A VC - Latest Comments in Speaking My Mind

Re: Speaking My Mind

LissIsMore — Sun, 13 Sep 2009 21:01:33 -0000

Bravo! I have not read enough of your political thoughts to know whether I agree or disagree. But I absolutely believe that we should have more discourse, not less, on the issues of the day. Public issues deserve a public conversation. I follow the same path on my own blog. Please continue and ignore those who think you are "not qualified" to speak on any particular subject.

Re: Speaking My Mind

David Smuts — Sun, 13 Sep 2009 06:06:05 -0000

Hey Fred, You would be incredibly boring if all you were able to talk about was VC. Thank God you have a broad perspective; which in any case differentiates you as a VC. As a Brit I just can't fathom why Americans are so divided over a national healthcare alternative? Instead of protesting why don't they offer alternatives and then engage in a meaningful debate? We watch with utter amazement at how so many Americans are being brainwashed and galvanised into protesting against a basic human right= healthcare.

Re: Speaking My Mind

mattmcknight — Sat, 12 Sep 2009 23:26:35 -0000

I thought that the healthcare comment was just way off. The ideas you were presenting were very similar to the ideas of people that have been studying this for years. The fact that the ideas make sense to you (and me) doesn't make them less valid.

Re: Speaking My Mind

COMRADITY — Sat, 12 Sep 2009 20:44:50 -0000

edible currency :}

Re: Speaking My Mind

Rick — Sat, 12 Sep 2009 19:50:26 -0000

None taken. I am a full time physician.

I never said there was a free market for insurance reimbursement. I said I don't have to participate in the market altogether. That is a growing trend, at least in NJ.
CPT codes, or rather how they are administered, are a racket. That, however, is a separate issue that has nothing to do with tort reform.

The study on premiums was performed by Americans for Insurance Reform. The data was pulled from A.M. Best - so what? Data can be interpreted any way a vested organization wants - AIR appears to want to shift the focus to the health insurance companies and away from the malpractice component. This, of late, seems to be the method of the trial lawyers - shift the focus away from us and on to the health insurers.

Both need to be tackled.

I'm not suggesting tort reform bring the # of malpractice cases down to zero, although I'm not surprised that that has happened. The system does not have to be so strict so as to prevent anyone from suing altogether, but place a cap on the payout - so the incentive to hit the jackpot is gone. A patient, with a history of heavy drinking, comes into the hospital with a heart attack, monitored in the ICU, goes into DT's because he's obviously not drinking now, has to be intubated emergently, is difficult to control because of the DT's so keeps moving around trying to pull the tube out, eventually is stabilized. Later develops a breathing problem, known as tracheal stenosis, which he attributes to improper intubation and lack of proper sedation (if he wasn't a alcoholic, none of this would have likely had to been done). Files suit in the millions.

Most tort reformers want an end to frivolous lawsuits. By and large, that's what most of these cases are.

Re: Speaking My Mind

Max Kennerly — Sat, 12 Sep 2009 18:23:12 -0000

Wouldn't you agree that, if juries decided cases on sympathy, they would vote for the plaintiff at least 20% of the time?

Here in Pennsylvania, more than 80% of verdicts are in favor of the defendant. (Google around for the Pennsylvania Supreme Court's annual medical malpractice report, which has the figures.)

Your "cartoon character" analogy shows that you have no familiarity with the legal system at all beyond what you see on television. Good facts win cases; "cartoonish" clients or lawyers lose them. Your comments on contingent fee representation also reveal no understanding of the system -- unlike the hourly-paid insurance defense lawyer, whose incentive is to waste as much time and money as possible, the plaintiff's lawyer's incentives are aligned precisely with those of the client. Your concern-trolling about sharing the client's pain is downright offensive: the defendant caused the pain, which can never be taken away. All the civil justice system can do is award money; that is not the fault of the plaintiff's lawyer.

Plaintiff's lawyers "are able to become" more wealthy than hourly-paid defense lawyers for the same reason startup company founders and investors "are able to become" more wealthy than managers and investors of established companies: they take on far, far, far, more risk.

But don't be fooled: most contingent-fee lawyers are not more wealthy than their hourly counterparts. Take a look at the AmLaw 200 list of the countries' most wealthy firms, which has only a handful of contingent-fee firms (most of whom sue over patents and shareholder fraud) yet dozens upon dozens of insurance defense firms.

