"Can cell phones cause brain cancer?" With that question, which he did not answer, Judge Weisberg of the Superior Court for the District of Columbia began a 76-page discourse on the admissibility of the testimony of eight plaintiffs' experts in the DC cell phone litigation. The Court excluded the testimony of some of the Plaintiffs' experts and did not exclude the testimony of others. The Court, based on the extensive record before him, clearly found the scientific evidence too inconclusive for any scientist to say to a reasonable degree of scientific certainty whether cell phones can cause brain cancer.
The Court's opinion included this sobering plea to other branches of government to do the research necessary to figure this out:
Even though the financial and social cost of restricting such devices would be significant, those costs pale in comparison to the cost in human lives from doing nothing, only to discover thirty or forty years from now that the early signs were pointing in the right direction. As the inconclusive results of the IARC Monograph make clear, more research is necessary to answer definitively the fundamental question of carcinogenicity. If the probability of carcinogenicity is low, but the magnitude of the potential harm is high, good public policy dictates that the risk should not be ignored. See Richard Posner, Catastrophe: Risk and Response (2004). The court recognizes, however, that policy debates of this kind do not belong in the judicial branch.
I had previously written about judicial estoppel and lack of standing defenses that could arise from a plaintiff's prior bankruptcy filing. There is a recent decision in the District of Columbia in which judicial estoppel barred a plaintiff's personal injury claim, after the plaintiff had failed to disclose the claim in bankruptcy proceedings. To prevail on such a motion, however, it is probably necessary to show a clear financial benefit accruing to the plaintiff from the failure to disclose the claim in bankruptcy.
It's so annoying to have to search every time I want to use the DCRA's Corporations Division CorpOnline Portal. Why does the DCRA make this so hard to find? This is where to go for online search of all registered District of Columbia entities with expanded entity information. This is the DC equivalent to Maryland's State Department of Assessments and Taxation website.
In Interstate Fire and Casualty Co. v. Washington Hospital Center Corp., No. 10-1193 (D.D.C. March 28, 2012), the Court was faced with a dispute between two insurers as to the proper allocation of the cost of a multi-million dollar settlement of a medical malpractice action. The Court awarded summary judgment to Interstate, thus requiring the Washington Hospital Center's insurer to reimburse Interstate for a settlement of $3,055,000, plus fees and expenses.
To understand the dispute, a brief discussion of the underlying claim is required.
The underlying action was a medical malpractice claim brought in Superior Court by a patient against the Washington Hospital Center and two doctors. The Washington Hospital Center filed a third-party complaint against a temporary nurse staffing agency, Progressive Nursing Staffers of Virginia, Inc., and a temporary nurse involved in the plaintiff's post-op care. The third-party complaint was based, in part, on a contractual indemnification clause in Progressive's contract with WHC (the "Temporary Staffing Agreement"). The Washington Hospital Center was insured by Greenspring Financial Insurance Limited ("GFIL"). The nursing staff agency and the temporary nurse were insured by Interstate Fire and Casualty Company ("Interstate"). The medical malpractice action was settled for a total of $4,105,000, of which Interstate paid $3,055,000 and GFIL paid the remainder. The settlement agreement, however, was drafted to as to preserve Interstate's rights to seek reallocation of the settlement.
Following the settlement, Interstate filed a declaratory judgment action in D.C. federal court to pursue reallocation of the settlement. Interstate's arguments, in essence, were that the temporary nurse it supplied to WHC was, for purposes of GFIL's insurance, an employee of WHC, and that under the "other insurance" clauses of the GFIL policy and the Interstate policy, GFIL was primary and Interstate was excess. After some discovery, the parties filed cross motions for summary judgment.
The District Court awarded summary judgment to Interstate, finding that the temporary nurse was an employee within the meaning of the GFIL policy. This finding was based on the fact that it was undisputed that WHC had the right to control the temporary staffing nurse's conduct while working at WHC. This included the right to determine and ascertain what the assignment of the individual nurse would be, and what kind of medical care or attention to give to a particular patient. Although Court did not find all the relevant factors governing the employee/employer relationship weighed against WHC, the power to control the servant's conduct is the most important factor, and along with the weight of some other factors, was enough to lead the Court to find that the temporary nurse and WHC had an employee/employer relationship.
Interestingly, the Court noted that the Temporary Staffing Agreement specified that Progressive nurses remain Progressive employees. The Court found that that was parol evidence that it could not consider when interpreting the insurance contract between WHC and GFIL, and secondly, that nothing in D.C. law would prohibit the finding that the temporary nurse was en employee of both Progressive and WHC at the time of her alleged negligence.
