June 2010

Products Liability - In In Re Chinese Drywall Products, 680 F. Supp 2d 780 (E.D. La. 2010), the court found that the "economic loss rule" did not apply to bar tort claims against the defendant manufacturer because Louisiana does not recognize the rule. Any challenges to claims of Louisiana plaintiffs must be brought under the Louisiana Products Liability Act.

Insurance - In Bradley v. Allstate Ins. Co., 606 F.3d 215 (5th Cir. 2010), the court outlined the proper calculation of actual cash value as "the cost of duplicating the damaged property with new materials of like, kind and quality, less allowance for physical deterioration and depreciation." The district court's use of the pre-storm market value was incorrect.

Insurance Penalties - In Hope-Kidd v. Stewart, No. 2010-141 (La. App. 3 Cir. 6/2/10), the Appellate Court affirmed a trial court ruling that refusal to award penalties where an insurer paid 97% of settlement funds within 30 days after the settlement was reduced to writing. Although the insurer's failure to pay $600.00 in accrued interest was technically in violation of LSA-22:1973(B) (2), the Court considered the failure as diminimus and rejected the demand for penalties and use of sanctions.

May 2010

Class Actions - In Shady Grove Orthopedic Association, P.A. v. Allstate Ins. Co., U.S. (2010), the United States Supreme Court ruled that a New York statute prohibiting class actions in suits seeking penalties or statutory minimum damages does not preclude a federal court sitting in diversity from entering a class action under Federal Rule of Civil Procedure 23. There was no unanimity among the justices as to the decision or the rationale.

Products Liability - In Chevron, USA Inc. v. Aker Maritime Inc., F. 3d (5th Cir. 2010), the U.S. Fifth Circuit, applying Louisiana law, came to these conclusions: (1) a jury was entitled to determine that the prescriptive period against the manufacturer did not start when the product first broke, where the evidence showed all involved had cause to conclude that the failure resulted from another source; (2) the "apparent manufacturer" doctrine under the Louisiana Products Liability Act applies when the buying public has a basis to assume that the seller may be the manufacturer of a product it distributed; and (3) the LPLA, and not redhibition, applies where the bolt which the buyer purchased damaged its property.

Unfair Trade Practices - In Cheramie Services, Inc. v. Shell Deepwater Production, Inc., No. 09-C-1633 (4/23/10) (Knoll, Johnson and Guidry, JJ, concurring), the Louisiana Supreme Court ruled that persons who are neither business competitors nor consumers nevertheless may bring an action for damages pursuant to the Unfair Trade Practices and Consumer Protection Law, R.S. 51:1401, et seq. Despite the conclusion that the statute contains no such limiting language, the Court concluded under the facts particular to this case that summary judgment dismissing the claims was appropriate. The evidence showed that the defendant-employees were merely exercising their prerogatives as at-will employees to change the companies for which they worked.

April 2010

Expert Testimony - In State v. Young, La. S. Ct., No. 2009-KK-1177 (4/5/10), the Louisiana Supreme Court held that expert testimony is not admissible on the issue of the general reliability of eyewitness identification. Justice Guidry observed that such testimony would not aid the jury in its deliberations and is likely to be more prejudicial than probative in value. One Justice felt that testimony of this nature would always be admissible and, in a concurrence, argued for a "bright line" rule of inadmissibility.

Prescription/Medical Malpractice - The Louisiana Supreme Court in Williamson v. Hebert, La. S. Ct., No. 10-CC-0071 (4/5/10) strictly construed the defense of prescription. In Williamson, the plaintiff experienced problems following a surgery. The factual record showed that she had real apprehension following her surgery and felt something "was wrong." However, two of her doctors assured her that her condition would continue to improve. When her symptoms did not improve, she performed computer research and learned for the first time that her symptoms may have been caused by malpractice.

The Supreme Court reached this decision even though existing Appellate Court jurisprudence supports the position that the plaintiff's knowledge that something was wrong following the surgery may be sufficient knowledge to begin the running of the prescriptive period.

Workers' Compensation - Last December, we reported on City of Dequincy v. Henry, --- So.3d ----, 2009 WL 4639519, (La. App. 3 Cir .12/9/09), where the Louisiana Third Circuit Court of Appeal held that the worker's compensation insurer who intervened in the employee's third-party tort suit is not entitled to a credit for future medical benefits even where the amount paid by the tortfeasor in its settlement with the employee exceeds the amount necessary to fully reimburse the workers compensation carrier for benefits already paid.

