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Meningitis Case Prompts VCPA, Punitives Claims

In plaintiff’s suit for the wrongful death of her husband from fungal meningitis allegedly resulting from an epidural injection of a contaminated steroid produced by a compounding pharmacy and used by defendant health care providers, a Roanoke City Circuit Court says plaintiff has stated claims for negligence, gross negligence, negligence per se, punitive damages and violation of the Virginia Consumer Protection Act, but her fraud claim is not sufficiently specific and is dismissed with leave to amend.

Plaintiff filed this wrongful death action on Dec. 27, 2012, alleging her husband died of fungal meningitis caused by an epidural injection of a contaminated steroid. According to the complaint, New England Compounding Pharmacy Inc. (NECC), a nonparty to this suit, produced the steroid. The complaint describes the NECC-produced steroid as a “knock-off” version of Depo-Medrol, which is Pfizer’s brand name of methylprednisolone acetate. This lawsuit is one of several meningitis cases brought against defendants in this court alleging injuries caused by NECC-produced drugs.

Plaintiff alleges IHC procured and provided the contaminated steroid, Dr. O’Brien injected decedent with the drug at a facility known as Insight Imaging-Roanoke, Dr. Mathis was the facility’s medical director and IHC owned, operated and controlled the facility.

The complaint alleges Insight Imaging-Roanoke is Image Guided Pain Management (IGPM) PC’s registered trade name, and IHC also transacts business in Virginia as Insight Imaging-Roanoke. Plaintiff alleges Dr. Mathis and Dr. O’Brien were employees and/or agents of both IHC and IGPM. Plaintiff alleges defendants IHC, IGPM, O’Brien and Mathis knew or should have known the epidural steroid injection was dangerous for several reasons. First, NECC was an unaccredited compounding pharmacy and its drugs and production processes were unsanitary, unsterile and lacked adequate quality-control measures. In addition, defendants purchased over 600 batches of methylprednisolone acetate from NECC in two months, even though bulk production of the product by compounding pharmacies is “very risky” and illegal. Finally, plaintiff alleges the risk of contamination was even greater because NECC produced the drug without preservatives. Plaintiff asserts the following claims against all defendants: negligence per se, violation of the Virginia Consumer Protection Act, negligence, gross negligence and fraud.

The court denies IHC’s demurrers arguing that NECC is an indispensable party and IHC is exempt from Virginia’s Drug Control Act that plaintiff alleges supports the negligence per se claim. To find that the Act holds only pharmacists liable would be an unreasonably restrictive interpretation that contradicts the plain, obvious and rational meaning of the statute. The fact that pharmacists must perform a “final check” on the drugs they compound under Va. Code § 54.1-3410.2 does not relieve IHC or any other party of the responsibility to refrain from engaging in the acts prohibited by Code § 54.1-3457.

The court also denies the IHC and IGPM defendants’ demurrers to plaintiff’s VCPA claim. IHC is a statutory supplier under the VCPA and the consumer protection statute applies to the aspect of the transaction at issue. The VCPA claim hinges on defendants’ representations to decedent regarding the treatment he received. None of the statutes or regulations invoked by defendants authorize a relevant aspect of the transaction in this case. Hence, Va. Code § 59.1-199’s exclusion does not apply.

Also, “actual” damages available under the Virginia Consumer Protection Act include emotional distress damages. Two circuit courts have ruled that under the VCPA, actual damages means iiieconomiciii damages. Reversing course, one of those courts later took the position that “actual damages” as used in the VCPA is not limited to out-of-pocket pecuniary losses. This court finds the reasoning of that later decision persuasive and presumes that in the absence of limiting language, the General Assembly intended no unusual restriction on the term “actual damages” as used in the VCPA.

The court further holds plaintiff has stated a prima facie case for negligence and has sufficiently alleged gross negligence.

However, plaintiff has failed to plead fraud with specificity. A plaintiff fails to state a claim for fraud against a business organization where the plaintiff does not reveal the identities of the organization’s agents, officers and employees who are alleged to have perpetrated the fraud, or the details of the time and place where the fraud occurred. The fraud claim in its current form is too vague, indefinite and conclusory. The demurrers are sustained, with leave to amend.

The court denies the demurrers to plaintiff’s claim for punitive damages. Plaintiff has sufficiently alleged that IHC committed negligence so willful or wanton as to evince a conscious disregard of the rights of others.

The court grants plaintiff’s motion for partial summary judgment on the limit of damages applicable to IHC under the Virginia Medical Malpractice Act. In responses to requests for admission, IHC admitted it was not a health care provider under Va. Code § 8.01-581.1. IHC later made an about-face and requested to amend its admissions. IHC now claims it is a statutory health care provider entitled to the Act’s damages cap. Because IHC’s motion to amend does not satisfy the first requirement of Rule 4:11(b), to show that upholding the admissions would practically eliminate any presentation of the merits of the case, the court denies IHC’s motion for partial summary judgment.

Wingate v. Insight Health Corp. (Dorsey) No. CL 12002547-00, Oct. 31, 2013; Roanoke City Cir.Ct.; J. Scott Sexton, Christopher E. Hassell, John T. Jessee for the parties. VLW 013-8-122, 25 pp.

VLW 013-8-122

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