PADI getting sued over Insurance Program

[The Chairman]

They masquerade as a "newswire".

Damn Jim. I take exception to this statement. Do you then "masquerade" as an instructor because you charge your students? Of course you don't. There is no evil intent here and to suggest such simply shocks me. Most of us EXPECT to get paid when we do something. You, Scott and I are very similar in this regard.

DiveNewsWire and DiverWire run on a different paradigm than AP or the main news wires. He charges his fees up front and DOES NOT edit the content. AP charges the end user (news papers, broadcast news, etc) for the information and they fully vet the content or they would lose their clients.

In fact there is more free news here and on other dive forums that never makes it on to the "newswire" that is much more interesting and relevant.

I'll have to agree with you here. However, people have to DIG for it, and many do not want to do that. Scott sends his releases to busy professionals who don't have the time to scour the net for info. The case could be made that they would be more in touch with us divers if they did, and I see that as true. There is no such thing as "too much information".

Anyone ever remember seeing a bad review of a resort that advertises on there?

You can't read any review on there. Sure, they have one or two "reporters" that might go play at a resort, but it's a paid for gig. If you want peer reviews of any resort, ScubaBoard is the place to find it.

As an aside, and I don't mean to hijack the thread. After months of thought and redesign, ScubaBoard has relaunched it's User Newsletter. Of course, a few contacted me stating that this presents competition for DiveNewsWire. Not really. The newsletter is completely myopic and centers on fun topics here on ScubaBoard. That being said, we are getting ready to launch our second News Letter: ScubaBoardPro. While still being Myopic, it will feature the Web Releases that the various Scuba Entities already put here on ScubaBoard. Everyone who signs up as a "Pro" will be getting this new newsletter. You can do that in Group Memberships by adding all the user groups that apply to you (but only one at a time). Don't worry if you don't get a reply to your request. Unless there is a problem, you will simply be added. The first edition will come out just before DEMA.

 

[Peter Guy]

OK, but now we have a choice of laws issue (law geek issue). Since the plaintiff is an Hawaiian entity, did not the damages occur in Hawaii? Thus is Cal no longer (if it ever had) the legal theory, would not Hawaiian law control? (Even though PADI may not officially be doing business in Hawaii, I'm sure there would be enough of a nexus to allow Hawaiian law to apply.)

BTW, I have no idea if Hawaii has an unjust enrichment cause of action.

 

[theduckguru]

I hate to admit to being wrong, but when I'm wrong, I'll admit it.

I previously posted that I liked the plaintiff's unjust enrichment theory. Like it or not, I was wrong about it being a good theory. The California Court of Appeal, today stated that under California law, there is no such thing as a cause of action for unjust enrichment. It did so in the context of a lawsuit against Blue Shield in which the plaintiff's basic grievance was that Blue Shield did not disclose that his premiums would have been substantially less if he had gotten a policy in which his wife was the primary insured and he was a secondary insured rather than the other way around.

All of a sudden, the lawsuit against PADI is not looking so good.

I don't think that unjust enrichment was really the issue. At issue is the allegations of PADI acting as an unlicensed insurer and being deceptive in their promotion of the insurance program. If they are doing this, yes, they are being unjustly enriched because they are committing fraud.

 

[PuMpUi]

I hate to admit to being wrong, but when I'm wrong, I'll admit it.

I previously posted that I liked the plaintiff's unjust enrichment theory. Like it or not, I was wrong about it being a good theory. The California Court of Appeal, today stated that under California law, there is no such thing as a cause of action for unjust enrichment. It did so in the context of a lawsuit against Blue Shield in which the plaintiff's basic grievance was that Blue Shield did not disclose that his premiums would have been substantially less if he had gotten a policy in which his wife was the primary insured and he was a secondary insured rather than the other way around.

All of a sudden, the lawsuit against PADI is not looking so good.

I think someone should probably call Rick Lesser for this one. I believe that the Class Action against PADI et al was filed in Federal Court in California, but not in a California Superior (?) Court jursidiction, but the incident that started this entire chain-of-events (PADI et al refusing to pay an insureds claim) took place in Hawaii, which has some "different" laws and will be the sate with jurisdiction over that law suit.

