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Cruise line must pay 93A damages to consumers who cancelled

In a victory for consumers in Massachusetts, Norwegian Cruise Lines was ordered by the Supreme Judicial to pay damages, reasonable attorneys’ fees, and costs.

Plaintiffs brought an action against defendant, seeking a refund of two cruise tickets they purchased and cancelled following concerns about the September 11, 2001 terrorist attacks. The plaintiffs received their tickets for a cruise scheduled to depart on September 16, 2001. After the terrorist attacks of September 11, 2001, the Casavants, fearful of taking a cruise that was scheduled to depart from Boston on September 16, contacted Norwegian several times in an effort to reschedule it. Norwegian refused to reschedule their trip, deemed them to have cancelled their voyage, and refused to refund the price of the tickets. The plaintiffs subsequently retained counsel and sent Norwegian a demand letter pursuant to G.L. c. 93A, § 9(3), dated August 22, 2002, claiming that they were entitled to a refund of the price of the tickets plus interest and attorney’s fees based on a number of unfair and deceptive acts and practices on the part of Norwegian that violated G.L. c. 93A, §§ 2 and 9.

The case took nearly 10 years to work its way through the Massachusetts court system, including two trips to the appellate courts. But the plaintiffs were awarded with a victory by the Massachusetts Supreme Judicial Court. The court opinion detailing the background and history of the case can be viewed by clicking here.

The court ruled that the evidence at trial plainly established that defendant violated the Attorney General’s travel service regulations in two respects: fist, it failed to disclose the refund policy; and second, having violated the disclosure statement, it failed to refund the payments made by a cancelling customer within thirty days. These violations qualified as unfair or deceptive acts, and they caused plaintiffs a loss: the lack of a prompt refund of the ticket price.

The court also concluded that plaintiffs’ demand letter satisfied the requirements of G.L.c. 93A, section 9(3). The purposes of the demand letter were sufficiently fulfilled where it constituted fair notice of the claim and enabled defendant to make a reasonable tender of settlement.

New bill would aid seniors with Medicare liens

Last July, we wrote about a legal pitfall which hampered recovery for our elderly clients. You can read that post by clicking here. In the piece, we noted that the Medicare Secondary Payor statute (MSPS) presents perils for plaintiffs, defendants, attorneys, and insurance carriers. For many reasons, the Medicare Secondary Payer Act is riddled with inefficiency.

Established in the 1980’s, the act was designed to reimburse the Medicare Trust Fund if another insurance or compensation source is available to pay for health care costs. The intent was to keep Medicare solvent, but the result is that Medicare patients are unable to receive timely information from the Center for Medicare Services (CMS) and as a result, they are not receiving their settlements since insurers and others cannot compensate the Medicare patient until CMS is reimbursed. Their money can be tied up for years due to the inefficiency of the MSP system, and many seniors die waiting for compensation that would improve the quality of their lives.

New legislation pending before Congress may help. HR 4796 would correct many of the problems by requiring the Center for Medicare Services (CMS) to respond to requests for their lien amount within 60 days. Self-funded by a $30 application fee, this bill costs the taxpayers nothing, and it has the broad support of coalitions including the National Retail Federation, the United Chamber of Commerce, and Allstate Insurance. You can read the United Chamber’s letter of support by clicking here.

You can help move this important legislation towards passage by asking your Member of Congress to cosponsor HR 4796. Here is a sample letter you can send:

Seniors are facing an injustice that Congress can correct. The Medicare Secondary Payer System (MSP) established in the 1980’s was designed to reimburse the Medicare Trust Fund if another insurance or compensation source is available to pay for health care costs. For example, if a Medicare patient receives medical treatment for an injury, and that injury is determined to be covered under workers’ compensation, auto or other liability insurance, Medicare is reimbursed for the medical bills they paid on behalf of the Medicare patient for the injury. The intent was to keep Medicare solvent, but the result is that Medicare patients are unable to receive timely information from the Center for Medicare Services (CMS) and as a result, they are not receiving their settlements since insurers and others cannot compensate the Medicare patient until CMS is reimbursed. Their money can be tied up for years due to the inefficiency of the MSP system, and many seniors die waiting for compensation that would improve the quality of their lives.

