Unforeseen Consequence of Scientific Advancement?

Medical Devices Rendered Defective by a Computer Virus

May 12, 2009. By Gordon Gibb

Washington, DC: It reads like a sci-fi movie, but it is anything but entertaining. The advent of connecting medical devices to computers may, on the surface seem like a natural given modern-day interconnectivity. However, such computerization invites the potential for viruses for PCs directly connected to either the Internet or to a local area network (LAN)—and it has already happened. A defective medical device is created in the process.

According to a report from CBS News the Conficker Internet virus has infected important computerized medical devices.

Rodney Joffe is the senior vice president for Neustar and a founder of the Conficker Working Group. In recent weeks Joffe has told a panel at the House Energy and Commerce Committee that he, together with another Conficker researcher had identified at least 300 critical medical devices from a single manufacturer that had been infected with the Conficker virus.

According to the report, the devices in question were connected to a LAN and found at, or near intensive care (ICU) stations. These devices allowed doctors to view and manipulate MRI scans. The thought of such a device infected with a nasty computer virus more than just boggles the mind. It is unthinkable.

And yet it is happening and is poised to grow even bigger given the push to computerize hospital records and interconnect hospitals and doctor's offices.

Implantable medical devices such as heart defibrillators that allow doctors to adjust settings by way of computer are another worry. What if the computer is connected to the Internet? One would assume that such an integral piece of equipment would not be connected to the Internet for obvious reasons.

However, if the computer in question is part of a LAN where other computers in the building have Internet access then the defibrillator computer does, indeed have indirect Internet access.

Could the medical device be hacked from afar? And does that constitute a defective medical device, if the device can be accessed from afar?

Joffe told CBS News that the medical devices he found in the hospital setting "…should have never, ever been connected to the Internet."

Worse, he said were the government regulations that prevented the hospitals in question from fixing the problems in a timely manner. Under current regulations, affected hospitals would have to wait 90 days before the systems could be modified to facilitate the removal of the infections, together with other vulnerabilities.

That's 3 months. Three months that the hospital would either have to do without the equipment (and anything connected to it via a LAN network), or continue using the equipment knowing that it has been compromised in some fashion.

"The open Internet, one of its great values is it allows you to connect fairly cheaply and fairly easily to other computers," Joffe said. He added, however, that "the Internet was never designed to do the things it's doing today."

In an unrelated but equally troublesome issue, it was revealed that Chinese and Russian spies had infiltrated US electrical grids. The so-called 'smart grids,' which interconnect many of the nation's utility grids via the Internet, are open to any hacker who can get around whatever protections have been built into them.

The Homeland Security Department was recently given Congressional authority to exercise greater influence over public utilities in order to mitigate potential hacks into the smart grid system.

The concern has even greater import within the health care field. The widespread move to electronic record-keeping and the computerization of all things medical—including medical devices—poses an even bigger question: how secure are these networks and systems from unsavory hackers, and what does that mean to an individual now walking down the street with a potential computer virus in his pacemaker?

A computer virus could make an otherwise viable medical device—a defective medical device. It has been known since last year that pacemakers and defibrillators can be hacked. Similarly, it was discovered in 2003 that signals from GSM phones could interfere with pacemakers. A study published that year in Physics in Medicine and Biology found that some pacemakers were prone to confusing signals from mobile phones for the heart's own electrical signals, causing the pacemakers to fail.

At the time, it was determined that the addition of a ceramic filter would resolve the defective medical device problem. What could be brought to bear to protect medical devices of all stripes from computer viruses given the tremendous interconnectivity prevalent today is another matter.

Let's Debunk a Few Myths About the Legal System

Don't always believe what you hear. The number of lawsuits is down, and has been for years, and there is a move afoot to keep you out of court at all costs - Bobby

Debunking Some Myths About Lawsuits and Tort Reform

March 19, 2009

Myth: The number of lawsuits filed is skyrocketing.

Not true. According to the Justice Department under President George W. Bush, the number of federal tort (personal injury) cases resolved in U.S. District Courts fell by 79 percent between 1985 and 2003. In 1985, 3,600 tort trials were decided by a judge or jury in U.S. District Courts. By 2003, that number had dropped to less than 800.¹

Additionally, the most recent statistics from the Administration’s Bureau of Justice Statistics show the number of tort trials at the state level has decreased. These statistics were compiled as part of the Bureau’s survey of state civil justice systems in the nation’s largest 75 counties. Among these counties, the number of tort trials decreased 31.8 percent between 1992 and 2001. ²

Myth: Health care costs are rising and doctors are unable to practice due to litigation.

Health care costs are rising; however, medical malpractice litigation has nothing to do with it. According to the Congressional Budget Office, medical malpractice amounted to less than 2 percent of overall health care spending.³ The Government Accountability Office also found that malpractice cases have not widely affected access to health care. ⁴

According to the American Medical Association, the overall number of physicians is up more than 40 percent since 1990⁵, while over the same time, the U.S. population increased by only 18 percent .⁶ The number of emergency physicians, neurosurgeons, and OB/GYNs has also increased significantly over the same time period.

Myth: Legal reform is needed because lawsuits hurt small businesses.

