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How Filing for Chapter 11 Bankruptcy Will Affect the Boy Scouts of America

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After years of victims of child sexual abuse coming forward to speak against the Boy Scouts of America (BSA), the organization has declared bankruptcy. The filing is a result of multiple class-action lawsuits against the organization for failing to protect the young boys in their care, turning a blind eye to the abuse of an estimated 12,000 victims. But is bankruptcy enough for the victims?

 

What does chapter 11 bankruptcy mean?

When a business files for chapter 11 bankruptcy they are admitting that they are unable to sustain their business with their current trends. For the BSA, this means that they are unable to continue covering the damages and payouts to the sexual abuse victims suing them. Businesses going through chapter 11 bankruptcy are making a statement that they plan to reorganize their finances in order to repay their debts. 

Bankruptcy court demands statements of assets, liabilities, and important aspects of the business to be released. It also means that the organization will halt operations until its finances are sufficiently reorganized. 

This also means that there is now a deadline for victims to come forward. This has received strong criticism, since forcing victims to come forward before they are ready often leads to victims never coming forward at all. It could also reduce the amount available for compensation for individual victims who do come forward.

 

How are victims responding?

Sexual abuse has a unique impact on each individual victim, which presents in different reactions. A large number of victims who have come forward see the filing as a success; proof that the BSA knows it did something wrong and is going to pay for it. Some victims don’t care about the compensation and only care that the world knows about the scope of the problem. This group believes that even if it means each individual gets less of a payout, it’s worth it if more people come forward. 

Another group sees the filing as a cop-out. Reducing the number of victims that are willing to come forward drastically reduces the amount the organization will have to owe. It will also limit the scope of the problem visible to the public. 

 

How will this affect local troops?

Due to the financial independence of district-level troops, local troops are unlikely to be shut down. It is still unclear how operations will change at the national level, but the organization is sure to go through a change. 

 

How has the BSA changed its policies relating to adult volunteers?

Adult members of the BSA are required to undergo training, review, and criminal background checks. Beyond this, a greater number of certified adults are being required to attend events and activities to ensure safety procedures are being followed.

 

Further Information:

https://www.bostonglobe.com/2020/02/18/metro/boy-scouts-bankruptcy-filing-could-yield-key-evidence-abuse-cases-boston-lawyer-says/

https://time.com/5785874/boy-scouts-bankruptcy-sex-abuse/

https://www.nbcdfw.com/news/local/boy-scouts-abuse-survivors-want-more-than-just-compensation-attorney-says/2313426/

Early Impacts of AB 5 in California

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California recently passed Assembly Bill 5: a bill designed to reduce companies’ abilities to take advantage of contract workers. The bill was written in response to the growing number of independent workers making their money from the gig economy, including Lyft and Uber drivers. 

 

Since it’s conception, AB 5 has caused controversy. Companies see it as a risk to their profit margins, some independent contractors demand basic benefits, and some independent contractors fear for their livelihoods. The bill excludes some professions, including doctors and psychiatrists due to their generally high incomes, and targets employers who are failing to provide those working for them with the basic necessities for living in California. It requires that employers who hire contractors for the amount of work an employee should be doing to hire them as employees. 

 

By transitioning contract workers into employees, employers would have to provide more substantial wages, protections, and benefits. This would increase the cost of labor for many employers, leading to Uber and Lyft spending over $100 million to get a ballot measure on the 2020 ballot to oppose the bill. The rideshare companies are worried, and rightfully so, that the new law requiring them to recognize all of their drivers as employees will severely lower profits. The companies say that the new measures will force them to implement driver schedules, raise rates, and reduce the freedom of their drivers.

 

This is true. What’s also true is that contract workers are often taken advantage of, with employers going with the cheaper worker rather than hiring an employee and the benefits that go along with it. 

 

The problem arises when companies now see out-of-state freelance workers as a cheaper alternative to California freelancers. This largely affects industries including construction, writing, and graphic design. Independent contractors are already feeling the pressure from the new restrictions and companies are unwilling to hire them. This is more a reflection of employers’ unwillingness to provide their workers with sufficient contracts than workers demanding too high of benefits or legislators trying to punish employers. 

 

 AB 5 won’t go into effect until January 1st, 2020. Until then we won’t know it’s full effect and how companies will respond to the new laws.

