With great fanfare, President Bush announced yesterday a new program that would freeze adjustable rate mortgage increases on subprime mortgages. Sounds great, until you review the fine print.
The freeze in rate increases is only available for those with subprime mortgages. Further, it is only available for those who are current on their mortgages and only if there has been no increase already.
A number of lenders went to great lengths to lend money, including using artificially lower interest-only adjustable rate mortgages, mortgages with tremendous balloons, and artificially discounted teaser rates.
The Bush plan applies to an estimated 10 to 15 percent of borrowers who are at risk of foreclosure. That's thin, at best.
At the same time, regulation of lending is lax at best. Oregon, for example, sets no legal underwriting standards. Oregon allows lenders to penalize early payment. Oregon allows refinancing even when doing so does not benefit the lender.
For those who qualify, the President's provision may provide some breathing room. On the other hand, it may merely create future problems for those who get the benefit of the freeze. Regardless, you have to wonder what they were intending to do when they created this great bailout for 10 percent of consumers who are at risk.
David F. Sugerman
Paul & Sugerman, PC
www.pspc.com
Friday, December 7, 2007
Thursday, December 6, 2007
Ford Recalls SUVs, Vans and Trucks for Engine Flaw
Through the National Highway Transportation Safety Administration, Ford announced the recall of some 1.2 million SUVs, vans and trucks for an electrical system problem that can cause engine stalls. According to the NHTSA web site, the camshaft position sensor located on the engine of the vehicle may function intermittently, possibly resulting in an engine stall and crash.
Affected vehicles are equipped with the 7.31 diesel engine for the Ford E Series, Excursion, F-450 Superduty and F-550 Superduty for model years 1997-2003.
David F. Sugerman
Paul & Sugerman, PC
www.pspc.com
Affected vehicles are equipped with the 7.31 diesel engine for the Ford E Series, Excursion, F-450 Superduty and F-550 Superduty for model years 1997-2003.
David F. Sugerman
Paul & Sugerman, PC
www.pspc.com
Federal Jury Finds for Oregon Welder in Toxic Injury Case
A federal jury in Cleveland, Ohio found that an Oregon welder suffered serious injuries from exposure to toxic welding fumes. For years, welders have claimed that manganese fumes from welding causes profound damage to the nervous system. The problems appear similar to Parkinson's disease, with brain damage that affects movement and memory.
Approximately 3,000 cases are pending in Cleveland. Previously, the manufacturers had won most cases; however, the multi-million dollar verdict in this case may represent a turning point in the litigation.
In this era of mass-production, when many people are injured by the same misconduct, there seems to be a fairly predictable pattern in litigation. In almost all cases, the company wins the early cases because it is hard for injured consumers to fully investigate and understand what happened. Later cases build upon the early failures, and consumers or workers often break through with a major victory. At that point, it is not unusual for consumers and workers to achieve a critical mass that allows them to establish higher and higher verdict values by repeatedly trying cases for the same injuries.
Perhaps this is victory represents a turning point for welding workers who are seeking justice.
David F. Sugerman
Paul & Sugerman, PC
www.pspc.com
Approximately 3,000 cases are pending in Cleveland. Previously, the manufacturers had won most cases; however, the multi-million dollar verdict in this case may represent a turning point in the litigation.
In this era of mass-production, when many people are injured by the same misconduct, there seems to be a fairly predictable pattern in litigation. In almost all cases, the company wins the early cases because it is hard for injured consumers to fully investigate and understand what happened. Later cases build upon the early failures, and consumers or workers often break through with a major victory. At that point, it is not unusual for consumers and workers to achieve a critical mass that allows them to establish higher and higher verdict values by repeatedly trying cases for the same injuries.
Perhaps this is victory represents a turning point for welding workers who are seeking justice.
David F. Sugerman
Paul & Sugerman, PC
www.pspc.com
Friday, November 30, 2007
Supreme Court Considering Far-Reaching Cases This Term
I remember as kid growing up in Texas that a generalized fear settled in when the Texas legislature convened every other year for its regular sessions. The general sentiment of those of us who didn't own oil wells, ranches or corporations was, "Quick, nail everything down tight. They're going back into session."
