Congratulations To Professor Bernabe

Last week, AbnormalUse marked its 500th post.

This week there’s another milestone in the torts law blogosphere worthy of congratulations: the third birthday of Prof. Alberto Bernabe’s Torts blog. Prof. Bernabe has blogged 1145 posts since Nov. 7, 2008.

1145 posts: all I can say is “Wow.” I hope to make it there someday too — if carpal tunnel does not derail me first.


When It Comes To Health Care Savings, You Have To Think Big. Really big.

  Dr. Ezekiel Emanuel (brother of Rahm and Ari) had an op-ed in last week’s New York Times that hammered home how big you really have to think if you want to stabilize health care costs. As Emanuel pointed out, lots of conservatives and liberals have their own pet ideas for how to rein in the cost of health care. But most of these ideas are too small to really make a dent in health care spending.

We spend $2.6 trillion a year on health care. Our health care spending is growing at a rate of $100,000,000,000.00 annually. So, if your proposal for trimming the cost of health care comes to less than 100 billion annually, health care spending will still be growing, despite your reform. Emanuel proposes that any health care reform proposal should have to net at least $26 billion in savings. That’s one percent of our (current) health care spending.

By this criterion, $250,000 caps on damages in medical malpractice fail the test. As Emanuel notes, caps on medical malpractice damages would only save at most $11 billion a year. And they might even lead to higher health care costs as doctors become more careless. (Gee whiz, given that avoidable medical errors are our sixth-leading cause of death, do you think so?).

I thought Emanuel’s op-ed made a lot of sense but one thing that surprised me was the disparaging tone he took toward the idea of identifying “million dollar babies” (patients whose health care tabs run into the millions of dollars). Emanuel seemed to suggest that once we identify the “million dollar babies,” there’s no way to reduce spending on them, other than cutting them off from more health care services. Have you heard of hotspotting, Zeke? Maybe that’s worth a shot.

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A Business Legend Explains Why Insurance Companies Delay Resolving Personal Injury Claims

  Insurers always deny they’re acting in bad faith when they delay and dispute claims. They insist that they need to take so long to sort out the facts and determine if they are liable.

Trial lawyers and others have long insisted that these excuses are designed to conceal the insurance companies’ financial motives for stretching everything out.

This week, courtesy of a column by Arthur Licata in Massachusetts Lawyers Weekly, I came across a lengthy quote from Warren Buffet (a quote I don’t recall previously seeing) that perfectly explains how the insurance industry works.

Of course, the insurance business is a mainstay of Buffet’s Berkshire Hathaway and GEICO insurance and others are owned by Berkshire.

This is how Buffet explained the insurance component of Berkshire Hathaway in his 2009 letter to Berkshire shareholders:

“Insurers receive premiums up front and pay claims later. In extreme cases, such as those arising from certain workers’ compensation accidents, payments can stretch over decades. This collect now, pay later model leaves us holding large sums — money we call ‘float’ — that will eventually go to others.

“Meanwhile, we get to invest this float for Berkshire’s benefit. Though individual policies and claims come and go, the amount of float we hold remains remarkably stable in relation to premium volume. Consequently, as our business grows, so does our float.

“If premiums exceed the total of expenses and eventual losses, we register an underwriting profit that adds to the investment income produced by the float. This combination allows us to enjoy the use of free money — and better yet, get paid for holding it.”

What tort reformers and others don’t want you to understand is that the insurance business is really the investment business. When doctors’ medical malpractice premiums go up, doctors, ignorant of the insurance business, blame medical malpractice suits, instead of understanding that medical malpractice premiums are really controlled by investment returns, rather than payouts.

The next time sometime tells you they’re from an insurance company, think of it as a “getting paid-to hold-free money” company.

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Supreme Court Allows Patients To Sue For Defective Artificial Hips

On Halloween, the Supreme Court denied certiorari — that is it declined to hear — an appeal in Stryker v. Bausch, a case in which a woman sued for injuries she received from an FDA-approved artificial hip that was later recalled.

