Williams et al v. Cargill

Filing 21

ORDER Dismissing Case. Signed by Chief Judge Jeffrey L. Viken on 4/34/25. (SB)

UNITED STATES DISTRICT COURT
DISTRICT OF SOUTH DAKOTA
WESTERN DIVISION
CASEY WILLIAMS, TIMOTHY UPTON,
JOSHUA HANSEN, RONNIE OAKIE,
STEVEN MITCHELL and DAVID
BUJARSKI,

CIV. 14-5020-JLV
ORDER

Plaintiffs,
vs.
JOHN A. CARGILL,
Defendant.
INTRODUCTION
Pending before the court is defendant’s motion to dismiss. (Docket 8).
The court referred defendant’s motion to Magistrate Judge Veronica L. Duffy for
resolution pursuant to 28 U.S.C. § 636. (Docket 13). On August 5, 2014,
Magistrate Judge Duffy filed a report recommending the court grant defendant’s
motion to dismiss. (Docket 19 at p. 22). Plaintiffs timely filed objections to the
report and recommendation. (Docket 20).
The court reviews de novo those portions of the report and
recommendation which are the subject of objections. Thompson v. Nix, 897
F.2d 356, 357-58 (8th Cir. 1990); 28 U.S.C. § 636(b)(1). The court may then
“accept, reject, or modify, in whole or in part, the findings or recommendations
made by the magistrate judge.” 28 U.S.C. § 636(b)(1). For the reasons stated

below, plaintiffs’ objections are overruled. The court adopts in full the report
and recommendation of the magistrate judge.
DISCUSSION
Plaintiffs’ complaint alleges they were injured in a one-vehicle rollover on
March 18, 2013, in which defendant John Cargill was the driver. (Docket 1).
Plaintiffs assert diversity jurisdiction under 28 U.S.C. § 1332, alleging they are
citizens of the State of South Dakota, Mr. Cargill is a resident of the State of New
York and the matter in controversy exceeds $75,000. Id. ¶ 1. Mr. Cargill filed a
motion to dismiss claiming plaintiffs do not satisfy the controversy requirement
of exceeding $75,000 as required by 28 U.S.C. § 1332. (Docket 8).
The undisputed facts are as follows. On March 18, 2013, Mr. Cargill was
an employee of the South Dakota Department of Corrections (“DOC”). (Dockets
9 ¶ 2 & 11 at p. 3). At that time, the plaintiffs were all inmates on trustee status
with the DOC. (Docket 9 ¶ 3). On March 18, 2013, Mr. Cargill was operating a
motor vehicle owned by the State of South Dakota and used by DOC. Id. ¶ 5.
Plaintiffs were among the passengers in the vehicle when it was involved in a
single vehicle accident. Id. ¶¶ 5-6. Each of the plaintiffs received medical care
for their injuries by various medical care providers, all of which expenses were
paid for by DOC. (Dockets 9 ¶¶ 9-10 & 11 at p. 3). DOC is statutorily and
legally required to provide reasonable and necessary medical care for plaintiffs
while they are under the control of DOC. (Docket 9 ¶ 8). Neither plaintiffs nor
any third-party insurance policy paid for any medical expenses. Id. ¶ 10.
2

Mr. Cargill is no longer a DOC employee. Id. ¶ 2. Mr. Cargill is a resident of the
State of New York. (Docket 19 at p. 2 n.2).
Following referral of defendant’s motion, Magistrate Judge Duffy entered
an order directing plaintiffs “to submit additional pleadings or evidence,
including medical records and affidavits if they wish, to demonstrate that the
amount in controversy element is met as to each plaintiff. Plaintiffs may, in the
alternative, elect to have a live evidentiary hearing to adduce the evidence
required.” (Docket 14 at p. 9). Plaintiffs’ submissions were due by July 10,
2014, but that date could be extended for good cause. Id. at pp. 9-10.
On July 10, 2014, plaintiffs filed a supplement to the record. (Docket 15).
On July 22, 2014, plaintiffs filed an addendum to supplement the record.1
(Docket 17). Attached to the addendum were eleven exhibits relating to
plaintiffs Oakie and Mitchell. (Dockets 17-1 through 17-11).
Magistrate Judge Duffy found that as of July 18, 2014, plaintiffs incurred
the following medical expenses:
Casey Williams
Timothy Upton
Joshua Hansen
Ronnie Oakie
Steven Mitchell
David Bujarski

