Law Feature -- April 2001
By Walt Borges
Physicians who are targets of medical liability lawsuits
currently find themselves between a rock and a hard place with only
two options: fight or settle. But if State Rep. Juan Hinojosa is
successful in passing a Texas Medical Association-backed bill,
doctors will have a third way of responding to frivolous and
In a bill filed Feb. 8, Representative Hinojosa seeks to give
doctors, hospitals, and other health care professionals the ability
to recover damages from patients and their lawyers who act in bad
faith to file or pursue medical liability suits without a
legitimate legal basis. The bill is not designed to suppress
lawsuits by patients and lawyers who go to court to recover for
injuries resulting from malpractice or negligence by health care
professionals. Instead, it is designed to make lawyers and their
clients pay when they maliciously file or pursue unwarranted suits,
damaging the reputations of the physicians and hospitals that are
"The physicians of the Texas Medical Association support
Representative Hinojosa's efforts to address this growing problem
and will work with him to achieve a balance that deters lawsuit
abuse without compromising the ability of patients to pursue
legitimate legal actions," said TMA President Jim Rohack, MD. "It
is only fair that patients be made whole if they have been injured.
Likewise, it is only fair that unjustly sued doctors be able to
restore their good reputation and regain the trust of their
But it's not just the reputations of physicians, hospitals, and
health care professionals that prompted Representative Hinojosa to
file the bill.
"As a representative of the people, I am looking at implications
much bigger than a doctor's reputation," Representative Hinojosa
said in announcing the bill. "I want to preserve access to health
The McAllen Democrat, a lawyer, says abusive lawsuits drive
physicians from areas where they face a high risk of lawsuits to
other communities where legal action is less likely. Abusive
lawsuits in the Rio Grande Valley, already identified as an
underserved area for medical care, will drive out the targeted
physicians, and the resulting rise in premiums for medical
liability insurance will prompt other doctors to leave as well.
Harold Freeman, TMA's associate director of legislative affairs,
says the new bad faith cause of action is needed because
traditional sanctions against lawyers and clients who recklessly
disregard whether they have a basis for a medical liability suit
are not used. Judges are hesitant to use such sanctions, and the
sanctions that can be imposed are limited, Mr. Freeman says.
Sometimes, the situation is complicated by the fact that the
support of the legal community is needed in the judge's next
Mr. Freeman says TMA is not aware of any instance in the last
year of lawyers being sanctioned for filing frivolous lawsuits
through the State Bar of Texas, which runs the lawyer disciplinary
system. As of press time, the association was working with the
State Bar to search and analyze disciplinary records relating to
frivolous lawsuits in response to an open records request filed by
Valley of the besieged
The need for legislation was prompted partially by an
unprecedented set of lawsuits that are being pursued in the Rio
Grande Valley against a physician and hospital in McAllen.
In 1999, a class action suit covering as many as 2,000 claimants
was filed against McAllen cardiovascular surgeon Francisco
Bracamontes, MD, and the McAllen Medical Center. It alleged that
the defendants had represented to patients that Dr. Bracamontes,
who received his medical education and served his residency in
Mexico, was board certified. Although Dr. Bracamontes had trained
and practiced under Denton Cooley, MD, and other leading heart
surgeons at the Texas Heart Institute in Houston, he was ineligible
for board qualification in the United States because he did his
residency in Mexico.
The class action lawsuit was filed on behalf of all the patients
treated by Dr. Bracamontes at the McAllen Medical Center between
1993 and 1999. The lead attorney for the plaintiffs, Michael
Caddell, JD, of Houston, successfully sought a temporary
restraining order blocking Dr. Bracamontes from performing surgery.
The plaintiffs' lawyers argued that because the doctor was not
board certified in cardiovascular surgery, he was not eligible to
perform the surgery, even though this is not the case. The
restraining order later was dissolved.
Dr. Bracamontes subsequently faced at least 30 lawsuits alleging
medical malpractice filed by two law firms. About half the suits
have been dismissed or withdrawn because the plaintiff failed to
show a legitimate cause of action.
A second set of lawsuits involving approximately 235 plaintiffs
was filed by the law firm of Ramon Garcia. The defendants were the
McAllen Medical Center; Dr. Bracamontes' office mate,
cardiovascular surgeon Lester Dykes, MD; and Hector M. Urrutia, MD,
a cardiologist who referred patients to Dr. Bracamontes. The suits
alleged that the defendants misrepresented Dr. Bracamontes' board
certification and made negligent referrals to Dr. Bracamontes. Dr.
Bracamontes was not named in these suits.
