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ZITOMER v. MEDICAL PROTECTIVE CORPORATION

June 1, 2004.

NORMAN ZITOMER, ET AL.
v.
THE MEDICAL PROTECTIVE CORPORATION, ET AL.



The opinion of the court was delivered by: JOHN PADOVA, District Judge

MEMORANDUM

Plaintiffs, Norman Zitomer and Elissa Young, have brought this action seeking a declaration that Defendants are responsible for payment of all delay damages and post-judgment interest awarded in Young v. Zitomer, et al., Philadelphia County Court of Common Pleas, March Term 1999, No. 1993 ("Young v. Zitomer"). Before the Court are Defendants' Motion for Summary Judgment and Plaintiffs' Motion for Partial Summary Judgment. For the reasons which follow, Plaintiffs' Motion is granted and Defendants' Motion is granted in part and denied in part.

I. BACKGROUND

  Norman Zitomer is a physician who practices in Philadelphia. (2d Am. Compl. ¶ 1.) In 1996 he purchased medical malpractice insurance policy no. 547080 from The Medical Protective Company ("MedPro") with a term from July 7, 1996 to July 7, 1997 (the "Policy"). (Defs.' Ex. B.) The Policy is an occurrence policy which provides coverage in the amount of $200,000 per occurrence, with a total annual aggregate limit of $600,000. (Id.) On March 15, 1999, Dr. Zitomer and six other defendants were sued in the Court of Common Pleas of Philadelphia County for medical malpractice by Elissa Young, one of Dr. Zitomer's patients, for negligence that occurred in April and May 1997, during the policy period. (Pls.' Ex. A.) Ms. Young alleged in her complaint that, as a result of the negligent care provided by the defendants, including Dr. Zitomer, she suffered from multiple septic emboli and her left foot was amputated. (Id. ¶¶ 16, 30, 33, 34.) MedPro retained Kevin Wright, Esquire to represent Zitomer in Young v. Zitomer. (Defs.' Ex. C.) On October 1, 2001, five weeks prior to the November 5, 2001 trial of Young v. Zitomer, MedPro sent a letter to Zitomer enclosing a consent/non-consent to settle form. (Id.) The letter notified Zitomer that he had the right to consult his own attorney, at his own expense, regarding the case, and asked him to indicate on the form whether he consented to MedPro entering into a settlement discussion if MedPro determined it to be reasonable to do so. (Id.) Defendants claim that Zitomer did not consent to settle. (Defs.' Statement of Undisp. Facts ¶ 14.) Zitomer disputes this. (Pls. Resp. to Defs. Statement of Undisp. Facts ¶ 14.)

  Young v. Zitomer went to trial in November 2001. A MedPro claims representative approached Zitomer during the trial regarding settlement and claims that Zitomer did not give his consent to settle. (Defs.' Ex. D.) Plaintiffs maintain that the claims representative did not give Zitomer all of the information he needed to make a decision about settlement and did not ask him to consent to settle. (Zitomer Dep. at 29, Alff Dep. at 43-44, 49-50.) On November 16, 2001, the jury returned a verdict in favor of Young and against all defendants in the amount of $20,800,000. Young v. Zitomer, Corrected Order (July 29, 2002). The jury apportioned 60% of fault to Zitomer. (Id.) On July 29, 2002, the trial court molded the jury verdict to include an award of delay damages in the amount of $3,140,236.99 in accordance with Pennsylvania Rule of Civil Procedure 238.*fn1 (Id.) Judgment was then entered as follows:
on the molded verdict in favor of the Plaintiff, Elissa L. Young, and against the Defendants, Norman Zitomer, M.D., Mohammad (Ahmer) Kashif, M.D., Allegheny University Hospitals — Hahneman [sic] Division, Allegheny United Hospitals, Inc., and Allegheny Health, Education and Research Foundation, jointly and severally, in the sum of $24,210,236.99 and against the Defendant, Norman Zitomer, M.D., to the extent of sixty (60%) percent of the causal liability apportioned by the jury in the sum of $14,526,142.19.
(Id.) On July 11, 2001, Wright filed a Petition to Reduce Security for Purposes of Appeal, asking the court to reduce the amount of security that had to be paid into the court for the appeal to act as a supersedeas pursuant to Pennsylvania Rule of Appellate Procedure 1731(a). (Defs.' Ex. F.) The Petition stated that MedPro would "pay its share of the verdict, $200,000, plus its proportionate share of delay damages . . . or $32,791.00, into Court pending the appeal." (Id. ¶ 11.) On August 14, 2002, Wright filed a motion seeking permission to pay into court the policy limits of the Policy ($200,000) and MedPro's proportionate share of delay damages and post-judgment interest as calculated by MedPro ($42,970.00). (Defs.' Ex. G.)

