Navistar Bus Recall

Navistar, the manufacturer responsible for MaxxForce brand diesel engines, school and commercial buses, trucks, personnel carriers and vehicle parts, has recalled multiple school bus models because of safety defects. Navistar is based in Fort Wayne, Indiana, and manufactures a number of heavy-duty vehicles for everything from construction and farm use to people and cargo conveyance. The BE and CE series buses are built by subsidiary IC Bus.

Navistar plans to initiate a recall for certain models year 2011 and 2012 IC RE school buses manufactured from February 4, 2010 until June 16, 2011 and 2011 and 2012 bus models IC RE made between August 24, 2010 and June 8,2011.  The National Highway Traffic Safety Administration (NHTSA) issued a report that these models have a positive battery cable that might rub against the hydraulic cooler reservoir-mounting bracket. This defect could lead to an electrical short, which in some cases could result in a fire. No information was given as to how many buses may be affected by this defect. The New York Times reported that up to 15,500 buses could be affected by this recall.

Navistar also plans to recall approximately 340 buses with model years 2011 and 2012 CE and RE manufactured from October 8, 2009 until April 14, 2011 because they were made without, or with improperly installed, floor channel reinforcements. This means the buses do not conform with seat back rear force displacements requirements and raise the risk of passenger rearward ejection.

In December of 2011, Navistar recalled certain model year 2012 International Durastar and IC Bus HC Heavy trucks and buses manufactured from February 10, 2011, through February 18, 2011, that were equipped with a Meritor MFS08 Series Non-Drive front steer axle. During the assembly process, the steering attachment bolts may have been insufficiently torqued. Insufficient torque of the steering arm bolts may result in bolt fatigue and fracture and/or arm separation, thereby potentially resulting in loss of steering control and increasing the risk of a crash. No injuries were associated with these recalls. Navistar plans to notify owners soon and work with them to repair the buses free of charge.

Our firm is currently investigating claims for those people who have been by a recalled Navistar bus. If you would like a free case evaluation, please contact Booth Samuels at toll free 1-866-515-8880 or at booths@pittmandutton.com.

Knauf CDW Proposed Settlement Agreement

The proposed settlement agreement with Knauf filed with the Court last week is a complicated document and many people are asking a number of questions about it. A majority of the questions I have been asked deal with the so-called “cash out option” from the uncapped fund.

The cash out option will not be determined by dollar-per-square foot. The homeowner will need estimates for remediation of their home. One will be done by Xactimate and the other by another contractor which can be Moss. Xactimate is basically a computer program where the contractor will plug in certain information particular to that home. They will put in bids for the home and the homeowner will be able to view the bids online. The homeowner can take the higher of the two bids or 65% of the Xactimate bid. Typically Xactimate is a much higher bid than the regular bid. The homeowner will get a cash out equivalent to the bid he chooses minus $4.50 per square foot. This subtraction is roughly the difference in the $8.50 per square foot move out lump sum for homeowners in the pilot program because the homeowners who select the "cash out" poption are not moving out to have their home remediated.

There are some requirements for the cash out option. One, there cannot be a mortgage on the home or if there is, the homeowner must provide a release by the mortgagee or lien holder. Second, the homeowner must record the existence of reactive CDW in the local property clerks’ office, if permitted by local law. Third, the homeowner must covenant to inform subsequent purchasers of the home of the presence of KPT drywall. There is specific language in the settlement agreement that they must state under oath. 

As far as an approved remediation plan, that information is located in Exhibit F, starting at page 179 of the agreement, found here: http://www.laed.uscourts.gov/Drywall/12-21-11.kpt.global.settlement.pdf

It is almost exactly the same as the pilot program remediation plan (which is a somewhat different plan than the plan laid out in the Hernandez decision). The main difference between this plan and the pilot program plan is that all appliances in homes under 3500 square feet are automatically replaced. For homes greater than 3500 square feet, appliances are replaced if signs of corrosion are found. The theory is that homes over 3500 square have higher-end appliances such as Vikings, and the cost to replace these items is significant if they are not damaged or appear compromised by CDW. This really comes into effect when getting a bid for the self-remediation aspect of the settlement and does not truly effect the protocol for remediating a home.

