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Estate of Prather v. Sherman Hospital Systems

Court of Appeals of Illinois, Second District

June 26, 2015

THE ESTATE OF GIANNA PRATHER, a Minor, By and Through her Grandmother, Josefa Pena, and her Plenary Guardian, the Northern Trust Company, Plaintiff-Appellant,

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Appeal from the Circuit Court of Kane County. No. 08-L-220. Honorable F. Keith Brown, Judge, Presiding.

Burton I. Weinstein, of Baskin, Server, Berke, Weinstein & Spiro, of Chicago, for appellant.

Aiju C. Thevatheril and Catherine Basque Weiler, both of Swanson, Martin & Bell, LLP, of Chicago, for appellees Sherman Hospital Systems and Sherman Hospital, Inc.

Suzanne F. Gillen and Michelle M. Paveza, both of Langhenry, Gillen, Lundquist & Johnson, LLC, of Wheaton, for appellee Carol Korzen.

JUSTICE BURKE delivered the judgment of the court, with opinion. Justices McLaren and Jorgensen concurred in the judgment and opinion.



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[¶1] Plaintiff, the estate of Gianna Prather, appeals from the trial court's orders that dismissed the case after approving a settlement agreement with defendants, Sherman Hospital Systems, Sherman Hospital,

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Inc. (collectively, Sherman Hospital), and Dr. Carol Korzen. Dr. Korzen delivered Gianna Prather at Sherman Hospital in Elgin. Soon after her birth, Gianna was diagnosed with permanent neurological injuries, and she now suffers from profound physical and developmental disabilities. Gianna resides at Misericordia Home, where the State pays for her care.

[¶2] Gianna's mother, Jaclyn Pena-Prather, filed a complaint against defendants in the circuit court of Cook County, seeking damages for Gianna's condition. Defendants successfully moved to transfer the matter to the circuit court of Kane County, and the Northern Trust Company was named guardian of Gianna's estate. Before trial, the parties engaged in extensive settlement negotiations, but Gianna's grandmother, Josefa Pena, then the guardian of Gianna's person, refused defendants' final settlement offer of $3 million. It appears from the record that Josefa and Northern Trust are represented by the same counsel, and nothing indicates that Northern Trust objected to Josefa's rejection of the offer. The trial court appointed a guardian ad litem, who recommended the proposed settlement as being in Gianna's best interest. Concluding that there was a significant risk that a jury would find defendants not liable, the trial court approved the settlement and dismissed the case, against the wishes of Gianna's family.

[¶3] On appeal, plaintiff argues that (1) the circuit court of Cook County erred in transferring the case to Kane County, (2) the guardian ad litem was appointed in error, (3) the settlement is not in Gianna's best interest, (4) the settlement process was " tainted by unwarranted confidentiality," and (5) Sherman Hospital violated rules of discovery and regulations promulgated under the Health Insurance Portability and Accountability Act (HIPAA) (42 U.S.C. § 1320d et seq. (2012)).

[¶4] Defendants respond that the transfer of the case was appropriate under the doctrine of forum non conveniens and that the settlement was in Gianna's best interest. Defendants also argue that plaintiff's appellate brief is deficient, and Sherman Hospital asks that it be stricken for failing to comply with Illinois Supreme Court Rule 341(h) (eff. Feb. 6, 2013) and Rule 342 (eff. Jan. 1, 2005). Dr. Korzen additionally argues that (1) Josefa lacks standing to bring this appeal, (2) this court should not review the appointment of the guardian ad litem, because we lack jurisdiction or plaintiff has waived the issue, (3) this court should not review the order transferring the action from Cook County to Kane County, because we lack jurisdiction or plaintiff has failed to provide a sufficient record on the issue, (4) plaintiff has not preserved its argument regarding confidentiality, and (5) this court lacks jurisdiction to review Sherman Hospital's alleged discovery violation. We conclude that, Dr. Korzen's meritless jurisdictional arguments notwithstanding, the orders transferring the matter to Kane County, approving the settlement, and dismissing the action were not an abuse of discretion. We affirm.


[¶6] On September 5, 2005, Jaclyn arrived at Sherman Hospital for elective induction of labor because she was more than 41 weeks' pregnant. Jaclyn was a patient of Dr. Korzen, who practiced obstetrics and gynecology in Elgin.

[¶7] After admission, an external monitor was applied and the fetus was continuously monitored throughout labor. At 2:15 a.m. on September 6, 2005, Jaclyn received an epidural. At 4:45 a.m., a nurse contacted Dr. Korzen to update her on Jaclyn's progress. Dr. Korzen was present at 7:20 a.m., and Jaclyn was coached to begin pushing.

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At 8:21 a.m., Gianna was delivered vaginally, weighing six pounds, four ounces.

[¶8] Gianna's Apgar scores were very low. At one minute after birth, Gianna's score was zero. At five minutes, her score was one. At 10 minutes, her score was three. The umbilical cord was described as " thin and shoe-string-like," and was coiled seven times. The cord also was described as having no Wharton's jelly around it, a substance usually present to cushion the cord. Gianna was diagnosed with hypoxic-ischemic encephalopathy (HIE) and metabolic acidosis. Gianna has cerebral palsy and a life expectancy of only 21 years.

