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Doc Wins $4.75M in Fraud, Defamation Case Against Hospital

— Ob/gyn said she was wrongly accused of substance abuse

Last Updated February 6, 2020
MedpageToday

A doctor in Indiana won $4.75 million in a defamation and fraud lawsuit against her former employer, .

Ob/gyn Rebecca Denman, MD, was awarded the damages by a jury in Indiana after suing St. Vincent Carmel Hospital and St. Vincent Medical Group. Denman's lawsuit stemmed from an incident in December 2017, where she said she was wrongly accused of smelling like alcohol during a shift at the hospital.

"I was relieved and gratified that the jury gave us a resounding win," Denman said in a statement to ľֱ.

The jury awarded her $2 million on her defamation claims, $2 million for fraud and constructive fraud claims, $500,000 on her claim of tortious interference with employment relationship, and $250,000 on her claim of negligent misrepresentation. The jury concluded that Denman could not prove her claim of civil conspiracy.

A representative from Ascension, the parent organization of St. Vincent's, told ľֱ that "we are very disappointed by the jury's verdict and are exploring all options available to us, including appeal."

In December 2017, a nurse practitioner at St. Vincent Carmel Hospital reported that Denman smelled of alcohol while working an overnight shift, according to the hospital's answer to Denman's complaint. The NP made this report to hospital officials the day after she suspected that Denman had been drinking, and Denman claims she was not made aware of this allegation until two days after the incident occurred.

Denman's lawsuit alleged this was a violation of the hospital's substance abuse protocols, as officials failed to give her the opportunity to disprove untrue allegations. She noted that she was not promptly assessed, sent for blood testing, or relieved from duty on the day of the incident -- all of which contradict the hospital's substance abuse policy.

About a week after the incident, officials from the St. Vincent Medical Group informed Denman that they had reviewed the allegation against her, and that she was required to leave work immediately until she was evaluated for substance abuse by the Indiana State Medical Association. Denman claims that at no point was she given the opportunity to respond to the investigation.

After stating that she was an impaired physician and entering treatment with a substance abuse counseling center in Chicago, Denman returned to work about three months after the incident. She entered a monitoring contract with a term of five years.

Lisa Gora, JD, of the American Health Lawyers Association, said it was alarming that the hospital appeared to deviate from its peer review process.

Most such processes include informing the physician of allegations prior to review and providing a fair hearing with the opportunity for the provider to offer a defense, Gora said.

"In this case, the doctor did not seem to be afforded any of that," Gora told ľֱ. "A hospital really needs to make sure that they comply with their own processes."

St. Vincent's denied that it acted in violation of substance abuse protocol in response to Denman's complaint. The organization also denied that it "violated any obligation to Plaintiff relative to the peer review process."

Although St. Vincent's plans to appeal this case, Denman hopes that the decision remains.

"I understand that St. Vincent's plans to appeal," Denman said. "My hope is that the jury's well considered verdict will be upheld on appeal. I hope that other physicians educate themselves on their legal rights and stand up for themselves when necessary."