It is unclear right now what to do about homes that have KPT drywall on only one floor or in an added bathroom, bedroom, expanded kitchen, etc. That scenario is not clearly addressed by the proposed settlement agreement. I would suspect that the homeowner would have to get a bid to replace only those areas affected by KPT drywall and can get an approved contractor to do the work.

New Medicare and Medicaid Self-Calculated Final Conditional Payment Amount Option

As many of us who practice personal injury law know, the new Medicare and Medicaid laws regarding subrogation interests for a personal injury settlement are time consuming and strenuous to deal with. Many consider these laws draconian in nature because of the harsh penalties that can be handed down on the injured victims and their representatives for even minor mistakes or omissions. In practice, clients want to know why it is taking so long for the release of their settlement funds and become frustrated at us because the government is holding up the process. Even when a case is in an MDL and the attorney has the benefit of a special master and an ombudsman to help, the process is still daunting. However, it looks like there are some new mechanisms on the horizon that will hopefully help alleviate this process for everyone.

The Centers for Medicare & Medicaid Services (CMS) will be implementing an option that will allow certain Medicare beneficiaries to obtain Medicare's final conditional payment amount prior to settlement. This option is scheduled to be available in February 2012, for certain settlements involving physical trauma based injuries where treatment has been completed. Under this option, the beneficiary or his representative will calculate the amount of Medicare's conditional payment amount using information received from the Medicare Secondary Payer Recovery Contractor (MSPRC), the MyMedicare website, or other claims information available to the beneficiary. The MSPRC will review this amount and, if finding the amount accurate, will respond with Medicare's final conditional payment amount within 60 days. To secure the final conditional payment amount, the beneficiary must settle within 60 days after the date of Medicare's response.

In order to use this option, ALL of the following criteria must be met:

1. The liability insurance (including self-insurance) settlement will be for a physical trauma based injury (the settlement does not relate to ingestion, exposure, or medical implant- basically disqualifying this option for almost all mass torts cases);
2. The total liability settlement, judgment, award, or other payment will be $25,000 or less;
3. The Date of Incident occurred at least six months before the beneficiary or his representative submits his proposed conditional payment amount to Medicare;
4. The beneficiary demonstrates that treatment has been completed and no further treatment is expected either through a written physician attestation or by certifying in writing that no medical treatment related to the case has occurred for at least 90 days prior to submitting the proposed conditional payment amount to Medicare

Explicit instructions on how to use this process will be posted on the Medicare Secondary Payer Recovery Contractor's website at www.msprc.info by January 15, 2012. CMS will leverage existing processes to the greatest extent possible. This is an initial step to provide beneficiaries and their representatives with Medicare's conditional payment amount prior to settlement. CMS plans to expand this option as it gains experience with this process. Hopefully, this option will be expanded both in the types of injuries and the amount of settlement.

GLOBAL SETTLEMENT ANNOUNCED FOR CHINESE DRYWALL KNAUF CLAIMS

On Thursday in New Orleans, Judge Fallon announced at the monthly status conference for the Chinese Drywall MDL that a global settlement has been reached with Knauf (KPT).　The settlement will include all plaintiffs who filed claims against KPT prior to December 9, 2011.

The final settlement document is not presently available.　It will be made public and posted on the Court's website December 20, 2011.

The general terms of the settlement were described as follows:

The homeowner will have three (3) options to choose from.

1. The homeowner can participate in a remediation performed by Moss Construction (essentially the same settlement as the pilot remediation program); or,

2. A self-remediation with a "qualified contractor" of the homeowner’s choosing; or,

3. A pure cash-out option. The cash-out option will not include the $8.50 per square foot for move out cost. In addition, the cash-out option will be provided at a $4.00 per square foot discount from the remediation cost.

