Risk Update

Judicial Conflicts & Disqualifications — Recusal, Reversal, Review

BREAKING: Endo Wins Reversal Of Opioid Default, Judge DQ’d” —

  • “A Tennessee appeals court on Wednesday erased a trial judge’s stunning decision finding Endo Pharmaceuticals liable for opioid abuse because of discovery misconduct, calling the sanction faulty because of pending efforts to disqualify the judge for bias against the drugmaker.”
  • “In a seven-page opinion, the Tennessee Court of Appeals vacated the default judgment against Endo after finding that Circuit Court Judge Jonathan Lee Young appeared ‘antagonistic to the interests of those in the pharmaceutical industry’ when — in Facebook posts and an interview with Law360 — he discussed opioid litigation.”
  • “In the interview, Judge Young called Endo’s failure to produce important documents during opioid litigation ‘the worst case of document hiding that I’ve ever seen,’ adding that ‘it was like a plot out of a John Grisham movie.'”
  • “‘To promote confidence in our judiciary, we conclude that the trial judge erred in refusing to recuse himself from the case,’ the court wrote.”
    “Because Judge Young should have bowed out, his Feb. 28 order granting sanctions, including default liability, must be nullified, the court said.”

Federal judge finds no improper influence on case from colleague’s financial conflict” —

  • “A federal judge has found his colleague’s undisclosed financial conflict of interest had no influence over the ruling in a debt collection lawsuit against Wells Fargo.”
  • “U.S. District Court Senior Judge John L. Kane, without prompting from any party to the lawsuit, issued a decision on Friday following his independent review of Dennis Obduskey’s 2015 complaint against Wells Fargo and the McCarthy Holthus law firm. Obduskey alleged the defendants violated the the Fair Debt Collection Practices Act while carrying out foreclosure proceedings on his home.”
  • “Although Obduskey’s lawsuit reached the U.S. Court of Appeals for the 10th Circuit and also the U.S. Supreme Court, Kane took the extraordinary step of initiating his own audit in response to revelations last fall that the original judge in the case, R. Brooke Jackson, was one of 131 federal judges nationwide who handled civil lawsuits despite owning a financial stake in one of the corporate parties to a case.”
  • “The Wall Street Journal initially broke the news of the conflicts of interest, noting at least 36 instances in which Jackson failed to recuse himself as the law requires. Jackson, a 2011 appointee of the Obama administration, undertook his own review of his cases and discovered additional conflicts, which Colorado Politics in turn examined this year.”
  • “Federal law governing recusal indicates that judges must disqualify themselves if they or their spouses have a financial stake in a case. Judges also have a duty under the law to reasonably inform themselves about their financial interests. While apologetic for his failure to conduct himself accordingly, Jackson also explained that he remained in the dark about his finances and that his wife prepared the financial disclosure reports.”