Monday, January 31, 2011

Hot Coffee!!!!

Yes, yes, we all know about the hot coffee case. But do you really know the truth?

A documentary is in the running at Sundance Film Festival called Hot Coffee, and it explores not only that case but three other lawsuits in which seriously injured people are denied their rights under the current legal system.

Many people have no idea how we as Americans are being manipulated by powerful interests, and we are losing our rights to fairness and justice under so-called "tort reform." We are giving away our 7th Amendment rights and we don't even know it.

I haven't seen the movie yet, but here's a trailer and discussion:

The civil justice system has been under heavy attack for over 25 years.

Despite the fact that federal legislation has never been successful, big business interests have won in the hearts and minds of average people. They launched a public relations campaign starting in the mid-80’s and continuing over the last two decades to convince the public that we have out of control juries, too many frivolous lawsuits and a civil justice system that needs reforming. They have used anecdotes, half-truths and sometimes out and out lies in their efforts, for one purpose – to put limits on people’s access to the court system, the one and only place where an average citizen can go toe to toe with those with money and power and still have a shot at justice.

Because of the success of the public relations campaigns, paid for by tobacco, pharmaceutical and insurance companies, to name a few, our civil justice system is not impartial. Jurors have been brainwashed into believing that a large verdict will affect their pocketbooks. Voters believe that we have a court system out of control that needs reforming. Although there are consumer advocacy groups who have attempted to set the story straight, there has yet to be enough money to launch the kind of public relations campaign for consumers that can even begin to combat and challenge the public relations campaigns of pro-business and tort reform groups. Over the last few years, however, documentary films and independent film festivals have become a vehicle for alternative ideas to get a public forum.

Because almost everyone has heard about the McDonald’s coffee case, and most people believe they know what it’s about, this project has a fascination for people. Of course, we go much further into the debate than just the McDonald’s coffee case, but the case is a vehicle for people to think about their long held beliefs and whether they are valid. We think this movie has the potential, with the right funding and effort, to really change the way people think about our civil justice system and access to the courts.

Friday, January 28, 2011

Why is Obama attacking the Constitution?

This is a brilliant blog entry from 7th Amendment Advocate Blog about the absurd idea of federal tort reform mentioned by President Obama in his State of the Union:
I'm disapppointed that the President and the sponsors of H.R. 5 have targeted this sector of the Constitutionally protected civil justice system for a federal takeover. When Pres. Obama raised it during the SOTU, conservative commentator Ramesh Ponnuru immediately called it "one of the Republicans' crummiest ideas" and added, "There's no need for a federal takeover of medical-malpractice rules." EXACTLY. But apparently the President and senior members of the GOP (the party of "limited government") now aim to limit your 7th Amendment right by using a government mandate, exactly what the GOP opposes in ObamaCare. Bizarre.

Here are a set of reasons why Tea Partiers, Constitutional conservatives, Main Street Republicans and Blue Collars should vigorously oppose H.R. 5 and any federal law limiting medical malpractice lawsuits:

1. The Constitutional basis for medical malpractice tort reform is also the basis for ObamaCare, and both violate the 10th Amendment's protections of states' rights. When he introduced H.R. 5, Rep. Phil Gingrey cited the language of the Commerce Clause: of the Constitution. I wrote about the abuse of the Commerce Clause of the Constitution in separate posts on December 6, on December 14, and on January 4. Simply put, the pro-medmal-reform and pro-ObamaCare forces depend on the theory that the Commerce Clause trumps the protection of individual and states' rights in the Bill of Rights. That's a formula for a slide into dictatorship. And as I wrote on December 6, Founding Father George Mason foresaw the holes in the Constitution and argued against ratification of the Constitution without a Bill of Rights.

2. A better name for any such bill is the "Abortion Butchers & Sexual Abusers Civil Immunity Act of 2011." If enacted, doctors who kill babies and their mothers (see the Gosnell case) could leave jail after their sentence is up, then stop by the bank to pick up their blood money and start over. Why would a pro-lifer (like me) ever want to limit the amount of money an abortion victim could take from killers and butchers in a civil suit?! And it even protects doctors who commit intentional torts, such as sexual abuse! The broad scope of H.R. 5 also protects bad drug and device companies which have been criminally prosecuted.

