While Space Exploration Fuels Innovation, Legal Fears Often Keep Innovation Grounded

SpaceWith Pluto-mania sweeping the nation, we used our “Let’s Be Fair” radio commentary this week to recognize some of the ways that consumers have benefited from space exploration, and how we might still benefit in the future if liability concerns don’t stall innovation.

Modern conveniences like cell phone cameras, scratch-resistant lenses for sunglasses, water purification systems, and CAT scans were all originally developed by NASA. Yes, if you have ever been treated with a CAT scanner or know of a loved one who has, you have the space program to thank for this. This cancer-detecting tech was first used to find imperfections in space components.

Because of the brilliant minds working at NASA, it often seems like the only limit on what we can create is our own imagination. Unfortunately, one of the barriers to innovation is entirely man-made and unique to America: legal fear.

For example, at this time, a device invented by a former NASA engineer that could save lives by making it impossible to text, talk or email on a cell phone while driving is being kept off the market — in large part – because of fears about lawsuits. In a previous blog post, I explained how legal fear was stalling the rollout of this amazing technology even though the entrepreneur who developed it got two heavyweights in the insurance and cell phone industries to support his efforts.

The number of new consumer products that have been kept out of the market certainly includes many more than those developed by NASA engineers, however. John Stossel identified a number of these in an excellent article a few years ago. They include things like hypodermic needles that cause less pain to patients, a substitute for asbestos, and a medicine that relieves morning sickness for pregnant women suffering from nausea.

The morning sickness medicine, Bendectin, was finally returned to the U.S. market in 2013, 30 years after the manufacturer pulled it off shelves here in response to lawsuits that later turned out to be completely unfounded. All during those three decades, women in Canada and Europe benefited from the relief provided by Bendectin while women in the U.S. suffered unnecessarily from their nausea.

Over the years, I have talked with many entrepreneurs who either decided not to bring products to market, or who have chosen not to provide consumer-friendly modifications to their products, because of concerns over being sued. These legal concerns do not tie the hands of innovators in any other country in the world, and the real losers are American consumers.

The negative effect that lawsuit abuse has on product development and innovation is as much of a concern to consumers at the extra money we all pay for products that do make it to market.

Photo courtesy of FreeDigitalPhotos.net and xedos4.

The Sticky Legalisms of Wacky Warning Labels

Washington Times 2015 op-edThis op-ed article by the author of “Let’s Be Fair” appeared in the Washington Times on July 3, 2015.

Not too long ago, common sense ruled the day, so called because it was shared by nearly everybody. Common values, commonly understood sense of right and wrong, just and unjust, all expressed in a common language of fairness.

But what’s happened to common sense in America? Our laws, as expressed in opinions by our courts, seem disconnected from the common sense that defined our experience.

Take a look at any of the five labels that have just been named finalists in our 18th annual Wacky Warning Labels™ Contest.

There’s a warning on a ceiling-mounted smoke alarm that actually says: “Silence feature is intended to temporarily silence the horn while you identify and correct the problem…It will not extinguish a fire.” Really? Someone needs to be told that pushing a button on a device smaller than most cereal bowls won’t put out a fire?

Or take the warning label someone found on a one-inch-tall water-absorbent grow toy that looks like the Easter Bunny. To the amusement of kids across America, it expands when you place it in water. However, read the fine print on the packaging, and you’ll find a warning that says, “This toy is in no way intended to represent living people. Any resemblance is purely coincidental and not intended to harm anyone.” Evidently, someone wasn’t amused by the appearance of the toy.

Countless products are plastered with common sense warning labels today because lawyers have advised product makers that if they don’t provide the warnings, they could be sued. It’s why a popular four-inch-long brass fishing lure with sharp hooks dangling off the end now warns: “Harmful if swallowed.”

That warning was one of our past winners. The owner of the family-run business that made these fishing lures for nearly one hundred years without needing to put that warning on its products told us that they finally decided to provide that warning on the advice of a lawyer. They were informed they could be sued under California’s Proposition 65 law that requires labels on products that contain certain chemicals even though no one in their right mind would try to swallow a fishing lure. Prop 65 has been a bonanza for plaintiff lawyers, but according to experts in the field, there isn’t a single empirical study demonstrating any public-health benefits of Prop 65.

