Watchdog Blog

Ignoring Patient Safety = $1 Trillion Waste

Former Bush administration Treasury Secretary Paul O’Neill identified a simple but crucial element that should be front and center in the health care reform debate and legislation: improving patient safety, which would, in turn, reduce health care costs.

O’Neill rhetorically asked in this New York Times op-ed piece:

• Which of the reform proposals will eliminate the millions of infections acquired at hospitals every year?

• Which of the proposals will eliminate the annual toll of 300 million medication errors? 

• Which of the proposals will eliminate pneumonia caused by ventilators?

• Which of the proposals will eliminate falls that injure hospital patients?

• Which of the proposals will capture even a fraction of the roughly $1 trillion of annual “waste” that is associated with the kinds of process failures that these questions imply?

“So far,” O’Neill wrote, “The answer to each question is ‘none.’”

O’Neill calls it waste – that is, the unnecessary harms done to patients on a daily basis and, he estimates, a trillion dollars in annual costs to address those harms. He said that hospitals themselves can adopt simple processes, such as hand-washing and proper preparation of surgical sites, to cut down on costly injuries and deaths. He also suggested that members of Congress seek more information on the dire problem of hospital-acquired infections, provider errors and other similar “waste indictors.”  To sum up, he said: “(A)ny health care reform that does not address the pervasive waste and the associated burden of needless suffering for patients and staff alike will give us little to celebrate.”

Congress should heed O’Neill’s call. 

Misplaced Malpractice Reform

by Kiren Gopal

According to President Obama, health care reform should control costs, expand coverage, improve care, and guarantee choice.  As Congress works to find politically palatable solutions to achieve those goals and health care interests continue to lobby – to the tune of $1.4 million daily – some legislators instead choose to offer proposals to limit medical liability.

These proposals are based in part on the theory that frivolous malpractice claims are epidemic and represent a significant component of health care costs.  But according to the latest Public Citizen study of the National Practitioner Data Bank, nearly two-thirds of the individuals who were compensated in 2008 suffered an injury that resulted in “significant permanent injury, major permanent injury, quadriplegia, brain damage or the need for lifelong care, or death.” These claims can hardly be described as frivolous. Perhaps the most telling point from the NPDB study is that the medical malpractice liability system accounts for just 0.6 percent of national health care costs. Reducing accountability for medical malpractice is clearly an unsuitable focal point for reducing unnecessary costs. 

Sorry Works: Change We Can Believe In?

by Kiren Gopal

At a recent speech before the American Medical Association, President Obama expressed a concern for medical malpractice lawsuits and said that “we need to explore a range of ideas” to tackle the issue. However, the president hasn’t offered much in the way of clarification of his position on medical liability reform.  The only indication was a reported comment of a White House spokeswoman who “pointed to his support as a senator for a mediation program known as ‘Sorry Works.’”

In 2006, then-Senators Obama and Clinton introduced MEDiC (National Medical Error Disclosure and Compensation).  They wrote in the New England Journal of Medicine that the program would provide grant money to health care providers to “implement programs for disclosure and compensation.”  In practice, this means that health care providers would disclose medical errors to the patient, offer an apology, and then try to negotiate compensation.  Additionally, the data yielded from the program would be analyzed to determine best practices.  The potential benefits of such a program are manifold: improved quality of care, more effective doctor-patient communication, and lower administrative and legal costs.

Poll: Americans Oppose Forced Arbitration, Demand Corporations Be Held Accountable

Wide support exists across party lines for Arbitration Fairness Act; consumers, employees from around U.S. lobby lawmakers today

Washington, DC – Americans widely oppose corporations using mandatory binding arbitration clauses in the fine print of consumer and employment contracts, according to national polling of likely voters conducted by Lake Research Partners.

Forced arbitration clauses are hidden in the fine print of everything from cell phone, home, credit card and retirement account terms of agreement to employment and nursing home contracts. Just by taking a job or buying a product or service, consumers and employees are forced to give up their right to take their case to court if they are harmed by a corporation.

Arb Study Points Out System's Lack of Checks and Balances

Opponents of the Arbitration Fairness Act strained to see a glass half full in a new study on consumer arbitrations administered by the American Arbitration Association, but they didn’t realize that the tonic contained a poison pill.

The study – released Wednesday by the Searle Center, a conservative Northwestern University think tank – found that consumers received an award in 53 percent of the cases they initiated and received about 52 percent of the amount they sought in those cases. Businesses received an award in 84 percent of cases they brought and won 93 percent of what they ask for in those cases. This means that businesses got roughly 78 percent of what they sought compared to 28 percent for consumers.

Time to Blow the Whistle on Washington

Beginning on Sunday, an important assembly will convene to urge Congress to take the next step forward in strengthening accountability and transparency in government. The 2009 National Whistleblower Assembly is a gathering of whistleblowers and advocates organized by the Make It Safe Coalition. Over the course of four days, the assembly will lobby members of Congress, share stories, and educate the public. The event takes place in Washington D.C. from Sunday, March 8th - Wednesday, March 11th. 

As we've said over and over again, whistleblowers ensure real accountability, protect our tax dollars in the stimulus and other government spending, and are indispensable to a healthy, non-corrupt government. It's a disgrace that speaking out about government fraud, misconduct, waste and corruption is still such a risky endeavor, especially in these times, after countless studies have verified that whistleblowers are the most effective weapon against fraud.

If you can, please join us in D.C. and take a stand for government accountability and civil servant rights.  But if you can't make it to Washington, you can still help. You can join those making the rounds to members of Congress from home.

For more information about this event and whistleblower and taxpayer rights, visit us here.

Guns, Votes and DC

On last Thursday, the Senate finally approved at least one vote in Congress for the long-disenfranchised citizens of the nation's capital.  That was the hand that giveth . . .

The other hand promptly took away the common-sense gun control laws put into place by the locally-elected government of Washington, D.C.

Senator John Ensign (R-NV) offered an amendment to the D.C. House Voting Rights Act (61-37) that - if it should become law - could make D.C. one of the most free-wheeling-gun-toting places in the country.  It passed by 62-36.  That's right - more guns got one vote more than democracy.

First of all, what business does Congress have removing safeguards on selling and possessing firearms that meet the standards set by the highest court?  The D.C. City Council recently amended its local gun laws to comply with a Supreme Court ruling.  There is no sound reason for Congress to use extraordinary powers to preempt the democratic will of the people of D.C. - especially to make the city less safe. 

This gun measure is more than symbolism, or politics:  It's about public safety.  Specifically, the gun amendment would undermine federal anti-trafficking laws, repeal D.C.’s ban on military-style weapons, allow teenagers to possess semiautomatic assault rifles, and prohibit D.C. from passing laws that could “discourage” gun possession or use, by anyone - even children or felons.

And exactly what do gun laws have to do with the right to vote?  House leadership should not consider this or any other non-germane proposal with this civil and voting rights bill.  This is about righting a historic wrong and bringing more democracy to the so-called capital of the free world.  

It seems some in Congress think it is within their power to rule over the more than half a million people who live in the District of Columbia, even if those people have no democratic representation in Congress. This has got to change. It's time to tell members of the House that We the People are more powerful than the gun lobby who are pushing to have their interests imposed upon District residents. 

The House likely will vote on the bill on Wednesday, March 4.  Hopefully, they will walk our nation's democratic talk and do right by the people of D.C. by restoring their voting representation in the House AND rejecting any attempts to undermine their local democratic government.  If they succeed, members of the House will then need to negotiate with the Senate for the removal of the dangerous and unnecessary gun amendment.  President Obama should not have to consider whether to sign a divisive gun measure into law at the same time he acts to return voting rights to the citizens of the District.

If you live outside of Washington, D.C., please feel enfranchised to give your rep. a nudge to take a stand for more democracy now.  District residents can thank their non-voting delegate, Eleanor Holmes Norton, for tirelessly fighting for their rights.

Deputy AG-Nominee is "a big believer in whistleblowers"

This just in from Steven Aftergood's "Secrey News" blog with the Federation of American Scientists:

David W. Ogden, who has been nominated to be the next Deputy Attorney General, last week expressed strong support for government whistleblowers who help to expose corruption or malfeasance.

