When Is Medical Malpractice More Than Negligence
- And Are Punitives Warranted?

By Barbara D. Goldberg

"Punitive" or "exemplary" damages are awarded not to compensate the injured party, as are damages for pain and suffering or lost earnings, but to punish the wrongdoer for egregious conduct and serve as a deterrent to others who might be similarly inclined. For this reason, punitive damage awards in medical malpractice cases have been relatively rare tp date, although a trend toward awarding punitives may be in the formative stages. There are certain instances, however, in which punitive damages might be warranted. Some of these were discussed last month, and further examples, involving attempts to conceal malpractice and intentional misconduct, are provided below.

Alteration Of Medical Records

In Moskovitz v. Mt. Sinai Medical Center, 69 Ohio St.3d 638, 635 N.E.2d (ohio 1994), a physician failed to diagnose and treat a malignant tumor on an elderly patient's leg in a timely manner. Although the defendant noticed the presence of a calcified lump near the patient's Achilles tendon, he assured her that it was no cause for concern and made no attempt to have it biopsied. Because no treatment was provided, the cancer metastasized and ultimately caused the patient's death.

After another physician diagnosed the cancer, the defendant altered the patient's medical records in an attempt to conceal the fact that the malpractice had occurred. He added notations indicating that the patient did not want a biopsy and that he would continue to observe the condition. The Supreme Court of Ohio held that such conduct exhibited a total disregard for the law and the rights of the patient and her family, and that accordingly, punitive damages were warranted. The court stated that the intentional alteration, falsification or destruction of medical records in an attempt to avoid liability for malpractice was sufficient to show actual malice so as to support an award of punitive damages.

Significantly, the appellate court allowed the claim for punitive damages even though the defendant's conduct in altering records - which occurred after the cancer had metastasized - did not directly cause injury to the patient. The court reasoned that since the purpose of punitive damages is to punish and deter certain conduct, it would make no sense to establish a rule requiring that malicious conduct giving rise to a claim for punitive damages independently cause compensable harm before punitive damages may be awarded:

If the act of altering and destroying records to avoid liability is to be tolerated in our society, we can think of no better way to encourage it than to hold that punitive damages are not available in this case. We believe that such conduct is particularly deserving of punishment in the form of punitive damages and that a civilized society governed by rules of law can require no less. [The defendant's] conduct of altering records should not go unpunished. We should warn others to refrain from similar conduct and an award of punitive damages will do just that.

Intentional Conduct

Punitive damages may also be allowed in cases where the plaintiff's allegations establish that a physician or health care provider was guilty of intentional misconduct, such as an assault or sexual misconduct, towards a patient. Indeed, punitive damages may be allowed in such cases even where they are otherwise prohibited by statute in medical malpractice actions. A case in point is Johnson v. Vemuri, 1994 U.S. Dist. LEXIS 17621 (N.D. Ill. 1994), decided under Illinois law.

The plaintiff in Johnson alleged that the defendant psychiatrist had commenced a sexual relationship with her on which she became dependent emotionally. Among other things, plaintiff alleged that the sexual relationship was "contraindicated psychiatrically," and that it violated the Illinois Sexual Exploitation in Psychotherapy Act. Plaintiff sought both compensatory and punitive damages.

Defendants moved to dismiss the claim for punitive damages on the ground that Illinois law prohibited the recovery of punitive damages in medical malpractice actions. The relevant legislation, enacted in response to a perceived litigation crisis in the Illinois medical community, provided in pertinent part that "[i]n all cases . . .in which the plaintiff seeks damages by reason of legal, medical, hospital, or other healing art malpractice, no punitive, exemplary, vindictive or aggravated damages shall be allowed."

The court denied the motion, reasoning that the sexual contact at issue was never alleged to have been a part of the plaintiff's psychotherapeutic treatment, or to have any other "healing arts" purpose. Accordingly, a claim for punitive damages was not barred by the statute. In this regard, the court relied on Lamson v. Hagen, No. 5-87-0771-72, 1989 Ill. App. LEXIS 1333 (Ill. App. Aug. 31, 1989), an earlier case which had allowed a claim for punitive damages against a chiropractor based on improper sexual contact. The Lamson court reasoned that "[i]t would be outside the realm of logic to conclude that a defendant's actions, which were unrelated to a treatment, must be considered under the medical malpractice provisions simply because of the time frame during which the events occurred."

