Internet Use (To Catch Abuse)

The effective use of Internet resources in claims and defence files.

Nawaz Tahir and Meredith Jones | September 14, 2009

• Announcing the CI Legal Expert Panel
• Another Twist to Consider—The Allstate Case
• Competition is Fierce—Restrictive Covenants in the Shafron Case
• Internet Use (To Catch Abuse)
• Facebook Litigation Grows
• Proof—Roles of Adjusters and Lawyers in Fidelity Recovery
• Best Practices for Successful Subrogation Recoveries
• State of Securities Class Actions
• Professional Liability and Securities-Related Claims Trends
• Misguided Critique of Covert Surveillance
• Employee Termination—A Risk You Can Manage
• Using Data Analytics to Maximize Company Performance
• Give It Up—Vehicle Fires & Frauds
• Overview of Detection & Investigation Techniques

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Technology has changed the way our world conducts business. It has made the world smaller by opening doors that did not previously exist and by exposing millions of people to things they would not otherwise experience. The changes brought on by this electronic revolution are nothing short of spectacular.

But in a risk-averse community, such as the P&C industry, the reluctance to adopt new technology can prompt a lag. Given the pervasive use of social networking, and technology in general, by consumers and businesses, claims professionals and legal defence counsel must examine how and where to adopt a more vigorous use of the infinite amount of information in the cyber world. The earlier the adoption of these communication tools, the more efficient this process will become and the better the overall results for claims and defence handling.

Facebook: What is it and how is it used?

Facebook is a popular, free-access social networking website that is operated and privately owned by Facebook, Inc.

Users can join networks organized by city, workplace, school, and region to connect and interact with other people. Facebook permits users to create profiles including photos and lists of personal interests, exchange private or public messages, and join groups of friends. The website is free to users, but generates revenue from advertising.

Launched in 2004, today Facebook has more than 120 million active users worldwide. It is the leading social networking site based on monthly unique visitors, having overtaken its main competitor MySpace in April 2008. One study found that 90% of university students report using Facebook daily.

(1) How does Facebook work?
As a social network site, Facebook was built to be extremely user-friendly. To create a profile, users need only an e-mail address recognized by Facebook. Once a user has established a profile, they can update it as often as they like. Users can add or change their information including pictures, “favourites” and blog-type entries. Users can build networks of “friends”—  “friends” are other Facebook users who have agreed to be added as friends to a user’s profiles.  Users can also join networks organized by city, workplace, school, or region to connect and interact with other people in those networks.

(2) Posting photos on Facebook
One of the most popular applications on Facebook is the photo application, which allows users to upload albums and photos. One of the most attractive features of the photo application is that Facebook users can upload an unlimited number of photos, while other image hosting services limit the number of photos that a user is allowed to upload.

Another appealing feature of the photo applications is the ability to "tag," or label, other Facebook users in a photo. For instance, if a photo contains a user’s Facebook friend, then the user can tag the friend in the photo. “Tagging” another user sends a notification to the friend that they have been tagged, and provides them a link to see the photo. Tagging a friend in a photo also posts a notice on both the user’s and the friend’s “wall” alerting others that the photo(s) has been posted and/or tagged. The user does not need to obtain the “tagged” friend’s permission in order to tag them in a photo. However, the “tagged” friend has the ability to “untag” themselves if they so desire.

(3) Facebook Privacy
A recent study, by University of Guelph researchers, found that the need for popularity is driving young adults to disclose more personal information on Facebook than they normally would reveal.

The study found that the majority of people (76%) are concerned about privacy and information control, yet they still disclose a great deal of personal information on Facebook. This includes details such as birthdays, email addresses, hometowns, school and/or place of employment, “status” (the options are: single, in a relationship, engaged, married, “it’s complicated” and “in an open relationship”) and even intimate photographs.

This study asked students to rank on a scale of one to seven how likely they were to post various types of pictures. “Profile” pictures of themselves, and pictures with friends or dressed up formally were most common, earning a mean ranking of more than six out of seven. Photos that depicted them "doing something illegal"—doing drugs, deliberately provocative shots and naked or partially naked photos—were deemed least acceptable, earning ratings of 2.45 and 1.49 out of seven, respectively.

In light of obvious privacy issues, Facebook does allow users to control the privacy associated with their profile, news feed, photo albums and “wall.” It also allows users to control who can search for them, how they can be contacted, and what information is available to applications linked with their profile.

