Soaring healthcare costs are turning the heat up on disputes between health care providers and insurers, says Hon. P. Oswin ("Os") Chrisman (Ret.) and Cecilia H. Morgan, Esq., both mediators and arbitrators with ADR provider JAMS, The Resolution Experts, in Dallas. "Within the health care industry, fingers are pointing in every which way to explain rising costs. There is a lot of stress on the system and a lot of tension being felt from all sides," Chrisman says. "Doctors point at insurers, as reimbursements are shrinking and denials on coverage have jumped in recent months." It's been five years since 700,000 physicians and state medical groups sued the largest insurers in Texas, claiming they had intentionally obstructed delayed and denied payments and reimbursements to providers. Some individual settlements reached are set to expire this year, and more confrontations may be set to ignite, says Morgan. "Mediation is an approach that can limit the costly courtroom battle and instill proper safeguards to alleviate the pressures for the parties. Taking an early mediation approach is the best route for doctors and insurers alike," she says. Ms. Morgan and Judge Chrisman are available to discuss and write on what every doctor should know when using mediation to address disputes in the healthcare industry. Judge Chrisman served for 13 years in the district courts of Dallas, and was Past Chair of: the Texas Institute of Health Research; Baylor Health Care Systems, Inc.; Baylor University Medical System; and the Mental Health Associations of Dallas County and Texas. Cecilia Morgan, Esq. is a former commercial litigator and frequently resolves healthcare disputes. [08/21/2008]

The nature and operation of the implied warranty of habitability in connection with residential real estate sales contracts, is something that every prospective home buyer and developer should understand, says Steven Welhouse, a real estate attorney at Levenfeld Pearlstein LLC (Chicago). "These warranties exist in every residential real estate contract, but many disputes that arise between developers and buyers are the result of one or both parties not understanding the characteristics of such warranties. When buyers raise issues, it is common for developers to use a variety of methods to attempt to disclaim implied warranties, however, developers must protect themselves from unfounded claims by understanding the factors that constitute a valid disclaimer under most state laws. The problem is that while many of these factors are well-defined, others are often quite vague." This article will focus on these ill-defined factors and discuss those which should not be considered valid, and others which should be more clearly defined by the courts.

In an increasingly litigious society, most healthcare practitioners carry two types of liability insurance. One form, professional liability insurance, covers injuries that occur to patients during the course of treatment. The second type, comprehensive general liability coverage (CGL), insures liability claims related to slips and falls and similar injuries that occur on the property of a healthcare facility. In some instances, the applicable coverage is clear. Often times a grey area exists, however, in circumstances where patients suffer injuries that are akin to a premises liability injury, but which happen, arguably, during the course of medical treatment. "The question of which policy responds to a patient injury depends on the particular facts of each injury and has led to decisions by courts that appear, at first glance, to be inconsistent," says William Carter, a partner in the Insurance Coverage Practice of Washington, D.C.-based Carr Maloney P.C.. "Healthcare professionals would be wise to have both types of policies in place to respond to claims for injuries to their patients." Carter and his colleague James P. Steele have authored a ready-for-publication article that defines the professional liability and CGL policies and provides a recap and analysis of related court rulings. [05/15/2008]

The Durable Power of Attorney for Property (DPAP) is one of the most overlooked pieces of an estate plan, but it is also one of the most useful and essential tools. The main purpose of a DPAP is to allow an individual to appoint someone as his agent to manage his financial assets in the event he becomes physically or emotionally incapacitated. While the two most common methods for dealing with a disabled person's assets are guardianship and the use of a funded revocable trust, a DPAP can be tailored to specifically allow the agent to re-title the principal's assets in the name of the revocable trust in the event of the principal's disability, making it a vital component of any estate plan. "While the DPAP should not be relied on as the sole protection against disability and is not and should not be the sole document in one's estate plan — it is most effective when included in a comprehensive plan," says Stuart Kohn, a partner in the Asset Planning and Preservation Service Group at Levenfeld Pearlstein LLC (Chicago). "At the same time, an estate plan is not complete unless it includes a DPAP, as there are certain situations that only be addressed with a DPAP, short of full guardianship proceedings." Mr. Kohn's article will explain why every comprehensive estate plan should include a DPAP and will discuss the process by which one can be implemented. [04/24/2008]