Wrong. Multiple surveys have shown that lawsuits are not a concern for small business owners. A survey from the National Association of Manufacturers suggests that “lawsuit abuse” ranks at the bottom of concerns for manufacturers.⁷ A 2008 survey from National Federation of Independent Business had similar results, with “costs and frequency of lawsuits / threatened suits” ranking 65th on a list of small business owners’ worries. ⁸

In reality, only big corporations and their front groups want to destroy the legal system so they can’t be held accountable for negligence and misconduct. Drug, oil, and insurance companies have tried to hide behind small business owners to accomplish this; however, these surveys reveal their true intentions.

Myth: Trial attorneys are trying to drive corporations out of business.

Absolutely not. Corporations, large and small, are all entitled to have profitable businesses. Most do so without being negligent or engaging in misconduct.

A strong civil justice system allows deserving individuals to get justice and hold wrongdoers accountable. Civil justice attorneys work to make sure all people have a fair chance through the legal system – even when it means taking on the most powerful corporations.

Myth: Lawsuits are out of control. Someone even sued because they spilled hot coffee on their lap!

Those looking to destroy the civil justice have continually mocked Stella Liebeck and the McDonald’s coffee case. Unfortunately, the actual facts of this case make it no laughing matter.

Ms. Liebeck’s injuries include third degree burns—the most severe—to her groin, inner thighs, and buttocks. She was hospitalized for eight days, during which time she underwent skin grafting and debridement treatments (the surgical removal of tissue).

Ms. Liebeck sought to settle her claim with McDonald’s for $20,000, but they refused. McDonald’s eventually produced documents showing more than 700 claims by people burned by its coffee between 1982 and 1993, some involving third degree burns similar to Ms. Liebeck. This history documented McDonald’s knowledge about the extent and nature of this hazard. McDonald’s own quality assurance manager testified that a burn hazard exists with any food served above 140 degrees; their coffee was kept warm at 185 degrees.

A jury awarded Ms. Liebeck $200,000 in compensatory damages, but reduced it to $160,000 because they found her 20 percent at fault for the spill. The jury also awarded her $2.7 million in punitive damages, equal to two days of McDonald’s coffee sales. This was eventually reduced to $480,000, even though the judge called McDonald’s conduct reckless, callous, and willful. Jurors expressed similar sentiments in interviews after the trial. Ms. Liebeck and McDonald’s eventually entered a post-verdict settlement.

Myth: Trial attorneys are charging outrageous hourly fees and leave victims with nothing if they win.

Civil justice attorneys do not charge by the hour like most other attorneys. Instead, their clients pay on what is called a “contingency fee basis.”

For over 200 years the contingency fee system has provided Americans who must go to court with a degree of access to justice that is unheard of in most other countries. Our system allows people who cannot afford to pay legal fees to obtain representation on a contingency fee basis. In personal injury and death cases, and in certain other types of litigation, the fee is based on a percentage of any money damages that are recovered.

Myth: My insurance rates are skyrocketing because of lawsuits.

Your insurance premiums may be going up, but it has nothing to do with lawsuits. Look no further than the insurance industry’s annual profit reporting. In 2007, insurance companies reported a near-record profit of $61.9 billion. In comparison, the insurance industry’s 2004 profit was $38.7 billion, which broke all previous records. Their profits continue to rise, and unfortunately, your premiums are following suit.

The insurance industry has also made the argument that awards and damages should be limited; however, have later admitted that caps will not lower premiums. For example, American Insurance Association spokesman Dennis Kelly told the Chicago Tribune in 2005 that, “We have not promised price reductions with tort reform.”

Myth: Lawsuits cost taxpayers X hundreds of dollars each year.

Several so-called “independent” think tanks or organizations have devised the notion that American families pay a yearly “tort tax,” or that the cost of litigation is passed on to taxpayers. These organizations, funded by oil, drug, tobacco, and insurance companies, produce studies that are a prime example of junk science. There is no methodology or academic basis for their results. Trying to pass off these organizations and their studies as legitimate is yet another scheme by corporations to avoid accountability in the courtroom and stack the deck against every day Americans.

Myth: Schools are cancelling recess because they are afraid of litigation.

Wrong. School districts across the country are almost universal in blaming the elimination of recess on the need to meet requirements for teaching and testing hours.⁹

Myth: People aren’t volunteering to help with Little League, Boy / Girl Scouts, etc., because they are afraid of lawsuits.

Wrong again. Similar to the previous myth, these lies are peddled by groups interested in destroying the civil justice system.

The Volunteer Protection Act of 1997 was passed to provide immunity for volunteers of nonprofits in the course of their charity work.