The Louisiana Supreme Court has recently granted writs in this case. We will continue to monitor this case because it may have important ramifications to intervention/subrogation cases in the workers' compensation context.

March 2010

Medical Liens - In Metcalf v. Christus Health Southwestern Louisiana, No. CA 09-869 (3/3/10), the Third Circuit took a strong position against the enforcement of liens for healthcare providers. The Court held that the lien of a healthcare provider against settlement proceeds or payment of a judgment is invalid unless the lien is sent by certified mail and includes the location of the healthcare provider. In all probability, the plaintiff's bar will use this ruling to justify a choice not to pay medical providers from proceeds received.

Workers' Compensation/Immunity - Pursuant to LSA-R.S. 23:1061, a principal obtains a rebuttable presumption that they are in an immune "statutory employer" when their contract designates the principal as a statutory employer. In Rainey v. Entergy Gulf States, Inc., La. S. Ct., No. 09-C-572 (3/16/10), the Louisiana Supreme Court upheld such a designation when only the typed signature of the principal's representative was on the contract addendum providing this statutory employer relationship. Further, the Court indicated that the addendum was effective even when only signed by the contractor's representative because the principal was the party who prepared and presented the contract addendum to the contractor. The principal's consent is presumed.

Mitigation of Damages - In Ferguson v. Loewer Powersports & Equipment, No. CA - 09-990 (3/17/10), the Louisiana Third Circuit held that a plaintiff's decision to not obtain medical testing did not constitute a failure to mitigate damages. In Ferguson, the plaintiff's physician recommended testing and medial treatment was delayed when plaintiff did not obtain the testing. However, the plaintiff did not undertake testing because: 1) he had no medical insurance; 2) he did not have funds to obtain the testing; and 3), although he had retirement savings, the plaintiff would have been penalized if he withdrew these funds. This decision is indicative of the Third Circuit's desire to maximize plaintiff's recovery.

February 2010

Federal Jurisdiction - In Hertz Corp. v. Friend, 130 S.Ct. 1181 (2010), the United States Supreme Court held that a corporation’s “principal place of business,” for purposes of federal diversity jurisdiction, under 28 U.S.C.S. § 1332, is its “nerve center.” The “nerve center” test examines where the corporation’s officers direct, control, and coordinate the corporation’s activities. In practice, the “nerve center” should normally be the place where the corporation maintains its headquarters. However, this requires the headquarters to be the actual center of direction, control, and coordination, not simply an office where the corporation holds its board meetings.

Products Liability - In DeMay v. Actavis, Inc., 593 F.3d 428 (5th Cir. 2010), the court held that Louisiana’s failure to warn claims, based on alleged inadequacy of generic drug labels, are not preempted by federal regulations. Currently, federal law requires generic labels to be the same as the name brand at the time of the initial Abbreviated New Drug Application (ANDA). The court found that Louisiana’s imposition of duties to warn on generic drug manufacturers neither renders compliance with federal regulation impossible nor obstructs the goals of the federal regulation.

Negligence - In Tyson v. King, (La. App. 3rd Cir. 2/3/10) 2010 WL 363862, the court held that the trial judge erred in sustaining summary judgment for the defendant solely because there was no contact with the plaintiff's vehicle in an automobile accident. The court found that there is no statutory or jurisprudential requirement of contact between vehicles for the imposition of liability in a motor vehicle accident.

January 2010

Med Pay Provisions - In Titus v. IHOP Restaurant, Inc.. 09-951 (La. 12/1/09), the Louisiana Supreme Court held that the payment of "med pay" under a liability insurance policy does not constitute an acknowledgment of general liability for damages. The Court reasoned that "med pay" benefits are no fault medical payment obligations which arise from an obligation entirely different than a defendant's tort responsibilities.

Insurance - In Six Flags, Inc. v. Westchester Surplus Lines Insurance Company, _______ So.3d. _____ (5th Cir. 2009), the Court held that the presumption that a contract must be interpreted against the party who furnishes the text does not apply to an unambiguous insurance contract or where the insured is a sophisticated commercial entity that utilizes an agent to secure the desired policy provisions.

