A selection of the need-to-know civil justice news for the week of February 1-7, 2014.
A selection of the need-to-know civil justice news for the week of February 1-7, 2014.
A selection of the need-to-know civil justice news for the week of January 25-31, 2014.
Jon Bramnick|The Record
As Americans, we believe in giving people a “second chance.” The proposed “Ban the Box” legislation is not the answer to the problem of a job applicant with a criminal history.
Imagine you are looking to hire someone to care for your elderly mother. That person will be alone with her and will have access to her home and her possessions.
After receiving applications for the job, you discover that one of the applicants has a criminal history of assault and theft. One would presumably be concerned about hiring that person to assist your mother.
You may not have a choice if “Ban the Box” legislation is enacted.
The latest report from the U.S. Chamber’s Institute for Legal Reform highlights litigation trends from across the country, and not surprisingly New Jersey is cast in an unfavorable light. New Jersey is noted as a hot spot for asbestos bankruptcy trust fraud and false claims act litigation. In addition, the report claims New Jersey is second only to California in the number of food related class action suits filed in the state, thanks largely to our state’s 6 year statute of limitations.
A selection of the need-to-know civil justice news for the week of January 18-24, 2014.
How to Sue Over the Christie Bridge Scandal and Win
John Culhane | Slate
As New Jersey Gov. Chris Christie tries to recover from the fallout for his administration’s participation in the vindictive decision to close lanes and snarl traffic on the George Washington Bridge for five days, he will get no help from lawsuits brought by angry citizens stuck in the mess. The first suit has already dropped. These claims will surely breed others. They could keep the story alive for years. And they could even result, unusually, in personal liability for the officials involved, including, perhaps, the governor himself.
If you think America's litigious culture is a recent trend, think again. Back in 1938, Ms. Helen Silva was enjoying a turkey dinner at Woolworth’s restaurant when she choked on a small bone. A bystander came to her rescue, but she sued the restaurant for $36 in medical fees and embarrassment. The bone was ultimately found to be native to turkeys (imagine that), nixing Woolworth's liability and the $500 judgment rendered against it.
What made Alabama's hospitality possible is a Good Samaritan Law which protects such volunteers from frivolous litigation. Greenwald's bill, A-3694, would provide immunity to licensed architects and engineers who volunteer at the scene of a declared emergency at the request of authorities.
Greenwald is hoping to advance the measure during the lame-duck session. It has been referred to the Assembly Regulated Professions Committee and is cosponsored by Assemblywomen Handlin and Jasey.
..said Good Morning America’s Lara Spencer.
Spencer was responding to news that a Texas high school football coach is suing the Dallas Cowboys Stadium over a runaway golf cart incident in 2011.
Remember that? Neither do I, but it supposedly went viral:
Despite conceding that he wasn’t seriously hurt while attempting to get the unmanned golf cart under control, Amendola is also seeking compensation for the following: past and future physical pain and suffering [interesting, since he wasn’t seriously hurt]; past and future mental anguish; physical impairment, past and future; disfigurement, past and future; past and future medical expenses; loss of earning capacity [he’s still a gainfully employed high school football coach]; loss of enjoyment.
Here's some advice: Drop the lawsuit and laugh. It’s the best medicine.
The chaos and heartache brought about by Hurricane Sandy forced New Jerseyans to appreciate the utilities and shelter we often take for granted, and incidentally, renewed our appreciation for gasoline and the containers which store it.
You may not realize it, but if you used a gas can during Hurricane Sandy and its aftermath, it was likely manufactured by Blitz, a company in a small Oklahoma town. And sadly, it's now a relic of the pre-lawsuit abuse era.
Blitz sold more than 14 million cans per year for the last decade, which translates to 75 percent of all gas cans sold in the United States. Fewer than two incidents per million cans sold were reported, and most involved obvious misuse. Pouring gasoline from the container onto an open fire was a common theme.
Of the 62 cases filed since 1994, only two made it to court and only of those cases was successful. The rest were settled or dismissed, notes a New York TImes report. Nevertheless, it still cost the Oklahoma-based company $30 million in legal fees, and presumably, higher insurance premiums to cover the additional $30 million paid by their insurance companies. Sadly, these costs of doing business in America forced the leading manufacturer of gas cans in the United States to close its 117-person operation for good. Buying domestic also just got a bit harder.
For New Jerseyans who retained their homes but lost their power, gasoline offered somewhat of a lifeline for those with generators to fill. And as shelters and motels filled to capacity, generators were able to keep more people in their homes even as temperatures dropped. A not-so-small silver lining during a catostrophic storm.
Of course we hope we never see a storm of Sandy's magnitude ever again. But if we do, the absence of Blitz in our markets may make generator-powered electricity a difficult commodity to deliver.
The most successful corporations in the United States view New Jersey's civil justice climate as worse than most, according to a study released by the U.S. Chamber of Commerce.
General Counsels from the nation's leading employers said that thirty-one states do a better job of executing civil cases timely and fairly.
"What the Chamber's study tells us is that successful corporations are aware of New Jersey's reputation for attracting abusive lawsuits, and they're thinking twice before expanding here," said Marcus Rayner, president of the New Jersey Civil Justice Institute. "Even though the economy has improved slightly, New Jersey is no better positioned to prevent abusive lawsuits from entering our court dockets than it was two years ago."
"New Jersey was once known as the nation's 'Medicine Chest' because so much of our economy is dependent upon the viability of our pharmaceutical companies and the life sciences. Every dollar that is spent fighting frivolous litigation is a dollar that won't be used to strengthen our economy or invest in life-saving research."
The study can be found online on the U.S. Chamber of Commerce's website: http://www.instituteforlegalreform.com/states.
