Neter-Nu v. Methodist Hospital: Capping Hospital Exposure Beyond Conceded Agents and Resetting Pre-Judgment Interest under Indiana’s Medical Malpractice Act

Introduction

In Zainab Abbas, M.D., et al. v. Hetep Bilal Neter-Nu, the Indiana Supreme Court addressed a catalogue of trial-management issues that emerge frequently in medical-malpractice litigation: (1) the evidentiary foundation required to send a claim of direct or expanded vicarious hospital liability to a jury; (2) when omission of a superseding cause instruction constitutes reversible error; (3) the admissibility of “habit” evidence drawn from a patient’s prior medical records; (4) the proper use of writings to refresh a witness’s recollection or impeach an expert; and (5) allocation of prejudgment interest within the statutory cap regime of Indiana’s Medical Malpractice Act (MMA).

Although the Court affirmed an $11 million jury verdict (statutorily reduced to $1.25 million) in favor of the patient, it simultaneously:

• Vacated the trial court’s denial of the hospital’s Rule 50(A) motion as to any liability beyond the conceded negligence of the attending physician and nurse; and
• Ordered recalculation of prejudgment interest to reflect the cap-controlled monetary responsibility of each provider.

The decision thus announces a clear rule: “Where a hospital stipulates that an employee acted within the scope of employment, it cannot be sent to the jury on alternative theories of direct negligence or vicarious liability for unnamed agents absent expert testimony establishing a separate breach.”

Summary of the Judgment

• The plaintiff, a truck driver whose IV infiltrated after placement in his foot, underwent a below-the-knee amputation three weeks later.
• A Lake County jury rendered an $11 million verdict against Dr. Abbas, Nurse Mittler, and Methodist Hospital.
• The Court of Appeals reversed for a new trial, citing instructional and evidentiary errors.
• The Supreme Court granted transfer, reinstated the liability verdict, but:

• Held the trial court erred by denying Methodist’s Rule 50(A) motion and by instructing the jury it could find Methodist liable for the acts of “any other” employees.
• Found the error harmless because Indiana medical-malpractice defendants are jointly and severally liable; therefore the damages quantum was unaffected.
• Upheld the refusal to give a superseding-cause or hindsight instruction, concluding existing pattern instructions on proximate cause and standard of care sufficed.
• Affirmed exclusion of prior medical records as impermissible character (not habit) evidence and exclusion of an e-mail triable only after proper foundation for refreshing memory or impeachment.
• Remanded solely to recalculate prejudgment interest at 8 % on $500,000 (two $250 k layers), not on $250 k, corresponding to each statutory layer of liability.

Analysis

A. Precedents Cited and Their Influence

• Community Health Network, Inc. v. McKenzie, 185 N.E.3d 368 (Ind. 2022)
  – Reaffirmed that hospitals may be directly liable for negligent training, supervision, retention, or vicariously liable for acts of employees. Neter-Nu clarifies that negligent-supervision theories vanish once the hospital concedes agency and scope.
• Pettigrew line (Emergency Physicians of Indianapolis v. Pettit, 718 N.E.2d 753) and Cahoon v. Cummings, 734 N.E.2d 535 (Ind. 2000)
  – These cases obligate each health-care provider to pay prejudgment interest on its own capped exposure. Neter-Nu applies that principle where a hospital’s liability is derivative of two different agents.
• Control Techniques, Inc. v. Johnson, 762 N.E.2d 104 (Ind. 2002)
  – Held that standard proximate-cause instructions subsume superseding-cause concepts. The Court uses the same rationale to dismiss the request for a separate superseding-cause instruction in malpractice cases governed by contributory negligence.
• Wilson v. Lawless, 64 N.E.3d 838 (Ind. Ct. App. 2016)
  – Provided the modern Indiana test for an unforeseeable intervening act. Neter-Nu applies it and finds no evidence to justify the instruction.
• Thompson v. Boggs, 33 F.3d 847 (7th Cir. 1994) & Lewis v. State, 34 N.E.3d 240 (Ind. 2015)
  – Federal and state authorities defining “habit” as semi-automatic conduct. The Court adopts that benchmark to bar the patient-misconduct records.