“I am a big believer in whistleblowers,” he said at his February 5 confirmation hearing before the Senate Judiciary Committee, “and in the need to make sure that people feel comfortable coming forward to make complaints.”

“I think what we need is a process that encourages whistleblowing in this administration and any other administration going forward. The business of making sure that we’re doing the right thing is an ongoing business,” Mr. Ogden said in response to a question from Sen. Sheldon Whitehouse.

He said he would work with the Attorney General “to fashion an appropriate process that encourages whistleblowers to raise issues that need to be addressed.”

Mr. Ogden also indicated a willingness to consider public disclosure of certain legal opinions of the Foreign Intelligence Surveillance Court.

Sen. Ron Wyden noted that “there are a lot of important rulings that go to the meaning of surveillance law, and I think that a lot of those kinds of judgments really could be redacted and declassified so that the country could be brought in in a more informed, a more complete way to these national-security debates.”

“I absolutely will commit to take a fresh look at this issue if I’m confirmed,” Mr. Ogden said.

FIS Court opinions that interpret surveillance law were one of several categories of “secret law” that were identified (pdf) in an April 30, 2008 Senate Judiciary Committee hearing on the subject.

Original post available here.

A personal letter from Bunny Greenhouse

Below is an important letter from Bunnatine Greenhouse who spoke up regarding the approval of a highly improper muti-billion dollar no bid contract to Halliburton for the reconstruction of Iraq. In retaliation for her courage she was removed from her position as the highest-ranking civilian contracting official at the Army Corps of Engineers.

My name is Bunny Greenhouse. I am the former Procurement Executive and highest-ranking Army Corps of Engineers civilian procurement official.

Today I am asking you to contact your Senators and Representatives to demand, in the strongest possible terms, that employees who disclose fraud in federal contracting are fully and properly protected in the 800 billion dollar stimulus package that Congress is currently debating. Here's why.

Shortly before the Iraq War commenced, I blew the whistle on improper contracting concerning the award of a multi-billion dollar no-bid, cost plus contract to Halliburton/KBR for the reconstruction of Iraq.

I was concerned that improper contracting activity would cost the taxpayers billions – and it did. The contract should not have been awarded. From my inside prospective, it was clear that the “fix was in” – the contract was going to be awarded to Halliburton no matter what I said or did.

Those who should have protested the contract remained silent. And their silence is not surprising because, as federal employees, we have no meaningful whistleblower protection! We can be fired for reporting fraud. We can lose our careers simply for doing our job and trying to protect the taxpayer.
I know this is true. It happened to me. The top brass demanded that I drop my protests. I refused. The top brass – many of whom had longstanding relations with government contractors – retaliated. They removed me from the Senior Executive Service and from anything having to do with contract oversight. When I went to federal court to demand protection the judge dismissed my case because as a federal employee I had no protection.

The bottom line is that without access to independent courts, real judges and juries, whistleblowers don’t stand a chance, and fairness and transparency will not see the light day.

Only Congress can fix this. The House of Representatives has already acted decisively by adding H.R. 985 to the stimulus bill, by a unanimous voice vote (now called H.R. 1, Section IV). President Obama's presidential campaign is on record as supporting the same whistleblower protections now found in House version of the stimulus bill.

So, the buck stops with the Senate. I urge you to contact your Senators and let them know that whistleblower protection is a critical part of the stimulus package for protection of the public trust. I urge you to contact your Representatives and tell them to hold strong -- and refuse to cut whistleblower protections from the bill. Federal employees, like me, who risk their careers to protect taxpayer money need to be protected.

Please act now! Pass this letter to your friends! Pass this letter to your co-workers! Pass this letter to your family! Send a letter to your Senator Now!

Billions of taxpayer dollars are at stake and it is up to the Senate to do the right thing.

Very truly yours,

Bunnatine H. Greenhouse
Former Procurement Executive
Army Corps of Engineers

Post Editorial Misses Mark on Whistleblowers: Protections in Stimulus Bill Help Workers Hold Government Accountable

Today our whistleblower coalition responded to the Washington Post's outrageous editorial from February 2, 2009.

A Joint Statement from a Coalition of Public Interest Groups

Monday’s Washington Post editorial, “Wrong Way to Protect,” did a disservice to its readers and the taxpayers when it opposed provisions in the economic stimulus bill that are designed to empower federal whistleblowers.

The editorial argues that the reform should be pursued through ordinary legislative channels rather than included in the stimulus, stating “This is not the way it’s supposed to work.”  This is exactly how it is supposed to work: Federal whistleblower protection legislation has had the benefit of hearings, and has been vetted in both chambers for several years.  This is not an extraneous measure, as the editorial suggests.  In both chambers, the original stimulus bills included whistleblower protections for state and local employees.  Members of the House had the good sense to recognize that the massive stimulus package creates an urgent need for federal employees, who are the taxpayers’ first line of defense against waste and fraud, to be given the same protections afforded state and local employees.  

Public Citizen Applauds House Vote to Encourage Federal Workers to Watchdog Spending of Taxpayer Dollars

We applaud the House of Representatives for answering the call on Wednesday for more meaningful transparency and accountability in the federal spending bill. House lawmakers passed a critical, bipartisan whistleblower protection amendment offered by Reps. Todd Platts (R-Pa.) and Chris Van Hollen (D-Md.) that will strengthen and expand protections for federal workers and contractors who report waste, fraud and abuse. We strongly urge the Senate to include the same commonsense whistleblower protections in its stimulus spending legislation.

This is a true victory for taxpayers who will be well-served if the final stimulus bill empowers hard-working federal employees and contractors who are uniquely positioned to observe and report if funds are mishandled. Workplace retaliation for reporting wrongdoing is real and ruthless. That’s why we have long fought for these critical protections. 

Update on Consumer and Civil Justice News

Happy holidays. With so many people on hiatus from last week until January 5, we thought a brief recap of some recent consumer and civil justice news might be useful:

• CBS News legal analyst Andrew Cohen responded to an absurd proposal from the U.S. Chamber of Commerce to President-elect Obama: the way to get the country back on track economically is to exempt companies from legal liability. Cohen analogized this selfish and short-sighted appeal to "child who kills his parents and then begs for mercy because he is an orphan." I like to think of it as a drunk driver who gets pulled over and then suggests to the police that the best way to resolve the situation would be to give him his keys back and look the other way while he drives himself home. Cohen recognizes this shameless argument for what it is: nonsense.
• Following the Fed 's recent enactment of new credit card rules, Sen. Robert Menendez (D-N.J.) called on lenders to comply with the reforms ASAP, rather than by the July 2010, date required by the rules. Other lawmakers have pledged to act quickly for more timely and comprehensive reforms. Last weekend, the New York Times editorialized that "promptly passing a credit card reform package" should be a priority for the next Congress.
• Class action lawsuits have been useful to consumers challenging baseless early termination fees (ETFs) in cellular telephone contracts. A recent story in the Times reported on efforts by Sen. Herb Kohl (D-Wis.) to investigate rate setting for cell phone text messaging plans. Perhaps unsurprisingly, those rates appear to be as baseless as ETFs. In another similarity to ETFs, consumers have begun filing class actions over text messaging rates.
• New America Foundation's blog has been following an old but infuriating story about a shady student lending practice in which lenders, like Ohio-based Key Bank, partner with unlicensed and unaccredited trade schools, disburse student loan money to the schools, and then refuse to discharge students of their debts when the schools go out of business. There is an FTC rule designed to protect students in these situations. One way that Key Bank has been evading the rule and other charges of unfairness over its practices is by including Binding Mandatory Arbitration clauses in the promissory notes. Key Bank insists that these are old cases, and it has ceased student loan operations (for the time being), but Key also received $2.5 billion from U.S. taxpayers (via the U.S. Treasury) as part of the bailout package.

Meanwhile, we must wait until after the New Year for word on a potential economic stimulus bill. Until this week, all signs seemed to indicate that authority for judges to modify mortgages would be included as part of the package. Now that congressional Republicans have indicated a willingness to drag their feet, the question appears to be not only whether the provision will be included in the stimulus, but also when the stimulus will be enacted.  Stay tuned.