3. The bill does nothing to stop medical malpractice, which kills up to 100,000 Americans annually and injures up to ten times that number. The bill doesn't improve hospital hygiene, medical records technology, or any other medical practice. Medical malpractice lawsuits can't exist if there's little or no medical malpractice.

4. We have a medical malpractice crisis, but not a medical liability crisis. The number of medical malpractice claims has been headed down - yes, DOWN - for years, down 15 percent from 1999 to 2008. The insurance industry's own data reveals that the amount they've paid out for malpractice claims dropped by over 40% between 2002 and 2008, when adjusted for inflation. H.R. 5 is like fixing a flat tire by emptying the radiator. It misses the point and attacks a non-problem.

5. This bill would increase government spending, because those unable to hold wrongdoers accountable will become dependent on Medicare and Medicaid for payment of their medical costs. The taxpayers will be forced to pay for incompetent doctors and for drugmakers' and medical device manufacturers' faulty products.

6. Why would the GOP immunize industry groups which endorsed ObamaCare and enabled its enactment? The AMA and Big Pharma gave us ObamaCare's unconstitutional mandate, budget-busting spending hikes, and huge tax increases. THANKS FOR NOTHING.

7. Medical malpractice today, religious liberty and gun rights tomorrow? There is no differentiation regarding medical malpractice lawsuits under the Constitution. This would be the same as capping damages in suits against schools firing Christian professors or limiting the size of gun clips.

8. The Founding Fathers were never for tort reform. Back in September, I offered to buy the best dinner in Washington to anyone to shows me just ONE pro-tort reform quote by any Founding Father. I've had no takers and I'm not worried, because none of them proposed limiting our 7th Amendment rights.

To the contrary, the Founding Fathers endorsed and protected the "unalienable right" that a citizen could bring civil claims to a local court of law, before a jury of peers. That right had been expressly recognized in British law for centuries, back to the signing of the Magna Carta in 1215.

Wednesday, January 19, 2011

GlaxoSmithKline's $3.4 Billion Charge on Avandia

GlaxoSmithKline is taking a huge hit in the amount of $3.4 billion that it is charging off due to the litigation and settlement involving its diabetes drug Avandia. The drug is known to cause heart attacks and apparently GSK's former CEO knew about it way back when.

When will companies learn that it is cheaper to do the right thing that get slapped for doing the wrong thing?

Bnet has more:

GlaxoSmithKline (GSK)’s $3.4 billion legal charge on the diabetes drug Avandia probably isn’t the last of the costs the company will record against this drug. That means Avandia will probably be a loss maker for GSK, proving that former CEO Jean-Pierre Garnier’s 1999 failure to follow up on worries about heart attack deaths associated with Avandia was a strategic disaster for the company, costing it billions in actual dollars and billions more in lost-opportunity dollars.

When the dust has settled, GSK would probably have been better off stashing its development and marketing costs in a savings account rather than spending them on Avandia, some back-of-the-envelope math reveals.

Picking through GSK’s disclosures, two things emerge:
  • The charges aren’t over yet even though GSK suggested in previous statements that the “substantial majority” of its Avandia problems were dealt with.
  • When all is said and done, GSK will probably have lost money on Avandia even though it earned more than $16.3 billion in revenues during its lifetime.

Friday, January 14, 2011

Lawyer v. Adjuster

This is just a funny video...and true...I feel for my colleagues on the insurance defense side...

Wednesday, January 12, 2011

Could it be...Satan?

Interesting oral argument yesterday in the Zicam litigation brought by its shareholders relating to corporate disclosures. Satan, Scalia and anosmia...quite a lively discussion. The New York Times has more:
What do you think about Satan?” Justice Scalia asked a lawyer for the government, who was just starting his argument.

The case, Matrixx Initiatives v. Siracusano, No. 09-1156, was a class action against Matrixx Initiatives, an Arizona company accused of committing securities fraud by failing to tell investors of reports that its main product, a nasal spray and gel called Zicam, might have caused some users to lose their sense of smell. The condition is known as anosmia.

After a link between Zicam and anosmia was reported on “Good Morning America” in 2004, the company’s stock dropped 24 percent. In 2009, the Food and Drug Administration warned consumers not to use the products, which had been sold as over-the-counter homeopathic medicines, and Matrixx recalled them.

Satan came into the case by way of analogy. Matrixx contended that it should not have been required to disclose small numbers of unreliable reports of adverse effects, which were all it said were available in 2004.

