What’s My Personal Injury Case Worth?

Personal injury value              Is my case worth
$1 million? $10 million?  We’ve all heard
the stories.  “My friend broke her
fingernail and got $150,000.”  “My
brother-in-law’s friend’s cousin’s son’s wife got $4 million when she fell at
the A & P and broke her wrist.”  “Bob
Hartman got $2.7 million because he was rear-ended by a drunk driver and the
drunk’s insurance company was afraid to go to court.” 

            How
are these crash-to-riches cases possible? 
Well, in a word, they’re not!  

Are there multi-million dollar verdicts and settlements?  Of course there are but they are based on major injuries, good liability and deep pockets.  

Click here for details about a motorcycle accident that my office settled for almost $8 Million

Urban Legends

Urban-legend-rumor             Let’s
face it, folks.  Insurance companies are
not in the business of handing out huge settlements – they’re in business to
make money and unreasonable payouts fly in the face of their business model.  Unreasonable (and unjustified) large payouts
are just not the reality, they are simply urban
legends
.

Snopes.com quells the
examples of alleged gazillion dollar recoveries from people filing outrageous
lawsuits by researching the real facts (or lack thereof).  The Stella Awards,
named for Stella Liebeck, the plaintiff in the famed McDonald’s Burn Case (read
the real story here
) was a leader in putting out annual lists of crazy
lawsuits with alleged crazy
settlements and jury verdicts – but these lawsuits are not real, they are more
examples of urban legends. 

Really, Now.  What’s My Case
Worth
?

         Reality
check everyone: Every case is different.  Your rear-end case has a different value than
your neighbor’s rear-end case.  Sonny’s slip
& fall case has a different value than Chastity’s slip & fall case.  Chester’s
product liability case is different than Field’s product liability case.

            Why?  Because every case has its own unique dynamic
based on many of these factors:

*     
People/entities involved

o      
Parties

o      
Medical providers

o      
Employers

o      
Eye-witnesses

o      
After-the-fact witnesses

o      
Expert witnesses

o      
Insurance company(ies)

*     
Facts of the accident

*     
Who’s at fault and to what extent?

*     
Injuries sustained

*     
Medical bills (past, present and future)

*     
Loss of earnings (past, present and future)

*     
Property damage

*     
Pain, suffering, inconvenience, embarrassment,
disfigurement

 

Case Study

 Scalding Water Burns Tourist in Restaurant 

            As you know,
personal injury cases come in all shapes and sizes. There are, to name a few, traffic collisions, injuries
when someone has a slip
& fall
, product
liability
cases and premises liability
cases.  I am using this premises
liability case to illustrate the points raised in this particular article. 

Note: This story has been fictionalized and all persons appearing
in this work are fictitious. Any resemblance to real people, living or dead,
places or events is entirely coincidental. 

Boiling water              Facts: Kiki, a
30-year old female Japanese tourist visiting relatives, went to a Chinese restaurant
in Los Angeles’s famed Chinatown for a family meal.    Chinese Restaurants serving large parties
often place a Lazy Susan
on the center of the table to make it easier to serve the meal family style.  

            Early
on, the restaurant placed a teapot filled with scalding water on the edge of
the Lazy Susan.  While Kiki, with her
four-year old daughter Ling on her lap, and 11 other family members sat around talking,
the condensation began to form on the outside of the teapot.  Engrossed in conversation, no one at the
table was paying attention to the Lazy Susan or the teapot until disaster
struck.

            Suddenly,
the teapot was on its side and the contents spilled out all over Ling and Kiki.
 Little Ling began screaming and Kiki rushed
to cover her in cold water all the time unaware that her own arm was drenched
in hot water.

            Kiki
was able to save Ling from serious injury.  Although Ling was burned, the burns were first-degree
and quickly healed, leaving no scars.

            Unfortunately,
Kiki, who was wearing a long-sleeved sweater at the time, was not so lucky.  While Kiki tended to her child, the scalding
water caused her polyester sweater to literally meld into the skin of her arm.  She removed the sweater and several layers of
her skin in the process. 

            Kiki,
suffered second degree
and third degree burns
as a result.  That night she went
into shock
and was rushed to the emergency room. 

            Kiki’s
healing process was long and arduous.  She
returned home and underwent a major skin graft
where they replaced the damaged and dead skin on her arm with skin from her
scalp (and to answer your question in advance, her arm did NOT grow hair).  She has been left with permanent, unsightly
scars on her forearm.

 Who's Fault Is It That Kiki Was Hurt?

             Well,
this case had some unique twists and turns.  In evaluating this case, several of the factors
listed above had to be considered.  The
first, of course, was who was at  fault
was this incident?

            On
first blush, it appears to be the restaurant’s fault.  However, it’s important to note that the plaintiff
(the person making the claim) has the burden
of proving
that it is, in fact, the restaurant’s fault.

            Since
everyone at the table was talking when the incident occurred, we had no
witnesses who could honestly say how or why the teapot tipped over.  It was through the use of an expert witness’s forensic
analysis
that we were able to develop the viable condensation theory.

