The cover of the U.S. Chamber of Commerce report ()
As a Manhattan appeals court prepares to hear a challenge against a new case management order for New York City’s asbestos docket, the U.S. Chamber of Commerce’s tort reform arm has waded into the fight, arguing in a new report that the changes will tip the scales in plaintiffs’ favor.
The new case management order was set to take effect on July 20, but on the prior day Appellate Division, First Department, Justice Ellen Gesmer signed an order to stay implementation of all provisions of the new order except for the controversial reinstatement of the punitive damages option for plaintiffs.
But the authors of a report prepared for the chamber’s Institute for Legal Reform—a separately incorporated affiliate of the chamber—argue that allowing plaintiffs to seek punitive damages leads to “vastly inflated verdicts.”
The report, prepared by James Stengel, a partner at Orrick, Herrington & Sutcliffe, and C. Anne Malik, a senior associate with the firm, also takes aim at consolidation of cases in the asbestos docket, which is limited to two in the new order; and the effect of attorney advertising on asbestos cases, which they argue drives up the dollar amounts of jury awards.
But Jerry Kristal, a managing attorney for Weitz & Luxenberg’s office in Cherry Hill, New Jersey, and one of the representatives from the asbestos plaintiffs’ bar who took part in negotiations for the new case management order, blasted the report as a “crock of B.S.” that relies on defense bar-friendly publications as reference materials to back up its points and comes off as a circular argument.
“I think it shows the desperation of the their position,” Kristal said of the report.
Specifically, he said the authors of the report “liberally” cite a report by a former Delaware judge who is now a defense attorney in mass tort cases called “The Consolidation Effect,” in which she argues that consolidating cases has led to large verdicts for plaintiffs.
Stengel did not respond to messages seeking comment. Peggy Ableman, the author of “The Consolidation Effect” and special counsel to McCarter & English, did not respond to a request for comment.
Seth Dymond, a partner at Belluck & Fox and a member of the asbestos plaintiffs’ bar, said that he expects a ruling from a full First Department panel on the defense bar’s motion to enjoin the new case management order sometime in September. Manhattan Supreme Court Justice Peter Moulton, who served as coordinating judge of the asbestos docket from 2014 until June, handed down the new order as one of his final acts as coordinating judge before taking a new job as a First Department justice.
On Aug. 1, Manhattan Supreme Court Justice Lucy Billings took over as coordinating judge for the docket.
New York City’s asbestos docket has long been the target of pro-business groups like the U.S. Chamber.
For the last several years the American Tort Reform Foundation has included the New York City Asbestos Litigation on its annual report listing of what it calls the country’s “judicial hellholes.” In the latest version of that report the group claims that Weitz & Luxenberg wields significant influence over the judicial selection process and that trial judges seeking to ascend to appeals courts are careful not to cross the plaintiffs’ bar.