THE REFORMINATOR SIGNS TORT REFORM BILL INTO LAW

Everyone’s favorite movie star/governor, the aptly titled “Governator”, has become the “Tort Reforminator” this week.  According to an article on Law.com, Governor Schwarzenegger signed a bill into law this week that prevents a victim  of negligence from suing someone who stops to help them at the scene of an accident, unless the tortfeasor’s actions at the scene rise to the level of gross negligence or recklessness.  The bill was pushed by the Civil Justice Association of California, a tort reform group whose members include Allstate, AIG, and State Farm (obviously a group that looks out for everyday people).

A member of one of the groups sponsoring the bill, Christine Spagnoli was quoted as saying: “The bar has been set higher…  People who do something and unintentionally cause additional harm aren’t going to be faced with having to be potentially sued.”  Christine then gives the following example to illustrate how the new bill works: if a drunk driver stops at an accident scene, puts a victim in his car and wrecks it, his actions could rise to gross negligence – he could be sued.  If a sober driver rescues someone from an accident scene and crashes into someone while racing to the hospital, they might not be liable under this new law.

The bill provides protection to insurance companies.  If the sober driver in scenario number two is driving like a maniac and hurts someone, the fact that he just rescued someone at another accident scene should not shield his insurance company from paying for his negligence.  This bill does not protect good samaritans, it protects the good samaritan’s insurance company and prevents the injured party from recovering from the insurance company to pay for their medical expenses.   Good job protecting ”helpless” insurance companies like AIG, Herr Governator!

 

GM MAKES CONCESSIONS ON LIABILITY CASES IN BANKRUPTCY

According to Bloomberg, GM has accepted that liabilities for past products, manufactured by the bankrupt GM will stay with the new company which will be formed in the bankruptcy proceeding.  To quote the story:

GM “amended the sale agreement to clarify that it will take on some tax and workers’ compensation claims, maintain utility service to plants being left behind and accept future product liability and lemon law claims. That should significantly alleviate objectors’ concerns.”

That is good news for consumers: there will be a responsible party to pay for damages caused by the “old” GM’s negligence.  However the changes GM agreed to do not cover thousands of asbestos claims pending against the company.  Those claims would stay with the bankrupt entity, which would mean thse claimants will receive nothing.  In addition the agreement says that only claims arising after a new company is formed will be handled by the new company, meaning pending claims will stay with the bankrupt estate.

The Treasury-funded company, Vehicle Acquisition Holdings LLC, is the only potential buyer for GM.  The government’s goal for the company is to have the sale closed in 90 days.

 

JURY AWARDS $1.5 MILLION IN HOME DEPOT ACCIDENT CASE

A jury in Cobb County, Georgia awarded a Home Depot customer $1.5 million for an accident that happened in 2005, according to a story on AJC.com.  The plaintiff, Larry Reece was injured when a pallet full of plywood fell from a forklift, 24 feet above the ground.  Reece was trapped under the wood after the accident.

The victim suffered from neck and spinal injuries and underwent surgery to repair herniated discs.  The medical expenses for the surgery to repair the disc injury were over $120,000.  Home Depot has faced numerous claims over the years from those injured by its “sky shelving”, merchandise packed on shelves high above the aisles where customers walk.

 

RECALLS ON LAJOBI “BABI” & “BONAVITA” CRIBS

The CPSC announced that LaJobi, Inc. is recalling two of its crib models, the Bonvita Hudson crib and the Babi Italia Pinehurst crib.  The lower spring pins on the foot-board and headboard of the cribs can pop off track on the drop-side, causing the dropside to detach from the crib.  When the dropside comes off, a hazardous gap is created between the side of the crib and the mattress, where infants can become entrapped and suffocate or fall out of the cribs.

About 2,900 of the cribs were sold between December 2006 and December 2007, at Babies R Us, Baby Basics, Beautiful Beginnings, Buy Buy Baby, and other children’s products stores nationwide.  The cribs were manufactured in China.