            The
expert, a physicist, based his analysis on an examination of the location, the Lazy
Susan, the dispenser from which the hot water was poured into the teapot, the
teapot itself and the depositions of Kiki and Shuau, the restaurant employee
who placed the teapot on the Lazy Susan.  Shuau testified at her deposition, under penalty of perjury,
that she was instructed by the restaurant to wait until the temperature gauge
on the dispenser was pointing to red before filling the teapot with water.  

            “What
does it mean when the needle points to red,” I asked.

            “Dangerous.”

            “Dangerous?”

            “Yes,
dangerous.”

            The
restaurant’s attorney covered his face with his hands upon hearing this admission.   It is also important to note that an employer
is responsible for the acts undertaken by its employees while in the course and
scope of their employment
. 

            This
is not to say that the restaurant’s lawyers weren’t mounting a defense.  The severity and degree of the injuries were
definite and obviously caused by the hot water dispensed by an employee of the
restaurant.  

 Who's fault             So
what could they say to mitigate their responsibility?  Simple: Kiki should have removed her sweater
sooner and none of this would have happened!  Yes, this was their defense.  (Defense lawyers ALWAYS have a trick or two
up their sleeve – click
here to read Anderson Cooper’s relevant expose
).  

There were
other family members there – why didn’t they take care of Ling while Kiki took
care of herself?  Actually, I hoped that
the defense would bring this up at trial because what juror would buy that
argument?  If anything, it would inflame
them because any parent, any human being for that matter, is going to tend to a
child before they tend to themselves.  That’s
just human nature. 

What Is Kiki Entitled To? 

Dollar sign              There
are various types of damages that someone is entitled to.  In Kiki’s case she was entitled to special
damages and general damages.  She sued
the restaurant for Negligence for her injuries as well as Negligent Infliction
of Emotional Distress for having witnessed her daughter’s injuries.  Since this writing is devoted to damages, I’m
not going to go into any detail on the actual legal theories of liability.

            Special, or economic, damages
are those that are quantifiable such as past, present and future medical bills
and loss of earnings that arise from the injury.  In this case, Kiki had about $40,000 in
medical bills incurred for the emergency hospital visit and her skin graft.  It was agreed upon by everyone that these
bills were reasonable and certainly necessary.  Therefore, she was entitled to reimbursement
for $40,000.

            General, or non-economic,
damages
are subjective damages for pain, suffering, disfigurement,
embarrassment, emotional distress, humiliation, loss of pleasure in life.  Normally, I’d put the actual figure in here upon
which we settled.  However, I’m going to
leave this to you.  What do you think Kiki is
entitled to by way of general damages
?  
Please put your answer in the comments
section!          

“Wait!” You Say!  “Didn’t You
Forgot Something?

             Just
checking to see if you were paying attention!  No, of course I didn’t forget little Ling.  That would be clumsy of me (not to mention a
tad bit of legal
malpractice
).  Thankfully Ling
suffered no permanent injuries.  She was
scared and had some blisters which healed and left no scars.  Naturally (and necessarily), she was included
in the lawsuit. 

            Ling’s
special damages amounted to $800 for a visit to a local doctor and some healing
ointments.  Again, both sides agreed that
this was reasonable and necessary.

            Again,
I’m going to leave it to you to decide her general damages. 

 Injured? Questions? Concerns? 

For a Free Consultation please contact Attorney Lowell Steiger immediately at

(323) 852-1100

lowell@steigerlaw.com

Skype (with or without video): Lowell_Steiger

"Treated With the Respect and Understanding That You Deserve"

Motorcycle Accident Leads to Traumatic Brain Injury, $8M Settlement

Traumatic brain injury

Just when you think you have no case, you may have a case.  I was asked to take a case where Billy, a motorcycle rider who on first impression was thought to be partially, if not all, to blame for an accident from which he suffered catastrophic injuries.  

Billy was a vibrant, young 20 something motorcycle rider who was not expected to live.  Turns out a lady turned left in front of him in a road construction zone.  Upon further investigation, I discovered that there were potentially many reasons why this accident happened – not all of which could be blamed on the left-turning lady OR Billy.  There were a lot of entities, both public and privae, involved.  
We investigated even further, filed a lawsuit against several defendants and were there for Billy and his family throughout the ordeal.  We litigated aggressively, taking dozens of depositions, hiring legal and medical experts, life care planners, pain management doctors, rehabilitation therapists.
Billy will never be the same, he suffered severe brain damage, multiple broken bones, fractures of the spine.  His family will have to take care of him for the rest of his life.
Through our passionate and zealous representation of Billy, we ultimately negotiated a settlement of just under $8 Million, which will enable Billy to receive the lifetime care he requires.
If you, or someone you know, has been injured in an accident, please contact me immediately at
(323) 852-1100
lowell@steigerlaw.com

Skype (with or without video): Lowell_Steiger


"Treated With the Respect That You Deserve"

Motorcycle Accident $275,000 Settlement

Motorcycle leg injury (69)
     This case is one wherein my client, Bobby, suffered serious injuries as a result of a car making a u-turn in front of him while he drove his motorcycle at a safe speed.  In particular, he suffered a degloving injury to his right leg which necessitated a painful skin graft and had left him with a large permanent scar (see picture to the right). 

