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Courts Are Stopping Trump's Cuts to Funding · Bloomberg Law

0:02
Speaker 1: This is Bloomberg Law with June Grosseol from Bloomberg Radio.
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Speaker 2: Time after time, President Trump has tried to freeze federal
0:12
Speaker 2: funding as a cudgel against political opponents and programs he
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Speaker 2: considers woke, from freezing ten billion dollars for childcare and
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Speaker 2: aid for low income families to freezing five billion dollars
0:26
Speaker 2: for a Federal Highway Administration program to build infrastructure for
0:31
Speaker 2: electric vehicle charging. But also, time after time, federal courts
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Speaker 2: have stepped in to lift those funding freezes. In fact,
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Speaker 2: in more than half of the one hundred sixty seven
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Speaker 2: spending fights reviewed by Bloomberg News, joining me is the
0:48
Speaker 2: reporter who crunched the numbers, Bloomberg Legal reporter Zoe Tillman. Zoe,
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Speaker 2: for those who may not know, explain President Trump's use
0:58
Speaker 2: of federal funding freezes against people or groups or programs
1:03
Speaker 2: that he disagrees with.
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Speaker 3: So, I mean from day one of the administration, and
1:08
Speaker 3: really before day one, there was this big push where
1:12
Speaker 3: Elon Musk was the face of this Department of Government
1:15
Speaker 3: efficiency initiative.
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Speaker 1: They're going to cut spending, They're going to cut the
1:19
Speaker 1: federal workforce.
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Speaker 3: This was really a message from the incoming administration from
1:25
Speaker 3: the very beginning, and you know, right away it was
1:29
Speaker 3: a slash and burn approach. Grants were cut, executive orders
1:34
Speaker 3: were signed right from the start saying, you know, no
1:37
Speaker 3: more federal money is going to go to things that
1:41
Speaker 3: this administration doesn't support. So nothing that is DEI related
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Speaker 3: in any way, nothing that relates to you know, the
1:49
Speaker 3: term they used as gender ideology, but really has to
1:52
Speaker 3: do with programs that relate or involve transgender individuals, things
1:57
Speaker 3: related to climate change, really just using the flow of
2:01
Speaker 3: federal dollars to achieve any number of policy objectives. Later on,
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Speaker 3: we saw a number of actions related to immigration, including
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Speaker 3: efforts to condition grants on compliance with immigration enforcement, even
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Speaker 3: for grants that weren't directly related to immigration. So this
2:21
Speaker 3: has been just a big priority for this administration from
2:25
Speaker 3: day one and has been, you know, predictably met with
2:29
Speaker 3: legal challenges from day one.
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Speaker 2: So you reviewed one hundred and sixty seven fights over spending,
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Speaker 2: tell us a little bit more about them.
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Speaker 3: Yeah, so I should say, I mean taking a few
2:40
Speaker 3: more steps back. You know, we've been tracking every lawsuit
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Speaker 3: against administration, you know, from day one to the best
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Speaker 3: of our ability with an eye to sort of looking
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Speaker 3: at what the role of the courts will be and
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Speaker 3: has been in you know, our government.
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Speaker 1: Are they serving as a check?
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Speaker 3: Is there an adversarial rellylationship with the executive branch At
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Speaker 3: a moment when Congress has sort of removed itself in
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Speaker 3: many ways from the policy make sphere and so much
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Speaker 3: is coming out through executive action, you know, what is
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Speaker 3: the dynamic with courts? So with that in mind, at
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Speaker 3: the one year mark, we decided to drill down and
3:18
Speaker 3: look at funding to see just where the money is
3:21
Speaker 3: going or not and what role the courts have played. So,
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Speaker 3: you know, there have been cases about really any realm
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Speaker 3: of federal spending you could think of, you know, money
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Speaker 3: going to universities for medical research, scientific research, transportation, infrastructure grants, agriculture, arts, media, humanities.
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Speaker 3: Really every aspect of federal spending has landed in court
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Speaker 3: at this point.
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Speaker 2: Tell us about some of the cases where judges lifted freezes.
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Speaker 2: In January alone.
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Speaker 3: There was an instance of a specific set of grants
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Speaker 3: that I went to a pediatricians organization, a national.
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Speaker 1: Group of pediatric doctors.
