During my law school reunion I recently attended a very interesting panel discussion entitled “The Democratization of Mass Litigation,” which focused on identifying problems that often occur in adjudication and settlement of mass torts and other mass litigation, and possible solutions.  The impressive panel included a slew of experts in this area — Prof. John Coffee as moderator, Judge Jack Weinstein, Judge Alvin Hellerstein, Ken Feinberg (a mediator/special master who has played a central role in resolving claims arising from 9/11 and the BP oil spill), prominent plaintiffs’ attorney Elizabeth Cabraser, Pfizer CEO Amy Schulman and Prof. Bert Huang.  It struck me that many of the issues raised applied to the litigation of insurance coverage lawsuits involving Hurricane Katrina and Hurricane Ike, and likely will apply to insurance litigation following the recent rash of tornados.  These are not class actions but mass actions — hundreds of lawsuits, often filed by one plaintiffs’ firm or group of firms, involving insurance claims arising out of a catastrophe.  Last year I wrote an article with Louisiana lawyer Seth Schmeeckle for the ABA’s Coverage publication addressing the management of catastrophe litigation by insurers, focusing on lessons learned from Katrina.

The problems identified by the panel that I think apply to mass insurance litigation are:

  1. Claimants need an opportunity to be heard in their own voice, not through a lawyer, and sometimes don’t get that opportunity.  People who have lived through a disaster often want an opportunity to tell their story.  That can sometimes be just as important or more important than the relief they are seeking.  Some people file lawsuits because they want someone to listen to what they went through.  Given that few cases are (or can be) tried, the opportunity for people to tell their story often happens during a mediation, if individual claimants are allowed (or required) to participate in mediation.  There needs to be a mechanism for claimants who want to do so to tell their story, and the sooner the better.
  2. It is fairly common that claimants who have unmeritorious claims receive more than they deserve, typically because either the aggregation of numerous claims against a defendant by one plaintiffs firm tends to give unmeritorious claims more settlement value than they deserve.  Conversely, sometimes claimants with meritorious claims receive less than they deserve, perhaps because they hired a weaker lawyer, the true facts were not adequately aired, or because payments made on unmeritorious claims leave less money available for meritorious ones.  These incongruous results can cause people to lose confidence in our legal system if the system starts looking like a game where outcomes (settlements) are based more on which lawyer you hire or how you play the “game” (including whether you exaggerate your claim) than whether your claim has merit.  Good insurers want to pay their customers what is fairly owed and they don’t want to pay frivolous claims, but the way that litigation plays out and the personalities and tactics involved can lead to outcomes inconsistent with those objectives.
  3. Mass litigation can lead to breakdowns in the attorney-client relationship and unhealthy incentives for lawyers.  Plaintiffs’ lawyers who take on hundreds of clients’ catastrophe claims often fail to keep their clients adequately informed.  It’s not uncommon for a plaintiffs’ lawyer to believe he has signed up a particular client and the client to later claim (sometimes even after a settlement has been “agreed” to) that the lawyer does not represent them.  After plaintiffs’ attorneys have financed litigation for two or three years, they have a strong incentive to settle in order to recoup their investment, which may not align with some of their clients’ interests.  This incentive is exacerbated if the plaintiffs’ attorney has taken out a loan (typically at a high interest rate, and with personal guarantees that put partners’ personal assets at risk) to finance the litigation or keep their office running while waiting for anticipated settlements.

What will help solve these problems?  Several solutions were proposed during the discussion, some of which I agree with, others I disagree with:

  1. Require that judges approve settlements in non-class action mass litigation.  I don’t think this is a good idea.  It puts too much power in the hands of a single judge, and which judge you happen to draw.  It seems unlikely that appellate courts would be able to provide serious scrutiny of these decisions given how many settlements would require approval.  One judge’s idea of what is “fair” for a particular claimant may be very different from another judge, and disparate results based on which judge you draw, while somewhat inevitable in litigation generally, does not improve confidence in the legal system.
  2. Require that in mass litigation, each plaintiff submit, early on, a sworn fact sheet setting forth necessary (but not unduly burdensome) details of their claim along with pertinent backup documents.  It would have to be sworn by the plaintiff, and could not be delegated to a plaintiffs’ attorney via power of attorney or otherwise.  This is something like a Lone Pine order.  I think this is a very good idea, it allows lawyers on both sides to triage cases early on, requires claimants to personally participate in the legal process, puts claimants on more equal footing regardless of their selection of a lawyer, and may deter exaggeration of claims.  This is part of the process by which claimants can tell their story, but they should, if possible, have an opportunity for an oral presentation as well (typically at an early mediation).
  3. Use bellweather trials to help parties make more informed settlement decisions, but use a random method to select cases for trial (because trials of cases selected as good cases for one side or the other are not particularly helpful).  This might work, but in insurance litigation each case really is different and trying to peg cases as “similar” to ones that have been tried can be difficult.  This may be more appropriate for personal injury suits from a mass tort.
  4. Use court websites and other techniques to make sure claimants are kept informed, even if their lawyers don’t do an adequate job of that.  I think courts are generally doing this in mass litigation and it is a good idea.

