January 15, 2006 Recent Legal News

Fraud and Abuse




Product Liability

Peer Review

Fraud and Abuse

US v Altiere
ND Ohio

An attorney was charged with fraud and the charge was upheld since there were disputed facts that need to be determined by a jury.  Attorney James Altiere received an eight count indictment for fraud while employed by Medback, Inc.  The company and the attorney conspired to charge for medical and not chiropractic services. The defendant has claimed entrapment.  This requires a jury to decide.   

Shareholders v Tenet

Tenet and the shareholder have agreed to settle the suits accusing the company of fraud.  The company will pay after insurance money of $140 million.  Tenet still is up against the US for its billing and physician recruitment methods.       Top


Daily v Kaiser Hospital
Cal. Ct. App.

Daily, a hospital worker, had complained to management about many concerns including a breach of patient confidentiality.  What did Kaiser do to reward her was to fire her.  She sued for wrongful discharge and won in the lower courts a judgment of $941,300 for economic damages and $150,000 for emotional distress.  Kaiser appealed but lost since Daily had properly identified state whistleblower protection and she was fired after blowing the whistle to the DHS regarding breach of confidentiality.  Kaiser had made false accusations against Dailey and she was treated differently than other employees.  The final straw was the lies of the director of Dailey's Department.  This was an unpublished opinion so it can not be used for official precedent but can be used for a guide for others that want to sue their employers for wrongful termination after whistleblowing.

Dunn v Washington County Hospital
7th Circ.

A nurse accused an independent contractor physician of sexual harassment.  The lower court dismissed the complaint since the physician was not an employee and the hospital had no control.  That decision was reversed by the 7th.  They ruled that a Title VII suit did not give rise to a tort but direct and not derivative.  The hospital has a duty to provide a nondiscriminatory work environment.  The hospital knew of the harassment and did nothing.  The lower court will need to determine if the physician's conduct rose to the level of sexual discrimination and whether the hospital failed to take appropriate action in response. 

Nurses v Virginia Mason

Virginia Mason decreed that all its employees must be vaccinated by January 1 against the flu.  The nurses union filed a grievance against the fiat.  An arbitrator ruled the decree violated the contract to negotiate with the nurses.  The hospital appealed and in the USDC lost again.  The union agrees that flu shots are great but should not be a condition of employment and now they are not. 

Peek & Levine v Spartanburg Sys.
       SC Ct. App.

The hospital entered into an exclusive contract with a group of anesthesiologists that left out Drs. Peek and Levine.  They sued the healthcare system for an injunction to allow then to remain on staff.  The lower and upper courts both agreed that a loss of the doctors' practice would occur if an injunction was not put into place.  This would cause irreparable harm. 

Boice-Willis Clinic v Seaman
NC Ct. Appeals

North Carolina in an unpublished opinion stated that if the terms of the restrictive covenant are reasonable the covenant is legal and not against public policy.  The Court looked at how many general surgeons were present in the entire area of restriction and found 13.  The public would not be harmed if Dr. Seaman were not allowed to practice for the allotted time.  The court talked about the difference between harm to the public versus a mere inconvenience to the public. The court also found that the trial court could not rewrite or revise a covenant not to compete unless it is overbroad and the language is distinctly severable.  Here neither are present and any editing by the trial court was not allowed.           Top


Community Hospital v Blume 
NJ App. Ct.

An attorney firm had obtained confidential health information of patients to use in a med mal claim against the hospital.  The nefarious attorneys then wrote to other patients to see if they had similar problems at the hospital.  The patients complained to their physicians that they had not given permission to have their names released to the dark side attorneys.  The hospital sued the "attorneys" Blume Goldfaden Berkowitz Donelly Fried & Forte, PC for the return of the ill gotten names and the forbidding of the use in any law suit.  The firm countersued for fees since the suit according to them was frivolous.  The lower court through out both claims.  The hospital could not assert the claims in behalf of the patients, even under HIPAA.  The attorney's suit was just stupid.  

Kaiser Permanente in Redondo Beach California  had its patient records stolen and used for identity theft and obtaining false credit cards.  This was two employees who stole the information.  The real crime is the system that allowed the employees to access and steal the information.  Kaiser prides itself on its electronics should hang its head in shame.  The two felons were employed by a photocopying company hired by Kaiser to copy patient's medical records.  When Kaiser goes to full electronic records there will be no further need for paper copying of medical records.  

Raue v County of Oakland
Mich. Ct. App.

Having a medical degree is no indication of smarts.  A physician sued the county after a policeman would not let him close the door while examining a prisoner that the police was supposed to watch.  The doctor sued for lack of privacy under HIPAA.  There is no physician right of privacy.          Top


Christman v Davis
Vt. Supreme Ct.

