Where have all the summer internships gone?

college internsQuite a few college students across the country who earlier this year had dreams of spending their summer working at a rewarding internship are instead toiling away at fast food restaurants or other similar jobs.  Often, their disappointed parents want to know, “What happened?” They might be surprised at the answer.

First, let’s get one thing out of the way. There is nothing wrong with working at a fast food restaurant or doing other menial work. I spent my first two summers during college trimming Christmas trees in northern Michigan (no, those perfect shapes don’t come naturally) and working at a factory ripping up old wood pallets and then making a fence around the factory with the boards. I was thankful for the work. But in my later college years, I eventually got an internship, and it led directly to my first job after college.

Today, however, many college students won’t get that coveted internship before they graduate.  Some of their parents will wonder if the reason their son or daughter missed out on an opportunity to gain valuable experience in their field of study was because their grades were too low or their resume was lacking. What could they have done differently? Who else could they have talked to?

The sad truth is that in many cases, it’s Uncle Sam’s fault.

Last year while I was sitting in a back room at Fox News waiting to appear on John Stossel’s show, I noticed something different from previous years. I had been invited there six summers in a row, and I always enjoyed talking to the interns as I waited for my segment to be filmed.

And then, there were no interns.  I asked an assistant where the college students were and was told that the network had cut back on offering internships after a federal judge ruled that all interns in the private sector must now be paid. Knowing a little bit about how excessive litigation is changing America, it didn’t really surprise me, but what did surprise me was learning that those lawsuits were actually rooted in a little-known set of federal regulations.

John Stossel pointed me to a column he had written on the topic, and that’s when I learned that the US Labor Department under President Obama had changed the rules for what kinds of internships are allowed in the private sector. Now, unpaid internships in the private sector are allowed only if all of the following six criteria are met:

  • The internship, even though it includes actual operation of the facilities of the employer, is similar to training which would be given in an educational environment;
  • The internship experience is for the benefit of the intern;
  • The intern does not displace regular employees, but works under close supervision of existing staff;
  • The employer that provides the training derives no immediate advantage from the activities of the intern; and on occasion its operations may actually be impeded;
  • The intern is not necessarily entitled to a job at the conclusion of the internship; and
  • The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.

Read the fourth bullet point again. The employer can derive “no immediate advantage” from the intern. If you’re a student, would you really want an internship with an employer who gets no advantage from your activities? You’re supposed to work at internships to gain experience that will help you land a job someday.

On the flip side, as an employer, it’s virtually impossible to prove that you didn’t gain some advantage from the intern if, say, you get sued later on. Because, of course, that’s what happens now in America. Just ask TV personality Charlie Rose.

A few years ago, Rose was sued by some former unpaid interns who claimed they should have been paid.  He wound up having to pay them up to a quarter of a million dollars. Then, Harpers magazine was also sued. More and more employers were being accused of not complying with the federal regulations, and they were finding it hard to prove they got “no immediate advantage” from their interns.

Faced with this new reality, publisher Conde Nast simply decided to end its intern program. On the advice of their legal counsel, many others have followed. Recently, Steve Slattery, Executive Vice President of The Fund for American Studies, an educational non-profit organization that has placed thousands of students in Washington DC internships since 1967, said “many of the most prestigious entities have dropped their unpaid internship programs after years of enthusiastic participation.”

Put yourself in the shoes of an employer who has to explain to their employees who are now paying higher deductibles for their health care and who have gone too long without the pay raise they were expecting that you are now dedicating a portion of your budget to pay for a summer intern. It’s not hard to understand why so many internships have evaporated.

So, despite the fact that there are thousands of college students who would jump at the chance to have an unpaid internship, they’re just not there. As Bryan Caplan at the Foundation for Economic Education has pointed out, the federal government has made it virtually impossible for businesses in the private sector to offer the opportunities provided by unpaid internships. Parents who bolstered their resumes with an unpaid internship when they were in college must now understand that their children aren’t being offered the same opportunities.

Well, that’s only partially true. If the student is interested in politics, there are still at least two places that can still offer unpaid internships: Congress and the White House. Of course, they write the laws.

