W.Va. drops a spot, still the No. 2 'Judicial Hellhole'
12/15/2009 8:00 AM By John O'Brien -Statehouse Bureau

WASHINGTON -- The American Tort Reform Foundation was less critical of West Virginia's legal system this year, but still ranked it as the No. 2 Judicial Hellhole in the country in its annual report released Tuesday.

The ATRF dropped West Virginia from the top spot, citing what it says is an improved relationship between state Supreme Court justices and reform efforts by Gov. Joe Manchin. The report commends the commission created by Manchin to explore a different method of selecting judges in its "Points of Light" section.

Retired U.S. Supreme Court Justice Sandra Day O'Connor served on the commission, which recommended probing the establishment of a business court.

"The commissioners deserve a great deal of credit for the thoughtful roadmap they have provided to West Virginia policymakers," the report says.

"Economic growth and job creation have been stymied in the Mountain State because of its courts' reputation among business leaders. Fearing unfair trial court decisions, and frustrated without a guaranteed right to appeal those decisions, too many businesses and companies leave the state or choose to avoid it altogether in the first place.

"West Virginia trial judges know that there is a high probability that their cases, however extreme, will not be challenged on appeal. This creates the wrong incentives for fair and impartial decision making."

Still, the ATRF says more action is needed.

"The recommendation is praiseworthy. But until West Virginia adopts systemic reforms or shows consistent evidence of fair rulings, it is unlikely to shed its reputation as a Judicial Hellhole," the report says.

It lists four reasons why the state continues to be ranked as a Judicial Hellhole every year:

First is the lack of an intermediate court of appeals. Forty-eight other states have such courts, and three of five Supreme Court justices must agree to hear an appeal.

"While the West Virginia Supreme Court of Appeals opts to hear one of every three cases for which review is sought - a high percentage for discretionary review53 - this provides little solace to parties who receive no appeal at all," the report says.

"This has occurred even in cases involving hundreds of millions of dollars in punitive damages, as well as trial court decisions permitting novel and constitutionally questionable practices."

Second is a "fact-based perception" that the state judiciary views in-state plaintiffs in a better light than out-of-state corporate defendants. The report cites former state Supreme Court Justice Richard Neely.

"As long as I am allowed to redistribute wealth from out-of-state companies to in-state plaintiffs, I shall continue to do so," Nelly wrote.

"Not only is my sleep enhanced when I give someone else's money away, but so is my job security, because the in-state plaintiffs, their families and their friends will re-elect me. It should be obvious that the in-state local plaintiff, his witnesses and his friends, can all vote for the judge, while the out-of-state defendant can't even be relied upon to send a campaign donation."

Third is procedural unfairness that forces defendants to settle cases that lack merit. The report is critical of consolidating thousands of individual cases against out-of-state defendants and permitting "unorthodox trial plans that have a fact-finder consider whether the defendant's conduct warrants punitive damages even before certifying a class or determining compensatory damages."

And last are departures from the core principles of tort law. Those departures include medical monitoring claims that punish defendants in cases where no physical injury is alleged, the state Supreme Court's rejection of the learned intermediary doctrine and allowing tort claims out of the Workers' Compensation system.

By refusing the learned intermediary doctrine, the state Supreme Court required drug companies to notify all users of any possible side effects. Forty-seven jurisdictions have ruled that physicians (learned intermediaries) have some responsibility to do so.

Federal courts in West Virginia had applied the doctrine before the state Supreme Court decision. Then-Chief Justice Robin Davis called it a "useless 82-year-old relic."

And in 2007, DuPont was ordered to pay $130 million in medical monitoring for Harrison County residents who lived near one of its zinc-smelting plants.

As usual, the report explores state Attorney General Darrell McGraw's relationship with private lawyers. He has given state contracts to lawyers who contribute to his campaign without soliciting bids from other firms.

Private attorneys represented the State in litigation against OxyContin-maker Purdue Pharma, leading to a $10 million settlement in which they earned more than $3 million.

McGraw did not distribute the rest of the settlement to the state agencies named as plaintiffs, instead using it on day report centers. He also gave $500,000 to the University of Charleston for a pharmacy school.

Recently, the Departmental Appeals Board ruled the federal Centers for Medicare and Medicaid Services was owed $2.7 million from the settlement. CMS has taken the amount from the state's Medicaid program.

"McGraw does not provide an open and competitive bidding process to select law firms, opting instead to base the decision on personal preferences," the report says.

