Indiana Appellate Case Reporter
Editors:
James P. Barth, Esq.
Pfeifer Morgan & Stesiak
Lindsay N. Popejoy
The Cline Law Firm, LLC
June 3rd, 2022
Cases included in this issue are from April 2022
INDIANA SUPREME COURT

Indiana Medical Malpractice Act did not apply to employee’s improper access and disclosure of information from patient medical records maintained by health care provider; An employee’s conduct may fall within the scope of employment even though it is unauthorized and violates an agreed-to policy; the Supreme Court explicitly recognized the viability of an invasion-of-privacy tort claim based on the public disclosure of private facts.
 
 
Katrina Gray (“Gray”), a medical records coordinator employed by Community Health Network (“Community Health”), improperly accessed and disclosed confidential medical records of several individuals, including the medical records of the plaintiffs and their family members. The plaintiffs filed a complaint for damages against Gray and Community Health. They brought claims of respondeat superior and negligent training, supervision, and retention against Community Health and claims of negligence and invasion of privacy against Gray.
 
Community Health filed a motion to dismiss for lack of subject matter jurisdiction and a motion for summary judgment with the trial court. Community Health argued that the trial court lacked subject matter jurisdiction over the case, because the Indiana Medical Malpractice Act applied to the claim and the plaintiffs had failed to satisfy the requirements of the MMA. In the alternative, Community Health argued that it was entitled to summary judgment because Gray was not acting within the scope of her employment when she committed her tortious acts, because the Plaintiffs lacked cognizable damages, and because the claims against Gray were not actionable under Indiana law.
 
The trial court held that the MMA did not apply to the plaintiffs’ lawsuit, because the plaintiffs were not patients of the medical practice at which Gray worked when she accessed their medical records. Thus, the trial court denied Community Health’s motion to dismiss. The court also held that there were unresolved factual questions regarding whether Gray’s conduct was within the scope of her employment, whether the plaintiffs had sustained actual damages, and whether Gray had publicly disclosed information from the medical records at issue. The trial court denied Community Health’s motion for summary judgment.
 
In a permissive interlocutory appeal, the Court of Appeals affirmed the trial court’s denial of Community Health’s motion to dismiss and affirmed the trial court’s denial of summary judgment except for the plaintiffs’ invasion-of-privacy claim. The Court of Appeals held that Community Health was entitled to judgment as a matter of law because the tort at issue, public disclosure of private of facts, was not recognized in Indiana. Community Health sought transfer, which was granted.
 
To determine whether Community Health was liable for the conduct of Gray, the Supreme Court was required to address several issues: (1) the applicability of Indiana’s Medical Malpractice Act to the Plaintiffs’ claims; (2) the proper scope-of-employment inquiry; (3) the availability of emotional distress damages in negligence-based claims; and (4) the viability of an invasion-of-privacy claim for the public disclosure of private facts.
 
First, the Supreme Court held that the Indiana Medical Malpractice Act did not apply to the plaintiffs’ claims against Community Health. The court noted that, for the MMA to apply to the conduct of a health care provider, such conduct has to be based on “health care” or “professional services.” The court noted that “health care” is defined an act or treatment performed, or that should have been performed, by a health care provider during a patient’s medical care, treatment, or confinement. Because neither the plaintiffs nor Community Health alleged or showed such a connection, the court determined that the actions of Gray were not “health care.” The court then looked to whether Gray’s unauthorized access of the plaintiffs’ medical records qualified as “professional services.” The court determined that Community Health’s internal business decisions and access protocols for medical records are not professional medical services provided to a patient. The court concluded that such protocols and procedures are neither conduct related to the promotion of a patient’s health, nor do they require the exercise of a health care provider’s professional expertise, skill, or judgment.
 
