West Virginia Business Litigation Blog

West Virginia Business Litigation Blog

Developments in Business & Commercial Litigation

Indicted CEO’s Lawsuit Seeks Payment of Attorneys’ Fees

Posted in Attorney Fees, Corporations, Criminal Litigation

Last November, the government indicted Don Blankenship, the former CEO of Massey Energy, for conspiracy to violate the Mine Safety and Health Act at Massey’s Upper Big Branch mine, where 29 miners died in an explosion in April 2010; conspiracy to defraud the United States by concealing mine-safety violations at UBB; making a false statement to the Securities and Exchange Commission based on a company statement to shareholders; and securities fraud as a result of a company statement to shareholders and a company press release. The charges provide for a total of 31 years in prison.  Blankenship is represented by William Taylor III of Zuckerman Spaeder LLP and Spilman Thomas & Battle, PLLC  as local counsel.

Not surprisingly, given the stakes on both sides, the case has already generated a massive amount of activity. (Although PACER lists all the docket entries for the case, for most, you can’t

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Apparently No One Likes AT&T’s Arbitration Requirement, Including AT&T

Posted in Litigation

Let me see if I understand this. In AT&T Mobility LLC v. Concepcion, 131 S.Ct. 1740 (2011), decided by the United States Supreme Court in April, the Court held in a 5-4 decision that the Federal Arbitration Act preempted California’s judicial rule prohibiting class-wide arbitration waivers, such as AT&T’s, on the grounds they were unconscionable. So AT&T’s position, endorsed by the Court, was that a consumer must (1) arbitrate, not litigate, his or her claim against AT&T; and (2) may not arbitrate as part of a class, but must do so as an individual.

The decision attracted a tremendous amount of commentary and analysis about its effect on the viability of class actions. For a sampling, here is a post by the firm of Morelli Ratner that collected ten of the best posts on the decision; a detailed discussion from the employer’s perspective by Seyfarth Shaw’s

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WV Supreme Court Clarifies “Alternate Forum” Requirement in Doctrine of Forum Non Conveniens

Posted in Appellate Decisions

Late in its January Term, the Supreme Court of Appeals of West Virginia issued a decision dealing with the well-known, but somewhat misunderstood, or at least misapplied, doctrine of forum non conveniens. In essence, the doctrine allows a court to decline to assert jurisdiction over an action before it if another, more appropriate forum exists for its resolution.

In Mace v. Mylan Pharmaceuticals, Inc., 2011 WL 2446644 (W.Va., June 16, 2011), Kathy Mace, a North Carolina resident, died on October 25, 2005, allegedly due to an overdose of fentanyl, a narcotic pain medication. Her personal representative filed suit in Monongalia County, West Virginia on October 1, 2008 against Mylan Pharmaceuticals, Inc.,  Mylan Technologies, Inc., and Mylan, Inc. The first two are West Virginia corporations, while the third is a Pennsylvania corporation. 

Ms. Mace’s estate alleged that the Mylan defendants were responsible for designing, manufacturing, marketing, and distributing the fentanyl pain patch, and alleged claims for strict products liability, negligence, breach of implied and express warranties, and punitive damages.

Apparently, Ms. Mace’s estate sued a California generic drug manufacturer for her death, and learned through that litigation learned that the Mylan defendants actually manufactured and distributed the fentanyl patch. But by the time the estate filed suit in West Virginia, the two-year statute of limitations for wrongful-death claims had expired. (North Carolina also has a two-year statute of limitations for wrongful-death  claims, which will feature prominently in the court’s decision.)

The Mylan defendants moved to dismiss on the grounds on the grounds of forum non conveniens, and argued that North Carolina was the appropriate forum for the lawsuit because Ms. Mace lived there, wore the patch there, and died there, and that the patch was shipped to North Carolina from Mylan’s plant in Vermont.

Ms. Mace’s estate argued that because West Virginia permits tolling the statute of limitations based on the discovery rule, while North Carolina does not, the estate could not pursue the lawsuit in North Carolina unless the Mylan defendants waived their statute of limitations defense. Absent that waiver, North Carolina was not available as an alternative forum for the lawsuit.

The Circuit Court of Monongalia County dismissed the lawsuit on December 16, 2008 based on forum non conveniens, and found that North Carolina was an alternate forum in which the Mace estate could bring the action. The court also found that the Mylan defendants had agreed to consent to and not contest personal jurisdiction in North Carolina and would waive their statute of limitations defense.

But apparently the Mylan defendants did not remember it that way. A couple of months later, they moved to amend or clarify the order on the grounds that they had agreed to waive any new statute of limitations defense, but maintained that they should be able to assert the defense as to the estate’s West Virginia action. In response, the estate moved to reinstate the case in circuit court on the grounds that if the Mylan defendants obtained their relief, the case could not go forward in North Carolina, as that statute of limitations had expired before the lawsuit had been filed in West Virginia. 

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The Honorable M. Blane Michael 1943-2011

Posted in Courts

The Honorable M. Blane Michael, a judge on the United States Court of Appeals for the Fourth Circuit and one of the most illustrious members of  West Virginia’s legal community, died yesterday. Here is the story in the Saturday Gazette-Mail and his biography on the Fourth Circuit’s website. The Washington Post has this story from the Associated Press.

Judge Michael received his undergraduate degree from West Virginia University, where he was student body president, and got his law degree from New York University. To say he then enjoyed a varied and interesting career is an understatement.