Sources:

1. "Federal Tort Trials and Verdicts, 2002-03”, Bureau of Justice Statistics, 8/17/05

2. "Civil Trial Cases and Verdicts in Large Counties, 2001”, Bureau of Justice Statistics, 4/04

3. "Congressional Budget Office, “Limiting Tort Liability for Medical Malpractice,” 1/08/04

4. “Medical Malpractice: Implications of Rising Premiums on Access to Health Care,” GAO, 9/29/03, www.gao.gov/cgi-bin/getrpt?GAO-03-836

5. “Physician Characteristics and Distribution in the U.S.,” American Medical Association, 2006 edition, p.312

6. U.S. Census Bureau data: http://factfinder.census.gov/servlet/SAFFPopulation?_submenuId=population_0&_sse=on; http://factfinder.census.gov/servlet/DTTable?_bm=y&-geo_id=01000US&-ds_name=PEP_2005_EST&-mt_name=PEP_2005_EST_G2005_T001

7. “National Manufacturing Week 2006 Annual Survey Results,” National Association of Manufacturers, http://www.nam.org/s_nam/doc1.asp?CID=6&DID=236617

8. “Small Business Problems and Priorities,” National Federation of Independent Business, http://www.nfib.com/object/2008problemspriorities.html

9. http://www.washingtonpost.com/wp-dyn/content/article/2006/05/31/AR2006053101949_pf.html;
http://seattlepi.nwsource.com/local/191407_recess18.html; http://online.wsj.com/public/article/SB116044203663787613-OWTfLOXAilkTcNPcqP3tS75OWcE_20061108.html?mod=tff_main_tff_top

Increase Your UM/UIM Coverage

Increase Your UM/UIM Coverage!
Bobby Lott

Due to the troubled economy, chances are there will be more and more uninsured and underinsured motorists on our highways.

Most if not all states now require drivers to carry liability insurance, but despite that fact, many do not comply.

Normally UM/UIM coverage must be in your policy unless you opt out in writing.

To protect yourself and your family, you should get with your insurance agent and increase your uninsured (UM) and underinsured (UIM) motorist coverage.

You can typically carry an amount equal to, but not greater than, the amount of your liability coverage.

So if your liability coverage is 100/300, which is common ( $100,000 for each person, $300,000 for the entire accident) , you can carry up to $100,000 in UM/UIM coverage.

The cost for this extra coverage is minimal compared to other insurance.

This is especially important if you have no health insurance. If that were case, and you were injured, you would have no other source for big medical payments but your auto policy's medpay and UM/UIM coverage.

Are These the Real Bad Guys?

Ratings Agencies Next on the Chopping Block?
Bobby Lott

Most people have heard of Standard & Poors, Moody's, and perhaps Fitch. They are the so-called "ratings agencies". It is the job of rating agencies to provide investors with reliable, accurate and unbiased information on the financial state of an organization.

Now, there is a growing movement among attorneys and industry professionals that it was the rating agencies and the conspiracy between them and the banks that caused this $7 trillion collapse of the world economy.

How?

In a Congressional hearing in October of 2008, testimony confirms, according to some, that the rating agencies were in essence acting as consultants and being paid hundreds of millions of dollars to put inflated or deceptive ratings on credit default obligations. Allegedly, both the banks, and the ratings agencies knew these things were "absolutely toxic."

If these allegations are true, that would constitute a clear conflict of interest, since the ratings agencies are charged with being an independent source of information used by investors worldwide. For them to be paid by the companies issuing the securities would be almost certainly fraudulent and actionable.

The big question remaining is - what happened to the money?

More to come.

Beware of Loan Modification Scams

IN THESE troubled economic times, the financial vultures have started appearing.

More and more, so called "loan modification" or "loan-mod" companies are springing up like weeds, with promises of loan forgiveness, easier payments, or a "little known government program."

Most are scams, pure and simple.

If someone is already in foreclosure, the only person who can help is an attorney, and even their help is limited to state and federal law.

If someone is simply behind in payments, or even if they aren't but simply want to refinance at a better rate, they don't need to hire a loan modification company to do so.

One can simply contact the mortgage company, bank or other financial institution that holds the mortage on your home and deal with them directly.

That is all the loan mod company would do anyway, but they would charge you a fee from $500 to $5000 to do so.

I am currently looking at filing suit on behalf of a client who fell prey to one of these boiler room type operators. I will keep you posted on the progress.

These types of companies are most prevalent in California, Arizona and Florida, but are becoming more and more prevalent all across the country.

If you are tempted to pay someone a fee for helping you modify your loan terms, think twice, then call an attorney who is well versed in this area of the law.

You will thank yourself later.

HOW TO PROTECT YOUR PROPERTY IF THERE IS A "NATIONAL EMERGENCY"

If the new President were to suddenly declare a National Emergency or institutes martial law, what would that mean for you and your assets?

If you say nothing, you may be sadly mistaken. In today's political climate, almost nothing is beyond the reach of our overactive and overprotective federal government.

Below are suggestions to protect you, your business and your family.* (Even without an "emergency", these are still effective strategies)

If you have property that you believe may be at risk for some future expansion of emergency or wartime controls, you still may legally take action to protect it. Here are some ideas:

