Law & Argument

Misuse of Your Office Computer Network--Guess Who is Liable?

2008-01-07T08:42:00.000-05:00

So, you're in your office and then suddenly a large contingent of Feds break in with a warrant for . . . your computer. This is not so far fetched. If one of your employees is doing something he or she shouldn't be (say, downloading child porn or spamming people with your servers for a side business), your company is on the hook. If you are suddenly confronted with this situation, don't panic. A good disaster plan can protect you from just about any unforeseen catastrophe, be it a direct meteor hit or criminals in your own lunch room. Here are some steps to follow to protect your business, both before and after you get served with the warrant.

1. Call Your Lawyer. Hopefully the firm you use has an attorney experienced in cybercrime. If not, the firm probably has people they can talk to. It's a good idea to talk to an attorney before the cops are at the door. You should also screen current and prospective employees. If they have criminal proclivities, chances are these tendencies have surfaced before. Check references and run actual background checks. If the federales are already in your lobby, don't say anything and call your lawyer fast.

2. Implement Written Computer Policies. A written policy is crucial to your ability to handle whatever comes up from civil suits to criminal charges to employee complaints about your computer policies. Any policy must include clear directives on Fair Use, document retention, privacy policies and e-mail. A comprehensive and well-drafted policy will also discourage employees from doing naughty things in the first place or being confused when they are sacked for violating the policy in the second place. Once you have a policy in place, do not deviate. Creating exceptions and looking the other way can cause worse problems. Here again, if you have a policy, have your attorney look it over. If you don't have one, have your attorney help you draft it. It is money well spent. As part of the policy, include a comprehensive document retention and archiving policy for all electronic documents, records and e-mail. Don't delete users from the system who have left the company until all their e-mails and documents are fully preserved. Only then can you purge them from the system.

3. Do Not Destroy the Evidence. As some of my prior posts have noted, missing electronic evidence is potentially more damaging and costly than the evidence would have been in the first place. The Federal Rules of Civil Procedure contain harsh penalties for failing to comply with discovery requests. Criminal rules are just as harsh plus they have the added incentive of jail time if you destroy evidence. If they've gotten a warrant, chances are your rotten employee is already under investigation and has been for some time. Your fingerprints on the missing files will implicate you.

4. Be Honest with the Heat. If you and your company get pulled into something like this, honesty is the best policy. Again, talk to your lawyer FIRST, but if he gives his blessing the best approach is to come clean. The cops (federal or otherwise) don't generally like to shoot you without good reason and they don't like to shut down legitimate businesses. They just want to catch the rats. They will generally work with you if you haven't tried to hide anything. Remember what happened to Martha Stewart. She was convicted not of shady stock deals, but of lying to the Feds. They really don't like that. Lie to them and they will tase you, then shoot you, and then throw you in jail just for fun. Remember, if you have nothing to hide, you probably have nothing to hide.

5. Have a Comprehensive Disaster Recovery Plan. If the Feds march in and haul off your network servers and all your workstations, that qualifies as a disaster. It's no different than if a meteor hits your server room or if a tsunami washes your hardware out to sea. Every business needs to have a comprehensive backup and recovery system in place. Backup all software on at least a weekly basis. This way, if you lose the servers (for whatever reason), you've only really lost a week of payroll, data, and e-mail.

And just as importantly, make sure your backup system is usable. Just because you are carefully backing up all your data to tape on a nightly basis and meticulously storing it off-site does not mean you are ready to set up shop across the street in the event of a disaster. Have you ever tried to recover data from a backup tape? It ain't easy. To do it, you need a server running the same backup software as the one that made the backup tape and an identical (working) tape drive to retrieve it. Plus you need the other software you use ever day (be it Outlook, MS Word, Excel, or your time and billing program) just to read the data after the catastrophe. Be absolutely certain that you can access the precious data you have taken such great pains to save. Remember all those post-apocolyptic movies where some poor guy is trying to get a 2,000 year-old DVD to play in a 2,000 year-old machine with no power while giant, mutant bugs or talking monkeys close in for the kill? Okay, that's you after a computer disaster where you can't access your data. Without a plan, the monkeys will win.

Schedule a drill with your IT people a couple of times a year to see if you can actually retrieve the data off-site. Absolutely do a drill every time you change your backup or other important software. Use a laptop or isolated workstation for the test. If it doesn't work, you have a problem. Get with your IT folks and fix it.

And lastly, make sure the non-guilty employees (or, in the alternative scenario, those employees who survive the meteor hit) have the ability to continue working, off-site if need be. The disaster plan should include access to a remote server where your data can be stored. You should also have web access of some kind so your employees can get to the data and telecommute for a while if need be.

Computers are incredibly powerful tools that can be used for good or for evil. Employees come in all flavors, too. A good, comprehensive contingency plan can protect your business from almost any disaster, be it a meteor hit or a criminal hiding in your midst.

A Holiday Wish

2007-12-21T11:27:00.000-05:00

At this time of year it is worth pausing for a moment and remembering how lucky we all are. Life comes at us so very fast. It is all too easy to become completely immersed in our daily grinds. As we struggle to stay above water between work, family obligations, school, health problems, politics, world events, and money matters, it is easy to forget the small things.

So, rather than write a pithy commentary on some legal item, I thought I would just ask you, dear reader, to take a moment and take in all that we have. Whatever the problems and challenges of these times, we are lucky beyond comprehending to here in this wonderful country, at this amazing time.

And therefore, no matter whether you celebrate Christmas, Chanakah, Kwanzaa, something else, or nothing at all, may you have a happy holiday season and a healthy, prosperous New Year. God bless us, everyone.

Kreiner Claims Another Victim--Michigan Court of Appeals Rear-Ends Another Critically Injured Plaintiff

2007-12-13T08:42:00.000-05:00

The Michigan Court of Appeals continues to use the hideous Kreiner v. Fisher decision to rob injured Michigan citizens of their right to recover for legitimate injuries sustained in auto accidents. The most recent atrocity is a decision called Jones v. Jones (Unpublished per curiam, No: 274627, Nov. 15, 2007). Dr. Evil would be proud.

Since the Kreiner decision came down from the Supreme Court in the summer of 2004, hundreds of plaintiffs have been denied any recovery from the negligent drivers who injured them. No less than 200 of those cases have been taken up on appeal and each time the injured plaintiff has lost. The plaintiffs have only prevailed in 30 such cases.

To illustrate the point, a closer look at Jones v. Jones may be instructive. Cynthia Jones was crossing the street one day when she was hit by a car. The car was being piloted by Sharon Jones (no relation, apparently). Sharon was negligent. The impact caused severe leg fractures that required a very serious open reduction surgery in which stabilizing plates and screws were surgically inserted. All this stabilizing hardware remain there in her leg to the present day and probably always will. (Woe to the poor traveler who finds himself behind Ms. Jones in the airport screening line). She required a wheelchair for an extended period, finally graduated to a walker, and endured months of in-home nursing attendant care to assist her with even the most basic daily needs. She also missed several months of work. She testified in her deposition that she still has pain and problems with standing and walking, even years after the accident.

Cynthia Jones brought suit against the negligent driver to recover for her pain and suffering. Unfortunately, the trial judge granted the defendant's motion for summary disposition and dismissed the case on the ground that, under the Kreiner decision, Cynthia Jones did not suffer a "serious impairment of an important body function." In other words, her injuries were not serious enough to meet the no-fault threshold requirement. She appealed. The Court of Appeals agreed that Cynthia Jones' injuries were not serious enough as a matter of law and affirmed the dismissal. There you have it. Case dismissed. End of story. Like the hundreds of plaintiffs just like her, unlucky enough to be injured through the negligence of others, Cynthia Jones faces the rest of her life with no compensation. The negligent driver gets off free, and Cynthia Jones is left to contemplate her broken body, scars, plates, syndesmotic screws, arthritis and pain. Victims of drunk or negligent drivers are being systematically victimized again by our courts. This is not fair. This is not justice. This is Michigan.

And lest we all forget, this is why we have insurance. To protect ourselves (and those we injure) from our mistakes. We are forced to have the insurance. But to what end? Have your rates gone down? The legislature has promised a fix for the ongoing scandal that is festering quietly, largely unnoticed in the Michigan courts. Let's hope it comes--and soon.

For an excellent discussion of the Kreiner dilemma, see Steven Gursten's article in the December 10, 2007 Lawyer's Weekly. The analysis is spot on.

Tattoos and Body Piercing Establishments to be Licensed

2007-12-11T13:49:00.000-05:00

Have you kept up with the number of tattoo and piercing reality shows on cable these days? It's astonishing. I've noticed one from Miami ("Miami Ink", Tuesdays at 10:00 p.m. on TLC), one from Los Angeles (L.A. Ink, Tuesday at 8:00 on TLC), and now there is another one coming from London (with the unpredictable title, "London Ink") that is supposed to start soon. Evidently it stars the guy who tattooed David Beckham (whoever he is). Blimey.

Michigan has its own tattoo establishments, too. But they aren't regulated by the state. It looks like Lansing is finally going to get around to regulating them. Amazingly, with the exception of a parental consent rule and a prohibition on tattooing drunk people, there are no laws regulating tattoo and piercing parlors in Michigan. This, despite that the fact that tattoos and piercings can carry with them a host of undesired consequences (hepatitis, methicillin-resistant Staphylococcus aureus--a.k.a. MRSA--staph, and other sundry infections to name just a few).

That could soon change if, as expected, Governor Jennifer Granholm signs legislation passed last week requiring body art shops to get a $500 state license. They must also meet safety and sanitary standards. As it stands, local governmental units decide whether to license and inspect body art shops or not. Wayne and Oakland counties in southeast Michigan are among the few that have their own regulations and inspectors to enforce them. But most other counties (up to two-thirds of Michigan Counties) don't have any such regulations. Starting in 2009, all county health departments would have to conduct annual inspections under the proposed law.

Tattoo artists and body piercers seem to be generally in favor of the move. "We are dealing with blood and body fluids. We're not just cutting hair," said Kris Lachance, who owns the tattoo and body piercing studio in East Lansing near Michigan State University.

Maybe we'll be seeing a "Detroit Ink" show soon, now that we're going legitimate.

How Free is Blog Speech?

2007-12-05T08:11:00.000-05:00

An age-old controversy has come to the Blogosphere, courtesy of a chemistry teacher in Wisconsin. Protected free speech vs. speech that incites violence is on the front page. Free speech proponents from all over are coming to the defense of James Buss, a teacher in the Oak Creek school district. Oak Creek is a suburb outside Madison. Recently Buss was arrested for leaving a provocative post on a conservative political website: www.bootsandsabers.com. The anonymous post praised the boys responsible for the Columbine High School shooting that took place in Colorado in 1999. Twelve students were killed and another 23 were wounded. Law and order types who are more sensitive to this kind of behavior are calling for Buss' head, urging that he be prosecuted or at least fired.

The post caused one teacher to call police in West Bend, Wisconsin where the blog's administrator lives. The administrator gave up Buss' IP address. Police tracked down Buss and arrested him. Now prosecutors are deciding whether to file charges or not.

The offending comment was made during a discussion over teacher salaries after some other commentators complained teachers were underworked and overpaid. Buss, who is a former president of the local teacher's union, apparently wrote that teacher salaries made him sick because they are lazy and work only five hours a day. He then went on to praise diabolical work of Eric Harris and Dylan Klebold, the two teen gunmen who killed 12 students and a teacher before committing suicide in the April 1999 attack at Columbine High School. Here is the text of the post left on November 16: "They knew how to deal with the overpaid teacher union thugs. One shot at a time!" he wrote, adding they should be remembered as heroes.

Washington County District Attorney Todd Martens is now considering whether to charge Buss with disorderly conduct and unlawful use of computerized communication systems.

Not everyone was alarmed by the post. Some observers said it was merely a sarcastic attempt to discredit critics of education spending. Buss was merely trying to mock the conservative view on teacher salaries, or so the theory goes. After his arrest, Buss spent an hour in the Washington County jail before he was released on $350 bail.

Police Capt. Toby Netko stands by the decision to arrest. He said the teacher who complained was disturbed by the reference to "one shot at a time." Other teachers agreed it was a threat.
Netko likened Buss' statement to saying "bomb" or "terrorist" in an airport. People are taken into custody all the time for that sort of behavior. If you don't believe it, try it sometime.

