Chief Justice Roberts

If you’ve thought about filing a business lawsuit in federal court or you have one underway already, you’ll probably want to read about two still-in-process studies by Columbia University and Harvard University law school professors on how the U.S. Supreme Court under Chief Justice John Roberts (2005-present) has treated business lawsuits, and how that treatment has resulted in a more arduous, expensive process for businesses.

On April 4, draft papers on the topic by Columbia’s Scott Hemphill and Harvard’s John Coates were subjected to scrutiny at the Institute for Law and Economic Policy’s 20th annual conference. On the panel, Duke’s Jim Cox stood in for Coates, who had a conflict. Also on the panel were Robert Jackson Jr. of Columbia, law professor Barak Orbach of University of Arizona and Lawrence Norden of NYU’s Brennan Center. Blawgletter rounded out the group.

The Roberts Court on Antitrust

Hemphill’s work focused on antitrust cases, and his outline highlighted the largely pro-defendant record of the Roberts Court in this arena. It recounted the four wins versus 10 losses by plaintiffs, but noted that the victories all came after 2009. Hemphill said that the rulings reflect skepticism about class actions (Twombly and Comcast) as well as the ongoing influence of economic theory on the substantive scope of liability (Weyerhaeuser, Leegin and Actavis). He pointed to the latest ruling, in Actavis, as cabining “patent triumphalism” in antitrust.

Orbach said decisions from the Roberts Court have lacked any meaningful analysis. Of the 14 antitrust cases it’s ruled on, eight were on substantive matters and six on procedural issues. “The most obvious pattern in these decisions is hostility to private enforcement,” he said.

Orbach pointed out that in his confirmation hearing in September 2005, Chief Justice Roberts emphasized the value of private antitrust enforcement. Specifically, he stated, “I do think that the system established under the Sherman Act of private antitrust enforcement—and of course the opportunity to recover additional damages and attorneys’ fees and other aspects—has been an effective tool in enforcing the law.” Thus far, Orbach noted, the Roberts Court has been very consistent in dismantling this antitrust tool.

The scholars on the panel repeatedly circled back to one overriding concern: the Roberts Court lacks any business litigators, and thus is making uninformed decisions in these cases.

“I am equally troubled by the credit the Court receives for its use of economic lingo, suggesting it endorses economic principles,” Orbach continued. “I simply don’t see any meaningful analysis in antitrust decisions. The lingo is used to justify very simple decisions, but the decisions are not necessarily coherent.”

The Roberts Court on Securities Fraud

Criticism of the Roberts Court’s handling of business cases continued as the panel moved to cases involving securities fraud, which was the focus of Coates’s work. His paper aimed at grading the Roberts Court by tallying securities fraud cases that it deemed “expansive” versus those it assessed as “restrictive.” It concluded that the Court has not gone very far either way. It also attributed what it perceived as the Court’s gradualism to Roberts’s background as an appellate lawyer, rather than a transactional one who would tend to prefer bright-line rules.

The NYU Brennan Center’s Norden spoke about Citizens United, which struck down limits on corporate funding of PACs, and the brand-new McCutcheon ruling, which lifted the cap on total contributions to all federal candidates. Like Orbach, Norden believes the Roberts Court has been labeled “pro-business” inaccurately: “. . . [W]hat Professor Coates’ work and methodology require us to do is look past the Court’s rhetoric and image to what is actually happening in the cases—and what is interesting to see is that even in the high-profile lottery cases, the Court demonstrates a similar lack of understanding about how business and corporations work.”

While the members of the Court may have pro-business instincts, Norden said, “they don’t have a deep substantive understanding of how businesses work.”

Columbia’s Jackson agreed, stressing that the Roberts Court lacks any business lawyers, and therefore they don’t really understand what businesses want from the Court and often make mistakes that actually make the law tougher on those they’d like to help. So, while the Court may want to be pro-business, it is decidedly not.

