More on $17 Million Jury Verdict involving skidder obtained by Pittman, Dutton, Kirby & Hellums, P.C. attorney David Hodge

Pittman Dutton Kirby & Hellums, P.C. attorney David Hodge of Birmingham, along with Vance McCreary of The Gardner Firm in Mobile and James (Jimmy) Seale of Greensboro recently tried and received a verdict in the Circuit Court of Hale County in the amount of $17,559,700.

PDKH represented Charles Miller Chapman against Cummins, Inc. and Bama Logging Equipment Company, Inc. Chapman made claims of Fraud and Breach of Warranty involving the sale of a skidder- a large piece of equipment used to drag cut logs from the woods to a loading area where they can be loaded onto a log trailer.

Chapman claimed that he was sold the defective skidder alleging it was a “demo” unit when in fact it was a one-of-a-kind developmental prototype that had an engine manufactured and produced by Cummins. Cummins had internally determined the engine would not work in this prototype.

Chapman alleged that Cummins, Inc. knew the engine was not suitable for use in this piece of equipment and even before the machine was assembled, Cummins, determined the Tier II engine would not work in this configuration. No one disclosed this to Chapman. In fact, Cummins, Inc., provided Chapman with a warranty despite knowledge that the engine could not perform in that configuration.

This case was tried by Pittman, Dutton, Kirby & Hellums, P.C. shareholder David Hodge. David can be reached at davidh@pdkhlaw.com or toll free 866-515-8880.

Debt Solutions companies under attack by authorities

Debt settlement companies are for-profit companies that claim that they can eliminate consumers’ debts by negotiating settlements with creditors that are a fraction of the consumer’s outstanding debt. If you watch television these days, their advertisements show up as often as those for drug companies. Many of these companies accomplish very little for consumers while charging exorbitant fees and make empty promises that leave consumers in worse financial state then when they began.

These debt solution companies prey on desperation, offering false hope and no help, often driving these consumers even further into debt and ruining their credit.

Some debt solution companies advise consumers to do one of the following:

1. Stop paying debts

The Problem: this causes customers to face unforeseen late fees, additional interest, increased collections attempts, and even lawsuits by their creditors.

2. Stop paying debts and, instead, to place money into savings account so that enough money will accumulate to allow a settlement offer to be made to any creditors.

The Problem: The debt settlement companies’ saving plans are often extremely unrealistic, so that the promised negotiated settlements do not occur, but the debt settlement companies’ still take their fees.

Also, the debt settlement plans are generally premised on consumers aggregating savings, over one to three years, from which both the payment of the company’s fees and any negotiated settlement are to be made. Yet most consumers who are targeted by these companies are unable to meet the savings requirements because of their precarious financial situation.

3. Ignore collection efforts or refer those efforts to the debt settlement company.

The Problem: it doesn’t work and consumers continue to find themselves subject to creditors’ collection efforts, including lawsuits, and consumers’ credit histories are further damaged when the consumers stop paying debts.

4. Seek additional sources of funds through means such as selling their blood plasma, mowing lawns, cutting down on car insurance and borrowing from their neighbors and church.

The Problem: Even for those consumers who can meet the requirements set out by a plan, their amount of aggregated savings is ordinarily insufficient to settle their debts. As a result, many consumers find themselves worse off financially because of these debt settlement plans.

I suspect that much litigation will arise against debt settlement companies who engage in this type of conduct.

To read more about the actions being taken by the New York Attorney General, see here (http://www.oag.state.ny.us/media_center/2009/may/may19b_09.html)



Chris Hellums may be contacted at ChrisH@PDKHLAW.com

More on Hydroxycut

Hydroxycut was recalled by the U.S. Food and Drug Administration (FDA) on May 1, 2009. The different varieties of Hydroxycut (powders, pills, liquids) have been related to severe liver damage, including liver failure. At least 23 people that have used the recommended doses of Hydroxycut have reported suffering severe liver damage and other injuries such as seizures, cardiovascular disorders and rhabdomyolysis, a severe form of muscle damage that can lead to kidney failure.

