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Missouri Law Blog Legal updates, news, and commentary from the attorneys of Baker Sterchi Cowden & Rice LLC

Update: Hopping on the Missouri Bandwagon? Not so Fast Out-of-State Litigants.

May 20, 2019 | Megan Sterchi Lammert

In this March 18, 2019 blog post, we reported on important pending legislation that could substantially change Missouri’s venue rules. In case you missed the news, look no further….

At the beginning of May, the Missouri House passed the venue and joinder bill (Senate Bill 7) by a 100-46 vote. The bill primarily aims to restrict non-Missouri plaintiffs from joining their claims, in the same lawsuit, with those of a Missouri resident, where the non-residents’ claims have no legal nexus to Missouri. Read more here and here.

Next stop? Governor Mike Parson’s desk for signature, which will likely occur based on positive statements he has made about the bill: “[p]assing venue and joinder reform is a huge win and will provide long overdue relief to Missouri businesses that have been taken advantage of by rampant abuse of our state’s legal system….I look forward to signing these positive reforms to improve our state’s competitiveness, strengthen our legal climate, and bring fairness to our courtrooms.” 

Prior to its passage, while the House did not change the Senate’s language, there was not a lack of effort by some opponents in the House. For example, the “innocent seller” provision of the bill caused a bit of an uproar with some members. This provision discourages lawsuits against a defendant whose liability is based only on its status as a seller in the stream of commerce, permitting such a defendant to seek to be dismissed from a lawsuit. Certain House members challenged this provision in light of the current law not divesting a Missouri court of venue or jurisdiction  against  such a defendant in the event of a dismissal that was otherwise proper at the time the lawsuit began. However, Senate Bill 7removes that protection. Opponents of the bill argued that removing the current provision could force a lawsuit naming such a protected innocent seller entity to move to another county or state. Proponents of the bill countered that this was a prudent way to prevent plaintiffs from unnecessarily suing anybody and everybody in the manufacturing and distribution chain.

The House opponents were unsuccessful, Senate Bill 7 was passed.  It will officially become law once it receives the Governor’s stamp of approval.

Supreme Court of Missouri Issues First-Of-Its-Kind Ruling Overturning a $2.3 Million Negligent Credentialing Verdict

March 28, 2019 | John Mahon, Jr.

In Thomas E. Tharp, et al. v. St. Luke's Surgicenter – Lee's Summit, LLC, the Supreme Court of Missouri overturned a $2.3 million jury verdict in favor of a patient and his wife against a hospital, because there was no proof the hospital negligently granted staff privileges to a surgeon. The opinion is the first from the Supreme Court of Missouri to address the requirements of a negligent credentialing claim. 

The plaintiff alleged injuries stemming from a surgical procedure to remove his gallbladder. The plaintiff and his wife settled their claims with the surgeon, but went to trial against the hospital alleging it negligently granted privileges to the surgeon. At trial, plaintiffs presented evidence that the surgeon failed to disclose to the hospital all prior malpractice suits.

The hospital filed a motion for directed verdict at the close of all evidence on two grounds: (1) There was insufficient evidence to establish it had been negligent; and (2) the act of granting privileges to the surgeon was not the proximate cause of the injury. The trial court denied this motion, and the jury returned a verdict in favor of the plaintiffs. The trial court also overruled the hospital’s post trial motion for judgment notwithstanding the verdict, asserting the same arguments set forth above.

In a 6-1 decision, the Supreme Court held that a breach of the hospital’s bylaws (requiring the surgeon to report all prior malpractice suits) was not enough to support a negligent credentialing claim, and found no evidence that the grant of staff privileges to the surgeon was the proximate cause of the injury.

Addressing the nature of the relationship between a modern healthcare facility and its medical staff, the Court observed that “Physicians working under staff privileges are typically independent contractors, not hospital employees,” and that “staff privileges allow physicians to utilize a healthcare facility to admit and treat patients as independent care providers rather than as employees of the facility.” Under appropriate circumstances, a negligent credentialing claim can provide an avenue for potential liability against a hospital for injury caused by an independent contractor. The focus is whether the hospital gathered pertinent information to make a reasonable decision as to whether to grant privileges. The proper inquiry is whether the physician was competent and possessed the necessary knowledge, skill and experience to perform his job without creating unreasonable risk of injury to others.     

One of the requirements in the hospital’s bylaws was full disclosure of all prior malpractice suits, and the failure to do so was grounds to automatically remove a physician from staff privilege consideration. The evidence at trial showed the surgeon failed to list on his application each suit he had defended over his career, but there was no evidence that addressed the surgeon’s qualifications to perform surgery. The plaintiff’s own expert admitted there was no “magical number” of malpractice suits that shows a surgeon is unqualified. Further, plaintiff’s expert cited a statistical study showing physician malpractice claim rates vary widely depending, in large part, on the medical specialty involved. “Even acts of repeated negligence do not support a finding a surgeon is incompetent when there is no evidence that shows a surgeon generally lacks a professional ability.” Thus, the Court found the plaintiffs failed to make a submissible case of negligent credentialing. 