Should there be a new rule for mass litigation, laying out how these cases should be handled, or should we continue to leave it entirely in the discretion of the judge handling the litigation as to which special mechanisms, if any, to employ?  I think a new rule on this or something in the Manual for Complex Litigation on it would be a great idea.


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Photo of Wystan Ackerman Wystan Ackerman

I am a partner at the law firm of Robinson+Cole in Hartford, Connecticut, USA.  My contact information is on the contact page of my blog.  I really enjoy receiving questions, comments, suggestions and even criticism from readers.  So please e-mail me if you…

I am a partner at the law firm of Robinson+Cole in Hartford, Connecticut, USA.  My contact information is on the contact page of my blog.  I really enjoy receiving questions, comments, suggestions and even criticism from readers.  So please e-mail me if you have something to say.  For those looking for my detailed law firm bio, click here.  If you want a more light-hearted and hopefully more interesting summary, read on:

People often ask about my unusual first name, Wystan.  It’s pronounced WISS-ten.  It’s not Winston.  There is no “n” in the middle.  It comes from my father’s favorite poet, W.H. (Wystan Hugh) Auden.  I’ve grown to like the fact that because my name is unusual people tend to remember it better, even if they don’t pronounce it right (and there is no need for anyone to use my last name because I’m always the only Wystan).

I grew up in Deep River, Connecticut, a small town on the west side of the Connecticut River in the south central part of the state.  I’ve always had strong interests in history, politics and baseball.  My heroes growing up were Abraham Lincoln and Wade Boggs (at that time the third baseman for the Boston Red Sox).  I think it was my early fascination with Lincoln that drove me to practice law.  I went to high school at The Williams School in New London, Connecticut, where I edited the school newspaper, played baseball, and was primarily responsible for the installation of a flag pole near the school entrance (it seemed like every other school had one but until my class raised the money and bought one at my urging, Williams had no flag pole).  As a high school senior, my interest in history and politics led me to score high enough on a test of those subjects to be chosen as one of Connecticut’s two delegates to the U.S. Senate Youth Program, which further solidified my interest in law and government.  One of my mentors at Williams was of the view that there were far too many lawyers and I should find something more useful to do, but if I really had to be a lawyer there was always room for one more.  I eventually decided to be that “one more.”  I went on to Bowdoin College, where I wrote for the Bowdoin Orient and majored in government, but took a lot of math classes because I found college math interesting and challenging.  I then went to Columbia Law School, where I was lucky enough to be selected as one of the minions who spent their time fastidiously cite-checking and Blue booking hundred-plus-page articles in the Columbia Law Review.  I also interned in the chambers of then-Judge Sonia Sotomayor when she was a relatively new judge on the Second Circuit, my only connection to someone who now has one-ninth of the last word on what constitutes the law of our land.  I graduated from Columbia in 2001, then worked at Skadden Arps in Boston before returning to Connecticut and joining Robinson+Cole, one of the largest Connecticut-based law firms.  At the end of 2008, I was elected a partner at Robinson+Cole.

I’ve worked on class actions since the start of my career at Skadden.  Being in the insurance capital of Hartford, we have a national insurance litigation practice and I was fortunate to have the opportunity to work on some prominent class actions arising from the 2004 hurricanes in Florida and later Hurricane Katrina, including cases involving the applicability of the flood exclusion, statutes known as valued policy laws, and various other issues.  My interest and experience in class actions gradually led me to focus on that area.

In Connecticut courts I’ve defended various kinds of class actions that go beyond insurance, including cases involving products liability, securities, financial services and consumer contracts.

My insurance class action practice usually takes me outside of Connecticut.  I’ve had the pleasure of working on cases in various federal and state courts and collaborating with great lawyers across the country.  While class actions are an increasingly large part of my practice, I don’t do exclusively class action work.  The rest of my practice involves litigating insurance coverage cases, often at the appellate level.  That also frequently takes me outside of Connecticut.  A highlight of my career thus far was working on Standard Fire Ins. Co. v. Knowles, the U.S. Supreme Court’s first Class Action Fairness Act case.  I was Counsel of Record for Standard Fire on the cert petition, and had the pleasure of working with Ted Boutrous on the merits briefing and oral argument.

I started this blog because writing is one of my favorite things to do and I enjoy following developments in class action law, writing about them and engaging in discussion with others who have an in interest in this area.  It’s a welcome break from day-to-day practice, keeps me current, broadens my network and results in some new business.

When I’m not at my desk or flying around the country trying to save insurance companies from the plaintiffs’ bar, or attending a conference on class actions or insurance litigation (for more on those, see the Seminars/Programs page of this blog), I often can be found playing or reading with my young daughter, helping my wife with her real estate and mortgage businesses, reading a book about history or politics, or watching the Boston Red Sox (I managed to find bleacher seats for Game 2 of the 2004 World Series when Curt Schilling pitched with the bloody sock).  When the weather is good I also love to take the ferry to Block Island, Rhode Island and ride a bike or walk the trails there. If you go, I highly recommend the Clay Head Trail.