Avera St. Luke's Hosp. v. Karamali, No. 1:11–CV–01020.

• Decision Date: 24 January 2012
• Docket Number: No. 1:11–CV–01020.
• Parties: AVERA ST. LUKE'S HOSPITAL, Plaintiff, v. Adil M. KARAMALI, M.D., Defendant.
• Court: U.S. District Court — District of South Dakota

848 F.Supp.2d 1017

AVERA ST. LUKE'S HOSPITAL, Plaintiff,

v.Adil M. KARAMALI, M.D., Defendant.

No. 1:11–CV–01020.

United States District Court,

D. South Dakota,

Northern Division.

Jan. 24, 2012.

Reed A. Rasmussen, Siegel, Barnett & Schutz, Aberdeen, SD, for Plaintiff.

Lonnie R. Braun, Thomas Braun Bernard & Burke, LLP, Rapid City, SD, for Defendant.

ORDER AND OPINION

CHARLES B. KORNMANN, District Judge.

Avera St. Luke's Hospital (“Avera”) filed a complaint with South Dakota's Fifth Judicial Circuit on July 15, 2011, seeking indemnity or contribution from Adil M. Karamali, M.D. (“Karamali”) on a theory of implied indemnity based on its allegation that the defendant committed negligent acts or omissions that were the cause of damages incurred by the plaintiff in a prior case, Larry Alexander, M.D. v. Avera St. Luke's and Sanford USD Medical Center, Civ. 09–5294 (2d Cir.Ct.S.D.), settled by Avera's monetary payment—of which Karamali did not contribute.

Defendant served as a locum tenens cardiologist for Avera between March 28 and April 1, 2008, during which time the incident involving Dr. Alexander occurred. Karamali filed a notice of removal with this court, citing diversity jurisdiction under 28 U.S.C. § 1332. Both Avera and Karamali sought and were granted a protective order on the contents of the Alexander lawsuit settlement. Karamali also filed an answer to plaintiff's complaint.

Karamali filed a motion for summary judgment with an accompanying memorandum and a statement of material facts pursuant to D.S.D. Civ. LR 56.1A. Avera filed four documents—a response to Karamali's statement of material facts, a statement of disputed material facts, a memorandum opposing the motion, and an affidavit. Karamali filed a brief in reply.

I. BACKGROUNDA. Standard of Review

Fed.R.Civ.P. 56 requires that this court dismiss all claims for which the movant shows there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law. The movant must support its motion with evidence admissible at trial in order to meet its initial burden showing the absence of a genuine issue of material fact. If the moving party meets its initial burden, the nonmoving party cannot merely rest upon allegations or denials in its pleadings to defeat the motion, Forrest v. Kraft Foods, Inc., 285 F.3d 688, 691 (8th Cir.2002), but must “substantiate his allegations with enough probative evidence to support a finding in his favor” by citing to particular materials in the record which support the assertion that a fact is genuinely disputed, Roeben v. BG Excelsior Ltd. P'ship, 545 F.3d 639, 642 (8th Cir.2008).

The court must view the admissible evidence in a light favorable to the nonmoving party and give that party the benefit of all reasonable inferences drawn from the evidence. Country Life Ins. Co. v. Marks, 592 F.3d 896, 898 (8th Cir.2010). However, the scope of admissible evidence is quite finite: “Only disputes over facts that might affect the outcome of the suit under the governing substantive law will properly preclude the entry of summary judgment.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). “[S]ummary judgment will not lie if the dispute about a material fact is ‘genuine,’ that is, if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Id.

B. Factual Background

The relevant facts in connection with the motion are mostly undisputed. Avera was named as a co-defendant, along with Sanford USD Medical Center, in a prior state court action. The prior plaintiff, Dr. Alexander, claimed that Avera was negligent and exacerbated damage to Dr. Alexander's heart, resulting in pain, suffering, permanent disability, and his need for a heart transplant. Karamali was not named in Dr. Alexander's complaint. Instead, his name first arose in the disclosures of Dr. Alexander's medical expert, who singled out Karamali in his analysis of Dr. Alexander's medical records on the date of the treatment of his myocardial infarction, April 1, 2008—the same date when the alleged negligence occurred. Karamali admits he was still serving as locum tenens cardiologist for the plaintiff on that date.

No claim was brought against defendant by Dr. Alexander within the two year statute of limitations for medical malpractice, SDCL 15–2–14.1, and any claims by Dr. Alexander against Karamali are now barred. Avera settled this prior lawsuit by paying Dr. Alexander. Karamali disputes (1) Avera's mixed factual and legal contention that Karamali's alleged negligence is legally imputed to Avera and (2) that Avera and Karamali were joint tortfeasors for purposes of the Alexander controversy.

