Oregon HCV Class Action Settled; Limitations Period
for Individual Damages Actions Tolled

by Mark Wilson

On April 6, 2004, the Class Action suit against the Oregon Department of Corrections (ODOC) for failing to properly diagnose and treat the hepatitis C virus (HCV), was resolved by entry of a comprehensive settlement.

The Action

As previously reported, in 2001, Oregon prisoners brought suit in federal court, alleging ODOC had written "and de facto , `as applied' policies of...delay and denial of...proper diagnosis and treatment of" HCV. Plaintiffs alleged violations of their constitutional rights, the Americans with Disabilities Act of 1990, and state law torts.

On December 19, 2002, the Honorable Anna Brown certified the action as a class action "for declaratory and injunctive relief only "pursuant to FRCP 23(b)(2). [ PLN , Aug. 2003].

Beginning September 2003, the parties entered into extensive settlement negotiations, overseen by United States District Judge Donald Ashmanskas. Negotiations occurred on numerous occasions over the course of seven months, culminating in the April 6, 2004 agreement. The major terms of the agreement include:

Stay of Action

The parties stipulated to the immediate stay of the action, as the terms of the agreement are carried out.

Appointment of Special Master

Judge Ashmanskas was appointed as Special Master for oversight and administration of the agreement.

Creation of Medical Review Panel

The parties agreed to the creation of a three-member Medical Review Panel (MRP) comprised of experts in Hepatology, Gastroenterology and public health administration, from Oregon Health Sciences University.

The MRP was charged with a two-part review of the diagnosis and treatment of HCV infected ODOC prisoners, including a review and potential modification of ODOC's written HCV guidelines followed by an 18-month random medical chart review of 100 class members.

The MRP was empanelled as a judicial body, precluding any ex parte communications. The MRP's final reports in both phases of its review are public records, having "the effect of noting compliance with the Guidelines and the medical standard of care."

If the "report finds noncompliance with the Guidelines or the medical standard of care, that finding can be used as a basis, upon motion of Plaintiff Class, to extend the review period of one six-month interval. Additionally, "the final report of the MRP can be used in any...subsequent proceeding, if otherwise admissible."

Any disputes concerning the activities of the MRP or the enactment of any of its recommendations shall be brought to Judge Ashmanskas. He will "make a determination on the dispute and shall issue findings." Those findings shall "then be referred to Judge Anna Brown for the issuance of an order mandating defendant to implement the changes, modifications and revisions as appropriate." Judge Brown's ruling shall be final.

Phase I Review

Phase I of the MRP review began April 6, 2004. In this place the MRP was asked to evaluate ODOC's written HCV guidelines for compliance with the community standard of care for the diagnosis and treatment of HCV. The MRP was also asked to address specific concerns raised by the Plaintiff Class, and to make recommendations concerning the modification of ODOC's written guidelines "and health care delivery system, if appropriate." [See sidebar].

Phase II Review

Upon completion of the Guidelines Review, "the MRP shall commence an 18 month chart review of no more than 100 medical charts of class members." In this phase, "[t]he parties shall [randomly] select up to 50 charts from the general group of HCV infected patients" within ODOC and Plaintiff databases. Additionally, "the MRP may at its sole discretion conduct a review of 50 additional medical charts selected from particular categories of treatment criteria, including, without limitations, those selected based on specific medical condition, treatment factors, or population characteristics. The MRP may, in its discretion, select any particular category and method of random chart selection it feels will best accomplish the task."

The MRP is authorized to speak personally with any medical staff, patient or other individual "necessary to conduct a proper review of the medical treatment of the discrete patient. The MRP may...seek information from Plaintiff Class counsel on particularized issues or charts for review." Moreover, "Plaintiff Class, by and through counsel, may supplement the selected 100 charts with any information including Kites and Kite responses."

The purpose of this review is "to assess the compliance of the treatment utilized for the specific patient with the existing Guidelines and the medical standard of care. If the MRP finds the treatment utilized for the specific patient violates the Guidelines or the medical standard of care it shall make recommendations for any changes needed[.]"

Final Agreement

Upon completion of both phases of the MRP's review and the issuance of its final reports, "the parties shall in good faith negotiate a final agreement which, if executed, obligates the Department to implement all or part of the MRP's recommendations or alternative measures that are within the MRP's scope and are mutually acceptable to the parties. This Agreement shall be submitted to Judge[s] Ashmanskas and...Brown for review and the issuance of a final order[.]" The parties shall then "execute and file a stipulated judgment of dismissal[.]"

Subsequent Damages Proceedings

"[S]ubsequent proceedings by individual class members may be filed...concerning individual damage claims. Th[e] agreement does not bar individual class members from seeking all available rights and remedies in their individual cases."

Tolling Agreement

"Defendants agree[d] to toll the applicable statute of limitations for [bringing individual damages actions] for all class members...for two years from the date of the dismissal of this action,...on two years from the time the individual knew or reasonably should have known of any injury arising from the actions of any potential Defendant and the date putative Plaintiff identified the Defendant responsible for injuries."

Dismissal of the action is contingent upon the MRP's completion of its work, which will not occur until June 30, 2006, at the earliest. Assuming, the action is resolved on that date, individuals who know or reasonably should know they have been harmed by the ODOC will have two years from the date of dismissal to file a damages action (i.e., until June 29, 2008). The two year clock will not begin to tick for other class members until they know or reasonably should know they were harmed. It is important to note, however, that at this point it is not known exactly when the action will be dismissed.

Fees and Costs

In the interest of settling the action, Class Counsel cut her fee significantly. Although she had more than $300,000 invested in the three-year litigation, she agreed to accept just $175,000 in fees, costs and disbursements.

"Class counsel shall also be entitled to recover fees for subsequent work during the pendancy of the case at a rate of two hundred dollars ($200) per hour up to a maximum of fifty (50) hours per year and a maximum of two thousand dollars ($2,000) in expenses per year for no more than two years." This brings the total fee awarded to $199,000.

Additionally, "[t]he members of the MRP shall be compensated [at a rate of $500 per hour] by the State of Oregon pursuant to individual service contracts with the State. "Other, unspecified costs incurred by the State in relation to the agreement include, but are not limited to: providing substance abuse treatment to all HCV-infected prisoners who need it, specialist referrals, use of pegylated rather than regular interferon, and providing liver biopsies and treatment to an increasing number of HCV-infected prisoners. [See companion story].

No Admission of Liability

ODOC "and the individual defendant expressly den[ied] any and all liability or fault" and the agreement "does not constitute any admission of legal liability or fault...nor any admission that the Guidelines are or ever have been constitutionally or medically deficient."

Notice of Settlement

ODOC agreed to "place notices of the settlement...in all [ODOC facilities] until the case is dismissed." Those mutually agreed upon notices shall "contain at a minimum,...the overview of the major settlement terms, the rights of individual class members to pursue individual damage claims, the applicable dates of the settlement agreement, the relevant tolling agreement and the contact information for class counsel." The notices are to be posted in English and Spanish in every living quarters and infirmary of each ODOC facility, and the "notices shall be run in each newsletter of each [prison] at least once monthly." Not surprisingly, however, ODOC has routinely failed to comply with this term of the agreement since the effective date.

The number of HCV-infected prisoners receiving evaluation and treatment by ODOC has sharply increased since the case was settled. Additionally, the MRP recently completed a major re-write of the ODOC's HCV Guidelines, [See sidebar].

PLN will continue to report significant developments in the settlement process, subsequent damages actions and ODOC's treatment of HCV. See: Anstett v. State of Oregon, USDC D OR, Case No: O1-CV-1619-BR.

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