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Federal Judge Reprimands Defense Counsel After Delays Regarding Slip-and-Fall Settlement

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In an opinion issued April 23, 2013, U.S. District Chief Judge J. Curtis Joyner denied a plaintiff’s motion to enforce settlement, while at the same time, admonishing defense counsel for their role in delaying the same.

The underlying case of Mackrides v. Marshalls, et al. involved an 86 year-old woman who suffered a hip fracture after falling on defendant’s property in 2009. Suit was subsequently filed in the United States District Court for the Eastern District of Pennsylvania, and the parties ultimately agreed to settle the case in July 2012. By April 2013, defense counsel had yet to provide plaintiff with a disbursement of funds or a draft release. Plaintiff’s counsel therefore filed a motion to enforce the settlement.

In response, defense counsel argued that because the plaintiff was a Medicare beneficiary, documentation from the Centers for Medicare and Medicaid Services (CMS) was required to confirm the amount of any lien on the settlement. According to the Medicare Secondary Payer Act and the Medicare Recovery Act, when a plaintiff’s medical expenses are paid by Medicare, Medicare is entitled to reimburse itself from any settlement reached in a pending lawsuit. While plaintiff’s counsel had previously produced an “interim” letter from CMS stating that no expenses had been paid by Medicare, defense counsel maintained that a “final demand letter” (issued after agreement on settlement terms) would be necessary before the submission of a draft release or disbursement of settlement funds.

Concurring with defense counsel’s analysis, Judge Joyner acknowledged that Medicare did indeed have a right to reimbursement based on the settlement reached between the plaintiff and defendant. However, he noted that given the time which had passed since the plaintiff’s injury, the statute of limitations for Medicare’s claim had nearly expired. As plaintiff’s counsel had already provided a letter from CMS stating that no Medicare payments had been made, Judge Joyner was “hard pressed to understand why defendants . . . failed to even tender a proposed release or settlement agreement to the plaintiff,” particularly in light of the plaintiff’s “advanced age.” By failing to provide a draft release, the court found such “non-action [on behalf of defense counsel] to be clearly dilatory, unreasonable and bordering on sanctionable conduct.”

The conduct of defense counsel notwithstanding, Judge Joyner held that without a draft release or written settlement agreement, the terms of the settlement had not been established on the record and thus, could not be enforced. While plaintiff’s motion was ultimately denied, the delay tactics of defense counsel did not go unpunished, as Judge Joyner ordered counsel to show cause as to why “appropriate trial and/or monetary sanctions” should not be imposed. Additionally, taking into account the proximity to which Medicare’s claim for reimbursement would be time-barred, both parties were ordered to show cause as to why immediate re-listing for trial should not be affected.

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