Happy new year to all!

JAMA Editorializes Against Preemption in Wyeth Case

The Journal of the American Medical Association has joined the New England Journal of Medicine (published by the Massachusetts Medical Society) in urging the Supreme Court not to grant immunity to pharmaceutical companies for lapses in FDA-approved prescription labels. 

Whistleblower Trapped in Arbitration

An opinion issued earlier this month by the 2nd U.S. Circuit Court of Appeals shows how willing the courts can be to uphold binding mandatory arbitration clauses even if the courts find elements of them unfair.

The case involved Linda Guyden, who was hired by Aetna Inc. in January 2004 as the company's internal audit director. Guyden soon concluded that Aetna's internal audit department was ineffective, leaving the company susceptible to violating the Sarbanes-Oxley Act of 2002. After receiving unsatisfactory responses from various members of Aetna's senior management team, Guyden took her concerns to the firm's CEO in August 2004. A week later, the firm's chief financial officer gave Guyden a withering performance review that conflicted with a positive review he had given her only a month earlier. Along the way, Guyden won an intra-company battle to hire an outside auditor. In November, ten days before Guyden was slated to present the outside auditor's report to the firm's audit committee, she was fired.

Bad Court Ruling Could End Checks on Industry Funded 'Science'

Yesterday, the Washington Post noticed a disturbing trend that we have been following for a long time – the corporatization of scientific research ostensibly conducted by unbiased and trustworthy sources like, in this case, the Food and Drug Administration. Science has been twisted to serve corporate ends for decades – see the tobacco industry's "studies" showing that smoking is not dangerous. Most of the time, these justifications for unhealthy or dangerous products are given precisely the credibility they deserve – none. Perhaps realizing this, the new trend is to funnel money behind the scenes to get disreputable science published by reputable sources.

The Other Bad News for Consumers: Forced Arbitration

Due to the extensive coverage of the recent economic meltdown and the presidential race, it's been easy to miss some other news very relevant to consumers and corporate accountability.  Over at Tortdeform, they have some excellent posts about issues covered by the New York Times. 

First, Kia Franklin relayed the news that a recent Department of Health and Human Services study cited 94% of nursing homes for violations of federal health and safety laws.  This underscores the need for legislation banning forced arbitration, which nursing homes use to immunize themselves from the accountability when they violate the law or hurt their residents through negligent treatment or abuse.  (Follow up on the Times story from Tortdeform here.  Read more about the nursing home arbitration bill here.)

Next, Justinian Lane recaps a study by two law professors about the reluctance of companies to use arbitration when dealing with one another.  The professors cited in the story have been following this issue for some time now, and their results have consistently shown the hypocrisy of corporations that tout arbitration as a fair, efficient, less costly method of dispute resolution between companies and consumers, or employers and employees, but not between one another.

Protecting the rights of government whistleblowers

originally posted by Alyssa Wolice at CitizenVox

It’s no secret that the government officials you elect to serve the public’s best interests often abuse their power and cost you your hard-earned dollars. So, when the average government employee witnesses the acts of corruption that continue to plague our political system, shouldn’t they have the freedom to speak up and protect the public’s rights without facing the risk of retaliation?

Protect the Elderly from Forced Arbitration

by David Arkush and Christine Hines

Yesterday the Senate Judiciary Committee followed its counterpart in the House and approved an important arbitration bill to protect residents in nursing homes and assisted living facilities, the Fairness in Nursing Home Arbitration Act, S. 2838. The legislation, which a House committee approved in July, will make it easier to hold these facilities accountable for negligent or reckless acts that harm their residents. It prevents nursing homes from forcing residents to agree to arbitration before a dispute arises, allowing residents to turn to the courts in the event their nursing homes cause them serious injuries or death. Without this protection, nursing homes can force residents to take disputes to private arbitrators chosen by the nursing home itself. Guess who wins cases there?

Civil Justice Is Not About Special Interests

By Graham Steele & David Arkush

Far too often, the press covers civil justice issues purely as battles between special interests -- business versus "the trial lawyers" -- without much discussion on how the policies at issue would affect the public.  We weren't surprised when the Wall Street Journal presented our opposition to pre-dispute binding mandatory arbitration as kowtowing to the trial lawyers.  The editorial board of the WSJ is unabashedly conservative and pro-business, and a battle between powerful, well-resourced special interests provides a compelling narrative.  We were happy to set them straight.  But this story line persists with too many of the civil justice issues that we work on here at Public Citizen -- and in too many publications from which we expect better.

If you read the CL&P blog over the weekend, you saw an example in a brief excerpt of a recent NY Times Magazine article about the "tort war" between the United States Chamber of Commerce and the American Association for Justice (formerly the Association of Trial Lawyers of America).  The article mentions two important pieces of legislation, the Arbitration Fairness Act and the Sunshine in Litigation Act, but discusses them in the frame of the "tort reform battle" rather than reporting on their value to the American public generally:

At the federal level, trial lawyers are pushing for a law that would make it easier for consumers to sue instead of having to submit to binding arbitration, as many contracts — for credit cards, for example — now require. The trial lawyers are also trying to make it harder for defendants to keep legal proceedings secret.

These proposed laws might benefit trial lawyers, but much more important is that they will benefit the public. That's why we're working to pass them:

Business Week Looks Inside Arbitration Firm, Finds Shady Practices

By Graham Steele

In case you missed it, Business Week published an excellent story last week that highlights the abuses of pre-dispute binding mandatory consumer arbitration.  As you probably know by now, many consumer service contracts (credit cards, cell phones, cable/internet/telephone service, car purchase agreements, computer purchase agreements, etc., etc.) force individuals to resolve disputes in arbitration instead of court. Despite its innocuous sounding name, arbitration is a legally binding process. Most egregiously, companies that force their customers into arbitration actually hire the very arbitration firms that rule on disputes.

If you're an American consumer, chances are that you could be required to submit to arbitration before the NAF: their list of corporate clients includes Bank of America, Citibank, Discover, General Electric, JPMorgan Chase, Lowe's, Sears, Circuit City, Sallie Mae, and Toyota Motor Credit.  The article describes, in vivid detail, NAF's private, for-profit dispute resolution enterprise designed to secure repeat business for them and the highest possible judgment for their corporate clients.  Arbitration companies are essentially operated like judgment mills: consumers are rarely given notice and a chance to participate, most arbitrator decisions are made in a few minutes, and arbitrators are pressured to aware fees that would not be authorized in civil court. 

Some of the article's key findings:

• NAF actively markets itself to large companies as providing a “marked increase in recovery rates over existing collection methods.” The article also explains: "current and former NAF arbitrators say they make decisions in haste—sometimes in just a few minutes—based on scant information and rarely with debtor participation."
• NAF educates its corporate clients on ways to manipulate procedural rules to their advantage, even explaining how corporations can bring poorly documented cases with assurance that they won’t lose: either the consumer will not respond and the company will win by default, or, in the event that the consumer disputes, the company can ask for a stay or a dismissal. (If the case is dismissed, the company can always re-file later.)
• Companies can also exploit rules and basic institutional pressures on arbitrators to ensure that they get a sympathetic “judge.”  They can drop and re-file a case if they get an arbitrator that they don't like, or simply demand that an arbitrator that they don't like be removed from all of their cases.
• As part of an ongoing business strategy, NAF colludes with law firms specializing in debt collection to promote the use of arbitration to the law firms' corporate      clients.  This is akin to a judge coordinating with lawyers to persuade the lawyers' clients to bring suits to the judge – with the judge getting paid more when he hears more cases and the lawyers getting paid more when they win.

Whistleblowers: Best Defense Against Corruption

By Angela Canterbury. Originally published on The Hill's Congress Blog.

For years now, corrupt interests have co-opted our government for political gain and private profiteering. Our best line of defense when the law is ignored and regulation fails are the informed insiders who believe so strongly in the importance of accountability and saving taxpayer dollars - and often saving lives - that they are willing to risk their careers and safety to expose government wrongdoing.