To protect their privacy, users can limit their profile so that only those other users that they have accepted as friends can see their profile. On the other hand, profile privacy can be set to allow any other user on Facebook to access a user’s profile. For photos, privacy settings can be set for individual albums, limiting the groups of users that can see an album. For example, the privacy of an album can be set so that only the user's friends can see the album, while the privacy of another album can be set so that all Facebook users can see it or so that only friends of friends can see it.

(4) What The Courts Say
Yet despite this ability to select privacy settings, Justice Brown recently held that a party who maintains a private or limited access Facebook profile stands in no different position than one who sets up a publicly available profile. Justice Brown held that parties are obliged to identify and produce any Facebook postings that relate to any matter at issue in an action, irrespective of whether they are posted on a user’s public or private profile.

Gathering and Using Facebook Information

Facebook can be an incredibly valuable tool for collecting information on other users. A user can browse Facebook profiles based on criteria such as age, relationship status, or search the entire Facebook database for people using their name or e-mail address. As a user, you can contact other users through private messages or public notes on their profiles.

If a user’s privacy setting is set to allow any other user of Facebook to access their profile, the information accessible to the public is limited only by what information the user has chosen to post. This can include information such as their name, birth date and “status,” their religious and political views, a list of their hobbies and interests, and their current or past place of employment. Almost certainly, there will be a range of personal photos. In these circumstances, Facebook can prove to be a priceless tool when investigating the background of a claimant.

In other instances, a user’s profile will not be available to all other Facebook users but will be open only to his/her friends. In these circumstances, the information available to a non-friend will be limited but, with some creativity and time, it is still possible to find valuable information on a user by searching his or her friends who may have open or public profiles. Moreover, even users with “limited” profiles will sometimes create a “public” profile—a page with only selective information accessible to all Facebook users and, in some cases, accessible through an internet search engine like Google.

The evidence provided by information and photos found on Facebook, or even the mere fact that someone has a Facebook profile, can prove to be an invaluable tool for assessing the value of a plaintiff’s claim for damages both at trial or in settlement discussions.

Social networking tools, like Facebook, seem to be specifically useful when dealing with a plaintiff who claims that their everyday social activities have been compromised. For example, in Goodridge (Litigation Guardian of) v. King, Justice Platana concluded that the scarring on the plaintiff’s face did not substantially interfere with her everyday life. Justice Platana based this finding, in part, on the fact that the plaintiff continued to socialize and date (as evidenced, in part, by Facebook information) and even went to the extent of providing her picture on Facebook.

A very similar conclusion was reached in Kourtesis v. Joris. In that case, the plaintiff’s testimony had left the court with the impression that the plaintiff did not have a social life and that her enjoyment of life was significantly diminished. However, Justice Browne ultimately concluded, based on the strength of the Facebook photos produced at trial, that the plaintiff did in fact enjoy life and, contrary to testimony given by her and her family, she continued to enjoy an “active social life”.

In other cases photographs (and other Facebook information) can also be used by a defendant in order to impeach a plaintiff’s credibility regarding the impact of an accident on his/her life, depending on the evidence at trial and what the photographs depict.

In Murphy v. Perger, on a motion for production of copies of the plaintiff’s Facebook site, Justice Rady, after considering the “competing interests” of privacy and relevancy, ordered the plaintiff to provide the defendant with copies of the web pages posted on the plaintiff’s Facebook site.  Justice Rady concluded that any invasion of the plaintiff’s privacy was minimal and outweighed by the defendants’ need to have the photographs in order to assess the case. Justice Rady commented that the plaintiff could not have had a serious expectation of privacy given that 366 people had been granted access to her Facebook profile.

Preserving and Accessing a Facebook Site

At the stage of preliminary investigations, Facebook may offer some helpful insight into the claimant’s life and simply taking a “web shot” or printout of that information might be sufficient for some purposes. However, in cases where Facebook evidence may ultimately be used at trial it is important that the information be preserved.

Rule 45.01 of the Rules of Civil Procedure grants courts jurisdiction to make an interim Order for the custody or preservation of any property in question in a proceeding or relevant to an issue in the proceeding.

On the strength of the case law discussed above, it is arguable that a claimant’s Facebook photos will be relevant to an issue in a personal injury action, are admissible at trial and, as such, should be preserved.

For that reason, an Order for the preservation of a Facebook site is crucial given that a claimant, once aware that a defendant has knowledge of his or her site, will almost certainly alter or change their profile to remove any photographs, text and/or other information that may be harmful to the claim they seek to advance.

