Compensation Fund as an Alternative - Frankfurter Allgemeine Zeitung - October 01, 2001

Compensation Fund as an Alternative/American Attorneys’ Image of Themselves: In the current mood of crisis, lawsuits are risky
By Katja Gelinsky
Frankfurter Allgemeine Zeitung
October 1, 2001

Translated from German by German-American Business Translation, Chicago, IL

When a disaster occurs anywhere in the world that touches Americans or American companies, it usually isn't long before the first complaints for damages arrive on American judges' desks. American attorneys who specialize in this are noticeably reticent, however, in the wake of the terror attacks in Washington, New York, and Pennsylvania. One reason may be the appeal by the Association of Trial Lawyers of America to forego lawsuits for now after this national tragedy.

It suits them fine that it appears to be more clever for tactical reasons to hold off on lawsuits for the time being. Attorneys have a difficult time at this point evaluating whether it might be more advantageous for victims of the disaster to accept a speedier offer of compensation from the government rather than rely on protracted litigation. It will only be possible to determine which path is better once the details of a government compensation fund have been worked out. At the present, however, it's not even clear how much money the individual victims are to receive from the government.

In the current mood of crisis, hurried lawsuits would be risky as well because the attorneys might incur the displeasure of the Federal court in New York, which by law would have jurisdiction over possible litigation arising from the airplane hijackings and assassinations. That would reduce their chance of having a say in the direction of such litigation. In mass litigation, namely, not every attorney gets to appear before the court. Rather, a committee of attorneys is formed which then conducts the trial for all the others. According to Chicago attorney Kenneth Moll, who is pursuing class action lawsuits in the Firestone matter against Ford and in the Lipobay/Bayer matter against Bayer, the judge determines who will be members of the committee if the attorneys can't agree among themselves. Attorneys representing many plaintiffs and considered experienced and conscientious have the best chance. Membership on the committee gives them influence, prestige and the prospect of a larger share in the honorarium.

According to law professor Anthony Sebok, who teaches torts at the University of Brooklyn in New York, attorneys specializing in actions for damages have gained considerable regard and influence over the last ten years. In the past, graduates of mediocre universities often used actions for damages to scrape by as sole practitioners. Lawyers with self-respect and a desire to make money, on the other hand, went to work for banks, insurance companies, and big corporations. Since plaintiffs' attorneys succeeded in winning big settlements against the asbestos and tobacco industries, however, more and more lawyers are taking an interest in the suffering of consumers and workers.

For Kenneth Moll, in contrast, it's a mainly matter of conviction, whether "you take the side of the company or the consumer." At some future time he wants to retire knowing he's "provided a service to society," for instance, when dangerous products are withdrawn from the market because of his class action suit. Moll's law firm markets itself with the slogan, "cases that benefit society." That may seem strange from a German standpoint, in part because the declaration of altruism is bound up with an expectation of more than starvation wages. But American plaintiffs' attorneys view themselves as proponents of social justice in a society that doesn't have much sympathy for the idea of the state providing for its citizens in time of need. Government or government-initiated insurance against illness and hard times is much less prevalent in America than in Germany. That's why Americans are more likely than Germans to file a lawsuit when health, well-being or social safeguards are at risk. From the standpoint of their attorneys, such lawsuits act as a corrective to the power and influence of business. The class action suit, unknown in Germany, has proven to be particularly effective. Under pressure from the masses, companies are more likely to indicate a willingness to settle.

According to Sebok, American attorneys specializing in actions for damages are beginning to discover Europe as a market. Only those Europeans willing to file suit attract their interest, however, if their cases can also be brought before an American court. Germans are also among the plaintiffs Moll is representing in the Lipobay case. Moll is not so pleased, however, with those colleagues who immediately get in an airplane after accidents and disasters to get to the site and run after victims willing to sue. These lawyers, known disparagingly as "ambulance chasers" in America, bring discredit upon the entire profession, in his opinion. The president of the American Bar Association, Robert Hirshon, pointed out that local bar associations are increasingly sending consulting teams to the scene of accidents, who can then provide first aid of a legal sort to the victims, protecting them from hasty decisions.

With the success that actions for damages have had against companies, in no small part due to consumer-friendly juries, the desire grew, in particular among business people, to see legislators draw tighter boundaries. Numerous American states have since reformed their product liability, civil procedure and tort laws. Especially the weapon of punitive damages, which are supposed to punish business for careless behavior and deter them from subsequent violations, has been defused, for example by setting upper limits. In Sebok's opinion, these attempts at reform don't deal with the heart of the matter. Anyone wanting to reduce actions for damages would have to offer the plaintiffs an alternative. The law that provides for the establishment of a government compensation fund for the victims of September 11 is a very promising beginning, in his view. That would truly give the victims to understand that civil courts are not the right place to cope with a national tragedy.

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