AIR noted back then:

Hundreds of thousands of policyholders in high-risk areas [were being] dumped into the post-[Hurricane] Andrew state-run “insurer of last resort.” The company, Citizens Property Insurance Corp (the result of a merger between Florida Windstorm Underwriting Association and Florida Residential Property Joint Underwriting Association) has seen astronomical rate hikes. And while policyholders in high-risk areas are dumped into this system, private insurers keep the lower risks for themselves. Said [Bill Newton of the Florida Consumer Action Network], “The state high risk pool takes the windstorm risk in those areas, and the insurers just take the balance of the risk [in less risky areas]. That deprives the state of the profits from the more lucrative part of the business.” Citizens now faces a $1.8 billon deficit.

Look, we have some sympathy for the position the private insurance market has put Citizens in. If you read Tipping Point, you will see very innovative solutions to this mess. But our sympathy only goes so far. Wait ‘til you hear this.

Apparently, according to a lawsuit just filed against Citizens (asking for class action status), Citizens “uses a computer program called Value360 to calculate the ‘replacement cost’ for homes if they are damaged or destroyed, a figure that determines how much coverage a homeowner has to buy on his house. According to the lawsuit, the program churns out cost calculations that are as much as double what the homes are actually worth – resulting in skyrocketing premiums.”

Joe Freitas, a New Port Richey man who is the lead plaintiff, bought a house for $109,000 in 2011. When he and his wife closed on the property, they had a policy that covered $139,000 in damages and cost $917 per year. But 30 days later, their insurance agent said Citizens would not insure them unless they paid for a $236,700 policy – with a yearly premium of $1,846. "It changed the way we were going to live our lives," Freitas, 44, said at a news conference.

Ruth Lauro, an 82-year-old Citizens' policyholder also from New Port Richey who lost her job in October, said she's in the same boat. Her house, which attorneys said was worth $50,000, was given a replacement value of $125,000. Lauro, whose only income is $637 a month from Social Security, said she's having trouble making ends meet. "I'm tired of eating rice," she said.

The suit is filed against both Citizens and Utah-based Xactware Solutions, which created the Value360 program. What else do we know about this Value360 program?

Well, as reported by the Orlando Sentinel over the weekend,

Value360 is an estimating software program sold by Insurance Services Office. Rebuilding costs determine how much coverage a homeowner has to buy for the main structure of the home, the largest part of a typical policy.

Mike Fulton, an assistant vice president of the ISO subsidiary that produces 360Value, said the scrutiny is welcome: "We are confident this review will ... show that 360Value is the most closely aligned with the actual insurance-repair market."

Americans for Insurance Reform, a national coalition of consumer advocacy and nonprofit groups, recently produced a report that criticized regulators for allowing insurers to base rates on data from ISO, alleging it's "industry-controlled" because it was formed by the industry before spinning off into a private company.

(That AIR report would be here.)

Citizens is supposed to offer ‘affordable property insurance’ to homeowners when private insurers are unwilling to do.  Clearly, like the rest of the insurnce industry, Citizens has lost its way.

Now that the federal government and some state governments are apparently trying for a “global settlement” with BP in advance of the big February 27 trial date, I hope they keep that in mind.  According to reports, such a settlement would “resolve federal civil fines under the Clean Water Act, Endangered Species Act and other laws; compensate federal and state governments for damages to natural resources; and settle any criminal violations as well."

But no matter what the governments do, the committee of lawyers representing more than 100,000 individuals and businesses suing for compensation and punitive damages say they’re going to trial.

And even if some of those claims are small or difficult to prove, says one expert, “even a small group of strong plaintiffs could easily have claims totaling $1 billion.”  Plus punitive damages.  

Let’s hope for that!

For more about what’s coming up in the case, click here.

For example, this week in New York City, the city council held a hearing about OB/GYN shortages in certain underserved urban areas.  Every other word from the councilmembers was “insurance” - as if price-gouging of these doctors was somehow preordained.  Of course, nothing could be further from the truth, as states like Illinois and California have shown.  (For more, see CJ&D's testimony here.) 

