Saturday, December 24, 2011

Monday, December 19, 2011

The Cosmo and Me, Part 3 - How Wall Street screwed me

I last wrote about our experience with the Cosmopolitan of Las Vegas last January and before that almost exactly one year ago to the day. To recap briefly, in 2005, back when buying real estate still seemed like a good idea, we bought a condo at the Cosmo. Then the recession hit, the developer went bankrupt, and the project was acquired by Deutsche Bank. Astonishingly, despite an almost perfect storm of bad economic conditions, the Cosmo actually got built.

But we didn't get our condo. The Cosmo took it from us, along with half of our down payment. The short version of the story is this: they finally finished building our condo, two and a half years after the promised delivery date and six months after the Cosmo opened, but they didn't tell us. The sent a closing notice to our old address in Los Angeles, but not to our new address in northern California, and so we never got it. When we called them on this their response was: you never notified us of your new address.

Now, that is manifestly untrue, and we can prove it. The Cosmo had been sending us correspondence at our new address for nearly a year, and of course we've kept it all. We can also prove that we sent them correspondence with our new address on it via certified mail as required under the contract.

What we cannot prove is that we sent via certified mail a letter saying, "Please note: our address has changed." The contract specifies that change of address notices have to be sent via certified mail.

Now, there is a legal principle called "implied waiver" that should apply in this case. Because the Cosmo sent us correspondence at our new address, that constitutes an implied waiver of the requirement that we notify them of our new address via certified mail. If we could count on getting justice, we would patiently wait until we got our day in court. Unfortunately for us, the contract also includes a binding arbitration clause, so we can't sue them. A number of people in situations similar to ours have already gone to arbitration. And one by one they have, with a very few exceptions, lost their cases.

I've read some of the decisions in those cases, and they are brazenly biased in favor of the Cosmo. In one case, it was so brazen that even the judge overseeing the case couldn't take it and ordered the arbiter to go back and redo part of it. I know of only one person who has prevailed in arbitration. In every other case I am aware of, the Cosmo has won, and the buyers are left with nothing. No condo, and no refund of their deposit. It is theft on a vast scale. And it's all legal.

Back in January I speculated about why the Cosmo seemed so confident in its position despite the fact that we have what should be a slam-dunk case against them. Now I know the answer: the fix was in from the beginning, and they knew it. The Cosmo employs 5000 people in a city that has been one of the hardest hit by the recession. The arbiters live in that city, and apparently they know what side their bread is buttered on.

Last week the Cosmo made a settlement offer to the few stragglers who are still under contract with them: we get 50% of our deposits back. They keep the rest. And despite the fact that it is a manifestly unjust outcome, we're going to accept it because the alternative is to continue to have this hanging over our heads for got only knows how long with the virtual certainty of losing 100% of our deposit to the decision of a biased or corrupt arbiter in an unappealable decision.

Lesson learned: never sign a contract with a large corporation that includes a binding arbitration clause. You will lose, and they know it, so you have no leverage at all. If they decide to screw you, you will be screwed.

My dismay over this extends far beyond the financial loss, which is considerable, but won't really have a major impact on me in the long run. What bothers me most is that I really believed that justice would prevail in the end, that at the end of the day (or the decade as the case may be) we would get our day in court, or at least in front of an arbiter, and we could present our case and be able to count on getting a fair decision. That faith has been shattered. If justice still exists at all in the United States of America (if it ever existed?) it seems to have become the rare exception rather than the rule.

Happy holidays.

Monday, December 05, 2011

ANNONCEMENT: "But for the Grace of God?" available on iTunes Jan 9

I'm thrilled to announce that my movie But for the Grace of God? is going to be released at long last! It will be available on iTunes on January 9, and should be on Netflix shortly after that.

I've started a new blog for the film where I am going to be posting announcements, deleted scenes, and anecdotes in the runup to the release. Posting over here at the Ramblings will probably be light for the next month or two, so if you want to stay in the loop please go subscribe to the Grace of God blog.