Originally published on Newsmax.com

Ballmer’s Website Is Welcome Straight Talk On Government Spending

SpreadsheetIt’s been three weeks since President Trump submitted his first budget to Congress, and the debate over whose programs will benefit the most or be cut the deepest has been, to say the least, intense. In this era of fake news, though, how do we really know if the information we’re seeing in the media that compares the proposed budget to budgets of the past is reliable? Quite frankly, it’s hard to answer that, but one option is to use a brand-new non-partisan website on government spending created by the former CEO of Microsoft, Steve Ballmer.

That’s right, the same man who helped give millions of Americans the spreadsheet they’ve used to do their monthly budget has just created a website called USAFacts.org to help us make sense of the federal budget. And it’s worth checking out because of something all of us non-billionaires share with this former business titan.

Despite being one of the richest men in the United States, Ballmer said that he had the same problem so many of us have had when looking for unbiased, user-friendly information about government spending: he couldn’t find a good source. But unlike most of us, the retired executive had the time and the money to do something about it, and that’s just what he did by developing USAFacts.

Want to know how defense spending has changed over the decades? It’s there. Want to know how spending on entitlements like Social Security and Medicare has risen or fallen during Republican and Democratic administrations? It’s there, too. How about the number of people who have taken advantage of the Earned Income Tax Credit since 1980? You’ll also find it there.

But this website offers a lot more than information on government spending. While you can see how spending on education has changed over the years, you can also see how the percentage of our population that has a high school diploma or a college degree has changed, too.  It provides immigration and border security information like the number of people who have been returned to their countries, and it will even tell you how much land has been used to grow crops each year over the past 36 years.

Ballmer reportedly got the idea for creating a one-stop-shopping website on government spending after helping his wife with her philanthropic efforts. After questioning why all our tax money doesn’t provide an adequate social safety net, he started thinking about what the government does with all our money. There wasn’t a single reliable source he could use to find out.

So, over the course of about three years, he has spent more than $10 million between direct funding and grants to put together what in the private sector would be called a “10-K” for our government. A 10-K is an annual report required by the U.S. Securities and Exchange Commission aimed at giving accountability to investors by providing a comprehensive summary of a company’s financial performance.

Ballmer said he wanted the project to be non-political, and one rule he said his team made early on was to use only government data — no outside providers. He says he wants to continuing building on it and hopes individuals and companies can use it to make customized reports to suit their needs.

According to InsidePhilanthropy.com:

“USAFacts employs researchers from the Stanford Institute for Economic Policy Research (SIEPR), the Penn Wharton Budget Model, and Lynchburg College. Those researchers draw on federal data sources to piece together a picture of government revenues, spending and activities, as well as national demographic trends. USAFacts breaks down spending by level — federal, state and local — to show, for example, that almost one half of government employees are educators managed on a local basis.”

Will this new project give you all the answers you want about government spending? It’s hard to say until you use it. However, the goal established for USAFacts came straight from the preamble of the Constitution. The website lays out four missions: “Establish justice, ensure domestic tranquility; provide for the common defense; promote the general welfare; and secure the blessings of liberty to ourselves and our posterity.”

USAFacts provides a valuable resource that can elevate the quality of public discourse in the months and years ahead. In an age where the term “fake news” has become a daily reminder of how important the facts are to every policy debate, this is a welcome addition.

Originally published on Newsmax.com

Image courtesy of ddpavumba at FreeDigitalPhotos.net

HHS Imposes 700 Million Hours Of Paperwork On Americans Each Year

paperworkEvery day, our world becomes a little more digital.  With more and more of us communicating by email, getting our news on phones and tablets rather than on newsprint, and paying our bills online, some believe it’s only a matter of time before we become a paperless society.

But I’m not holding my breath for that to happen.  While I use email as much as the next person and even buy most of my books electronically these days, there’s one major generator of paper that keeps chugging along: the government.

Ever since the enactment of the Affordable Care Act in 2010, also known as Obamacare, the United States Department of Health and Human Services has nearly doubled the amount of time it requires Americans to spend on paperwork. In 2016, HSS imposed an estimated 700 million hours of paperwork on us. That was up sharply from 412 million hours it imposed just eight years earlier.