When it comes to consumer safety, it may be that the U.S. Supreme Court will come to resemble the Texas legislature. This term, the Court considers whether federal regulations will preempt state law claims in injury cases.
What does that mean?
Preemption is a legal term that describes the relationship between federal law and the laws of the states. Because federal law is supreme, Congress can make laws that displace state rules. Sometimes this is a good thing. For example, without preemption, states would be free--if they chose--to allow slavery. That, of course, is unacceptable.
Unfortunately, preemption can also be used to eliminate consumers' access to the courts. In the pending case of Riegel v. Medtronic, Inc., the Court will hear a claim from the manufacturer of a potentially dangerous catheter that it should not face a claim from a consumer who died when the product malfunctioned, even if it was defectively designed. Medical equipment manufacturers are relying on the Medical Device Amendments, claiming that Congress eliminated the rights of injured consumers to sue for damages when injured by careless manufacturers.
Maybe the Court will steer by principle and stick with the well-developed rules that consumers retain the ability to have a jury decide whether the manufacturer was in the wrong. Or maybe it's a new era reminiscent of the Texas legislature. The Court hears argument in early December, with a decision expected by June.
David F. Sugerman
www.pspc.com
Paul & Sugerman, PC
When it comes to consumer safety, it may be that the U.S. Supreme Court will come to resemble the Texas legislature. This term, the Court considers whether federal regulations will preempt state law claims in injury cases.
What does that mean?
Preemption is a legal term that describes the relationship between federal law and the laws of the states. Because federal law is supreme, Congress can make laws that displace state rules. Sometimes this is a good thing. For example, without preemption, states would be free--if they chose--to allow slavery. That, of course, is unacceptable.
Unfortunately, preemption can also be used to eliminate consumers' access to the courts. In the pending case of Riegel v. Medtronic, Inc., the Court will hear a claim from the manufacturer of a potentially dangerous catheter that it should not face a claim from a consumer who died when the product malfunctioned, even if it was defectively designed. Medical equipment manufacturers are relying on the Medical Device Amendments, claiming that Congress eliminated the rights of injured consumers to sue for damages when injured by careless manufacturers.
Maybe the Court will steer by principle and stick with the well-developed rules that consumers retain the ability to have a jury decide whether the manufacturer was in the wrong. Or maybe it's a new era reminiscent of the Texas legislature. The Court hears argument in early December, with a decision expected by June.
David F. Sugerman
www.pspc.com
Paul & Sugerman, PC
Thursday, November 29, 2007
Comcast Loses Another Arbitration Clause Case
In September 2007, the U.S. Court of Appeals for the 11th Circuit followed a clear trend when it ruled that Comcast could not enforce its mandatory arbitration clause against subscribers who brought an overcharge case against Comcast. In Dale v. Comcast Corp., 498 F.3d 1216 (11th Cir. 2007), the Court ruled that the arbitration clause was unconscionable and unenforceable because it made consumers’ pursuit of claims nearly impossible.
The case is part of a growing trend in which federal and state courts are scrutinizing mandatory arbitration clauses. Full disclosure: Paul & Sugerman represents consumers in litigation against Comcast and has successfully fought the Comcast arbitration clause in Oregon. That case--Martin v. Comcast--is still pending.
The problem with mandatory arbitration clauses is that they are often one-sided and unfair. A requirement that both parties go to arbitration isn’t necessarily so bad IF both sides agree. But often these clauses are buried in fine print. Worse, they frequently contain other provisions that hurt consumers, like limits on recovery of attorneys fees, prohibitions on class actions, and elimination of certain types of damages. The one-way clause often includes a choice of arbitration services that favor large corporations. In the end, it’s often about as fair as a rigged ring toss at a carnival.
It’s nice to see things turning back toward the middle. This is one area in which the pendulum went way out of whack.
David F. Sugerman
www.pspc.com
Paul & Sugerman, PC
The case is part of a growing trend in which federal and state courts are scrutinizing mandatory arbitration clauses. Full disclosure: Paul & Sugerman represents consumers in litigation against Comcast and has successfully fought the Comcast arbitration clause in Oregon. That case--Martin v. Comcast--is still pending.
