An Illinois appeals court will allow a father whose son died after drinking too much alcohol during a fraternity’s initiation ritual, to resume his lawsuit against the Northern Illinois University fraternity, saying a Cook County judge erred in dismissing the wrongful death action against the local chapter and its leaders.
The Illinois First District Appellate Court took up the appeal of Gary L. Bogenberger, administrator of the estate of his son, David, who became drunk to the point of unconsciousness during a November 2012 event at the Eta Nu chapter of Pi Kappa Alpha at Northern Illinois University in DeKalb, and subsequently died.
Yesterday a jury in St. Louis, MO awarded $17.5 million in damages to three plaintiffs and assessed $29 million more in punitive damages against Monsanto and three other companies in a suit here alleging negligence in the production of PCBs.
Despite this verdict on behalf of injured plaintiffs, chemical safety in America is on precarious ground. A new version of the Toxic Substances Control Act has passed both the House and Senate. While the new bill would be, by most measures, a major improvement over the 40 year old existing TSCA, there is one glaring exception. PCBs. Polychlorinated biphenyls. PCBs are used to make everything from fluorescent lighting, to plastics, caulking and oil-based paints. Until it stopped production in 1977, Monsanto was the source of 99% of the polychlorinated biphenyls used by U.S. industry.
PCBs have been demonstrated to cause cancer, as well as a variety of other adverse health effects on the immune system, reproductive system, nervous system, and endocrine system. These problems may not affect Monsanto however. The New York Times notes:
Facing hundreds of millions of dollars in lawsuits, the giant biotechnology company Monsanto last year received a legislative gift from the House of Representatives, a one-paragraph addition to a sweeping chemical safety bill that could help shield it from legal liability for a toxic chemical only it made.
Monsanto insists it did not ask for the addition. House aides deny it is a gift at all. But the provision would benefit the only manufacturer in the United States of now-banned polychlorinated biphenyls, chemicals known as PCBs, a mainstay of Monsanto sales for decades. The PCB provision is one of several sticking points that negotiators must finesse before Congress can pass a law to revamp the way thousands of chemicals are regulated in the United States.
Imagine you sign a contract for a cell phone. You agree to pay $50 per month. At the end of the month you get your bill and it’s $200 instead of the agreed upon amount. Now, imagine you’re one of 10,000 customers that the phone company has done this to. You meet with a lawyer, you form a class and sue the phone company. A class action lawsuit is born.
Not so fast, says the phone company, you signed a contract. In the contract is an arbitration agreement. We can’t go to court, we must go to arbitration. And, by the way, there are no class actions in arbitration. You must proceed on your own. If you lose, you pay for your own legal fee plus the fees of the phone company. Sound fair?
The New York Times has published a three part series about forced arbitration clauses in consumer contracts. These clauses, slipped into contracts ranging from cell phones to nursing, strip a consumer from their ability to sue or form a class action. Instead, consumers are forced to arbitrate their cases.
I’ve written before about the dangers of forced arbitration. (See Class Dismissed: Concepcion and the End of Class Arbitration). Over the last few years, as the New York Times reports “it has become increasingly difficult to apply for a credit card, use a cellphone, get cable or Internet service, or shop online without agreeing to private arbitration. The same applies to getting a job, renting a car or placing a relative in a nursing home.”
Corporations are increasingly filing – and winning – legal motions to force plaintiffs in federal class actions out of the courts and into private arbitration hearings. In arbitration, plaintiffs must pursue claims as individuals and in private proceedings. The problem is that most damages are very low, often less than $100, while legal fees remain sky high. The Economic Policy Institute Explains:
Giving up the constitutionally protected right to sue in state or federal court is a big deal and is often the result of ignorance and deceit: millions of people have no idea the clauses are there in the fine print of contract provisions written in legalese that few individuals ever read or comprehend. They don’t find out they’ve lost their rights until they need them.
Individuals give up not just their right to go to court but all protections regarding the venue of any hearing their claim will receive (for example, the agreement might require arbitration in a city a thousand miles away). They might give up certain remedies and the right to appeal even if the arbitrator gets the law completely wrong, and give up the essential right to join with other victims to file a class action, especially important when each claim is small and no single individual could rationally pay to hire a lawyer and bring a lawsuit for such a small sum.
The myth is that arbitration is preferable because it allows individuals to resolve their grievances easily, quickly, and cheaply. In fact, arbitration can be more expensive for a plaintiff than a civil suit because instead of a small filing fee in court, the plaintiff will have to pay half of the arbitrator’s fee, or sometimes all of it if the arbitration clause includes a “loser pays” provision. Legal fees can be ruinous, and the Times story relates the case of a woman who owes $200,000 in attorney fees after losing a case in which her former employer allegedly destroyed evidence.
With businesses using forced arbitration, consumers are unwittingly giving up their right to sue in a traditional forum – the court room. As was the case in AT&T v. Concepcion. In AT&T v. Concepcion, customers said the company had promised them a free phone if they signed up for service, and then, when they didn’t get the free phone, charged them $30.22 for it anyway. While these damages may seem trivial, multiplied by the number of consumers affected, the damages would be significant as a class.
Forced to arbitrate as an individual over the $30 fee, the costs of arbitration and the risks of losing and paying legal fees for both sides, outweigh the benefits of proceeding through the process and remedying the wrong.
The costs associated with arbitration are too high and the risks too great for consumers to proceed and get the justice they deserve. For example, the data on consumer arbitration obtained by The Times shows that Sprint, a company with more than 57 million subscribers, faced only six arbitrations between 2010 and 2014.
