Archive for RD Legal Funding

Cyber Security, FACTA, & Litigation Funding

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Cyber Security and identity theft are arguably the biggest issues in the world today. Someone’s entire life can be destroyed if their identity is stolen. A person who has their identity stolen can suffer immediate and future ramifications if the matter isn’t handled in a timely manner. It is why we have antivirus software to protect our devices and also why we only shop on websites where the sensitive information we input is secure. As information moved into the digital world, this new kind of security became a necessity. New industries have been created to try to prevent identity theft and catch the individuals engaged in that type of criminal activity. As the internet became a bigger part of how the world works, best practices have been established for consumers and businesses engaged in commerce online.

Some of these steps for consumers include browsing and shopping on safe and secure websites. For businesses, it is protecting their customers’ information when transactions take place. However, recent news stories reported the women’s clothing company Donna Karan fighting its customers over alleged violations of the Fair and Accurate Credit Transactions Act. (FACTA) FACTA is an act that contains provisions to assist in the reduction of identity theft. The act enables consumers to take preventative measures to guard their identity. Recently, Law 360 reported Donna Karan is appealing to the Supreme Court about a lawsuit filed by their customers over their alleged lack of diligence allowing full credit card numbers to be displayed on receipts. That mistake can cause severe damage to someone in the wrong hands. The other issue in this matter regarding FACTA could be the culpability of the business and what it may mean for them in terms of lawsuits.

“Consumers have the ability to file litigation against companies that are irresponsible with their personal information” says Roni Dersovitz, Founder of RD Legal Funding. “Litigation Funding allows plaintiffs to pursue lawsuits against well-capitalized defendants that have the ability to overwhelm them in a court of law.”

Huge retailers are currently or have been in litigation for this very issue. Target, Walmart, and others have been sued for reckless endangering their customers’ personal financial information. As the world continues to become digitized, companies may be more susceptible to the possibility of lawsuits from their customers should they not properly protect their sensitive financial information.

The Ohio Innocence Project Receives $15 Million

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The much heralded work done by those in the Ohio Innocence Project received a huge donation in the form of $15 million. The benefactor making this huge donation is Richard “Dick” Rosenthal. Rosenthal and his wife were longtime philanthropists who supported the mission of the organization which is to free every innocent person in Ohio. The Ohio Innocence Project is housed in the University of Cincinnati College of Law at the Lois and Richard Rosenthal Institute for Justice. The Innocence Project has helped free innocent people throughout the country from prison who were falsely accused of crimes by the justice system. They have helped prove the innocence and secure the release of people on death row, rape, and a whole set of other crimes. According to the news reports, it is the biggest donation an innocence project has received to date. Representatives from the organization have said the money will go a long way towards helping them in their mission. According to the University of Cincinnati College of Law, the organization has secured the release of 24 people from prison for crimes they have not committed. It is the only law school based innocence project. While Richard’s wife Lois died, it seems Richard is pushing to uphold the mission of the organization.

Four Car Companies Reach Settlement on Takata Air Bags

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After Japanese automaker Takata pleaded guilty for concealing deadly air bags that killed over ten people, four major car companies have also agreed to pay over $500 million to resolve claims related to exploding air bags in their vehicles. Toyota, Subaru, BMW, and Mazda will contribute the money to help fix the vehicles of people affected in the settlement. If the settlement is finalized later this year, the plaintiffs are going to receive $500 in compensation, a loaner car while the exploding air bags are removed from their cars, and related expenses will be covered under the settlement program. That comes on top of the reported $1 billion Takata has agreed to pay which will compensate automakers, victims and their families, and pay a criminal fine.

According to various news reports, the Takata air bags would explode with too much force sending lethal shrapnel to the drivers and passengers of the vehicle. Once the issue was discovered, there was a massive recall of the air bags which affected an estimated 42 million vehicles. The National Highway Traffic Safety Administration (NHTSA) published a list of cars that were effected by the Takata air bag scandal. Earlier this month, Senator Bill Nelson from Florida cited a report stating two-thirds of the vehicles with the defective airbags have not been fixed yet. He attributed the delay on fixing the effected vehicles on the lack of staff at the NHTSA due to President Donald Trump’s inability to fill positions at the agency. According to the Senator with summer arriving in a few weeks, it is imperative that the airbag issue gets resolved because more people drive in the summer months.

