Randi A.J. v. Long Island Surgi-Center

OPINION OF THE COURT

Fisher, J.

It is now part of the declared public policy of the State of New York to protect every individual’s right to keep medical treatment private and personal and medical records confidential (see Public Health Law § 2803-c [1], [3] [f]). As a result, when a state-licensed entity breaches that right—and especially when it does so in connection with a particularly sensitive medical procedure—more may be involved than simply a private wrong.

In the case now before us, a 20-year-old unmarried woman who lived with her parents decided to terminate her pregnancy at the defendant, Long Island Surgi-Center (hereinafter the Center). Because her parents strongly disapproved of premarital sex and were implacably opposed to abortion, she was determined to keep her decision from them. Consequently, when she first contacted the clinic to arrange for the procedure, she provided her cell phone number and gave specific instructions never to call her at home. Nevertheless, a day after the abortion, one of the clinic’s nurses telephoned the young woman’s home and spoke with a person she knew to be her mother. In the course of the conversation, the nurse revealed information sufficient to allow the mother to conclude that her daughter had had an abortion.

The core question presented on this appeal is whether, in the young woman’s subsequent action to recover damages, inter alia, for wrongful disclosure of confidential medical information, it was error for the trial court to submit the issue of punitive damages to the jury. We hold that, under the circumstances of this case, it was not.

I

According to the evidence presented at trial, on October 14, 1999, the plaintiff underwent an abortion at the Center. Upon first contacting the Center the day before, she specifically instructed a member of its staff that her home phone number was not to be used and that all calls to her were to be made to her cell phone number, which she provided. The plaintiff lived with her parents who were practicing Roman Catholics, strongly opposed to both premarital sex and abortion, and she did not want them to know about the procedure.

On the plaintiffs preoperative history and patient questionnaire form, which was filled out on October 13, 1999, the plaintiff’s home phone number had been handwritten, then crossed out. The form also listed the plaintiff’s cell phone number, as well as her work number. The nurse who filled out the form did not know why the plaintiffs home phone number had later been crossed out, although she conceded that one possibility was that the plaintiff did not want to be contacted there.

The Center’s administrator testified that, whenever a patient did not wish to be called at a certain number, the proper practice was for the nurse or admitting clerk to cross it out and write “[n]ot to be called or don’t call.” Another nurse, however, testified that the practice was simply to write “do not call, patient’s requesting” or not to write the number down at all. Two other nurses testified that the practice was to write the number down, without crossing it out, preceded by the notation “do not call at” or “do not call this number.” It is undisputed that the Center had no special form to record a patient’s instructions regarding confidentiality and privacy, nor did it have any written plan to protect patient confidentiality. In fact, the Center’s only written “Confidentiality Policy” consisted of a statement that “all medical information that relates to and identifies specific individual patients and practitioners is strictly confidential,” that “all employees . . . are advised of their responsibility to maintain the confientiality [sic] of all patient information,” and that “any breach of confidentiality by an employee may be subject to [sic] termination.”

Moreover, it is undisputed that, upon the plaintiffs admission to the Center, administrative personnel used her insurance information to generate preprinted labels that were then prominently affixed to nearly every page of her medical record. The only contact information listed on the labels was the plaintiffs home telephone number, with no mention of the plaintiff’s request not to be called there.

In accordance with the Center’s procedures, upon the plaintiffs admission to the Center, she read and signed a form listing her rights as a patient. Among them was the right to privacy and confidentiality of her medical information and records. It is undisputed that the plaintiff never waived that right, and never authorized anyone at the Center to discuss her treatment with anyone else.

The plaintiff underwent the abortion without complication and was discharged the same day. Ordinarily, consistent with the requirements of the State Hospital Code (see 10 NYCRR 756.3 [e]), a determination of the plaintiffs blood group and Rh type would be made prior to the procedure, as the results would determine whether she needed an injection of Rh immune globulin within 72 hours of the procedure. However, part of the plaintiffs blood test results was still pending on the day of the abortion, and therefore, upon her discharge, she was told to follow up with her admitting physician as soon as possible to obtain her missing blood test results. As instructed, the plaintiff called the admitting physician the next morning and was told that her blood test results were in and that she would not require the injection. The Center apparently received a faxed copy of the plaintiffs blood test results from her physician at approximately 8:42 that morning, but the information was not entered in the plaintiffs chart.

