Westfield Ins. Co. v. Matulis
| Decision Date | 30 September 2019 |
| Docket Number | Civil Action No. 2:17-cv-01269 |
| Citation | 421 F.Supp.3d 331 |
| Court | U.S. District Court — Southern District of West Virginia |
| Parties | WESTFIELD INSURANCE COMPANY, Plaintiff, v. Steven R. MATULIS, M.D.; Charleston Gastroenterology Associates, P.L.L.C.; T.W.; K.H.; T.F.; J.L.; A.G.; B.D.; A.H.; A.M.; C.S.; and J.W., Defendants. |
Brent K. Kesner, Tanya M. Kesner, Kesner & Kesner, Charleston, WV, for Plaintiff.
Benjamin L. Bailey, Bailey & Glasser, Isaac Ralston Forman, Hissam Forman Donovan Ritchie, John A. Kessler, Carey Scott Douglas & Kessler, Adam Campbell, Matthew Smith, Campbell & Smith, C. Benjamin Salango, Preston & Salango, Michael J. Del Giudice, Ciccarello Del Giudice & Lafon, Marvin W. Masters, The Masters Law Firm, David H. Carriger, L. Dante DiTrapano, W. Stuart Calwell, Calwell Luce diTrapano, P. Rodney Jackson, Law Office of P. Rodney Jackson, Cheryl A. Fisher, William M. Tiano, Tiano & O'Dell, James R. Akers, II, Akers Law Offices, Charleston, WV, Philip Gregory Haddad, Bailey & Glasser, Morgantown, WV, Jan Dils, Kelly Little Guice, Jan Dils Attorneys at Law, Parkersburg, WV, for Defendants.
Pending is plaintiff Westfield Insurance Company's ("Westfield") motion for summary judgment, filed November 30, 2017.
Westfield filed this declaratory judgment action on February 14, 2017, pursuant to 28 U.S.C. § 2201 and the West Virginia Uniform Declaratory Judgments Act, W. Va. Code 55-13-1 et seq. See Compl., ECF No. 1 ("Westfield Compl."). The court has diversity jurisdiction over this matter pursuant to 28 U.S.C. § 1332. Defendants Dr. Steven Matulis and his former employer, Charleston Gastroenterology Associates, PLLC ("Charleston Gastroenterology"), have been sued in the Circuit Court of Kanawha County, West Virginia by several former female patients.1 Ten patients are joined here as claimant defendants ("claimants"): T.W., K.H., T.F., J.L., A.G., B.D., A.H., A.M., C.S. and J.W. See id. ¶¶ 4–13, 16. These claimants are identified by their initials for privacy reasons.
The state court lawsuits arise from medical procedures (e.g., colonoscopies ) that Dr. Matulis performed on the claimants while each of them was anesthetized. See id. ¶ 17. The lawsuits allege that Dr. Matulis sexually assaulted the claimants while they were under anesthesia and incapacitated, and/or that Dr. Matulis performed the colonoscopies while distracted or impaired due to his alleged proclivity for sexually assaulting unconscious female patients, such that the colonoscopies were not medically reliable or failed to meet the standard of care owed by a doctor to a patient. See id.
The facts giving rise to each alleged instance of misconduct vary from claimant to claimant. One or more of the claimants allege that an employee or employees of the Charleston Area Medical Center, Memorial Division, where their medical procedures were performed, witnessed the sexual assault by Dr. Matulis. See id. ¶ 18. One or more of the claimants also allege that the employee or employees who witnessed the sexual assault reported the incident to the hospital administration. See id. ¶ 19.
The specific claims against Dr. Matulis include battery, tort of outrage, intentional and negligent infliction of emotional distress, false detention, invasion of privacy, and medical negligence. See, e.g., Pl.'s Mot. Summ. J., ECF No. 113-1 to ECF No. 113-11, Exs. A to K. The claims against Charleston Gastroenterology include negligent and reckless retention, intentional and negligent infliction of emotional distress, negligent supervision, invasion of privacy, and vicarious liability for Dr. Matulis's acts. See, e.g., id. In addition, certain claimants assert class claims on behalf of other female patients of Dr. Matulis who may not know whether they were sexually assaulted or otherwise physically injured during a medical procedure performed by Dr. Matulis. See, e.g., T.F.'s Compl., ECF No. 113-10, Ex. J, ¶¶ 36–49. Several claimants have not yet initiated lawsuits in state court but have filed a "Notice of Claim" to notify Dr. Matulis and Charleston Gastroenterology of a potential medical malpractice suit, as required by West Virginia Code § 55-7B-6(f). See, e.g., Pl.'s Mot. Summ. J., ECF 113-5 to ECF 113-8, Exs. E to H. These Notices of Claim contain similar factual allegations found in the complaints filed in state court.
