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NFL Concussion Settlement: Backroom Deals and Powerplays

NFL Concussion Settlement-Brody-Seeger-Power DynamicMay 20, 2019
Sheilla Dingus

Transferee judges like Anita Brody have a tremendous amount of power in the MDLs assigned to them, so why don’t they monitor for deals that disadvantage plaintiffs? Or should that fail, why don’t attorneys who do have a vested interest in plaintiff outcomes object more vigorously?

The answer lies in a strangely balanced power dynamic that sometimes resembles a “game of thrones.”

The Problem with Judges

While in uncertified MDLs the judge isn’t required to approve a settlement between plaintiffs attorneys and defendants, in a class action, FRCP Rule 23 task the judge with a number of safeguards for the class, including proper representation of all class members, adequate notice to class members including the ability to opt out, and approval of the settlement terms as “fair, reasonable, and adequate.”

But—as Professor Burch explains:

Congress passed the Multidistrict Litigation Act in 1968. The statute authorizes a panel of seven judges selected by the Chief Justice of the U.S. Supreme Court to transfer factually related lawsuits to a single district judge for coordinated pretrial litigation.

Multidistrict litigations are plum judicial assignments; they involve interesting facts, media attention, and some of the nation’s most talented attorneys. But only around 27% of active judges and 20% of senior judges receive them. Of those chosen few, 80% wanted another one.

The best way for judges to continue to get these assignments is, unfortunately, not based on how just their decisions are, how thoroughly they are able to flesh out factual information through discovery prior to remanding the cases back to the originating courts, since this rarely occurs, or even their capability in wisely adjudicating them to trial since few cases ever make it that far.  More than any other factor, judges are evaluated by the Panel for their efficiency.  In order to keep receiving these choice assignments, judges are tasked with moving their cases forward as quickly and cost-efficiently as possible—and that usually means a settlement.  This sometimes means that even in certified class actions judges take shortcuts rendering the procedural safeguards ineffective.

It’s easy to see how Judge Brody was influenced by the quest for efficiency.  First, she was adamant that Chris Seeger, who has the reputation of a closer serve as lead plaintiffs’ counsel.  As soon as plaintiffs’ leadership appointments were made and a master complaint was filed on the plaintiff side and various motions to dismiss on the defendant side, Judge Brody refused to rule on the motions and instead ordered counsel to mediation purposed to encourage settlement.

mediation order

“Encourage” is probably a very polite word that might better be expressed as “pressure.”  It seems a majority of judges currently on the federal bench view settlements as the desired outcome of their cases.  Professor Burch cites numerous examples in her book including:

[A]n observation from Judge Jack Weinstein, “Federal judges tend to be biased toward settlement. We clean the dishes and cutlery so they can be reused for the long line of incoming customers. Settlements are the courts’ automatic washer-dryers.”

[T]he “settlement culture,” as Judge William Young dubbed it, “is nowhere more prevalent than in MDL practice.” As he notes, when The Manual for Complex Litigation touts multidistrict proceedings as “a unique opportunity for the negotiation of a global settlement” and instructs transferee judges to “make the most of this opportunity,” it “seems virtually to command this result.”

Since a few of the early CTE cases had been dismissed prior to consolidation on the basis of §301 of the Labor Management Relations Act and the existence of a collective bargaining agreement. All indications appeared that Judge Brody was using a possible—and some felt—likely dismissal as leverage to force a settlement.  With no discovery conducted (very cost efficient), and indications that she would rule in favor of the NFL, Seeger and to some extent, the other co-lead, Sol Weiss along with the executive committee hammered out a less than optimal deal.  The proposed settlement left the NFL on the hook for $765 million, and under the guise of “fair, reasonable, and adequate,” Judge Brody rejected the settlement based on concerns that the amount was inadequate to compensate players for the 65-year term agreed upon. This seemed like a win for the players when in reality, it wasn’t.

Back to the table, the attorneys went, however, and this time they came away with an uncapped deal in which plaintiffs’ counsel agreed to stringent fraud protection measures and the NFL agreed to generous common benefit fees for class counsel, separating them from the bottomless fund.  This time, Judge Brody was satisfied.

If you’re familiar with my previous reporting, then you’re aware of how the NFL has weaponized the audits and other fraud prevention provisions to steer the claims administrator and the court to the position that most dementia claims were fraudulent and clogging up the system, while Seeger for the most part, having received the lion’s share of compensation courtesy of the NFL, took a rather passive approach on player issues, often siding with the NFL or opposing them only when backed into a corner.

After the settlement was deemed “fair, reasonable, and adequate,” Notices were approved by Judge Brody and sent to the class describing it in minimal terms along with an inclusion of opt-out provisions.