    Graphic photos of Bobby's injuries, before and after the surgery, can be seen by clicking here – due to the graphic nature of these motorcycle injury degloving photos, it is inappropriate to just post them here because they are too shocking and one must be forewarned.  You need to affirmatively click here in order to view them.

    Ultimately, the case settled for $275,000 – an amount far and beyond his medical bills and designed to compensate him for the pain and suffering that he experienced as a result of this negligent driver.

Please read excerpts from the mediation brief below.  The names have been changed to protect the anonymity of the parties.

    The instant lawsuit arises out of an incident which occurred on June 24, 2008 on Acme Place just south of Genteel Boulevard in the City of Los Angeles.  Defendant Theresa was driving a 2005 silver Volkswagen Passat in lane 2 of 2.  Plaintiff Bobby, then 24 years of age, was driving his 1994 Honda VFR-750 motorcycle in lane 1 of 2. 

    Bobby, who was suited up with a leather jacket, jeans, safety helmet and motorcycle riding boots,  had been traveling in the same lane, without making any lane changes,  for quite some time.  He was not using his cell phone nor was he listening to any type of music.  He testified in his deposition that he traveled within the 35 mph speed limit for the duration of his drive on Acme.  Further, he was on his way to a cold-reading class at a local community center.  The class, which was only a few miles from his home, was to begin at 7:45 pm.  Bobby would have arrived early having left his apartment at 7:13 pm had it not been for this life-altering accident.

    Plaintiff became aware of Theresa’s vehicle just after passing Genteel Boulevard.  There was nothing in particular that brought it to his attention other than “the fact that there was a vehicle there.” (Bobby Deposition 46:24).  They were both traveling at the same speed and they remained in their respective lanes with Bobby traveling approximately 70 to 80 feet behind.  He noticed her beginning to slow down but because she remained in her own lane he  thought nothing of it until it looked as though she was going to merge into his lane.  He honked his horn, eased on his brakes and tried to move to the left in order to avoid her all the while being mindful of not crossing over the double yellow line into oncoming traffic.

    In actuality, Theresa was not attempting to merge into Bobby’s lane of travel.  Instead, she made a u-turn directly in front of him causing the injuries and damages hereinafter described.

    The Los Angeles Police arrived at the scene, investigated the incident and produced the report.   Theresa stated, in pertinent part, that she made a u-turn in order to change her direction of travel from southbound Acme to northbound Acme and, in so doing, collided with Bobby’s motorcycle.  She says that she never saw him coming which led her to believe that he was speeding.  However, there is no evidence to substantiate that point and, in fact, such a statement is purely speculative.  Finally, she admitted to the investigating officer that the accident was her fault

    An independent witness, Darius, stated that he was driving northbound on Acme and saw Theresa, who was traveling southbound on Acme, make a u-turn.  He witnessed Theresa collide with Bobby’s motorcycle.

    Although Theresa was not cited, the police listed the primary collision factor as a violation of California Vehicle Code §22102 by Theresa.  The code states that

    "No person in a business district shall make a U-turn, except at an intersection, or on a divided highway where an opening has been provided in accordance with Section 21651.  This turning movement shall be made as close as practicable to the extreme left-hand edge of the lanes moving in the driver's direction of travel immediately prior to the initiation of the turning movement, when more than one lane in the direction of travel is present."

*****

    “I felt around my body and thought I was okay at first.  I didn’t notice any problems.  Then I reached to touch my leg, and I felt that it was very small.  So I looked down, and I saw it, and I was actually holding the bone in my leg.  It was completely torn open.  I think the term that the EMT’s used was ‘degloving.’  It was completely torn open, and my hand was inside my leg, at which point I pretty much lost my cool.” (Bobby Deposition, page 58:23 to 59:6)

In this case, it was necessary to file a lawsuit against the driver of the u-turning vehicle in order to move the case along.  Her insurance company, although polite, was not cooperating to the extent that they needed to in order to come to a fair resolution in this matter.  Meanwhile, my client's medical bills were piling up and he still needed skin graft surgery because his wound was not healing.  It remained open!  Aggressive action was required and that action was in the form of a lawsuit.

    The case then moved along quickly.  I found a Board Certified Plastic Surgeon who was willing to perform the skin graft on a lien basis.  This means that he was willing to wait until the matter resolved, either through settlement or judgment rendered at trial, before getting paid.  The surgery center worked on a lien basis as well.

    It is important in injury accidents such as these that the legal aspects are properly handled by an experienced attorney.  My client had no health insurance at the time and faced serious medical issues had I not been able to arrange for treatment in the manner described above.

