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Tuesday, Jan. 5, 2010 | 9:15 a.m.
Related Document
Dr. Dipak Desai, the majority owner of the Endoscopy Center of Southern Nevada, leaves a hearing at Las Vegas City Hall on March 3, 2008.
Related stories
- Thoroughness, not haste, key in probe of clinic’s insurance billing practices (1-2-2009)
- Report shows how Dipak Desai put profits ahead of safe practices (12-22-2009)
- Report on Las Vegas Hepatitis C outbreak released (12-21-2009)
- Targeting insurers’ deep pockets (12-18-2009)
- Police ask DA to seek criminal neglect charges against Desai (11-19-2009)
- Police probe of clinic cases in hepatitis outbreak nears end (11-16-2009)
- Bankruptcy trustee: Leave the hepatitis claims to us (11-13-2009)
- Regulation in need of a checkup (10-25-2009)
Sun Coverage
Attorneys in the Endoscopy Center of Southern Nevada bankruptcy case are battling over whether an insurance company should be allowed to settle 18 of the thousands of lawsuits filed by patients who were exposed to hepatitis C because of irregular procedures at the Las Vegas clinic.
Attorneys for clinic co-owner Dr. Dipak Desai and the bankruptcy case's trustee, Brian Shapiro, are fighting the settlement plan by Nevada Mutual Insurance Co., saying the settlements in just 18 of the cases would likely exhaust the available insurance proceeds from Nevada Mutual and leave other patients short-changed.
"These 18 cases are the tip of a massive litigation iceberg involving to date hundreds of lawsuits involving potentially thousands of plaintiffs arising out of the same series of events," attorneys for Desai said in court papers filed Thursday.
"It is clear what Nevada Mutual's strategy is here. It wants to settle a few of the hundreds of lawsuits, exhaust policy limits in that manner and then declare it has no further obligation to defend the remaining lawsuits," Desai's filing said. "It clearly has no interest in the consequences of its action on the thousands of claimants who may be denied compensation, even though claimants in some of the unsettled cases may have more meritorious claims than the settling plaintiffs. Both federal and state law make it clear that such an inequitable course of action should not be permitted."
Attorneys for Desai, Rodney Jean and Todd Kennedy of the Las Vegas law firm Lionel Sawyer & Collins, also complained Nevada Mutual has failed to disclose the terms of the 18 proposed settlements and hasn't addressed the number of lawsuits and plaintiffs in the lawsuits in which its insureds are named as defendants.
"Despite this lack of information, it is safe to say that there are hundreds of lawsuits, which could involve thousands of plaintiffs, brought by former patients of the debtors (the Endoscopy Center and related companies) against the debtors, Dr. Desai, and a variety of other defendants, many of whom are insured by Nevada Mutual," the attorneys' filing said.
Desai believes $30 million in coverage is available under the Nevada Mutual policy, though that amount is in dispute.
With an estimated 5,000 patients suing Desai and his clinics, charging they were either infected with hepatitis or lived in fear of being infected, the $30 million is likely to fall short of covering their claims.
Instead of paying lawsuit verdicts and settlements in a manner that is fair to all the patients with confirmed claims, Desai's attorneys claim Nevada Mutual "proposes to compensate plaintiffs solely on the basis of a combination race to the courthouse and race to the insurance proceeds."
"The bankruptcy court, by contrast, is well-suited to establish just such an equitable procedure," Desai's attorneys said.
Attorneys for Shapiro, the appointed trustee in the Endoscopy Center's Chapter 7 liquidation, added in a court filing Monday: "If you are Nevada Mutual Insurance Co., the quickest way out of this bankruptcy, the hepatitis litigation and all the other contractual obligations undertaken by virtue of its insurance contract with the debtors and their co-insureds is to exhaust the policy's limits of liability and leave the debtors to fend for themselves in the remaining mass tort cases."
Shapiro's attorneys called Nevada Mutual's strategy "a textbook bad faith insurance practice."
But attorneys for Nevada Mutual said in their Nov. 25 request to settle the suits that according to the terms of the policy, Nevada Mutual has the exclusive right to reach settlements "and allocate payments as it deems appropriate."
Nevada Mutual said the settlements involve non-debtor doctors and other professionals who were associated with the clinics but are not technically part of the Endoscopy Center bankruptcy case.
"Nevada Mutual submits that the settlement proceeds for the proposed settlements are not property of the (bankruptcy) estate," Nevada Mutual's filing said.
"The policy plainly provides that the debtors in these (bankruptcy) cases have absolutely no right to the proceeds," the insurance company's filing said, adding if the insurance proceeds became part of the bankruptcy case they would be used to pay costs not associated with patient injuries.
Those costs include bankruptcy administration costs as well as the costs of non-patient creditors.
"None of those persons or entities have any rights whatsoever under the terms of the policy," the insurance company's filing said.
Bankruptcy Judge Mike Nakagawa has set a Jan. 15 hearing on Nevada Mutual's request to settle the 18 lawsuits.
A December report from the Southern Nevada Health District on the hepatitis C outbreak associated with Desai's clinics found nine cases of hepatitis C were genetically linked to the Endoscopy Center and 106 more were possibly linked to the clinic, which passed along infection by reusing syringes and single-use medicine vials.
