Quote of the Day - Life moves pretty fast. If you don't stop and look around once in awhile, you could miss it.
Lawyer 2 Lawyer Internet Radio Looks To Legal Wikis: Boom Or Bust?
On this week's Lawyer 2 Lawyer, we will explore the world of "Legal Wikis." Are they helping or hurting the law? What does the future hold for Wikis? Are we reshaping years and years of facts through the click of a button?
Join me and my co-host and fellow Law.com blogger Bob Ambrogi as we hear from the experts: Martin Farley, an Intellectual Property Law Librarian at Freshfields Bruckhaus Deringer in London, England, returning guest Tom Mighell, Senior Counsel and Litigation Technology Support Coordinator at Cowles & Thompson in Dallas, Texas and Daniel N. Lewis, entrepreneur and Vice President of Business Development and General Counsel of St. Petersburg, Florida's Wikia, Inc. Don't miss this show!
Should Courts Look Forward To Determine Insurance Coverage Or Back In Time?
Indiana's Supreme Court issued a ruling favoring insurance companies and against power companies over what it characterizes as "future contamination." The case, Cinergy Corp., et al. v. Associated Electric & Gas Insurance Services Ltd. and St. Paul Surplus Lines Insurance (plus several other power companies and some 21 other insurance companies) casts a backward look at insurance policies, both from a coverage and perhaps a shortsighted viewpoint.
In short, here's the Court's summary of its ruling from the first paragraph of the decision: "Incurring enormous defense costs in the course of a federal environmental lawsuit, several power companies desire payment of these defense costs, as they are incurred, under the terms of certain liability insurance policies. The insurance companies, denying liability for such defense costs, initiated this action for declaratory judgment. The power companies sought partial summary judgment to compel payment of all past and future defense costs incurred in responding to the federal lawsuit. We affirm the trial court's denial of the motion because it seeks relief more extensive than that to which the power companies are entitled."
First, the power companies were sued by the federal government, three states and several environmental groups for alleged violations of the Clean Air Act. In response to those suits, the power companies incurred nearly $4 million in defense costs and agreed to install certain emissions equipment to prevent future violations. Next, they asked their insurance companies to provide coverage. But the insurance companies declined and said, essentially, "we don't cover future damage."
That's what sidetracked the court, helped along by the insurance companies.
Framing the issue that way may not have been the right way to look at the problem. The court characterized the lawsuit against the power companies as: "alleging failure to obtain permits and discharge of excess emissions from power plants resulting in wide-spread harm to public health and the environment."
That language does not sound like future harm. Sure, the remedy does, but not the allegations, which should have made all the difference in the world. Insurance policies like the ones that cover these power companies provide coverage for harm to people and the environment that occurred in the past. They don't mention anything one way or the other about remedies.
Unfortunately, the court doesn't provide all of the language from the insurance policies at issue, so we may not ever know the answer to this question: does the policy provide coverage for lawsuits arising out of pollution? Most pollution policies do, and from the language tossed around in this opinion, it would seem these policies do, too.
The power companies appear to have been unable to get the court to focus on the underlying lawsuit and its allegations of past harm. If the court had focused on these factors, then it likely would have found coverage under typical insurance law.
The court, however, admits its own failings: "Synthesizing the policies' insuring agreements with their respective definitions of capitalized words and phrases is a daunting task, replete with often confusing, redundant, and some-times circular concepts."
Too bad they didn't look to the underlying litigation. Had they been applying California law, they likely would have found coverage.
Maybe in Indiana insurance policies look ahead, not back - I don't know; I'm not admitted there.
But it is tough to insure the future, no matter what state you're in. Most insurance policies I've seen cover past acts, which is what the court told us this lawsuit alleged.
Free Speech Not Free When You Defame Others
You have a First Amendment right to say whatever you want, even if it's critical, right?
There are limits. The typical example prohibits you from yelling "Fire" in a crowded theater. That limit exists because to do so is dangerous. But what happens if you just want to be critical?
And critical and critical and critical. Almost like a protest.
Anne Lemen, a self-described Christian evangelist, found out the hard way. She was apparently upset with a neighboring restaurant, the Balboa Island Village Inn, a small bar and grill just down the way from MIPTC in Newport Beach. Lemen lives next to the restaurant, which she defamed as part of her campaign to shut the bar down, telling anyone that the bar made sex videos, dabbled in child pornography, distributed illegal drugs, encouraged lesbian activities, had mafia links, was a whorehouse and sold tainted food. The trial court ruled all were false statements, and banned her from making them.
