Overlawyered: Chronicling The High Cost Of Our Legal System

Posts Tagged ‘privacy’

FACTA receipts, restaurant coupons and “annihilating” damages

Entrepreneurial lawyers have launched a thriving industry of class actions demanding statutory damages of $100-$1000 per violation (times the number of customers) from businesses that continue printing too much credit card information on receipts despite a federal law requiring them to stop that practice, the Fair and Accurate Credit Transaction Act (FACTA). Kings Family Restaurants, a Western Pennsylvania chain, has agreed to distribute coupons, as well as very non-couponic attorney’s fees, in one such case (WSJ law blog, Apr. 25). “Coffee Bean Tea & Leaf, a Los Angeles-based coffee-shop chain, agreed to give customers free drinks and pay customer lawyers $110,000.” On the other hand, judges have not always gone along with demands for class certification: “Costco, the largest U.S. warehouse-club chain, might have to pay as much as $17 billion without having harmed anyone, U.S. District Judge A. Howard Matz said in January, refusing to certify a class action. That’s 15 times the Issaquah, Washington-based company’s 2007 profit.” (Cynthia Cotts, “Costco, Kinko’s Battle Trial Lawyers Over Credit-Card Receipts”, Bloomberg, Apr. 5). One tactic, used in suits against U-Haul and In-N-Out Burger, is to limit the scope of the class action to a few stores or locations, on the theory that a court that might not let a class action with “annihilating” damages go forward might yet approve one inflicting a nonfatal though large shark-bite. (Matthew Hirsch, “Plaintiffs Attorneys Think Globally, Act Locally in Financial Privacy Cases”, The Recorder, Aug. 27, 2007). Among the 300+ defendants in receipt suits is 1-800-FLOWERS, whose attorney David E. Block expresses outrage:

“In 22 years, I have never had a plaintiff sit across the table from me and say, ‘I have no damages. My identity hasn’t been stolen. I’m just bringing this lawsuit because I can,'” said Block of the Miami office of Jackson Lewis. “There’s something inherently wrong with a lawsuit where the plaintiff has no injury.”

(Tresa Baldas, “Landslide of Suits Over Data on Receipts”, National Law Journal, Apr. 7). “Receipts” needn’t actually be printed out in a shop or public place to trigger the act; those that flash on a customer’s home computer screen count too. (WSJ law blog, Apr. 8). Our earlier coverage: May 10 and Oct. 31, 2007, and Apr. 4 of this year.

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Privacy law and criminal investigations, cont’d

Following up on our discussion of HIPAA and the New York therapist murder, police have reported a break in the case, arresting a mentally disturbed man who has told investigators of having been committed to a mental institution 17 years ago by Dr. Kent Shimbach, the doctor who was injured in the rampage (and who shared offices with the therapist who was killed, Kathryn Faughey). Dr. Shinbach apparently has told investigators that he did not recognize the assailant and has no memory of any contact with him in the past.

Helen Smith (“Dr. Helen”) at Pajamas Media recalls the case of Vallejo, California psychologist Ira Polonsky, Ph.D., “who was shot and killed by what family members believe was a former patient. Unfortunately his death is still a mystery. Why? Blame the confidentiality laws in California:”

…police have been stymied in pursuing that line of investigation because of confidentiality laws protecting Polonsky’s patient records and appointment books.

Vallejo police detectives are in touch with a court-appointed attorney – a “special master” – who is working with the county court to see if there can be at least a limited review of protected records, but neither police nor court officials will comment on progress in that area.

And Hans Bader takes note of a recent Volokh thread discussing cases in which it seems Massachusetts privacy law was construed to prohibit the taping of ransom discussions with kidnappers (Commonwealth v. Jackson, 1976, mentioned in passing here) and a Florida court considered (but rejected!) the argument that a murderer’s privacy was infringed by his victim’s having tape recorded the murder.

