Judge reduces jury damages award for doctor in defamation case

A doctor will have to settle for just $3.5 million in damages rather than the $4.75 million a Marion Superior jury awarded after a judge on Friday reduced the jury’s award in a defamation case brought against a Carmel hospital after the doctor was falsely accused of drinking on the job.

In an order Friday, Marion Superior Judge Heather Welch reduced the award in favor of Dr. Rebecca Denman in what was believed to be the first jury verdict in an Indiana Commercial Court case.

The jury in January awarded the OB-GYN damages on four of five claims she brought against St. Vincent Carmel Medical Group Inc. The claims stem from a December 2017 incident at the hospital when she said a nurse falsely and belatedly accused her by email of having an odor of alcohol on her breath while at work.

Denman said that she did not consume alcohol on the day in question and that the hospital didn’t follow its policies and procedures for when such an accusation arises, but the accusation led to professional repercussions. She was placed on administrative leave and an indefinite suspension, followed by a probationary return to work that included monitoring and required enrollment in a treatment program.

Jurors who heard the case during a four-day trial before Marion Superior Civil Division 1 Judge Heather Welch awarded Denman $2 million on her defamation claims; $1 million each on her claims of fraud and constructive fraud; $500,000 on her claim of tortious interference with an employment relationship; and $250,000 on her claim of negligent misrepresentation. The jury concluded Denman did not prove her claim of civil conspiracy.

In her order Friday, Welch denied defense requests for a new trial on damages or a directed verdict, but she granted in part the motion to reduce damages, finding recovery on the fraud claims was duplicative of other damages.

“Regardless of whether the jury had intended to split the damages, allowing multiple recoveries under different causes of actions whose elements are supported by the same essential facts constitutes an impermissible duplicative recovery,” Welch wrote in a 45-page order.

The total judgment was reduced to $2.5 million against St. Vincent Carmel Hospital Inc. and $1 million against St. Vincent Medical Group Inc., plus pre- and post-judgment interest. Despite Indiana Supreme Court orders permitting judges to toll the accrual of post-judgment interest through mid-August on account of COVID-19, Welch permitted tolling only from March 16, the date of the COVID-19 order, through the date of her Friday order.

The defendants are represented in the case by attorneys with Bose McKinney & Evans while Denman is represented by Kathleen DeLaney of DeLaney & DeLaney, who noted the jury verdict was largely affirmed.

“We are studying the technical ruling on the small portion of the judgment about (St. Vincent’s) claims counting as a double award to see whether that should be reinstated as a matter of law on appeal,” she said in an email. “In all, we see this ruling as a strong affirmation of the jury’s multimillion dollar award for the wrongful conduct by the St. Vincent entities. Dr. Denman continues to feel vindicated by her resounding win at trial.” 

The case is Denman v. St. Vincent Medical Group, Inc. et al., 49D01-1807-PL-026160.