Tom Stebbins, Executive Director of the Lawsuit Reform Alliance of New York, talked to Capitol Pressroom host Susan Arbetter about asbestos litigation reform and bills to regulate lawsuit lending in the last week of the 2018 legislative session. The full interview can be accessed here.
***FOR IMMEDIATE RELEASE***
June 13, 2018
Lawsuit Reform Alliance Calls for Court to Dismiss Climate Lawsuit
“Profit-seeking trial lawyers should not be making public policy in the courts.”
ALBANY— Lawsuit Reform Alliance of New York executive director Tom Stebbins called on Southern District of New York Judge Keenan to dismiss the climate lawsuit filed by New York City against energy companies ahead of oral arguments in Manhattan federal court on the matter today:
“Our state is already a haven for excessive litigation and this kind of lawsuit only adds to the problem. Trial lawyers are weaponizing the legal system and stretching tort law far beyond its purposes in search of the golden goose.
“The same plaintiffs’ firm involved in the New York City lawsuit – Seattle-based Hagens Berman – is involved in the lawsuits filed by San Francisco, Oakland, and King County in Washington State. This plaintiffs’ firm stands to profit substantially if any of these absurd cases are settled. And while out of state trial attorneys enrich themselves on massive contingency fee arrangements, New York’s energy consumers will pay the bill.
“Profit-seeking trial lawyers should not be making public policy in the courts. That is not the role of our judiciary, but the domain of Congress and state legislatures. These frivolous lawsuits clog our already-burdened legal system and will do nothing to actually solve the problem. As such, we strongly support dismissal of the New York City lawsuit.”
LAWSUIT REFORM ALLIANCE CALLS ON LEGISLATURE TO PASS BILL TO REGULATE LAWSUIT LENDING
Lawmakers Must Close The “Predatory Lending Loophole” In The Final Days of Session
ALBANY – As the legislative session winds to a close, Lawsuit Reform Alliance of New York executive director Tom Stebbins today called on the state legislature to pass a bill that would subject companies that offer settlement-advance loans to plaintiffs in personal injury lawsuits to the same consumer protection laws as all other providers of consumer loans.
Following a public hearing convened in May by Senate Consumer Protection Chair Chris Jacobs (R-Buffalo) and Senator Rob Ortt (R-Lockport) Stebbins reiterated LRANY’s support for S3911B, a bill introduced by Senator Ortt and Assemblyman Magnarelli that would cap interest on lawsuit loans at New York’s existing threshold for criminal usury.
Since the hearing, which was called after the New York Times and the New York Post reported on predatory practices within the industry, the Senate has seen the introduction of a bill supported by the New York State Trial Lawyers Association and a bill supported by a trade group representing the lenders.
“The hearing provided an opportunity for a number of voices to be heard on how to best protect consumers from the excesses of the lawsuit lending industry. As the New York Post and the New York Times have both reported recently and in the past, there are countless stories of abuse and profiteering in this currently unregulated sector.
“It is time to put politics aside, ignore the indsutry’s attempt to muddy the waters, and pass common sense legislation that will protect consumers from predatory lending practices. Lawmakers must close the loophole that allows these companies to take advantage of some of the most vulnerable, desperate New Yorkers.
“Senator Ortt’s and Assemblyman Magnarelli’s bill is the way to do that,” Stebbins said.
Similar legislation passed the Senate unanimously in 2016, but the lenders and their representative trade groups have since dramatically increased their spending on lobbying against any regulation in New York.
Law week’s Scaffold Law Reform Lobby Day was profiled in Habitat Magazine with Jason Schiciano, the president of a Westchester-based insurance brokerage telling the publication that he joined advocates at the capitol because he is determined to persuade the legislature to fix the law. “I feel like each time I’ve gone up, more of the legislators are aware of the situation and they have a better understanding of the issues,” he said. LRANY executive director Tom Stebbins was also interviewed by the publication noting that the reform we are looking for is to apply liability just as it is applied for all other types of injuries.
Senator Rob Ortt and LRANY’s Tom Stebbins joined Liz Benjamin on Capital Tonight last week following a public hearing regarding regulating the lawsuit lending industry:
There’s a lucrative industry in New York known as lawsuit lending, and state lawmakers want to crack down on it.
Lenders provide up-front cash to plaintiffs in lawsuits who promise to repay the money after winning a settlement or award in their case.
However, these lenders are charging sky-high interest rates, making it impossible to repay the loan.
The New York Post published an op-ed from LRANY’s Adam Morey ahead of a hearing held on Wednesday May 16th by the New York State Senate Standing Committee on the issue of lawsuit lending:
Lawsuit funders sniff out tragedy to cash in on misfortune. They spend heavily on advertising that targets the disadvantaged and desperate.
Companies offer money up front for pending lawsuits and claims. Funders promise “cash now,” with some offering no-credit-check approval in just one day.
But the truth is the industry is rife with unscrupulous actors looking to exploit the legal system.
Buried in the contracts, consumers find that interest is often compounded monthly, with annual rates that exceed 100 percent. People who sign these lending agreements may ultimately win their lawsuit only to take home a tiny fraction of their award — a majority of the money ends up in the pocket of the lender, and all of this comes as the victim’s attorney also gets to take a third of the winnings.
Lenders claim that because repayment is contingent on the borrower winning the case, the product they offer is especially risky and shouldn’t be classified as a loan. This allows them to charge outrageous interest rates, well beyond those allowed under New York’s consumer-protection law.