Later that afternoon, evidently unaware that the blood test results had been received, a nurse at the Center followed her supervisor’s instructions to check on whether the plaintiff had obtained her missing blood work “because that was something that was of concern.” Using the only telephone number appearing on the preprinted label affixed to the top right corner of the Center’s telephone follow-up form, the nurse called the plaintiffs home. The plaintiffs mother answered and, although the nurse testified that she was well aware that she was speaking not with the plaintiff but with her mother, she nevertheless had a conversation with the mother about the plaintiff. Without explicitly mentioning that the plaintiff had undergone an abortion, the nurse asked the mother, among other things, whether the plaintiff had experienced any vaginal bleeding, and told her that the plaintiff needed to find out her blood group and Rh type. Based upon her conversation with the nurse, the mother concluded that the plaintiff had had an abortion.

The plaintiff immediately complained to the Center regarding the breach of confidentiality. An investigation was subsequently conducted by the New York State Department of Health’s Office of Health Systems Management, which determined, inter alia, that the nurse who had called the plaintiff’s mother had revealed privileged information without the plaintiffs permission, and that the Center had subsequently failed to respond to the plaintiffs verbal and written complaints. Nevertheless, the nurse in question retained her position with the Center, and her supervisor—who had participated in the Department of Health’s investigation—was apparently unaware that the Department had found that the nurse’s conduct amounted to a breach of patient confidentiality.

When the plaintiff later commenced this action, asserting causes of action alleging breaches of confidentiality, privacy, and fiduciary duty, and seeking compensatory and punitive damages, the Center conceded liability, and the matter proceeded to trial on the question of damages. The jury awarded the plaintiff the sum of $65,000 for past and future emotional distress and the sum of $300,000 in punitive damages. The Supreme Court denied the Center’s motion to set aside the verdict pursuant to CPLR 4404 and entered judgment. The Center appeals, challenging, inter alia, the award of punitive damages.

II

The Court of Appeals has most recently addressed the question of punitive or exemplary damages in Ross v Louise Wise Servs., Inc. (8 NY3d 478 [2007]), a case involving an adoption that occurred in 1961. The plaintiff adoptive parents sued the defendant, an adoption agency, for having intentionally concealed from them the history of schizophrenia and other severe emotional disturbances in the child’s biological family. In defending the action, the agency explained that it had adhered to its policy at the time of not disclosing certain adverse information about a birth family’s medical history if doctors were unsure that the conditions or problems in question were hereditary. The agency asserted that, in 1961, when the adoption occurred, it was the belief of its social workers and psychiatrists that a child’s mental health depended principally on the way it was nurtured rather than on its birth family’s medical history, and that disclosure could adversely affect the bonding between parents and child. It was not until some 20 years after the adoption that New York’s Legislature enacted a law requiring that a birth family’s medical history be disclosed, inter alia, to preadoptive and adoptive parents (see Social Services Law § 373-a). Nearly 15 years after that, the plaintiffs, whose adopted child, now an adult, continued to suffer from mental illness, demanded that the agency disclose the medical history of his birth family. Upon receiving that disclosure, the plaintiffs commenced suit against the agency, seeking compensatory and punitive damages. The Court of Appeals disallowed the claim for punitive damages.

Our dissenting colleagues cite this holding as instructive because, in their view, the adoption agency’s conduct was “far more egregious than the negligence at issue in this case, and resulted in far more devastating consequences” (infra at 91). The dissenters observe that, “[d]uring his childhood, [the adopted child] exhibited severe behavioral problems, prompting the plaintiffs to seek psychiatric help for him. As [the child] grew older, his behavior became increasingly violent, and he was eventually diagnosed as a paranoid schizophrenic” (infra at 92). Indeed, as described by the Court of Appeals, although the adoptive parents contacted the agency on several occasions during the child’s early years to report his difficulties and ask questions about his family history, the agency continued to withhold the fact that there was a history of schizophrenia on both sides of his family. Following the child’s graduation from high school in 1978, the adoptive mother felt compelled to move out of the family home with the couple’s younger daughter because she feared for their physical safety. Finally, on one night in 1995, the adoptive father awoke to find his adoptive son about to strike him with a large flashlight. The child was taken to Bellevue Hospital, where he was diagnosed as a paranoid schizophrenic.

