M-LAW smoked out

Jul 28, 1999 at 12:00 am

Since Michigan Lawsuit Abuse Watch first came on the scene in 1996, questions have been raised about whether it is truly the grassroots organization it claims to be.

Among those raising questions has been the Michigan Trial Lawyers Association, whose members stand to be on the losing end should M-LAW succeed in its goals of electing conservative judges and seeing legislation passed to limit the liability of businesses and corporations when their products injure or kill.

Also raising questions about the group has been the Metro Times, which has reported on the public relations industry’s stealth campaign for tort reform in states across the country. Special interests fund groups that appear to be efforts by concerned citizens organizing on a grassroots level. Critics call them "AstroTurf" groups.

The strategy was explained in 1992 by "AstroTurf" specialist Neal Cohen when his address to a PR industry group was recorded. A tape of the speech was obtained by the publication PR Watch.

The secret to success, said Cohen, was to disguise the goals of particular special interests to make it appear that they actually had broad public support.

"(The trial lawyers) didn’t really know who was at the heart of everything," boasted Cohen. Using an example in Mississippi, he said, "There were no reporting requirements … and the problem they faced was we had 1,500 Mississippians mixed in with who our clients were. …"

From the start, M-LAW has maintained it is a legitimate grassroots organization that sprang up in response to citizen concerns about the damage excessive liability lawsuits were doing to the Michigan’s business community, its economy and, by extension, its citizenry.

M-LAW claimed broad and diverse support, but its donor list was not subject to public disclosure.

According to Internal Revenue Service documents, which the Michigan Trial Lawyers Association provided the Metro Times, M-LAW received start-up funding of $235,000 from the American Tort Reform Association, a group that represents manufacturers, insurance companies and – despite M-LAW’s claim that it takes no money from cigarette makers – the tobacco industry.

Furthermore, the IRS had serious questions about the structure of M-LAW.

While the group was telling the Metro Times and other reporters that it was a broad-based, grassroots organization dedicated to educating the public about issues surrounding lawsuit abuse, it was trying to convince the IRS it deserved nonprofit status because it operated similarly to a chamber of commerce.

In 1998, the IRS wrote (support) "from what appears to be only a few sources, the large grant from a tort reform group, the limited expenditures you have made for promotional materials and your lack of employees make it appear you are not similar to a chamber of commerce." They went on to say, "you appear to be a single issue advocacy or lobbying group contacting for or acting on behalf of or performing services for another organization or organizations."

In the same communication, the IRS states: "The financial information you have submitted indicates that you concentrate your media campaign during election periods. Please explain why an organization established to address what is represented to be a continuing business problem appears to concentrate its efforts during election years."

In August 1998, an IRS agent observed that the problem with M-LAW was "they were flying under false colors, i.e. a business group masquerading as a ‘public watchdog.’"

When asked about the information in the documents, M-LAW President Robert Dorigo Jones said the group has since diversified its financial base and broadened its contributors and added to the strictly political work that the group concentrated on when it first started. The information, however, remains confidential.

Jones also said that, since the question was settled last year, M-LAW has expanded the scope of its work.

"This is ancient history as far as M-LAW is concerned."

Gary Fralick, spokesperson for the Michigan Trial Lawyers Association, had a different take.

"This just proves that what we’ve been saying all along has been the truth," said Fralick.