• Transfer funds outside the United States and outside the U.S. dollar. It's still possible to legally transfer funds from the United States, but it may not be if the U.S. imposes foreign exchange controls. This could occur in the event of another terrorist attack on the United States, or if the U.S. dollar falls sharply due to a terrorist incident or financial panic. That possibility may seem remote at the moment, because the U.S. dollar has appreciated sharply in the last few weeks in response to the global economic crisis. But this gives U.S. investors a rare opportunity to invest offshore and convert their dollars to foreign currencies, or to gold, at the most attractive exchange rates in more than a year.
• Use offshore structures to hold non-U.S. investments. This strategy may not only provide protection against domestic judgments, but may also provide a legal means to avoid future foreign exchange controls.
• Hold investments that aren't subject to U.S. jurisdiction. The most vulnerable investments are those located within the United States. But as this report documents, foreign investments may also be vulnerable, particularly those denominated in U.S. dollars. The least vulnerable foreign investments are foreign real estate and gold, silver or collectibles held outside the United States. Certain contractual relationships, such as insurance contracts and trusts, may also be configured to avoid U.S. jurisdiction.
• Avoid electronic transactions in U.S. dollars through U.S. clearing networks. Most electronic transfers of U.S. dollars clear through a U.S. clearing bank and ultimately the Federal Reserve. U.S. courts have ruled that funds involved in such transactions are subject to U.S. jurisdiction and thus to possible confiscation. A growing number of countries have set up dollar clearing facilities to clear their own domestic U.S. dollar electronic transactions. Such foreign clearing networks are at far less risk from the U.S. legal system than U.S. clearing networks.
• If you’re a foreign investor with U.S. interests, assess your risk to U.S. emergency or war controls. Investors from any country accused of "sympathizing with" or "harboring" terrorists are at particular risk. So are investors in countries or financial institutions through which terrorists have been accused of operating bank and trust accounts.
• U.S. persons not wishing to live under emergency controls are understandably interested in relocating to lower profile jurisdictions. Many countries welcome affluent retirees or other financially self-sufficient persons.

The idea that the President would impose monetary controls might seem remote, but they’ve been imposed many times in U.S. history. And, as this financial crisis deepens, they may be imposed once again, so prepare yourself.

*Be sure to consult an attorney or financial professional before attempting to structure an offshore account or other specialized structure, since there can be significant tax consequences to improperly setting one up.

Setting Up A " Series LLC"

When One is Better Than Many: The Series LLC

by Jay Adkisson and Chris Riser

Segregating “dangerous” assets and businesses into separate entities away from other assets, especially “safe” assets, is always a good idea from an asset protection point of view. For example, an individual who owns a gas station and a rental home should not own both within the same entity. Further, an individual with a large amount of liquid assets (cash, securities, etc.) to protect should not hold those assets in the same entity as a business.

Best practices would dictate that every distinct business or major business asset be segregated into a different limited liability entity. In an ideal situation, someone with 25 rental properties would have 25 separate LLCs, one for each property. However, this is not always practical because of administrative costs and government fees that must be paid for each LLC. What can such a business owner do to protect his assets from liabilities unrelated to those assets in a cost-effective way?

Enter the series LLC. The LLC acts of Delaware, Iowa and Oklahoma provide for the creation of separate protected “cells” (‘series’) within one limited liability “container” (the series LLC) without the need to create separate entities, thus avoiding the inefficiencies associated with multiple related entities. [1] The Delaware LLC Act is the LLC act most often used for series LLCs and is the act used for discussion purposes in this article.

The Delaware LLC Act provides that the liabilities of a particular series are enforceable only against the assets of that series. The Act also provides that classes or groups of members can be established, having whatever rights the LLC agreement says they have.

The combination of these two provisions allows a series to function in many ways as a separate entity for practical purposes. The series LLC concept is similar in function to segregated portfolio companies and protected cell companies designed for the mutual fund and captive insurance industries in a number of offshore and onshore jurisdictions.

Be Careful with Ads Touting "Offers In Compromise"

Check Carefully Before Applying for Offers in Compromise

WASHINGTON — The Internal Revenue Service today issued a consumer alert advising taxpayers to beware of promoters’ claims that tax debts can be settled for “pennies on the dollar” through the Offer in Compromise Program. Some promoters are inappropriately advising indebted taxpayers to file an Offer in Compromise (OIC) application with the IRS. This bad advice costs taxpayers money and time. An Offer In Compromise is an agreement between a taxpayer and the IRS that resolves the taxpayer's tax debt. The IRS has the authority to settle, or "compromise," federal tax liabilities by accepting less than full payment under certain circumstances. “This program serves an important purpose for a select group of taxpayers. But we are increasingly concerned about unscrupulous promoters charging excessive fees to taxpayers who have no chance of meeting the program’s requirements,” said IRS Commissioner Mark W. Everson. “We urge taxpayers not to be duped by high-priced promises.” The OIC may be considered only after other payment options have been exhausted. If taxpayers are unable to pay their taxes in full, there are other payment options, such as monthly installment agreements, that must be explored before an OIC can be submitted. The IRS.gov Web site contains complete information on the collection process and payment options. Publication 594, The IRS Collection Process, also provides helpful information on the options available to taxpayers. Taxpayers also should review Form 656, Offer In Compromise, or Form 9465, Installment Agreement Request, to determine if they qualify for either payment program. Form 656 provides detailed instructions for submitting an offer and includes all of the necessary financial forms. Some taxpayers may be exempt from the $150 OIC fee depending on income or whether the OIC is based solely on doubt as to tax liability. Taxpayers who claim the poverty guideline exception must certify their eligibility using Form 656-A, Income Certification for Offer in Compromise Application Fee. The poverty guideline exception applies only to individuals. All publications and forms are available at IRS.gov or taxpayers may order copies by calling 1-800-829-3676. All publications and forms are available free. Taxpayers may feel they need the assistance of a qualified tax professional to prepare and submit an OIC. Taxpayers may contact local or state tax professional associations for enrolled agents, CPAs or attorneys to locate someone in their geographic area that has the education and experience to assist them.

