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Interstate Fire and Cas. Co. v. Washington Hosp. Center Corp.

United States District Court, District of Columbia

January 18, 2013

INTERSTATE FIRE AND CASUALTY COMPANY, Plaintiff,
v.
WASHINGTON HOSPITAL CENTER CORPORATION, d/b/a Washington Hospital Center, Greenspring Financial Insurance Limited, and MedStar Health Inc., Defendants.

Page 88

David Drake Hudgins, Hudgins Law Firm, P.C., Alexandria, VA, Bethany Culp, Paulette S. Sarp, Minneapolis, MN, for Plaintiff.

George Samuel Mahaffey, Jr., Joseph B. Wolf, Linda S. Woolf, Baltimore, MD, for Defendants.

MEMORANDUM OPINION

AMY BERMAN JACKSON, District Judge.

Plaintiff, Interstate Fire and Casualty Co. (" Interstate" ), brought this action against Washington Hospital Center Corp. (" WHC" ), Medstar Health, Inc., and Greenspring Financial Insurance Ltd. (" GFIL" ). Interstate seeks reallocation of a $3,055,000 payment that it made to patient

Page 89

Radianne Banks as part of the settlement agreement between Banks, Progressive Nursing Staffers of Virginia, Inc. (" Progressive" ) (insured by Interstate), Nurse Chichio Hand, and WHC (insured by GFIL), as well as legal fees, costs, and monies paid by Interstate in defense and settlement of the underlying litigation. The action is now before the Court on GFIL's objections to Magistrate Judge Alan Kay's Memorandum Order on the issue of damages. Mem. Order [Dkt. # 59] (" MJ Mem. Order" ). GFIL has objected to the Magistrate Judge's Memorandum Order and asks the Court to set aside the Magistrate Judge's determination of damages on the basis that the Magistrate Judge lacked the authority to make a determination of the damages to be awarded to Interstate, and that he erred in determining that Interstate was entitled to reimbursement of the entire $3,055,000 paid to Banks, and $148,062 in attorneys' fees. The Court will construe the Magistrate Judge's Memorandum Order as a Report and Recommendation. Because the parties to the underlying action agreed to preserve Interstate's right to seek reallocation of the entire $3,055,000, and Interstate is entitled to prejudgment interest on that amount at the rate set forth in D.C.Code Section 28-3302(a), the Court will adopt the Magistrate Judge's findings and recommendations in full.

JURISDICTION OF THE MAGISTRATE JUDGE

GFIL first objects to the Magistrate Judge's Memorandum Order on the basis that the Magistrate Judge lacks authority to make a determination of the damages to be awarded to Interstate. The Court declines to wade into the legal question of the bounds of authority delegated to magistrate judges under the local rules of this Court, the Federal Rules of Civil Procedure, and the Federal Magistrates Act of 1968, 28 U.S.C. § 631 et seq. (2012). Rather, the Court will treat the Magistrate Judge's Memorandum Order as a Report and Recommendation and, accordingly, review the portions to which GFIL has objected under a de novo standard. See Callier v. Gray, 167 F.3d 977, 982-83 (6th Cir.1999) (holding that a magistrate judge was authorized to provide a report and recommendation on a question of damages " subject to the district judge's ongoing supervision and final decision" under 28 U.S.C. § 636(b)(3), which gives magistrate judges " such additional duties as are not inconsistent with the Constitution and the laws of the United States" ); cf. Conetta v. Nat'l Hair Care Ctrs., Inc., 236 F.3d 67, 73 (1st Cir.2001) (acknowledging that a magistrate judge could " hear the evidence and prepare a recommended decision as to the amount of damages [plaintiff was entitled]" ). This will not prejudice GFIL, which has had the opportunity to lodge its objections to any portions of the Magistrate Judge's order and to brief the relevant issues fully.

FACTUAL BACKGROUND

Since neither party objects to the findings set forth in the background section of the Magistrate Judge's Memorandum Order, the Court will adopt those findings. In addition, the facts of this case are laid out in detail in the Court's previous Memorandum Opinion addressing liability. Memorandum Opinion, 853 F.Supp.2d 49 (D.D.C.2012) [Dkt. # 47] (" Mem. Op." ). In summary, the relevant facts are as follows:

In the litigation underlying this action, a patient named Radianne Banks sued WHC and two physicians for medical malpractice. Id. at 51; Defs.' Statement of Undisputed Material Facts [Dkt. # 33-2] (" Defs.' SMF" ) ¶ 46; accord Pl.'s Opp. to

Page 90

Defs.' SMF [Dkt. # 34] ¶ 46. WHC filed a third-party complaint against Nurse Hand, the nurse responsible for Banks's post-op care, and Progressive, the organization that supplied her to WHC. Mem. Op., 853 F.Supp.2d at 51. The third-party complaint alleged contribution, and both common-law and contractual indemnification. See Third-Party Complaint, Banks v. WHC, No. 2007 CA 002022 M (D.C. June 25, 2008), Ex. 10 to Pl.'s Mot. for Partial Summ. J. [Dkt. # 32-14], ¶¶ 10-22. The contractual indemnification claim relied on a Temporary Staffing Agreement between Progressive and WHC, which provided that Progressive was required " to indemnify WHC for claims arising from the negligence of Progressive or its registered nurse employees who were provided to WHC." Id.; Mem. Op., 853 F.Supp.2d at 52-53. Progressive ...


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