This tragic sequence of events would, at first blush, seem to cry out for punitive sanctions against the agency—sanctions that the Court of Appeals nonetheless would not allow. The reason for the court’s decision, however, as the court took pains to point out, was that only one of the plaintiffs’ causes of action survived the statute of limitations, and that cause of action alleged acts committed at the time of the adoption in 1961 and not at any later time. As the Court of Appeals wrote:

“The complaint here includes a single cause of action for wrongful adoption and fraud at the time of the adoption. There are no separate counts of fraud concerning conduct in later years. Thus, even though no justification may exist, for example, for the Agency’s failure to disclose information to the doctors plaintiffs consulted for [the adopted child] in the 1970s, the fraud of wrongful adoption must center on the conduct that induced the prospective parents to accept the child. Because we cannot conclude from the record that the initial concealment was motivated by malice so as to warrant punitive damages, or that these damages would deter future reprehensible conduct, we limit plaintiffs’ potential recovery to compensatory dámages” (Ross v Louise Wise Servs., Inc., 8 NY3d at 491 [emphasis supplied]).

Additionally, our dissenting colleagues take the view that punitive damages are not available here because the conduct complained of was undertaken in good faith and out of concern for the plaintiffs well-being. We agree that the record does not demonstrate a bad-faith, intentional violation of the plaintiffs rights or an act done maliciously with the purpose of causing injury. But we do not read New York law as making proof of bad faith or malicious motive a necessary element of all demands for punitive damages.

New York does not recognize an independent cause of action for punitive damages. Instead, “[a] demand or request for punitive damages is parasitic and possesses no viability absent its attachment to a substantive cause of action” (Rocanova v Equitable Life Assur. Socy. of U.S., 83 NY2d 603, 616 [1994]). Demands for punitive damages usually arise in the context of intentional torts such as fraud, libel, or malicious prosecution, and therefore the availability of punitive damages is often discussed in terms of conduct that is intentional, malicious, and done in bad faith. In Ross v Louise Wise Servs., Inc., for example, the sole cause of action in issue was based on wrongful adoption and common-law fraud, which, as the court noted, required proof, inter alia, of a false representation made with the specific intent to deceive the plaintiff (see Ross v Louise Wise Servs., Inc., 8 NY3d at 488). In other contexts, however, it is well-settled that conduct warranting an award of punitive damages “need not be intentionally harmful but may consist of actions which constitute willful or wanton negligence or recklessness” (Home Ins. Co. v American Home Prods. Corp., 75 NY2d 196, 204 [1990]; see e.g. Guariglia v Price Chopper Operating Co., Inc., 38 AD3d 1043 [2007], lv denied 9 NY3d 801 [2007]; Gruber v Craig, 208 AD2d 900, 901 [1994]). Such wantonly negligent or reckless conduct must be “sufficiently blameworthy,” and the award of punitive damages must advance a strong public policy of the State by deterring its future violation (Doe v Roe, 190 AD2d 463, 474-475 [1993]). Indeed, as the Court of Appeals has often said, a principal goal of punitive or exemplary damages is to “deter future reprehensible conduct” by the wrongdoer “and others similarly situated” (Ross v Louise Wise Servs., Inc., 8 NY3d at 489 [citations omitted]; see Zurich Ins. Co. v Shearson Lehman Hutton, 84 NY2d 309, 316 [1994]; Soto v State Farm Ins. Co., 83 NY2d 718, 724 [1994]; Walker v Sheldon, 10 NY2d 401, 404 [1961]; see also Suffolk Sports Ctr. v Belli Constr. Corp., 212 AD2d 241, 247 [1995]). We decline to hold, as our dissenting colleagues apparently would, that only conduct done with evil motive or in bad faith warrants deterrence through punitive damages. Courts in this state have long recognized that those who, without specifically intending to cause harm, nevertheless engage in grossly negligent or reckless conduct showing an utter disregard for the safety or rights of others, may also be deserving of the imposition of punitive damages (see e.g. Home Ins. Co. v American Home Prods. Corp., 75 NY2d 196 [1990] [products liability action based on failure to warn]; Giblin v Murphy, 73 NY2d 769 [1988] [breach of fiduciary duty without proof of outright fraud]; Fordham-Coleman v National Fuel Gas Distrib. Corp., 42 AD3d 106 [2007] [negligent failure to supply fuel under Public Service Law]; Guariglia v Price Chopper Operating Co., Inc., 38 AD3d 1043 [2007], lv denied 9 NY3d 801 [2007] [negligence in leaving prescription drugs within reach of toddler]; Colombini v Westchester County Healthcare Corp., 24 AD3d 712, 715 [2005] [negligent failure to keep ferrous materials away from an MRI magnet]; Sosa v Ideal El. Corp., 216 AD2d 128 [1995] [negligent maintenance of elevator]; Gruber v Craig, 208 AD2d 900 [1994] [negligent failure to repair gas pipe]; Figueroa v Flatbush Women’s Servs., 201 AD2d 613, 613-614 [1994] [medical malpractice in performance of abortion]; Doe v Roe, 190 AD2d at 474-476 [unauthorized disclosure of HIV-status information in violation of Public Health Law]; Graham v Columbia Presbyt. Med. Ctr., 185 AD2d 753 [1992] [negligent abandonment by physician of physically unstable patient during treatment]; Rinaldo v Mashayekhi, 185 AD2d 435 [1992] [driving while intoxicated]; McWilliams v Catholic Diocese of Rochester, 145 AD2d 904 [1988] [mistreatment of patient in community residence for mentally retarded persons]).

