10 September 2008

Big Verdicts

Some recent big verdicts in the courts bear note.

1. A judgment against Pricewaterhousecoopers, LLC in favor of the receiver of a defunct insurance company for audit malpractice prior to its unanticpated collapse in the amount of $182.9 million, was affirmed on appeal.

2. Class action plaintiffs suing Enron in connection with its collapse which caused $40 billion in losses, secured $7.2 billion in recovery, with the lawyers netting 9.5% of the recovery.

3. The United States lost a $1.1 billion case brought by oil companies based upon breach of contract in the Federal Court of Claims in connection with leases to conduct offshore drilling of the California coast. The won a recission award when the leases were terminated by a federal law enacted after the leases were inked.

Apparently, the government entered into 35 such leases between 1979 and 1984. The oil companies then discovered oil fields that the government estimates contained over one billion barrels of oil. However, 1990 amendments to the 1972 Coastal Zone Management Act statutorily barred the oil companies from drilling in the region. The $1.1 billion, which BLT reports is one of the largest awarded in the 150-year history of the Federal Circuit, represents the amount paid under the leases.

While it is possible to bring a big money personal injury case, and there are rare big money class action personal injury or property damage tort cases, the real big dollar cases involve investments and contracts gone bad.

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