  This action was filed in the Philadelphia County Court of Common Pleas on September 30, 2002 and Young was named as one of the Defendants. On March 13, 2003, Young settled her malpractice action against the defendants in Young v. Zitomer in return for the payment of $551,435.00, the promise of payment of $2,501,790.00 from the Medical Care Availability and Reduction of Error Fund (the "MCARE Fund"), and the assignment of Zitomer's rights against MedPro. (Defs.' Ex. I.) Young executed a "Limited Release" pursuant to which she agreed not to satisfy any part of the judgment in Young v. Zitomer against the personal assets of any of the defendants to that action, released the MCARE Fund of any further obligation, retained her right to proceed against the estate of the PHICO Insurance Company pursuant to a previously filed proof of claim, and preserved her right to proceed in this action against MedPro "and to file and proceed with any other claim defendant Zitomer may have against said insurance company." (Id.) Defendants subsequently moved to realign Young as a Plaintiff in this action. That motion was granted and Defendants removed to this Court on June 13, 2003.

  II. LEGAL STANDARD

  Summary judgment is appropriate "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). An issue is "genuine" if the evidence is such that a reasonable jury could return a verdict for the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A factual dispute is "material" if it might affect the outcome of the case under governing law. Id.

  A party seeking summary judgment always bears the initial responsibility for informing the district court of the basis for its motion and identifying those portions of the record that it believes demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). Where the non-moving party bears the burden of proof on a particular issue at trial, the movant's initial Celotex burden can be met simply by "pointing out to the district court that there is an absence of evidence to support the non-moving party's case." Id. at 325. After the moving party has met its initial burden, "the adverse party's response, by affidavits or otherwise as provided in this rule, must set forth specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(e). That is, summary judgment is appropriate if the non-moving party fails to rebut by making a factual showing "sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex, 477 U.S. at 322. The Court must view the evidence presented on the motion in the light most favorable to the opposing party. Anderson, 477 U.S. at 255. However, "[s]peculation, conclusory allegations, and mere denials are insufficient to raise genuine issues of material fact." Boykins v. Lucent Technologies, Inc., 78 F. Supp.2d 402, 407 (E.D. Pa. 2000). Indeed, evidence introduced to defeat or support a motion for summary judgment must be capable of being admissible at trial. Callahan v. AEV, Inc., 182 F.3d 237, 252 n. 11 (3d Cir. 1999) (citing Petruzzi's IGA Supermarkets, Inc. v. Darling-Delaware Co., 998 F.2d 1224, 1234 n. 9 (3d Cir. 1993)). "Where, as here, cross-motions for summary judgment have been presented, we must consider each party's motion individually. Each side bears the burden of establishing a lack of genuine issues of material fact." Reinert v. Giorgio Foods, Inc., 15 F. Supp.2d 589, 593-94 (E.D. Pa. 1998). III. DISCUSSION

  The Second Amended Complaint asserts causes of action for declaratory judgment (Count I), breach of contract (Count II) and indemnification (Count III). The Second Amended Complaint demands, in connection with each Count, a declaration that Defendants are "responsible for paying the full measure of delay damages (prejudgment interest) and post-judgment interest presently owed to Ellisa Young under Pennsylvania law. . . ." (2d Am. Compl. at 10, 12, 14.)

  A. Joint and Several Liability

  Plaintiffs have moved for summary judgment on Counts I and II on the grounds that MedPro is obligated under the Policy to pay all of the delay damages awarded in Young v. Zitomer and all of the post-judgment interest which has accrued on the judgment in that case because Zitomer is jointly and severally liable for the entire amount of the judgment. Defendants have moved for summary judgment on Counts I and II on the grounds that MedPro cannot be held jointly and severally liable for delay damages and post-judgment interest.

  On July 29, 2002, judgment was entered jointly and severally against Zitomer, and the other Young v. Zitomer defendants, on the molded verdict of $24,210,236.99, which includes delay damages in the amount of $3,410,236.99. (Defs.' Ex. I.) The Pennsylvania Supreme Court has held that delay damages can be awarded against tortfeasors jointly and severally: we hold that as a general precept Rule 238 damages awarded against all defendants in a negligence action are properly aggregated with the verdict such that the defendants are jointly and severally liable for the aggregated delay damages. The fact that delay damages under Rule 238 may be calculated in the first instance on an individualized basis before being aggregated with the general liability verdict does not alter the analysis.

 Allen v. Mellinger, 784 A.2d 762, 766 (Pa. 2001); see also, Tindal v. Southeastern Pennsylvania Transportation Authority, 560 A.2d 183, 189 (Pa. Super. 1989) (en banc) ("Liability normally follows verdict. Therefore, appellants are jointly and severally responsible for the entire amount of delay ...


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