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If you, or someone you know, has been injured in a motorcycle or automobile (or similar) accident, please call me, Lowell Steiger, immediately at

(323) 852-1100 or send an e-mail to me at lowell@steigerlaw.com

"Treated With the Respect That You Deserve"

Work Injuries Resulting From Negligent Third Party (Someone Other Than Your Employer)

On_the_job_injury Through California’s Worker’s Compensation Laws injured employees are able to recover from the limited benefits of their employer’s insurance.  But what happens in cases where an employee has sustained an on-the-job injury caused by someone other than the employer? Simply put, in addition to filing a workers’ compensation claim, the injured employee may sue this third party (i.e., other person or entity) in tort law. Third party cases may fall into categories such as traffic accidents, slip & fall incidents, defective products, defective equipment or the exposure to toxic substances and any number of other situations.

If a worker suffers a significant injury, it is highly probable that they will not receive sufficient funds from a workers’ compensation claim because workers’ compensation claims are not based upon fault whereas tort claims are based on fault and include monetary compensation for pain and suffering.  Therefore, pursuing claims against a negligent third party is critical to ensure maximum compensation for injuries or death.

           Every on-the-job injury should be evaluated by an experienced attorney to determine if a third party claim exists.

The personal injury component of a workers’ compensation claim is oftentimes overlooked.  Here are just a few examples of such cases that my office has successfully handled (all clients were on-the-job but we also sued a third party on their behalf):

·         Male bus driver rear-ended by automobile.  He suffered a knee injury which required arthroscopic surgery. Significant confidential settlement.

·         Female building maintenance person who slipped due to wet carpets when exiting the elevator of her office building.  At the time of the incident, a carpet cleaning company (third party) was cleaning the carpet and failed to post signs warning of the dangerous condition.  Serious knee injuries. Large 6-figure settlement against the carpet cleaning company.

·         U.S. Postal Worker who was in Los Angeles on business suffered severe burns to his left foot due to the hotel’s providing scalding hot water to the shower.  The client almost lost his leg due to complications.  Significant settlement against the hotel.

·         Male law firm investigator was rear-ended while in the field. He suffered injuries sufficient to require him to undergo neck and back surgeries. Policy limit settlement against the driver of the offending vehicle.

·         Female Cal-Trans worker was in a lift changing a street light when an the top of an 18-wheeler grazed the bottom of her bucket, throwing her several feet out of the bucket. She hung in the air by her safety belts.  The worker suffered severe physical and emotional injuries as a result. Significant 6-figure settlement against the trucking company.

The attorney handling the third party portion of the claim must work closely with the workers’ compensation attorney as well as with the workers’ compensation insurance carrier because of the unique legal issues presented in these situations.

If you have suffered a work related injury and have reason to believe that a third-party may bear some liability, please call or e-mail me to discuss your legal rights.

**********************************************************************************************************************

The Law Office of Lowell Steiger Represents Injured Victims

If you have suffered a Personal Injury, Call for a Free Consultation

Contact Attorney Lowell Steiger at (323) 852-1100

or via e-mail at lowell@steigerlaw.com

"Treated With the Respect That You Deserve"

www.steigerlaw.com

Roof Top Electrocutes Worker by Charles Samo, Safety Engineer

ROOF TOP

ELECTROCUTES WORKER

by Charles Samo, Safety Engineer

Electrocution

Thank you to safety engineer/expert Charles Samo for contributing this fascinating and informative article.  Mr. Samo has been an expert witness in a multitude of litigation matters and can be reached at samoengr@sbcglobal.net.

INTERESTING TIMES

Have you ever wondered why birds resting on high and bare electric conductors do not get electrocuted? It is because the birds are not grounded or rather in contact with the ground.  This is an interesting phenomenon. Whenever a person comes in contact with an overhead power line, if not in contact with ground, he or she is perfectly safe but as soon as a part of the body touches an object in touch with ground, chances of survival are slim. Clearly before the invention of electricity this type of harm or hazard was nonexistent. I am reminded of an old Chinese proverb which when loosely translated, “may you live in interesting times.”

THE ACCIDENT

Interesting times can include exposure to unforeseeable hazards. In one case a man went to work on a roof of a commercial building. He worked for a construction roofing company. He props his metal ladder up against the concrete wall of the building, buckles his tool belt, throwing on his baseball cap but unfortunately leaving his hard hat behind.  He climbed up the ladder onto the old roof, stepped up to the edge of the roof, pulled his metal measuring tape, leaned forward, bent down and began to take roof measurements.  Upon committing the measurements to memory, he rose and leaned back.  Whether he was busy calculating his measurements or just not thinking we will never know, his head came in contact with a high voltage power line conductor, spanning above the roof, electrocuting himself and threw him off the roof.

The lights flickered in the building manager’s office and followed with a momentary black-out.  The building manager went outside to investigate and saw the man on the ground sizzling, his ball cap laid next to him with a hole burnt in the center.

THE INVESTIGATION

The local city fire department’s paramedics arrived within a few minutes and attempted to revive the barely breathing man, but were unsuccessful.  An extensive investigation was launched to determine the cause of the fatality related to this unfortunate accident. The investigation was undertaken by Electric Public Utility Company operating this particular power line, property insurance organization including U.S Occupational and Health Administration (OSHA) of the Department of Labor. Come to find that the building was constructed first and the power line went up shortly after the building was constructed. The power line poles were placed too close to the building.

