Several Senators — we’ve heard Sen. Ben Cardin (D-MD) and Sen. Sheldon Whitehouse (D-RI) — have taken to the Senate floor today in anticipation of tomorrow’s vote on the DISCLOSE Act.  Sen. Whitehouse is being especially extreme in his attacks, calling the Supreme Court a “radical group,” making accusations about “corruption” and money laundering, and now claiming that the court has “opened the floodgates to foreign corporations” to “drown out American voters” and buy elections.

Not true.

Sean Parnell at the Center for Competitive Politics has been watching the Senate speeches, too, and given his detailed knowledge of the legislation and the politics involved, we’ll allow him to correct the falsehoods.

Listening to them speak, it’s become even more clear than ever that not only are the Senate advocates of the DISCLOSE Act wrong (a subjective opinion, of course, although one we can amply defend) but they are almost completely ignorant of what this legislation would do, what current law on the subject is, and what the court ruled in Citizens United.

All of the things being said that are simply factually incorrect, at least all that I heard, have been covered by us here at CCP repeatedly in the past. The plainly false statements include:

• Foreign corporations are now free to fund election ads (they aren’t)
• Citizens United overturned a 100-year old law (it didn’t)
• The DISCLOSE Act is “just” disclosure (it’s much more)

This is just a brief sampling of the transparently inaccurate statements made by Democratic Senators on the floor so far today regarding the DISCLOSE Act, and doesn’t even begin to address things like the claim that a bill that prohibits more than half the largest companies in the country from speaking without limiting a single union somehow represents a fair and even-handed treatment of the business and labor communities.

What’s so astonishing is that the Senate supporters of the bill believe (or claim to believe) that the American public wants Congress to act on this legislation, supposed campaign finance reform that is really an attack on the First Amendment.

We believe the public would prefer to see the Senate consider measures to strengthen the economy, keep tax rates under control, and improve U.S. competitiveness.

Note — 4:30 p.m. corrected the state designation for Sen. Whitehouse.

The Senate Judiciary Committee today voted 13-6 to support confirmation of  John “Jack” McConnell to be a U.S. District Court Judge for Rhode Island.

McConnell is the Motley Rice partner and campaign contributor who, with the state attorney general’s office, orchestrated the state’s public nuisance lawsuit against paint manufacturers in the hopes of earning millions of dollars in contingency fees. The Rhode Island Supreme Court eventually threw out the suit.

Cornell University law professor William A. Jacobson has been following McConnell’s nomination. He reports, “The Most Important Judicial Nomination You Never Heard Of Set For Vote Today”:

At the hearing this morning, Jeff Sessions (R-Ala.) spoke at length in opposition to the nomination. Sessions mentioned numerous instances of McConnell and his firm rewarding politicians with campaign contributions after receiving state business, and how McConnell publicly rebuked the Rhode Island Supreme Court in very unflattering terms after the Court threw out McConnell’s landmark lead paint lawsuit (which was started when Whitehouse was Attorney General).

In defense of McConnell, Sheldon Whitehouse accused opponents of McConnell of attempting to “smear” McConnell. Whitehouse, as usual, changed the subject and engaged in a lengthy lecture making it seem as if anyone who opposed McConnell was against the jury system and our entire system of justice.

John Cornyn (R-Tx) stated that he opposed the nomination, taking Whitehouse to task (my paraphrase) because while it was not necessary to be pro-business to get on the bench, it was necessary not to be anti-business.

Irritation is now sufficient cause for federal legislation.

In its Wednesday mark-up session, the Senate Commerce Committee briefly discussed and then approved S. 2847, the Commercial Advertisement Loudness Mitigation Act.

Chairman Jay Rockefeller (D-WV) described the bill and commented:

Excessively loud television advertisements may seem like a small thing, but to parents of young children, that is not a small matter, and it is distinctively obvious when advertising, all of a sudden the volume goes way up, and you have to adjust your remote control to punch it down and the program…it doesn’t make any sense, it’s unnecessary and they’re a big source of irritation for many television viewers.

This bill will help put a stop to the annoying practice of featuring television advertisements that are many times louder than television programming, and again I thank Sen. Whitehouse – not on this committee — for this bill and I’m happy to be a cosponsor.

Sen. Claire McCaskill (D-MO) commented (at the 64:20 mark in the video):

This is one of those bills that all of us have gotten letters it, all of us have experienced it. It’s one of those deals that we all want to change it, and sometimes we forget that little things are a big deal in people’s lives. We weigh really serious, weighty matters here, but especially for a senior who does not – there are people who don’t have remote controls, or don’t have access to remote control – they have to sit through and listen to the blaring of these commercials. It is beyond irritating. It just infuriates me every time they do that.

The committee clearly stopped short of the real solution — subsidized remote controls.

