Use of Tobacco Settlement Money Under Scrutiny by PA Tax Payers
Tobacco companies agreed to massive settlements to the states about a decade ago. Now, Pennsylvania taxpayers are scrutinizing the allocation of hundreds of millions of dollars of tobacco settlement money into the state’s general fund instead of to health-care programs.
The decision by Republican Gov. Tom Corbett was heavily criticized by health-care advocates who noted that the state recently terminated a low-cost insurance program, AdultBasic, begun in 2002, that assisted about 41,000 people who earned too much money to qualify for Medicaid but not enough to afford private insurance.
Mike Wereschagin of the Pittsburg Tribune-Review wrote in State’s use of tobacco settlement money lights fire under crowd that Auditor General Jack Wagner has been hosting public hearings around the state to show that $1.34 billion in tobacco settlement funds had been spent on non-health-related programs over the past 10 years. He also wants the public to voice their concerns about how the money is spent.
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AdultBasic cost about $200 million in the past year. The governor’s office says the state cannot afford the program, given the state’s $4 billion deficit. The program’s cost was borne by private insurers under an agreement with former Democratic Gov. Ed Rendell.
Mr. Wagner, a Democrat, countered that the tobacco money, which is paid in annual installments, would more than cover the cost of the insurance program. Otherwise, taxpayers end up paying for uninsured health costs.
Governor Corbett’s budget would move $220 million in tobacco settlement money from a state-run health-care investment fund to a proposed economic development fund.
Picower Settlement Helps Madoff Victims
Some of the victims of Bernie Madoff’s Ponzi scheme will benefit from a recent settlement of claims brought against the estate of Jeffry Picower. The $7.2 billion settlement is the largest single forfeiture in American judicial history.
In her New York Times article about the Jeffry Picower settlement, Deal Recovers $7.2 Billion for Madoff Fraud Victims, Diana B. Henriques lists the total amount now available for compensating Madoff victims at just under $10 billion, approximately half the estimated cash losses in the fraud.
However, Irving H. Picard, the trustee in charge of gathering assets for Madoff’s victims, believes the amount of losses could grow as he continues his negotiations with Madoff’s investors. Picard can sue investors who withdrew money regardless of whether or not they suspected the fraud. Those profits would then be distributed to the investors who lost money in the scheme.
The $7.2 billion payment is part of a global settlement of claims brought against the estate of Jeffry M. Picower, who died in 2009. His widow, Barbara, approved the settlement on behalf of the estate. Mrs. Picower’s attorney stated that she was returning every penny her husband had received from his Madoff accounts. The amount represents the exact difference between how much Picower invested with Mr. Madoff, just under $620 million, and the cash he withdrew from his accounts.
Barbara Picower made a statement that she was absolutely confident [her] husband, Jeffry, was in no way complicit in Madoff’s fraud. No one has charged him with any illegal conduct; however, Picard asserted in his complaint that Picower, an experienced investor, should have recognized Madoff’s fraud. Attorneys for Picower disagreed, pointing out that he wasn’t alone in being fooled. The fraud fooled regulators, hedge fund managers and major accounting firms for years.
The settlement is in two parts. First, the estate will pay $5 billion to settle Picard’s complaint. Then it will pay the Justice Department $2.2 billion to settle civil forfeiture claims. All of the money will go to eligible Madoff victims.
For more information on recent and noteworthy settlements, check out our section on settlements in the news.
Ground Zero Settlement
After a seven-year legal battle, a ground zero settlement has finally been reached. More than 10,000 police officers, construction workers and firefighters sued the city of New York over health problems they suffered after working in the ruins of the World Trade Center. Over 95% of the workers have agreed to the settlement.
The ground zero settlements total at least $625 million. Individual payments will depend on how sick the plaintiff is. Payouts will range from $3,250 to $1.8 million for the most severely injured.
Judge Alvin K. Hellerstein threw out a smaller settlement for the ground zero workers in March. He claimed the city didn’t offer enough money and that the lawyers were taking too large a cut. In response, the lawyers reduced their fees from a third to a quarter of the settlement.
Throughout the process, there was disagreement over which illnesses were actually caused by the toxic dust around ground zero, and which ones might have occurred anyway. Many of the 520 plaintiffs who rejected the 9/11 settlements felt they were being shortchanged because they weren’t afflicted with a qualifying illness. They were worried they’d fall ill in the future and wouldn’t have the money for proper care.
Others claimed there was no certainty in the agreement. They believed once the claims administrator evaluated their histories, the payments could be reduced.
Those who chose to opt out of this ground zero settlement will continue their lawsuits before Judge Hellerstein.
For more information on recent and noteworthy settlements, check out our section on settlements in the news.
Class Action Lawsuit against Facebook over “Like” Buttons
Los Angeles - The big social media site Facebook is another facing a class action lawsuit. Now the lawsuit is under the terms that they dishonestly took the names and likenesses of minors without parental consent for profits.
In the case #BC444482, David cohen v. Facebook, the plaintiffs argue that Facebook has dishonestly used an underage's name or likeness for profit. Based on the plaintiffs explanations, it has happened more than one million instances.
Facebook is obligated to get parental consent before using that type of information from minor's to profit from it, that's what the plaintiffs believe.
"When a teenager sees that their Facebook friends Like’ an ad, it piques their curiosity, making them more likely to click the ad or visit the page, says Los Angeles plaintiff attorney John Torjesen of John C. Torjesen & Associates. We believe it is a clear case of exploitation of children for the sake of profits."
Facebook says they will fight vigorously because they don't think they have any wrongdoing. "We believe this suit is completely without merit and we will fight it vigorously. The complaint misunderstands the law, it’s intent and the way Facebook works. For example, plaintiffs assert that minors are marketing Facebook through search engines but we do not allow minors to include their profiles in search engines," said Andrew Noyes, Facebook’s manager of public policy communications, in a statement provided to Mashable.
In 2009, Facebook settled a class action lawsuit for $9.5 million over its now-defunct Beacon program.
Since a class action lawsuit is a very complicated subject for a layperson, only an experienced Los Angeles class action lawyer can assist you through all aspects of the legal process. Visit our website if you have any further questions about Los Angeles class action lawsuits.
Resources:
Jennifer Van Grove at Mashable
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