While the fear of being sued over risks that are common sense is relatively new in the long history of our country, reformers have been calling for more common sense in public policy for centuries. In fact, as we prepare to celebrate Independence Day, it’s worth noting that several months before the Declaration of Independence was written in Philadelphia, Thomas Paine published a pamphlet called Common Sense.

Thomas Paine’s pamphlet helped spark the American Revolution by encouraging colonists to rethink the rules by which they were living, and today, it holds lessons about the importance of rethinking the rules of a civil justice system that forces law-abiding product makers to worry about being sued if someone misuses their product.

In the opening paragraph of Common Sense, Paine wrote that “a long habit of not thinking a thing wrong, gives it a superficial appearance of being right, and raises at first a formidable outcry in defense of custom.” In today’s language, what Paine was saying is that it’s easy lose sight of how wrong something is when it becomes an everyday part of one’s life.

Excessive litigation has become such an everyday part of life in America that many people don’t question it anymore. However, these wacky warning labels – which aren’t found in other countries, by the way – should themselves be a warning that it’s time for us to change old lawsuit habits that haven’t served us well. Judges and lawmakers need to tell plaintiff lawyers that personal responsibility and common sense still have a place in America’s courts. When that happens, we won’t need labels like the one found this year on a bag of frozen catfish pieces that warns: “Contains fish.”

Announcing The Finalists In Our 18th Annual Wacky Warning Labels™ Contest

WWL15_Smoke_Alarm_Warning_CFAThe five wackiest warning labels of 2015 have just been announced as part of the Center for America’s 18th annual Wacky Warning Labels™ Contest. They are:

• A label on a ceiling-mounted smoke alarm that warns: “Silence Feature is intended to temporarily silence the horn while you identify and correct the problem…It will not extinguish a fire.” Submitted by Charlene Fairleigh, Eugene, Oregon)

• A warning on a one-inch tall water-absorbent grow toy that looks like the Easter Bunny that says: “This toy is in no way intended to represent living people. Any resemblance is purely coincidental and not intended to harm anyone.” Submitted by Jacob Eckberg, Hopewell, Virgina

• A label on a patio door that cautions: “Door may swing open or closed in windy conditions. Door could hit person causing injury.” Submitted by Elizabeth Stout, New Orleans, Louisiana

• A label on a bag of frozen catfish pieces that warns: “Contains fish.” Submitted by James Andrews, College Station, Texas

• A warning at a bowling alley that says: “Bowl at your own risk. Risk of bodily injury is associated with this game.” Submitted by Conor Friedersdorf, Venice, California

We find these silly warning labels on products sold throughout America because, in this era of excessive litigation, labels must do more than protect consumers from possible injuries, they have to protect product makers from frivolous lawsuits.

Tune in to John Stossel’s show on FOX Business News Friday, July 24 to see which labels earn the three cash prizes. The winners are selected by Stossel’s studio audience, and the grand prize winner receives $1,000!

Worldwide Survey Of Litigation Trends Reveals Grim News For America

world with gavelCompanies in the United States are now facing more than twice as much litigation as companies in other countries. That’s the disturbing finding of a survey recently conducted by the third-largest law firm in the world. Click here for a summary.

The firm, Norton Rose Fulbright, which happens to be the largest law firm in the world based outside the US, conducted a poll of more than 800 corporate counsel representing companies across 26 countries, and the results are not good for American companies or the job seekers who would like to work for them.

While the survey is performed to identify litigation trends across the world, what it reveals about America’s addiction to the legal fix should make lawmakers here sick. Nowhere else in the world does the legal system suck as much money out of the production of goods and services as it does in the United States. Click here for a pdf file of the survey.

It’s not getting any better, either. According to the survey, the number of US companies spending at least ten million dollars a year on their lawsuit budgets soared nearly fifty percent in just the last two years. Fifty percent!

What kind of lawsuits do companies have to spend so much time and money defending these days? According to the survey, a growing percentage of the legal action against companies is being brought by their own government. Consider this:

“…more US respondents say regulatory/investigations are a top concern compared with the broader sample (48 percent to 39 percent).”

