Monthly Archives: October 2011

Hot Coffee: A New Documentary Exposes the Lie of Tort Reform

Today’s guest post comes to us from our colleague Len Jernigan of North Carolina.

Have you heard the story about the woman who ordered some hot coffee from McDonald’s, spilled it on her lap, burned herself, and sued McDonald’s for millions of dollars? Ridiculous, right? It’s the poster story for so-called “frivolous law suits.”

McDonald’s had already received and ignored over 700 reports that their coffee had burned customers.

Well, would you still think the story was ridiculous if you knew these facts?

  • Stella Liebeck, 79 years old at the time, wasn’t driving when the coffee spilled – she was sitting in the passenger seat of a parked car.
  • She suffered 3rd degree burns from the coffee and required 2 years of painful surgeries and skin grafts.
  • Properly brewed coffee NEVER reaches a temperature where it is capable of causing burns like the ones Ms. Liebeck suffered. McDonalds kept their coffee at 185 degrees, which causes severe burns in 3-7 seconds. Home brewed coffee never gets above 150 degrees, which would not cause these kinds of burns.
  • Even before Ms. Liebeck was injured, McDonald’s had already received and ignored over 700 reports that their coffee had burned customers.
  • Ms. Liebeck’s initial request was that McDonald’s pay $20K, the amount of her medical treatment that Medicare would not cover. McDonald’s offered her just $800.
  • After a trial, a jury of 12 ordinary people decided that McDonald’s blatant of disregard for hundreds of complaints about their coffee warranted an award (and penalty) of 2 days’ worth of coffee sales, which in 1994 was $2.7 million.
  • The jury’s award was appealed by McDonald’s and reduced, and then further reduced to less than $600,000 after McDonald’s mounted a multi-year legal battle against Ms. Liebeck.
  • As part of Ms. Liebeck’s settlement with McDonald’s, she was forced to sign a gag order, which prevented her from speaking about the case or the settlement. McDonald’s told its version of story to the press, while she was legally unable to defend herself or tell her side.

Hot Coffee, Susan Saladoff’s gripping and moving new documentary tells the story of Stella Liebeck and other regular Americans like her who have used the U.S. judicial system to fight for justice. It also tells the story of how corporate interests are, bit by bit, taking our right to trial by jury away. (video after the break)

Continue reading

Cost Shifting: The Dirty (not so little) Secret of Worker’s Comp

Seasoned worker’s compensation practitioners know some employers and worker’s comp carriers consciously employ questionable tactics to limit their exposure. They mischaracterize high risk employee job titles as low risk to reduce premiums; they call long-term employees “Independent Contractors” to get them off worker’s compensation roles; they hire doctors to render boilerplate predictable opinions to deny claims; and they discourage genuine worker’s comp claims by telling employees to submit work-related medical bills to group insurers, Medicare or Medicaid.

They discourage genuine worker’s comp claims by telling employees to submit work-related medical bills to group insurers, Medicare or Medicaid.

This last piece of fraud is the most nefarious, especially since medical costs now exceed indemnity payments in Wisconsin and most other states. The cost shifting means we all pay (as increased group health premiums and taxes) for medical expenses that should be paid by worker’s comp carriers. In states such as Wisconsin where work injury related treatment expenses are paid at doctors’ usual and customary rates, shifting the cost to a group carrier, Medicare or Medicaid saves worker’s comp carriers millions.

The cost shifting means we all pay (as increased group health premiums and taxes) for medical expenses that should be paid by worker’s comp carriers.

Denial of a claim by using “legitimate doubt” or purchasing the opinion of an adverse medical examiner results in medical treatment provided at reduced negotiated rates through non-worker’s comp coverage (Union health care, Medicare, Medicaid, etc.). Continue reading

Dangerous Beauty Honor Roll: Want to know who else thinks Brazilian Blowout should be illegal?

Over the last few weeks, we’ve been sharing information on the dangers of formaldehyde-laced hair straightening products, including the infamous Brazilian Blowout, among others. The FDA recently issued a warning to the makers of Brazilian Blowout, and increasingly salon professionals are demanding that it be recalled.

Recently the National Healthy Nail and Beauty Alliance demanded that the FDA immediately recall Brazilian Blowout and similar products. According to the FDA, the cosmetics industry’s own safety review board issued an opinion critiquing the safety of straighteners that use formaldehyde. OSHA has issued a national hazard alert. And this year the National Academy of Sciences (NAS) released a report on formaldehyde that confirmed the EPA’s determination that it causes cancer.

The FDA does not have the ability to ban a beauty product. It can only issue a “voluntary recall,” meaning that it cannot mandate the removal of dangerous products from the market.

Many other countries, however, have made hair-straighteners with formaldehyde illegal, including Australia, Canada, Ireland, France and Germany.

So, who thinks we should stop using these formaldehyde-based hair straightening treatments? Well, obviously a whole lot of people.

So why do people keep using it? Continue reading

Worker’s Comp and Wellness Programs: A Good “Fit”?

Making time for wellness may actually make you more productive. This brings up new issues for workers' comp.

A new study says reducing work hours for exercise or other health activities does not diminish productivity but actually could increase work productivity. The study is published in the August 2011 Journal of Occupational and Environmental Medicine.

A group of employees in a large Swedish health organization was assigned to a mandatory exercise program carried out during regular work hours for two and a half hours per week. Another group received the same reduced work hours but no exercise program. Employees assigned to the exercise program had significant increases in productivity; they felt more productive while on the job and had a reduced rate of work absences due to illness.

