Shean Satgunam v. Michigan State University
330660
| Mich. Ct. App. | Apr 18, 2017Background
- Dr. Shean Satgunam performed bariatric surgery on Patient A; Patient A later died and her estate asserted a medical-malpractice claim naming both Satgunam and Michigan State University (MSU).
- MSU engaged the law firm Hackney Grover Hoover & Bean; attorney Brett Bean investigated and the firm agreed to represent both MSU and Satgunam; a settlement of $650,000 was negotiated and paid by MSU/insurer.
- The settlement triggered a mandatory report to the National Practitioner Data Bank (NPDB); Satgunam alleges the report harmed his reputation and employability.
- Satgunam sued the law firm for legal malpractice (claiming improper settlement without informed consent and failure to advise about NPDB reporting) and sued MSU for breach of an indemnification/employment obligation to provide conflict-free counsel.
- Trial courts granted summary disposition to both defendants; the circuit court also awarded case-evaluation sanctions to the law firm. Satgunam appealed three rulings; the Court of Appeals affirmed all.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Applicability of "case-within-a-case" in malpractice suit | Satgunam: doctrine should not apply because his harm is reputational and the underlying malpractice claim was defensible | Law firm/MSU: doctrine applies because Satgunam must prove he would have completely prevailed so there would have been no NPDB report | Court: doctrine applies here because the asserted harm (no NPDB report) requires showing the underlying claim would have been fully avoided; summary disposition for defendants affirmed |
| Need for expert testimony on causation | Satgunam: jury can infer reputational harm and causation from common knowledge; expert on legal malpractice breach suffices | Defendants: complex medical issues and multiple causes require expert proof that "but-for" the alleged malpractice Satgunam would have prevailed | Court: expert testimony was required on causation; plaintiff’s experts did not and could not opine that he would have prevailed, so summary disposition proper |
| MSU’s statutory/contractual authority to settle without plaintiff’s consent | Satgunam: MCL 691.1408 does not oust an employee’s autonomy; indemnification agreement preserved his control over settlement decisions | MSU: GTLA and university indemnification policy permit MSU to defend/settle and the indemnification agreement did not transfer control to the employee | Court: MSU had authority under MCL 691.1408 and indemnification clause did not prohibit MSU from settling; NPDB reporting was inevitable |
| Case-evaluation sanctions (timeliness, interests of justice, fee amount) | Satgunam: sanctions filing untimely; novel legal issue warranted refusing sanctions; awarded fees should be actual billed rates | Law firm: filing delay excused by court closure; plaintiff imprudently rejected low case evaluation; Smith framework supports awarding reasonable market-based fees | Court: excused late filing, interests-of-justice exception not triggered, and trial court correctly used Smith framework to award reasonable market-rate fees (not necessarily billed rate) |
Key Cases Cited
- Charles Reinhart Co. v. Winiemko, 444 Mich. 579 (Mich. 1994) (elements of legal malpractice claim).
- Coleman v. Gurwin, 443 Mich. 59 (Mich. 1993) (discussion of "case within a case" and its limited application).
- Basic Food Indus., Inc. v. Grant, 107 Mich. App. 685 (Mich. Ct. App. 1981) (limits on "suit within a suit" requirement; proximate-causation discussion).
- Haliw v. Sterling Heights, 464 Mich. 297 (Mich. 2001) (cause-in-fact and proximate-cause framework).
- Dean v. Tucker, 205 Mich. App. 547 (Mich. Ct. App. 1994) (expert usually required in professional malpractice cases).
- Smith v. Khouri, 481 Mich. 519 (Mich. 2008) (framework for awarding attorney fees under MCR 2.403 and determining reasonable hourly rates).