It is a national disgrace that speaking out about government fraud, misconduct, waste and corruption is still such a risky endeavor. More often than not, whistleblowers suffer from some form of serious retaliation, including threats, demotion or outright firing for exposing wrongful conduct. Conscientious civil servants deserve strong statutory protections, not risk and intimidation. Yet many end up sacrificing because the 1989 Whistleblower Protection Act has been interpreted and enforced in a way that weakens the protections Congress intended - protections that government whistleblowers desperately need.

It’s time to end the discrimination and retaliation - as well as the unmistakable and deeply chilling message it sends to all employees that they should keep quiet, or else. Congress should complete the marathon legislative effort to restore a credible Whistleblower Protection Act.

Heritage Foundation Opposes Consumer Information, Well-Working Markets

This piece from Heritage is really rich -- it argues against Senate legislation that would require the Consumer Product Safety Commission (CPSC) to host a public database of consumer complaints.

[Background: Product safety legislation has passed both the House and Senate and is being negotiated in an informal conference. The House provision on the database would require CPSC only to create a plan for the database, then report back to Congress. We and other consumer groups support the Senate bill over the House bill because CPSC should have the authority -- even the requirement -- to create the database as soon as possible, not just develop a plan to create it and then await further instruction. Making this information available to the public would help consumers protect themselves when the CPSC fails to act -- and the agency is notoriously slow to act, whether by informing the public about hazards or issuing new safety rules. With a public database, consumers could do their own research on products to see whether problems exist.]

There are several serious flaws in Heritage's argument, starting with its surprising conclusion. The piece criticizes the Senate's database provision by arguing that the CPSC should not host a database at all, but then it concludes by promoting the House provision, which would require the CPSC to "craft a detailed implementation plan" for a database -- presumably so the agency can implement it. If Heritage really believed its argument, we could expect it to oppose the database all together, not to support the crafting of an implementation plan.

Where Customers are Never Right

Over at Creditcards.com -- a website that helps people pick (you guessed it) credit cards -- there is an article warning consumers about binding mandatory arbitration.  They highlight the dangers of forced arbitration and its differences from the civil justice system. 

One of the most alarming is that unlike court judges, arbitrators do not have to obey the rule of law.  They can ignore key evidence and flout the law because their decisions are usually secret (unless both parties agree to make them public) and are rarely appealable to a real court.  It’s no surprise then that Public Citizen’s report, The Arbitration Trap, uncovered that consumers lose 94 percent of the time in arbitrations in California.

Want to avoid forced arbitration?  Your only choices are to get an AARP card (if you happen to be a senior citizen) or join one of the credit unions that doesn't require it. 

If you get trapped in arbitration, read their tips to help keep things fair.

Nursing Home Arbitration

The Wall Street Journal recently published ($) an excellent front-page article describing one of the more egregious incarnations of binding mandatory arbitration – nursing home admission agreements. The money quote:

Nursing homes' average costs to settle cases have begun dropping, according to an industry study, even as claims of poor treatment are on the rise. The industry notes arbitration is slicing the number of patients winning big punitive judgments, the added penalties for severe negligence that can pump up the size of jury awards. Meanwhile consumer advocates, plaintiffs’ lawyers and even some arbitrators are decrying the practice.

The article goes on to describe the case of one Mary Hight, whose nursing home wouldn’t call an ambulance despite her being dehydrated and ill for days. Her daughter, Janice Cowart, resorted to pushing her uphill to a nearby hospital, where she died the next day. Even though the “arbitrator found the home was negligent both in allowing Ms. Hight to become dehydrated and failing to get her to an emergency room,” he only awarded $90,000. After legal fees from the arbitration, “We didn’t get one cent,” said John Estep, Janice Cowart’s brother.

Will the Pro-Civil Justice Candidates Please Stand Up?

Public Citizen is proud to join the Drum Major Institute and its coalition of organizations to support the “Pro Civil Justice Presidential Platform.”  Our goal is to get the attention of the presidential candidates and ask them to support our civil justice platform:

•Provide counsel for people who cannot afford it any important case;
•Ban forced arbitration in consumer contracts;
•Stop federal preemption of state consumer protection laws;
•Reduce secret settlements that keep health and safety information from the public;
•Ensure injured patients’ right to justice; and
•Effectively regulate the insurance industry to curb unfair practices.

These issues have been conspicuously absent from the candidates’ stump speeches.  We are not sure why, but we are going to find out.

WSJ's Recent Run on Forced Arbitration

by David Arkush and Taylor Lincoln

Wall Street Journal readers have heard a lot about binding mandatory arbitration recently. On Saturday, the newspaper’s editorial board used the Chamber of Commerce's biased survey on arbitration as justification for a fact-twisting polemic against the civil justice system. Today, the paper reported on a lawsuit against the National Arbitration Forum by the city of San Francisco, and readers weighed in with views on arbitration far more reasonable than those of the editors.

The Journal's editorial touted a recent Chamber survey claiming that 82% of voters would prefer to resolve a dispute with a company in arbitration in contrast to only 15% in litigation. Of course, survey participants were not informed that if a company forces you into arbitration, the company picks who resolves the dispute (what would Memphis think if Kansas got to pick the referees for tonight’s NCAA championship game?). Participants also weren’t told that these biased decisions are binding and almost always final -- meaning no appeals even if the decisions contain “silly factfinding” or are just plain “wacky.” (The are quotes from the Supreme Court and a federal appeals court!) Needless to say, the Journal’s opinion writers didn’t mention these flaws in the survey.

U. S. Chamber of Commerce Attacks Arbitration Fairness Act, Surprised?

The U.S. Chamber’s Institute for Legal Reform (ILR) yesterday launched a campaign to scuttle important consumer legislation pending in Congress.  The attack is aimed at the Arbitration Fairness Act (S. 1782/H.R. 3010) which is designed to protect consumers, employees and others from having binding arbitration imposed as the only means by which their disputes may be resolved.  For those of you who don’t know, the current problem with arbitration is its growing use by business to provide an edge in resolving disputes with their customers – and it’s appearing everywhere.  If you have a cell phone, credit card, bank account, auto loan, brokerage account, or a number of other goods services, chances are you’ve signed away your right to sue if things go wrong, without even knowing it!

This recent attack by the Chamber is in response to Public Citizen’s detailed report issued last fall which found that arbitrators employed by the National Arbitration Forum ruled against consumers in 94.7 percent of the 19,000 cases involving credit card holders.

Maryland Doctors Cry "Wolf" Again!

Once again Maryland doctors are raising the specter that patients will be denied access to medical care because doctors will be leaving Maryland as the cost of medical liability insurance increases.  The last time they used this scare tactic they convinced the Assembly to subsidize their premiums.  Now as those subsidies are set to expire they’re back with the same tired threats. Citing an emerging doctor shortage, doctors are urging Assembly members to enact “tort reforms” designed to slam the court house door on injured patients.

First, claims of an emerging doctor shortage are not borne out by the facts.  A recent report to The Governor’s Task Force on Health Care Access and Reimbursement indicated that data collected from the American Medical Association and the American Osteopathic Association and adjusted on a consistent basis shows that Maryland has the 4th highest patient care physician to population ratio in the U.S.

Unsealing Safety

It would have been easy to miss a recent New York Times article about a class-action lawsuit brought by disgruntled consumers against Microsoft for misleadingly marketing Microsoft Vista as being ready for use on certain computers for which it was clearly not ready.  This case became more interesting when discovery led Microsoft to disclose a series e-mails to the company from some customers, who also happened to be Microsoft executives, documenting their own troubles with Vista. (Microsoft’s own Vice President in charge of Windows product management complained that incompatibilities with Vista turned his laptop into “a $2,100 e-mail machine[.]”)

Civil litigation serves the public good in a variety of ways: it helps to create accountability to the public in business, and deters potential bad behavior.  This case is also a prime example of how lawsuits increase transparency.  In the absence of formal legislative hearings, litigation gives the public a unique opportunity to peek into the inner workings of corporations that make obfuscation a routine business practice with the help of restrictive secrecy policies and high-powered PR masters.  Without a class action suit against Microsoft, the public likely never would have learned of the 200 or so e-mail messages and internal reports documenting the Vista marketing strategy and cataloging the various difficulties that Microsoft's own executives had with the program.

