On January 16, 2012, attorneys filed a class action against Amazon.com relating to an online hacking attack that compromised the personal information of up to 24 million customers of its online shoe retailer, Zappos.com.  Data Breach Legal Watch reported that less than 24 hours after the breach occurred, the plaintiffs’ bar had already filed a Complaint claiming that the attack resulted in the exposure of the following:

Names;
Addresses;
Telephone Numbers;
Email Addresses;
Passwords (cryptographically scrambled); and
The Last 4 Digits of Credit Card Numbers

The attack did not expose the social security numbers or complete credit card numbers of customers.  Nonetheless, the Complaint claims that customers will be exposed to “phishing” attacks that are tailored to the compromised information, as well as anxiety, emotional distress and loss of privacy.  Further, similar to the Sony data breach case, the Complaint seeks compensation for the costs of identity theft insurance and credit monitoring.  
Data Breach Legal Watch notes that, aside from the Hannaford decision that the 1st Circuit recently published, courts have generally rejected fear of identity theft claims, requiring a showing of some actual harm to the individuals affected by the breach.  This breach, however, did not expose complete credit card numbers like in Hannaford or several of the hacking attacks directed at Sony.  It would seem that Zappos is unlikely to be on the hook for anything beyond being forced into providing identity protection and/or monitoring for its customers.  However, the cumulative effect of these data breaches and the class actions that inevitably follow will likely be greater data security within internet industries.
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Listen up, all you internet users (which is basically everybody but my mother, who still views the Internet as the work of the devil, and will quote from the book of Revelation in support of her theory).  Three bills you need to be aware of, because they may change the way you view (or more correctly, the way you are allowed to view) the Internet.  and from what I’m reading, there are some pretty darned big sites and companies that are ready to either “go dark” in protest (Wikipedia, for example, which is where I do most of my legal research) or lend a big supporting hand to the protests of the current bills being considered (Google is one – who can live a day without Googling something?  I mean for cryin’ out loud the Company has made itself into a verb!!).  Those bills are:

1.  Stop Online Piracy Act (or “SOPA”).

2.  Preventing Real Online Threats to Economic Creativity and Theft of Intellectual Property Act (PROTECT IP or PIPA, which is easier but less descriptive.  I’ve never seen a bill with a name so long it requires not one but two abbreviations).

3.  The Online Protection & ENforcement of Digital Trade Act (or “OPEN” Act – again- what is it with thinking up names for these acts? But I guess “OPAENDTA” doesn’t quite roll off the toungue).  

Sounds simple enough, right?  I mean, who doesn’t want to stop people from stealing stuff and using the Internet to get away with it? Uh, hold on--not so fast there, scooter.   Here’s a quick overview, along with the pretty darned serious problems that exist.  The main thought is that there is a serious problem (which there really is) regarding piracy on the Internet.  As paraphrased from the OPEN site (http://keepthewebopen.com) the problem can be illustrated like this: downloading a movie from a foreign website is like buying a foreign product, but there really aren’t any trade laws equipped to deal with the online purchases from foreign sites.  

The SOPA bill allows the Department of Justice and copyright holders to seek court orders against websites accused of enabling or facilitating copyright infringement.  The court order could include barring online advertising networks and payment facilitators from doing business with the allegedly infringing website, barring search engines from linking to such sites, and requiring Internet service providers to block access to such sites. The bill would make unauthorized streaming of copyrighted content a crime, with a maximum penalty of five years in prison for ten such infringements within six months. The bill also gives immunity to Internet services that voluntarily take action against websites dedicated to infringement, while making liable for damages any copyright holder who knowingly misrepresents that a website is dedicated to infringement.

Proponents of SOPA say it protects the intellectual property market and corresponding industry, jobs and revenue, and is necessary to bolster enforcement of copyright laws, especially against foreign websites.   Opponents say that it violates the First Amendment, is Internet censorship, and will threaten whistle-blowing and other free speech actions. A number of protest actions have been planned, including boycotts of companies that support the legislation, and major Internet companies “going dark” for a day (coinciding with hearing dates).  

PIPA (or ‘PROTECT IP”, or whatever else you want to call it), appears to be SOPA’s twin, but in the Senate.   

OPEN is, from what I can glean, a “bipartisan” bill written in response to the harsh criticism SOPA is receiving. (I always tend to squint my eyes when I see the word “bipartisan”).  
Even the White House has entered the fray, with a post just a few days ago regarding the subject.  Here’s a part of that post:  

Any effort to combat online piracy must guard against the risk of online censorship of lawful activity and must not inhibit innovation by our dynamic businesses large and small.

And when the White House says “whoa”, you know there is likely a heckuva lot of pressure (political, economic, you name it) coming down against the proposed Act.  

So who’s right?  Well, everybody.  Is there a lot of intellectual property piracy on the open internet seas?  Absolutely.  Does it need to be dealt with?  No question.  Do the SOPA and PIPA bills overreach and create more problems than they purport to solve?  Yep.  The bills do use the U.S. Court system to create a type of “internet police” as it pertains to copyrighted material.  They also greatly increase the work flowing to litigators and litigation firms among other things, driving up (WAY up) the cost of doing business, which will most certainly hurt businesses generally and small businesses especially,  because whether they are involved or not, others will be so involved, which will drive up the overall cost of products across the board as the increased cost is passed on to the consumer as much as possible.  And how/why is it that the US Courts will be essentially graced with the responsibility of policing the Internet for the entire world?    
Now that I’ve lit the fire and started the debate, feel free to discuss amongst yourselves (hey- it isn’t my job to give answers, just point out the questions).    
  
Jeffrey Curran is Of Counsel with Gable Gotwals in Oklahoma City, OK

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Law.com has an interesting blog post about a recent defense tactic in the case of an alleged “mouse in a can of soda,” you can find the article here. Basically, the defendant is taking a scientific stand regarding the presence of a mouse allegedly sealed in a can of soda. Essentially, they are saying that a whole mouse would not be present in a sealed can, because the acid in the drink would have turned it to jelly. The beverage giant  may need to start competing with jelly and jam companies.  The position may be technically viable but it appears be a public relations nightmare. Do you think this is an effective stance? Does it do more harm than good? Let us know your thoughts.

Jobby is an associate in the Oklahoma City firm of Hiltgen & Brewer, P.C.  

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Welcome one and all to something that will undoubtedly change both history and the world as we know it:  the first installment of what will hopefully be a regular publication which we have decided to call From the “What the…?”File.  Basically, I’ll be picking up on out-of-the-mainstream stuff which any of us could have lived without knowing, but it will at least be stuff that is both interesting and has a bit of a twist.  At least in theory, anyway.  So, without further ado, here goes the collector’s item first issue.  I can confidentially say that that when you’re done, you too will be saying “What the…?”

 

European Copyright – The Write Stuff?

OK, not many of us care about Euro Copyright issues – I fully admit that.  But this is actually kind of interesting (even if it is Euro-centric).  It seems that way back in 2006, a Hollywood-funded, Netherlands-based anti-piracy group (known as ‘BREIN’, and please don’t ask me what it stands for) asked a musician to compose music for an anti-piracy video. The video in question was to be shown at a local film festival, and under these strict conditions the composer accepted the job.

However, the anti-piracy ad was recycled for various other purposes apparently without the composer’s permission. When the composer bought a Harry Potter DVD early 2007 (presumably a licensed one), he noticed that the campaign video with his music was on it. According to the composer And this was no isolated incident. He is now claiming that his work has been used on tens of millions of Dutch DVDs, without him receiving any compensation for it. The total claimed lost revenue is roughly a million Euros (which is about $1.3 mil US). 

But wait -- there’s more.  You’d think that the guy would have received some collection support from local rights societies.  You’d think.  But soon after he discovered the unauthorized distribution and after contacting a local music royalty collection agency not only did he not receive any royalties, one of their Board members offered to help ONLY if the composer assigned all his rights to the organization AND gave the guy a third of what was collected.   Ultimately the board member resigned and the anti-piracy group denied it was their fault in the first place.  But what’s more shocking – that anti-pirates are pirates themselves, or that there is corruption in the music industry? Hmmm – tough question.

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In 1997, New York passed N.Y. Unconsolidated Law §8905-a, a statute that prohibits professional “combative sports,” including mixed-martial arts (MMA) events and associated activities.  Even speech that promotes MMA is barred.  On Nov. 15th, after more than a decade of failed efforts trying to have the law repealed via legislative means, several plaintiffs filed suit in the SDNY challenging the constitutionality of the statute.  They include (1) Zuffa, LLC, d/b/a the Ultimate Fighting Championship (UFC), the largest promoter of MMA in the U.S., and (2) several MMA fighters, including Ms. Gina Carano, often called the “Face of Women’s MMA,” #16 on Maxim Magazine’s 2009 “Hot 100” list, and, hopefully, an incurable future stalker of mine.  They allege that the law, which targets only pro MMA and exempts boxing and standard martial arts altogether, violates several constitutional protections, including the freedom of speech and equal-protection clause.  The UFC wants to stage events in New York, regardless of how that is made legal.  Says UFC Vice President Mark Ratner, "Every arena small and big has been asking us to come, and it's just nonsensical that the sport has not been approved yet."  Mr. Ratner likely will get his wish soon.  The law looks to be doomed, either through judicial action or via the lawmakers and other forces that brought it to life.  


1.  History and Growth of MMA

MMA, which involves both striking and grappling, often is described as a combination of boxing, Greco-Roman wrestling, and at least a half-dozen different martial arts, including kickboxing, jiu-jitsu, and judo.  Fighters face off in a boxing-type ring and score points by landing blows.  As in boxing, MMA matches end when one combatant (a) "taps out" - meaning he or she leaves the ring voluntarily – , (b) is knocked out, or (c) when time expires, at which judges select the winner. 

MMA traces its roots both to Greek and Roman sport of  Pankration, which featured a combination of grappling and striking skills, and the various forms of martial arts that evolved in East Asia over a millennia ago.  In the 19th and early 20th centuries, it remained a minor sport in many parts of the world, but steadily gained momentum in Japan and Brazil.  The late Bruce Lee is sometimes called the “father” of MMA because he combined the best of boxing, karate, judo, and other martial arts to create “the style of no style.”  In 1990, Mr. Arthur Davie, a Los Angeles advertising executive, former Marine, and fan of MMA since seeing a bout between an Indian wrestler and a Thai boxer when on leave during duty in Vietnam, began exploring the idea of whether MMA could be brought to the greater world stage.  In 1993, with the help of several people, including the Gracies, a famous Brazilian family known for its dominance of Vale Tudo ("anything goes" in Portuguese), Mr. Davie “officially” introduced MMA in the U.S. 

During its early years in the U.S., MMA was a lightly-regulated and self-described “no holds barred” sport.  It offered a feral, non-stop, all-body combat alternative to the hands-only and regularly-boring boxing, which often involved bouts dominated by opponents leaning on one another in something akin to a slow and sweaty prom dance.  MMA was limited to pay-per-view and obscure cable channels.  Over the next 15 years, it steadily grew, not only in terms of popularity, but in organization, safety, and professionalism.  In 2008, CBS introduced MMA to network TV via an EliteXC event that drew 6.8M viewers.  FOX recently inked a seven-year deal with UFC and hosted a network event that peaked with 8.8M viewers.  MMA now reportedly appears on television in 155 countries and in 22 different languages.  In January, approximately 1.4 million people watched a single MMA event on pay-per-view that reportedly grossed $110 million.  HBO is now allegedly interested in airing MMA events.  No longer a pariah sport, it is now sponsored by the U.S. Marines, Dodge, and Harley-Davidson.  

2.  Of Politics and Pugilists

MMA’s early efforts to gain popularity created a polarizing effect that ultimately led to the creation of §8905-a.  Having no advertising budget, it promoted the “savagery” of MMA and adopted catch phrases such as “no rules” and "Two men enter.  One man leaves."  In so doing, it created shock value that turned legitimate press into free advertising.  MMA was the real version of the fake “wrestling” that Americans had been watching for decades.  Like a highway accident, the MMA fascinated some and repulsed others.  Unfortunately, the “others” included concerned a large block of NY legislators, who compared MMA to cockfighting.  ''I think extreme fighting is disgusting. It's horrible," New York Mayor Rudy Giuliani said at the time. “[T]his is way beyond boxing. This is people brutalizing each other.''  Others politicians jumped on the bandwagon, and the law passed quickly.

Depending on whom you believe, other forces beyond the anti-violence crowd were at work.  New York was, and is, a world hub of professional boxing, having hosted at Madison Square Garden some of the greatest boxing matches of the 20th century.  Some supporters of MMA claim that NY politicians were overtly influenced by some of the most powerful people in the boxing industry, who viewed MMA as a threat to boxing’s future.  Former UFC promoter Campbell McLaren alleged that the enacting of the law “was done in a very illegal and bogus manner.”

3.  Legal Arguments

The plaintiffs argue that the ban is unconstitutionally vague, irrational, and violates various other protections, including the freedom of speech, the freedom of expression, the commerce clause, and the equal-protection clause.  

Irrationality and Equal Protection  

The plaintiffs claim that the law, if it ever was rational, is now really irrational because the claimed impetus for §8905-a, i.e., protecting professional MMA athletes from a no-rules barbarity, is all but gone.  They assert that today's professional MMA bouts are highly monitored and governed by new rules for fighter safety, including weight classes and timed rounds.  UFC even provides accident insurance for its athletes and covers injuries suffered both inside and outside of the gym or arena.  The plaintiffs also argue that MMA is actually safer than other, more mainstream contact sports, such as boxing, ice hockey, equestrian sports, football, and rodeo, all of which are legal in New York.  Further, they contend that with grappling and wrestling such an integral part of MMA, many fighter's careers can last much longer than those of boxers because fighters do something other than throw punches to the head and body.  Further, unlike football, opponents have to fight face-to-face, vastly reducing the likelihood of a blind-side hit.  

If supported by substantial evidence, all of this raises substantial equal-protection issues.  During a February 2011 interview with MMA radio, NY Assemblyman Robert Reilly (D-Latham), the loudest anti-MMA voice in the state, appeared to have conceded as much:  “Well, . . . I do want to not be, um . . . too contentious when I say this. . . . but today I don’t think professional boxing . . . would be legalized in many states today because of the danger to the fighters.”  

Nonsensical Law

The logic behind other aspects of the law is elusive.  Why does it only apply only professional MMA?  Says Barry Friedman, one of the plaintiffs’ attorneys, "Amateur bouts under the statute seem to be fine.   It's just professionals that are banned, so it sort of doesn't make any sense on its own terms."  Why is the mere promotion of professional MMA banned under the law?  Will New York citizens wilt if they see an ad for an MMA bout?  They already are able to watch MMA on television.  If the goal is to protect the populace from violent images, NY may as well try banning many other violent things, including violent movies, TV shows, and video games. 

Freedoms of Speech and Expression 

According to Atty. Friedman, no court has ever directly confronted the question of whether athletes have a First Amendment right to be seen in action.  “It’s martial artistry,” he said. “The nature of martial arts is a lot like dancing.”  "The First Amendment protects what's called expressive conduct, which is doing physical things that express ideas, with anything from a parade to a dance being protected.  Our argument here is that mixed-martial arts constitute expressive conduct.  I can't think of another example of a sport that's safe and regulated, and has been banned."  

Even if the law is found not to infringe on the freedoms of speech and expression, it is difficult to argue that it does not impinge upon personal liberties.  All pro MMA athletes are adults who freely choose to participate and operate in a controlled private environment.  As one online commenter stated, “What are we trying to do, protect fighters from themselves? What's next, New York legislating the amount of force used in hockey checks or football tackles?  Get the hell out of the way and let these adults do what they want to do.   The money [that pro MMA could bring to NY] is a secondary benefit.  Our liberty to do what we want, accepting the consequences, is the more important issue.”

4.  Time for Law to “Tap Out”

In one way or another, §8905-a is on its way out.  If the SDNY does not reject the statute, for one or more of the following reasons, others soon will succeed in having MMA exempted from it.  

First, in the midst of the worst national economy since the Great Depression and an NBA season that appears to be lost, New York, generally, and the Madison Square Garden owners and workers, especially, need every dime they can collect.  As stated by UFC CEO Lorenzo Fertitta, "Denying fighters the chance to exhibit their training and skills before a live audience and denying thousands of New Yorkers the ability to watch their favorite fighters perform live is not only an injustice to them, but to the local markets that would reap tremendous economic benefits from hosting competitions.”  Said Derek Crouse, of bleacherreport.com, “For a city that loves to tax everything, why wouldn’t they jump on the golden goose of the UFC, whose popularity is skyrocketing faster than anything in sports?”  Finally, with state budgets being slashed and all state employees being asked to do more with less, don’t the offices of the NY Atty. General and NY Dist. Atty. of New York and have better things to do than defend this statute? 

Second, the forces of business that donate to political campaigns eventually will convince NY lawmakers to rewrite the law.  With both CBS and FOX supporting MMA, other large media entities will not be far behind.  Further, expect the news arms of both companies to start reporting about the “ridiculous” NY law.  And if one needed any further sign that the Apocalypse is upon the supporters of §8905-a, on November 5th, USA Today reported that Don King is entering the realm of MMA.   That’s THE Don King - the face of boxing promotion for the last half-century and an ardent critic and detractor of MMA for the last two decades.  King now calls MMA a "sophisticated barbarism," and stated "I'm looking forward to doing [MMA], too, and creating a competition between the UFC and whatever I call the MMA company that I put together." He predicted that MMA will complement, but never overtake, the "sweet science" of boxing.  Ignore the sweet hype.  This is the functional equivalent of boxing leadership facing reality and throwing in the towel. 

Third, where economics and business lead, politics generally follow.  As a group, New York Republicans largely have supported MMA for years.  Several efforts to overturn the ban through legislation have stalled out for various political reasons, including the latest attempt over the summer.  In May 2011, the New York State Senate, which is slimly held by Republicans voted overwhelmingly (42-18) in favor of a bill that would sanction pro MMA, but the bill stalled in the Assembly Ways & Means Committee, which includes Mr. Reilly and reportedly is controlled by Democrats.  Mr. Reilly and his colleagues find themselves on an increasingly- lonely island.  Even the most liberal Democrats in the country are pushing for pro-MMA’s entry into New York.  In 2010, Harry Reid, Democratic Senator of UFC’s home state of Nevada, told the AP that UFC bouts were well-regulated “fair street fights” with “somebody watching every move [the athletes] make.”  He added, “I'm going to see what I can do to help [professional MMA] in New York.  I'm aware of the issue, . . . I know a few people in New York[, and] I'm going to see if I can talk a little sense to them.”  So far, sense has not prevailed. 

Bill Staar is a partner in the Boston office of Morrison Mahoney LLP, Chair of DRI's Sports Law & Entertainment Group and member of the Sporting Goods Manufacturers Association’s Legal Task Force.  He concentrates in the areas of product liability, construction disputes, toxic torts, and general business litigation. He also is a member of DRI's Product Liability, Commercial Litigation, and Construction Law Committees.

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Ad Age recently posted an article addressing the meteoric rise and overwhelming dominance of the smartphone.  At the end of this holiday season, over 50 percent of mobile phone users will be using a smartphone.  A year from now, that figure is projected to almost double, to 90 percent of mobile users.  Moreover, smartphone capabilities are growing almost as fast as their market saturation.  I regularly use my phone as a search tool, GPS, communications device (most of which centers on e-mail) and social hub, and I do not consider myself to be a “power user.”  Despite the amazing smartphone developments of the past 5 years, there are more on the horizon.  If the experts are right, we will soon be using our phones in place of our wallets, for identification and point of sale purchases.  Phones could be used to unlock and start our cars and to open our garage doors and set our home thermostats.  This week, conference attendees will be using the DRI smartphone App to keep track of their schedule and contact other attendees.  However, like most any “smart” device, the more we use our phones the more data we generate regarding our whereabouts, activities and lifestyles.

Attorneys used to subpoena cell phone records to see if litigants were on their phones at the time of an injury or during an auto accident.  Already, Historical Cellular Reconstruction (HCR) can be used to provide the history of a phone’s probable location, regardless of whether a user was actually on their phone.  HCR is not based on GPS data, but upon data and information maintained by the cellular provider related to a particular cell phone’s connection to a given cell tower.  Although HCR does not result in pinpoint precision, it can often place a phone within a very small vicinity.  If a user’s cell phone is turned on and the GPS is in operation, the precision increases dramatically.

Now attorneys look for information and material addressing whether a litigant was texting, surfing the web, on Facebook or taking one of virtually countless actions on their cell phones during the time of a given event, or in the hours and days leading up to a significant event.  Lawyers can use cell phone records to compare the location of a litigant to their claimed location.  This is particularly relevant where litigants, such as commercial drivers, are required to routinely log their position.  Records may indicate that an allegedly injured party went to an amusement park, or that an allegedly incapacitated person made a purchase.  The possibilities already seem endless, and as smartphone services continue to expand, so will the potential for using the resulting data in litigation.  As more and more opportunities are created by smartphone data, attorneys need to remain mindful of the fact that there may be data available that will impact their case.  

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In “RULE OF EVIDENCE 703 — Problem Child of Article VII (Sept. 19, 2011),” I wrote about how Federal Rule of Evidence 703 is generally ignored and misunderstood in current federal practice.  The Supreme Court, in deciding Daubert, shifted the focus to Rule 702, as the primary tool to deploy in admitting, as well as limiting and excluding, expert witness opinion testimony.  The Court’s decision, however, did not erase the need for an additional, independent rule to control the quality of inadmissible materials upon which expert witnesses rely.  Indeed, Rule 702 as amended in 2000, incorporated much of the learning of the Daubert decision, and then some, but it does not address the starting place of any scientific opinion:  the data, the analyses (usually statistical) of data, and the reasonableness of relying upon those data and analyses.  Instead, Rule 702 asks whether the proffered testimony is based upon:

1. sufficient facts or data,
2. the product of reliable principles and methods, and
3. a reliable application of principles and methods to the facts of the case

Noticeably absent from Rule 702, in its current form, is any directive to determine whether the proffered expert witness opinion is based upon facts or data of the sort upon which experts in the pertinent field would reasonably rely.  Furthermore,  Daubert did not address the fulsome importation and disclosure of untrustworthy hearsay opinions through Rule 703.  See Problem Child (discussing the courts’ failure to appreciate the structure of peer-reviewed articles, and the need to ignore the discussion and introduction sections of such articles as often containing speculative opinions and comments).  See also Luciana B. Sollaci & Mauricio G. Pereira, “The introduction, methods, results, and discussion (IMRAD) structure: a fifty-year survey,” 92 J. Med. Libr. Ass’n 364 (2004); Montori, et al., “Users’ guide to detecting misleading claims in clinical research reports,” 329 Br. Med. J. 1093, 1093 (2004) (advising readers on how to avoid being misled by published literature, and counseling readers to “Read only the Methods and Results sections; bypass the Discuss section.”)  (emphasis added).

Given this background, it is disappointing but not surprising that the new Reference Manual on Scientific Evidence severely slights Rule 703.  Using either a word search in the PDF version or the index at end of book tells the story:  There are five references to Rule 703 in the entire RMSE!  The statistics chapter has an appropriate but fleeting reference:

“Or the study might rest on data of the type not reasonably relied on by statisticians or substantive experts and hence run afoul of Federal Rule of Evidence 703. Often, however, the battle over statistical evidence concerns weight or sufficiency rather than admissibility.”

RMSE 3d at 214. At least this chapter acknowledges, however briefly, the potential problem that Rule 703 poses for expert witnesses.  The chapter on survey research similarly discusses how the data collected in a survey may “run afoul” of Rule 703.  RMSE 3d at 361, 363-364.

The chapter on epidemiology takes a different approach by interpreting Rule 703 as a rule of admissibility of evidence:

“An epidemiologic study that is sufficiently rigorous to justify a conclusion that it is scientifically valid should be admissible,184 as it tends to make an issue in dispute more or less likely.185"

Id. at 610.  This view is mistaken.  Sufficient rigor in an epidemiologic study is certainly needed for reliance by an expert witness, but such rigor does not make the study itself admissible; the rigor simply permits the expert witness to rely upon a study that is typically several layers of inadmissible hearsay.  See “Reference Manual on Scientific Evidence v3.0 – Disregarding Study Validity in Favor of the “Whole Gamish” (Oct. 14, 2011) (discussing the argument put forward by the epidemiology chapter for considering Rule 703 as an exception to the rule against hearsay).

While the treatment of Rule 703 in the epidemiology chapter is troubling, the introductory chapter on the admissibility of expert witness opinion testimony by the late Professor Margaret Berger really sets the tone and approach for the entire volume. See Berger, “The Admissibility of Expert Testimony,” RSME 3d 11 (2011).  Professor Berger never mentions Rule 703 at all!  Gone and forgotten. The omission is not, however, an oversight.  Rule 703, with its requirement of qualifying each study relied upon as having been “reasonably relied upon,” as measured by what experts in the appropriate discipline, is the refutation of Berger’s argument that somehow a pile of weak, flawed studies, taken together can yield a scientifically reliable conclusion. See “Whole Gamish,” (Oct. 14th, 2011).

Rule 703 is not merely an invitation to trial judges; it is a requirement to look at the discrete studies relied upon to determine whether the building blocks are sound.  Only then can the methods and procedures of science begin to analyze the entire evidentiary display to yield reliable scientific opinions and conclusions.


The author, Nathan A. Schachtman, is in private practice in New York City, and is a lecturer-in-law at the Columbia Law School.  He keeps a web log of musings on tort and evidence law at his website: schachtmanlaw.com

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NBA Lockout: The Latest

Posted on October 20, 2011 02:19 by Bill Staar

NBA owners and players continue to try to execute a new collective-bargaining agreement (CBA). The first two weeks of the regular season are gone. On October 10th, NBA commissioner David Stern cancelled all games originally scheduled from Nov. 1 through Nov. 14. Although some see light at the end of the tunnel, nothing clearly has indicated an imminent end to the lockout. While the parties are locked up in mediation, the rest of us are fed secondary related stories, some less entertaining than others. 

A. Close to and End?
A 16-hour marathon mediation session stretched from 8 a.m. Tuesday morning to 2 a.m. Wed. morning. The sides reportedly remain divided mostly by two issues -- the division of revenues and the structure of the salary cap system. Despite federal mediator George Cohen’s request that all parties remain silent, vague reports of "significant progress" have been whispered from the lips of alleged insiders. In the last CBA, the players took a 57% share of revenues. They have since offered 53%. The league wants a 50-50 split, which increases to a 51% share to the players if certain revenue projections are met. Talks resumed on Wednesday morning and will continue on Thursday. One prominent NBA veteran agent/attorney, Steve Kauffman, said he has noticed an increase in calls from NBA teams in recent days looking to "expediate" contract talks with assistant coaches. Kauffman sees this as an indication that owners believe something big is about to happen. 

Assuming that Wednesday’s and Thursday’s talks fail, it is not clear as to the next deadline that will result in the loss of additional portions of the season. Some have speculated that the informal deadline is the end of this week, although no one from the league has claimed as much. 

B. Delay Breeds Nonsense
The continued delay has led to some unintended and regrettable comedy on behalf of the players and at least one of their supporters. The players recently launched a "Let us play" Twitter campaign, which reportedly often pleads for "fairness." Apparently, this is supposed to conjure images of a small powerless child being locked in his room by a evil parent. C’mon, guys.

Even more disturbing is a bizarre statement by sportscaster Bryant Gumbel at the close of his HBO Real Sports television show earlier this week. Casting impartiality to the wind, Mr. Gumbel accused Commissioner Stern of standing in the way of a solution to the league's labor dispute:

If the NBA lockout is going to be resolved anytime soon, it seems likely to be done in spite of David Stern, not because of him. The NBA's infamously egocentric commissioner seems more hell bent lately on demeaning the players than on solving his game's labor issues. His efforts are typical of a commissioner who has always seemed eager to be viewed as some kind of modern-day plantation overseer, treating NBA men as if they were his boys. . . . His moves are intended to do little more than show how he's the one keeping the hired hands in their place.

Mr. Stern is a tough negotiator. To be sure, he has threatened to cancel games and followed through. He does not bluff. Stern also allegedly has said that the players are being misled by their union. Is that in poor taste? Maybe. Is it a legitimate negotiating tactic, especially if he believes it to be true? Of course. None of this makes Mr. Stern a racist, much less a man who desires to a plantation overseer. 

Mr. Gumbel’s comments are shameful, and unless he is prepared to offer evidence of Mr. Stern’s racism, he should issue an apology to Mr. Stern immediately. Sadly, he now joins a growing list of African-American sports writers and athletes who scream racism whenever black athletes don’t get their way. This list includes Jason Whitlock, who in 2010 alleged accused the NCAA of slavery in its investigation of Reggie Bush for actions in violation of NCAA standards, i.e., "Reggie Bush is Kunta Kinte, a runaway slave." It also includes Minn. Vikings running back Adrian Peterson who, in March of this year, reportedly told Doug Farrar of Yahoo Sports the following in response to a question about ongoing labor negotiations with the NFL: "It's modern-day slavery, you know?" This from a guy scheduled to make about $10 million in 2011. I’ve never heard of slaves making anything close to that type of money. Where are they? Where do I sign up? 

C. Potential Third-Party Suits
The city of Memphis reportedly is considering bringing a lawsuit against the NBA if the league cancels more games or the entire 2011-12 season. The Memphis Grizzlies needed city bonds to help put together their home at the FedEx Forum, and the city's taxpayers stand to foot a hefty $18M bond-payment bill if the entire season is cancelled. They city also is considering raising property taxes to pay for the bonds. 

D. Top Players To Play Overseas? 
Any continued work stoppage is not going to harm the pockets of the league’s top players. According to ESPN, LeBron James, Kobe Bryant and Dwyane Wade are among the locked-out NBA stars who could be making a world tour during what would have been the first two weeks of the season. Citing unnamed sources, the US-based sports network's website said plans were in the works for groups of NBA superstars to play between October 30 and November 9 in London, Macau, Australia, and Puerto Rico. Two games would be played in Australia and London, and all games would be played in venues of at least 15,000 seats. Among the others who reportedly could be involved are Derrick Rose, Carmelo Anthony, Chris Paul, Amare Stoudemire, Chris Bosh, Paul Pierce, Carlos Boozer, Rajon Rondo, Blake Griffin, Russell Westbrook, Kevin Durant, and Kevin Garnett.