$
$
$
$
$
$

59,911.04
5,460.46
5,354.98
15,298.85
23,234.58
429.85

Magistrate Judge Duffy accepted plaintiffs’ addendum “recogniz[ing] that
administrative delays may arise when compiling the medical records of multiple
plaintiffs.” (Docket 19 at p. 2 n.2).
1

3

(Docket 19 at pp. 2-3). Id. at p. 3. All of plaintiffs’ medical expenses were paid
by DOC. Id. at p. 3. The magistrate judge also found that two of the plaintiffs,
Mr. Oakie and Mr. Hansen, are expected to undergo future surgeries with
anticipated costs of $42,4262 and $74,246,3 respectively. Id.
A. MAGISTRATE JUDGE’S FINDINGS OF FACT
Plaintiffs’ objections to the magistrate judge’s findings of fact are
summarized as follows:
1. Plaintiffs object to the finding they have not suffered permanent
physical impairment. (Docket 20 ¶ 11).
2. Plaintiffs object to the finding they have only demonstrated
intangible damages for pain, suffering and emotional distress.
Id. ¶ 12.
Each of these objections is addressed separately.
1. PLAINTIFFS OBJECT TO THE FINDING THEY HAVE NOT
SUFFERED PERMANENT PHYSICAL IMPAIRMENT
The magistrate judge properly concluded “[d]ue to Mr. Cargill’s motion,
plaintiffs bear the burden to demonstrate, by a preponderance of the evidence,
that their claim exceeds $75,000.” (Docket 19 at pp. 7-8). The magistrate
judge directed “plaintiffs to supply information about whether any of them
suffered any permanent physical impairment.” Id. at p. 21. The report found
“the record is silent. Plaintiffs have not asserted that any one of them has
2

Docket 17-5 at p. 1.

The estimate for surgery was reported as being $74,346. (Docket 17-11
at p. 1). The report and recommendation is amended to correct this
typographical error.
3

4

suffered a permanent impairment. No percentages of impairment are given.
No resulting economic loss is asserted. The court cannot guess at these matters
and so assumes that there is no such loss.” Id.
The magistrate judge specifically instructed plaintiffs to submit affidavits
and medical records to substantiate each element of damages or request an
evidentiary hearing to provide evidence on damages. (Docket 14 at p. 10).
Plaintiffs chose to submit a declaration of counsel which is summarized as
follows:
Casey Williams was lifeflighted to Rapid City Regional Hospital. He
suffered a spinal injury, was hospitalized for four days and wore a
back brace for four months.4
Timothy Upton was transported to the Lead-Deadwood hospital
emergency room by ambulance. He suffered neck and back pain
and a right hand laceration.5
Joshua Hansen was transported to the Lead-Deadwood hospital
emergency room by ambulance. He suffered left shoulder pain and
abrasions and neck pain.6 A C6-7 anterior cervical discectomy and
fusion are recommended.7
No medical records were submitted in support of Mr. Williams’ damages
claim and plaintiffs did not move for additional time to submit additional
evidence.
4

No medical records were submitted in support of Mr. Upton’s damages
claim and plaintiffs did not move for time to submit additional evidence.
5

Medical records from a January 2, 2014, examination notes “neck pain
with radiation to right arm, finger numbness on right hand digits #1, 2, and 3.
Symptoms since March 18, 2013.” (Docket 17-10 at p. 1). “Patient rates pain
10/10. Pain worse with lying down, coughing, moving neck rapidly.” Id. An
EMG noted “severe active Right C7 radiculopathy.” Id. at p. 3.
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7

Docket 17-10 at p. 4.
5

Ronnie Oakie was transported to the Lead-Deadwood hospital
emergency room by ambulance. He suffered neck pain8 and a
hand abrasion.9 A cervical decompression of the left 7th cervical
nerve is recommended.10
Steven Mitchell was transported to Lead-Deadwood hospital
emergency room by law enforcement. He suffered back pain, neck
pain, left shoulder pain11 and had rotator cuff surgery on July 1,
2014.12

A cervical MRI on July 29, 2013, noted at C6-C7 “there could be some
mild posterior displacement of the left ventral C7 nerve root.” (Docket 17-4 at p.
2).
8

A right upper extremity MRI on October 22, 2013, revealed “[l]arge
full-thickness rotator cuff tear involving the supra-and infraspinatus tendons
. . . . [p]robable complete tear involving the long of the biceps tendon . . . [h]igh
riding humeral head with degenerative changes associated with rotator cuff tear.
. . . .” (Docket 17-4 at p. 8). A MRI of the left upper extremity on October 22,
2013, revealed “[h]igh-grade partial thickness rotator cuff tear. . . [p]osterior
glenoid labral tear . . . . This can occasionaly [sic] affect the suprascapular nerve
which may affect the innervation of the infraspinatus muscle.” Id. at pp. 9-10.
9

10

Docket 17-5 at p. 1.

