Toxic Tort Litigation Blog : Toxic Tort Lawyer & Attorney : Epstein Becker Green Law Firm : Product Liability, Contamination, Pollution

In GSI Commerce Solutions, Inc. v. BabyCenter LLC, No. 09-2790, the Second Circuit affirmed the ruling of SDNY Judge Jed S. Rakoff, who disqualified the Blank Rome law firm from representing a company adverse to a subsidiary of Johnson & Johnson, which was a client of Blank Rome.

The Second Circuit’s ruling is noteworthy because it addressed for the first time whether a law firm infringed on its duty of loyalty by taking on a representation adverse to an existing client’s corporate affiliate. In disqualifying Blank Rome, Judge Rakoff found that the overlap between BabyCenter LLC and Johnson & Johnson in effect made them a single company for various purposes. Judge Rakoff observed that BabyCenter LLC did not have a separate in-house legal department, but instead relied exclusively upon the in-house lawyers at Johnson & Johnson for legal advice.  Drawing upon extensive discussion by other courts as well as the ABA, the Second Circuit held that a law firm cannot take on a matter adverse to an affiliate if it diminishes the parent client’s level of confidence in its lawyers.

The Court first examined the ABA's Model Rules of Professional Conduct, which provide that a “lawyer who represents a corporation or other organization does not, by virtue of that representation, necessarily represent any constituent or affiliated organization, such as parent or subsidiary.” ABA Model Rule of Prof’l Conduct 1.7 cmt. 34 (2006). This statement embodies what is often termed the “entity theory” of representation. However, the exception to this rule is that an attorney may not accept representation adverse to a client affiliate if “circumstances are such that the affiliate should also be considered a client of the lawyer.”

For its own part, Blank Rome argued that no conflict existed because: (1) the dispute between GSI and BabyCenter involved matters unrelated to Blank Rome’s Johnson & Johnson matters; and (2) Johnson & Johnson had waived any conflict by signing Blank Rome’s engagement letter. Both of these arguments proved unpersuasive to the unanimous appeals court. In particular, the Second Circuit observed that Blank Rome’s engagement letter contained provisions that might constitute a waiver by Johnson & Johnson of some, but not all, corporate affiliate conflicts. However, these conflict waivers were specifically limited to patent litigation and, even more specifically, to matters brought by generic drug manufacturers. Therefore, the Second Circuit held, Blank Rome failed to “contract around” the corporate affiliate conflict at issue. 

In a footnote, Judge Ralph K. Winter, Jr., writing for the Court, stated that the Circuit was not addressing issues that would arise if a blanket waiver had been executed and left open how it might rule in those circumstances.

 When a scientist or physician signs on as a litigation expert, he opens himself up to scrutiny, not only about the bases for his opinion but also, to the extent permitted by law, his personal biases and professional background. In accepting a fee for service, the expert tacitly agrees to submit to intensive scrutiny. 

But what about the scientist or physician who is not involved in litigation? What privacy protections should be afforded to an expert whose scientific work becomes a linchpin for one or another party’s position in a toxic tort litigation? Increasingly, authors of scientific journal articles, FDA advisory panel members and other public health advocates have been subjected to increasingly intrusive subpoenas with the intent of undermining their scientific research or opinions. 

In a decision protective of the privacy of scientists and scholars involved in research benefiting public health and safety, New York Supreme Court Justice Sherry Klein Heitler refused to permit a company that marketed asbestos-containing products from obtaining the private papers of a former faculty member of the Mount Sinai School of Medicine (“Mt. Sinai”). Victor Reyniak and Sybille Reyniak v. Barnstead International et al. (2010 NY Slip Op. 30819)  In that case, Kentile Floors, Inc. (“Kentile”) served a subpoena duces tecum on Mt. Sinai seeking disclosure of Dr. Irving Selikoff’s private papers, including his personal correspondence and memoranda. Dr. Selikoff, who died in 1992, was a pioneering researcher in asbestos who devoted his career to enhancing public awareness of the hazards of asbestos and published over 380 scientific articles. Largely on the basis of Dr. Selikoff’s research, OSHA imposed safeguards for asbestos workers in the 1970’s. Kentile argued that Dr. Selikoff’s private papers might potentially shed light on “state of the art” issues crucial to their defense.  