Medical Malpractice - The recent 2nd Circuit decision in Ebarb v. Willis Knighton Medical Center (La. App. 2 Cir. 1/6/10), 2010 WL 22772 upheld a jury verdict in favor of defendants where a 12 year old patient died after suffering a stroke in the hospital's intensive care unit. Despite evidence that an MRI may have been helpful, the Court found that it was not the duty of the hospital/ER doctor to order an MRI.

The Court rejected arguments that the ER doctor possessed a heightened duty of care. Instead, the Court observed that a physician is required only to exercise the degree of skill ordinarily employed by his professional peers under similar circumstances. A physician is not to be held to a standard of absolute precision; rather his conduct is evaluated in terms of reasonableness under the circumstance then existing without the benefit of "hindsight."

December 2009

In City of Dequincy v. Henry, --- So.3d ----, 2009 WL 4639519, (La. App. 3 Cir.12/9/09), the Louisiana Third Circuit Court of Appeal reaffirmed its holding in Breaux v. Dauterive Hosp. Corp., 02-1072 (La. App. 3 Cir. 2/5/03), 838 So.2d 109, that a workers compensation insurer who intervenes in the employee's third-party tort suit is not entitled to a credit for future medical benefits. According to the court, this is true even where the amount paid to the employee in settlement exceeds the amount necessary to fully reimburse the workers compensation carrier for benefits already paid.

In City of Dequincy, the court also affirmed the trial court's decision to deduct from the workers compensation carrier's future indemnity credit the amount assigned in the settlement documents for the loss of consortium to the employee's family. This deduction was appropriate because the amount allocated to settle the consortium claims was only a small percentage of the entire settlement, thereby distinguishing cases where all or a large part of the settlement was attributed to a loss of consortium.

Finally, the City Of Dequincy court also affirmed the trial court's finding that the intervening employer and its workers compensation carrier had provided written approval of settlement between the employee and the third-party tortfeasor such that the employee did not forfeit the right to future workers compensation benefits. The employee and third-party tortfeasor reached their settlement agreement in a private mediation conference not attended by the employer or its workers compensation carrier. Although the employer and carrier declined to attend mediation, the court accepted an advance e-mail to the mediator agreeing to a one third waiver of the lien as sufficient written approval of the settlement.

November 2009

Medical Review Panels - the Third Circuit Court of Appeal holds that a nursing home claim involving allegations of improper staff training and a failure to properly monitor or observe a patient must be submitted to a medical review panel. Of course, the nursing home was a qualified health care provider. Hernandez v Diversified Healthcare-Abeville, LLC, Third Circuit, CA 09-546 (11/4/09.

Patient Compensation Fund - In the case of Cubley v Willis-Knighton, No. 44,435-CA (11/4/09), the Louisiana Second Circuit confirmed the two instances where the Patients Compensation Fund is liable: 1) a settlement for an amount at or above $100,000; or 2) a judgment in the amount of $100,000 or more following trial. A settlement for less than $100,000 does not result in a liability determination by which the PCF is bound.

Judicial Interest - The judicial interest rate for 2010 has been set at 3.75%.

October 2009

In Gonzales v Kissner, an animal control officer went to investigate a dog bite by the landowner's dog, a 100 pound Shepherd. While the wife of the landowner and the officer were talking outside the house, the dog somehow escaped from inside the house and bit the officer twice. There had been two previous occasions of the dog's escapes, and the landowner had knowledge of the dog's dangerous propensities. The First Circuit rules that (1) the owner is strictly liable under CC Article 2321; landowner's conduct is so blameworthy that tort recovery should be allowed as a punishment or deterrence, and (2) the officer's recovery is not barred by the "Professional Rescuer's" doctrine. 2009 WL 3029621 (La. App. 1 Cir. 9/11/09)

The Fourth Circuit recently ruled if a statute or contract allows a party to collect reasonable attorney's fees, an attorney representing himself or herself may in general be entitled to collect such fees, unless the statute or contract clearly indicates otherwise. Gaden v Galvin, 2009 WL 3052633 (La. App. 4 Cir. 9/25/09)

SEPTEMBER 2009

FAILURE TO MITIGATE DAMAGES: The Louisiana Fourth Circuit Court of Appeals recently held that an injury victim does not fail to mitigate his/her damages when he/she refuses surgery when the surgery would not significantly alleviate the disability; carries risks of failure; would be painful; or the patient is unable to pay for the treatment. Flemings v State, 2007-1290 (La. App. 4th Cir. 8/26/09), 2009 WL 2751146. The decision could weaken the mitigation defense in certain scenarios. At least in the Forth Circuit, a plaintiff may be able to overcome the failure to mitigate defense by proving that he/she cannot afford the surgery or that it carries risks of failure.

