March 1st, 2017

Republicans Move to Grant Immunity for Medical Malpractice

Yes, a real case. Yes, the x-ray hangs in my office.

Well, this comes as no surprise. With Republicans now controlling the Senate, House and White House, they have decided that they didn’t really mean what they said about states’ rights. And they didn’t really mean what they said about personal responsibility.

Out of the House of Representatives, courtesy of Rep. Steve King of Iowa, comes a bill (H.R. 1215) to grant immunity to doctors and hospitals if they negligently injury someone.

Given that 210,000 to 440,000 are estimated to die each year from medical malpractice  — a number that dwarfs the 30,000+ killed by guns — you should care about the subject.

Cynically named as a bill to “improve patient access to health care services” by “reducing the excessive burden the liability system,” the King bill slams an artificial cap on awards for pain and suffering at $250,000 in both federal and state cases, among many other things.

Did the hospital negligently operate on the good leg instead of the bad one? 250K.

Did you lose the good leg? The same 250K.

Did you also lose your previously bad leg because they operated on the wrong  one? The same 250K.

And it comes as no surprise to anyone that lawyers won’t actively jump at the chance to spend hundreds of hours and tens of thousands of dollars on a suit that is so artificially limited. Thus, de facto immunity for most pain and suffering causes of action from medical malpractice.

How does King go all federal on this, going deep into what is most often a state cause of action? By stating that it will apply to anyone that receives health care through a “federal program, subsidy, or tax benefit.” [Copy Of Bill] That means anyone who uses Medicaid, Medicare, veterans health plans or Obamacare.

And by “tax benefit,” it may mean anyone who has a deduction for healthcare of any kind.  Essentially, the idea is to make sure that no one, anywhere in the country, can ever bring a meaningful action for medical malpractice.

The losers in this, of course, are the patients and their families who have already been injured once. And the taxpayers, who are now forced to pick up the tab for the rest of the loss.

King’s bill is based on a faulty premise, that doctors and hospitals order unnecessary tests to protect against malpractice claims. This is the “defensive medicine” theory of why medical costs go up.

But that theory was tested in Texas, and found to fail. As I noted in 2011, the $250,000 Texas cap didn’t stop medical increases. In fact, costs went up faster in Texas than in states that didn’t have a cap.

While doctors may have saved money with fewer suits, and insurance companies may have made buckets more money, it didn’t stop health care costs from rising.

The Texas Experiment also was also supposed to bring more doctors to Texas and more to rural counties. It didn’t work.  Even noted tort reformer Ted Frank wrote, in 2012, that the data from Texas “substantially undermines the empirical case for the conventional wisdom that Texas’s 2003 reforms against medical malpractice lawsuits attracted more doctors to Texas.” Ouch.

Frank went on to conclude:

I, for one, am going to stop claiming that Texas tort reform increased doctor supply without better data demonstrating that.

The real kicker to the artificial caps, of course, is that the taxpayers then get saddled with the costs of the injured person instead of the ones that negligently caused the injury. That’s right, saddling the taxpayers with the costs is a form of socialism. And it is being promoted by alleged conservatives.

The myth that tort “reform” reduces costs was debunked awhile ago. As Steven Cohen noted in Forbes two years ago regarding additional studies, there was no reduction in the expensive tests from states with caps:

That myth was dispatched by the recent publication of a major study in the New England Journal of Medicine. A team of five doctors and public health experts found that tort reform measures passed in three states – specifically designed to insulate emergency room doctors from lawsuits — did nothing to reduce the number of expensive tests and procedures those ER doctors prescribed.

Cohen went on to summarize that none of the “expected” reductions in health care costs came to fruition:

This latest study follows numerous others that deflated other tort reform myths: that making it harder for victims to file medical malpractice lawsuits would reduce the number of “frivolous” suits that “clog the courts;” that imposing caps on the damages victims could receive would reign in “out of control” juries that were awarding lottery-size sums to plaintiffs; and that malpractice insurance premiums would fall, thereby reversing a doctor shortage caused by specialists “fleeing the profession.”