With movement on pension and education reform, legal reform and medical liability reform may rise on the Governor’s agenda. The need for legal reform has grown more apparent in recent months as studies confirmed that New Jersey will face a shortage of physicians by the end of the decade. The State Senate unanimously passed legislation authorizing DHSS to convene a summit to analyze the shortage’s implications for New Jersey residents; its Assembly counterpart, A-1828, awaits action by the Assembly Health and Senior Services Committee.
Listen to executive director Marcus Rayner discuss the first of what is expected to be many lawsuits stemming from the movie theatre massacre in Aurora, Colorado on 1210 WPHT Philadelphia with Rich Zeoli.
“There’s only one person who’s responsible, and it’s the guy who’s been arrested.”
The controversial lawsuit was filed by a survivor of the massacre who was not physically injured. His lawyers say they are considering filing suit against everyone from Warner Brothers to the shooter’s doctors, to the move theater itself. The suspect, who was unemployed, does not seem to make the cut.
You can listen to the entire segment here: http://philadelphia.cbslocal.com/personality/rich-zeoli/#
Yes, that would be the killer.
A survivor of the Aurora, Colorado theatre massacre has hired an attorney and plans to file suit for his extreme emotional distress. According to TMZ, Torrence Brown, Jr. and his attorney are considering who to target for compensation – the movie theatre, the shooters’ doctors, or Warner Brothers. The alleged shooter, who was unemployed, apparently doesn’t make the cut.
It’s not surprising that this massacre, like so many before it, has revived a national conversation about gun control. Governor Christie has said that such a debate is premature for a nation in mourning. But what is as surprising as it is appalling, however, is the speed at which Brown’s attorney unabashedly began screening potential defendants to vet the best way to leverage our legal system for financial gain.
Brown wasn’t physically injured, but his friend, eighteen-year-old A.J. Boik, was shot in the chest and died.
Funerals for A.J. and other victims will take place later this week.
A class action lawsuit brought by major corporations and trade associations against Visa, Inc., and Mastercard, Inc., charged that the companies’ fees to retailers were excessive. And after a $725 billion settlement, the plaintiffs are seeing that the defendants aren’t the only ones charging high fees.
The settlement includes a $1.2 billion temporary fee-reduction. With history as a guide, attorneys can make as much as $600 million, which is roughly 10 percent of the remaining settlement. This puts it on par with fees received by lawyers during Enron, WorldCom, and Tyco litigation according to an expert quoted in a Reuters report.
New Jersey is treacherous ground for physicians.
Few people deny that the earth is getting warmer. And few people deny that New Jersey’s exodus of doctors (the so-called “Medical Brain-Drain”) will affect New Jerseyans’ access to healthcare.
There are likely many reasons behind this phenomenon, as the Department of Health and Senior Services Summit (S173), if enacted, hopes to uncover. High cost of living and a lack of tax incentives are frequently cited, as are the costs of liability of insurance (click here for one New Jersey’s medical student’s story).
And with respect to the number of claims filed against physicians each year, New Jersey is an outlier among states.
Comparing New Jersey to Ohio, for instance, is revealing: despite having a population which exceeds New Jersey’s by two and a half million, the Garden state had 630 medical liability claims in 2011 to Ohio’s 287. New Jersey even managed to surpass Texas, which has nearly three times the number of residents, in the number of medical liability claims last year (Texas had 550 claims in 2011, in case you were wondering).
“A physician shortage crisis is right around the corner in New Jersey if we do not take immediate steps to change course,” J. Richard Goldstein, president and CEO of the New Jersey Council of Teaching Hospitals, said in a 2010 news release. “National health reform, while laudable and needed, will only work to accelerate the time when there simply will not be enough doctors to serve New Jersey’s adults and children.”
Should meaningful medical liability reforms continue to stagnate, despite Dr. Goldstein’s warnings, New Jersey will continue to educate other states’ physicians, at the cost access to care for New Jersey’s residents.
You know it’s serious when legal reformers and trial lawyers agree.
Legal reformers consistently argue that when the publicly-financed civil court system is inundated with absurd litigation, the brakes are put on justice for everyone else.
Child custody cases, divorces, landlord-tenant disputes, and temporary restraining orders sought by battered women must compete for the same day in court as the guy who sues the bar after crashing his motorcycle in a drunken stupor and the woman who spills hot coffee on her lap.
And that day in court, of course, is underwritten by taxpayers. So when funding is cut to the judicial branch, as it was in 42 states last year, the pace of justice slows considerably.
"The impact on people in great distress, such as abused women seeking temporary restraining orders, is beyond measure in money," says Jon Streeter, president of the State Bar of California.
The simplest divorce cases can now take a year to resolve in some states. “Such delays are not just creating inconvenience for people trying to claim money from landlords or tenants, or fight traffic tickets. Court cuts are hitting people where they live,” writes Alan Greenblatt for NPR.
Criminal cases take precedence over civil cases, of course. But that’s hardly comforting to the everyday Americans who need the civil court system to protect them or make them whole. One circuit in Georgia stopped hearing civil cases altogether.
Backlog in states have become so significant that Institute for Legal Reform President Lisa Rickard and American Bar Association President Bill Robinson III pleaded with lawmakers to take cuts to the judiciary seriously. "When states financially starve their judiciaries, they inadvertently create environments toxic to economic growth," they wrote in an op-ed in USA TODAY.
A $4.1 million settlement awarded to a north Jersey man who overdosed on stolen drugs as a teen is gaining national infamy. The U.S. Chamber of Commerce nominated it for this month’s Most Ridiculous Lawsuit http://www.facesoflawsuitabuse.org/.