In other words, half of the companies that do business in America are concerned that they’ll be investigated by a regulatory agency. Of course, this is not news to any job providers reading this. However, it may be news to lawmakers who have been elected on job creation platforms across the country because there are so few studies that compare the level of litigation in America with other countries.

In addition, the poll also reveals that:

“personal injury litigation is significantly more prevalent in the US than in other countries, with 21 percent of respondents selecting it as one of the most numerous types of cases they faced in the previous 12 months. That compares to just 15 percent in the survey overall.”

Now, it’s no surprise that the US is the most lawsuit-happy country on earth, but this survey confirms that this problem is growing faster than many have believed. With the US government reporting that the economy slowed to a crawl in the most recent quarter, the last thing job seekers need is companies having to divert precious financial resources from job creation into fighting lawsuits.

This column originally appeared in Townhall.com on May 24, 2015. 

Class Action Lawsuit Against Winemakers Grabs Headlines But Doesn’t Pass The Smell Test

wine1A recent class action lawsuit filed against several well-known California winemakers over arsenic found in their wine shows once again how easy it is to misuse the American courts to create fear where none is warranted and then attempt to make money off the situation.

Arsenic in wine?! The provocative statement alone is enough to grab the attention of even the most casual wine drinker, but it’s a story that even non-wine enthusiasts need to hear.

In case you missed it, CBS News first reported in March that several winemakers including Sutter Home Winery, Beringer Vineyards, Fetzer Vineyards, Woodbridge Winery and Trader Joe’s are being sued after a laboratory reported that some of their wines were “contaminated with arsenic in levels above regulatory standards.” It led to news reports nationwide and sensationalistic headlines like:

“Alarming levels of arsenic in some popular wines, lawsuit claims” in Florida, and

“Lawsuit claims popular, low-cost wines contain high levels of arsenic” in Colorado.

What wine drinker wouldn’t be a little concerned after reading that? My concern after looking into this lawsuit, however, is that many consumers will hear the headlines and be afraid that retailers in the United States are selling dangerous wines because they don’t know the full story. So, here are the facts.

To begin with, the statement that the wines contain arsenic levels “above regulatory standards” is totally misleading. The truth is that the US government does not regulate arsenic levels in wine. The government has, on the other hand, limited the amount of arsenic in water for many years, but comparing water to wine is like comparing apples to oranges.

After the CBS report was aired, FDA spokeswoman, Lauren Sucher, revealed to CNN that the EPA standard for arsenic in drinking water:

“is of limited use when considering any potential health risks related to arsenic in wine. People drink far more water than they do wine over their lifetimes, and they start drinking water earlier in life. Thus, both the amount and period of exposure are different and would require separate analyses.”

Furthermore, seeing as the USDA recommends drinking about 10 cups of water a day and no more than two alcoholic drinks (about 1 cup of wine) a day, Cornell University’s Gavin Lavi told CNN that “a sensible concentration limit for arsenic in wine should be at least 10-fold higher than for drinking water, and possibly higher, since we also use water for cooking and cleaning.”

While the United States doesn’t regulate the amount of arsenic in wine, Canada and Europe do. In a subsequent story that provided much-needed perspective on this issue, NPR reported that:

“The upper threshold, set by Health Canada, is 100 parts per billion, or ppb. And the limit set by OIV, a European intergovernmental wine organization, is even higher at 200 ppb.“

None of the California wines produced by the wineries named in the class-action lawsuit tested higher than 50 ppb!

So, if these wines are safe by standards set by the top wine-consuming regions in the world, why does a lawsuit like this see the light of day? It’s impossible to rationalize why courts allow such speculative lawsuits, but it IS possible to see how someone could personally benefit from this litigation.

The Wine Business Blog published a news release from the public relations firm representing the laboratory, BeverageGrades, that released the testing results that led to this lawsuit. In the release, the lab cites the CBS story that reported on its test results and then conveniently states that the laboratory also “offers alcoholic beverage retailers a tool for screening their offerings to ensure the quality of their supply chain.”

Would it be too cynical to suppose, as the wine blog suggests, that the laboratory has taken a page from Marketing 101 and created a problem to which it can provide a solution for financial gain? It wouldn’t be the first time our courts have been manipulated like this. The big question is, why is it allowed to continue?