Most importantly, though, is this simple question: if you eliminate contingent fees then how, exactly, will you get anyone to represent plaintiffs? There are options, of course, like setting up a compensation system similar to the Vaccine Injury Board, which pays plaintiff's lawyers for meritorious cases, regardless of outcome. But I've never heard any "tort reformer" ever propose anything of the sort, because their single-minded goal is to slash patient compensation as low as possible, not to ensure just results. It's concern trolling, pure and simple.

Re: Speaking My Mind

fredwilson — Sat, 12 Sep 2009 17:32:08 -0000

Hi Jamey. That's good to hear. I've always assumed that was the case with
you and the rest of our investors. But it's really great to hear it.

Re: Speaking My Mind

jsperans — Sat, 12 Sep 2009 17:16:14 -0000

Fred,
For the record: your willingness to speak your mind and engage in open/honest debate is one of the reasons I'm in business with you. Wouldn't want it any other way.
/JS

Re: Speaking My Mind

hypermark — Sat, 12 Sep 2009 15:14:18 -0000

It's actually a blog post that I wrote, not a book, but side comment is that I'm actually loving Kindle app on my iPod Touch. It's proven to be a great 5-10 minute alternative to browsing, emailing and playing games when sitting on buses and trains.

Re: Speaking My Mind

Soph — Sat, 12 Sep 2009 15:05:41 -0000

The internet is an incredible and unprecedentedly fertile ground for creative business development.

It is also where assholes get to spew their embarrassingly hypocritical comments about others. What gives Random Asshole #1 status as an expert about you as a blogger? Seriously.

With good must come bad, I guess.

Re: Speaking My Mind

fredwilson — Sat, 12 Sep 2009 15:01:06 -0000

Thanks for the book suggestion. I hope its on kindle

Re: Speaking My Mind

COMRADITY — Sat, 12 Sep 2009 14:30:08 -0000

This is a reply to JLM and ErikSchwartz too.

Regarding the tendancy of political blogs to reinforce or even harden a view . . check out the book Keenan brought up somewhere on this post or the Failure post - "Mistakes were Made (but not by me)"

I'll write a review on it when I finish it, but the title is a bit misleading. The book isn't just about making mistakes. It's a relatively science-based discussion of how all of our minds adjust to compensate when things that happen are dissonant with our self-image.

This book is an eye-opener for me, further diluting my faith in human nature that anyone will make the logical, rational choice when they know all the facts. Holy Moly after reading this book - I'd say ONLY if they are open to learning all the facts. And I'm learning that when feeling threatened (as many people seem to feel right now) the likelihood of openmindedness shrinks dramatically.

It just may be that Fred's forum has created a context for people who are open-minded and interested in learning. A place where people feel comfortable sticking their necks out to say what they think and are open to feedback.

Katherine Warman Kern
@comradity
www.comradity.com

Re: Speaking My Mind

JLM — Sat, 12 Sep 2009 14:17:45 -0000

Actually the low hanging fruit on tort reform is the cost, complexity and time of litigation, the time value of money, the use of appeals as a fulcrum to leverage settlement and the disconnect between the amount of awards and the percentage actually going to the victim.

A lawyer who takes a case on contingency is no longer representing his client. He is now at best representing his own financial interest while simultaneously singing a sotto voce paean to the client's interest. It has devolved into a purely financial transaction in which the defendant has also disappeared also having been replaced by his insuror's lawyers.

It becomes a struggle between legal gladiators both of whom now possess the paramount interest in the outcome. The plaintiff and defendant are almost cartoon characters once the match is on.

When the financial calculus is finally settled the contingency lawyer invades, dilutes and carts off a huge portion of the victim's just compensation but does not take a proportionate amount of the injury, pain or suffering.

The simple fact that contingency lawyers are able to become very, very, very wealthy --- far in excess of "normal" hourly billing rates --- shows the raw potential for the benefits of tort reform.

Juries are not truly knowledgeable deciders of such complex issues and lawyers appeal to their emotions in a dishonorable and despicable manner. Courtroom histrionics replace sound medicine and science and fairness.

The first phase of tort reform should simply focus on streamlining the process, eliminating the unnecessary financial waste, returning the victim to the center of the recovery and eliminating the sweepstakes element of just compensation.

There has to become an appreciation for the reality that not every procedure works, that the victim may be the cause of the underlying risk, that the failure of the procedure does not always implicate negligence, that there are innocent bystanders (the hospital is not a participant just because the doctor is on staff or the operating room is in their building) and that patients must be forced to contract for the risk involved as a fundamental element of the patient-doctor relationship.

