January 7, 2018
On December 11, Harvard law professor William Rubenstein filed a 47-page report with the Court detailing his recommendations regarding attorney fees as he’d been commissioned to do in September. His recommendations consisted of (1) Denying the 5% holdback from all approved awards to fund future implementation work on the settlement as requested by Co-Lead Class Counsel Chris Seeger, and (2) Capping individual attorney fees at 15%. The professor’s report appeared well reasoned and presented, but as pointed out in the 12 responses filed Wednesday, he seemed to lack some critical information when he prepared it, including correct actuaries on player demographics and anticipated awards as well as the immense difficulty in getting claims approved. Since no one questions Professor Rubenstein’s credentials or intelligence, several attorneys have indicated to me that they wonder how he could have been shielded from current and pertinent information which they feel would have substantially altered his recommendations to the Court.
Initially, when Professor Rubenstein was appointed to review attorney fees Judge Brody indicated that after the report was issued, any party would have the opportunity to depose the professor in addition to filing a written response to his proposals. Instead, after the report was issued, Judge Brody wrote, “In appointing Professor Rubenstein, the Court noted that all interested parties would have an opportunity to respond to his report pursuant to the discretionary deposition process set forth in Fed. R. Evid. 706(b)(2). Professor Rubenstein’s 47-page report is sufficiently comprehensive and detailed that I have decided that it will be most helpful to the Court and most efficient for the fee process to have interested parties simply respond in writing to Professor Rubenstein’s opinions.” In addition to revoking the opportunity to depose Professor Rubenstein, she limited the responses to 10-pages with a due date of January 3.
Prior to the response deadline, two law firms filed motions asking the Court to reconsider the deposition of Professor Rubenstein. These motions were supplemented with two notices of joinder, but Judge Brody did not rule on the motions, forcing all parties who wished to respond to his recommendations to meet the January 3 deadline. Twelve responses were filed. Her inaction has added fuel to the speculation among attorneys that she doesn’t really want to hear from anyone other than Seeger, who is largely presenting a rosy picture of a thorny situation.
Ten of the twelve respondents agreed with Professor Rubenstein’s recommendation regarding the elimination of the 5% holdback for future settlement implementation work. Co-Lead Counsel Sol Weiss felt that a 1% holdback was more appropriate and the 5% requested by the other Co-Lead Counsel Chris Seeger was too high. As expected, Seeger defended his request to withhold 5% from each approved monetary award.
In contrast to the near unanimous opposition to the 5% with Seeger being the sole party in favor of it, he again stood alone in favoring the 15% cap on individual attorney fees, but oddly, in his opposition citing a very difficult claims process, he inadvertently reinforced the arguments of the private counsel who felt that either the cap was too low or that it was inappropriate.
In the first response filed, Class Counsel Gene Locks agreed with Professor Rubenstein in part:
While agreeing with Professor Rubenstein on the 5% holdback and “accepting” the 15% cap on some fees, Locks, whose firm represents the largest number of clients in the Settlement, pointed out that pre-effective claims are much more labor intensive than Professor Rubenstein realized or acknowledged and therefore commanded a higher cap at 20%, further stating, “The NFL’s actions have magnified by several-fold the amount of work required to advance a claim. The NFL delays, opposes, or appeals the majority of claims and awards, such that competent counsel is now vital to player recovery.”
The report and responses are adding additional confusion to the Class in regard to attorney fees. Thursday I spent much of the day on the phone and in correspondence to retired players or their spouses explaining that the $112.5 million is in fact as they believed, a separate set-aside in which the NFL has agreed to pay Class Counsel for their work in negotiating the Settlement. A New York Post article created doubt of this in their reporting of the story. While it is separate from the Monetary Award funds Professor Rubenstein, in his calculations included it in the total value of the Settlement and the presentation in the Post story made it incorrectly appear that an additional 15.6% would be deducted from awards. This is not the only problem, however. When it was announced that the NFL would not contest paying this sum to Class Counsel many players incorrectly believed that it would be equitably divided among all of the attorneys in the case and they began to resent the contingency fee agreements they signed, feeling that their lawyers were double-dipping. Most didn’t realize that Chris Seeger would receive the bulk of this payment (apparently money well spent by the NFL) and that the vast majority of attorneys would receive nothing at all from this common benefit fee. Further escalating the confusion was Chris Seeger’s indication that the filing requirements would be simple and players didn’t need a personal attorney in order to get their claims filed and processed.
