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Caps on Non-Economic Damages Held Unconstitutional

By Pamela Sakowicz Menaker, Litigation News Contributing Editor – June 2, 2014


A cap on non-economic damages in wrongful death medical malpractice cases is unconstitutional, according to the Florida Supreme Court. Florida becomes the eighth state supreme court to strike down statutorily enacted medical malpractice damage caps. The others are Alabama, Georgia, Illinois, Missouri, New Hampshire, Oregon, and Washington, according to the American Association of Justice (AAJ).

The Florida legislature approved a cap on non-economic damages in all medical malpractice cases in 2003. The ruling in Estate of Michelle Evette McCall v. U.S., however, rejects statutory provisions that capped non-economic damage payments in wrongful death cases at $500,000 or $1 million, depending upon the number of medical providers or plaintiffs involved.

Eleventh Circuit Certifies State Constitutional Questions to Florida Supreme Court
McCall involved the case of 20 year-old Michelle McCall who bled to death following a cesarean section during the birth of her son at a U.S. Air Force clinic in Florida. McCall’s parents and the father of her son filed suit against the United States under the Federal Tort Claims Act. At trial, non-economic damages totaled $2 million, including $500,000 for her young son and $750,000 for each of her parents, but the district court reduced the award to $1 million because of the 2003 law.

The family appealed the ruling to the U.S. Court of Appeals for the Eleventh Circuit, challenging both the application and the constitutionality of the cap mandated by Florida law. The Eleventh Circuit then certified four questions challenging the cap to the Florida Supreme Court.

Court Finds Non-economic Damages Cap Arbitrary
In a 5–2 decision, the Florida Supreme Court held that the way the caps reduced damages is “arbitrary and unrelated to a true state interest,” and it “offends the fundamental notion of equal justice under the law.” The court continued: “The statutory cap on wrongful death non-economic damages fails because it imposes unfair and illogical burdens on injured parties when an act of medical negligence gives rise to multiple claimants.”

In explaining the damages cap violation of the state’s equal protection clause, the court observed that the statute “has the effect of saving a modest amount for many by imposing devastating costs on a few—those who are most grievously injured, those who sustain the greatest damage and loss, and multiple claimants for whom judicially determined non-economic damages are subject to division and reduction simply based upon the existence of the cap.”

Reliability of Malpractice “Insurance Crisis” Statistics Questioned
The court also questioned the reliability of the statistics upon which the legislature initially relied in passing the law over a decade ago: “[T]he statutory cap on wrongful death non-economic damages does not bear a rational relationship to the stated purpose that the cap is purported to address, the alleged medical malpractice insurance crisis in Florida.” The court commented that “the finding by the Legislature and the Task Force that Florida was in the midst of a bona fide medical malpractice crisis, threatening the access of Floridians to health care, is dubious and questionable at the very best.”

The court also noted that between 2003 and 2010, four medical malpractice insurance companies increased their net income by more than 4,300 percent. Given that increase, the court wrote, “the insurance industry should pass savings onto Florida physicians in the form of reduced malpractice insurance premiums.”

The court also noted that there was no evidence to suggest that a large increase in the number of ”frivolous” lawsuits had been filed in Florida or that there was any evidence of excessive jury verdicts in the past three years.

Ruling Follows Trend in Other Jurisdictions
Two other states, Ohio and Oklahoma, have state constitutional prohibitions on damage caps in wrongful death medical malpractice cases. But some plaintiffs’ attorneys argue that the prohibition on caps in Florida also applies to all medical malpractice cases, says Ervin A. Gonzalez, Coral Gables, FL, member of the ABA Section of Litigation. Plaintiffs’ attorneys will likely treat the Florida Supreme Court decision as if it applied to all medical malpractice cases, not just those involving wrongful death, Gonzalez observes, but that the issue will likely be tested again in the state’s high court.

Five states—Arizona, Arkansas, Kentucky, Pennsylvania, and Wyoming—have state constitutional prohibitions on damage caps, according to the American Association of Justice.

Section Leaders’ Reactions
“The Florida Supreme Court decision was split among the justices along their “historic lines of right and left viewpoints,” says Professor James T. O’Reilly, Cincinnati, OH, co-editor of the Section of Litigation’s Products Liability Newsletter and author of ABA Press “Medical Malpractice: Avoiding, Adjusting & Litigating in the Challenging New Climate.” “Each state supreme court,” O’Reilly adds, “will be free to make its own evaluation of the ‘alleged’ medical malpractice crisis when determining how to handle the caps issue.”

Plaintiffs’ bar members view this change as long overdue and see the decision as indicative of a continuing trend. “We have successfully challenged caps on damages in medical malpractice cases in Illinois three times, once specifically in medical malpractice cases, and three times the Illinois Supreme Court has found them to be unconstitutional,” says Keith A. Hebeisen, Chicago, IL, chair of the ABA Standing Committee on Medical Professional Liability. “Victims of medical malpractice have a right to have liability and damages determined by a jury of their peers, not by an arbitrary cap determined by a politicized legislature,” Hebeisen observes.

The plaintiffs’ bar waited for the “right case” to come along, says Gonzalez. “Trial lawyers certainly see it as a very positive thing and you can likely expect it to be happening in other states,” he says, “but it has to be the right factual pattern and the issues must be raised exactly correct.”

Members of the defense bar have a different view. “Multiple states, as the dissent in McCall points out, have rejected equal protection challenges to statutory caps on non-economic damages, “says Sonia E. O’Donnell, Miami, FL, cochair of the Section’s Appellate Practice Committee. “The Florida Supreme Court stands in contrast to those decisions,” O’Donnell continues. “It rejects legislative conclusions on the malpractice crisis in Florida and conducts a de novo review of malpractice issues. A question exists as to whether, in its rational basis analysis, the court disregarded the Florida legislature’s role under the Florida Constitution,” says O’Donnell.

Keywords: caps, non-economic damages, medical malpractice, equal protection clause

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