Medical records of the Black Hills Orthopedic & Spine Center on March 3,
2014, over eleven months after the accident, report Mr. Mitchell’s left “shoulder
has been hurting him since the accident in March . . . . He has tried a couple of
injections and antiinflamatory medications, which has [sic] not helped much at
all.” (Docket 17-7 at p. 1). Mr. Mitchell had a pain medication injection into
his shoulder that day. Id. at pp. 1-2. During an April 30, 2014, medical
examination it was noted that Mr. Mitchell “complains of diffuse pain around the
left shoulder with radiation down the upper arm. Pain does occasionally radiate
into the neck. . . . Patient has tried at least three injections, which unfortunately
has [sic] not helped him.” Id. at p. 3. Surgery was recommended to repair a
possible full thickness tear of the rotator cuff. Id. at p. 4.
11

Post-operative notes from the surgery indicate there had been a
“[m]oderate sized full-thickness rotator cuff tear, left shoulder.” (Docket 17-9 at
p. 1).
12

6

David Bujarski was transported to Lead-Deadwood hospital
emergency room by law enforcement. He suffered right knee pain
and back pain.13
(Docket 15 at pp. 1-2). Counsel states “all Plaintiffs have suffered
extreme emotional distress over the traumatic incident and their injuries.”
Id. at p. 2.
Plaintiffs’ objection advises they “will supplement the record as
necessary[]” on each plaintiff’s permanent physical impairment. (Docket
20 ¶ 11). The time has passed during which plaintiffs were entitled to
present evidence to carry their burden of proof. The magistrate judge
invited plaintiffs to supplement the record and present affidavits or other
evidence to show by a preponderance of the evidence that each plaintiff’s
individual damages cross the $75,000 threshold required by 28 U.S.C.
§ 1332. The report concluded plaintiffs had not carried the burden of
proof required by § 1332. The record is void of any evidence contrary to
the magistrate judge’s conclusion. The court is not permitted to
speculate or guess as to each plaintiff’s impairment. For these reasons,
plaintiffs’ objection is overruled.

No medical records were submitted in support of Mr. Bujarski’s damages
claim and plaintiffs did not move for time to submit additional evidence.
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7