As a result, many players fired the attorneys they’d retained and decided to represent themselves or hired other counsel who had approached them with cheaper retainer fees. Seeger’s action pitted players against their lawyers and attorneys against fellow members of the Bar. Now players are breathing a sigh of relief in that the Professor has recommended that contingency fees be capped, at least in most cases, at 15% oblivious to the fact of how this might actually be to their detriment.
Attorneys state this will not only negatively impact them, but their clients as well, in that the fight to get claims approved has become difficult, time-consuming and litigious in and of itself. Those attorneys who are dealing with delayed and denied claims wonder if they can continue to afford to continue to spend countless hours litigating each and every claim and funding medical exams as needed if their fees are reduced in this manner. With the low approval rates characteristic of the Settlement thus far, they see continued investment as risky and wonder if the claims they manage to push through to approval will offset the financial loss of those that are denied.
In a closer analysis, one learns that in exchange for the uncapped settlement the NFL bargained for stricter fraud prevention measures as shown in Section 10 of the Settlement Agreement. The full text of the Audit and Fraud Prevention measures comprises pages 55-58 of the Agreement but the sections below appear to be at the root of the delays and denials retired players are experiencing.
The most important portions to note are that the NFL has the absolute right and discretion to audit claims. This means that the NFL can review as many claims as desired and place them under audit. Other provisions (not pictured) under Section 10.3 detail the information that may be required on an audited claim, and if it is found to be fraudulent, the measures that may be exacted against the doctor who examined the player as well as the attorney who filed the claim. Section 10 also provides that the Claims Administrator will conduct a random audit of 10% of claims each month. While the vast majority of claims are not fraudulent, this allowance can tie a legitimate claim up for months placing the claimant, his attorney, and his doctors on the hot-seat in order to prove the validity of the claim in a “guilty unless proven innocent” mindset.
Section 10.4 is also very relevant to the delays, in that “system-wide processes” will be implemented in order to “detect and prevent fraud.” One of these processes is in holding what the Settlement refers to as “generally consistent” diagnoses for pre-effective date claims to the rigid post-effective date standards and the enactment of BAP criteria, including raw scores which many older diagnoses do not have. The enactment of these “procedures” has created a nightmare for retired players and attorneys alike.
It’s informative to note that every single response to Professor Rubenstein made note of the difficulty the enactment of these “procedures” has created.
“I don’t know how much more I can endure…this is worse than the NFL Disability corruption simply because we kept bringing that up when this was being negotiated and were assured that exactly what is happening now could never happen under the terms of settlement.”
Those are the words of a player who recently learned that his long-standing diagnosis which predates even the first brain injury lawsuit is being challenged in spite of meeting the plainly written requirements of the Settlement in accordance with the way pre-effective date claims are to be handled.
“Why does the NFL always want to paint us as liars and frauds? Don’t they realize we’re sick? Do they even care?”
Sadly it appears they do not. The NFL’s aggressive so-called fraud prevention measures which in court filings Seeger refers to as “procedures” have resulted in a massive backlog in claims processing and an inordinate number of denials. Oddly in defense of the 5% holdback, Chris Seeger writes in his declaration:
This is exactly the issue numerous counsel representing individual players have filed motions to address yet, Seeger, often jointly with the NFL, has opposed each of these motions and Judge Brody has ruled with deference to Seeger. An analysis of the situation begs the question, “Why does Seeger oppose other counsel in conjunction with the NFL on the same issue he purports to be arguing in opposition of the NFL?”
The results have been disastrous. The January 2 claims report indicates that of 1,569 claims filed for monetary awards, only 206 have been approved, with 61 claims denied. The remainder are in what is now called a state of “preliminary review,” which seems to be a kind of purgatory in which claims are purged and embroiled in an intense battle as a prayer of relief is sought.
Of the 13% of claims which have managed to emerge favorably from this purgatory, checks have been issued for only 67. Of the 206 approved claims, 24 of these are currently under appeal. The remaining 115 are still subject to audit or appeal from the NFL further delaying payment to debilitated and distraught players and their families.
Out of 73 Death with CTE claims 53 have been approved; 4 have been denied with the remaining 16 in deficiency.