Sam Batkins, Director of Regulatory Policy at the American Action Forum, has attempted to put those 700 million hours of paperwork into perspective for us. He says:

“it would take 354,500 employees working full-time in the private sector (2,000 hours annually) to complete a year of HHS paperwork. That is more than the population of Honolulu, Hawaii dedicated to regulatory compliance for HHS. To monetize this figure, assuming the average wage rate of a compliance officer, yields a burden of $23.1 billion.”

So, if the huge increases in your health care premiums and deductibles under the ACA haven’t been enough to make you sick to your stomach, the massive amount of time you’ve been spending filling out new HHS-mandated forms at home, in your doctor’s office and at work could have brought about another ailment: writer’s cramp.

However, as Betsy McCaughey points out in her book, What’s Ailing America, it’s not just health care consumers who are being forced to waste time filling out paperwork. All this paperwork is robbing doctors of the time they have available to spend with their patients.

She reveals that a 2014 ACA rule required doctors who take Medicare to report 18 different clinical measurements for each senior they treat. Regulators estimate that it could take as long as 108 minutes per patient to make the annual report.  All this time spent on new paperwork mandates, says McCaughey, is:

“time that could be spent treating patients, calling them to remind them to take their meds, or following up on their care. Instead, the labor is being confiscated by the federal bureaucracy to serve its own ends.”

Earlier this year, I reported here that complying with all of this red tape is not only taking our doctors’ time away from us, it’s stressing them out in a big way. A survey of 14,000 physicians from a wide variety of specialties found that more than half of them said they feel burned out in their job — a 25% increase from just four years ago. The number one reason for feeling burned out was listed as too many bureaucratic tasks. Paperwork.

Economists like to talk about the law of unintended consequences, and it’s time to recognize that the explosion in paperwork required by the ACA has had a major negative effect on health care. It may not have been intentional, but it’s very real and has far-reaching consequences.

Fortunately, that could be changing for the better in the months ahead. Now that Congress is tackling health care reform again, not only do millions of American stand to see relief in the form of lower health care premiums and deductibles, but in the form of a dramatically lower burden to fill out paperwork. That alone will be a huge relief to both patients and doctors.

Originally published on Newsmax.com.

Image courtesy of marcolm at FreeDigitalPhotos.net

“It’s About Bloody Time” To Cut Excessive Government Regulation

GregNormanGreg Norman may have retired from the PGA Tour in 2009, but he hit a hole in one recently when asked about Donald Trump’s efforts to cut government red tape.

During an appearance on Fox News, co-host Steve Doocy asked the Australian entrepreneur whose business ventures in the US include golf apparel, wine, restaurants and water parks: “What do you make of President Trump fulfilling campaign promises to roll back regulations to make it easier for guys like you in business to do business?”

“It’s about bloody time!” replied the Shark without hesitation.

Leave it to a straight-talking Aussie to tell Americans just how overdue we are for an overhaul of our bloated bureaucracy.

While many Americans have accepted an ever-expanding government as such an ordinary part of our lives that watching Congress pass more regulation is as predictable as watching the azaleas bloom in April at Augusta, others like Norman who are out there taking risks and creating jobs believe it’s time to prune back regulation.

To understand Norman’s passion on this issue, it’s important to understand just how burdensome the regulatory system in the United States has become. Only when we can comprehend the true cost of complying with government regulations can we fully understand why reform is needed so desperately today.

The Competitive Enterprise Institute estimates that the total cost of complying with all the federal regulations each year is a whopping $1.8 trillion. To put that into perspective, complying with regulations costs more than all the money the federal government collects from individual ($1.4 trillion) and corporate ($341 billion) income taxes combined.

And, if your big-government Facebook friends need more evidence that bureaucratic red tape has gotten too out of hand, there’s this: when you look at the value of all the goods and services produced by every country around the world, only eight countries have a GDP that exceeds the cost of regulation in the United States.

That’s right. If US regulation was a country, it would be the ninth largest country in the world!

It costs more for businesses, charities, associations and everyone else in the US to comply with federal regulations than the value of everything created in Canada (GDP of $1.78 trillion) in one year. Australia has a very respectable GDP of $1.45 trillion per year, too, but our regulatory burden looks like a whale compared the total economic output of the Shark’s native country.

When we understand the true cost of excessive government regulation, we can also begin to see it’s not just businesses that see this as a major issue but that teachers, doctors and many others want relief, too.