The Cost of Business Litigation

As a member of the panel, Blawgletter focused my assessment on the Court’s strong tendency to make business litigation more costly. We cited Chief Justice John Marshall’s dictum that “the power to tax includes the power to destroy.” The tendency continues a trend that started in the 1980s with Celotex (on summary judgment) and continued in the 1990s with Daubert (expert opinion evidence), the 2000s with Twombly and Iqbal (pleading a claim), and the 2010s with Dukes, Comcast, and the 2014 Halliburton decision (class certification).

Each layer of procedure tightens the filter, presumably in the hope that it will catch and eliminate any “false-positive” results (cases that plaintiffs win but, in a metaphysically objective way, should lose). But it has the effect of multiplying the number of false-negative results (cases that plaintiffs should win but don’t, either because the filter is substantively too demanding or makes pursuing the claim too costly).

The obsession with false positives and use of procedure to banish them has perverse results. The Court’s majority often cites the great expense of business litigation, but in truth the growth in cost has largely resulted from the vast increase over the last three decades in the number and complexity of procedural devices that defendants may deploy to postpone or avoid a judgment on the merits.

Class certification, for instance, no longer occurs (if at all) early in a case. Instead it takes place (again, if at all) almost simultaneously with summary judgment motion practice shortly before trial. Tightening the filter increases the cost, higher costs justify another tightening of the filter, that raises costs further . . . and the cycle continues. We have a system that ferrets out almost every false positive, promotes false negatives, and is so expensive that only the wealthy can afford it. No wonder people try cases so seldom these days.

We ended by pointing to a June 2013 story by New York Times Supreme Court reporter Adam Liptak. He noted that “[t]he price of victory today for liberals . . . can be pain tomorrow.”

He had in mind a 2007 precursor to 2010’s Citizens United, a modest ruling in which Roberts laid the rhetorical groundwork for the vastly more far-reaching decision in the sequel. But he could as well have meant what happened to Twombly, the 2007 case that Justice David Souter authored. Two years later, in 2009, Justice Souter found himself dissenting, in Iqbal, which took Twombly to a new level. He said in dissent that “there is no principled basis” for the majority’s application of Twombly. Thus seeds grow into poisonous bushes.

What We’ve Learned

In 1955, a British journalist wrote an essay on bureaucracy for The Economist magazine. The correspondent, Cyril Parkinson, put in the first sentence what we now know as Parkinson’s Law. It posits, roughly, that work expands to fill the time available to do it.

What held for bureaucrats in 1955 holds for lawsuits today.

In 2014, you rarely see a commercial case that gets to trial until the number of docket entries climbs above 400. You find motions to dismiss under Twombly and Iqbal, to compel arbitration under Stolt-Nielsen and Italian Colors, to enforce a forum-selection clause under Atlantic Marine Construction, for summary judgment under Celotex, to strike expert reports under Daubert, to decertify a class under Dukes and to review class certification under Rule 23(f).

The same impulse that prompts lawyers to use every available procedural device also persuades them to include a multitude of grounds. Thus a motion to dismiss asserts not only that the statute of limitations has run but also that laches, equitable estoppel and waiver bar the claim. A Daubert motion attacks not just the expert’s credentials, her methodology, the reliability of the data she used, the timeliness of her report and the possibility of gaps in her reasoning; it also recounts every time a judge has said something uncomplimentary about her work.

These efforts cost a bundle—for the clients. Not all of them have the same likelihood of success, but who will demand restraint? Using all of them wastes the time—and tests the patience—of judges, whose goodwill and trust you will need sooner than you think, but how often do lawyers cite that as a consideration when advising clients about strategy?

By increasing the size of the copious supply of defensive procedural weapons, the Roberts Court has created many new ways to expend resources—money, credibility, reputation. But lawyers should select the one, two or at most three devices whose skillful deployment will give their clients the best chance of winning. That requires restraint. We need a lot more of it.

