Murphy et al v. United States of America
MEMORANDUM OPINION AND ORDER by Senior District Judge James A. Parker granting in part and denying in part re Plaintiffs' 155 First MOTION in Limine to Exclude Collateral Source Evidence. (bap)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW MEXICO
DENNIS MURPHY, Guardian Ad Litem
for N.E.D., an incapacitated minor; JACOB
DOTSON; DOMINQUE BILLY, individually
and as next friend of I.C. and S.D., minors
No. 1:17-cv-00384 JAP/JHR
THE UNITED STATES OF AMERICA,
MEMORANDUM OPINION AND ORDER
On March 8, 2019, Plaintiffs Dennis Murphy, Guardian Ad Litem for N.E.D., Jacob
Dotson, and Dominique Billy, individually and as next friend of I.C. and S.D., minors (Plaintiffs),
filed Plaintiffs’ Motion in Limine to Exclude Collateral Source Evidence (Motion) (Doc. 155). In
the Motion, Plaintiffs ask the Court to prohibit Defendant United States of America (Defendant or
United States) “from presenting any evidence that support reducing its damages to N.E.D. for her
past, present and future medical and nonmedical care because such evidence is prohibited under
New Mexico’s collateral source rule.” (Doc. 155 at 1). On March 29, 2019, the United States filed
its response, and the Motion is fully briefed. 1 On April 30, 2019, the Court held a pretrial
conference and heard argument on the Motion. The Court, having considered the parties’ briefing,
arguments, and relevant law will grant the Motion in part and deny it in part.
See THE UNITED STATES’ RESPONSE TO PLAINTIFFS’ MOTION IN LIMINE RE: COLLATERAL
SOURCE. (Response) (Doc. 164); PLAINTIFFS’ REPLY MEMORANDUM OF LAW IN SUPPORT OF THEIR
MOTION IN LIMINE TO EXCLUDE COLLATERAL SOURCE EVIDENCE (Reply) (Doc. 167).
Courts have discretion in ruling on motions in limine. See Cavanaugh v. Woods Cross City,
718 F.3d 1244, 1249 (10th Cir. 2013). This case is scheduled for a non-jury trial and the Tenth
Circuit has observed that “in bench trials questions raised relative to the admission or exclusion of
evidence…become relatively unimportant, because the rules of evidence are intended primarily
for the purpose of withdrawing from the jury matter which might improperly sway the verdict.”
Tosco Corp. v. Koch Industries, Inc., 216 F.3d 886, 896 (10th Cir. 2000) (internal quotation marks
and citation omitted). Rather, there is a presumption that in a bench trial a court will consider only
competent evidence and disregard any incompetent evidence. See id. But motions in limine can be
useful procedural tools “necessary to facilitate the efficient administration of justice.” Grand
Canyon Trust v. Public Serv. Co. of N.M., 294 F. Supp. 2d 1246, 1247 (D.N.M. 2003). “A motion
in limine provides the court with the opportunity to rule on the admissibility of evidence and thus
prevents encumbering the record with irrelevant material.” Id.
Plaintiffs filed suit against Defendant seeking damages for alleged medical negligence,
negligent training and supervision, and personal injuries under the Federal Tort Claims Act
(FTCA), 28 U.S.C. § 2671, et seq., and New Mexico state law. See First Amended Complaint
(FAC). 2 Plaintiffs’ claims arise out of emergency medical treatment rendered to minor child
N.E.D. in February 2016 at the Gallup Indian Medical Center (GIMC), an Indian Health Services
facility in Gallup, New Mexico, following the child’s fall from playground equipment in a city
See FIRST AMENDED COMPLAINT FOR MEDICAL NEGLIGENCE, PERSONAL INJURIES AND
DAMAGES ARISING UNDER FEDERAL TORT CLAIMS ACT AND NEW MEXICO LAW (FAC) (Doc. 51).
park. Plaintiffs allege, among other things, that GIMC medical personnel failed to properly protect
and monitor N.E.D.’s airway following a rapid sequence induction and intubation. See FAC ¶ 36.
Plaintiffs claim this ultimately led to deprivation of oxygen for a period sufficient to cause N.E.D.
to suffer a permanent hypoxic brain injury. See id.