RD Legal Funding Joins Other Companies Challenging CFPB’s Authority, Seeks To Dismiss Lawsuit

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RD Legal Funding, LLC (RD Legal) and its affiliated companies recently filed a motion to dismiss the joint lawsuit by the Consumer Financial Protection Bureau (CFPB) and the New York State Attorney General’s office (NYAG). The motion seeks the dismissal of the complaint based on, among other things, the unconstitutional structure of the CFPB; the overreach by the CFPB in its attempt to regulate transactions over which it has no jurisdiction; and the improper characterization of RD Legal’s transactions as loans rather than true sales transactions.

During the course of the last several months, multiple media outlets have reported how other companies are pushing back against the CFPB’s overreaching as well as challenging the agency’s unconstitutional structure. In addition to RD Legal, Ocwen Financial Corporation, PHH Corporation, Pathfinder Payment Solutions, Prime Market Holdings, the Accrediting Council for Independent Colleges for Schools, and the State National Bank of Big Spring have challenged the CFPB’s overreaching. These companies have also argued the agency over stepped their authority, disregarded the law, and distorted the facts.  The U.S. Department of Justice has also argued that the CFPB’s structure is unconstitutional.

Additional Reading

http://www.breitbart.com/big-government/2017/04/04/companies-challenging-increasingly-vulnerable-consumer-financial-protection-bureau/

https://www.insidehighered.com/quicktakes/2015/10/26/gop-lawmakers-slam-cfpb-probe-involving-accreditation

http://www.bizjournals.com/southflorida/news/2017/04/26/ocwen-responds-to-illegal-foreclosure-lawsuit-by.html

https://www.law360.com/articles/877799/payment-processing-marketer-wants-sanctions-against-cfpb

http://www.nationallawjournal.com/id=1202774917908/ForProfit-College-Accreditor-Challenges-Politicized-Scrutiny

United States Insurance Companies Seeking Justice Against Saudia Arabia & Bin Laden Family Companies

Some insurance companies in the United States are pursuing lawsuits against entities in Saudia Arabia and Bin Laden family controlled companies due to the attacks in the United States that took place on September 11th. The Justice Against Terrorism Act (JASTA) passed in 2016, allowed for this kind of litigation to take place. The insurance companies are seeking over $4 billion in damages and compensation from the defendants. The plaintiffs, who are insurance companies, paid policyholders who suffered personal, business, and property injuries due to the attacks. The direct attacks took place in New York, Pennsylvania, and Washington DC. Of course, there were lingering effects people dealt with that insurance companies ended having to cover.

JASTA was a highly contentious piece of legislation that was debated among the legislators, lobbyists, and advocates on both sides. Some critics of the bill argued that national security was at risk should it pass. They said it would leave U.S. military forces open to litigation from foreign citizens and foreign entities. Supporters of the bill argued that the scope was narrow enough in that they were targeting companies and entities that had something or allowed certain transactions which led to the September 11th attacks. The legislation passed and President Obama vetoed it. Congress then overturned it. The bill became law. While there are plans for the families of the victims to pursue litigation, this lawsuit by the insurance companies is the first since JASTA passed. Osama Bin Laden and his Al Qaeda network were behind the September 11th attacks and many of the effected entities are trying to hold his family responsible. They accuse them of facilitating and helping Osama while he was plotting against the United States. So that is why they are going after the Bin Laden family companies.

Former Employees of Montana University To Receive Compensation Over Medical Insurance Claims

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Former employees who worked for Montana University are set to receive compensation due to a settlement the class of plaintiffs reached with the university. The plaintiffs alleged they were denied medical insurance claims due to a clause the university had in its contract that conflicted with Montana state law. Montana University operated their own health insurance program. Montana has a “made whole” statute that says the person injured has taken care of before the insurance companies hammer out which one is responsible for paying for the treatment. Montana University’s clause stated they were not responsible for paying if another insurance policy was available. As a result, many of the employees who found themselves paying out of pocket for treatment that should have been paid by the university. A group of former employees got together and filed a lawsuit against the university. A settlement was reached where the university will begin compensating the plaintiffs. The university also removed the clause prohibiting spending on their employees. Some news reports state compensation can run from a couple of hundred to $120,000 to some plaintiffs. In December, a hearing has been scheduled to follow up on the compensation proceedings. An estimated 45,000 people may be eligible for compensation.