But just how risky is it? A study published last year by Vanderbilt Law found that 84 percent of claims filed in New York’s state courts are settled. Another report revealed that lenders are choosy about their targets, with one funder furnishing just 10 percent of the loan requests it received. And as the Times revealed in devastating detail, lenders and lawyers often work together to negotiate the payout.
The result is a business model that takes advantage of consumers and turns the civil-justice system into a profit center.
Read Adam’s full op-ed here.
In court documents filed last week in U.S. District Court in Albany, Abraham Jacob Warner said he bought StarKist tuna products as recently as February because of an American Heart Association logo displayed on the cans. The Walker Valley resident said he thought the heart check mark indicated the products were a healthier choice than cans without the logo.
Warner is asking the judge to award $50 to each class member or their actual damages, depending on which is greater, “an increase in the award of damages to an amount not to exceed three times the actual damages up to one thousand dollars,” and lawyer fees and costs.
Tom Stebbins, executive director of the Lawsuit Reform Alliance of New York, said the complaint highlights the need for change in how the state handles these types of lawsuits.
“Would a reasonable consumer feel they were injured because the company paid administrative fees for use of the American Heart Association Check-Mark logo? And for that matter, would a whole class of consumers feel that way? Something fishy is going on here,” he said in an emailed statement.
The New York Post published a letter from LRANY’s Adam Morey on Sunday, April 8, 2018:
The Post is correct that your daily coffee is still safe to consume, despite a judge’s ruling that coffee shops in California must display cancer warnings (“Don’t Fear the Java,” Editorial, April 3).
But this is more than a dubious decision from a crazy California courtroom: It represents a victory for the profiteering lawyers who brought the lawsuit.
Scientists disagree whether the chemical in question is a carcinogen, but a California-only law encourages lawyers to sue despite scientific uncertainty.
Such a law should worry New Yorkers. Gov. Cuomo has said the plaintiffs’ bar is “the most powerful political force in Albany.”
Perhaps it is time for legislators to rebuke the lawyers lobby, lest New York end up like California, where trial lawyers and warning-label crusaders have confined the state to its own alternate universe.
Adam Morey, Public Affairs Manager, Lawsuit Reform Alliance of New York, Albany
The Journal News/LoHud.com covered a report released last week by the Lawsuit Reform Alliance of New York that details the increase in abusive lawsuits filed under the Americans with Disabilities Act:
New York has seen a spike in “meritless and dubious” federal lawsuits filed under the Americans with Disabilities Act, a report filed by a legal reform group claims.
Titled “Serial Plaintiffs,” the 11-page report by the Lawsuit Reform Alliance of New York maintains that, while well-meaning, the law can be exploited by attorneys seeking hefty settlements, in some cases using “boilerplate” lawsuits.
More recently, there has been a spike in lawsuits accusing company websites as being in violation of ADA, a symptom of unclear language in the law that requires updating, according to the report.
The full story can be found here.
FOR IMMEDIATE RELEASE: (Albany, NY) – Today, the Lawsuit Reform Alliance of New York (LRANY), a non-partisan nonprofit advocacy group focused on state-level lawsuit reform, released a report entitled: “The Doctor is in…Another State: How NYPIRG’s Physician Supply Report Misses the Mark.” The report highlights serious flaws in the New York Public Interest Group’s (NYPIRG) recent report “The Doctor Is In: New York State’s Increasing Number of Physicians,” which claimed that no physician shortage exists in New York, and that high medical malpractice rates do not affect physician supply.
The first glaring flaw, LRANY contends, is that the report presents only the current per capita number of physicians, and fails to account for long-term trends. LRANY analyzed physician supply data for 50 states between 2008 and 2012, and found that total physician supply increased in nearly all states. The national average per capita growth in total physician supply was 6.04 per 100,000, yet New York’s per capita supply grew by only 2.3 per 100,000, barely one third the national average. Thirty-seven states performed better than New York, including states that have enacted key tort reforms such as Texas, California, Wisconsin, and Florida.
Tom Stebbins, LRANY’s Executive Director, said “NYPIRG is clearly trying to manipulate the numbers to support their political agenda – which is closely aligned with the personal injury trial lawyer lobby.”
The LRANY report also highlights that NYPRIG’s claim that there is no physician shortage in New York is unsupported by the underlying data, which shows only that physician supply has increased in New York. NYPRIG’s claim that this demonstrates that no physician shortage exists is invalid because it does not also account for the total need for physicians, which has increased at a greater rate. LRANY points out that excluding New York City, the Healthcare Association of New York (HANYS) recently estimated New York’s total physician shortage to be over 1,000. Seventy-five percent of hospitals surveyed by HANYS reported that the recruitment of primary care physicians was very difficult due to shortages, while 87% indicated that their ability to recruit physicians was the same or worse than the previous year.
Lastly, the group notes that the NYPIRG report is critically flawed because it claims there is little evidence that our state’s high medical liability premiums are impacting the number of physicians that practice in New York. Said Stebbins, “Of course NYPIRG didn’t find a connection between high liability insurance rates and doctors leaving our state – they didn’t bother to ask the doctors.” Stebbins pointed to the case of Dr. Wendy Villalobos, an OB-GYN who formerly practiced in the Bronx. “Her premiums were $186,000 each year. When she moved to Texas, which enacted comprehensive lawsuit reform in 2003, her premiums fell to just 20% what they were in New York.” Stebbins also highlighted a recent survey by the American Medical Group Association which found that financial considerations top the list of reasons that physicians relocate.
“The bottom line,” said Stebbins, “is that high medical liability premiums driven by our out-of-control legal system are hindering New York’s ability to attract and retain qualified physicians.”
The full report can be accessed here.