Disease-Fighting Biotech Companies Are Fighting A Disease Of Their Own: Lawsuits

DNAbiotechIn recent years, innovative ways of treating cancer have provided new hope to thousands of patients. Many of these treatments have been developed by startup biotech companies, but now a major investor in these companies is speaking out about a crisis threatening to derail this important research.

In a Wall Street Journal op-ed entitled, “Too Bad Biotechs Can’t Cure Tort Abuse,” venture capitalist, Standish Fleming, writes that small companies being formed to fight diseases are now: “suffering from a disease of their own – a legalized extortion by plaintiffs’ lawyers looking to make a quick buck.”

He reveals that shareholder lawsuits against growing companies are threatening access to the capital these startups need to develop new drugs that are years away from generating revenues. As a board member of a biotech firm that was being acquired, he was told by an attorney representing his company that they should expect to be sued as part of the merger. His prediction turned out to be true.

The attorney obviously knew that the majority of these mergers are challenged by lawsuits. Part of the problem is that it’s relatively easy, says Fleming. They can follow a “cookie-cutter process with potentially seven-figure payoffs.” In fact, according to Cornerstone Research, 94% of sales above $100 million result in a lawsuit.

Small biotech companies face on average more than $3 million in legal and accounting costs when preparing to sell stock to fund their growth, and many can’t afford this expense. Fleming argues that the mere threat of a lawsuit can be enough to prevent a small company from raising the capital they need, so they feel compelled to settle as quickly as possible.

The last thing we need standing in the way of the next potential big medical breakthrough is American’s legal system. When a leader in funding this research signals an alarm, it’s time for our lawmakers to listen.

Waterlogged iPod Provides A Troubling Lesson About America’s Legal System

waterloggedipodThere are a lot of things you can learn by dropping your iPod into a bucket of water. The first thing is pretty obvious: electronic devices and water don’t mix well. The second thing is that the old “put-the-device-in-a-bag-of-rice-until-it-dries-out” trick doesn’t always work. However, if you wait long enough, you might also learn something about the American legal system…even if you were perfectly willing to accept responsibility for your waterlogged iPod.

A few years ago, our youngest son accidentally dropped his iPod into a bucket of water, so I’m not talking hypothetically here. We took it to the Apple store to see if it could be fixed. It couldn’t, and since it was our fault, we accepted it as one of those unfortunate things that happen in life. Case closed.

At least, I thought it was closed, but a lawyer somewhere decided that anyone who had an iPod that stopped working because it got soaked should be paid. He filed a class action lawsuit against Apple. Anyone who took an iPod to Apple for water damage during a certain time period was automatically included as a plaintiff in the lawsuit.

Now, Apple’s warranty clearly states that an iPod will not be replaced if it is damaged by water or other liquid, so I think the lawsuit should have been dismissed.  That apparently makes too much sense, however, and Apple was forced to rack up huge legal bills as it fought to defend common sense.  Eventually, as the case dragged on, the company decided to cut its losses and settle the case as so many other job providers are forced to do these days.

Not long after that, we received a check in the mail for over $100.  It was our share of the settlement money in a lawsuit we’d never heard about.  I didn’t want the money under those circumstances, though.  Even if Apple is making more money than virtually any other business in the world, fair is fair.

Unfortunately, after going to a website created to answer questions about the class action lawsuit, I learned that if I sent the check back, it wouldn’t go to Apple. Instead, it would go to one of these five groups:

  • Center for Auto Safety
  • Consumer Federation of America
  • Consumers Union
  • National Association of Consumer Advocates
  • National Consumer Law Center

The Center for Auto Safety?!  Why should it get any of this money? It makes no sense. However, it does have one thing in common with the other groups – it’s a darling of the trial bar.  You see, in more and more class action lawsuits these days, the trial lawyers aren’t the only ones who get a big pay day; groups they support that often file lawsuits against job providers can also win big, too.

How’s that for gaming the system?  Under rules approved by the judge, if I returned my check, it could very well go to funding another lawsuit against a company that had done nothing wrong.

Phooey on that. So, considering my options, I did what I thought was best.  I went straight to Apple and bought another one of their products, spending twice as much as the amount of my check and further adding to their record profits.

Do you have a story of class action lawsuit abuse, too?  If so, share it with us. Working together, we’ll increase public awareness of how this scam is making a mockery of personal responsibility in American courts.

