Arizona Bankruptcy Lawyer Agreed To Handle Arizona Medical Malpractice Case And Suffered The Consequences For His Inexperience And Wrongful Conduct

An Arizona lawyer whose speciality was bankruptcy got involved in representing six creditors in a Chapter 7 bankruptcy case involving an Arizona doctor. Meanwhile, through separate counsel, two of the creditors filed an Arizona medical malpractice lawsuit against the doctor. The Arizona medical malpractice lawyer representing the plaintiffs in that case subsequently died, and the bankruptcy lawyer took over that representation, despite not having any experience in representing plaintiffs in Arizona medical malpractice cases and not associating with an Arizona medical malpractice lawyer who had such experience.

The bankruptcy lawyer allowed the medical malpractice case to lie dormant while he filed in the bankruptcy court a First Amended Complaint to Determine Nondischargeability of Debts on behalf of the the plaintiffs in the medical malpractice case, alleging that the doctor had “committed willful and malicious actions upon Mr. Scharf, eventually resulting in Mr. Scharf’s death,” and that the doctor’s actions constituted “extreme and outrageous behavior.” More specifically, the allegations included the following: (1) Dr. Trabucco knew he lacked sufficient experience and expertise regarding laparoscopic nephrectomy, and that he did not have hospital privileges to perform such a procedure; (2) Dr. Trabucco intentionally misled the Scharfs regarding his experience and expertise regarding laparoscopic nephrectomy; (3) an interoperative complication/injury occurred due to an error by Dr. Trabucco; (4) Dr. Trabucco knew this error had occurred and yet continued the operation without addressing the interoperative complication/injury; (5) following the surgery, Dr. Trabucco hid the fact that an interoperative complication/injury had occurred; (6) although he knew Mr. Scharf was seriously injured and would probably die, Dr. Trabucco did not attempt to remedy the situation, and instead lied to the Scharf family and hospital staff; and (7) Dr. Trabucco interfered with and delayed the subsequent medical transfer of Mr. Scharf, again with the intention of hiding the interoperative complication/injury or other malicious intent.

The bankruptcy lawyer later explained that his basis for making such allegations was that “[u]nder bankruptcy law, negligence is a dischargeable matter of law. We were required to show willful, malicious injury which necessarily involves intentional conduct and kind of extreme and outrageous intentional conduct, and thus, the amended complaint was fashioned as such.” Dr. Trabucco’s medical malpractice defense attorney advised the bankruptcy lawyer after the first hearing following the filing of the First Amended Complaint that (1) “if you accuse someone [of] intentionally causing the death of a patient, you better have evidence to back that up,” (2) the bankruptcy lawyer’s “essential medical theory made no sense,” and (3) the allegations in the First Amended Complaint could adversely affect any existing liability insurance coverage because, “[i]f you accuse a doctor of intentional conduct, the [malpractice] insurance [coverage] goes away.”

The bankruptcy lawyer acknowledged it was “unfair to Dr. Trabucco to make these allegations,” but explained that, in his opinion, “these are the only allegations that I can make, ie. (sic) intentional tort and they would survive a Rule 11 claim” because the surgery had continued well beyond the anticipated two hours and because Dr. Trabucco had “consent to open the [surgical] field and did not,” indicating Dr. Trabucco made a conscious decision not to convert the laparoscopic procedure to an open procedure for which he had pre-operative consent and instead, according to the bankruptcy lawyer, prematurely terminated the surgery.

Dr. Trabucco subsequently filed a complaint against the bankruptcy lawyer and his medical malpractice clients, alleging malicious prosecution, abuse of process, and intentional infliction of emotional distress. The bankruptcy lawyer initially represented only himself in this case but, after being admitted pro hac vice and notwithstanding the apparent conflict of interest, also represented the medical malpractice plaintiffs.

The trial was limited only to the damages caused by the bankruptcy lawyer and the medical malpractice plaintiffs for malicious prosecution and abuse of process. Dr. Trabucco claimed that, as a result of the actions of the bankruptcy lawyer, the two medical malpractice plaintiffs, and others, he lost his medical practice and had been damaged emotionally and financially. The jury awarded $6,232,000 in compensatory damages and $1,768,000 in punitive damages, plus costs, to Dr. Trabucco and against the bankruptcy lawyer, while assessing no damages against the medical malpractice plaintiffs.

Malicious Prosecution

The Arizona Court of Appeals Division One (“Arizona Appellate Court”) stated in its Memorandum Decision dated April 7, 2020 that in order to prove malicious prosecution, a plaintiff must show the defendant (1) instituted a proceeding, (2) motivated by malice, (3) without probable cause, (4) that terminated in the plaintiff’s favor, and (5) damaged the plaintiff.

The Arizona Appellate Court stated that the bankruptcy lawyer admitted his primary motivation in accusing Dr. Trabucco of willfully and maliciously killing his patient was to prevent Dr. Trabucco from obtaining a bankruptcy discharge: “Under bankruptcy law, negligence is a dischargeable matter of law. We were required to show willful, malicious injury which necessarily involves intentional conduct and kind of extreme and outrageous intentional conduct, and thus, the amended complaint was fashioned as such . . . . I had to file this case under a willful and malicious injury under the bankruptcy code as negligence is dischargeable and therefore the amended complaint was fashioned as such, and we made those allegations.”

The Arizona Appellate Court stated that the bankruptcy lawyer’s articulated purpose in filing the First Amended Complaint in bankruptcy court was not to secure the proper adjudication of the claim but rather a legal ploy designed solely to prevent the medical malpractice plaintiffs’ claim from being discharged in the bankruptcy proceedings. “Because [the bankruptcy lawyer] admitted bringing the intentional tort claims for an improper purpose, the superior court did not err in finding Dr. Trabucco had shown the existence of the malice element of malicious prosecution.”

The Arizona Appellate Court also held that as a matter of law, the bankruptcy lawyer had no probable cause for these claims; that the superior court did not err in concluding that bankruptcy adversary proceedings were terminated in Dr. Trabucco’s favor; and, that “the court’s decision to grant partial summary judgment against [the bankruptcy lawyer] on the claim of malicious prosecution was supported by the facts and law, and we affirm that ruling.”

However, the Arizona Appellate Court disagreed with Dr. Trabucco’s argument that the claims of malicious prosecution and abuse of process (and the damages associated with each) arise out of exactly the same facts: “Although many of the facts underlying each tort may be the same, each individual tort relies on separate facts for its basis. Moreover, those separate facts provide not only the basis for an independent cause of action, but also an independent basis for damages, which obviously may vary greatly based on the jury’s view of the actions associated with each tort. Neither the trial on damages, nor the jury’s verdict, nor the resulting judgment identified or distinguished between the damages associated with each tort; after carefully reviewing the entire record of the proceedings and trial presented to us, we cannot, either. Accordingly, the jury’s verdict with respect to [the bankruptcy lawyer] must be vacated and the matter remanded for a new trial as to the damages, if any, arising out of [the bankruptcy lawyer’s] malicious prosecution of Dr. Trabucco in bankruptcy court.”

Source Trabucco v. Cogan, No. 1 CA-CV 18-0526.

If you or a loved one have been injured as a result of medical malpractice in Arizona or in another U.S. state, you should promptly find an Arizona medical malpractice lawyer, or a medical malpractice lawyer in your state, who may investigate your medical malpractice claim for you and represent you or your loved one in a medical malpractice case, if appropriate.

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This entry was posted on Tuesday, May 26th, 2020 at 5:26 am. Both comments and pings are currently closed.

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