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Federal Asset Seizures On The Rise

Estate of Denial:New York businessman James Lieto was an innocent bystander in a fraud investigation last year. Federal agents seized $392,000 of his cash anyway.

An armored-car firm hired by Mr. Lieto to carry money for his check-cashing company got ensnared in the FBI probe. Agents seized about $19 million—including Mr. Lieto’s money—from vaults belonging to the armored-car firm’s parent company.

He is one among thousands of Americans in recent decades who have had a jarring introduction to the federal system of asset seizure. Some 400 federal statutes—a near-doubling, by one count, since the 1990s—empower the government to take assets from convicted criminals as well as people never charged with a crime.

Last year, forfeiture programs confiscated homes, cars, boats and cash in more than 15,000 cases. The total take topped $2.5 billion, more than doubling in five years, Justice Department statistics show.

The expansion of forfeiture powers is part of a broader growth in recent decades of the federal justice system that has seen hundreds of new criminal laws passed. Some critics have dubbed the pattern as the overcriminalization of American life. The forfeiture system has opponents across the political
spectrum, including representatives of groups such as the American Civil Liberties Union on the left and the Heritage Foundation on the right. They argue it represents a widening threat to innocent people.

Frivolous Class Action Suits May Be Coming To An End

Estate of Denial: Here’s a tip for you: Listening to really, really loud sounds over long periods of time can damage your hearing.

Perhaps you already knew that. But a few years back, a group of clever trial lawyers decided they could make some serious money by arguing in court that you are too stupid to know it yourself.

They filed 26 consumer fraud lawsuits in multiple states against Motorola and other manufacturers of Bluetooth headsets. They alleged that consumers were not warned sufficiently about the dangers, and that they “would not have purchased their Bluetooth headsets but for defendants’ false advertising.”

That led to a single class-action case in federal court, in which the plaintiffs sought refunds, restitution and punitive damages. And attorneys’ fees, of course.

The case was pretty light on the merits — in fact, Apple recently got a similar nuisance case thrown out of court over its iPod product line. But millions of people had purchased Bluetooth headsets, and so the potential for liability was high.

And these kinds of nuisance cases often cost a lot of money to defend. Most deep-pocketed defendants would rather spend a million dollars making a case like this one go away than spend millions more in litigation.

For the lawyers, this case was simple: File a lawsuit, then get a settlement agreement — which they did. Under its terms, a hearing loss charity was to get $100,000. The lawyers were to get $800,000. And those who cranked up the volume full blast until they lost their hearing? They would basically get nothing.

Useful Law School Electives

ABA Journal: Evidence is the most useful elective law school course, according to an email survey of George Washington University law school alumni.

The school asked about 13,500 alumni to list their most useful elective courses and the courses they wish they had taken, report the Volokh Conspiracy and the Wall Street Journal Law Blog. There were 576 responses to the January survey (PDF), according to a summary (PDF).

The top five most useful electives identified by alumni were:

1) Evidence (156 votes)

2) Administrative law (120 votes)

3) Corporations (105 votes)

4) Trial advocacy (71 votes)

5) Federal income tax (47 votes)

The top courses alumni wish they had taken were…

Legal Education Lacks Practical Training

Law.com:  The alarming decline in recent law school graduate placement has received much attention lately, including an instructive July 11 article in The Wall Street Journal, “Law Schools Get Practical,” noting that more than twice as many people passed the bar exam in 2010 (54,000) as there were legal job openings in the United States. Perversely, at the same time, law schools are prospering financially on the backs of their students by substantially increasing both tuition and enrollment, as The New York Times found in a July 17 article, “Law School Economics: Ka-Ching!“

The current recession is, of course, a prime reason for the diminution in available jobs. But The Wall Street Journal article also correctly focuses on another major issue — the disconnect betweencontemporary law school education and the skills needed to be an effective, and therefore employable, lawyer. Unlike other professional schools, such as medicine and business, law schools continue to teach primarily based on a 19th century theoretical model that is good at developing critical legal thinking but severely lacking in teaching practical skills. That void is particularly acute in the business and corporate area.

US Considers Plan For Mortgage Refinancing

ABA Journal: As the housing market continues to slide, the U.S. government is considering a mortgage refinancing plan and other options to help struggling homeowners.

Many homeowners have been unable to refinance because they are underwater on their mortgages or their credit rating is tainted. Specifics of the plan are unclear, but it would allow some homeowners with government-backed mortgages to refinance at today’s lower rates, the New York Times reports. The hope is that the money saved will be spent elsewhere, helping to shore up the economy.

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