Once a court has determined that punitive damages may be recovered, the next question is how to determine an appropriate award. In theory at least, the amount of punitive damages is supposed to bear a reasonable relationship to actual damages, although the line between "reasonable" and "excessive" damages is not always clear. Beyond this there are few guidelines, for while some states impose caps on punitive damages, the determination of what represents an appropriate award of punitive damages in a given case is usually left to the jury.

Significantly, however, the U.S. Supreme Court has recognized that the Due Process Clause of the 14th Amendment imposes substantive limits on the extent of punitive damage awards. In BMW of North America v. Gore, 517 U.S. 559, 134 L.Ed. 809, 116 S.Ct. 1589 (1996), the Supreme Court held that punitive damage awards are subject to due process protection on the theory that "[e]lementary notions of fairness enshrined in our constitutional jurisprudence dictate that a person receive fair notice not only of the conduct that will subject him to punishment, but also of the severity of the penalty that a State may impose." The Court, in addition, identified three criteria for determining whether an award of punitive damages is so excessive as to violate due process:

1. the degree of reprehensibility of the defendant's conduct;
2. the ratio between compensatory damages and the amount of punitive damages; and
3. the difference between the punitive damages and the amount of civil or criminal penalties that could be imposed for the same conduct.

Applying these standards, the Court in Gore held that an award of $2 million in punitive damages was excessive and constitutionally impermissible, given the low level of reprehensibility of the defendant's conduct and a 500-to-1 ratio between punitive and compensatory damages.

More recently, in Cooper Industries, Inc. v. Leatherman Tool Group, Inc., ___ U.S. ___, 121 S.Ct. 1678 (2001), the Supreme Court announced that "courts of appeals should apply a de novo standard of review when passing on district courts' determinations of the constitutionality of puntive damage awards." Such a ruling is likely to be beneficial to the defense in that it will allow closer appellate scrutiny of punitive damage awards than an "abuse of discretion" standard, which requires deference to the determination reached by the trier of fact.

In addition to the guidelines set forth in the Gore case, a defendant's net worth has also been a relevant factor in determining an appropriate award of punitive damages. This is demonstrated by Valbona v. Springer, 43 Cal. App. 4th 1525, 51 Cal. Rptr. 2d 311 (Cal. App. 4th Dist. 1996), an action for fraud and other theories against a physician, his wife, and his medical clinic arising out of the physician's professional negligence in intentionally misrepresenting the effectiveness of laser surgery to remove cellulite. In Valbona, the court held that punitive damage awards in the total amount of $200,000 against all three defendants were supported. The court reasoned that (1) this was less than three times the total compensatory damages award; (2) the total punitive damages award left the physician and his wife with over $600,000, which was almost 77 percent of their demonstrated net worth; and (3) the jury could reasonably have inferred that the clinic owned a laser worth $77,000.

The foregoing discussion is by no means an exhaustive discussion of all the possible fact patterns where punitive damages may be allowed, or all the factors that, in a given case, may be relevant to a determination of excessiveness. Moreover, in some states, the recovery of punitive damages is regulated by statute. Oregon law, for example, provides that punitive damages may be awarded against hospitals, but not against health care practitioners such as doctors and nurses. Ore. Rev. Stat. § 18.550 (Supp. 1998). (In addition, if punitive damages are awarded in Oregon, 60 percent must be paid to the Criminal Injuries Compensation Account, and not more than half of the plaintiff's 40 percent may be treated as attorney fees.)

In jurisdictions where punitive damages are allowed, however, the cases discussed above are illustrative of the different types of conduct that have given rise to claims for punitive damages in a medical setting. As such, these and similar cases provide a useful measure of comparison for determining whether the claims in a particular case rise to the level of the "reckless indifference" to a patient's well-being that is likely to support a claim for punitive damages.

From a risk management perspective, as well, these cases emphasize the importance of careful and accurate charting and documentation of treatment. Careful and contemporaneous documentation of a patient's symptoms may support a claim that a conservative course of treatment was justified, or at least did not rise above simple negligence, while the absence of accurate documentation may be seen as proof of indifference to the patient's condition, and invite a claim for punitive damages.

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