Second, the Supreme Court held that there were genuine issues of material fact on the scope-of-employment issue in this case. The Court noted that an employee’s conduct might fall within the scope of employment even though it is unauthorized and violates an agreed-to policy. The court noted that scope of employment could include acts that naturally or predictably arise from authorized activities. Thus, scope-of-employment liability may reach unauthorized conduct, including that which violates the employer’s rules, orders, or instructions. However, the Court also noted that, if an employee engages in unauthorized conduct that is in direct violation of agreed-to policies and procedures, then such evidence weighs heavily toward a finding that the actions were outside the scope of employment. The Court ultimately held that the designated evidence in the case raised questions of facts as to whether Gray’s unauthorized access of the plaintiffs’ medical records arose naturally or predictably from her unrestricted access to the records of all Community Health patients. The Court reached that decision based upon Community Health’s complete control over Gray’s access to patient records, Gray’s lack of understanding regarding the scope of that access, and Community Health’s failure to identify the misconduct. Consequently, the Court noted that the plaintiffs’ alternative theories of negligent training, supervision, and retention and the doctrine of respondeat superior could survive summary judgment.
 
Third, the Supreme Court held that Community Health was entitled to summary judgment on both of the plaintiffs’ negligence-based claims, because the undisputed facts demonstrated a lack of compensable damages. The plaintiffs’ asserted that they had suffered fear, anxiety, and sadness (emotional distress) as a result of Gray’s unauthorized access and disclosure of their private medical records. However, the Court also noted that the plaintiffs could not satisfy the modified impact rule or the bystander rule necessary for recovery of emotional distress damages in a negligence-based claim.
            
Finally, the Supreme Court held that Indiana recognizes a tort claim for the disclosure of private facts, but the undisputed evidence in this particular case negated the tort’s publicity element. The Court explicitly adopted the disclosure tort as it is articulated in the Restatement (Second) of Torts §652D, which establishes four requirements: (1) the information disclosed must be private in nature; (2) the disclosure must be made to the public; (3) the disclosure must be one that would be highly offensive to a reasonable person; and (4) the information disclosed is not of legitimate public concern. The Court determined that Community Health was entitled to summary judgment on the plaintiffs’ claim for respondeat superior liability premised on Gray’s alleged public disclosure of private facts, because the record was devoid of any evidence that Gray disclosed the information contained with the plaintiffs’ medical records to, or in any way that was sure to reach, the public or a large number of people.
 
The Court affirmed the trial court’s denial of Community Health’s motion to dismiss for lack of subject-matter jurisdiction because the plaintiffs’ claims were not subject to the MMA. The Court reversed the denial of Community Health’s motion for summary judgment because Community Health affirmatively negated a required element of each of the claims against it. The case was remanded to the trial court with instructions to enter judgment in favor of Community Health on all claims. 
INDIANA COURT OF APPEALS

Claims for negligent supervision cannot be considered a separate cause of action capable of eluding an analysis under Pfenning v. Lineman.

 
In early 2019, plaintiff Isabella Reynolds, who had been a "flyer" for the Harrison high school junior varsity cheerleading squad and cheerleader for about 4 years, was asked to fill in on the varsity cheerleading squad by the cheerleading coach. The cheerleading coach oversaw several practices before determining that the team, including Reynolds, was ready to perform. On the night of the performance, the coach was present and observed the team warm-up. However as the team was completing its run through, Reynolds'teammates failed to catch her and she fell onto the gymnasiums floor breaking her jaw and most of her teeth.
Plaintiff filed a complaint against the school alleging that they failed to inspect and discovery dangerous activity, worn Reynolds of it dangerous activity, provide proper supervision, and correct the dangerous condition or activity. In response following discovery, the school filed a motion for summary judgment and the trial court granted summary judgment on all claims except failure to provide proper supervision. The school filed a motion to reconsider and argued that under Indiana law it was entitled to judgment on the negligent supervision claim or in the alternative the doctrine of incurred risk of barred Reynolds claim. The trial court denied summary judgment on the negligent supervision claim and found that Reynolds claim was not barred by the doctrine of incurred risk but certified its order for interrogatory appeal.
 