Out of 35 ALS claims 20 have been approved. None have been denied at this stage, however 15 have landed in deficiency because of technicalities.
Out of 243 Alzheimer’s claims 71 have been approved, 27 denied, with the remaining 141 in claims deficiency.
Out of 72 claims for Parkinson’s Disease 34 have been approved, 3 have been denied with over half – 35 claims – deemed deficient.
Out of 449 claims for Level 2.0 dementia only 9 have been approved. Fifteen have been denied and the remaining 425 are in purgatory. This is a startlingly low 2% approval rate.
Out of 591 claims for Level 1.5 dementia 15 have been approved and 12 denied with 564 in deficiency for a troubling 2.5% approval rate.
Each claim must be battled as if it is a lawsuit in and of itself. The streamlined “claims filing” process as cited by Professor Rubenstein has turned into a frustrating and labor-intensive ordeal which is described in numerous responses to Rubenstein’s report; many independent attorneys for players, who will receive none of the common benefit places either their clients or their firms in jeopardy. Either they earnestly put the time and money into fighting the NFL’s demands and hope a sufficient number or claims are approved to come out on the plus side financially or they back off and cut their losses to the detriment of the players. No one I’ve spoken with wants the latter but this is a very legitimate concern for many lawyers. Could this be a primary factor in the “fraud procedures” the NFL is insistent upon? Initially, both the NFL and Co-Lead Counsel Chris Seeger discouraged players from hiring their own lawyers. Are they now trying to eliminate or freeze out the lawyers who are diligently working to get claims approved and put the process back on track?
Many legal experts predicted before the first claim was filed that the NFL would attempt to mitigate its losses with dementia claims, and this is absolutely playing out as true. While a breakdown of represented and unrepresented Class Members according to diagnosis is not available, the latest figures reflect that 31% of claimants have not retained counsel. In view the NFL’s aggressive fight against claims it is unlikely that an unrepresented player will stand a chance unless by chance it’s an ALS or possibly a Death with CTE claim – even pathology has been contested in some cases.
As all of the plaintiffs’ lawyers pointed out, Professor Rubenstein used very inaccurate (and extremely low) actuarial data in regard to anticipated claims payouts and also stated that the majority of claims awards will be for Levels 1.5 and 2.0 dementia to men in their 80’s. Attorneys tell me that they represent very few 80-year-olds. The majority of their clients are men in their late 30’s through 50’s, with also a substantial number of claims for retirees in their 60’s and 70’s. It’s beginning to appear that part of the NFL’s strategy is to limit Alzheimer’s claims, by disputing and downgrading the diagnosis to lower dementia payout levels and then to delay for as long as possible in order to finally settle with the players that survive at a more advanced (and less expensive pay-out age). This strategy coupled with efforts to impede and discourage individual counsel capable of navigating the maze by creating a time consuming and labor intensive process with high risk weighed against very low contingency fees seems detrimental to everyone involved. Except, of course for the NFL whose wealth will barely see a blip and Chris Seeger, who is already guaranteed a very handsome payday regardless of the number of claims approved. With his pay secured, he is already moving on to a new opioid lawsuit which will surely consume a great deal of his time, likely to the detriment of the Class Members of the concussion litigation. If my assessment is correct, the NFL’s strategy appears to be both brilliant and despicable, while Co-Lead Class Counsel’s ambivalence is especially disconcerting.
Judge Brody is the wildcard. She is a seasoned and respected federal judge. At 82 years of age, she is probably also close to retirement, and the concussion settlement will likely be either the crowning jewel of her career or the thorn that taints her legacy. In view of her rulings against every member of individual counsel which would benefit the vast majority of retired NFL players and her rulings which jointly have favored Seeger and NFL counsel to the detriment of players one must ask the serious question, “Is she aware of and does she understand what is taking place in the claims process?” If so, “What is she going to do in order to curtail the bully tactics of the NFL, and get the objective of compensating injured players working properly and in a timely manner?” Recent indications would lead credence to the theory that she is becoming concerned. In November at the request of a number of Class Members, she agreed to make claims reports publicly available and beginning in December, she has, creating greater transparency. Now she needs to move a step further and enforce the settlement contract as it’s written and take a critical look at how, under the guise of fraud prevention. the NFL is derailing the settlement she worked to achieve, and take corrective measures before it is too late for the sick and dejected retirees who depended on her promises.