THE NATIONAL ELECTRIC CODE

Electric safety standards provide safe working guidelines to prevent such accidents. Nearly 100 years prior, in 1897, a document related to electric standards was developed as a result of the united efforts of various safety, insurance, electrical, architectural, and allied interests. This document was called The National Electric Code, or NEC.  It is sponsored by the National Fire Protection Agency, NFPA. At the time of the accident the NEC had specific safety procedures in place to prevent accidental contacts with overhead high-voltage lines.

FACTORS RELATED TO CAUSATION

There were a number of factors which contributed to the death of the worker.  The electric utility company had failed to meet the minimum clearance standards and safety for high-voltage overhead power-lines as required by the NEC. The line spanned too low over the roof and created a significant hazard. NEC required a minimum vertical clearance of 8-feet above the rooftops and a minimum horizontal clearance of 3-feet from the edge of the roofs. Clearly at the time of power line construction these standards were not followed.

RESPONSIBLE PARTIES

As the owner and operator of the electric conductor, the electric utility company is primarily responsible for the death of the worker. The electric company failed to inspect and maintain the line clear from the building as required by its own standards and NEC requirements.

The employer of the deceased failed to provide and maintain a safe working area for his employee who normally worked on rooftops or likely to work near or adjacent to high voltage overhead lines. 

The worker did not take adequate precaution for his own safety while working dangerously close to the high-voltage power line. The deceased had been in construction and roofing business for many years. Either he knew or should have known the hazard presented by overhead electrical wires when working on buildings’ roofs adjacent to overhead lines. Sadly, he was responsible for his unfortunate accident.

10-FOOT SAFETY RULE

The worker failed to follow a simple Federal OSHA’s safety construction industry rule known as a 10-foot Safety Rule. This rule is intended to keep workers away when working near overhead power lines. The rule prohibits workers and equipment from getting closer than 10 feet (radial) to overhead electric conductors.

ZERO RISKS

In our world there are many environmental and occupational hazards that we all face every day. This case is not rare. Very few things in life to which we are exposed are “zero risks”. But like the automobile, and X-rays, there are non-harmful ways to use potentially harmful electricity transported by overhead bare conductors. Applicable industry safety standard practices must be adhered to. If we all follow safety rules provided, it would help to ensure us all live long and ….interesting lives!

SAFETY CONSULTING AND ENGINEERING

E-Mail: samoengr@sbcglobal.net

C. Samo/M. Quecke

*****************************************************************************

The Law Office of Lowell Steiger Represents Injured Victims

If you have suffered a Personal Injury, Call for a Free Consultation

Contact Attorney Lowell Steiger at (323) 852-1100

or via e-mail at lowell@steigerlaw.com

"Treated With the Respect That You Deserve"

www.steigerlaw.com

How the Grinch Stole Free Speech

The following posting is copied from the article Intellectual Property Bullies — This Time It Is the Grinch which was recently posted in the always brilliant Consumer Law & Policy Blog.  I found it quite interesting and provocative and wanted to share it with you.

Grinchstolefreespeech_2 Dr. Seuss –- or, at least, the lawyers for his estate — are at it again.  The victim this time is  Teamsters for a Democratic Union, which put articles on its web site and in its newspaper that portrayed Teamster President James Hoffa as the Grinch.   TDU used an illustration of the Grinch, and used the distinctive font used in the Seuss classic to decry “Hoffa’s Holiday Give-away to Employers.”

Barbara Orr, a lawyer with DLA Piper who represents the Seuss estate, apparently thought that Teamster dissidents who patronize TDU’s web site and read its newspaper might not be bright enough to understand that TDU was satirizing Hoffa by reference to a common cultural icon, the Grinch.  She sent a  cease and desist letter claiming that truck drivers and others might think that the Seuss estate was endorsing TDU (or, might they think that Dr. Seuss was responsible for giving away workers’ contract rights?).  So, she claimed trademark and copyright infringement, and threatened to sue for damages unless TDU promptly signed a letter “agreeing to [the] terms” set forth in her demand letter.

As usually happens in these situations, the intimidation tactic was effective, even though TDU’s plainly non-commercial use for the purpose of commentary would have afforded a strong defense in any lawsuit.  TDU apparently calculated that it didn’t have enough interest in fighting with Dr. Seuss to spend its meagre staff time and resources on a lawsuit, and it has removed the image from its web site.   But society will be the poorer if citizens engaged in criticism of companies (or, in this case, companies and the leaders of their union bargaining partner) can’t refer to such common cultural icons as the Grinch as an embodiment of the sort of evil they seek to criticize. 

This is not the first time that Dr. Seuss has abused intellectual property claims to suppress free speech.  For example, a year ago the blogosphere was buzzing over a threat by the Seuss estate against a musician who recorded “Green Eggs and Ham” in a voice resembling Bob Dylan (the musician could not afford to fight and backed down, of course), or its  successful lawsuit against the publisher or a satirical book, The Cat NOT in a Hat, which used a Dr. Seuss theme to make fun of O.J Simpson trial for the murder of Nicole Brown Simpson and Ronald Goldman.

