The bad news continues to roll in for Theranos. Earlier this week, the embattled blood-testing startup had to issue refunds to anyone in the state of Arizona who had used its services. Today, The Wall Street Journal reports on new allegations made by a Theranos investor in a recently filed lawsuit.
The United States is a notoriously litigious society. Suing the crap out of everything that moves is as American as bad comic book movies or defiant ignorance. Distasteful as it can seem, however, our endless appetite for lawsuits can play in favor of the individual. You can't challenge corporations to a duel, or tar and feather executives and ride them out of town on a rail—not legally, anyway—so a lawsuit is often the only option when you get screwed by big business. Fortunately, the Constitution includes the Seventh Amendment in the Bill of Rights, which guarantees Americans the right to civil trials by jury.
The bad news is, it's being eroded.
A rash of corporate-friendly Supreme Court decisions in recent years has erected substantial barriers for those seeking recourse against companies they feel have ripped them off or harmed them in some way. And all signs indicate that the Trump administration will only further entrench the rights of businesses large and small to do whatever they want to people across America.
Perhaps the most glaring threats to Seventh Amendment rights are arbitration contracts and class-action limitations. Forced arbitration, if you've lucky enough to have never been subject to it, is when people essentially sign away their right to sue in favor of a private hearing, which can be heavily tilted in a company's favor. The concept is particularly common with businesses selling services like nursing home care, credits cards, and cell phones, and those with near-monopoly powers, like cable providers. (Decades of corporate efforts to choke off lawsuits before they can even begin largely flew under the public's radar until a 2015 series in the New York Times enumerated how challenging it is for some consumers to take a business to court. )
The surging popularity of forced arbitration stems from a broad interpretation of a 1925 law aimed at resolving disputes between businesses—courts have consistently said it covers agreements between companies and their customers, too. More recently, Supreme Court rulings in AT&T Mobility v Concepcion in 2011 and American Express v Italian Colors Restaurant in 2013 suggested that arbitration agreements can also prohibit class-actions, forcing wronged consumers to bring action on an individual basis if they want compensation.
"The reach of the law has been dramatically expanded to cover arbitration agreements of any kind," says Richard H. Frankel, a professor at the Drexel University School of Law. "It's essentially an immunity clause for a company."
Under the Obama administration, federal agencies took notice, and began to intervene. For example, the Consumer Financial Protection Bureau (CFPB) was considering a rule to prohibit class action bans in arbitration clauses for financial services products, but implementation looks far less likely under Trump's presidency.
"In the Obama administration, we thought we would get assistance from federal agencies under a number of statutes, and did," says Scott Nelson, an attorney with Public Citizen, a group that represents plaintiffs in litigation related to arbitration clauses. "Those promptly got challenged in court, and now we're waiting to see whether the new administration will pull the rug from under those things by rescinding rules or taking a dive in litigation."
The most immediate threat to courtroom access is the Fairness in Class Action Litigation Act of 2017, which passed the House of Representatives in March and is under consideration by the Senate. Among other things, the bill would both make it harder to form a class action by narrowing requirements for what plaintiffs must have in common, and more difficult for their lawyers to get paid. Instead of having a jury decide a case on its merits, many lawsuits might never even be filed.
"It's creating harder evidentiary standards for plaintiffs to meet," says Alexandra D. Lahav, a professor at the University of Connecticut School of Law who testified in Congress regarding previous iterations of the bill. "It really cuts victims off at the knees."
The bill is backed by the US Chamber of Commerce and other business groups, who claim frivolous class actions are raging out of control, led by greedy lawyers seeking windfalls at the expense of hard-working corporations (and their executives). But the legislation, Lahay argues, is a nasty bit of overreach.
"This bill doesn't try to balance interests," she says. "It's trying to limit fees in ways that aren't responsive to the problem but are really aimed at starving plaintiffs' attorneys and not making it financially viable to bring cases."
Looking ahead, the Trump administration's ability to reshape the federal judiciary could spell considerable peril for the Seventh Amendment. In addition to the seat on the Supreme Court just filled by conservative (and corporate-friendly) Neil Gorsuch, there are over 100 vacancies in lower courts around the nation. A mass influx of new conservative judges could serve to cement the sorry state of regular people trying to hold large corporations to account.