Stay Away from Chantix

Tempe, AZ: Cindy B. had been smoking for 25 years when she decided it was time to quit. Unfortunately, she was given Chantix and suffered serious side effects. However, it was not until she read an article about Chantix that she realized her side effects were related to the smoking-cessation drug.

Among Cindy's side effects were depression, sleeplessness, nausea and vomiting. She says the side effects started within two months of taking Chantix. "It started with depression and it progressed," Cindy says. "Then there was sleeplessness that was overbearing. I just didn't sleep. I think that not sleeping made the depression worse."

Although Cindy says she did not specifically have suicidal thoughts, she did feel hopeless, no longer caring if she lived or died.

A month ago, she stopped taking Chantix after reading articles about what other people went through while on the drug. She gave her unused Chantix to her boyfriend, who threw it away. Since stopping the drug, she says her side effects have lessened.

"I'm happy to be home," Cindy says. "I'm happy to be with my dogs. I'm getting another job. There's a very big change. I just can't believe that they kept giving me Chantix in treatment. I didn't clue in that the Chantix was related to my side effects. It's like everybody in the medical community thinks that Chantix is just fine. These drugs shouldn't be mood altering, but they are. I lost my faith in doctors.

"Be extremely careful on Chantix. It hasn't been around that long and it's like you're an experiment when the medical community gives it to you. I would say that people should actually try to do a smoking detox on their own. Stay away from Chantix."

Cindy's comment that people are being used as experiments is actually quite accurate. An investigation by ABC News and The Washington Times has uncovered evidence that the VA is using soldiers diagnosed with Post Traumatic Stress Disorder to test Chantix. Despite knowing that Chantix is linked to suicidality and neurpsychiatric behavior, doctors did not warn study participants for three months about the risks. Participants were only warned after one veteran who was taking Chantix suffered a psychotic episode and had a violent incident with police.

Although news about the risks associated with Chantix was made public a few months ago, many people are just now discovering that their health problems, depression and suicidality may have been related to their use of the drug. In November 2007, the FDA issued a warning that patients taking Chantix may experience "suicidal thoughts, and aggressive and erratic behavior."

If you or someone you love has been harmed or suffered serious side effects while taking Chantix, you may be eligible to join a lawsuit against Pfizer, maker of Chantix. Contact me to discuss your legal options.

The Breathalyzer Is NOT Always Right!

June 25, 2008. By Heidi Turner

People who have been charged with driving under the influence (DUI) may think that once the charges are filed there is no point in fighting back. However, Vincent Imhoff, managing partner of Imhoff & Associates, PC, says that is not necessarily the case.

"People should know that it's not just up to what the [breathalyzer] said," Imhoff says. "While that is a significant piece of evidence, it is not the be all and end all. The machine must be calibrated properly, maintained properly and used properly."

In fact, Imhoff says that it is no longer shocking to him when he discovers that the reading on the breathalyzer has an error or has not been properly used or maintained. "There is no guarantee that the results of the breathalyzer is 100 percent accurate," Imhoff says. "We have to look at how the result is arrived at."

There are other elements of a DUI charge that can also be investigated. One such element is the field sobriety test.

"When you look at the sobriety test you have to look at the conditions of the test: the surface, the shoes being worn and the location have a huge impact on standing and turning. It's not fair to say, 'they slipped' if they are in heels on a loose gravel surface. Of course they slipped. Oftentimes, the video camera [in the police car] is a good asset for distilling what has happened."

Although many people associate DUI charges with alcohol only, the charge can actually be used for a number of intoxicants, including oxycontin, heroin and marijuana, although those substances cannot be detected by a breathalyzer. Such cases then rely heavily on the police officer's observations and on field sobriety tests.

Imhoff says that once a person is charged with a DUI, the state's case against the person ends and the defense's case begins. Lawyers examine all the evidence against the defendant. If the defendant has any proof that he or she was not intoxicated while driving, such as the word of a relative or friend, that evidence can help bolster the defendant's case.

If you have been charged with a DUI, there are some important things to remember, according to Imhoff.

"Don't get caught up on feeling guilt. Most DUI does not have any victim other than the defendant, so if you are in that position do not feel guilty. Many people of all walks of life have a DUI in their background. Face the charges in a straightforward and honest manner and you will have a good outcome. And do not always believe the breathalyzer."

If you have been charged with a DUI, contact a lawyer to discuss your legal options.

The Truth About Tort Reform

Fast Facts About Litigation

Proponents of so-called "tort reform" claim that litigation and the fear of litigation hinders job growth and stifles economic development. "Frivolous lawsuits are on the rise," businesses tell Congress, making it hard to compete and difficult to succeed. But studies by the federal government and neutral academic experts prove there is no statistical basis for these claims.