Since the lower court, the Seventh Circuit Court of Appeals, ruled in the woman’s favor, the Supreme Court’s decision not to hear the case allowed the woman’s victory to stand.

The argument on the part of the hip manufacturer was that the FDA approval process insulated it from liability.

We’ve seen what a joke the FDA approval process of medical devices can be. And we’ve also written a lot about how tort liability is superior to regulation — both from the perspective of compensating injury victims and from the perspective of insuring that the public has access to all kinds of new, safe medical devices.

So, two cheers for the Supreme Court. It doesn’t always get things wrong.

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Congratulations To Abnormal Use

Congratulations to our friends over at AbnormalUse, who recently celebrated a milestone:  their five hundredth blog post.

This blog is approximately as old as AbnormalUse and this post marks our 235th post, to give you some idea of how prolific AbnormalUse are.

AbnormalUse really makes their 500th post count too, sharing with readers some pearls of wisdom they’ve gained over the course of running the blog.

My own bit of wisdom for lawyers contemplating a blog: do it only if you love to write and/or write in your sleep. Blogging has to be its own reward; don’t count on your blogging winning you or your firm honors or acclaim. And write something worth reading. This xkcd cartoon on blogging pretty much sums up my view on blogging:

My other pearl of blogging wisdom: if you’re a lawyer-blogger who really wants to rack up the page views, make your blog political and news-oriented, rather than legal, like Althouse, Glenn Reynolds and Bill Jacobson have done. That’s part of why I admire AbnormalUse so much: they made it to 500 posts and managed to keep their blog’s focus intact.



Intellectually Lazy Or Logically Sound? A Reply To Dr. Donnell On Financial Incentives Affecting Guidelines And Clinical Trials

Dr. Robert Donnell, blogging at, authored a post over at Kevin.MD the other day entitled, “Judging A Guideline Just By Financial Interest Is Intellectually Lazy.”

The post was in response to recent investigative journalism criticisms centering around the fact that that medical societies responsible for authoring treatment guidelines often have a financial stake in their recommendations. For an introduction to some of the investigative journalism on this topic, you can check out ProPublica’s work here on the financial ties between the National Lipid Association and the pharmaceutical industry.

Dr. Donnell thinks the journalists and others who have attacked guidelines based on the financial interests of research authors, etc., are “intellectually lazy.” Dr. Donnell thinks the criticisms of guidelines that point to the financial interests of medical societies and individual researchers also represent a logical fallacy. Donnell writes that these attacks are, “an ad hominem attack (and therefore fallacious) because virtually all of the criticisms of guidelines that have been written are based not on the science or the [journal articles] referenced in the guidelines but on the company they keep.”

Dr. Donnell may be right that a lot of the investigative journalism pieces may not engage with the science; they may simply point to sinister-seeming associations between drug and medical device companies and the illustrious doctors who promulgate the guidelines.

So what does the science say? Is there any scientific, empirical basis for finding a research study or clinical trial to be less trustworthy based on the fact that it was financed by a drug company? The answer is: YES.

For a great starting point, check out an article published by the prestigious British Medical Journal entitled, “Pharmaceutical Industry Sponsorship And Research Outcome And Quality:  A Systematic Overview,” which you can check out here. The authors of the BMJ article found that studies funded by a pharmaceutical company were four hundred percent more likely to give results that were favorable to the drug company than independent studies.

Oftentimes it’s difficult to discern how drug industry funding is influencing the methodology or results of scientific studies. You can read the “primary sources,” as Dr. Donnell, argues and engage with the science on its own merits and still not uncover anything askew, anything scientifically unsound. But nevertheless, there’s no getting around a brute empirical fact:  Scientific research funded by Big Pharma, for whatever reason, produces results that are biased in favor of the drug companies.That’s not ad hominem attack, that’s not casting aspersions on anyone’s integrity — that’s a scientific fact.

