Free Response in Opposition to Motion - District Court of Arizona - Arizona

1 STEPTOE & JOHNSON LLP
2 Collier Center
201 East Washington Street i
3 Suite 1600
Phoenix, Arizona 85004-2382
4 Telephone: (602) 257-5200
5 Facsimile: (602) 257-5299
6 Karl M. Tilleman (013435)
P. Bruce Converse (005868)
7 Janice K. Crawford (019042)
8 Attorneys for Plaintiff
9
1() UNITED STATES DISTRICT COURT
11 DISTRICT OF ARIZONA
12 Northland Insurance Company, a Minnesota
corporation, No. CV 04-347 PHX-FJM
13
Plaintiff,
14 NORTHLAND INSURANCE
vs. COlVIPANY’S
15 RESPONSE TO DEFENDANTS
Correctional Medical Services, Inc., a MOTION IN LIMINE
16 Missouri corporation, Dr. Antonio DiMaano,
Dr. Reynaldo Figueroa, Nurse Lorraine
17 Lopez-Moreno, Nurse Trina Carrasco, Nurse
Jacqueline Cornwell, and ABC Insurance
18 Company,
19 Defendants.
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case 2;04-cv-00347-FJM Document 147 Filed O3/O1/2006 Pa`§°é‘ i"?>2r9$r5 “"

1 Evidence of the sub—standard medical care provided to Mr. Valdez by the CMS
2 nurses is relevant and admissible to prove (indeed it is highly prolbative of) CMS’s motive
3 for the commission of fraud when it failed to notify PHICO of CSC’s tender of the defense
4 of the Valdez case and in concealing the material fact that PHICO did not have a record of
5 CSC being named as an additional insured as required by the Health Services Agreement.
6 CMS’s relevance and prejudice arguments do not overcome this highly probative use of
7 this evidence.
8 Evidence is relevant if it has "any tendency to make the existence of any fact that is
9 of consequence to the determination of the action more probable or less probable." Fed.
10 R. Evid. 402. The evidence concerning CMS medical care is necessary to the fact finder’s
ll understanding of the reasons why CSC looked to CMS for coverage in connection with the
12 underlying lawsuits. Without some evidence that CSC justifiably and reasonably looked
13 to CMS, the fact finder will not understand the actions of the parties: in short, it is an
14 inseparable part of the overall story the fact finder must understand in this case. In order
15 to prove fraud, Northland will demonstrate, among other things, that the representations by
16 CMS about the existence of coverage for CSC under the PHICO policy and its status as an
17 specifically named additional insured were fraudulent, material, CMS knew they were
18 false, and CMS intended that CSC rely and CSC did, in fact, rely on those representations.
19 Ec/10ls v. Beauty Built Homes, Inc., 132 Ariz. 498, 647 P.2d 629 (1982). Underlying each
20 of these elements of proof is the overarching question as to why CMS would want to
21 mislead CSC in the first instance. In order for the factfinder to conclude that the
22 representations were fraudulent, material, and false, Northland must be able to present
23 evidence of the conduct of the CMS nurses to demonstrate to the jury why CMS would
24 willfully engage in conduct that would delay or deny CSC coverage under the PHICO
25 policy. U.S. v. Miller, 874 F.2d 1255, 1269 (9th Cir. 1989) ("[I]f a person commits a
26 second [wrong] in order to cover up the first, proof of the first [wrong] may be used to
case 2;04-cv-00347-FJM Document 1472 Filed O3/O1/2006 P§§%#é95?2Z“·‘

1 show motive for the second even though the [acts] are dissimilar."). The evidence of
2 CMS’s inexcusable medical negligence relative to Mr. Valdez goes to the heart of
3 Northland’s fraud case, and exclusion of this evidence would severely prejudice Northland
4 in its ability to demonstrate to the jury why CMS wanted to avoid taking responsibility for
5 the actions of its nurses that, at least ir1 part, resulted in a $5 million jury verdict.
6 Evidence may only be excluded under Rule 403 if the "probative value [of the
7 evidence] is substantially outweighed by the danger of unfair prejudice." Fed. R. Evid.
8 403 (emphasis added). "‘Unfair prejudice’ within its context means an undue tendency to
9 suggest decision on an improper basis, commonly, though not necessarily, an emotional
10 one." Fed. Rule Evid. 403, Advisory Committee Note. Northland’s intended use of the
11 evidence of the CMS nurses’ medical negligence is a wholly proper basis, as it is directly
12 connected to the fraud that followed it and, consistent with Northland’s theory of the case,
13 was the precipitating cause of the fraud. There is no inherent unfairness and impropriety
14 in such a use of this evidence and any possible prejudice cannot substantially outweigh
15 that legitimate use.
16 DATED this lst day of March 2006.
17
18 STEPTOE & JOHNSON LLP
19
By /s/
20 Karl M. Tilleman
P. Bruce Converse
21 Janice K. Crawford
Collier Center
22 201 East Washington Street
Suite 1600
23 Phoenix, Arizona 85004-2382
24 Attorneys for Plaintiff
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1 CERTIFICATE OF SERVICE
I hereby certify that on the lst day of March 2006, I caused the attached document
2 to be electronically transmitted to the Clerk’s Office using the CM/ECF System for filing
3 and transmittal of a Notice of Electronic Filing to the following CM/ECF Registrants:
Stefahen Paul Forrest, Esquire
4 Ho loway Odegard Forrest Kelly & Kasparek
3101 North Central Avenue, Suite 1200
5 Phoenix, Arizona 85012
Attomeys for Defendants
6 Correctional Medical Services, Inc.,
Lorraine Lopez-Moreno, Trina Carrasco, and
7 Jacqueline Cornwell
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9 STEPTOE & JOHNSON LLP
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By /s/
I 1 Karl M. Tilleman
P. Bruce Converse
12 Janice K. Crawford
201 East Washington, Suite 1600
13 Phoenix, Arizona 85004
14 Attorneys for Defendant
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