The impact of both suits on Dr. Bracamontes' practice was
severe. He could not perform surgery while the restraining order
was in effect. Until recently, physicians would not take call for
him because they were afraid they would be sued. Dr. Bracamontes
had to be available at all times for his patients, preventing him
from vacationing or traveling overnight. And after Dr. Urrutia was
sued for allegedly making a negligent referral to Dr. Bracamontes,
many physicians stopped making referrals to Dr. Bracamontes.
A rising tide
The Rio Grande Valley is not the only area where the rising tide
of medical liability suits threatens to engulf the medical
community, TMA officials say.
A TMA study completed in July 2000 shows that the statewide
number of medical liability claims and lawsuits rose from 2,596 in
1997 to 3,656 in 1999, the highest number in at least six years.
Other studies show that 82 percent of the medical liability claims
and lawsuits were closed without a payment to the claimant in 1999,
suggesting that many of the filed cases are discovered to be
baseless at some point in the legal process.
Mr. Freeman says the problem with medical liability suits
doesn't just surface in the Rio Grande Valley counties. "The
problem ripples into other parts of the state as some carriers put
Harris County and adjacent counties into the same territory as the
Valley," Mr. Freeman explained, linking the claims experience of
the Valley doctors to that of doctors in the larger area and
driving up liability insurance rates throughout the South Texas and
Gulf Coast area.
The affordability of insurance in the Valley is reaching a
critical stage, says Mr. Freeman, threatening the availability of
medical liability insurance. Physicians from the Valley have
requested that the Texas Department of Insurance review the
situation, Mr. Freeman says.
Tom Cotten, president of the
(TMLT), reports that tort reform efforts culminating in 1995
resulted in a temporary reduction of the number of medical
liability claims, but the numbers have returned to the 1995 levels
in the past year.
"We are at the same place we were in 1995," said Mr. Cotten, who
said that more lawsuits and the higher costs of defending and
settling them have created a medical liability insurance
He says TMLT premiums for its 10,000 policyholders have risen an
average of 50 percent in the past 18 months.
Choosing to fight a medical liability suit means the physician
will spend weeks and maybe months in court away from his or her
practice, suffering through a very public dispute that will
tarnish, if not destroy, his or her reputation. Choosing to settle
is not much better. While the physician's insurer often will absorb
the immediate financial costs of the settlement, a physician's
willingness to settle implies he or she did something wrong and the
settlement undermines his or her reputation among colleagues.
"There are no meaningful sanctions against those who file
malicious suits," said Dr. Rohack. "Although the State Bar of Texas
and the courts have the ability to impose penalties against bad
lawyers, those remedies are rarely used."
On paper, there are several remedies for physicians who have
seen reputations and practices destroyed by unwarranted medical
liability suits. A physician can challenge the patient and his
attorney in the courtroom by filing suit for malicious prosecution,
abuse of process, or defamation. Or the doctor can ask a judge to
impose sanctions under the judge's authority to regulate legal
procedure and behavior, and seek either financial penalties or the
striking of certain plaintiffs' pleadings. A third option is to use
the lawyer discipline system, a process that punishes the attorney
but which does not compensate the victims of lawyer
TMA lawyers and lobbyists say all three strategies are likely to
The causes of action against lawyers and patients face
substantial legal hurdles, TMA lawyers point out. Defamation of a
physician does not occur in a legal sense in court filings, and
doctors can sue plaintiffs and their attorneys only when they have
been defamed outside of court proceedings and filings. To prove
malicious prosecution allegations in Texas requires the target of
the original lawsuit to show that the plaintiff has deprived the
defendant of his or her liberty or property. That requirement is
met only rarely in civil cases, Mr. Freeman says.
Abuse of prosecution is even harder to prove. A doctor who
attempted to use the abuse-of-process cause of action in Houston a
few years ago ended up having his suit dismissed by the judge. An
appeals court upheld the dismissal and said that even when suits
are brought maliciously and in bad faith, it is not abuse of the
litigation process. Representative Hinojosa's bill would create a
separate cause of action that is not subject to that
interpretation, Mr. Freeman points out.
The lawyer disciplinary process is limited as well, says Mr.
Freeman. Complaints about unscrupulous lawyers go through a local
grievance committee and then are sent on through a complex
administrative process. Even if the complainant wins a public
reprimand or a more serious sanction, the process is not intended
to compensate lawyers' victims for their losses.
