Monday, January 24, 2011

The Mystery of the Missing $Millions in Claims, Part 2

More from guest blogger and co-objector Anita Bartholomew on the "Freelance" settlement parties' deceptive representations to the Second Circuit Court of Appeals on claims data.

To recap Part 1, in 2006, Michael Boni, the class action attorney purportedly representing freelance writers in the Freelance Class Action, had to rescind his statement to the court that freelance claims totaled just $10.76 million. He admitted the actual total could be much higher. The reason: the administrator had valued at least hundreds, and possibly thousands, of registered articles as if they were unregistered. Registered claims are worth, on average, from about 8.4 to 91 times the value of unregistered ones.

Then, in 2010, without any explanation, Boni told the appeals court that the claims total was $8.9 million -- $1.86 million lower, not higher, than the admittedly too-low $10.76 million figure he’d given in 2006. $Millions in claims simply vanished?

So much for the recap. On to Part 2.

In January 2011, Michael Boni wrote a new letter to the court saying that the administrator made yet another calculation error.

The settlement was amended in 2005 to bump up some former category B claims (registered but not timely), if infringed by two new Defendants in the class action, Amazon and Highbeam, into the higher paying A category. For details, see:

But, as Boni told the court earlier this month, the administrator had failed to value those original B claims as A claims. Boni now says that, as a result of correcting the error, the claims total has gone from $8.9 million to $11.56 million.

But wait: he never explained how it got DOWN to $8.9 million in 2010, when it should have gone UP by some unknown amount above the $10.76 million figure he gave the court in 2006.

If we were to add this new $2.66 million to the (too low) 2006 total of $10.76 million, the lowest possible total we get is $13.42 million. But we know that the total MUST be greater than $13.42 million, because (Boni told us) that the correct total would be greater than $10.76 million.

How much greater? He wouldn’t tell us. Neither would the defendants.

So, let’s look at the numbers we do have.

2011 reported error: The administrator wrongly classified about 2,300 category A claims (average value of A claims=$1,316.00) as if they were category B claims (average value of B claims=$156.00), which added $2.66 million to the claims total. The actual value of the affected claims was roughly 8.4 times greater than the administrator originally calculated.

2006 reported error: The administrator wrongly classified at least hundreds, and perhaps thousands, of category A and B claims (average value of A claims=$1,316.00; average value of B claims=$156.00) as if they were category C claims (average value of C claims=$14.50), which added $XX to the claims total. The actual value of the affected claims was roughly from 8.4 to 91 times greater than the administrator originally calculated.

What is the value of XX?

My best guess is north of a million dollars. Looking at the above, what’s yours?

And when you’re done best-guessing, please contact the purported attorney for Plaintiffs (this means he’s purportedly your attorney), Michael Boni. Ask him how a correction that INCREASED the value of hundreds or thousands of claims by as much as 91 times their originally calculated value REDUCED the claims value total by $1.86 million!

While you’re at it, ask him another obvious question: whose claims aren’t going to be paid? And why won’t they be paid?

I can’t help recalling how, from the beginning, attorneys for Plaintiffs and Defendants insisted in court that the claims totals could not possibly exceed $11.8 million. (Because anything above that would mean that unregistered claims wouldn’t be paid in full).

The only conclusion I can come to is that somebody did something to ensure that this false statement came true. What did that somebody do? I don’t know. Does it affect YOUR claims? I wish I could tell you, but again, I don’t know.

Michael Boni knows: 610-822-0201;

Maybe he’ll explain… or maybe, you’ll get the same bogus “explanation” that “someone” tried to peddle to us.

If you do ask Mr. Boni for an explanation, please be sure to come back here and post his response in the comments, so we can let you know whether it’s plausible. We need answers. Accurate answers. And we’ll only get them by holding to the fire the feet of those who have them (and are supposed to be on our side).

- Anita Bartholomew


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