Posts Tagged ‘settlement’

Insurance Investigators and Your Claim: The Case of the Irritating Investigator

A Typical Insurer's Private Investigator (no, I'm just joking . . . )

A LETTER FROM THE INTERNET: I’m often asked about the role of ‘private investigators’ in personal injury claims.  In response, here’s a letter that I responded to on Avvo.com, a web-based attorney information service that I participate in, that might interest readers:

“hello,

i was involve in a car accident. i know that sometimes insurance companies hire private investigator if they think that there is a fraud or the case amount is high. i was wondering what is high amount?

thanks
emmy”

SETTING THE RECORD STRAIGHT ON INVESTIGATORS:

Here’s my answer to Emmy’s letter:

Dear Emmy,

Sorry for your accident. Of course, my naturally suspicious mind is driven to this question: why are you worrying about an investigator? In the words of most defense attorneys and insurance adjusters: ‘Do you have something to hide’?

WHAT A PRIVATE INVESTIGATOR DOES: To answer your question more seriously: having worked as both a defense lawyer, representing insurers, and as a plaintiff lawyer representing injured persons, I can tell you with some measure of certainty that there is no ‘high amount’ that triggers an investigation. The insurance adjusters will deploy investigators when a claim ‘looks’ suspect (for an extreme and somewhat exaggerated example, a person with a sprained pinkie saying that they’re disabled for life will likely be subject to surveillance if there’s an ongoing claim). The decision to send out someone to follow a claimant and see how they’re spending their time in real life is based on subjective criteria, and, in my experience, is often left to the adjuster’s discretion.

DOES “SIZE MATTER”: Of course, if a claimant is seeking minimal compensation, an insurer may decide that it’s not cost efficient to spend $2,000 – $3,000 to deploy an investigator, and might decide to settle the claim at a low level rather than incur that cost on top of the settlement cost. However, increasingly insurers seek to ‘send a message’ to claimants by aggressively investigating what they feel are suspect claims.

These ‘investigators’ are an annoyance. They’re hired to develop evidence, whether by observation or often by photograph or video, that a person isn’t as badly injured as they claim. In my practice, from both sides of the aisle, I’ve rarely seen an investigator hired by an insurer who was an accurate, independent, direct and honest reporter of what they observe.

THE INSIDER’S GUIDE TO INVESTIGATORS: More often, in my experience, these ‘investigators’ (really, paid spies) recognize who’s paying the bill, and rather than acting as independent witnesses, they turn themselves into advocacy witnesses to try to help the insurance companies or defense firms who pay for their services. These ‘investigators’ (sometimes retired adjusters; often, retired or disabled former law enforcement or private security officers) often hide or selectively record evidence of a claimant’s activity in an effort to try to ‘amplify’ the actions of an allegedly injured person. In other words, when the person looks healthy, they start the video recorder; when they look injured, they turn the recorder off. Not only that, but insurers and defendants, under the rubric of ‘work product’, try to hide the existence of such ‘spies’ and their videos until the eve of trial (a process I’m very critical of, and which I believe is based on old and discredited practice).

MALIS|LAW PUTS THEIR INVESTIGATORS TO WORK — FOR YOU!: I’ve developed several pre-trial techniques for ‘smoking the investigator out’, and if your attorney is savvy, he or she will know what to do to make sure that there are no rude surprises as you approach trial or settlement of your case.  The good news is that often these investigators can be discredited by good, aggressive cross-examination in discovery or at trial; their bias exposed; and their opinions weakened. Even better, their ‘spying’ sometimes proves disability, rather than disprove it.

In many of my larger cases, I’ve been able to take this investigative evidence and use it to coerce the insurer to pay more for the claim, by showing that the ‘paid spy’ actually learned that my client was more severely injured than even the insurer thought.  MALIS|LAW bloggers can see an example of this in practice in my December, 2009 post about a construction accident case that we settled for $900,000 in total benefits that we already published in this blog, “The Case of the Deleted Defect” .

HONESTY IS THE BEST POLICY; YOU HAVE NOTHING TO HIDE: Despite this pernicious practice, although in my experience these investigators may occasionally disclose someone working when they claim to be disabled, it’s never happened to me or my clients. As I advise clients and others often, an injured person’s best weapon in personal injury litigation is their honesty.  If you can perform an activity, admit it.  If you can’t, tell your lawyer what you can’t do and why.  Ultimately, frank and honest disclosure of the extent of your injury is always to your benefit, and will generally help your lawyer obtain a fair and full settlement for you.

