Over the past month, the judicial process has unearthed a number of troubling instances or implications of fraud in high-profile civil litigations.  Those of us who view mass tort litigation as a profit-seeking, largely unregulated industry will react like Casablanca‘s Captain Renault who was shocked, shocked to find gambling going on at Rick’s.  But other than a few stories in the business and legal press, the public likely knows little or nothing about, for instance, the unseemly actions of U.S. lawyers in a $27 billion environmental lawsuit in Ecuador (more on that in a moment).  Or about last month’s first-of-its-kind jury verdict in a Mississippi federal court finding that two lawyers committed fraud in an asbestos suit.  The jury imposed $420,000 in actual and punitive damages on the lawyers.  Those two lawyers had successfully pursued six-figure settlements from defendant Illinois Central Railroad in 2003 even though they knew their clients had received seven-figure settlements in other asbestos suits in 1995.  Those settlements took their 2001 claims against Illinois Central beyond the three-year statute of limitations.  A Corporate Counsel article has more details.

Washington Legal Foundation hosted a Web Seminar program (archived video accessible here) last week which featured three attorneys directly involved in prosecuting the fraud case on behalf of Illinois Central Railroad: Daniel Mulholland of Jackson, Mississippi’s Perry Forman; Janet Gilbert of Chicago’s Fletcher & Sippel; and Paul Cunningham of D.C.’s Harkins Cunningham.  The participants not only provided a fascinating account of the case and the issues on which its successful outcome turned; they also offered lessons for defendants fighting against abusive litigation.

In Chevron’s case in Ecuador, just last week an expert for the plaintiffs in the case testified under oath that he did not prepare or authorize reports the lawyers submitted that showed toxic contamination at two Ecuadorian extraction sites.  The scientist, whose own name was spelled incorrectly in the allegedly fraudulent report, stated he in fact did not find significant contamination.  See his deposition for yourself (as shared by NAM’s Carter Wood) here. The WSJ Legal Blog has more on this also.  Let’s hope that the court in Ecuador, much like the authorities in Casablanca, doesn’t look the other way and let this unethical behavior slide.

Photo: Public domain