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EXPERT WITNESS The Baron of Toxic Torts

An errant memo triggers a PR nightmare for Fred Baron.
By JOE CALVE |

LAST SUMMER, BARON & BUDD, THE wealthiest and most influential plaintiffs personal-injury law firm in the city, made a monumental gaffe.

It happened at one of the hundreds of depositions the firm conducts every year. A B&B lawyer routinely handing over documents to a defense lawyer accidentally included an internal firm memo titled “Preparing for Your Deposition.”

It was as if the Warren Commission had handed Oliver Stone the smoking gun from the grassy knoll.

The document advises B&B clients suing asbestos manufacturers on how to handle their depositions. When Baron’s opponents got wind of the memo’s contents, they joked it should have been called “Preparing for Your Perjury.” The Wall Street Journal, standard-bearer for the anti-plaintiff crowd, gleefully pounced on the document’s more over-the-top admonitions, including the following;

“It is important to maintain that you NEVER saw any labels on asbestos products that said WARNING or DANGER.”

“Do NOT say you saw one brand more than another, or that one brand was more commonly used than another.”

“If there is a MISTAKE on your Work History Sheets, explain that the ’girl from Baron & Budd’ must have misunderstood what you told her when she wrote it down.”

That last bit of advice is kind of ironic. Confronted with the memo, firm founder and leader Fred Baron pinned its creation on a “girl” from Baron & Budd-a rogue paralegal who ostensibly drafted it without the knowledge of any of his lawyers, a claim that any attorney who read the memo might find hard to believe.

Defense lawyers for asbestos manufacturers took the offensive. They accused Baron’s firm of coaching its clients to He. They peppered the firm with motions in Texas and other states where the firm has thousands of asbestos cases pending. They accused Baron of fraud.

Some judges seemed to agree. They froze Baron’s cases and referred him to the Bar’s discipline authorities. A district judge in Dallas turned the matter over to a criminal grand jury, and the most aggressive of the asbestos defendants, Raymark, used the memo as Exhibit A in a federal suit accusing Baron of being a racketeer.

Trying to control the damage. Baron countered that asbestos victims are often ill, elderly workers and the document was designed to help them remember long-ago events, not to lie. He said his lawyers did not use the memo, and he wrestled in the courts for control of it, claiming it was protected attorney work product (as it is clearly labeled).

But Baron was on the ropes.

“It was disheartening,” Baron says. “I had never before been accused of an ethical lapse. I can’t remember a more difficult time.”

Actually, these are both the best of times and the worst of times for Fred Baron, one of the most successful plaintiffs lawyers in the country and half of one of Dallas’ premier power couples. Baron’s wife, Lisa Blue, a former sex therapist and jury con-sultant, now tries cases for Baron & Budd, which also counts among its partners state Rep. Steve Wohlens, who is married to influential journalist and now Dallas City Councilwoman Laura Miller.

Haven’t heard of Baron?

Perhaps that’s because he doesn’t troll for clients the same way some of his more obnoxious-and better known-colleagues do. You won’t see his name splayed across the back of a city bus, and you won’t see it splattered across the pages of your TV magazine.

Yet he’s made a fortune in his corner of the personal-injury business: high-stakes litigation on behalf of workers who claim they are injured by toxic substances, especially asbestos. His firm, by focusing sin-gle-mindedly on representing plaintiffs in these so-called toxic-tort cases, has grown to be the largest of its kind in the country. And Baron has reaped rewards beyond even his wildest dreams.

Such riches mean Baron and Blue can afford to build a palatial home in Preston Hollow that is shaping upas one of Dallas’ most audacious (no small affair in a city in which audacity is never in short supply). And even in his wildest dreams. Baron probably never expected to be hosting the president of the United States, as he and his wife did in June when Bill Clinton swung through Dallas to attend a fund-raiser at the home of Ray Nasher.

Baron’s wealth also means he can take on seminal cases, such as Georgine v. Amchem Products, which many personal-injury lawyers feared would cut the heart out of their business, and turn them into personal crusades, Baron doggedly pursued Georgine all the way to the U.S. Supreme Court, becoming a national folk hero to the members of the plaintiffs personal injury bar.

“All hail Fred,” they cried, “baron of tort!”

To the pro-business crowd, that’s kind of like being hailed as the Lord of Hell. Along with lawyers like Houston tort kings John O’Quinn and Joe Jamail, Baron has become a symbol of all that’s wrong with the legal system. In the same venomous column savaging Baron over the memo affair, the Journal hurled at him what may be the nastiest epithet you can hang on a plaintiffs lawyer: It called the former Nader’s Raider a plutocrat.

Ouch!

And that’s where the worst of times come in. All things considered, these are the worst of times for the plaintiffs bar, perhaps the most reviled segment of a reviled profession. The last year has been especially nightmarish for Baron, who, because of Georgine and the memo goof, became a lightning rod for pro-business, anti-plaintiff interests.

The climate was right for it. Over the last decade, business and insurance interests have unleashed a torrid lobbying and public relations campaign designed to convince lawmakers, judges, jurors, and the public that plaintiffs lawyers like Fred Baron are leeches sucking the blood out of society. They drive up the cost of everything from auto insurance to football helmets; they close children’s playgrounds; they force useful drugs off the market.

