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Law Prof Characterizes Yahoo Suit as Extortion 90

Posted by Zonk from the one-person's-opinion dept.
netbuzz writes "Fair comment or libel? A law prof/blogger calls those behind the class-action suit against Yahoo 'extortionists.' The targeted lawyers, who include spyware/adware expert Ben Edelman, are not amused." From the article: "Goldman, who according to his blog 'holds leadership positions in the American Bar Association and the Computer Law Association,' addresses the merits of the suit in a generally academic fashion before winding up for the big finish: 'I think these lawsuits are nothing more than a shakedown for cash,' he concludes. 'Even unmeritorious class action lawsuits are expensive to defend, so the plaintiffs' lawyers can exploit those defense costs for their personal largesse. They can make this argument to defendants: settle with me for a fraction of your total expected defense costs, and we're both better off (defendants save some defense costs, plaintiffs' lawyers grab some personal loot).'"
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Law Prof Characterizes Yahoo Suit as Extortion More

Law Prof Characterizes Yahoo Suit as Extortion

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  • I'm sure the various Bar Associations will backdate his disbarment.
    • It certainly wasn't meant to be funny.
    • Rule 8.4 of the ABA Model Rules of Professional Conduct state that in order to maintain the integrity of of the legal profession, it is considered professional misconduct for a lawyer to engage in conduct that is prejudicial to the administration of justice or engage in conduct involving dishonesty, fraud, deceit or misrepresentation.

      Furthermore, if this professor truely believes that this is extortion, he needs to report the lawyers to the appropriate legal authorities. Rule 8.3 states that a lawyer who k

  • Yahoo! is run by yahoos? (Score:4, Informative)

    by fragmentate ( 908035 ) * <jdspilled AT gmail DOT com> on Friday May 12, 2006 @01:37PM (#15319334) Journal
    I don't think of Yahoo! as a technology company having worked with their "development team". They're a second-rate hack, at best. We have submitted YSS feeds [slashdot.org] to them and had them rejected with various problems. We would then wait 2 hours, and resubmit the feed, unchanged...

    The feed is then accepted.

    We also manage keyword buys. We'll submit a list of keywords, for example, "baby jump suits" -- to have it rejected (without notifying us -- we have to discover it after-the-fact). The word that actually goes in is "baby jump suit". The next time we submit, "baby jump suits" goes in... Clearly subjective, depending on which hack approved the submission.

    One can deduce that their approval process is manual. That means they probably have a bunch of $10/hr. hacks doing the grunt work. It's inconsistant.

    I digress...

    My point is that if you have people instead of systems, algorithms, and/or applications to do the tedious work, you have:

    • Human error.
    • Human cheating.
    • Disinterest.

    I don't think Yahoo! the corporate entity is aware of these goings-on. But given the clear inconsistancies that make Yahoo! difficult to work with, I think they're accountable nonetheless.

    At the same time, if someone on a boat isn't helping keep it affloat, you don't sink the boat. So, in spite of Yahoo! needing to be slapped -- I'd rather see them slapped with a dose of "hey your products suck" than a bunch of lawsuits by money-grubbing lawyers.

    • No doubt there is some component of incompetence involved, but it's more than that. For example, Overture has a long history of "melting pot" ad placement, even before they Yahoo acquisition. Their advertisers are told about the good neighborhoods where the ads will be seen (Yahoo Search, for example) but not the bad ones (spyware, warez sites). Overture advertisers have no way to "opt out" of any segment of advertising.

  • yahoos (Score:1, Offtopic)

    by gEvil (beta) ( 945888 )
    No kidding. All those damned yahoos in suits are extortionists...

  • The Horror (Score:4, Interesting)

    by Umbral Blot ( 737704 ) on Friday May 12, 2006 @01:40PM (#15319369) Homepage
    Lawsuits filed solely to make money, banish the thought. Who would do such a despicable thing? Seriously though, I am glad someone is speaking out about this practice in the yahoo case, but really something should be done within the legal system to fix the problem as a whole, not just this symptom. One possible solution would be to have lawyers on both sides be paid a fixed rate by the state, which would fix some inequalities, although admittedly individual people might still be motivated by money to sue.

    • Class-action fix (Score:5, Insightful)

      by overshoot ( 39700 ) on Friday May 12, 2006 @01:48PM (#15319476)
      One possible solution would be to have lawyers on both sides be paid a fixed rate by the state, which would fix some inequalities, although admittedly individual people might still be motivated by money to sue.
      If you want to see some real panic in the class-action racket, try this:

      Counsel for the plaintiffs in a class-action suit may not receive any more than is actually distributed to the plaintiffs.