Bullies need to be put in their place.  Barbara Orr is invited to respond.

**********************************************************************************************

The Law Office of Lowell Steiger Represents Injured Victims

If you have suffered a Personal Injury, Call for a Free Consultation

Contact Attorney Lowell Steiger at (323) 852-1100

or via e-mail at lowell@steigerlaw.com

"Treated With the Respect That You Deserve"

www.steigerlaw.com

Five Insurance Executives Guilty in AIG Fraud Case

Well, there is justice after all.  No one, not even the multibillion dollar insurance industry, is above the law.  I, for one, am glad to see that major corporate greed and deceit has not gone unpunished.  Convictions for, among other things, mail fraud, conspiracy, and false statements to the SEC have humbled at least 5 insurance executives and have hopefully injected indescribable into many other insurnace executives sitting on the sidelines in anticipation of last week’s verdict.

Essentially, the government presented evidence that the defendants engaged in a scheme to falsely inflate AIG’s reported loss reserves, a key indicator of financial health to insurance industry analysts and investors.

The Department of Justice, on February 25, 2008, released the following:

Department_of_justice WASHINGTON – A federal jury has found four former General Re Corporation (Gen Re) Executives and one former American International Group Inc. (AIG) executive guilty, following a five-week long trial, the Justice Department announced today. The Hartford, Conn., jury returned a verdict of guilty on all charges against all defendants contained in a 16-count superseding indictment stemming from a fraudulent scheme to manipulate AIG’s financial statements.

Ronald_ferguson Ronald E. Ferguson, 63, of Fairfield, Conn., Gen Re’s chief executive officer from about 1987 through September 2001, was found guilty on charges of conspiracy, securities fraud, false statements to the SEC, and mail fraud.

Elizabeth_monrad Elizabeth Monrad, 51, of New Canaan, Conn., Gen Re’s chief financial officer from about June 2000 through July 2003, was found guilty on charges of conspiracy, securities fraud, false statements to the SEC, and mail fraud.

Robert Graham, 58, of Westport, Conn., a Gen Re senior vice president and assistant general counsel employed by Gen Re from about 1986 through October 2005, was found guilty on charges of conspiracy, securities fraud, false statements to the SEC, and mail fraud.

Christopher_garand Christopher P. Garand, 59, of Upper Saddle River, N.J., a Gen Re senior vice president and the head and chief underwriter of Gen Re’s finite reinsurance operations in the United States from about 1994 until August 2005 and also a member of the Board of Directors of Cologne Re Dublin, a Gen Re entity, was found guilty on charges of conspiracy, securities fraud, false statements to the SEC, and mail fraud.

Christian_milton Christian Milton, 58, of Winnewood, Penn., AIG’s vice president of reinsurance from about April 1982 until March 2005, was found guilty on charges of conspiracy, securities fraud, false statements to the SEC, and mail fraud.

At trial, the government presented evidence that the defendants engaged in a scheme to falsely inflate AIG’s reported loss reserves, a key indicator of financial health to insurance industry analysts and investors. This fraud was effectuated through the use of two sham reinsurance transactions between subsidiaries of AIG and Gen Re in response to analysts’ criticism of a $59 million decrease in AIG’s loss reserves for the third quarter of 2000. The two sham transactions increased AIG’s loss reserves by $250 million in the fourth quarter of 2000 and $250 million in the first quarter of 2001, masking a declining trend in loss reserves in the face of premium growth. AIG restated the transactions at issue in filings with the Securities and Exchange Commission in May of 2005. Evidence presented at trial established that when the investigation was disclosed to investors by AIG and through various media outlets between Feb. 14 and March 14, 2005, shares of AIG stock dropped from $73.12 to $61.92.

“These convictions continue the string of successes in our crackdown on corporate fraud and our effort to restore integrity to our financial markets,” said Acting Deputy Attorney General Craig Morford, chairman of the President’s Corporate Fraud Task Force.

“The investing public must be able to trust and rely upon corporate management to provide accurate information in their public filings,” said Assistant Attorney General Alice S. Fisher of the Criminal Division. “As these convictions demonstrate, executives who violate the criminal laws by deceiving investors or aiding in that deception will be held accountable.”

“We’re very pleased with the jury’s verdict, as it sends the appropriate message that those who engage in corporate wrongdoing will be held accountable,” said U.S. Attorney Kevin J. O’Connor of the District of Connecticut.

“Take note – this is a resounding verdict and a strong message of deterrence and accountability in a significant corporate fraud prosecution, said Chuck Rosenberg, U.S. Attorney, Eastern District of Virginia.

“Today’s verdict proves that the integrity of our nation’s postal system cannot be undermined by unscrupulous business executives,” said Alexander Lazaroff, Chief Postal Inspector, U.S. Postal Inspection Service. “The federal mail fraud statute enforced by U.S. Postal Inspectors is there to stop them.”