The Court of Appeals noted that in Pfenning v. Lineman, 947 N.E.2d 392, 403-04 (Ind. 2011), our Supreme Court established a limited new rule in regard to negligence claims “arising from ordinary sports activity.” Megenity v. Dunn, 68 N.E.3d 1080, 1082 (Ind. 2017). “[A]s a matter of law, when a sports participant injures someone while engaging in conduct ordinary in the sport—and without intent or recklessness—the participant does not breach a duty.” Id. “[U]nder Pfenning ordinary conduct in the sport turns on the sport generally—not the specific activity.” Id.

The Court of Appeals went on to note that in Megenity v. Dunn, 68 N.E.3d 1080, 1082 (Ind. 2017), the court clarified the analysis needed to determine what is ordinary behavior and held that ordinary behavior for the purposes of the Pfenning rule turns on a general analysis of the sport and not an analysis of the specific activity. 68 N.E.3d at 1084. The court reasoned that a “broad, sport-centric focus makes sense[,]” as sports are “imprecise and physically intense” and participants “should not fear that judges will later armchair-quarterback their every movement.” Id. “After all, judges are more likely to have general sports knowledge than specific sports expertise.” Id.
 
In reviewing the record on appeal, the Court of Appeals determined that the designated evidence showed that cheerleaders were regularly hoisted into the air caused by their teammates and thus satisfied to the ordinary behavior element of the Pfenning analysis. However, the Court of Appeals noted that it would still address whether negligent supervision was a separate claim outside of the reach of Pfenning.
 
In Pfenning, the injured teenager also brought a claim against her grandfather for negligent supervision. The court declined to grant summary judgment as to the negligent supervision claim against the grandfather. Pfenning, 947 N.E.2d at 410. The court indicated that negligent supervision involves the well-recognized duty in tort law that persons entrusted with children and other individuals, whose characteristics make it likely that they may do unreasonable things, have a special responsibility recognized by the common law to supervise their charges. Id. The school argued that negligent supervision could not be a separate cause of action capable of surviving summary judgment under Pfenning and Megenity. Conversely, Reynolds argued that Pfenning expressly allows for a separate analysis of negligent supervision.
 
Because the routine the coach had the cheerleading squad perform was ordinary under a general analysis of the sport, the Court of Appeals determined that it could not separate out a coach's specific conduct related to supervision of the routine as a separate cause of action. The Court of Appeals reasoned Megenity provided that once an analysis of “ordinary” for the sport as a whole is conducted, then, if raised by a party, that same conduct is evaluated for recklessness and intent and both recklessness and intent consider a participant's individual actions and thought processes during the conduct that caused the injury. Therefore, the Court of Appeals reasoned that an analysis of a coach's individual actions related to supervising her athletes and the choices made therein were subsumed by a review of whether that coach was intentional or reckless in her conduct. The Court of Appeals declared that to hold otherwise would leave us without a framework for evaluating a negligent supervision claim against a participant. As a result, a claim for negligent supervision cannot be considered a separate cause of action capable of eluding an analysis under the Pfenning rule. Based on its findings, the Court of Appeals determined the trial court abused its discretion and reversed denial of the motion to reconsider as to the negligent supervision claim.

  
Incurred or assumed risk does not negate or relieve a defendant of any duty it may owe.

 
On November 28, 2009, the plaintiff, Seth Wiley, was attending a concert in Indianapolis. The concert venue had an audio message repeatedly playing during the evening events advising patrons in part, "please note: moshing and crowd surfing is strictly prohibited. Due to the nature of moshing/crowd surfing, injuries can occur. Patrons who engage in moshing and/or crowd surfing do so at their own risk and are subject to rejection from the venue." Despite warnings, various attendees, including Wiley who was a minor at the time, engaged in crowd surfing. The plaintiff engaged in crowd surfing 3 or 4 times prior to the final occasion when he was crowd surfing and fell on the floor, suffering injuries. On the prior crowd surfing occasions, defendant's personnel had helped him down to the ground when he reached the front of the audience. On the final time, defendant's personnel were otherwise occupied.
The plaintiff sued the venue along with the security company for negligence and the defendant filed a motion for summary judgment arguing that it did not owe a duty to the plaintiff and that plaintiff had incurred the risk of his injuries. The trial court entered summary judgment denying the motion for summary judgment on the issue of duty but granted summary judgment on the issue of incurred risk and entered a final judgment in defendant's favor. The plaintiff appealed.

