UHS to challenge $535M verdict in negligence lawsuit

A jury ordered a subsidiary of Universal Health Services to pay $535 million in damages in a negligence case. 

In an April 1 regulatory filing, King of Prussia, Pa.-based Universal Health Services said Pavilion Behavioral Health Services, its indirect subsidiary, would contest the ruling. 

On March 28, a jury ruled that negligence on the part of Champaign, Ill.-based Pavilion Behavioral Health Services was the proximate cause of the rape of a 13-year-old patient by another patient, according The News-Gazette. The jury awarded $60 million in compensatory damages to the plaintiff, the victim's mother, and $475 million in punitive damages, UHS said in its SEC filing. 

The health system called the verdict "unprecedented" for single-plaintiff injury cases in Champaign County, Ill., and said the Pavilion is evaluating all legal options to challenge the jury's decision. 

"We can make no assurances regarding the ultimate outcome of the case or what damages will ultimately be awarded," the system wrote in its filing. "While the Pavilion has professional liability insurance to cover a portion of these amounts, the final resolution of this case may have a material adverse effect on the company." 

Attorneys for the plaintiff alleged Pavilion Behavioral Health was negligent by failing to safely house patients, provide adequate staffing or properly monitor its adolescent floor, the News-Gazette reported. Pavilion Behavioral Health operates a 122-bed inpatient facility, offering treatment to children and adults. 

"We hope this leads to a culture change in mental-health facilities to make sure that these vulnerable children are protected," an attorney for the plaintiffs told the News-Gazette. 

Another large behavioral health provider, Acadia Healthcare, paid $400 million in October to settle three cases alleging a nonprofit operated by a now-shuttered New Mexico facility placed children in a foster care setting where they were repeatedly sexually abused. 

Mike Prangle, the lead attorney for Pavilion Behavioral Health System in the case, said the system was "shocked and dismayed by this unconscionable and excessive verdict." 

"We respectfully disagree with the jury's verdict," Mr. Prangle told Becker's. "The Pavilion intends to challenge this verdict through post-trial motions and, if necessary, appeals. While we do not diminish the experience and feelings of the plaintiff, we anticipate this excessive verdict will be remediated. The Pavilion has been serving its patients and the central Illinois community for decades." 

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