Archive for February, 2012

February 21, 2012

Wall Street can invest in Saudi Arabia, Somali packinghouse workers can’t send money home

I represent many Somali immigrants who work in meatpacking plants across Nebraska. According to the BBC, Somalis in the United States sent $100m back to Somalia in 2011. However this lifeline has been blocked because U.S. banks are afraid they will be prosecuted for sending money to Somalia because it could end up supporting  Al-Shabaab, the Somali offshoot of al-Qaeda.

The BBC reported that two Somali immigrants in Minneapolis were convicted of sending $8600 to al-Shabaab. Despite concerns over al-Shabaab receiving financial support from the United States, American intelligence officials concede that the vast majority of remittances sent by Somali immigrants to Somali nationals are for legitimate purposes.  Critics of U.S. policy argue that preventing legitimate money transfers from the United States to Somalia will do little to keep money from the U.S. from getting to al-Shabaab.

Stopping legitimate money transfers from Somalia to the U.S. is also hypocritical.  It is no secret that Saudi oil money supports terrorism.  A decade after 9/11, Saudi money is still funding terrorism. However in 2009, according to the Office of the United States Trade Representative, American companies and investors invested $8.1 billion in Saudi Arabia. Some of that money probably went to terrorists. However neither Republicans or Democrats are  going to let that inconvenient fact stop the Wall Street types who largely fund their campaigns from maximizing  their profits by investing in Saudi oil. In contrast, you would be hard-pressed to find a Somali packinghouse worker among the ranks of Super PAC funders or bundlers

In a separate article the BBC pointed out that Somalia’s private sector is doing well considering the chaotic political conditions in the country. Part of the reason for the success of Somalia’s private sector is the remittances send back by Somali immigrants — including the ones working in packing plants in Nebraska. On Thursday a major conference will convene in London on the future of Somalia.  I hope conference attendees will realize the contribution made to future of Somalia made by Somali immigrants working in packinghouses in Nebraska and the rest of the United States who send their hard earned dollars back to their home country.

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February 16, 2012

Federal oversight of collection, credit agencies could benefit civil plaintiffs

Consumer Financial Protection Bureau (CFPB) director Richard Cordray announced today that collection agencies could  be subject to federal oversight by the newly-created bureau. This is good news for people who have lost their jobs because of a personal injury, a work injury and/or a wrongful termination.  Loss of a job goes hand in hand with financial insecurity and mental and emotional distress. Any new federal regulations could give victims of injuries and wrongful terminations a bit more piece of mind if their attorneys are diligent in applying the potential new regulations.

One pro-debtor idea that has been discussed as a regulation would be heightened documentation standards for filing collections suits.  This would be a preemption argument. The Roberts Court and the Federal Courts generally favor preemption. Plaintiffs lawyers, especially the class action bar, hates preemption. I think most plaintiff’s lawyers would be wary of federal intervention in state courts. But if the Supreme Court favors preemption it makes sense for attorneys who advocate for debtors to use whatever tools are available.

According to the New York Times article, the oversight will cover the 150 biggest collection firms that comprise about 2/3rds of the market share of the collections industry. But even if an over-aggressive collection agency is not covered by the new regulations, Nebraska lawyers defending collection cases for plaintiff’s in injury and employment cases have other remedies such as the option of removing collection actions from county court into district court in order to seek injunctive relief. Lawyers in other states should also check their jurisdictional statutes to see how they can use equitable remedies in collection defense.

The CFPB also announced a proposal of credit reporting agencies. I heard a speaker at the recent AAJ Winter Convention in Phoenix mention that insurers will run credit checks of plaintiff’s firms during litigation in order to gain more leverage in settlement negotiations. If that is true it would stand to reason that insurers and employers would run credit checks on the plaintiffs themselves.  Such a tactic would likely run afoul of the Fair Credit Reporting Act and possibly create another cause of action. One practice pointer to counter such tactics would be to include questions about credit checks in written discovery.

February 2, 2012

8th Cir. upholds $53K sanction for plaintiff’s failure to cooperate with discovery

The Eight Circuit Court of Appeals upheld a sanction of $53,255.55 in costs and attorneys fees plus dismissal for a plaintiff failure to answer basic discovery requests after failing to comply with multiple court orders.

This was a case from hell. The plaintiff was suing for the defendant for a wrongful discharge case. Defendant filed a motion to compel discovery answers 10 months after plaintiff filed the complaint. Defendant was seeking information about plaintiff’s income and medical history to assess plaintiff’s damages. The court sustained defendant’s motion to compel, but plaintiff failed to provide adequate answers. Two hearings later and six weeks after the original deadline on the motion to compel, the court sanctioned the plaintiff $3000 for defendant’s attorneys fees for bringing the motions to compel.  After being financially sanctioned the first time, the plaintiff continued his failure to cooperate with discovery leading to the $53,000 sanction and dismissal of his case.

This case is an outlier, but it provides valuable lessons for lawyers who represent employees in the 8th Circuit. The first lesson is that judges will financially penalize your client severely if they do not comply with reasonable discovery requests. I’d share this decision with any client who was less than cooperative with reasonable discovery requests.

The second lesson is if your client is being sanctioned for failing to comply with a reasonable motion to compel, you need to find a way to withdraw. In Nebraska, Rule 3-501.16 of the Rules of Professional Conduct would probably allow a lawyer to withdraw in this situation for the reasons that the client failed substantially comply with an obligation to the lawyer regarding the lawyers services and that representation of the client has been made unreasonably difficult for the client. The comment to the rule states that the attorney needs to warn the client that failure to cooperate will lead the lawyer to withdraw and could also lead to the possibility the client having to represent themselves in their case.  Another practice pointer for trial lawyers is to make cooperation with reasonable discovery requests part of the fee agreement.

The bottom line is that it’s a waste of everyone’s time to bring a suit for a client who won’t cooperate in the process.  Cut your losses and get rid of troublemakers because as plaintiff’s lawyers we need to spend time on deserving clients, spend time serving our community and enjoying time with our family and friends.