Adding to this problem is the fact that when CMS finally does respond, it often includes charges that were not specific to the injury and that it cannot be reimbursed for legally! Then CMS prohibits the patient from receiving any Medicare benefits until the erroneous total is paid! This lengthy back and forth draws out the process even longer, leaving seniors facing life with no Medicare coverage. The agency has even been known to garnish seniors’ Social Security benefits over this.

HR 4796, the Medicare Secondary Payer Enhancement Act would correct this problem by requiring CMS to respond to requests for reimbursements within 60 days. Self-funded by a $30 application fee, this bill costs the taxpayers nothing, and it has the broad support of coalitions including the National Retail Federation and Allstate Insurance.

Help seniors. Become a cosponsor of HR 4796 today.

Jury hammers saw manufacturer over severed fingers

According to the Boston Globe, a jury in the United States District Court in Boston has awarded $1.5 million to a Malden man who injured his fingers on a saw while installing oak wood flooring several years ago in a first of its kind case that claimed the standard design of American table saws is defective.

Carlos Osorio accused One World Technologies Inc., maker of Ryobi saws, of negligence for failing to include a flesh detection technology that would prevent most serious injuries, according to a copy of the complaint filed in 2006. You can view a copy of the complaint by clicking here. This safety system will stop the blade within 5 milliseconds of detecting contact with skin, and the jury ruled that the defendant should have incorporated this device into the saw’s design. You can view a video of the technology in action and more detail on the technology by clicking here.

Osorio’s case is one of more than 50 lawsuits pending throughout the United States against the major table saw manufacturers for failure to adopt the technology.

For the complete story in the Globe, click here.

Medicare liens are a pitfall for elderly plaintiffs

A few years ago, we wrote about the evils of subrogation from health insurance contracts any impact on personal injury judgments and settlements. You can view that piece by clicking here. For our elderly clients, there is yet another obstacle in the battle to achieve justice and that is the Medicare lien. Indeed, the Medicare Secondary Payor statute (MSPS) presents perils for plaintiffs, defendants, attorneys, and insurance carriers.

The law authorizes Medicare to seek reimbursement of medical payments made on behalf of an individual who is injured and later obtains recovery from a third party. Plaintiff’s attorneys are responsible for sorting out when and whether Medicare must be reimbursed for those payments in any given case. Problems arise mainly in cases when a compromise settlement may leave the plaintiff little or nothing after paying expenses and the Medicare lien. The problem is multiplied by the fact that it is difficult to get the government to provide the amount of the lien. It is not unusual to take months and even years to get a final number from the Federal government on the Medicare lien.

Medicare liens are administered by Centers for Medicare & Medicaid Services (CMS). Formerly known as the Health Care Financing Administration (HCFA), CMS is the federal agency responsible for administering the Medicare, Medicaid, CHIP (Children’s Health Insurance), HIPAA (Health Insurance Portability and Accountability Act), CLIA (Clinical Laboratory Improvement Amendments), and several other health-related programs. As attorneys for elderly clients, we contact CMS early on in a case seeking the amount due. But the federal agency takes the position that it “cannot supply the amount due until settlement or judgment has been reached because until one of those results has come about, there is technically no primary payer and thus no debt owed.” On top of that, the agency requires a myriad of forms and releases to be executed by the attorney and client just to establish communication. Now that’s federal bureaucracy for you. And that bureaucracy is not only hindering resolution of cases, it causes plaintiff’s attorneys to shy away from cases and clients may involve Medicare.

An article which highlights the pitfalls associated with Medicare liens can be found by clicking here. As noted in the article, Medicare can be extremely slow to tell them what its share of the settlement should be, taking several months and as much as a year or more. That can prevent them from engaging in damage negotiations with the liable party’s insurer, or from reaching an agreement and distributing the money if they already have. The article portrays an agency which does not seem to care that they are preventing elderly clients from seeing the proceeds of their personal injury cases.