      That's the classic scam: the defendents settle for $100 million, the plaintiffs' law firm get $95 million of it, $5 million is offered to the plaintiff class if they respond to request 20 pages of paperwork to apply for their $0.75 payout; a total of $120 thousand is actually distributed to the plaintiff class members and "their" lawyers pocket the balance.

      Suggest it to your Congresscritters. The ABA and Trial Lawyers' Association will hate it, but if it ever sees daylight nobody will dare vote against it because (unlike a lot of tort reform) it doesn't take a dime from plaintiffs -- the ones they ABA and TLA use to justify their normal way of doing business.

      • Re:Class-action fix (Score:3, Interesting)

        by timeOday ( 582209 )
        Good luck! Most Congressmen are lawyers!

      • Good idea! (Score:2, Insightful)

        by gknoy ( 899301 )
        Wow. That seems like a stunningly good idea. Wish I still had points to mod you up.

        My only question is ... could it have any down sides? If the class of people to distribute to is large enough, would the lawyers be able to fund themselves properly? (Probably ;))

      • Re:Class-action fix (Score:2, Informative)

        by Anonymous Coward
        Class Actions Fairness Act - passed last year. Ignorance must be bliss.

        http://files.findlaw.com/news.findlaw.com/hdocs/do cs/clssactns/cafa05.pdf [findlaw.com]

      • [In the classic scam] defendents settle for $100 million, the plaintiffs' law firm get $95 million of it, $5 million is offered to the plaintiff class if they respond to request 20 pages of paperwork to apply for their $0.75 payout; a total of $120 thousand is actually distributed to the plaintiff class members and "their" lawyers pocket the balance.

        If I recall, this is precisely what happened in the case of Strawargument v. UrbanLegend. Or to be more blunt, I think your engaging in ridiculous hyperbol

      • As with all law, and much of the rest of the world, there are legitimate uses, and illegitimate uses. Limiting a lawyers payout to what an individual plaintiff would get is ludicrous. Consider the lawsuit against the RIAA over price fixing. The individual payout was in the order of $20 or so. It would be silly to expect anyone to work hundreds of hours, win tens of millions of dollars for the community, and only be paid $20 (There might be some who are willing to donate their time for such a cause, but to e
        • Limiting a lawyers payout to what an individual plaintiff would get is ludicrous.
          Not an individual plaintiff, the plaintiff class as a whole.

          The point being to put a stop to cases where the lawyers are the only ones who get paid.

      • I'm more cynical on that. If this idea ever got critical mass & got sponsored *, you'd start seeing massive PSAs and a sudden saturation of anti-reform talking points in the media.

        The "doesn't take a dime from plaintiffs" fact would be lost in the FUD. Everyone would have a vague sense of how a few bad, mean, greedy people were trying to "create roadblocks," "slash the quality of legal representation" and generally "make it harder" for them should they ever need to join forces with other victims of big,
      • I thought lawyers in civil actions were limited to one-third of the total payout, no? Is it different for class actions?
    • I've often thought that lawyers are at the top of human food chain (at least in the US,) since no one is immune to lawsuits. To even defend oneself against such, one needs a lawyer. Regardless of merit or outcome, lawyers win, always.
      • You're not the only one to notice this. It's not even a new phenomenon.

        Charles Dickens wrote a book that's arguably a gigantic illustration of that point: people fight, but the lawyers always win. (I'm talking about Bleak House here, and for those who haven't read it, it's basically about a probate dispute over a large estate that drives a family apart; the punchline is at the end when one guy wins, he does so only to have the entire estate seized and sold off to pay the lawyers and court fees.)
    • How about the loser pays the legal costs of both sides? Nobody would sue unless they were willing to bet a lot of money that their case was merited.
    • The system's out-of-control expenses runs on near-limitless "lawyering".

      So, put a limit on the lawyering. We can even make it voluntary, to wit: there can be two levels of suit.

      Simple Level: State the facts during your filing and let judge/jury decide case. No motions, changes of venue, retractions, or any of that crap. File it (note: the side that fails to file automatically loses) and wait. You barely see a judge/jury, it happens so fast; all the time taken is behind the scenes with clerks shu

  • Huh? (Score:5, Funny)

    by Coleco ( 41062 ) on Friday May 12, 2006 @01:42PM (#15319390)
    Oh I though that's how lawsuits worked. Always.
  • So what else is new. They see a pile of money and want it. It is easier to sue than it is to make a product. Maybe if there are enough suits everyone will go out of business. But nobody will be harming anyone else. If Yahoo! is not putting in keywords, it is their own profits that are harmed.

  • Justice (Score:3, Insightful)

    by McGiraf ( 196030 ) on Friday May 12, 2006 @01:45PM (#15319435)
    It's seem that justice is no more a thing to keep society to a certain standard and give everybody a nice and predictable place to live. It's just a bussiness now, like fast food and diaper manufacturing.
    • >It's seem that justice is no more a thing to keep society to a certain standard and give everybody a nice and predictable place to live.