Use of Google

Another powerful technological tool is Google. The short history and growth of Google is the what entrepreneurial dreams are made of—started in January 1996 as a research project by Larry Page and Sergey Brin, a Ph.D. student at Stanford University, the goal was to “to develop the enabling technologies for a single, integrated and universal digital library."

The thesis project turned into a search engine, with the original domain for the site housed on the Stanford site. By September 1997, the google.com domain was registered, and a year later the business was formally incorporated.

The name "Google" originated from a misspelling of "googol."

Using Google Maps: Another Internet Resource

Since its beginnings, Google has evolved as one of the leading resources on the Internet.

For claims adjusters and counsel, there are a number of ways Google, and other search engines, can be used to help with claims files.

(1) Google Alerts
Many of us are already familiar with the power of a Google search, however,  Google Alerts offers that power 24-hours-a-day, seven-days-a-week. As with a regular Google search, Google Alerts allows users to enter almost any topic (name, property, product, VIN number, etc.). Users can then tell the program how often they want a report to be generated (for example, real-time, once a day, once a week). If, and when, an item appears that meets the user’s search criteria, Google Alerts will send the user an email.

(2) Google satellite (or Google Earth)
Our firm recently handled a case where a pedestrian sued the insured of our principal in a motor vehicle accident. As part of the initial investigation, we received a statement about how the accident occurred. On the face of it, the statement was quite ‘normal’ and quite plausible—the Plaintiff was walking to the store, crossed the street, and was struck by the defendant.

Prior to centralized claims handling, a local adjuster may have recognized the location of the incident and been able to red-flag issues related to this case. In this situation, however, no red flags were issues, as no perceivable problems were noticed.

However, by utilizing Google Maps—and clicking on the satellite option—the scene was viewed in real-time and red flags began to emerge.

For example, as seen in the map above, we were able to see that the Plaintiff chose to follow a path of shortcuts through various parking lots (the “Plaza”), and then proceeded to jaywalk across a busy street, instead of making use of the nearby traffic lights. From this imagery, we were able to develop a case theme and strategy that revolved around the Plaintiff’s actions—a conscious choice to take a short-cut and jaywalk, instead of crossing at the designated crosswalk, notwithstanding the reverse onus for pedestrian accidents (which shifts the onus to the driver to show that he/she was not negligent).

This defence, however, would have been impossible to determine and construct, had it not been for the imagery obtained through easily accessible and publically available Internet sites. It should be noted that this case resulted in a very favourable apportionment of liability in the action.

(4) Other Sites
Other sites that are often helpful with respect to liability include:

• Ministry of Transportation has images captured by traffic cameras. These images are archived for a certain time period (London, GTA, Sarnia, Niagara and Ottawa are presently online).  The site also has links to extensive City of Toronto and City of Ottawa cameras.
  www.mto.gov.on.ca/english/traveller/trip/traffic_cameras.shtml
• Streets of Canada is a photo database that allows instant access to accident locations using computer and an Internet connection. A paid service it provides an online database of digital photographs of the nation’s street intersections to adjusters and insurance professionals. The databases also records important general statistics that can be useful to the insurance industry, such as the most often accessed intersections, concentrations of claim reports, etc.
  www.streetsofcanada.com
• Environment Canada is a website that provides an archive of weather data and can be used to find historical weather data on any day in most Canadian cities. Useful for slip and fall cases, and for motor vehicle accidents (MVAs) where weather was an issue. Information includes data on temperature, wind, visibility and weather conditions.
  www.climate.weatheroffice.ec.gc.ca/climateData/canada_e.html

Determining Damage Assessments

Whether for setting reserves, trying to get authority to settle a file or analyzing an offer to settle, a chief element of claims handling and defending lawsuits is trying to put a value to a claim.

In once case, we used online tools to evaluate a settlement offer received from Plaintiff’s counsel. In this example:

• The plaintiff’s name is Isa Payne;
• She is female;
• Aged 33 (born January 1, 1976);
• She was a security agent before the accident;
• In the motor vehicle accident, she suffered soft tissue injuries that have developed into chronic pain;
• The medical opinions are all in agreement that she can only work at a sedentary level now;
• She went to college to become a customer service representative at a bank—a position that our vocational rehabilitation expert says the plaintiff should be able to do.

Plaintiff’s counsel had suggested the sum of $400,000, plus interest and costs, to settle the matter, on the basis that the plaintiff cannot go back to her original job, and is severely compromised in ever being employed again.