A national survey of public school teachers found that the percentage of teachers who perceive they have low autonomy in the classroom rose by a whopping 44% in a recent eight-year period. Teachers have less autonomy these days because of a myriad of new government regulations aimed at increasing student test scores and making schools more accountable.

Of course, everyone wants to raise student performance, but some experts believe that by placing too many regulations on teachers, government is choking their ability to be creative. A little less red tape governing how classrooms run could help schools retain the best teachers and attract new ones to the profession.

And doctors? When 14,000 medical doctors from a wide variety of specialties were surveyed to identify their levels of professional happiness, more than half of them said they feel burned out in their job. That’s a 25% increase from just four years ago. The main reason they feel burned out is that they have too many bureaucratic tasks.

When our physicians start listing bureaucratic burnout as their number one reason for being unhappy, that’s especially troubling. Doctors with a reduced feeling of well-being and satisfaction can have lower concentration, and that can lead to problems making the right diagnosis and other medical errors.

It’s time to cut the red tape. But if you won’t listen to me, listen to former President Bill Clinton’s golf buddy, Greg Norman. It’s about bloody time.

When Football Gave America A Lesson In Problem Solving

footballAnother football season has come to a close and, whether we like it or not, the focus of the sport will now shift from touchdowns and goal-line stands to what can be done to prevent more concussions and, ultimately, preserve the game in America.

Violence in football is a serious issue, and changes are needed in the game for the good of the players. Much has been written about the need to reduce injuries, especially head injuries, but it’s worth noting that excessive violence is not a new issue in football. As the NFL and other levels wrestle with this issue, it would do them well to look back at how football dealt with this problem at the turn of the twentieth century.

It may come as a surprise to many, but more than a hundred years ago, football was nearly banned because of carnage on the gridiron.  I learned about this after reading an excellent article on the subject in the monthly magazine, Imprimis, published by Hillsdale College.  In “Football and the American Character,” John Miller reveals that in 1905, eighteen people died playing football.  As he put it, the deaths…

“were not freak accidents as much as the inevitable toll of a violent game. And they horrified a group of activists who crusaded against football itself—wanting not merely to remove violence from the sport, but to ban the sport altogether. At the dawn of the Progressive era, the social and political movement to prohibit football became a major cause.”

Calls for the game to be outlawed came from major newspapers like the New York Evening Post as well as leaders in higher education, including the president of Harvard.  At the time, college football was the primary game in town when it came to the sport, and Harvard was one of the powerhouses.

However, the president of the United States at that time, Theodore Roosevelt, wanted to save football. Roosevelt was such a big fan of the game that he had gone out of his way to recruit football players when he put together the Rough Riders in 1898.  He believed football helped build character and was intent on saving it for future generations.

So, at the end of the grisly 1905 season, he brought together a group of reform-minded leaders in the sport to push for new safety rules, and they did just that.  According to Miller,

“football experienced an extreme makeover: The yardage necessary for a first down increased from five to ten. Rules-makers also created a neutral zone at the line of scrimmage, limited the number of players who could line up in the backfield, made the personal foul a heavily penalized infraction, and banned the tossing of ballcarriers. These were important revisions, and each was approved with an eye toward improving the safety of players.”

Their efforts greatly reduced injuries and even led to the creation of an organization that we know today as the NCAA.

I find this story fascinating, not just because I experienced my share of concussions while playing football in high school, but because of the fact that this entire controversy took place out of a courtroom.  There were no lawsuits. There were just highly motivated and creative leaders who came together to solve a major problem without being forced to by a judge.

Of course, lawsuits are a fact of life in America today and are sometimes needed to bring about change.  However, it’s not too naïve to believe that the leaders in the game can take a page out of Teddy Roosevelt’s playbook and implement changes where changes are needed. Americans pride ourselves on being a self-governing people, and the current situation in football is a prime opportunity to show the world that we still have the ability to, pardon the pun, tackle this major issue before we are forced to by a judge.

The Stella Awards and Frivolous Lawsuits

RV Senior Man - Thumbs UpEver heard the story about the guy who sued Winnebago over its cruise control? According to the story, he set the cruise control while driving and then left his seat to brew some coffee.  Of course, he crashed.  And, as the story goes, he was mad that the instructions didn’t warn him not to do this, so he sued.

