Friday, May 6, 2016

Charges Fly in Meningitis Court Filings

By Walter F. Roche Jr.

Saint Thomas Health of Nashville,Tenn. and related entities are asking a judge to dismiss most of the most serious claims against them in some 100 suits, contending they had no control over the clinic in which they held a 50 percent ownership interest.
In a series of filings in U.S. District Court in Boston, lawyers for Saint Thomas state that neither the health care nonprofit nor its employees "had any role in causing the contamination" that sickened over 100 Tennessee patients and killed 13 of them.
The health care firm's filings have triggered a sharp response from lawyers for victims of the 2012 fungal meningitis outbreak caused by fungus tainted spinal steroids injected in patients at Nashville's Saint Thomas Outpatient Neurosurgical Center.
"The record contains documents and testimony indicating that the Saint Thomas entities could and did exercise control over the Saint Thomas clinic," the rebuttal states, adding that Saint Thomas breached its duty by allowing the clinic to operate "below the required standard of care."
The Saint Thomas motion to erase liability claims, if granted, would likely have a substantial impact on the amount, if any, local victims can collect from trials scheduled to begin this summer.
In a recent filing with state regulators in Alabama for an upcoming bond issue, Saint Thomas' parent company, Ascension Health, in fact appeared to assume the motion would be granted and its liabilities sharply limited.
"The Tennessee Plaintiffs," the filing states," allege only vicarious liability against the Saint Thomas entities and the Ascension entities, where applicable, for the actions of Saint Thomas Outpatient Neurosurgical Center, Howell Allen Clinic and their employees."
The disclosure states that Ascension's management "does not believe this matter, if decided adversely to the defendants, would have a material adverse impact on the System's financial position or the results of operations as a whole."
In fact, as the court filings show, the motion to dismiss the liability claims is still pending before U.S. District Judge Rya Zobel.
In its 22-page memorandum seeking dismissal of the claims, the Saint Thomas entities contend that employees of the Howell Allen Clinic, the co-owner of the neurosurgical center, ran the outpatient center and were responsible for the decision to purchase steroids from the New England Compounding Center, the firm blamed for the 2012 meningitis outbreak.
"The Saint Thomas entities did not have any right of control over the operation of the (neurosurgical center) or the Howell Allen employees who ran it," the memo states, adding that all the patients treated at the clinic had been referred by Howell Allen doctors.
As a result, they concluded, "actual agency and direct liability claims should be dismissed."
The 27-page brief filed for plaintiffs by Nashville attorney Mark Chalos, cites internal Saint Thomas emails and deposition testimony to challenge the health care firms claims of non-involvement.
Quoted was an email from then Saint Thomas President Michael Schatzlein to Howell Allen which states,"You may be assured no one from Saint Thomas has referred to (the neurosurgical center) as an unaffiliated clinic."
Calling the Saint Thomas entities and the clinic "an indistinguishable tangle of related entities," the brief notes that it was Saint Thomas personnel who were assigned to contact patients after the outbreak became public in the Fall of 2012.
The brief also cites testimony showing that the chief pharmacist at Saint Thomas had ordered all pharmacy staff not to purchase drugs from any drug compounders and even contacted state drug regulators expressing concern about the legality of NECC's promise to deliver compounded drugs without patient-specific prescriptions.
While the ban was put in place at Saint Thomas non-profit entities, the filing states, the for profit neurosurgical center half owned by a Saint Thomas entity, purchased the tainted drugs from NECC.
In a reply to that brief, Saint Thomas attorney Sarah P. Kelly, charged that the Schatzlein email had been taken out of context and "facts doom" the direct liability claims.

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