[August 25, 2011 Update: The Cal Supremes granted a hearing of this case on June 8. Opening brief on the merits is due on September 8.]
There are lots and lots of multi-defendant tort cases in California. And in many of them, some defendants settle without getting a good faith order under Code of Civil Procedure section 877.6, leaving other defendants to go to trial. What if I were to tell you that, when that happens, the first defendant who takes a release wipes out most of the plaintiff's case against the other defendants? I'm going out on a limb here and telling you that's the law.
Work with me here for a minute. This is kind of inside baseball, but for those of you in the tort world, it's worth taking a look at. Our case for today is called Leung v. Verdugo Hills Hospital (March 23, 2011) ___Cal.App.4th___ (Court of Appeals, 2nd Dist., B204908).
Medical malpractice case v. doctor and hospital. (If you do tort work but not med mal, keep reading anyway -- the med mal part doesn't matter). Catastrophic and tragic injury to newborn. Doctor and plaintiff settle for doctor's $1 million policy, on condition that doctor sits as a defendant at trial. Jury awards $250K in non-economic damages (the maximum under California's med mal reform statutes) and a thumping $15.2 million in economic damages (past and future medical, future lost earnings, etc., everything reduced to present cash value). Jury finds doctor 55% at fault, hospital 40% and parents 5%. But since California is a joint and several state for economic damages, the hospital is on the hook for (a) 40% of the $250K; (b) all of the $15.2M, less (c) about $10,000 from the doctors' settlement (just trust CBL on this -- we'll explain it some other time, and how the math works isn't the point of this case or this post).
Instead, the point is this: The case goes to the Court of Appeals, which takes all of the $15M+ in economic damages away. Why? Because the Plaintiff's release of the doctor for the $1M policy is deemed a release of the hospital.
CBL hears you ask: How did this happen and what does it mean to me? Go the jump, and all will be revealed.