Report From Counsel - Spring 2003

Report From Counsel

SPRING 2003 ISSUE

THE TRUTH ABOUT MEDICAL MALPRACTICE AND WHAT YOU SHOULD KNOW

By Stephen P. DeNittis

I am sure many of you have been hearing from the media the issue of medical malpractice reform. Many doctors are using scare tactics to frighten patients into believing that if medical malpractice reform is not obtained, they will stop practicing medicine in the State of New Jersey. With the uproar and media attention that the doctors and insurance companies have been obtaining, much inaccurate information has been given to the public to sway its opinion to support reforming the medical malpractice laws.

As recent as last week, I attended a gynecological visit with my wife in the anticipation of our newborn. While at the office, I noticed flyers that were being given to patients from our doctor's practice informing patients to contact their legislator to encourage malpractice tort reform to place limits on the amount of recovery a patient can receive if they are harmed by a doctor due to medical malpractice. I was enraged when seeing these flyers because they are a complete scare tactic to patients. Doctors in New Jersey have threatened to stop treating patients if laws are not changed. This flyer prompted me to write to you to inform you about the medical malpractice issues in New Jersey to persuade you not to agree to restrict your own legal rights.

Only one thing is clear in the midst of the medical malpractice tort problem, it is this: Injured patients do not cause medical malpractice. Yet, every proposed solution, every piece of legislation designed to decrease insurance premiums for doctors and hospitals will reduce the legal rights of all who have been harmed. Even worse, those who have been the most severely injured will bear the greatest burden of all because it is they who have the most at stake.

For more than two centuries, our civil justice system has worked to protect the injured and provide just compensation from wrongdoers. It is the best system the world has yet devised. The laws purpose is to ensure accountability for those found to be responsible for avoidable errors and/or negligence.

Our health care system is committing preventable medical errors at a rate that alarms both researchers and the federal government. But there is no hue and cry from doctors to remove from practice their colleagues who repeatedly harm patients and drain resources from the insurance companies.

Insurers make little effort to improve patient safety or institute precautions and protections in the health care industry to reduce risk. Such practices are common in the workplace, but absent in many doctors offices, hospitals and other medical facilities. Further, medical malpractice insurers have a history of poor business practices and bankruptcies as well as admissions of fraud, corruption and embezzlement.

The problems are serious and complex, but they are not due to patients injured in the process of medical treatment. In New Jersey, doctors, hospitals and medical malpractice insurers are lobbying your state legislators to attempt to put a cap on the amount of money you may be entitled to receive should a doctor commit medical malpractice on you or a loved one. Doctors, hospitals and medical malpractice insurers are trying to limit the amount a person may recover for pain and suffering in the amount of $250,000. This $250,000 cap would be the most a person would be entitled to receive regardless of whether they die, are left in a permanently vegetative state, lose a limb, receive tremendous burns, lose their eyesight, sustain any type of catastrophic injury, etc. This $250,000 cap on pain and suffering damages would also limit the amount of damages a person may receive regardless of how old they are. The person could be young and have to live with deformities or sever injuries that are permanent in nature for the rest of their lives and, yet, only still be entitled to $250,000.

The following are some important facts which doctors, hospitals and medical malpractice insurers have failed to tell you:

* The number of medical malpractice lawsuits in New Jersey have already dropped 25% between 1994 and 2001. This decline in malpractice cases has been confirmed by the two largest medical malpractice insurance companies in New Jersey. The number of malpractice lawsuits is going down, not up. In 1994, legislation was passed in New Jersey requiring the claimant to obtain an affidavit of merit from a doctor substantiating his or her claim of malpractice within sixty days of filing their lawsuit against the defendant doctor. This requirement eliminates frivolous lawsuits and prevents a lawsuit from being filed unless another doctor is willing to testify that there is malpractice that has occurred;

* Princeton Insurance is the state's largest malpractice insurer. Their profits increased 22% from 1990 to 2000, announcing nearly $30,000,000 of net profit in its annual report. The insurance industry has been informing the public that there is a crisis and they are losing money and are, thus, charging the doctors an increase in their premiums. The insurance industry is asking people to give up their rights due to them losing money which is allegedly being pushed onto the doctors. This simply is not true;

* The medical malpractice industry is seeking to put caps on the limits patients may receive who are subjected to medical malpractice as a basis to lower insurance premiums for doctors. However, in 1975, California changed its laws to restrict the rights of injured patients and limit the damages that can be recovered for losses. The American Medical Association, which monitors medical malpractice costs in all the states in the country, says California's rates are 20% higher than the national average. Another nationwide study demonstrated that states which passed caps on damages pay about 11% higher malpractice rates than states that do not impose limits. Limiting the rights of victims will not solve this problem. There is no guarantee that, should laws be enacted to restrict the rights of injured patients, premiums would actually go down for doctors;

* According to the statistics from the federal government, medical errors cause nearly 100,000 deaths each year. The rankings vary from year to year, but whether they are the fifth, or the fourth, or the third leading cause of death, medical errors have been far too frequent. Preventing medical errors is the best way to bring down malpractice insurance costs.

I urge you to contact your state representative or legislator and explain that you do not wish to have your legal rights limited. Rather, you wish to have other means to regulate the insurance companies from gouging doctors the insurance premiums that they are charging. You need to take a stand because laws may be changed in New Jersey that severely affect your rights. You or a loved one may be subject to medical malpractice one day and, even though this issue may not seem important now, it may be very important to you some time in the future. I hope this is never the case, but if it is, now is the time for you to take a stand and prevent laws from being passed that restrict your rights.

