Thompson v. THI of New Mexico at Casa Arena, 122408 NMDC, CIV 05-1331

Docket NºCIV 05-1331 JB/LCS
Party NameT. DAVID THOMPSON, Individually and as the Personal Representative of the Estate of CAROLYN ROSE BENNETT, Plaintiff, v. THI OF NEW MEXICO at CASA ARENA d/b/a CASA ARENA BLANCO NURSING HOME, Defendant.
Case DateDecember 24, 2008
CourtUnited States District Courts, 10th Circuit, District of New Mexico

T. DAVID THOMPSON, Individually and as the Personal Representative of the Estate of CAROLYN ROSE BENNETT, Plaintiff,

v.

THI OF NEW MEXICO at CASA ARENA d/b/a CASA ARENA BLANCO NURSING HOME, Defendant.

No. CIV 05-1331 JB/LCS

United States District Court, District of New Mexico

December 24, 2008

Counsel:

T.A. Sandenaw, Jr., CaraLyn Banks, Sandenaw & Anderson, P.C., Attorneys for the Plaintiff

RaMona G. Bootes, Christopher J. DeLara, Guebert Bruckner & Bootes PC, Albuquerque, New Mexico and Timothy L. Fields, Christin M. Heyns, Michael B. Neill, Modrall Sperling Roehl Harris & Sisk, Attorneys for the Defendant

MEMORANDUM OPINION AND ORDER

THIS MATTER comes before the Court on the Plaintiff’s Motion for Rule 60(b) Relief, Motion to Compel Arbitration, or Alternatively Motion for Leave to File Complaint for Wrongful Death, filed March 20, 2008 (Doc. 18)(“Rule 60(b) Motion”). The Court held a hearing on May 14, 2008. The Court previously dismissed this case, ordering the parties to arbitrate their claims. Plaintiff T. David Thompson now seeks to reopen the case to resolve a dispute over the proper parties to the arbitration. The primary issues are: (i) whether Thompson’s request for relief must be categorized as seeking relief from a mistake under rule 60(b)(1) and is thus time-barred; (ii) whether this case presents extraordinary circumstances warranting relief under rule 60(b)(6); and (iii) whether the Court should grant Thompson leave to amend his original complaint against Defendant THI of New Mexico at Casa Arena d/b/a Casa Arena Blanco Nursing Home and add THI of Baltimore as a Defendant. Because the basis of some of Thompson’s requested relief is grounded in litigation mistakes, Thompson’s motion seeks relief in part under rule 60(b)(1) and is untimely. While the remainder of Thompson’s requested rule 60(b) relief relies on post-litigation conduct and may thus be brought under rule 60(b)(6), there are no sufficiently compelling circumstances to justify granting such relief. The Court will therefore not reopen this case. Finally, because Thompson’s alternative request for leave to amend requires the reopening of the case, the Court will deny that alternative request for substantially the same reasons it denies Thompson’s rule 60(b) request. Accordingly, the Court will deny the Rule 60(b) Motion.

FACTUAL BACKGROUND

This case arises as a result of the death of Carolyn Rose Bennett, a patient at the Casa Arena nursing home. Thompson, her husband, placed Bennett in Casa Arena’s care because she had developed early dementia. See Amended Complaint for Wrongful Death, Per Se Negligence for Violation of Federal and State Laws Governing Nursing Facilities, Breach of Fiduciary Duty, Negligence and Breach of Contract ¶ 9, at 3, filed January 9, 2006 (Doc. 2)(“Amended Complaint”). Bennett allegedly died after she fell and sustained a hip fracture during a grand mal seizure on the morning of January 17, 2005, see id. ¶ 30, at 6, about a week after her routine Ativan doses had been halted, see id. ¶ 27, at 5. Thompson, contending that Casa Arena was responsible for Bennett’s demise, brought a wrongful-death action. The present motion, however, turns not on the circumstances of Bennett’s unfortunate death, but on the contract Thompson signed, and on the relationship between Casa Arena and THI of Baltimore.

1. The Execution of the Admission Contract.

In placing Bennett under Casa Arena’s care, Thompson was required to sign an Admission Contract. See Exhibit F to Rule 60(b) Motion, Admission Contract (dated February 9, 2004)(Doc. 18-3). The Admission Contract had three parties: (i) “Casa Arena Blanca, a corporation . . . (‘the Health Care Center’)”; (ii) “Carolyn Bennett (‘Patient/Resident’)”; and (iii) “David Thompson (‘Fiduciary Party’).” Id. at 1. The names Casa Arena Blanca, Carolyn Bennett, and David Thompson were handwritten in blanks on the contract, and the remaining language following the names was typed. Thompson, as Fiduciary Party, and Dayna Grammar, as “Health Care Center Representative,” signed the Admission Contract. Id. at 6.