No, not Elena Kagan. It’s Jack McConnell, a top trial lawyer from Rhode Island who wants to serve as a U.S. District Court judge.

The Senate Judiciary Committee holds a hearing on judicial nominees Thursday, including McConnell, a partner with Motley Rice who has distinguished himself for suing tobacco companies and paint manufacturers and for being a major campaign contributor.

Forbes senior editor Daniel Fisher writes on McConnell’s candidacy in his On the Docket  column:

McConnell’s the guy who, as a contingency-fee gun for hire, pursued expensive but ultimately unsuccessful lawsuits against the paint industry on behalf of Rhode Island.

McConnell also cashed in on the biggest tort bonanza in history, the tobacco settlement. According to financial statements he filed with Congress as part of this nomination, the Motley Rice attorney anticipates “deferred compensation for work performed and completed of approximately $2.5 million to $3.1 million each year through 2024.”

The litigation against the paint manufacturers sought to pervert public nuisance law, creating through the courts a second form of all-purpose product liability law. And the state’s hiring of Motley Rice to run its lawsuit in hopes of a huge payout was a class example of the “pay to sue” business that has undermined the integrity of the U.S. judicial system. (continue reading…)

Wall Street Journal editorial, “The Pay-to-Sue Business“:

Our editorial last week on the state lawsuit racket has created a stir in Pennsylvania, where Governor Ed Rendell has finally had to defend his “pay-to-play” relationship with Houston plaintiffs lawyer F. Kenneth Bailey. That’s the good news. The rest of this underreported story is that Mr. Bailey has been running a nationwide “pay-to-sue” operation with Democratic state Attorneys General.

As we reported, Mr. Bailey made repeated donations to Mr. Rendell’s 2006 re-election campaign in the months before his law firm was given a no-bid, contingency-fee contract to sue Janssen Pharmaceuticals on the state’s behalf. Mr. Rendell told the Philadelphia Inquirer — whose reporters have roused from their slumbers — that “there wasn’t the slightest bit of pay-to-play here.” But the Governor was obliged to acknowledge that Mr. Bailey had approached the state about suing Janssen. Normally, the state Attorney General would handle such legal matters, but the AG rebuffed Mr. Bailey. Mr. Rendell’s office then decided to hire the law firm that was also his major campaign donor. Smile if you think the two were related.

Part of a big picture, a grander strategy, the WSJ explains:

It’s some racket. The plaintiffs attorneys come up with novel legal theories under which to sue companies or entire industries. They then solicit state AGs (or cash-hungry Governors like Mr. Rendell) to retain them to bring cases on behalf of the government on a contingency-fee basis. Motley Rice and Lieff Cabraser are among the firms that have targeted drug companies as well as makers of cigarettes, paint and guns.

The Rhode Island Supreme Court last year threw out the AG-hired-Motley Rice “public nuisance” suit against the paint manufacturers, but there’s still some benefit for the law firm — a federal judgeship. From Walter Olson at Point of Law, “Rhode Island: Motley Rice’s McConnell tagged for federal bench“:

John J. “Jack” McConnell Jr. of South Carolina-based Motley Rice, considered a key architect of the close alliance between the trial bar and the Rhode Island Democratic Party that led up to the state’s failed litigation against lead paint companies, has been tagged for a seat on the state’s federal district court by Sens. Sheldon Whitehouse and Jack Reed (both D-R.I.). [Providence Journal via Genova] As I noted eight years ago (see also this update from David Nieporent and this summary from Jim Copland), an investigation by Forbes found that after McConnell opened a Motley branch office in Providence, the firm quickly established itself as Rhode Island’s largest political contributor for the 2000 elections, and McConnell himself became treasurer of the state party (and a key donor ever since, including to campaigns of Reed and Whitehouse). Whitehouse (as state AG) then proceeded to hire the Motley firm to conduct the state’s much-publicized lawsuit seeking to assign the costs of lead paint cleanup to companies that produced the paint many decades earlier. That suit would have yielded enormous returns (and legal fees) had it succeeded, but in the event proved to be too drastic a stretch of legal principles for the courts to accept. For McConnell, though, at least, if not for many of the others involved, the whole episode seems to have resulted in a happy ending.

The Rhode Island Superior Court today ruled that the state must reimburse manufacturers who were forced to pay for “co-examiners” involved in development of a lead-paint abatement plan, costs pushed onto the paint companies before the R.I. Supreme Court dismissed the state’s lawsuit against them.

The latest ruling is another rebuke to the state’s attorneys general (past and present) who dreamed up this idea of suing companies under an expanded “public nuisance” theory of law, trying to shake them down for billions of dollars. The AGs hired private attorneys on contingency to pursue the litigation against the manufacturers (Sherwin-Williams Co., Millennium Holdings LLC and NL Industries.)