Trump is now on the bandwagon also, or at least whoever wrote this portion of his speech last night:

“Fourthly, we should implement legal reforms that protect patients and doctors from unnecessary costs that drive up the price of insurance — and work to bring down the artificially high price of drugs, and bring them down immediately.”

This oblique reference — Trump never deals in details — was presumably put there by his staff, as I know of no other Trump comment on the subject of medical malpractice.

But wait, there’s more! Tort “reform,” you see, has never saved a life. But has it ever killed anyone? Answer, yes!

I addressed that subject a few year back by pointing to plunging payouts at Columbia Presbyterian Hosptial / Cornell Weill Medical Center. A study found that “instituting a comprehensive obstetric patient safety program decreased compensation payments and sentinel events resulting in immediate and significant savings.”

How much did they save by instituting new safety procedures — in pure dollars and cents leaving aside the human misery of injury? “The 2009 compensation payment total constituted a 99.1% drop from the average 2003-2006 payments (from $27,591,610 to $ 250,000).”

You read that right: 99.1% drop. Based on a safety program, not tort “reform.”

Now if Congress wants to take away the incentive for safety, and just give immunity, you can expect continued deaths. The results should have been screamed from the rooftops:

Safety improvements = fewer malpractice payments and healthier patients.

Tort reform = more patient deaths.

Now let’s return to politics, shall we? I just want to close by asking conservatives a few questions, and do so with the knowledge that medical protectionism has already been a proven failure in reducing health care costs:

1. Do you believe in limited government?

2.  Is giving immunity your idea of limited government?

3.  Do you believe in states rights? Would federal tort “reform” legislation that limits the state-run civil justice systems run contrary to that concept?

4.  Do you believe in personal responsibility?

5.  Do you want to limit the responsibility of negligent parties and shift the burden to taxpayers?

6.  If you believe in having the taxpayers pay for injuries inflicted by others, how much extra in taxes are you willing to authorize to cover those costs?

7.  Is shifting the cost of injuries away from those responsible, and on to the general public, a form of socialism?

Elsewhere:

Congress Moves To Punish Anyone Using The ACA And Medicare (Doroshow @ Huffington Post), which lists other “features” of the bill

Statement of the Honorable John Conyers, Jr. In Opposition to H.R. 1215, the So-Called “Protecting Access to Care Act of 2017”

 

February 24th, 2017

Melania Trump’s Lawsuit and Tax Returns

The other day I ripped Melania Trump‘s lawyers for stupidly claiming — in a defamation lawsuit against those that called her an escort while she was a model — that she had lost her once-in-a-liftime opportunity to capitalize on being the most famous women in the world for the next few years.

Personally, I thought the lawyers had committed legal malpractice in having done so, as it exposed her to a (well-deserved) torrent of scorn and derision.

She has now amended the lawsuit to take out the offending material.

But you know what is left? She still claims economic loss, and that is the subject of today’s post. Because if you claim economic loss, then one thing you can bet your last dollar on is that the defendants will say, “prove it!”

And part of that proof will be her tax returns, so that competing expert economists can do an evaluation of what she was making before (and how she was doing it), and how (if at all) it was affected.

First, the nuts and bolts of the claim from the Amended Complaint:

33.  The defamatory statements in the Article have caused Plaintiff damages, including to her reputation and to her business interests and prospective economic opportunities, as well as causing significant humiliation in the community and emotional distress.

So she has not only claimed a per se injury for being called a prostitute, she alleges damage to her business interests and prospective economic opportunities.

Now tax returns, in New York, are jealously guarded by the courts.  A party seeking to compel their production must make a strong showing of overriding necessity.

Melania Trump’s case is in New York County, the First Department, but all four of New York’s appellate departments have a high bar to hurdle.

But at least some of her returns, it seems, will meet that burden. And how much of her interests are intermingled with her husband’s? Nobody knows, but any intermingling at all could subject his returns (or parts of them) to discovery.

