Third Circuit: NJ Charitable Immunity Act Protects U.S. in Med-Mal Litigation

In a case of first impression, the Third Circuit Court of Appeals says the federal government enjoys the same protection of state charitable immunity law that applies to volunteer doctors who are deemed to be U.S. Department of Health and Human Services employees. As such, the government is entitled to assert immunity in a suit brought under the Federal Tort Claims Act by the estate of a woman who died from cancer complications after being treated by volunteer doctors, the court ruled on Dec. 30 in Lomando v. U.S., No. 11-1957.

The court said its precedential opinion appears to be the first to address the effect of a Public Health Service Act provision that brought such doctors within the scope of the Federal Torts Claim Act (FTCA), thereby precluding a malpractice suit against them individually and making a suit against the U.S. the exclusive remedy.

Multiple Providers Miss Cues

Ines Lomando brought the suit on behalf of the estate of her daughter, Laura, who died in 2006 after several visits to Parker Family Health Center in Red Bank, NJ, about an enlarged gland on the left side of her neck. Laura also was treated for the enlarged gland and other issues in the emergency room of Riverview Medical Center, also in Red Bank. She was admitted Sept. 20, 2006, and died the next day, of complications related to non-Hodgkins lymphoma. The professionals who treated her there were not protected by the FTCA. Lomando's suit named all the doctors, the clinic, the hospital and the federal government.

The Ruling

On Feb. 23, 2011, District Judge Freda Wolfson in Trenton, NJ, granted Parker Health's motion for summary judgment based on the New Jersey Charitable Immunity Act. A month later, she granted summary judgment dismissing Riverview, the named doctors and the government. She held that the FTCA allows the government to assert any immunity “which otherwise would have been available to the employee of the United States whose act or omission gave rise to the claim.” Because the New Jersey charity statute protected Parker Health and its volunteer doctors, so too was the government entitled to that protection.

Appeals Court Agrees

Lomando appealed. In her claims against the government, she argued that Wolfson ruled incorrectly because the Parker Health doctors' status as federal “employees” rather than “volunteers” blocked NJCIA immunity, and because affording the federal government a state statutory immunity created a constitutional conflict of law. Third Circuit Judge Morton Greenberg, joined by Chief Circuit Judge Theodore McKee and Circuit Judge Julio Fuentes, affirmed Wolfson's release of the federal government from suit.

The FTCA provides that the government can be liable to the extent that a private individual may be, but does not indicate whether the government also would share the same level of liability as a private employer under the same circumstances, the court noted. In answering that question, the U.S. Supreme Court, the Third Circuit and other circuits have found that the government may be held liable under the FTCA to the extent the private employer would be liable, the court said. In this case, that private employer would be a free, nonprofit clinic immunized by NJCIA, whose protections thus must be extended to the federal government, the court continued.

The court pointed to the Westfall Act, which in 1988 provided absolute immunity to government employees for negligent and wrongful acts within the scope of employment, making suit against the government under the FTCA the only remedy in such cases. That legislation also amended the FTCA, entitling the government to assert “any defense based upon judicial or legislative immunity which otherwise would have been available to the employee … whose act or omission gave rise to the claim, as well as any other defenses to which the United States in entitled.”

Later, the Public Health Service Act, at 42 U.S.C. 233(o), was amended to allow the Department of Health and Human Services to deem volunteer physicians in free clinics to be Public Health Service employees.

The court dispensed with Lomando's argument that though the Parker Health volunteers would be immune from suit in state court, they should lose their volunteer status, for purposes of governmental liability, because of their “employee” classification under federal law, and that application of NJCIA immunity violates the U.S. Constitution's Supremacy Clause by conflicting with the objectives of federal law.

“To the contrary, the employee designation is a legal construct effective only for the purposes” of conferring immunity to the individuals, Greenberg wrote. And application of the NJCIA does not conflict with the FTCA's objective of allowing financial recovery for tort victims because the FTCA contains the language extending individual immunities to the government, Greenberg wrote.

In addition, lawmakers explicitly stated at the time that the 1996 amendment including volunteer doctors as “employees” did nothing to pre-empt state laws limiting liability against volunteers, he noted.

David Gialanella is a reporter with the New Jersey Law Journal, an ALM sister publication of this newsletter, in which this article also appeared.

