

California: lose your wage claim and pay your employer's attorneys' fees - grellas
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JangoSteve
If a lot of people were abusing the system to get undue money from employers,
knowing it would cost the employers far less to settle than to fight, then
that's obviously bad. However, this type of regulation seems like it now
swings the entire system in favor of the employers rather than neutralizing
the problem.

In other words, people who actually were wrongfully withheld their just pay
will now greatly fear losing even if they know they were wronged, and so the
employers have less to fear by wrongfully withholding pay. It seems to me
there should be a separate judgement as to whether or not the claimants
accusations were fraudulant or malicious, separate from whether or not they
lost the claim itself, before imposing this harsh penalty.

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blahedo
Ok, I guess I don't understand what "dismissed... with prejudice against all
parties" would mean, then. If the company didn't "win" the suit, why do they
get to recover lawyer fees?

I also worry about all the asymmetries: the basic one (company has deeper
pockets), but also some subtler ones: the company hires more expensive
lawyers, the company may retain lawyers, the company has more experience with
these cases, etc.

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ams6110
"With prejudice against all parties" means, effectively, that the decision is
final, i.e. neither side can re-file the claims as a new complaint.

Recoverability of attorney fees varies by jurisdiction. I've recently been
involved in a claim against an insurance company and where I am, in civil
disputes each party pays their own fees, regardless of the outcome. The only
way you can recover your fees in addition to actual damages is to have the
judge decide that the other party took an egregiously unreasonable position.

Seems unfair in that after fees I recovered only about 15% of my loss but I
suppose the approach does serve to keep both sides honest.

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electromagnetic
Yes, but what would be worse, you recovering only about 15% (and costing your
opposition hopefully as much as you lost or more), or you recovering nothing
and the insurance company keeping everything?

The problem I've noticed with insurance companies is that they try to run a
profit off of the individual person, when really they should be running a
profit off of the community as a whole. This is greed vs sustainability.

If I charge 100 people $5 for some bogus insurance, if I only pay out $450 for
the group, I'm netting $50. However, insurance companies charge 100 people $5
and will up each individuals payments for any claim to try and keep making
$500.

100 people getting good insurance at a great cost will stay with a company
until they die, they'll also get their friends and family to join up. Suddenly
you've got 1,000 people and you're making $500 from loyal customers.

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fleitz
Read any economics paper on the issues involved in insurance and you'll
understand why things are the way they are. Moral hazard abounds on both sides
of the transaction, there are many other transactions that each party is a
stakeholder to.

It sounds like you have an issue with the premium the company charges for
taking the risk vs. how they are making their money as the only difference. Do
you feel that the guy who leaves his doors unlocked and thus gets broken into
a lot should pay the same premiums as you? (I assume you lock your doors /
take other precautions)

Oh and your loyal customers they left because they saw an ad from progressive
/ geico about how they could save thousands on their insurance. Or conversely
GEICO/Progressive see the rates you are charging and think about how much
money they could make if they substituted their service with yours and then
make you a "crazy" offer to sell.

Also, part of GEICO's rates are the investment genius of Warren Buffet, by
making shrewd investments with the premiums they are able to discount the
insurance rate by a portion of the interest accrued on the premium.

~~~
ams6110
One of these companies, I think it is GEICO, was able to offer low rates
because they only took drivers with spotless accident histories, and they
would drop you after one claim. I'm not sure they still operate this way,
because they advertise on a lot of mainstream outlets now, and before I
remember them being almost a "by invitation only" sort of deal.

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schwit
It sounds like the previous system was stacked against the corporations. Why
shouldn't the system be designed to discourage frivolous suits? Stockholders
are people too.

If a person brings suit and loses, their lawyer should also be held
accountable.

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bugsy
That's pretty fucked up. When the legal system has failed this badly, armed
revolt is about the only option left.