Plaintiffs seek to bar from admission during trial “any and all evidence of collateral source
payments” to which N.E.D. may be entitled as part of her past, present, and future care because
such evidence is prohibited by New Mexico’s collateral source rule and is “irrelevant,
inadmissible, and substantially more prejudicial than probative.” (Doc. 155 at 1, 15; Doc. 167 at
4-5). The United States argues that, to the extent Plaintiffs are suggesting that the United States
“be precluded from presenting evidence challenging the reasonableness of Plaintiffs alleged
damages, past or future, medical or non-medical” the Motion should be denied. (Doc. 164 at 5).
The Federal Tort Claims Act (FTCA) states that the government “shall be liable [for tort
claims]…in the same manner and to the same extent as a private individual under like
circumstances[.]” 28 U.S.C. § 2674. While the FTCA provides a mechanism for bringing a state
law tort action against the United States in federal court, it does not itself create a substantive cause
of action. See Lomando v. United States, 667 F.3d 363, 372 (3d Cir. 2011). Accordingly, the extent
of the government’s liability under the FTCA is determined by reference to state law. See Haceesa
v. United States, 309 F.3d 722, 724 (10th Cir. 2002).
New Mexico courts recognize what is known at the “collateral source” rule. “The collateral
source rule allows a plaintiff to seek full recovery from a tortfeasor even though an independent
source has compensated the plaintiff in full or in part for the loss.” Green v. Denver & Rio Grande
Western R.R. Co., 59 F.3d 1029, 1032 (10th Cir. 1995). Under the collateral source rule, “a
wrongdoer may not reduce the amount of damages he must pay to the victim by amounts already
paid to the victim by an independent (or collateral) source.” Fairres v. Byrne, No. 8-cv-1183
WJ/ACT, 2010 WL 11596239, at *1 (D. N.M. June 8, 2010). There are two primary rationales for
the rule. “First, public policy favors giving the plaintiff a double recovery rather than allowing the
wrongdoer to enjoy reduced liability simply because the plaintiff received compensation from an
independent source.” Green., 59 F.3d at 1032. The second rationale is that “by assuring a plaintiff’s
payments from a collateral source will not be reduced by a subsequent judgment, the rule
encourages the maintenance of insurance.” Id.
There are “exceptions to the rule that evidence of collateral source payments is
inadmissible.” Chavez v. Dennis, No. 05-cv-186, 2006 WL 8444105, *1 (D. N.M. June 22, 2006)
(discussing exceptions). Additionally, “[t]he collateral source rule generally does not apply when
the collateral source is somehow identified with the tortfeasor…in a suit against the tortfeasor.”
Id. (internal quotation marks and citation omitted). Under those circumstances, “[i]n effect, the
source is not sufficiently collateral to or independent of the tortfeasor; it is as if the tortfeasor
himself paid.” Quinones v. Pennsylvania Gen. Ins. Co., 804 F.2d 1167, 1171-72 (10th Cir. 1986).
The Tenth Circuit instructs that in such cases, “the tortfeasor’s liability is reduced by the amount
of payment made.” Id. (emphasis in original). Therefore, “[i]n the context of a FTCA suit, an
injured party who has already been compensated for his or her injuries can also recover damages
from the United States unless the sources of the original compensation were funds provided by the
United States.” Berg v. United States, 806 F.2d 978, 984 (10th Cir. 1986)(emphasis added).
Plaintiffs suggest that the United States has taken a position that any damages that may be
awarded for N.E.D.’s “past, present and future medical and non-medical care should be reduced
or ‘off-set’ by the amount that will be paid by any government funded programs.” (Doc. 155 at
2).3 Plaintiffs argue that evidence of any benefits funded from the federal government do not fall
within the exception to the collateral source rule because “payments from government programs
to which N.E.D.’s parents contributed are considered to come from a ‘collateral source.’” (Doc.