Examples of the empirical tendency for drug company-funded research to favor the drug companies’ own product abound. One fascinating meta-analysis compared the results of fifty-six different drug company-funded studies of painkillers. In each of the fifty-six studies, the painkiller marketed by the Big Pharma sponsor funding the study came in first place. How can all of fifty-six different drugs be better than each other? Answer: They can’t. The study authors’ financial ties presumably influenced their work. (You can engage with the science of that study by clicking here).

(For a wonderfully fun tour of drug company research shenanigans, check out Dr. Ben Goldacre’s wonderful book, “Bad Science:  Quack’s, Hacks and Big Pharma Flacks”).

Rather than being illogical or ignorant, assuming that someone’s financial incentives influence his actions is a basic principle of social science. Rule Number 4 of Harvard Professor Gregory Mankiw’s “Ten Principles of Economics” is “People respond to incentives.” Automatically discounting (to a certain degree) the findings of research studies, where the study has a financial motive is a sensible and reliable heuristic device for people who don’t have the time or the abilities to dive into the research firsthand.

Should you engage with the research studies firsthand if you are able to do so? By all means. But as some of the studies cited above illustrate, there are scientific reasons for viewing their results skeptically.

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Please Excuse The Blogging Miscues

You may have noticed that the blog was undergoing maintenance and repairs from Monday to today. As part of that process, I switched over to a WordPress platform. I’m still getting used to everything and hope to get up to speed quickly. In the meantime, please bear with us as the bugs are worked out.

In related news, a slight re-design of the blog will be rolled out sometime within the next couple weeks. Hopefully the new typeface and style will reduce some of the eyestrain of the old design.

I also hope that RSS feed subscribers check to make sure that they receive uninterrupted feeds over the next few weeks.

As always, thank you for reading what is on my mind.

Link Roundup


  • A couple of weeks ago, I blogged about “Paradise Lost,” a documentary about the “West Memphis Three,” three men convicted of the crime who were recently released from prison after winning the right to a new trial on appeal. To me, one of the most amazing parts about the documentary was the access that the defense lawyers allowed the documentary camera crews. At the tail end of my post, I beseeched Professor Alberto Bernabe (on whose blog recommendation I viewed “Paradise Lost”) to give his take on the ethics of the lawyers’ inviting in the camera crews and giving them such access, professional ethics being one of Professor Bernabe’s areas of specialty.
    Well, my request earned a response and that response is now available here. As Prof. Bernabe, explains there are several ethical considerations that come into play when lawyers cooperate with media accounts of their cases, including rules prohibiting lawyers from profiting from literary deals made while still representing their clients. You should read Prof. Bernabe’s full treatment of the ethical issues for yourself.
    Ultimately, I guess, whether the lawyers’ actions were ill-advised, as I had initially thought, or whether they were completely prudent, things worked out for the clients’ benefit: the documentary attracted the attention of rock stars and other celebrities who helped finance the costs of their appeals.
  • At the risk of Professor Bernabe dominating this week’s roundup, a post of his about a new Alien Tort Statute case making its way to the Supreme Court, inspired me to wonder why these Armenian-American attorneys are trying to apply the Third Amendment extra-territorially instead of making claims under the ATS. The Third Amendment claim seems highly dubious to say the least.
  • Also from the Concurring Opinions blog, Professor Frank Pasquale with a very good post on Occupy Wall Street.

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If We Get Rid Of Lawyers Will We Have More Lawsuits? And A Thought About Brain Drain