Settlement Update: $285,000 For Injured Hospital Worker Attacked by Insane Patient — The Case of the Harried Hospital

THE SETTLEMENT: MALIS|LAW, hired as trial approached, working with Attorney Dean Brunel,  has obtained a $285,000 settlement from a mental hospital on behalf of a cleaning contractor with a significant knee injury.  The cleaning contractor’s knee was significantly injured when he was assaulted by a psychotic patient who was allowed to walk freely in the corridors of a mental hospital while being admitted.

THE HOSPITAL’S NEGLIGENCE: The patient was being transferred from the open unit of the institution to the ‘closed’ unit on an involuntary admission, with a known history of violence, especially towards people of color.  The institution had few formalized guidelines for such transfers, developing them after the patient attempted to strangle my client as he cleaned the hallway.  As a result of the assault, my client suffered a stretched and torn ACL (anterior cruciate ligament) of his left knee, which an orthopedic surgeon addressed by reattaching and treating the fibers with heat.

CREATING A WINNER: Attorney Brunel approached me to try the case about one month before trial.  The client had not treated with a physician for several years, although he had complaints of knee pain.  Given the imminent trial, we mounted a ‘full court press’ to make the case trial ready.  I approached his original surgeon, who ordered a newMRI of his knee and found that the surgical repair, which had been performed with an experimental technique that has since been abandoned, had again failed, requiring additional procedures.  Within that month, I also developed expert psychiatric testimony of the hospital’s failure to follow proper procedures for communication of information about a committed patient between outpatient and inpatient wings of the hospital, which accounted for the lack of proper security and the patient’s being allowed in the vicinity of other persons at the hospital.  Literally on the eve of trial, I was contacted by the institution’s insurer, which agreed to settle.  The settlement was paid by the insurers for the institution; the admitting psychiatrist, who was sued for negligence; and the facility’s security company for negligent security.

Settlement Update: $900,000 in Benefits For Injured Worker When a Contractor ‘Covers Up” — The Case of the Deleted Defect

Torn Rotator Cuff

MALIS|LAW has obtained a stream of payments of over $700,000, along with waiver of a $210,000 workers’ compensation lien, for an electrician who injured her neck and shoulder after tripping over a floor hazard on a poorly lit construction site, even though the general contractor apparently attempted to ‘get rid of the evidence’ before it was observed by its own safety director.

AN ELECTRICIAN TRIPS AND IS HURT: My client was a 41 year old experienced female electrical worker assisting in the construction of a major addition to a Boston hospital.  While wiring an unfinished floor’s alarm system, she was walking with a spool of wire and tripped over bolt stubs protruding through the floor of a dimly lit corridor.  She fell forward into a pipe rack at the side of the hallway, injuring her left shoulder rotator cuff.  Within minutes of her fall, a crew of workers apparently descended on the accident scene, grinding the bolts level with the floor (leaving shiny patches on the concrete) and stringing new lighting in the hallway.  When the project safety director showed up at the accident scene, he observed a brightly lit corridor with orange paint splotches on the floor where the bolts had been.

THE INJURIES: My client suffered a torn rotator cuff immediately after the accident, which was surgically repaired.  The repair disclosed that the torn shoulder had obscured radiating neck pain into her shoulder caused by a disk herniation, which was surgically addressed by neck fusion.  We contended that she could no longer work in the construction trades, which required heavy exertion, which would cost her hundreds of thousands of dollars in future lost earnings from a highly paid and specialized trade.

OUR INVESTIGATION: Through two years of discovery and depositions, we were able to build a strong case that the general contractor and lighting contractor were negligent, including the following evidence:

  • My client presented a co-worker and independent witness who both verified the presence of the bolts before and after the accident.
  • Persistent document subpoenas and court orders produced ample records that the project lighting contractor had been criticized by the general contractor and its own inspectors for failure to replace burnt out project lighting promptly.
  • A safety audit conducted two weeks prior to my client’s fall harshly criticized the cleanliness of the project’s walkways, citing multiple trip hazards and trash.
  • A deposition of another worker disclosed that the bolts and poor lighting had caused another worker to trip days before, and that the worker had complained to the project’s safety director, who had failed either to note his complaint or to take action to remedy the hazard.
  • Although no one came forward to disclose the workers’  grinding of the floor bolts and new lighting, my client’s project supervisor verified the presence  four shiny ground down bolts in the floor within 40 minutes of the accident, in a pattern which suggested that the bolts had been used to secure an elevator hoist (the elevators had been fully installed weeks before).
  • The project safety director admitted that although he had investigated the accident scene, camera in hand, within 30 minutes of the accident, he failed to document conditions on the scene, although it was his and the general contractor’s policy that he do so.
  • The general contractor had written a letter to all subcontractors weeks prior to the accident detailing poor safety conditions and threatening to backcharge contractors for correcting them.
  • My client’s accident report was withheld for two weeks prior to disclosure to the project’s insurer, with no explanation of why the information was not immediately forwarded.