These cases teach that the egregiousness of a tortfeasor’s conduct, and the corresponding need for deterrence, cannot be made to depend solely on the tortfeasor’s intent or bad faith, but must also take into account the importance of the underlying right or public policy jeopardized by the tortfeasor’s conduct. Were it otherwise, courts would be powerless to deter the sort of wantonly reckless or grossly negligent conduct that tramples on the rights of others or puts their safety at risk. And we believe that the more important the right at issue, the greater the need to deter its violation.

We decline to hold that, as a matter of law, the callous, reckless, or grossly negligent disregard of an individual’s right to the privacy and confidentiality of sensitive medical information—a right protected by the declared public policy of this State (see Public Health Law § 2803-c [1], [3] [f])—cannot be sufficiently reprehensible and morally culpable to support an award of exemplary damages (see Doe v Roe, 190 AD2d 463 [1993]). We turn, then, to the question of whether, in this case, the evidence adduced at trial was sufficient to submit the issue of exemplary damages to the jury.

III

Our dissenting colleagues suggest that the evidence in this case shows, at most, that the Center’s policies, while perhaps not perfect, were nevertheless generally adequate, and that the injury to the plaintiff was the result of an isolated mistake committed in good faith by a well-meaning but misguided nurse. We respectfully disagree. To the contrary, there was sufficient evidence here for a rational jury to conclude that the Center’s conduct amounted to far more than simple carelessness, but rose to the level of recklessness, gross negligence, and callous indifference to the plaintiff’s rights necessary to support an award of punitive damages. The Center was a medical provider that performed abortions yet had no reasonably effective policy in place to protect the privacy and confidentiality of women who make the often wrenching decision to undergo those highly sensitive procedures. Its failures were numerous and manifest.