Ebola Is Now In America, But What Many People Don’t Know About These Other Infectious Diseases Could Be Just As Deadly

vaccine needleIt’s almost impossible to turn on a TV news program these days without hearing about the growing Ebola crisis, but did you know there’s another infectious disease now spreading across America at a record rate? I bring this up for a couple of reasons: 1) many people aren’t aware of it even though it has serious public health ramifications, and 2) it’s partly rooted in an abusive lawsuit that went terribly wrong, and this blog was created to raise public awareness about how abuse of the civil justice system is affecting our lives.

The disease is measles, and according to the Centers for Disease Control and Prevention, there have been three times more cases of measles reported in 2014 than in any year since the disease was thought to have been eliminated in the US.

The obvious question is, “Why?” Don’t we have a vaccine for measles?

The answer is, yes, there is a vaccine, and it’s why measles was virtually eliminated in the United States 14 years ago.  However, something very disturbing happened around that time that many experts believe is largely responsible for the return of measles and other infectious diseases like whooping cough and chicken pox to our communities.

In 1998, a medical researcher working on behalf of lawyers suing vaccine makers manufactured evidence that he thought would help them win the case and bring them huge amounts of money.  To bolster the lawsuit, he claimed that he had found 12 children that developed autism after receiving vaccines.  The news spread like wildfire, and all of a sudden, many parents began to question whether they were doing the right thing by having their children vaccinated.  Some of them decided not to.

What they didn’t know, however, was that there was a big problem with the research.  That problem wouldn’t be revealed until 2011 when the British Medical Journal published a blockbuster report that showed the supposed “research” that sparked that fear about vaccines was fraudulent.  According to the Journal, “three of the 12, it turns out, had never been diagnosed with autism and others displayed symptoms long before they received vaccines.”

Daniel Fisher, writing for Forbes, pointed out at the time that the fraudulent research was tailor-made for litigation. “Science designed to serve the courtroom.” I highly recommend his column.

In the years since then, some news outlets have reported on the comeback of infectious diseases – like Time magazine did in this March, 2014 article — and have cited parents’ fears over vaccines as a major reason for the dramatic rise in these diseases.  However, in general, they have done a poor job of reporting why those fears arose in the first place and that the reason for those fears has been exposed as a fraud.

Dr. Paul A. Offit, the Chief of the Division of Infectious Diseases at the Children’s Hospital of Philadelphia, is one of the leaders in the medical community who is working to set the record straight.  He says dozens of studies have exonerated vaccines as a cause of autism, but too many people are unaware of these studies.  In his book, Deadly Choices, How the Anti-Vaccine Movement Threatens Us All, he delves deeply into other frauds that have been perpetrated and the terrible effect they have had on public health.

Many now fear that if the media doesn’t start reporting on this litigation-fueled fraud, more and more people will decide to forgo vaccinations because they only know half the story.  In the meantime, infectious diseases that we once thought were eradicated will continue to spread. Last year, US News & World Report revealed that in 2012, “the United States had the highest number of whooping cough cases since 1955” resulting in 18 deaths.

This is an epic tragedy considering all of the technology and medical research available today. As Paul Harvey would have said, it’s time for the rest of the story to be told.

Fears About Lawsuits Keep Revolutionary Traffic Safety Device Off The Market

Teens DrivingYou don’t have to be the parent of a teenage driver to have a special interest in any device that would make it impossible to use a cell phone while driving, but if you are, you’ll definitely want to know about this story. I strongly suspect it will also be of great interest to anyone who occasionally texts while driving and knows they should stop.

I fall into both of those categories, so I was especially intrigued to learn recently about a former engineer for NASA who has invented what many safety experts believe is the “holy grail” solution to distracted driving. I was also bothered (but not surprised) to hear why it’s not on the market after getting tremendous support from several key allies in this effort.

Scott Tibbitts is the engineer/entrepreneur who has worked on this amazing “gadget” for the past five years, and he and his company were recently featured in an article in the New York Times.  It’s a captivating story, beginning with his inspiration for ending cell phone-related distracted driving.  Tragically, a business executive with whom he was scheduled to meet one day in 2008 was killed hours before their meeting by a teenager who was texting while driving.