Inflation, Annuities, Settled Case Fees, Settled Case Awards & Taxes

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Inflation 

The issue of inflation is very important to a settled case award or settled case fee because the purchasing power of either is part of the evaluation of the overall settlement. If there happens to be a settlement that takes place in 2017 and the settled case fee or award is deemed to be $1 million, but it won’t be paid until 2027 that can be a real problem. The uncertainty of the economy in 10 years could have drastic results for the recipients. That 10 year gap between being awarded and actually receiving the fee leaves it susceptible to rising interest rates. Rising interest rates decrease the purchasing power of that $1 million which could lead to a plaintiff or their attorney to determine the settlement as not acceptable. If interest rates rise a percentage or two, that will reduce the amount of money expected.

Settled Case Awards With Annuity Type Payments (Structured Settlements)

Situations where a settlement occurs and the plaintiffs decide to to defer receiving the entire award at once and receive periodic payments over time periodic payments that is a structured settlement. Some of the reasons why a plaintiff would decide to use this option include tax liability, financial stability, and time value of money. A plaintiff may leave themselves exposed to a higher tax rate when they take their award. The plaintiff may already be financially stable and may not need the money until a specific time in the future.

Structured Attorney Fees 

When an attorney gets their fee after a settlement, successful verdict or judgment they have the option to choose to take their fee upfront, where they will be taxed at a higher rate by the government. There are options plaintiffs’ attorneys have where they can structure the fee and invest their fee into different products where they can earn more on their potential investment. Companies like MetLife, Millennium Settlement Consulting, and Pacific Life offer plaintiffs’ attorneys the ability to structure their fees. Some of the benefits for structuring their fees include reducing tax exposure, setting up retirement income, structured income over a period of time instead of a lump sum.

Taxes 

Once a plaintiff receives their settlement after attorney fees have been taken out, the medical costs have been paid, there is only one entity left to get their pay and that is the United States government through the Internal Revenue Service. (IRS) According to the IRS’website a plaintiff does not have to pay taxes if they have not deducted medical expenses in the prior years if the proceeds are from a personal injury lawsuit. In an employment law settlement, the proceeds connected to lost wages are subject to regular wage taxes, social security, and medicare rates in that year. Punitive damages from a settlement are treated as Other Income.

Advice: One should consult with a tax adviser after receiving settlement proceeds to get the best advice.

Former Students Settle With Trump University for $25 Million

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According to various news reports, a federal judge gave final approval to a $25 million settlement agreement former students reached with Trump University. The students, who attended the school to receive specialized education in real estate, accused the university of fraud. Some students allegedly paid between $1,000 to $35,000 to attend classes. They were promised the opportunity to learn the secrets of getting rich in real estate. In addition, the ability to access private financing options. The students said both turned out not to be true. They say they were deceived by the promises of Trump University and were pressured by officials at the school to buy and elevate their package causing them to pay more money.

During the 2016 presidential election, then candidate Donald Trump vowed to keep fighting the lawsuit even insulting the plaintiffs. Days after the election, the trial was set to commence. Instead a settlement between the plaintiffs and the university had been announced. Preliminary approval was given in December and final approval was rendered by a federal judge of the settlement. Trump University and Donald Trump did not admit guilt. The specifics of the settlement include $21 million for the estimated plaintiffs to split among themselves. Most observers expect the plaintiffs will receive at least half of what they spent if they aren’t made whole. $4 million will go to the settle the New York State lawsuits against the university. The plaintiff attorneys’ who litigated the case graciously decided not to take their fees and absorb the costs of pursuing the case.

From Hallucinations to Heart Problems: The Effects of Concerta and Its Generic Equivalents

259502894_f3e435ebd8_zOn October 18, 2016, the United States Food and Drug Administration (FDA) proposed withdrawing two generic versions of Concerta. The FDA ran tests on both drugs and it was determined they had insufficient effects on patients. The drug, Concerta, is alleged to have a number of side effects on people who take it including suicide, agitation, convulsions, disturbed sleep, hallucinations, hostility, stroke, anxiety, depression, drug addiction/abuse, heart issues, mania, and psychosis. The two drug manufacturers are Kremers Urban (subsidiary of the Lannett Company), and Mallinckrodt Pharmaceuticals, which were both given opportunities to request a hearing by the FDA to show why their drugs shouldn’t be withdrawn. Ordinarily, a move like this from the FDA would lead to a flurry of lawsuits.

