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Michigan Lawyers Weekly finally tackles “Ambulance chasing in the digital age”

June 12, 2012 by Steven M. Gursten

How some injury lawyers are contacting car accident victims hours after a crash, and the kick-backs and No-Fault abuse by some attorneys and medical providers

Last week, Carol Lundberg from Michigan Lawyers Weekly tackled a serious issue that is bordering on epidemic as of late: attorneys soliciting by mail, and increasingly by phone through proxy, of auto accident victims.

Personal injury lawyers are orchestrating most of this by using non-lawyers and chiropractors to get around the attorney solicitation rule that currently exists that prevents lawyers from cold-calling Michigan car accident victims. An increasing number of lawyers are buying UD-10s of car accidents online, and sending out solicitation packages. Others are using investigators, runners and cappers to call and even visit people who have been in car accidents at home. In some cases, these people have literally been waiting outside of people’s homes for them to return from the hospital.

Sadly, the buying of police reports online has created a new type of “digital” ambulance chasers.

Here’s the Michigan Lawyers Weekly story: ‘Ambulance chasing’ in the digital age.

Carol told the story of Alexandra Burgett, a young girl from Plymouth who suddenly died in a car accident. Within days, the Burgett family received several solicitation packages from attorneys offering their legal services. Of course, the family found this “offensive” and “intrusive.”

The Michigan Lawyers Weekly story also discussed how some of these attorneys are allegedly pushing their clients to get unnecessary medical treatment and fraudulently charging Michigan No-Fault.

What’s happening is people injured in car accidents are getting telephone calls from complete strangers, “informing” them of their No-Fault rights. These phone calls come with an offer to send an investigator to the house, with a referral to a chiropractor or physical therapist, and then a strong push to a personal injury lawyer. There have even been some lawsuits, including this one recently filed in United States Eastern District Court, State Farm v. Physiomatrix et. al, that names an alleged investigator by name.

Michigan Lawyers Weekly speculates a “beneficial relationship” between personal injury lawyers and doctors that are receiving kickbacks for these abuses.

According to Michigan Lawyers Weekly:

It gives lawyers a bad name, said Norman Tucker, attorney with Sommers Schwartz PC in Southfield.

Earlier this year, two local television news stations ran reports about people who had been in car crashes, who started getting phone calls within hours, from so-called accident services organizations — cappers, or runners, as they’re known. They represent health care providers, such as chiropractors and pain clinics.

But even among health care providers who don’t engage runners to solicit business, it also is alleged — by one of the television news stories, and in at least one lawsuit filed in federal court in April — that some health care providers have cozy beneficial relationships with personal-injury lawyers. And that’s just part of the greater problem in no-fault personal-injury cases.

The beneficial relationship

State Farm is suing a group of health care providers in the Eastern District of Michigan. The insurance company claims that the providers fraudulently billed for services provided under no-fault.

In State Farm Mutual Automobile Insurance Co. v. Physiomatrix Inc., et al., filed April 3, State Farm alleges a quid pro quo relationship between the health care providers and two personal-injury firms.

In that relationship, the complaint alleges, the providers maximize their collection of no-fault benefits and inflate the value of the claims to curry favor with the personal-injury lawyers with whom they have a cross-referral system.

Southfield-based attorney Michael Morse was one of those attorneys. State Farm claims that, of the 61 patients for whom the defendants submitted bills to State Farm, 59 percent of them or 36 patients — were represented by Morse.

Tucker said he doesn’t know yet whether State Farm’s allegations, or any of the other rumors, are true. But he’s quite certain that all of it adds up to ruin the reputations of trial lawyers. The phone calls by the health care providers who also provide information about law firms, the cozy referring relationships, and the mass mailings to injured people are making the plaintiffs’ bar look bad, he said.

Personal-injury attorney Steven Gursten agrees. He said he’d like to see all of it stop — the law firm mailings and the non-lawyer solicitation.

“Cappers and runners are against the law, so these law firms can get non-lawyers to do it. Everyone knows who they are, and no one wants to name names,” he said. “It’s been building over the past couple of years and it’s exploding now. It’s become an industry. And it’s all legal.”

He said that only a very small number of lawyers are working directly with the doctors.

“The lawyer keeps telling these people you have to treat. You have to see this doctor, and this doc only,” Gursten said. “Then they don’t care what happens to the people on their third-party cases. They make all the money on the first-party side, with the chiropractor bills. Data (gold) mining

Law firms and health care organizations can get crash information from online data services like TRACView, which have made accident data in bulk available to the public. Law firms routinely use the information to send solicitation mail.

Non-lawyers aren’t prohibited from making phone calls, or even paying in-person visits, to people involved in crashes.

Burgett’s brother-in-law, Robert Edick, is the deputy grievance administrator for the Attorney Grievance Commission.

He held the stack of mail sent to his niece’s family.

“The first one was from the Bernstein firm, then on the 15th there was one from Matz & Pietsch, and another one from them on the 23rd, then two from Nathan French, then a follow-up dated on the 23rd from Bernstein, then another on the 23rd from Benner & Foran,” he said. “It seems odd that they started arriving so soon.”

If there is going to be change, it’s probably going to have to be a legislative fix, Gursten said.

The Legislature took a first, but very small step, when it passed Senate Bill 298, which makes it illegal to work as or employ someone who appears at accident scenes in order to direct victims to particular doctors or attorneys. Gov. Rick Snyder signed the bill into law in March.

But the law should go further, Gursten said.

“We could have legislation that prohibits an injured person from being contacted by anyone for a certain period of time,” he said. “But it would have to be the law that no one could contact them, not the lawyers, not the health care providers. No one.”

Edick suggested that if the concern is that insurance companies will take advantage of people by rushing them into a settlement, perhaps the solution is to give a 30-day period to rescind a settlement.

“It’s all because of the information available online,” Bernstein said. “Maybe the answer is to make it more difficult to obtain police reports, which are the mother’s milk of this enterprise. Michigan is unique in that you can obtain accident reports en masse.”

Tomorrow I will be discussing my suggestions on how to solve this awful problem.

– Steven M. Gursten is a personal injury lawyer and head of Michigan Auto Law. He is president of the Motor Vehicle Trial Lawyers Association and has received the highest verdict or settlement for a car or truck accident case in 2008, 2009, 2010 and 2011, according to Michigan Lawyers Weekly.

– Photo courtesy of Creative Commons, by andrewmalone

Related information:

Cappers, runners and ambulance chasers, oh my!

Attorney solicitation rules: Michigan Supreme Court must do more to protect accident victims from predatory lawyers

Michigan Auto Law exclusively handles car accident, truck accident and motorcycle accident cases throughout the entire state of Michigan. We have offices in Farmington Hills, Sterling Heights, Ann Arbor, Grand Rapids and Detroit. Call (800) 777-0028 or to speak with one of our Michigan personal injury lawyers.

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