There have been 33 reports of spring pin failure in these cribs, including two reports of children becoming entrapped in the cribs and one report of a child falling from the cribs.  The CPSC says anyone owning one of these cribs should discontinue using the cribs immediately, and contact LaJobi (website is linked here), who will provide a technician to perform installation of a free retrofit hardware kit.

 

ASBESTSOS CLAIMANTS WANT SEAT AT GM BANKRUPTCY TABLE

According to a story on Bloomberg.com, asbestos personal injury claimants say the current bankruptcy plan to sell GM’s best assets to a new company may be unconstitutional, if asbestos claimants are left out of the decision making process.  GM had liability for over $600 million in legal claims related to asbestos in both 2007 and 2008.  That amount is not expected to start declining for several years.     

The Hill is reporting that both the GM and Chrysler bankruptcies will be structured to eliminate all future liability for injury claims related to vehicle defects.  This would include physical injuries caused by defective vehicle parts, such as vehicle rollover claims, as well as injury caused by asbestos. 

Victims with current claims are petitioning Congress to build in protections for the injured into the bankruptcy plans for these companies and filing petitions with the Supreme Court to delay the bankruptcies, which are currently on a fast track. 

According to CNN, the Supreme Court issued a stay order on Monday in the Chrysler bankruptcy, preventing the sale of their most valuable assets to a new company, partially owned by Fiat.  An Indiana state pension fund filed the request to delay approval of the bankruptcy because it felt it was not receiving fair treatment under the proposed plan.

EDIT:  CNN is reporting that the Supreme Court approved the Chrysler bankruptcy plan and the Fiat/Chrysler partnership is going through, with Fiat obtaining a 20% stake in the new company, Chrysler Group LLC.

 

SETTLEMENT IN WAL-MART WAGES AND HOURS LAWSUIT

The parties have agreed to a $54 million settlement in a lawsuit brought by Wal-Mart workers in Minnesota, according to a story in the LA Times.  The workers claimed that Wal-Mart cut their break times and allowed employees to work off the clock.  The judge in the case said Wal-Mart violated the law more than 2 million times by denying workers their break time and forcing workers to work off the clock for no pay.  Wal-Mart faced possible fines of $2 billion in the case. 

According to Walmartwatch.com, in late December 2008 Wal-Mart announced it would settle 63 wage and hour lawsuits pending against it, about 86% of the total lawsuits pending against it on this issue.  The website says these suits have uncovered a corporate culture of cutting costs by hiring below the preferred staffing levels and rewarding managers for keeping labor costs down.  The Minnesota lawsuit outlines some of the preferred methods used to keep costs low. 

The settlement is available for 100,000 workers who worked at Wal-Mart stores in Minnesota between the years 1998 and 2008.

 

MATTEL AGREES TO PAY $2.3 MILLION FINE FOR LEAD TOY HAZARD

Story on Bloomberg.com reportsMattel has agreed with the CPSC to pay a $2.3 million fine for importing toys containing dangerous levels of lead.  The fine relates to 95 of the company’s toy models, including Barbie toys and “Cars” toys. 

The CPSC reported that Mattel imported 900,000 toys between September 2006 and August 2007 that violated lead standards.  These products were imported from China.  As a result of these findings, Mattel recalled more than 21 million toys made in China, after they were found to contain high levels of lead or dangerous designs.

The lead situation is not the only problem related to Chinese imports.  As reported here, there have been recent recalls of dangerous Chinese milk products and medical products.

 

$2.185 MILLION AWARD IN MEDICAL MALPRACTICE CASE

The family of a Philadelphia man who passed away in 2006 was awarded a verdict of $2.185 Million after a jury found two doctors and a hospital liable for medical malpractice, according to a story on philly.com. 

Zachary James, the decedent, presented to the hospital with chest, back and leg pains.  Tests were ordered in the emergency room, but it took two hours for some of the tests to be performed.  About two hours into the event, the lead emergency room doctor left the emergency room for a meeting, leaving a doctor who was starting his first day in the emergency room as the only physician in the emergency room.  The new doctor was supposed to be in orientation and not left alone to handle the emergency room by himself. 