The plaintiff, who said the neighborhood pharmacy should have done a better job of guarding the drugs his friend stole, sued several partygoers, the host, and the host’s mother in addition to the pharmacy.
The pharmacy will pay the majority of the settlement.
As of today, the Bergen County settlement is killing the competition by a 3 – 1 margin. You can cast your vote on the Institute of Legal Reform’s website.
"In this case, the pharmacy was the victim - not the plaintiff, who made a decision to ingest stolen drugs.” said Marcus Rayner, NJLRA’s executive director. “Yet it is the pharmacy that is being denied justice by today's legal system and the drug user who is benefiting from it.”
“This case underscores just how much our tort system has become out-of-step with common sense and fairness. Instead of investing in Ridgewood's local economy, Harding Pharmacy will be sending $1.9 million to the pocket of a man who made poor and illegal choices,” he said.
Doesn’t this just make your heart, um, not swell with pride?
What do the New Jersey Lawsuit Reform Alliance, the New Jersey Chamber of Commerce, NJBIA, New Jersey Retail Merchants Association, National Federation of Independent Business-New Jersey, Chamber of Commerce of Southern New Jersey, Chemistry Council of New Jersey, New Jersey Food Council, and the Healthcare Institute of New Jersey have in common?
Legal issues involving businesses are complex, laden with terminology and evidence which is unfamiliar to the common court. Highly technical matters are identified and addressed at great cost to both businesses and taxpayers alike. The advantage of a business court is that it would permit business-related judicial matters to be heard by courts with an established background and knowledge of such litigation. A majority of northeastern states already have a business court in place, and it is actively under consideration by several others.
Establishing a business court doesn’t just improve the efficiency of our court system – it sends a strong message to businesses that New Jersey is a solid place in which to expand and hire workers.
A-265 was posted today for discussion only. NJLRA looks forward to the bill’s reintroduction and advancement in the 215th legislative session, which begins next week. You can download a copy of NJLRA's testimony in support of business courts here.
Unfortunately, it occurs all too often: a plaintiff overstates, inflates, or fabricates an injury altogether after an auto accident and seeks compensation.
And then she posts photos of herself completing a 5k on Facebook.
Defendants are beginning to fight back, asking courts for permission to introduce a plaintiff’s Facebook content if it appears to contradict statements made in court about the scope of their injuries.
In a recent Pennsylvania case, Largent v. Reed, Jennifer Largent claimed that an automobile accident caused by the defendant, Jennifer Rosko, left her and her husband with “serious and permanent physical and mental injuries.” Largent’s injuries were so extensive that she needed to walk with a cane, she told the Court.
All it took was a search of the plaintiff’s public profile to see Largent’s status updates about going to the gym and “enjoying life with her family.” Judge Richard Walsh was satisfied that the defendants met relevancy standard needed to probe the rest of her page. Noting Facebook’s motto – “Facebook helps you connect and share with the people in your life” – Walsh wrote:
[No court has ever] recognized a ‘general privacy privilege’ for Facebook information, and neither will we… only the uninitiated or foolish could believe that Facebook is an online lockbox of secrets.”
Ben Present, writing for the Legal Intelligencer, notes that this is the third Pennsylvania civil court to decide that a party’s Facebook page falls within the scope of discovery if posted information appears to contradict statements in discovery or testimony. Let’s hope that plaintiffs and attorneys will begin to think twice before crowding our courts with bogus claims- that’s something honest Pennsylvanians can ‘like.’
Dateline NBC will be airing an interview this evening with Justine Winters, the Montana teenager who made headlines last year for killing a pregnant mom and her 13-year-old son during a failed suicide attempt. What Dateline does not mention in its teaser (as of now, at least) is that Winters later filed suit against the deceased mother’s estate for, among other things “lack of capacity to enjoy [her] life.”
Winters was driving at a speed of 86 miles per hour, not wearing a seatbelt, and texting her ex-boyfriend of her plans to crash her vehicle when she struck pregnant Erin Thompson and her son Caden.
“Crossing the Line” airs at 9 p.m. EST.
Unless you read about it here, of course.
If you purchased a $0.99 iTunes giftcard, you could make a 30% return on your investment.
Apparently iTunes raised the price of most of their songs from $0.99 to $1.29 in April 2009. In legalese, this means that if you purchased a $0.99 giftcard before May 2010 (and no, I don’t understand the point of a $0.99 giftcard, either), you may be entitled to a large cash credit of $3.25.
Attorneys William M. Audet, Jonas P. Mann, Audet & Partners, LLP were kind enough to file this class action lawsuit on your behalf. They are seeking a mere $2.1 million for their trouble. The named plaintiffs in the suit, Johnson v. Apple Inc., will receive a $2,500 return on their $0.99 investment.
While Apple maintains that it did nothing wrong, it seems that they’ve preferred to roll over and play dead rather than to risk an even greater financial loss: they are not contesting the $2,500 settlement for each named plaintiff, nor are they contesting the aforementioned attorneys’ fees. The class’s own attorneys state:
Apple denies all allegations in the Lawsuit and in the Owens Action, and has asserted many defenses. Apple is entering into this settlement to avoid burdensome and costly litigation. The settlement is not an admission of wrongdoing or an indication that any law was violated.
And yes, if you were one of the folks who used a $0.99 iTunes giftcard during this period, they are representing you as well (unless you choose to opt out of the settlement – which you must do before December 29th).
Finally, no greediness permitted: the fine print clearly states that you are entitled to one $3.25 credit, no matter how many giftcards you redeemed. Click here to enlarge and see for yourself:
Want to see New Jersey's unemployment rate drop by up to 2.3%?