Federal Litigation is Decreasing

• A 2005 report issued by the U.S. Department of Justice's Bureau of Justice Statistics shows that the number of tort cases resolved in U.S. district courts fell 79 percent between 1985 and 2003.¹
• According to the Administrative Office of the U.S. Courts, tort actions in the U.S. District Courts dropped by 28% from 2002 to 2003.²
• In addition, over the last five years federal civil filings have not only decreased 8%, but the percentage of civil filings that are personal injury cases has also declined to a mere 18.2%3

State Litigation is Decreasing

• The Bureau of Justice Statistics (BJS), a division of the Department of Justice, performed a study of civil trials in state courts and found that the number of civil trials dropped by 47% between 1992 and 2001.4
• The number of tort cases decreased 31.8% during the same period.5
• The trend in award size was also down. The median inflation-adjusted award in all tort cases dropped 56.3% between 1992 and 2001 to $28,000.6

Lawsuit Filings are Decreasing

• Tort filings have declined 5% since 1993.7
• Contract filings, which are more likely to involve businesses than tort cases, rose by 21% over the same period.8
• Automobile tort filings, which make up the majority of all tort claims, have fallen by 5% since 1993 and by 14% since their high in 1996.9
• Medical malpractice filings per 100,000 population have fallen by 1% since 1998.10

Damage Awards are Down

• Median payout for all tort cases dropped 56 percent between 1992 and 2001. According to the U.S. Department of Justice, the trend in damage size for tort cases is down. The median inflation-adjusted payout in all tort (personal injury) cases dropped 56.3% between 1992 and 2001 to $28,000.11

Asbestos Case Filings are Decreasing

• Civil filings in the U.S. District Courts decreased 3 percent in 2003 to 256,858. This overall decline in filings resulted from an 83 percent reduction in asbestos cases filed.12

Class Action Cases are Rare

• In its study of civil litigation in state courts, the BJS found only one case out of 11,908 cases that could truly be classified as a class action. That case, Bell v. Farmers Insurance Exchange, involved an insurance company’s attempt to classify claims’ representatives as administrative personnel in order to avoid paying them overtime wages.

Medical Malpractice Filings are Decreasing While Numbers of Doctors are Increasing

• The number of physicians in the United States has steadily increased from 268 per 100,000 population in 1996 to 285 per 100,000 population in 2002.13
• From 2000 through 2002, the three most recent years of data available, the rate of physicians has risen in every single state.14
• Medical malpractice filings per 100,000 population have fallen by 1% since 1998.15

Lawsuit Myths

Lawsuit Myths Put Out by the Tort Reformers

Posted on Tuesday 22 January 2008

The annual Stella Awards list, a list of the years seven “most outlandish lawsuits and verdicts in the U.S.,” is nothing more than a fraud on the public. The so-called awards deal primarily with fiction, and many of the lawsuits listed never happened. The examples of what they describe as frivolous lawsuits are at best gross misstatements. The Stella Awards are just part and parcel of the carefully planned efforts designed to destroy the civil justice system. Once these awards are announced, they take on a life of their own. That’s because of the Internet. Unfortunately, the media never bothers to investigate the validity of the cases mentioned in the awards, and then write stories that keep the myths alive.

An example of how these myths orginate is this year’s runaway First Place Stella Award winner. Mrs. Merv Grazinski, of Oklahoma City, Oklahoma, who supposedly purchased a new 32-foot Winnebago motor home, was the winner. On her first trip home, from a football game, having driven on to the freeway, she set the cruise control at 70 mph and calmly left the driver’s seat to go to the back of the Winnebago to make herself a sandwich. Not surprisingly, the motor home left the freeway, crashed and overturned. Also not surprisingly, Mrs. Grazinski was supposed to have sued Winnebago for not putting in the owner’s manual that she couldn’t actually leave the driver’s seat while the cruise control was set. It was reported that an Oklahoma jury had awarded the woman $1,750,000 plus a new motor home. It was also said that Winnebago actually changed their manuals as a result of this suit, just in case Mrs. Grazinski has any relatives who might also buy a motor home. The e-mail that announced the award concludes: “Are we, as a society, getting more stupid?”

The truth is that this sort of nonsense relating to a Winnebago lawsuit never even happened. But, the media bought the story hook, line, and sinker, and never even bothered to check it out. Scores of articles – the vast majority buying the Winnebago story as gospel truth – resulted across the country. Apparently, few journalists bothered to do any research to determine whether they were true. Among outlets falling for the hoax were the New York Daily News, CNN and U.S. News & World Report. In fact, the story actually spread around the world. Readers in Canada, England, Australia, Ireland, New Zealand and even Vietnam heard about this fictitious lawsuit that never happened. To his credit, Los Angeles Times reporter Myron Levin, who wanted to learn more about the lawsuit, called Winnebago and found out there was no Grazinski lawsuit. He also learned that the company had not changed the owner’s manual to avoid a swarm of copycat claims as claimed by the Stella awards.

The next time an “Internet tale” makes you believe things are even worse than you thought, check it out. Especially when the story suggests that the American court system is stacked against wealthy Corporate America. If you want to check out the “Stella Awards” and decide for yourself whether they are on the level, a good place to go is www.snopes.com, an excellent site that investigates urban myths. Simply search for “Stella Awards” and find out if the lawsuit stories are true or false.