Now, for the most part all kinds of offensive, controversial, intolerant, hateful, ugly and stupid speech is protected by the First Amendment. In order for the speech not to be protected (i.e., for the speech to be illegal), it has to be intended to incite violence. The constitution protects most speech, even this comment if it was tongue-in-cheek or a bad joke.
Under the circumstances, it is unlikely that the prosecution will succeed. Though it was in very poor taste, it's a stretch to make this moronic statement into a call to violent action. However, it is likely that Buss could be disciplined by the school district (perhaps even fired) for his comments. The chemistry teacher has been placed on paid administrative leave while his school district considers what action to take.

It is hard to forget the images of teachers and students as they fled the horror that was unfolding inside Columbine High School. As dumb as this comment was, and as much poor judgment as it shows coming from a teacher, he shouldn't be prosecuted for it. However, public comments like this do have consequences. Words do have meaning. At the very least he owes an apology to the victims of the Columbine shooting and to the families of those who didn't survive.

Mind Your P's and Q's on MySpace--They're Watching You

2007-12-04T10:12:00.000-05:00

It seems that increasingly MySpace is the focus of unwanted publicity. Either young people are doing things on MySpace that get them into trouble, or others are using MySpace for illicit purposes. Don't put anything on MySpace you don't want the whole world to see. Okay, there are probably a few people out there who don't know what MySpace is. MySpace is one of a number of internet sights that offer an interactive, user-submitted network of friends, personal profiles, blogs, groups, photos, music and videos internationally. Started in 2003, the popularity of the sight exploded among high school and college students as a way to post pictures and meet people of similar interests. In 2005 MySpace, with 45 million users, was purchased by Rupert Murdoch's News Corporation for $580 million. In August 2006 the MySpace accounts passed the 100 million mark.

But MySpace is not all just good clean fun anymore. Just this week a prosecutor announced he would not be filing charges against a Missouri woman who used a fake MySpace account to pose as a young boy named "Josh" in order to contact, Megan Meier, a 13-year-old girl living down the street. Turns out this woman actually wanted to do a little spying on Megan, who was also a friend of the woman's daughter. The woman believed that Megan was spreading rumors about her own daughter and created the fake profile to find what was being said.

In September 2006 Megan and the fake Josh began exchanging messages and struck up a friendship. Then, after a month of on-line corresponding, "Josh" suddenly broke off the relationship and told Megan she was a bad person and cruel. Megan suffered from attention deficit disorder and depression. Distraught over the way her relationship with Josh ended, the next day Megan committed suicide by hanging herself in her bedroom.

Megan's family learned later that Josh never actually existed; he was created by members of a neighborhood family that included a former friend of Megan's. The girl's mother, Tina Meier, said she doesn't think anyone involved intended for her daughter to kill herself. "But when adults are involved and continue to screw with a 13-year- old, with or without mental problems, it is absolutely vile," she told the Suburban Journals of Greater St. Louis. The prosecutor cannot find any law on the books with which to charge the woman.

More recently, in Belleville, Michigan, four Belleville High School students were were expelled after photos of them with guns, drugs and piles of cash appeared on a MySpace website.
Van Buren Public Schools Superintendent Pete Lazaroff has said that the photos shown on the social networking Web site were taken after a limo picked the students up from a school dance. After the posted photos were discovered, the school district commenced expulsion procedures. The students were expelled following a closed hearing.

The students appealed the hearing, alleging that the way in which it was conducted violated their constitutional rights to due process. A Wayne County Circuit Court Judge agreed. Judge Cynthia Stephens criticized the district for failing to keep a record of the closed Nov. 3 disciplinary hearing that led to the expulsions. She reversed the expulsion and ordered the teens be readmitted to school, but also ruled the expulsion hearings could be reconvened if done according to constitutional standards. The school district did so and one of the expulsions was upheld. Oh, and the parents are suing for a million dollars per kid. Just a little parental responsibility sometimes would be nice.

In a similar episode, three students were expelled from a Kamiakin, Washington high school for posting photos of themselves on MySpace flashing gang signs. The district has a zero-tolerance policy for gangs. Read more: Kamiakin.

I suppose the lesson here is two fold. First, if your children are creating profiles on MySpace, FaceBook, YouTube or any of the other social networking websites, carefully monitor their activity. You never know who they could run into. These sites are prowled by undesirables of every stripe looking for victims. The nature of cyberspace makes it nearly impossible for the sight administrators to monitor their millions users. Cyber bullies can attack their victims almost at will with little fear of any consequences. Cyberspace has become an extension of the playground. Report unusual activity.

And second, if you or your children are posting to these sights, remember that you never know who could be seeing the post. School administrators and police do monitor these sites. Incriminating photos, statements or other information can be used in court and other proceedings. While a photos of a drunken college binge may seem funny now, a prospective employer probably won't think so. And many do check.

E-Discovery and the Legal Nightmare It Can Become--A Cautionary Tale

2007-11-28T08:34:00.000-05:00

Pretty much everyone in the legal and corporate worlds is aware that the legal landscape is changing and electronic discovery (e-discovery or EDD) is driving that change. E-discovery refers to any process by which electronic data is sought, located, secured, and searched with the intent of using it as evidence in a civil or criminal legal case. Even a small company can have millions of electronic and paper documents which somehow need to be located, copied, digitized, reviewed and, if necessary, produced during litigation. While existence of this data in a digital form can greatly speed review and searching, the penalty for a poorly designed system or poorly trained litigation team is extreme.

In the process of electronic discovery and recovery, data of all types can serve as evidence. This can include text, images, calendar files, databases, spreadsheets, audio files, animation, web sites, and computer programs. And as the lines between different technology hardware gets more and more blurry, potentially any electronic device can become a source of potential electronically stored data. The obvious sources are PC's, network servers and laptops. But now data is also stored on jump drives, portable hard drives, CD's, DVD's, Blue Ray Disks, memory chips, PDA's, and even i-Pods and cellular phones.

Most lawyers, even those who don't practice in Federal Court, are vaguely aware of recent amendments to the Federal Rules of Civil Procedure, including 16, 26, 33, 34 and 37. As a result of these amendments, the old "The dog ate my homework" excuse won't work anymore. There is no excuse for failing to maintain or produce electronic data and a party can be severely sanctioned for failing to comply. Many states are also bringing their own rules of civil procedure and into line with the Federal Rules--with similar penalties for violations.

The recent case in involving Qualcomm is instructive. Based in San Diego, Qualcomm licenses semiconductor technology and software to cell phone and DVD makers that makes the devices work. But there are other companies in this business. One competitor of Qualcomm's is Broadcom and for several years the two companies have been engaged in a pitched battle over who has infringed whose patents. One of the battle fronts is in the San Diego Federal District Court. Qualcomm was sued Broadcom over two of these patents covering technology that Broadcom had incorporated into its video players.

You can imagine the e-discovery issues involved when two giant chip/software/hardware makers with thousands of patents go after each other. Broadcom alleged as an affirmative defense that Qualcomm had waived its right to assert patent infringement, arguing that Broadcom's products were based on the JVT (Joint Video Team) international standards. Companies are entitled to base their products on such standards without fear of being sued for infringement. This is why your DVD movie can play in virtually any DVD player because they all use the same standards.

Broadcom claimed that Qualcomm waived its patent rights by participating in the standards process without disclosing that the resulting standard would violate existing patents held by Qualcomm. Broadcom's argument was essentially that Qualcomm engaged in a giant game of sandbag. On the one hand, Qualcomm helped to establish an industry standard that all companies could use, while at the same time knowing (without disclosing to the JVT committee) that it also held the patents on the very technology being incorporated into the standard. The secret ownership of these patents would, in turn, allow Qualcomm to sue any company using the standard for patent infringement. Smart if it works--REALLY dumb if you get caught. Qualcomm got caught.

The San Diego case went to trial and in January a jury ruled that the Qualcomm loses: it had violated Broadcom’s patents to the tune of $8.5 million. But even before the verdict, Qualcomm sustained a huge (and apparently unforseen) body blow as the trial was drawing to a close. One of Qualcomm's engineers revealed the existence of a mere 200,000 pages of e-mails that were not previously disclosed during discovery. Broadcom contended these e-mails should have been produced. Discovery is the pre-trial process where the parties take depositions and exchange documents. About 21 of the e-mails that should have been produced were the smoking gun kind that every lawyer dreams of. Qualcomm's lawyers said "Oops--Our bad" and sent letters of apology to the judge. They explained that they had used an improper "keyword search" during the review process that failed to kick out these e-mails so they remained buried in the millions of other documents being poured over and were never produced to Broadcom.

So all is forgiven, right? Qualcomm lost, afterall. End of story. Well, not exactly. That apology and dog-ate-the-emails fable wasn’t enough for the judge on the case, Rudi Brewster. On August 6 he issued a savage 54-page ruling accusing Qualcomm of not only of failing to turn over the more than 200,000 pages of relevant email and electronic documents during discovery, but of engaging in a long campaign of "constant stonewalling, concealment and repeated misrepresentations." He described it as "an organized program of litigation misconduct" and asked the federal magistrate in the case to consider sanctions against the outside attorney. Brewster ordered Qualcomm to pay Broadcom’s litigation costs, and voided two of its patents that had been incorporated into the JVT. David Rosmann, the vice-president of intellectual property litigation at victorious Broadcom, estimates that its fees will be around $10 million.

Bottom Line in this cautionary tale: Even assuming that Qualcomm's excuse for why it didn't produce the e-mails was legitimate (doubtful, but plausible even for parties who are trying hard to play by the rules), the penalties for that mistake are staggering. So, if you find yourself in a litigation situation, make sure your attorneys, IT department and any third-party e-discovery management company are all on the same page. If you don't have a spare $10 mil lying around, a mistake like the one in Qualcomm's case could put you out of business. Oh, and, not surprisingly, Qualcomm has new legal counsel now. So e-discovery mistakes can be just as deadly for the lawyers as for the actual parties.

I See Drunk People--What's Going on Out There?

2007-11-16T11:56:00.000-05:00

There seems to be a rash of weird drunk driving stories making the rounds these days. From the "There just ain't enough to do in Clio, Michigan" department, comes this item. On November 8 a man and his 13-year-old son were both arrested for drunk driving. A police officer noticed a truck that appeared to be stuck in the mud in a city park. When the officer approached the vehicle to investigate, he was somewhat surprised to find a drunken 13-year-old boy at the wheel.

Upon further investigation, the officer was even more surprised to find the lad's father sitting next to him in the passenger seat, also drunk. The man told police that he had turned over the driving duties to his son because he'd had too much to drink. The boy admitted that he was also too intoxicated to drive. Open containers of beer and liquor were found in the vehicle, said Clio Police Chief James McLellan.

The father, a 41-year-old Flint-area man, is facing several misdemeanor counts, including child endangerment, allowing an intoxicated person to drive his vehicle and allowing an unlicensed minor to drive, police said. The boy was charged in juvenile court with driving while intoxicated, among other things.

The pair were apparently trying to get home when they went into the park to turn around. The truck rolled off the pavement and became stuck in a muddy area. The kid will learn all that once he takes drivers education a few years from now.

And that isn't the only item. In another story, this one from Ypsilanti, Michigan, a man was arrested for drunk driving. Police told The Ann Arbor News that they first stopped the man after watching him run a red light. The Breathalyzer test registered a 0.11, three points over the Michigan legal limit of .08. Oh, and the man had his 12-year-old son in the car with him at the time.

Back at the station, the police told the boy to call his mother to come and pick him up. A short time later the mother arrived with her 9-year-old daughter in the car. The astute officers noted that she, too, appeared to have been drinking. A breath test was administered and she was found to be legally drunk after registering a 0.13. The police also arrested her. I can't tell from the story who finally drove the kids home. Maybe it was the drunken 13-year-old from the first story.

And in still another story, a man in Australia was arrested three times in a single day for driving while drunk (evidently a world record). The man was arrested the first time on Saturday evening driving along a road south of Perth, Australia, with a blood alcohol reading of 0.194. That is almost four times the legal limit in Australia. The man was caught an hour later driving along the same road and this time his car was confiscated by Police, to prevent future crimes, you see. But, later Sunday morning the man was arrested again in the same car. Police say that after his car was impounded, he broke into the Boddington Police Station in the early hours of Sunday morning, retrieved his car, and drove away. The third stop occurred several hours later. In addition to the third drunk driving charge, police added two more counts: trespass and driving without a licence. He was due to appear in court in Perth about 10 days ago.

