Vested Interest - Tort Briefs - May 1999 Issue

Judge Halves Punitives in California Tobacco Case

A jury had issued a verdict of $51.5 million – including $50 million in punitives – to Patricia Henley, who smoked in part because she believed Philip Morris’ claims that tobacco was safe. But Judge John Munter ruled that the punitive portion of the verdict was excessive, and so halved the amount, claiming that a total verdict of $26.1 million would still cause “substantial discomfort” to the tobacco giant. Judge Munter also denied Philip Morris’ request for a new trial. (AP, April 7, 1999)

Oregon Jury Issues $81 Million Tobacco Verdict

Jesse Williams smoked three packs of Marlboros a day for 42 years, in part because he believed the tobacco companies’ assertions that there was no link between cigarettes and cancer. He died of lung cancer. His estate brought suit against Philip Morris, claiming that their product and their false information about their product contributed to his premature death. A Portland, Oregon, jury agreed, issuing a verdict worth $1.6 million in compensatories and $79.5 million in punitives. Observers expect the punitive component to be cut by the court, but also note that this case, coming so soon after a similar San Francisco verdict, suggests that the tide may be turning in tobacco cases. (AP, March 31, 1999)

U.S. Supreme Court Affirms Some Restrictions on ERISA Preemptions

The U.S. Supreme Court has ruled that the federal Employee Retirement Income Security Act (ERISA) does not limit state regulation of company insurance plans. John E. Ward left his job in 1992 due to a disability. The company failed to notify him that he had disability insurance as an employee benefit until 1994, whereupon he filed a claim with Unum Life Insurance. Unum sought to avoid paying the claim, alleging that Ward had failed to notify Unum in a timely manner, and then claimed that ERISA preempted Ward’s suit under California law. The unanimous Supreme Court ruling in Unum Life v Ward (97-1868) held that ERISA did not preempt Ward’s suit, and that ERISA does not override California law governing the timeliness of notification for claims. Justice Ruth Bader Ginsburg wrote for the Court that “by allowing a longer period to file than the minimum filing terms mandated by federal law, the (state) rule compliments rather than contradicts ERISA...” Ward’s claim was remanded to state court for trial. (AP, April 20 ,1999)

Insurer Liable for Denying Care: California Jury

David Goodrich suffered from a rare form of stomach cancer, and his physician recommended a treatment that could not be provided by Aetna U.S. Healthcare, his HMO. His physician brought his case to a review panel at Aetna U.S. Healthcare, which approved Goodrich’s treatment. But the insurer ignored its own panel of doctors and delayed approval for two-and-one-half years until Goodrich died in 1995. A jury in San Bernardino, California, found Aetna U.S. Healthcare liable for Goodrich’s death, and ordered payment of $4.5 million in compensatories and $116 million in punitives. (AP, March 29, 1999)

5th Circuit Court Allows HMO Suit Despite ERISA

A Texas woman sued her health plan in state court, claiming that interference prevented her doctor from diagnosing her son’s enlarged heart. The boy died as a result. The health plan, NYLCare, sought removal to federal court and dismissal under ERISA. The 5th Circuit, however, upheld the district court ruling denying NYLCare’s motion, finding that the patient’s suit in state court may proceed. Texas is the only state currently with a law expressly allowing malpractice suits against health plans. The 5th Circuit found that health care is an area traditionally regulated at the state level, and that the suit should be addressed at that level. (AP, April 10, 1999)

New York Court Allows Suit Against Doctor for Following HMO Guidelines

Glenn Nealy suffered heart problems and sought a referral to a cardiologist from his primary care provider, Dr. Ralph Yung. The cardiologist Dr. Yung referred Nealy to, as per his HMO guidelines, was unable to schedule an appointment for a month. During that time, Nealy, 37, suffered a fatal heart attack. His widow, Susan, has now brought an action against the HMO, and is also pursuing a suit against Dr. Yung, claiming negligence in sending Nealy to a specialist who could not treat him for so long, and refusing to refer him to Dr. Stephen Green, who had previously treated Nealy but was not part of Nealy’s new health plan. Chief Judge Judith Kaye of New York’s appellate court has ruled that Dr. Yung’s referral was in his capacity as a doctor, not as an administrator, and so Dr. Yung is susceptible to an action under New York’s malpractice laws. (Bloomberg, March 25, 1999)

National Law Journal Lists Top Defense Wins

Noting that “many of the most significant victories in civil trials were for the defense”last year, the National Law Journal has issued its ninth annual list of Top Defense Wins. Leading the list is WS v Texas Data Control, in which the defense avoided liability in a qui tam action. Others on the (unranked) list include RJR Nabisco’s victory in a Delaware tobacco suit, Dunn v RJR Nabisco; gun makers’ success in the New York case Halberstam v S.W.Daniel; an obstetrician’s win in the Georgia med mal case Criscillis v Williams; a psychologist’s win in the Texas med mal case Jones v Keraga; General Motors’ win in the Mississippi products case Maxey v GMC; and an obstetrician’s win in the New York med mal case Kaffka v DeGann. The list makes clear that juries are not biased toward plaintiffs, even when presented with a severely injured, sympathetic victim. (The article appears in the April 19, 1999 issue of the National Law Journal)