ATTORNEY ADVERTISING: The Louisiana Supreme Court recently amended Rule 7 of the Rules of Professional Conduct which relates to lawyer advertising. The amended Rule became effective on October 1, 2009. The Rule, as amended, greatly limits attorney adverting, including advertising that touts prior client recovery or implies a guarantee of results.

http://www.ladb.org/NXT/gateway.dll?f=templates$fn=default.htm$vid=ladb:ladbview

However, on September 22, 2009, the Louisiana Supreme Court issued an order suspending enforcement of certain provisions of amended Rule 7. A copy of the Order can be viewed at the following address.

http://www.lsba.org/2007MemberServices/Advert0609/ROPC_
ARTICLEXVI_REVISEDSEPT222009.pdf

The suspension was prompted by the Eastern District of Louisiana's decision in Public Citizen, Inc. v. Louisiana Attorney Disciplinary Board, 2009 WL 2390866 (E.D. La. 2009), which held that certain disclosure requirements for celebrity spokespersons and limitations and filing requirements for internet advertising were unconstitutional. The suspension is effective until further notice.

 July 2009

A recent 3rd Circuit case stands for the proposition that imposing liability for spoliation of evidence is not appropriate unless the record shows intentional destruction of evidence for the purpose of depriving the opposing party of use of that evidence. Arnold v. Brookshire Grocery Co., 09-44 (La. App. 3d Cir. 5/6/09).

The 4th Circuit has ruled that if a party provides limited information to a potential expert, and then declines the future services of this expert, an adverse party involved in the litigation is free to retain this expert at a later date. Safeguard Storage Properties, LLC v. Donahue Favre Contractors, Inc., 2009-C-0344 (La. App. 4th Cir.).

The 1st Circuit recently discussed the issue of whether or not an attorney must have express authority from the client to enter into a binding agreement to settle the client's case. See Dozier v. Rhodus, 2008-CA-1813, (La. App. 1st Cir. 05/05/09). While the issue may not be completely resolved, the First Circuit seems to suggest that the attorney does not need express authority from the client to bind the client to a settlement. However, the argument can be made under Civil Code Article 3071 that a written consent to settle from the client is necessary.

June 2009

Class Actions: The Fourth Circuit Court of Appeal recently affirmed a decision of the Civil District Court of New Orleans denying class action certification to a class of plaintiffs claiming injuries due to emissions from the Mobil Oil Corporation plant in St. Bernard Parish.

In Thomas v. Mobil Oil Corporation, 2008-0541 (La. App. 4 Cir. 3/31/09), 2009 WL 1027168, the class representatives filed suit on behalf of over 7,000 residents of St. Bernard Parish for various damages allegedly suffered by the class. The class alleged that the damages were caused by numerous "flares" from the Mobil Oil plant for a period of 14 years.

The court found that a class action was an inappropriate procedural vehicle to litigate the plaintiffs' various claims: "If this [case] were to proceed as a class action [it] would quickly disintegrate into [an] unmanageable multitude of small suits with individual issues and evidence, violating the policy of judicial efficiency which the class action is designed to serve." Id. at *8. The case involved numerous class members claiming varying injuries allegedly caused by emissions occurring at different times and affecting different areas of St. Bernard Parish. "[T]here are just too many variables as to how various putative class members may have been exposed or affected that need to be resolved on an individual basis to allow for a workable class." Id. at *8.

Class Actions: Insurance: The Fourth Circuit Court of Appeal recently upheld the certification of a class action against an insurer by claimants whose homes were damaged during Hurricane Katrina. In Press v. Louisiana Citizens Fair Plan Property Insurance Co., 2008-1313 (La. App. 4 Cir. 4/22/09), 2009 WL 1098720, the claimants filed suit against the insurer for failure to pay General Contractor Overhead and Profit expenses incurred by the putative class members when repairing their homes. The court found that common questions regarding the insurer's alleged breach of contract predominated any individual questions presented in the case. Thus, the claimants met the requirements of Louisiana Code of Civil Procedure article 591 and the class was certified.

