Attorney Find Blog

Mandatory automobile insurance laws became the norm in the 1950s, but that development was quickly followed by new complications:  clogged courtrooms, disparate awards for similar injuries, and delays in compensation for accident victims in need of timely medical care.  A handful of states thought they’d found the solution with no-fault insurance, and Florida was one of the first.  Florida’s PIP (personal injury protection) system took effect in 1972.

Now, that law is set to “sundown”, or automatically expire, if the legislature doesn’t act to renew it, and that renewal is strongly opposed by many who say the PIP system is too riddled with fraud to work effectively.  One fraud examiner indicated that 40% of his insurance fraud caseload sprung from PIP claims.  Lawmakers made an attempt at addressing the fraud issue in legislation passed last year, but Governor Jeb Bush vetoed the law, saying that it didn’t go far enough.

Some health officials have suggested that an end to PIP would create a crisis for the state’s public hospitals, which would provide the only treatment option for many uninsured accident victims without the no-fault coverage.   Consumers, like legislators, are divided, but it’s an issue that can’t be ignored.  Change is coming no later than October, when the existing law will pass out of force whether or not there is replacement legislation in place.

At the Golden Globes, Sacha Cohen thanked every American who hadn’t sued him, but that’s a shrinking group. The allegations in lawsuits surrounding the internationally successful Borat movie primarily relate to people who appeared in the movie claiming that they were misled into signing releases.

Kathie Martin, owner of an Alabama etiquette school, claims she was told her class was being filmed for a television documentary. Two fraternity members claim they were plied with alcohol and then told that the movie wouldn’t be shown in the United States before they signed their releases.

We don’t know exactly what these reluctant film stars were told, and we don’t know exactly what the releases they signed said. But reality television (and now, reality films) hinge on the producers’ ability to mislead participants. The element of surprise is frequently a key factor in the production of a reality tv show, whether it be a tabloid talk show where a woman comes on thinking she’s getting a makeover, only to learn that her sister is sleeping with her husband, or it’s an etiquette teacher who thinks she’s being filmed for a documentary when the footage will really be used in a comedy.

To that end, the releases signed in conjunction with such productions generally contain something I’ll call a “consent to mislead” clause. It’s basically a clause that says that they may have lied to you about their plans for the footage or the purpose of your interview or interaction or game or test or audition or whatever it is that you’re doing, and that’s okay with you, and they can use the footage however they choose.

Why would anyone sign such an agreement? It’s a fair question, but there are fair answers. The producers of such shows have logical explanations for those clauses, and some of them are valid. The premises of many reality-based shows depend upon less than full disclosure in advance–otherwise, the spontanaiety that such shows are selling to their audiences would be lost. But how often do those reassurances come with soothing words like, “Oh, that doesn’t really apply to you–that’s there for….”

I know it does at least some of the time. I’ve heard it with my own ears. Do those misrepresentations outside the four corners of the agreement impact the validity of the release? That’s a complicated legal question. Generally speaking, nothing outside the document itself is considered binding–the contract is the contract. However, in some areas of law there are exceptions specifically for those occasions when someone in a position of greater knowledge and power has used those misrepresentations specifically for the purpose of closing the deal.

I don’t know what to expect from the Borat lawsuits, but I think they’re getting attention for all the wrong reasons. The legal precedent regarding the ability of reality show participants to sue because they’d been misled could impact the whole structure of reality programming. That creates a powerful incentive for this company to fight tooth and nail to preserve its right to mislead these participants.

A federal judge has put a $50 million Hurricane Katrina class action settlement for as many as 35,000 State Farm policy holders on hold due to the need for more information from the parties involved, especially the insurance company. U.S. District Judge L.T. Senter of the U.S. District Court of Southern Mississippi decline to sign off on the widely-reported settlement and wrote that the settlement did not establish a “fair, just, balanced or reasonable” procedure for handling such claims. The rejected agreement promised that State Farm would reconsider Hurricane Katrina insurance claims and denials for some 35,000 policyholders who did not sue the company.

Specifically, Senter questioned everything from plaintiff cases and blanket security given to State Farm and its agents to the moneys involved and the scope of the insurance settlement. Senter especially wondered if the blanket immunity and proposed claims process would give State Farm too much power in these types of cases. He also said the plan was not a global settlement because it didn’t do enough to include claims of those people currently involved in litigation who may wish to opt into this settlement, and added that the $50 million cap should be broadened. With that said, the leading plaintiff attorneys in the settlement said that they still plan to make initial payments to the hundreds of families they represent in the settlement apart from the proposed class.

It is unknown whether this federal decision will affect a separate $80 million settlement between State Farm and some 640 cases already in litigation.