Insurance and health law developments early autumn 2011, with fresh pressed cider and cinnamon

Abuse & Neglect: NEGLECT FINDING REQUIRES PROOF OF MENTAL STATE, DELAWARE SUPREME COURT FINDS, Dep't of Health & Social Servs. v. Jain, The Delaware Supreme Court has ruled in an issue of first impression that a psychiatric nurse cannot be put on the state's adult-abuse registry without proof that she knowingly or recklessly neglected a patient. The high court said a hearing officer at the Delaware Department of Health and Social Services improperly put Madhu Jain on the registry upon finding she acted negligently or carelessly.

Bad Faith: DAMAGE CAUSED BY METH LAB ISN'T COVERED, OKLAHOMA FEDERAL JUDGE SAYS, State Farm v. Groff, State Farm did not act in bad faith when it invoked a contamination exclusion and denied coverage for damage to a rental house caused by an on-premises methamphetamine lab, an Oklahoma federal judge has ruled. U.S. Magistrate Judge Steven P. Shreder of the Eastern District of Oklahoma said the policy specifically excluded coverage for contamination, which applied to damage to the dwelling caused by methamphetamine fumes.

Bad Faith: DELAYED SETTLEMENT NOT BAD FAITH; SEVERITY OF INJURY WAS UNKNOWN, Machalette v. Southern-Owners Ins., An insurance carrier did not act in bad faith when it failed to offer a settlement to a car crash victim until it received completed interrogatories that detailed the extent of his injuries, a Florida federal judge has ruled. Prior to viewing the discovery responses, the insurance carrier had no knowledge that the injuries were so severe that an excess judgment was likely, U.S. District Judge James S. Moody Jr. of the Middle District of Florida said.

Bad Faith: DENIAL OF COVERAGE FOR 'VALLEY FEVER' ISN'T BAD FAITH, Brown v. Farmers Group, An insurance carrier did not act in bad faith when it denied coverage based on policy exclusions to an insured who contracted "chronic valley fever" after being exposed to dust in her home, a California appeals court has ruled. The 1st District Court of Appeal determined that the insurance policy unambiguously excluded coverage for various causes of loss, including the fungi that caused the disease, which negated the bad-faith claim.

Electronic Payments: NATIONWIDE MUT. INS. DELAYED ONLINE PAYMENTS TO COLLECT LATE FEES, CLASS ACTION ALLEGES, Rega v. Nationwide Mut. Ins. Co., An automobile policyholder has filed a class-action lawsuit alleging Nationwide Mutual Insurance Co. unreasonably delayed processing premiums paid online so it could collect unwarranted late fees. Peter Rega, a Nationwide policyholder from 2009 to 2010, filed the class- action complaint in the U.S. District Court for the Northern District of Ohio on behalf of himself and others who vehicles the company insured.

Federal Insurance - Health - Federal Regulations

DEPARTMENT OF HEALTH AND HUMAN SERVICES Centers for Medicare and Medicaid 42 CFR Part 411 Exclusions From Medicare and Limitations on Medicare Payment Final Rule

76 FR 60378-01

Health Care: INSURER REIMBURSED $1,600 FOR $56,000 WEIGHT-LOSS SURGERY; 10TH CIRCUIT ASKS HOW, Weight Loss Healthcare Ctrs. of Am. v. Office of Pers. Mgmt., The Office of Personnel Management needs to know the underlying data an insurer used to calculate its $1,610 reimbursement to an out-of-network provider for a government employee's $56,000 outpatient weight-loss surgery, a federal appeals court has ruled. The 10th U.S. Circuit Court of Appeals rejected the provider's argument that OPM incorrectly interpreted the employee's health plan with Blue Cross Blue Shield of Kansas.

 Insurance Coverage--Intellectual Property: NO COVERAGE FOR QUILTER'S $600,000 VOLUNTARY IP SETTLEMENT, Sunham Home Fashions v. Diamond State Ins. Co., 21 No. 51 Westlaw Journal Insurance Coverage 5, Westlaw Journal Insurance Coverage September 30, 2011

Two insurers had no duty to reimburse their policyholder when it voluntarily settled an intellectual property dispute without their consent, a New York federal judge has ruled. U.S. District Judge Denise Cote of the Southern District of New York disregarded Sunham Home Fashions' argument that Diamond State Insurance Co.'s excess policy covered the underlying lawsuit's copyright allegations as an advertising injury.

Lap-Band: LAP-BAND SURGERY MARKETERS SUED OVER CALIFORNIA WOMAN'S DEATH, Brown v. 1-800-GET-THIN, Relatives of a California woman who died three days after undergoing Lap-Band weight loss surgery have sued the advertising company they say enticed the woman with false and misleading representations to undergo the procedure.

Legislation: SENATE BILL CALLS FOR VERBAL PRESCRIPTIONS AT NURSING HOMES, U.S. Sen. Herb Kohl has introduced legislation that would permit physicians to verbally issue prescriptions for controlled substances to nursing home residents in an effort to reduce wait time for pain-relieving medications.

Maritime Law - Ship was not unseaworthy based on allegation that ship's doctor was negligent in diagnosing and treating ectopic pregnancy. A cruise ship was not unseaworthy based on an allegation that the ship's doctor was negligent in diagnosing and treating a ship photographer's ectopic pregnancy. While the affidavit submitted on the motion for summary judgment indicated that the doctor failed to follow standard diagnostic procedure, the affidavit did not challenge the doctor's qualifications. An isolated, negligent act performed by an otherwise competent crew member was not a condition of the vessel and did not render the ship unseaworthy. Flueras v. Royal Caribbean Cruises, Ltd. ,(Fla.App. 3 Dist.)  (This decision may not yet be released for publication.)

Medicare: CMS SEES PRIVATE MEDICARE PLANS GROWING IN 2012, WASHINGTON, Sept. 15 (Reuters) - More elderly and disabled Americans will enroll in private Medicare health insurance plans next year, and they will pay lower premiums for the second year in a row, U.S. health officials said. The plans, called Medicare Advantage, are run through private health insurers as an alternative to traditional fee-for-service Medicare plans.

