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Phillips Nizer Press Release

February 12, 2003

Vikki Grodner
(212) 841-0703

Phillips Nizer Handles Important Case Involving New York's
Structured Judgment Statute in Court of Appeals of New York

NEW YORK -- Phillips Nizer represented New York Hospital in an important appeal to New York’s highest court involving the method of calculating structured judgments in tort cases under Articles 50-A and 50-B of the CPLR.  The case, Desiderio v. Ochs, has received substantial attention from health care institutions because of the critical care crisis facing the state. The New York State Attorney General filed a brief on the appeal and physician and hospital groups filed six amicus briefs in support of the hospital’s position.

In Desiderio, the jury awarded compensatory damages for the costs of future medical care, future lost earnings and past and future pain and suffering.  The largest single element of the jury award was for future nursing care.  The jury awarded $40,000,000 for future nursing care for round-the-clock nursing care for 55 years. The trial court, however, entered a structured judgment three times the jury’s future nursing care award.  It provided for periodic payments totaling $120,000,000 for future nursing care. This trebling of the jury verdict resulted solely from the method of computation of the structured judgment.  The trial court determined that Articles 50-A and 50-B and prior decisions by the Court of Appeals case law required use of this calculation method.

The firm was asked to handle the case on behalf of the hospital before the Court of Appeals. It challenged the trebling of the jury verdict as an absurd and unconstitutional result, particularly in light of Article 50-A and Article 50-B’s tort reform purpose.  It argued further that the gross distortion of the jury verdict could not be reconciled with bedrock New York case law requiring that compensatory damages be fair and reasonable. The mathematical formula in the statutes, it urged, could be interpreted in an elastic, rather than a fixed, manner that would permit the calculation of structured judgments that conformed with the evidence at trial and the jury verdict. On behalf of the hospital, we proposed a number of ways to interpret Article 50-A and Article 50-B that would avoid such unjust results.

The appeal was argued by Stuart Summit on February 12, 2003.  The Court of Appeals had not rendered a decision as of the date of this writing.