Yet no one from the industry appeared, no councilmember thought to blame or even question them, and no one seemed to care that when it comes premiums and claims data, New York State is one of the least transparent states in the nation.  New York’s insurance laws are so bad that medical malpractice insurance companies basically disclose nothing to lawmakers or the public that could substantiate or refute their allegations about the financial health of the industry, why doctors are being charged certain premiums, or the impact of New York’s civil justice system.  Meanwhile, public officials are asked to make policy recommendations based on outlandishly inaccurate information that cannot be analyzed by anyone except the industry’s own paid consultants. 

So cudos to some smart Oregon lawmakers, who this week said, “wait a minute” to the “tort reform” politicians.  Gov. John Kitzhaber says he’s pushing back until 2013 consideration of tort restrictions in medical malpractice cases, like “caps” on damages (which, by the way, are unconstitutional in Oregon) until a few more things can be studied.  And among those things, hopefully, will be the insurance industry’s role in all of this. As Felisa Hagins, political director of SEIU Local 49, put it:

“I’ve also heard that malpractice insurance itself is the problem, and we don’t have a proposal to deal with the sideboards of insurance itself such as rate review, how money is transferred, how medical malpractice is sold in the state. I feel like we have to address that in some way,” perhaps, she added, similar to the way insurers are required to undergo rate review by the Insurance Division when filing rate hikes for individual and small businesses.

Now, let’s hope the lawmakers get there, too.

According to a 2010 wrongful death lawsuit filed against him by the parents of the late 23-year-old engineer Scott Wilson,

Goodman became falling-down drunk and took drugs shortly before he hopped behind the wheel of his 5,500-pound black Bentley convertible in February, causing a wreck that killed … Wilson.

William and Lili Wilson also sued the Players Club bar, a popular night spot in Wellington's equestrian community, alleging that employees there kept serving drinks to Goodman even though he was a known alcoholic who was "obviously drunk" that night.

After the collision, the parents allege, Goodman ran away, tried to hide and attempted to call friends and lawyers who could shield him from prosecution - rather than rescue Wilson, who was drowning in a canal.

By the time Goodman turned himself in, the suit says, "it was far too late for any rescue."

Oh, but that’s hardly all.  If you caught the Today Show this morning, you would have learned that to protect his assets from the parents of the person he allegedly killed, Goodman has now legally adopted his 42-year-old girlfriend Heather Hutchins.  And as Today reported, “Now that Goodman’s girlfriend is his daughter, she’s immediately entitled to a third of his money.  The other two thirds belong to his two biological children.”

“I was flabbergasted to learn of it,” said the family’s attorney, Christian Searcy  who appeared along with the family’s other attorney Scott Smith.  Said Scott Wilson’s mother Lili, “This is very difficult, not knowing what happened, not knowing if he could have been saved.”

Palm Beach County Circuit Judge Glenn Kelley had previously ruled a trust fund Goodman had established for his two minor children could not be considered an asset in any court-rewarded damages to the Wilson family. Now, with Hutchins also considered Goodman's daughter, she is entitled to one-third of the trust fund, and as an adult over 35 she can begin drawing money from the fund immediately.

And because she’s not a close blood relative, he can still have “relations” with his brand new daughter and it’s all legal (at least until the probate court rules on this). (Although “relations” may be on a fast track to nowhere as “Goodman faces criminal charges of DUI manslaughter, vehicular homicide and leaving the scene of an accident that carry a possible 30-year prison term in a trial set for March 6.”)

Visit msnbc.com for breaking news, world news, and news about the economy

Yet clicking through stations the other night, there was Erin Brockovich on HLN’s Dr. Drew Show!  And she was breaking some “stunning” news (as Dr. Drew put it) about what might be causing the terrible Tourette's like symptoms hitting teenagers in Leroy, NY, which until now many have blamed “conversion disorder, or mass hysteria.” 

But now we find out, as reported on Dr. Drew, that a1971 train derailment very close to where these kids go to school caused cyanide and 45,000 gallons of TCE to spill, and which was never cleaned up.   Erin's team went to Leroy to start taking soil samples at the school – but were sent away. 