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High cost of health privacy laws, cont’d

More HIPAA madness? On Wednesday, in a crime that cast a chill through the mental health community, a Manhattan therapist was brutally slaughtered in her office by a man whose actions seemed consistent with those of a current or former patient with a grudge. The assailant escaped on foot, and although his image had been captured on surveillance tape, police were nowhere near beginning to know where to start looking for him: “Because of privacy laws, police hadn’t been able to access patient records as of late yesterday, sources said.” (New York Post, Feb. 14)(via Bader). On medical privacy laws and the Virginia Tech rampage of Seung Hui Cho, see Jun. 16, 2007.

More: Commenter Supremacy Claus says not to blame HIPAA, which has an exemption for police reports.

Friday morning sequel: This morning’s New York Post sticks with the original story and fleshes out the HIPAA role somewhat:

The hunt for the savage beast who butchered an Upper East Side therapist has hit a roadblock – because detectives can’t access her patients’ medical records under federal privacy laws, The Post has learned.

Police believe the meat-cleaver-wielding psycho who killed Kathryn Faughey on Tuesday night inside her office on East 79th Street could be the doctor’s patient – and need access to her records to identify him.

But police sources said because of the Health Insurance Portability and Accountability Act, signed by President Bill Clinton in 1996, investigators are having a hard time gaining access to those records.

“A case like this gets complicated because of medical privacy protections,” a source close to the investigation told The Post yesterday.

The federal law states that doctors, hospitals and health-insurance companies must protect the privacy of patients – even in a murder investigation – and that only through the use of subpoenas can authorities hope to obtain such information.

Police sources said investigators have applied for a subpoena, but have yet to receive it. Even if the subpoena is issued, patients can sue to keep their records private. …

[D]etectives have tried to get around the law by tracking down patients through sign-in sheets at the building’s front desk and through surveillance cameras in the lobby, sources said.

(Murray Weiss, Jamie Schram and Clemente Lisi, “Vexed by ‘Slay File’ Madness”, New York Post, Feb. 15). My Times (U.K.) article on the problems posed by health privacy laws is here.

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Sears website privacy class action

The retailer quickly modified its managemyhome.com web site after it was pointed out that unauthorized users might get it to cough up records of homeowners’ past purchases. The law firm of KamberEdelson LLC quickly hopped on the case with a class action demanding millions, saying bad guys might use the information on past lawn mower purchases and the like to trick homeowners into divulging more serious financial data, though its complaint cited no instances where anything of the sort had actually happened. (“Sears Accused Of Violating Consumer Fraud Law”, Reuters/New York Times, Jan. 7; BenEdelman.org). Chicago lawyer/blogger David Fish isn’t impressed with the turn to legal action, asking, “Are you legally damaged because your nosy neighbor found out how much your washing machine cost?” (Jan. 10).

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Divorce prying: beyond private detectives

Another object lesson in how your rights to privacy stop when litigation begins:

High-tech surveillance tactics are now commonplace in divorce cases, changing the nature of matrimonial law practice.

Soon-to-be-divorced spouses routinely steal each other’s BlackBerries and install snooping software on each other’s computers. This not only enables them to read each other’s e-mail but to monitor, in 15-second increments, what a perhaps-erring marital partner is doing on the Internet, reports the New York Times. What they can’t find out, their divorce lawyers perhaps can by hiring even more technologically sophisticated private detectives.

“In just about every case now, to some extent, there is some electronic evidence,” says Gaetano Ferro, president of the American Academy of Matrimonial Lawyers. “It has completely changed our field.”

Amusingly or not, the one area where the law is ferocious in responding to adversaries’ invasions of each others’ privacy is that of clients’ communications with their lawyers — mustn’t infringe on the lawyer-client privilege, after all. (Martha Neil, “Divorce Practice Now a Surveillance War”, ABA Journal, Sept. 18).