What is the Hold Up with Product Safety?

The Consumer Product Safety Commission (CPSC) has been "working on" several rules to ensure product safety since at least 2004 (two since 1994!). These rules cover hazards that the agency itself blames for more than 900 deaths and more than $460 million in property damage every year.

These unfinished rules would help protect the public from:

• Bed rails, crib slats and baby bath seats that can suffocate, strangle or drown infants;
• Excessively flammable upholstery, bed linens and clothes that are among the leading causes of fire-related death in U.S. homes; and
• Cigarette lighters that, by the CPSC’s own analysis, fail to meet an industry-created voluntary standard at least 60 percent of the time.

Current law requires the agency to produce a final rule within 14 months of adopting an Advance Notice of Proposed Rulemaking (ANPR), a standard the agency has met only once since President Bush took office in 2001. Since 1990, the CPSC has completed 38 rules; just four of those were during the Bush administration.

Public Citizen’s new report, “Held Back: Incomplete Consumer Product Safety Commission Rules, Class of 2007,” details each of the rules that are in development and the reasons for the delays.

The CPSC is hamstrung by rulemaking procedures that are far more burdensome than those of most federal agencies. The rulemaking procedure established by Congress during the Reagan era requires the agency to provide double the usual amount of notice and opportunity for public comment, to explain repeatedly why it is not deferring to industry’s voluntary proposals, and to prove that any rule imposes as little burden as possible on industry.

Moreover, the agency’s procedures call for it to halt any rulemaking if industry creates a voluntary standard that appears likely to address the problem – even though such voluntary standards are unenforceable. Not surprisingly, industry often derails the CPSC’s efforts by strategically adopting voluntary rules.

These problems point to the need for Congress to reform the CPSC to fulfill its mission of protecting the public from hazardous products.  The Senate is considering a bill now that would give the CPSC some much-needed muscle.  You can write your senators here now.

Learn more and read the report at www.ToyingWithSafety.org.

Wall Street Investors Oppose Arbitration

Who doesn't like binding mandatory arbitration?  In addition to Comcast customers, KBR employees, car dealerships, and credit card holders, now public investors have voiced their opposition.

According to a recent survey by the Securities Industry Conference on Arbitration (SICA), participants in the NASD and NYSE arbitrations overwhelming felt they were unfair and were dissatisfied with the outcome.  The North American Securities Administrators Association offers a glimpse into why--

Currently, almost every broker-dealer includes in their customer agreements a predispute arbitration provision that forces public investors to submit all disputes that they may have with the firm and/or its associates to mandatory arbitration. Securities arbitration cases are heard by a three-member panel that includes one “non-public” or securities industry member, and two “public” members, who may have worked in the industry. Neither of the public arbitrators is required to be an investor advocate, even though the non-public arbitrator is required to be an industry representative.

It's no wonder that many investors could feel "trapped."

Some interesting numbers:

• Nearly half of the customers who expressed their views believed their arbitration panel was biased;
• 62 percent believed the arbitration process was unfair;
• 70 percent were dissatisfied with the outcome;
• 49 percent stated that the arbitration process was too expensive, and;
• A striking 75 percent of customers who compared their arbitration process to their civil litigation process indicated that arbitration was “very unfair” or “somewhat unfair” compared to court.

Download the full report.

Time to Put Safety First

Defective and dangerous products - from lead-painted toys to vacuum cleaners that catch fire - are being allowed onto our store shelves and into our homes.  The Consumer Product Safety Commission (CPSC) has failed to do its job and protect American consumers. 

Public Citizen just released a study showing that manufacturers often wait nearly three years before telling the CPSC about defective products that can kill people - and the agency typically takes another seven months to warn the public.  Some of these products include infant swings implicated in six deaths.

We need a strong, effective agency that can warn the public quickly about dangerous and defective products - and enforce the law against violators.  Under current law, the CPSC must ask permission from manufacturers to get vital safety information to the public.  What's more, the agency can't fine companies enough to make sure that they comply with the law.

The status quo is unacceptable - the CPSC should protect American consumers, not manufacturers!

The Senate commerce committee recently reported out the Consumer Product Safety Reform Act of 2007 (S. 2045), a bill that would give the CPSC much-needed muscle.  Now it goes to the full Senate for approval.  But, as happens all too often in Washington, D.C., bills that are carefully honed in committee become unrecognizable after amendments, concessions and the inevitable congressional horse trading take their toll on a proposal’s original intent.

Please urge your senators to ensure that the Senate bill passes intact - without weakening changes - for everyone's health and safety. 

New Study Shows Deadly Delays in Notification of Dangerous, Defective Products

Today we released a new report showing that despite a law requiring manufacturers to provide the Consumer Product Safety Commission (CPSC) with "immediate" notification of dangerous products, there are long delays before the public learns of dangerous, defective products.

The study, Hazardous Waits: CPSC Lets Crucial Time Pass Before Warning Public About Dangerous Products, covers 46 cases since 2002 in which the CPSC fined manufacturers for failing to adhere to the law requiring prompt reporting.  In addition, companies fined for tardy reporting took an average of 993 days - 2.7 years - between learning of a safety defect in their products and notifying the CPSC.

Perhaps as shocking, the CPSC then took an average of 209 additional days before disclosing the information to the public - even though each case concerned a product defect so dangerous that the item was recalled.  Under current law, the CPSC cannot disclose information about dangerous products without court approval or manufacturer agreement.

Among Public Citizen's findings:

• Graco waited 11 years to report its faulty infant swing, which was linked to reports of 181 falls that resulted in six deaths and nine serious injuries, including bone fractures and concussions. Graco made the report only after CPSC staff contacted the company.
• Hoover waited five years to report a vacuum cleaner with a faulty switch that had caused at least 96 fires. The CPSC then took another 279 days before negotiating a recall and informing the public.
• By February 2000, Polaris Industries had received 1,147 reports of faulty oil lines on its ATV, including 42 instances where the hot oil started a fire and 18 cases in which the oil seriously burned a rider.  But the company didn't report the defect to the CPSC for another year.

It's time to change the law to give the CPSC the authority to truly protect consumers.  Read the study and more about the problems with the CPSC.

Our Right to Know? Over Whose Dead Body?

Bush recently told Israeli reporters: “I'll be dead before the true history of the Bush administration is written.” 

Over his dead body?  Perhaps he meant that his "good works" would be told later, but as long as we let him keep his iron grip on presidential records, it could be several generations of Bushes before we know much of anything.

In 2001, Bush signed Executive Order 13233 to allow current and previous presidents to withhold documents and records without explanation INDEFINITELY.  What’s more, the order extends the presidents’ authority to control the records under to presidential family members, and vice presidents.

This unprecedented expansion of executive power flouts FOIA, precedent, and the principles of the Constitution.  The order, drafted by former Attorney General and close Bush friend Alberto Gonzales, eviscerates the post-Watergate Presidential Records Act, which made presidential records the property of the government, and then the public.  Our right to know should not be subject to the whims of the executive.

Legislation to repeal the order passed the House, but has been repeatedly blocked in the Senate.  First Senator Bunning was named as the holder. After feeling some pressure, Sen. Bunning removed his hold, and then friends of ours in the Senate attempted again to bring the bill up for a vote just before the holiday break.  It didn’t happen because, we are told, there is another objection from another unknown senator – no doubt carrying more water for the President. 

Sound familiar?

Meanwhile, the nation is consumed by one of the more thrilling primary elections in memory.  But where do the presidential candidates stand on the Presidential Records Act and presidential secrecy?  Senator Clinton recently was accused, perhaps unfairly, of preventing public access to Clinton Administration records.  Still, Senator Clinton is conspicuously not a cosponsor of the bill that would revoke the Bush Executive Order, the Presidential Records Act Amendments.

Why not? 

It’s been nearly two months since Philipe Reines, a spokesman for Clinton's Senate office, told the Tribune that "Senator Clinton believes that President Bush's 2001 Executive Order was wholly unnecessary and is inconsistent with the spirit of the Presidential Records Act, and therefore supports legislative efforts to reverse that order."

We’re still waiting for Clinton, and most of the other presidential candidates, to demonstrate that they believe the records belong to the people, not the President.  So far, only Senator Obama has put his name on the bill.