The government presented evidence at trial that showed that each of the defendants knew that the true purpose of the transactions was to permit AIG to falsely report increasing loss reserves in its statements to analysts and investors and its filings with the SEC. The defendants structured a sham reinsurance transaction and created a phony paper trail to make it appear as though Gen Re had solicited reinsurance from AIG when the evidence demonstrated that the parties knew AIG wanted the transaction to manipulate its financial statements. Additionally, the defendants entered into a secret side deal whereby AIG would never have to pay any losses under the contracts; AIG would return to Gen Re the $10 million in premiums Gen Re paid to AIG and AIG paid Gen Re a $5 million fee for entering into the transaction.

Ferguson, Monrad, Milton and Graham each face a maximum term of imprisonment of 210 years in prison based upon their conviction on all counts and a fine of up to $46 million. Garand faces a maximum term of imprisonment of 150 years and a fine of up to $29.5 million.

The sentencing date for all defendants has been set for May 15, 2008. All defendants remain free on bond pending sentencing.

This continuing investigation was initiated by the Criminal Division’s Fraud Section and the U.S. Postal Inspection Service. The case was prosecuted by Fraud Section Principal Deputy Chief Paul E. Pelletier, Trial Attorney Adam Safwat, and Assistant U.S. Attorneys Eric J. Glover of the District of Connecticut and Ray Patricco of the Eastern District of Virginia. Additional assistance was provided by Paralegal Specialists Sarah Marberg, Fraud Section and Amy Konarski, District of Connecticut along with U.S. Postal Inspectors James Tendick, Mary Giberson, Paul Boyd and Cathy Cantley and Consumer Fraud Analysts David Cyr, Charles Willetts, and James Walsh.

Additional Related Links

New York Times

Financial Week

Insurance News: More Insurer Trials Likely

Washington Post

Jurist Paper Chase Blog

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The Law Office of Lowell Steiger Represents Injured Victims

If you have suffered a Personal Injury, Call for a Free Consultation

Contact Attorney Lowell Steiger at (323) 852-1100

or via e-mail at lowell@steigerlaw.com

"Treated With the Respect That You Deserve"

www.steigerlaw.com

Case of the Dangerously Icy Sidewalk: Broken Ankle, Six Figure Settlement

Ankle_fracture Miss May T., a then 17 year old girl, slipped on black ice outside of a convenience store and suffered an excruciatingly painful bimalleolar fracture of her right ankle.  Her injuries were so severe that massive swelling ensued and the doctors were unable to operate on her ankle for over a week!  While May writhed in unspeakable pain and doctors were unable to do anything more than give her pain pills (which she was reluctant to take), the insurance carrier for the convenience store denied liability!

A massive liability dispute arose.  I hired a meteorologist, a slip and fall expert and a private investigator to get sworn statements from the convenience store’s own employees.  The sum and substance of the case is as follows:

My meteorologist advised me that weather reports attested to the fact that it had been snowing during the evening and entire night of the evening prior to the incident, possibly extending into the early morning hours of the morning of the actual incident, with the existence of sub-freezing temperatures during the night and early morning hours. The day of the accident presented mostly sunny conditions throughout the daytime hours. The incident occurred at approximately 9:00pm at which time there was an accumulation of ice from the previous night’s weather conditions which could, and should, have been treated, melted and cleared.

Private_eye My private investigator obtained sworn statements from store employees which substantiated the fact that, throughout the day, customers complained of the icy conditions on the sidewalk outside of the subject convenience store. Those statements provided testimony that the assistant store manager, Vickie, was advised a multitude of times of the customer complaints but failed to remedy the dangerous condition. Vickie repeatedly told employees that customers "just needed to be careful." Vickie further told the convenience store employees that the store had no rock salt with which to remedy the situation in its possession. However, subsequent to May’s fall, and then upon further investigation, the convenience store employees discovered that rock salt did, in fact, exist in the the convenience store storeroom. At that point, the rock salt was utilized to de-ice the subject sidewalk and thereby remedy the dangerous condition. Vickie’s failure to timely investigate and make safe a very dangerous condition was the actual and proximate cause of May’s injuries (see, for example, Langhorn Road Apartment v. Bisson, 207 Va. 474 (1996) where an apartment owner was found liable when the plaintiff fell on an accumulation of ice and snow).

The egregious and uncaring conduct of Vickie resulted in this dangerous condition persisting throughout the day and, ultimately, into the night when an unsuspecting May T. exited the convenience store, slid across the sidewalk and was stopped when her foot slammed into a concrete device which was intended to stop a moving vehicle!

Danger Where was the danger sign?  Where was the simple repair that could have saved May from such excruciating, and unnecessary pain?  The answer is: No where to be found and this lack of action on the part of the convenience store was a breach of their duty to May, their customer, to protect her from an unreasonable risk of harm.

May suffered a fracture of her ankle as well as a torn ankle ligament all of which which required major surgery with the placement of a five-hole plate with two screws above and below the fracture line.  To this day, Miss T. suffers pain in that ankle and is expected to ultimately develop arthritis.