From the news release issued by the three defendant companies today:

“The Court got it right,” said Charles H. Moellenberg, Jr., an attorney for The Sherwin-Williams Company. “These companies should not bear the costs of litigation that the Supreme Court said should have been dismissed at the outset ten years ago. This case demonstrates that state and local governments solicited by trial lawyers to file public nuisance lawsuits should recognize that these cases are not cost-free.”

In July 2008, in a long-awaited ruling, the Rhode Island Supreme Court rejected the Attorney General’s public nuisance lawsuit filed nine years earlier against former manufacturers of lead pigment used in residential paint, saying the case should have been dismissed at the beginning. After the jury verdict, the state filed a motion seeking costs of more than $1 million. Following the Supreme Court decision reversing the jury verdict, defendants Sherwin-Williams, NL Industries, Inc., and Millennium Holdings LLC, filed a motion seeking reimbursement of $242,121.21 in costs they paid to court-appointed co-examiners whose work began before the Supreme Court reversal.

In its ruling today, the Superior Court said: “With regard to the actions taken by both parties here, as a matter of law and fairness, the Court finds little merit in the State’s suggestion that the Defendants should bear the burden of paying the Co-Examiner expenses.” The decision added: “The State made a calculated decision to pursue a claim against the Defendants and voluntarily participate in the judicial system, and thus may not invoke sovereign immunity to shield it from the imposition of costs.”

For a copy of the decision,  click here.

The ruling should send yet another message to the attorney general’s office in Ohio, which is still litigating a public nuisance claim similar to Rhode Island’s. Richard Cordray was elected last November, and he bears no responsibility for having brought the suit. He would bear the responsibility for additional legal costs if he continues the suit in the face of clear evidence it will fail in the courts.

BTW, it was former Rhode Island Attorney General Sheldon Whitehouse — now a U.S. Senator — who brought the suit against the paint companies, and current AG Patrick Lynch who continued it.

More….
Providence Business Journal, “R.I. must bear cost of lead-paint plan”
Providence Journal, “RI to reimburse lead-paint companies”
Jane Genova, Law and More blog.

UPDATE (3:15 p.m.): Genova knows the lead paint litigation and players well, and she observes: “Bad news for the RI plaintiff. This motion represented only the first of several that will likely be filed by the defendants to recover other costs and expenses associated with the nine years of litigation. Surely, this will not sit well with the taxpayers of the state.”

Last week amid all the postings on the Rhode Island Supreme Court’s ruling that rejected the state’s lawsuit against paint manufacturers, we noted the similarity of comments from Attorney General Patrick Lynch, former AG and now U.S. Senator Sheldon Whitehouse, and the contingency fee attorneys at Motley Rice who manned the legal assault (and campaign contributions): They were all acting “for the children.”

Now we see that Attorney General Lynch last month was elected to be chairman of the National Association of Attorneys General, or NAAG. (The old joke in state political circles is that NAAG stands for National Association of Aspiring Governors.)

Anyway, in the news release announcing his election, Lynch declared his goals for the year:

“I am enlisting the assistance of my colleagues and good corporate citizens, and marshalling the resources of NAAG and other organizations, to increase protections, decrease risks, and encourage a more just and secure world for our children,” Attorney General Lynch said. “Technology has created a borders-free, global society that is advantageous in many respects. But it also exposes our children to potentially dangerous influences and information, and makes them more vulnerable to those who seek to exploit, victimize, and harm them. We will continue our work in fostering a safer social networking environment and in preventing predators and other criminals from using cyberspace as their own personal playgrounds.”

Would it be too much to ask for enforcement of the law to create a more just and secure world for everybody, adults, too?

P.S. The Providence Journal prints a letter from Darren McKinney, communications director for the American Tort Reform Association, entitled, “Lynch, Whitehouse hurt R.I. economy.” Excerpt:

Lead-paint “products poisoned our infants and children — and continue to poison our infants and children — while bringing great profits to the companies that made and sold them,” Lynch said in disagreeing with the court. Yet the defendant companies had voluntarily ended sales of such products in 1955, long before 1978 government regulations required them to. Thus a reasonable person might conclude that property owners, not the former makers of then-perfectly legal products should more fairly be asked to shoulder the burden for lead-paint abatement today.

In any case, it’s no surprise that Mr. Lynch’s activist, litigious attitude, like that of his predecessor, Sheldon Whitehouse (now a U.S. senator), has helped keep Rhode Island’s rate of real GDP growth well below the national average while the unemployment rate remains considerably higher.

That’s the headline on today’s Wall Street Journal editorial marking the Rhode Island Supreme Court’s ruling in the lead paint litigation as a good day for justice.