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Speaker 3: They had had twelve million dollars in grants cut off
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Speaker 3: a number of medical groups have you found themselves in
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Speaker 3: an adversarial position with this administration on everything from vaccines
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Speaker 3: to care for transgender children, and the court in this instance,
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Speaker 3: a DC federal judge found that the way the government
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Speaker 3: had gone about, you know, suddenly cutting off these grants
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Speaker 3: that had been approved, that that was likely unlawful and
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Speaker 3: ordered them to resume paying them out. So that was
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Speaker 3: an instance of sort of a direct stream of money
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Speaker 3: to a particular organization. In another set of cases, there
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Speaker 3: was a trio of appeals before the first Circuit involving
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Speaker 3: a cut to the rate that research institutions are reimbursed
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Speaker 3: for what's commonly known as indirect costs, things like overhead facilities,
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Speaker 3: you know, not the cost of the research, but all
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Speaker 3: the money spent to support that research, you know, around it.
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Speaker 3: And the first circuit upheld lower court judge who had
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Speaker 3: enjoined the way the administration had gone about doing that,
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Speaker 3: and that was, you know, costs that the government itself
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Speaker 3: had estimated.
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Speaker 1: You know, we're worth billions of dollars of reinforcements to
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Speaker 1: research institutions.
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Speaker 3: So it's really run the gamut, and you know, we've
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Speaker 3: just continued to see orders come down that you know,
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Speaker 3: are often preliminary, so I should say we haven't reached
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Speaker 3: the final judgment phase in most cases we're talking about
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Speaker 3: temporary restraining orders. We're talking about preliminary injunctions. Some cases
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Speaker 3: are nationwide, many or not, especially after the Supreme Court
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Speaker 3: last year made a big step to rein in nationwide
5:48
Speaker 3: or so called nationwide or universal injunctions. So some of
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Speaker 3: these orders have been limited to the states that have
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Speaker 3: sued the organizations that have sued, although I should say,
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Speaker 3: you know, sometimes there are membership groups that involve hundreds
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Speaker 3: of individual nonprofit members or organizations, so you know, sometimes
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Speaker 3: the relief is limited. But advocates in the course of
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Speaker 3: doing this have said, you know, if we didn't sue,
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Speaker 3: we would get nothing, so they see every win as
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Speaker 3: valuable at this point.
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Speaker 2: And how often did judges halt the Trump administration's funding cuts.
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Speaker 3: So as of when you know, I sort of cut
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Speaker 3: off the data collection for this project or data collection
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Speaker 3: has continued, but for this project, as of mid January,
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Speaker 3: across the one hundred and sixty seven cases that you
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Speaker 3: know we looked at dockets, there were more orders in place,
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Speaker 3: halting in fuller in part that contested actions in more
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Speaker 3: than half, just over half, so you know, more often
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Speaker 3: than not, there continued to be court orders either requiring
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Speaker 3: money to go out the door. In some cases it
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Speaker 3: wasn't money going out the door, but it was just
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Speaker 3: preserving the funding it issue or access to that funding,
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Speaker 3: making sure it couldn't be redistributed amid the litigation. Other
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Speaker 3: cases there are orders lifting I mentioned earlier sort of
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Speaker 3: conditions on grants, lifting those new conditions. So that doesn't
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Speaker 3: guarantee that everyone who's sued will get the money, but
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Speaker 3: it means they don't have to satisfy those new and
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Speaker 3: what they contend are you know, improperly crafted conditions to
7:28
Speaker 3: at least apply for money. So that's that's where things
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Speaker 3: are as of middle end of last month.
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Speaker 2: Does the government almost always appeal these lower court orders?
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Speaker 3: Not always often, you know. I think the one trend
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Speaker 3: that we've seen is in cases that involve very straightforward
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Speaker 3: you know, you owe me money, you haven't paid it,
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Speaker 3: and I want that money back, they are more likely
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Speaker 3: to appeal and they are more likely to seek emergency
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Speaker 3: relief from an appeals court in case that involve conditions
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Speaker 3: where there's less of a time sensitivity involved and you know,
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Speaker 3: it's not as if a judge has literally turned the
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Speaker 3: spigot back on and money has to come out. They
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Speaker 3: are appealing some of those, but not always pursuing, you know,
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Speaker 3: this emergency relief, and then in some cases they're not appealing,
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Speaker 3: and you know, they're letting preliminary injunctions or temporary restraining
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Speaker 3: orders stay on the books as the litigation plays out.