Medicare Billing Fraud: DRUG SUPPLIER CAN'T BE LIABLE FOR KEEPING OVERPAYMENTS, COURT RULES, United States v. Omnicare, An Illinois federal judge has dismissed claims that a national pharmacy supplier unlawfully kept Medicare overpayments, finding that amendments to the False Claims Act adding "retention of an overpayment" as a basis for liability cannot be applied retroactively. U.S. District Judge James B. Zagel of the Northern District of Illinois also rejected the auditor whistle-blower's alternative argument that his allegations were sufficient to plead a violation of the pre-amendment FCA.

Natural Disasters: BROKER WORKS AS AGENT OF INSURED, NOT INSURER, 11TH CIRCUIT RULES, Landmark Am. Ins. Co. v. Moulton Props., Insurers may not have to pay for hurricane damage if the independent broker who solicited policy bids on the property owner's behalf misrepresented the extent of damage an earlier hurricane had caused to the property, a federal appeals court has ruled. The 11th U.S. Circuit Court of Appeals agreed with Landmark American Insurance Co. and Arch Specialty Insurance Co. that Peachtree Special Risk Brokers acted as an agent of Moulton Properties when it procured property coverage for the company.

Premises Liability: NURSING HOME MUST DEFEND AGAINST SLIP-AND-FALL SUIT, Christmas v. Kindred Nursing Ctrs., An Indiana appeals court has revived a home detention officer's lawsuit alleging he slipped and fell on a patch of ice outside a nursing while making an unannounced visit to a detainee employed there. The Court of Appeals held that genuine issues of material fact remain as to whether Isaiah Christmas was an invitee of the Windsor Estates Health & Rehabilitation Center at the time of his injury and whether the facility breached its duty of care.

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Health law, arugula with roasted tomatoes and garlic over penne pasta

Medicaid Services: SUPREME COURT TO DECIDE IF CALIFORNIA CAN CUT MEDICAID PAYMENTS, Maxwell-Jolly v. Pharmacists Ass'n, 13 No. 15 Westlaw Journal Nursing Home 1, Westlaw Journal Nursing Home January 28, 2011

The U.S. Supreme Court has agreed to review a California health official's claims that the state should be allowed to reduce Medicaid payments to physicians, hospitals and pharmacies because of its current budget crisis. The high court granted the state's petition for review of a 9th U.S. Circuit Court of Appeals ruling that a state-approved reduction in Medicaid payments is preempted by federal Medicaid law.

Abuse & Neglect: FLORIDA SUIT SAYS HOME FAILED TO PREVENT RESIDENT'S FALLS, Cook v. Senior Care Cedar Hills, 13 No. 15 Westlaw Journal Nursing Home 2, Westlaw Journal Nursing Home January 28, 2011

An elderly dementia sufferer in Florida suffered numerous falls, infections and insect infestations during her stay at a Jacksonville nursing home, her daughter alleges in a state court lawsuit. Martha Y. Cook claims that Cedar Hills Healthcare Center violated her mother's rights as a nursing home resident when it failed to monitor her, prevent falls, and protect her from infestations of scabies mites and bed bugs.  

Billing Fraud: VIRGINIA FEDERAL JUDGE WON'T DISMISS MEDICARE FRAUD DEFENDANTS, United States v. Americare In Home Nursing, 13 No. 15 Westlaw Journal Nursing Home 3, Westlaw Journal Nursing Home January 28, 2011

A Virginia federal judge has denied a motion by Visiting Nurse Service Network and its executive director to dismiss a suit alleging the company violated the federal Anti-Kickback Statute and False Claims Act by running an illegal patient referral scheme. U.S. District Judge James C. Cacheris of the Eastern District of Virginia also denied a motion to dismiss by a defendant home health care company allegedly involved in the scheme but granted dismissals to a third company and a home health firm.

Billing Fraud: WHISTLE-BLOWER SUIT AGAINST KANSAS HOSPICE PROVIDER SURVIVES, United States v. Hospice Care of Kansas, 13 No. 15 Westlaw Journal Nursing Home 4, Westlaw Journal Nursing Home January 28, 2011

A Kansas federal judge has declined to dismiss a whistle-blower lawsuit alleging Hospice Care of Kansas and parent Voyager Hospicecare instructed staff members to unlawfully document patients' conditions to make them appear eligible to receive Medicare benefits. Judge Carlos Murguia of the U.S. District Court for the District of Kansas rejected the defendant companies' argument that plaintiff Beverly Landis failed to plead her fraud claims with the particularity required by Federal Rule of Civil Procedure.

Coercion: LOUISIANA APPEALS PANEL REJECTS DECEASED MOTHER'S COERCION CLAIMS, Petrie v. Michetti, 13 No. 15 Westlaw Journal Nursing Home 5, Westlaw Journal Nursing Home January 28, 2011

A Louisiana appeals court has rejected the claims of a now-deceased dementia sufferer who said her daughter coerced her into donating property by threatening to put her in a nursing home. Maxine Rearick failed to present clear and convincing evidence that she donated property to her daughter under threat of harm and without real volition, the Court of Appeal's 5th Circuit found.The three-judge panel upheld a trial court's denial of Rearick's request to nullify or revoke the donation.

Employment: SUNRISE FACILITY FIRED WORKER FOR REPORTING NEGLECT, SUIT SAYS, Tobritzhofer v. Sunrise Senior Living, 13 No. 15 Westlaw Journal Nursing Home 6, Westlaw Journal Nursing Home January 28, 2011

Management at a Sunrise Senior Living facility in Minnesota fired a staff member for reporting increased incidents of resident neglect and declining levels of care, a federal lawsuit alleges. Kimberly Tobritzhofer claims that her superiors at Sunrise of Roseville repeatedly told her not to report residents' increased occurrences of falling and concerns about skin care to state health officials or other employees. In a complaint for wrongful discharge filed in the U.S. District Court.