We all know that using a cell phone while driving can be extremely dangerous, and stories like that are too common.  In fact, every day, nine people die on American roads because of someone who has been distracted by texting, talking or emailing on a cell phone.  According to another story in Newsmax:

An estimated one in five crashes occurred through distracted driving, and 69 percent of drivers in the U.S. between the ages of 18 and 64 said they talk on their cell phones and 31 percent say they read or send text messages or email while driving, according to the CDC. This includes nearly half of all U.S. high school student drivers.

Safety experts have long searched for the perfect solution to this problem, but so far, the cell phone apps that have been created to stop distracted driving are not widely used and the state laws that have been passed to motivate drivers to do the right thing are regularly ignored.

So, when Tibbitts was able to find a way to use a “telematics” port found in all cars manufactured since 1996 to shut down phone use when a car is moving, he quickly drew the attention of these experts.  However, it was the attention and support he drew from some in the insurance and cell phone industries that led many to believe his device might finally be the perfect solution.

Tibbitts was able to convince insurance giant, American Family Insurance, to invest a significant amount of money in his venture.  He also got Sprint to allow his company to use its networks to stop texts.  It was the first time this had happened, so it looked like everything was lining up perfectly for the device to be brought to market.

Unfortunately, just when all of the technological hurdles were cleared, an old, familiar problem popped up to keep it off the market: lawsuit fears.

As the Times reports, Sprint executives worried about:

“what would happen if the technology let one text slip through, and someone reading the message became involved in a crash. That could be a financial liability for the company, and a tragedy. ‘If that one message does get through, and someone understood, “I bought this and I’ll be safe,” what does that mean for our brand and our business?’” said a vice president for business and product development at Sprint.

A spokesperson for Sprint now says: “It’s a matter of working out the legal issues. The legal uncertainty — that’s the major issue.” So far, the daunting legal hurdle is the only one they haven’t been able to clear.

It’s certainly not the first time that legal concerns have robbed American consumers of a wonderful product, but it is especially disturbing to hear that once again, an amazing invention could potentially save three thousand lives a year and prevent more than 300,000 injuries is stalled in its tracks because of lawsuit fears.

And The Winner Of The 2014 Wacky Warning Labels™ Contest Is…

IMG_1182…a label found on a cell phone battery booster.  It warns: “Get rid of children.”

What?? Is that a mistranslation, or is there something else going on with that label? I provide the inside story on that in an op-ed posted today on Townhall.com.

That label was selected as the grand prize winner of the Center for America’s 17th annual Wacky Warning Labels™ Contest by a studio audience during a recent taping of Stossel on the Fox Business Channel.  Congratulations to Larry Klein of Costa Mesa, California who won $1,000 for finding that label and sending it to us.

Second place and $500 was awarded to Mark Lengel of Novi, Michigan for a warning he found on a football helmet.  It warns: “No helmet system can protect you from serious brain and/or neck injuries including paralysis or death.  To avoid these risks, do not engage in the sport of football.”

That might not be as wacky as some of our previous winners like the warning on a baby stroller that says: “Remove child before folding,” but it was included as a finalist this year because it underscores how whacked-out the American civil justice system has become. Manufacturers now feel that they have to warn their potential customers to consider not buying their product despite the fact that it is tested and proven safe!

The third place prize of $250 went to Tim Weibel of Grand Island, New York. Tim found a label on a sheet of peel and stick decals he received from the Buffalo Bills. The decals look great on bike helmets, skateboards and scooters, but the label warns: “Decals are for decoration only and will not prevent you from any bodily harm or injury.”

Ever since announcing the winners on John Stossel’s show, we have been doing interviews around the country to: 1) have a laugh at the expense of the personal injury lawyers who make these labels necessary, 2) explain how the fear of being sued for injuries they didn’t cause is forcing product makers to put these common sense labels on their products, and 3) to reveal how the cost of all of these lawsuits has become a burden on American consumers and our economy.

Sometimes, we don’t know whether to laugh or cry when we see these warnings, but they help us raise public awareness of the litigation problem in America and get people talking about potential solutions.

Do you have a wacky label on a product lying around your house?  Keep your eyes peeled, because it could be our next $1,000 grand prize winner!