II. DECISION

Karamali makes three claims in support of his motion. He asserts that the medical malpractice statute of limitations, constituting a statute of repose, not only prevents patients from filing malpractice claims over two years after the offending treatment and regardless of the time when the malpractice is discovered, but that the statute prevents any third party claims derivative of any malpractice claim from being filed two years after the offending treatment, including claims of indemnity and contribution. Second, he argues that, on the claim of indemnity, there is no vicarious or imputed liability between Avera and himself with regard to Dr. Alexander's claims because Karamali was an independent contractor and because Dr. Alexander claimed Avera was independently negligent, preventing Avera from now claiming only the “passive, vicarious, or imputed liability” necessary to assert indemnity. Finally, on the claim of contribution, Karamali contends that he and Avera are not joint tortfeasors according to South Dakota law, and thus contribution would be improper.

A. SDCL § 15–2–14.1 Does Not Bar Avera's Claims of Indemnity and Contribution

Karamali asserts that the statute of limitations for medical malpractice in South Dakota is a statute of repose—a point that Avera does not deny. Karamali contends that South Dakota case law holds that statutes of repose can cut off longer statutes of limitations on claims of indemnity and contribution. Karamali cites to three other state jurisdictions as persuasive authority—Georgia, Illinois, and South Carolina—where statutes of repose were used by courts to dismiss medical malpractice indemnity or contribution claims.

1. SDCL § 15–2–14.1 Does Not Cut Off the Statute of Limitations on Claims of Indemnity or Contribution

The right to contribution is codified in South Dakota law. SDCL 15–8–12. Similarly,the right of indemnity is enshrined in state law. See Ebert v. Fort Pierre Moose Lodge No. 1813, 312 N.W.2d 119, 122–23 (S.D.1981); see generally SDCL 56–3. Since both remedies are creatures of statute, both fall into the catch-all six-year statute of limitations. SDCL 15–2–13(2). Karamali argues that if a statute of repose applies to the primary claims of Dr. Alexander underlying the claims of indemnity and contribution, that statute of repose trumps the six-year period. Adopting this construction in this case would require granting defendant's summary judgment motion.

Karamali relies upon Sheehan v. Morris Irrigation, Inc. (Sheehan III), 460 N.W.2d 413 (S.D.1990), for the proposition that South Dakota courts recognize statutes of repose as categorically cutting off claims of indemnity. This case arose out of a contract to provide center-pivot irrigation systems to a South Dakota ranch. An irrigation dealer partnered with an irrigation system design firm to assemble the system and contracted with a manufacturer to build components. Soon after installation, the end guns on the pivots began to malfunction. The irrigation system design firm sued, seeking indemnification from the irrigation manufacturer. The S.D. Supreme Court affirmed the trial court's grant of summary judgment for the manufacturer based upon a “strict application view” of U.C.C. § 2–725, the statute of limitations applicable to contracts for the sale of goods—in this case, sprinkler equipment. Sheehan III, 460 N.W.2d at 416. The Court held the statute of repose barred the indemnity claim.

While Karamali's recitation of Sheehan's facts is accurate, his legal analysis is not. The Supreme Court is clear about the selective nature of its holding in Sheehan, restricting its scope to the facts of the case. See id. at 418 (“We therefore hold that, in this case, the trial court, although not so stating, correctly applied the strict application view.” (emphasis added)). Further evidence of this is shown by the Court's willingness to analyze and apply the holding of a representative case adhering to the more relaxed view, specifically the Nebraska Supreme Court's ruling in Wood River v. Geer–Melkus Constr. Co., 233 Neb. 179, 444 N.W.2d 305 (1989). The relaxed view's first premise is that implied indemnity rests on principles of equity and should be used to prevent unjust enrichment. Sheehan III, 460 N.W.2d at 417 (citing Wood River, 444 N.W.2d at 310).Sheehan, instead of arguing against the merits of the Wood River holding as it would in adopting the strict view as the final standard, used an equity analysis to determine that no equitable case could be made for the Sheehan plaintiff. See Sheehan III, 460 N.W.2d at 417. The plaintiff in Sheehan sought indemnity alone, an “all or nothing” proposition that required the plaintiff to prove it was free of any wrongdoing. Id. In order for the Sheehan plaintiff to succeed in its claim of indemnity, it would have had to show that there was a genuine issue of material fact that its negligence did not contribute at all to the harm alleged in the primary case. See id. at 415, 417. With such little space spent on the application of the relaxed view, it is understandable to contend Sheehan was a wholesale endorsement of the strict view.

The ruling in Sheehan has two important implications here. First, the Court's...