Financial Elder Abuse: CALIFORNIA APPEALS COURT FINDS DISABLED WOMAN'S FAMILY VIOLATED TRUST, McQueen v. Drumgoole, 13 No. 15 Westlaw Journal Nursing Home 7, Westlaw Journal Nursing Home January 28, 2011

A California appeals court has upheld a jury's finding that a mentally retarded woman's uncle, sister and attorney violated a trust by selling the family residence without her knowledge and cutting her out of the proceeds. The trial judge properly allowed jurors to consider Ida McQueen's conversion claim and issued correct jury instructions on the standard for financial elder abuse, the 1st District Court of Appeal said.McQueen, 76, suffers from mild mental retardation and is wheelchair-bound.

Health Care Reform: CHRISTIAN GROUP CHALLENGES HEALTH CARE REFORM BILL IN 6TH CIRCUIT, Thomas More Law Ctr. v. Obama, 13 No. 15 Westlaw Journal Nursing Home 8, Westlaw Journal Nursing Home January 28, 2011

A Christian legal advocacy group seeking to derail President Obama's health care reform law has taken its case to the 6th U.S. Circuit Court of Appeals. The Thomas More Law Center is challenging U.S. District Judge George Caram Steeh's ruling that the government legally can require uninsured people to purchase coverage.The judge had denied the group's request for an injunction against a provision in the Patient Protection and Affordable Care Act, Pub. L. No. 111-148, that imposes a penalty.

Legislation: WISCONSIN SENATE PASSES LAWSUIT REFORM, PUNITIVE DAMAGES CAP, 13 No. 15 Westlaw Journal Nursing Home 9, Westlaw Journal Nursing Home January 28, 2011

The Wisconsin Senate has approved legislation that imposes greater restrictions on evidence in tort cases against long-term-care facilities and caps punitive damages in all cases at $200,000. The Republican-authored law is part of a five-bill package introduced by incoming Gov. Scott Walker to promote a "business- and job-friendly legal environment," he told the media Jan. 4. However, state Democrats and advocacy groups for the elderly claim the package's lawsuit reform bill shields nursing homes.

Long-Term-Care Insurance: DEMENTIA SUFFERERS SEEK PENALTIES AGAINST LTC INSURER, Barton v. Bankers Life & Cas. Co., 13 No. 15 Westlaw Journal Nursing Home 10, Westlaw Journal Nursing Home January 28, 2011

A Texas couple, both diagnosed with dementia, have sued their long-term-care insurer over its allegedly wrongful denial of their claims and refusal to comply with requests for policy information. Glen and Barbara Barton claim that Bankers Life & Casualty Co. has declined to reimburse them $7,500 in legal expenses despite the insurer's concession that it should have approved their claims for benefits in 2009 and 2010. They seek reimbursement plus thousands in statutory penalties for the insurer.

Medicaid Services: CUTS IN MEDICAID HOME SERVICES WILL HURT THOUSANDS, LOUISIANA RESIDENTS SAY, Pitts v. Greenstein, 13 No. 15 Westlaw Journal Nursing Home 11, Westlaw Journal Nursing Home January 28, 2011

Four low-income Louisiana residents are seeking class-action status in their bid to stop the state from cutting home-care Medicaid services for nearly 11,000 poor people. Plaintiffs Helen Pitts, 78, Kenneth Roman, 47, Denise Hodges, 53, and Ricki Ainey 30, allege the Louisiana Department of Health and Hospitals plans to slash its program offering long-term, personal care services in the face of a $1.6 million budget deficit. The move is discriminatory because it will result in thousands of Medicaid cuts.

Implantable Defibrillators: 2ND TIME AROUND, GUIDANT GETS OK ON $296 MILLION PLEA DEAL, United States v. Guidant LLC, 17 No. 25 Westlaw Journal Medical Devices 1, Westlaw Journal Medical Devices January 31, 2011

A federal judge in Minneapolis has approved a $296 million plea agreement between Guidant LLC and the Justice Department, noting that the pact places the company on probation, an element absent in a previously rejected proposal. Last April U.S. District Judge Donovan W. Frank of the District of Minnesota rejected a virtually identical plea deal over the company's concealment of defects in some of its implantable heart defibrillators, saying it lacked a probation element.

Hydro ThermAblator (Federal Preemption): 5TH CIRCUIT RESTORES PART OF BURN VICTIM'S SUIT AGAINST BOSTON SCIENTIFIC, Hughes v. Boston Scientific Corp., 17 No. 25 Westlaw Journal Medical Devices 2, Westlaw Journal Medical Devices January 31, 2011

A federal appeals court has restored a failure-to-warn claim by a woman who says she was severely burned by a device used to stop uterine bleeding, reversing a judge's finding that the action is federally preempted. Jan Hughes can proceed with her claim that Boston Scientific Corp. failed to properly warn her about the Hydro ThermAblator's burn risks, the 5th U.S. Circuit Court of Appeals said, because she based her allegation on the firm's alleged failure to comply with federal regulations.

Prosthetic Hip: LIMITATIONS STATUTE SNUFFS SUIT OVER FLORIDA WOMAN'S FAILED PROSTHESIS, Chapman v. DePuy Orthopaedics, 17 No. 25 Westlaw Journal Medical Devices 3, Westlaw Journal Medical Devices January 31, 2011

Citing an expired statute of limitations, a federal judge in Tampa, Fla., has granted summary judgment for DePuy Orthopaedics in a suit alleging a woman's hip prosthesis failed because it was negligently designed and manufactured. U.S. District Judge Virginia Covington of the Middle District of Florida found that although the plaintiff lives in the state, her suit is governed by Virginia's two-year limitations period for product liability cases because that is where the disputed device was purchased.

