Welcome to Critical Mass, Law.com's new briefing on class actions and mass torts. I'm Amanda Bronstad in Los Angeles. The U.S. Supreme Court punted on taking up standing in data breach cases, so I asked lawyers what comes next. Also, on the eve of trial, plaintiffs lawyers dropped a talc case against Johnson & Johnson. And insurance lawyers are watching a California Supreme Court opioid case dealing with coverage duties.

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SCOTUS Sits Out Standing Debate

The thicket of case law over standing in data breach cases won't get cleared up anytime soon — at least not by the U.S. Supreme Court.

The high court on Feb. 20 rejected a cert petition in CareFirst v. Chantal Attias that many observers had hoped would clarify when data breach victims have standing to sue in federal courts.

So why didn't the Supreme Court grant cert? Patricia “Trish” Carreiro of Axinn, Veltrop & Harkrider had some theories: She said the court could have reasoned the circuit split was based on factual, not legal, differences — or maybe CareFirst just wasn't the right case. Or there's this: The Supreme Court just denied a petition to review a similar standing issue in Robins v. Spokeo.

“The Supreme Court may be saying, 'We've taken up the injury-in-fact of standing in multiple cases, and we do have to address something else,'” she said.

So what does that mean for data breach lawyers?

Plaintiffs will have a much easier time suing over data breaches in Washington D.C., where the U.S. Court of Appeals for the District of Columbia found in October that the victims of CareFirst's 2014 cyber-attack had standing (see my coverage here). That's according to Sullivan & Cromwell's Nicole Friedlander, who told me:

“The decision means plaintiffs are going to have an easier time in the DC Circuit, but potentially elsewhere, establishing standing, which has been one of the most significant issues in data breach class actions and the most significant hurdle that plaintiffs have had to try to clear. Certainly plaintiffs, even outside the DC Circuit, will raise this decision and ask other federal courts to consider it as they make decisions in their own circuits.”

Bailing Out of Baby Powder Trial

Plaintiff's lawyers in a case alleging a woman got mesothelioma from her use of Johnson & Johnson's baby powder voluntarily dismissed their claims one month before trial. Here's my story.

The case, in Seattle, involved more than 60 defendants when it was filed in 2016. Johnson & Johnson won a similar case in California last November (see here) and is in trial right now in New Jersey in another case (see here). In Seattle, it was set to go to trial on March 12.

Plaintiff's firm The Lanier Law Firm didn't give its reasons for dismissing the claims.

But here are some possible clues: At a summary judgment hearing this month, the judge had some questions about the plaintiff's scientific evidence – in particular, an expert whose report was based on 32 cans of baby powder purchased on eBay. Of note: That expert was in the earlier California case and in the New Jersey trial.

But the judge also had statute of limitations concerns.

No doubt it's a big win for Orrick, which represented Johnson & Johnson.

Will California Curtail Opioid Makers' Coverage?

The California Supreme Court has agreed to take up an case in which an appeals court ruled that an insurer didn't have to pay to defend an opioid manufacturer. Here's Law.com's story by Ross Todd. Back in November, an appeals court found that Travelers didn't have a duty to defend or indemnify Watson Pharmaceuticals in lawsuits brought by two California counties and the city of Chicago (see Law.com's coverage here). The court held that marketing of opioids wasn't a single occurrence.

I checked in with Michael Velladao, co-chairman of the insurance coverage practice at Lewis Brisbois, to find out what impact, if any, the California Supreme Court's decision could have on the opioid litigation. He said the case won't be law outside of California — but that might not matter in settlement talks.

“If I'm from a carrier's standpoint, and I'm in an MDL, or a policy holder, I'm going to point to the fact the California Supreme Court has accepted review as significant,” he said. “If you're in a settlement conference, you can point to Travelers and say, 'it's not covered.'”

There might be a long wait for the California Supreme Court's decision. The court deferred briefing until it decides a separate case, called Liberty Surplus Insurance v. Ledesma and Meyer Construction. That case is set to be argued on March 6.

 

Who Got the Work?

Amtrak has turned to Lane Powell to defend against lawsuits brought over a Dec. 18 derailment near Tacoma, Washington, that killed three and injured dozens. The firm's team appeared last month in cases brought by an injured passenger and conductor. Seattle shareholder Tim Wackerbarth, who has represented Amtrak, BNSF and Union Pacific and is a member of the National Association of Railroad Trial Counsel's executive committee, leads the team, which also includes Seattle shareholders Andrew Yates and Warren Babb and associate Rachel Greenlee.

Here's what else you need to know:

Air Bag Funds Inflate: Takata, the auto parts manufacturer now under bankruptcy protection, reached a $650 million settlement to resolve cases brought by attorneys general in 44 states over safety defects in its air bags. Here's Law.com's story. The states have agreed not to accept the money, however. They're putting the funds into accounts for those suing Takata in court. Air bag claimants have had trouble getting compensation from Takata, whose U.S. unit had its Chapter 11 reorganization plan approved on Feb. 21. A deal earlier this month in bankruptcy court with plaintiffs attorneys provided a potential $130 million fund (see my story here), but a special master in Michigan has pegged total claims at close to $1.5 billion.

From Finance to Litigation: The lawyers who sold Gerchen Keller Capitalto Burford Capital for $160 million have launched their own litigation shop — and they say it's going to focus on class actions and multidistrict litigation. Here's Law.com's story. Adam Gerchen, Ashley Keller and Travis Lenknerhave launched Keller Lenkner, a “plaintiff-side litigation firm in Chicago that works exclusively under alternative fee agreements.” Lenkner said the type of cases would be “well-suited for litigation funding in some instances,” but the firm will have no special ties to litigation finance.

A Singular Smoker Verdict: Florida lawyers Alex Alvarez and Gary Paige got a $41.8 million tobacco verdict this month, Law.com reported. Plaintiff Dawn Schlefstein, a New Yorker, started smoking when she was 14 and was going through a pack a day before being diagnosed with emphysema. The jury awarded $27.8 million in punitive damages and $14 million in compensatory damages.

But here's where it gets interesting–R.J. Reynolds (repped by King & Spalding) didn't argue the usual defense that the plaintiff bore some blame for her smoking habit — so there was no reduction of damages because of comparative fault.