While these are somewhat silly stories, drunk driving is no joking matter--no matter which side of the case you wind up on. If you or a family member are the victim of drunk driver, your life is forever changed. If you are the drunk driver and are caught, well, your life may change for the worse as well. A conviction under the new drunk driving laws will likely result in the suspension of your driving privileges, jail time, hefty fines, and Driver Responsibility fees payable to the Secretary of State for years after your conviction.

No matter on which side of the case you find yourself, do the smart thing and contact a skilled attorney.

Sad to See You Go--Judge Mary Beth Kelly Steps Down as Wayne County Chief Judge

2007-11-14T09:58:00.001-05:00

Judge Mary Beth Kelly has announced she will step down as Chief Judge of the Wayne County Circuit Court. I have had cases in front of Judge Kelly and found her to be prepared, decisive, reasoned and civil. Not always qualities found in judges, or attorneys in general, for that matter. She will be missed and so will her attempts to drain the swamp.

Judge Kelly was first appointed to the bench by Governor John Engler in 1999. She was appointed Chief Judge by the Supreme Court in 2001, 2003 and again in 2005. She angered many of her colleagues with her policies. She inherited a lot of headaches from her predecessors, including budget deficits ($35 million or so), a shortage of judges, and a nightmarish Friend of the Court office, among others.

Her most visionary and potentially beneficial proposal concerned privatizing the Friend of the Court. This would have saved money and resulted in more child support money being brought in for families. This proposal really angered the union that represents Friend of the Court staff and the County Commission, all of whom evidently feel that the Wayne County Friend of the Court is operating just fine the way it is. See our previous post "Fiend of the Court May go Private".

At about that same time, Judge Kelly moved to assist Circuit Judge Deborah Thomas with her docket troubles. It seems Judge Thomas had fallen behind and, acting in accordance with a recommendation of the court's docket review committee, Judge Kelly temporarily took away Thomas' authority to handle pretrial motions (a time consuming part of the job). Judge Thomas was outraged and resistant to the move. Supporters of Judge Thomas picketed the courthouse. Evidently they felt that--like the Friend of the Court Office--Judge Thomas' court was running just fine the way it was. As usual, the rights of the parties assigned to Judge Thomas to have their cases resolved as quickly and cheaply as possible come second.

In another controversial but very bold move, Judge Kelly raised the ire of her colleagues by assuming responsibility for reviewing all legal challenges to the racial composition of Wayne County Circuit Court juries. For reasons that don't seem to be fully understood, Wayne County juries often have fewer black members than county demographics would anticipate.

But Judge Kelly's position is consistent with the rulings of the Michigan Supreme Court. In 2005 the High Court ordered that race, gender, religion or nationality were considerations that could not be used in jury selection. This decision followed efforts by Wayne County judges — including Thomas — to impanel more racially balanced juries. The Michigan Judges Association and the Michigan Department of Civil Rights opposed the Supreme Court's rule change. A 2006 study by the National Center for State Courts, based in Williamsburg, Va., found African-Americans comprised about 26 percent of jury pools in Wayne County compared to 40 percent of the area's population.

The death blow to her tenure as chief judge really came several weeks ago when her esteemed colleagues on the bench voted overwhelmingly (just as they had done in 2005) to remove her, urging the Michigan Supreme Court to appoint Circuit Judge Robert Colombo, Jr. to replace Kelly. The long knives came out and Judge Kelly finally agreed, for the good of the court, to step down. It's a pity the other judges on the circuit didn't give more of her ideas a chance to bear fruit. For the record, Judge Columbo is also a fine judge and will likely make a very good chief judge.

Kelly counts among her accomplishments: adding judges to the court's Family Division--one thing she was actually allowed to accomplish. Happily, following her departure as Chief Judge Judge Kelly will still hear family law cases after January and, hopefully, continue to tackle the ongoing funding and other intractable problems at the Friend of the Court.

No good deed--or in this case good idea--goes unpunished. Judge Kelly had a lot of good ideas, which could only improve the Wayne County Circuit Court and its bloated, inefficient appendages. Her legacy would be much larger and more far reaching had she not been stymied in her efforts at reform by the keepers of the status quo, both on and off the bench. She has colleagues on the Wayne County bench, but few peers.

See this link for a more thorough article on Judge Kelly's tenure as Chief Judge: Metro Times.

Michigan's Move to Become a Bigger Player in Presidential Races Shot Down

2007-11-09T10:17:00.000-05:00

I was gratified and amused over the summer to see that Republicans and Democrats in Michigan had agreed to move Michigan's presidential primary up to January 15. This was an uncharacteristically bold move designed to given Michigan a much more prominent role the primary process. Governor Granholm signed the bill into law on September 4. But all good things must end. A judge in Ingham County (Judge William Collette) has found a part of the law unconstitutional. Well, it was fun while it lasted. Under Democratic National Committee rules, only Iowa, Nevada, New Hampshire and South Carolina are allowed to hold primaries before February 5.

This law, if it survives the legal challenge in some form, would make Michigan's primary one of the earliest (number 4 on the hit parade after New Hampshire, Iowa and little Wyoming--if my math is right). For too long other states have been the king-makers. It is not uncommon for the Northeasterners in New Hampshire to vote for one candidate and the sensible Midwesterners in Iowa to vote for totally different candidates. That generally positions the next state to hold a vote as a very important player.

This is a particularly significant position as the primary schedule stands now. Assuming Michigan's primary is held on January 15 (which the pols say is still the big day), another 23 states will hold their primaries and caucuses in just the next three weeks between January 15 and February 5. Any state that holds a primary out in front of the 23 others could well decide who has the momentum going into the next round. With primaries and caucuses packed so densely, there just isn't enough time between primaries to spin results or get media exposure to change the momentum of the juggernaut. Good for Michigan. Other states also moved up their primary and caucus dates for the same reason.

Amid the chaos of the announcement last summer, most of the Democratic candidates pledged not to campaign in Michigan. The Republican hopefuls didn't seem to care much and seem to see it as an opportunity to be alone in the room with us Michiganders for a while to get their positions across. This seems like the smarter position to me.

As to the unconstitutional business, on the bright side Judge Collette did not rule that the entire law was unconstitutional. Rather, he ruled unconstitutional a provision in the law that gives the Democratic and Republican parties exclusive access to lists of people who voted in their party's primary. This ruling, at least implicitly, acknowledges that moving the primary date up is perfectly legal.

However, the ruling effectively cancels the primary date unless there is a successful appeal or state law is changed to allow the vote to go forward. There are several options for lawmakers at this point.

The State Legislature could appeal the ruling. Or, lawmakers can pass a different version of the law that resolves the voter list issues that Judge Collette found so troubling. A two-thirds majority of lawmakers supporting the existing law is another option.

A third option is to let the ruling stand and for the political parties to opt instead for caucuses or nominating conventions to select the candidates. Primaries are better from Michigan's prestige perspective, since they allow for much broader participation by all the party faithful (not just the fanatics who would attend a nominating convention or caucus). Going the convention/caucus route would greatly dilute Michigan's influence in changing the momentum of the race.

Here is the primary and convention schedule as it presently stands:

To Be Determined:

New Hampshire (primary)

JANUARY 2008
January 5: Wyoming (GOP caucuses)
January 14: Iowa (caucuses)
January 15: Michigan
January 19: Nevada (caucuses), South Carolina (Rep primary)
January 29: Florida, South Carolina (Dem primary)

FEBRUARY 2008
February 1: Maine
February 5: Alabama, Alaska, Arizona, Arkansas, California, Colorado (caucuses), Connecticut, Delaware, Georgia, Idaho (Dem), Illinois, Minnesota, Missouri, New Jersey, New Mexico (Dem), New York, North Dakota (caucuses), Oklahoma, Tennessee, Utah
February 9: Louisiana
February 10: Maine (Dem caucuses)
February 12: District of Columbia, Maryland, Virginia
February 19: Hawaii (Dem), Washington, Wisconsin

MARCH 2008
March 4: Massachusetts, Minnesota (Dem), Ohio, Rhode Island, Texas, Vermont
March 8: Wyoming (Dem)
March 11: Mississippi

APRIL 2008
April 22: Pennsylvania

MAY 2008
May 6: Indiana, North Carolina
May 13: Nebraska (primary), West Virginia
May 20: Kentucky, Oregon
May 27: Idaho (Rep)

JUNE 2008
June 3: Montana, New Mexico (Rep), South Dakota

AUGUST 2008
August 25-28: Democratic National Convention in Denver, Colorado

SEPTEMBER 2008
September 1-4: Republican National Convention in Minneapolis-St. Paul.

Perhaps a system where the first state to hold the primary rotates would be a good idea. Every state gets its turn to be a king maker. Or maybe better yet, group the states into four or five sets of 10-12 each. Then hold a primary for one group all on the same day. Wait a month to see who has the momentum and for the spinners to do their thing, then hold the rest, each group's primaries would be a month apart. Rotate which group would go first. Give everyone a real chance to set the trend. That all probably makes too much sense. Forget I said it.

Gypsies, Tramps & Thieves Redux--Fumbling Toward Mediocrity

2007-11-08T14:50:00.000-05:00

Well, the Lansing Parliament may actually be getting it right for a change--maybe. This past Wednesday, the Michigan Senate voted 23-15 to repeal a much-maligned (hated, despised, contemptible, vile, loathsome, odious) tax on services, such as business consulting, tanning and graphic design, before it takes effect Dec. 1. We commented on the malodorous tax in an October 2 post. Read it here. The tax deal was passed in the wee hours of the morning on October 1.

As first reported in that missive, this tax was a bad idea. It expanded Michigan's sales tax to certain services, including fortune tellers, phrenologists and, perhaps most importantly, business consulting services. It is these chaps who will take the biggest hit under the tax and be forced to pass the increases on to customers. It was estimated by some that, if allowed to go forward as planned, the tax could cost consulting businesses $500 million. This would help to crush or drive out still more business from the state. Bleeding an already anemic patient has not been an accepted treatment since the middle ages, which is probably when the Governor and the State Legislators last studied economics.

The full State House is expected to follow up this week, perhaps as early as today. At issue is what new plan should be concocted to replace the $614 million the ghastly tax would pour into state coffers this fiscal year. The key to successfully driving a stake through the black heart of the service tax is making up for the revenue that lawmakers and governor Jennifer Granholm have designated for K-12 public schools and law enforcement, along with other government services. It has not occurred to these people that they need to cut costs and unnecessary services rather increase taxes.

Businesses have argued that the tax is confusing and goes a long way toward making Michigan an even less attractive place to do business. A fundamental flaw in the tax is that it is unfair and taxes some services but not others. Most notably, accounting and legal fees are exempt from the tax.

While they ruminate on the solution, the pols have pushed the date when the tax kicks in back from December 1 to December 20. It is hoped that the delay will buy more time for the Legislature to consider alternatives. Time management is not one of the skills for which this Legislature is widely known.

Having learned from hard experience that the legislature can be neither trusted nor counted on to do the smart thing, the Coalition to Ax the Tax, made up of businesses from around the state, has pledged its willingness to collect signatures place the tax on the ballot and let voters decide in November 2008 whether the tax should be repealed if lawmakers fail to kill it. If we simple proles are going to pay the tax, it seems we should get to vote on it.

"Don't Tase Me Bro' "--The Death of Civil Discourse

2007-11-01T16:09:00.000-04:00

This past Monday Darnell Oldham, Sr., may have gotten himself permanently disinvited to Lansing City Council meetings. Oldham is apparently a bit of an eccentric who amuses himself by disrupting city council meetings. This week Oldham tossed a hangman's noose at the Lansing City Council. Oldham, an African American and Vietnam War vet, asserts that the noose symbolized the Lansing City Council's "lynching" of his right to free speech. Huh? To his credit, Council President Harold Leeman, Jr. is attempting to ban Oldham from future meetings. Good for him. Oldham is a proud representative of an ever increasing class of professional or semi-professional cranks who disrupt meetings and hi-jack events across the country every day.