International businesses are continuing to arbitrate the vast majority of their international disputes in this intensifying global marketplace. There are, perhaps, twenty or so competing sets of rules that can be applied to arbitrations on the international level. "A best practice approach to the rules of arbitration on the global level is essential to ensure efficiency and continued growth of this important dispute resolution process", says Robert B. Davidson, a full-time arbitrator and mediator at JAMS, The Resolution Experts, and Executive Director of JAMS Arbitration Practice. The Vienna Vis Moot Court Competition in Vienna this month used the JAMS International Arbitration Rules for the hypothetical problem argued by over 200 law school teams from all over the world. "The JAMS Rules have several unique features intended to streamline the arbitration process and to meet certain problematic situations encountered with greater frequency in modern arbitration practice," he says. "For example, the suggested JAMS arbitration clause, used in both the international and domestic arbitration rules, adds a key phrase to make it "unmistakably clear" that the parties intended to arbitrate questions of arbitrability in accordance with the U.S. Supreme Court rule established in the case of First Options of Chicago v. Kaplan. They also provide that the arbitrators are to decide whether a contract has been formed at all. These provisions discourage court interference either at an early stage of the proceedings or after an arbitration has been commenced," says Davidson. "The doctrine of First Options has sometimes proven to be a trap for the unwary in cases involving U.S. parties, or in proceedings that require recognition and enforcement of awards in the United States." Davidson is available to write on the importance of various international arbitration rules provisions and on the process generally. [03/27/2008]

As arbitration has grown from a little-used alternative to litigating smaller matters, to a tool now regularly used to settle disputes of $100 million or more, many wonder what implications this growth has for its future. "All this growth has brought us to a real crossroads in the life of large-case arbitration. What lies in arbitration's future is completely dependent on how well we deal with a highly significant result of this growth — the ever-increasing complaint that arbitration is becoming too much like litigation," says John Wilkinson, a mediator with JAMS, The Resolution Experts (New York). Fortunately, says Wilkinson, the core ethos that drives the arbitration community means that, as the use of arbitration grows, it will be able to address the challenge it is simply litigation in another guise. "Arbitrators have the tools to strike the right assertive tone to ensure cases are resolved much less expensively and in much less time than if they had been litigated in court. At the same time, arbitrators know they must be sufficiently patent and restrained to ensure that there is enough of a process — especially discovery and review of evidence — to permit a fair result," says Wilkinson. His article, which outlines how the future of arbitration will address the challenges raised by recent growth, is available for publication. [03/20/2008]

With the recent spate of private equity acquisitions in which the target company's senior management is often so closely involved — it was only a matter of time before the courts were asked to weigh in on how these deals work. "The Delaware Court of Chancery has lately issued a series of decisions that confront the special conflicts and resulting fiduciary issues that frequently arise with private equity MBOs," says Donald J. Wolfe, Jr., a partner in the Corporate Litigation Practice Group at Potter Anderson & Corroon LLP (Wilmington, Del.). Wolfe has written an article analyzing these decisions that is available for publication. He says the court appears to be taking a critical view of private equity MBOs. "The language of these opinions ventures beyond the mere insistence that directors adhere to the standard of an objective and reasonable auctioneer, seeming instead to focus on inherent conflicts of interest arising from management's participation on the sell side. In fact, they appear to reflect a degree of judicial suspicion and scrutiny that, although arguably justified, seems of a sort more typically reserved for circumstances that invoke entire fairness review." Wolfe's article is available for publication. [02/28/2008]