2. PLAINTIFFS OBJECT TO THE FINDING THEY HAVE ONLY
DEMONSTRATED INTANGIBLE DAMAGES FOR PAIN,
SUFFERING AND EMOTIONAL DISTRESS
Plaintiffs object to the magistrate judge’s finding that the only
damages shown are for pain, suffering and emotional distress. (Docket
20 ¶ 12). Plaintiffs assert by the very fact of their separate surgeries they
have crossed the $75,000 threshold and “[t]he intangible damages [pain,
suffering and emotional distress] are considerably less for each of them.”
Id. Plaintiffs’ only argument is that because their medical bills are
significant, they have satisfied the damages threshold provision of § 1332.
Id. The issue surrounding medical expenses will be addressed in the
discussion regarding the magistrate judge’s conclusions of law.
For purposes of resolving findings of fact, the court finds the report
is an accurate statement of the record, specifically the absence of evidence
of pain, suffering and emotional distress. The court is not at liberty to
speculate as to the monetary value of each plaintiff’s individual pain,
suffering or emotional distress. Plaintiffs have not offered sufficient
evidence to satisfy the court by a preponderance that plaintiffs,
individually, have suffered pain, suffering, emotional distress or
permanent impairment to satisfy the $75,000 damages threshold of
§ 1332. For these reasons, plaintiffs’ objection is overruled.
Incorporating the additional facts above, the findings of fact
contained in the report are adopted.
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B. MAGISTRATE JUDGE’S CONCLUSIONS OF LAW
Plaintiffs object to a number of conclusions of law made by the
magistrate judge. (Docket 20 ¶¶ 1-10). Those objections are
summarized:
1. The magistrate judge erred as a matter of law by concluding the
collateral source rule prohibits plaintiffs from including past
medical expenses paid by the DOC in meeting the $75,000
damages threshold of 28 U.S.C. § 1332.
2. The magistrate judge erred as a matter of law by concluding the
collateral source rule prohibits plaintiffs from including future
medical expenses paid by DOC in meeting the $75,000 damages
threshold of 28 U.S.C. § 1332.
Each objection will be addressed separately.
1. THE MAGISTRATE JUDGE ERRED AS A MATTER OF LAW BY
CONCLUDING THE COLLATERAL SOURCE RULE PROHIBITS
PLAINTIFFS FROM INCLUDING PAST MEDICAL EXPENSES
PAID BY THE DOC IN MEETING THE $75,000 DAMAGES
THRESHOLD OF 28 U.S.C. § 1332
The essence of plaintiffs’ objection is that the magistrate judge analyzed
the issues of “wholly independent” and “collateral source rule” in South Dakota
using the wrong legal principles. It is undisputed all of plaintiffs’ medical
expenses to the date of filing the complaint were paid by DOC. (Docket 11 at p.
3). The question is whether plaintiffs are entitled to use those medical expenses
in meeting the $75,000 damages threshold of § 1332, or whether under South
Dakota law the collateral source rule prohibits consideration of those expenses.
The magistrate judge’s legal research did not disclose any South Dakota
authority defining the term “wholly independent” in applying the collateral
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source rule. See Docket 19 at pp. 13-15. Plaintiffs argue no definition of
“wholly independent” is necessary because “[s]ince South Dakota’s adoption of
the collateral source rule in 1975, courts have successfully applied it without a
precise definition.” (Docket 20 ¶ 1). Plaintiffs’ argument is not helpful to the
analysis because in order to determine whether the collateral source rule applies
to the facts of this case, the court must define “wholly independent.” Without
any clear definition from the South Dakota Supreme Court, this court must look
elsewhere to obtain a definition and complete its analysis.
The magistrate judge chose to use the definition of “wholly independent”
found in Schwartz v. Hasty, 175 S.W.3d 621 (Ky. Ct. App. 2005). (Docket 19 at
p. 15). Addressing the collateral source rule, the Kentucky Court of Appeals
stated “ ‘A source is wholly independent and therefore collateral when the
wrongdoer has not contributed to it and when payments were not made on behalf
of the wrongdoer.’ ” Id. at 627 (quoting Pustaver v. Gooden, 566 S.E.2d 199,
201 (S.C. Ct. App. 2002)).
Plaintiffs object to the use of this “definition of ‘wholly independent’
because it is merely persuasive.” (Docket 20 ¶ 2). The court overrules
plaintiffs’ objection and finds the definition of “wholly independent” used by
Kentucky and South Carolina is persuasive authority which the South Dakota
Supreme Court would likely adopt were that court compelled to define “wholly
independent.”

10

For application of “wholly independent” in the context of the collateral
source rule, the magistrate judge found guidance from Fisher v. Beckles, No.
K11C-01-040 WLW, 2014 WL 703755, at *2-4 (Del. Super. Ct. Feb. 10, 2014).
(Docket 19 at p. 15). In a factual setting precisely on point with the facts in this
case, the magistrate judge found Fisher instructive. Id. at p. 16. In Fischer,
the Delaware court concluded a prisoner plaintiff could not recover as damages
medical expenses paid by the Delaware Department of Corrections (“DDC”) for an
injury inflicted by a DDC employee. Fisher, 2014 WL 703755, at *4.
Plaintiffs object to the court’s consideration of Fisher as “illustrative of the
issue of the definition of ‘wholly independent’ because it is merely persuasive.”
(Docket 20 ¶ 5). The court finds Fisher is consistent with how the South Dakota
Supreme Court would use “wholly independent” in an application of the
collateral source rule. Plaintiffs’ objection is overruled.
The magistrate judge found Mr. Cargill was a DOC employee and because
of its employee’s conduct, DOC was required to provide plaintiffs with medical
care. (Docket 19 at p. 18). Based on this conclusion, the magistrate judge next
concluded “Mr. Cargill and the DOC are not wholly independent of one another,
and the plaintiffs should not be allowed to recover medical expenses that were
paid by the DOC . . . . especially where the plaintiffs paid no consideration for the
medical care provided . . . [which DOC] was legally obligated to provide.” Id.
(referencing Fisher, 2014 WL 703755 at *4).