This article first appeared in the July 8, 2014 issue of Corporate Counsel.
Read more: http://www.corpcounsel.com/id=1202662054054/What-Businesses-Need-to-Know-About-the-Roberts-Court#ixzz36t70yRVp

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Photo of Barry Barnett Barry Barnett

Clients and colleagues call Barry Barnett an “incredibly gifted lawyer” (Chambers and Partners) who is “magic in the courtroom” (Who’s Who Legal), “the top antitrust lawyer in Texas” (Chambers and Partners), and “a person of unquestioned integrity” (David J. Beck, founder of Beck…

Clients and colleagues call Barry Barnett an “incredibly gifted lawyer” (Chambers and Partners) who is “magic in the courtroom” (Who’s Who Legal), “the top antitrust lawyer in Texas” (Chambers and Partners), and “a person of unquestioned integrity” (David J. Beck, founder of Beck Redden).

Barnett is a Fellow in the American College of Trial Lawyers, and Lawdragon has named him one of the top 500 lawyers in the United States three years in a row. Best Lawyers in America has honored him as “Lawyer of the Year” for Bet-the-Company Litigation (2019 and 2017) and Patent Litigation (2020) in Houston. Based in Texas and New York, Barnett has tried complex business disputes across the United States.

TRIAL COUNSEL
Barnett’s background, training, and experience make him indispensable to his clients. The small-town son of a Texas roughneck and grandson of a Texas sharecropper, Barnett “developed an unusual common sense about people, their motivations, and their dilemmas,” according to former client Michael Lewis.

Barnett has been historically recognized for his effectiveness and judgment. His peers chose him, for example, to the American College of Trial Lawyers and American Law Institute. His decades of trial and appellate work representing both plaintiffs and defendants have made him a master strategist and nimble tactician in complex disputes.

Barnett focuses on enforcement of antitrust laws, the “Magna Carta of free enterprise,” in Supreme Court Justice Thurgood Marshall’s memorable phrase. “Barry is one of the nation’s outstanding antitrust lawyers,” according to Joseph Goldberg, a member of the Private Antitrust Enforcement Hall of Fame. Named among Texas’s top ten antitrust lawyers of 2023, Business Today calls Barnett a “trailblazer” among the “distinguished legal minds” who “dedicate their skill and expertise to the maintenance of healthy competition in various sectors” of the Lone Star State’s booming economy. Barnett is also adept in energy and intellectual property matters and has battled for clients against a Who’s Who list of corporate behemoths, including Abbott Labs, Alcoa, Apple, AT&T, BlackBerry, Broadcom, Comcast, Dow, JPMorgan Chase, Samsung, and Visa.

Barnett commands a courtroom with calm and credibility and “is the perfect lawyer for bet the company litigation,” said Scott Regan, General Counsel of former client Whiting Petroleum. His performance before the Supreme Court in Comcast Corp. v. Behrend prompted the Court to withdraw the question on which it had granted review. The judge in a trial involving mobile phone technology called Barnett “one of the best” and that his opening statement the finest he had ever seen. Another trial judge told Barnett minutes after a jury returned a favorable verdict against the county’s biggest employer that he was one of the two best trial lawyers he’d ever come across—adding that the other one was dead.

COMPLETE PACKAGE
A versatile trial lawyer, Barnett knows how to handle a case all the way from strategic pre-suit planning to affirmance on appeal. He’s tried cases to verdict and then briefed and argued them when they went before appellate courts, including the Second, Third, Fifth, and Tenth Circuits, the Supreme Court of Louisiana, and (in the case of Comcast Corp. v. Behrend) the Supreme Court of the United States.

Barnett is a sought-after public speaker, often serving on panels and talking about topics like the trials of antitrust class actions and techniques for streamlining complex litigation. He also comments on trends in commercial litigation and the implications of major rulings for outlets such as NPR, Reuters, Law360, Corporate Counsel, and The Dallas Morning News. He’s even appeared in a Frontline program about underfunding of state pensions, authored chapters on “Fee Arrangements” and “Techniques for Expediting and Streamlining Litigation” (the latter with Steve Susman) in the ABA’s definitive treatise on Business and Commercial Litigation in Federal Courts, 5th, and commented on How Antitrust Enforcers Might Think Like Plaintiffs’ Lawyers.

HARD GRADERS
Clients and other hard graders have praised Barnett for his courtroom skills and legal acumen.