While it may seem fair for the government to seek recovery from cases, a more orderly procedure needs to be developed by the government for speedy resolution of claims and greater communication with lawyers for claimants. Until this orderly process put in place, elderly clients may go without legal representation, and may have to forgo seeking redress for their injuries altogether. That will result in an inability to seek justice on behalf of elderly clients, and will leave the Medicare system unreimbursed for costs paid. Let’s hope that any efforts at health care reform include revisions to these bureaucratic nightmares.

Unused gift card money plucked by state governments

The Wall Street Journal reported today that some states faced with sinking tax collections and rising debt are going after unused gift cards that bolster their revenue. You can view the article by clicking here.

South Carolina is considering legislation that would give the state the right to collect unclaimed gift-card credit. A similar measure in Texas to allow the collection of unused credit even from cards that have no expiration date passed that state’s House this spring and stalled in the Senate. Texas already collects unused gift cards with expiration dates.

According to the WSJ report, each year Americans spend about $65 billion in gift cards — excluding bank-issued prepaid cards — but don’t redeem $6.8 billion.

This story brings up yet another host of issues involving the gift card industry. We have been writing about problems associated with gift cards for several years. We have highlighted issues with dormancy fees, bankruptcies, and gift card litigation. Click here for a collection of our posts on gift cards.

Bankruptcies could leave injured consumers out in the cold

With bankruptcy proceedings for Chrysler and GM advancing quickly, consumer groups have worked hard to ensure that Americans harmed by defective vehicles are not left out of the process. Unfortunately, Chrysler’s sale to Fiat included language relieving the Italian company from liability claims on vehicles made before the sale. The current GM bankruptcy plan could include similar liability immunity.

Last week, victims of defective vehicles went to Washington, DC to urge Congress to consider their plight while deciding the future of these corporations. Several stories ran in local and national news. You can see them on the American Association for Justice’s Dangerous and Defective Products page by clicking here.

What this means for consumers is simply that if a car owner who bought a vehicle before the company reorganization sustained injuries because of faulty brakes, Chrysler would pay for the brakes but not the medical cost of treating the injuries.

Currently, Chrysler would emerge from the controlled bankruptcy “tort free.” It would gain blanket immunity from any and all defects on millions of vehicles sold in the past several years. Those defects include seatbelts that don’t work, seat backs that collapse, vehicles that are unstable and flip over too readily, roofs that cave in, and gasoline tanks that are improperly positioned and are prone to catching fire.

You can see a number of stories about a number of consumers who would be adversely affected by clicking here.

NY Times exposes DME scams

In an investigative report, the New York Times released a story on the strong bias of so-called “Independent Medical Exam” (IME) doctors for insurers. The report confirms what plaintiff’s lawyers have been arguing for years: these defense medical exams, more appropriately called DME’s, are nothing but additional tools for claim denial by insurance companies.

Any time a plaintiff makes a claim for personal injuries, insurers request to have the client examined by a physician of their choosing. Prior to litigation, insurers cannot require an exam, but once a lawsuit is filed, the rules allow them to insist on having an examination. It is in extremely rare circumstances that a defense medical exam confirms an injury. On most occasions, these reports tell the insurers just what they want to hear, and the insurers in turn, deny the claims.

One doctor even admitted in the NY Times report that he cannot be truthful about injuries. “If you did a truly pure report,” he said, “you’d be out on your ears and the insurers wouldn’t pay for it. You have to give them what they want, or you’re in Florida. That’s the game, baby.”

The Times reviewed case files and medical records and interviewed participants for its reports. The findings showed that the exam reports are routinely tilted to benefit insurers by minimizing or dismissing injuries.

Like New York, several Massachusetts companies have made a big business out of defense medical exams. These companies provide lists of doctors to insurance companies, provide office space for examinations, and provide templates for doctors to fill in for the reports. In some cases, we attempt to protect the client by sending a lawyer or nurse to accompany the client to the exam. In others, we seek an audio or visual recording of the exam. Insurance companies, defense lawyers, and doctors routinely oppose these efforts at leveling the playing field.

It was refreshing to read the New York Times report which confirmed many of the problems with these tilted examinations. Hopefully, this report will lead to greater juror skepticism or greater regulation of the medical exam industry.

To see the full New York Times report, click here.