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19 Litig. News 1 (1993-1994)

handle is hein.journals/lignws19 and id is 1 raw text is: OCTOBER 1993 VOLUME 19, NUMBER I

LITIGATION

NEWS

ABA Urges Legislation to Restrict Banking Agencies from
Obtaining Asset Preservation Orders Against Lawyers

R    e ABA House of Delegates re-
cently approved and adopted resolutions
calling for several amendments to the
Federal Deposit Insurance Act to modify
and limit the authority of federal bank-
ing agencies to obtain asset preservation
orders and issue cease-and-desist orders.
The resolutions, which were adopted
in August at the ABA Annual Meeting
in New York, are based on the final re-
port and recommendations of the ABA
Working Group on Lawyers' Represcn-
tation of Regulated Clients. The House
also directed the ABA to oppose the fed-
eral agencies' interpretations and uses of

Coverage of 1993 ABA
Annual Meeting
Pages 1, 8-11
Special hisert:
Section Committees
Offer Opportunities
for All to Join

by Ralph A. Taylor, Jr., Associate Editor
the rules of professional conduct.
The House of Delegates' action is
embodied in nine resolutions, all co-
sponsored by the Section of Litigation
and recommended by the Working Group.
A key resolution calls for amendment to
the Act to require federal banking agen-
cies to seek priorjudicial approval for
the imposition of any asset freeze order
directed to institution-affiliated parties
-a term that, under certain circum-
stances, includes attorneys. The House
also directed the ABA to ask Congress
to clarify that the agencies arc precluded
from using their cease-and-desist powers

Supreme Court Rejects Due Process
Challenge to Punitive Damages Award
by Christine S. Sherry, Associate Editor
Sl    n a closely watched case, the  the Due Process Clause. Stevens foun d'
Supreme Court has declined to delineate  that the award in this case-a common
a bright-line due process standard for  law slander of title action in West Vir-
assessing punitive damage awards.    ginia state court-was not so excessive
In TXO Production Corp. v. Alliance  as to offcnd due process in light of the
Resources Corp., U.S. Supreme Ct. 92-  amount of money at stake, the bad faith
479, 61 U.S.L.W. 4766 (June 25, 1993),  and wealth of TXO, and the fact that the
the Court rejected substantive and pro-  scheme employed was a part of a pattern
cedural due process challenges to a $10  of fraud, trickery, and deceit. In so do-
million punitive damage award, which  ing, Stevens found that although the
was some 526 times the amount of con-  parties' desire to fornulat a test was
pensatory damages awarded. 'lie plurali-  understandable, neither respondents pro-
ty opinion held that the Court need not  posed rational basis standard nor TXO's
and indeed.., cannot, draw a mathe-  proposed heightened scrutiny standard
matical bright line between the constitu-  was applicable. The Court also rejected
tionally acceptable and constitutionally  various procedural due process attacks.
unacceptable that would fit every case:'  In a separate opinion, Justice Anthony
In his plurality opinion, Justice John  Kennedy disagreed that the focus of sub-
Paul Stevens, speaking for Chief Justice  stantive due process analysis should be
William Rehnquist and Justice Harry  on a reasonableness standard, but rather
Blackmun, concluded that the reasonable-  should be on ensuring that the award does
ness of a punitive damages award should  not reflect juror bias, passion, or preju-
be considered in determining whether it  dice. Justice Kennedy concluded that the
violates the substantive component of      (continued on page 6-Damages)

to secure the payment of money damages
claims that otherwise ordinarily arc
available only through prosecution of
damages suits.
In urging adoption of these resolu-
tions, the Working Group's report to the
House of Delegates notes that the federal
agencies, especially the Office of Thrift
Supervision, have not hesitated to use
their cease-and-desist powers against a
(continued on page 10-Preervation)
Need for Lawyers
to Represent
Children Grows
by Christine E. Sherry
Associate Editor
Mave you ever represented a child?
Would you take a case on behalf of a child
who was subjected to parental abuse, who
had been denied special education bene-
fits, or who needed access to health care?
The Section of Litigation, through
its Task Force on Children, is now urg-
ing its members to do just that. At the
ABA Annual Meeting in New York, a
Presidential Showcase program entitled
Who Will Remember the Children?
Meeting Children's Legal Needs: A Call
to Service brought together a blue rib-
bun panel of Section lawyers who under-
scored the desperate need for providing
pro bono legal services to children.
A. Leon Higginbotham, Jr., Philadel-
phia, a senior judge of the Third Circuit
Court of Appeals, emphasized the need
for providing children with legal repre-
sentation. Higginbotham recently chaired
an ABA Presidential Working Group on
the Unmet Legal Needs of Children.
The Working Group published a report,
America's Children at Risk:' which de-
tails the obstacles facing American
(continued on page iI-Chidren)

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