In Wisconsin, injuries incurred during on-premise recreation during paid breaks, and encouraged by the employer have been found compensable. 

Such programs raise interesting issues for workers and worker’s compensation claims when engaged in these activities. In Wisconsin, injuries incurred during on-premise recreation during paid breaks, and encouraged by the employer have been found compensable. In contrast, any program event or activity designed to improve the physical well being of the employee, if voluntary and not compensated, is not compensable. Continue reading

Dangerous Beauty Part 3: List of Shame: More manufacturers who lie about formaldehyde

Over the last couple of weeks, we’ve been sharing some information about the dangers of the Brazilian Blowout styling product and the formaldehyde that makes it noxious. But Brazilian Blowout isn’t the only styling product with formaldehyde in it. Today let’s take a look at some others.

The U.S. Occupational Safety and Health Administration (OSHA) has cited four other manufacturers of hair straightening products for health violations, including failure to tell their employees and customers (stylists and consumers) about the dangerous chemicals in their products. These companies have been lying to their employees and customers:

M&M International Inc., makes Marcia Teixeira hair straightener
_ Fined by OSHA on multiple occasions for, among other things, failing to ensure that their safety data accurately reflects the formaldehyde content in their product.

Copomon Enterprises, makes Keratin Complex Smoothing Therapy
_ Fined by OSHA for, among other things, failing to ensure that their safety data accurately reflects the the formaldehyde content in their product. Continue reading

Should your doctor have access to surveillance videos of you?

If you file a workers' compensation claim, your doctor may have access to surveillance footage of you.

A dozen attorneys in Montana representing injured workers made headlines petitioning their Supreme Court to stop State fraud investigators sharing surveillance videos with doctors of worker’s compensation claimants. About 14,000 Montana residents are covered by the State Fund and the Fund’s Investigative Unit conducts video surveillance on about 500 claimants each year and shows the videos to claimants’ treating physicians. This practice raises questions about physician-patient privilege and patient privacy.

In Wisconsin and most other States, the physician-patient privilege is waived by an employee who reports a work-related injury. The waiver only extends, however, to any condition or complaint reasonably related to the work injury. Considerable debate sometimes arises over which treatment records are reasonably related to a claim. A broken toe, for example, is not likely relevant to an asthma condition but a prior Hepatitis-C claim may be. Employers and insurers may attempt to obtain records from a medical provider without a release, and practitioners must provide reports to the employer, insurer, employee, or Worker’s Comp Division within a reasonable time after written request.

The Fund’s Investigative Unit conducts video surveillance on about 500 claimants each year and shows the videos to claimants’ treating physicians… In Wisconsin and most other States, the physician-patient privilege is waived by an employee who reports a work-related injury. The waiver only extends, however, to any condition or complaint reasonably related to the work injury. 

Insurance carriers and employers also defend or deny worker’s compensation claims through surreptitiously obtained videos. The videos Continue reading

Dangerous Beauty Part 2: Why you don’t want to be anywhere near the formaldehyde in a Brazilian Blowout

The formaldehyde in Brazilian Blowout products is dangerous for both stylists and their clients.

This is the second installment in our series on the dangers of hair-straightening products with formaldehyde.

For many of us, the word formaldehyde conjures up images of high school biology class, and glass jars full of preserved frogs. But for Molly Scrutton, a stylist from Portland, Oregan, it most likely calls to mind the sore throat and aching chest she felt after giving her clients the Brazilian Blowout hair treatment.

After investigating and learning that other stylists had suffered from similar symptoms, Scrutton reported it to local health officials. Since then, Brazilian Blowout has been found to contain over 10 times the amount of formaldehyde considered safe.

Turns out formaldehyde is pretty nasty stuff. Here’s why:

Formaldehyde does terrible things to the body.

Formaldehyde can irritate the eyes and nose, causing coughing and wheezing. It can cause allergic reactions of the skin, eyes and lungs, such as asthma-like breathing problems, skin rashes, and itching. Effects reported by users of formaldehyde-laced hair straightening products include eye disorders, nervous system disorders, respiratory tract problems, chest pain, vomiting and rash. If you have been exposed to a hair straightener and suffer from any of these symptoms, you should seek medical treatment immediately.

Sometimes the effects of formaldehyde exposure are irreversible or fatal.

When formaldehyde is sprayed into the eyes, it can cause blindness. It is also a known carcinogen, and has Continue reading

Workers Should Challenge Compensation Denials

Even if your claim is denied, it may be an error and you may still be eligible for workers' compensation.

Workers’ Compensation claims are down in volume nationally. My colleagues who represent injured workers indicate their inventories are diminished; my colleague adversaries representing insurance carriers and employers indicate their claims and case files are substantially down as well. In Wisconsin the industry is experiencing a decline in premium volume representing an absence of payroll. The only slight uptake is in the manufacturing sector, not representing new hires but merely increased overtime. Lower case volumes have produced a “race to the bottom” in hourly rates charged by firms to defend the claims, and all parties involved in the worker’s compensation arena, doctors, vocational experts, private investigators, surveillance companies, and insurance adjusters are experiencing a decline.

Some of the decline is attributable to the unfortunate phenomena of workers with meritorious claims not challenging the denial of the claim by “independent” medical examinations.

One unfortunate consequence of the troubled economy and decline in job opportunities is that workers are not challenging questionable denials of their worker’s compensation claims. Fear of termination, employer retribution, or other job opportunities is likely prompting workers to simply accept compensation denials by the worker’s Continue reading