Recently another professional disruptor interrupted a forum in Florida where failed presidential candidate John Kerry was speaking--or at least attempting to speak. Andre w Meyer, a University of Florida journalism student, repeatedly and forcefully asked Kerry why he conceded the 2004 election after multiple reports of disenfranchisement of black voters and rigged electronic-voting machines. Lest you doubt Meyer's illegitimate purpose, dear reader, shortly before he began his assault, he handed a video camera to a girl in the audience to film him. His intent was to post the video on YouTube, as he has done with other clips of his carefully recorded antics.

Meyer was given the opportunity to ask a question of Senator Kerry. He asked the question. Senator Kerry answered the question. Meyer then refused to leave the microphone and kept talking. Despite being asked to leave the auditorium and eventually being escorted out, he returned and continued to shout out his question. His efforts became so forceful, and his actions so disruptive that it took half a dozen security officers subdue him. He continued to struggle mightily with the officers, even as they tried to carry him out. Finally, they had enough. As one of the officers pulls out his electric Taser, Meyer is heard to exclaim (a little too late), "Don't tase me, bro. Don't tase me." So they taser him. His infantile behavior improved markedly.

What these people don't seem to realize is that their antics interfere with legitimate discourse and, yes, even the work that is being accomplished by these groups. The right to free speech does not give anyone at any time the right to completely disrupt the legitimate activities of the Lansing City Council, a John Kerry speech, or any other legitimate activity.

Meanwhile, back in Lansing, the throwing of a noose is never an acceptable means of expression--whatever the thrower's race. Such a racially charged outburst is beneath the dignity of anyone with a legitimate grievance and Oldham--and ninnies like him--should be banned from future meetings. His point, to the extent Oldham has one, could be made far more forcefully in a civil, coherent manner. If not to the city council, then to the newspapers, television cameras or elsewhere. Failing in that, Oldham should run for the city council then everyone will have to listen his opinions--good, bad or indifferent.

Of course, the Disruptor Class never really has the staying power to legitimately express their views or--heaven forbid--run for office and actually work for change or the positions they claim to advocate. They are more comfortable muttering in the shadows until their their moment in the sun. I've been forced to sit through more than my fair share of meetings that were made to grind to a screeching halt when some professional crank refused to be silenced after a full and fair opportunity to be heard. At those moments, I wish Tasers were standard issue to every city council.

Read more about it in the Lansing Journal. To read more about Meyer episode in Florida and see the video, Click here.

YouTube Owns You! (Or at Least it Owns Your Posted Videos)

2007-10-31T13:59:00.000-04:00

Two years ago, no one had ever heard the word "YouTube". Now, it's everywhere all the time. If you missed an episode of a TV show, it's there. In the mood for an obscure documentary on Transylvania? It's probably there somewhere. But what most people may not know is that under YouTube's Terms of Use policy, it owns anything you post on the site.

While you retain the original copyright to the material, you are also required to grant YouTube a "worldwide, non-exclusive, royalty-free, sublicense and transferable license to use, reproduce and distribute" your work. YouTube can also create derivative works of the submission.

I have not heard of YouTube doing anything with any of these licenses users have granted to them. And they may never do anything, but now that Google owns YouTube, that possibility certainly exists.

Here is the dicey bit from YouTube's Terms of Use page:

C. For clarity, you retain all of your ownership rights in your User Submissions. However, by submitting User Submissions to YouTube, you hereby grant YouTube a worldwide, non-exclusive, royalty-free, sublicenseable and transferable license to use, reproduce, distribute, prepare derivative works of, display, and perform the User Submissions in connection with the YouTube Website and YouTube's (and its successors' and affiliates') business, including without limitation for promoting and redistributing part or all of the YouTube Website (and derivative works thereof) in any media formats and through any media channels. You also hereby grant each user of the YouTube Website a non-exclusive license to access your User Submissions through the Website, and to use, reproduce, distribute, display and perform such User Submissions as permitted through the functionality of the Website and under these Terms of Service. The above licenses granted by you in User Videos terminate within a commercially reasonable time after you remove or delete your User Videos from the YouTube Service. You understand and agree, however, that YouTube may retain, but not display, distribute, or perform, server copies of User Submissions that have been removed or deleted. The above licenses granted by you in User Comments are perpetual and irrevocable.

View it here: http://www.youtube.com/t/terms

This information probably does not apply to 99% of us, but if you are putting a lot of time and money into marketing videos, training, feature movies, shorts or other original content, you may be giving away a lot if you're using YouTube's site to post it. As a matter of fact, all the free video posting sites I looked at require that as a condition of use you transfer to the site the right to use, modify, distribute, etc., your video content, including myspace.com, iFilm, and Yahoo Video, to name a few of the bigger ones. Again, I am not aware of any actual or proposed use of these license rights by the free video posting sites, but that doesn't mean they won't chose to avail themselves of the option in future. We lawyers tend to speak in terms of contingencies and worst case scenarios.

Most things that are free aren't. Be careful with your intellectual property. If you want to retain the rights to your original content, you may be better off going with one of the pay sites that are more limited in their licensing. But that's another post.

Compensation for the Wrongly Convicted--Another Argument for a Part-Time Legislature (As if we needed another one)

2007-10-29T11:25:00.000-04:00

The creativity of Michigan's legislators in coming up with silly ways to spend our money never ceases to amaze. This time they want us to compensate inmates who are wrongly convicted and later freed. If this came to pass Michigan would join a growing number of states that also offer compensation to wrongly convicted criminals who are freed on the basis of DNA testing which, presumably, was unavailable when they were originally convicted. This proposed legislation was brought up in a state House Judiciary committee two weeks ago. The proposal mandates compensation to the wrongly convicted of $50,000 for every year spent behind bars, plus repayment for expenses, lost wages and medical care.

This newly proposed legislation is linked to another fairly recent law affecting the lot of Michigan inmates. In 2001 Michigan enacted a DNA testing law (MCL 770.16) which provides that any person convicted at trial of a felony prior to January 8, 2001 has the right to petition the court for testing of DNA material and, depending on the results, for a new trial based upon the new DNA evidence. The law contains a sunset provision requiring any such petition to be filed before January 1, 2009.

The compensation law would pay money to wrongfully convicted inmates who are freed under MCL 770.16. Leaders of the "Innocence Project" at Cooley Law School in Lansing testified before the Michigan State House Judiciary Committee in favor of the proposed new compensation law. Innocence Project advocates contend that under current law the wrongly convicted inmates receive far less assistance than other inmates when they are released from custody and that they are often ill-equipped to handle life on the streets. The wrongly convicted won't have criminal records and so don't need all the programs to assure their repatriation to society as useful, productive citizens, or so the thinking apparently goes. It seems the real solution would be to offer the wrongly convicted the same services that real criminals get. But that would be too simple.

The Committee also heard testimony from two actual inmates, one of whom would, presumably, benefit from the law. Their convictions were overturned based on DNA evidence that was tested after their original convictions as the science behind the technique advanced. One of the witnesses served eight years on death row before getting sprung (though obviously not in Michigan, which has no death penalty and, hence, no death row).

The cost to taxpayers would be relatively small, according to the bill's sponsor, Rep. Steve Bieda, D-Warren. Bieda makes this claim on the ground that there would be very few ex-inmates eligible. But the small cost needs to be balanced against the “immeasurably huge injustice” a wrongly convicted inmate has suffered, Bieda said.

Since the DNA testing law went into effect, the Cooley Innocence Project has received inquiries from more than 3,500 inmates looking to file DNA evidence petitions. Appeals have been initiated in more than a dozen cases since then, with two convictions being overturned so far.

But DNA testing is hardly infallible. I am reminded of a story back in 2005 relating to the brutal murder of U of M law student Jane Mixer. Mixer was found shot and strangled with a pair of silk stockings in 1969. Re-testing of DNA found on the silk stockings in 2005 revealed something extraordinary. Two DNA matches turned up. One match was returned for Gary Leiterman, the original suspect in the crime. The second match was to a man who was just 4 years old at the time of the 1969 murder. While it is possible that the 4 year-old living in another state at the time participated in the murder of Mixer, it is highly unlikely. (Interestingly, the 4 year-old did apparently grow up to murder his mother, which is why his DNA was in the law enforcement system at all. Weird, huh? You can't make this stuff up). What this does prove, however, is that as advanced as DNA is, it's not infallible.

I can see situations where compensation might be in order. For example, where there is police or prosecutorial misconduct. The Duke Rape Case leaps to mind as a shining example of that scenario. But when everyone is doing his or her job to the best of their ability, with the best technology available at the time (within reason), compensation is unwarranted, particularly in light of Michigan's current budgetary . . . um . . . constraints. This would likely only apply to people convicted years, or even decades ago. Presumably in new cases filed against new suspects, in which law enforcement has state of the art DNA tests available (not to mention the Innocence Project waiting in the wings), false convictions will be few and far between.

Let's do the math just on the unlucky chap who spent all that time on death row who testified before the Judiciary Committee. He was in prison for 9 years. He probably spent another year in the county jail awaiting trial, so let's make it an even 10 years. Under Bieda's plan that means $50,000 per year for being locked up (that's $500,000) plus 10 years of lost income starting in 1998. Median income in 1998 was $38,885, inflation at 3% or so, that's roughly another $400,000. Then we add in medical and expenses (whatever that means). So, we're at roughly $1,000,000 per inmate. Assuming we will be drawing the wrongly convicted from a pool of inmates convicted before DNA testing reached its current state of advancement, that means the recipients of the state's payouts have all been inside the joint for a while. As noted above, Project Innocence has received requests from 3,500 inmates already. They've filed 12 appeals so far. At a cool $1 million or so per person (some will be a lot more, some less), if all 3,500 of those requests turn out to be real, that's $3.5 billion. Even if it's just 10% of that, those are scary numbers for a state in our condition.

Here is another case. In 2002 Eddie Joe Lloyd was freed after DNA testing revealed he did not commit the brutal rape and murder of a Detroit teenager. Lloyd did 17 years for the crime before being freed. Of course, he confessed to the murder. Lloyd was the first person in Michigan to be exonerated on the strength of post-conviction DNA testing. His payout under the proposed law would likely be $2 million plus.

If the issue is reassimilation of wrongly convicted inmates into society (one of the arguments made in favor or the bill), there are cheaper and smarter ways to do it than this law. Obviously if it's a situation of illegal police action or prosecutorial misconduct, then that is a different story. Civil (and even criminal) liability will attach in such cases. In cases involving perjured witness testimony there is also an existing legal remedy. But with all the constitutional checks, balances and protections built into the system, the likelihood of wrongful convictions where everyone is properly doing his or her job, is very slim. Creating a huge windfall for victims who are wrongfully convicted. There are many more reasonable and cost effective ways to compensate the wrongfully convicted.

Televising U.S. Supreme Court Proceedings--A Little Sunlight Never Hurt Anyone (Or Could It?)

2007-10-26T15:24:00.000-04:00

There is a move afoot to begin televising proceedings of the highest court in the land. If the Senate Judiciary Committee has its way, that is. This happens every few years. It happened again this past February.

The Judiciary Committee has proposed televising Supreme Court hearings. It used to be the rule that Supreme Court Justices hated being on television. But lately they've been talking a lot more. This past month Justice Clarence Thomas was making the rounds to all the talking head shows with his new book, "My Grand Father's Son," under his arm. (A great read, I understand). Even before that we saw Justice Ruth Bader Ginsburg chatting it up with Mike Wallace (in her chambers, no less). There was Justice John Paul Stevens who waited until age 86 to do his first TV interview ever with ABC's "Nightline." And then came Justice Stephen Breyer at the big, round oak table with Charlie Rose (not exactly prime time, but a big step nonetheless). And let us not forget Chief Justice John Roberts' show-stealing performance on PBS' series on the Supreme Court. One of the earliest appearances I can recall was Chief Justice William H. Rehnquist's Booknotes interview with Brian Lamb (the brilliant guy behind C-Span) way back in July 1992 when he talked about his new book "Grand Inquest."

And none of these appearances were about inconsequential matters. Most touched on substantive issues and the positions held by the Justices. The discussions may have been couched in terms of the books they were hawking, but books are expressions of deeply held beliefs. Particularly with Supreme Court Justices, books are the expressions of their own beliefs and ideals. But it seems like the High Court may be getting the message that no one reads anymore. Or at least, not before someone like Brian Lamb or the Oprah tells them to.