If you’ve heard about this, you’re not alone.  It’s part of a viral email note about five crazy lawsuits that received the so-called “Stella Awards.”  The names and personal information about the five “winners” change from time to time, but the circumstances always stay the same. People around the world forward this email to me many times a year.

The awards are named after the woman who spilled coffee on herself and sued McDonald’s.  Her name was Stella Liebeck, and I’m sure that whoever started this award named it after her because if there is one lawsuit that everyone in America has heard about, it’s her infamous case.

The problem is, all the stories are fake.  That’s right, they’re urban legends.  It’s easy to believe them, though, because so many real lawsuits are just as outrageous.

While I’ve done my own research on this, the leading debunker of urban legends, Snopes.com, has also exposed this email as a fraud, and you can see their take on it here.  After revealing that the “Stella Awards” are pure fiction, Snopes also takes the time to point out that there is no shortage of outrageous lawsuits in the courts that are real.  Many of the real lawsuits they cite were brought to their attention by yours truly over the years.

Of course, there are a lot better places for information about how junk lawsuits are affecting America than through phony emails.  This blog is just one, and some of the ridiculous lawsuits we have highlighted include:

Some of my other favorite sources for information about ridiculous lawsuits include Overlawyered.com, AbnormalUse.com and CenterForAmericaTV.org.

The next time you see the Stella Awards email note, remember to check back here.  The lawsuits you will find us talking about on this blog and on the websites I just mentioned prove that truth is often stranger than fiction.


The Great Non-Debate: When George McGovern and Jack Kemp Got Together To Make A TV Ad

McGovern:Kemp TV adWith the presidential debate between Donald Trump and Hillary Clinton dominating headlines, let’s go back in time and take a look at a time when one of the most conservative presidential candidates of the past 50 years got together with one of the most liberal presidential candidates of the past 100 years to talk about the need to address an issue still plaguing America today.

The conservative was former Congressman Jack Kemp. The liberal was former US Senator George McGovern. They agreed on very little when it came to public policy, but that was before McGovern retired from politics and bought a country inn.

After McGovern retired and decided to run a business, he quickly learned how difficult it can be to keep up with government regulations and fend off personal injury lawyers who don’t like the way one operates. By 1992, he finally had enough and surprised his friends and foes alike by writing a column for the Wall Street Journal in which he explained all the problems he experienced. His inn eventually went bankrupt, and he blamed excessive government rules and regulations – the kind he supported in Congress – as big reasons for the failure.

He also blamed one other thing: frivolous lawsuits.  Even after the bankruptcy, he said “we are still dealing with litigation from individuals who fell in or near our restaurant.  Despite these injuries, not every misstep is the fault of someone else.  Not every incident should be viewed as a lawsuit instead of an unfortunate accident.  And while the business owner may prevail in the end, the endless exposure to frivolous claims and high legal fees is frightening.”

His friends in the trial bar were not happy with that column.  Nor were his former colleagues in Congress who relied heavily on political contributions from trial lawyers to finance their elections.  But McGovern wasn’t afraid to speak the truth, and job providers around the country rejoiced at having this unlikely ally speaking out on their behalf.

McGovern was so passionate about the harm done by excessive litigation that he also made a TV ad with Jack Kemp to urge Americans to join him in the fight against lawsuit abuse.  It’s one of my favorite political ads but was seen by relatively few Americans since it had a very limited run on the air. I obtained a copy when I became president of a Michigan-based legal reform group in the late 1990s and have posted it to YouTube here so you can see it, too.

George McGovern died shortly before before the last presidential election. Unfortunately, we’re still waiting for a political leader who is willing to tackle a problem that continues to plague everyone from inn owners and other job providers to non-profit community groups to this very day: lawsuit abuse.

Annual Contest Reveals What Wacky Warning Labels Say About America

There is a scene in the new “Finding Dory” movie by Pixar that shows a baby stroller with a label that warns not to fold the stroller before removing the child from it. Funny, for sure, and very familiar.  An observant movie-goer in the Chicago area knew immediately that the warning wasn’t simply a tongue-in-cheek joke concocted by Pixar, so she wrote to tell us about it.