Tort reform would bring a welcome infusion of cash and jobs into New Jersey’s struggling economy, according to a report issued by the U.S. Chamber of Commerce’s Institute for Legal Reform.
New Jersey could save as much as $1.7 billion if comprehensive tort reform is enacted, according to the study, which measured New Jersey’s tort activity index. A decrease in the state’s index would also yield between 35,000 and 94,000 new jobs, nudging the state’s unemployment rate down from 9.2% to 8.35% - 6.9%. Litigation costs would drop by as much as 21.5%.
“The correlation between tort reform and economic growth is evident,” said Marcus Rayner, executive director of the New Jersey Lawsuit Reform Alliance. “This study demonstrates that the economic growth New Jersey so desperately needs can be spurred with common-sense tort reform.
“$1.7 billion reinvested in our economy will help put people back to work and help New Jersey reclaim its economic footing. Civil justice reform is a way to capture the money we waste on lawyer’s fees and litigation costs – without raising taxes or cutting essential services.”
A state’s tort index is comprised of the number of tort claims filed annually, the frequency of major verdict awards, and the concentration of attorneys practicing in the state.
Statehouses across the country are grappling with budget deficits and declining revenue. We’ve all heard of successful programs meeting their demise due to an absence of funding. Crippling budgetary trade-offs being made to our educational system, law enforcement, and the like have become so commonplace that they barely raise eyebrows in disbelief.
What we’ve heard less about is the economic downturn’s impact on a key cornerstone in our democracy: justice.
Layoffs, furloughs, and unfilled judicial vacancies eventually leave their mark on our judicial system. The American Bar Association’s Task Force on Preservation of the Justice System found that civil cases have been the hardest hit by budget cuts. Typical civil cases include everything from child custody and divorce to employee compensation.
In the past few months, we’ve had a patron pursue a lawsuit against restaurant for injuries he sustained while driving his motorcycle drunk all the way up to the State Supreme Court; a lifeguard sue for age discrimination just before he retired; a patient who fell asleep while polishing a gun sue his doctor; and a woman who filed suit against ABC, claiming to be “severely damaged” after the station read the wrong winning lottery numbers.
These are the types of cases pushing back court dates for issues that matter. These are the types of cases being vetted when resources thin and demand for the court’s services grow. And yes, these all happened here in New Jersey.
“All of us must have and protect our right and our freedom to use courtrooms when we need to…That courtroom must be open to protect families…to validate and protect contracts for business...” said newly elected ABA President Wm. T. Robinson III at a symposium in Kentucky.
Spreading ever-thinning public funds around may be a new reality for the foreseeable future. But compromising access to justice is one sacrifice Americans shouldn’t have to make.
No matter what the trial lawyers tell you, filing a frivolous lawsuit isn’t a victimless crime.
Have you ever been asked “Can I have your ZIP code?” by a perky cashier?
It’s not something I have an issue with- after all, they’re just numbers that I happen to share with 25,000 other people.
Kerry Feder, a Verona, NJ resident, doesn’t see it that way. She was asked by a store employee for her ZIP code when making a purchase at Williams-Sonoma in Upper Montclair earlier this year. Instead of simply declining, Feder decided to file suit under New Jersey’s Truth in Consumer Contract, Warranty, and Notice Act (TCCWNA).
Fortunately, Feder v. Williams-Sonoma Stores Inc. was thrown out by a federal judge in Newark earlier this week. Judge William Walls found that Williams-Sonoma’s practice does not violate CCWNA because the “Can I have your ZIP code” request is not made under the provision of a written contract.
Unfortunately, however, a Morris County judge reached the opposite conclusion just a few weeks ago in a case against Harmon Stores. The New Jersey Law Journal reports that Superior Court Judge Stephan Hansbury rejected the notion that a ZIP code is “too broad an identifier to be the subject of a privacy violation.” (The same attorneys, by the way, represented the plaintiffs in both TCCWNA suits).
The reason why there is a sudden rush to try class action TCCWNA cases in New Jersey (even though this practice has been around for so long it’s rather routine) is likely due to a California Supreme Court ruling against Williams-Sonoma in February, which found that collecting ZIP codes violates their state’s consumer statutes. A plethora of similar cases have since been filed across California, and it seems that New Jersey is poised to be the second state in which the trial attorneys want to test the waters.
The courts’ conflicting rulings suggest that New Jersey might be in for more TCCWNA class action suits. Trial attorneys may see the dollar signs at the end of the road, but remember who pays the bill: consumers, who pay stores’ legal overhead in the form of higher prices; job-seekers, whose opportunities part-time and seasonal employment may be extinguished; and taxpayers, who are forced to subsidize these cases as they make their way through the court system.
So, you can stand up and be counted, and give your ZIP code if asked – (and if it means better advertising and coupons for me, I’m for it) – or you can decline. The choice should be yours – not the trial bar’s to make for you.
“… why not offer legal protections to the ugly, as we do with racial, ethnic and religious minorities, women and handicapped individuals?”
Extending the Americans with Disabilities Act to protect the “ugly?” Seriously?!
Most of us are taught that beauty is in the eye of the beholder, not the ADA attorney.
Nevertheless, Professor Daniel S. Hamermesh at the University of Texas, Austin, argues that even affirmative-action programs for the ugly should be in order. Yes, he’s actually advocating to put ugliness-based lawsuits on the same platform of racial, ethnic, gender, and disability-based employment discrimination.
Oddly enough, he seems to acknowledge that money is the motivating – not supporting – factor in bringing potential lawsuits:
“There are other possible objections. ‘Ugliness’ is not a personal trait that many people choose to embrace; those whom we classify as protected might not be willing to admit that they are ugly. But with the chance of obtaining extra pay and promotions amounting to $230,000 in lost lifetime earnings, there’s a large enough incentive to do so. Bringing anti-discrimination lawsuits is also costly, and few potential plaintiffs could afford to do so. But many attorneys would be willing to organize classes of plaintiffs to overcome these costs, just as they do now in racial-discrimination and other lawsuits.”