The District Court also found that under the competing "other insurance" clauses, Interstate was clearly in an excess position.
The District Court did not find it necessary to reach the question whether the responsibility for covering the temporary nurse's liability was determined by the indemnification agreement in the Temporary Staffing Agreement, because the Court found that WHC had given Progressive a complete general release of any liability under the Temporary Staffing Agreement.
The Temporary Staffing Agreement included an indemnification clause under which Progressive was required to "indemnify WHC for claims arising from the negligence of Progressive or its registered nurse employees who were provided to WHC", and the indemnification clause served as the basis for the third-party complaint filed by WHC in the underlying action. The District Court found that "the indemnification clause was waived by the broad language of the Settlement Agreement . . . [in the medical malpractice action]."
Consequently, as a result of the Settlement Agreement, GFIL lost its right to step into WHC's shoes to sue for indemnification. Thus, the Court rejected GFIL's argument against circular litigation, i.e., that if the Court finds it liable, GFIL through subrogation, could file suit against Progressive for indemnification, and Progressive would then seek reimbursement from Interstate, resulting in Interstate being ultimately responsible.
Impact: This decision underscores that in any case where a settlement agreement is drafted so as to "carve out" one side's rights to pursue a coverage reallocation action, the other side must be equally careful to preserve its position in the anticipated coverage action.
Here's a link to a useful page on the Superior Court website (on the Court's new website) that contains links to pdfs of the Court's General Orders, links to the individual Judges' Supplemental Orders, and to Mediation Orders. The Supplemental General Orders vary depending on the individual Judge, so it is important to refer to them regarding motion practice and discovery disputes.
Alternative fee agreements have received a lot of favorable press in recent years, with the praise usually coming in tandem with criticism of the billable hour.
However, there is a dark side to alternative fee agreements. Because a law firm's obligations to its clients extend beyond mere contractual duties, the law firm which undertakes matters under an alternative fee agreement can be exposed to wildly disproportionate risks.
Some of these risks are illustrated by the recent decision in Cunningham & Associates v. ARAG, LLC, No. 11-1983 (D.D.C. Jan. 31, 2012), in which a law firm brought suit against an insurance company providing pre-paid legal services. As recounted by the District Court, the law firm alleged that under its agreement with ARAG, it undertook the legal representation of four of the defendants' insureds in four different matters which collectively demanded over 900 hours of attorney time, but for which the defendants allegedly only paid $2,300.00 to date. The defendants then terminated their contract with the plaintiff law firm, which termination was in the law firm's view due to defendants refusal to reimburse the firm for reasonable fees and expenses incurred.
The law firm recently filed suit against the defendants, alleging fraud, negligent misrepresentation, breach of the implied contractual duty of good faith and fair dealing, quantum meruit, unjust enrichment, and violations of the D.C. Consumer Protection Act. In its complaint, the law firm sought damages of $140,715.00 in compensatory damages plus interests and costs, $422,145.00 in compensatory and treble damages under the consumer protection statute, attorney's fees, and $500,000 in punitive damages. The attachments to the complaint included the ARAG Attorney Network Application, the ARAG Attorney Agreement, and the ARAG North America, Inc. Attorney Reimbursement Fee Schedule (which are all available through PACER for anyone interested).
In its opinion, the District Court granted the defendants' motion to compel mediation, and stayed the action for 45 days so that mediation could take place. The contract between the parties required four hours of non-binding mediation in Des Moines, Iowa.
The District of Columbia Court of Appeals has again adopted the pleading standards under Rule 8(a) as construed in Ashcroft v. Iqbal, 129 S.Ct. 1937 (2009) and Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007). See Potomac Dev. Corp. v. District of Columbia, No. 10-CV-632 (D.C. Sept. 15, 2011), slip op. at 18 & n. 4.
The Court had previously adopted the plausibility standard in Mazza v. HouseCraft, LLC, 18 A.3d 786 (D.C.), which was vacated as moot, 22 A.3d 820 (D.C. 2011) thanks to a settlement between the parties there.
In the Potomac Development decision, the Court noted that "Because of the persuasiveness of the vacated opinion in Mazza, we draw on it here."
Quoting Iqbal, the Court stated that Rule 8 does not unlock the doors of discovery for a plaintiff armed with nothing more than conclusions.