It’s a real warning label featured in our popular Wacky Warning Labels™ Contest several years ago, and it just so happens that the movie recently debuted on the same day the winners of our 19th annual contest were announced.

ww16_lightsaberWarning labels that caution consumers about obvious, common sense things have become as much a part of life in America as the ever-popular Disney and Pixar movies. Of course, that’s where the comparison ends, but if you look around you, an argument could be made that wacky warnings are a more ever-present part of our life than any movie by any studio.  When’s the last time you saw a movie? Now, when’s the last time you saw a warning label? How about this morning!

If you counted every warning label you saw from the time you wake up to the time you go to bed, the labels would certainly include warnings on bathroom products, kitchen appliances, your car, bus, train, office products, and things you find in your garage. And some of them are downright silly. Have you ever looked at the silver scooter your kids or grandkids use (or which you used as a child, depending on your age)? Right there on the handlebar between the grips is a warning that says: “This product moves when used.” Really!

The Center for America, a non-profit organization that sponsors the contest each year, does so to highlight how our lives are changing by living in the most lawsuit-happy society on earth.  Labels like these are put on things all around us because product makers and retailers know if they don’t put these warnings there, they can be sued. Even if we already know what they’re warning us about.

One year, the makers of a popular wood router were sued by a man in Texas after he decided to use a tool meant for carpenters on his teeth and didn’t like the results. Now, he obviously should have known not to use a wood router to perform dental work. And the courts should have immediately dismissed his lawsuit. But that didn’t stop his lawsuit from moving through the courts and becoming a real pain for the product maker. That’s why the product user guide provided to consumers who purchased that wood router would later feature a new warning: “This product is not intended to be used as a dental drill.” Ugh.

The wackiest warning label of 2016 was found on a toy Star Wars lightsaber.  It says: “For Accessory Use Only. Not to Be Used as a Battle Device.”  Susannah Peate of Carmel, Indiana picked up the grand prize for sending that one to us.

Behind all of this humor is a serious point.  The lawsuits that are clogging our courts are piling costs on consumers and hurting our economy.

A study that compared America’s tort system with other countries revealed that if U.S. tort costs were comparable in size with other costs in other industrialized countries, we could save $589 billion per year for investment in new jobs and consumer spending.

There is certainly a place for legitimate product liability lawsuits. But we also need judges and policymakers to give personal responsibility and common sense a place in our courts again.  Just think if all the money we’re now spending on excessive litigation was spent on job creation or innovation instead. It would give a tremendous boost to our economy. Of course, we might not need labels like the one on a fishing lure that warns, “Harmful if swallowed,” but we’ll trade jobs for laughs any day.

Please read more at EpicTimes.com

Finalists In The 19th Annual Wacky Warning Labels Contest Announced

imageThe five wackiest warning labels of 2016 have just been announced as part of the Center for America’s 19th annual Wacky Warning Labels™ Contest. They are:

“For Accessory Use Only. Not to Be Used as a Battle Device.” A label on a toy Star Wars light saber. Submitted by Susannah Peate, Carmel, Indiana.

“Blades are sharp.” A label on a common utility knife. Submitted by Debbie Kronstain, Bentleyville, Ohio.

“In California, do not release outdoors or near electric power lines as it may cause power outages.” A label on a helium party balloon. Submitted by Connor Byrne, Walled Lake, Michigan.

“Do not hold over people.” A label on a glass coffee pot. Submitted by Connor Dial, Tyrone, Georgia.

– “Cycling can be dangerous. Bicycle products should be installed and serviced by a professional mechanic…Failure to heed any of these warnings may result in serious injury or death.” A label on a bicycle bell. Submitted by Bill Childs, Austin, Texas.

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, June 17 at 9:00 PM EDT 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!

Law Firm Mines Personal Info From Phone App Designed To Block Pest Calls

Cell phoneIf you are one of the thousands using a cell phone app to block pest calls and spam you may actually be unwittingly exposing yourself to further unsolicited calls. Not just any unsolicited calls, either, but calls from plaintiffs’ law firms using personal information culled from the app to drum up business.

This revelation was made recently by the US Chamber of Commerce Institute for Legal Reform (ILR) which uncovered the startling allegation while researching abuses of the Telephone Consumer Protection Act, or TCPA.