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Speaker 3: You know, it's in the first year, there was so
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Speaker 3: much activity on sort of emergency dockets, not just for
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Speaker 3: the Supreme Court, but up and down the judicial chain
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Speaker 3: that so many things happened on a preliminary basis, and
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Speaker 3: in the moment, we and you know, we including me
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Speaker 3: and our coverage would often characterize a temporary or preliminary
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Speaker 3: injunction as a win or a loss for one side
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Speaker 3: or the other. But those are not final orders, and
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Speaker 3: you know, those orders will.
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Speaker 1: Stay on the docket.
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Speaker 3: But then later on courts might take a different position
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Speaker 3: once they've had a full airing of the evidence and arguments.
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Speaker 3: So I think it's worth stressing that many of these cases,
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Speaker 3: even when we've had sort of quote unquote wins and
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Speaker 3: losses early on, they keep going, and you know, there's
9:15
Speaker 3: more action potentially down the pike.
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Speaker 2: What happens to the funds. Let's say a lower court says,
9:22
Speaker 2: you know, we're lifting this freeze and then the government appeals.
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Speaker 2: Are the funds paid out in the meantime they are?
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Speaker 3: I mean, it depends on how the order is structured.
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Speaker 3: So we've had cases where there's an injunction. I know
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Speaker 3: from talking to grantees that you know they've gotten the money.
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Speaker 3: It might not always be a lot of money, but
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Speaker 3: they've gotten money even with an appeal. You know, in
9:45
Speaker 3: cases where the government gets a stay of a lower
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Speaker 3: court injunction, than the government doesn't have to do anything
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Speaker 3: while the.
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Speaker 1: Case goes forward.
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Speaker 3: There have been some issues with compliance, not to the
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Speaker 3: extent that we've seen more recently in the immigration context,
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Speaker 3: where you know, there have been a number of judicial
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Speaker 3: rulings that have gotten a lot of understandably attention for saying,
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Speaker 3: you know, there's defiance by ice when we've ordered release,
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Speaker 3: where we've ordered bond hearings. It hasn't reached that level
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Speaker 3: in funding cases. What I've heard in reporting the story
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Speaker 3: out is that for the most part, states and nonprofits
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Speaker 3: feel that the government is mostly complying when ordered to
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Speaker 3: keep paying out or accept applications, you know, what have you.
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Speaker 3: But it has not always been smooth sailing, even after
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Speaker 3: an injunction or temporary restraining order comes down.
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Speaker 2: Coming up next on the Bloomberg Law Show, I'll continue
10:40
Speaker 2: this conversation with Bloomberg Legal reporter Zoe Tillman, will take
10:44
Speaker 2: a look at what the Supreme Court has done when
10:46
Speaker 2: these funding freezes have reached the justices. I'm June Grosso
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Speaker 2: and you're listening to Bloomberg. President Donald Trump's expansive efforts
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Speaker 2: to use federal funding as a cudgel against political opponents
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Speaker 2: and programs he considers woke remain mired in court more
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Speaker 2: than a year since his return to the White House.
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Speaker 2: By the start of twenty twenty six, federal judges had
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Speaker 2: halted his funding cuts and limits in more than half
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Speaker 2: of one hundred and sixty seven spending fights reviewed by
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Speaker 2: Bloomberg News. The rulings against the government underscore how the
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Speaker 2: legal system has persisted as a roadblock, or at the
11:26
Speaker 2: very least, a speed bump, to Trump's second term agenda.
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Speaker 2: I've been talking to Bloomberg Legal reporter Zoe Tillman, so
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Speaker 2: some of these fights have reached the Supreme Court. Tell
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Speaker 2: us about how the Supreme Court has ruled generally.
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Speaker 3: Yeah, so what the Supreme Court has said, and it's
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Speaker 3: really two cases that pushed this newer jurisprudence to evolve.
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Speaker 3: What the Court has said is if you've got to
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Speaker 3: basically a breach of contract claim and you're coming in
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Speaker 3: and saying this grant was approved, I was supposed to
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Speaker 3: get a million dollar for my project and they terminated it,
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Speaker 3: and I should get this money. Or I already spent
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Speaker 3: money and submitted for reimbursement and I didn't get the money.
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Speaker 3: The Court has said those really belong in the US
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Speaker 3: Court of Federal Claims and not a US district court.
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Speaker 3: The US Court of Federal Claims is a specialized federal court.