Sanctions can be imposed under the Texas Rules of Civil
Procedure, but they are rarely used. Mr. Freeman says judges
hesitate to do anything that would chill the right under the Texas
Constitution to take disputes to court, and they tend to err on the
side of inaction despite their ability to level fines and strike
court documents of offending lawyers and their clients. Many feel
that dismissal of the lawsuit is remedy enough. And trial court
judges, who are elected in Texas, also must weigh the impact of
their sanctions on lawyers whose support will be needed during the
A sanction was leveled against Mr. Caddell, the plaintiff's
lawyer in the suit in McAllen, and his law firm. On Jan. 24, Judge
Leticia Hinojosa (no relation to the state representative), of the
139th District, ordered the Houston law firm of Chapman and Caddell
to pay the attorneys' fees for the defendants in a suit filed
against Tawhid Shuaib, MD, and other doctors on behalf of heart
patient Richard Trevino. Mr. Trevino said he had not approved a
suit against Dr. Shuaib, his primary care physician. Mr. Caddell's
firm, which has dropped the case against Dr. Shuaib, says it will
appeal the sanction.
Focus on bad faith
The Hinojosa bill attempts to give doctors, hospitals, and
health professionals a chance to fight back against bad faith
lawsuits. To sue independently or countersue as part of a medical
liability suit, the physician must show that the plaintiff and his
or her attorney filed or maintained the suit with reckless
disregard as to whether reasonable grounds existed for suing the
Mr. Freeman says the new cause of action is not designed to
allow doctors or their defense lawyers to use the bad faith suits
to undermine legitimate medical malpractice suits or to make it
easier to settle. "We are going after the attorneys who had no
reason to file and pursue a case in the first place," Mr. Freeman
In fact, only physicians, hospitals, and other health care
professionals who provide treatment to patients can sue. Insurers
are not allowed to seek bad faith judgments against the opposing
lawyers and patients, and it is doubtful that insurers can be
required to pay for the bad faith suit as part of their duty to
provide a defense for a covered physician.
Austin attorney David M. Davis, JD, immediate past president of
the Texas Association of Defense Counsel, says he can see several
drawbacks in the legislation.
First, Mr. Davis says, rulemaking is better undertaken by the
Texas Supreme Court than by the Texas Legislature because the court
deals with litigation.
Second, some defense lawyers fear the legislature will turn the
Hinojosa bill "topsy-turvy on its head," he said. Instead of
passing a law that allows physicians to recover damages for
unsubstantiated lawsuits, the legislature could rewrite the bill so
that defendant physicians and their lawyers are subject to being
sued for frivolously defending suits.
A third problem, Mr. Davis suggests, is that the frivolous suit
problem in medical liability cases is less a statewide problem than
a regional problem in the Rio Grande Valley. Mr. Davis says that in
the northern parts of the state, "we don't see cases that are
frivolous, and when we do, we get rid of them through existing
rules. We just don't seem to have this problem statewide, although
the issues raised by Representative Hinojosa are certainly
significant to the Valley and show clear need for an appropriate
Mr. Cotten, the TMLT president, says that while TMLT supports
the concept of aggressively pursuing tort reforms efforts, he
agrees with Mr. Davis' evaluation of the pitfalls facing the
Judges also appear skeptical of the sanctions. A survey of state
judges by the Civil Practices Committee of the Texas House of
Representatives found that sanctions for frivolous lawsuits were
requested in 37 percent of the courts responding to the survey.
Sanctions were granted by only 18 percent of the courts. And only
11 percent of the responding judges said they needed additional
authority to be able to impose effective sanctions to "deter the
filing of a frivolous lawsuit, motion, or pleading."
Austin lawyer Tommy Jacks, JD, former president of the Texas
Trial Lawyers Association, says that while there are occasional
instances in which judges fail to use the available legal tools to
deter frivolous suits, efforts to provide a legislative fix should
proceed with caution.
"When the plaintiff loses, it doesn't mean it was a frivolous
case or one that should never have seen the inside of the
courthouse," Mr. Jacks noted, adding that it is important to make
sure the bad faith cause of action can't be used to intimidate
patients who have legitimate injuries and their lawyers.
Mr. Freeman points out that although both the patient and his
lawyer can be targeted in the new bad faith suit, it inevitably
will be the lawyer who pays when the doctor wins. Most patients, he
notes, cannot afford the cost of a lawsuit that involves extensive
scientific evidence and numerous expert witnesses, so they sign
contingent fee contracts that allow their lawyers to fund the case
and be paid from whatever damages are awarded. Most damages will
come out of the pockets of the plaintiff's lawyer, Mr. Freeman
If the bill becomes law, physicians who use the bad faith cause
of action improperly to intimidate injured patients could
themselves be sued for bad faith, and a judgment against the
physician would not be covered by a liability insurer. The damages
for the losing physician would come out of the doctor's pocket, Mr.