Prosthetic Hip (Discovery): ILLINOIS FEDERAL JUDGE KILLS HIP PLAINTIFF'S 'OVERLY BROAD' DISCOVERY REQUEST, Pankey v. Wright Med. Group, 17 No. 25 Westlaw Journal Medical Devices 4, Westlaw Journal Medical Devices January 31, 2011

A federal judge in Urbana, Ill., has denied as "overly broad" a plaintiff's discovery motion in a suit alleging the premature failure of a hip prosthesis system from Wright Medical Group. Rejecting plaintiff Glenn D. Pankey's motion to compel discovery, U.S. Magistrate Judge David G. Bernthal of the Central District of Illinois sided with the medical device maker. Wright had argued that the request for extensive data on all Profemur hip prosthesis products constituted an unauthorized "fishing expedition.”

Surgical Tool: CALIFORNIA APPEALS COURT BACKS DISMISSAL OF SURGICAL TOOL INJURY SUIT, Courtenay v. U.S. Surgical Corp., 17 No. 25 Westlaw Journal Medical Devices 5, Westlaw Journal Medical Devices January 31, 2011

A California appeals court has affirmed dismissal of a failure-to-warn suit against the maker of a gynecological surgical tool by a woman who says she was injured during a procedure to implant a supportive mesh device. Elisabeth Courtenay turned to the 2nd District Court of Appeal after a trial judge granted summary judgment to Tyco Healthcare Group and U.S. Surgical Corp.Her claims related to the use of the IVS Tunneller during a 2004 abdominal operation.  

Pain Pump: BREG SCORES WINS OHIO PAIN PUMP SUIT, Krumpelbeck v. Breg Inc., 17 No. 25 Westlaw Journal Medical Devices 6, Westlaw Journal Medical Devices January 31, 2011

Breg Inc. had no reason to warn an Ohio woman of possible cartilage damage from the use of one of its pain pumps to inject anesthetics into her shoulder after a 2005 operation, a federal judge in Cincinnati has ruled. U.S. District Judge Timothy S. Black of the Southern District of Ohio granted the company's motion for summary judgment, finding no duty to warn at the time the injection took place in March 2005.

Pain Pump: NEGLIGENCE, LIABILITY CLAIMS GO FORWARD IN SOUTH DAKOTA PAIN-PUMP SUIT, Suhn v. Breg Inc., 17 No. 25 Westlaw Journal Medical Devices 7, Westlaw Journal Medical Devices January 31, 2011

A federal judge in Sioux Falls, S.D., will allow negligence and strict liability claims to proceed in a man's lawsuit alleging his shoulder cartilage was destroyed when a Breg Inc. pain pump was used to infuse anesthesia directly into the joint. U.S. District Judge Karen E. Schreier of the District of South Dakota said Marcus Suhn provided enough data for a jury to find the defendant should have known that injecting medication directly into the shoulder joint might cause irreparable cartilage damage.

Panacryl Sutures: MDL JUDGE SENDS SUTURE SUIT BACK TO MISSOURI STATE COURT, Englemen v. Johnson & Johnson, 17 No. 25 Westlaw Journal Medical Devices 8, Westlaw Journal Medical Devices January 31, 2011

The North Carolina federal judge presiding over the consolidated suits on Johnson & Johnson's failed Panacryl sutures has returned an infection case to Missouri state court, rejecting J&J's claim that a Missouri medical products supplier was fraudulently joined to defeat federal court jurisdiction. U.S. District Judge Terrence W. Boyle of the Eastern District of North Carolina rejected defense arguments that remand should be denied.

Pain Patch: DESIGN, MANUFACTURING DEFECT CLAIMS STAND IN OHIO PAIN-PATCH DEATH SUIT, Miller v. Alza Corp., 17 No. 25 Westlaw Journal Medical Devices 9, Westlaw Journal Medical Devices January 31, 2011

Alza Corp. must face design and manufacturing defect allegations by the survivors of an Ohio man who died when a pain patch he was wearing allegedly leaked a fatal overdose of fentanyl. U.S. District Judge Timothy S. Black of the Southern District of Ohio denied Alza's motion to dismiss the claims, holding that circumstantial evidence surrounding Cornell Phillips' 2006 death created a genuine issue of fact on whether the Alza patch Phillips was using when he died had a leak. 

Lasik Surgery: WOMAN NEEDS CORNEA TRANSPLANT AFTER FAILED LASER SURGERIES, SUIT SAYS, Linegar v. Lobanoff, 17 No. 25 Westlaw Journal Medical Devices 11, Westlaw Journal Medical Devices January 31, 2011

Three failed laser eye surgery procedures in less than one year have left a woman with an irreversibly scarred cornea, according to a lawsuit filed in Minnesota federal court. Layla Linegar says she now needs a cornea transplant in her left eye. Ophthalmologist Mark Lobanoff assured Linegar she was a suitable candidate for Lasik surgery after examining her in December 2008, according to the complaint filed in the U.S. District Court for the District of Minnesota.

 17 No. 25 Westlaw Journal Medical Devices 12, Westlaw Journal Medical Devices January 31, 2011

FDA panel weighs tougher rules for defibrillators The Food and Drug Administration is considering enacting tougher restrictions to force the makers of automatic external defibrillators to submit added data before offering the devices for sale. The FDA, which notes that 300,000 Americans collapse from sudden cardiac arrests annually, says that since 2006, AED makers have issued 68 product recalls, affecting hundreds of thousands devices. The agency says regulatory review is needed.

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Fraud, false claims act, arbitration, nursing homes, medical negligence and tossed oriental vegetables with garlic croutons

OBAMA ADMINISTRATION LAUNCHES 'COMMUNITY LIVING' INITIATIVES, 12 No. 1 Andrews Nursing Home Litig. Rep. 3, Andrews Nursing Home Litigation Reporter July 2, 2009
The Obama administration has proclaimed this the "year of community living" by launching initiatives to help disabled Americans find home- and community- based alternatives to institutionalization in nursing homes. The announcement came on the 10th anniversary of the U.S. Supreme Court's landmark decision in Olmstead v. L.C., 527 U.S. 581 (1999), which held that the unnecessary institutional segregation of disabled people constitutes discrimination under the Americans with Disabilities Act