The problem with mandatory arbitration clauses is that they are often one-sided and unfair. A requirement that both parties go to arbitration isn’t necessarily so bad IF both sides agree. But often these clauses are buried in fine print. Worse, they frequently contain other provisions that hurt consumers, like limits on recovery of attorneys fees, prohibitions on class actions, and elimination of certain types of damages. The one-way clause often includes a choice of arbitration services that favor large corporations. In the end, it’s often about as fair as a rigged ring toss at a carnival.
It’s nice to see things turning back toward the middle. This is one area in which the pendulum went way out of whack.
David F. Sugerman
www.pspc.com
Paul & Sugerman, PC
Tuesday, November 20, 2007
Tired Screed: Romney Wants to Thwart Injured Patients
Ah yes, it's campaign season again. And we have another politician calling for, "federal caps on non-economic and punitive damages related to malpractice" because, "lottery-sized awards and frivolous lawsuits may enrich the trial lawyers but they put a heavy burden on doctors, hospitals and, of course through defensive medicine, they put a burden on the entire health care system."
This time it's Mitt Romney. Cite to the article for further detail: http://www.salon.com/wires/ap/2007/11/20/D8T1MFNO2_romney_health_care/index.html
I don't know where to start. First, with the irony. I thought Gov. Romney was a conservative, but here he wants regulation and a one-size-fits-all federal standard for all patients injured by physician neglect.
The bigger problem is that Gov. Romney either knows nothing about profound injury or--worse--he knows it well, but wants to treat patients' rights as a political issue. There are bigger policy problems. To begin with, punitive damages in medical cases are so rare as to be almost non-existent. They are awarded in the rare case when a surgeon--who is drunk--commits a surgical error or when a doctor who is a pervert sexually abuses a patient. Most doctors and nurses are honorable and good people, and that is why the punitive damage problem is rare.
And then there's the lottery argument. For a buck or two, you can play the lottery in most states. You're likely to lose but if you win, you'll be a multi-millionaire. To "play the lottery" in a medical malpractice case, you need a profound injury--often it's as serious as death, or a life in a wheelchair. No matter what happens you will be that way for life because of a mistake made by an inattentive doctor. That's a tragedy, not a lottery. Anyone who confuses the two does not understand the devastation caused by profound injuries.
And then there's frivolous lawsuits. This is a phrase that really means, "We don't trust juries." For according to Gov Romney and others, juries can't tell when a lawsuit has merit, and they will literally shower the fraudulent party with a torrent of cash. I've been trying cases for over 20 years. Maybe I'm just not a very good lawyer, but it's pretty clear that juries have plenty of sense when it comes to ferreting out good claims and bad ones. Or maybe Gov. Romney and those who rant about the "crisis" have a different agenda.
In the end, it's easy to trust the jury. Our ancestors set up the jury trial system to protect us against politicians and titans. Let's not mess with it, as they knew what they were doing.
David F. Sugerman
www.pspc.com
Paul & Sugerman, PC
This time it's Mitt Romney. Cite to the article for further detail: http://www.salon.com/wires/ap/2007/11/20/D8T1MFNO2_romney_health_care/index.html
I don't know where to start. First, with the irony. I thought Gov. Romney was a conservative, but here he wants regulation and a one-size-fits-all federal standard for all patients injured by physician neglect.
The bigger problem is that Gov. Romney either knows nothing about profound injury or--worse--he knows it well, but wants to treat patients' rights as a political issue. There are bigger policy problems. To begin with, punitive damages in medical cases are so rare as to be almost non-existent. They are awarded in the rare case when a surgeon--who is drunk--commits a surgical error or when a doctor who is a pervert sexually abuses a patient. Most doctors and nurses are honorable and good people, and that is why the punitive damage problem is rare.