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Yet more on privacy/disability laws and Seung Hui Cho

Perils of privacy laws, as discussed earlier here, here, here and here:

Fairfax County school officials determined that Seung Hui Cho suffered from an anxiety disorder so severe that they put him in special education and devised a plan to help, according to sources familiar with his history, but Virginia Tech was never told of the problem.

The disorder made Cho unable to speak in social settings and was deemed an emotional disability, the sources said. When he stopped getting the help that Fairfax was providing, Cho became even more isolated and suffered severe ridicule during his four years at Virginia Tech, experts suggested. In his senior year, Cho killed 32 students and faculty members and himself in the deadliest shooting by an individual in U.S. history….

Professors and school administrators at Virginia Tech could not have known of Cho’s emotional disability — Fairfax officials were forbidden from telling them. Federal privacy and disability laws prohibit high schools from sharing with colleges private information such as a student’s special education coding or disability, according to high school and college guidance and admissions officials. Those laws also prohibit colleges from asking for such information.

The only way Virginia Tech officials would have known about Cho’s anxiety and selective mutism would have been if Cho or his parents told them about it and asked for accommodations to help him, as he had received in Fairfax….

Although the only way college officials could have known about Cho’s problem would have been from Cho, experts said that asking for help is an almost impossible task for someone with selective mutism.

(Brigid Schulte and Tim Craig, “Unknown to Va. Tech, Cho Had a Disorder”, Washington Post, Aug. 27). More: Hans Bader at CEI’s Open Market (Aug. 27).

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Privacy laws and Seung Hui Cho, cont’d

Better late than never:

Virginia Tech has provided some of Seung Hui Cho’s medical records to a panel investigating the April 16 massacre, after negotiating with family members to waive their privacy rights….

The records were released after weeks of frustration among the eight panel members over not being able to analyze Cho’s mental health in the years leading to the massacre, the worst mass shooting by an individual in U.S. history….

…panel officials said Thursday that they will continue to press for additional records, which also are protected under state and federal privacy laws.

(Tim Craig, “Panel Given Some Medical Files on Cho”, Washington Post, Jun. 15). And from a Thursday news report, also in the Post:

Authorities’ abilities to identify potentially dangerous mentally ill people are crippled across the nation by the same kinds of conflicts in privacy laws that prevented state officials from being able to intervene before Seung Hui Cho went on his rampage at Virginia Tech, according to a federal report commissioned after the Blacksburg shootings that was presented to President Bush yesterday.

Because school administrators, doctors and police officials rarely share information about students and others who have mental illnesses, troubled people don’t get the counseling they need, and authorities are often unable to prevent them from buying handguns, the report says.

(Chris L. Jenkins, “Confusion Over Laws Impedes Aid For Mentally Ill”, Washington Post, Jun. 14). My writings on the topic from April are here, here and here.

Vienna, Va. attorney Thomas J. Fadoul, Jr., who represents twenty victim families, has threatened to sue unless a family representative is appointed to the panel investigating the massacre so as to help “steer” its proceedings; Virginia governor Tim Kaine has replied that the panel was chosen so as not to include parties involved, and noted that the panel does not include any representative of Virginia Tech itself.

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Roundup – June 10, 2007

Here’s a Hollywood-themed edition of our irregularly-scheduled roundups:

  • When Sacha Baron Cohen accepted his Golden Globe award for Borat, he famously thanked all the Americans who hadn’t sued him “so far.” Subtract one person from that list; a New Yorker identifying himself as John Doe, who clever people quickly outed as businessman Jeffrey Lemerond, has now filed a lawsuit, claiming that he was humiliated by his appearance in the film. (Has anybody ever tried compiling a list of people who claimed they wanted privacy but filed lawsuits which exposed their secrets to a wide audience?) The Smoking Gun has the complaint. (Previous Borat suits: Dec. 2005, Nov. 9, 2006,Nov. 22, 2006)

  • A Beverly Hills store has settled its lawsuit against Us Weekly for refusing to give it free publicity. (Previously: Sep. 12, 2006, Sep. 22, 2006)
  • Carol Burnett’s lawsuit against the Family Guy gets tossed. (AP) On Point has details and the judge’s opinion. (Previously: Mar. 21.)