11

Plaintiffs object to the magistrate judge’s analysis and conclusions.
(Docket 20 ¶ 6). Plaintiffs argue the court should reject the analysis employed
by the magistrate judge and adopt plaintiffs’ interpretation of the Restatement
(Second) of Torts § 920A Comment B (1979). Id. The Restatement comment
provides that “[i]f the benefit was a gift to the plaintiff from a third party or
established for him by law, he should not be deprived of the advantages that it
confers.” Id. (emphasis added by plaintiffs). Plaintiffs are not being deprived of
the benefits established by South Dakota law requiring DOC to pay plaintiffs’
medical expenses. Rather, the collateral source rule adopted by South Dakota
and applied by this court prohibits plaintiffs from making a double recovery─one
recovery from Mr. Cargill’s employer and a second recovery from Mr. Cargill.
This is precisely the consequence contemplated by the collateral source rule.
The court adopts the conclusion of the magistrate judge. The court
agrees the collateral source rule bars plaintiffs from recovering from Mr. Cargill
for the medical expenses paid by DOC. Plaintiffs’ objections on this issue are
overruled.
2. THE MAGISTRATE JUDGE ERRED AS A MATTER OF LAW BY
CONCLUDING THE COLLATERAL SOURCE RULE PROHIBITS
PLAINTIFFS FROM INCLUDING FUTURE MEDICAL EXPENSES
PAID BY DOC IN MEETING THE $75,000 DAMAGES THRESHOLD
OF 28 U.S.C. § 1332
The magistrate judge separately analyzed whether the collateral source
rule would preclude plaintiffs from asserting future surgical expenses as
damages for inclusion in the $75,000 threshold of 28 U.S.C. § 1332. (Docket 19
12

at pp. 20-22). For purposes of plaintiffs’ objection, Mr. Oakies’ and Mr.
Hansen’s future medical expenses are anticipated to be $42,426 and $74,346,
respectively. There was no evidence presented as to the present value of these
future benefits. See Docket 19 at p. 6 (“[w]here the heart of a cause of action is
a claim for future benefits, the amount in controversy is the present value of the
claimed future benefit.”) (quoting Burns v. Mass. Mut. Life Ins. Co., 820 F.2d
246, 249 (8th Cir. 1987)). Once a plaintiff is released from prison, DOC would
no longer be statutorily obligated to pay for future medical care.
The magistrate judge recognized it was important for resolution of the
issue whether “any of the plaintiffs were likely to be released from prison anytime
in the near future.” Id. at p. 20. Plaintiffs did not provide the magistrate judge
with any information concerning “whether these men are likely to still be inmates
of the DOC at the time of their future surgeries . . . .” Id. Because plaintiffs
failed to provide this information to the court, the magistrate judge properly
concluded the plaintiffs’ silence was “indicative of the fact that plaintiffs will
likely continue to be in the custody of the DOC at the time of their future
surgeries.” Id.
Plaintiffs’ objections to the report’s conclusions concerning future medical
expenses are the same arguments presented in opposition to the application of
the collateral source rule for past medical expenses. (Docket 20 ¶ 10).
Plaintiffs have not argued one or more of them will be released and no longer in
DOC custody at the time of the anticipated future medical procedures so that
the collateral source rule could not apply.
13

The court finds the magistrate judge properly resolved the issue of future
medical expenses. Plaintiffs’ objection is overruled.
In summary, the court finds the magistrate judge properly evaluated and
applied the law on damages qualified for consideration in meeting the $75,000
damages threshold under 28 U.S.C. § 1332. The court adopts the conclusions
of law as stated in the report and recommendation of the magistrate judge.
Plaintiffs have not shown by a preponderance of the evidence that the court has
diversity jurisdiction under § 1332.
ORDER
Based on the above analysis, it is hereby
ORDERED that plaintiffs’ objections (Docket 20) to the report and
recommendation are overruled.
IT IS FURTHER ORDERED that the report and recommendation
(Docket 19) is adopted as amended above.
IT IS FURTHER ORDERED that defendant’s motion to dismiss (Docket 8)
is granted.
IT IS FURTHER ORDERED that plaintiffs’ complaint (Docket 8) is
dismissed without prejudice.
Dated March 23, 2015.
BY THE COURT:
/s/ Jeffrey L. Viken
JEFFREY L. VIKEN
CHIEF JUDGE

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