I have not read the California Court of Appeals ruling, but it's possible that the ruling stated that IN THAT CASE (Man v BLue Shield) that the theory of unjust enrichment was not an appropriate theory, but I don't know if it means that the theory is not valid in other instances.

Besides, weren't there a lot of other causes of action besides unjust enrichment, like RICO, which is a Federal matter ?

 

[Rhone Man]

I don't think that unjust enrichment was really the issue. At issue is the allegations of PADI acting as an unlicensed insurer and being deceptive in their promotion of the insurance program. If they are doing this, yes, they are being unjustly enriched because they are committing fraud.

Doesn't matter how you frame the action (fraud, breach of contract, misfeasance); unless the claim is based on unjust enrichment, the claimants will have to prove monetary loss to win any damages. And that will be hard to do.

 

[Scubarus66]

AIG Donkeys!!!!!!

 

[ItsBruce]

The new case I mentioned basically says that, at least in California, there is no cause of action for unjust enrichment. The basic premise is that unjust enrichment is a remedy, not a basis for suing someone. To sue someone, there must be a basis, i.e. something that they did that is contrary to law. Just because they were enriched, unjustly or not, is irrelevant unless they have done something contrary to law. Now, if PADI is liable for fraud or for engaging in the business of insurance without being licensed, etc., then, it may have to return sums by which it was unjustly enriched.

The fact this is in federal court does not alter the law in terms of whether something supports a recovery. Besides, most federal judges who are presented with this new case will probably elect to follow it.

I do not know about Hawaii's laws or whether it will be Hawaii or California law. But, without looking at specific Hawaii law, I'd guess a judge applying Hawaii law would also look at it and say that unjust enrichment is a remedy, not a cause of action.

 

[ReefHound]

I previously posted that I liked the plaintiff's unjust enrichment theory. Like it or not, I was wrong about it being a good theory. The California Court of Appeal, today stated that under California law, there is no such thing as a cause of action for unjust enrichment. It did so in the context of a lawsuit against Blue Shield in which the plaintiff's basic grievance was that Blue Shield did not disclose that his premiums would have been substantially less if he had gotten a policy in which his wife was the primary insured and he was a secondary insured rather than the other way around.

I don't see any unjust enrichment here. Since when is it the responsibility of a business to tell a customer how to better arrange his purchase in order to get the lowest price? Unless he asked and was given false information, I don't see where BCBS did anything wrong.

 

[PuMpUi]

Doesn't matter how you frame the action (fraud, breach of contract, misfeasance); unless the claim is based on unjust enrichment, the claimants will have to prove monetary loss to win any damages. And that will be hard to do.

"IF" this is true, then it's Game Over and let's all just go home ...

But then again ....

"IF" my Aunt had a pecker she'd be my Uncle. (We have some pretty crazy family dinners around the holidays )

 

[ItsBruce]

There is an old latin saying that is applied in the legal field: "damnum absque injuria." It is basically the notion that just because someone does something wrong, that does not mean there is an injury or legal remedy.

Although the particular lawsuit may end up going nowhere very fast, if what the complaint describes as the program is accurate and is against the law, it is possible that the court would enter an injunction prohibiting PADI from continuing it. In that case, the court could award plaintiff's counsel legal fees for having brought about a public good. In California, it is called the "Private Attorney General" doctrine. The basic idea is that it is the State Attorney General's responsibility to stop things like illegal insurance schemes, etc. If the State Attorney General does not act, an individual may act and if there is a public benefit, the individual's counsel gets paid for having brought the lawsuit.

What I don't get is why the plaintiff is not suing on a theory of "insurance bad faith." To win such a case, the plaintiff must show that an insurer unreasonably withheld or delayed the payment of benefits and that this resulted in damage that would not otherwise have occurred. As with the existing lawsuit, the plaintiff would have to prove PADI was selling insurance, whether licensed or not. (I don't think that it is a defense to say "I'm not a licensed insurer." See Cal. Ins. Code. §22.) The plaintiff would have to show that PADI acted unreasonably, which is probably the hardest part, but insureds regularly show that of their insurers. And, to a business that has suffered a loss, delay in payment of a claim usually equates to a delay in getting back in operation and therefore monetary damage.