Tag: Mass Tort

5 Tips for Personal Injury Attorneys Opening a Mass Tort Practice

Attorneys nationwide are joining the trend to add mass tort claims to their personal injury practice. Based on conservative estimates, two to four million people per year are seriously or fatally injured in mass tort cases.

Most mass tort cases are product liability cases against pharmaceutical and medical device companies. Other types involve airplane crashes, train wrecks, hotel fires, asbestos, patent, antitrust price fixing, data security breaches, securities fraud and employment claims.

It is the only practice in which economies of scale exist. These cases are national and involve filing same primary claim over and over for multiple plaintiffs. The math is compelling: in the right situation it can cost $1,500 to acquire a client with a case that will settle for $300,000, according to John Ray, senior consultant for Mass Tort Nexus and a former pharmaceutical executive.

“It is a multi-billion dollar immature market, with economies of scale and only a single barrier to entry. You have already overcome the barrier, if you hold a bar card,” Ray said.

The best strategy is to find a mass torts case with strong liability, many plaintiffs, a financially viable defendant, high settlement values and a reasonable cost to acquire a client. Here are five tips:

  1. Timing.

There are several optimal moments to seek mass tort clients:

  • In the emerging phase, when many attorneys are advertising about a particular mass tort. Most patients do not connect their prescription with an adverse event. The highest consumer awareness exists when advertising is at its peak. Currently this includes IVC Filters, Bair Hugger blankets, Invokana, Xarelto, Pradaxa, Transvaginal Mesh, Morcellator, talcum powder, Zofran and Metal-on-metal hips, according to Steve Nober, CEO of the Consumer Attorney Marketing Group.

  • MDL phase. When the federal courts create a multi-district litigation docket (MDL) for the mass tort. There are 300 federal MDLs, which organize hundreds of cases and promote settlements with trials of bellwether cases. Courts will create a form complaint and plaintiff’s fact sheet, which can be found on Mass Tort Nexus. The MDL plaintiffs committee works on all the scheduling, motions and trials.

  • In the settlement phase, when the defendant announces to its stockholders that it has set aside a settlement fund. At this point, attorneys are signing clients to settle their cases.

  1. Marketing.

The goal of any form or marketing must be to educate clients about the side effects of the product they used. Lawyers should use clear, concise language that the general public will understand. Your marketing should be about the client — not about the firm. Don’t’ forget to state that clients do not pay legal fees unless you win the case.

Marketing tactics that work include:

  • Pay for Performance Advertising. The attorney pays for a call and is not buying leads. The charge depends on how long the phone call lasts.

  • Strong Organic Web Presence. More people are filling out forms on lawyer websites, and the firm should have trained intake personnel to contact the person within minutes.

  • Standard Television Advertising. Bear in mind that a consumer will watch an ad 12 times before acting, according to Ray. TV ads will create the lexicon that people use to search for lawyers online. Smart lawyers will incorporate the exact wording of TV ads into their website.

  • Buying Leads (Caveat Emptor). Ray advises to be suspicious about lead generation companies, because there are many disreputable companies that will sell a single lead to five or six different law firms.

  1. Partnering with a law firm.

Many of the leading mass tort law firms will accept referrals in a co-counsel agreement. In this arrangement, a lawyer agrees to accept a fraction of the recovery in exchange for the other firm prosecuting the case.

A better approach is to create a co-counsel consortium, akin to entering a partnership where two firms agree to represent a client. It can be argued that no referral occurred and the word “referral” never appears in the agreement. Both firms are equally responsible and the originating attorney can claim a larger percentage. The client is getting more lawyers on his team — a dream team — but is not paying any additional legal fee.

  1. Beware of common legal risks in drug or medical device cases.

  • The Mensing Factor. The Supreme Court decided Pliva, Inc. v. Mensing in 2011, holding that failure-to-warn claims brought against manufacturers of generic medications under state law are pre-empted by federal law.

  • PMA Preemption Potential. Makers of Class III Medical Devices that undertake the FDA’s stringent premarket approval process can be exempt from certain product liability claims. See Riegel v. Medtronic, decided by the US Supreme Court, 128 S.Ct. 999 (2008).

  • Statute of Repose Issues.

  1. Evaluating your firm.

Evaluating the resources of your firm is good place to start, before delving into other considerations necessary to develop your firm’s road map to mass tort success. See which Navy ship matches your firm.

Is your firm a super carrier?

A Super Carrier is a well-established firm with a large number of lawyers and support staff and extensive in-house logistical capabilities. It has the financial reserves needed to take on all necessary tasks of mass tort litigation, without the need for outside funding or outsourcing of services.

Is your firm a destroyer?

