The United States Supreme Court dealt a deadly blow to Americans seeking justice when faced with forced arbitration clauses. Its decision now permits corporations to give themselves immunity, whenever they cheat consumers/employees. By forcing arbitration and banning class action lawsuits, big corporations can get away with wrongs that affect huge numbers of consumers, especially if the amount of damages would not justify individual claims.
SCOTUS chose to ignore the blatant fact that numerous states consider provisions bans on class action lawsuits unconscionable. Such is the case in Washington State.
Here are some brief facts about the backgroung of AT&T Mobility v. Concepcion:
- Liza and Vincent Concepcion sued AT&T in 2006, alleging that the wireless carrier defrauded millions of customers in California by advertising phones as “free,” then tacking on an undisclosed $30 charge for the phone.
- If multiplied across all AT&T customers, the $30 charge would amount to millions of dollars in allegedly wrongful gains.
- AT&T sought to dismiss the case by invoking a forced arbitration clause containing a class-action ban that it had placed in the Concepcion’s contract.
- Both the California District Court and the Ninth Circuit rejected AT&T’s request, holding that the class-action ban was unconscionable under California law because it would exculpate the company from accountability for wrongdoing.
- Courts applying the contract law of 20 states have struck down class-action bans for the same reason – because they would function as a “get out of jail free” card for corporate wrongdoing.
According to a recent article in the Seattle Times, Young Zina Linnik, a 12 year old girl, was abducted on the night of July 4, 2007. A deputy sergeant called Tacoma Police spokesman Mark Fulghum at home about 4 a.m. on July 5, asking him to send out an Amber Alert.
Rather than issue the Alert immediately, Mr. Fulghum fell back asleep.
Mr. Fulghum had taken Advil PM at about 1 AM earlier on July 5th. Unfortunately, he was the only person at that point under Tacoma Police Department’s unwritten policy who had the authority to Amber Alerts.
Since then, the Tacoma Police now has a formal written policy, allowing officers with the rank of sergeant or above to issue the alerts without going through Fulghum. The organization apparently learned at least something from its errors, despite its claims that issuing an Alert earlier would likely not have helped.
Interestingly, one of the first police supervisors on the scene, had requested that an Amber Alert go out less than an hour after the abduction.
With indications that the young girl likely died soon after her abduction from trauma to the head, Fulghum said to The News Tribune that “I don’t know that it would have made any difference by going out a few hours earlier.”
Note that experts on child abductions say that such alerts should be issued within four hours from the time a child is kidnapped.
Tacoma Police continues to say that it did nothing wrong because issuing Amber Alerts are voluntary.
Looks like that Department needs to get clear on the significance and reasons for Amber Alerts. After all, these Alerts contain critical information and have repeatedly served as an important tool for law enforcement to locate abductors.
Trial is set for this September. Zina Linnik’s family will undoubtedly mourn her loss for a long time. But hopefully the lawsuit will help obtain the justice they seek against the Tacoma Police Department, Pierce County, and the State of Washington.
Mickey Gendler became a quadriplegic because of governmental negligence. On the one hand McKenna praised settlement of the case saying it was the right thing to do. On the other McKenna has been pushing the legislature to protect the Government from being sued in the future.
Today Mickey Gendler speaks the truth in an editorial published by The Seattle Times. It is a beautifully written piece. I can hear the outrage in his voice. Government officials should spend their energy protecting the safety of citizens. Instead of trying to create new laws that would give them a free license to harm.
This Monday marks a decade since our client Kris Kime was beaten to death during the Mardi Gras Riots.
I had the privilege of representing the family. They came together to my office. Ken the father, Kim the mother. And even though they had long since been divorced, they came united as a family. I came to know Kimberlee, Kris’ step mom. His brother Keith. His sister Kirsten. His brother Cameron. His grandparents. Through them, I learned who Kris was and how much he was loved. I wept with them when his killer Jerrell Thomas was convicted and sentenced to present. I wept with them when his conviction was overturned for legal reasons and his sentence plea bargained down. I went to Kirsten’s wedding and met some of the people who had received Kris’ organs. I’m thankful for facebook so I can see what they are up to. And my breakfasts with Kim who is one of the most caring people I’ve ever known.
Kris Kime would have been 30 years old on Monday. His life was too short. But it was not in vain.
King5 did a show in memory of one of the most shameful incidents in our city’s history. A moment when police were ordered not to help citizens in need. They did a 2nd story on the killer. If you are in pioneer square visit Kris’ memorial by the pergola. Light a candle. And think of the greater humanity that this young man and his family stand for.
In case you missed it, an insightful editorial appeared in this Sunday’s The Columbian, “Courts keep failures by state agencies in check.” Magana and Wieland point out the serous problems with endorsing special legal protections for state government agencies whose negligent actions or inactions cause harm to citizens.