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Speaker 3: Its judges are not They don't get lifetime appointments in
12:23
Speaker 3: the same vein as US district courts.
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Speaker 1: It's a more limited forum.
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Speaker 3: You can't get, you know, preliminary injunctions or relief turning
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Speaker 3: money back on.
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Speaker 1: It's you have to play it out to the end.
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Speaker 3: And you know, sources I talked to you for this
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Speaker 3: said if you're a small nonprofit, you can't spend a
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Speaker 3: year waiting for money.
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Speaker 1: It's really make or break.
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Speaker 3: You need that preliminary or temporary order from a court
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Speaker 3: to preserve status quo while you litigate. So moving these
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Speaker 3: types of funding cases over to federal claims, which is
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Speaker 3: what the Supreme Court said needs to happen, is considered
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Speaker 3: a big win for the government, and it you know,
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Speaker 3: knocks out certain types of cases over funding cuts. But critically,
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Speaker 3: these cases didn't rule out all funding fights from US
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Speaker 3: district courts. There are constitutional claims even if they involve
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Speaker 3: funding terminations. If it's purely a you know, you retaliated
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Speaker 3: against me for exercising my First Amendment right and the
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Speaker 3: relief involves getting the money back, you know, that is
13:25
Speaker 3: still fair game, or at least you know, the court
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Speaker 3: didn't say you can't pursue those claims. Issues with the
13:32
Speaker 3: conditions on funding, those are still fair game to pursue.
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Speaker 3: And so, you know, advocates that are opposed to what
13:41
Speaker 3: the government is doing say that it didn't help to.
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Speaker 1: Have these Supreme Court orders come down.
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Speaker 3: But that they didn't knock out all funding fights, and
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Speaker 3: judges have certainly not felt that they can't issue, you know,
13:55
Speaker 3: more relief against the government in light of what the
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Speaker 3: justices that and I should say, you know, the Supreme
14:02
Speaker 3: Court orders came on the emergency or so called shadow docket,
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Speaker 3: so they too were preliminary and not very fulsome so
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Speaker 3: you know, I quote one judge in the story who
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Speaker 3: had an order that said, you know, they felt like
14:14
Speaker 3: their funding case fell in a gray area of what
14:17
Speaker 3: Supreme Court had said, and you know, barring a more
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Speaker 3: fully aired judgment articulating all the ways that funding cases
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Speaker 3: can be litigated or not in district courts.
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Speaker 1: This judge said, I see room for me to act. Here.
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Speaker 2: Is there a number for how much money, how much
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Speaker 2: in funding the government has frozen?
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Speaker 3: We don't have a complete number, at least not one
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Speaker 3: that everyone agrees on. We know that the Department of
14:48
Speaker 3: Government Efficiency, which was you know, the Elon Musk driven project,
14:52
Speaker 3: even though Elon Musk is no longer part of the administration,
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Speaker 3: DOAGE said that they saved two hundred and fifteen billion
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Speaker 3: dollars and that savings covered you know, terminated spending streams.
15:05
Speaker 3: It covered government employees salaries or the cost of running
15:09
Speaker 3: agencies that were trimmed or shut down. There's also some
15:12
Speaker 3: nuance to that number where Bloomberg reported, you know that
15:16
Speaker 3: spending still went up.
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Speaker 1: In other ways over the past fiscal years.
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Speaker 3: So that you know, might cancel out whatever those savings were.
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Speaker 3: But that said, you know, we have this number of
15:26
Speaker 3: like two hundred and fifteen billion. We know that states,
15:29
Speaker 3: state a g offices, state attorney general offices have offered
15:33
Speaker 3: their own estimates of money that.
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Speaker 1: They say they've protected.
15:36
Speaker 3: Will usually say like they've protected or secured for their residence,
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Speaker 3: and that can mean both, you know, literal money going
15:45
Speaker 3: back out the door to grantees. It can mean the
15:48
Speaker 3: conditions on funding streams. It can mean you know, they've
15:52
Speaker 3: preserved access to a pool of money even if it's
15:55
Speaker 3: not clear who will get it in the end. But
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Speaker 3: they've offered up their own estimates, sometimes in the billions
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Speaker 3: of dollars that they've you know, won in litigation.
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Speaker 1: And it's very fluid.
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Speaker 3: You know, in one day last month, there was an
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Speaker 3: order lifting a freeze on something with ten billion dollars
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Speaker 3: in aid funding for low income families. So you know,
16:17
Speaker 3: in an instant the numbers can fluctuate by the billions.