Want to Sue Your 401K?? Now You Can

When 401(k) Holders Can Sue

What this week's Supreme Court ruling means for people with retirement accounts

The Supreme Court has ruled that 401(k) retirement account holders can sue plan administrators for mismanaging their money. The court unanimously ruled yesterday that a Texas man, James LaRue, could take his former employer to court over $150,000 he says he lost when his investment instructions were not followed. The decision doesn't guarantee that account holders will win their money back, but it clarified their right to try. U.S. News spoke with Mary Ellen Signorille, senior attorney for AARP's litigation unit, about what account holders need to know. Excerpts:

What does this ruling mean for 401(k) holders?
Most people, if you had asked them before this case came out, would have assumed they could sue to recover their plan assets if the plan trustees did something wrong and their account balance went down. Unfortunately, the lower courts had not taken that view. The takeaway from this [ruling] is now there is a way to sue your plan fiduciary if you believe they have done something wrong that negatively affects your account balance.

What if you just don't like the plan options offered?
You won't have the right to sue over that unless you can show a breach in fiduciary duty, which means they didn't look at a variety of plan options or picked the most expensive. It would have to be something that was a breach of fiduciary duty, not just "I wanted this, and they didn't put it in."

So what would be enough to justify suing?
If you give investment instructions and they are not followed, that is clearly a situation where if there is a loss, you can sue to recover it. Let's assume that your plan has employer stock, like in Enron and WorldCom, where plan fiduciaries didn't look to see whether that is still a prudent investment. That would be something. Or if they don't look at the fees and the mutual funds are the most expensive that they could pick, that would be grounds for a lawsuit. It is a bigger-picture thing where there could be a breach of fiduciary duty if trustees don't prudently do due diligence, or they don't have procedures in place to make sure your investment instructions are followed.

Could you sue if your fund performed badly?
That gets into a gray area. I would say that in itself, without anything more, it is probably not enough, but, for example, assume your plan puts [money] in various investment options and then doesn't monitor it for five years. That may be enough for a lawsuit. There is a duty of your plan fiduciaries to monitor how your plan options are doing over time.... If they don't do any review, they've got a problem.

Will this lawsuit cause plan managers to be more careful about how they are running 401(k)'s?
I think fiduciaries always try to be careful. It made a lot of fiduciaries go back and look at the procedures and processes that they have to make sure they are working and to make sure individuals know what they are supposed to do. It's a matter of disclosure and notice. So it probably has a positive effect.

U.S. Supreme Court Declines to Hear Another Katrina Case

U.S. Supreme Court Declines New Orleans Levee Flood Damages Case

February 20, 2008

The U.S. Supreme Court has declined to hear a case brought by New Orleans property owners who argued their Hurricane Katrina flood damage should be covered despite insurance policy exclusions because the flooding was caused by the failure of the city's man-made levees.

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The high court dismissal of the case without comment means a Fifth Circuit Court of Appeals decision in favor of insurance carriers and their exclusions stands for now, but does not mean litigation over the issue of coverage for flooding caused by breached levees is over.

The Fifth Circuit court ruling (In re Katrina Canal Breaches Litigation, No. 07-30119) found that private insurance policies of Travelers, Allstate, State Farm, Unitrin and other insurers excluded the flood damage caused by breached levees.

Plaintiffs in the case had contended that because their properties were flooded as a result of the levee breaches, a "man-made act," the flood exclusions in the policies did not apply. They argued that "the massive inundation of water into the city was the result of the negligent design, construction, and maintenance of the levees and that the policies' flood exclusions in this context are ambiguous because they do not clearly exclude coverage for an inundation of water induced by negligence."

However, the Fifth Circuit Court decision on Aug. 2, 2007 concluded that the exclusions did apply. The opinion written by Circuit Judge Carolyn King found "that even if the plaintiffs can prove that the levees were negligently designed, constructed, or maintained and that the breaches were due to this negligence, the flood exclusions in the plaintiffs' policies unambiguously preclude their recovery."

The Fifth Circuit got involved after the U.S. District Court for the Eastern District of Louisiana ruled in November 2006 that ambiguous language in the water damage exclusions in some insurance policies left open the possibility that the plaintiffs could have standing to recover losses under their policies. Judge Duval refused insurers attempts to have the case dismissed. Instead, he sent the case to the Fifth Circuit Court for a review.

The inaction by the U.S. Supreme Court means attention will now turn to the Louisiana Supreme Court, which is scheduled to hear a related case on Feb. 26.

One of the plaintiffs in the appeal to the U.S. Supreme Court, Xavier University, stressed that the U.S. Supreme Court refused to hear a narrow legal issue and did not rule on the substantive claims of plaintiffs.

In a statement, Xavier University in Louisiana said it had asked the Supreme Court to consider whether it was error for the U.S. Fifth Circuit to refuse to certify an issue of Louisiana insurance law to the Louisiana Supreme Court because the Fifth Circuit had recently certified insurance issues to the Texas and Mississippi Supreme Courts.

The Louisiana issue is to be decided after the Louisiana Supreme Court hears arguments on Feb. 26 in the case Sher v. Lafayette Insurance Co., according to Xavier lawyers.

