What Price Terror?

What if terrorists struck in South Florida? Say a terrorist cell simultaneously destroys cruise ships at the Port of Miami and Port Everglades, killing scores of people and injuring hundreds while scuttling ship operations for months. The terrorists either died during the suicide mission or escaped and there’s no way to trace the identity of the attack’s sponsors.

Unlike Sept. 11, Congress sets up no fund to pay the economic damages incurred by the victims of these attacks.

The question is, who would be liable? Who would the victims and their families sue? And how would you do it?

The Daily Business Review recently posed this hypothetical situation to some of South Florida’s top litigators at a seminar titled “Winning Litigation Strategies.” Their answers offered a roadmap for how lawyers might approach the task of deciding who would be liable in the event of such an attack, and how a team of plaintiff attorneys might go about collecting damages for victims and their families.

Analysts say the United States is ripe for another 9-11-style attack in the wake of the war in Iraq, and that the private and public sectors are now on notice that they must tighten security and protect their workplaces, employees and customers from terrorism.

Panelists at the seminar, held at the Hyatt Regency Miami, were: 

  • Andrew Hall of Hall David & Joseph in Miami.

  • Thomas K. Equels of Holtzman Equels in Miami.

  • Maxine Noel of Grazi & Gianino in Stuart.

  • Michael Haggard of Haggard Parks Haggard & Bologna in Miami.

  • Larry Stumpf of Black Srebnick Kornspan & Stumpf of Miami.

Some of the speakers provided general advice to lawyers on the approach small firms should undertake, while Hall offered specifics from his 11-year struggle to collect $25 million in frozen Iraqi assets for five clients who were detained and tortured by the Iraqi government.

Equels, who obtained a $44 million judgment against former Panamanian leader Manuel Noriega on behalf of the Republic of Panama, spoke of the importance of firm staffing.

“If you’re going to take on a big case, surround yourself with good people, bright people, people who will enhance your performance,” he said.

His other ingredient for success: Develop a litigation plan.

“When you take a case likes this in, you need to take some time to think through where this case is going to go, the natural progression of things,” he said.

Equels encourages those less experienced to partner with others with more experience.

“You don’t want to miss the opportunity to have a big recovery because you’re unwilling to hook up with somebody who has had experience in the problem area that is presenting itself,” he said. “Sharing a big pie is much better than not having anything at the end of the day.”

Other allies include lawyers with clients whose interests coincide with yours. “By working together you come up with a stronger, more cohesive plan, a plan that covers all the contingencies,” he said. “There’s an old biblical saying that one string can be broken but if you take one, two, three, four and braid them together, no man can break it.”

Litigators should also know who their adversaries are, said Equels —their economic depth, insurance reserves, lawyers and lawyers’ litigation techniques.

“As much as lawyers like to think they’re extremely discreet and their strategy is secret, the fact is we tend to be creatures of habit and litigators often do the same thing time after time after time,” he added.

Equels also addressed lawsuits that invoke the doctrine of sovereign immunity, governed by Chapter 768 of the Florida statutes, and cautioned lawyers to read the statute carefully and not get tripped up by technicalities. One of those technicalities: giving notice to the agency you’re suing as well as the state Department of Insurance by filing a letter outlining the claim and giving the agencies an opportunity to administratively adjust the claim.

“If you don’t do this,” cautioned Equels, “your suit can be thrown out. It doesn’t matter how meritorious it is.”

You must also serve the state attorney in the county where you’re filing suit as well as the Department of Insurance and the state agency involved. “If you’ve blown your timing deadline you could have a very serious problem with your client,” he said.

Equels recommends that before suing governmental agencies, lawyers make a checklist of all the statute requirements and check them off as they proceed. While Florida caps liability for governmental agencies at $100,000 per person, there is another option, Equels said: claims bills filed with the Legislature. To do so, you need to hire a lobbyist, and your claim must have political merit, he said.

Additionally, you are limited in grounds for suing the government. You can’t sue a government for its decisions, only for operational error or negligence. “It’s a subtle and very blurred distinction between what’s decision-making and what’s operational,” he said. “You need to think it through and there are cases you need to read before you sue cause you can invest a lot of time and effort only to be thrown out of court.”

Michael Haggard, whose firm won cases against the U.S. government for flight training deaths of two Air Force Academy cadets in Florida, urged lawyers to maintain credibility with jurors and judges by dropping frivolous claims and keeping demands within the reasons of jury verdict research. That’s because the defense will “push it” and try liability issues even when the case is clearly one of wrongful death.

Regarding the hypothetical situation, Haggard said he would try the case “seven days a week — especially against the private entities.” He said the case is not different from what he deals with every day in negligence security cases.