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Speaker 3: As far as what's at stake in these legal fights.
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Speaker 2: And these funding freezes are continuing. Recently, Trump tried to
16:29
Speaker 2: freeze the sixteen billion dollar Gateway rail tunnel between New
16:34
Speaker 2: York and New Jersey. And that's been unfolding rapidly.
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Speaker 3: That's right, I mean, speaking of fluid that case, I
16:41
Speaker 3: think it's been a week a week and a half,
16:43
Speaker 3: and forebody gone through so many iterations where I think
16:48
Speaker 3: it was sixteen billion that was frozen. A judge ordered
16:52
Speaker 3: it unfrozen for this massive, you know, rail tunnel project
16:56
Speaker 3: between New Jersey and New York. The government appealed, and
17:00
Speaker 3: then the district judge sort of suspended her own order
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Speaker 3: for a few days to give the government a chance
17:08
Speaker 3: to go to the appeals court to get a longer
17:11
Speaker 3: term pause on that injunction. The States then went to
17:15
Speaker 3: the district judge and said, can you lift your own
17:18
Speaker 3: pause of your own order lifting the freeze. So it's
17:22
Speaker 3: one of those cases where, you know, as I said earlier,
17:25
Speaker 3: when it's about money going out the door, things have
17:29
Speaker 3: moved often very quickly in a way that if we
17:32
Speaker 3: were just talking about, you know, conditions on accessing that
17:36
Speaker 3: money long term, it likely wouldn't have unfolded at such
17:40
Speaker 3: a rapid clip.
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Speaker 2: You're anticipating I'm anticipating too. We're all anticipating that there
17:46
Speaker 2: are going to be a lot more funding freezes connected
17:50
Speaker 2: with Trump's immigration crackdown. In his railing against sanctuary cities
17:56
Speaker 2: and states, you.
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Speaker 1: Know, it's a big question mark.
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Speaker 3: They have not had success defending these types of funding
18:04
Speaker 3: decisions tied to you know, whether a city or state
18:08
Speaker 3: is a so called sanctuary fiction. There's an order still
18:11
Speaker 3: an effect from a San Francisco federal judge last year
18:15
Speaker 3: that's being appealed at the moment, but there's alredient order
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Speaker 3: finding a similar effort was unlawful. So the President more
18:22
Speaker 3: recently had again said that they would pull funding from
18:26
Speaker 3: these types of jurisdictions that they feel are failing to
18:30
Speaker 3: be as cooperative as they would.
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Speaker 1: Like on immigration enforcement.
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Speaker 3: And you know, we as part of this story talked
18:37
Speaker 3: with municipal services loving the Seattle City Attorney's office, which
18:43
Speaker 3: was part of the earlier sanctuary cities fight, and the
18:46
Speaker 3: message very broadly, not addressing specific litigation, but broadly was
18:52
Speaker 3: if there's grounds to sue, you know, they're ready to
18:55
Speaker 3: sue if something is threatening. They're funding many that they
18:58
Speaker 3: need for their cipal services. They're ready and able and
19:03
Speaker 3: prepared to go back to court as needed.
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Speaker 2: And I'm sure you'll be looking at that lawsuit if
19:09
Speaker 2: they do. Thanks so much, Zoe, great research. That's Bloomberg
19:13
Speaker 2: Legal reporter Zoe Tillman. Uber's facing some three thousand cases
19:19
Speaker 2: from around the country over passengers sexual assault claims. Last week,
19:24
Speaker 2: and Arizona jury found the ride sharing giant libel for
19:28
Speaker 2: not preventing an alleged sexual assault of a passenger by
19:32
Speaker 2: a driver, returning an eight and a half million dollar
19:36
Speaker 2: verdict for the passenger. The jurors found that the driver
19:39
Speaker 2: was acting as an apparent agent of Uber. However, they
19:43
Speaker 2: rejected claims that the ride share company itself acted negligently
19:48
Speaker 2: in its safety standards or designed a deceptive product. Now
19:52
Speaker 2: jurors came to a different result in a similar case
19:55
Speaker 2: in California State court last year. Uber says it's going
19:59
Speaker 2: to to appeal the Arizona verdict. But are these Bellweather
20:03
Speaker 2: cases likely to lead to a global settlement. My guest
20:07
Speaker 2: is Michael Green, a tourt law professor at Washington University
20:11
Speaker 2: School of Law. Uber has been fighting sexual assault claims
20:16
Speaker 2: for a decade, and the argument is that the company
20:22
Speaker 2: can't be blamed for the misconduct of its drivers, that
20:26
Speaker 2: there are contractors rather than employees. Has that been working
20:30
Speaker 2: until now?