That's not all Lemen said, according to the California Supreme Court: She called customers "drunks" and "whores." She told customers entering the Inn, "I don't know why you would be going in there. The food is shitty." She approached potential customers outside the Inn more than 100 times, causing many to turn away. Lemen had several encounters with employees of the Village Inn. She told bartender Ewa Cook that Cook "worked for Satan," was "Satan's wife," and was "going to have Satan's children." She asked musician Arturo Perez if he had a "green card" and asked whether he knew there were illegal aliens working at the Inn. Lemen referred to Theresa Toll, the owner's wife, as "Madam Whore" and said, in the presence of her tenant, Larry Wilson: "Everyone on the island knows you're a whore."
Aric Toll, who bought the business in 2000, perhaps not too surprisingly, saw his sales drop by 20%.
Despite these defamatory remarks, the Court of Appeals reversed the trial court's injunction, leaving only minor restrictions in place (preventing her from videotaping patrons on their way in or out of the bar).
Last week, however, the California Supreme Court reversed the reasoning in the Court of Appeal's decision, and ruled that a Court can stop Lemen's defamatory statements and activities. In the Court's words (despite two separate dissents and one concurring opinion), ". . . a properly limited injunction prohibiting [Lemen] from repeating statements about [the Village Inn] that were determined at trial to be defamatory would not violate [Lemen]'s right to free speech."
There is a line, and Lemen crossed it. Now the case goes back to the lower court to redo the injunction and hold a trial on the damages Lemen caused the bar. That will be an expensive lesson in "free speech."
The Professors Are Lecturing Over At Blawg ReviewProfessor Kingsfield has returned to the Blawg Review this week because Professor Bainbridge returned to Washington, DC to offer some guidance to the SEC. This week's Blawg Review is a good one - don't miss it!
Taunting The SEC From Foreign Shores
The SEC wants some $2.7 million disgorged in illegal stock trades and an $8 million penalty awarded recently by a judge. The SEC wants more than $10 million from a Hong Kong company, Blue Bottle, Ltd., and its 30-year old CEO, Matthew Stokes, from Guernsey, a small island in the English Channel perhaps more famous for its secrecy and financial isolation from the rest of the world. And Hong Kong?
Right. The SEC stands more of a chance of collecting money than Germany has of occupying Gurnsey again.
Neither the company nor its CEO appeared in New York to contest the proceedings, so the SEC won by default. The SEC alleged that the company and its CEO hacked into unspecified computers on unspecified networks to gain information not yet available to the general public. They then traded on that information, using call options, which bet share prices would rise on good news and put options, which bet prices would decline on bad news.
But what of the place where the perpetrator resides? Guernsey is one of the last remnants of the medieval realm of the Duke of Normandy, and while dependent on the Crown, it is not part of the United Kingdom. As a consequence, it has its own laws and virtually answers to no one.
In other words, it's a tax haven, and just as equally a haven from the SEC.
As long as Mr. Stokes and his company stay behind these curtains, then it is likely the SEC will never see its money.
When Is Enough Too Many?
According to reports, the gasoline truck that blew up and incinerated one of San Francisco's freeway ramps, snarling traffic for what may be months, was the holder of some 27 citations, and the company who owns the truck the no-so-proud holder of nearly 60 citations. In fact, news reports claim the truck was ordered off the road last year.
Yet it continued to roam the roads, seemingly impervious to regulation.
Who regulates the regulators?
One Obstacle To Docking Your Boat: Sunken Boats In Your Slip
MIPTC is a big fan of sailing, and like all good skippers, even more of a fan of docking the boat at the end of the trip. It's like the pilots say: any crash you can walk away from is a good crash.
For many boat owners who suffered the ignominy of their boats sinking in the slips of New Orleans harbor, there must be some level of relief with the start of the project to remove the sunken vessels from underwater.
It's expected to cost nearly $1 million to remove the hulks, some 300 tons in all.
The storm that has no end.
Vonage vs. Verizon: Perhaps First In Flood Of Patent Case Reconsiderations
By now, if you follow anything to do with current legal issues, you've seen most of the analysis and prognostications from lawyers across the country about the recent Supreme Court patent decisions, and the earth-shattering change one of Black Monday's decisions will have on the patent bar and patent litigators, like this firm. In case you missed it, however, click here for a roundup of the professor and practitioner's take on the decision on KSR v. Teleflex.
Or, if you're somewhat more kinesthetic, then you can listen to this podcast recorded today with three top patent experts.
If you're not in the ivory towers, but rather in the trenches like we are, then perhaps this New York Times report is more apropos. In that report, Vonage is requesting a new trial after it got slammed by a jury who favored Verizon's version of the patent case. The reason? Black Monday's Supreme Court decision.
Given that decision, anyone with a patent based in part on prior art, and if it's "obvious" - as opposed to patentable - the patent holder can expect a challenge to their patent by someone who wants to do the same thing. Patent holders just saw the value of their patent portfolios drop through the floor.
Perhaps this quote from Aubrey Menen encapsulates the Supreme Court's ruling best: "The essence of success is that it is never necessary to think of a new idea oneself. It is far better to wait until somebody else does it, and then to copy him in every detail, except his mistakes."