Finally, the settlement will create a $30 million "other loss," fund. Plaintiffs can make claims against this fund for economic losses caused by Chinese drywall as well as claims for personal injuries. The economic losses envisioned for this fund include those homeowners who have been foreclosed on or were forced into a short-sale because of toxic and corrosive Chinese drywall.

In addition, Knauf has agreed to pay attorneys’ fees and costs up to $160 million. This option will make homeowners whole because attorney’s fees will not be taken out from this option.

There will be no details of the settlement until the settlement documents are released on December 20, 2011. A preliminary settlement approval hearing will be held on January 4, 2012. After that, it is anticipated that a fairness hearing will be held in front of Judge Fallon sometime in either June or July of 2012.

For those homeowners whose claims are already in the pilot remediation program, this settlement should have little effect on that process moving forward.

ACTOS LAWSUIT UPDATE

Actos, a prescription drug designed to help diabetes patients manage their blood sugar levels, is one of the best selling drugs in the United States, bringing in over $2.4 billion dollars in sales. Hundreds of thousands of people worldwide have taken Actos, but many may be unaware of the increased danger of bladder cancer that long-term usages of Actos can bring.

In early testing, Actos was found to provide only a small increase in the chance of contracting Actos bladder cancer while taking the drug. However, in September 2010, the FDA announced that Takeda Pharmaceuticals, the manufacturer of Actos, provided interim data spanning five years that suggests there may be a risk of bladder cancer the longer the medication is used. After 24 months, the rate of exposure and the increased Actos cancer risk reached statistical significance. In June 2011, an Actos recall was issued in France after health authorities ordered doctors to stop prescribing the drug due to the possible risk of bladder cancer.

Germany has also pulled the drug completely off of the market. The sale of Actos is still allowed in the United States at this time, but the FDA has issued a warning about the product and the risk of bladder cancer. The FDA has also ordered the manufacturer to change the wording on the drug’s warning labels. Despite the enhanced warning labels on the drug, this does not mean that patients who have contracted Actos bladder cancer after taking Actos long-term to treat their diabetes cannot file an Actos lawsuit.

Because of these new findings, dozens of Actos lawsuits have been filed by people seeking redress for their injuries. A class action lawsuit has recently been filed in Louisiana against Takeda pharmaceuticals claiming that information about the danger of Actos bladder cancer was suppressed or hidden from the general public. The Actos lawsuit also alleges that the manufacturer had significant financial incentives to try and prevent the spread of the information.  In general, anyone who was prescribed the drug is a potential class member of the Actos lawsuit, even if they did not contract Actos bladder cancer while taking the drug.

A motion was filed by plaintiffs’ lawyers in August to centralize the federal litigation over bladder cancer from Actos into an “MDL”. An “MDL”, or Multi-District Litigation, is a powerful tool useful in mass torts litigation and I have blogged extensively about the benefits of the procedure. Pittman, Dutton & Hellums has represented many injured plaintiffs in a number of MDL’s including In re: Total Body Formula, In Re: Chinese-manufactured Drywall and In re: DePuy Orthopaedics, Inc. ASR Hip Implant.

Although Takeda Pharmaceuticals has indicated they agree the lawsuits should be consolidated for discovery and pretrial proceedings, they disagree about where the cases should be centralized. The U.S. Judicial Panel on Multidistrict Litigation heard oral arguments for a motion for centralization of the Actos lawsuits on December 1, at their hearing session at the Tomochichi United States Courthouse in Savannah, Georgia. All lawsuits allege that defendants, including Takeda Pharmaceuticals, were negligent and failed to warn of the risks associated with the medication. The motion for the MDL was filed on August 31 by plaintiffs Glen and Nina Weant. Our firm filed a brief advocating for the MDL to be located in Birmingham, Alabama.

As a patient who was prescribed Actos, either for diabetes glucose management or any other reason, you need to be aware of the increased risk of Actos bladder cancer that taking Actos brings. If you have Actos bladder cancer, or believe that you may have Actos bladder cancer, please contact me at booths@pittmandutton.com or call toll free 1-866-515-8880.