Kevin Turner, who suffered from the horrific devastation of ALS was chosen as the class representative for impaired players and Shawn Wooden for currently unimpaired retirees.  Judge Brody deemed class representation to be adequate.  Unfortunately, in order to achieve class certification, which is becoming more difficult to obtain, representation was oversimplified.  Turner was an outstanding representative for those suffering from the neuromuscular degenerative diseases of ALS and Parkinson’s disease, which affect the body, rather than the mind, but lack of a representative with dementia—especially someone in the earlier stages proved costly, and this is where the NFL has drawn its battle lines, determined to mitigate its losses.

Judge Brody probably trusted Seeger’s judgment as to class representation and hasn’t given an appearance of educating herself to any great degree as to the various compensable conditions.  Without counsel insisting on additional class representation and BAP standards more in line with standard medical practice, it’s reasonable to believe that class representation and settlement terms were adequate.

So why didn’t the lawyers do something?

Well, a few tried to, but Seeger et al, crafted a narrative to portray the Objectors who had correctly evaluated the settlement as greedy lawyers and players peddling misinformation.  Though they appealed to the Third Circuit and sought certiorari at the Supreme Court, their efforts were shot down.

There Will Be Lawyers

The dominant theme running throughout Professor Burch’s book is how the top plaintiff lawyers have established themselves as repeat players encompassing nearly all product liability and personal injury mass torts, meaning for those on the fringes, opportunities depend on this small, but elite group, of which Chris Seeger is one of the most prominent figures.  This means that opposing him represents a risk of being shut out of future leadership opportunities, whereas, compliance, could be the key to more appointments.

Courts encourage cooperation, therefore, though many of the attorneys are rivals, they find it in their best interest to put differences aside and work together.

Professor Burch’s account of attorney Lance Cooper’s experiences in litigation against General Motors is instructive as to how the game is played.

Plaintiff’s attorney Lance Cooper is no stranger to products-liability cases – he litigated a Ford Bronco II rollover back in the 1990s. But he’s not among the usual suspects that judges appoint to lead multidistrict proceedings. After his investigation into Brooke Melton’s case led GM to double its car recall, however, he started getting calls from lawyers in Louisiana, Mississippi, and California – all wanting him to join their “team.” “They’re all MDL lawyers,” Cooper said, “but they know nothing about this litigation.” He eventually agreed to work with Roland Tellis of Baron & Budd and Adam Levitt of DiCello Levitt. Thereafter, Cooper quickly found himself “sucked up” in the mass-tort world. “I flew up to the Panel hearings in Illinois,” he explained, and it was “surreal.” “All these vendors were there catering to lawyers – claims administrators, document discovery folks, all up there wining and dining everyone.”

The Panel sent the proceedings to Judge Jesse Furman in New York and he appointed Steve Berman, Elizabeth Cabraser, and Mark Robinson to lead the cases temporarily. But Cooper wanted that position on a more permanent basis. “No,” his new teammates told him, “it wouldn’t be good to challenge them. This is the way the game is played and they won this round. We need to ingratiate ourselves with them so we can get on the executive committee.” So Cooper attended the meeting before the meeting. “It was all about coalitions, who’s going to get on the exec committee, who’s going to support who,” Cooper explained. “It reminded me of a scene out of an old mafia movie,” he said.

Lance Cooper did land a spot on the executive committee. But he quickly realized that Steve Berman “was going to control everything.” Still, Cooper continued to press forward with Brooke Melton’s case in state court. “I had a tremendous opportunity to proceed with aggressive discovery” in her case, he said, but “I got pushback from Berman and [co-lead Bob] Hilliard.” They wanted all the discovery to go through the multidistrict proceeding. 

The state court judge set a trial date for the Meltons, but it was delayed “because of the MDL co-leads and GM,” Cooper explained. So, the multidistrict proceeding’s discovery bottleneck waylaid the very case that helped give it life. Nor could Cooper control most depositions. “We need to take a tight trial deposition, 30 minutes, so when the jury’s watching, it’s interesting,” he said. But he felt like the leaders’ depositions were long and rambling. It was “lawyers just wanting to bill time.” The entourage that appeared for every deposition was “plaintiffs’ lawyers acting like defense lawyers,” Cooper lamented. “My clients are harmed because they’re having to pay for people to be there who don’t need to be.” “It was a disaster,” Cooper concluded, “not a single deposition that was taken in the MDL was useful for trial.” Yet, Judge Furman declared the depositions finished, so “I was hamstrung from taking any more.”

Lance Cooper resigned from the executive committee in April 2015.  E-mail exchanges between him and Bob Hilliard show increasing acrimony. “[Y]ou suggest that it is a conflict if I sit on the EC and also advocate on behalf of my clients in state court cases,” Cooper wrote.

