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The Texas Supreme Court has upheld a $9.5 million punitive damages award in a medical malpractice action, determining that the state’s cap on medical malpractice damages does not apply to punitives. But in the same decision — which is seen by both plaintiffs and defense attorneys as having a wider effect on medical malpractice judgments — the court found that the cap does apply to prejudgment interest on noneconomic damages. The decision came in the appeal of an $11.4 million judgment in a medical malpractice action filed over the treatment of an elderly woman in a nursing home. Although the Texas Supreme Court upheld the award, the full decision will particularly affect judgments for patients who died due to alleged malpractice or who died before trial, said plaintiffs’ attorney Charles W. “Chad” Fillmore of Fort Worth, Tex.’s The Fillmore Law Firm. “The way the court has construed this is that if the patient is still alive, the cap doesn’t apply,” Fillmore said. “If the patient dies, there is a cap. This encourages stalling. There will be risk managers at hospitals and nursing homes telling them” to stall until the patient dies to get the full benefit of the cap. He added, “The whole point of prejudgment interest is to get the parties to the settlement table.” Although prejudgment interest is still applicable to economic damages, most of the damages in cases involving injuries to the elderly or dead are noneconomic, he said, adding, “If defendants are only going to pay what they owed to begin with, there’s no reason to settle early.” Defense attorney Brent Cooper of Dallas’ Cooper & Scully hailed the overall decision as a victory for defendants. “We were obviously disappointed by the ruling on punitives, but we’re very happy the court has extended the cap in general.” The case involved the treatment of Martha Hary at the Heritage Western Hills Nursing Home in Fort Worth, Tex. Hary, then 73, was admitted to the Heritage home in August 1994 suffering from Alzheimer’s disease and other ailments, said Fillmore’s brother and co-counsel, H. Dustin Fillmore III. During her 360-day stay at the nursing home, he said, Hary developed bedsores, which became infected. She was also malnourished and dehydrated, he said. By the time she was released to a local hospital, he added, she was close to death. But, he said, she recovered under hospital care and was released. She died in August 1996 of unrelated causes. Before her death, her sister sued Horizon/CMS Healthcare Corp., the owner of Heritage, alleging that the home had been both negligent and grossly negligent by failing to provide Hary with proper medical care. Auld v. Horizon/CMS Healthcare Corp., 48-165121-96 (Dist. Ct., Tarrant Co., Texas). On Nov. 7, 1997, a Fort Worth jury awarded the estate $2.37 million in compensatories and $90 million in punitives. The punitives were capped at four times compensatories, or $9.48 million. The compensatory judgment totaled $1.54 million, including $221,000 in medical costs and $1.32 million in capped noneconomic damages. The court then added $211,968 in prejudgment interest. Horizon appealed the district court judgment, contending that the plaintiff could not collect punitives or prejudgment interest because this would put the judgment over the statutory cap. The Texas Supreme Court unanimously determined that the state legislature did not intend the medical malpractice cap to apply to punitives. The court, however, ruled 5-4 that the plaintiff “may recover prejudgment interest on damages subject to the cap only up to the amount of the cap.” The ruling means the plaintiff could collect prejudgment interest on the uncapped $221,000 medical care component of the verdict, said Chad Fillmore, but not on the capped amounts for pain, mental anguish and impairment.

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