Here’s some of what they told Dr. Drew:

HLN CORRESPONDENT JIM SPELLMAN: In that statement, Superintendent Kim Cox said the school district had hired an environmental consulting firm to review previous test results. But after being denied access to school grounds, [BOB BOWCOCK, ENVIRONMENTAL INVESTIGATOR] remains skeptical. 

BOWCOCK: I will tell you that usually in settings or situations like this when I`m confronted by officials barring access to something, they usually have something to hide.

SPELLMAN: After taking some water samples at nearby residences, Bowcock headed to the derailment site where in 1970, over 30,000 gallons of toxic solvent TCE spilled after a train went off the tracks. Bowcock said he was surprised to find an untended cleanup site, some of the storage drums were leaking and corroded.

BOWCOCK: But what they`ve done is they`ve left 55 gallon drums of the soil, when they drilled the monitoring well, the contaminated soil came up because if you put it on (ph) on a drum, it should go to a hazardous landfill.

It`s so - it`s so hazardous that they had to put this berm in to protect the stuff from spilling back out. You have a sign like that, and 55 gallon drums rotting away, leaking material out into the environment right now, draw your own conclusion.

 …

PINSKY: And Erin keeps telling me this is a big deal. This is something unlike anything either she or Bob has ever seen in their career. Tell me why.

ERIN BROCKOVICH, ENVIRONMENTAL ACTIVIST: Well, for some of the reasons, I mean first of all, for a couple of factors. I mean it took agencies so long to respond to a spill.

PINSKY: Twenty-five years.

BROCKOVICH: Twenty-five years.

PINSKY: So was there leeching of the spill for 25 years?

BROCKOVICH: Absolutely.

PINSKY: There’s documentation of wells being contaminated during that time.

BROCKOVICH: Absolutely.

PINSKY: People are getting jugs of water sent to them so they don’t drink the well water by the railroad company.

BROCKOVICH: Absolutely.

PINSKY: And then when they finally do respond, Bob, you say the site itself has been rendered into a toxic dump?

BOWCOCK: Oh, absolutely. They`ve gone in and excavated some of the materials to do their testing, put it in 55 gallon drums and left in there to rot and just go right back into the environment.

PINSKY: OK. So are we - are we saying that - I just want to add up the score. Summarize it for me, Erin, if you could, that this is an extraordinary situation. Bob, the dump site is unlike anything you’ve seen where the remediation site has become its own toxic spill.

BOWCOCK: Yes.

The EPA says there’s no connection to the train derailment.  Others say, "if this spill happened in 1971, why are we only see health problems now?"  Brockovich responded: 

BROCKOVICH: But very quickly just to share with you what people are reporting to me from the area, they are reporting that they grew up in that area and they`ve seen and they know of dumping. They’re reporting as adults now that as children they were told not to drink the water in or around the ball field.

I have people reporting to me who grew up in the area whose sons have tics, who were born with rare birth defects. I have children who grew up in the area who are reporting to me they had bone cancer at the age of 10. I have children who grew up in the area who are reporting to me as young adults in their early 20s that they`ve been diagnosed with acute lymphatic leukemia.

I`m getting reports from people who still live their on Maple Avenue, that there’s eight known families with very rare cancers, moving on to Erie Street, there’s more cases of cancer being reported. I have people reporting to me that their two and a half-year-olds have tic-like syndromes.

PINSKY: I`m going to stop you because we can’t substantiate this, but we get - we get the idea.

BROCKOVICH: Right. I understand. And these are all reports that we are clearly substantiating as well.

But I want something that people to understand for 21 years that I’ve been doing this, these people who come from these areas, they’re the first not to panic. They want answers and they’re reporting information to me that can help us get answers for these 12 girls, for them, and for the community as a whole.

These people have a lot better things to do in their life than sit around and make up these symptoms that can be clearly substantiated and send them to me. So what it`s telling us is that, yes, the 12 girls are exhibiting problems, but yet many other people are as well.

PINSKY: It may be the tip of the iceberg.

BROCKOVICH: Right.

HLN, I’ll be watching.