155 at 3). Specifically, Plaintiffs argue that payment of or availability of federal public benefits
such as Medicaid, Medicare, and special education support provided under Part B of the
Individuals with Disabilities Education Act (IDEA), should be treated as coming from collateral
The United States does not contest application of the collateral source rule to
circumstances, as here, where a plaintiff seeks recovery of expenses for which the plaintiff has
already been compensated by an insurer. (Doc. 164 at 2). However, the United States argues that
Plaintiffs should not be permitted to extend the collateral source rule “to permit recovery of all
future medical care, even if it is not actually sought, and even if it is available or provided by
governmental or other sources at a reduced or no cost to the Plaintiff.” (Doc. 164 at 2). Rather, the
United States argues that it is permitted to challenge whether a particular medical expense is
Plaintiffs concerns regarding the United States’ potential introduction of prohibited collateral source evidence
appears to stem from Plaintiffs’ objection to a proposed reversionary trust instrument presented to them by the United
States. In that proposed instrument, there are several clauses that require the trust administrator to first submit request
for payment to other sources or benefits before turning to the trust funds. (Doc. 155 at 6-8). Whether or not a
reversionary trust would be appropriate in this case is the subject of separate briefing by the parties and the Court will
not address those arguments here. See PLAINTIFFS’ MEMORANDUM IN OPPOSITION TO THE
ESTABLISHMENT OF A REVERSIONARY TRUST (Doc. 156); THE UNITED STATES’ RESPONSE BRIEF IN
SUPPORT OF ESTABLISHMENT OF A REVERSIONARY TRUST (Doc. 163); THE UNITED STATES’ BRIEF
IN SUPPORT OF ESTABLISHMENT OF A REVERSIONARY TRUST (Doc. 159); PLAINTIFFS’ RESPONSE
TO THE UNITED STATES’ BRIEF IN SUPPORT OF ESTABLISHMENT OF A REVERSIONARY TRUST (Doc.
“reasonably certain to be received in the future,” by presenting its own evidence that such care is
unnecessary or is available at no cost or via governmental services. (Doc. 164 at 3). The United
States also contends that it is allowed to present evidence that Plaintiffs have not sought or are
unlikely to seek a certain type of care. (Doc. 164 at 3).
Plaintiffs’ Motion is in some ways premature. Government programs and benefits such as
Medicare and Medicaid have increased the complexity of applying the collateral source rule.
Plaintiffs are effectively asking the Court to make a blanket ruling in a vacuum prohibiting any
and all evidence of collateral source payments without information regarding actual sources of
payments and write-offs for N.E.D.’s past medical expenses that Plaintiffs believe to fall under the
rule and without having yet heard evidence regarding N.E.D.’s future needs. Moreover,
determining whether a particular source of payment or requested “off set” is a collateral source
requires a plaintiff to show that “he or she contributed to a special fund that is separate and distinct
from general government revenues.”4 Berg, 806 F.2d at 985 (noting that in Steckler v. United
States, 549 F.2d 1372, 1379 (10th Cir. 1977), the test the Tenth Circuit “applied to determine
whether a particular payment was collateral or not focused on whether the injured party had
contributed to the fund from which he or she was now collecting”). Counsel’s argument in briefing
that N.E.D.’s father contributed to “such funds” does not satisfy Plaintiffs’ burden; rather,
Plaintiffs’ contention must be supported by admissible evidence.
When determining whether a particular source of benefits or payments is collateral in the context of a dependent
minor plaintiff, Courts have looked to payments into a special fund distinct from government revenues by person(s)
on whom the minor plaintiff is dependent. See, e.g., Overton v. United States, 619 F.2d 1299, 1308 (8th Cir. 1980)
(“plaintiffs receiving governmental benefits should receive their FTCA awards free of any set-off for those benefits if
there is a showing or a presumption that they or one on whom they were dependent paid a special levy or fee to make
the benefit possible”) (emphasis added).
If the United States is found liable for N.E.D.’s injuries and damages are awarded,
Plaintiffs should be able to make full recovery for N.E.D.’s past medical expenses against the
United States, notwithstanding the fact that N.E.D.’s own insurance policy or other collateral
source, may have already reimbursed Plaintiffs for these losses. New Mexico’s collateral source
rule is clear on this and the vast weight of authority applies the collateral source rule to allow
recovery of all past medical costs despite insurance payments and write offs. See, e.g., Prager v.
Campbell Cty. Mem’l Hosp., 731 F.3d 1046, 1059 (10th Cir. 2013); Pipkins v. TA Operating Corp.,
466 F. Supp. 2d 1255, 1258-59 (D. N.M. 2006).
However, under New Mexico law, “[a] party seeking to recover damages has the burden
of proving the existence of injuries and resulting damage with reasonable certainty.” Sandoval v.
Baker Hughes Oilfield Operations, Inc., 2009-NMCA-095, ¶ 25, 146 N.M. 853, 215 P.3d 791.