Below we note the similarity of denunciations coming from R.I. Patrick Lynch and the attorneys as Motley Rice. Shared interests, shared rhetoric…

The lead paint as “nuisance” theory was ginned up by Motley Rice, the South Carolina firm famous for its tobacco shakedowns. The law firm found a partner in then-Rhode Island Attorney General (and now U.S. Democratic Senator) Sheldon Whitehouse, who brought the first lead nuisance suit in the country. The theory was picked up by current AG Patrick Lynch, who has worked hand-in-wallet with Motley Rice and others, dishing them a contingency contract worth 16.67% of any settlement.

Yesterday’s decision should deny them that jackpot injustice. But the cost of fighting these suits over nearly a decade has still been steep for the three paint company defendants. Sherwin-Williams Co. saw its stock plummet after the 2006 verdict, erasing about $1.8 billion in market cap, a third of its value at the time. The British “loser pays” rule is designed to deter precisely this kind of legal abuse by making the loser pay for bringing frivolous cases.

The Journal’s ending paragraph is as clear a statement we’ve seen characterizing the developments in Rhode Island:

Yesterday’s ruling is good news for paint makers and consumers, and even better news as a rebuke to the plaintiffs bar and its political patrons. Industries that make lawful products should not be held hostage to bogus legal theories whose only purpose is looting honest companies.

To avoid making a public nuisance of ourselves, here’s a list of today’s posts on the Rhode Island Supreme Court’s opinion on the state’s lead paint lawsuit.

• Twisting Public Nuisance Laws
• Finally, for More on the R.I. Ruling, Go Here
• More on Lead Paint, Almost 800 Years Worth
• Our Thoughts Turn to Cleveland, Leadenly
• The NAM’s Statement on the R.I. Lead Paint Ruling
• Statement from the Defendants in R.I. Lead Case
• The NAM’s Involvement in Rhode Island Decision
• R.I. Court Reins In Abuse of Public Nuisance Laws

And again…

• Case summary from the Rhode Island Supreme Court
• Opinion (.pdf)
• Dow-Jones Newswires: “RI High Court Reverses Ruling Against Paint Cos“
• Reuters: “Rhode Island top court overturns lead paint ruling“
• Providence Journal: “Update: Landmark lead-paint judgment overturned

The Rhode Island Supreme Court today handed down an important ruling that should discourage government officials from abusing public-nuisance statutes by stretching them into all-purpose legal weapons against whomever happens to be the target of the moment.

The court ruled unananimously in State of Rhode Island v. Lead Industries Association, Inc., et al., overturning the 2006 jury verdict that punished paint manufacturers (NL Industries, Inc., The Sherwin-Williams Co., and Millennium Holdings LLC) for violating the state’s public nuisance laws. State Attorney General Sheldon Whitehouse, now a Democratic U.S. Senator, brought the suit in 1999 and after a complicated legal process, the jury found the companies found responsible for lead paint contamination in Rhode Island homes and buildings.

We would summarize the AG’s argument this way: Some Rhode Island structures have lead paint in them, lead paint is dangerous, and even though the state can’t prove these manufacturers had anything to do with specific incidents of lead paint exposure, they’re kind of generally at fault, really. Or at least they should be. And so these bad actors should pay up for creating a public nuisance. How much? Attorney General Patrick Lynch outlined a $2.4 billion remediation plan last year to be paid for by manufacturers.

The court’s tough opinion rejects those arguments:

[We] conclude that the state has not and cannot allege any set of facts to support its public nuisance claim that would establish that defendants interfered with a public right or that defendants were in control of the lead pigment they, or their predecessors, manufactured at the time it caused harm to Rhode Island children.

In reaching this conclusion, we do not mean to minimize the severity of the harm that thousands of children in Rhode Island have suffered as a result of lead poisoning. Our hearts go out to those children whose lives forever have been changed by the poisonous presence of lead. But, however grave the problem of lead poisoning is in Rhode Island, public nuisance law simply does not provide a remedy for this harm. The state has not and cannot allege facts that would fall within the parameters of what would constitute public nuisance under Rhode Island law. As set forth more thoroughly herein, defendants were not in control of any lead pigment at the time the lead caused harm to children in Rhode Island, making defendants unable to abate the alleged nuisance, the standard remedy in a public nuisance action. Furthermore, the General Assembly has recognized defendants’ lack of control and inability to abate the alleged nuisance because it has placed the burden on landlords and property owners to make their properties leadsafe. 

Key links:

• Case summary from the Rhode Island Supreme Court
• Opinion (.pdf)

• Dow-Jones Newswires: “RI High Court Reverses Ruling Against Paint Cos“
• Reuters: “Rhode Island top court overturns lead paint ruling“
• Providence Journal: “Update: Landmark lead-paint judgment overturned