A recent decision by the Second Circuit, welcomed by the defense bar, heightens the evidentiary standard plaintiffs must satisfy in order for a court to certify a putative class of investors. While this ruling appears to be a victory for the defense bar, some plaintiff's lawyers have noted a potential silver lining: Because class certification is becoming entwined with the merits, plaintiffs now feel justified in asking for — and possibly getting — merit-based discovery in connection with their class certification motions. "This may benefit plaintiffs who get to delve into fact discovery sooner, but means that decision on class certification will likely be pushed out later in the life of the litigation," says Lanier Saperstein, a senior associate in the Corporate and Commercial Litigation Practice Group at Allen & Overy LLP (New York). He continues, "Indeed, anecdotal evidence from pending class actions suggest that class certification and summary judgment motions are heading towards being decided roughly at the same time, which is often years into the litigation." This lengthening trend contributes to and exacerbates the problems caused by a parallel trend in class actions, namely, investors increasingly opting out after class certification or settlement and instituting their own actions. Because class certification motions are being pushed out further into the life of litigation, the costs associated with any eventual opt outs increase significantly. Therefore, while plaintiffs and defendants may argue for years about who is the beneficiary of the IPO decision, one thing appears to be clear: The lengthening trend caused by the merging of fact and class discovery will lead to problems caused by the opt out trend, ultimately negatively impact the class action system. Saperstein is available to write an article outlining the details of this decision and its impact on the judicial system. [02/14/2008]

Europe presents a challenging litigation environment, both legal and procedural, with respect to biotech patents. Proposed changes could also profoundly impact the filing strategies used by companies in Europe. "The most fundamental of these changes are the establishment of a Community Patent as well as an integrated patent litigation system, with both perhaps moving forward in 2008," say Matthew Royle, Gareth Morgan and Simon Cohen, attorneys with Taylor Wessing (London). Given that, if either of these changes came into effect, it would mean prosecuting and litigating biotech patents under a completely new, untested regime, companies are closely examining their filing strategies to take advantage of the existing system. Currently, European patents are national rights and must be challenged in national courts, which differ in patent interpretation and procedure. Decisions in certain countries — such as the Netherlands, Germany, and the UK — might hold greater precedential weight in other European member states and may be used as ammunition in subsequent proceedings. "Some large companies are increasing their use of the national route, which offers both security and familiarity," say Royle, Morgan and Cohen. "In addition, the Biotech Directive has been, at least partially, implemented by all member states and it remains to be seen whether it will be interpreted consistently in all member states. The interpretation of the Directive will be another important factor in the strategy of litigating biotech patents in Europe." Royle, Morgan and Cohen are available to author an article outlining what's involved in litigating biotech patents in Europe, the potential impact of coming changes, and the filing and litigation strategies companies should consider. [02/14/2008]

Nearly one year has passed since the U.S. Supreme Court issued its decision in United States v. Twombly, limiting plaintiffs' ability to bring speculative antitrust claims than at lead to expensive discovery and ultimately, antitrust litigation, by announcing a new pleading threshold for claims under Section 1 of the Sherman Act. "At the time of the decision, many speculated that the Court's decision would provide antitrust defendants with an important tool with which to secure the dismissal of frivolous antitrust claims," notes Matthew Freimuth, an attorney in the Global Competition Practice Group at Hunton & Williams LLP (New York). "Whether this has actually come to fruition in the last year is something that must be more closely examined." Mr. Freimuth is available to write an article which reviews several of the key decisions relying on Twombly from the past year and assesses the early impact of the Supreme Court's decision. The article will consider, from a practical perspective, whether the Twombly decision has indeed resulted in rulings favorable to defendants' efforts to dismiss Section 1 claims. [02/14/2008]

May be sign of things to come

The Canadian Patent Office (CPO) has recently changed its position regarding the patentability of electromagnetic and acoustic signals, in a move that may be a sign it is further limiting its view of what new technologies embody patentable subject matter. "The CPO has stated that electromagnetic and acoustic signals are forms of energy, do not contain matter and therefore do not constitute patentable subject matter. Further, the Patent Office elaborates that signals are not encompassed by the existing categories of patentable subject matter," says Robert H. Wilkes, an attorney with the intellectual property law firm Ridout & Maybee LLP (Toronto). Signal claims have been used, in conjunction with process and apparatus methods, for claiming subject matter and protecting software and related inventions. "It is therefore disconcerting that the CPO may limit the use of signal claims as a potential tool to cite against infringing parties, especially those that may operate or take advantage of signals in only a portion of the transmit and receive path, and absent the claimed method or apparatus," says Wilkes. He notes that the U.S. Patent Office has also recently moved to limit signal claims, and the recent case In Re Petrus ACM Nuijten supported this position; although there is a strong dissenting opinion that provides some hope to patent professionals. Wilkes is available to write an article outlining the changes in Canada regarding signal claims, what inventors need to know, and the strategies they should employ in light of the new situation. [02/14/2008]