After months, and months, of argument and negotiation, I was able to convince the insurance carrier for the convenience store that, yes, their insured did bear the responsibility in this matter.  The insurance carrier made a six figure offer to settle May T’s case. 

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The Law Office of Lowell Steiger Represents Injured Victims

If you have suffered a Personal Injury, Call for a Free Consultation

Contact Attorney Lowell Steiger at (323) 852-1100

or via e-mail at lowell@steigerlaw.com

"Treated With the Respect That You Deserve"

www.steigerlaw.com

Rear-Ended By Drunk Driver: Leads to Surgery, Large Settlement

Rearend_collision How horrific it was for my client, Mrs. F., an innocent woman legally slowing down for a stop to be suddenly, and without warning, be rear-ended by a drunk driver.  Otherwise in great health, this lovely lady’s life was turned asunder by the flagrant disregard of a guy who was more concerned with his afternoon cocktails than the safety of other people on the road on which he drove.

The physical impact to Mrs. F’s car was so severe that it was deemed a total loss.  In particular, the insurance company felt that it would cost more to repair her car than the $30,000 that it would cost to replace it! 

Discectomy Mrs. F., was so seriously injured that she required neck surgery to remove and replace the discs in her cervical spine at two different levels in an effort to relieve the symptoms of the herniated discs in her neck.  The herniations were deemed to have been caused by this accident.

Medical Bills: Over $100,000.  The drunk driver’s insurance policy had a limit of $25,000 which was paid very quickly to Mrs. F.  However, what to do when her medical bills and pain and suffering far exceeded the drunk’s policy limits?  Fortunately, Mrs. F. was savvy enough to have Uninsured Motorist Coverage which is also known as Underinsured Motorist Coverage with a limit of $500,000.  Simply put, Mrs. F’s insurance policy "stepped into the shoes" of the drunk driver and treated this case as though they were insuring the drunk driver. 

Our office prepared a detailed settlement demand package which included all of the details of the accident, injuries, treatment (and all relevant medical reports, surgical reports, treatment reports) and what Mrs. F could now expect in her future.  With that in mind, we demanded the entire $500,000 from Mrs. F’s insurance own company under the provisions of her Uninsured/Underinsured Motorist Policy.  Due to the severity of the injuries, her insurance company tendered the entire $500,000 less a credit for the $25,000 that she received from the drunk driver’s insurance carrier.

I routinely advise my clients that it is imperative that they carry as much automobile insurance as they can afford — and very importantly, Uninsured Motorist Coverage.  I hope that what happened to Mrs. F. never happens to you but, in the event that it does, it is best to be covered to the greatest extent possible.  In another posting I will discuss Medical Payments Coverage.

The Law Office of Lowell Steiger Represents Injured Victims

If you have suffered a Personal Injury, Call for a Free Consultation

Contact Attorney Lowell Steiger at (323) 852-1100

or via e-mail at lowell@steigerlaw.com

"Treated With the Respect That You Deserve"

www.steigerlaw.com

Case of the Exploding Wine Bottle: Personal Injury Settlement

Alsp_bottle_001 A fascinating product liability case involved a wine conossieur who, while attempting to uncork a bottle of wine, was using a cork extractor which operates as follows: A needle is inserted through the cork, the user pumps the spring-loaded handle and air pressure then forces the cork out. The result is shown in the picture to your left. 

Mr. A. had owned the cork extracting unit for several years and, up to the date of his injury, had used it to uncork at least 200 bottles of wine. Although he reports that the cork is usually extracted on the fifth to seventh pump, the bottle exploded on the fourth or fifth pump on this grim occasion.  Alsp_hand_2

He reports that he immediately knew that his hand was dramatically injured because he could not feel anything and, as he held it up, blood started gushing heavily from the wound.  

It was my theory that the bottle itself was defective.  I engaged the services of a phenomenal expert, Fred Johnson, Ph.D., whose credentials as a professor of physics at Cal State Fullerton spoke for themselves.  Alsp_bottle_002 Dr. Johnson examined the bottle with the use of a high magnification microscope and determined that there were two major defects in the subject wine bottle: (1) Very uneven glass thickness and (2) an obvious glass anomaly (bubble), which weakened the bottle’s integrity, such that when the internal gas pressure was applied (in order to remove the cork) it caused a catastrophic failure of the bottle.

Mr. A. sustained serious injuries as a result of this manufacturing defect.  Alsp_hand_002_2 To whit, he suffered a laceration to the flexor tendon in the ring finger of his left hand.  Although doctors attempted to surgically repair the injury, Mr. A permanently lost the use of his finger (see photo to left)

Settlement: We were able to achieve a settlement for Mr. A against the bottle manufacturer and the store who sold it to him of over $100,000.

The Law Office of Lowell Steiger Represents Injured Victims

If you have suffered a Personal Injury, Call for a Free Consultation

Contact Attorney Lowell Steiger at (323) 852-1100

or via e-mail at lowell@steigerlaw.com

"Treated With the Respect That You Deserve"

www.steigerlaw.com