May 1, 2015 –

Court of Appeal Affirm’s Ted Mathew’s $5.7 Million Jury Verdict For Intentional Infliction of Emotional Distress

Today, the California Court of Appeal reversed a trial court ruling and reinstated a $5.7 Million jury verdict that Charles “Ted” Mathews obtained on behalf  Dr. Michael W. Fitzgibbons.  Commenting about this victory, Andrew H. Friedman of Helmer Friedman LLP, said “Ted’s victory today exemplifies why we wanted him to join our law firm. We think that Ted is one of the premier trial attorneys on the West Coast and we could not be happier that he is working with us.”

Mr. Mathews’ client, Dr.  Fitzgibbons, sued his former employer, Integrated Healthcare Holdings, Inc. (“IHHI”), for intentional infliction of emotional distress based on the conduct of IHHI’s chief executive officer (“CEO”).  At trial, the jury impliedly found that IHHI’s CEO carried out his threat to “humble” Dr. Fitzgibbons by having him arrested after arranging for a loaded handgun to be planted in his car. The jury also impliedly found the CEO caused Dr. Fitzgibbons’s daughter to be in a serious auto accident after one of her tires was slashed. The CEO retaliated against Dr. Fitzgibbons to punish him for his outspoken opposition to IHHI’s acquisition of the hospital where Dr. Fitzgibbons had just completed a term as chief of staff, and also Dr. Fitzgibbons’s success in an earlier lawsuit that resulted in a $150,000 attorneys fee award against IHHI.  Accordingly, the jury found in favor of Dr. Fitzgibbons and awarded him $5.7 million in compensatory and punitive damages on his intentional infliction of emotional distress claim against IHHI.

Following the trial, the trial court granted IHHI’s motion for a judgment notwithstanding the verdict because it found IHHI was not vicariously liable for its CEO’s misconduct under the respondeat superior doctrine. According to the trial court, the CEO acted outside the scope of his employment because he held a personal grudge against Fitzgibbons and therefore his conduct was not reasonably foreseeable.

The Court of Appeal reversed and reinstated the jury’s verdict because foreseeability of the CEO’s conduct is not the exclusive test for determining the employer’s vicarious liability for an employee’s torts. An employee also acts within the scope of employment when his or her tort is engendered by or arises from a dispute that relates to the employer’s business. Substantial evidence supports the jury’s implied finding the CEO retaliated against Dr. Fitzgibbons based on a dispute relating to IHHI’s acquisition and operation of the hospital, and the trial court’s finding the CEO acted out of a personal grudge impermissibly supplants the jury’s determination on the weight and credibility of the evidence.

The Court of Appeal decision can be found here.