What’s Going on with GM, Fiat Chrysler, and the UAW

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Lawsuits and corruption charges have been flying around the auto industry like debris in a tornado. Most recently, American automaker GM filed a lawsuit against Fiat Chrysler, accusing the European manufacturer of bribing leaders in the UAW to get favorable labor costs. This has lead to a strong denial from Fiat Chrysler, who is currently in the middle of a merger with fellow European manufacturing giant PSA. The stock for both GM and Fiat Chrysler dropped Wednesday due to the suits, GM by about 3%, Fiat Chrysler by about 3.7%.

 

Why did GM do this? 

So if it was Fiat Chrysler that was allegedly engaging in bribery with the UAW, why is GM getting involved? Well, if you’ve been watching the news, you might remember that GM recently reached an agreement with the UAW after huge worker strikes in Detroit. The deal was difficult to create, and it’s likely that sacrifices were made on both sides for the workers to get back to work. The strike also cost GM upwards of $2 billion. 

 

The crime of which GM is accusing Fiat Chrysler is bribery, or rather, bribing higher-ups in the UAW to reach a more beneficial agreement for the manufacturer. If this is true, Fiat Chrysler would be able to produce American-made cars significantly cheaper than other manufacturers, GM included, making competition unfair.

 

What’s the Basis?

In the lawsuit, GM accuses five Fiat Chrysler executives of corruption, three of which have already been convicted by a federal anti-corruption probe. 

 

Also charged with white-collar crimes was UAW Regional Director Vance Pearson, who, along with as-of-yet uncharged UAW President Gary Jones, has been caught embezzling large amounts of funds from the Union. 

 

Fiat Chrysler strongly denies any claims of wrongdoing during their ongoing negotiations with the UAW, and the UAW remains committed to implementing new anti-corruption reforms.

You Might Need to Update Your Hiring Practices

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Employers look for certain things when they are hiring, largely whether they think the candidate The former is always vital, though flexible, but the latter can end opportunities to hire the right candidate. 

 

Your Internal Biases Will Be Your Downfall and AI isn’t Always the Answer

Everyone has internal biases. They are natural and normal, but that doesn’t mean that they’re good. Recent developments in AI are promising hiring lead by machine learning as a solution to discrimination, but have been met with unease.  After all, machine learning gets its knowledge from existing decisions. If previous decisions had a human bias towards men over women, the AI might pick up on that and continue that bias. If the AI has been told to value athletic candidates, even if the employer intends it for the teamwork implied in sports, a large section of disabled candidates could be sorted out even if they have the skills necessary.

The point is, you can’t exclude candidates until you know they aren’t right for the job, and you can’t hire candidates until you know that they’ll bring something to the team. You won’t always know what it is that they’ll bring. The Wall Street Journal wrote an article in 2016 about how Silicon Valley businesses weren’t getting most of their hires from Ivy League schools, but relatively large, not overly exclusive ones. In fact, no Ivy League school made it into the top 10 schools most hired from in Silicon Valley. While common hiring advice might be to go with the school with a better name, that hasn’t proven to be the best practice.

 

How Unexpected Candidates Can Change a Workplace

Homogenous teams rarely create revolutionary ideas. For true innovation, you need a collaboration of people from different backgrounds with different ideas. 

This means that hiring managers need to look at factors other than education and hard skills. Transferable skills and personality types are what should be looked at, but unfortunately, there are biases here too. Outgoing personalities are often preferred to quieter candidates, but a team full of leaders isn’t going to get anywhere. In an article by the Harvard Business Review, authors Elena Butler and Shreya Kangovi describe how in the medical world hard skills are often prioritized over important personality traits such as empathy. It’s common practice to hire someone who is qualified on paper and then try and teach them empathy, instead of hiring the people with the right personality for the job and then teaching them the hard skills they might not be familiar with yet.

 

Dealing with Conflicts

Of course, with the introduction of a diverse workforce, conflicts can arise. It’s important to remember that conflicts arise in every workforce. What’s important is that your company is ready to handle it fairly. This requires a well-prepared HR department that understands how to manage conflicts between two parties that might have very little in common. When discriminatory practices extend to the HR department, your company will likely end up with a lawsuit.

Avoiding a Hostile Work Environment

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A recent article in the New York Times paints a picture of two very different experiences of medical school and working in medical fields; those who experience microaggressions and those who don’t even see them.

The article was written by Dr. VJ Periyakoil (@palliator) who has been working on Stanford University’s Project Respect, which is dedicated to enlightening and advising people on how to avoid making coworkers feel uncomfortable and unwelcome, and instead steer them towards “microvalidations:” small actions that help peers feel valued. The project goes into examples of microaggressions and how people nearby might be able to step up and diffuse the situation.

