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I will remember Creative as the company that issued repeated lawsuits against Aureal Semiconductor (losing repeatedly), then bought their assets when Aureal was

I will remember Creative as the company that issued repeated lawsuits against Aureal Semiconductor (losing repeatedly), then bought their assets when Aureal was forced to declare bankruptcy due to legal fees.

danuker 4y ago
> losing repeatedly > bankruptcy due to legal fees. Don't the legal fees get paid by the losing side?
- ncphil 4y ago
  Not in "the American system". Litigation is a rich person's game, and often used to grind down competitors: or just grift a lucrative settlement.
- bdowling 4y ago
  In the American legal system, each party pays its own legal fees unless there is (1) a statute that specifies fee-shifting or (2) a contract between the parties that specifies fee-shifting. The reasoning behind this is that to require the loser to pay all fees would discourage "good" lawsuits. (e.g., an individual with a decent case against a big company, may be discouraged from filing because of the potentially catastrophic costs if he doesn't win.)
  - AndrewOMartin 4y ago
    This is presumably why American corporations typically live in such fear of individuals with a good case and modest resources. I know this isn't your idea @bdowling, and it's actually interesting to hear the reason, but I couldn't resist /s posting.
    - bdowling 4y ago
      The "American Rule" also leads to many lawsuits of questionable merit being brought against corporations (and wealthy individuals). Attorneys take these cases on contingency, knowing that the defendant will likely just settle rather than incur a lot of legal fees, and the firm will take 33-40% of the settlement. These "nuisance lawsuits" are a big problem for some industries. If there was universal fee-shifting, these suits would be discouraged. It can be worse though. In some jurisdictions and for certain types of claims (e.g., employer-employee wage/hour suits in California), statutes provide for "one-way fee shifting". One-way fee-shifting means that if the plaintiff wins, the defendant pays the plaintiff's legal fees, but if the plaintiff loses, the plaintiff does not pay the defendant's legal fees. Predictably, this leads to some law firms specializing in these types of cases, taking cases on contingency, discouraging the plaintiff from settling, and racking up huge legal fees that will be paid by the defendant if they win. And the law supports this. I read one article about the California Court of Appeals upholding a $250,000 fee award in a case over $20,000 in unpaid wages.
  - danuker 4y ago
    > because of the potentially catastrophic costs if he doesn't win Well, a judge could rule how much of a company's costs are fit for compensation, also considering the material situation of the plaintiff.
jasonwatkinspdx 4y ago
Yup. And basically the day the bankruptcy acquisition closed they nuked the support website and took the drivers offline. Creative is an incredibly scummy company. I don't know anything about the founder but generally have found the fish rots from the head on issues like this.

danuker 4y ago

> losing repeatedly > bankruptcy due to legal fees. Don't the legal fees get paid by the losing side?

ncphil 4y ago
Not in "the American system". Litigation is a rich person's game, and often used to grind down competitors: or just grift a lucrative settlement.
bdowling 4y ago
In the American legal system, each party pays its own legal fees unless there is (1) a statute that specifies fee-shifting or (2) a contract between the parties that specifies fee-shifting. The reasoning behind this is that to require the loser to pay all fees would discourage "good" lawsuits. (e.g., an individual with a decent case against a big company, may be discouraged from filing because of the potentially catastrophic costs if he doesn't win.)
- AndrewOMartin 4y ago
  This is presumably why American corporations typically live in such fear of individuals with a good case and modest resources. I know this isn't your idea @bdowling, and it's actually interesting to hear the reason, but I couldn't resist /s posting.
  - bdowling 4y ago
    The "American Rule" also leads to many lawsuits of questionable merit being brought against corporations (and wealthy individuals). Attorneys take these cases on contingency, knowing that the defendant will likely just settle rather than incur a lot of legal fees, and the firm will take 33-40% of the settlement. These "nuisance lawsuits" are a big problem for some industries. If there was universal fee-shifting, these suits would be discouraged. It can be worse though. In some jurisdictions and for certain types of claims (e.g., employer-employee wage/hour suits in California), statutes provide for "one-way fee shifting". One-way fee-shifting means that if the plaintiff wins, the defendant pays the plaintiff's legal fees, but if the plaintiff loses, the plaintiff does not pay the defendant's legal fees. Predictably, this leads to some law firms specializing in these types of cases, taking cases on contingency, discouraging the plaintiff from settling, and racking up huge legal fees that will be paid by the defendant if they win. And the law supports this. I read one article about the California Court of Appeals upholding a $250,000 fee award in a case over $20,000 in unpaid wages.
- danuker 4y ago
  > because of the potentially catastrophic costs if he doesn't win Well, a judge could rule how much of a company's costs are fit for compensation, also considering the material situation of the plaintiff.

jasonwatkinspdx 4y ago

Yup. And basically the day the bankruptcy acquisition closed they nuked the support website and took the drivers offline. Creative is an incredibly scummy company. I don't know anything about the founder but generally have found the fish rots from the head on issues like this.