In Florida, said Haggard, there is a stream of cases stating that private property or business owners have a duty to reasonably protect their invitees from crimes. “It’s a great body of case law and it’s gotten better after the last couple of years,” he said.

One issue lawyers will encounter: Was the event foreseeable? This can be established by obtaining a crime grid to determine past crimes that have occurred at the ports. The foreseeability issue benefits plaintiffs because after Sept. 11, “everybody in America now knows this is on the horizon again.”

Lawyers should also obtain the bids the security companies submitted to the ports to see what they promised they could do, as well as their bids and histories at other ports. “I’ll bet in those bids they said they’re a pretty good security agency,” said Haggard. “Why did the Port of Miami hire them and for what purposes? They didn’t want the Miami Police Department, they wanted an expert in security.”

Haggard also urged lawyers to partner with allies. He related a case he had involving a woman who was sexually assaulted on the Miami Beach boardwalk. He chose to sue the security company instead of the city. As a result, the police officers cooperated fully, testifying on the company’s negligent history.

The cruise line could be a defendant in the hypothetical case, Haggard noted. “Carnival Cruise Lines invites a lot of people down to Miami to go on those ships,” he said. “They make a lot of money. They need to protect against these types of acts. Certainly they’re on heightened notice.”

Interestingly, Haggard added, the cruise line could be both plaintiff and defendant in the case.

The case would likely become multidistrict litigation, said Haggard, in which lawyers with multiple cases should try to get on the steering committee “so you wouldn’t be left in the dark.”

Much of your argument in these cases will hinge upon whether the event could have been prevented. One way to do this, said Haggard, is to create a color grid showing crimes that have occurred in the past, broken down by crime. Haggard did this with a hotel negligence case and the jury was suitably impressed when he displayed a grid blanketed with color dots. “It showed there was all this crime at the hotel and they weren’t doing anything about it,” he said.

Maxine Noel also emphasized the importance of studying the statute on sovereign immunity. Over the years, she has created a form letter that incorporates all the elements she feels need to be in a presuit notice. “Don’t let some stupid technicality blow your case and then you get to be sued,” she said. “You’re walking in a minefield.”

Addressing the issue of whether a small firm can handle a big case, Noel answered emphatically, yes. Her four-lawyer office is going up against Saturn and General Motors in a product liability case. The key, she said, is being “passionately involved.”

“If you’re not passionately involved, don’t do it.”

When the case walks in the door, Noel thinks trial, not settlement. “I tell my clients … if you’re not prepared to go into that courtroom and sit in that box and testify, tell me now because I’m not doing it.”

The success of a case, she feels, has less to do with evidence and more to do with whether the jury likes her client. “If they don’t like your client, they’re not going to give them money,” she said. “It’s as simple as that.”

The plaintiff attorney has the burden, she said — to be creative, to present a good case. All the defense attorney has to do is “pick it apart piece by piece, inconsistency by inconsistency, red herring, smokescreen, whatever.”

Plaintiff lawyers must “exorcise the poison” from jurors, Noel said. Jurors think lawyers are responsible for the ills of society — for driving doctors out of Florida, for driving up insurance rates. “We are the scum of the earth,” Noel said. “Shakespeare said kill all the lawyers and they’re still saying it. The McDonald’s case really hurt us.”

Lawyers should talk to jurors about their feelings about lawyers and caps, she said.

“Jurors say to me I think there should be a cap,” Noel said. “I say I agree with you. How about you decide the cap — why should anyone else decide the cap? You think you’re not able to discover for yourself how much money should be given here? You need someone to tell you that arbitrarily? They like that. They’re not going to like the fact that they’re not capable.”

Lawyers should know the memorandum of law on jury selection and be willing to challenge judges who may not, Noel said. She told of a judge in Martin County who accused her of trying harder to disqualify than to seat a jury panel. She persevered and wound up winning the highest verdict ever in that county, $665,000, for a medical malpractice case.

“You gotta get that jury to be yours before opening, during jury selection,” she said. “It has to be you and me, us.”

Stumpf’s advice: Start at the end of your case — jury instructions — and work backward. “That’s going to tell me what are the elements of the claims, and that’s going to tell me what facts I’m going to need and how I’m going to structure my discovery plan,” he said.

Stumpf, who helped represent San Francisco bond dealer Calvin Grigsby in the 1999 Port of Miami corruption case, also addressed the question of how a small firm can handle a big case: by limiting their cases and by forming a virtual law firm with other lawyers and dividing up tasks.

Another technique Stumpf employs is developing a theme early in the case. “It’s almost like the title of a TV program — the case of the dishonest broker,” he said. “If you stick to your theme that you develop early on in the litigation, it will help you plan your case and plan what discovery you really need.”