Re: Speaking My Mind

JLM — Sat, 12 Sep 2009 13:58:40 -0000

I agree completely.

We have a standard arbitration clause [AAA Commercial Rules, Expedited Procedures, unappealable decision, single arbitrator, local venue, loser pays, decision filed with and enforced by local District Court] which we have perfected over the years and which is inserted into each and every lease, vendor contract and any applicable legal document. I have simply taken the position that it is non-negotiable and it has worked thus far.

While we have rarely gone to arbitration --- only once in 15 years of using it --- its presence has resolved a lot of disputes. Disputes which would have gone on and on in discovery and have been very costly to remedy. It dissolves the gamesmanship and eliminates huges amounts of cost.

The biggest complainers are the lawyers. It is just incredible to see the unvarnished reaction of the lawyers when confronted with that provision. They are unmasked. And they lose control of the process.

Of course, the securities industry has had such provisions for years and years. At it relates to healthcare tort reform, this would be a good first step.

Re: Speaking My Mind

JLM — Sat, 12 Sep 2009 13:42:17 -0000

On a very serious note, I suspect that the wealthy well educated Mexicans and Canadians would welcome such a merger. It is at the border that all things begin to become stark differences.

Remember also that Mexico has almost no real middle class, no educational upward mobility and no credit. It does not possess an empowering "dream". It does not offer the "dope of hope".

It would be a very cool country.

Re: Speaking My Mind

JLM — Sat, 12 Sep 2009 13:37:31 -0000

Dollars printed on tortillas

Re: Speaking My Mind

JLM — Sat, 12 Sep 2009 13:36:31 -0000

The problem with political blogs is that everyone has their minds made up before they start speaking. You can only learn something if your mind is open, you are receptive to new information and you are asking questions. Giving speeches is not a learning exercise.

Re: Speaking My Mind

JLM — Sat, 12 Sep 2009 13:34:47 -0000

McCain-Feingold does not survive the next session of the Supreme Court by 5-4 or worse

Re: Speaking My Mind

JLM — Sat, 12 Sep 2009 13:32:06 -0000

One of the most puzzling things about politics is the phenomenon whereby very independent thinking and politically entrepreneurial folks run for and succeed in being elected to office to represent a specific community and then go to Washington and lose that strong personal independence, that singular identity and that focused representation and just become part of a "national" party with their views more significantly impacted by what the "party" thinks rather than what their constituency thinks.

This phenomenon is at the root of the town hall meeting food fights. Locals think their guy has become a "national" rather than retaining his local grounding. They fear he no longer represents their view of things. And maybe, just maybe, he does not.

Even more puzzling is the fact that on a one on one basis these politicians often revert to their original form.

I have a local Congressman who is wildly liberal on social issues and with whom I rarely agree on social programs but he is quite conservative fiscally. We will often have lunch and spend a couple of hours talking about business or job creation and you could not tell our conversations apart from one with Newton Gingrich. Some time thereafter the Congressman is using pejorative descriptors about Republicans while during our lunch he was a paragon of decorum and courtesy.

I have a pretty damn thick skin so I am not complaining about using the right fork for shellfish but it is a puzzle to me.

Re: Speaking My Mind

fredwilson — Sat, 12 Sep 2009 11:10:03 -0000

JLM for the ticket bearer of the far center party!

Re: Speaking My Mind

fredwilson — Sat, 12 Sep 2009 11:07:02 -0000

I am a huge fan of loser pays. I am pushing to get it into the patent world. And I agree on arbitration. I have had great experiences with arbitration and not one good experience with litigation

Re: Speaking My Mind

fredwilson — Sat, 12 Sep 2009 11:04:04 -0000

Steve Kane is the guy to lead us there. Or maybe JLM

Re: Speaking My Mind

fredwilson — Sat, 12 Sep 2009 10:48:59 -0000

hi richard and thanks for stopping by and joining the discussion. i'd love to hear your thoughts on healthcare. here are mine

http://www.avc.com/a_vc/200...

Re: Speaking My Mind

fredwilson — Sat, 12 Sep 2009 08:59:02 -0000

Gettin some hyperlocal truth from JLM and showing the power of social media to inform and educate too!!!

Re: Speaking My Mind

fredwilson — Sat, 12 Sep 2009 08:56:02 -0000

And what about canada? Good synergies there too