Patients cannot sue the manufacturers relating to efficacy or labeling of the drug. Also, because they are generic manufacturers, the companies cannot change the formula or labels on their own even if new information about safety and side effects are discovered. The United States Supreme Court upheld this idea in a 5 to 4 decision that overturned a New Hampshire jury verdict; the verdict awarded over $20 million to a woman who took a generic version of a drug. Generic drugs exist to help consumers save money on buying drugs they need to treat illnesses. According to the Congressional Budget Office, generic drugs help consumers save an estimated $8 to $10 billion at retail pharmacies. Institutions like hospitals and clinics save billions when they use generic drugs.

According to the FDA, a generic drug is developed under patent protection when it is first created. This gives the company the sole right to sell the drug while the patent is in effect, essentially giving it a monopoly on the market. Once the patent wears off, generics can enter the market submitting their new drug application for approval. The Orange Book provides a way to look up generic versions of brand name drugs. Concerta is manufactured by Janssen (subsidiary of Johnson & Johnson). It is used to treat Attention Deficit Hyperactive Disorder (ADHD).

 

Photo credit: Michael Chen, photo

Link Between Ovarian Cancer and Talc-Based Cosmetic Products

26770539316_653521db53_zWithin the past couple of years, lawsuits have been filed against companies like Johnson & Johnson in regards to products containing talcum powder. Research has shown that talcum powder is an unsafe sterilizing agent that can lead to ovarian cancer in women who use products like Johnson & Johnson’s Baby Powder around their genital area. While Johnson & Johnson’s talc-based powder is labeled as Baby Powder, they market their product for women’s use too.

Studies have been conducted since the 1980s on the negative side effects of talcum powder use in the female genital area, but Johnson & Johnson never informed their consumers about the risk of using their products containing the powder because the results were inconclusive; there was no grounding evidence to support the link between ovarian cancer and talcum powder (though past and recent claims would suggest otherwise).

What exactly is talcum powder?

According to The American Cancer society, talc powder is essentially a mineral comprised of magnesium, silicon, and oxygen. It can be used as a sterilizing agent, and is the first named ingredient in Johnson & Johnson’s Baby Powder.

Where is the link between ovarian cancer and talcum powder?

Women who use talc-based products like Johnson & Johnson’s Baby Powder for feminine hygiene are at risk of forming ovarian cancer due to talc particles getting trapped in their ovarian tissues. Trapped talc particles would eventually cause inflammation in the ovaries and lead to the development of cancerous ovarian cell growth.

A woman from Texas filed a complaint in mid-August alleging that the consistent use of Johnson & Johnson’s Baby Powder caused the death of her daughter, Janel Kuntz. She was diagnosed with ovarian cancer at 43 years old, and was apparently using Johnson & Johnson’s Baby Powder product for at least 23 years. She was unaware of the health complications talc powder has on females who use it to keep their lady parts “fresh” as the powder absorbs moisture and eliminates odor.

But Janel Kuntz was not the first woman to be diagnosed with ovarian cancer due to using Johnson & Johnson’s Baby Powder. The first talcum powder lawsuit filed against Johnson & Johnson was in 2009 by a woman named Diane Berg. And in 2013, Jackie Fox filed a talcum powder lawsuit against Johnson & Johnson. Unfortunately Ms. Fox passed away in 2015 due to ovarian cancer, but the pharmaceutical company was found liable and paid out $72 million to Ms. Fox’s son after her death.

Berg, Kuntz, and Fox are only a few among many women who have filed lawsuits against Johnson & Johnson for their unsafe talc-based powder products. The growing number of talcum powder lawsuits being filed against Johnson & Johnson has sparked “a group of plaintiffs” to file a motion with the U.S. Judicial Panel on Multidistrict Litigation (JPML) to consolidate all claims as part of a multi-district ligtigation (MDL).

Photo credit: Mike Mozart, photo