And, like Baron, they get phenomenally rich doing it, thanks to the magic of the contingent fee, which allows them to play what looks to the public like a kind of legal lottery. When they hit the jackpot for their clients, most of whom are deadbeats looking to get rich quick off a simple fender bender, they lop off a third or more as a fee.

What a sweet deal!

The message has taken hold. Lawmakers have rewritten civil liability laws to make it harder to recover for injuries. Jurors have become downright tight-fisted, except in the most grievous cases. They blame the victim more than the wrongdoer, which has put the defense-often an insurance company-in the driver’s seat.

But despite the anti-plaintiff climate. Baron has been riding high. His career trajectory, which in many ways tracks the trajectory of the mass-tort business, was reaching its apogee when the memo fiasco broke.

Baron’s roots, like those of many of his colleagues, are sunk firmly in the idealistic soil of the late ’60s and early ’70s. Baron entered the University of Texas law school in 1968, but his watershed year was 1970. That’s when Ralph Nader came to town and delivered a speech that inspired Baron to troop to Washington to work on one of his projects. Life in Washington convinced Baron that government wasn’t the answer for the little guy; litigation was.

So after school Baron hooked up with the Dallas firm of liberal Democrat Oscar Mauzy, which handled a lot of union business. That’s where Baron discovered toxic torts. Only they weren’t called toxic torts then; the name wouldn’t be coined for years. But there was no denying that there were some very sick workers who had been injured by something.

That something was alleged to be asbestos. In Baron’s first case, the workers were from a plant near Tyler. Baron believed they’d been harmed by exposure to raw asbestos fiber.

Baron tried to mount a class action suit, but the courts rebuffed him. The law just wasn’t ready for this new breed of tort claim. So Baron, with a handful of other pioneers, began crafting legal theories that would allow them to recover damages from asbestos manufacturers, claiming they had known since the 1930s that their product was toxic.

Intoxicated with toxic torts, Baron left Mauzy and hung out a shingle. As his reputation grew, so did his business. The practice expanded beyond asbestos claims, including an epic battle on behalf of more than 200 families from Dallas’ largest public housing project who said they’d been poisoned by a lead smelter.

And Fred Baron got filthy rich.

Then along came a case that threatened the whole shebang; Georgine v. Amchem Products.

Georgine was a bold attempt to take the whole messy asbestos business, which was giving the courts fits, and wrap it all up in one neat and, for some plaintiffs lawyers, highly lucrative settlement.

In 1991 a judicial panel that oversees large, complex cases consolidated all pending asbestos suits and assigned them to one federal judge in Philadelphia.

By 1993 a consortium of 20 leading asbestos manufacturers had proposed a SI .3 billion settlement with a small troop of well-heeled plaintiffs lawyers, including Ronald Motley (who has been making headlines lately as the hired gun for plaintiffs in tobacco litigation in Texas and other states). As part of the deal, the plaintiffs lawyers would haul off tens of millions of dollars in legal fees.

The deal was highly controversial because it purported to bind future claimants-people exposed to asbestos who had not yet filed injury claims. Essentially, it foreclosed them from the possibility of ever pressing their claims in court.

That’s what rankled Baron. It looked like Motley and other attorneys were selling their clients down the river, establishing a dangerous precedent by allowing companies to use class actions to shield themselves from future claims.

Baron could have shared in the riches. Instead, he jumped in to wreck the deal. His competitors squealed foul. Even his supporters in the plaintiffs bar doubted he could pull it off.

“When he first took it on, nobody gave him much of a chance ,” says Reagan Sil-ber, one of Baron’s competitors in Dallas. “Everybody in his peer group made fun of him. They said the companies are too powerful and the courts are too wired.”

No longer a poor and idealistic law student, Baron poured millions of his own money into the case and hired renowned constitutional law scholar Laurence Tribe to take it all the way to the U.S. Supreme Court. He won.

Of course, the case didn’t make Baron the darling of the pro-business set. And then hot on its heels came the memo fiasco, which gave the Journal and Baron’s powerful enemies the kind of ammunition they thought just might take him down.

Although the firm seems to be weathering the memo storm, the mess is by no means over. There’s sure to be continued fallout in the press and the courts, although the grand jury investigation has fizzled and Raymark’s fraud suit is proving to be threadbare. In fact, Raymark’s attorney has been referred to the DA’s office for criminal investigation, opening yet another chapter in the matter that’s sure to keep it on the radar screen.

But a stray memo isn’t going to shoot down The Baron of Toxic Torts. Rather, other forces are at work-the tort reform movement, congressional determination to shield businesses from certain types of suits, the continued anti-plaintiff climate in the courts, and local legislative moves-that surely spell harder times for firms like Baron & Budd.

Baron’s image has suffered, but not enough to concern his colleagues, who have put him in line to lead an influential national association of trial lawyers at a critical time in the organization’s history.

That’s because, despite Baron’s riches, his peers still look at him as a working-class hero who has stayed true to his roots. “I’d like to tell you he’s forgotten the little people.” Silber says, “but that’s just not the truth.”

And that may make Fred Baron the oddest plutocrat around.

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