TYCO AND ADT SECURITY SERVICES ARE TARGETS OF SUIT

A former dealer for ADT Security Systems, Inc. filed suit against the security-alarm firm and its parent Tyco International, Inc., alleging they breached contract terms when ADT abruptly scaled back its dealer network and overhauled dealership contract terms this year.

The lawsuit, filed in Camden County Superior Court in New Jersey, seeks class-action status and unspecified damages from Tyco, a conglomerate based in Bermuda. The lawsuit alleges ADT dealers lost money when ADT, at Tyco's direction, severely limited the number of new home-alarm contracts it would purchase from them. The suit claims ADT didn't give dealers proper notice before changing the terms of its contract.

Gary Holmes, a Tyco spokesman, declined to comment on the lawsuit.

ADT's dealer program was the subject of a page-one article in The Wall Street Journal last month, which focused on sales tactics that resulted in high cancellation rates among alarm customers and raised questions about the way Tyco was accounting for the contracts it purchased from its network of dealers.

The lawsuit, filed by the law offices of Shabel & DeNittis on behalf of New Jersey dealer Spectracom, Inc., says the dealer cut-backs occurred shortly after ADT "instructed" dealers in June 2002 to sell more home-alarm contracts in the coming year.

A Wall Street Journal News Roundup

Tuesday, December 24, 2002

UTILITY ROOM LAWSUITS MAY CREATE PRECEDENT

Poor Ventilation Cited in Homes in Mount Laurel

Two class-action lawsuits filed by township residents, alleging a potentially dangerous utility room design in their cookie-cutter developments, could set a precedent for litigation in similar communities across the nation.

Thousands of condominiums, townhouses and single-family homes common to 55-and-older developments were built using the design in question--a 5-by-10-foot utility room that houses a gas furnace, hot water heater and clothes dryer. If there is not enough ventilation in the room, lint from the dryer could clog the furnace, causing it to emit deadly carbon monoxide gas.

If it is found not to be a builder's defect, the onus would be on the homeowner to take safety precautions.

"This isn't just Mount Laurel, these plans are used all over the state," said Township Manager Pat Halbe.

In May, the township joined a class-action suite against Orleans Homebuilders that alleges as many 7,000 homes built by the Bensalem, PA, company have this design, including the township's Essex Place, The Lakes, and The Courts at Brookfield.

That lawsuit is near resolution, said Steve DeNittis, one of the attorneys who filed the Orleans suit in December. Remedies are simple and fairly inexpensive--adding a vent to one wall or replacing solid doors with louvered ones to increase air flow.

But who would pay for those remedies has yet to be determined. The lawsuits claim the builder should pay for the remedies, supply carbon monoxide detectors and educate homeowners about the issue.

"We can't be unrealistic and say that every unit has to be rebuilt," DeNittis said. "If we go that route, that drives companies bankrupt and it doesn't do anybody any good. We're seeking a remedy that satisfies the issue."

Less than two weeks ago, DeNittis' firm filed another class-action suit over the utility room design, this time targeting J.S. Hovnanian & Sons. The township builder constructed the 965-unit Holiday Village East community, part of more than 4,500 homes the company built in the South Jersey region.

The number of homes with the utility room configuration in question has not yet been determined.

Peter Hovnanian maintains his company met all code requirements when the development was built and the homes were approved by township inspectors.

Several homeowners who brought the class-action suit disagree.

"We look at it as a defect and we want Hovnanian to rectify it," said Harry Schmoll, a former municipal judge and retired business law professor who moved to Holiday Village East six years ago. "We think this is a widespread problem throughout the community. Thank God no one has died."

Schmoll replaced his hot water heater this summer and failed to pass inspection by the township, according to the lawsuit. He was told the room was in violation of Building Officials and Code Administrators (BOCA) standards because it was too small and had inadequate ventilation to accommodate the three gas appliances, the suit states. Schmoll said he paid Home Depot $225 to install a louvered door and also purchased a carbon monoxide detector.

"I said, 'How come Mount Laurel approved it and why did they issue a certificate of occupancy?' And all the inspector said was that the building code was the same then as it is now," Schmoll said.

Township community development director Raymond Holshue examined utility rooms built by Hovnanian to determine if a code violation exists.

"I'm 100 percent neutral, right down the middle," Holshue said. "I'm not siding with one, I'm not siding with the other. My job is code compliance and my job is the safety of these residents, period."

Holshue, who has worked for the township for the past seven years, said the building code is about 20 years old and has not changed since the homes were built in the 1990s. "If we have any in Mount Laurel that are wrong, the entire county is wrong," Holshue said.

Halbe said township inspectors did not make their own air combustion calculations, used to determine if there is enough air for gas-fueled appliances to operate properly in the utility rooms at Holiday Village East. Housing plans were submitted under architectural seal, which certified that the design met building standards.

"(Township) inspectors do (calculations) now, even though they don't (legally) have to," Halbe said.

Said Mayor Peter McCaffrey: "That's how proactive we've become in the township just to protect the quality of life."

There have been no cases of carbon monoxide poisoning in Holiday Village East, he said.

"Everyone should have a carbon monoxide detector in their home," McCaffrey said. State law is changing to require builders to install carbon monoxide detectors in all new homes, he said.

In the meantime, residents are encouraged to follow simple home maintenance procedures to ensure adequate ventilation in the utility rooms.

"People don't routinely maintain their heaters," Halbe said. "Whether you have enough combustion air or not, if you don't maintain your heater, you will have carbon monoxide begin to build up."

Courier-Post

Sunday, November 17, 2002

CREDIT REPORTING AGENCY HELD ACCOUNTABLE FOR ERRORS