“For years many consumers would not purchase products from Procter & Gamble because of a ridiculous rumor that the company was Satanic,” Matrixx said in a recent brief. “But no decision of this court bases securities-law disclosure obligations on how ignorant or paranoid people might react to unreliable or even false information.”

The Supreme Court has said that companies may be sued under the securities law for making statements that omit material information, and it has defined material information as the sort of thing that reasonable investors would believe significantly alters the “total mix” of available information.

Much of the argument revolved around whether reasonable investors would want to know about false and outlandish assertions like the one about Satanism so long as the assertions might affect the price of securities.

“A reasonable investor is going to worry about the fact that thousands of unreasonable investors are going to dump their Matrixx stock,” Chief Justice John G. Roberts said.

Justice Scalia disagreed. “It seems to me ridiculous to hold companies to irrational standards,” he said.

Though the justices were divided about how to handle reports of Satanism and the like, Matrixx did not appear to get much traction for its main argument — that a failure to disclose reports of adverse effects should give rise to securities fraud liability only if the reports were collectively statistically significant.

Full story here.

Monday, January 10, 2011

Zicam to Argue Before U.S. Supreme Court Today

Matrixx Initiatives, the makers of Zicam, will argue today before the U.S. Supreme Court regarding what drugmakers, medical companies and other businesses tell investors about their products.

The issue involves whether Matrixx Initiatives violated securities laws when it didn't tell investors that some consumers complained that they lost their sense of smell after using Zicam Cold Remedy nasal spray and gel swabs.

The case is Matrixx Initiatives v. Siracusano, and the SCOTUS info and briefing is here.

The Arizona Republic has more:

Drugmakers, biotechnology groups and other business interests have lined up behind Matrixx Initiatives, arguing that widespread disclosure of medical complaints from people who take drugs or use medical devices would confuse investors and consumers. The U.S. Securities and Exchange Commission, AARP and others have sided with a Decatur, Ill.-based pension fund that sued the company.

The nation's high court will hear oral arguments today in the case, Matrixx Initiatives vs. Siracusano, and is expected to issue a ruling during its term that ends in June.

This case may outlast the company. Matrixx last month struck a $75.2 million deal to sell to a Miami-based private investment company, H.I.G. Capital LLC. Shareholders have been asked to accept the investment firm's tender offer of $8 per share before the end of January.

The pension fund sued Matrixx in 2004, alleging the company concealed reports that linked Zicam to loss of smell. In 2006, the U.S. District Court in Phoenix dismissed the case after Matrixx argued that the reports of smell loss were not "statistically significant" enough to show that Zicam was associated with smell loss as opposed to random chance.

The 9th U.S. Circuit Court of Appeals reversed the district court's ruling, triggering Matrixx's petition to the Supreme Court.

Read more:

Thursday, January 06, 2011

Drop-Side Crib Ban Takes Effect in June 2011

Following the deaths of at least 32 babies since 2000 from falls or strangulation, the Federal Product Safety Commission recently adopted new crib-safety specifications that one observer called the "strongest crib standard in the word."

The new rules ban all drop-side cribs and impose tougher rules for crib slats and mattress supports, with the goal of eliminating gaps in which babies can become trapped and suffocate or strangle to death.

The new rules, which take effect in about six months, will make it illegal to resell almost all current cribs, because they won't meet the new standard, the Tribune says. They will require hotels and child care centers to replace their current cribs within two years.

If your baby has been injured by a drop-side crib, contact us at 713-529-1177 to learn your legal options against the manufacturers of these dangerous products.

Tuesday, January 04, 2011

Happy New Year and Zicam Settlement

Happy New Year--we've started the new year off in a very busy way--Matrixx Initiatives offered a settlement to our Zicam clients right before Christmas. Matrixx is offering a $15.5 million to settle the lawsuits who allege that they lost their sense of taste and smell due to the company’s recalled line of nasal sprays and gels.

Zinc gluconate-containing Zicam products were recalled in 2009 after the FDA identified at least 120 adverse event reports involving loss of smell with Zicam Cold Remedy Nasal Gel, Zicam Cold Remedy Nasal Swabs and Zicam Cold Remedy Swabs Kids Size.

In the aftermath of the recall, FDA inspectors discovered 800 reports of Zicam problems that Matrixx Initiatives failed to forward to the agency, in violation of federal regulations.