20:32
Speaker 4: Just the basics here is that Uber can be liable
20:36
Speaker 4: in two respects. One is, if Uber acts wrongfully negligently
20:43
Speaker 4: on its own. Suppose Uber hires a known sexual offender
20:49
Speaker 4: to drive cars. In that case, we would say, Uber,
20:54
Speaker 4: you're negligent and you are subject to liability. The second basis,
20:59
Speaker 4: and this is what you reverting to, is employers can
21:03
Speaker 4: be vicariously liable for the torts of their employees. Okay,
21:10
Speaker 4: and that's where the Dean verdict was based. Uber says
21:17
Speaker 4: two things. One is, these drivers are not our employees.
21:23
Speaker 4: They are independent contractors. And the law is that a
21:27
Speaker 4: person who hires an independent contractor is not normally vicariously
21:32
Speaker 4: liable for that independent contractor's towards. And then secondly, it says, alternatively,
21:40
Speaker 4: even if the driver is our employee, we are not
21:45
Speaker 4: vicariously liable when an employee goes off and does things
21:50
Speaker 4: that are not for our benefit, that goes off on
21:54
Speaker 4: a personal detour and frolic. Well, almost all of these
22:00
Speaker 4: sexual assaults, virtually all of them, are not for the
22:04
Speaker 4: benefit of Uber. They are personal whatever they are by
22:10
Speaker 4: the drivers. So Uber really has two claims with regard
22:16
Speaker 4: to why it's not vicariously libel tell us what.
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Speaker 2: The jury found in the case in Arizona.
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Speaker 4: So that's the Dan case. And interestingly, what the jury
22:29
Speaker 4: found was that Uber was not negligent, So they didn't
22:35
Speaker 4: find anything that Uber did wrong vis a vis protecting
22:40
Speaker 4: its passengers from sexual assaults. But what they did find
22:46
Speaker 4: was that Uber was vicariously liable for its driver based
22:53
Speaker 4: on a subtle doctrine that exists in Arizona but is
22:59
Speaker 4: not widespread across the states, and that would not apply,
23:03
Speaker 4: for example, in the next case that Judge Bryer is
23:06
Speaker 4: planning to try, which is in North Carolina. That is,
23:11
Speaker 4: if we had the law of North Carolina applied in
23:14
Speaker 4: the Dean case, the planeff would not have succeeded on
23:18
Speaker 4: vicarious liability.
23:20
Speaker 2: The jury award of the eight and a half million
23:23
Speaker 2: was substantial, but it was far below the twenty four
23:26
Speaker 2: million she'd ask for for compensatory damages for her past
23:31
Speaker 2: and future sufferings, and she asked for one hundred and
23:33
Speaker 2: twenty million impunitive damages, and the jury awarded no punitive damages.
23:38
Speaker 2: So what do you make of the actual amount awarded?
23:44
Speaker 4: Well, first of all, I don't pay any attention to
23:46
Speaker 4: what planeiffs seek. They can seek the moon, and there's
23:51
Speaker 4: no cost to them seeking the moon, right, So, plainiff's
23:55
Speaker 4: lawyers typically will ask for lots and lots of in
23:58
Speaker 4: the hope that somehow that will stick with the jury.
24:02
Speaker 4: Often it does not, and the Dean case is an
24:06
Speaker 4: example where that was the case. I'm not surprised that
24:10
Speaker 4: they did not award punitive damages given their finding that
24:17
Speaker 4: Uber did nothing wrong. That is, they found Uber did
24:20
Speaker 4: not act negligently. It's very difficult to get punitive damages
24:25
Speaker 4: based on vicarious liability, which was the basis for liability
24:29
Speaker 4: and Dean. You need really bad behavior more even than
24:37
Speaker 4: acting unreasonably to get punitive damages. It commits a jury
24:43
Speaker 4: that this is really something heinous that deserves punitive damages.