Like for example, take the McDonald’s coffee case portrayed in the award-winning film Hot Coffee, which we wrote about most recently here.  Some “tort reform” folks keep trying to re-argue it, presenting a case that the jury didn’t believe, a case that the judge and jury both rejected, and which led the judge, in refusing to grant a new trial in the case, to call McDonald's behavior “callous.”  (Like here, here.)  Soon I expect to start hearing them say the hospital pictures of Stella Liebeck’s third degree burns and skin grafts were photoshopped.  (As the film also notes, McDonald’s was selling coffee  as hot as a car radiator.  That’s right, a car radiator.  And by the way, the coffee being sold was as hot as a car radiator.  And also by the way, if you're over the age of 25, you may recall how flimsy those McDonald’s cups used to be.  You could stick a finger right through them and if the coffee was too hot, the cup could collapse in your lap.  Which is what happened to Stella.)

So now let’s move on to another insanity this week.  The insurance consulting firm Towers Watson is issuing, once again, their pretend “cost of the tort system” report.  They have tried this 15 times already.  We’re convinced that one day, they must truly believe that one of their reports will actually reflect “the costs of the tort system.” Not yet though.

Here’s what we said about them last year: 

One of Towers Watson’s favorite things is to speculate based on nothing.  Expect “significant increases” in tort costs next year, they say.  Last year, it predicted this increase based on rubbish like the likelihood of future inflation and President Obama’s federal judicial appointments, none of which came to pass.  Their own figures decreased.  You'd think that would be embarrassing enough to keep them from making more bogus predictions but it hasn't.  They're doing it again. 

No matter that the company itself admits that its figures have nothing to do with the costs of the legal system like jury verdicts, settlements, lawyers’ fees or any actual costs of what might generally be considered the “tort” system, or that it examines only insurance losses whether or not a lawsuit was even filed, (think “fender bender”) plus insurers’ “guess” (historically, widely overstated) of what future losses could be, plus all of the industry’s bloated overhead (salaries, bonuses, lobbying costs, jet planes etc.).  Plus, they cite themselves for much of the data, and don't disclose them. 

So in order to find any kind of “increase” this year (since actually the costs were down even by their own definition), they were forced to include predictions about the costs of the 2010 BP oil disaster - even though the court trial hasn’t even started.  Even the Gulf Coast Claims Facility has paid only about $6 billion of the $20 billion BP promised to pay victims.  And this is what’s giving rise to an 5.1%  increase in the cost of the entire U.S. tort system?  Just so Towers Watson can then scare Americans into believing they are somehow paying for this?  Wow, that is some good news for BP! 

Here’s exactly what Towers Watson says:

The April 2010 Deepwater Horizon drilling rig explosion and resulting oil spill in the Gulf of Mexico were the key drivers in the 5.1% increase in U.S. tort costs in 2010, according to the 2011 Update on U.S. Tort Cost Trends from global professional services company Towers Watson (NYSE, NASDAQ: TW). Absent the costs from that event, tort costs would have shown an overall decrease of 2.4% for the year, the findings indicated.

In total, the U.S. tort system cost $264.6 billion, which translates to $857 per person, versus $820 per person in 2009. Personal tort costs totaled $96.7 billion; commercial tort costs were $168 billion. The 2011 report analyzes U.S. tort costs from 1950 through 2010, with projections through 2013.

We’d like to recommending some counseling.  Call us.

On the other hand, Toyota’s downfall was clearly a big factor in GM’s rise to #1 again.  And while most of this is attributable to the Japanese tsunami, Toyota – and the National Highway Traffic Safety Administration - continue to battle with auto safety advocates over still-lingering questions about the very odd sudden acceleration problem and the company’s response.  

Reports the New York Times, Safety Research and Strategies has filed a Freedom of Information Act lawsuit against NHTSA trying to find out if the agency has been withholding information “that may depict an acceleration incident caused by electronic systems in a Prius instead of the floor mats or pedals covered by Toyota recalls.”  Specifically, they’re seeking “transcripts, recordings, photographs and videotapes generated by a visit of two federal investigators to the home of a senior government official who had complained about sudden, unexplained acceleration of his own Prius,” which happened several times on one 200-mile trip!