In a case of first impression, the Third Circuit Court of Appeals says the federal government enjoys the same protection of state charitable immunity law that applies to volunteer doctors who are deemed to be U.S. Department of Health and Human Services employees. As such, the government is entitled to assert immunity in a suit brought under the Federal Tort Claims Act by the estate of a woman who died from cancer complications after being treated by volunteer doctors, the court ruled on Dec. 30 in Lomando v. U.S., No. 11-1957.

The court said its precedential opinion appears to be the first to address the effect of a Public Health Service Act provision that brought such doctors within the scope of the Federal Torts Claim Act (FTCA), thereby precluding a malpractice suit against them individually and making a suit against the U.S. the exclusive remedy.

Multiple Providers Miss Cues

Ines Lomando brought the suit on behalf of the estate of her daughter, Laura, who died in 2006 after several visits to Parker Family Health Center in Red Bank, NJ, about an enlarged gland on the left side of her neck. Laura also was treated for the enlarged gland and other issues in the emergency room of Riverview Medical Center, also in Red Bank. She was admitted Sept. 20, 2006, and died the next day, of complications related to non-Hodgkins lymphoma. The professionals who treated her there were not protected by the FTCA. Lomando's suit named all the doctors, the clinic, the hospital and the federal government.

The Ruling

On Feb. 23, 2011, District Judge Freda Wolfson in Trenton, NJ, granted Parker Health's motion for summary judgment based on the New Jersey Charitable Immunity Act. A month later, she granted summary judgment dismissing Riverview, the named doctors and the government. She held that the FTCA allows the government to assert any immunity “which otherwise would have been available to the employee of the United States whose act or omission gave rise to the claim.” Because the New Jersey charity statute protected Parker Health and its volunteer doctors, so too was the government entitled to that protection.

Appeals Court Agrees

Lomando appealed. In her claims against the government, she argued that Wolfson ruled incorrectly because the Parker Health doctors' status as federal “employees” rather than “volunteers” blocked NJCIA immunity, and because affording the federal government a state statutory immunity created a constitutional conflict of law. Third Circuit Judge Morton Greenberg, joined by Chief Circuit Judge Theodore McKee and Circuit Judge Julio Fuentes, affirmed Wolfson's release of the federal government from suit.

The FTCA provides that the government can be liable to the extent that a private individual may be, but does not indicate whether the government also would share the same level of liability as a private employer under the same circumstances, the court noted. In answering that question, the U.S. Supreme Court, the Third Circuit and other circuits have found that the government may be held liable under the FTCA to the extent the private employer would be liable, the court said. In this case, that private employer would be a free, nonprofit clinic immunized by NJCIA, whose protections thus must be extended to the federal government, the court continued.

The court pointed to the Westfall Act, which in 1988 provided absolute immunity to government employees for negligent and wrongful acts within the scope of employment, making suit against the government under the FTCA the only remedy in such cases. That legislation also amended the FTCA, entitling the government to assert “any defense based upon judicial or legislative immunity which otherwise would have been available to the employee … whose act or omission gave rise to the claim, as well as any other defenses to which the United States in entitled.”

Later, the Public Health Service Act, at 42 U.S.C. 233(o), was amended to allow the Department of Health and Human Services to deem volunteer physicians in free clinics to be Public Health Service employees.

The court dispensed with Lomando's argument that though the Parker Health volunteers would be immune from suit in state court, they should lose their volunteer status, for purposes of governmental liability, because of their “employee” classification under federal law, and that application of NJCIA immunity violates the U.S. Constitution's Supremacy Clause by conflicting with the objectives of federal law.

“To the contrary, the employee designation is a legal construct effective only for the purposes” of conferring immunity to the individuals, Greenberg wrote. And application of the NJCIA does not conflict with the FTCA's objective of allowing financial recovery for tort victims because the FTCA contains the language extending individual immunities to the government, Greenberg wrote.

In addition, lawmakers explicitly stated at the time that the 1996 amendment including volunteer doctors as “employees” did nothing to pre-empt state laws limiting liability against volunteers, he noted.

David Gialanella is a reporter with the New Jersey Law Journal, an ALM sister publication of this newsletter, in which this article also appeared.