In rejecting Kentile’s argument, and granting Mt. Sinai’s motion for a protective order, Judge Heitler held that the “expense Mt. Sinai would incur as a result of such a broad interpretation of the subpoena could well discourage other institutions from conducting vital health and safety research. Other scholars in the laboratory may fear that their unpublished notes, observations and ideas could be released to the public as a result of litigation. Although a scholar’s right to academic freedom is not absolute, it should factor into a court’s analysis on whether forced disclosure of documents is permissible (see, In R.J. Reynolds Tobacco Co., 136 Misc.2d supra at 287).”

Justice Heitler further held that “in  the circumstances of this case, Kentile’s request is sweeping and indiscriminate. The relative burden on Mt. Sinai to conduct such a mass production of documents covering 30 years of Dr. Selikoff’s studies outweighs any benefit Kentile might receive by conducting such a search.”

There is surprisingly scant case law  addressing the privacy concerns of scientists and physicians who find their professional work (and themselves) ensnared in litigation not of their own making.  In one case,  In re New York County Data Entry Worker Product Liability Litigation, No. 14003/92, 1994 WL 87529 (N.Y. Sup. Ct. N.Y. County Jan 31, 1994), discovery related to studies performed by a non-party scientist was denied because “special circumstances” warranting disclosure were not found to exist.. Noting that the non-party scientist  had made his studies public, the parties were directed to obtain the information from other sources. Similarly, Dr. Selikoff's 380 published scientific works are also clearly available to Kentile in the public domain. However, his unpublished notes and preliminary ideas were never intended to be exposed to the public or subject to use in litigation.

As noted in Plough Inc. v. National Academy of Sciences, 530 A.2d 1152, 1157-58 (D.C. 1987) "Although premature disclosure of ongoing research may be the most severe form of ‘chill’ on scientific research, it is not the only form. Even limited disclosure of the preliminary conclusions, hypotheses, thoughts and ideas ventured by [scientists] prior to their being tested and criticized would not only embarrass those members, it would discourage [scientists] in the future from expressing themselves freely during their deliberations, and might cause some potential volunteer to refrain from participating in [] studies altogether.

 On September 22, 2010, the New York League of Conservation Voters Education Fund (“NYLCV Education Fund”) hosted Jay Walder, Chairman of the Metropolitan Transit Authority (“MTA”), at an Eco-Partner Breakfast, a quarterly event at which leaders from around New York State meet to network and discuss issues of environmental concern. Jay Walder was nominated by Governor David A. Patterson on July 14, 2009 and confirmed as chairman and chief executive officer of the MTA on September 10, 2009. We applaud Mr. Walder for his vision and the aggressive steps that he has taken in his one year in office to keep the largest mass transit system in the United States moving in the right direction. Walder has prior experience in public transportation within the MTA, where he previously served as Chief of Staff and later as Executive Director and Chief Financial Officer. Mr. Walder left the MTA in 1995 to teach public policy at the John F. Kennedy School of Government at Harvard. Thereafter, he joined Transport for London, where he was credited with the introduction of that system’s extremely successful “Oyster card” and with leading the transportation charge as part of London’s successful bid for the 2012 Summer Olympics. 

Mr. Walder set the tone for the morning’s discussion by emphasizing the importance of seeking “transformational” change rather than “evolutionary” change at MTA. Mr. Walder identified two significant transformational milestones in the New York subway system. The first occurred in 1982, when the MTA’s first capital program was established. As a New Yorker, Mr. Walder recalled to mind how the New York subway system was considered a symbol of urban decay in the 1970’s, characterized by graffiti, constant breakdowns, oppressive heat in summer and ineffectual heating in winter. As a result of capital improvements, today’s subway system no longer suffers from the systemic problems of the 1970’s. He points out that there was a breakdown every 7,000 system miles in the 1970’s as compared to today when there is a breakdown only every 150,000 miles. 