 

What Are Microaggressions and How to Avoid Them

Microaggressions are small actions that often don’t feel like they’re worth the trouble of calling out in the moment but can stick with the recipient for hours or days after the incident. They can build up to a hostile work environment, making (usually) women and minorities always feel second best in positions that they earned. 

Examples:

  • Making uncomfortable comments about private lives
  • Making jokes about sexuality or gender
  • Making comments in which the peer’s abilities are questioned
  • Not including peers in discussions or activities

 

The Respect Project explains that the people making such comments are often well-intentioned and are making the comments as a joke. Pointing out that such jokes are in poor taste can make it feel like the situation is turning uncomfortable, but it’s important to remember that the comment made the situation uncomfortable, not pointing it out. 

The best way to avoid microaggressions is by calling them out. The most effective group for making this point are the onlookers, not the person being targeted by the comments. It’s not uncommon for the person making the comments to get defensive if the person they were talking to calls them out, but if the person being targeted has support it makes it clear that such behaviors aren’t welcome in that workplace. If the person continues to behave in such a manner, they might end up in a harassment suit.

 

It’s Time To Embrace Microvalidations

So what are microvalidations? Using context clues and a basic understanding of word structures, it can be deduced that they’re small actions that uplift peers. These are NOT comments about looks or ability based on gender or race (i.e. “you’re looking nice today,”  “you’re doing pretty good work for a woman,” and “wow you’re so relatable even though you’re not white!” are NOT compliments). 

Examples:

  • Smiling (NOT winking)
  • Showing appreciation for work
  • Complimenting/recognizing good work
  • Including peers in activities (asking peers out on dates DOES NOT count)

 

Microaggressions can come from anyone, and anyone can be a recipient. Some groups are more likely to be recipients, but that doesn’t mean that anyone is exempt from the ability to feel harassed or discriminated against due to ongoing bullying. 

Similarly, no one needs to be excluded from making or receiving validation. If you see someone doing something right, tell them. Diverse workplaces aren’t going anywhere anytime soon, and it’s important to embrace the challenges they provide.

Why the CEO of McDonald’s Stepped Down

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McDonald’s CEO Steve Easterbrook recently stepped down from his position in the company after a company investigation found he had been in a relationship described as “consensual” with an employee. Specific details of the relationship, including the employee’s name, are not public, but Easterbrook has admitted the relationship was a mistake and unprofessional in official comments. Despite the details not being known, we can still inspect why it was for the best that Easterbrook left.

 

If it was consensual, what’s the problem?

Relationships between employees are against company policy, and enforcing that policy is important for keeping everyone safe. This is because of:

Power Dynamics

If one party in the relationship can control whether or not the other party gets promoted or has a job, it can make the relationship damaging for the work environment and potentially cross the line into workplace harassment. Even if the less distinguished party verbally consents or initiates the situation, it is the responsibility of the more influential party to stop the relationship to protect both of their positions. Relationships between parties of similar positions are different but still aren’t a great idea. 

 

Potential for Discrimination

Even if power dynamics are not a problem between the parties in a relationship, gender and sexuality often are in the workplace. Women who have been in relationships with coworkers are treated very differently than men in the same situation. The same can be said for same-sex couples when compared to heterosexual couples. Consensual relationships can end, and private relationships can easily become public. This can open both parties up to workplace harassment, which can be severely damaging to productivity and, more importantly, the mental health of the employees.

 

Shouldn’t We Be Focusing on Abusive Relationships?

Yes. We should. Unfortunately, we often don’t. Large companies have a terrible reputation for protecting executive-suite employees at the expense of abused employees in imbalanced relationships through the use of non-disclosure agreements and settlements. Serious cases of sexual harassment can be easily covered up by policies saying that personal relationships are allowed in the workplace, which is why revising those policies is so important. Ending abusive workplace relationships should be the end-goal of restricting inter-employee relationships. 

 

Company relationships are complicated and should be handled with care. Steve Easterbrook has probably made the most responsible decision by stepping down without argument. As the CEO of the company, any relationship he would have had with an employee would have had a severe power imbalance, and due to the company’s need to find it through an investigation, it probably wasn’t above board. Easterbrook is providing a good example to those caught in similar situations; it’s better to admit your mistakes and remove yourself from the equation than to deny everything and lead a company while surrounded by mistrust.

JUUL Continues to Be a Problem

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A recent development in JUUL’s legal history is a new lawsuit from a former employee. The employee is suing due to their wrongful firing after they raised concerns over contaminated JUUL pod shipments. 

 

The shipments, which went out earlier in 2019, contained millions of contaminated pods. Despite knowing of the condition of the products, JUUL did not warn its customers or recall the pods, showing negligence towards their business and their clients.