Following his graduation from law school in 1968, he was in private practice in New York City, then served as an AUSA for the Southern District of New York.  He came back to West Virginia in 1972, where he was an special AUSA

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Corrected Links for February 26, 2011 Post

Posted in Appellate Decisions

The link to the National Law Journal article referenced in yesterday’s post may require you to register for the site, which is free, rather than take you to the article. This link should work.

Also, the alleged link to the Kentucky Court of Appeals’ docket sheet takes you to the court’s site, where you can search for information.If you want to review the docket sheet, you can enter any of these case numbers and be taken there: 2007, CA-001971; 2007-CA-01981; 2007-CA-002173; and 2007-CA-2174.

Sorry for the confusion.

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Kentucky Appellate Court Reverses Summary Judgment Against Fen-Phen Lawyers Based on (Disavowed) Affidavit from Kenneth Feinberg

Posted in Appellate Decisions

In the course of writing about Stan Chesley’s travails, I was curious to find out what happened in the case described in the final paragraph of the National Law Journal’s story about Chesley:

Earlier this month, the Kentucky Court of Appeals vacated a $42 million summary judgment in favor of the 431 fen-phen plaintiffs against Chesley, Cunningham, Gallion and another attorney in the case. The court said that the lawyers had presented an issue of triable fact regarding their handling of legal fees. The decision came after Kenneth Feinberg retracted an affidavit supporting the attorneys’ position. Feinberg is the attorney presiding over the BP oil spill settlements.

Here is the Kentucky Court of Appeals’ decision in Cunningham v. Abbott, 2011 WL 336459 (February 4, 2011, Ky. App.), which, as the article described, relied on Feinberg’s affidavit in reversing the Fen-Phen plaintiffs’ summary

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“Master of Disaster” Faces Possible Disbarment for Role in Kentucky Fen-Phen Settlement

Posted in Attorney Fees

Over the next few posts, I want to follow up on some earlier posts and also talk about Supreme Court of Appeals decisions that, for one reason or another, I have overlooked.

You may remember that a couple of years ago, as a result of criminal charges that a trio of plaintiffs’ lawyers took an extra $65 million from the settlements of 440 plaintiffs they represented in Fen-Phen litigation, two of the lawyers, Shirley A. Cunningham, Jr. and William J. Gallion, were found guilty and were sentenced to 25 years and 20 years, respectively, in federal prison. The third lawyer, Melbourne Mills, Jr., was acquitted. (To make matters worse — if that’s possible — Joseph A. Bamberger, the Kentucky state court judge who approved the settlement, including the outrageous attorney’s fees — and also benefited financially from the settlement in a secret deal — resigned in 2006 rather than be removed

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Huffington Post Lawsuit Shows Why You Have to Assert Claims on a Timely Basis

Posted in Contracts

Chances are you’ve visited or at least heard of The Huffington Post, the eponymous blog and news-aggregation site started by Arianna Huffington and others, which has expanded to include in-depth coverage on an ever-growing number of subjects.

In the February issue of Vanity Fair, William D. Cohan writes about a dispute over who is responsible for the success of HuffPost, which Cohan says is worth an unconfirmed $350 million, based on projected 2011 revenues of $60 million.

The background is that Democratic political operatives Peter Daou and James Boyce maintain that they were involved in the creation and development of HuffPost, along with Huffington and Ken Lerer, who provided financing for the site, but never received any credit or equity or compensation for their efforts, particularly after HuffPost became so successful. Both continued to write for the site, however, which started in 2005.

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WV Supreme Court Provides Additional Information Online, Will Address Scope of Nursing Homes’ Arbitration Provisions

Posted in Appeals

In my post from a couple of weeks ago about the implementation of the Revised Rules of Appellate Procedure at the Supreme Court of Appeals, I neglected to mention a couple of other changes.

First, you’ll see on the calendar that in addition to the links for argument dockets, there are now links to Order Lists, which are released at various times during the month. Here is the Order List from January 14, which indicates the Court’s rulings on petitions for rehearing, motions for argument in Rule 19 and 20 appeals, and other orders of note. The order may indicate the vote, if one was taken, and a summary of the Court’s action, if appropriate.

Also, on the main Opinions page of the Court’s website, in addition to the link to Current Term Opinions, there are now separate links to Orders (the Order Lists described above)

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Virginia Federal Court Declines to Apply Ashcroft v. Iqbal to Defendant’s Pleading

Posted in Courts

H. Scott Johnson, Jr., one of the authors of the Virginia Business Law Update, wrote last week about a recent Virginia federal court decision which held that Ashcroft v. Iqbal, 129 S.Ct. 1937 (2009), does not apply to a defendant’s affirmative defenses. Iqbal, you will recall, is the United States Supreme Court’s decision that "requires that allegations in a claim for relief include enough factual matter, taken as true, to plausibly suggest an entitlement to relief." For some background, I refer you to this post on Iqbal‘s holding and this one on the Fourth Circuit’s application of Iqbal.

In denying the plaintiff’s motion to strike the defendant’s affirmative defenses in Lopez v. Asmar’s Mediterranean Food, Inc., 2011 WL 98573 (E.D.Va. 2011), Senior Judge James C. Cacheris of the Eastern District of Virginia found that because Rule 8 of the Federal Rules of Civil Procedure requires

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