area where states have traditionally been free to roam. “To rule that an award of this magnitude cannot be made would be akin to imposing new federal evidence rules on the states,” says Tribe. “Once they get their feet wet in this area, there is no way to wade in without drowning.” The case is likely to be argued in December or January. Vexing Venues Other tort-related cases on the fall docket relate mainly to class action litigation. In Ford Motor Company and Citibank v. John McCauley, business will be seeking yet another way to keep class actions in federal court, rather than less predictable state court venues. The litigation was brought by consumers who challenged the termination of a rebate program run jointly by Ford and Citibank. None of the plaintiffs suffered $75,000 in losses individuallythe minimum for invoking diversity jurisdiction in federal courtsbut the defendants say the minimum is triggered because the cost of defending against the claims will exceed $75,000 per plaintiff. “Business has not gotten a fair shake when it is brought in to some local courts, whether it’s Madison County, Illinois, or Mississippi,” says Steven Bokat of the National Chamber Litigation Center. A standard that looks at the $75,000 minimum from the point of view of the defendantinstead of just the plaintiffwill send more cases to federal courts, says Bokat. Cancer Concerns Another issue in class actions that will be considered by the court is the relevance of fear of future health problems in assessing damages. In Norfolk & Western Railway Co. v. Ayers, Carter Phillips, a partner in the Washington, D.C., office of Chicago’s Sidley Austin Brown & Wood, will represent the railroad. He’ll argue that rail workers who show no physical manifestation of asbestos disease should not recover damages merely because they fear they may become sick in the future. West Virginia juries have been handing out verdicts in the area of $1 million to plaintiffs who are at risk. “Asbestos litigation has put many companies into bankruptcy,” says Bokat. “There’s not enough money in the system to pay for those with disease, much less those who only are concerned about getting it.” In the area of intellectual property, the biggest case before the Court this fall is Eldred v. Ashcroft. It’s a First Amendment challenge against Congress’s authority to pass the Sonny Bono Copyright Term Extension Act in 1998. By extending the life of existing copyrights, the appellants assert, Congress violated the free speech rights of the many publishers and creators that depend on public domain works. The case brought an avalanche of briefs to the Court on both sides of the high-stakes battle. One of the more curious briefs came from the owners of the copyrights of books by the now-deceased Dr. Seuss (Theodor Geisel), E.B. White, and Ludwig Bemelmans. Invoking the titles of The Cat in the Hat, Charlotte’s Web, and Madeline, the brief by Karl ZoBell of the San Diego firm Gray Cary Ware & Freidenrich argues that copyright extension is particularly important to the children’s book industry. Many of the mainstays of children’s publishing are by long-ago authors, they assert. Without copyright protection, none of the new creations based on the old worksfrom CD-ROMs to stage productionswould be undertaken, ZoBell says. Victor/Victoria Slightly more adult reading is at stake in Moseley v. V Secret Catalogue. In 1998 Victoria’s Secret, the lingerie giantwith 750 retail stores and 400 million catalogs distributed annuallysent a cease-and-desist letter to Victor’s Secret, a store that sells adult sex paraphernalia in Elizabethtown, Kentucky. The owners of the store, Victor and Cathy Moseley, changed the small business’s name to Victor’s Little Secret. But that was not enough for Victoria’s Secret, which sued claiming, among other things, trademark dilution. The Moseleys argued that with no evidence of actual harm to the catalog company, no damages could be recovered. The U.S. Court of Appeals for the Sixth Circuit disagreed, ruling that future harm is presumed. Now the Supreme Court will decide, and within those hallowed halls, the Victoria’s Secret catalog will become required reading. E-mail:

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