So while the world is enthralled with the presidential horse race, presidential records are hidden away and transparency transgressed again and again.  We can’t forget that much of our government remains in the hands of a few, until we take it back – again and again.

Freedom of Information, Sort Of

For more than 40 years, the Freedom of Information Act (FOIA) has been the pillar of the framework for transparent government – the primary advocacy instrument for deterring and exposing unchecked executive power.  However, since 9/11, FOIA has been hobbled by a doctrine of secrecy executed with administrative delays and ploys to keep government records “in the shadows.”

The OPEN Government Act, signed into law on December 31, is the first legislative update to FOIA since 1996 and a reassertion of checks and balances.  Now it will be easier for people to get information from their government.  The law provides for an online tracking system for requesters, a government-wide office to deal with disputes and concerns, penalties for offices that take too long to respond, a limit to agency “search” and “duplication” fees, and reimbursement of attorney fees in some situations where requesters must go to court.

But it wasn’t easy.

The FOIA improvement became law only after months of obstruction, foot-dragging and secret holds.  There is no doubt we had some solid champions in Rep. Waxman (D-CA), Sen. Leahy (D-VT), and Sen. Cornyn (R-TX) who kept the bill alive in shark-infested waters.  However, it might have never passed it at all without good, old-fashioned rabble rousing. 

After the bill passed the House in March 2007 by a huge margin, an anonymous senator placed a “secret hold” on it. Proponents decried the stubborn irony of preventing more access to our government records with secret holds and other back-door maneuvering by the White House.  Calls and emails poured into congressional offices, news articles and blog posts demanded the holder be revealed. 

We (the rabble) finally outed Senator Kyl as the secret holder.  Once exposed, Kyl surprisingly began to negotiate. Not surprisingly, Kyl was representing the terms of the White House.  Still, the bill began to move, and finally passed the Senate by unanimous consent. 

But it was not yet time for champagne.

It turned out that there were some issues with the bill that passed.  Some of us suspected foul play and poison pills . . . more noise and negotiations ensued.  Suddenly an imperfect, but passable fix bill emerged in December.  It was quickly pushed through at congressional warp speed with veto-proof support.  Perhaps everybody needed a win – to quiet the rabble.  In the end, even Bush could not refuse to sign the bill into law.

But this hard-fought battle is only a half-victory.

To be sure, the new law will tear down some of the bureaucratic blockade often used intentionally to prevent government operations from seeing the light of day.  Still, even with this victory, the rule-making authority of the executive branch makes it possible for the “War on Terror” to continue to be used to obviate the “informed consent of the governed."  The Ashcroft doctrine of withholding documents as long as some argument for a “sound legal basis” exists still stands.  This policy is a reversal of the Clinton-Reno instruction to officials to interpret FOIA in favor of disclosure – unless it was “reasonably foreseeable that disclosure could be harmful.”

We can expect the Bush-Cheney Administration will use every tactic available to keep their deeds under a cloak of secrecy.  Ready the rabble.

Halliburton Victim Twice Over

Today, Jamie Leigh Jones will appear before the House Judiciary Committee and tell how she was gang raped by her co-workers in Iraq while working for a Halliburton subsidiary called KBR. Afterwards, her assaulters confined her to a shipping container and warned that if she left Iraq for medical treatment, she’d be fired. That’s where she was found by agents sent by the U.S. embassy to rescue her — after her father called their congressman, Representative Ted Poe (R-Texas).

Now, Jamie Leigh Jones has been victimized twice over. Because KBR/Halliburton requires employees to sign contracts containing a binding mandatory arbitration (BMA) in the fine print, Jones is being denied her constitutional right to bring her perpetrators before a jury and be heard.

But Jamie Leigh Jones will be heard by Congress today — and then, lawmakers should waste no time in re-opening the doors of justice for Jones and the rest of us. It’s time to ban binding mandatory arbitration in employment and consumer contracts once and for all. There may be no other device being used today by Halliburton and other corporate giants that does more to systematically deny rights to workers and consumers.

Congress is beginning to focus.

Tort Costs Plummet in 2006, So Says Insurance Industry Consultant

U.S. tort costs plummeted in 2006, admits insurance industry consultant, Towers Perrin in its 2007 update issued yesterday.  Given exploding prices both in the grocery store and at the gas pump, this latest admission is a welcome change from other “news.”  TP reports the largest percentage decrease in the 56-year period contained in their study and the first decrease since 1997, a decrease of 5.5 percent in 2006 from 2005.

Having panned TP’s objectivity and methodology in past years, we are wary of their conclusions generally. As in the past, TP concedes here that its study examines only one side of the U.S. tort system; the costs. It makes no attempt to measure the benefits of tort for consumers and the public. They do (somewhat disingenuously) say “any connotation that an increase in tort costs is undesirable is unintended.” As noted in the past, TP includes as part of its cost estimate administrative expenses that are commonly characterized as very inefficient. Half of the costs they report are not costs in any real sense; they are merely transfer payments from wrongdoers to victims. 

Given that this study is one-sided, based on faulty methodology and has no apparent purpose, what is the point of the update? Perhaps its purpose can be found in the “future implications” section of the study where TP opines that tort costs will rise in 2007, 2008 and 2009. That “nugget” may provide just what the enemies of our legal system need to carry on their campaign to limit the rights of victims to recover damages when they are injured.  However, before industry moguls pin their hopes on that prediction they should remember that in 2006 TP predicted by 2007 tort costs would hit their highest levels since 1987.(1)  As we have said in the past, when it comes to TP, don’t believe most of what you read.

(1) 2006 Update on U.S. Tort Cost Trends, Towers Perrin, www.towersperrin.com/tillinghast

A Self-Inflicted "Crisis"

When NY’s Superintendent of Insurance announced a 14 percent across-the-board rate hike for medical liability insurance on July 1, 2007, doctors raised a hue and cry that the increase threatened a crisis in access to care because doctors could no longer afford to practice in New York and would be leaving the state or otherwise restricting their medical practices.  As in the past, doctors again blamed the premium increases on skyrocketing claims and lottery awards and demanded tort reforms that would cripple meritorious malpractice claims by the victims of medical negligence.

Today Public Citizen released a report that exposes these claims of the doctors as full blown, deliberate and obvious exaggeration: A Self-Inflicted “Crisis:” New York’s Medical Malpractice Troubles Caused by Flawed State Rate Setting and Raid on Rainy Day Fund. These same claims have been made by doctors during each of the three cycles of rising premiums that have occurred over the past thirty-plus years. Our report shows that rising malpractice premiums are not the result of any escalation in the frequency or severity in malpractice payments. The increase has nothing to do with patients, lawyers, judges, or our courts. It reflects an insurance problem.

Public Citizen’s analysis of the best available New York data demonstrates that the number of malpractice payments made on behalf of doctors in 2006 was at its lowest point since 1991. The total amount of malpractice payments for doctors, adjusted for inflation, was near or below fifteen year average in three of the past five years.

The amount of malpractice litigation in New York has not changed appreciably over the past eleven years. Thus, it is clear that the 14 percent increase in premiums did not reflect a sudden or dramatic change in either malpractice payments or litigation behavior.

A Lemon Court

Car dealers aren't doing much for their image these days - so, buyers beware.  Though it's not surprising, Mother Jones reports that car dealers are increasingly turning to a sneaky little device to relieve themselves of accountability when a deal goes bad: binding mandatory arbitration. If you were to try to sue them for say, selling you a lemon, you might find yourself tapped in arbitration.  Binding mandatory arbitration is a losing proposition for consumers, as we found in our recent report on how credit card companies use the predatory practice.

Ironically, these same car dealers fought tooth and nail just a few years ago to ban similar arbitration clauses in their contracts with car manufacturers:

The National Automobile Dealers Association wrote members of Congress in 2000 that if they weren't outlawed for the dealerships, mandatory binding arbitration clauses would allow "multinational motor vehicle manufacturers…to be able to unilaterally deny small business automobile and truck dealers rights under state laws that are designed to bring equity to the relationship between manufacturers and dealers." Congress agreed and passed legislation protecting the dealers.