But they aren't all on the same page on this issue. I'm not sure what the positions of the other justices are, but their actions in appearing on TV in their private lives sheds some light. On the other side of the argument is Justice Anthony Kennedy. He appeared before that same Senate Judiciary Committee in February to implore them not to open up the proceedings to the dreaded cameras (oral arguments have been audio taped for decades). He beseeched the committee to remove the provision from the bill that would televise the hearings. His concerns, as expressed to the committee, are that justices may "play to the camera" and that by making hearings public it could "change our collegial dynamic" and forever "alter the way we hear cases." Wow. I guess he doesn't think much of his colleagues or their ability to get the job done without mugging for the cameras.

I am agnostic on the idea, really. There is a certain mystique about the Court now, even though you can hear the audio from past arguments. I read once that toward the end of his tenure on the bench Justice Thurgood Marshall used to fall asleep during oral arguments. I'm not sure showing things like that is very beneficial to the prestige of the Court. And it should have its prestige intact. It's not like we can vote these guys out.

One reason our system works so well--and why it has always worked so well, is the amazing deference we give the judiciary. Think about it: the Supreme Court doesn't have an army, they don't have secret police, no Sonny Barger and the Hell's Angels, or some burly guys with crooked noses hanging around waiting for orders. The Court has no real ability to enforce its own decisions by threat of violence. And yet, everyone just listens to them because it makes sense that in a society governed by the rule of law, you have to abide by the decision of the highest court in the land. Period. End of story. This is the difference between our system, and every other system of government where an AK-47 trumps the rule of law.

Justice Kennedy's impassioned testimony also gives me hope on another front. His greatest fear seems to be that the cameras will change the way oral arguments are conducted. His unspoken premise underlying that fear is that oral argument actually matters. He clearly believes that the questions the Justices ask and answers given by the lawyers for each side are relevant and are important to their decision on the case. It gives the impression, at least, that the Justices on the highest court in the land don't come into the case with their minds already made up. We forget about this sometimes. The Michigan appellate courts could take a lesson from that.

On the other hand, what a wonderful legacy that would make to be able to actually see the arguments in important cases like Brown vs. Board of Education or Gideon v. Wainwright or Miranda v. Arizona or Roe v. Wade. A powerful counter-argument could be made that it will only increase the respect for, and understanding of the Court. Or maybe not.

Ultimately, I'm just not sure I'm ready for the idea of being able to watch the Supreme Court hear oral arguments on my iPod. It feels a little . . . unseemly.

Once Made, Child Support Payments are Written in Stone

2007-10-23T10:20:00.000-04:00

The Michigan Court of Appeals recently handed down another lulu of a decision. In Fisher v. Fisher (Published decision, dated August 28, 2007). In this ruling a panel of the Court (Davis, Schuette and Borrello) held that there are no refunds for overpayment of child support.

The story goes like this: Grant and Joanne Fisher divorced in 1992. At that time Grant agreed to pay $80 per week in child support. Six years later, the court increased his weekly payment to $117. In 1999, the court determined that Grant's only source of income came from his Social Security disability benefits, so the Friend of the Court again modified the order and began to withhold $510.80 per month from his check to cover his obligation to Joanne. This is where things get a little weird.

Even with all those withholdings, Grant Fisher managed somehow to rack up more than $18,000 in arrearages in his support payments. But at the same time, Joanne ended up collecting nearly $20,000 in excess child support payments. It just gets curiouser and curiouser. This is how she did it: in addition to receiving the funds that were being withheld from Grant's disability checks, Joanne also applied for and began receiving Social Security benefits directly on behalf of the child. The dependant child of an individual on social security disability is also entitled to payments. With all those payments rolling in to Joanne directly from Grant and also from the social security administration , Grant was eventually able to get square on the arrearage. He also overpaid by $20,000. Joanne evidently never bothered to mention to Grant that she was receiving the double payments.

When Grant realized how much Joanne had actually received, he wisely took her to court seeking reimbursement for all those overpayments ($20,000 is a ton of money to almost everyone, but think what it means to someone in Grant's position who is disabled).

The opinion, authored by Judge Alton T. Davis, held that she gets to keep the money: "The relief plaintiff seeks is precluded by MCL 552.603. That statue establishes that 'each support payment [is] the equivalent of a final judgment and prohibit[s] retroactive modification' thereof." This translates into the Friend of the Court doesn't have to give refunds even when it's wrong.

So, Grant Fisher, and every other parent who has overpaid, loses. It is up to each parent paying support carefully monitor the amount he or she is paying because the courts won't do it for you and the Court of Appeals won't give it back to you if you pay too much. Anytime your income changes, seek a modification. This decision would seem to create an added incentive for unscrupulous parents to try to engineer as much overpayment as possible. While the situation in this case is unusual because there was a simultaneous payment being made directly by the government along with the one by Grant, Joanne will never answer for what amounts to a grand deception.

On the bright side, since this was child support, there is some consolation in knowing that Grant's hardship directly or indirectly benefited his child. Which is really the point, I suppose.

Click here for the full text of the decision: Fisher v. Fisher.

Michigan Legislature Could Reverse Protection for Drug Companies

2007-10-22T15:27:00.000-04:00

Michigan is a real anomaly, legally speaking, in the way it protects drug companies from lawsuits. Michigan is the only state in the country that precludes an injured person from suing a drug manufacturer for injuries caused by that drug if it was approved for use by the FDA. On its face the statute, MCL § 600.2946, may make sense. Before the FDA approves any drug it has to go through a bunch of clinical tests and, if safe, it will be approved. Our system is much more cautious than those employed by European countries, and forget the Third World. Our drugs are the safest in the world right? Not really. The FDA makes mistakes all the time.

This past February the State House voted to change this rule and bring it more in line with the drug liability laws in other states. As yet, it has not passed the State Senate or gone to the Governor to be signed into law. The bill would make liability retroactive, which means if you were injured before the law went into effect you can still sue. The bill is now in the Republican-controlled State Senate. It is unlikely that the Senate will pass the measure, but hope springs eternal.

Because of Michigan's weird law, even if you are killed by a drug in Michigan you generally cannot sue the manufacturer. Perhaps the names Fen-Phen, Prempro, Vioxx, Ephedra, Zelnorm and Propulsid, to name just a few, may ring a bell. All were FDA approved. All caused serious health problems or death. The FDA got it wrong. But if you died here, you could not sue.
The only way you could sue is if you could prove that the drug company who sold the drug somehow "fooled" the FDA into approving it even though it was unsafe or if the company sold the drug after it was recalled by the FDA.

The primary purpose of tort liability for drug and other product manufacturers is to make sure that they do everything possible to turn out a safe product. That they do the proper testing in their labs (not that we do the testing for them in our living rooms). Potential liability verdicts are a great disincentive to kill and injure people. The company American Health Products (AHP) set aside more than $18.6 billion to compensate victims of its heavily marketed diet drug Fen-Phen. If that is not an incentive to proceed with caution when marketing powerful and potentially dangerous drugs I don't know what is.

Here is the text of the law in pertinent part:

(5) In a product liability action against a manufacturer or seller, a product that is a drug is not defective or unreasonably dangerous, and the manufacturer or seller is not liable, if the drug was approved for safety and efficacy by the United States food and drug administration, and the drug and its labeling were in compliance with the United States food and drug administration's approval at the time the drug left the control of the manufacturer or seller. However, this subsection does not apply to a drug that is sold in the United States after the effective date of an order of the United States food and drug administration to remove the drug from the market or to withdraw its approval. This subsection does not apply if the defendant at any time before the event that allegedly caused the injury does any of the following:

(a) Intentionally withholds from or misrepresents to the United States food and drug administration information concerning the drug that is required to be submitted under the federal food, drug, and cosmetic act . . . and the drug would not have been approved, or the United States food and drug administration would have withdrawn approval for the drug if the information were accurately submitted.

(b) Makes an illegal payment to an official or employee of the United States food and drug administration for the purpose of securing or maintaining approval of the drug.

Just in case you were wondering how the law impacts real people, here's a story for you. In 2005, 187 Michigan residents injured by the diabetes drug Rezulin filed claims against the manufacturer, Warner-Lambert, in New York. Rezulin, as you may recall, was pulled off the market in 2000 after it was linked to nearly 400 deaths and thousands of other cases where the patients suffered liver failure. The claims by Michigan residents against Warner-Lambert were dismissed by a New York federal court judge because of the Michigan law. And there are thousands of similar stories.

The change in Michigan's goofy drug liability law would bring our jurisprudence in line with the rest of the country. If you are hurt, you can sue--FDA approvals be damned. Of course, as a practical matter, another feature of Michigan law may still prevent the vast majority of people injured by a dangerous drug to sue. The Michigan legislature also put into place caps on product liability awards. As the caps presently stand, it is very difficult for an injured person to find a lawyer to represent him or her on any products liability case in Michigan. Between the cost of litigation and experts, it is not economically feasible to pursue product liability cases in Michigan, at least on an individual basis. Class actions can provide a way. But repealing the drug liability law would be a great start.

New Law on Admissibility of Drug Field Test Result Doesn't Endanger Constitutional Rights

2007-10-17T10:36:00.000-04:00

On September 30, 2007 Governor Granholm signed into law an amendment to the Michigan criminal procedure statute. The amendment, called Public Act 89 of 2007, allows the results of a field drug test to be admitted at the preliminary exam in felony prosecutions for the purpose of establishing probable cause that the suspected drug is indeed a controlled substance. This legislation was passed in an effort to reduce the backlog of drug tests swamping state crime labs which at last count number around 24,000. The delay in processing of drug test results is (or was) anywhere from six to nine months.

The problem has been that many prosecutors refuse to issue an arrest warrant until the test results are received from the state lab. This creates an obvious problem with lots of felons running around committing crimes--and doing whatever else it is that drug felons do--for 6-9 months while the police wait around for the test results to arrive. There are no statistics on how many of those undesirables skip town or, even worse, stay in town and continue to engage in bad behavior.

The new law only pertains to preliminary exams. It permits the prosecutor to use the field test results to show that there is probable cause (a lower threshold showing) to believe that the suspicious substance is, in fact, drugs. At a preliminary exam, a finding by the district court judge that there is probable cause to believe that the defendant committed a crime involving drugs and that there is probable cause to believe that the evidence is drugs allows the defendant to be bound over for trial to the circuit court (the next step in the process).

The new law allows law enforcement to go ahead and issue the arrest warrant immediately without the need to wait for the state lab test results and to instead use the field test at the preliminary exam in district court. Then, only if the felon decides to take the case to trial does the prosecutor need to have the suspected drugs tested at the state lab. Since the vast majority of criminal cases are pled out (usually down to a lesser charge) before trial, this should significantly cut down on the number of tests being done by the state lab and allow lab personnel to do other important lab work. This will save the state a lot of money on unnecessary testing.

Law enforcement officers generally carry test kits containing chemical reactants that are used to test substances believed to be drugs. Currently law enforcement officers carry kits to test for a variety of controlled substances, including heroin, cocaine, methamphetamine, and marijuana. If an officer suspects that a substance obtained during a traffic stop or in the course of a search is drugs, he or she can use one the kits to identify the substance. A positive test result can lead to the person's arrest.

So, the question becomes, is there a downside here? That is, is there a constitutional question involved? Are our Fourth or Fifth Amendment rights in danger of being violated? Probably not. The field test kits used are remarkably accurate--up to 99% in most cases. And if there is any doubt on the part of the accused as to the accuracy (oregano being mistaken for hashish, and so on), he or she can still contest the testing, results, training, accuracy and all the rest. By getting these hoods off the streets sooner, fewer people will be victimized. The new law is going to be given prospective application only and will not apply to cases filed or pending before the law passed.

Of course, the law of unintended consequences being what it is, this could lead to another problem--more crowded prisons. As I noted above, there is currently a 6-9 month delay between arrest and receipt of the test results. If there is a propensity during the long delay for drug felons to flee the state or get killed while taking or selling drugs, then a much faster arrest-trial-sentencing-jail cycle may mean more clients for the prison system.