“An award of damages is improper if it is predicated ‘upon conjecture, guess, surmise or
speculation.’” Mosley v. Titus, 762 F. Supp. 2d 1298, 1324 (D.N.M. 2010) (quoting Sanchez v.
Martinez, 1982-NMCA-168, ¶ 20, 99 N.M. 66, 653 P.2d 897); see also Rael v. F & S Co., Inc.,
1979-NMCA-128, ¶ 13, 94 N.M. 507, 612 P.2d 1318 (“Damages based on surmise, conjecture or
speculation cannot be sustained. Damages must be proved with reasonable certainty. There is no
exception to the…rule for future damages. The ultimate fact which the plaintiff has the burden of
proving is future damages reasonably certain to occur as a result of the original injury.”).
Accordingly, in order for the United States to be found liable for N.E.D.’s future medical expenses
and care, Plaintiffs will have to prove those damages with reasonable certainty.
The United States will have the opportunity to challenge Plaintiffs’ evidence with its own
evidence demonstrating that such damages are unrelated to N.E.D.’s alleged injury or not
“reasonably certain” to occur. Also, the United States is not precluded from introducing evidence
that the reasonable value of past medical expenses is not reflected by the billed amounts. See
Williamson v. Metro. Prop. & Cas. Ins. Co., No. 15-cv-958, JCH/LF, 2018 WL 1787510, at *4
(D. N.M. April 12, 2018) (holding that “[t]he policy reasons behind the collateral source doctrine
compel the conclusion that the evidence of the [medical care provider’s] write-offs should be
excluded” but warning that the court’s ruling “does not prevent Defendant from introducing
evidence that the reasonable value of medical services is not reflected by the billed amounts”).
Application of the collateral source rule to bar the United States from introducing competing
evidence of the reasonable value of services would be inappropriate. See id. (“The collateral source
rule does not restrict evidence concerning the reasonableness of expenses for medical services
generally, but it does restrict the admission of evidence of the amount of write-downs Plaintiff, as
the injured party, received as a benefit from a source separate from the tortfeasor.”).
Ultimately, if the trial judge awards damages for N.E.D.’s future medical expenses and
care, additional argument may be required to determine whether any off-sets the United States may
request are considered collateral sources. Absent the benefit of knowing what future care needs
Plaintiffs may seek, and what challenges to the reasonableness of those services the United States
might bring, the Court will not speculate at this time on application of the collateral source rule to
damages for future medical expenses and care. The Court declines Plaintiffs’ request to issue a
blanket order excluding any and all evidence of collateral source payments. Rather, the Court will
grant Plaintiffs’ Motion in part and exclude collateral source evidence to the extent that it is
normally inadmissible as a means of showing that Plaintiffs received compensation from a
collateral source for past medical expenses caused by the United States’ allegedly wrongful acts.
However, the Court will deny Plaintiffs’ Motion to the extent that Plaintiffs seek to exclude
evidence that may be presented by the United States challenging (1) the necessity of past medical
care N.E.D. received as a result of her alleged injuries; (2) whether the expense of certain necessary
past medical care was reasonable; (3) whether N.E.D. is reasonably certain to receive Plaintiffs’
proposed future medical and non-medical care, treatment and services;5 and (4) the present cash
value of the necessary and reasonable expenses for future medical and nonmedical care, treatment
and services required by N.E.D. as a result of her alleged injuries. The trial judge will hear
objections to such proffered evidence and rule upon them in the context of the trial.
IT IS THEREFORE ORDERED THAT Plaintiffs’ Motion in Limine to Exclude Collateral
Source Evidence (Doc. 155) is GRANTED in part and DENIED in part as described above.
SENIOR UNITED STATES DISTRICT JUDGE
Under the New Mexico Medical Malpractice Act (MMA), “[e]xcept for punitive damages and medical care and
related benefits, the aggregate dollar amount recoverable” arising from injury to a patient as a result of malpractice
shall not exceed $600,000 per occurrence. NMSA 1978, § 41-5-6(A). New Mexico’s recovery cap applies in suits
against the United States. See Haceesa v. United States, 309 F.3d 722, 726 (10th Cir. 2002). Accordingly, any
“nonmedical care” referenced by Plaintiffs in briefing not falling within this exception would be capped at $600,000.
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?