Cooper also thought that Hilliard and Steve Berman put their own self-interest first, particularly when it came to selecting cases for bellwether trials. If bellwether trials represent the remaining cases in a proceeding, they can provide a yardstick for the proceeding’s strengths and weaknesses and help set settlement values for all the plaintiffs. So Cooper worried that a weak case would affect his clients. He told Hilliard, “We also received a phone call from one of the lawyers in the MDL who had a potential bellwether case. The lawyer told me that your partner . . . told him that the case would have a better chance of being picked as a bellwether case if he agreed to pay your law firm 50% of the attorneys’ fees.” “Although I have never been involved in an MDL before, that is just simply wrong,” Cooper wrote.

The initial bellwether trial plan was to try a strong, sympathetic case first – one where James Yingling, a young father of five, died in a single-vehicle crash. But, as Cooper’s e-mail suggested, Steve Berman and Bob Hilliard seemingly wanted a portion of the attorneys’ fee for that case. And Yingling’s family’s lawyer didn’t want to hand the reins (and half of his fees) over to them. So, they moved Yingling’s case from first to fifth and put one of Bob Hilliard’s cases first. As Hilliard explained, after Yingling’s lawyer “declined Co-Lead Counsel’s participation, . . . Co-Lead Counsel determined that it would be in the best interests of all MDL plaintiffs if Co-Lead Counsel adjusted the order of trials so that Co-Lead Counsel could try the first bellwether case.”

“Your intentions are obvious,” Yingling’s lawyer wrote to Hilliard, “You want to control this litigation and maximize the fees earned by your law firm regardless of the harm your actions may cause the MDL plaintiffs.” The case that Hilliard placed first, explained Yingling’s lawyer, involved a plaintiff with soft-tissue injuries who was out of work for only a few months, whereas “Mr. Yingling was a 35 year old father who lingered 17 days with a profound brain injury.” When he died, he “left behind a wife and five children.”  After receiving this objection, the leaders relented slightly, moving Yingling from fifth to third – but not first.

Bad bellwether trials can hurt all plaintiffs’ settlement prospects. And the bellwethers  in GM went south as soon as they began: Bob Hilliard withdrew the first suit after his soft-tissue-injury client committed perjury and fraud at trial, GM won the second, the Yingling case then settled, leaders voluntarily dismissed the fourth, and then leaders settled the last two.

After Hilliard’s client perjured himself in the first bellwether, Lance Cooper made national headlines by suggesting that the court remove Hilliard from his leadership role.  Cooper claimed that Hilliard put himself first. “If he is permitted to continue in his role as a co-lead, it will only get worse,” Cooper wrote. In addition to the bellwether issues, Cooper alleged that Hilliard “cut a secret deal with GM,” which settled 1,385 plaintiffs’ claims (all Hilliard’s cases except those slated as bellwethers) in exchange for a “high-low deal.” High-low agreements set the range for a jury’s award: if a plaintiff wins a big verdict, the arrangement would lower it to a prenegotiated amount, thereby limiting GM’s financial exposure. Conversely, if GM wins, under the deal the plaintiff would still receive a nominal “low-end” award. But the high-low deal that Hilliard divulged to the court in chambers applied not just to one case but to all the remaining bellwether trials.

“[W]hen a lead attorney negotiates a side-settlement of his firm’s inventory of cases while retaining control of an MDL,” wrote Professor Charles Silver in supporting Cooper’s motion, there’s “a clear and well-recognized potential for a serious conflict of interest.” Why? “[T]he parties who are at the bargaining table can expropriate wealth from the parties who are not, and share it between themselves.”  There needn’t be any underhanded deal or conscious collusion. It’s a structural conflict. “[T]he structure – negotiating a side-settlement while also controlling a separate aggregate proceeding,” Silver explained, “creates incentives and opportunities to help one group of people at the expense of another.” Those “opportunities cannot be policed.”

When Lance Cooper sought to remove Bob Hilliard, GM – the defendant – hired an ethics expert to defend Hilliard. Professor Geoffrey Miller argued that lawyers’ “duty to protect and advance the interests of their own clients is not limited by any obligations owed to clients of other attorneys.”

 “[W]hat struck me first,” responded Professor Silver, “was that General Motors LLC, the Defendant, retained [Miller].”  If Hilliard was doing a bang-up job, GM should want to get rid of him. “GM’s hope that he will retain control of the MDL is a bad sign,” Silver concluded.  

The NFL litigation differed from the GM litigation in that it is a class action.  In the NFL case no discovery was conducted, nor were there any bellwether trials, but it certainly was not without its own share of disputes and powerplays, most of which took place quietly behind closed doors.  One, however, played out publicly.