Gee, there’s an idea. Let’s refrain from bathing and personal care and sue our way into cold hard cash. Exactly what our business community (and kempt colleagues) need to thrive during an economic downturn.
If you’re a small business entrepreneur and manage to sneak some time away this summer (or just a concerned citizen wanting to learn more about how your local government works), you might want to pick up a copy of Assemblywoman Amy Handlin’s latest book, Government Grief: How to Help Your Small Business Survive Mindless Regulation, Political Corruption, and Red Tape.
Handlin, who represents the 13th Legislative District, offers practical advice for engaging with local government officials. There are also extensive glossaries designed to make navigating the multitude of government bureaucracies easier, as well interesting commentary on what Handlin calls the “corruption tax.”
Perhaps best of all, the book is straightforward, down-to-earth, and actually helpful; it’s not filled with the generalities and hyperboles we’ve come to associate with elected officials. She stresses that the advice offered in her book (which is rooted in her extensive backgrounds in marketing and public service) is applicable to every state and local jurisdiction.
You can check it out here. Happy reading - hope you enjoy it as much as we did!
In case you missed it, Kimberley A. Strassel details trial lawyers’ attempts to use a controversial case to block mandatory arbitration clauses (The Senate’s Lawsuit Factory, The Wall Street Journal, 7/22/11). Some how-to highlights:
1) Identify a law or regulation that prevents trial lawyers from cashing in.
2) Identify a "victim" of this law or regulation.
3) Get congressional allies to turn said victim into a cause célèbre.
4) Use ensuing moral outrage to get the law or regulation changed.
5) Buy a yacht.
A lot of tort reform –inspiring activity has been taking place across in New York these days.
First, there is judge-directed negotiation, an approach to resolving medical malpractice cases without the years of traditional legal overhead. As part of President Obama’s pledge to address skyrocketing medical malpractice litigation costs, New York City received a federal grant for a type of mediation between a trained judge and attorneys for each side. Its intent is to get judges involved earlier and actively encourage settlements, which prompts quicker resolution and fewer years in an expensive limbo for the parties involved. There are no appeals, and the settlements are often a shadow of what a plaintiff might receive in court. A positive consequence is that lawyers may become more hesitant to pursue a case that is marginal. A negative consequence, however, is that doctors may still feel pressured to settle, even when they haven’t been negligent.
Next, the New York State Assembly passed A-694, a complex piece of legislation supported by trial lawyers. It seeks to overturn the New York Court of Appeals’ decision in the case of Arons v. Jutkowitz. If enacted, opponents say, the cost of medical malpractice insurance will likely increase for New York’s physicians. More information about the legislation can be found here.
The last is sobering. New York City doled out an astounding $521 million in personal injury and property damage lawsuits in 2010. It’s sort of like a $57.88 lawsuit insurance policy for each of the city’s 9 million residents. And this figure is seven percent lower than it was in 2009!
The cost of healthcare is a hot topic in New Jersey. States that enacted non-economic malpractice caps saw a 3 – 4 percent decrease in healthcare costs over the last few years, according to the Agency for Healthcare Quality and Research.
Why does tort reform reduce the cost of healthcare? For starters, it lessens the needs for defensive medicine. Unnecessary tests can be both costly and time-consuming, and the patient isn’t any healthier for it.
With a looming physician shortage, perhaps it’s time for New Jersey to take a look at these cost-cutting measures. A poll conducted by the American College of Emergency Physicians (ACEP) recently found that more than half of emergency room doctors cite their fear of being sued as the primary reason for ordering unnecessary tests in the ER. Emergency room doctors may be particularly vulnerable to lawsuits, because patients are generally sicker and they often don’t have access to patients’ medical histories.
Post-reform, Texas emergency rooms have undergone the second biggest improvement in wait times in the nation. And that’s not it for the Lone Star State. Texans -who faced a physician shortage not unlike the one New Jersey will likely face- have added at least one emergency room physician in 33 rural counties, 24 of which previously had none.
That’s not just stopping the hemorrhaging: it’s a reversal. One that New Jersey patients could benefit from, too – expanding access to care is a welcome consequence of enacting tort reform.
Obese women aren’t always treated kindly by society. And now, some OB-GYNs in Florida say they simply can’t risk treating them – at all.
"People don't realize the risk we're taking by taking care of these patients," said Dr. Albert Triana. "There's more risk of something going wrong and more risk of getting sued."
The Sun-Sentinel polled 105 OB-GYNs in South Florida. Fifteen of them said they refuse otherwise healthy new patients over 200 pounds.
Doctors can decline patients for any reason. But when fourteen percent of OB-GYNs won’t see obese patients because the financial risk is too high, we could be seeing the dawn of a disturbing public health trend.
According to the Los Angeles Times, which also reported on the study, South Florida OB-GYNs have “long complained of high numbers of lawsuits after difficult births and high rates for medical malpractice insurance.” Obese women who were pregnant were somewhat routinely referred to specialists, but turning down obese women who are not pregnant is new. According to doctors interviewed, obese patients present an increased risk of complications – and are increasingly seen as potential lawsuit.
We have enough barriers between women and gynecological and prenatal care in the United States. It would be great if the trial lawyers, with their self-proclaimed concern for the average person, would stop adding to these barriers and support medical malpractice reform instead.
Chief Executive Magazine released its 2011 survey of the worst states for business. Unsurprisingly, Texas is ranked best, and New Jersey, New York, Illinois and California are the bottom four. New Jersey held steady at #47 for the third consecutive year.