The Court also found the plaintiffs failed to prove the credentialing of the surgeon was the proximate cause of the injury. It was not enough to prove that but for the credentialing, the surgeon could not have performed the surgery that produced the injury. Rather, the plaintiffs needed to prove the injury was the natural and probable consequence of the surgeon’s incompetence. “Even a supremely qualified, competent, and careful physician may nevertheless injure a patient through an isolated negligent act.” Because plaintiffs failed to show the surgeon was incompetent, they could not prove the injury was the result of the surgeon’s incompetence and thus failed to make a submissible case.    

In this first ruling of its kind in Missouri, the Missouri Supreme Court has provided guidance to Missouri lower courts and practitioners prosecuting or defending a negligent credentialing claim. These claims are difficult to prove, as they require proof beyond that which is required to support a malpractice claim against a physician. Absent credible evidence of a physician’s incompetence generally, and the negligent failure of a hospital to discover the incompetence and act accordingly, courts should dispose of these claims via dispositive motion.     

The opinion did not address whether the negligent credentialing theory conflicts with Mo.Rev.Stat. § 538.210.4, which provides, in part, that “[n]o health care provider whose liability is limited by the provisions of this chapter shall be liable to any plaintiff based on the actions or omissions of any other entity or individual who is not an employee of such health care provider . . . .” Negligent credentialing liability necessarily depends on the negligent act or omission of a non-employee physician. In the event this argument is raised, it is unclear how the Court would address the apparent conflict of law.   

Hopping on the Missouri Bandwagon? Not so Fast Out-of-State Litigants.

March 18, 2019 | Megan Sterchi Lammert

In an effort to overhaul Missouri’s current venue and joinder laws, Missouri lawmakers introduced Senate Bill 7, aimed at restricting non-Missouri plaintiffs from joining their claims in the same lawsuit, with those of a Missouri resident, even though the non-residents’ claims have no legal nexus to Missouri. The most immediate and prominent impact of the bill, if enacted, would be upon mass tort litigation. The bill also limits the use of joinder in product liability cases, prohibiting joining claims arising out of separate purchases or separate incidents related to the same product. 

Following its introduction, Senate Bill 7 was revised to adopt the February 13, 2019 Missouri Supreme Court ruling in State ex rel. Johnson & Johnson v. Burlison. The Missouri Senate subsequently passed the revised version on March 4, 2019.  The Johnson & Johnson case dealt with the talcum powder litigation filed in St. Louis City Circuit Courts, involving many plaintiffs with both non-Missouri and Missouri residents, and held that plaintiffs cannot use joinder rules to establish venue in a jurisdiction where it otherwise would not exist. 

Senate Bill 7 moved onto the House, which recently considered similar legislation. See House Bill 231.  As of March 6, 2019, the Senate bill was read and referred to the Judiciary Committee. 

Proponents of the legislation say that it will help address “a crisis” in Missouri’s courts, where out of state plaintiffs have flocked to litigate their claims in perceived plaintiff-friendly venues, such as St. Louis City (which has been dubbed a “Judicial Hellhole” by the defense bar); and Jackson County, which includes the greater Kansas City area.  The Senate bill’s sponsor, Ed Emery, notes that out of the 13,252 mass tort plaintiffs involved in cases being heard in St. Louis City, only 1,035 are Missouri residents.

Proponents of the bill say that its passage will also have significant economic benefits, because Missouri taxpayers are currently paying for out of state plaintiffs to clog the Missouri courts with claims that have nothing to do with Missouri, thus taking up precious judicial resources that would better be used to adjudicate the claims of Missouri citizens.  Opponents of Senate Bill 7 primarily argue that it makes sense to have groups of plaintiffs, who all purportedly suffered similar injuries, to bring their claims together in the same court and lawsuit. 

The current bill contains “grandfather” provisions, making the legislation inapplicable to any action that meets two criteria:  (1) the action is pending as of February 13, 2019 (when the Supreme Court decided Johnson & Johnson), and (2) the action is set for trial on or before August 28, 2019 (the date on which the new legislation is scheduled to take effect.). 

If enacted, this legislation may significantly alter the landscape of tort litigation in Missouri, both for litigants, and for the judiciary (especially in St. Louis City and Jackson County).  Companies that do business in Missouri should follow its progress closely.
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The BSCR Missouri Law Blog examines significant developments, trends and changes in Missouri law on a broad range of topics of interest to Missouri practitioners and attorneys and businesses with disputes subject to Missouri law. Learn more about the editor, David Eisenberg.

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