Hydroxycut products were sold across the United States at fitness retail stores, GNC stores, Rite-Aid, Vitamin World, Vitamin Shop, Bally Total Fitness, and other outlets. The products are not classified as drugs and have not been evaluated or approved by the FDA. The FDA urges consumers to discontinue use of Hydroxycut products in order to avoid any undue risk. Adverse events are rare, but exist. Consumers should consult a physician or other health care professional if they are experiencing symptoms possibly associated with these products,” said Linda Katz, M.D., interim chief medical officer of the FDA’s Center for Food Safety and Applied Nutrition.

PDKH is currently representing Hydroxycut victims. Contact attorney Mike Bradley at MikeB@PDKHLaw.com if you have any questions or would like to schedule a consultation.

What is going on with Juries these days???

In the last 6 months, our firm has obtained four multi-million dollar verdicts? For years, the jury system has been under attack, particularly in Alabama, by surrogates of mega corporations who claim that the jury system is out of control. For years, those attacks have been successful and juries have been reluctant to punish corporate wrongdoing.

Those trends seem to be changing. Recently, our firm conducted a focus group in a very conservative county. We represent several small businesses in that county whose insurance carrier denied their storm damage claims and effectively put them out of business. We conducted the focus group to gauge their thoughts on many issues, including punitive damages. We selected a conservative cross section, which included insurance agents and business owners. The results were striking.

Small town America is angry with corporate America. Small town America says corporate America is getting a bail out and small town America is not only getting left out, but forced to pick up the tab. One member of the panel spoke from the heart. He said frankly that in the past he was reluctant to award significant damages in a civil case for fear that the trickle-down effect would hurt his local community, but now he believes otherwise.

When we hear about the excesses of corporate pay, it is easy to see why small town America feels like they do today.

Image by conorwithonen via Flickr

For more on excessive corporate pay and golden parachutes, see the attached article:

http://finance.yahoo.com/career-work/article/107075/golden-coffins-golden-offices-golden-retirement?mod=career-salary_negotiation

PDKH client awarded $17,000,000.00 today by Hale County Jury

PDKH client Chapman Logging was awarded $17,000,000.00 by a Hale County jury today. The case involved the sale of a defective logging skidder equipped with a Cummins engine. The case was tried by PDKH attorney David Hodge, along with Vance McCrary of The Gardner Firm and James Seale of Greensboro.

PDKH Lawyers obtain award for mother and daugher injured by drunk driver

Pittman Dutton Kirby & Hellums attorneys Chris Hellums and David Hodge of Birmingham, along with Tom Denham of Moulton recently tried and received a verdict in the Circuit Court of Lawrence County in the amount of $2,075,000. The verdict consisted of $850,000 in compensatory damages and $1,225,000 in punitive damages.

PDKH represented a family from Lawrence County whose lives were forever altered when they were hit head-on collision by a drunk driver on July 18, 2006. The driver of the other vehicle crossed the center line and hit the Lawrence County residents head on. At trial, PDKH lawyers Chris Hellums and David Hodge were able to introduce into evidence that at approximately 9:40 am in the morning, the driver of the other vehicle was intoxicated at a level of almost four times the legal limit and that his vehicle had open containers and empty bottles in the front seat.

The force of the impact was so great that the client's vehicle traveled 39 feet in the opposite direction from which it was traveling and caught fire. Heroic fellow motorists were able to pull the mother and daughter from the burning vehicle as it exploded in flames. The mother suffered numerous physical injuries including two collapsed lungs, a broken collar bone and broken ribs, all of which required multiple surgeries, extensive hospitalization and painful physical therapy. The 16 year-old daughter suffered a broken back and a spinal cord injury that left her paralyzed. After months of surgeries and physical therapy, coupled with a strong will to overcome and prayers from others, the teen was able to take her first steps without the assistance of a wheel chair. Even though the teen will never live without pain, she continues to work hard and undergo physical therapy as she strives to walk normally again.