It will also come as no surprise that many states in the top 10 continue to address civil justice reform issues (beneficial reforms are under legislative consideration in 5 of the top 10 states).
You can read Chief Executive Magazine’s full article and methodology here, or click on the map below for an interactive map of the best and worst states for business.
New Jersey’s Consumer Fraud Act is among a minority states which allow “litigation tourism” – that is, permitting non-New Jersey residents to sue under the Act. And because New Jersey’s CFA is so broadly constructed, many out-of-staters and their attorneys are eager to jump on the class-action bandwagon.
Case in point:
Apr 26, 2011 5:17 PM | Via Consumer Reports
Describing the smell of some batches of Benjamin Moore’s Natura paint as “horrid,” two law firms filed suit against the paint maker today on behalf of a woman who claims she had to move out of her home because the odor was so strong. Filed in the U.S. District Court of New Jersey, the complaint initiates a class action suit, according to Lexington Law and Scott + Scott LLP.
According to court papers, Marlene Sway, the plaintiff, painted several rooms in her California home with Natura paint in 2009. Soon after she noticed a foul odor and areas where the paint failed to dry, according to the complaint. She eventually moved out.
Moral of the story? Lawyers love to file lawsuits under New Jersey's Consumer Fraud Act, especially when they stink.
“New Jersey is, in many ways, ground zero for mass tort in the US, with the majority of major drugmakers headquartered in the state.”
That’s where the accord stops. We celebrate the jobs, innovation, and life-saving drugs that our nation’s “Medicine Chest” generates. Trial lawyers are celebrating Accutane lawsuits, 3,100 strong, which were consolidated in Atlantic County Superior Court.
We’ve written about the popular acne drug Accutane extensively. It’s now off the market, due in large part to the cost of the settlements its manufacturer has had to pay.
Calling our state’s largest industry “ground zero for mass tort” isn’t exactly the encouragement New Jersey business owners and entrepreneurs need during these economic times. But to the detriment of everyone else, the only industry the trial bar is concerned with seems to be ‘litigation tourism.’
Last month, we underscored Governor Christie’s pitch to attract Illinois businesses in an op-ed. New Jersey’s “well-educated, diverse talent pool” and “innovative financing, incentive, and assistance programs” for new businesses is ideal for entrepreneurship – especially to a state which raised its corporate tax rate from 4.8 to 7 percent.
The CEO of one business, however, recently told Illinois Governor Pat Quinn that his business would stay – but that the state’s business climate needs to change.
Doug Oberhelman, CEO of Caterpillar Inc., which manufactures heavy equipment in the Peoria area, employs 23,000 people. Governor Quinn reportedly acknowledged that the state’s business image is in need of an overhaul.
Illinois ranked eighth in the region in job growth as a percentage of its population last year, according to Chicago Business. To the chagrin of Caterpillar’s overseas representatives, personal income tax also rose, from 3 percent to 5 percent. They expressed concern about the company’s ability to attract engineers, and reiterated that even if Governor Quinn’s call for a 30 percent reduction in businesses’ liability for workers compensation is enacted, Illinois would still have the 2nd highest rates in the nation. Illinois businesses also want to see a cap on civil liability.
Governor Quinn also told Oberhelman that he plans to invest in Illinois’s infrastructure and help manufacturing companies improve their ability to export. Let’s hope that that Illinois trial lawyers don’t take it as a green light to invest in workers compensation lawsuits in the meantime.
Excerpt: WASHINGTON — Can a class-action lawsuit be too sprawling to deliver old-fashioned justice?
Justice Antonin Scalia seems to think so, judging by his comments on Tuesday during the Supreme Court argument in the biggest employment discrimination class action in history.
“We must have a pretty bad judicial system,” he said, reflecting on what he had just heard from a lawyer for hundreds of thousands of women suing Wal-Mart over what they say was unfair treatment on pay and promotions. The lawyer had said that a trial judge could rely on statistical formulas rather than testimony and personnel records to decide how much money the company would have to pay each plaintiff if it lost.
“Is this really due process?” Justice Scalia asked.
In other words, does the impersonality of the suit threaten its ability to be fair to each plaintiff and to Wal-Mart, the country’s biggest private employer?
By Marcus Rayner | March 29, 2011
“From a college student suing a Chinese restaurant for soup she spilled on herself (Somerset County), to a drunken motorcyclist who drives into a parked car and sues a restaurant (Ocean County), lawsuit abuse has an economic impact on businesses in every corner of the state. Every dollar spent fighting nonsense lawsuits is a dollar not spent on innovation or job creation, and it doesn't need to be this way.”
Several hundred miles from here, Illinois business owners are learning about a place with an abundant supply of workplace talent and a high-quality lifestyle sure to make any entrepreneur envious. Weary from crippling tax hikes, a labor shortage and a shrinking consumer base, Illinois business owners can only dream about this land of milk and honey: New Jersey.
"Well-educated, diverse talent pool," reads the ad, placed by New Jersey Gov. Chris Christie. Want to start a business? "Innovative financing, incentive and assistance programs. Exceptional quality of life."
The catch? Here in New Jersey, businesses are vulnerable to lawsuit abuse. Everything the ad says about New Jersey is true. Christie's efforts to improve the business climate in New Jersey, combined with our state's existing assets make New Jersey fertile grounds for entrepreneurship. His outreach to the national business community is both constructive and sorely needed as we seek to reclaim our economic footing here in New Jersey. And business retention as well as recruitment will be critical to our economic growth over the next decade, a point that leaders in both political parties have made.
Can you imagine agreeing to a loan on which you would have to pay over 36 percent in interest?