And then there's the lottery argument. For a buck or two, you can play the lottery in most states. You're likely to lose but if you win, you'll be a multi-millionaire. To "play the lottery" in a medical malpractice case, you need a profound injury--often it's as serious as death, or a life in a wheelchair. No matter what happens you will be that way for life because of a mistake made by an inattentive doctor. That's a tragedy, not a lottery. Anyone who confuses the two does not understand the devastation caused by profound injuries.
And then there's frivolous lawsuits. This is a phrase that really means, "We don't trust juries." For according to Gov Romney and others, juries can't tell when a lawsuit has merit, and they will literally shower the fraudulent party with a torrent of cash. I've been trying cases for over 20 years. Maybe I'm just not a very good lawyer, but it's pretty clear that juries have plenty of sense when it comes to ferreting out good claims and bad ones. Or maybe Gov. Romney and those who rant about the "crisis" have a different agenda.
In the end, it's easy to trust the jury. Our ancestors set up the jury trial system to protect us against politicians and titans. Let's not mess with it, as they knew what they were doing.
David F. Sugerman
www.pspc.com
Paul & Sugerman, PC
Wal-Mart Raids Profoundly Injured Employee's Settlement Funds
Some things are beyond comprehension. Comes today's news, in the Wall Street Journal no less, that Wal-Mart sued a catastrophically-injured former employee for reimbursement of medical expenses. Here is a link to article: http://online.wsj.com/article/SB119551952474798582.html?mod=todays_us_nonsub_page_one
Reported on the front page, November 20, 2007, is the horrifying story of a woman who worked for Wal-Mart and received her health insurance through her employer. A big rig, with insufficient insurance, collided with her mini-van, and Deborah Shank was left brain damaged and confined to a wheel chair.
With the help of a lawyer, Mrs. Shank and her family settled her claim. The settlement wasn't enough to take of her future medical needs, but it would have made a big difference in her future. And then Wal-Mart sued to be reimbursed for the money it had paid for her prior care.
Wal-Mart claimed an entitlement to every dollar that it paid even though it didn't hire or pay for the lawyer that got the settlement for the Shank family. Wal-Mart claimed an entitlement to repayment even though the trucking company's insufficient insurance did not cover all of Mrs. Shank's harms and losses.
There is something very wrong with a system that allows an employer with Wal-Mart's resources to step in and claim every penny while the injured person is left penniless and without care. The story relates that the Shanks divorced so that she could receive greater public assistance as a single woman.
So the law that allows Wal-Mart full reimbursement means that taxpayers foot the bill for Mrs. Shank's care. Mrs. Shank did everything right. She worked, had insurance and didn't cause the devastating crash. The trucking company skates, Wal-Mart gets more money, Mrs. Shanks suffers without care, and we get the bill.
Go figure.
David F. Sugerman
www.pspc.com
Paul & Sugerman, PC
Reported on the front page, November 20, 2007, is the horrifying story of a woman who worked for Wal-Mart and received her health insurance through her employer. A big rig, with insufficient insurance, collided with her mini-van, and Deborah Shank was left brain damaged and confined to a wheel chair.
With the help of a lawyer, Mrs. Shank and her family settled her claim. The settlement wasn't enough to take of her future medical needs, but it would have made a big difference in her future. And then Wal-Mart sued to be reimbursed for the money it had paid for her prior care.
Wal-Mart claimed an entitlement to every dollar that it paid even though it didn't hire or pay for the lawyer that got the settlement for the Shank family. Wal-Mart claimed an entitlement to repayment even though the trucking company's insufficient insurance did not cover all of Mrs. Shank's harms and losses.
There is something very wrong with a system that allows an employer with Wal-Mart's resources to step in and claim every penny while the injured person is left penniless and without care. The story relates that the Shanks divorced so that she could receive greater public assistance as a single woman.
So the law that allows Wal-Mart full reimbursement means that taxpayers foot the bill for Mrs. Shank's care. Mrs. Shank did everything right. She worked, had insurance and didn't cause the devastating crash. The trucking company skates, Wal-Mart gets more money, Mrs. Shanks suffers without care, and we get the bill.
Go figure.
David F. Sugerman
www.pspc.com
Paul & Sugerman, PC
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