March 5, 2020
In two landmark decisions issued within the past week, the Tennessee Supreme Court has upheld the constitutionality of two statutes having great impact on Tennessee defendant health care providers. First, the Court answered the much-anticipated question of whether the state statutory cap on noneconomic damages ($750,000 per Tennessee Code Section 29-39-102) violates the state constitution by holding it does not. Secondly, the Court upheld the constitutionality of the Tennessee Health Care Liability Act, as elided (i.e., amended), and removed a portion relating to ex parte communications with non-party treating health care providers.
$750,000 LIMIT IS CONSTITITIONAL AND DOES NOT VIOLATE A PLAINTIFF’S RIGHT TO TRIAL BY JURY
McClay v. Airport Management Services, LLC[1] came to Tennessee’s high court on certified questions from the United States District Court for the Middle District of Tennessee. The underlying personal injury case sought damages for injuries sustained at the Nashville International Airport in August 2016. After a jury returned a verdict of $444,500 in future medical expenses and $930,000 in noneconomic damages (for pain and suffering, permanent injury, and loss of enjoyment of life), the defendant moved to reduce the verdict consistent with the statutory cap found in Section 29-39-102. This cap generally limits noneconomic damages to $750,000. The plaintiff argued the cap was unconstitutional and therefore unenforceable. The Tennessee Supreme Court did not agree.
The Court explained that the cap is not inconsistent with Article 1, Section 6, of the Tennessee Constitution, which guarantees a right of trial by jury. The Court reasoned that the right to a jury trial requires all contested factual issues be decided by an unbiased and impartial jury, but that the Tennessee Constitution does not entitle a plaintiff to any specific cause of action or particular remedy. The Court explained that the causes of action and the available remedies are matters of law subject to determination by the state legislature. The Court held that a plaintiff’s constitutional rights are not violated when the judge applies, as a matter of law, the statutory cap following a jury award in excess of $750,000. The Court further clarified that the cap does not violate the separation of powers doctrine and does not violate the state constitution’s equal protection clause.
CAP REMAINS VALID AND ENFORCEABLE
The statutory cap remains valid and enforceable moving forward. The cap was put in place a little under a decade ago as part of the Tennessee Civil Justice Act of 2011, in the name of tort reform. The cap limits total recoverable non-economic damages suffered by each plaintiff (including derivative claims of a spouse or child) to $750,000. In cases with multiple defendants, the total amount recovered may not exceed $750,000, but the damages are apportioned based on the percentage of fault the jury assigns for each defendant (as long as the plaintiff’s fault is not equal to or greater than fifty percent, in which case recovery is barred). The limit on damages increases to $1,000,000 if the injury is “catastrophic,” which is statutorily defined. The cap does not apply if the defendant had a specific intent to inflict serious physical injury, if the defendant intentionally falsified material evidence with the purpose of evading liability, if the defendant was under the influence of drugs or alcohol resulting in substantially impaired judgment, or if the defendant’s act resulted in the conviction of a felony. The cap is not disclosed to a jury but is instead applied by the trial court to any jury verdict awarding noneconomic damages. Constitutional challenges to the cap on noneconomic damages have been alleged since the 2011 enactment.
The opinion was not unanimous. Two of the five justices opined that the statutory cap violates the right to a jury trial. Justice Cornelia Clark reasoned the cap usurps the jury’s constitutionally protected function of determining both the type and amount of damages. Justice Sharon Lee argued that the cap renders a jury’s verdict for noneconomic damages meaningless.
The case provides some certainty for defendants and insurers across Tennessee.[2] While this cap is not specific to medical malpractice cases, it applies to all personal injury, including medical malpractice and health care liability cases, originating on or after October 1, 2011.
AS ELIDED, STATUTE PERMITTING EX PARTE COMMUNICATIONS IN HEALTH CARE LIABILITY ACTIONS IS CONSTITUTIONAL
Just two days after the McClay decision, the Tennessee Supreme Court disapproved of statutory language requiring trial courts to allow defendants to meet ex parte with a Plaintiff’s health care providers, but upheld the constitutionality of the statute after removing a phrase that, in the opinion of the Court, violated the separation of powers clause.[3] As enacted, Section 29-26-121(f) provided that a trial court shall issue a qualified protective order allowing defendants in a health care liability action to interview non-party treating health care providers, outside the presence of the patient’s attorney, when the defendants’ petition satisfied certain conditions. The purpose of this provision was to place plaintiffs and defendants on the same footing by ensuring a defendant’s informal access to a treating health care provider. The Court held that by removing any discretion from the trial court in the decision to grant protective orders, this Section “impermissibly intruded” on the judiciary’s inherent authority over procedural matters. The state high court concluded the General Assembly overstepped its bounds in violation of the Tennessee Constitution’s separation of powers clause. Despite this violation, the Court relied upon the doctrine of elision and determined the objectionable portion of the statute may be removed to preserve the constitutional remainder. The Court removed the language requiring the trial court to grant a petition for a qualified protective order. The elided statute that survives this decision allows defendants in health care liability actions to petition trial courts for qualified protective orders permitting private interviews with treating health care providers but vests the trial court with discretion in ruling on such motions.
For more information regarding either decision or about anticipating or managing Tennessee health care liability claims, please contact one of our Tennessee Medical Malpractice Defense attorneys.
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[1] McClay v. Airport Mgmt. Servs., LLC, No. M2019-00511-SC-R23-CV (Tenn. Feb. 26, 2020).
[2] The constitutionality of Tennessee’s cap on punitive damages is not formally settled. In 2018, the United States Court of Appeals for the Sixth Circuit held that the statutory cap on punitive damages violated the right to a jury trial. Lindenberg v. Jackson Nat’l Life Ins. Co., 912 F.3d 348 (6th Cir. 2018). In its McClay decision, the state high court acknowledged it is not bound by decisions of a federal circuit court of appeals and stated it was not persuaded by the reasoning of the Lindenberg majority opinion.
[3] Willeford v. Klepper, No. M2016-01491-SC-R11-CV (Tenn. Feb. 28, 2020).