This case was tried by partners Chris Hellums and David Hodge. Chris Hellums can be reached at chrish@pdkhlaw.com and David Hodge can be reached at davidh@pdkhalw.com .

To read more:

http://legacy.decaturdaily.com/decaturdaily/news/060719/wreck.shtml

http://legacy.decaturdaily.com/decaturdaily/news/060824/hurt.shtml

http://legacy.decaturdaily.com/decaturdaily/news/061010/morgan.shtml

FDA Warns Consumers to Stop Using Hydroxycut Products

If you have suffered injury from using a Hydroxycut Product, contact attorney Chris Hellums at ChrisH@pdkhlaw.com for assistance with your potential claim.

The U.S. Food and Drug Administration is warning consumers to immediately stop using Hydroxycut products by Iovate Health Sciences Inc., of Oakville, Ontario and distributed by Iovate Health Sciences USA Inc. of Blasdell, N.Y. Some Hydroxycut products are associated with a number of serious liver injuries. Iovate has agreed to recall Hydroxycut products from the market.
The FDA has received 23 reports of serious health problems ranging from jaundice and elevated liver enzymes, an indicator of potential liver injury, to liver damage requiring liver transplant. One death due to liver failure has been reported to the FDA. Other health problems reported include seizures; cardiovascular disorders; and rhabdomyolysis, a type of muscle damage that can lead to other serious health problems such as kidney failure.

Liver injury, although rare, was reported by patients at the doses of Hydroxycut recommended on the bottle. Symptoms of liver injury include jaundice (yellowing of the skin or whites of the eyes) and brown urine. Other symptoms include nausea, vomiting, light-colored stools, excessive fatigue, weakness, stomach or abdominal pain, itching, and loss of appetite.“The FDA urges consumers to discontinue use of Hydroxycut products in order to avoid any undue risk. Adverse events are rare, but exist. Consumers should consult a physician or other health care professional if they are experiencing symptoms possibly associated with these products,” said Linda Katz, M.D., interim chief medical officer of the FDA’s Center for Food Safety and Applied Nutrition.Hydroxycut products are dietary supplements that are marketed for weight-loss, as fat burners, as energy-enhancers, as low carb diet aids, and for water loss under the Iovate and MuscleTech brand names. The list of products being recalled by Iovate currently includes:

Hydroxycut Regular Rapid Release Caplets
Hydroxycut Caffeine-Free Rapid Release Caplets
Hydroxycut Hardcore Liquid Caplets
Hydroxycut Max Liquid Caplets
Hydroxycut Regular Drink Packets
Hydroxycut Caffeine-Free Drink Packets
Hydroxycut Hardcore Drink Packets (Ignition Stix)
Hydroxycut Max Drink Packets
Hydroxycut Liquid Shots
Hydroxycut Hardcore RTDs (Ready-to-Drink)
Hydroxycut Max Aqua Shed
Hydroxycut 24
Hydroxycut Carb Control
Hydroxycut Natural

Although the FDA has not received reports of serious liver-related adverse reactions for all Hydroxycut products, Iovate has agreed to recall all the products listed above. Hydroxycut Cleanse and Hoodia products are not affected by the recall. Consumers who have any of the products involved in the recall are advised to stop using them and to return them to the place of purchase. The agency has not yet determined which ingredients, dosages, or other health-related factors may be associated with risks related to these Hydroxycut products. The products contain a variety of ingredients and herbal extracts.

Lawyer Chris Hellums and the firm of Pittman, Dutton, Kirby and Hellums P.C. have extensive experience in representing individuals in consumer product safety claims. Please contact Chris Hellums directly for assistance with your potential case at ChrisH@pdkhlaw.com.

Abusive 412(i) Tax Shelter Litigation

PARTIES:

Typically, these transactions will include an Insurance company, accountant, tax attorney, and a promoter (someone with an insurance background, perhaps an actuary, who knows how to structure the policy itself). These groups will use insurance brokerages and sub-agents (licensed in the various states) to sell the policies themselves.