The good news is that Congress is considering a ban on binding mandatory arbitration in consumer and employment disputes.  Please take a minute now to let your members of Congress know that you want to keep your right to take shady businesses to a public court with a judge or jury, instead of being trapped in a rigged, for-profit system where bad business practices flourish.

Party at Joan's

Earlier this month, the Wall Street Journal ran an editorial accusing us of being hand-puppets of their favorite boogie men-- the trial lawyers--because we oppose binding mandatory arbitration.  According to the Journal, our work to preserve the constitutional right to a trial by jury makes us all cabernet-swilling sell-outs. 

In her published letter to the editor, Public Citizen President Joan Claybrook sets them straight: 

"Party at Joan's"
November 17, 2007; Page A9

Your Nov. 7, broadside ("Party at Ralph's") on arbitration was baseless. We
oppose mandatory not voluntary arbitration requirements buried in the fine print of consumer contracts because they shred consumers' legal rights in favor of a secret, expensive, business-dominated system.

The consumer attorneys attending a reception at Public Citizen's office are
legal aid and private attorneys who toil in some of the least glamorous
corners of the law. They see firsthand the unfairness of this
industry-created system to avoid accountability. They work for consumers
harmed by home foreclosures, truth-in-lending violations, unfair debt
collection practices, predatory lending, auto dealer fraud and other
marketplace abuses.

To acquire a credit card, buy a home or car, open a bank account, use a cell
phone or get cable television, consumers usually must sign a contract
mandating arbitration to settle disputes. A mere signature effectively
eliminates their constitutional right to the public courts, extinguishes the
right to appeal, favors corporate repeat offenders whom arbitrators want to please and imposes substantial upfront costs.

License to Malpractice

Some of you might have heard about the doctor in New York, Dr. Harvey Finkelstein, who risked exposing over 600 people to HIV, hepatitis and other deadly diseases by reusing syringes. Among the many horrendous practices brought to light with this case, there are two that particularly highlight issues with the state’s health officials and medical board.

State health officials delayed the public release of the information to patients, which inexcusably delayed testing and possible treatment for those exposed. Then the state’s medical board incredibly found “no evidence of wrongdoing.”

Unfortunately, this is by no means a singular example of the worst medical malpractice offenders being ignored by the New York State Medical Board. Of the 127 doctors in New York who have made 10 or more malpractice payments since 1990, less than one-third have had reportable licensure actions taken against them.

It is clear that we need to fix the system that allows monstrous unaccountability like Finkelstein. As our Director, Laura MacCleery, put it, “The ‘I’ll scratch your back’ culture in medicine, in which doctors have claimed they are competent to police themselves, must end before more people are killed by criminal negligence.”

Stay tuned for Public Citizen’s upcoming in-depth analysis of the state of medical malpractice and insurance in New York.

Hey, it's better than indentured servitude

The lending industry gets a lot of flak for the way it conducts business.  Tactics such as targeting the working poor and racial minorities, imposing prepayment penalties, forcing pre-dispute arbitration clauses into contacts and setting other devious debt traps have received a lot of scrutiny.  Sure, no one likes to see a veteran and his family get kicked to the curb.  But you have to admit, it's a heck of a lot better than indentured servitude.

Kidding aside, Congress is taking action to help protect consumers.  Or is it? 

On Thursday, the House passed the Mortgage Reform and Anti-Predatory Lending Act of 2007 (H.R. 3915) in a 291-127 vote.  While it would do some good like requiring lenders to evaluate a borrower's ability to repay a loan, there are several provisions that consumer advocates and public interest groups are warning will make things worse for borrowers [PDF].

For example, a broad preemption provision would make current and stronger state laws on predatory lending obsolete.  Homeowners whose loans were sold off--usually to some Wall Street investment group--would be unable to fight back in foreclosure because there would be no meaningful federal protection from abuses by the new owners of their loans.

See if your Rep. voted for H.R. 3915.  If so, tell them they just took a big step backwards for consumers (House directory | 202-224-3121).

Consumers Win in Hearing on Capitol Hill

Written by Paul Bland

On October 25, 2007, the House Judiciary Committee’s Subcommittee on Commercial and Administrative Law held its second hearing on H.R. 3010, Rep. Hank Johnson's Arbitration Fairness Act. (This Subcommittee has jurisdiction over the bill.) H.R. 3010 would ban the use of pre-dispute binding mandatory arbitration in consumer, employment, franchise and medical contracts. (The first hearing was held on June 12th. I testified at it, and my testimony and a transcript of the hearing can be found on the Public Justice website.)

Three members of the Subcommittee attended the hearing. The first is Subcommittee Chairwoman Linda T. Sanchez. Rep. Sanchez has not yet co-sponsored the bill, but she spoke very sympathetically towards the situation of consumers and employees who have been treated poorly in mandatory arbitration systems. It also can’t be understated that Rep. Sanchez showed that she has put a lot of time into understanding the details of the issue, and she (along with her staff) have obviously put a great deal of work into interviewing and locating witnesses and giving both sides an opportunity to develop an extensive record. The second is Rep. Johnson, the sponsor of the bill, who is a courtly freshman representative from Georgia and a powerful orator. The third member was Ranking Subcommittee member Chris Cannon, who is a huge and uncritical fan of mandatory arbitration. In the course of carrying the water of the Chamber of Commerce on the issue, Rep. Cannon’s duties apparently include trying to craft personal attacks on anyone who comes forward with an individual story of having been abused by mandatory arbitration.

There were two panels. On the first panel:

Laura MacCleery, Director of Public Citizen's Congress Watch Division, who spoke about Public Citizen's report ("The Arbitration Trap: How Credit Card Companies Ensnare Consumers") summarizing more than 34,000 arbitrations handled by the National Arbitration Forum in California, and who also spoke in some detail about the problem of arbitration clauses that ban class actions. I have written in several forums that our law firm’s experience (interviewing hundreds of consumers, and dozens of consumer lawyers, strongly supports the conclusions of Public Citizen’s groundbreaking report). Laura spoke with fervor and energy, and was very articulate. Rep. Cannon tried to get her to admit that Public Citizen’s report is very limited in scope, but Laura pointed out (correctly) that it covered EVERY SINGLE case that the National Arbitration Forum reported handling in California over a period of several years.

Written by Paul Bland

On October 25, 2007, the House Judiciary Committee’s Subcommittee on Commercial and Administrative Law held its second hearing on H.R. 3010, Rep. Hank Johnson's Arbitration Fairness Act. (This Subcommittee has jurisdiction over the bill.) H.R. 3010 would ban the use of pre-dispute binding mandatory arbitration in consumer, employment, franchise and medical contracts. (The first hearing was held on June 12th. I testified at it, and my testimony and a transcript of the hearing can be found on the Public Justice website.)

Three members of the Subcommittee attended the hearing. The first is Subcommittee Chairwoman Linda T. Sanchez. Rep. Sanchez has not yet co-sponsored the bill, but she spoke very sympathetically towards the situation of consumers and employees who have been treated poorly in mandatory arbitration systems. It also can’t be understated that Rep. Sanchez showed that she has put a lot of time into understanding the details of the issue, and she (along with her staff) have obviously put a great deal of work into interviewing and locating witnesses and giving both sides an opportunity to develop an extensive record. The second is Rep. Johnson, the sponsor of the bill, who is a courtly freshman representative from Georgia and a powerful orator. The third member was Ranking Subcommittee member Chris Cannon, who is a huge and uncritical fan of mandatory arbitration. In the course of carrying the water of the Chamber of Commerce on the issue, Rep. Cannon’s duties apparently include trying to craft personal attacks on anyone who comes forward with an individual story of having been abused by mandatory arbitration.

There were two panels. On the first panel:

Laura MacCleery, Director of Public Citizen's Congress Watch Division, who spoke about Public Citizen's report ("The Arbitration Trap: How Credit Card Companies Ensnare Consumers") summarizing more than 34,000 arbitrations handled by the National Arbitration Forum in California, and who also spoke in some detail about the problem of arbitration clauses that ban class actions. I have written in several forums that our law firm’s experience (interviewing hundreds of consumers, and dozens of consumer lawyers, strongly supports the conclusions of Public Citizen’s groundbreaking report). Laura spoke with fervor and energy, and was very articulate. Rep. Cannon tried to get her to admit that Public Citizen’s report is very limited in scope, but Laura pointed out (correctly) that it covered EVERY SINGLE case that the National Arbitration Forum reported handling in California over a period of several years.

