Symposium on Novel Liability Theories and the Incentives Driving Them

The court system is often used as a testing ground for novel theories of liability. Some believe this is a valuable feature of the civil justice system, while others see it as a bug. This Symposium examined whether the potential gains of choosing courts as an avenue for accomplishing public policy goals drive this type of litigation and whether the incentives to pursue such novel litigation claims are directly proportional to the judicial system’s receptivity to creativity.

For example, from opioids to climate change to lead paint to the COVID-19 business re-openings and beyond, governments and private plaintiffs are increasingly turning to the common law doctrine of public nuisance to address widespread public policy issues. Long viewed as a relatively unimportant element of the common law, courts have in recent years expanded the scope of public nuisance far beyond its long-established contours. Suddenly, some defendants are seeing themselves at risk of liability from past actions that were long considered both legal and beneficial, raising questions about the rule of law, due process, and fairness generally. Furthermore, as the courts accept public nuisance, consumer fraud, or other theories as bases for expanding litigation, questions arise over the proper role of the courts vis-à-vis the legislative and executive branches that have traditionally been charged with resolving complex regulatory issues in the spaces into which courts are now stepping.

The Symposium also examined the proper function and role of municipalities, counties, and other public entities within our system of government. Some of the novelist of novel lawsuits in recent years have sprung from lawsuits with public entities as plaintiffs. Panels explored whether these public entities are equipped to appreciate the unintended consequences of their decisions to litigate, especially if municipalities or counties bring lawsuits without consultation with or approval from their state governments. Other areas to be explored included the incentives for cash-strapped entities to bring litigation as a means of generating revenue; the role that plaintiffs attorneys play in encouraging public entities to sue; retention agreements between public entities and private attorneys working on contingency representing the public entities instead of government lawyers; and more.

Finally, the Symposium had another category of panels discussing the unique problems associated with government settlements. How often are public entity lawsuits brought as leverage to induce settlements from market participants? How are settlement funds managed? Who can access and profit from them? How are lawyers to be paid and what effect does that have on the plaintiffs bar offering their services to state attorneys general and municipality counsel? In addition to these and other questions, speakers also discussed the particular dangers that arise when governments take (actually or de facto) substantial stakes in ownership or management of companies as a term or consequence of settlement. How do such arrangements square with the appropriate role of government and free enterprise?

Please see below for recordings of the event: