Confidential settlements under fire in 13 states

Lawyers Weekly USA
Monday, April 30, 2001

An old argument has gained new traction in the wake of the Firestone tire scandal, as 13 states consider legislation that would ban confidential settlements in cases that compromise public safety.

The revitalized debate has been fueled by reports that Firestone secretly settled wrongful death suits for years while continuing to produce the tires that allegedly caused those fatalities. Heightened public awareness is galvanizing efforts to ban secret settlements in cases that involve defective products, environmental hazards or financial fraud -- a move that would give plaintiffs' lawyers an enormous advantage.

While no one expects all of these bills to pass this session, observers believe the momentum has shifted.

"There seems to be a sea change in how this issue is being addressed at the state level," says Joanne Doroshow of the Center for Justice & Democracy, which tracks "sunshine in litigation" statutes and court rules around the country.

Some states have had such legislation in place for years. Texas and Florida, for example, have strong statutes barring concealment of information related to public hazards.

The new legislative initiatives, many of them modeled after the Texas and Florida statutes, also vary from state to state, but the underlying principle is the same: to make it tougher for corporations to shield settlements from scrutiny.

For a copy of the complete article, contact CJ&D.

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