First, the Center had no “written plan” to implement the plaintiff’s “right to have privacy in treatment and . . . confidentiality in the treatment of personal and medical records” (Public Health Law § 2803-c [3] [f]), as required under Public Health Law § 2803-c (5). Second, the Center’s unwritten “no-call” policy was, at best, confusing and poorly understood by the nursing staff. Third, even if the Center had had a coherent written policy that was known to its nurses, the effectiveness of that policy would have been undermined by the admission staff’s practice of placing preprinted labels on virtually every page of a patient’s medical file without making any effort to determine whether the contact information appearing on those labels was consistent with, or contrary to, the patient’s instructions. Fourth, in apparent violation of the provisions of the State Hospital Code (see 10 NYCRR 756.3 [e]), the Center performed the procedure and discharged the plaintiff without having first obtained her full blood test results, thereby unnecessarily creating the need to contact her quickly—a need that led directly to the breach of confidentiality. Fifth, although received by the Center on the morning following the plaintiffs discharge, the missing blood test results never found their way into the plaintiffs chart, further contributing to a pressing need to contact her. Sixth, as a consequence of the Center’s failure to record the receipt of the blood work, a nurse felt impelled to reach out to the plaintiff and did so using her home number because it was the only telephone number appearing on the label affixed to the Center’s telephone follow-up form. And, seventh, the nurse apparently felt unconstrained by any policy of the Center from disclosing confidential patient information to a person she knew to be someone other than the plaintiff.

In the dissenters’ view, the foregoing “is wholly lacking in the element of blameworthiness” (infra at 94), and no valid line of reasoning and permissible inferences could possibly lead a rational juror to conclude otherwise. We respectfully disagree. While the jury in this case might well have concluded that the Center’s conduct was merely careless, that was certainly not the only possible conclusion to be drawn from the evidence— particularly when viewed in the light most favorable to the plaintiff. And, in our view, the issue of punitive damages need not be taken away from the jury simply because conflicting inferences may be drawn regarding the blameworthiness of the defendant’s conduct (cf. Crane v Bennett, 177 NY 106, 116 [1904]). “If there is a reasonable basis for an award of punitive damages . . . whether such damages should be awarded and the amount of such award are issues for the jury” (Doe v Roe, 190 AD2d at 475; see Nardelli v Stamberg, 44 NY2d 500, 503 [1978]; Pchelka v Loomis-Root, Inc., 210 AD2d 889, 889-890 [1994]).

In Ross v Louise Wise Servs., Inc., the adoption agency offered an arguably reasonable explanation for its policy in 1961 of not disclosing the medical and psychological history of the child’s birth family. Moreover, an award of exemplary damages in that case would have served no deterrent purpose because, following the conduct complained of, and well before the plaintiffs commenced their action, a law was enacted mandating the very disclosure that had been intentionally denied to the plaintiffs in 1961. Thus, neither the defendant in that case nor other agencies similarly situated were likely ever again to engage in the allegedly tortious withholding from adoptive parents of the medical history of their child’s birth family.

In stark contrast, here there was no justification whatsoever offered for the remarkably casual way in which the Center handled the plaintiffs sensitive medical information, and the need to deter other medical providers from engaging in similar conduct could hardly be clearer. We strongly disagree with the dissenters’ conclusion that “the imposition of punitive damages in this case is completely unnecessary to deter similar conduct in the future . . . [because] corrective action has already been taken by the Center” owing to the fact that “the Department of Health issued a ‘Statement of Deficiencies,’ and required the Center to formulate a plan to correct each specified deficiency” (infra at 97-98). The dissenters fail to mention that the Center’s administrator, who was directly involved in the Department of Health’s investigation, had no specific recollection of its findings, and in fact believed—erroneously—that the agency had concluded that the plaintiffs right of confidentiality had not been breached—a belief which may well explain why no disciplinary action was apparently taken against the nurse who spoke to the plaintiff’s mother, despite the Center’s written policy that “any breach of confidentiality by an employee may be subject to [sic] termination.” Under these circumstances, we simply cannot share the dissenters’ confidence in the deterrent value of regulatory oversight.