Credit Card Report on Marketplace and More

Last week we released our report on credit card companies forcing consumers into binding mandatory arbitration and interest has been very high.

Listen to a short piece on American Public Media's program, Marketplace, or you can read more on The Consumerist where Ben Popken blogged about what consumers are up against, as did Elizabeth Warren on TPM Cafe.  We are really pleased to have the word spread so that together we can end the predatory practice of mandatory arbitration. 

You can download The Arbitration Trap: How Credit Card Companies Ensnare Consumers here.  Also, learn what you can do to protect yourself and tell Congress to stand up for consumers. 

Beware the Arbitration Trap the Credit Card Companies Set for You

Earlier this summer, we sounded the alarm about binding mandatory arbitration (BMA) clauses in the fine print of cable bills sent out by Comcast.  Comcast was not the first company to pull this trick on consumers and, sadly, we’ve learned it is far from the last.

Today, Public Citizen releases a ground-breaking report, The Arbitration Trap: How Credit Card Companies Ensnare Consumers [pdf]. It shows how credit card companies rig their contracts with consumers, using binding mandatory arbitration to evade accountability, strip consumers of their rights and enforce their will. In fact, arbitrators rule for business between 94 and 97 percent of the time.

In a nutshell, BMA is private, corporate-dominated secret “court” that overwhelming rules against consumers. In this world, merely by signing your name on the dotted line, you have forfeited your right to a trial by jury. If someone steals your identity and runs out to buy a $4,000 plasma TV – and the credit card company wants YOU to pay for it – the dispute will automatically bypass the public civil justice system. Instead, it goes straight to an arbitrator who may have heard thousands of cases for that same credit card company. 

Intel Withdraws Class Action Ballot Initiative

A big win for the little guys! This week, Intel and its big-business allies at the California Chamber of Commerce and the misleadingly-named “Civil Justice Association of California” (CJAC) withdrew their ballot initiative aimed at rolling back Californians’ rights in court. The “time wasn't right,” said Intel spokesman Chuck Mulloy.

Why such an abrupt surrender? Perhaps it was the 30,000 faxes citizens organized by the Foundation for Taxpayer and Consumer Rights sent to Intel’s board of directors. Perhaps it was the sluggish fundraising. Or maybe the flurry of countermeasures filed in response, from a competing initiative enshrining the right to the class action to the “No Say, No Pay” act that would force top executives to disclose how much they pay themselves and allow their shareholders to dock their pay. Terrifying! Intel might also have been smarting from the initiative’s tendency to remind consumers of its egregiously racist advertisement. Or maybe it was simply the fact that this unpopular measure had no chance of passing.

Whatever the cause, we congratulate the Foundation for Taxpayer and Consumer Rights for its success, and Californians for keeping their constitutional rights!

Enough is Enough – Kyl Should Stop Blocking OPEN Government Act

Today, Public Citizen sent a letter to Senator Jon Kyl (R.-Ariz.), asking him to allow an important bill to increase access to government information to come to a vote in the Senate.

We’re not the only ones asking for a break. Last week, Sen. Dick Durbin (D.-Ill.), the Democratic whip, sought unanimous consent to bring up the OPEN Government Act again, which would critically improve the Freedom of Information Act (FOIA). The GOP again blocked consideration of the bill for the now-unmasked “Senator Anonymous ” – Senator Kyl (R.-Ariz.). At yesterday’s opening of the Senate session, Senate Majority Leader Harry Reid (D.-Nev.), asked for an end to objections over bringing the uncontroversial, bipartisan bill to the floor. Kyl did not back down.   

It’s time for Senator Kyl to stop obstructing a vote for FOIA and allow the OPEN Government Act to go to the floor. The bill would strengthen the law that provides access to government documents for the press and citizens. Senator Kyl is quibbling over a few parts of the bill, and Senators Leahy (D.-Vt.) and Cornyn (R.-Tx.) have tried to accommodate his concerns.

But there is a limit to how much compromise is deserved here. 

The current bill encourages the timely settlement of cases where the government lacks a reasonable basis to withhold information. The incentive it provides would strengthen FOIA, decrease the cost of litigation and benefit taxpayers. People of modest means should not be penalized when it comes to using FOIA.  In fact, the majority of FOIA requesters are individuals and businesses – taxpayers that deserve real and timely information about the actions of their government.

Senator Kyl should step aside now, and allow the Senate to vote on the OPEN Government Act.      

Comcast Getting Push Back

Last month, when we warned that consumer rights were being threatened by a little pamphlet quietly slipped into cable bills by Comcast, there was an outcry from Comcast customers. Now elected officials in Maryland are taking notice.

Today, the Washington Post reports that the Montgomery County Executive and at least one member of the state legislature are taking extraordinary steps to alert residents about the anti-consumer practice of binding mandatory arbitration:

"Comcast's unilateral action to change the subscriber agreement, with an artificial 30-day deadline, is simply anti-consumer," council member Duchy Trachtenberg (D-At Large), who chairs a management and fiscal policy committee, said in the release.

Jane E. Lawton (D), a state delegate who also serves as county cable administrator, called the policy change "one-sided."

County Executive Isiah Leggett said: "Vendors should not change the terms of service without first receiving the consent of the consumer, and the fact that Comcast has not done this is disturbing."

Comcast isn’t telling where else they are forcing consumers with disputes into binding arbitration without any recourse in the civil justice system.  We have heard reports of the notice being found in cable bills in Florida, D.C., Virginia, Delaware, and Massachusetts. However, Comcast operates in 39 states and the District of Columbia, so chances are other states are affected.      

What can you do? We have opt-out instructions and other ideas on our former blog post.  But you also might contact your county and state representatives and complain loudly about Comcast’s bad business practices.

Taking a Bite out of the Great Medical Malpractice Hoax

Laura MacCleery, Director of Public Citizen's Congress Watch division, debated Jim Copland of the Manhattan Institute for Policy Research on WNYC's "The Brian Lehrer Show."

The segment gets heated as they debate New York State's 14% increase in malpractice insurance and the civil justice system in preserving victim's rights. 

The show asks: what can be done to improve patient safety and hold the most dangerous doctors accountable? Is there really a medical malpractice crisis?

Click below to hear Laura debunk the myths and expose the lies told about doctors, patients and the insurance industry.

Protect Your Rights – Opt Out of the "Comcastic" Fine Print

This month, Comcast consumers in Maryland had a little pamphlet called "Arbitration Notice" quietly slipped into their cable bill.

All the legalese can be boiled down to one sentence: "You have 30 days to opt-out of being automatically enrolled in our arbitration clause, thereby forfeiting your right to settle disputes with Comcast in a court of law in a trial by judge or jury."

This unfair and stealthy move by Comcast strips consumers of their rights. Access to justice in the courts is a longstanding cornerstone of corporate accountability.  Arbitration, on the other hand, is a private system stacked in favor of corporations – and an arbitrator’s decision, even if it’s wrong or absurd, cannot be appealed on the merits. 

Comcast is not just bullying consumers in Maryland, whose deadline to opt-out is July 15, 2007.  They are forcing consumers elsewhere into giving up their rights.  The mandatory binding arbitration is now a fixture in the Comcast “Terms of Use”.

Here’s how to stand up to Comcast and its corporate bullying:

• Opt Out: Go to Comcast's online opt-out form and preserve your rights (Don't forget to check the opt-out box!).  This will NOT affect your service.
• Make Noise: Call up Comcast – 1-800-COMCAST (1-800-266-2278) – and complain that they are automatically enrolling customers into their arbitration clause.  Demand to be allowed to opt-out of the binding mandatory arbitration clause!
• Tell a friend: email this post to friends and family.

You also can support the newly introduced legislation to ban the most egregious uses of binding mandatory arbitration clauses.  Be sure to tell us about your experiences with Comcast in the comments section below.