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No double dipping in litigation, Md. high court says

Saying there’s no double dipping in civil litigation, a unanimous Maryland high court this week barred a car-crash victim from pursuing a subsequent medical malpractice claim after finding she was fully compensated for all injuries by the auto insurance company.

In its 7-0 decision, the Court of Appeals applied the “one satisfaction rule” to prevent Michele Gallagher from seeking compensation for Mercy Medical Center’s alleged negligence after reaching a settlement with State Farm Mutual Automobile Insurance Co. that covered the injuries from the crash and the alleged malpractice.

“Under the one satisfaction rule, once the plaintiff has obtained a full satisfaction, he or she is prevented from pursuing another who may be liable for the same damages,” Judge Clayton Greene Jr. wrote for the high court. “If the satisfaction only compensated the plaintiff for the injuries he or she initially sustained from the automobile accident, the plaintiff’s claim for injuries that resulted from the subsequent malpractice is not barred. If, however, the satisfaction compensated the plaintiff for all of the injuries he or she sustained from the automobile accident and the malpractice, the plaintiff’s medical malpractice claim is barred by the one satisfaction rule.”

The litigation arose when Gallagher’s car was struck from behind in January 2009 by a vehicle driven by Phuong Nguyen.

The injured Gallagher underwent two reconstructive breast surgeries at Mercy, after which she developed an infection that required her to receive antibiotics via a catheter placed in her left arm. While being inserted, the catheter accessed or punctured an artery, which necessitated vascular surgery followed by rehabilitation, the high court’s opinion stated.

Gallagher reached a $25,000 settlement with Nguyen, which represented the limit of his coverage with Nationwide Mutual Fire Insurance Co.

Gallagher pursued a lawsuit in Baltimore City Circuit Court against State Farm, her uninsured/underinsured motorist carrier, seeking $1 million in compensation for injuries and losses not covered by Nationwide.

During pretrial discovery, Gallagher submitted to State Farm her medical bills related to the breast surgery, subsequent infection, vascular surgery and rehabilitation. Her doctors at Mercy provided pretrial testimony under oath to explain Gallagher’s condition and the bases for the medical bills.

Shortly after opening statements in January 2015, Gallagher settled with State Farm for $125,000.

The following year, Gallagher sued Mercy in Baltimore City Circuit Court, alleging medical malpractice during the catheterization procedure. Baltimore-based Mercy moved for dismissal, arguing that Gallagher could not pursue a claim against the hospital because she was fully compensated by State Farm for her injuries.

The circuit court agreed, as did the intermediate Court of Special Appeals.

On appeal, Gallagher’s counsel argued that the one satisfaction rule bars additional recovery only after a trial and judgment, not following a settlement in which the plaintiff receives less than full compensation in return for forgoing the time and expense of a trial.

But the high court said it would not “rename the ‘one satisfaction rule’ the ‘one judgment rule.’”

“Here, by accepting a settlement, petitioner (Gallagher) evaluated – for herself – her claim against State Farm,” Greene wrote.

“She weighed her claim’s value against the risk of placing her fate in the hands of the jury,” Greene added. “Where, as here, petitioner enters into an entirely voluntary settlement for the injuries that she sustained, she cannot ask the court to conduct a post hoc appraisal of the value of her claims.”

Attorney Kathleen Howard Meredith, who represented Gallagher before the high court, stated in an email that the one satisfaction rule should not apply in cases such as her client’s in which the recovery from the auto insurer was only “partial satisfaction” of the personal injury claim.

“Our position was that the injured party should be free to accept a partial satisfaction of her claim from the initial tortfeasor, and thereafter to pursue her claim against other tortfeasors until she actually receives ‘one full satisfaction,’” stated Meredith, of Iliff, Meredith, Wildberger & Brennan P.C. in Pasadena. “The court’s decision means that an injured party, who accepts a partial settlement with one tortfeasor, cannot pursue additional remedies against other tortfeasors, unless the settlement document with the first tortfeasor clearly states an intention to pursue additional remedies against other tortfeasors to full satisfaction.”

Mercy’s attorney, Mairi Pat Maguire, did not return telephone and email messages Wednesday seeking comment on the high court’s ruling. Maguire is with Pessin Katz Law P.A. in Towson.

The Court of Appeals rendered its decision in Michele Gallagher v. Mercy Medical Center Inc., No. 44, September Term 2018.


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