In January 2014, Mark Fainaru-Wada of ESPN reported, that an attorney who was part of the negotiating committee wasn’t sold on the settlement’s benefits as publicly portrayed. “Thomas V. Girardi said the settlement benefits severely impaired former players but leaves many others with barely “a handshake.” He said he was trying to determine which players to ‘opt out’ of the deal and continue litigation against the league.”  As I wrote in April 2018, I’m in possession of an audio recording made shortly after the ESPN article broke in which Seeger refers to Girardi as a “big mouth” and admits to kicking him off the negotiating committee, stating, “he can’t keep his mouth shut…I put him in the dark, I did, because he was dangerous to the deal.”

Later, in November 2014 Patrick Hruby wrote for Vice Sports, “Times change. In late September, Girardi’s firm sent its former player clients a mass email that subsequently was shared with VICE Sports. The letter, signed by Girardi, advised every former player—in bold, underlined type—to accept the settlement. No exceptions. No individual evaluations. Nothing like the medical due diligence Girardi previously promised…Just a simple take the deal.”

Most attorneys who had been appointed to leadership positions in the NFL litigation found themselves marginalized, with very few privy to the actual negotiations.  Instead, the majority of steering committee members were directed to public relations roles to garner support for a settlement most didn’t truly understand.  In a declaration to the court, attorney Mike McGlamry stated, “Mr. Seeger has failed to hold or participate in substantive discussions with MDL-2323’s PSC and PEC since 2013.  There have been no leadership meetings, no leadership conference calls, and literally no leadership discussion.  Mr. Seeger effectively became a solitary dictator over MDL-2323.”

Conversations with some attorneys who were involved early in the concussion MDL indicate that Seeger lashed out at anyone who questioned his bargaining, at times even threatening to destroy careers if someone stood in the way of his “deal.” In view of this, it’s easy to see why Girardi caved to the pressure.  The late Charles Zimmerman, though he was not in the elite top tier which Seeger, Berman, Hilliard, and about three other attorneys occupy was no stranger to MDL—in fact, he was part of the leadership structure in the Propulsid litigation that propelled Seeger’s career.

After the settlement entered the implementation stage and it became apparent that players suffering from dementia had been given short shrift, Zimmerman told me that he’d always considered Seeger to be a friend, “but what he was doing here, is just plain wrong.”  Zimmerman apparently learned from his experiences in the NFL litigation.  He was one of the lead attorneys in the concussion litigation against the NHL, which unlike the NFL case obtained substantial damaging discovery, but failed to certify as a class action.

Without the critical mass of players who filed lawsuits, as had been the case in the NFL litigation, and without class certification, he and the other attorneys leading the NHL MDL in Minnesota were left with few bargaining chips.  The settlement they entered into was less than ideal, but did at least guarantee modest payouts to all players who opted in.  Although many of the defendant-friendly provisions engineered in Propulsid were a part of the NHL settlement, Zimmerman and the other attorneys did manage to secure one very important plaintiff-friendly inclusion, and that was that no unused money would revert to the NHL.  This means that once the NHL deposits the agreed upon funds, they have little interest in how the money is spent, which indicates that the hockey league will not be fighting claims in that settlement as the National Football League has.  In fact, in the NHL settlement, only plaintiffs’ leadership and the claims administrator will make a determination of players’ awards. Their challenge, because of the limited funds will be deciding how to distribute it equitably.

Why did Tom Girardi do a complete 180° and tell all of his players to accept the settlement after previously voicing numerous concerns and stating that he was going to evaluate on a player to player basis?

In addition to the politics, alignments, and powerplays described above, Propulsid engineered many defendant-friendly provisions that restrict lawyers who participate in the settlements, which, contrary to popular belief, are not between plaintiffs and defendants as with individual cases, but rather plaintiffs’ attorneys and the defendants.  These provisions often obligate the attorneys to hedge their responsibilities to individual clients creating a grave conflict of interest.

Read on to learn more about how these provisions, help everyone except the injured parties the settlements were supposed to compensate.

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Immense gratitude to Professor Elizabeth Chamblee Burch for the incredible research presented in Mass Tort Deals: Backroom Bargaining in Multidistrict Litigation.  It is through studying what has become routine behavior in mass torts that pervasive problems can be identified and hopefully corrected.  Note, all quotes and citations not otherwise attributed are from this book.

Editor at Advocacy for Fairness in Sports | Website

Sheilla Dingus founded Advocacy for Fairness in Sports in October 2016, after a stint with Defenders of the Wall, a New England Patriots based blog where she dived deep into the legal aspects of Deflategate. Along the way, she observed many inequities in sports and felt a need to address some of the under-reported stories in sports law. She draws from her background as a former professional dancer, who like many of the athletes she writes about, took an early retirement due to orthopedic injuries. After a return trip to college she worked for a legal software company, with seven years as a Project Manager and Analyst. She brings her analytical skills to the table in breaking down complex lawsuits, and enjoys pursuing her longtime interest in journalism.

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