Choice of Law in Medical Malpractice Suits

Ginsberg v. Quest Diagnostics, 147 A.3d 434 (N.J. 2016)

This recent decision of the New Jersey Supreme Court articulates the choice of law principles for medical malpractice suits.

The plaintiffs, Mr. and Mrs. Ginsberg, resided in New York City during the period relevant to their suit against the defendants. When the plaintiffs’ daughter was seven months old, she was diagnosed with Tay-Sachs disease, a genetically inherited, incurable neurological disorder. At the age of three, the daughter died of that disease.

The plaintiffs filed a negligence suit against Quest Diagnostics, a New Jersey corporation, for failure to provide correct blood test results. Together with Quest, they sued several doctors and medical centers, also domiciled in New Jersey, to whom they attributed negligent medical counseling. The plaintiffs argued that the defendants’ negligence denied them critical information and the consequent opportunity to seek prenatal testing for Tay-Sachs disease and to terminate Mrs. Ginsberg’s pregnancy. They asserted claims for wrongful birth, wrongful life, negligence, negligent hiring and medical malpractice.

Quest filed a third-party claim for indemnification, contribution, and breach of contract against Mount Sinai Medical Center, domiciled in New York.

As far as wrongful birth is concerned, New Jersey law recognizes damages for the emotional injury of the parents and the special medical expenses attributable to raising a child with a congenital impairment (but not damages for the impairment itself). New York law, in contrast, limits wrongful-birth compensation to economic damages. Under this law, the aggrieved parents can only recover the pecuniary expense which they have borne, and must continue to bear, for the care and treatment of their child. Damages for psychic or emotional harm resulting from the birth of the child in an impaired state are not recoverable.

Unsurprisingly, all defendants moved for a determination that New York law govern the plaintiffs’ claims against them. The plaintiffs, for their part, argued that the case should be governed by the law of New Jersey. This controversy took the parties all the way up to the New Jersey Supreme Court.

This Court decided that the trial court must identify the applicable law for each individual defendant in accordance with the principles set forth in the Restatement (Second) of Conflict of Laws (1971), and remanded the case.

Specifically, the Court ruled that:

Where, as here, there is a genuine conflict between the laws of the relevant states, the trial court must identify the state that is the place of the injury and presume that the law of that state governs the action. This principle made New York law presumptively applicable to the case at bar.

This presumption, however, is defeasible. When a competing state has a more significant relationship to the parties and issues, the court should overturn the presumption and apply the law of that state. This exception requires the trial court to carry out the so-called “contacts analysis.” As part of that analysis, the trial court must consider not only the place of the injury and the place of the parties’ relationship, but also each defendant’s domicile, residence, nationality, place of incorporation and place of business, as well as a relevant state’s interest in deterring its citizens from engaging in unlawful conduct, in applying policies that underlie a particular field of law, and in protecting its citizens’ expectations and reliance.

The “contacts analysis” may identify a different state law as applying against each defendant, and the trial court was asked to carry out that analysis. The Court added in this connection that “In a case such as this, involving the law of only two states, a defendant-by-defendant approach is unlikely to prove impractical should the matter proceed to trial.”

The Court, however, also acknowledged that “[A] defendant-by-defendant choice-of-law analysis is not feasible in every matter. In very complex cases with many defendants and multiple claims, a defendant-specific choice-of-law analysis may generate a jury charge that is unwieldy and unclear. … In a complex case with many parties from different states, the trial court retains the discretion to decline a defendant-by-defendant approach and … apply the law of a single state to claims asserted against all defendants.”