UNSEALED SUIT TOSSED IN FALSE CLAIMS ACT CASE, United States v. LHC Group, 12 No. 1 Andrews Nursing Home Litig. Rep. 8, Andrews Nursing Home Litigation Reporter July 2, 2009 A federal judge in Tennessee has dismissed with prejudice a whistle-blower suit against a home health care business because the plaintiff's attorney failed to file the complaint under seal as required by the False Claims Act. U.S. District Judge Thomas A. Wiseman Jr. said his decision to toss the case was supported by the plain language of the FCA, 31 U.S.C. 3729, and by case law, including United States ex rel. Erickson v. American Institute of Biological Sciences, 716 F. Supp. 908, 910

UNAVAILABLE FORUM VOIDS ARBITRATION PACT, Grant v. Magnolia Manor-Greenwood, 12 No. 1 Andrews Nursing Home Litig. Rep. 6, Andrews Nursing Home Litigation Reporter July 2, 2009 An arbitration agreement between a nursing home and a resident is not enforceable because the organization designated to handle the proceedings no longer accepts such cases, the South Carolina Supreme Court has ruled. The high court unanimously ruled that the American Health Lawyers Association as the arbitration forum was an "integral part" of the agreement.The ruling means James O. Grant may continue to litigate his wrongful-death lawsuit

NURSING HOME MORTGAGOR CHEATED HUD ON LOANS; SUIT SEEKS $77 MILLION, United States v. Capmark Fin., 12 No. 1 Andrews Nursing Home Litig. Rep. 9, Andrews Nursing Home Litigation Reporter July 2, 2009 A mortgage banking company allegedly lied to the U.S. Department of Housing and Urban Development on loan insurance applications for two nursing home customers, causing the government to lose nearly $26 million when the homes defaulted. The government is seeking $77 million in treble damages from Capmark Finance Inc. under the False Claims Act, 31 U.S.C. 3729. The company was one of the nation's largest originators of HUD-insured loans, according to the complaint.

PARENTS WIN FIRST VERDICT AGAINST DUPONT IN PEDIATRIC HEART SURGERY CASES, Svindland v. Nemours Found., 5 No. 3 West's Medical Malpractice Law Report 1, West's Medical Malpractice Law Report July 2, 2009 A federal jury in Philadelphia has returned a $650,000 verdict for parents who say a cardiac surgeon at A.I. duPont Hospital for Children committed malpractice when he performed experimental surgery on their infant son, causing his death. The verdict was the first in favor of any plaintiffs in some 20 cases filed against the Delaware hospital and former chief cardiac surgeon William I. Norwood since 2004. Ten of the cases remain pending.

VERMONT TIGHTENS RULES ON GIFTS FROM DEVICE, DRUG COMPANIES, 5 No. 3 West's Medical Malpractice Law Report 3, West's Medical Malpractice Law Report July 2, 2009
Vermont Gov. Jim Douglas has signed into law a bill that will tighten state regulations involving gifts to health care providers by makers of "prescribed products" like drugs and medical devices. The state Legislature approved the measure, S. 48, with strong bipartisan support, by a 99-40 House vote and a 137-4 tally in the Senate. It took effect July 1. The new law removes loopholes in the state's current physician gift reporting system.

MOM ADDS ER NURSE, ILLINOIS HOSPITAL TO CIVIL RIGHTS SUIT, Lopez v. Village of Carpentersville, 5 No. 3 West's Medical Malpractice Law Report 4, West's Medical Malpractice Law Report July 2, 2009
An Illinois hospital and a registered nurse have been added as defendants in a federal lawsuit alleging paramedics refused to take a baby to the emergency room because he is Hispanic. The delay in care left the boy with permanent brain damage, plaintiff Gloria Lopez says. Lopez amended her complaint in the U.S. District Court for the Northern District of Illinois to name Sherman Hospital and ER nurse Jenny Lentz.

NURSES CAN GIVE EXPERT MEDICAL OPINIONS, PA. HIGH COURT SAYS, Freed v. Geisinger Med. Ctr., 5 No. 3 West's Medical Malpractice Law Report 5, West's Medical Malpractice Law Report July 2, 2009
Noting it is "loath to reverse our own prior decisions," the Pennsylvania Supreme Court has done just that after finding an earlier ruling that precluded nurses from offering medical opinions when testifying as experts conflicted with the state's "liberal standards" for expert testimony. The June 15 decision means that a paralyzed man can have his day in court in a lawsuit alleging inadequate nursing care led to his bedsores.

COURT UPHOLDS JUDGMENT ON 'REASONABLE' MEDICAL CHARGES, Strawn v. Farmers Ins. Co., 5 No. 3 West's Medical Malpractice Law Report 7, West's Medical Malpractice Law Report July 2, 2009
An Oregon appeals court has upheld a multimillion-dollar jury award in a class action over personal injury protection payouts, finding that the insurance companies' method of determining "reasonable" medical charges breached the policies. According to the opinion, Mark Strawn filed the underlying class-action lawsuit against Farmers Insurance Co. of Oregon, Mid-Century Insurance Co. and Truck Insurance Exchange.Strawn alleged the insurers used cost-containment software to determine "reasonable" medical charges.

Fees incurred in non-binding arbitration -- Party is not required to plead entitlement to attorney's fees incurred during court-ordered, nonbinding arbitration conducted pursuant to section 44.103 because it is only after case has been terminated that a party can determine whether fee-shifting provision of statute has become effective and, if so, file an appropriate motion seeking entitlement to fees -- Even if law had required defendants to plead claim for attorney's fees pursuant to section 44.103, plaintiff waived that argument by not objecting, either before or after entry of final judgment, although defendants sent plaintiff a proposed final judgment stating that trial court would reserve jurisdiction to consider defendants' motion to tax fees and costs pursuant to section 44.103, filed a motion for entitlement to attorney's fees based upon plaintiff's rejection of arbitrator's decision, and sent plaintiff a proposed order granting the motion
Reported at 34 Fla. L. Weekly D1344a