"The U.S. Supreme Court merely declined to hear the issue," the university's statement continued. "The United States Supreme Court did not consider any substantive issues and particularly did not consider whether the damages Xavier and others sustained after the levee breaches are covered by insurance. The Sher case, which was tried to a jury last March, addresses the same issue that the federal courts have thus far dealt with. The Louisiana Supreme Court will hear the issue of whether insurance wording excluding 'water' is applicable to the levee breaches, in addition to Lafayette's effort to overturn a jury verdict of bad faith in its handling of Mr. Sher's claim. The determination of these issues in the Sher case will be applicable to Xavier's claims."

The final ruling could affect thousands of property owners in the New Orleans area and an estimated $1 billion in insurance payouts.

Some "Best" Items

1. Best Long Term Care Insurance - MetLife....haven't raised premiums for existing policyholders.

2. Best Way to Fight Phone Trees - Go to www.gethuman.com. This gives you a list of ways to actually talk to a person.

3. Best All-Around Retirement Account - Roth IRA....no competition.

4. Best Vehicle for the Money - Toyota Camry. There's a reason it's number one.

5. Best Cellphone - iPhone....I just hope they come down in price.

Some Good News From Iran for A Change

Iran chief judge limits public executions

[JURIST] Iran's chief judge issued a ban [IRNA report] Wednesday against all public executions not specially permitted by the head of the judiciary. Ayatollah Mahmoud Hashemi Shahroudi [Wikipedia profile] also banned the publication of pictures and videos of executions and ordered state prosecutors to enforce the bans. Commentators said that Shahroudi probably wants to remove executions from the public eye [BBC report] following harsh international criticism of Iran's execution practices, including stoning [JURIST report] and the execution of juveniles [JURIST report]. Shahroudi, who is a moderate conservative, was also responsible for issuing a 2002 moratorium against stoning and declaring a ban on using torture to force confessions.

Insurance Companies Report Record Profits

Despite all the disclaimers and rhetoric, insurance companies are doing better than ever. Allstate reported a $5 billion PROFIT for 2006, and State Farm's PROFIT increased over 65% for the same year.

A year and a half after Katrina ravaged the Gulf Coast, the insurance companies are raking it in.

Thankfully, scores of lawsuits are settling and going to verdict with the devastated homeowners finally collecting at least some of what they are owed by these behemoths.

Why is it so hard to just do the right thing?

My First Post In A While

This is my first post in a while. Thankfully, my practice has been very busy lately, and I have been unable to blog.

My goal is to post once a day, but I may not be able to achieve that.

Doctors Involved In Huge Fraud Scheme

Calif. doctors charged with surgery scam

© 2007 The Associated Press

SANTA ANA, Calif. — Three doctors were charged with billing insurers for $30 million of unnecessary surgery performed on hundreds of patients recruited from around the country.

Authorities said the patients received money or low-cost cosmetic procedures for participating in the "rent-a-patient" scam at Unity Outpatient Surgery Center.

More than $5 million of the insurance claims were paid, authorities said.

Arrested Wednesday were Dr. Michael Chan, an obstetrician; Dr. William Hampton, a surgeon; and Dr. Mario Z. Rosenberg, a gastroenterologist.

Each was charged with 47 felony counts including conspiracy after billing 19 insurance companies for what authorities said were unnecessary colonoscopies and surgeries on 940 patients. Bail ranged from $1 million to $2.3 million.

Each doctor could face nearly 50 years in prison. The California Medical Board was also pursuing suspension of their licenses.

Fourteen other people — five administrators and nine recruiters — have been charged as part of a four-year investigation.

"Doctors need to know if they commit insurance fraud, they may be trading in their scrubs for prison jumpsuits," District Attorney Tony Rackauckas said.

Chan, 61, was the owner and medical director at Unity. Authorities said he performed 211 unnecessary procedures on 208 patients, billing $9.5 million in claims, of which $1.8 million was paid to the clinic.

Rosenberg, 60, and Hampton, 51, also performed hundreds of procedures, billing insurers $21 million in claims, of which $3.3 million were paid, prosecutors said.

Their first court appearance was pending. It was not immediately known whether any had retained attorneys.

ANOTHER Beach Boys Lawsuit! Can't These Guys EVER Stop Suing Each Other???

Lawsuit by Beach Boys Mike Love against former band member to proceed to trial

(AP) - LOS ANGELES-A Superior Court judge ruled that a lawsuit brought by the Beach Boys' Mike Love against former band member Al Jardine can proceed to trial.
In ordering that the case be heard by a jury, Superior Court Judge James R. Dunn on Tuesday denied Love's motion to rule immediately in his favor. A trial date was not immediately scheduled.
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Love is seeking $2 million (€1.54 million) in court costs and another $1 million (€770,000) in earnings he said Jardine wrongly was paid for using the Beach Boys' name in connection with other bands in which he has performed.
Love maintains that only he has the rights to perform under the Beach Boys' name, and federal courts ruled in 2003 that Jardine must stop using the name. Jardine had been performing under such names as "Beach Boys Family & Friends," "Al Jardine, Beach Boy" and "Al Jardine of the Beach Boys."
The Beach Boys were founded in 1961 by brothers Brian, Carl and Dennis Wilson, their cousin Love and Brian Wilson's friend Jardine.
Dennis Wilson died in 1983 and Carl Wilson died in 1998.
Brian Wilson continues to tour and record with his own band, and Jardine recently joined him for a tour featuring performances of the Beach Boys' classic album "Pet Sounds."