  • Two for the price of one: A couple of weeks ago, attorney Debra Opri sued her former client, Anna Nicole Smith-impregnator Larry Birkhead, for unpaid legal fees. Opri was last seen on Overlawyered sending exceedingly large bills to Birkhead, including thousands of dollars in cell phone charges.

    Now, Birkhead is suing Opri for conversion, fraud and malpractice. He claims that she took at least $650,000 of money owed to him for various appearance fees and has refused to return it; he also claims that Opri told him she was going to represent him for free in exchange for the publicity she’d receive, and then turned around and billed him hundreds of thousands of dollars. No, I’m sure this won’t turn into (yet another) media circus. (AP, TMZ.)

  • Judd Apatow, director of the movie Knocked Up, is being sued for copyright infringment by a Canadian author who claims he stole her book for his screenplay.

    A few months in, Eckler says she’s worn out by the litigation. “Here’s what it comes down to: 1) Being a writer, especially a Canadian one, without access to an unlimited bank account, sucks. 2) Copyright infringement is highly technical and difficult to prove. 3) Universal/Apatow know they have resources I do not have, and that every time they simply do not return my lawyer’s phone call, it costs me money.

    She also complains about her treatment at the hands of her first lawyer, who was referred to her by Apatow’s lawyer. (WSJ law blog; commentators at Volokh seem skeptical of the merits of her claims.)

  • Eleven year old boy, Dominic Kay, who directed a 15-minute movie starring Kevin Bacon, settles lawsuit against his neighbor, who helped finance the movie. “Kanter met Kay when her son played with him on a soccer team.” (L.A. Times)

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15 Minutes of Fame + Lawyers = Bankruptcy

For a brief period in 2004, Jessica Cutler was the hottest story in Washington. Cutler was the Senate aide who blogged at Washingtonienne about her sexual experiences with various Beltway insiders. After being exposed (pun intended), Cutler parlayed her notoriety into a six-figure book deal and Playboy photo shoot.

Unfortunately for Cutler, she had provided enough details in her blog for people to deduce the identity of some of her sexual partners. One of those, Robert Steinbuch, decided to sue her for $20 million for public disclosure of private facts (i.e., “invasion of privacy”) — thereby becoming only one of many recent examples of someone complaining about publicity… by filing a lawsuit that publicizes the acts he allegedly wants to keep secret.

In any case, Cutler began running into problems with her lawyers — namely, that they wanted her to pay them, and she had a different idea. We covered this in June 2006 (and see the Wonkette link in the comments). Now Cutler has filed for bankruptcy. Of course, we don’t know where all of her money went, but we know a good chunk of it went to her attorneys. Good luck collecting that $20 million, Mr. Steinbuch.

(As for collecting, Steinbuch had added some deep pockets to one of his lawsuits against Cutler — Hyperion Press (which published Cutler’s book), Disney (which owns Hyperion), HBO (which purchased the television rights to her story), and Time Warner (which owns HBO) — but that lawsuit, which Steinbuch filed in Arkansas, was dismissed in February on the grounds that it didn’t belong in Arkansas. Steinbuch has appealed, but his chances of success appear low, and his claims against HBO, Time Warner, and Disney are completely meritless anyway.)

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New Times column — the costs of health privacy

My new column in the Times (U.K.) is on the many costs of HIPAA, the federal law which even now prevents institutions from releasing the Virginia Tech psychopath’s health records (privacy rights extend after death) and played a notable role (along with the Buckley Amendment/FERPA) in restricting the chances for relevant actors to compare notes on his symptoms of madness before it was too late (Walter Olson, “Could less rigid privacy laws have prevented the Virginia tragedy?”, Apr. 20).

More: Dr. Wes has some additional HIPAA thoughts, as does Jeff Drummond at HIPAA Blog.

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