The patient sued a surgeon for battery for doing a less invasive procedure than he had stated.  This was a dental case and the dentist decided to do less than he originally planned.  The procedure did not work.  The patient's attorney decided after filing for informed consent, malpractice and battery to go just on battery.  Here there may have been lack of informed consent but not battery.  The attorney needs to be sued for legal malpractice.

Oraee v Breeding
Va. Supreme Ct.

The physician Oraee, a neurologist, dismissed the patient from the hospital without obtaining the results of the tests requested by another physician.  This caused the death of the patient.  There is an immunity statute in Virginia for physicians who do not review tests not ordered by physicians.  Here the test was ordered by a physician and so the physician was liable.  This was a split decision since the Court had previously ruled in Auer v Miller that immunity attaches to all lab tests not ordered by the defendant physician.

Rudenauer v Zafiropoulos
Mass. Supreme Ct.

The state statute of limitations for med mal claims cannot be tolled even if the treatment is ongoing after the time of the alleged negligence.  The plaintiff saw the defendant urologist who diagnosed a left renal mass and followed it for 21 months until the mass was not visible.  Years later the patient had left flank pain and was found to have renal cancer.  He died.  Massachusetts has no tolling of the statute and therefore there can be no case.   

Medved v Glenn
Utah Supreme Ct.

The court ruled that a plaintiff may plead damages based on the increased risk of cancer recurrence due to delayed diagnosis as long as there is a simultaneously pled present injury.  The plaintiff sued a plastic surgeon and an OB for not diagnosing breast cancer in a timely fashion leading to more invasive procedures that would have been necessary.  The high court stated that when a plaintiff suffers an actionable injury she may recover damages for not only the harm already suffered but also for possible future damages.

Patients v Hartford Hospital
To Be Filed

Hartford Hospital has paid a $100,000 fine for shoddy and negligent patient violations.  One was connecting a feeding tube to an IV.  Another was an IV into the carotid artery.  I don't understand who is hiring and training the people working at the hospital but I would not want to be a patient or physician at the hospital. 

Patients v Charlotte Hospitals
To Be Filed

Patients at four Charlotte hospitals have been told they have received tissue transplants from a New York funeral home.  To date none of the recipients have had any untoward effects from the ill gotten tissue.  The tissue had been stolen and not screened for infection prior to the

Irvine v Eisenberg
Filed Legal Malpractice

The plaintiff Irvine sued her attorney for pressuring her into accepting a settlement when she sued the University of California Irvine.  She was the one that blew the whistle on the University's policy of not accepting livers for their patients.  She accepted a $50,000 settlement from the University.  The University will lose millions in these suits.  This may be more than the $20 million it paid out ten years ago in the infertility scandal.  Irvine states in her suit that Eisenberg rushed to settlement and did not tell her pertinent information until after the settlement.  Eisenberg then tried to have the settlement set aside and that lost.

Wiosinski v Cohn
Mich. Ct. App.

The plaintiff won $1.5 million for a wrongful death for not getting an informed consent for a kidney transplant.  That was fortunately overturned since the lack of informed consent was because the surgeon did not tell the patient his own statistics.  There is no law stating that this is part of informed consent.        

Taylor v Jersey City Med Ctr.
NJ Super Ct.

It's hard to believe but a hospital actually wanted a summary judgment after it did not notify the family of a patient that died for three months.  The hospital also led the family to believe the patient was still alive.  The court stated that a duty existed if the emotional distress was foreseeable.  No question here.        Top

Product Liability

HCA v Danek Med, Inc.
Texas Ct. App.

The patient was injured by an internal fixation device placed post spinal surgery.  The patient settled with Danek, the manufacturer and requested the court dismiss the claims against the hospital and physician.  The hospital then filed a suit against Danek to recoup its losses.  Since the underlying suit was not a product case but negligence, Danek was off the hook.  The underlying suit was not for product liability but for a product grossly misused.  Not a real good statement for the patients to continue to use the hospital.        Top

Peer Review

Naples Hosp. v Hussey
Fla. Dist. Ct.

The physician sued after the hospital refused to renew his privileges due to a business decision and would not give him a fair hearing.  The physician was a pain management specialist.  The hospital entered into an exclusive contract with another pain medicine physician.  The suit claimed the hospital violated its bylaws.  The court affirmed that the bylaws were a contract between the physician and the hospital.  The court also stated that in this case there was no right to a hearing since the decision was not based on competency but on a business decision.        Top


DISCLAIMER: Although this article is updated periodically, it reflects the author's point of view at the time of publication. Nothing in this article constitutes legal advice. Readers should consult with their own legal counsel before acting on any of the information presented.