In one of the most oft-cited cases on the subject in the First Department, the court reversed a trial court justice that had granted the disclosure of tax returns in a partnership dispute. In Gordon v. Grossman the court held that “It was an improvident exercise of discretion to compel disclosure of the defendant’s tax returns. Because of their confidential and private nature, disclosure of tax returns is disfavored.”

And in Matthews Indus. Piping Co., Inc. v. Mobil Oil Corp., the lower court denied the defendants request to peak into the plaintiff’s returns and the First Department affirmed that decision. The court wrote that “The disclosure of tax returns is disfavored due to their confidential and private nature. Consequently, a party seeking to compel their production must make a strong showing of overriding necessity.”

Similar language comes from the Second Department, where the rule is that “A party will not be required to produce income tax returns in a particular action unless the record presents a strong necessity for such disclosure in order for the party to prove its cause of action or defense.” In Active Fire Sprinkler v. American Home, that court held that there must be “some showing that the particular information in tax returns has some specific application to the case.

Now here’s the kicker: Few people will want to donate money for any kind of legal defense fund, if one is needed. Because who wants to get in bed with the kind of d-bag that would write crap like that without evidence? (I have no idea if there is insurance coverage for this.)

But remember Peter Thiel funding the Terry Bollea (Hulk Hogan) sex tape lawsuit against Gawker?

Might there be some people willing to pony up money to see this matter go through discovery just to get to those tax returns?

Even if the returns are subject to a confidentiality agreement, all bets are off in a trial that takes place in open court.

Conclusion: Melania Trump has exposed herself, and potentially her husband, to having her tax returns revealed in discovery.

The only way out of this for her to drop her claim of economic loss entirely.

 

 

 

February 22nd, 2017

Saving TechDirt

As regular readers know, I’ve twice been sued for defamation over my reporting and opinions from this blog.

When Joseph Rakofsky sued me (and so many others) for reporting on his dreadful attempt to defend a murder case in his first ever trial, TechDirt was there to shout in our defense.

When Dr. Michael Katz sued me for reporting that a Queens judge repeatedly called him a liar in open court, TechDirt was once again there to scream from the rooftops.

Now it’s my turn to holler for TechDirt, as it’s very survival may hinge upon raising funds needed to defend itself from a defamation claim.

TechDirt, which gets 1.5M visitors a month, does original reporting and commentary about changes in government policy, technology and legal issues.

The blog is well written, well-researched, with just the right amount of snark to make reading that’s both enjoyable and informed even if the subject isn’t one you’d normally read.

So they’ve have been sued. For writing about who “invented” email.

Shiva Ayyadurai claims he invented email. And he didn’t seem to appreciate TechDirt’s Mike Masnick of calling him a fraud for making that claim.

As per a Fortune article on the suit:

Ayyadurai claims that a series of posts on TechDirt amount to libel—in part because the posts call Ayyadurai a “fake email inventor” and a “fraudster” and calls his claims to have invented the technology “bogus.”

Apparently, Ayyadurai created a program that he entitled “EMAIL” around 1978 or 1979. But, according to TechDirt, he merely creating code for one program, and that:

 “does not, in any way, establish him as “the creator” of “the” electronic mail system — merely an electronic mail system — and hardly the first one. I could write some sort of email management software tomorrow and copyright that… and it would no more make me an “inventor” of email than Ayyadurai.

TechDirt’s site references NetHistory for the story of how email was actually created. There is no mention of Ayyadurai, as the foundation had apparently already been laid before Ayyadurai created his program.

Email is much older than ARPANet or the Internet. It was never invented; it evolved from very simple beginnings.

Indeed, the core element of email, the idea by Ray Tomlinson to use the @ symbol, was described merely as a “nice hack” when it was first used in 1972, years before Ayyadurai named his program:

We needed to be able to put a message in an envelope and address it. To do this, we needed a means to indicate to whom letters should go that the electronic posties understood – just like the postal system, we needed a way to indicate an address.