“The engine started to rev — actually almost roaring — and the vehicle picked up speed,” he said.

He noted that the accelerator pedal was neither stuck nor constrained by the floor mat. “The floor mat wasn’t up against the accelerator pedal,” he said. “I put my toe up against the back of the accelerator pedal to see if it was stuck. It was not stuck; it was fully up.”

NHTSA has dismissed all concerns that sudden acceleration incidents have been caused by electronic systems, as has the National Academy of Sciences.  However, as the Times notes, NAS also “concluded that federal regulators were ill equipped to detect problems in the increasingly complex computer systems of modern automobiles.” 

 “This is all about transparency,” said Sean Kane, co-founder of Safety Research, an auto consulting firm in Rehoboth, Mass. “This is an agency that selectively releases data that fits its narrative that electronics are not at fault in sudden acceleration.”

Hope they get what they need.

He’s been criminally charged and will soon be sentenced “on two counts of assault and battery, three counts of larceny, five counts of Medicaid fraud, three counts of illegally prescribing controlled substances and one count each of tampering with evidence and witness intimidation.” 

Interestingly, his license to practice had been "previously revoked in Maryland, Florida and West Virginia” but Massachusetts let him practice even though he had “been prohibited from doing work on Medicaid patients.”  (This allowed him to hire dentists and use their Medicaid identification to file claims.)

Mr. Clair has been free on bail since his arraignment April 8, 2010, and how he’s moved to Maryland – one of the states where his license was revoked.  And it’s a good thing too, cause Maryland doesn’t need any more bad dentist publicity since the tragic death last year of a teenager who died during routine wisdom tooth surgery.  The family has now sued the oral surgeon and the anesthiologist for medical malpractice.

The family is hoping “to highlight the surgery's risks and the need for better emergency training among dentists and oral surgeons.”

According to Jay Friedman, a California-based dental consultant and author:

American dentists and oral surgeons pull 10 million wisdom teeth each year -- an effort that costs more than $3 billion and leads to 11 million days of post-operative discomfort, according to the report.

“At least two thirds of these extractions, associated costs, and injuries are unnecessary, constituting a silent epidemic of [dentist-induced] injury that afflicts tens of thousands of people with lifelong discomfort and disability.”

Jeepers.

We’ve never properly honored McDonald’s for the way it handled this case, so today, we’d like to invite all PopTort fans to show McDonald’s exactly what you think of them by tweeting using their brilliant hastag #McDStories.  As the Huffington Post reports today, the company started this hashtag as a company promotion, but from there, hilarity has ensued!

Negative tweets about the fast food giant began to proliferate, prompting the New York Observer to remark that "some stories are better left untold." Tweets ranged from tweeting about being high while eating McDonald's to throwing up the food.

If you agree with us that seriously injuring their customers and then viciously fighting them in court is at least worthy of a tweet, then please add your thoughts.  #McDStories!  And the go get yourself a Hot Coffee DVD.

UPDATE:  Yup, that's right.  As hot as a car radiator. 

That’s because it’s Occupy the Courts day, as people in cities across America occupy courthouses “in a show of protest against the two-year anniversary of the controversial Citizens United ruling.”  Learn more here.  Writes Politico:

“Why the courts? Because frankly folks, that’s the scene of the crime,” said David Cobb, an organizer of Friday’s protests. “Corporate personhood and money equals political speech are court-created doctrines. We the people never decided it; our elected representatives didn’t decide it; ordinary people like me and you never decided it. The court created these doctrines and it’s going to take a movement to overturn it.”

They’ll be lots of demonstrating at the U.S. Supreme Court, that's for sure, which by the way just threw out “electoral maps drawn by federal judges in Texas that favored minorities.”  My, the good news from this Court just keeps comin'!  See more background here.

And speaking of being thrown out, New York’s courts have done the same to the Occupy the Courts permit request itself, keeping demonstrators from coming near NYC’s federal courthouse.  So it’s back to Zuccotti Park!  For everyone else, go here to find out where Occupy the Courts is in your city today.