Bill Staar is a partner in the Boston office of Morrison Mahoney LLP. He concentrates in the areas of product liability, construction disputes, toxic torts, and general business litigation. He is a member of DRI's Product Liability, Commercial Litigation, and Construction Law Committees, Vice Chair of DRI's Sports Law Group, and member of the Sporting Goods Manufacturers Association Legal Task Force.

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Former NBA legend Bill Russell has recently brought a suit against the National Collegiate Athletic Association (“NCAA”) (Russell v. NAT’L Coll. Athletic Ass’n., 11-04938, U.S. District Court, Northern District of California).  Russell’s suit is one of several the NCAA is currently facing revolving around alleged violations of federal antitrust laws.  Russell alleges the NCAA used his likeness from his days as a collegiate athlete at the University of San Francisco, where he led the men’s basketball team to national championships in 1955 and 1956.  He also claims that the NCAA has violated federal antitrust laws by preventing former student athletes (football and basketball) from being compensated for the commercial use of their images and likenesses.  Russell alleges that the NCAA sells videos of the championship games he led his team in for $150, without compensating the featured athletes.

Electronic Arts, Inc., (“EA”) is also named as a defendant in the suit.  As the second largest video game maker in the United States, Russell claims EA used his image in a “Tournament of Legends” featured on one of its NCAA basketball video games.    Russell seeks an injunction blocking any further sales of the videos and video games in question.  Additionally, he wants disgorgement of profits from both the games and videos along with other damages.  

Russell’s claim will likely be consolidated with a pending lawsuit brought by Ed O’Bannon, a former UCLA basketball standout (O’Bannon v. NAT’L Coll. Athletic Ass’n., 09-cv-01967, N.D. Cal.; appeal pending, 10-15387, 9th. Cir.).  O’Bannon’s suit alleges that the NCAA and EA have conspired to violate former student-athletes’ rights to profit from and control the use of their image. EA has denied any wrongdoing, relying on the constitutional right of freedom of speech under the First Amendment.  EA claims that freedom of speech under the First Amendment means it does not need permission to use any player’s likeness because the videos have sufficient creative elements that collectively express that they are more than depiction of any one athlete.  The NCAA has also denied any wrongdoing.  

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This week, the FDIC and SEC approved the Volcker Rule and released a draft for public comments.  Bank regulators will have to solidify the Rule in the coming months, as the Rule is set to take effect in July, 2012 – although banks would have three years to comply with the Rule. 

Part of the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Volcker Rule limits the type of investments that banks can make with their own money.  A result of the financial crisis, the Rule seeks to reign in the behavior that caused banks to fail in 2008.  The Rule is named after former Federal Reserve Chairman Paul Volcker, a man who criticized bank practices long before the financial crisis.  The Rule applies to banks that have government guarantees and may even impose limits on financial companies supervised by the Federal Reserve Board.  

The Volcker Rule places two big limitations on banks.  First, the Rule prohibits banks from owning or controlling hedge funds and private equity funds: a bank cannot own more than three percent of a hedge fund or private equity fund, and cannot invest more than three percent of its capital in such funds.  

Second, the Rule prohibits banks from engaging in proprietary trading.  Proprietary trading occurs when a bank makes trades for its own benefit, rather than for the benefit of a customer.  There are a few exceptions to this rule though, including trades of foreign currencies, commodities, and government bonds.  Additionally, banks can engage in proprietary trading if they are hedging while trading on behalf of a customer.  And banks may still act as market-makers and underwriters.      
The Rule is not without problems though.  Even its supporters claim note that the Rule may not be strict enough, and may contain loopholes.  Also, it can be difficult to draw a line between proprietary trades and trades made for customers.  

Wall Street is certainly not happy with the additional regulations.  Compliance will create new costs; the Rule requires banks to create internal compliance programs overseen by executives.  And Moody's noted that the Rule gives certain companies, like investment firms and offshore banks, a competitive advantage because they are not subject to the regulations.  

At almost 300 pages, the Volcker Rule will likely receive several public comments in the next few months, including some very loud ones from Wall Street.  

William F. Auther is a partner with an active trial practice in business litigation and Kelly M. McInroy is a law clerk in the Phoenix office of Bowman and Brooke LLP.  

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