The second transformational milestone was the introduction of the MetroCard in 1991. As a result of the MetroCard’s introduction, tokens became relics of the past, and monthly and weekly passes and automatic bus/rail transfers became a pleasant reality. Subway ridership increased from 3.5 million riders daily in 1992 to over 5 million riders daily today. Although the MTA has been criticized for recently announced service cuts, Mr. Walder has made significant strides in his one year in office in reducing MTA’s annual operating budget. This cost-cutting initiative has resulted in the removal of 3,500 jobs, a reduction by 20% of positions at MTA HQ, reduction in overtime, consolidation of functions and renegotiation of contracts with vendors. MTA is now introducing “countdown” clocks in subway stations to remove rider angst over train delays and to make New Yorkers’ long-time habit of constantly looking over the edge of the platform toward the tunnel for the next train a thing of the past.

The application of CPLR Article 16 can significantly limit a defendant’s exposure in NY litigation for non-economic loss to his or her equitable share of fault. The CPLR defines “non-economic loss” to include pain and suffering, mental anguish, loss of consortium or other similar categories of damages. Thus, Article 16 does not avail a defendant in a claim to recover lost earnings or unreimbursed medical expenses. However, for claims seeking recovery for pain and suffering, Section 1601 modifies the common law rule of joint and several liability by making a joint tortfeasor, whose share of fault is fifty percent or less, liable for plaintiff’s non-economic loss only to the extent of that tortfeasor’s equitable share. For a thoughtful analysis of whether to assert a contribution claim or to rely on the application of Article 16, I commend you to “Securing Full Protection of CPLR Article 16 for Defendants,” an article by John Lyddane and Ellen B. Fishman, partners at Martin Clearwater & Bell, which appeared in The New York Law Journal on September 14, 2010. Although the article focuses on the application of Article 16 in defending medical malpractice actions, the authors’ analysis is equally applicable to the defense of toxic tort litigation. In particular, Mr. Lyddane and Ms. Fishman provide a valuable discussion concerning how to keep Article 16 issues, (i.e., the non-defendants’ wrongs) before the finder of fact.

CPLR Article 16 contains many traps for the unwary practitioner. In particular, the exceptions to CPLR Article 16 must be considered in advising clients concerning the relief this section potentially affords them as defendants. For example, tortfeasor liability on property damage and wrongful death claims remains joint and several in respect to all categories of damages. There may be instances when a defendant should implead a co-tortfeasor as a third-party into the case rather than seek relief from Article 16. Another trap for the unwary litigant is in construction litigation. A tortfeasor shown to have violated what the law denominates a “non-delegable duty” gets no several-only status. Thus, in Labor Law Section 240 and 241 cases, a tortfeasor found liable under those sections may be found joint and severally liable for satisfying an adverse judgment if that liability is predicated upon a “non-delegable duty.”

Two wonderfully researched “must” reads for a better understanding of the debate over climate change are Climate Cover-Up: The Crusade to Deny Global Warming by James Hoggan (Greystone Books 2009) and The Climate War: True Believers, Power Brokers, and the Fight to Save the Earth by Eric Pooley (Hyperion 2010). Told from different perspectives, these books explain the global debate about climate change and identify the important players on all sides of the issue.  James Hoggan sets a provocative tone for his book from his opening metaphor: 

We are standing at the edge of a cliff. Behind us is a considerable crowd, 6.7 billion people and counting, and below is a beckoning pool. Some people say that you can jump into that pool without risk. They say that humans have been doing so for ages without any problems. But others say that waves have been eating away at the foot of the cliff, causing big rocks to fall into the water. They say that the risk of jumping grows more frightening by the day. Whom do you trust?

That’s a tricky question because here, on the climate change cliff, some of the lifeguards are just not that qualified, some have forgotten entirely whose interests they are supposed to protect, and some seem quite willing to sacrifice the odd swimmer (or the whole swim team) if they think there is a good profit to be made in the process. That’s what this book is about: lousy lifeguards – people whose lack of training, conflicts of interest, or general disregard have put us all at risk of storming off the cliff like so many apocryphal lemmings. 

What is exciting about Eric Pooley and James Hoggan’s work is that they bring the reader up-to-date concerning an ongoing struggle that requires sound scientific thinking and the best leadership that our country can provide. Everyone recognizes that climate change poses an enormous problem for our future, but there has been to date a disturbing lack of political willpower to address it.