California Jury Issues $6.9 Million Verdict to Blind Baby

Madison Scott was born three months early, and her doctor diagnosed retinopathy of prematurity, a common condition. But her doctor, Dr. Robert Hillyard, failed to ensure a follow-up exam to check progress. Dr. Hillyard did not examine her eyes until 6 weeks after he should have, accordng to notes in her file. As a result, her blindness is now permanent. A jury has issued a verdict for $6.9 million, including $5 million in future wage loss and $540,000 for past and future pain and suffering. (AP, April 13, 1999)

Tammy Wynette’s Family Sues, Claiming Malpractice Killed Her

Country singer Tammy Wynette, famous for “Stand By Your Man”, "D-I-V-O-R-C-E”, and “Don’t Come Home A-drinkin’ with Lovin’ on Your Mind”, died at age 55 on April 6, 1998 in Tennessee. Her family has now filed a malpractice suit against a Pittsburgh, Pennsylvania, doctor, Wallis Marsh, claiming that he kept her addicted to narcotics and contributed to her death. Also named as a defendant was George Richley, her manager and husband at the time of her death. Wynette had been married to country singer George Jones, and her daughters by that marriage filed the malpractice claim. “It makes me angry that her life was taken away from her before it should have been,” said daughter Georgette Smith. (AP, April 5, 1999)

Supreme Court to Rule on Federal Court Cases Against States

A lawsuit filed by dozens of probation officers in Maine will determine the applicability of some federal laws to state employees, after the Supreme Court rules later this term. The state employees sued the State of Maine, claiming violations of the federal Fair Labor Standards Act, specifically the denial of time-and-a-half for working more than 40 hours in a week. Maine has responded that applying the federal law to the state violated the Eleventh Amendment to the Constitution, and the Maine high court ruled that the Amendment barred suits in federal court against states. The high court is increasingly viewed as leaning towards a states’ rights position. (AP, March 31, 1999)

Supreme Court to Consider Case Transfer Deadlines

An Illinois company was sued by a Canadian company in Alabama court for failing to uphold its end of a contract. The Illinois company was notified of the suit by fax on January 29 and by certified mail on February 12. On March 13, the Illinois company sought to have the suit transferred to federal court. Plaintiff Canadians objected that defendants had 30 days from service to request a transfer, and that the 30 days ran from January 29 when they were faxed about the suit. The U.S. Supreme Court, ruling 6-3 in Murphy Bros. V Michetti Pipe (97-1909) held that the clock starts ticking only after formal service through certified mail. (AP, April 5, 1999)

BRITISH COURT REDUCES VERDICT IN McLIBEL CASE

The longest civil trial in British history involved two animal rights activists accused of defaming McDonalds’ restaurants. The case ended in a verdict for the restaurant chain, and an order that defendants pay 60,000 pounds to the international food conglomerate. The English High Court has now reduced that verdict to 40,000 pounds, roughly $64,000. Defendants Helen Steel and David Morris are unemployed; McDonalds has little chance of collecting. (Reuters, March 31, 1999)

Radiation Suit Settlement Calls for $5 Million, Plus a Plaque

For many years, cancer patients at Cincinnati General Hospital (now University Hospital), were unwittingly subjected to radiation experiments funded by the U.S. Defense Department. U.S. District Judge Sandra Beckwith has approved a settlement that calls for payments of about $50,000 to each of 50 plaintiffs. As part of the settlement, the federal government has also agreed to apologize to plaintiffs, and the hospital has agreed to post a memorial plaque noting the government apology and the plaintiffs’ suffering. (AP, April 6, 1999)

Michelin Verdict Thrown Out Over Jury Bias

Julian Lovett received a $30 million verdict from a West Palm Beach jury as compensation for losing his legs above the knees when the left front tire on his fertilizer truck blew out, causing the 18-wheeler to swerve into a ditch. But defendant Michelin Tire Company successfully argued that the verdict should be thrown out, because a juror admitted that her daughter had experienced a similar accident when the Michelin tires on her car unexpectedly failed. Michelin sought to have the juror dismissed during jury selection, but the judge denied the request. (AP, April 1, 1999)

Jury Sides with News Anchor in Disability Case

Sara Lee Kessler started as a TV reporter at WWOR in New Jersey in 1976 and eventually was promoted to anchor of the “Noon News” program, where she won an Emmy for reporting on the 1993 World Trade Center Bombing. After suffering an injury, she was forced to take disability leave. As a result, the station demoted her, then fired her from her position. Her current job pays a sixth of her old salary. A Newark, New Jersey, jury found that the station’s actions were illegal, and issued a verdict for $7 million, including $2.8 million in lost wages. (AP, April 7, 1999)