Forced arbitration clauses are just another tool to prevent access to the courts and whittle away the rights of consumers.
Playgrounds aren’t always fun and games according to a new study. Researchers found that children are increasingly being diagnosed with traumatic brain injuries after a run-in with playground equipment.
Researchers from the National Center for Injury Prevention and Control looked at injury rates for kids under 14 from 2005 to 2013 and determined that there was a significant increase in children going to the emergency room for traumatic brain injuries. Boys accounted for 58.6 percent of the TBIs identified while 50.6 percent of children between the ages of five and nine had injuries, according to a study published today in the Pediatrics Medical Journal.Most playground-related TBIs were associated with monkey bars and swings, according to researchers.
The authors theorize that the rise in injuries can be attributable to two reasons: increased playground time for kids and increased awareness among parents and doctors about the dangers of head injuries.”It is also plausible that heightened public awareness of TBI and concussions has prompted parents to seek medical care for their children in the event of a head injury, when previously they would not have done so,” the authors wrote.
The New England Journal of Medicine has analyzed data that 1% of physicians account for approximately 32% of paid medical malpractice claims. The data – which was pulled from the National Practitioner Data Bank – shows that over a recent 10-year period, a small number of physicians with distinctive characteristics accounted for a disproportionately large number of paid malpractice claims.
A study of 70,000 malpractice claims against approximately 55,000 doctors from 2005 through 2014, the Journal analyzed data with the hope of understanding the distribution of malpractice claims among physicians.
Among all of the physicians with paid claims, 84% incurred only one malpractice claim during the study period, which accounted for 68% of all paid claims. Of the remaining physicians, 16% had at least two paid claims during the relevant time frame, accounting for 32% of the claims.The last 4% of doctors had at least three paid claims (if not more), accounting for 12% of the claims.
Physicians who had three paid medical malpractice claims have three times the risk of incurring another paid medical malpractice claim in the future. Practitioner speciality also plays a role: the risk of malpractice among neurosurgeons, for example, was four times as great as the risk among psychiatrists.
The Journal’s conclusion boils down to this startling fact: “A small number of physicians with distinctive characteristics accounted for a disproportionately large number of paid [medical] malpractice claims.”
The Center for Justice & Democracy reports that according to the report, published in the Journal of Patient Safety, ‘between 210,000 and 440,000 patients each year who go to the hospital for care suffer some type of preventable harm that contributes to their death,’ the study says. Only heart disease and cancer cause more deaths in America than avoidable medical errors.
Source: Marshall Allen, “How Many Die From Medical Mistakes in U.S. Hospitals?” ProPublica, September 19, 2013, cited in CJ&D’s Briefing Book: Medical Malpractice – By The Numbers (p. 77)
The Consumer Financial Protection Bureau is examining so-called arbitration clauses in terms and conditions for financial products. Last week, the head of the bureau, Richard Cordray, sent the strongest signal yet that the regulatory whip soon will come down on banks and other lenders denying customers their day in court if they feel mistreated.
“By inserting an arbitration clause into their contracts, companies can sidestep the legal system, avoid big refunds and continue to pursue profitable practices that may violate the law and harm consumers,” he said in a speech to the American Constitution Society.
“Companies should not be able to place themselves above the law and evade public accountability simply by inserting the magic word ‘arbitration’ in a document and dictating the favorable consequences,” Cordray said. “Consumers should be able to join together to assert and vindicate their established legal rights.”
Forced arbitration has become a routine part of many companies’ dealings with customers, thanks to the U.S. Supreme Court, which has issued several rulings in recent years upholding the practice.But under the financial reform law enacted in 2010, the Consumer Financial Protection Bureau was empowered to study forced arbitration by financial services firms and to issue new regulations if deemed necessary. It now seems certain that rule changes are in the works.This would affect banks, credit card issuers and other firms falling under the agency’s jurisdiction.
It wouldn’t affect non-financial businesses that also inflict arbitration clauses on customers, such as phone companies, pay-TV providers, rental car firms and others.That would take an act of Congress.
Lawmakers recently introduced a bill in the U.S. Senate called the Restoring Statutory Rights and Interests of the States Act. It would forbid companies from making customers waive their right to sue or join a class-action lawsuit.
The impact of Justice Antonin Scalia’s death is already being felt in major business litigation with news Friday that Dow Chemical is settling an antitrust class-action lawsuit in part because the company lost a likely ally on the high court. Dow will reportedly settle the price-fixing class action suit involving 6 different chemicals for a whopping $835 million.
“With the untimely, unfortunate death of Justice Scalia, it leaves in question the current structure of the court,” Dow Chemical spokeswoman Rachelle Schikorra told WSJ. “With this changing landscape, the unknowns, we just decided to put this behind us.”
From Bloomberg Business News:
Johnson & Johnson must pay $72 million to the family of a woman who blamed her fatal ovarian cancer on the company’s talcum powder in the first state-court case over the claims to go to trial.
Jurors in St. Louis on Monday concluded J&J should pay $10 million in compensatory damages and $62 million in a punishment award to the family of Jackie Fox, who died of ovarian cancer last year after using
Johnson’s baby powder and another talc-based product for years.
It’s the first time a jury has ordered J&J, the world’s largest maker of health-care products, to pay damages over claims that it knew decades ago that its talc-based products could cause cancer and failed to warn consumers.
The case is Fox v. Johnson & Johnson, Cause No. 1422-CC09012-01, Division 10, Missouri Circuit Court, 22nd Judicial District (St. Louis).