Read more about the new law as well as the full text here: http://www.michiganvotes.org/2007-HB-4228

Freedom at What Price? Repeal of Michigan Helmet Law Not a Bright Idea

2007-10-12T08:30:00.000-04:00

For 37 years, Michigan has had in place a mandatory helmet safety law requiring motorcycle riders to wear an approved helmet when riding. Michigan is one of 15 states that still have mandatory helmet laws. This week the Michigan Legislature voted to repeal our mandatory helmet law. In principle I absolutely agree that the state should not be able to force anyone to do anything, including wear a helmet. However, in this tangled social web we live in where everyone is responsible for everyone else, the person who is catastrophically injured by his own stupidity never bears the financial cost of that decision. Tax payers and the medical system do. It's a bad law and, much as it pains me to say it, Granholm should veto it again.

The governor vetoed a similar bill just last year. Last year's bill just repealed the helmet law without imposing any responsibility on the injured rider. The new bill at least addresses that issue.

The new bill would allow motorcyclists over 21 to ride without helmets if they pay for a special permit: $100 annually or $200 for a three-year permit. They also would have to complete a motorcycle safety course, carry at least $20,000 of medical insurance and have been licensed to operate a motorcycle for at least two years before chucking their helmets. Unfortunately, the provisions are too anemic to alleviate the problem created: radically increased costs on the system.

No one really disputes that wearing a helmet significantly reduces injuries and fatalities caused by motorcycle accidents. For comparison's sake, the per capita rate of motorcycle deaths in states which do not require that helmets be worn by adult riders is 41% higher than in states with mandatory helmet laws.

According to a 2004 study undertaken by the Michigan State Police, it is estimated that, if passed, this new law will result in at least 22 additional fatalities each year, and 742 additional injuries and $140 million in added economic costs to Michigan citizens. In 2005, there were 3,605 motorcycle crashes involving motorcycles in Michigan which resulted in 122 riders killed and 2,721 injured. And these victims don't all expire instantly on the road. The majority linger for a time in the hospital while natural selection catches up with them. The average cost of a hospital stay is now somewhere north of $8,000 per day, not including surgeries or special rooms. That means the mandatory $20,000 medical coverage imposed by this bill will provide barely two days of hospital care.

A recent federal survey found that the average hospital cost to treat a head injury in an accident was $45,602. But that is just the hospitalization costs. Following that, a moderate to severe closed head injury typically requires months or years of rehab. According to the Michigan Association of Insurance Agents, a survivor of a severe closed head injury is likely to need $9 million in care over a lifetime. Obviously the paltry $20,000 in medical coverage is nowhere near adequate to cover even the hospitalization costs, much less the follow up care. Nor does it attempt to address the issue of long-term or permanent disability.

When Florida repealed its helmet law in 2000, motorcycle fatalities in that state increased by 49% in just the first year, according to a study published in the American Journal of Public Health. A University of California study found that after California passed its mandatory helmet law in the early 1990's, there was a 35% reduction in health care costs for motorcycle related injuries.

It is estimated the increased license fees will raise an additional $15 million for the state. That's good news, right? Unfortunately, the Michigan Office of Highway Safety Planning estimates that repealing the helmet law would add $140 million in costs for the state to cover the injured, brain damaged and paralyzed and their families.

Now, I'm all for the government not telling me what to do. Even though I don't own a motorcycle or smoke, I sympathize with motorcycle riders and smokers alike. Lansing and the feds have no business telling us what to do--even if it's bad for us. It may just be cigarettes and motorcycle helmets today, but next week it's going to be bacon and foie gras. (Don't laugh--Chicago has outlawed foie gras. That's what happens when the Goose Lobby gets too powerful).

The problem is, when the Parliament in Lansing passes a no-fault insurance law that requires me to pay for all medical treatment to an injured motorcycle rider who rode without a helmet, that's where I have a problem. As the insurance law presently exists, if a motorcyclist is injured in an auto accident with a car, the PIP insurance on the car pays for his medical bills, wage loss, rehabilitation, and a whole host of other expenses--possibly for the rest of the rider's life if he or she survives.

If the crash does not involve a car and just involves the motorcycle, then the injured rider's coverage will likely pay. It will, that is, if the rider has purchased the optional PIP coverage or, failing in that, if he has the new mandatory health care coverage mandated by the law and if it covers the injuries. If he is uninsured or underinsured, basically all of us pick up the tab through Medicaid, taxes or increased medical costs charged by the hospitals to cover uninsured patients. And then, if the guy is really hurt and can't go back to work, well, he gets to go on SSI and we still pay the bills.

Amazingly, another study done in 2004, this one by the University of Michigan Transportation Research Institute, found that 44% of motorcyclists involved in a crash are not even licensed to operate the machine. That means that even if the injured rider has the optional PIP insurance or the mandatory$20,000 under this bill, the carrier likely won't pay. And so we're back to the public footing the bill through higher taxes and higher medical costs. And let's not forget that not every rider is single with no children. When the bread winner in the house is disabled or killed, the rest of the family has to be supported by us, too.

People who don't engage in risky behavior are perpetually subsidizing people who do, and there are precious few penalties built into the system to shift the real costs to those who are doing dumb things and overburdening the system. Whether it's smoking or riding without a helmet, there should be some downside to engaging in that behavior so that I don't have subsidize it. While this bill seems to at least acknowledge that problem, it creates much more of burden than it remedies.

And where do these people in Lansing find the time to work on stupid bills that they know are going to be vetoed? They've known that this hideous budget crisis was coming for a year and instead of fixing that problem, they waste time and scarce resources passing this kind of vanity legislation. Another beautiful argument against a full-time legislature (like we needed another one).

If this bill were drafted in a perfect world as the ultimate embodiment of the pay-as-you-go, laissez-faire, assume-your-own-risk philosophy, and helmetless riders were forced to assume all of their own injury costs in the event of an accident with absolutely no cost passed on to the medical system or taxpayers (including the costs to support their widders and orphans), then it would make sense. But as long as "we're all in this together" it's a bad idea. Now, where did I put my foie gras and bacon sandwich. . .?

Britney Spears! Now That I've Got Your Attention, Let's Talk Trademarks on the Web

2007-10-11T08:38:00.000-04:00

An interesting legal battle is emerging between Google and, well, everyone. Or at least everyone who has a trademarked good or service and has a web presence. And, as usual, the courts are a decade or so behind the technology curve and are still struggling to find a workable remedy.

The controversy was born out of the way Google sells ads. Google uses a feature called "AdSense" to generate revenue. AdSense ads are those simple, text ad links that appear off to the side or along the top of some web pages. A number of companies, including one from Michigan, are lining up to try to force Google to stop engaging in trademark infringement in its Adsense program. Here is how it works.

Google sells advertisers certain search terms. Let's say you have a store that sells cheese. If you purchase the term "cheese" from Google, then every time someone enters a search request containing the word "cheese", websites with that phrase will be returned in response to the search request. If the web page participates in AdSense, it has some invisible code embedded into the page which causes Google ads to appear. Those ads are calculated to pertain to your search terms. In the cheese example, you might get AdSense ads that offer cheesecake, brie, or cheese knives for sale. For embedding the AdSense code, the owner of the web page gets a few cents (or more) if people click on the ads. The advertisers, in turn, pay Google, usually on a pay- per-click basis, when people click on the AdSense add. Per click fees range from a few cents to $10 or more for some search terms. It works well. Last year Google reported in excess of $10 billion in revenues from Adsene. No problem, right?

Well, not exactly. You see, the problem is that Google will sell any term as an AdSense search term. This is even true of search terms that are part of the registered service mark or trademark of another company who is a competitor of the company that bought the word from Google.

A Michigan company called American Blind & Wallpaper Factory, Inc. recently sued Google in a California Federal District Court alleging that Google had sold trademarked material to a competitor of American Blind in violation of the Lanham Act (15 U.S.C. 1051) which protects trademarks.

Google had sold to American Blind's competitors search terms like "American Blind", "American Blinds Wallpaper" and even "americanblinds.com". This meant that if a Google searcher, who maybe half remembered driving by the American Blind and Wallpaper store, typed in the term "American Blind", he or she would get back a bunch of web pages to look at, many of which would have Google Adsense adds down the side of the page with links like Americanblinds.com. Trouble is, that link would not take you to the real American Blind and Wallpaper Factory website. Instead, it would take you right to the a competitor's website. Even though the American Blind Company objected, Google kept selling the ads.

American Blind settled the case a few weeks before trial, apparently because it ran out of money. There should be little doubt that Google can outspend just about any opponent in court these days. Other companies are also lining up to sue Google. American Airlines is the next big player to take Google on over this issue. It filed suit in the U.S. District Court for the Northern District of Texas in August of this year. Happily, American has more resources to throw at the problem than American Blind did. But bravo for American Blind for taking on the Googlemonster.

Unfortunately, the courts are a little behind the curve on this. There is a split among the federal circuits as to whether this really is a violation of U.S. Trademark Law or not. In one of the more relevant cases, the 2nd Circuit got it wrong. In 1-800 Contacts, Inc. v. WhenU.com, Inc., decided in 2005, the 2nd Circuit Court of Appeals held that "pop-up" ads that did not use or display the actual service mark of the competitor brand did not violate federal law.

However, there are brights spots. In 2006 the U.S. District Court for Minnesota decided the case of Edina Realty, Inc. v. TheMLSonline.com. The Edina Court held that the defendant's purchase of a trademark as a search term violated the trademark where there were other ways for the defendant to describe its product or service.

The underlying facts in Edina expose the big problem with this type of case. In that case, Edina Realty sued its competitor, another realtor, to force it to stop violating its trademark. Edina did not sue the search engine that was selling the ads. It's a little like treating the symptom rather than the disease. You have to keep lancing those pesky boils. The Edina Court did not address the contrary result reached by the the 2nd Circuit in the 1-800-Contacts, Inc. case. At this writing it does not appear that Michigan U.S. District Courts or the 6th Circuit have addressed the issue.

Bottom line here is just because you have gone to the trouble and expense of protecting your trademark, servicemark or domain name, don't feel too secure in the knowledge that you are fully protected against all comers. Your competitors make be stealing your good name and business aided and abetted by Google. Rather than take on Google (or some other search engine behemoth), it may be easier (and cheaper) in the short run to take on your competitors, one by one--at least until the courts get it right.

Hopefully American Airlines will have better luck on the Google front. It would be unfortunate if Google were allowed to write its own rules that adversely affect so many thousands of companies just because no one can afford to take it on.

iPods, Napster and Kazaa, Oh My

2007-10-05T10:36:00.000-04:00

Yesterday a federal jury returned a verdict of $220,000 against a woman from Minnesota named Jammie Thomas in a music copyright violation case. She was sued in that case by the Recording Industry Association of America (RIAA) for allegedly making available "for sharing" over 1,700 songs through the Kazaa peer-to-peer website. In spite of the actual number of songs she illegally uploaded to the site and made available for download, only 24 songs were at issue in the case. The jury sided with the RIAA and returned a verdict against her of $222,000, though the award could have been much higher under current copyright law. First, a little history on music file sharing is in order.

You may remember a site from a few years ago called "Napster." That was one of the original (and largest) peer-to-peer music sharing sites. A "peer-to-peer" network is basically a big database of songs which allows anyone with access to the network to upload or download songs. Problem is, each time a song is shared for free in this fashion, it violates the copyright of the song's owner.

Napster came about in 1998 when a college student named Shawn Fanning wrote a clever new file sharing software program. The program allowed music lovers to share songs over the internet. The real innovation was that the Napster program was faster and easier than anything before it and that, unlike other sites, the actual song files did not reside on Napster hardware. Instead, the song files were sitting on each user's own computer. Napster was like the dating service that linked users together. What the users did with their songs was their business.

In 1999 Napster, Inc. set up shop in California and by December of 2000, the wildly popular site had over 20 million users. But, this system was just too fun and too easy and too cheap to last. Eventually the heavy metal band Metallica alleged copyright infringement by Napster. The musicians sought to force Napster to shut down or to pay them the royalties they were losing on the freely-traded songs. Ironically, some bands, like Limp Bizkit, embraced the new technology and actively promoted it, going on Napster sponsored music tours.