The Court of Appeals noted that the plaintiff had designated evidence that defendant knew from prior experience with similar concerts that patrons would crowd surf despite written and audio warnings. Based on one defendant's experience it had recommended to the venue that two additional staff be positioned near the barricade at the front of the stage area that night. Upon its review, the Court of Appeals observed that the principle underlying decisions in many assumption of duty cases is the reluctance to impute broad definitions of duty that essentially render a party the guarantor of another's safety. With that consideration in mind, the Court of Appeals found that the record presented genuine issues of material fact as to whether the defendant assumed a duty of reasonable care to the plaintiff and those who crowd surfed at the concert.

The defendant argued that because plaintiff knew the risks and engaged in the activity despite such knowledge, plaintiff assumed the risk of his activities and any duty that was owed was thereby negated. The Court of Appeals reviewed Martin v. Hayduk, 91 N.E.3d 601 (Ind. Ct. App. 2017) and explained that under the Comparative Fault Act-which defines "fault" to include "unreasonable assumption of risk not constituting an enforceable express consent" and "incurred risk"-incurred risk cannot be a basis to find the absence of a duty except in the case of a plaintiff's express consent. Therefore, the Court of Appeals reversed the trial court's grant of summary judgment and remanded the matter for a jury to determine whether defendant had assumed a duty and for resolution of the remaining issues of breach, causation, and comparative fault.

 
Liability for an UIM insurance carrier that fails to obtain release of the hospital lien prior to issuing payment of its policy is only liable for the UIM policy limit and not the total charge of the hospital lien.

 
This was the second appeal in the lawsuit between Parkview Hospital and American family Insurance. The dispute was that American family insurance paid its $50,000 UIM policy limit to its insurance without obtaining a release for Parkview Hospital's hospital lien. This appeal dealt with whether the trial court had erred when it ordered American family insurance to pay Parkview the full amount of Parkview's hospital lien, $95,000 in addition to reasonable attorney fees. Trial court denied American family's motion to limit its liability to the $50,000 underinsured motorist policy limit.

Upon review of the appeal, the Court of Appeals determined that Parkview is not entitled to attorney fees under the hospital lien statute; and American family insurance had no obligation under the hospital lien statute to pay more than its underinsured policy limit toward Parkview's lien.

The Court of Appeals explained that National Insurance Association v. Park Memorial Hospital, 590 N.E.2d 1141 (Ind. Ct. App. 1992) did not address the hospital's claim for attorney fees under the hospital lien statutes, but rather was based on what is now Indiana Code Section 34–52–1–1 which provides for attorney fees where a party has brought an action that is frivolous unreasonable or groundless were his has litigated in bad faith.

The Court of Appeals also discussed how the lienholder damages provision of the hospital lien statute is not triggered when a patient recovers from his own underinsured coverage. The Court of Appeals noted that any amount obtained or recovered by the patient from an underinsured insurance carrier remained subject to the lien and the patient and his insurance company or liable up to and including the policy limits of that coverage should they fail to obtain a release of the lien. The Court of Appeals determined that when American family failed to comply with the statute it assumed the risk of having to pay the $50,000 policy limits twice but that the failure did not entitled Parkview to be placed in a better position than it would have been in had American family complied with the statute.

The Court of Appeals affirmed in part, reversed in part and remanded the case to the trial court for further proceedings.


Individual claims against separate defendants, even if they arise from the same incident, are not required to be litigated simultaneously and the prosecution of one does not preclude the other where the claims have legal basis.