A Destroyer is a well-armed firm loaded with weapons (human resources and an abundance of cash.) These firms move fast to develop and deploy an attack plan, for any given mass tort case. A Destroyer may still need to seek outside funding or outsource certain services, if it wishes to take on a large number of clients in a mass tort case.

Is your firm a patrol ship?

Being a Patrol Ship has more to do with strategy than any other factor. Some firms take a conservative approach to mass torts. They stay on constant patrol and only make a move when a mass tort case arises and reaches a point that allows taking clients for the case, within the risk tolerance limits of the firm.

Are you one guy in a row boat?

  • If you are a sole practitioner, with little to no staff and want to enter the mass tort space, you can, but your approach has to be realistic and you must have a relevant starting point.

  • Many sole practitioners sit on the sidelines, believing that they are not ready for the leap into mass torts. Others jump in and reap the benefits of participation.

  • If your practice has a docket of general PI cases or other assets, in most situations, you can obtain the funding to make the leap. The proceeds from your limited entry into mass torts can be used to finance future expansion of both your PI practice and additional mass tort cases.

Article By Stephen Fairley of The Rainmaker Institute
© The Rainmaker Institute, All Rights Reserved

Scrutiny of Nail Salon Chemicals Raises Mass Tort Risk

Recent reports purport to link certain chemicals used in nail salon products to serious health problems such as cancer, asthma, respiratory disease, and miscarriages.  Though past efforts to impose stricter regulations on these chemicals have been largely unsuccessful, a recent slew of New York Times articles have drawn significant attention to the issue. 126504560 In response, New York Governor Andrew Cuomo issued a number of emergency regulations to protect salon workers, and New York City mayor Bill de Blasio has announced his own efforts to address the issue.  These responses could indicate a willingness on the part of lawmakers to revisit the laws regulating the cosmetics industry.

The Food, Drug, and Cosmetics Act of 1938, bans harmful chemicals from cosmetics.  The law is over 75 years old and, many believe, outdated.  It does not require FDA preapproval before chemicals are marketed, and does not mandate that chemical companies test the effects of the chemicals.  Nor does the law require cosmetic chemical manufacturers to share safety information with the FDA.  Senators Diane Feinstein (D-CA) and Susan Collins (R-ME) recently introduced a bipartisan bill that would expand FDA oversight of cosmetics.  But critics say that the bill does not go far enough because it allows the cosmetic industry to essentially continue regulating itself.  The bill may also preempt states’ ability to implement stricter regulations.

OSHA has identified at least twelve chemicals it says causes serious health problems for salon workers.  Three of these, dibutyl phthalate, formaldehyde, and toluene, which some have dubbed the “toxic trio,” have been purportedly linked to the most serious problems, such as cancer, lung and kidney failure, birth defects, and miscarriages.  These chemicals have been banned in several countries and, in others, require labels indicating the potential consequences of exposure.  No such rules currently exist in the United States.

[S]alon workers can be exposed to levels of chemicals that are legal according to OSHA but are still dangerous . . . .

In response to recent New York Times articles highlighting the working conditions of nail salon employees, Governor Cuomo issued emergency regulations to address the potential health hazards these workers face.  Thenew rules, which require manicurists to wear gloves and masks and mandate ventilation at salons, are expected to become permanent in the coming months.  NYC Mayor Bill de Blasio has also announced steps to address this issue.  In addition, NYC’s Department of Consumer Affairs has been visiting salons to collect and test products.  The Department indicated it would issue subpoenas to the manufacturers of products labeled free of a certain toxin if the product is found to contain that toxin.  The Department has also started a petition directed at the Personal Care Products Council, the cosmetic chemical industry’s main trade group, to urge its members to stop using ingredients linked to certain ailments.  The agency has sent similar letters to the FDA and OSHA.  David Michaels, the labor secretary who heads OSHA, believes OSHA’s standards are outdated and has said that salon workers can be exposed to levels of chemicals that are legal according to OSHA but are still dangerous to the workers.

The increased regulatory and media focus on the health threats facing salon workers suggests the potential for lawsuits arising from cosmetic chemical exposure.   As in other mass or “toxic tort” claims, salon worker lawsuits may involve a large number of defendants, since workers often use a variety of products made by different manufacturers.  In states that impose strict product liability on anyone in a product’s chain of distribution, nail salon lawsuits may implicate not only manufacturers, but also wholesale and retail distributors of chemical products.  As in other “toxic tort” cases, nail salon lawsuits would likely involve competing expert testimony from toxicologists, industrial hygienists, and epidemiologists regarding a numerous issues not that least of which being general and specific causation.

ARTICLE BY Jamie Lynn Lanphear & Yakov P. Wiegmann of Schiff Hardin LLP
© 2015 Schiff Hardin LLP