Statute of Limitation Clarified by Court of Appeals – $29.1 Million Upheld in Arroyo v. United States

Just as there is a difference between state laws and federal laws, so is there a difference between medical clinics who receive federal funding and those who don’t. If a medical facility receives federal funding, its staff are considered federal employees and as such are subject to federal laws. This means that if a doctor at a federally-funded clinic commits medical malpractice then the corresponding medical malpractice claim will be handled by a federal court, not a state court.

The Seventh District of the Illinois Appellate Court recently reviewed whether a medical malpractice claim brought against federal employees was filed during the statute of limitations. If a claim is not brought during the appropriate statute of limitations, it is then barred from litigation, i.e., it cannot be filed or proceed to trial. However, the appellate court found that Arroyo v. United States, 10-2311 (7th Cir. 2011), had been brought during the appropriate time frame and therefore the $29.1 million verdict was upheld.

Arroyo was a birth injury lawsuit involving claims that the neonatal staff failed to recognize and treat baby Christian Arroyo’s infection in a timely manner. Christian had contracted a bacterial infection from exposure to his mother’s blood during his May 2003 birth. Generally, pregnant women undergo a variety of blood work tests during the month before their due date. However, because Arroyo was premature, his mother had not yet undergone these tests and therefore doctors were not aware that would have tested positive for Group B Streptococcus (GBS).

Because exposure to GBS can lead to permanent injuries in babies, doctors take several precautions when a mother has not undergone these prenatal tests. Most importantly, the medical staff must be on the lookout for any signs or symptoms of neonatal sepsis, i.e., an infection in the baby’s bloodstream. If there is even a suspicion of neonatal sepsis, the standard of care for treating such infections is to administer antibiotics to begin fighting the suspected infection. If the sepsis is not treated immediately, it can lead to severe brain damage.

This is what happened in Arroyo’s case. Despite signs and symptoms that Arroyo had contracted an infection, his doctors failed to administer antibiotics. As a result, Arroyo suffered from severe and permanent brain injuries, which include spastic quadriplegia, cerebral palsy, seizure disorder, communication deficits, the inability to swallow, incontinence, and permanent pain. It is likely that if Arroyo had received antibiotics in a timely manner that his injuries would have been drastically reduced.

However, the Arroyo family was not immediately aware that Christian Arroyo’s brain damage could have been avoided. It was not until the mother gave birth to her second son in July 2004 that she became aware of the importance of neonatal antibiotics and began to understand that Christian’s permanent brain injuries could have been avoided if not for the doctors’ negligence. The family filed a medical malpractice lawsuit against those doctors a year and a half after becoming aware of the true cause of Christian’s injuries.

The Arroyo’s medical malpractice lawsuit was complicated by the fact that the two doctors named in the suit were not only affiliated with Northwestern Memorial Hospital, but also with Erie Family Health Center, a federally funded health center. Since Erie Center received federal funding, its employees were considered federal employees according to Health Centers Assistance Act, 42 U.S.C. §233(g) – (n). So while the Arroyos filed a medical malpractice lawsuit against Drs. Reddy and Callentine in December 2005, they were protected from liability for any actions that fell under the scope of their medical duties. Therefore, under the Federal Tort Claims Act (FTCA) the United States then assumes liability for any negligence by Drs. Reddy and Callentine.

However, the Arroyo’s state-filed claim was not removed to the federal court until August 2007. The Arroyos had also filed an administrative claim with the United States Department of Health and Human Services (HHS) in April 2006 as required by 28 U.S.C. § 2675. The Code requires anyone filing an action against the United States for an injury arising out of negligence by a government employee to first file a claim with their governing federal agency. In February 2007, the HHS denied both the Arroyo’s original claim and their request for reconsideration. As a result, the only option for collecting damages was their lawsuit against the United States.

That lawsuit went to trial in January 2010, the result of which was a $29.1 million judgement against the United States. However, the trial judge asked both parties to submit post-trial briefs regarding damages and the government’s claim that the Arroyos had not complied with the statute of limitation. After considering the presented arguments, the court issued an opinion that stated that the Arroyos had appropriately filed their claim within the two year statute of limitations.

The United States government appealed this decision to the 7th District of the United States Court of Appeals. In its brief, the United States argued that the district court’s decision should be reversed because (1) the court failed to apply the proper tests for determining when the Arroyos’ FTCA claim accrued; and (2) several of the court’s factual determinations were erroneous.

Typically, the requirements regarding statute of limitations are fairly strict, with a claim being barred if the party fails to notify the appropriate federal agency of that claim within two years from the date that the claim accrues. The court’s prior decision in McCall v. United States, 310 F.3d 984, 987 (7th Cir.2002) specifically addressed the issue of when a claim begins accruing. It held that a claim accrues either when (a) the plaintiff discovers it; or (b) a reasonable person in the plaintiff’s position would have discovered that he has been injured by an act or omission attributable to the government. In addition, the court’s decision in Drazan v. United States, 762 F.2d 56, 59 (7th Cir.1985), set out that a claim against the government begins accruing only when the individual becomes aware that the negligence was “in the government’s control, not a concurrent but independent cause that would not lead anyone to suspect that the government had been responsible for the injury.”

The Act also provides certain exceptions for those plaintiffs who did not notify the federal agency within two years of the claim accruing: (1) a civil lawsuit was filed that contained the relevant claim within the period of the two year statute; and (2) the federal agency was notified of the claim within sixty days of the civil suit’s dismissal.

When considering the Arroyo lawsuit, the court found that the plaintiffs had satisfied these conditions. Their original claim against the defendant doctors was filed in December 2005, which was within two years of the time that the Arroyos first became aware of the medical negligence in July 2004. While the plaintiffs did not file a claim with the HHS until April 2006, it had filed the corresponding civil lawsuit within the appropriate two year statute. Likewise, HHS denied the plaintiff’s claim before the civil lawsuit against the doctors was dismissed and the United States government substituted as defendants. Therefore, the Arroyos had in fact satisfied all of the requirements for filing the birth injury claim within the appropriate two year statute and as such the district court’s $29.1 million award stands.

For more than 35 years, Kreisman Law Offices has been handling Illinois brain injury cases for individuals and families in and around Chicago, Cook County, and surrounding areas, including Joliet, Glen Ellyn, Lombard, and Zion.

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