OUR STRATEGY: We used these facts to paint a picture of a poorly supervised and generally unsafe site, with the project owner and supervisors on notice of impending problems, and an embattled safety director new to the site and not up to speed.  These circumstances would lead a jury to infer that the accident was ‘covered up’ to avoid project controversy, supporting our claims of negligence.

PROVING DISABILITY: As to injury, the contractors and their insurers and attorneys contended that the Plaintiff’s injuries were largely healed and her complaints of pain were largely distorted.  An attempt to intimidate my client with a late-disclosed private investigation which purportedly showed that she was able to perform work was frustrated by a court order allowing the investigator’s deposition.  The investigator admitted (less than a week before a court-scheduled mediation) that he had not observed my client engaging in any substantial exertion, and that she had labored in picking up pieces of firewood that a delivery company had dropped in her driveway.

THE SETTLEMENT: At mediation, we were able to persuade my client’s workers’ compensation insurer to drop its right to be repaid $210,000 in compensation payments which my client had received, and to persuade the liability insurer to pay a stream of payments worth in total over $700,000 over a five year period.  These payments ennabled my client to retrain, and she now works for an electrical contractor in a supervisory position, without need for substantial exertion, at or near her prior pay level.

Settlement Update: $4.1 Million Settlement For Construction Worker’s Spinal Injury After Staircase Falls — The Case of the Slumping Staircase

 

The "$4 Million Dollar Stairs"

Attorney Daniel Malis of MALIS|LAW, with the assistance of  Attorney Frederick Fairburn of Fairburn & Dyke in Lawrence, announced the culmination last week of five years of litigation involving the collapse of a stairway on a construction project in Hampton, NH which injured a Massachusetts plumber, though a settlement from various defendants totalling $4.1 million.

SERIOUS INJURY ON CONSTRUCTION SITE: The wood framed, 17 stair staircase collapsed after framing contractors, under the instruction of the general contractor, disconnected the stairs from side supports to insert fireproof drywall, but left the stairs in that disconnected fashion for a period of time between 1 day and more than two weeks depending upon which witness was believed.  My client, a plumber, was climbing the staircase when it collapsed.  When the staircase struck the landing below, the small of his back struck the edge of the stairs, crushing one of his vertebrae.  Following the collapse, the general contractor immediately re-erected the stairway; secured all stairways at the sides with extra nailers; and did not disclose the accident to local inspectors or the project engineer during a site visit the following day.

Demonstrative Evidence Showing the Damage to Client's Spine

MY CLIENT’S SPINAL INJURY: My client, a married 35 year old Massachusetts apprentice plumber, suffered a crush injury to his L1 vertebra when a 17 stair wood frame staircase gave way.  He was med-evacuated from a NH hospital to Beth Israel Hospital where he underwent the first of three surgeries over 5 years to stabilize his back, including, by the time of the final surgery, a four level lumbar fusion, with fixating steel rods extending over 7 vertebrae, and with additional surgery likely in the future.   While his motor functions were preserved, the employee remained in chronic, debilitating pain, with narcotic pain relief as his only medical recourse, and, according to Plaintiff’s vocational expert, was permanently totally disabled.  Plaintiff’s vocational expert and economist calculated the present value of his earnings loss over his career at $1.7 million which, with his $400,000 in medical expenses to date and continuing, presented special damages in excess of $2.1 million.

FINDING THE BEST FORUM FOR MY CLIENT: Rather than bringing suit in New Hampshire, we brought suit under diversity jurisdiction in federal court in Massachusetts against the engineer, architect and general contractor.  The New Hampshire-based design professionals claimed that Massachusetts had no jurisdiction over the case, and that the lawsuit belonged in New Hampshire, with a local judge to decide my client’s fate.  Despite the presentation of carefully worded affidavits from the architect and engineer which distanced the ‘design team’ from Massachusetts, our own investigation showed that both professionals were licensed in Massachusetts and had substantial contacts with this state, and the court denied their motion.