24:47
Speaker 4: So I'm not surprised there were no punitive damages. Now
24:50
Speaker 4: that's not to say that in another case, the evidence
24:55
Speaker 4: about Uber's bad behavior might not be stronger and might
25:00
Speaker 4: not influence a jury to think, wow, or what Uber
25:05
Speaker 4: did here was unconscionable, and I think that would probably
25:09
Speaker 4: be much stronger for cases that occurred later rather than
25:16
Speaker 4: back in the mid twenty tens, particularly the case in California.
25:22
Speaker 2: The jury came to a different verdict in the case
25:24
Speaker 2: in California, So tell us about that.
25:27
Speaker 4: That was a case in state court in California, not
25:31
Speaker 4: part of this federal multi district litigation. And in that case, interestingly,
25:36
Speaker 4: the jury found that Uber was negligent for its own conduct,
25:42
Speaker 4: but they also found another element of course of a
25:46
Speaker 4: tort is not just that the defendant acted wrongfully, but
25:51
Speaker 4: that that wrongful conduct caused the plane off's harm. And
25:56
Speaker 4: what the jury found in that case was that Uber's
26:00
Speaker 4: negligence was not a cause of the plainiff's harm. That
26:06
Speaker 4: means that the jury felt that even if Uber had
26:09
Speaker 4: done better, the planeff in that case would still have
26:13
Speaker 4: suffered the assault that she suffered.
26:16
Speaker 2: Is there a way to reconcile those two verdicts? I mean,
26:20
Speaker 2: is it the facts of each of the cases are different.
26:23
Speaker 2: Is it the law is different in Arizona and California?
26:28
Speaker 2: Or is it just two juries looking at the same
26:30
Speaker 2: thing and saying different things.
26:33
Speaker 4: Well, of course we don't know what evidence was introduced
26:36
Speaker 4: in those two cases, and whether it was the same
26:40
Speaker 4: or it very That could very well be the case,
26:44
Speaker 4: but it could also be the case that juries simply
26:48
Speaker 4: respond to evidence differently. Earlier in my career, I was
26:53
Speaker 4: looking at a very interesting trial that was conducted by
26:58
Speaker 4: Judge Robert Parker of the Eastern District of Texas. At
27:03
Speaker 4: the time, his docket was just flooded with asbestos cases
27:08
Speaker 4: and he was looking for a way to try and
27:10
Speaker 4: handle what was a Sissapian task. The more he resolved,
27:17
Speaker 4: the bigger the pile god. And so what Judge Parker
27:21
Speaker 4: did was to have a trial of five cases, five
27:26
Speaker 4: asbestos cases, in the same courtroom before five different judges.
27:32
Speaker 4: The evidence was the same in those five cases, the juries.
27:37
Speaker 4: Five juris heard the same evidence for each of what
27:44
Speaker 4: was their case, and then they rendered verdicts, and Judge
27:48
Speaker 4: Parker gave me access to those verdict forms, and it
27:51
Speaker 4: was remarkable how on the difficult issues, the difficult issues
27:57
Speaker 4: the jury split and did not fly consist. I've taken
28:02
Speaker 4: that as a pretty good evidence of the way in
28:07
Speaker 4: which juries can come to different outcomes, and that's part
28:12
Speaker 4: of the purpose of these Bellwether trials that Judge Bryar
28:16
Speaker 4: is conducting to see how a variety of juries will
28:21
Speaker 4: react to the evidence in these cases.
28:26
Speaker 2: As you mentioned, and this goes to the Bellweather part,
28:29
Speaker 2: there is something like three thousand cases obviously different facts,
28:33
Speaker 2: but also different laws in the jurisdiction. So can it
28:39
Speaker 2: still be a Bellweather when you have different laws that
28:42
Speaker 2: are applied.
28:43
Speaker 4: Well, that's part of the reason for trying cases in
28:48
Speaker 4: different jurisdictions. He's got six cases teed up for Bellwether
28:55
Speaker 4: Trials tour in California too, in Arizona, two are in
28:59
Speaker 4: North Carolina. My guess is that he wants to see
29:03
Speaker 4: how those come out before scheduling more. But you're right
29:08
Speaker 4: at different state laws differences In the fact some of
29:13
Speaker 4: these plaintiffs suffered horrific sexual assaults, I think that may
29:20
Speaker 4: be important to a jury in deciding these cases. So
29:25
Speaker 4: there's factual variation, legal variation across states, and jury variation
29:32
Speaker 4: that could affect and produce different outcomes.
