Court Opinion: 10th Circuit Court of Appeals Opinion for July 19

The 10th Circuit Court of Appeals

Editor’s Note: Law Week Colorado edits court opinion summaries for style and, when necessary, length.

LaSala v. Millard, et al.

Dr. John Millard performed cosmetic surgery on Emily LaSala. After a complication ensued, Millard referred her to a second doctor, Dr. Matthew Baker, who performed an additional surgery. LaSala later sued Millard for medical malpractice. In a second amended complaint, she added Baker to her suit, pursuing claims against him and his employer Phillippe A. Capraro, M.D., P.C. for breach of fiduciary duty, invasion of privacy and civil conspiracy, based on Baker’s sharing of her confidential medical information with Millard. The district court dismissed the claims against the Baker defendants prior to trial. The malpractice claims against Millard proceeded to trial and a jury found in his favor. LaSala appealed the dismissal of her claims against the Baker defendants. 

In March 2017, Millard performed submuscular breast augmentation surgery on LaSala. After the surgery, she experienced discomfort and pain and she was eventually diagnosed with “capsular contracture,” a detachment of her pectoral muscle. Millard referred her to Baker for additional treatment. He performed a second surgery that stretched the atrophied muscle. Baker’s initial view, the opinion noted, was the capsular contracture likely resulted from the surgery.

After LaSala began working with Baker, he communicated with Millard about her treatment and surgery. LaSala argued these communications went beyond the scope of her treatment and devolved into a collaboration between the two doctors about how to help Millard escape malpractice liability, the opinion noted. She also contended Baker betrayed her trust by sharing her confidential medical records, including photographs, with Millard, at a time when she no longer had a treatment relationship with Millard.

After she filed this suit, LaSala filed a “certificate of review” to support her malpractice claim against Millard. Colorado law generally requires a plaintiff to file a certificate of review — an affidavit confirming that counsel has conferred with a qualified expert who believes the relevant legal claims don’t lack substantial justification — to pursue a medical malpractice claim. LaSala’s counsel prepared the certificate of review based on his consultations with Baker. But during Baker’s deposition, which was taken after LaSala added Baker as a defendant, he expressed doubts about whether Millard had been responsible for her injuries.

According to the opinion, LaSala didn’t file a certificate of review to support her claims against the Baker defendants. All defendants moved to dismiss her complaint, arguing she failed to adequately comply with Colorado Revised Statute 13-20-602 for her claims against either doctor. Specifically, the Baker defendants contended LaSala required a certificate of review to pursue her claims against Baker but didn’t file one, and Millard argued her certificate based on counsel’s initial consultation with Baker was defective. The Baker defendants later moved for summary judgment based on the related ground that LaSala didn’t present expert testimony as required to support her claim against Baker.

The district court entered an order that resolved the dispositive motions. It denied Millard’s motions concerning the medical malpractice-related claims but required LaSala to file a new certificate to support those claims. The district court further held LaSala required a certificate of review to pursue her breach-of-fiduciary-duty claim against Baker. Because that claim required expert testimony, and because LaSala failed to file any certificate of review, the court dismissed the claim. It then granted summary judgment to the Baker defendants on the invasion-of-privacy claim, reasoning that disclosure to a single other physician didn’t satisfy the element of public disclosure. Because LaSala’s civil conspiracy claim was predicated on these two claims, the district court dismissed it as well; and because there were no remaining live claims against Baker, the court dismissed the claims against his employer.

The district court later clarified that the breach-of-fiduciary-duty claims and breach of privacy claims against the Baker defendants, and the civil conspiracy claim, had been dismissed with prejudice. The remaining claims against Millard proceeded to trial. A jury rendered a verdict in favor of Millard. The district court then entered final judgment in favor of the defendants, and LaSala appealed.

The 10th Circuit reviewed the district court’s interpretation of the pertinent statute, 13-20-602, de novo. 

LaSala argued because breach of fiduciary duty is an intentional tort, and not a negligence claim, no certificate of review is required. But the Colorado Supreme Court rejected a narrow reading of 13-20-602 in Martinez v. Badis. There the court explained that “[t]he statute applies to all claims based upon alleged professional negligence. It does not apply only to negligence claims.” The Colorado Supreme Court then stated that a breach-of-fiduciary-duty claim against a licensed professional “often requir[es] the plaintiff to establish the identical elements that must be established by a plaintiff in negligence actions,” such as “the applicable standard of care and the defendant’s failure to adhere to that standard of care.” The key, the state high court opinion noted, is whether “expert testimony is required to establish the scope of the professional’s duty or the failure of the professional to reasonably conduct himself or herself in compliance with the responsibilities inherent in the assumption of the duty.” The court concluded 13-20-602 applied to the plaintiffs’ breach-of-fiduciary-duty claims against their erstwhile attorneys. 

LaSala also argued she could call the Baker defendants themselves as experts to “confirm their ethical standards relating to loyalty and confidentiality.” She cited the Colorado Court of Appeals case Smith v. Hoffman, where that court reversed the grant of summary judgment on a malpractice complaint based on the plaintiff’s failure to produce a statement from an expert witness asserting that the defendant’s conduct was negligent. The Colorado Court of Appeals noted that “[b]ecause any qualified expert witness can present evidence with respect to the applicable standard of professional care, [the medical] defendant himself could be called by plaintiff as an adverse witness to present such testimony in this case.” 

According to the 10th Circuit, the district court dismissed the claims against Baker’s employer for two reasons. First, there were no longer live claims against Baker, so LaSala couldn’t predicate corporate liability on such underlying claims. Second, if there were live claims, they would fail because medical corporations can’t be held liable for a doctor’s negligence under a respondeat superior theory. Although LaSala challenged the district court’s second reason for dismissing Grossman Capraro (Operating trade name of Phillippe A. Capraro, M.D., P.C.), she presented no argument concerning the district court’s first reason. The 10th Circuit upheld the dismissal on this alternative, unchallenged ground, the opinion noted citing the 10th Circuit Court of Appeals decision Eaton v. Pacheco.

In a minute order issued over a year after it dismissed the claims against the Baker defendants, the district court stated without explanation the “breach of fiduciary claim against Dr. Baker in this matter was dismissed with prejudice.” A dismissal under 13-20-602 is based on the plaintiff’s procedural failure to file a certificate of review rather than the viability of her claims, the 10th Circuit explained. 

A dismissal with prejudice for failure to adhere to a procedural rule is a severe sanction justified only in extreme circumstances, the opinion noted citing the 10th Circuit Court of Appeals decision Reed v. Bennett. Ultimately, in deciding whether to dismiss a claim with prejudice as a sanction for procedural error “a district court must consider: the degree of actual prejudice to [the opposing party]; the amount of interference with the judicial process; the culpability of the litigant; whether the court warned the party in advance that dismissal of the action would be a likely sanction for noncompliance; and the efficacy of lesser sanctions,” the opinion noted citing the 10th Circuit Court of Appeals decision Nasious v. Two Unknown B.I.C.E. Agents. “Only when these aggravating factors outweigh[ ] the judicial system’s strong predisposition to resolve cases on their merits is outright dismissal with prejudice an appropriate sanction,” according to the Reed decision. 

The 10th Circuit found the district court failed to provide any reasoning for its dismissal with prejudice of the breach-of-fiduciary-duty claim. It affirmed the district court’s dismissal of LaSala’s breach-of-fiduciary-duty claim, but remanded to the district court to redetermine, based on the appropriate factors, whether the dismissal should be with or without prejudice.

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