Over the past decade, genetic testing has revolutionized the practice of criminal law — and now seems poised to do the same for toxic tort litigation. "It is too soon to tell how far these advances will carry the law of toxic torts, but the changes have already begun," says Anthony Hopp, a defense litigator with Wildman Harrold LLP (Chicago) who focuses his practice on toxic tort matters. "It is now possible to test plaintiffs for unique genetic susceptibility to the effects of toxic substances. It is also possible to prove toxic exposure by looking for DNA damage. A new theory is emerging that injury on the molecular, genetic level could support a cause of action." Hopp is available to write an article reviewing the current uses of genetic testing in the context of toxic tort litigation. It will examine the way in which some of this new testing clashes with established tort principles and the hurdles that trial lawyers will face as they seek to admit these new types of evidence. It will conclude with some predications about how the science of genetics will, and will not, change the practice of toxic tort law over the next decade. [01/24/2008]

It's a conundrum for lawyers who work with clients on anti—counterfeiting programs: how to guide them through a sting operation without compromising ethical obligations. "Sting operations are a key element of any anti—counterfeiting initiative, but they do pose ethical concerns for lawyers," says Brian W. Lewis, a litigator with Wildman Harrold LLP (Chicago) who develops and implements anti—counterfeiting programs for clients such as the electronics manufacturer Square D. "At any one time you could be in contact with someone who you are or will be in litigation with, and you also don't want to be involved in making untrue statements, having agents make untrue statements, or entrapment." Lewis says it's important for attorneys to establish the ground rules for a sting operation before it happens to ensure they follow ethical rules while also properly representing their client. He is presently writing an article on the legal ethics of sting operations and is available to discuss ways to ensure the ethical compliance of a sting operation. [12/06/2007]

Despite the fact that the U.S. Supreme Court ten years ago rejected medical monitoring - where healthy individuals are awarded damages after possible exposure to hazardous substances in order to undergo screening tests for problems they may never develop — as a cause of action, a recent spate of verdicts and settlements in several states seems to have revived interest in pursuing these claims. "Medical monitoring wastes judicial and societal resources, and it debases the court system by allowing uninjured plaintiffs to seek compensation for medical tests most will never undergo," says Anthony G. Hopp, a defense litigator with Wildman Harrold LLP (Chicago). "Our tort system is based on the premise that people deserve compensation for actual, physical injuries that are negligently or intentionally inflicted. Awarding damages to a person who has suffered no harm and who has incurred no actual damages represents a sweeping change in our system of tort law," says Hopp. He is available to write an article that discusses why medical monitoring is bad medicine, bad policy, and bad law. [11/15/2007]

Investors in United States commercial real estate now face a "chilled" financing environment, with many mortgage lenders moving to the sidelines and others requiring higher interest rates and offering lower loan proceeds. "As a consequence of this environment, cash purchasers, particularly those with cash denominated in Euros or purchasers needing lower levels of financing, currently possess a significant economic advantage for acquisitions in the U.S. and have an opportunity to strike very favorable terms with both sellers and lenders," says Charles Lansden, a partner in the Real Estate Practice at Katten Muchin Rosenman LLP (Charlotte, NC). "The chilled market has in large part resulted from a dislocation in the market for commercial mortgage backed securities (CMBS). Investors in CMBS have responded to the crisis in the market for residential mortgage-backed securities, supported in part by sub-prime mortgages and by demanding greater compensation for the perceived heightened risk posed by the commercial mortgages underlying the CMBS." As a result, CMBS lenders have "re-priced" their loans to meet the stricter criteria now being imposed by CMBS investors, with prospective purchasers of U.S. commercial real estate now faced with limited interest-only periods, lower loan-to-value ratios, higher required debt service coverage ratios, and tightened loan covenants. Mr. Lansden is available to write an article for publication discussing the influence of the CMBS market on U.S. commercial real estate and which investors are poised to take advantage of current market conditions. [09/13/2007]