 
On April 10, 2018 Davidson was a passenger in a semi truck that was involved in a crash with a bridge pier of an overpass. Davidson sent a tort claim notice to the state of Indiana and Indiana Department of Transportation alleging that her injuries were caused in part by their negligence stemming from road construction in the vicinity of the crash and the State denied her claim. In December 2018, Davidson filed a lawsuit against the employer of the semi truck driver and the owner of the trucking company. The following year, Davidson obtained a judgment in her favor against the driver's employer. A few months later, in March 2020, Davidson filed a lawsuit in Monroe County against the state of Indiana, Indiana Department of Transportation and other defendants for negligence surrounding the construction in the crash's vicinity. The defendants all filed dispositive motions under rule 12 and after a hearing on the motions, the trial court dismissed the complaint with prejudice. Davidson filed a motion to correct their which was also denied.

The plaintiff appealed arguing that the trial court erred in dismissing her complaint under the doctrine of collateral estoppel which operates to bar a subsequent litigation of the factory issue that was adjudicated in a former litigation. There are two categories of collateral estoppel—offensive and defensive. MicroVote Gen. Corp. v. Ind. Election Comm'n, 924 N.E.2d 184 (Ind. Ct. App. 2010). Collateral estoppel is offensive when a plaintiff seeks to foreclose a defendant from relitigating an issue the defendant has previously litigated unsuccessfully in an action with another party. Id. Similarly, the term defensive collateral estoppel has been used to describe the situation where a defendant seeks to prevent a plaintiff from asserting an issue that the plaintiff has previously litigated and lost against another defendant. Tofany v. NBS Imaging Sys., Inc., 616 N.E.2d 1034 (Ind. 1993) (citing Parklane Hosiery Co., Inc. v. Shore, 439 U.S. 322, 99 S. Ct. 645, 58 L. Ed. 2d 552 (1979)). Thus, “[i]n both the offensive and defensive use situations, the party against whom estoppel is asserted has litigated and lost in an earlier action.” Parklane Hosiery Co., 439 U.S. at 329, 99 S. Ct. at 650.

The Court of Appeals noted that the trial court found Davidson's claims to be collaterally estopped because the facts and issues in the case were determined in a previous action. However the Court of Appeals went on to note that while both actions arose from the same incident, each of the actions required proof of an actors negligence and liability that the other does not. The action against the driver's employer decided nothing with regard to the alleged negligence of the state and other defendants in this action. The Court of Appeals found that the issue of the defendant's negligence and liabilities had not been previously litigated and thus Davidson's claims against them were not precluded by collateral estoppel in this new action.

The Court of Appeals also noted that the trial court erred in determining that Davidson's lawsuit against the state constituted claim splitting. The trial court applied collateral estoppel, the issue preclusion branch of res judicata and claim splitting occurs in situations of claim preclusion where multiple suits are brought against the same defendant (or those in privity), not in circumstances of issue preclusion like we are addressing here. See State of Ind., Ind. State Highway Comm'n v. Speidel, 181 Ind. App. 448, 392 N.E.2d 1172 (1979) (“As to claim preclusion, a party is not allowed to split a cause of action, pursuing it in a piecemeal fashion and subjecting a defendant to needless multiple suits.”). Thus, the court's determination that Davidson was engaging in improper claim splitting by pursuing this action is error. Thus, the Court of Appeals reversed the trial court and remanded.


A motion to set aside judgment under Trial Rule 60 should have an explanation for a breakdown in communication to guide courts into finding excusable neglect and overturning a default judgment.

 
Plaintiff, Kickapoo contracted with BDX for hemp seeds to cultivate into plants. BDX retains the right to purchase the hemp plants based on the percentage of CBD the matured plants could produce. BDX received a shipment and determined the value for the hemp was $216,163.44 but never paid Kickapoo. Kickapoo filed a complaint against BDX for unjust enrichment, breach of contract, and conversion on November 5, 2020 and on the same day served the summons and complaint on BDX's registered agent. On December 7, 2020, Kickapoo filed a certificate of summons along with signed receipts for the certified mailing and 3 months later, after not receiving any response from BDX filed a motion for summary judgment. Motion for summary judgment was also served upon the registered agent. On March 26, 2021, having not received any responses, the trial court granted summary judgment to Kickapoo and sent a copy of the summary judgment order to the registered agents. On April 1, 2021, Kickapoo filed the motion for proceeding supplemental and served upon the registered agent, and the trial court issued an order to appear by certified mail to the registered agent. BDX failed to appear in the trial court issued a rule to show cause hearing for September 9, 2021, which was also served by certified mail to the registered agents.

