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Inge v. Covenant Medical Group

United States District Court, D. New Mexico

March 14, 2018

ELIZABETH INGE and JOHNNY INGE, Plaintiffs,
v.
COVENANT MEDICAL GROUP, Defendant.

          MEMORANDUM OPINION AND ORDER

          STEPHAN M. VIDMAR JUDGE

         THIS MATTER is before the Court on Defendant Covenant Medical Group's Motion for Summary Judgment [Doc. 44], filed on December 7, 2017. Briefing is complete. [Docs. 53, 61]. Oral argument is not necessary because the motion can be decided on the briefs. Having considered the briefing, record, and the relevant law, the Court finds that the motion is well-taken and will be granted. Plaintiffs' claims and this civil action will be dismissed with prejudice.

         I. Background[1]

         Plaintiffs participated in an illegal scheme to obtain prescription painkillers in violation of federal and state laws. Their co-conspirator was David Jones, a nurse practitioner. Jones saw Johnny Inge as a patient at the Portales Medical Clinic (a clinic not affiliated with Covenant) from 2004 to 2013. Jones knew that Johnny Inge was a drug addict. Jones was an addict himself. In 2011, Jones began giving Johnny Inge fraudulent prescriptions for large quantities of narcotic painkillers in exchange for a portion of the pills. Some of those prescriptions were written in Johnny Inge's name. At other times, Jones would give Johnny Inge prescriptions made out to other individuals, including Elizabeth Inge. Johnny Inge began sharing the fraudulently-obtained narcotics with Elizabeth Inge sometime around 2012. She was aware of the illegal scheme and willingly participated in it. The scheme was temporarily suspended in 2013 when Jennifer Inge, Johnny's wife at the time, discovered some of the fraudulent prescriptions.

         Jones was hired by Covenant in 2014. He sent Johnny Inge a text message saying he was “back in business.” Johnny Inge scheduled an appointment with Jones, purportedly for a sinus infection, and the scheme resumed. They went to great lengths to conceal their illegal activity. For example, Jones might leave the prescriptions in an alley behind his house, or in his car. Johnny Inge would retrieve the prescriptions, get them filled, and then leave Jones' share of the pills in the alley or Jones' car. Elizabeth Inge was aware of these arrangements and accompanied Johnny on at least one occasion when he picked up prescriptions from the alley behind Jones' house.

         At some point Elizabeth began seeing Jones at Covenant as a patient herself. Jones started writing fraudulent prescriptions for her as well.[2] During the period Jones saw Elizabeth at Covenant, he prescribed more than a thousand oxycodone pills for her every month.[3] There was no medical necessity for these prescriptions.

         Such schemes typically end badly, and this one was no exception. Jones was arrested in February of 2015 and charged with dispensing a controlled substance without a legitimate medical purpose. He committed suicide shortly before he was scheduled to plead guilty.[4]Robert McClelland, the pharmacist who filled most of the prescriptions, was criminally charged and had his pharmacist's license suspended.[5] Plaintiffs avoided prosecution by agreeing to cooperate with federal authorities in Jones' arrest and prosecution. Plaintiffs lost income and job opportunities. Elizabeth Inge suffered an overdose and lost custody of her child. Both suffered heavy withdrawal symptoms when the scheme was finally terminated.

         Plaintiffs have filed at least three lawsuits seeking compensation for damages resulting from their illegal scheme. They sued McClelland in federal court.[6] That case was dismissed.[7]They have an action pending in state court against Jones' estate.[8] And in this action they seek damages from Covenant based on negligence, negligent hiring, unfair trade practices, and breach of fiduciary duty.

         II. Summary Judgment Standard

         Summary judgment will be granted “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). A genuine dispute exists if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party” on the issue. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). “Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment.” Id.

         The movant bears the initial burden of establishing that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law. Celotex Corp. v. Catrett, 477 U.S. 317, 323-24 (1986). “[T]he movant need not negate the non-movant's claim, but need only point to an absence of evidence to support the non-movant's claim.” Kannady v. City of Kiowa, 590 F.3d 1161, 1169 (10th Cir. 2010) (quoting Sigmon v. CommunityCare HMO, Inc., 234 F.3d 1121, 1125 (10th Cir. 2000). If this burden is met, the non-movant must come forward with specific facts, supported by admissible evidence, which demonstrate the presence of a genuine issue for trial. Celotex, 477 U.S. at 324. The non-moving party cannot rely upon conclusory allegations or contentions of counsel to defeat summary judgment. See Pueblo Neighborhood Health Ctrs., Inc. v. Losavio, 847 F.2d 642, 649 (10th Cir. 1988). Rather, the non-movant has a responsibility to “go beyond the pleadings and designate specific facts so as to make a showing sufficient to establish the existence of an element essential to [his] case in order to survive summary judgment.” Johnson v. Mullin, 422 F.3d 1184, 1187 (10th Cir. 2005) (alteration in original) (internal quotation marks omitted).

         At the summary judgment stage, the Court must view the facts and draw all reasonable inferences in the light most favorable to the non-movant. Scott v. Harris, 550 U.S. 372, 378 (2007). The Court's function “is not . . . to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial.” Anderson, 477 U.S. at 249. There is no issue for trial “unless there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party.” Id. Summary judgment may be granted where “the evidence is merely colorable, or is not significantly probative.” Id. at 249-50 (internal citation omitted).