Of course not, because it would be absurd unless you were really desperate.
Many states cap the interest rate a lender can charge its customers. In Indiana, for example, it’s capped at 36 percent – still a generous deal for the lender, but protects the borrower from being taken advantage of, and having to pay back much more than their loan is worth.
One group says a 36 percent interest rate is not high enough – and that they should be exempt from state lending laws. Meet the personal injury lawyers.
Some companies are in the business of advancing money to would-be plaintiffs involved in personal injury lawsuits. According to a New York Times report by Binyamin Appelbaum, there are about a dozen such companies nationwide, and several smaller companies. They collectively lend plaintiffs $100 million per year in increments of a few thousand dollars to cover their housing and medical expenses. Plaintiffs pay back their loans plus interest after lawyers win their case. If the lawyers lose, they owe nothing. The message seems to be that filing a frivolous lawsuit can be a pretty good investment.
Personal injury lawyers say that’s why they should be excluded from states’ loan caps: these aren’t loans – they’re investments. And they’re taking their show on the road to Legislatures across the country. Oasis Legal Finance in Illinois recently proposed exempting lawsuit lending companies from Indiana’s 36 percent cap on interest. Senator Randy Head said that Oasis’s advocacy first brought his attention to the issue, which resulted in his introduction of Senate bill 97. It included a modest restraint on lenders by preventing them from providing anything beyond money to plaintiffs, as well as assertions from the industry that they were attempting to self-regulate in the name of consumer protection. It was that portion that helped to carefully pitch it to the state Senate as a pseudo-reform bill and ultimately led to that chamber’s passage of it last month, with a vote of 36 – 14.
“Most of what they proposed is contained in the bill,” the sponsor acknowledged to the New York Times.
While “lawsuit lending” might help one who is truly besieged with medical bills and unable to work due to someone’s negligence as their case is being sorted out, it’s hard to deny that it also gives plaintiffs and their attorneys a hefty incentive to pursue the largest financial rewards possible.
The personal injury lawyers’ trade group is trying to carve themselves out of regulation through the legislative process in Alabama, Kentucky, and Maryland as well, and may be focusing on Arkansas and Nevada in the near future. The watchful eye of the chambers of commerce has kept efforts at bay in Kentucky, which have successfully blocked similar legislation from passing the state Senate. And since all of these bills were introduced in February 2011 or later, we may only have seen the tip of the iceberg in trial lawyer lobbying.
Nearly every state in the country is grappling with rising Medicaid costs. New York, however, bears the distinction of having the highest Medicaid costs in the nation, and also leads among avoidable hospital use and costs. On a per capita basis, it runs about twice the cost of the national average.
To help his “functionally bankrupt” state cleanse its Medicaid program of inefficiencies and waste, Governor Andrew Cuomo convened a Medicaid Redesign task force to “redesign and restructure” the program.
The task force consisted of 30 stakeholders – doctors, hospitals, nursing homes, the Greater New York Hospital Association, and other patient care providers you would expect. The objective, according to the Syracuse Post-Standard, is to move nearly all of the state’s 4.7 million Medicaid recipients to managed care within the next three years in order to stop the use of hospital emergency rooms for preventative and routine care. Its expected savings could exceed $1.1 billion. The task force issued 79 recommendations last Thursday for the approval of the Governor and Legislature. And they include a $250,000 cap on noneconomic damages – which would save hospitals hundreds of millions of dollars in insurance premiums alone.
Now enter the trial lawyers. They’re throwing a fit over aforementioned recommendation. Not because it saves taxpayers’ money, but because their interests weren’t represented on the task force. New York Times blogger Nicholas Confessore has noted their frustrations in detail.
New York State faces a $10 billion deficit, and Governor Cuomo has said he needs to cut Medicaid spending by $2.85 billion and limit it to 4 percent annual increases thereafter if he has any chance of plugging it. Josh Vlasto, a spokesperson for Governor Cuomo, called the interest group opposing this recommendation a “mouthpiece for the trial lawyers.”
I suppose the task force could have recommended cuts in patient spending instead of a cap on litigation and insurance spending. As a patient, however, wouldn’t you rather have a $250,000 cap on noneconomic damages instead of a reduction in care? It seems nonsensical and transparent for trial lawyers to insist that the only way Medicaid recipients can receive more efficient care is to make sure the lawyers’ thirst for uncapped noneconomic medical damages remains quenched.
ABC’s Elizabeth Leamy reports on the spike in suspicious slip and fall claims. Some of what the camera catches is amazing – from a man who buys a hot dog, then places it in a store isle so his accomplice can intentionally slip, to a woman who fixes her hair before lying down in artificial distress.
The National Insurance Crime Bureau says that “suspicious claims” are up 24 percent from 2008.
Leem notes this number could be even higher, because many businesses quietly pay off these claims to make them go away. Even when fake falls are caught on tape, “fake slip and falls still have the effect of driving up prices for all of us,” she says.
Jim Quiggle of the Coalition Against Insurance Fraud says that indeed, “some people fake slip and falls for a living.”
Tort reformers in all three states had significant victories this week.
In North Carolina, S-33 would cap noneconomic awards in malpractice cases at $100,000. It was advancing to the full Senate for a vote as of Thursday.
A similar piece of legislation passed the full Senate in Oklahoma. S-863 would cap noneconomic damages at $250,000.
Meanwhile, in North Dakota, progress was made in the judicial branch. A group of thirteen out-of-state plaintiffs had filed a product liability suit in North Dakota, which has one of the longest statutes of limitation in the country. The state Supreme Court ruled in favor of the defendant in Vicknair v. Phelps Dodge. Several groups, including NFIB and the U.S. Chamber of Commerce, argued that the statute of limitations from the plaintiffs’ home states should be applied, not the more plaintiff-friendly statute of limitations in North Dakota.
