What John Edwards tells us about the legal profession

Imagine if four CEOs of America’s  biggest companies—for the sake of argument say Steve Ballmer of Microsoft, Mike  Duke of Walmart, Jeff Immelt of General Electric, and Rex Tillerson of Exxon-Mobil—were all charged  with serious crimes, with three of them actually going to prison. Imagine the media  handwringing and teeth-gnashing over the ethical state of corporate America such  scandals would inspire, as well as the rush by business schools to upgrade business  ethics courses.

Of course, not a one of these four  gentlemen is on trial. All four are widely admired as business  leaders.

But there is, in fact, one business  sector that earns more than $40  billion a year, with revenues 50 percent greater  than those of  Microsoft or Intel, with just such a scandal. Four leaders of  this  sector have been charged with serious crimes, one of them utterly   disgraced, three others going to prison. And this has happened without  media  wrap-ups and broad, widespread re-examination of the ethics of  their  profession.

I am talking, of course, about the  trial bar.

[See a slide show of the members of the Supreme Court.]

Exhibit A is John Edwards.

Of course, a North Carolina jury declared a mistrial over the verdict on the  former senator and presidential candidate,  acquitting him on one count  and deadlocking over five others. But Edwards did  insert himself into  presidential politics, making an uxorious show of fawning  over his  wife, all the while knowing that his life and campaign were a time   bomb. In short, he was unmasked as a man who grotesquely jettisoned any   concern for the public. While most Americans know him as a politician,  Edwards  was once one of the nation’s foremost trial lawyers, famed as a  seducer of  juries.

So, too, was Richard “Dickie” Scruggs—long  styled the “King of  Torts”—who was convicted in 2008 for attempting to bribe a  judge with  $50,000. The judge who sentenced him to five years in prison, after   listening to secretly recorded conversations, said, “It made me think  perhaps  this was not the first time you did this because you did it so  easily. And  there is evidence before the court that you have done it  before.”

Mel Weiss, who was once recognized as  the “King of the Plaintiffs’ Securities Bar,” was sentenced in 2008 to 2 1/2 years in prison for  illegally paying clients to file shareholder  suits.

[Edwards Case Shows How Complex Campaign Finance Law Can Be.]

Then there is Bill Lerach, whose  name was synonymous with  class-action investor litigation, who went to prison  after pleading  guilty in 2007 to a $251 million client-kickback scheme.

These high-profile cases reveal a very  public breakdown in the ethics of a profession. Why is this happening?

One reason is an administrative rule change  in class-action lawsuits.  Before this change, you had to affirmatively seek to  join a  class-action lawsuit. In recent decades, such suits have been “opt out,”   meaning that you can be enlisted into a lawsuit as plaintiff without  your  knowledge, and even against your will. Lawyers can now dragoon  armies of  plaintiffs to intimidate defendants into settling meritless  cases.

[Read: What Everyone Can Learn from John Edwards]

Cultural change is also to blame. Many  law school students graduate  with the belief that our adversarial system gives  them license to win  at all costs. Congress and state legislatures—populated by  lawyers—are  ever busy creating new causes of action. Lawsuits driven by contingency   fees, with limitless potential to win punitive damages, have turned  lawsuits into  arbitrage. In fact, thriving investment firms now invest  in lawsuit shares as  if they were futures.

It wasn’t always so.

Up until the mid-20th century, American lawyers did not see  themselves as pure engines of profit.  They saw themselves as officers  of the court who might flex sharp elbows, but  wouldn’t stoop to win.  Most of all, they saw themselves as the gatekeepers of  the law.

[See a collection of political cartoons on the 2012 campaign.]

“Discourage litigation,”  said one Illinois lawyer named Abraham  Lincoln. “Persuade your neighbors to  compromise whenever you can. Point  out to them how the nominal winner is often  a real loser— in fees,  expenses, and waste of time. As a peacemaker the lawyer has a superior  opportunity  of being a good man. There will still be business enough.”

What would Lincoln have made of class-action  lawyers today who engage  in lawsuit arbitrage, or those who troll local  restaurants looking for  easement issues under the Americans with Disabilities Act to extract easy  payments from  mom-and-pop operations?

“Never stir up litigation,” Lincoln said. “A worse man  can scarcely  be found than one who does this. Who can be more nearly a fiend  than he  who habitually overhauls the register of deeds in search of defects in   titles, whereon to stir up strife, and put money in his pocket? A moral  tone  ought to be infused into the profession which should drive such  men out of it.”

This is, perhaps, the true indictment  of the profession today. What  will it take for the media and the law schools to  pay attention?

Attribution:

What John Edwards Tells Us About the Legal Profession
Mark W. Davis
June 1, 2012
U.S. News & World Report
http://www.usnews.com/opinion/blogs/mark-davis/2012/06/01/what-john-edwards-tells-us-about-the-legal-profession