Friday, December 02, 2011

The ants shall inherit the earth

Humans are not the dominant species on this planet. Neither is the domestic house cat, though one might be forgiven for drawing that conclusion. No, that honor belongs to the Argentine ants. We were invaded by the very ironically named Linepithema humile last night, and the ensuing battle lasted well over an hour as we vacuumed, sprayed, swept and wiped the little critters from nooks, crannies, cat food dishes and trash cans. (Thank God they had not yet discovered the pantry.)

If ever you need proof that cooperation and altruism can evolve through Darwinian evolution you need look no further. The Argentine ant is one of the most successful species on the planet. But why? They have neither brains nor brawn, no armor, no sting, no bite. They are in fact, if you look at an individual ant, one of the most innocuous creatures you could ever hope to encounter. They're disarmingly unthreatening, almost cute. And if you want to dispatch one you can just squish it like, well, a bug.

But considering an ant as an individual entity is a serious mistake, every bit as wrong as considering one of your white blood cells to be an individual. Notwithstanding that they are not mechanically connected to each other the way the parts of your body are, ants are in fact just components of a fundamentally different, much larger, and far more intimidating whole, the ant colony. Kill an individual ant, or even slaughter them wholesale, and the colony goes on.

So what makes the Argentine ant so singularly threatening among all the species of colony-forming insects in the world? It is that Argentine ant colonies are structured in a fundamentally different way than all of the others. Nearly all other insect colonies are organized around a single individual insect who lays all the eggs. We normally call this insect the "queen" but a more accurate description would be an ovary. This individual or organ, depending on how you choose to look at it, is the colony's soft spot, its Achilles heel. Kill the queen and you kill the colony.

In addition, most insect colonies have a sense of identity based on their genetic identity (since all the individuals in the colony have the same mother). So while the individual ants in a colony will cooperate like the cells in your body, individual colonies will compete with each other for food and territory.

Argentine ants aren't like that. A single colony can have multiple queens, and when Argentine ant colonies encounter each other, they don't fight. It's as if all of the Argentine ant colonies on the entire planet have drawn up a mutual cooperation treaty. An individual ant is a member not just of a colony, but of a planet-wide super colony. This makes Argentine ants virtually impossible to eradicate without sterilizing the entire planet.

To battle an Argentine ant invasion it is not enough therefore to simply kill the ants that you see, because there's almost certainly an effectively infinite supply of them hidden away at the other end of their trail. The only effective defense against them is to infiltrate the colony with poison-laced food, which takes several days to be effective. Happily, but ominously, in our case we were able to track the infestation back to its source, which turned out to be a potted fern in our dining room. It was happy because we were able to just take the fern outside and dispense with the multi-day poisoning operation. But it was ominous because we have no freakin' clue how that colony came to become established there in the first place. That fern has been sitting in our dining room on a three-leged metal stand for months and months. We water it regularly. Until last night we never saw even a single ant there.

Kinda creepy.

Newt Gingrich wants to fix poverty by making poor kids scrub toilets

I gotta give Newt Gingrich credit for one thing. He's certainly not afraid to stand up for a controversial position:

"Really poor children in really poor neighborhoods have no habits of working and nobody around them who works," Gingrich replied. "So they literally have no habit of showing up on Monday. They have no habit of staying all day. They have no habit of 'I do this and you give me cash,' unless it's illegal."


"I believe the kids could mop the floor and clean up the bathroom and get paid for it, and it would be OK," he said to applause.

Newt is actually right about this, but here's the thing: rich kids don't have habits of working either. I never worked when I was a kid. I've never been paid for mopping a floor or cleaning a bathroom. But I turned out OK. Why? Because I was fortunate enough to grow up where there were some really good public schools where I got a really good education. And then I went to a public college on a scholarship. And then I went to grad school on a fellowship grant from the Office of Naval Research. And then I went to work for NASA. Until I went to work for Google at age 37 every dollar that paid for my education and my salary came from the government.

So Newt, how about instead of making them scrub toilets we give the inner city kids the same high-quality publicly funded educational opportunities that I had as a white middle-class child of the 'burbs? I turned out OK. Maybe they will too.