Trial lawyers need a new hobby / Marcus Rayner
New Jersey earned its reputation as the nation’s “medicine chest” many years ago. If you live here, chances are good that you know someone who is employed directly by a pharmaceutical company or indirectly through service contracts.
Read entire letter on the NJBIZ website.
NJLRA’s former chair, Taysen Van Itallie, underscores just how serious New Jersey’s “Sue Me” image has gotten in the New Jersey Law Journal.
New Jersey had 10,579 new civil cases in 2008 – more than twice as many filed in Illinois, a state with a larger population.
It begs the question: how exactly can we make our state more attractive to businesses without addressing the tort situation?
“Businesses of all sizes are sensitive to a state’s lawsuit climate. Let’s be sure we have a plan to improve ours,” writes Van Itallie.
You can read his entire op-ed in the New Jersey Law Journal here.
A new bipartisan issue caucus in Congress was announced today- the Congressional Civil Justice Caucus, which will focus on legal reform issues. NJLRA is excited, to say the least.
I applaud Congressmen Bob Goodlatte (R-VA) and Dan Boren (D-OK) for taking the lead on this issue at the Congressional level. It’s helpful to have a bipartisan caucus focus on advancing a civil justice system conducive to the United States’ global economic competitiveness.
Here in New Jersey - a state where consumers have neither an obligation to ask for a refund before taking a business to court, nor to have encountered actual fraud in order to sue under the state Consumer Fraud Act - the Caucus carries a special significance for us. It shows the hardworking men and women of our state that members of Congress are willing to carry our fight against lawsuit abuse to the highest levels of government. Knowing that we have support as we try to stop the hemorrhaging of our key industries is invaluable.
Most importantly, the Congressional Civil Justice Caucus gives us the opportunity to expose the target that the pharmaceutical industry has on its back in our state. In the last year New Jersey shed 7.6 percent of its pharmaceutical jobs, due in part to litigation tourism by the trial bar. Instead of the nation’s “Medicine Chest,” we are becoming a national leader in pharmaceutical job exportation.
Ninety-three percent (93%) of the mass tort plaintiffs in New Jersey suing our pharmaceutical companies are out-of-state residents seeking the use of our plaintiff-friendly laws. This is an unacceptable situation we must correct in order to achieve solid economic growth. I am hopeful that the Caucus will push for reforms similar to A-3333, sponsored by Assemblyman John McKeon (D-Essex) in states where the Consumer Fraud Act encourages abuse.
New Jersey is quickly losing ground to other states which have enacted common sense tort reform measures. I encourage all members of New Jersey’s congressional delegation to support the Civil Justice Caucus and participate in this bipartisan forum.
We’re paying for lawsuits. Lots of them.
The Louisiana Lawsuit Abuse Watch (LLAW) released a study which found that eight of the state’s municipalities spent a collective $52 million fighting lawsuits between 2006 and 2009. $37 million was spent in the form of judgments and settlements; $14.9 went to outside counsel.
That’s $52 million. In eight towns. In just three years!
You may recall a Lawsuit Reform Watch post from April 2010, in which the cash-strapped city of Irvington, New Jersey, faced the loss of 20 police officers and 10 firefighters to help close a $5 million budget shortfall. This announcement from Mayor Wayne Smith came days before an appellate court rejected the city’s attempt to have its insurance company cover a $5 million personal injury suit.
Melissa Landry, executive director of LLAW, acknowledged that some lawsuits are legitimate, but that some “are filed purely in search of enrichment from the lawsuit lottery. At a time when Louisiana, like most other states, are struggling, the public’s financial resources could have made an impact elsewhere: preserving the jobs of law enforcement personnel.
President Obama’s State of the Union address touched on two areas of interest to NJLRA supporters: medical malpractice reform and a flaw in the healthcare reform bill which requires all businesses to track expenditures to all vendors.
Frivolous medical malpractice lawsuits affect the ever-increasing insurance premiums each doctor must carry, and these costs can vary significantly by specialty and by state. In New Jersey, the medical malpractice crisis has lead to a homegrown healthcare crisis of our own, in which we are seeing fewer doctors willing to practice specialized medicine within the jurisdictions of the Garden State.
Beginning January 1, 2012, all businesses would need to track expenditures over $600 with other vendors, and prepare a Form 1099. This requires tracking down the taxpayer ID for each vendor as well. This would be an especially difficult for small businesses, which lack the accounting resources of larger companies. Fortunately, President Obama acknowledged the onerous burden this portion of the healthcare bill would place on economic growth.
Excerpts from the President’s speech regarding medical malpractice and small business bookkeeping under the new healthcare law are quoted below:
“This means further reducing health care costs, including programs like Medicare and Medicaid, which are the single biggest contributor to our long-term deficit. Health insurance reform will slow these rising costs, which is part of why nonpartisan economists have said that repealing the health care law would add a quarter of a trillion dollars to our deficit. Still, I'm willing to look at other ideas to bring down costs, including one that Republicans suggested last year: medical malpractice reform to rein in frivolous lawsuits.”
Small business bookkeeping under the new healthcare law
“Now, I've heard rumors that a few of you have some concerns about the new health care law. So let me be the first to say that anything can be improved. If you have ideas about how to improve this law by making care better or more affordable, I am eager to work with you. We can start right now by correcting a flaw in the legislation that has placed an unnecessary bookkeeping burden on small businesses.”
Expert testimony, non-economic damage award limits, and product-liability are key reforms included in this proposal. You can learn more about Governor Walker’s pro-civil justice agenda here.