Importantly, Magana and Wieland explain that “government is never responsible for anyone’s actions but its own, and is never judged on any failures or bad choices except for its own.” Only if “but for” the government’s failures did an injury arise, then it could it then be held liable.
Please read the piece in its entirety for a thoughtful and accurate explanation to understand why we must continue to hold the government accountable via lawsuits in Washington state.
In the interest of full disclosure, one of the authors of this editorial is Jesse Magana, a client of Stritmatter Kessler Whelan.
As we head into this year’s first legislative session, the law firm of Stritmatter Kessler Whelan (SKW) wants to provide an informational resources via a new website, KeepWASafe.com. As the days and weeks progress, please visit it frequently for more information, which will help you understand why the agenda to bar lawsuits against the state for tort cases will make Washington less safer for all of us.
We welcome your comments and questions.
We pay a lot of taxes. Our Government gets to use those taxes to supposedly help take care of us. It is supposed to build and maintain safe roads for us. Monitor and take care of our state’s abused children. Make sure that criminals on parol are actually being watched over so they don’t kill us in our sleep.
But our government doesn’t always do a good job. We find this out through tragic headlines. We find it out when people sue to hold the Government accountable. To prevent bad practices from continuing.
Our State Attorney General wants to limit lawsuits against the Government and its insurance companies. It wants to create a special class that is above the law. And it wants to be the only one in that class.
All the rest of us are responsible if we mess up. But the Government won’t be if new laws are passed.
This may save money in the short run. But what about the long haul. If we take away government checks and balances, then what kind of a monster will we be creating. What incentive will the government have to get things right – if they are above the law.
By Keith L. Kessler
Yesterday AM, KUOW aired an uneven story about the fact that WA State has recently had to make large payouts in tort claims. The reporter, Austin Jenkins, opened his story with a brief description of a recent SKW cases, which I handled: This was the case of Mickey Gendler, a lifelong cyclist and attorney, who was seriously injured in a bicycle accident in 2007.
Mr. Jenkins failed to mention that the State admitted that the $8 million award was justified.
When interviewed by a Seattle P-I reporter, the risk management director of WSDOT, John Milton said, “This was a catastrophic event to a very strong individual. This was the right thing to do for both Mr. Gendler and the taxpayer.” [emphasis added]
When tragedy strikes an individual, in the form of an unpredictable accident, all of those responsible need to be held accountable. Even when one of those parties might be the State.
We learned a great number of valuable lessons from a recent case against a Native American Tribe and wanted to make sure to pass on at least one of these lessons here. I’ll just mention one for this post and perhaps save the rest for future posts: Remember to think about taxes, especially if you want a settlement to be considered tax-exempt.
A recent case involved a client, who was raped by a juvenile offender. That juvenile was a member of a Native American tribe and had a long list of criminal convictions who had been subject to an equally long list of court orders and restrictions. As a ward of the tribe, his actions were under the control of the tribe’s Indian Child Welfare Department. We thought the department had abrogated its responsibilities and acted negligently in several of its decisions and actions, which all led inexorably to the rape of our client. We decided to sue the tribe for the injuries our client suffered. We eventually settled the case for $1 million
Here’s where the issue of taxes enters the picture: In 1996, the “physical” was inserted into the Internal Revenue Code 104(a)(2), requiring that for a settlement to be considered tax-exempt and eligible for a tax-exempt structured settlement, it must have its origin in physical personal injury or physical sickness. For a settlement to have its origin in physical injury and thus be tax-exempt under IRC 104(a)(2), there must be some Observable Bodily Harm (“OBH”). Some examples of OBH include bruises, scratches, swelling, cuts and bleeding.
Since 1996, the taxation of damages received from sex abuse cases has been particularly problematic. Sex abuse cases inherently involve issues regarding the preservation of evidence of physical harm. By the time the abuse has been reported or the victim can articulate the abuse, any physical injuries may have healed leaving little or no evidence of physical injury. This can make it difficult to meet the OBH standard to satisfy the physical injury requirement of IRC 104(a)(2).
The complaint or settlement demand documentation remains a critical piece of the puzzle. If these documents allege only non-physical injuries such as the intentional or negligent infliction of emotional distress, classifying the damages as taxable is consistent with the pleadings. Therefore, remember to include details of physical injury as the origin of a claim in your complaint or settlement demand, to support the position that the settlement is tax-exempt as being based in physical injury. Also remember to collect and preserve proof of any physical injury whenever possible, as additional support just in case.
When closing a sex abuse case, the negotiation and finalization of the settlement can also help ensure that the damages will be classified as unambiguously tax-exempt. Do the parties, and most particularly the payor, intend the payment as compensation for personal physical injuries? If so, the settlement documentation should specifically state such intent. Be sure that you insert the necessary language in your pleadings and in any settlement documents in order to avoid adverse tax consequences.