Saturday, July 14, 2012

Class-Action Lawsuits

A report in the July 11, 2012 National Post (Lawyers get best seats in Ticketmaster class-action) gives the impression that lawyers in class-action suits operate out of altruism. Yes, the plaintiffs pay no legal fees. Yes, the action may fail and the lawyers assessed costs which they will pass onto their clients. The report does not mention that lawyers may insure against such loss.

If it's all that risky, why do lawyers swarm all over accident and disaster sites, nudging each other to instigate lawsuits and sign up plaintiffs? The pot of gold at the end of the class-action rainbow is a big one.

Another report tells us that the Merchant Law Group of Regina, Saskatchewan, reaped $25-million from the $1.9-billion Indian Residential Schools settlement. In unusual candour, lawyer Tony Merchant said, "I hate to lead myself into doing things that aren't profitable, and I hope to be pleasantly surprised [by his latest class-action suit]. I'd be shocked if this turns into anything but profitable."

(In April 2013, it seems Tony Merchant has $1.7-million in a secret account in in the South Pacific Cook Islands. This, according to the Washington-based International Consortium of Investigative Journalists, which also claims that Merchant has money in Bermuda with which he bought mutual funds in the tax haven of Luxembourg. The investigation continues.)

In the lawsuits following the 2010 G20 meeting in Toronto, shameless, publicity-seeking lawyers make sure the media are there when they present their claim at police headquarters, dragging their clients along to add to the spectacle. It is unnecessary for clients to be present on such occasions.

In another widely reported case, the plaintiff had no intention of a law suit until convinced otherwise by lawyers trolling the Internet for business. The public calls this fee-sniffing, ambulance chasing, and other less charitable terms. The Law Society of Upper Canada, the lawyers trade association in Ontario, approves of such behaviour. Inciting legal action was once considered unethical, if not illegal. How the winds of profit have changed.

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