NCRIC, Inc. v. Columbia Hospital for Women Medical Center, Inc.

957 A.2d 890, 2008 D.C. App. LEXIS 410, 2008 WL 4425276
CourtDistrict of Columbia Court of Appeals
DecidedOctober 2, 2008
Docket05-CV-1269
StatusPublished
Cited by45 cases

This text of 957 A.2d 890 (NCRIC, Inc. v. Columbia Hospital for Women Medical Center, Inc.) is published on Counsel Stack Legal Research, covering District of Columbia Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
NCRIC, Inc. v. Columbia Hospital for Women Medical Center, Inc., 957 A.2d 890, 2008 D.C. App. LEXIS 410, 2008 WL 4425276 (D.C. 2008).

Opinion

GLICKMAN, Associate Judge:

In October 2000, NCRIC, Inc. (“NCRIC,” formerly the National Capital Reciprocal Insurance Company), a provid *893 er of medical malpractice insurance to District of Columbia physicians, sued the Columbia Hospital for Women Medical Center, Inc. (“Columbia”) in Superior Court for breach of their insurance contract. Columbia counterclaimed, alleging, inter alia, that NCRIC breached the contract and also tortiously interfered with Columbia’s business relations with its physicians. After a two-week trial, a jury rejected NCRIC’s claim and found in favor of Columbia on its counterclaims. The jury awarded Columbia damages of $220,002 on its breach of contract claim and $18 million on its tortious interference claim.

NCRIC asks us to reverse the verdict and remand for a new trial. Its appeal focuses on Columbia’s tortious interference claim. Columbia charged that NCRIC induced over thirty of its attending physicians to leave the hospital in the summer and fall of 2000 in retaliation for Columbia’s resistance to NCRIC’s improper demands for insurance payments to which it was not contractually entitled. According to Columbia, this NCRIC-induced “exodus” of almost half its medical staff ultimately forced it to cease operations in May 2002. NCRIC denied that it induced Columbia’s physicians to leave or that it was responsible for Columbia’s demise. NCRIC claimed the physicians bailed out because they realized Columbia was dying, and it did what was appropriate in the circumstances to preserve its existing contractual relationships with them.

Although NCRIC disagrees with the verdict, it does not challenge the sufficiency of the evidence to permit the jury’s finding of tortious interference. Its appeal presents three other issues. The first issue concerns the trial court’s instruction on the elements of the tort. NCRIC asserts the court erred by failing to tell the jury it had to find some wrongful conduct on NCRIC’s part in order to impose liability for its intentional interference with Columbia’s business relations. We conclude the court did not err in rejecting NCRIC’s request for such an instruction. Wrongful conduct is not an element of a prima facie case of tortious interference under District of Columbia law. Rather, the burden was on NCRIC to establish that its intentional interference was legally justified or privileged. NCRIC might have been entitled to an affirmative defense instruction to that effect, but it never requested one. The trial court was under no duty to craft such an instruction for NCRIC sua sponte.

The second issue NCRIC raises is whether Columbia presented sufficient evidence to support the jury’s award of $18 million for the tortious disruption of its business relations. NCRIC contends that Columbia’s evidence of its damages was speculative or flawed in various respects. We reject NCRIC’s challenges to the award, mainly because NCRIC did not preserve them at trial.

Lastly, NCRIC contends the trial court should have granted its request for a re-mittitur in light of evidence that a Columbia witness overstated one component of the hospital’s damages by a million dollars. Because it is speculative whether the million dollar error actually affected the amount of the jury’s award, we conclude the court did not abuse its discretion in denying NCRIC’s request.

I. Summary of the Facts

Founded in 1866, Columbia was a federally chartered hospital specializing in the provision of health care to women and infants in the District of Columbia. NCRIC, a company created by local physicians in 1980, is the leading provider of medical malpractice insurance in the District. In 1993, Columbia and NCRIC entered into a malpractice insurance program known as the “Retrospective Rating *894 Plan” or “Retro Plan.” The Retro Plan was designed to lower the premiums paid by Columbia’s attending physicians by having Columbia and NCRIC share the malpractice risk. Under the Plan, Columbia and NCRIC agreed to adjust the initially discounted premiums retrospectively on the basis of actual loss experience. If losses for a given plan year proved to be higher than anticipated, Columbia was to pay NCRIC an additional premium. If the losses were lower than expected, NCRIC was to give Columbia a refund.

By September 1996, when the original Retro Plan expired, the parties had determined that NCRIC owed Columbia a refund for the first year of the program, 1993-1994. In November 1996, however, NCRIC proposed that no money be exchanged until all claims for all the plan years were resolved. Columbia accepted that proposal. NCRIC agreed to pay interest on amounts it owed Columbia. 1

Without formally renewing the Retro Plan, Columbia and NCRIC continued after 1996 to operate in accordance with its terms. NCRIC did not send out termination notices and Columbia’s physicians still received premium discounts. Meanwhile, however, Columbia’s claims record and financial condition were sources of growing concern.. In late 1997, NCRIC informed Columbia that it would terminate the Retro Plan because of the hospital’s “precarious financial condition” unless Columbia paid NCRIC $1.7 million. This was the amount NCRIC believed Columbia owed in additional premium payments in light of claims experience to that point. NCRIC later reduced the sum it required as a condition of renewal to $1 million. Columbia objected but acceded to NCRIC’s demand in order to prevent the abrupt cancellation of its physicians’ malpractice insurance coverage. Columbia understood the million dollar payment as equivalent to an escrow of funds or “security deposit” that would “stay on Columbia’s books” and earn interest, pending the resolution of all covered malpractice claims and the final determination of the parties’ liabilities.

In February 1998, Columbia filed for bankruptcy. The filing was precipitated by the decision of Columbia’s main lending institution to foreclose on a $22 million line of credit. Columbia’s witnesses at trial identified NCRIC’s demand for $1 million as a substantial contributing causé of its bankruptcy. NCRIC presented expert witness testimony that Columbia was failing because, as a maternity hospital offering a limited range of obstetric and gynecological services, it occupied a vulnerable niche position in a highly competitive health care market with substantial excess capacity.

While Columbia was in bankruptcy, it received a proposal for malpractice insurance from Medical Inter-Insurance Exchange (“MIIX”), a national insurance company. The MIIX proposal appeared to be considerably less expensive than NCRIC’s Retro Plan. Upon learning of the competitive offer, NCRIC sent Columbia a letter stating that its “insureds are obviously concerned with the hospital’s attempt to replace NCRIC with a ‘foreign’ company,” and that Columbia “should understand that NCRIC intends to continue providing its much needed insurance protection to the physicians in this program with or without the support of [Columbia].” NCRIC representatives directly urged Columbia’s physicians to move to other hospital programs where they could maintain their NCRIC insurance coverage if Columbia discontinued its participation in the Retro Plan. Reportedly, NCRIC’s *895

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Bluebook (online)
957 A.2d 890, 2008 D.C. App. LEXIS 410, 2008 WL 4425276, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ncric-inc-v-columbia-hospital-for-women-medical-center-inc-dc-2008.