This is why Ray Tomlinson is credited with inventing email in 1972. Like many of the Internet inventors, Tomlinson worked for Bolt Beranek and Newman as an ARPANET contractor. He picked the @ symbol from the computer keyboard to denote sending messages from one computer to another. So then, for anyone using Internet standards, it was simply a matter of nominating name-of-the-user@name-of-the-computer. Internet pioneer Jon Postel, who we will hear more of later, was one of the first users of the new system, and is credited with describing it as a “nice hack”. It certainly was, and it has lasted to this day.

At one point in 2014, the Huffington Post wrote a multi-part story about Ayyadurai  being the inventor of email. While there’s no doubt that Ayyadurai did create an email system, and did obtain a copyright for his particular code, that didn’t make him the inventor of email as you know it. So says TechDirt in its analysis of the article, concluding that the Post stories ignored the fundamental difference between a copyright on the particular code and a patent on the concept:

Copyright was not, and has never been “the equivalent of a patent.” Copyright and patents are two very different things. Copyright protects specific expression. Patents protect inventions. That’s why copyright protected only the specific code that Ayyadurai wrote, rather than the concept of email.

Techdirt acknowledges that Ayyadurai came up with some cool improvements, such as using the shortened word email in place of electronic mail, and making the full address book part of the email system. But that simply  comes under the classification of standing on the shoulders of those that came before you:

Ayyadurai has built up his entire reputation around the (entirely false) claim that he “invented” email. His bio, his Twitter feed and his website all position himself as having invented email. He didn’t. It looks like he wrote an implementation of an email system in 1978, long after others were working on similar things. He may have added some nice features … appears to have potentially been ahead of others in making a full address book be a part of the email system. He may, in fact, be the first person who shortened “electronic mail” to “email” which is cool enough, and he’d have an interesting claim if that’s all he claimed. Unfortunately, he’s claiming much, much more than that. He’s set up an entire website in which he accuses lots of folks, including Techdirt, of unfairly “attacking” him. He apparently believes that some of the attacks on him are because he spoke out against corruption in India. Or because people think only rich white people can invent stuff. None of that is accurate. There’s a simple fact, and it’s that Ayyadurai did not invent email.

TechDirt deserves a vigorous defense. If it doesn’t get that defense, it may go out of business. That is not just bad for the company, it is bad for anyone that believes in free expression.

An important note: Ayyadurai’s counsel is Charles Harder, of California. He’s the one, with bankrolling by Peter Thiel, that brought down Gawker regarding the publication of the Terry Bollea (Hulk Hogan) sex tape. Before the First Amendment issues could be challenged in an appellate court, the $140M verdict sent the company spiraling into bankruptcy.

But don’t think for a second that Harder is infallible. Because he’s also behind the Melania Trump lawsuit where she sued because she was called an escort. And, as I posted recently, I think he screwed the pooch by revealing that Melania wanted to use her new-found high profile to make millions. The negative press was devastating. And I blame the lawyers for that.

The suit is important, very important. Because, while it was easy to laugh at Gawker going down the tubes due to its reprehensible conduct, there were significant First Amendment issues regarding the publication of something that was true, and that Bollea had also made his sex life fodder for discussion.

As Scott Greenfield notes:

There’s no sex tape of Ayyadurai. There’s no ickiness pigeonhole to shove this into. It’s clearly a matter of public interest and concern. And Techdirt isn’t Gawker. At the time, the constitutional “scholars” argued that none of this would happen, there would be no chilling effect. It was just about Gawker, because Gawker, and sex videos because privacy. Nothing to see here, move along.

But Harder figured something out that you didn’t. Or you didn’t want to. He figured out that if you bring a suit, bring it in the right jurisdiction, try to get some home field advantage, a defendant might get Gawkered into submission. In this case, suit was brought in the United States District Court for the District of Massachusetts. That’s where Ayyadurai happens to be. Mike? He’s in California, far, far away.

Thus far, TechDirt has imposed the defense of “In pilleum caca.”(Go shit in a hat.) But it costs money to do that against the very well-funded Harder.

You can donate to the Techdirt Survival Fund here. Please give a few dollars if you appreciate the right to speak freely.

As I know all too well from personal experience, free speech isn’t free. It needs to be defended.