INSURANCE COMPANIES
AMERICAN GENERAL LIFE INSURANCE COMPANY
INDIANAPOLIS LIFE INSURANCE COMPANY
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
PACIFIC LIFE INSURANCE COMPANY MET LIFE
PROMOTERS/ATTORNEYS/ACCOUNTANTS
KENNETH HARTSTEIN ECONOMIC CONCEPTS, INC.
PENSION SERVICES, LLC
BRYAN CAVE LLP
RICHARD SMITH

HOW THESE PLANS WORK:

In the late 1990’s, the individuals and groups above devised a scheme to sell abusive tax shelters under the auspices of Section 412(i) of the tax code. A 412(i) is a defined benefit pension plan. It provides specific retirement benefits to participants once they reach retirement and must contain assets sufficient to pay those benefits. A 412(i) plan differs from other defined benefit pension plans in that it must be funded exclusively by the purchase of individual life insurance products. To create a 412(i) plan, there must be a trust to hold the assets.

The employer funds the plan by making cash contributions to the trust, and the Code allows the employer to take a tax deduction in the amount of the contributions, i.e. the entire amount. The trust uses the contributed funds to purchase some combination of life insurance products (insurance or annuities) for the plan. As the plan participants retire, the trust will usually sell the policies for their present cash value and purchase annuities with the proceeds.

The revenue stream from the annuities pays the specified retirement benefit to plan participants. These defendants (with the aid and knowledge of the insurance companies) used the traditional structure and sold life insurance policies with excessively high premiums. The trust then uses the large cash contributions to pay high insurance premiums and the employer takes a deduction for the sum of those large contributions. As you might expect, these policies were designed with excessively high fees or “loads” which provided exorbitant commissions to the insurance companies and the agents who sold the products.

The policies that were sold were termed Springing Cash Value Policies. They had no cash value for the first 5-7 years, after which they had significant cash value. Under this scheme, after 5-7 years, and just before the cash value sprung, the participant purchases the policy from the trust for the policy’s surrender value. In theory, you have a tax free transaction.

The IRS does not recognize the tax benefit of such a plan and has repeatedly issued announcements indicating that such plans are contrary to federal tax laws and regulations. These plans were targeted to high net worth individuals, including doctors, dentists, corporate executives, and professional athletes.

If you would like to speak to one of our attorneys regarding this area of litigation, please contact Chris Hellums

Physicians Mutual Insurance Company Class Action

Result: $23 million for class representatives and class members residing in the states of Alabama, Mississippi, and Texas.Venue: Alabama, Mississippi, Texas

Named plaintiffs entered into insurance contracts with Physicians Mutual Insurance Company which contained a rider that provided certain outpatient sickness and accident benefits. The plaintiffs alleged that Physicians Mutual wrongfully failed to pay insurance claims for the plaintiffs and other class members.

Physicians Mutual is an insurance company based in Omaha, Nebraska that sells numerous types of insurance products throughout the United States. Beginning in 1993, Physicians Mutual began selling a supplemental insurance product in Alabama called the “Outpatient Plus Plan,” which is a supplemental insurance product comprised of a hospital indemnity policy and a combination of two or more riders. One of the riders attached to the hospital indemnity policy was the outpatient benefit rider, which pays a fixed benefit of $100.00 each time a policyholder makes a claim that meets the requirements of the rider. The Plaintiffs entered into insurance contracts with Physicians Mutual which contained a rider that provided certain outpatient sickness and accident benefits. In the lawsuit, the plaintiffs, individually and on behalf of all class members, alleged that Physicians Mutual wrongfully failed to pay insurance claims.Through the discovery process, the plaintiffs gathered significant documentation to support the allegations.

The result was that Physicians Mutual paid $23 million for class representatives and class members residing in the states of Alabama, Mississippi, and Texas.