Punitive damages may be awarded “for the conscious disregard of the rights of others or for conduct so reckless as to amount to such disregard” (Hartford Acc. & Indem. Co. v Village of Hempstead, 48 NY2d 218, 227 [1979]; accord Welch v Mr. Christmas, 57 NY2d 143, 150 [1982]). Unlike our dissenting colleagues, we cannot conclude, as a matter of law, that no valid line of reasoning and permissible inferences could possibly lead rational jurors, on this record, to the conclusion that the Center’s conduct was so reckless as to amount to a conscious disregard of the plaintiffs rights, or that exemplary damages would not have an important deterrent effect on other medical providers similarly situated (compare Cohen v Hallmark Cards, 45 NY2d 493, 499 [1978], with Matter of New York City Asbestos Litig., 89 NY2d 955, 956-957 [1997]). Aside from everything else, we are particularly fortified in this view by the substance of the nurse’s call to the plaintiffs mother. The dissenters write that “[t]he purpose of [the nurse’s] call was both to determine whether the plaintiff was experiencing any adverse effects from the abortion procedure such as nausea, pain, or dizziness, and to ensure that she had contacted her doctor’s office to obtain her blood test results” (infra at 88 [emphasis supplied]). In fact, knowing that she was speaking to the mother of a young woman who had just undergone an abortion, the nurse felt free to ask the mother to remind the plaintiff to find out her blood group and Rh type, and to ask the mother whether her daughter was experiencing any vaginal bleeding. In our view, a rational jury could find that the nurse, unconstrained by any practice or policy of the Center, wilfully and in reckless disregard of the plaintiffs rights and expressed wishes, disclosed to her mother that she had had an abortion. Thus, we hold that the question of whether the Center’s conduct in this case was merely careless or instead rose to the level of recklessness or gross negligence sufficient to support an award of punitive damages presented a genuine issue of fact for the jury to resolve.

IV

Although the issue of punitive damages was properly submitted to the jury in this case, a new trial on the issue is nevertheless required because of errors committed by the trial court.

To begin with, the Center was improperly precluded from introducing evidence regarding the absence of past breaches of confidentiality. Whether the injury-producing conduct was an isolated event or only the latest incident in a continuing pattern of similarly reckless behavior was an important factor to be weighed by the trier of fact in determining whether an award of punitive damages was warranted (see State Farm Mut. Automobile Ins. Co. v Campbell, 538 US 408, 419 [2003]; BMW of North America, Inc. v Gore, 517 US 559, 576-577 [1996]). Just as evidence of prior similar breaches may have provided some evidence that the Center consciously or recklessly disregarded the plaintiffs rights here by adhering to a procedure known to be flawed, so too evidence of the absence of any prior breaches would have been some evidence that the procedures followed by the Center were not known to be flawed and therefore adherence to them did not constitute the blameworthy conscious or reckless disregard of the plaintiffs rights required for the imposition of punitive damages. Although the existence or absence of prior similar breaches would not have been determinative, the jury should have been allowed to consider such information in assessing the blameworthiness of the Center’s conduct.

Moreover, although we are aware that a different view has been expressed by other courts as to the requisite evidentiary standard (see Matter of Seventh Jud. Dist. Asbestos Litig., 190 AD2d 1068, 1069 [1993]; Greenbaum v Svenska Handelsbanken, N.Y., 979 F Supp 973 [1997]), we hold that the trial court “erred in failing to charge the jury that the standard of proof regarding the imposition of punitive damages was clear and convincing evidence” (Orange & Rockland Util. v Muggs Pub, 292 AD2d 580, 581 [2002]; see Munoz v Puretz, 301 AD2d 382, 384 [2003]; Sladick v Hudson Gen. Corp., 226 AD2d 263, 264 [1996]; Camillo v Geer, 185 AD2d 192, 194 [1992]).

Finally, contrary to the Center’s contention, the jury’s award of compensatory damages was not excessive (see CPLR 5501 [c]; Fareway Hgts. v Hillock, 300 AD2d 1023, 1024 [2002]; Bert v Port Auth. of N.Y. & N.J., 166 AD2d 351 [1990]), and the Center’s remaining contentions are without merit or need not be reached in light of our determination.

Thus, the judgment is modified, on the law, by deleting the provision thereof awarding punitive damages in the sum of $300,000. As so modified, the judgment is affirmed,, so much of the order dated March 29, 2005, as denied those branches of the defendant’s motion which were to set aside the jury verdict on the issue of punitive damages and for a new trial on those damages is vacated, those branches of the defendant’s motion which were to set aside the jury verdict on the issue of punitive damages and for a new trial on those damages are granted, the claim for punitive damages is severed, and the matter is remitted to the Supreme Court, Suffolk County, for a new trial on the issue of punitive damages and the entry of an appropriate judgment thereafter.