B. Legal Reasoning of the Court

1. Directed-Verdict (Rule 50(A)) Error & Hospital Liability
   • The plaintiff offered no expert testimony addressing the conduct of unnamed nurses or physicians beyond Abbas and Mittler.
   • Absent “common-knowledge” negligence, expert testimony is indispensable.
   • Therefore, Methodist was entitled to judgment as a matter of law on theories other than liability derivative of Abbas and Mittler.
   • Nevertheless, reversal was unnecessary because joint-and-several liability ensured the verdict amount would be identical.
2. Superseding-Cause Instruction
   • The requested instruction was speculative; no evidence showed earlier intervention would have salvaged the limb.
   • Pattern proximate-cause language (“natural, probable, and foreseeable result”) already captured the foreseeability limitation.
3. Hindsight Instruction
   • The Court followed Carter v. Robinson: instructing the jury to measure conduct against what a reasonable provider would do “under the same or similar circumstances” necessarily forbids hindsight.
4. Evidentiary Rulings
   • Prior hospital records: Not habit (frequency unknown), thus barred by Rule 404(b); any probative value outweighed by unfair-prejudice risk.
   • Expert e-mail: Foundation defective for Rule 612; impeachment use also failed because counsel did not elicit an inconsistent in-court statement before tendering the document.
5. Prejudgment Interest
   • Trial court correctly awarded interest but used the wrong principal.
   • Statutory layer analysis: Abbas+Methodist = $250 k, Mittler+Methodist = $250 k ⇒ interest should be calculated on $500 k.

C. Potential Impact of the Decision

• Hospital Litigation Strategy
  Hospitals may now safely stipulate that the alleged tortfeasor was an employee without opening themselves to additional negligent-supervision theories—unless plaintiffs marshal expert testimony supporting a separate breach.
• Trial Instructions in Medical-Malpractice Cases
  Judges will likely refuse standalone superseding-cause or hindsight instructions where the Indiana Model Civil Instructions on causation and standard of care are given, cutting down on “battle-of-the-instructions” disputes.
• Evidence of Patient Conduct
  The holding draws a bright line between “habit” and “prior bad acts” in the medical context, signaling trial courts to scrutinize frequency data before admitting prior-medical-record evidence of patient behavior.
• Prejudgment Interest Calculation
  By tethering interest to each $250 k statutory layer, Neter-Nu prevents plaintiffs from leveraging joint-and-several liability to inflate prejudgment interest, ensuring that providers do not pay interest on sums ultimately borne by the Patient Compensation Fund.

Complex Concepts Simplified

• Vicarious Liability vs. Direct Liability
  • Vicarious: An employer (hospital) is responsible for negligent acts of an employee acting within job scope.
  • Direct: The hospital itself breaches a duty—e.g., poor hiring, training, or supervision.
• Joint and Several Liability
  Each defendant can be compelled to pay the entire judgment; any one of them is on the hook for the full amount, leaving contribution disputes for later.
• Superseding Cause
  An unforeseeable, independent event that interrupts the chain of causation and absolves the original wrong-doer.
• Habit Evidence (Rule 406)
  Requires a semi-automatic pattern—proof that a person almost always reacts the same way in the same situation.
• Rule 612 (Refreshing Recollection)
  Counsel may show a witness a document only after the witness says, “I don’t remember.” If the witness already recalls, there is nothing to refresh.
• MMA Damage Caps
  For malpractice occurring before July 1 2017: a patient may recover up to $250 k from each provider (up to $1 million in total provider exposure), with any excess paid by the Patient Compensation Fund.

Conclusion

The Indiana Supreme Court has fine-tuned several doctrinal levers in Neter-Nu v. Methodist Hospital. The case is most consequential for its firm boundary on hospital exposure: no expert testimony, no extra theories of liability. It also reaffirms that pattern instructions on causation and standard of care generally eclipse special requests on superseding cause and hindsight. On the evidentiary front, “habit” retains a stringent definition that will seldom encompass a patient’s sporadic prior misconduct. Finally, the Court harmonizes prejudgment-interest awards with the MMA’s layered cap architecture, preventing over-collection from individual providers. Together, these holdings supply clear trial-management rules for litigants and trial courts in Indiana’s medical-malpractice arena, promoting efficient, focused jury deliberations and cap-consistent post-verdict accounting.