[¶9] The parties dispute the cause of Gianna's permanent neurological injuries. Plaintiff asserts that she suffered intrapartum birth asphyxia and argues that the fetal monitor revealed late decelerations in labor, which indicated fetal distress that required an emergency caesarian section delivery hours before the vaginal delivery. Plaintiff alleges that Sherman Hospital, through its employees, negligently failed to interpret the fetal monitoring strips and notify Dr. Korzen of the " ominous nature" of the strips. Plaintiff further alleges that Dr. Korzen failed to timely diagnose the fetal distress and should have performed an emergency caesarian section. Plaintiff's expert, Dr. Harlan Giles, opined that Gianna was completely neurologically intact as late as 7:15 a.m. and that Dr. Korzen should have ordered an emergency caesarian section before then.

[¶10] Defendants' theory is that Gianna's cerebral palsy was neither predictable nor preventable. Defendants argue that the fetal heart tracings did not indicate intrapartum hypoxemia or acidosis; rather, the tracings were reassuring and the actions taken by the obstetrical team were within a reasonable standard of care. Defendants assert that the thinness of the umbilical cord, the way it was coiled, and the absence of Wharton's jelly indicate an antenatal event, a genetic abnormality, or both, which contributed to the neurological outcome and could not have been avoided by an earlier delivery. Defendants deny any liability.

[¶11] A. Cook County

[¶12] On December 20, 2006, Jaclyn filed her original complaint against defendants in the circuit court of Cook County. On February 26, 2007, Dr. Korzen moved to transfer the action to Kane County, and Sherman Hospital joined the motion to transfer. The parties disputed whether the public- and private-interest factors favored a transfer.

[¶13] Defendants argued that Jaclyn and Gianna were residents of Elgin and that Sherman Hospital was also in Elgin. Dr. Korzen was a resident of Hoffman Estates in Cook County but practiced in Elgin. Josefa, a fact witness, also lived in Elgin. Among the seven additional treating fact witnesses associated with Gianna's delivery, four resided in Kane County, three resided in McHenry County, and all worked in Kane County. Five of the seven witnesses provided affidavits stating that Kane County was more convenient than Cook County. Defendants also pointed out that Kane County's docket was less congested than Cook County's was.

[¶14] Jaclyn responded that " the vast majority of [Gianna's] relevant medical treatment and the location of the majority of the potential medical witnesses" were in Cook County. Jaclyn also pointed out that Sherman Hospital did business in Cook County through a subsidiary. Jaclyn argued that the relative legal congestion of Cook County was irrelevant and that travel to Cook County should not be a factor, because Cook County is adjacent to Kane County and the witnesses could travel by

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commuter rail, such that any inconvenience would be minimal.

[¶15] On November 6, 2007, the circuit court of Cook County granted the motion to transfer, but the record contains neither a transcript of the proceedings nor a written order explaining the court's reasoning.

[¶16] B. Kane County

[¶17] On May 1, 2007, Andre Prather, Jaclyn's husband and Gianna's father, died at the age of 23 from a bronchial asthma condition. Jaclyn and Gianna lived with Jaclyn's mother, Josefa. In April 2008, the Department of Children and Family Services (DCFS) removed Gianna from the home, and the caseworker's investigation revealed " credible evidence of child abuse and/or neglect," based on Jaclyn's difficulty in coping with the death of her husband and with Gianna's condition. DCFS eventually placed Gianna at Misericordia Home, where she resides today. The State pays for Gianna's care and treatment.

[¶18] On April 21, 2008, Josefa refiled the complaint in the circuit court of Kane County, and for the next six years the parties conducted discovery and prepared for trial. On August 5, 2009, the Northern Trust Company was appointed plenary guardian of Gianna's estate. On August 10, 2010, plaintiff filed its first amended complaint, which was substantially the same as the original complaint filed in Cook County. As the parties proceeded with discovery, plaintiff filed a second amended complaint on November 12, 2013, asserting that Josefa had been appointed the guardian of Gianna's person on August 11, 2010.

[¶19] In March 2014, the parties began settlement negotiations and submitted to the trial court pretrial memoranda that set forth their theories of the case. Sherman Hospital and Dr. Korzen tendered separate redacted memoranda to counsel for plaintiff, denying any liability. Plaintiff's memorandum claimed damages exceeding $22.5 million. On March 25, 2014, the trial court appointed Daniel Konicek as guardian ad litem to evaluate potential settlement offers. Plaintiff's counsel stated expressly that he did not object to the appointment.

[¶20] Konicek reviewed the redacted pretrial memoranda from defendants, the memorandum submitted by plaintiff, and the depositions of Dr. Korzen, Nurse Erickson, and the parties' experts. He also reviewed the fetal monitoring strips, researched the issues of causation and damages, evaluated Dr. Korzen's conduct during labor and delivery, met with plaintiff's counsel several times, and reviewed the report of plaintiff's damages expert.

[¶21] At a pretrial conference on April 24, 2014, Konicek again interviewed the parties and assisted the trial judge. There is no transcript of the conference, but the record indicates that defendants made a final offer to settle for $3 million: $1 million, representing the full amount of Dr. Korzen's insurance policy, and $2 million from Sherman Hospital.

[¶22] At a hearing the next day, on April 25, 2014, Konicek made a formal settlement recommendation based on his review of the documents, research, discussions with the parties, and overall evaluation of the case. Before Konicek made his recommendation, plaintiff's counsel pointed out to the court that, although a guardian ad litem usually is appointed when the minor's parents are unwilling to accept the recommendation of counsel or the trial court, no such uncooperativeness was present in this case. However, counsel stated, " I do welcome Mr. Konicek to ...

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