Westfield provided a general commercial liability insurance policy, Policy Number BOP 3157951 ("the Policy"), to Charleston Gastroenterology for coverage from March 21, 2015 through March 21, 2016. Westfield Compl., at 4–5. All the relevant incidents occurred during the time period of the Policy.2 See id. The Policy provides liability coverage to "pay those sums that the insured becomes legally obligated to pay as damages because of" the following: (1) "bodily injury," (2) "property damage," or (3) "personal and advertising injury." Pl.'s Mot. Summ. J., ECF 113-12, Ex. L ("Policy"), at 71 (Section II.A.1.a). The Policy also provides that Westfield has "the right and duty to defend the insured against any ‘suit’ seeking those damages." Id. The Policy covers both Charleston Gastroenterology and Dr. Matulis as an employee of Charleston Gastroenterology "for acts within the scope of [his] employment by [Charleston Gastroenterology] or while performing duties related to the conduct of [Charleston Gastroenterology's] business." See id. at 82 (Section II.C.2.a).3
The Policy applies to "bodily injury" and "property damage" only if three requirements are satisfied, two of which are particularly pertinent here: (1) the "bodily injury" or "property damage" is "caused by an ‘occurrence’ that takes place in the ‘coverage territory,’ " and (2) the "bodily injury" or "property damage" "occurs during the policy period."4 Id. at 71 (Section II.A.1.b(1). "Bodily injury" is defined as "bodily injury, sickness or disease sustained by a person, including death." Id. at 85 (Section II.F.3). "Occurrence" is defined as "an accident, including continuous or repeated exposure to substantially the same general harmful conditions." Id. at 86 (Section II.F.13). The claimants did not allege property damage claims in the state court lawsuits or the Notices of Claim, so the court does not review further the relevant sections of the Policy on "property damage."
The Policy also covers " ‘personal and advertising injury’ caused by an offense" arising out of Charleston Gastroenterology's business only if the offense was committed in the "coverage territory" during the Policy period. Id. at 72 (Section II.A.1.b(2)). "Personal and advertising injury" is defined as "injury, including consequential ‘bodily injury’ " arising out of one or more enumerated offenses, including, inter alia: "[f]alse arrest, detention or imprisonment," "[o]ral or written publication, in any manner, of material that slanders or libels a person," and "[o]ral or written publication, in any manner, of material that violates a person's right of privacy." See id. at 87 (Section II.F.14) (emphasis added).
The Policy limits coverage based on three relevant exclusions. First, the "Expected or Intended Injury" exclusion applies to " ‘[b]odily injury’ or ‘property damage’ expected or intended from the standpoint of the insured." Id. at 74 (Section II.B.1.a). Second, the "Professional Services" exclusion applies to " ‘[b]odily injury’, ‘property damage’ or ‘personal and advertising injury’ caused by the rendering or failure to render any professional service." Id. at 76 (Section II.B.1.j). "Professional services" include, inter alia, "[m]edical, surgical, dental, X-ray or nursing services treatment, advice or instruction," and "[a]ny health or therapeutic service treatment, advice or instruction." Id. (Section II.B.1.j(4)–(5)). The exclusion notably states that:
This exclusion applies even if the claims allege negligence or other wrongdoing in the supervision, hiring, employment, training or monitoring of others by an insured, if the "occurrence" which caused the "bodily injury" or "property damage", or the offense which caused the "personal and advertising injury", involved the rendering or failure to render of any professional service.
Id. at 78 (Section II.B.1.j) (emphasis added). Third and final, the "Personal and Advertising Injury" exclusion applies, inter alia, to any such injury "[c]aused by or at the direction of the insured with the knowledge that the act would violate the rights of another and would inflict ‘personal and advertising injury.’ " Id. at 79 (Section II.B.1.p(1)). Pursuant to the Policy, Westfield will not pay medical expenses for "bodily injury" excluded from coverage. See id. at 79 (Section II.B.2.g).
Based on the Policy, Westfield filed this case seeking a declaratory judgment that the Policy does not provide coverage for the defense or indemnification of any of the claims asserted by the claimants in state court in connection with the alleged sexual assault and/or the provision of inadequate medical care by Dr. Matulis. See Westfield Compl., at 15. Westfield also asserts that the Policy does not provide coverage for the defense or indemnification of any future related claims that might be filed against Dr. Matulis or Charleston Gastroenterology, including any class actions that may be certified in any of the underlying state civil actions. See id. Finally, based on the lack of coverage, Westfield asserts that it does not have a duty to defend or indemnify Dr. Matulis or Charleston Gastroenterology in the existing state civil actions or in related actions that might be brought. See id. at 16.
Westfield filed the motion for summary judgment and a memorandum of law in support on November 30, 2017. See Pl.'s Mot. Summ. J., ECF 113 ("Motion"); Pl.'s Memo. Supp. Mot. Summ. J., ECF 114 ("Memo"). Four claimants -- J.L., K.H., J.W., and A.G. -- filed opposition briefs between December 14, 2017 and ...
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