In the fall, the Supreme Court will hear three cases related to arbitration provisions banning class actions in employment agreements—the things people sign when they start jobs. Meanwhile, famous employer Donald Trump has proven he believes in arbitration, and has used it in the past to protect his own business interests. Chances are things won't get better for consumers while he's in office, and his luxury remodeling of America's court system could make their lives harder for decades to come.
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As Jennifer Lopez is apparently learning, it’s hard to be a social influencer.
In June 2014, three days after purchasing a $1.4 million home in New Jersey, the Broadduses got their first letter. It was a dark warning from someone who called himself the "Watcher," claiming the couple's new home rightfully belonged to him. The Watcher had a terrifying, albeit simple message for the family: Get out.
Now, the couple's lawyer claims the Watcher has struck again—sending them a letter at the end of February after a new renter moved in that was "more derogatory and sinister than any of the previous letters," the AP reports. But it's hard to imagine anything creepier than what the family received in the past.
"Have they found what is in the walls yet?" one letter read. "In time they will. I am pleased to know your names and the names now of the young blood you have brought to me."
The Broadduses, who have young kids, understandably freaked the fuck out when they started hearing from the Watcher and tried to move out ASAP, but under their unfortunate circumstances, they couldn't find anyone who wanted to buy their home.
The family then sued the previous owners of their house in 2015, alleging they too had received letters from the Watcher but failed to disclose that pretty important piece of information during the sale. The old owners countersued for defamation, claiming that though they had received a letter, it wasn't threatening, and the media attention they received from the whole Watcher scandal gave them a bad name.
Recently, the Broadduses filed another suit against the town of Westfield, which has refused to allow the couple to demolish their house and split their property into two lots, on which they could build separate homes. For now, at least, the family is stuck renting out their million-dollar mansion some mysterious stalker insists is his.
"All of the windows and doors in [the house] allow me to watch you and track you as you move through the house," a previous letter reads. "Will the young bloods play in the basement. Who has the rooms facing the street? I'll know as soon as you move in. It will help me to know who is in which bedroom then I can plan better."
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Donald Trump's streak of allegedly stiffing people on payment has apparently has made its way north, at least according to one construction company.
Last week, Urban One Construction Management, Inc., a construction company in Vancouver, filed a suit against Trump Tower developer Holborn Developments for allegedly failing to pay their company around $700,00 for work done on the tower.
According to Urban One owner Alan Beron, this is the first time Urban One has ever had to sue any company.
""Unfortunately, in this exceptional circumstance, litigation is our only option," Beron told Vancouver Business. "Prior to filing of this lawsuit, Urban One worked hard to negotiate a settlement with Holborn Developments (West Georgia) Ltd., the developer of Trump International Hotel & Tower Vancouver. Unfortunately, the negotiations were unsuccessful."
The suit comes after Holborn Developments filed one against Urban One for, essentially, alleging shoddy work and a failure to meet contract agreements on the construction of the tower. Urban One states that the work Holburn is alluding too is a result of the company's lack of payment. None of these claims have been proven in court
Urban One is now the fourth company to sue to the tower—it has joined the ranks of Erwin Construction Corp, West Georgia Holdings, Nova Stone, Inc., and Catcan Holdings, Inc. who have all filed lawsuits recently against the developers.
Trump's spawn, Eric and Don Jr., were on scene in February for the launch of the tower and were met with protests. On the day of the launch, the tower erroneously tweeted it was the first tower built in Vancouver in six years (it wasn't) and stated the tower had 69 stories (it doesn't).
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If you purchased a computer between April 1 2003 and December 31, 2008 that included a DVD drive, you might be eligible to claim $10 from a class action lawsuit.
South Korean musician and actor Ji Chang Son made headlines recently for filing a lawsuit against Tesla after his Model X blasted through the wall of his house when he was attempting to park it. That much isn’t in dispute. What is somewhat up in the air is that Son claims the car accelerated on its own, and that it’s…
The election of Donald Trump to go along with a Republican-controlled Congress means that all of a sudden, the long-held conservative dream of repealing the Affordable Care Act, a.k.a. Obamacare, is about to come true. But what happens after that repeal is far from clear. Though Republicans and right-wing think tanks have some ideas about what they would replace Obamacare with, GOP officials haven't hammered out specifics yet. Their current strategy seems to be to repeal Obamacare, but delay putting the repeal into effect in order to give themselves time to craft an alternative.