BUILDING A STRONG CASE: Vigorous discovery disclosed the identity of a Massachusetts –based framing supplier who had contracted to perform the framing, along with two NH-based framing subcontractors hired by that company to do the actual work.  These companies were joined as third party defendants.  The general contractor blamed the framers for the collapse; the framers claimed that they destabilized the staircase at the general contractor’s instruction.

THE CONTRACTORS’ NEGLIGENCE: Depositions of witnesses and other site contractors revealed that the staircases were not built according to plan or specification.  Testimony and post-accident photographs taken by a separate plumbing contractor who was first on the scene revealed that the subcontracting framers had sloppily  ‘toenailed’ the bottom of the stringers at an angle into plywood on the platform, instead of using a cleat or nailer which would have allowed the stringers to be nailed straight through the plywood platform securely into the carrying  beam. This substandard bottom connection of the staircase,  allowed the stair bottom to slip and kick out over time once the general contractor ordered the staircase to be disconnected for drywall installation, and was a major contributing cause of the staircase collapse..  The framing contractors’ departure from site plans and use of substandard attachment methods were not detected by the general contractor; the framing supplier, who contractually agreed to supervise the framing work; or the architect and engineer, who had contracted to inspect the site.

During a day-long deposition, the framing contractor who disconnected the stairs at their sides for drywall installation finally admitted that he knew that he had rendered the staircases unstable.  He admitted that while he would normally block off stairs left in this precarious shape, he could not explain why he did not do so on the stairs at this site.  These admissions established clear liability on the framing subcontractors, as well as confirmed the general contractor’s negligence for ordering the disconnection and failing to observe the improper staircase installation.     .

THE DEFENDANTS TRY TO EVADE LIABILITY: While the Plaintiff had established uncontroverted evidence of a drastic injury, the extent of his disability was disputed by the Defendants with a vocational assessment which, despite the Plaintiff’s dependence on narcotic painkillers, alleged that he still had the ability to consistently perform light duty work.  This was rebutted not only by the Plaintiff’s sympathetic appearance and supporting opinions from two orthopedic surgeons, as well as a vocational expert, but also by the graphic evidence shown above demonstrating that his seven level spinal fusion was unstable, with the securing screws shifting in his vertebral bodies and eroding the bone in which they were secured.

Following discovery, the parties attended a day long mediation, which was initially sought by the Defendants to settle the claim.  However, negotiations were reduced to a full day of finger pointing among the Defendants, with no real offers made.   We took advantage of this apparent disaster by sending demand letters under c.93A to the insurers for the general contractor and the framing supplier, based upon their complete failure to promptly evaluate the Plaintiffs’ claim and accurately address their exposures.

Eventually, on the date that responses to Plaintiff’s demand letters were due, the dispute (which at end turned out to be an argument over legal fees between the Defendants) was tabled between the insurers, and the general contractor and framing supplier tendered their full policy limits of $2 million to resolve both parties’ liability.  This opened a window to settle with the erring framing joint venture for $1.6 million, leaving the so-called ‘design professionals’, the architect and engineer, who had yet to tender an offer.

THE ARCHITECT AND ENGINEER’S NEGLIGENCE: The so-called ‘design team’ initially declined to settle, and presented a vigorous defense, despite admissions from the architect that the project engineer should have detected the improper staircase installation.  Counsel for the designers sought summary judgment, alleging that the entire cause of collapse was the building contractors’ negligence, and that the architect and engineer played no role in the staircase’s collapse.  Plaintiff presented countering affidavits from a construction expert and design experts initially presented by the settling Defendants and then retained by Plaintiff.  Summary Judgment was denied, and the case scheduled for trial in early 2010.

Plaintiffs further sought an order from the Court pending trial seeking to prevent offset of the settlement against any jury award, based upon New Hampshire’s ‘hybrid’ contribution statute, which awards damages based upon a contributing defendant’s percentage of negligent contribution to an accident (so-called ‘pure contribution’) but does not credit the settlement contributions of other settling parties.   While this motion was pending, the parties attended a half day mediation session with the previous mediator, Attorney Mulvey, and, over the strenuous objections of the architect and engineer, their insurers settled the remaining claims for $500,000, bringing the my client and his wife’s total recovery to just over $4.1 million.

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FAQs, Interesting News and Law-Related Rants

Daniel Malis uses this blog to publish answers to frequently asked questions, convey interesting news and make the occasional law-related rant. If you have any questions or want to contact Daniel Malis, please see the Contact page of the MALIS|LAW Website.