We’ve all heard the saying “what happens in Vegas stays in Vegas.” Yet, it might not.
Here’s another saying for you: “What begins in California could spread throughout the country.”
Today’s story will be of special interest to personal injury (PI) lawyers who run settlement mills and plaster billboards near airports, on buses and buy TV ads that proclaim something along the lines of, “Hire me! I get millions of dollars for my clients!”
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It will also be of serious interest to anyone thinking about hiring one of these law firms.
Often, attorneys in these ads say, “I care. Call me.” But good luck getting them on the phone to talk to you — ever!
State bars across the country apply terms such as “misrepresentation,” “dishonest” and “false advertising” to ads that promise direct attorney access (“call me”) when clients are able to reach only non-legal staff or automated systems.
These settlement mills routinely deliver cookie-cutter, one-size-fits-no-one, substandard legal representation, not to mention those who engage in fraud.
But now they’re being taken on, and their efforts are aimed directly at the lawyers’ bottom lines via legislation that should give crooked PI attorneys nightmares.
Uber fights back
Uber has filed civil RICO (Racketeer Influenced and Corrupt Organizations Act) lawsuits in federal courts against several personal injury law firms and affiliated medical providers in California, New York and Florida.
I discussed these suits with a friend of this column, Southern California attorney Shawn Steel, who represents personal injury victims and has taught ethics and jurisprudence courses to doctors-in-training at Cleveland Chiropractic College since 1991.
The basis of Uber’s allegations, according to Steel: Uber alleges a conspiracy to artificially increase claim values by creating evidence of injury, staging accidents and fabricating damage. Clients are steered to medical providers who perform or recommend unnecessary procedures to run up treatment bills.
The lawsuit takes the business model of personal injury mills head on. Uber is especially vulnerable to these schemes because it is required by some states to have insurance policies with much higher limits than those of individual drivers — even taxi cabs.
“The more insurance available, the greater the claim value if you’ve got the medicals,” Steel underscores.
However, it must be noted that Uber customers in California and other places that have high insurance limits are the ones bearing the burden of higher insurance premiums because they’re charged higher fares.
“Uber is using the RICO statute,” Steel notes, “which is aimed at prosecuting organizations engaged in a pattern of racketeering activity, and if successful, this could establish a precedent for corporations to fight back against what they allege — and can prove — is fraudulent activity.”
A ballot measure to protect consumers
In October, Uber filed a proposed California ballot initiative, called the Protecting Automobile Accident Victims from Attorney Self-Dealing Act, aimed at protecting consumers from what it claims are predatory practices by some personal injury lawyers.
If this measure gets on the ballot in November 2026 and passes, it will be a tsunami for PI mills and medical providers who have relied on an endless stream of attorney liens on settlements to pay their inflated bills.
There is real, palpable fear of similar initiatives spreading throughout the country, hitting personal injury lawyers in the pocketbook.
Supporting documentation for the ballot initiative notes that it would ensure victims keep at least 75% of a settlement or judgment by restricting arrangements between attorneys and health care providers and eliminating financial incentives for attorneys to inflate medical expenses.
Attorneys would also be prohibited from receiving kickbacks from or paying kickbacks to medical providers who refer their patients.
No more ‘I charge what the market will bear’
The initiative would tie recoverable medical expense damages to standardized rates.
Medical costs would be based on Medicare or a national database rather than the actual bills from lien-based providers. This would eliminate situations where accident victims are sent to doctors who are comfortable with charging hugely increased rates because their friend, the attorney, ensures payment with settlement liens.
So, if this initiative passes, excessive medical charges would not be fully recoverable regardless of what providers bill.
Criticism from consumer advocates
As would be expected, personal injury attorneys are gearing up for a huge battle in the media.
Consumer Attorneys of California (COAC) calls the initiative misleading, saying it undermines accident victims’ ability to secure strong legal representation. It also argues:
- That the limit on fees discourages attorneys from taking complex cases, leaving victims underrepresented
- That the case is nothing more than a corporate liability shield, not consumer protection
What this means for consumers
Regardless of whether the initiative becomes law, if you need an attorney after being involved in an auto accident, your best way of finding a reputable one is the tried-and-true referral from friends, family or other lawyers.
Read online reviews on sites like Google, Avvo, Martindale-Hubbell and Yelp. Pay more attention to the two- and one-star reviews — the details in the negative reviews are more important for you to know than the glowing praise.
Be sure the lawyer has a local office, not just a phone number. You might want to even go there to make sure it exists.
Most important of all, over the phone or with a paralegal or the law firm’s investigator who comes to your home and interviews you about the accident, say, “I expect to deal with and speak to (the name of the attorney) and meet with them in person.” Write this on the retainer agreement. Then, if it does not happen, you will have strong grounds to fire that law firm.
If you are dealing with a settlement mill, those requests will be refused.
If anyone gives you any trouble, call me. You can reach me at (661) 323-7911, or send me an e-mail at Lagombeaver1@gmail.com.
Dennis Beaver practices law in Bakersfield, Calif., and welcomes comments and questions from readers, which may be faxed to (661) 323-7993, or e-mailed to Lagombeaver1@gmail.com. And be sure to visit dennisbeaver.com.
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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.