Elsewhere:

What a strange allegation, in alleged-inventor-of-e-mail vs. Techdirt lawsuit (Volokh at Washington Post):

No — a copyright registration for a program named “email” is not the U.S. government recognizing Ayyadurai “as the inventor of email.” No-one at the Copyright Office determines whether a program (or any other work) is a new invention. (Patent examiners may do that, but the Copyright Office doesn’t.) Indeed, no-one at the Copyright Office runs the program, reads the source code, or tries to compare the program’s description to those of other programs.

We Stand With TechDirt and So Should You (Carr at Pando):

Certainly the philosophical connection between Thiel’s attempt to kill Gawker and Ayyadurai’s attempt to silence TechDirt couldn’t be clearer: Both involve wealthy tech moguls using their cash (and Charles Harder) to shut down critical reporting, with the handy side effect that other media outlets are frightened into silence. At the very least, Thiel’s crusade against Gawker has emboldened plaintiffs like Ayyadurai to try to outspend the First Amendment.

But, of course, it barely matters whether TechDirt would win or lose in court — the cost of defending a $15m suit could easily be enough to bankrupt the site before a judge gets a chance to rule.

EFF is Proud to Stand Beside Techdirt in its “First Amendment Fight for its Life.” (Greene @ Electronic Frontier Foundation):

Techdirt is a vital resource – it provides a wide audience with independent journalism addressing some of the biggest technology issues of our time. The Internet community wouldn’t be the same without it. But of course this case is not just about Techdirt. It’s about freedom of the press generally.

Man who claims to have invented email has filed a lawsuit that could put one news website out of business (Hiltzik @ LA Times)

Ayyadurai has pursued his claim to be “the man who invented email” energetically in the news media. Lately he’s taken a new tack: filing lawsuits against news organizations that challenge his claim. His most recent target is a small technology news site called Techdirtand its parent company, the Redwood City research firm Floor64.

The website and its founder Mike Masnick — the author of most of the posts at issue in the case — have moved to have the lawsuit thrown out, partially on the grounds that Ayyadurai is a public figure and his activities are legitimate topics of public interest.

Techdirt says that because of its legal costs, the lawsuit has put it in a 1st Amendment “fight for its life.” In a Jan. 11 blog post aimed at drumming up public and financial support, Masnick wrote, “This fight could very well be the end of Techdirt, even if we are completely on the right side of the law.”

The history of email is capacious enough to accommodate hundreds of inspired engineers and scientists. Ayyadurai merits acknowledgment as a contributor to this rich pageant, especially given the talent he showed at 14. But no one should claim to be the inventor of such a multifaceted, evolutionary system, and Ayyadurai should stop trying.

 

February 15th, 2017

Trials, Trump and Betrayal

The feeling of betrayal is, perhaps one of the most powerful of emotions. It comes up in law all the time, and now it comes up in politics with the Flynn-Russia scandal and Trump’s demonstration that making America great is not exactly his first priority.

Before getting to the significance in politics, a quickie look at how often it comes up in the law, always starting with the premise that two people trusted each other. Without trust, of course, there can be no betrayal.

Betrayal appears with regularity in matrimonial actions, in contract disputes between business partners, and in criminal law with snitches.

Betrayal, in the form of treason, is the only crime defined in our Constitution. Yeah, it’s that strong, since it goes to our own sense of morality.

From my practice area, betrayal probably forms the single most common reason that patients contact lawyers about potential medical malpractice actions. People entrust their lives and health to others, and those others don’t do what was expected of them.

That betrayal forms the basis of an anger that results in the phone being picked up to see how, if at all, someone can get their pound of flesh. And it’s the reason  some doctors are counseled to say “I’m sorry” rather than covering up errors.

And because of this very human emotion, it comes up in literature with great frequency.

Heaven has no rage like love to hatred turned, Nor hell a fury like a woman scorned.  — William Cosgrove

Betrayal is the only truth that sticks. — William Miller
Though those that are betrayed Do feel the treason sharply, yet the traitor Stands in worse case of woe — William Shakespeare

And more, from John Lennon’s son Sean, since it cuts to the heart of what makes for a good story:

There are only really a few stories to tell in the end, and betrayal and the failure of love is one of those good stories to tell.