lawyer-salary.jpgThere’s been a lot of chatter in the blogosphere lately about whether there should be any professional requirements connected with lawyering. The issue has been brought front-and-center by the publication of a new book by libertarian authors arguing that anyone should be able to provide legal services for a fee, regardless of whether he’s attended law school, passed the bar or obtained any sort of credential. Over the course of a couple of blog posts, I chimed in with my own two cents, essentially backing the idea.
I wasn’t planning on blogging any further about the topic but last weekend The Press of Atlantic City cited me in an editorial piece addressing the controversy. The piece also cited Chidem Kurdas, a NYU economist, worrying that deregulation of the legal profession would lead to an influx of a large amount of new lawyers and spawn a gigantic new wave of litigation. Overlawyered’s Walter Olson opposes the idea for pretty much the same reasons.
I wish to raise two arguments in reply.
The first is that I think the idea that deregulating the legal profession will lead to a huge influx of new lawyer/amateurs and a huge wave of new litigation is a bit silly — especially in the long run. Kurdas and Olson’s thinking suggests to me a mistaken belief in a stable equilibrium of lawyer salary, even in a deregulated world. The moment that anyone is free to provide legal services is the moment when the bottom drops out of lawyers’ incomes. When the supply of lawyers goes up, their prices will go down. There won’t be a long-lived influx of new lawyers ginning up all kinds of new lawsuits if they discover there isn’t as much money to be made as they had hoped. They’ll return to their prior occupations.
The second point I wish to make is that driving down lawyers’ salaries will have another beneficial effect on the economy: it will prevent the brain drain of science PhDs into intellectual property law that we are currently witnessing.
Over the past decade or so, we’ve heard a lot of commentators bemoaning the fact that a lot of the nation’s best and brightest head to Wall Street. This includes a number of “quants” — the geeky math and science PhDs who head to Wall Street because otherwise they’d have a hard time eking out a living with their astrophysics degrees.
Once on Wall St., these young men and women, some of the nation’s best and brightest, put their talents to use in devising complex stock trading algorithms. The tragedy is that, if Wall Street weren’t such a big part of this nation’s life, these young scientists would be in a lab somewhere developing ideas that add to the nation’s wealth. But, given the fact that Wall St. salaries are so hard to resist, these talented young people instead spend their careers in zero-sum games where one trader’s loss is another’s gain and there is no net gain to anyone’s wealth.
The same trend is going on in the nation’s law schools. Lots of top science and engineering PhDs are abandoning their science careers and heading to law school to become patent lawyers. As patent lawyers, they generally start out making double or more what they made before.
In my own law school “section” (the contingent of your law school class with whom you take all your first-year classes), there were roughly a half-dozen science PhDs, a couple of top-notch engineers and one Harvardmathematics PhD, who had been a tenured professor at a major research university. I can’t speak to what drew these extremely talented people to law school – whether it was the potential for earning a higher salary than they could in their first careers, or whether it was intellectual interest – but I do remember feeling sad that so many truly remarkable minds were giving up careers where they might discover the cure for some disease for a career of staking out the boundaries of patent holders’ monopolies.
Allowing anyone to become a lawyer would partially drive down the salaries that lure some of our best and brightest into becoming lawyers and divert their talents into wealth-creating enterprises. It would also lower the costs for scientists who decide, after a taste of the law, that they are more suited to the laboratory. Once a lawyer-scientist has acquired six figures of student loan indebtedness, it’s hard to go back to the lab bench. If no law school were required for lawyering, the decision would be a much easier one.

Link Roundup (Now With Great Graphic!)


  • Earlier this week, I blogged some of my feelings on the death penalty. The post centered around the epistemic problem of how we can ever really know the man (or woman) we’re executing is innocent. This morning, at Above The Law, Elie Mystal blogged his own polemic against the death penalty, one that put aside the question of actual innocence of some Death Row inmates and that focused on how contrary to human dignity the administration of the death penalty is. As Mystal wrote, “The state of Georgia MURDERED an unarmed man last night, and we’re debating whether or not they considered all of the relevant evidence? We’re debating the process by which Georgia came to the conclusion it had the right to terminate the life of another man? This is what passes as civilized? Freaking Batman — who is a lawless vigilante — won’t murder a defenseless Joker even after Batman personally witnesses the Joker killing hundreds, and we applaud Batman for his heroic restraint.” Given Mystal’s position on the death penalty and his challenge to us to look the death penalty in the eye, I am sure that Mystal was happy to see the news that Texas is abolishing the customary last meal for death row inmates. The ritual of the last meal is something that makes the death penalty look a lot more humane than it is.

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