May, 2009

The Louisiana Supreme Court in its recent decision of Cutsinger v. Red Fern, 2009-WL-1425619 (La) clarified the impact of the "collateral source rule" under Louisiana law in the context of UM coverage. The plaintiff, Mary Cutsinger, sued State Farm as an uninsured motorist carrier arising from a motor vehicle accident on December 12, 2006. At the time of the accident, the plaintiff was in the course and scope of her employment and was paid worker's compensation benefits by her employer.

State Farm asserted that it was entitled to reduce its payments under the UM policy by the amount of worker's compensation benefits paid pursuant to a policy provision. The plaintiff asserted that the State Farm provision was contrary to public policy and in violation of the collateral source rule. The Supreme Court held that the plaintiff/worker's compensation benefits are not a "collateral source" as a matter of law. Consequently, the uninsured motorist carrier was allowed to reduce its payments by the amount paid by the worker's compensation insurer. As such, the State Farm policy language was not against public policy and was enforceable as a matter of law.

April, 2009

La. C.C.P. art. 592(3)(a)(1) requires that plaintiffs move for class certification within 90 days of service of all adverse parties. The state Fifth Circuit Court of Appeals recently held that the deadline imposed by La. C.C.P. art. 592(3)(a)(1) is not extended by the filing of amended petitions naming additional defendants. Sellers v El Paso Industrial Energy, L.P., 2009 WL 330382 (La. App. 5 Cir. 2/10/09).

In Thomas v. Mobil Oil Corp., 2009 WL 1027168 (La. App. 4 Cir. 3/31/09), the state Fourth Circuit Court of Appeals continued the recent trend of denying class certification of mass tort chemical exposure cases. In that case, the Court affirmed the District Court's denial of class certification, and found that individual issues among the many plaintiffs would predominate, which necessarily precludes class certification. Specifically, the Court noted that the plaintiffs were exposed to differing concentrations of chemicals on different days for different time periods. In this regard, the Court focused on the need to prove specific causation as to each individual plaintiff.

 March, 2009

The Louisiana Supreme Court denied writs in Spine Diagnostics Center of Baton Rouge, Inc. v. Louisiana State Board of Nursing, No. 2009-C-0188 and No. 2009-C-1044. Now final, this decision will have nationwide impact concerning the practice of medicine. In this litigation, our firm represented trained physicians who sought to prohibit certified registered nurse anesthetists from performing interventional pain management procedures typically performed by physicians. A permanent injunction was granted in favor of the physician group on the basis of testimony that nurses do not have the training possessed by physicians to perform many of the involved medical procedures.

The Louisiana First Circuit in Teague v. St. Paul Fire & Marine Insurance Company, No. 2006-CA-1266R confirmed an insurer's sole and exclusive right to decide whether or not to settle a professional liability suit where there is no "consent to settle" clause. The Appellate Court ruled that the defendants (represented by our firm in this litigation) caused no damage to the plaintiff. In the process, the Teague Court held that a failure to post a jury bond does not constitute actionable legal malpractice and that a legal malpractice claimant can not recover emotional damages unless the subject matter of the underlying litigation exclusively involved non-economic claims such as child custody disputes.  

January, 2009

On October 31, 2008, the Supreme Court announced that the Court's recently adopted amendments to the Rules of Professional Conduct pertaining to lawyer advertising will become effective April 1, 2009 instead of December 1, 2008 as previously announced. Although the form prescribed by the Insurance Commissioner does not provide a marked space for the company name, a UM waiver that fails to state the name of the insurer is not a valid waiver of UM coverage. Issuance of the form was accompanied with instructions to include the name of the insurance company on the form. Gingles v Dardenne, Third Circuit, No. CA 08-448 (11/26/08) In Broussard Physical Therapy v Family Dollar Stores, Inc., the Supreme Court rules that a worker compensation judge does not have subject matter jurisdiction to adjudicate a third party demand for defense and indemnification filed by an employer and its insurer against a PPO (preferred provider organization), where the main demand alleges that a health care provider was underpaid reimbursement for medical bills in violation of the reimbursement schedule of the worker compensation law. No. 08-CC-1013 (12/2/08) (Johnson, J, concurring)

December, 2008

Key ruling - Keogh, Cox & Wilson obtains key ruling which will impact practice of medicine nationwide: Court limits CRNA scope of practice and declares interventional pain management is solely the practice of medicine.

Scope of Practice: Appellate Court upholds permanent injunction preventing CRNAs from attempting practice in the field of Interventional Pain Management.