Since betrayal cuts to the soul, it’s a common theme among trial lawyers that, if used properly, can captivate an audience. It’s a story every judge and juror can relate to. If, at trial, it’s possible to show that one person betrayed the trust of another, you can be 100% certain that a competent trial lawyer will use that theme.

So now we turn to politics and Donald Trump, and bring those trial tactics to a different arena.

It is a given that those who despise Trump will never, ever be disappointed in him. Such people are incapable of being betrayed.

But what of those that believed in him? What of those that bought his hats and shouted his name? Are these not the only ones who can be disappointed, the only ones who can be betrayed?

As the weeks roll on, look to see this concept of betrayal used over and again in the political arena, with the Flynn-Russia scandal, and likely elsewhere. It is one thing for a voter to excuse the conduct of a politician by simply ignoring the boastfulness and hyperbole, but it is altogether different when the hyperbole is supported by conspiring with a foreign power.

Especially when this was the stance of the Trump-Pence administration on February 2nd during a CBS Face the Nation interview:

Look in the future for Trump opponents, be they Democrat or Republican, to pick up this theme, by going directly to Trump’s base of support.

Hell may have no greater fury like a Trump supporter scorned.

 

February 14th, 2017

Class Action Action, Here We Come…

Alison Frankel

We may be in for some serious action on the class action front, due to two big items:

First, legislation has been introduced in the House by Representative Bob Goodlatte that would eviscerate class action law suits. Those suits, started under Federal Rule of Civil Procedure 23 allow numerous people with small claims to group together to bring suit. Because one can’t realistically hire counsel to sue for getting screwed on a defective $10 widget, but if 1,000,000 people get screwed, justice has a good shot at being served.

Or, perhaps, if someone wants to create a phony university about selling real estate with phony promises, the class action is the way that the group can come together for justice against a grifter.

Make no mistake about it, the class action suit is a major factor in empowering the little guy to keep Big Business honest in consumer dealings, and I’m a big fan of them when used right.

As Alison Frankel points out in a Reuters column, however, those class actions are now under a new assault. With Republicans now controlling both houses of Congress and the White House, there is the potential for the courthouse doors to get slammed shut in the faces of consumers.

Since Frankel has already done a great job writing the story up, no need for me to do it again. Read it here.

Next up on the class action front is a potential showdown in the United States Supreme Court on how legal fees are calculated when class actions settle.

Prof. Josh Blackman

In Blackman v. Gascho, the court will face this issue regarding the computation of legal fees: Should a trial court look to the full value of the settlement, as if every person redeems a coupon that may be offered? Or should it be based on how many people actually redeem those coupons (if coupons are used). In other words, on a claims-made basis.

Regular readers know I have been down this path before having been screwed on a class action once. I then proceeded to hire Ted Frank to represent me as an objector, despite him being a tort “reformer.” As Scott Greenfield once pointed out, Frank had now become a plaintiff’s lawyer of sorts, by standing between members of the class and lawyers that he felt (in certain cases) had over-reached on the legal fee.

The issue arose when law professor Josh Blackman — who has been producing constitutional commentary regarding the Trump administration on his blog, twitter and cable shows like a fire hose going full blast — was a class member regarding a gym contract. The gym was sued and the matter settled.

But rather than simply mailing checks to the class members on a pro rata basis, postcards and emails were sent with directions on how to redeem the funds. This, Blackman argues, was designed to lower the actual payout to class members with a low response rate, and thereby give a disproportionate share of the recovery to the lawyers.

While the gym argued that the entire class settlement was $15.5M, thus justifying a $2.39M award of costs and fees, Blackman and Frank contend that they anticipate less than 10% response, and that therefore the funds were paid disproportionately to lawyers instead of class members.

The case is set to be conferenced by the Supreme Court this coming Friday, February 17th, to decide if cert should be granted.

If cert is granted, and the Goodlatte bill moves forward, expect class action discussions to come to the forefront of legal discussion.