Lack of Personal Jurisdiction Still a Valid Defense For Out-Of-State Medical Providers

 

Key Points:

  • In order for a plaintiff to sue an out-of-state medical provider in a Pennsylvania court, the out-of-state medical provider must fall under the personal jurisdiction of the Pennsylvania courts.
  • For an out-of-state health care provider, negligent acts committed in the foreign state cause harm in that foreign state, even if that harm is ultimately discovered in Pennsylvania.
  • Pennsylvania will not exert personal jurisdiction over an out-of-state medical provider defendant unless that defendant actively seeks to treat Pennsylvania residents or provides treatment in Pennsylvania.

 

In April Mendel v. Robert Ocasio, M.D., and Underwood Hospital, et al., 2012 Pa. Super. LEXIS 2060 (Pa. Super., August 20, 2012), April Mendel filed suit against multiple medical providers in the Court of Common Pleas, Philadelphia County, Pennsylvania, including a hospital, physician group and her treating physician affiliated with Einstein Medical Center (the Pennsylvania defendants), as well as Robert Ocasio, M.D. and Underwood Hospital (the New Jersey defendants). In her complaint, Mendel alleged that the New Jersey defendants failed to diagnose and treat her lumbar spine abscess and failed to properly notify the Pennsylvania defendants of her deteriorating medical condition, causing her paralysis from the waist down. The New Jersey defendants filed preliminary objections to Mendel's complaint, alleging lack of personal jurisdiction in Pennsylvania. The trial court granted the preliminary objections, thereby dismissing the plaintiff's case against the New Jersey defendants. Mendel immediately appealed, with the key issue being whether Pennsylvania had either general or specific personal jurisdiction over the New Jersey defendants.

General jurisdiction over an out-of-state corporation is authorized by 42 Pa.C.S.A. §5301(a) if that corporation carries on a "continuous and systematic part of its general business within [Pennsylvania]." An out-of-state corporation can be held to fall under the general jurisdiction of Pennsylvania if it has "the minimum business activity necessary to establish general jurisdiction under the Due Process Clause." A forum state that establishes general jurisdiction over an out-of-state defendant "may adjudicate both matters that originate within the State and those based on activities and events elsewhere."

Mendel argued that "continuous and systematic" contacts were present by way of Underwood's business associations with Thomas Jefferson University Hospital (Jefferson), located in Philadelphia, Pennsylvania, including the use of the Jefferson logo, representations to the public that it was a member of the Jefferson Health System and the presence of contracts with Jefferson. The Superior Court disagreed, noting that Underwood did not operate a substantial portion of its business in Pennsylvania, did not maintain any real property in Pennsylvania, had no offices in Pennsylvania and did not provide any services in Pennsylvania. The contracts between Underwood and Jefferson were not sufficient to establish "continuous and systematic" contacts in Pennsylvania because the contracts did not call for any business activity in Pennsylvania. Underwood's use of the Jefferson logo similarly did not qualify as sufficient activity in Pennsylvania to establish general jurisdiction. Consequently, general jurisdiction over Underwood was not established.

Nevertheless, the Superior Court still had to determine whether Pennsylvania possessed specific personal jurisdiction over the New Jersey defendants. A forum state will be able to establish specific jurisdiction over an out-of-state defendant if there is a specific act or occurrence which occurs in the forum state, thus subjecting that out-of-state defendant to that forum state's jurisdiction. Therefore, "because due process may permit specific jurisdiction based solely on 'single or occasional' acts purposefully directed at the forum, it is narrow in scope, limiting a cause of action to the extent that it 'arises out of or relates to' the very activity that establishes jurisdiction."

A two-part analysis must be conducted to determine whether an out-of-state defendant should be brought into the forum state based on specific jurisdiction. First, "the plaintiff must demonstrate that the defendant purposefully established minimum contacts with the forum state," and second, "the maintenance of the suit must not offend 'traditional notions of fair play and substantial justice.'" "Minimum contacts" is established when the out-of-state defendant has contacts with the forum state:

[s]uch that the defendant could reasonably anticipate being called to defend itself in the forum…. the defendant must have purposefully directed its activities to the forum and conducted itself in a manner indicating that it has availed itself of the forum's privileges and benefits such that it should be subjected to the forum state's laws and regulations.

 

If "minimum contacts" is established, then a case-by-case analysis is done to determine whether it is reasonable and fair to bring that out-of-state defendant into the forum state.

Mendel's argument as to whether Pennsylvania should have been able to assert specific jurisdiction over the New Jersey defendants was based upon § 5322(a)(4) of the Long Arm Statute, which provides as follows:

(a) General rule. A tribunal of this Commonwealth may exercise personal jurisdiction over a person…who acts directly or by an agent, as to a cause of action or other matter arising from such person:

                                 (4) Causing harm or tortious injury in this Commonwealth by an act or omission outside this Commonwealth.

 

42 Pa.C.S.A. § 5322(a)(4). Mendel argued that Underwood and Dr. Ocasio caused harm to her in Pennsylvania by failing to diagnose and treat her spinal cord injury in New Jersey and by failing to provide her Pennsylvania physicians a report of her medical condition.

The Superior Court disagreed and ruled against the plaintiff, holding that the negligence of the New Jersey defendants took place in New Jersey, as did the harm, and that this harm merely continued in Pennsylvania, where is was ultimately discovered. The Superior Court held that the failure to inform "evidenced only a continuation of a single course of negligent conduct that originated in New Jersey; namely, Underwood and Doctor Ocasio's failure to diagnose and treat Mendel's condition" and was not a distinct omission which occurred in New Jersey, but which only caused harm in Pennsylvania.

The Superior Court also held that the New Jersey defendants did not have sufficient minimum contacts under the Due Process Clause to uphold specific personal jurisdiction. Neither Underwood, nor Dr. Ocasio, engaged in any systematic or continuing effort to provide services in Pennsylvania, such as by promoting or marketing their practice nationally; soliciting Mendel as a patient; or purposely treating patients in Pennsylvania. Neither defendant maintained contact with Mendel after her transfer and did not direct any of her care in Pennsylvania. Mendel's argument that Underwood and Dr. Ocasio did have sufficient minimum contacts with Pennsylvania to support specific personal jurisdiction based upon their affiliations with certain medical organizations, associations with Jefferson and personal travel to Philadelphia was rejected by the Superior Court because none of those activities were related to the injuries Mendel was alleged to have suffered. Therefore, they could not be used to uphold personal, specific jurisdiction over Underwood and Dr. Ocasio.           

Finally, the Superior Court, while acknowledging the public policy argument that allowing the plaintiff to bring suit against the New Jersey defendants in Pennsylvania would promote judicial economy and would not be a major inconvenience to the parties, ruled that this public policy argument must be balanced against Pennsylvania's interest in ensuring its residents have access to competent medical treatment in foreign jurisdictions. Therefore, "[l]imiting jurisdiction over out-of-state doctors to circumstances in which the doctors actively sought to treat Pennsylvania patients helps to ensure that Pennsylvania residents will receive adequate medical services wherever they may travel."

*Jason, an associate in our Philadelphia, Pennsylvania, office, can be reached at 215.575.2698 or jwbialker@mdwcg.com.

Defense Digest, Vol. 18, No. 4, December 2012