The Admission Contract contained a number of clauses, including, as relevant here, a broadly worded arbitration clause that provided:

Pursuant to the Federal Arbitration Act, any action, dispute, claim or controversy of any kind (e.g., whether a contract or in tort, statutory or common law, legal or equitable, or otherwise) now existing or hereinafter arising between the parties in any way arising out of, pertaining to or in connection with the provision of healthcare services, any agreement between the parties, the provision of any other goods or services by the Health Care Center or other transactions, contracts or agreements of any kind whatsoever, any past, present or future incidents, omissions, acts, errors, practices, or occurrences causing injury to either party whereby the other party or its agents, employees or representatives may be liable, in whole or in part, or any aspect of the past, present, or future relationships between the parties shall be resolved by binding arbitration administered by the National Health Lawyers Association (the “NHLA”).

Admission Contract at 5. The Admission Contract also had an addendum that dealt with insurance and payment issues. See Exhibit F to Rule 60(b) Motion, Admission Contract Addendum (dated February 9, 2004)(Doc. 18-3)(“Addendum”). In the Addendum, Casa Arena is identified as a “Trans Health corporation (hereinafter the ‘Health Care Center’).” Id. at 1. Trans Health is handwritten in a blank space and the language following that name is typed.

THI of Baltimore provided Casa Arena with the admissions contracts that it used. See Exhibit G to Rule 60(b) Motion, Deposition of T.J. Hicks at 50:4-9 (taken November 15, 2007)(Doc. 18-3)(“Hicks Depo.”). T.J. Hicks, Casa Arena’s administrator at the time, kept a book of contracts in his office, but only looked at the contracts if “told to pull a contract and send it to somebody.” Id. at 59:14-15. From the context, Hicks might be talking about pharmacy services agreements, and not necessarily about admissions contracts.

2. The Relationship Between Casa Arena and THI of Baltimore.

According to Hicks’ deposition testimony, THI of Baltimore exercised a substantial degree of control over its subsidiary, Casa Arena. THI of Baltimore recruited Hicks, and THI of Baltimore’s regional director Jaime Andujo hired him. See id. at 24:1-25:4. Although Hicks could not remember what the name on his paycheck was, he considered Andujo to be his boss. See id. at 44:12-21. Hicks was, however, responsible for the overall operations of Casa Arena. See id. at 31:12-24.

THI of Baltimore officials conducted meetings in New Mexico with staff at Casa Arena and other facilities. The meetings included discussions of reporting requirements for incidents at nursing homes under Department of Health regulations, and about the setting of financial and clinical goals. See id. at 34:18-36:20. THI of Baltimore provided policy and procedures manuals to Casa Arena, although Hicks was unaware of who developed them. See id. at 37:4-18. THI of Baltimore also established incentives for Casa Arena’s Director of Nursing and its administrator. See id. at 39:5-19.

THI of Baltimore prepared the annual budget and long-term strategic plan for Casa Arena. See id. at 47:13-25, 48:18-24. Casa Arena provided detailed financial and clinical reports to THI of Baltimore on a monthly basis. See id. at 41:11-42:8. While Casa Arena’s finance department handled some of the business functions, Casa Arena’s department also relied on THI of Baltimore’s assistance. See id. at 44:22-45:15. Hicks was unaware whether THI of Baltimore was providing revenue subsidization for Casa Arena. Hicks believed it had never been needed, but if it happened, it would have been a “corporate kind of thing” that he would not have been involved in. Id. at 46:21.

Like the other nursing homes that THI of Baltimore owns and operates, Casa Arena is insured through a single insurance policy that THI of Baltimore purchased. See Exhibit H to Rule 60(b) Motion, Schedule of Locations Endorsement at 2 (effective August 30, 2004)(Doc. 18-3). Casa Arena’s mailing address, principal address outside of New Mexico, registered agent, and organizers are identical to those of THI of Baltimore and THI of New Mexico. See Exhibit I to Rule 60(b) Motion, New Mexico Public Regulatory Commission Corporation Information for Casa Arena, THI of New Mexico, and THI of Baltimore (dated March 17, 2008)(“Corporate Registration”).

PROCEDURAL BACKGROUND

Thompson originally filed a wrongful-death action against Casa Arena on December 21, 2005, alleging that Casa Arena’s negligence and contractual breaches caused the death of his wife, Bennett. See Complaint for Wrongful Death, Per Se Negligence for Violation of Federal and State Laws Governing Nursing Facilities, Breach of Fiduciary Duty, Negligence and Breach of Contract ¶¶ 38-75, at 8-18, filed December 21, 2005 (Doc. 1). Thompson filed an Amended Complaint shortly thereafter, which did not make any significant substantive changes. When Thompson filed his first two Complaints against Casa Arena, he was unaware that THI of Baltimore might employ at least some staff at Casa Arena and that THI of Baltimore’s exercise of control over Casa Arena might make THI of Baltimore the alter ego of its subsidiary. In his Amended Complaint, Thompson’s allegations against Casa Arena were based on its role as the employer of the “employees, administrator[s], agents, servants, representatives, officers, directors, designees, nurses, nurses’ aides, pharmacists and/or contractors who were acting within the course and scope of their employment.” Amended Complaint ¶ 6, at 2.

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