      Which is not nothing. Ponder Rwanda or Zimbabwe as examples of what happens when you lose the approximation of justice the US has.

  • "The legal issue would likely be whether the statements were actual imputations of a crime, or were 'rhetorical hyperbole,' essentially a statement of opinion, not of fact. The former could be considered libelous, while the latter could not."

    Of course, being it's in a blog, the author, Eric Goldman, wiil no doubt stand up in court and claim it's just his opinion, no matter how vehement the statements were. This should prove a cautionary tale: just because you blog does not necessarily mean you can say

    • He made sure he could claim this as opinion. "I think these lawsuits are...." "I see this lawsuit as..." "I see that process as..." These are fairly obvious opinion statements, not statements of fact. If they were meant as statements of fact, he would not have prefaced them with "I think" and "I see". Instead they would read "These are..." "That is..." etc.
      • Even if he didn't, it would still be statements of opinion not fact.
      • I don't believe that putting "I think ..." in front of a statement automatically gives you carte blanche to make whatever kind of accusation that you want. If I were to state, "I think Bourbon Man likes to fondle little boys", I could probably still get in some trouble.

        I think there is a grey area in the law when stating an "opinion" on something that is really either true or not and not just a matter of personal view. I didn't RTFA and don't mean to imply that this applies here, but thought is was worth

        • If I were to state, "I think Bourbon Man likes to fondle little boys", I could probably still get in some trouble.

          That is actually covered in the law surrounding libel. Firstly, it is divided into two classes. If a statement is made as fact, the statements being true is an adequate defense. Adequate reason to believe it true may suffice.

          If a statement is an opinion, the standard is simply that a reasonable person knowing what you know might hold that same opinion.

          Value judgements fall into the opin

    • This should prove a cautionary tale: just because you blog does not necessarily mean you can say anything you like.

      Why not? There's no obligation that you believe what you read. No sir, the responsibility lies with how you react. Action has consequences. Speech is just that, speech.

    • Wii (Score:1)

      by McGiraf ( 196030 )
      "wiil no doubt stand up in court"

      What is that? Sublimimal advertisement?

    • When NetworkWorld's McNamara asks an opinion from an attorney, the guy quickly digs up two libel verdicts (1903, 1940) and one dismissal (1999).

      The legal issue would likely be whether the statements were actual imputations of a crime, or were 'rhetorical hyperbole,' essentially a statement of opinion, not of fact. The former could be considered libelous, while the latter could not.

      Of course, hyperbole is the eye of the beholder ... or juror.

      In my opinion, today's average juror would look at Prof. Goldman's

  • link to the blog post in question (Score:3, Informative)

    by DrSbaitso ( 93553 ) on Friday May 12, 2006 @01:46PM (#15319453)
    for some reason, it's not in the headline.

    Technology & Marketing Law Blog [ericgoldman.org]

  • Why? (Score:2)

    by gid13 ( 620803 )
    "Even unmeritorious class action lawsuits are expensive to defend"
    Assuming for a second that the quoted individual isn't full of it, why are any unmeritorious lawsuits expensive to defend? Don't courts do things like order one party to pay the other's legal fees in cases like that?

    • Re:Why? (Score:5, Informative)

      by overshoot ( 39700 ) on Friday May 12, 2006 @01:57PM (#15319569)
      Assuming for a second that the quoted individual isn't full of it, why are any unmeritorious lawsuits expensive to defend? Don't courts do things like order one party to pay the other's legal fees in cases like that?
      He's not, they are, and the court's don't.

      The main reason is that Federal Rule of Civil Procedure #10 is basically a dead letter.

      • "Professional courtesy" means that other lawyers won't accuse an abuser of being abusive because the rest of the legal community will retaliate. Nobody likes a snitch.
      • The Court won't because it just means more work, and they're too busy as it is. Besides, the Court of Appeals will probably reverse anyway.
      • For a suit to be legally frivolous requires that a whole bunch of lawyers decide that there was no conceivable way that there was the slightest shred of argument to support it. Gimme a break! These are lawyers -- their training, their whole point in existence, is finding something to argue about.

    • Re:Why? (Score:2, Insightful)

      by dfl ( 808355 )
      Though rare, courts do order the loser to pay fees when the suit is deemed frivilous. A famous (but extreme) case forced Mattel to pay $1.8M to an artist whose lawyer argued the whole case for free. http://www.usatoday.com/money/industries/2004-06-2 9-barbie-trial_x.htm [usatoday.com]

      If the case is truly frivilous, it will cost as much to prosecute as to defend, so there is no way to "extort" money. Moreover, a billion-dollar company can afford to pay $20K to get a case dismissed. A lawyer so desperate for work that

  • Loser pays should be the way (Score:3, Interesting)

    by vodkamattvt ( 819309 ) on Friday May 12, 2006 @01:53PM (#15319537) Homepage
    This is another reason why we need reform in litigation, especially in a litigation prone society such as the US. Loser pays attorney fees for the winner, problem solved.