They have to tread carefully, because simply erasing the ACA would not only leave an estimated 20 million people without health insurance, but potentially cost the country 3 million jobs by 2021, according to a recent study by the Commonwealth Fund. It's also a move that 75 percent of Americans disprove of—even some Trump supporters don't want to see Obamacare end.
But just as some Republican-controlled states have fought Obamacare tooth and nail for years—refusing the Medicaid expansion it offered, and taking the federal government to court—liberal states may make moves to protect their local economies and residents should the ACA be repealed. To find out how that battle might be conducted, I spoke with Jill Horwitz, a health policy expert and law professor at UCLA. Horwitz shed some light on why there have been so many challenges with Obamacare, and what state legislatures can legally do should Congress pull the plug on federal funding.
VICE: Let's start with the basics: What is the Affordable Care Act doing well and how does it fall short?
Jill Horwitz: The pros of the ACA are that it covered many millions of people who didn't have insurance and it made it reasonably affordable to many of them. It stopped the ability of insurers to drop you in your time of biggest healthcare need, and it seemed to be going some way to controlling costs.
The downside is that it didn't reach everybody that it was meant to reach. Many of the plans on the state exchanges [created by the ACA] were still very expensive for some families, so they couldn't afford to get their insurance on those exchanges. And it hadn't done all the work that it needed to do for changing the way that medical care was delivered in the country. But it was on the way to doing that—I think we saw all kinds of signs that it was working and that it needed reform, not elimination.
So what will happen if it gets repealed?
If a repeal goes through it could mean over 20 million people are going to lose their health insurance. Not only that, those of us who get their health insurance from our employers are going to find that insurance companies reinstitute annual caps on spending just at the very point where we most need help. There's going to be enormous dislocation in the medical industry, because patients need to be insured for hospitals to survive—and health care is 17 percent of the GDP. You play with it this irresponsibly there are going to be bad effects.
When Obamacare was passed, states were given the ability to expand Medicare if they wanted, as well as set up their own state-specific marketplace where people could purchase health insurance. Why was it important to allow states to do that?
There were legal reasons, but I think it was more of a political calculation. In our contemporary political order, federal plans are "bad" and state plans are "good," so this was a way to let states do what states wanted to do under some constraints and with the federal government footing a lot of the bill.
What would happen to the states that elected to expand Medicaid if Obamacare were repealed?
First of all, Congress can't fully repeal Obamacare tomorrow, but they can pull the plug on a lot of the funding for it. What does that mean? That states couldn't afford to pay the bills on Medicaid. If [Congress] follows through with this with no replacement, then all those expansions, all those people who were able to get health insurance because of the Affordable Care Act and the expansions through Medicaid, won't be able to get it anymore. They will not have health insurance.
Considering that states like California might see some significant economic losses should Obamacare be repealed, what can states do to push back? Can they delay any changes with lawsuits?
Yes, you bet there are going to be a lot of lawsuits. One thing that is very clear is that even states that are as big and economically powerful as California cannot keep Medicaid and the exchanges running the way they are today without the federal subsidies. It's just too much money.
First we have to know exactly what [Congress is] going to do—it's very hard to plan a lawsuit when you don't know what you'll be challenging. There's been little detail. We hear things for example about the federal government giving block grants to states to have high-risk pools—things we've seen not work before. If they do that, the states may well sue and say, "Well, you had an obligation, we relied on you when we set this whole thing up, and this is a bit of a bait-and-switch."
When he was campaigning, President-elect Trump said that he would make sure that everyone was covered, but no one knows how he plans to do that. One of the things he's said is that we're going to let insurers compete across state lines, but there are places where insurers are allowed to compete across state lines and there are no cost savings there. And even if on the most generous estimates of how much there would be in cost savings, you're many orders of magnitude away from getting the savings that would be required to cover the uninsured in America.
Do you think states could try to create their own "universal" statewide health insurance plans, like Colorado tried to do recently?
You know they might try to do it but again, the power to tax is at the federal level for the most part, not at the state. So you need resources redistributed from the feds to the states. California state income taxes and New York City income taxes are already pretty high, right? So raising state income taxes doesn't seem like a viable solution. It's really hard to see what good is going to come out of this.
This interview has been edited for length and clarity.
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Coca-Cola has long made some pretty crazy health claims about its sugary products. A fresh lawsuit takes aim at the company for “engaging in false and misleading marketing of sugar-sweetened beverages,” according to the lawsuit, first reported by the Center for Science in the Public Interest.