 

While the defective products have not yet been shown to have caused any deaths, the shipping of the products and subsequent firing of the employee who raised an issue with the action are deeply concerning.

 

The former employee states in his case that executives were banned from discussing product issues over text, email, or written medium, and that the ex-CEO of the company could be quoted as saying: “Half our customers are drunk and vaping like mo-fos, who the fuck is going to notice the quality of our pods.”

 

This is a disturbing, but not a wholly surprising turn of events from JUUL, and it is unclear where the lawsuit will go. Spokespeople from the company have wholly denied the former employee’s claims.

PG&E’s Liability

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Recent California news cycles have thoroughly covered how the top utility company of the state, Pacific Gas and Electric (PG&E) has been preemptively shutting power off to millions of homes in an attempt to reduce fire risks. If you’ve been following the news, you’ll also know that half of California is currently on fire. This is due to a number of factors, not the least of which is climate change, but a number of fingers are being pointed at PG&E, and for good reason.

 

History of Mismanagement

PG&E is privately owned by the PG&E Corporation, despite being overseen by the California Public Utilities Commission. The company declared bankruptcy in January of 2019, the second time in two decades. Their prior bankruptcy scandal was due to a lack of statewide utility regulations and lasted between 2001 and 2004. 

The most recent PG&E bankruptcy can be filed up to mismanagement. The past two decades have seen the company regularly neglect necessary maintenance in favor of providing benefits to company executives and shareholders. The failure to maintain power and gas lines has led to the company being held responsible for multiple fires, including the devastating Camp Fire in 2018. 

Much of California’s electric grid is outdated, with power lines that aren’t fire-insulated and trees that need to be removed. Routine fixes can be dangerous, with an average of about 400 utility workers getting electrocuted every year in America. Of course, the best way to avoid being injured by old power lines is to install safer replacements. These replacements not only protect workers, but also those living nearby.

Part of the routine maintenance also includes trimming and removing trees that are interfering with power lines, as they create a huge fire risk, especially in dry and windy areas (i.e. most of California). 

After the Camp Fire of 2018 and its following lawsuits, PG&E was ordered to take responsibility for its necessary maintenance, including removing over 100 million trees that had become risks. PG&E, which was already preparing for bankruptcy, considered it more than its resources could handle to do so. 

 

Our Current Situation

This all leads us to today. Wine country is on fire again, Vallejo is looking like a scene Dante could only dream of, and pretty much all of Southern California is at high risk. While cause cannot be determined until after the fires are controlled, the footage from the start of the Kincade Fire is alleged to show PG&E’s responsibility. Despite the mass power outages, the power station near Sonoma had not been shut off due to the winds not being considered high-risk enough. Unfortunately, that station was suspected to have a serious default, which is thought to have caused the fire.

The Kincade fire has now displaced thousands of families, burned over 66,000 acres, and has destroyed over 40 homes. 

These fires are causing lasting damage, and are becoming more common. While PG&Es mismanagement can’t be considered the sole factor in their increasing frequency, the company needs to see actual consequences for its damage to the state’s infrastructure.

Anheuser-Busch and MillerCoors Come to a Head

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 Trouble started brewing last week when Anheuser-Busch accused its rival beer company MillerCoors of stealing trade secrets for their most popular beers, Bud Light and Michelob Ultra. The relationship first soured when MC filed a lawsuit against Anheuser-Busch for misleading marketing when Anheuser-Busch suggested that their beers were made without corn syrup back in March. The case resulting in a Wisconsin Federal Court Judge ordering Anheuser-Busch to remove the large “NO CORN SYRUP” labels on Budweiser packages, but the bitter relationship continued to ferment, resulting in a months-long dispute.

 

Since the court orders of the Spring and Summer, MillerCoors managed to gain access to the recipes and processes to make some of Anheuser-Busch’s more popular beers. The act was taken as an unfair trade practice by Anheuser-Busch, who continued to bring up MillerCoors’ corn syrup accusations. In a court document draft, Anheuser-Busch is quoted writing “the degree of fermentation of MillerCoors’ corn syrup ingredient is less than 100%,” thus leaving some unfermented corn syrup in the product. This sticky situation has called into question the business law surrounding the beer companies, with both sides tapping top litigators to defend them.

 

The case remains unresolved as of October 22nd, as Anheuser-Busch demands “Trial by jury.”