29:36
Speaker 2: In response to the Arizona verdict, Uber said, this verdict
29:40
Speaker 2: affirms that Uber acted responsibly and has invested meaningfully in writers' safety,
29:46
Speaker 2: but it is going to appeal the finding that the
29:49
Speaker 2: driver was acting as an agent of the company, saying
29:52
Speaker 2: the judge aired on the instructions given to the jury.
29:56
Speaker 2: When Uber looks at this behind closed doors, should they
30:01
Speaker 2: be motivated to start settling cases or should they look
30:05
Speaker 2: at it and say, well, different juries can bring different results,
30:10
Speaker 2: so let's forge ahead.
30:12
Speaker 4: The first thing I hope is that this motivates Uber
30:16
Speaker 4: to find better ways to protect their passengers. When tort
30:21
Speaker 4: law is working right, it results in better safety precautions
30:28
Speaker 4: being taken, and we can go across a whole lot
30:32
Speaker 4: of areas. Asbestos is a great example of that. So
30:36
Speaker 4: that's the first thing. I think it's probably too early. Publicly,
30:42
Speaker 4: of course, Uber is going to deny that they have
30:44
Speaker 4: any liability and appeal and do all the things that
30:48
Speaker 4: defendants who are held liable do. I think it's probably
30:53
Speaker 4: too early for Uber to say, Okay, what we need
30:59
Speaker 4: to do now is figure out a global settlement in
31:04
Speaker 4: other mass torques. As the cases develop, you see defendants
31:10
Speaker 4: see global peace, and that's a complicated dance that occurs,
31:19
Speaker 4: and I think that's what Judge Brier in those federal
31:22
Speaker 4: cases that you referred to, is trying to develop. But
31:27
Speaker 4: first Uber needs to get a feeling. Then the Plaineff
31:31
Speaker 4: lawyers need to get a feel on really how much
31:36
Speaker 4: is their exposure here, and these first two cases give
31:39
Speaker 4: us a little bit of information. It might be different
31:44
Speaker 4: if the first two cases both came in with very
31:48
Speaker 4: high liability and very high damage awards or vice versa.
31:53
Speaker 4: That hasn't happened. That may suggest we're going to need
31:56
Speaker 4: to try more cases to see how jurys respond.
32:02
Speaker 2: The American Law Institute amended its restatement of tourts.
32:07
Speaker 4: Yeah. So there have been a lot of suits not
32:10
Speaker 4: just against Uber, but by women who have been sexually
32:15
Speaker 4: assaulted in a variety of contexts. Think a woman who's
32:19
Speaker 4: arrested by a police officer. Think a woman who is
32:24
Speaker 4: incarcerated in a jail or a prison, think about patients
32:30
Speaker 4: in the hospital. What we also found as we were
32:34
Speaker 4: doing this research is that there has been a trend.
32:38
Speaker 4: Despite what I said earlier about no vicarious liability for
32:43
Speaker 4: sexual assaults because they're not for the benefit of the employer,
32:47
Speaker 4: and that was the Hornbuck black Letter rule, we found
32:53
Speaker 4: a number of courts finding ways to permit those plaintiffs
32:58
Speaker 4: to continue to pursue their case by curious liability case
33:03
Speaker 4: against the employers of these people employees who are committing
33:09
Speaker 4: sexual assaults, and there were enough cases where we found
33:13
Speaker 4: that that the American Law Institute, which develops restatements of
33:18
Speaker 4: the law, decided last May to promulgate a special rule
33:24
Speaker 4: that says that employers of employees who are given power
33:34
Speaker 4: or control over vulnerable potential victims and who use that
33:41
Speaker 4: position to commit a sexual assault a special rule that
33:46
Speaker 4: says by curious liability can be imposed there by a
33:50
Speaker 4: journey that would be a significant game changer for these
33:56
Speaker 4: cases if courts that do not have have not adopted
34:01
Speaker 4: that rule decide to adopt it. I'm very interested to
34:05
Speaker 4: see how that provision that the ALI adopted last May
34:10
Speaker 4: plays out when plaintiffs attorneys try to use that to
34:15
Speaker 4: convince accord in Kansas or Alaska or New Mexico to
34:21
Speaker 4: expand the scope of vikeras liability for sexual assaults.
34:25
Speaker 2: Thanks so much for joining me on the show. That's
34:28
Speaker 2: Professor Michael Green of the Washington University School of Law.
34:33
Speaker 2: And that's it for this edition of the Bloomberg Law Show.
34:35
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