Keogh, Cox & Wilson partner, John Wolff and other members of the firm served as lead counsel in a significant case that serves to clearly delineate the lines that separate medicine from nursing. The case was initiated when the Louisiana Board of Nursing (LSBN) unilaterally declared that CRNA could practice interventional pain management procedures to include epidural steroid injections, peripheral nerve blocks and spinal facet injections. In the first phase of the case, Keogh, Cox & Wilson represented Spine Diagnostics, a local group of physicians with Dr. Michael Burdine and obtained a preliminary injunction from the 1^st Circuit Court of Appeal after the court found that the evidence submitted at trial established a prima facie case that CRNAs did not traditionally practice in the field of interventional pain management.

Keogh, Cox & Wilson was then retained by the American Society of Intervention Pain Physicians (ASIPP) along with Spine Diagnostics to pursue a permanent injunction preventing the CRNAs from practicing in this field. After 3 days of trial testimony, the trial court ruled, among other things, that the practice of interventional pain management is solely the practice of medicine and that it was not within the CRNA scope of practice.

The 1^st Circuit affirmed the trial court after a full discussion of the evidence. The court carefully examined the rigorous training requirements and regulation that physicians impose on this subspecialty. In contrast, the court noted that CRNAs do not receive training in this field as part of their certification and further noted that nursing organizations do not impose any regulation on CRNA practice in this field. As such, the court noted that CRNAs do not traditionally practice in the field, and therefore, the court upheld the permanent injunction prohibiting such practice.

Recusation of judges: Recently La. C.C.P. Art. 663 was amended to make mandatory certain grounds of recusal that had been discretionary. Now, in Louisiana state courts, a judge must be recused when: he or she was ever employed or consulted with an attorney in the case; is the spouse of a party or of an attorney employed in the cause; the judge's parent, child or immediate family member is a party or attorney employed in the cause; or the judge is biased, prejudiced or interested in the case, or prejudiced toward or against the parties or their attorneys or any witness to such an extent that he would be unable to conduct fair and impartial proceedings.

Maritime law: The McCorpen rule, under which A seaman's willful concealment of a pre-existing condition will defeat recovery for maintenance and cure, does not apply to the seaman's Jones Act claim. However, it can constitute contributory negligence in the Jones Act claim in the event the seaman's concealment of material information about a pre-existing injury or physical condition from his employer exposes his body to a risk of reinjury or aggravation and, as a result, a reinjury or aggravation of a prior injury occurs. Johnson v. Cenac Towing, Inc., ___ F. 3d___ (5^th Cir. 2008).

Prescription; Interruption; Insurance: Recently, the Fourth Circuit held that the unconditional payment of the undisputed amounts of a first party property damage claim made by an insurer to its insured, pursuant to its statutory obligation under R.S. 22:658(A)(1), does not constitute an acknowledgment of the insurer's liability sufficient to interrupt prescription on the insured's claim seeking additional amounts under the policy. Lila v. Underwriters at Lloyd's, London, No. 2008-CA-0681 (9/10/08). At least in the Fourth Circuit, this serves to limit the effect of Mallett v. McNeal, 939 So. 2d 1254 (La. 2006), to an insurer's unconditional payment to a third party claimant.  

October, 2008

INSURANCE: COMPULSORY VEHICLE LIABILITY

- By Act 921 of 2008, the legislature increased the minimum limits for compulsory motor vehicle liability insurance to $15,000 per person, $30,000 per accident, and $25,000 in property damages. The Act is effective on January 1, 2010, and applies to new policies issued on or after that date.

MEDICAL MALPRACTICE

- The Louisiana Supreme Court recently held in Borel v Young, No. 07-C-0419 that the one year and three year time bar periods in the Medical Malpractice statute [La. R.S.9: 5628] are prescriptive and not preemptive. Therefore, the time periods are subject to possible interruption or suspension. This is a reversal of an earlier Supreme Court decision on the same subject and will preserve more claims from dismissal.

- La. Act 558, effective August 15, 2008, made changes relevant to medical malpractice claims, to include:

August, 2008

MEDICARE TAKES AIM AT THIRD PARTY LIABILITY INSURANCE

Congress passed Senate Bill 2499 entitled "Medicare and Medicaid Extension Act of 2007." Under this bill, third party insurers are considered primary payers and are obligated to reimburse Medicare for conditional payments. All medical bills related to an accident for which Medicare tenders conditional payments are subject to this obligation to reimburse. Further, the primary payers are also obligated to place Medicare on notice of claims for which the primary payer should have made a primary payment.