Andrew Hall focused on how to sue foreign governments, an issue of which he has personal experience. Hall struck gold in April after helping secure $58 million in Iraqi frozen accounts for five clients, as well as two other plaintiffs. It was a long, 11-year road for Hall, who hired two separate teams of lobbyists to get laws passed in Congress and then get two presidents to sign the orders into laws unfreezing the assets. 
One of those clients was Chad Hall (no relation). Hall was responsible for ridding Kuwait of munitions after the Gulf War when he was kidnapped at gunpoint, taken across the Iraqi border and tortured. He returned a broken man, said Hall, who got a call from a lawyer in Houston asking him if he wanted to partner representing Hall.

Hall’s team filed suit, began researching other cases and found there were hardly any. One case with some similarities to Hall’s involved an American who sued Germany after he was wrongfully detained in a concentration camp during World War II. But in 1995 and 1996, Hall’s case got a boost following several events, starting with Oklahoma City. “It heightened the sense of vulnerability,” he said, “and that found its way into Congress.”

Also in 1995, American Alisa Flatow was killed in a bombing in Israel and her family hired a lobbyist after complaining to reporters they had no legal remedy to gain compensation.

But most significant event was the passage of the Terrorism Act of 1996. That statute allowed plaintiffs to sue governments identified by the State Department as sponsors of terrorism. The countries on the list are North Korea, Syria, Sudan, Iraq, Iran, Libya and Cuba.

The law came on the heels of the Cuban government’s shoot-down of the Brothers to the Rescue planes in 1996. President Clinton publicly called the incident an outrage and asked Congress to change the Foreign Sovereign Immunities Act. Hall got a call asking if Chad Hall would agree to testify before Congress.

So Andrew Hall found himself “in the lobbying business;” he was part of a group that crafted Section 7 of the foreign sovereign immunities act that created the terrorism exception. He immediately filed a lawsuit on behalf of Hall; a dozen followed close behind, including one by former Associated Press journalist Terry Anderson.

The foreign nations sued wasted no time challenging the jurisdiction.

“They came in and basically said, ‘Who are you in American court to tell us that we as a sovereign nation are now governed by your courts as to an event that occurred in our nation?’ “

The trial courts sided with Hall.

Lawyers tackling highly publicized terrorism cases get lots of help, Hall said, as the government and press have often uncovered reams of documents. However, the government will also be the prime adversary. 
“The State Department does not have an American desk, and that’s not an accident,” he said. “They always feel like they represent the foreign nation. And talk about a well-heeled opponent.”

Jurisdiction in such cases is not a problem, as the courts have said that a foreign state is not entitled to due process. The logic behind the decision, according to Hall: “Should you have to give notice to a foreign nation before attacking it? Can you imagine after attacking them having a hearing as to how much we owe them?”

To sue a foreign government for terrorism, lawyers must prove their clients were tortured, said Hall. The definition of torture is very clear, and does not just mean living in a third world jail cell. “It’s not hard to get there, you just have to remember to ask the right questions,” he said.

Once the trial begins, lawyers should waste no time letting the client and his spouse tell their stories — “get to the heart of it,” said Hall.

The biggest problem, however, is collection. “We thought we were very clever when we got the Foreign Sovereign Immunities Act amended, but we kind of forgot something,” said Hall. “How to get paid. We just wanted to get to court.”

He later hired a different team of “good” lobbyists and got a new bill filed, but Clinton killed it on his way out of office. “We were pissed,” said Hall. So Hall and his lobbyists returned to Congress last year, which fixed the law to eliminate a waiver exempting a private company operating out of a terrorist country.

Hall and others are still trying to fix an exemption that currently exists for terrorist organizations like al Qaeda. He plans to go to court to test the law by filing suit against the group on behalf of family members of victims of the USS Cole bombing.

“You’re going to have to have good evidence at your jurisdictional hearing that people who contributed to the terrorist cell knew it was a terrorist cell and they were about to engage in terrorist acts,” he said. “The problem is the way the money flows, typically, is it flows into a charitable organization and it’s watered through two or three different layers of charitable organizations and then on to al Qaeda.””

Finally, Hall recommended that lawyers invoke the Uniform Fraudulent Transfer Act, whereby your client is a creditor. Hall used the law in a Libyan case and is awaiting a ruling. He did so because Libya is currently negotiating with the State Department to improve relations with the United States. Hall is concerned Libyan assets can be unfrozen any time.

“You need to be anticipating the political moves the State Department will be doing, and your final difficulty will always be the State Department,” he said. “If you can survive that, you will be successful.”