Hospital consent form indicating that surgeons were independent contractors did not, standing alone, conclusively refute apparent agency relationship between hospital and surgeons -- Further, trial court erred in failing to require hospital to properly lay predicate for business records exception to hearsay before admitting consent form into evidence -- Remand to provide hospital with opportunity to attach affidavit laying proper predicate for business records exception -- Parties may submit additional record evidence in support of or in opposition to summary judgment under apparent agency theory, and thereafter, trial court may reevaluate whether genuine issues of material fact exist on this issue
Reported at 34 Fla. L. Weekly D1349a

ACE, AIG FACE SUIT FOR REFUSING TO COVER FULL SETTLEMENT COSTS, Experian Info. Solutions v. Ill. Union Ins. Co., 19 No. 39 Andrews Ins. Coverage Litig. Rep. 6, Andrews Insurance Coverage Litigation Reporter July 2, 2009 A credit reporting agency has sued its insurers for refusing to cover costs and attorney fees incurred in connection with the settlement of two class- action lawsuits against it. Experian Information Solutions, which specializes in consumer and business credit reporting and marketing services, says ACE and American International Group are in breach of contract by refusing to pay for any settlement that includes an attorney fee award and related costs.

Subprime: AIG CAN'T MAKE CO-CONSPIRATORS HELP PAY FOR FRAUD, AIG Consol. Derivative Litig., 19 No. 39 Andrews Ins. Coverage Litig. Rep. 8, Andrews Insurance Coverage Litigation Reporter July 2, 2009
Troubled insurance titan AIG cannot sue brokers and reinsurers that allegedly helped it defraud investors of $5 billion with bid-rigging, phantom deals and fake reinsurance schemes, a Delaware state court judge has ruled. Vice Chancellor Leo Strine said the in pari delicto doctrine bars AIG and its former officers and directors from trying to force insurance broker Marsh & McLennan Cos. and other alleged co-conspirators to help pay for any future judgment or settlement that shareholder plaintiffs.

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Some interesting health law decisions that blend the statutory with the common law

Nursing homes -- Settlement -- Equitable subrogation -- Hospitals -- Action by nursing home against hospital seeking to recover amounts paid in settlement of former patient's claims, which were based on sacral wound which patient had when she was discharged from nursing home and for which patient subsequently received hospital treatment on three different occasions, alleging that hospital's negligent treatment of patient was primary cause of patient's damages -- Limitation of actions -- Limitations period for equitable subrogation action did not begin to run until nursing home made payment to patient -- Nursing home's pleadings adequately described reason it made payment to patient -- Sovereign immunity -- Notice of claim -- Nursing home's failure to present claim in writing to Department of Financial Services within three years after claim arose not basis for granting summary judgment in favor of hospital and dismissing case with prejudice where at time of dismissal the applicable limitations periods had not yet expired -- Remand for entry of final judgment dismissing cause without prejudice for failure to comply with section 768.28(6)(a)
Reported at 34 Fla. L. Weekly D723a

Nursing homes -- Arbitration -- Error to compel arbitration of claims brought on behalf of nursing home resident who died from neck injury she received at the facility where plaintiff argued that arbitration provision in nursing home admission agreement was unconscionable because decedent had no choice but to sign agreement in order to obtain necessary medical care and treatment and because decedent did not understand agreement or the rights she was waiving by signing the agreement -- Where plaintiff's written response in opposition to motion to compel and arguments at non-evidentiary hearing on motion raised disputed issues of fact as to the “making of” the arbitration agreement, trial court was required by statute to conduct evidentiary hearing to resolve disputed issues before sending case to arbitration
Reported at 34 Fla. L. Weekly D719a

Nursing homes -- Complaint seeking both survival and wrongful death damages -- Election of remedy -- Trial court order dismissing complaint and granting plaintiff twenty days to file amended complaint in which she elects remedy of either survival damages or wrongful death damages -- Certiorari relief is not available because plaintiff cannot demonstrate that she will be irreparably harmed by electing her remedy at pleading stage -- Any error in trial court's ruling can be corrected in postjudgment appeal
Reported at 34 Fla. L. Weekly D724a

Contrast Dye (False Advertising): GE HEALTHCARE ORDERED TO PAY $11.4 MILLION OVER FALSE AD CLAIM, Bracco Diagnostics v. Amersham Health, 25 No. 3 Andrews Pharmaceutical Litig. Rep. 1, Andrews Pharmaceutical Litigation Reporter April 20, 2009
A New Jersey federal judge has ordered GE Healthcare to pay $11.4 million in damages to rival Bracco Diagnostics for knocking the company's X-ray contrast dye in an ad campaign. During the 2007 trial in the U.S. District Court for the District of New Jersey, Bracco argued that GE and predecessors Amersham Health Inc., Amersham Health AS and Amersham PC violated the federal trademark law by making false and misleading advertising claims.

BRISTOL-MYERS SETTLES PLAVIX COVER-UP CLAIMS FOR $2.1 MILLION, FTC v. Bristol-Myers Squibb Co., 25 No. 3 Andrews Pharmaceutical Litig. Rep. 2, Andrews Pharmaceutical Litigation Reporter April 20, 2009
Bristol-Myers Squibb Co. will pay $2.1 million in civil penalties to settle charges that it lied to federal regulators about a silent agreement not to compete with Apotex Inc. once the generics maker unveiled its own version of the popular blood thinner Plavix. The settlement, approved in a unanimous vote of the Federal Trade Commission's four members, was filed with the U.S. District Court for the District of Columbia March 26.
Briefs and Other Related Documents: 2009 WL 964937, 2009 WL 964935, 2009 WL 964932

FIFTH CIR. AFFIRMS LILLY WIN IN TEXAS ZYPREXA SUICIDE LAWSUIT, Ebel v. Eli Lilly & Co., 25 No. 3 Andrews Pharmaceutical Litig. Rep. 3, Andrews Pharmaceutical Litigation Reporter April 20, 2009
A federal appeals court has upheld a ruling for Eli Lilly & Co. in a failure- to-warn suit alleging a Texas man's use of the antidepressant Zyprexa led him to commit suicide. The 5th U.S. Circuit Court of Appeals unanimously affirmed a federal judge's decision granting Lilly's motion for summary judgment under the "learned intermediary" doctrine.The judge had said Philip Ebel's physician knew of Zyprexa's possible side effects.