Napster interposed basically two defenses against the corporate juggernaut. First, that Metallica (and others) could not prove that users of Napster's software were breaking the law. No one had any proof that users were illegally sharing music over Napster's site for free. To counter this, Metallica hired a company called NetPD to investigate Napster file downloads. NetPD proved that Napster users had illegally swapped over 300,000 Metallica songs in just 3 days. Napster shut down those users and extracted promises and affidavits from others that they would not misuse Napster's system to break the law. Other complaints followed by musicians like Dr. Dre, using the same technique Metallica did.

Many may recall the impassioned testimony by Metallica's drummer, Lars Ulrich, before congress. Some also remember that as the day heavy metal died.

Next Napster argued that it was not actually trading in the copyright protected music itself--the users were doing it from their own computers. This is the same logic that protected VCR makers under the Digital Millennium Copyright Act. But the courts saw things differently and ordered Napster to stop trading in copyrighted material. The essence of the reasoning is this: Making a file available for other users of a peer to peer network to download constitutes an infringement of the exclusive distribution rights of the owners, as well as of the reproduction right. Napster shut down in 2001 and reopened a few years later to sell music in accordance with copyright law.

Lawsuits forced Napster to go legit and now it's basically just another version of iTunes, with a better logo. The heir apparent to Napster for the past few years has been Kazaa, also a peer-to-peer music sharing site.

Now back to the Jamie Thomas case. She tried some of the same defenses that Napster used, contending that they could not prove that she downloaded anything or was involved with Kazaa. Unfortunately, she foolishly used the same user ID name for her e-mail and for the Kazaa account. Suspicious. The RIAA was also able to match an IP address to Thomas. That's all the jury needed to finger Thomas as the Kazaa account owner.

Here are the two key jury instructions that sealed the deal:

JURY INSTRUCTION NO. 14: The act of downloading copyrighted sound recordings on a peer-to-peer network, without license from the copyright owners, violates the copyright owners' exclusive reproduction right.

JURY INSTRUCTION NO. 15: The act of making copyrighted sound recordings available for electronic distribution on a peer-to-peer network, without license from the copyright owners, violates the copyright owners' exclusive right of distribution, regardless of whether actual distribution has been shown.

Obviously Instruction No. 15 is the killer. Just by making the songs available for download--even if no one ever downloads a song--is a violation of the law. The jury actually did Thomas quite a favor. The jurors awarded $9,250 in damages for each of the 24 songs, for a total of $222,000. They could have awarded up to $18,000 per song. For 24 songs that's $720,000. But, they split the baby. Maybe there were a few old Napster users on the panel.

So, if you or your kids are sharing mp3 music files using Kazaa or a similar site, save your pennies. The RIAA is coming for you. I wonder what Beethoven would have made of all this.

This excellent post by Declan McCullagh has some good links and information: Article.

Gypsies, Tramps and Thieves

2007-10-02T08:08:00.000-04:00

I doubt that the fortune tellers saw this one coming. Palm readers, fortune tellers and the singing telegram set will find themselves a little poorer starting December 1, 2007. Early on Monday October 1 the state legislature agreed to a budget deal that will raise the Michigan state income tax and expand the state sales tax to include a vast array of services not formerly taxed. The income tax rate was raised from 3.9 to 4.35%. All this to avoid the dreaded government shutdown. What is so terrible about a shutdown anyway? The casinos are staying open. Has everyone forgotten that the most terrifying words in the English language are "I'm from the government and I'm here to help you"? Bring on the shutdown.

The victims of the increase are, as usual, the working class who take the hit on the income tax. But more troubling is the expansion of the sales tax to certain services. Lansing's political class has now deputized a whole new crop of revenue collectors. But the vast majority of the providers of these services are also the least able financially comply with yet another level of government paperwork in connection with their businesses. Remember, very few of these new tax targets currently collect or remit sales taxes to the state. They have to start tax collecting from scratch--and soon. Very few private investigators or singing telegram deliverers also have a gift shop in the lobby that makes them worry about collecting sales taxes. I wish I were an accountant right now.

The list of services that will now be taxed include:

Tanning salons

Escort services

Massages

Administrative services (such as payroll)

Investment advising

Janitorial

Armored cars

Private investigators

Packaging and labeling

Commercial landscaping

Skiing

Business service centers

Carpet and upholstery cleaning

Courier services

Document preparation

Self-storage

Transit

Ground passenger services

Travel agents

Scenic transportation

Service contracts

Interior design

Warehousing

Storage

Baby shoe bronzing,

Balloon-o-gram services

Palm reading

Pay phones

Singing telegrams

Psychics

Phrenology services

Personal trainers

House sitting

Shoeshine services

On the bright side, these services will not be subject to the expansion of the sales tax:

Cable or satellite television

Sports and concert tickets

Vehicle repair

Golf greens fees

Marina fees

Movies

Legal fees

Accounting fees

Haircuts

As this list makes clear, it is obvious that palm readers, phrenologists and baby shoe bronzers are vastly underrepresented in the state legislature. Indeed, I doubt there is a single tarot card reader in the Lansing parliament. By the same token, cable TV, accountants, teachers, barbers and lawyers (all of whom apparently enjoy golf, large boats, and expensive haircuts) are overrepresented.

If there is any justice, the afflicted professions will get together and sue to repeal the tax. I don't know that it will pass constitutional muster. What is the rationale for taxing phrenologists but not accountants or lawyers? And what did palm readers ever do to anyone? I would be willing to be bet that doctors kill way more people every year than palm readers or paid escorts.

You would think that a full-time legislature could come up with a better solution this. On the other hand, maybe they've got their eyes on the real prize. Maybe we aren't getting the big picture here. This massive tax hike bumps Michigan up to number 11 in the list of states with the highest tax burden (up from 14th). Obviously having the highest unemployment rate in the nation is not enough for these ambitious politicians. Being the most highly taxed state.

On the bright side, I doubt the taxes on these services will generate the revenue the political class in Lansing think it will. Cash is certainly king in the escort and massage business, after all. Maybe I'll get my government shut down when all is said and done. The small business people in the state could use the break.

Fiend of the Court May Go Private

2007-09-18T16:22:00.000-04:00

The headline of this post is not a typo. Many who have had first-hand contact with the Friend of the Court (FOC) system in Michigan--and particularly the Wayne County species--regard it as a fiendish beast of a system that is inefficient, inaccessible, indifferent and frequently wrong. Now Wayne County Circuit Court Chief Judge Mary Beth Kelly has announced plans to privatize the Wayne County Friend of the Court. If the plan goes through (an uphill battle, to put it mildly), the 169 current employees will find themselves employees of one of the private companies that manages friend of the court services in other states, including Texas, Tennessee and Illinois.

Apparently the plan would affect FOC employees who handle child support payments but not referees or mediators. Any bid to run the $28-million per year operation would include a requirement that the new management agree to hire all of the 169 current employees, plus hire one third more staff within the first year.

Predictably, Council 25 of the American Federation of State, County and Municipal Employees (AFSCME) opposes the move, even though it appears that there would be no adverse consequences to the pensions or other benefits of the employees. It is unclear whether the employees would remain unionized. County Executive Robert Ficano also seems skeptical of the plan.

Privatizing this beast can only be in an improvement over the current system. As it currently stands, good parents who are just trying to get the support the law says they deserve are often frustrated in their efforts. At the same time, hardworking individuals are crushed financially as deadbeat parents who can pay but won't too often slip through the cracks. Frequently there is no way to determine what has been payed or what is owed. Parents trying to provide for their children deserve a system that works.

The really good thing about private management of the FOC system is that if the company who gets the bid doesn't improve on the current mess, then they can be fired and a different company that can get the job done will hired. The knowledge that the contract can be terminated for poor performance will do wonders to improve service, accuracy and accountability. The current system leaves no room for accountability and no incentive to improve the process.

We can cashier our politicians when they fail to live up to our (albeit low) expectations. We can fire our phone company for a new one that provides better service for less money. Why not apply the same rules to a service like the Friend of the Court too? Unlike cell phone service, what the FOC does actually matters a lot to the families that are caught up the court-ordered support system. The children deserve better than they currently get. Let's see how the "fiend" fares under new management.

See the Wayne County Circuit Court website for more information: http://www.3rdcc.org/. If you need help with a divorce or child support matter, consult one of our attorneys.

Adios, Gonzales

2007-09-18T09:23:00.000-04:00

On August 27 Alberto Gonzales announced that he was resigning from his post as U.S. Attorney General, a position he held since February 2005. He is a true American success story, whatever his faults.

The son of immigrant farm workers (the second of eight children), he joined the Air Force in 1973 and then worked his way through Rice University in Houston, where he impressed his professors with his intellect. From there he went on to Harvard Law. From Harvard he returned to Texas in 1982 and went into private practice in Houston. He eventually became a partner at the prestigious law firm, Vinson and Elkins, where he worked until 1994.

It was in 1994 that he caught eye of Governor George Bush, who made Gonzales general counsel to the governor. Later on he also served as Texas Secretary of State, Justice of the Texas Supreme Court, and then White House Counsel. By all accounts he was a good judge--smart and reasoned in his opinions. He was also a reasonably good administrator as Texas Secretary of State. All that seems to have changed when he hit the rarefied air of Washington as the replacement for Bush's first Attorney General, John Ashcroft, who left after Bush's first term.

Gonzales may be best remembered for his work as the legal mind behind much of the anti-terror policy of the Bush administration, including the position that the Geneva Convention does not apply to Al-Qaeda terrorists. He was also an early advocate of the Patriot Act. As a strong advocate of national security, it is somewhat ironic that his inability to articulate before congress the legal and factual underpinnings of the NSA warantless surveillance program contributed to his fall from grace.

For Bush's part, Gonzales probably kept the special prosecutor monster at bay. The Democrats would have loved to unleash a series of special prosecutors on every issue from the justifications for the Iraq war to the firing of the U.S. Attorneys. Whatever the merits of the need for such investigations, his actions did minimize the distractions faced by the Bush Whitehouse in the post-9/11 period.

It is the firing of the U.S. Attorneys that really ultimately brought Gonzales to this point. Since January 2007 his testimony before Congress has been increasingly . . . dumb. The reviews of his testimony were resoundingly bad. Awful even. His testimony was, at best, inconsistent and, at worst, dissembling, obfuscating and possibly even perjurous, by some accounts. By spring there was no one left to defend him, except the Boss. Had his testimony reflected the man's true intellectual ability, no one should have been able to lay a glove on him.

One tragedy is that Gonzales's pet projects, which included stamping out child pornography and combating gang violence, fell by the wayside. Gonzales cared deeply about these issues and found that his ability to focus the Department on these worthy causes was increasingly impeded by the controversy surrounding him. Thus ends the tenure of the first Hispanic Attorney General.

His departure will no doubt be good for the Justice Department which is demoralized and distracted. It is a bad end for the first Hispanic to hold the post. He was mild-mannered, genial, professional and awed by the amazing success he was able to achieve. We should be awed too.

Man Bites Dog

2007-09-14T11:11:00.000-04:00

Over the past few weeks it seems like the Metro-Detroit area has been plagued by a rash of severe dog attacks. Just in the past week an elderly man and a 4-month old child were killed. A female jogger was also attacked and injured. Dog attacks can leave severe physical and emotional scars, which may never completely heal.

It also seems like the dog is usually a pit bull or Rottweiler, but in reality any dog can attack and inflict a serious or even fatal injury. True, large powerful dogs tend to do more damage than other, less robust breeds. The media, too, seems to prefer to sensationalize the pit bull attacks over the poodle nips.

Many people don't realize that in Michigan the law is quite victim-friendly regarding the civil liability of a dog's owner or caretaker for injuries caused by the animal. Michigan is a "strict liability" state in that if a dog attacks, the owner is liable. There is no such thing as "one free bite" in Michigan. An injured party does not have to prove that the dog was vicious or attacked before. All a plaintiff must prove is that the bite occurred and injuries resulted.

Strict liability means there is no defense unless the dog was provoked by the victim. Provocation is one of the few defenses available under the dog bite statute. Though there is no state leash law, most cities have a leash law which requires that any dog be kept on a leash when off the owner's property or in public. The fact that a dog was on a leash when it causes the injury is likewise not a defense under the dog bite statute.

Any dog owner whose animal injures someone also faces the possibility of criminal penalties. And the dog itself may pay the ultimate price for its transgression. The prosecutor is empowered to seek destruction of the offending animal, if the circumstances warrant it.