"Such a process not only risks depriving the state of the best possible use of taxpayer dollars, but is prone
to a perception of unfairness and cronyism. His office keeps the settlement money, which is doled out to his favorite causes.

"Moreover, the plaintiffs' lawyers hired to represent the state receive lucrative fees from the litigation. In turn, many donate heavily to McGraw's reelection campaigns. Over this time, the Attorney General's symbiotic relationship with the plaintiffs' bar has only grown more entrenched."

From the ATRA's own website: "Founded in 1986, the American Tort Reform Association (ATRA) is a broad-based coalition of more than 300 businesses, corporations, municipalities, associations, and professional firms that have pooled their resources to promote reform of the civil justice system with the goal of ensuring fairness, balance, and predictability in civil litigation."

And poor ol' Joel thinks this is a credible source for defining WV or any other state a judicial hellhole. Gives as much credibity to Joel's comments if he believes this is a legitimate source.

Just what is a legitimate source in your estimation? The need of another appellate court in the state has been commented on for years ,long before Joel arrived.

ATRA is a front for the tobacco industry. The "broad based support" claim is hogwash.

First, quoting a former Supreme Court Justice (Neely) who has not been on the bench for over 15 years is hardly compelling.

Second, the concern over medical monitoring cases is equally misplaced. Other states permit these claims. Let me explain: ATRA's concern is that "you don't have to prove an injury to make a claim". This often arises in exposure to toxins cases where it is claimed that a corporation did not take appropriate steps to protect those who work or live in or around the business from exposure to toxins. Many such toxins cause cancer. Our court decided, quite correctly, that you don't have to prove you have cancer, but that the "injury" was having to see a doctor every year to monitor whether you have cancer. That way you could catch the cancer early and perhaps survive for your family and children. The "medical monitoring" involves costs, like tests and office visits. One should be able to seek compensation for that, don't you think?

Finally, the concern over class action fairness actually reveals where this group is coming from, the tobacco interests. Now why would the tobacco companies be worried about class action fairness? Is it because they juiced their products to be addictive and then lied to Congress about it? A group deserving of our sympathy if there ever was one.

Joel, sometimes your criticisms of WV are appropriate. Citing this dubious report to support another criticism misses the mark in my book.

Thanks to all,

When I post information like this it is to elicit a response from anyone out there about the validity of the article. I do not necessarily endorse what I post, but just want to bring it to your attention.

If indeed the bottom line is that some businesses will not locate in this state because of the legal ramifications then the enitre State of WV loses.

Yes, perhaps an intermediate Appelate Court might improve the situation.

But if anyone wishes to attack me about my stance on anything that, too, will be fine. I will read and contemplate any reasoning or facts you wish to post. Of course this does not mean that I will agree with you.

Many in the past have added to my knowledge of subjects. Please continue doing this.

This information is in the book "Unleashing Capitalism" which was reviewed slightly on E-Tater perhaps a year ago. The Librarian got the book for the library. Also, a counter argument ,written by two law students appeared on E-Tater later. My details are sketchy,but the students found that WV does not deserve the name of "Judicial Hellhole" because it has fewer cases per capita than nearly any other state and the awards are lower. They demolished the argument that was used in "Unleashing Capitalism", written by a WV U professor.I do not have my notes handy at the moment,and am writing from memory which may be faulty. But it is good to read the pros and cons on E-Tater written by knowledgeable and intelligent people. Thank you Joel and Slaty Fork.

Joel, I looked at your post again and agree there is no indication of your endorsement of the article. Like you I enjoy reading intelligent posts, whether I agree or disagree. I consider your posts worth reading. I should not have presumed you endorse the findings in the article.

Here is a quote from today's Gazette:
""The Center for Justice & Democracy, a nonprofit, nonpartisan consumer advocacy group based in New York, says in a news release that ATRA's members "are largely Fortune 500 companies with a direct financial stake in restricting lawsuits," including representatives from the tobacco, insurance, chemical, auto and pharmaceutical companies."

It is always important to understand who these groups are who claim to be "grassroots, broad based, and widely supported"

That is not needed in this state. Find out from your legislators how much an intermediate appellate court would cost the taxpayers. It will shock you. Also ask anyone connected with the WVA Supreme Court about their caseload. They take less than half of the cases they used to review ten years ago. They take at least 13 weeks of vacation. I spoke with a former Supreme Court Justice and he told me the workload is a joke.