Senate Bill 2499 also places an obligation on third party insurers to determine if the claim is Medicare eligible and also to place Medicare on notice of entitlement to benefits. Third party insurers are also required to take Medicare's interest into account with regard to future obligations. The Centers for Medicare Services has not defined a framework for settlement of third party liability cases. However, Medicare Set Aside Accounts have long applied in Worker's Compensation cases and these guidelines can be used as a starting point.

LIABILITY FROM EMPLOYERS WHO FAIL TO RETAIN WORKERS COMPENSATION COVERAGE

The Louisiana Legislature passed Act 705 to amend and reenact Louisiana Revised Statute 23:1171.1 (C)(1) related to an employer's duty to provide workers compensation insurance. If a workers compensation court determines that an employer failed to obtain workers compensation insurance, the court may fine the employer up to $10,000 and order the employer to secure Workers Compensation insurance within 90 days. Failure to do so will result in the judge issuing a cease and desist order prohibiting the employer from conducting business until such time as the employer complies and all fines are paid in full.

PRETRIAL MOTIONS FOR EXPERT WITNESSES

The Louisiana Legislature adopted Act 787 which mandates that a motion to challenge the qualifications or methodology of an expert witness be filed at least 60 days prior to trial. The court must render an opinion in writing and outline the reason upon which it ruled. The 60 day requirement may be waived by leave of court and by unanimous consent of the parties.

Spring, 2008

• The Louisiana Supreme Court upheld the water damage exclusion in Sher v. v. Lafayette Ins. Co., 07-2441 (La. 4/8/08), - So.2d - , 2008 WL 928486, and gave it effect to exclude flood-related damages resulting from the breached levees. In making this ruling, the court determined the use of the undefined term "flood" in the policy did not create an ambiguity; applying its generally prevailing meaning the term encompasses all instances, regardless of cause, of the overflow of water over normally dry land.


• The Sher Court also held that the pertinent statutory penalty percentage is determined by the date on which the penalty cause of action arose, thereby rejecting the position that an insurer's ongoing duty of good faith and fair dealing permitted application of the enhanced penalty for all claims pending after the effective date (8/15/06) of the statutory amendment. It also determined mental anguish damages are not recoverable for a breach of a commercial all-risk insurance contract, that C.C. article 1997 does not permit the recovery of attorney fees, and judicial interest on a statutory penalty award accrues only upon the date of the judgment.

• In Bellard v. American Central Ins. Co., 07-1335 (La. 4/18/08), - So.2d - , 2008 WL 1764953, the Louisiana Supreme Court recently determined the UM carrier is entitled to a credit for medical and disability benefits paid on behalf of the worker by the worker's compensation carrier; in so ruling, the court found the UM and workers compensation insurance carriers were solidary obligors and refused to apply the collateral source rule.

December, 2007

• The Louisiana Supreme Court recently limited its prior holding in Duncan v. USAA Ins. Co., 06-363 (La. 11/29/06), 950 So.2d 544, rehg. denied, 2/16/076, in which it had held that the UM rejection form was invalid because of the absence of a policy number on the UM waiver form. The law in Louisiana is now that the lack of a policy number does not invalidate the form if the policy number is not available at the time the rejection form is signed. Carter v. State Farm Mutual Auto. Ins. Co., 07-1294 (La. 10/05/07), 964 So.2d 375.



• One Louisiana Appellate Court maintains that, even though it would not support a claim of spoliation of the evidence, the inadvertent breach of a statutory duty to preserve records is actionable in negligence. Longwell v. Jefferson Parish Hosp. Serv. Dist. No. 1, 07-259 (La. App. 5 Cir. 10/16/07), 2007 WL 3015260. This ruling is contrary to prior Louisiana cases that have refused to recognize the tort of negligent spoliation of evidence.



• Louisiana law permits a neighbor who is deprived from enjoying its property to recover damages from the offensive neighbor. La. C.C. art. 667. Under this article, a Louisiana appellate court has refused to find liability on a non-resident lessor-owner for excessive noise emanating from the leased premises. Yokum v. 615 Boubon Street, L.L.C., 06-1057 (La. App. 4 Cir. 6/20/07), 960 So.2d 1283. Please note the Louisiana Supreme Court recently granted writs on this res nova issue.

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