X-rays were taken of Ms. James, but were not read in the emergency room when they were developed.  Hospital procedure dictated ER physicians were to read the x-rays immediately.  Instead, the x-rays were sent to radiology where they were reviewed the next day. 

Mr. James passed away after spending eleven hours in the emergency room with no diagnosis.  He had a dissecting aortic aneurysm, a tear in the wall of the aorta that allows blood to flow between the aorta wall’s layers, and can result in a rupture of the wall, and death. 

The defense argued that even if the hospital Emergency Room physicians had quickly identified Mr. James’ condition, there still may not have been enough time to transfer him to another hospital to perform a life saving surgery.  The jury found the two doctors 84% liable and the hospital 16% liable for the damages.

 

NEW AUTO SAFETY REQUIREMENTS: SAFER ROOFS MEAN FEWER ROLLOVER DEATHS

The Federal Government is mandating new safety standards for automobile roofs, the first such new standards in thirty years, according to the New York Times Wheels Blog.  Automobiles are currently required to have roofs that can withstand pressure equal to one and a half times the vehicle’s curb weight, with that pressure applied to one side of the roof only, up to a six thousand pound maximum.  Vehicles over 6,000 pounds are not currently regulated.

The new standard, to be implemented by the National Highway Traffic Safety Administration, is that the vehicle’s roof must be able to withstand three times the weight of the vehicle, with pressure applied first to one side of the roof and then to the other side of the roof.  Safety experts claim that the two sided test better approximates the conditions a vehicle experiences in a roll over situation.  The new standard also removes the six thousand pound cap on vehicles and brings vehicles in the 6,000 to 10,000 pound range under the regulations.

The NHTSA hopes that the tougher standard will prevent deaths from rollover crashes.  The Administration’s data shows 10,000 deaths annually from rollover crashes, under the current standard.  In the Administration’s press release, Transportation Secretary Ray Lahood states, “These new standards go a long way toward reducing deaths, but safety belts are the first, most important step everyone should take to protecting themselves and their families.” 

The phase in for the new requirements begins in September 2012.  The Administration has also mandated electronic stability control systems which will also help to prevent rollovers from occurring.

 

FDA WARNS CONSUMERS ABOUT HAZARDS OF HYDROXYCUT

According to a story in the LA Times, the Food and Drug Administration is recommending that consumers should immediately stop taking the dietary supplement product, Hydroxycut.  The product is manufactured by Iovate Health Sciences Inc.  The company has agreed to recall the product from the market.

Hydroxycut products are dietary supplements that are used as weight loss products, such as fat burners, energy enhancers, low carb diet aids, and water loss aids.  The list of recalled products includes: 

Hydroxycut Regular Rapid Release Caplets
Hydroxycut Caffeine-Free Rapid Release Caplets
Hydroxycut Hardcore Liquid Caplets
Hydroxycut Max Liquid Caplets
Hydroxycut Regular Drink Packets
Hydroxycut Caffeine-Free Drink Packets
Hydroxycut Hardcore Drink Packets (Ignition Stix)
Hydroxycut Max Drink Packets
Hydroxycut Liquid Shots
Hydroxycut Hardcore RTDs (Ready-to-Drink)
Hydroxycut Max Aqua Shed
Hydroxycut 24
Hydroxycut Carb Control
Hydroxycut Natural

To date, 23 consumers have reported serious liver problems related to Hydroxycut.  One death due to liver failure has been reported (according to CNN.com a 19 year old died in 2007) and others have reported liver damage so severe that it required liver transplant.  Symptoms of liver injury include jaundice, brown urine, nausea, vomiting, light-colored stool, excessive fatigue, weakness, stomach/abdominal pain, itching and loss of appetite. 

Other health problems reported to the FDA include seizures, cardiovascular disorders, and rhambdomyolysis (muscle damage that can lead to kidney failure).