    Yes, I am aware there are problems with this also (loser can't pay, etc). But it is definately a start.

    • I agree. There needs to be some protection for the little guy (like he shouldn't have to pay for the defendents [i]team[/i] of lawyers when a [i]team[/i] was clearly not necessary), but overall a loser pays system would do a lot of good for our legal system. We just need to make sure it doesn't do any bad for people who can't afford some big companies $10M legal team.
    • And what about, for example, if you lose a 6 month long case against, say, the RIAA?
    • Agreed.

      I'd limit it to his own attorney costs to avoid people engaging frivolent huge lawyer armies.

      E.g. :
      - I engage one 50k lawyer
      - the other engages a team of 10 100k lawyers
      - I loose
      - I pay 50k for my lawyer and 50k for the other lawyers
      - the other 950k are paid by the other team

      This way, everybody (whos confident to win) can afford a legal defense as good as the guy sueing him. If you want a better defense, you have to pay it yourself.

      Still needs some rules to consider variable costs (e.g. an attorney t

      • That's WAAAY too complicated. Sounds like somethng a lawyer would dream up ...

        Shakespeare said it best:

        The first thing we do, let's kill all the lawyers.

        -- Shakespeare, King Henry VI

        Here's a bunch more lawyer quotes http://www.power-of-attorneys.com/funny_lawyer_jok es.asp?type_ID=2&page=1 [power-of-attorneys.com]

        If lawyers have such a bad reputation, its because they are not willing to clean up the act of those around them. Bar associations are, by and large, a joke. Sanctions? More like "Sue me!" A better plan w

        • The problem with this approach is that it favours the more articulate participant. When you explain the situation, you will put a spin on it that paints you in a positive light. When the other party presents the situation, they will do the same. If one of you is more intelligent, literate, or has had the benefit of more education, then they have an immediate advantage. Lawyers were introduced to help counter this.

          The problem now is that the same advantage exists, it is just reserved for the richer part

          • Judges are smart enough to sort through the smarmy eloquence and get to the truth. Lawyers actually interfere with this process by tapdancing around the truth. Just look at the crapflood from SCO and their lawyers. Does anyone believe Darl could have lasted more than a day in court by himself?
    • That is definitely not a start. That's an inane idea.

      This would literally give large corporations the ability to drive smaller businesses and individuals into the poorhouse. They could exploit tiny loopholes in the law to "win" a case that right now would carry no financial gain. But under your system, they just tack on 100-200 lawyers and legal aides (not uncommon) to their side of the case and voila, the small guy who just lost a silly case has to pay a large corporation millions of dollars. Companies cou
    • Bring back trial by combat, I say. I want to see Ringo Starr versus Steve Jobs. With broadswords.

      I'd pay 99c to download THAT!

      TWW

  • Typically of the kind of problem that arises when you rely on automated spell checking. This guy actually wanted to call them 'contortionists' not 'extortionists'. All very innocent you see.
  • I'm sorry, I think there are lots of things the different branches of the government should do. Trying to adjudicate puerile squabbles between lawyers isn't one of them. Neither is resolving disputes about on-line advertising, unless they have something to do with anti-trust enforcement or blatant trademark infringement.
  • They can make this argument to defendants: settle with me for a fraction of your total expected defense.

    This is otherwise known as the Michael Jackson defense.
  • Why is this news? Most institutions set up in the US to protect business participate in making the US a cleptocracy. So what if a lawyer takes a big piece on the pie when a company gets big enough to be a target for a class action? How is this any different from patent holding companies, business lobbies, government, unions, various associations, or anyone else who wants a cut?

  • "Fair comment or libel?" (Score:2, Informative)

    by Jeian ( 409916 )
    Fair comment or libel?

    I think in order to be libellous, it has to be untrue.
  • I wonder if he's heard of the RIAA or MPAA?

    "They can make this argument to defendants: settle with me for a fraction of your total expected defense costs, and we're both better off (defendants save some defense costs, plaintiffs' lawyers grab some personal loot).'"

  • Largesse? (Score:2, Funny)

    by mooncaine ( 778422 )
    "Even unmeritorious class action lawsuits are expensive to defend, so the plaintiffs' lawyers can exploit those defense costs for their personal largesse."

    That sentence doesn't make sense. What do you think is meant by "for their personal largesse"? Largesse doesn't make sense here. The plaintiff's lawyers can exploit those defense costs for their personal generosity? More likely, the writer meant "personal benefit".

    Writing is like code that runs in your readers' heads. This code is buggy.

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