Why the $50 Billion Opioid Settlement is Laughably Small

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The years-long legal battle with pharmaceutical companies regarding their part in the ongoing opioid epidemic might be coming to a head today, as the top six companies being held accountable negotiate a potential settlement. Should that settlement be agreed upon, it’s estimated to reach close to $50 billion. But given the damage opioids have done to the country, is $50 billion enough?

 

Brief Background

Starting in 1996, Purdue Pharma heavily marketed its drug OxyContin, an opioid, as a non-addictive painkiller with more power than acetaminophen and ibuprofen. Obviously, only one of those claims is true. Since then the prescription opioid market has boomed, making manufacturers ungodly amounts of money and distributing highly addictive painkillers to millions of Americans. Between 2006 and 2012, 76 billion oxycodone and hydrocodone pills were prescribed and distributed. 

Due to increased first-hand experience of the dangers of over-prescription of opioids, numbers of prescriptions began dropping. Numbers peaked in 2012 with 255 million prescriptions, but have lowered to 191 million in 2017. While this looks like a significant drop, prescription rates are still much higher than they need to be. 

In an interactive map released annually by the CDC, users can see numbers of prescriptions per 100 people in a county for any year from 2006 to 2017. Bell County, Kentucky, was lucky to see a drop of over 50 prescriptions per 100 people between 2012 and 2017, unfortunately, that just dropped the number from 281 to 228 prescriptions per 100 people. For context, Bronx County, New York, only had 26.4 prescriptions per 100 people in 2017, a drop from 38.1 in 2012. 

The damages from the epidemic have had a wide-ranging impact on the American economy, which the Washington Post estimates have cost the US upwards of $631 billion. 

 

What Makes up the $631 Billion

Dangerous drugs come with a variety of costs, from treatment to decreasing work efficiency to wrongful death. The Washington Post story breaks down part of their estimate to the costs of treatment and wrongful death, $205 and $253 billion, respectively. The remaining costs relate to decreased work efficiency, absenteeism from work and family, and drug-related incarceration. 

Due to these high numbers, the $50 billion settlement doesn’t even cover half of the losses estimated to have hit federal, state, and local governments ($186 billion). 

 

How Prescriptions Lead to Damages

Opioids are highly addictive, which is known to the CDC, doctors, pharmacies, pharmaceutical companies, PBMs, pop-culture icons, and just about anyone who has been alive in the past 10 years. Unfortunately, this doesn’t stop doctors from prescribing doses that are higher and more ongoing than recommended for safe usage. 

Worker’s compensation and workplace injuries are places where addiction and damages start for a lot of people. Injuries that occur due to physical work can require weeks, months, or even years of physical therapy to fully recover, and pain can often slow down or stop the employee from returning to work. Opioids give the opportunity to return to work quickly without the pain. Unfortunately, the prescriptions provided by workers’ compensation are often much higher than recommended, with workers refilling prescriptions for over 90 days after an incident. According to the CDC, 45% of opioid claims were due to injuries that had been sustained over 2 years prior. 

The chemical dependence of the brain on opioids and natural tolerance build-up over time makes long-term prescriptions dangerous and less effective than advertised. According to the National Safety Council, patients who have been using prescription opioids for over 3 months are highly likely to already be dependent and have a built-up tolerance. The CDC notes that this is detrimental to the economy, as workers with a pain medication disorder miss an average of 29 days per year, almost 3X the 10.5 day average for regular employees.

While workplace injuries are the root of many opioid addictions, any injury or surgery can lead to addiction. Those who have sustained moderate to severe auto accident injuries and need to get back to work are likely to be prescribed opioids, as are those who have undergone minor surgery. I got all four wisdom teeth out just over a year ago and got a nice bottle of 15 Vicodin for my struggles; I ended up disposing of at least 4 of them once I had recovered and no longer felt like I needed serious painkillers. Point being, patients in pain cannot be trusted to deny opioids of their own free will. This is why doctors and pharmaceutical companies need to be held accountable for medical malpractice when refillable prescriptions are given for non-chronic pain (and even chronic pain, given the human ability to build up tolerance).

 

What’s the Proper Response

As shown in cases like lawsuits against JUUL for advertising addictive nicotine products to children, holding companies accountable beyond settlements is incredibly difficult in America. $50 billion is an astronomical amount and would greatly help state and local governments treat and fight opioid addiction, but is only a fraction of the amount that opioids have already cost the country. Ideally, protections would be put in place and enforced to ensure only those who desperately need addictive and destructive substances and provided with them. Ideally, the people responsible for pushing opioids as non-addictive and constructive for chronic pain despite all evidence to the contrary would be put in jail and would have all assets stripped away. But then again, ideally, we wouldn’t be in this situation in the first place.