If you have one or more dogs, be certain you have insurance to cover any injuries the dog may cause. Absent insurance coverage, your assets are fair game for the injured person. You may also be liable for injuries inflicted on your premises by dogs belonging to other people if the dog is there with your permission or knowledge.

Our firm handles many serious dog bite cases every year, some of which result in a significant settlement for the injured plaintiff. Know your rights. The statute of limitations may prevent recovery for your injuries if you don't file a timely claim. If you've been the victim of a dog bite, please contact us to learn what your rights are.

Selling Your Settlement May Not Be the Best Way to Fast Cash

2007-09-11T11:13:00.000-04:00

Last week I was in court waiting for my case to be called when I watched the most extraordinary exchange between a young woman and the judge. The petitioner was a normal looking girl of about 22. She was before the judge asking the court to approve the partial sale of her personal injury settlement. From what I could gather, the girl had been injured in an accident or as result of some egregious malpractice when she was very young. A suit was filed and a settlement of about $1 million reached. Her mother (who was not present) had wisely put the settlement into a structured settlement.

Upon reaching 18 she received a lump sum and then about every 2-3 years thereafter she would receive another sizable payment (something like $50,000 each). She was due to receive the next $50,000 payment in a few months. She was going to collect about another $300,000 in these periodic payments before receiving a final six-figure payout when she turned 35.

Here is the extraordinary part: She was in court asking the judge to approve the sale of around $300,000 of her future payments for the thumping great sum of $27,000. There was an attorney there from the company looking to complete purchase. And, the company was going to stick her with their legal bills, to the tune of a few thousand more dollars. She said she wanted to use the money for bills and tuition.

Not surprisingly, the judge (to her credit) was somewhat perplexed as to why the girl before her could not wait another few months for the $50,000 she was scheduled to receive. The judge asked the girl if she had tried to get a conventional loan from a bank or credit union. With a guaranteed $50,000 coming in a few months, any bank would be willing to give her the loan she needed. At this the girl began to cry, saying that she had a poor credit rating and that those banks were going to charge her a high interest rate. It seemed to escape her that she was, in effect, paying over 1000% interest on this little deal.

After some back and forth the judge agreed to approve the transaction on the condition that the girl consult with an independent financial planner and come back in two weeks with a letter proving that the plan made financial sense. Presumably the judge approved it since the girl had the legal right to make the deal. The judge was probably hoping someone could talk some sense into the girl before she came back.

The unfortunate part of all this is that she had not consulted an attorney or a good financial planner before signing on the dotted line. Had she done so she could have saved herself $270,000. This points out the incredibly poor financial education our young people are receiving.
If you have a settlement, annuity or lottery prize being paid in installment payments, be sure to consult an attorney and financial planner before you do something drastic like trade away a fortune in future payments for a pittance today.

Beware Pocorn Lung Syndrome--Of Course Popcorn was too Good to be True

2007-09-07T15:41:00.000-04:00

Well, it's happened again. One of our favorite snacks is a hidden killer. Yes, good old popcorn (low in calories and a good source of fiber) is suddenly at the center of a national health controversy. A chemical called "diacetyl," which is used to make artificial butter flavoring used in microwave popcorn, has now been linked to a dread respiratory disease called "popcorn lung" (the technical name is bronchiolitis obliterans).

Popcorn Lung has been detected in hundreds of people, mostly those working in microwave popcorn factories who work closely with the stuff. Labor unions and nationally recognized occupational health scientists are demanding that the federal government create an emergency safety standard for the chemical in the workplace to protect the masses.

Lest you think that this is an affliction affecting only a few individuals, sources indicate that flavoring manufacturers have already paid out more than $100 million as a result of lawsuits and claims by people sick with popcorn lung just in the past five years. One death has been confirmed due to the disease. OSHA (Occupational Safety and Health Administration) the board that sets standards for workplace safety, including chemical exposure, has no standard for diacetyl.

On the bright side, it appears popcorn is still safe to eat at home. Just don't inhale directly from the bag, if you know what's good for you. Next week: Killer pickles.

Another Blow to The Rights of the Injured--Death of the Discovery Rule in Michigan

2007-09-04T14:13:00.000-04:00

Summer is rapidly becoming my least favorite season, legally speaking. A sentiment that is no doubt echoed by thousands of personal injury victims across Michigan who are continually and systematically being stripped of their legal right to be compensated. It seems that every summer--usually in July or August--the Michigan Supreme Court hands down a decision that summarily and sweepingly wipes out the rights of an entire class of litigants to bring suit and seek compensation for their personal injuries.

Three years ago it was Kreiner v. Fisher, which imposed harsh restrictions upon those injured in auto accidents to sue. Then last year in July it was Reed v. Breton which severely curtailed the right of manypeople injured by drunk drivers to sue for their injuries. Cameron v. Auto Club is another gem which serverely curtailed the right of the injured to seek benefits from their own insurance companies under the No-Fault Act.

Now this year we have received another July Surprise in the form of a delightful little decision called Trentadue v. Gorton (decided July 25, 2007). What is the Trentadue decision? Glad you asked. It modifies statute of limitation law in a significant way.

For virtually all of Michigan's existence as a state, our legislature has imposed, for the most part, reasonable statutes of limitations on all types of cases: Two years for medical malpractice. Three years for ordinary negligence. Fifteen years for adverse possession and so on. And for over 100 years the courts have also adhered to what is known as the "Discovery Rule" to alleviate the sometimes harsh results that a hard and fast statute of limitations rule can sometimes deliver.

The Discovery Rule is a rule of equity (fairness) that gives judges the power to make a "common law" exception to the general statute of limitations rule where the plaintiff--through no fault of his or her own--was not able to discover the cause of the harm or the identity the defendant until after the normal statute of limitations had expired. The Discovery Rule creates a short 6-month window within which the plaintiff could still bring suit for his or her injuries.

An example of this might be the person who at age 19 is exposed to some toxic substance at the building where she works, but no one knows that she was exposed to it. The exposure creates terrible health problems for her. She can no longer work and for 5 years no doctor can figure out what the cause of her symptoms is. They diagnose her with every catch-all disease there is: Epstein-Barr, fibromyalgia, or, even worse, some psychosomatic disorder. Then, finally, a miracle--she finds a doctor that is able to diagnose and treat her condition. He tells her that her devastating medical problems are due to the chemical exposure when she was 19. She wants to sue her employer's landlord for her injuries. After all, her life and health have been ruined. However, the statute of limitations for negligence is just three years. Ordinarily, she would be out of luck. But, in its wisdom, Michigan law created an exception called the Discovery Rule. If she files suit within six months of discovering her cause of action, her case would not be dismissed on statute of limitations grounds and she would be entitled to recover against the building owner who poisoned her. A good and just rule, right?

Well no longer. The Trentadue decision has done away with the discovery rule, except in a few narrowly defined circumstances (fraud by the defendant, medical malpractice). The facts in the Trentadue case are particularly tragic. Margarette Eby was raped and murdered in 1986 in her home. But the killer was never caught. Then, in 2002, DNA testing finally became available that revealed the identity of the killer. It was an employee of a sprinkler service company that serviced sprinklers on the property where Eby was renting a house (the murderer was son of the company's owners). The killer, Jeffrey Gorton, confessed and was sentenced to life in prison.

Eby's daughter sued the sprinkler company for her mother's rape and murder. Even though it was 16 years after the crime was committed, the Discovery Rule should have preserved the right of Eby's estate to sue. The trial judge agreed. The Court of Appeals also got it right, holding that Eby's daughter deserved her day in court.

But on appeal to the Supreme Court, in a four-judge majority opinion (Corrigan, Markman, Taylor, Young), decided that the Discovery Rule is now extinct. To their credit, Justices Elizabeth Weaver, Marilyn Kelly and Michael Cavanagh dissented. They should be commended for their wisdom and sense of fairness. But the majority rules. So, as a result of the Trentadue decision, hundreds or even thousands of injured people will be denied their day in court. Injured people, one of the groups most deserving of legal protection from our courts, deserve better.

Be Wary of Reverse Mortgages and Be Sure to Go with a Legitimate Lender

2007-08-25T15:13:00.000-04:00

Reverse mortgages can be a real boon to older homeowners whose homes are paid off or who have only a small remaining mortgage balance that can be paid off at closing. A reverse mortgage, as the name implies, is simply a means by which a homeowner can access the equity in his or her home without incurring a monthly mortgage payment as you would with a traditional first or second mortgage. However, anyone considering this should be careful and do their homework. There are unethical brokers out there and the news is replete with accounts of elderly homeowners being swindled out of their homes. A reverse mortgage can provide you with money to pay living expenses, do upgrades or pay taxes.

Another advantage to reverse mortgages is that the money is nontaxable and it will not affect your eligibility for social security or medicare benefits.

In order to qualify for a reverse mortgage, you must generally be living in the home. You may also qualify if you own a mobile home, manufactured home, or live in a multiple family unit with 4 or less units, one of which is occupied by you as your primary residence. There are three basic types of reverse mortgage. These are:

Single-Purpose Reverse Mortgages. These are typically offered by state and local government agencies and nonprofit organizations;
Federally-Insured Reverse Mortgages. These are also known as Home Equity Conversion Mortgages (HECMs), and are backed by the U. S. Department of Housing and Urban Development (HUD); and
Proprietary Reverse Mortgages. These are generally private loans that are backed by the companies that develop them. Pay careful attention to fees and costs.

Each type of reverse mortgage has its own unique features. Single-purpose reverse mortgages generally have very low closing and other costs. However, they are not available everywhere, and they only can be used for one purpose specified by the government or nonprofit lender. For example, they can be used to pay for home repairs, improvements, or property taxes. In most cases, you can qualify for these loans only if you qualify as having low or moderate income.

HECMs and proprietary reverse mortgages generally tend to be more costly than other types of home loans. The up-front costs can be quite high, so they are generally most expensive if you stay in your home for just a short time because the financing charges are spread over a relatively short time frame. On the plus side, HECMs are widely available, have no income or medical requirements, and can be used for any purpose.

Before applying for a HECM, you must meet with a counselor from an independent government-approved housing counseling agency. The counselor will explain the loan’s costs, its financial implications, and any available alternatives to a reverse mortgage. Counselors should tell you about government or nonprofit programs for which you may qualify, and any single-purpose or proprietary reverse mortgages available in your area.

The amount of money you can borrow with a HECM or proprietary reverse mortgage is dependent on several factors, including your age, the type of reverse mortgage you select, the appraised value of your home. The current interest rates and where you live are also factored in. Generally speaking, you get more money the older you are, the more valuable your home, and the less you owe on it.

The also HECM gives you choices in how the loan is paid to you. You can select fixed monthly cash advances for a specific period or for as long as you live in your home. You also have the option to choose a line of credit. This method allows you to draw on the loan proceeds at any time in amounts that you choose. You also can usually also get a combination of monthly payments to you plus a line of credit.

HECMs generally provide larger loan advances at a lower total cost compared with proprietary loans. But owners of higher-valued homes may get bigger loan advances from a proprietary reverse mortgage. That is, if you have a higher appraised value without a large mortgage, then you may likely qualify for greater funds. Location (for example, your neighborhood) is only one part of the determination of appraised value.

But remember: A reverse mortgage can also deplete the equity in your home. If you plan to pass your home on to your family or a charity, remember that the reverse mortgage is generally due on sale of the property or the death of the borrower. The reverse mortgage must be paid either in cash by the heirs or out of the proceeds of the home sale. The loan plus costs and interest can greatly deplete your home of its value.

If you are in a situation where you need money for bills, taxes or living expenses and your only asset is your home which is fully or nearly paid off, a reverse mortgage may be for you. Just remember, thoroughly research your options and go with a reputable lender. Shop around--rates differ from lender to letter, sometimes by a lot. There are several different types of reverse mortgages and the costs and terms differ. Pick the one that is right for you. Keep in mind too, even though you are not making monthly payments to a bank, this is a loan. The loan must be paid back when you die or when you sell your home. Be sure to consult with an attorney before signing any paperwork.

For more information see these websites:

www.aarp.org/revmort/list

www.hud.gov/offices/hsg/sfh/hecm/rmtopten.cfm

www.ftc.gov/bcp/menus/consumer/credit.shtm