FEDERAL JUDGE EXPANDS COVERAGE FOR PLAN B, Tummino v. Torti, 25 No. 3 Andrews Pharmaceutical Litig. Rep. 4, Andrews Pharmaceutical Litigation Reporter April 20, 2009
A federal judge in Brooklyn has ordered the Food and Drug Administration to allow sales of Plan B emergency contraception to women under the age of 17 without a prescription. U.S. District Judge Edward R. Korman of the Eastern District of New York criticized current and former FDA officials for using "political considerations, delays and implausible justifications" to hold up the over-the- counter sale of the birth control drug.

CLASS SUIT OVER VIOXX CONSUMER COSTS IS REJECTED IN N.J., In re Vioxx Litig., 25 No. 3 Andrews Pharmaceutical Litig. Rep. 5, Andrews Pharmaceutical Litigation Reporter April 20, 2009
Merck & Co. has won dismissal of a New Jersey state court lawsuit that sought recovery of out-of-pocket expenses consumers paid for the recalled pain drug Vioxx. The proposed class-action lawsuit was filed by two former Vioxx users seeking to represent consumers who used the drug from June 1999 until its October 2004 recall because of its link to strokes and heart attacks.

MO. CLASS SUIT CLAIMS ILLEGAL PROMOTION OF ANTIDEPRESSANTS, Universal Care v. Forest Pharms., 25 No. 3 Andrews Pharmaceutical Litig. Rep. 6, Andrews Pharmaceutical Litigation Reporter April 20, 2009
A federal class action filed in St. Louis federal court seeks to have Forest Pharmaceuticals cough up profits it garnered through the allegedly illegal promotion of its antidepressants Celexa and Lexapro for use by teens and children. The suit is spearheaded by California-based health insurer Universal Care Inc., which says it covered the cost of the mood drugs provided to insured children, and by two plaintiffs who say they paid at least part of the costs.
Briefs and Other Related Documents: 2009 WL 964938

OHIO FED. COURT WON'T REVISIT SUIT OVER DIET-DRUG DEATH, Longs v. Wyeth, 25 No. 3 Andrews Pharmaceutical Litig. Rep. 7, Andrews Pharmaceutical Litigation Reporter April 20, 2009
A federal judge in Cleveland has refused to vacate or revise an order granting summary judgment to Wyeth in a lawsuit alleging the diet drug Redux caused an Ohio woman's death. U.S. District Judge Solomon Oliver Jr. of the Northern District of Ohio dismissed the suit against the drugmaker in February 2008.

ATTORNEYS WIN $1.4 MILLION IN FEES IN VACCINE TEST CASES, Cedillo v. Sec'y of Health & Human Servs., 25 No. 3 Andrews Pharmaceutical Litig. Rep. 8, Andrews Pharmaceutical Litigation Reporter April 20, 2009
Even though their clients lost, three law firms that filed claims alleging that mercury in vaccines causes autism will receive more than $1.4 million in interim fees for their efforts, the U.S. Court of Federal Claims has ruled. Special Master George Hastings Jr. said the three firms deserved the award because dozens of employees worked for several years on the highly complex cases, involving tens of thousands of pages of evidence and the testimony of 28 expert witnesses.

CVS TO PAY $2.25M TO SETTLE PRIVACY CASE, In re CVS Caremark Corp., 25 No. 3 Andrews Pharmaceutical Litig. Rep. 9, Andrews Pharmaceutical Litigation Reporter April 20, 2009
CVS Caremark has agreed to pay $2.25 million to settle charges that it violated federal privacy regulations when pharmacy employees threw out prescription records and drug bottles into open trash bins. The settlement resolves a joint investigation by the U.S. Department of Health and Human Services and the Federal Trade Commission prompted by 2006 media reports that Dumpsters behind certain CVS pharmacies contained pill bottles with patients' names, Social Security numbers and insurance information.

DRUG ERROR KILLED WOMAN IN OHIO NURSING HOME, SUIT SAYS, Freudeman v. The Landing of Canton, 25 No. 3 Andrews Pharmaceutical Litig. Rep. 10, Andrews Pharmaceutical Litigation Reporter April 20, 2009
A non-diabetic resident of an Ohio assisted-living facility died from injuries she sustained when the staff negligently gave her a diabetes medication, according to a lawsuit recently removed to federal court. Dennis Freudeman's lawsuit against the owner and operator of The Landing of Canton assisted-living community alleges that medication caused a dangerous drop in his mother's blood sugar level.
Briefs and Other Related Documents: 2009 WL 286781, 2009 WL 286788, 2009 WL 286789

FEDERAL TIME-COMPUTATION RULES TO BE CHANGED IN 2009, John H. Tatlock, Esq., 25 No. 3 Andrews Pharmaceutical Litig. Rep. 11, Andrews Pharmaceutical Litigation Reporter April 20, 2009
In the first installment of a two-part commentary attorney John Tatlock urges lawyers in all practice areas to familiarize themselves with pending changes in how deadlines are calculated in federal, civil, criminal and bankruptcy court proceedings. Sometime before Dec. 1, 2009, all attorneys practicing in federal court will begin familiarizing themselves with more than 170 proposed amendments to the federal time-computation rules.

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Recent nursing home litigation and potential theories of liability in the oven

NURSING HOMES ARE NOT BOUND BY 'RIGHT TO KNOW' LAW, FLORIDA SUPREME COURT RULES
In Benjamin v. Tandem Healthcare, 11 No. 15 Andrews Nursing Home Litig. Rep. 1, Andrews Nursing Home Litigation Reporter January 16, 2009, the Florida Supreme Court held that nursing homes are not governed by the "right to know" amendment to the Florida Constitution. That amendment [Article X, Section 25 of the Florida Constitution or “Amendment 7”] allows patients access to records relating to medical mistakes by health care providers. The six participating Justices agreed that the definition of "health care facility" in Amendment 7 did not include nursing homes.The Supreme Court relied on a "long_standing distinction" in Florida law between health care providers and nursing homes, governed by different statutes.