The TCPA was passed by Congress twenty-five years ago to eliminate unwanted telemarketing phone calls.  The law has helped cut down on some unsolicited calls, but anyone who has a cell phone knows the law hasn’t totally eliminated junk phone calls. The Federal Communications Commission receives tens of thousands of consumer complaints about unwanted – and, in many cases, illegal – phone calls and texts each year.

The TCPA has also given rise to a cottage industry of law firms that specialize in suing those who have allegedly violated the law. These lawsuits can be quite lucrative for plaintiffs’ lawyers, and unfortunately, whenever there is money to be made by filing lawsuits, there are often those who are willing to twist the law to unintended purposes to enrich themselves. As a result, the TCPA has resulted in a number of questionable high profile lawsuits in recent years, and those lawsuits have come under the microscope of the Chamber’s ILR.

One of those lawsuits was filed in 2012 against the Buffalo Bills football team. A class action lawsuit was brought against the team after it offered to send fans updates about the team if they signed up to get them. The team promised to send only five text messages a week. However, one week, the team sent six texts, and another week it sent seven. Their offense: sending three extra text messages over two weeks. As trivial as that might seem to most people, that case resulted in a settlement of $2.5 million – and the lawyers took home more than $500,000!

Spurred on by large awards like that, some firms are now scrambling to find plaintiffs who will agree to sign on as members of class action lawsuits, and some are allegedly using underhanded tactics to find their new clients. That’s where the smartphone app comes in.

While reading court filings that are part of a recent lawsuit filed against a law firm that specializes in TCPA lawsuits, the ILR found something very interesting and ironic.

A lawyer named Tammy Hussin who worked for a firm named Lemberg Law was sued by the firm for violating terms of a separation agreement. Hussin had left Lemberg in 2014 but apparently continued to represent some of the firm’s TCPA clients in California. The firm claims she failed to pay it for awards she collected under the agreement.

According to ILR, Hussin then countersued Lemberg, and that’s where things get very interesting.

She alleges that:

“the firm used information obtained through a cell phone app to file TCPA claims against businesses, without the individual’s knowledge or consent.

According to Hussin, the firm made a deal with PrivacyStar, a telephone application that identifies who is calling and why.  The PrivacyStar application allows users to file a complaint with the Federal Trade Commission (FTC) when they receive an unwanted phone call.  The FTC handles the National Do Not Call Registry and users were providing information to potentially stop telemarketing calls.  Hussin claims that PrivacyStar was providing Lemberg with the names and numbers of individuals who used the app to file a complaint.

What the users supposedly did not know is the Lemberg firm was trolling the data to seek out potential, and often unsuspecting, clients for TCPA litigation.

Ironically enough, the lawsuit alleges that the firm—supposedly seeking restitution for individuals inundated by unwanted calls—was itself pestering these app users with more unsolicited calls” (emphasis added).

Could PrivacyStar really be providing personal information about its customers to a plaintiff lawyer? A consumer reporter in Dallas by the name of Dave Lieber decided to look into the company even before these allegations were made and found some things he believes raise red flags about PrivacyStar.

According to Lieber: “Two of the company’s top executives are former execs at Acxiom, the highly secretive data collection company that keeps zillions of bytes of data on millions of Americans and sells that information to retailers and others willing to pay for it. Both Acxiom and PrivacyStar are based in Conway, Ark. Charles Morgan was CEO of Acxiom before he left. He is now CEO of First Orion, the parent company of PrivacyStar. Jeff Stalnaker, the PrivacyStar founder and current CEO, was division president at Acxiom.”

Lieber also discovered that the terms and conditions of PrivacyStar’s app: “allow the company to collect personal information including name, address, phone, email address, credit card information, mobile device information including ‘unique device identifier,’ marketing interests and ‘demographic information such as interests and ZIP code.’” In addition, he says the company’s policy gives it permission to share this information with third parties.

If the allegations Hussin has made against Lemberg Law are true, this case indicates that a popular smartphone app used by some people to protect their privacy may actually be sharing their personal information with at least one plaintiff lawyer.  It also illustrates the extreme measures some plaintiff lawyers go to these days to drum up business.

It sounds like what we really need is an app that can protect American consumers from overzealous plaintiff lawyers!

Please read more at EpicTimes.com.

Image courtesy of Stuart Miles at FreeDigitalPhotos.net.