         III. The Wrongful Conduct Rule

         The wrongful conduct rule is a well-settled rule of law:

that a person cannot maintain an action if, in order to establish his cause of action, he must rely, in whole or in part, on an illegal or immoral act or transaction to which he is a party, or where he must base his cause of action, in whole or in part, on a violation by himself of the criminal or penal laws.

Desmet v. Sublett, 1950-NMSC-057, ¶ 9, 225 P.2d 141, 142.

“The principle of this public policy is this: No court will lend its aid to a man who founds his cause of action upon an immoral or illegal act.” [Desmet, 1950-NMSC-057]. Notably, the wrongful conduct rule forecloses recovery by the plaintiff even where “the defendant has participated equally in the illegal activity.” Orzel v. Scott Drug Co., 449 Mich. 550, 537 N.W.2d 208, 212-13 (1995).
The contours of the wrongful conduct rule require that “the plaintiff's conduct must be prohibited or almost entirely prohibited under a penal or criminal statute, ” and that “a sufficient causal nexus must exist between the plaintiff's illegal conduct and the plaintiff's asserted damage.” Id. at 214-17. Further, “the defendant's culpability [must not be] greater than the plaintiff's culpability for the injuries[. . . . ]” Id. at 217 (citation omitted).

Romero v. United States, 159 F.Supp.3d 1275, 1280-81 (D.N.M. 2015) aff'd 658 F. App'x 376 (10th Cir. 2016).

         The plaintiff in Romero, a recovering drug addict, brought claims against several DEA agents for rekindling his addiction to crack cocaine. 159 F.Supp.3d at 1279. He alleged that he had been clean for a few months and had been taking steps to get his life together. Id. at 1277. The DEA agents allegedly directed a confidential informant to approach Romero and propose that he act as a broker to obtain crack. In exchange, Romero would be allowed to keep some of the crack for his personal use. Id. at 1281. He accepted the offer, and over a period of six months purchased crack several times for the confidential informant, each time keeping a portion of the drugs for himself. This allegedly “reignited” his addiction, causing him to suffer damages. Id.

         The Honorable Martha Vázquez, United States District Judge, dismissed Romero's claims under the wrongful conduct rule. Id. at 1282. Romero argued that the wrongful conduct rule should not apply because the government's conduct was a proximate cause of his injuries. Judge Vázquez found that the wrongful conduct rule was not precluded merely because there was more than one proximate cause of the plaintiff's injuries (i.e., Romero's conduct and the government's conduct). Id. at 1283. The Tenth Circuit affirmed Judge Vázquez's application of the wrongful conduct rule. Romero, 658 F. App'x at 379-80.

         Other courts have applied the wrongful conduct rule (or analogous doctrines) to bar claims similar to those brought here by Plaintiffs. See Orzel v. Scott Drug Co., 537 N.W.2d 208, 217-18 (Mich. 1995) (holding that the plaintiff's negligence claim against a pharmaceutical company for honoring her husband's fraudulent prescriptions, which led to his death, was barred by the wrongful conduct rule because his injuries resulted from his own wrongful conduct); Price v. Perdue Pharma Co., 920 So.2d 479, 481-86 (Miss. 2006) (holding that the plaintiff's malpractice claims against doctors and a pharmacy were barred by the wrongful conduct rule because the plaintiff's injuries resulted from his own illegal conduct in misrepresenting his medical history in order to obtain multiple prescriptions for OxyContin, a strong painkiller and a controlled medication); Jacobson v. Pfizer, 618 F. App'x 509, 511-12 (11th Cir. 2015) (upholding dismissal of the plaintiff's tort claims against pharmaceutical company based on the wrongful conduct doctrine, despite plaintiff's arguments that he was insane when he killed his wife and children as a result of defendant's drugs that put him into a manic and psychotic state); Foister v. Purdue Pharma, L.P., 295 F.Supp.2d 693 (E.D. Ky. 2003) (holding that the plaintiffs, who procured and used OxyContin illegally, could not recover in tort action against pharmaceutical company because the plaintiffs inevitably had to rely on their illegal actions to establish their claims); Pappas v. Clark, 494 N.W.2d 245');">494 N.W.2d 245 (Iowa Ct. App. 1992) (holding that the plaintiff's cause of action against his doctor and pharmacist was barred by his own illegal conduct in using cocaine and prescription drugs).

         In Plaintiffs' lawsuit brought against the pharmacist, McClelland, the Honorable James A. Parker, Senior United States District Judge, found, in pertinent part:

[The plaintiffs, Elizabeth Inge and Johnny Inge], as part of a scheme to traffic in controlled substances, initiated contact with [McClelland] to fill prescriptions that they knew were not valid. Even though [McClelland]'s conduct in dispensing unreasonably large quantities of narcotics to [the Inges] violated state and federal law, and even though [McClelland]'s conduct partially enabled [the Inges] to abuse and traffic the drugs, [McClelland]'s unlawful actions cannot be said to have been a greater cause of [the Inges]' injuries than [the Inges]' own unlawful behavior.

257 F.Supp.3d 1158. The Tenth Circuit affirmed Judge Parker's decision on February 20, 2018, holding that:

Even if [McClelland] also engaged in illegal conduct, breached his duties to the Inges, and benefited financially from the scheme, as the Inges argue, his conduct does not negate the Inges' own misconduct. The district court correctly applied the wrongful-conduct doctrine because there is no dispute that the Inges' lawsuit relies, at least in part, on their own illegal acts.

McClelland, No. 17-2109, slip op. at 6-7, 2018 U.S. App. LEXIS 3921, at *8.

         IV. Undisputed Material Facts

         For purposes of this motion for summary judgment, the Court finds the ...


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