MINN. CARE HOME IS SUED OVER RESIDENT'S DEHYDRATION DEATH, Cole v. GGNSC Stillwater Greeley, 11 No. 15 Andrews Nursing Home Litig. Rep. 2, Andrews Nursing Home Litigation Reporter January 16, 2009
A 71_year_old dementia patient died from severe dehydration suffered during a three_week stay at a Minnesota nursing home, according to a federal court lawsuit filed by his son. The staff at the Golden Center Living Greeley facility in Stillwater is alleged to have failed to ensure that Dean Cole received adequate food and liquids during his December 2006 stay, Cole's son Kevin says in the lawsuit. Cole was hospitalized Dec. 29, 2006, after nursing home staff members found him unresponsive.

A WOMAN'S SERIES OF PROBLEMS LINKED TO FALL AT MICH. HOME, Link v. IHS Acquisition, 11 No. 15 Andrews Nursing Home Litig. Rep. 3, Andrews Nursing Home Litigation Reporter January 16, 2009
A Michigan woman alleges in a federal court lawsuit that neglect by a nursing home's staff caused a fall in which she suffered a broken hip, setting off a chain reaction of debilitating health complications. Nancy Link says she fell at the Lynwood Manor Healthcare Center because the staff failed to take the necessary precautions to ensure her safety. She seeks to hold the facility liable for her broken hip and a myriad of health complications that cropped up during her recovery.

OREGON HOME FACES $2 MILLION SUIT OVER SEX ASSAULT BY RESIDENT, Fellows v. Healthcare at Foster Creek, 11 No. 15 Andrews Nursing Home Litig. Rep. 4, Andrews Nursing Home Litigation Reporter January 16, 2009
A Portland, Ore., nursing home has been hit with a $2 million lawsuit alleging it failed to take adequate steps to prevent the sexual assault of a 61_year_old dementia patient by another resident. Staff members at the Healthcare at Foster Creek facility found the alleged victim naked from the waist down in the room of fellow resident Marko Chandler March 31, 2008, according to the complaint. However, the employees did not document or report the incident to authorities or take any action to prevent it.

MASS. NURSES LOSE BID TO FORCE DEATH SUIT INTO ARBITRATION, Constantino v. Frechette, 11 No. 15 Andrews Nursing Home Litig. Rep. 5, Andrews Nursing Home Litigation Reporter January 16, 2009
A group of nurses sued for wrongful death in connection with the care given to a Massachusetts nursing home resident cannot enforce an arbitration agreement between the facility and the resident, a state appellate court has ruled. The court said the agreement expressly limited its reach to disputes between the patient and the nursing home and did not cover individual claims against the facility's employees. This would seem to be an attempt at an end run around the express language of agreements to arbitrate liability issues.

Criminal Conduct: VETERANS HOME EXEC PLEADS NOT GUILTY TO CLEAN_AIR LAW RAP, 11 No. 15 Andrews Nursing Home Litig. Rep. 7, Andrews Nursing Home Litigation Reporter January 16, 2009
In an interesting lawsuit brought under the Clean Air Act, the director of a state_run nursing facility for veterans in Massachusetts has pleaded not guilty to charges that he ordered the illegal removal of a wall containing asbestos insulation without the proper cleanup procedures. Paul Morin, 56, of Chicopee, Mass., the superintendent of the Soldiers' Home in Holyoke, endangered the facility's employees and violated the state's Clean Air Act, Mass. Gen. Laws ch. 111, 142A, Attorney General Martha Coakley said in a Jan. 8 statement.

GOVERNMENT CAN RE_DEPOSE WITNESS HEADED FOR IRAQ IN VET SUICIDE CASE, Lucey v. Nicholson, 11 No. 15 Andrews Nursing Home Litig. Rep. 8, Andrews Nursing Home Litigation Reporter January 16, 2009
A Massachusetts federal judge has granted the U.S. government's motion to re_ depose a Department of Veterans Affairs social worker who is scheduled to deploy to Iraq and may not be available to testify at the May 2009 trial involving an Iraq War veteran's suicide. U.S. Magistrate Judge Kenneth P. Neiman granted a second deposition of Jaime Perez, a key plaintiffs' witness in the malpractice and wrongful_death suit brought by the parents of Jeffrey Michael Lucey.

SUIT SOUNDS IN MED_MAL, NOT SIMPLE NEGLIGENCE, N.J. COURT SAYS, Davis v. St. Barnabas Med. Ctr., 11 No. 15 Andrews Nursing Home Litig. Rep. 9, Andrews Nursing Home Litigation Reporter January 16, 2009
A New Jersey woman's suit was rightfully dismissed for failure to comply with the state's affidavit_of_merit statute since the complaint, as pleaded, sounded in medical malpractice and not simple negligence, a New Jersey appeals court has ruled. Viola Davis sued St. Barnabas Medical Center for injuries she sustained after she was admitted to the hospital in May 2005, was given a number of medications, and later wandered out of her room in a "drug_induced state" and fell. This is an interesting case because suits like this have been brought in Florida and some courts have held that those plaintiffs alleged premises liability claims and could, thus, circumvent presuit notice requirements.

DISPUTED CAUSE OF DEATH PRECLUDES ARIZ. HOSPITAL'S DISMISSAL, Lacombe v. Bullhead City Hosp. Corp., 11 No. 15 Andrews Nursing Home Litig. Rep. 12, Andrews Nursing Home Litigation Reporter January 16, 2009
Finding that the evidence before the court was not "so one_sided that one party must prevail as a matter of law," an Arizona federal judge has denied a hospital's motion for summary judgment in a wrongful_death lawsuit. Bullhead City Hospital Corp., the operator of the Western Arizona Regional Medical Center, argued that evidence showed that the death of David Nichols was not the result of an adverse reaction to penicillin, as alleged by his estate, but rather an enlarged heart and subsequent heart condition.

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