The first step was to calculate the Payne’s pre-accident earning potential. Her tax returns show a gross income to be $29,500 per year. Accordingly, up until the age of 65, the value of Payne’s loss of income (before any deductions or analysis) would be $766,690 (using the prescribed Ontario Discount Rate). As prescribed, we would apply a 25% contingency, as there are various factors that suggest she would not be a security agent until the age of 65.  That leaves a potential loss of income claim at just under $575,020.

The next step is to calculate the potential ‘residual’ income. However, all we have been given by our vocational expert is a potential job occupation—no financial data or comparative salary information was provided. In order to determine this information, we examine two online sources:

1. Service Canada; www.labourmarketinformation.ca; This site offers various wage and salary information based on the geographic area you specify. For example, the site provides an idea of what people are paid in various occupations across Canada. It is a helpful tool for putting together raw information about residual income loss issues.
2. FSCO; www.fsco.gov.on.ca/English/insurance/auto/dacs/rectables.asp; The Financial Services Commission of Ontario site provides similar information to the Service Canada website, including Residual Earning Capacity (REC) Wage Tables up to 2007.

To get a gain a better appreciation of how these web tools work, we will use the Service Canada website to explore the Payne case.

Using the website we can access wage data for any province or territory, and for many individual municipalities. Once this basic information has been sourced, we can search by Occupation Title, or “NOC Code”, for the plaintiff’s anticipated post accident occupation, ie: bank teller.

In this case, the data from Service Canada tells us that a customer service officer in a bank can make about $14.69 an hour (on average). This works out to $28,645.50 (CDN) annually.

To get our annual shortfall, we then take that annual figure ($28,645.50) and apply it to the pre-accident annual earning capacity. This works out to an annual shortfall of $855.

To calculate the present value of the shortfall to the age of 65 we need to consult a present value calculator. There are several calculators available online:

1. Brown Economic Consulting: www.browneconomic.com/index.html
2. Rich Rotstein Chartered Accountants Inc.: www.richrotstein.com/infoart/statistics.html#
3. McKellar Structured Settlements Inc.: www.mckellar.com/page.php?id=88

Using any of the above online calculators, we determine that the present value of the future income loss is $22,221.02.

While this information is not admissible in court (an expert and/or report would be needed), it is still useful information, as it will help in assessing the case and, more particularly, the offer made by plaintiff’s counsel. In the case of Payne, and mindful that there is always additional amount added on for general damages, it is easy to recognize that the offer from Payne’s counsel is unreasonable. Apparently, from the calculations, plaintiff’s counsel did not factor in residual income when making the offer, even though it looks like he/she gave a “discount” on the gross future income loss total.

Medical Information

There are also a number of sites available online that provide reference material to help you understand medical issues that you may be confronted with in the course of analysing a new file.

Without overstating the obvious, these reference materials are not a substitute for a proper medical opinion, but will provide claims professionals and defence counsel with some preliminary and basic medical information to assist in understanding and handling a file.

(1) Medical Abbreviations
www.media4u.com/bbp/medabb_f.html
This site has over 10,000 abbreviation definitions.

(2) RxList
www.rxlist.com/script/main/hp.asp
This internet drug index can be used to look up various prescription drugs.

(3) Medical.com
www3.searchmirror.com/?u=medical.com&o=mjj76dha22mjj76dha22_1_1
This page serves as a gateway to an array of medical information, including terminology, procedures, and prescription information.

Another related, more general resource is www.webmd.com.

There are many resources available in the cyber world that can be of assistance in our day-to-day claims handling work. The key to maximizing these Internet resources is to know what they are, how they work, and how to use them effectively. We must also understand their limitations and recognize that Internet resources are to be used in conjunction with, and not to the exclusion of, thorough and complete investigation.

One final Internet resource is the Lerners LLP Insurance Defence Blog: www.lerners.ca/insurancedefence/blog.cfm. This blog contains comments and updates on some of the latest cases and trends in the insurance industry.

Nawaz Tahir, partner at Lerners LLP, and Meredith Jones, associate at Lerners LLP.

NOTE: Nawaz and Meredith would like to thank Grant Bodnaryk, an articling student at Lerners LLP, for his assistance with this paper. The listed information is not an endorsement of any website or online service.  The authors are not responsible for any misuse of the above sites/services, nor do they warrant or vouch for the accuracy of the information on those sites.  As always, all proper internet security measures should be taken when browsing the above sites.