A client in a $100 million oil and gas case, which Barnett’s team won at trial and held on appeal, said Barnett and his team “presented a rare combination of strong legal intellect, common sense about right and wrong, and credibility in the courtroom.” David McCombs at Haynes and Boone said Barnett “has a natural presence that goes over well with juries and judges.”

Even former adversaries give Barnett high marks. Lead opposing counsel in a decade-long antitrust slugfest said “Barry is a highly skilled advocate. He understands what really matters in telling a narrative and does so in a very compelling manner.”

CIVIC ENGAGEMENT
Barnett relishes opportunities to collaborate with all kinds of people. At the Center for American and International Law (CAIL), founded by a former prosecutor at Nuremberg in 1947 and headquartered in the Dallas area, he has served on the Executive Committee, co-chaired the committee that produced CAIL’s first-ever strategic plan, supported CAIL’s Institute for Law Enforcement Administration and other development efforts, and proposed formation of a new Institute for Social Justice Law. CAIL’s former President David Beck said “Barry is extremely bright” and is “very well prepared in every lawsuit or professional task he undertakes.”

Barnett is also a Trustee of the New-York Historical Society, a Sterling Fellow at Yale, a member of the Yale University Art Gallery’s Governing Board, a winner of the Class Award for his work on behalf of his college class, and a proud contributor to the Yellow Ribbon Program at Harvard Law. Barnett’s pro bono work includes leading the trial team representing people who are at greatest risk of severe illness and death as a result of being exposed to the novel coronavirus SARS-CoV-2 while being detained in the Dallas County jail—work for which he received the NGAN Legal Advocacy Fund RBG Award.

At Susman Godfrey, Barnett has served on the firm’s Executive Committee, Employment Committee, and ad hoc committees on partner compensation, succession of leadership, and revision of the firm’s partnership agreement. He also twice chaired the Practice Development Committee.

KEEPING PERSPECTIVE
Barnett understands that clients face many pressures. Managing the stress is important, especially in matters that take years to resolve. He encourages clients to call him whenever they have a question or concern and to keep the inevitable ups and downs in perspective. He wants them to know that he will do his level best to help them achieve their goals. He also strives to foster trust and to make working with him a pleasure.

Cyrus “Skip” Marter, the General Counsel of Bonanza Creek in Denver and a former Susman Godfrey partner and client, said Barnett is “excellent about communicating with clients in a full and honest manner” and can “negotiate for his clients from a position of strength, because he is not afraid to take a case through a full trial on the merits.” Stacey Doré, the President of Hunt Utility Services and a former client, said that Barnett is “an excellent trial lawyer and the person you want to hire for your bet-the-company cases. He is client focused, responsive, and uniquely savvy about trial and settlement strategy.” A New York colleague said, “Barry is a joy to work with as co-counsel. He tackles complex procedural and factual hurdles capably, efficiently, and without drama.”

PERSONAL
Barnett’s wide-ranging experience and calm, down-to-earth approach enable him to connect with clients, judges, jurors, witnesses, and even opposing counsel. He grew up in Nacogdoches, Texas. He co-captained his high school varsity football team as an All-East Texas middle linebacker while also serving as the Editor of Key Club’s Texas-Oklahoma District, won the Best Typist award, took the History Team to glory, and sang in the East Texas All Region Choir. As Dan Kelly of client Vistra Corp. put it, Barnett is “a great person to be around.”

Barnett is steady and loyal. He has practiced at Susman Godfrey his entire career. He and his wife Nancy live in Dallas and enjoy spending time in Houston and New York. Their daughter works for H-E-B in Houston, and their son is a Haynes and Boone transactions lawyer in Dallas.

As a member of Ivy League championship football teams in his junior and senior years at Yale and a parent of two Yalies, Barnett has no trouble choosing sides for “The Game” in November. And he knows how important fighting all the way to the end is. On his last play from scrimmage, in the waning minutes of The Game on Nov. 22, 1980, he recovered a Crimson fumble.

Yale won, 14-0.