In July 2021, BDX filed a motion to set aside the default judgment under trial rule 60 (B) (1) and in support claimed that it had not received any notice of the lawsuit from their registered agent. The trial court denied the motion to set aside after conducting a hearing and BDX filed an appeal.

The Court of Appeals noted that Indiana cases suggest that rather than the federal "willful ignorance" standard, in Indiana an excusable breakdown in communication requires a person affirmatively established that it did everything it needed to do to avoid such breakdown. The Court of Appeals analyzed Huntington Nat. Bank v. Car-X Assoc. Corp., 39 N.E.3d 652, 658 (Ind. 2015), in which our Supreme Court concluded that there was no excusable neglect for the defendant's failure to respond where in absence of the employee typically responsible for handling legal mail, another employee let the notice sit on his desk until the time to respond had passed.

The Court of Appeals noted that "[a] characterizing constant Indiana's precedents is the explanation provided for the breakdown in communication‑an explanation which guides the result in whether courts find excusable neglect and overturn a default judgment." BDX bore the burden of demonstrating it did everything that needed to be done and that it was Registered Agents who was responsible for the breakdown. See Car-X, 39 N.E.3d at 657-58. Any doubts about who is at fault are construed against the defaulted party, as it bears the risk of a communication breakdown between the registered agent and the defaulted company. Precision Erecting, Inc. v. Wokurka, 638 N.E.2d 472, 474 (Ind. Ct. App. 1994). Because BDX did not provide an explanation as to the nature or reason for the breakdown of communication between its registered agents and BDX, the Court of Appeals could not find excusable neglect and affirmed the trial court's judgment.

The Court of Appeals reminds us that summonses and notices for hearings are integral parts of due process that cannot be shirked.


On August 5 2020, the plaintiffs filed a complaint against the defendants regarding a remodeling project at their residence, but did not file or serve defendants with a summons. On October 23, 2020, the plaintiffs filed a motion for default judgment without notice to the defendants. The trial court entered judgment against the defendants on May 13, 2021.

The plaintiffs filed a motion for proceeding supplemental and a hearing was scheduled for September 1, 2021. Defendants filed a motion to continue the September 1, 2021 hearing, which was granted and rescheduled for September 16, 2021. Defendants also filed a motion to set aside the default judgment on September 15, 2021 because defendants did not receive a summons with the complaint, a copy of the motion for default judgment, and a motion for default judgment did not contain a certificate of service. The trial court conducted a hearing on the motion set aside default judgment instead of the proceeding supplemental without giving defendants notice and denied the motion to set aside default judgment. Defendants filed a motion to reconsider which was also denied and the defendants filed an appeal.

Court of Appeals reversed the trial court and remanded because the plaintiffs failed to file a summons with their complaint leaving the trial court without personal jurisdiction over the defendants. The Court of Appeals also noted that the trial court abused its discretion when it conducted a hearing on defendant's motion to set aside default judgment without providing notice to the defendants. The court reasoned that the trial court's failure to provide defendants notice of a hearing on their motion denied them the opportunity to be heard, which was against due process. The Court of Appeals also reasoned that the lack of a summons denied defendants the instruction on the time within which they were required to respond to the complaint and was therefore not excused under trial rule 4.15 (F). Our Supreme Court has held that “actual knowledge of the suit does not satisfy due process or give the court in personam jurisdiction.” Citimortgage, Inc. v. Barabas, 975 N.E.2d 805, 817 (Ind. 2012) (quoting Overhauser v. Fowler, 549 N.E.2d 71, 73 (Ind. Ct. App. 1990)).

Court of Appeals found that just as the service of a summons not accompanied by a complaint was insufficient to confer personal jurisdiction, the service of the complaint not accompanied by a summons is similarly insufficient to confer personal jurisdiction.
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