The outbreak prompted health officials in February 2008 to urge about 50,000 patients to be tested for hepatitis B, hepatitis C and HIV.
hey district attorney david roger...
what the hell are you doing about this???
anything???
are you lazy???
are you in over your head???
are you incompetent???
whatever the reason...
one thing is perfectly clear...
district attorney david roger is a clown...
district attorney david roger is a failure...
district attorney david roger must never hold political office again!!!
hey attorney general catherine cortez masto...
what the hell are you doing about this???
anything???
are you lazy???
are you in over your head???
are you incompetent???
whatever the reason...
one thing is perfectly clear...
attorney general catherine cortez masto is a clown...
attorney general catherine cortez masto is a failure...
attorney general catherine cortez masto must never hold political office again!!!
do you think desai, carrol and carrera will get some golf in today???
what are the maggots on the medical board up to these days???
think they are woking on some more emergency regulations that will protect the turf of the money grubbing whore doctors???
is the medical board the biggest nest of maggots in the state of nevada???
Another great example of our wonderful medical system at work, AGAINST US!!!
@Birdie?!?@#?
Excuse me, sir...you really wrote this in a public forum "...money grubbing whore doctors...", in addition to the other libelous, defamatory comments.
If the Sun does not remove your post for a violation of tortuous behavior, they will also be liable for any consequences. A quick subpoena will reveal your identity, not that some of us don't already know it.
Your rants are irrelevant, immature and violate the comments policy and basic laws against defamatory, hate speech.
Stop 'dreamin', start thinkin', and stop posting this stuff. You have been warned -- again.
Thank you to The Sun for enlightening us about the fact that Lionel Sawyer & Collins, the law firm in which Democrat Candidate for Nevada Governor Rory J. Reid, Esq. is a shareholder/owner, is now representing Dr. Dipak Desai. See:
http://www.lionelsawyer.com/index.cfm?pa...
It's refreshing to see such honesty on the part of a political candidate, who will publicly acknowledge that he is willing to profit from the payment of high dollar legal fees by scum like Dr. Desai. Every ill-gotten dollar of those legal fees going into the pockets of Lionel Sawyer & Collins are dollars that could instead be going into the pockets of the sick and dying victims of Dr. Desai's malpractice. Lionel Sawyer & Collins willingness to take Dr. Desai as a client, and/or Rory J. Reid's failure to resign from that law firm if Dr. Desai became a client, speaks volumes about Rory J. Reid's lack of character and forcefulness.
Mayor Oscar Goodman, the former mob lawyer, was the only public official in town who had the chutzpah to simply shut down Dr. Desai's clinics.
Clark County Commission Chairman Rory J. Reid just dithered and prevaricated, just like he always does.
Perhaps Lionel Sawyer & Collins' and its law partner Mr. Reid's willingness to take Dr. Desai's money is just another little reason why Oscar rather than Rory is the more worthy candidate for Governor.
I hope that the Republicans are paying attention to this one. It will be a great campaign poster: A photo of Rory J. Reid with "Dr. Desai's Lawyer" beneath his smiling face.
I detest liability insurance companies with a passion, and Nevada Mutual in particular because Dr. Desai was one of its founders.
However, my moral outrage is directed at the Bankruptcy Court judge who presumes to interfere in all of the injured patients' rights to litigate their tort claims against the physicians who operated the Endoscopy Centers.
The Endoscopy Centers were mere assetless shell corporations whose bankruptcy should be dismissed as a fraud on the courts designed only to delay the malpractice litigation for the benefit of the reprehensible physicians who practiced there. In previous news stories, the "Bankruptcy Trustee" for the Endoscopy Center admitted that there no assets in the company to sell to pay his fees.
Nevada Mutual is absolutely right: "The settlement proceeds for the proposed settlements are not property of the (bankruptcy) estate...The policy plainly provides that the debtors in these (bankruptcy) cases have absolutely no right to the proceeds. If the insurance proceeds became part of the bankruptcy case they would be used to pay costs not associated with patient injuries. Those costs include bankruptcy administration costs as well as the costs of non-patient creditors. None of those persons or entities have any rights whatsoever under the terms of the policy"
If you actually READ the Bankruptcy Code, it says that a bankruptcy judge has only two choices with respect to tort claims against a debtor: (1) send them back to state court for trial or (2) refer them to U.S. District Court for trial. Of course, the U.S. District Court judges recoil in horror at the thought they might have to try thousands of personal injury cases. Instead of doing his duty, and sending the cases back to State court, Judge Nakagawa is simply holding the malpractice cases hostage, consistent with his reputation as an unreasonably pro-debtor bankruptcy judge.
Before these bankruptcy shennanigans were filed, the Nevada Eighth District Court judge in charge of these medical malpractice cases made a just and rational decision: That the cases of the sickest plaintiffs would be tried first, and the cases of those who live with the fear of hepatitis transmitted by the negligent doctors, but are not sick yet, would have to wait. That is a fair and just decision.
all U.S. Bankruptcy Court judges are appointed for a limited term, and renewal of their appointments can be refused if the individual judges displease the public or elected officials. As a result, if Bankruptcy Judge Mike Nakagawa does not quickly BUT OUT of the medical malpractice lawsuits, it will be time for the plaintiffs lawyers in Las Vegas and the families of the sickest malpractice victims to organize and begin lobbying Federal officials to make sure Judge Nakagawa's appointment is not renewed.
@CynicalObserver:
It's refreshing to read your very articulate comments. However, to coin an old addage, you assume facts not in evidence; that is, that the doctors are 'negligent' in this instance. That has not been proved and will be extremely difficult to do so. The NURSES administered the IV's...the doctors did not. They never even saw (personally) when or who was doing the IV.
And, as you're probably aware, for those patients waiting for a payday because they were scared and had to have a blood test (for free), they have no damages. Being scared is not a cause for damages. Fear is not a compensable or valid tort...
Now, maybe if you find out it was an intentional tort; i.e. that one of the nurses was disgruntled and injected people with this virus intentionally, it's a whole different matter...as a matter of fact that changes the whole complexion of things now doesn't it? H-m-m-m-m