HARPER v. COPPERPOINT MUT. INS. HOLDING CO. , 2022 NV 33 ( 2022 )

138 Nev., Advance Opinion 33
IN THE SUPREME COURT OF THE STATE OF NEVADA
DARIA HARPER, AN INDIVIDUAL; No. 82158
AND DANIEL WININGER, AN
INDIVIDUAL,
Appellants,
vs.
COPPERPOINT MUTUAL INSURANCE
HOLDING COMPANY, AN ARIZONA
CORPORATION; COPPERPOINT
GENERAL INSURANCE COMPANY,
AN ARIZONA CORPORATION; LAW
OFFICES OF MARSHALL
SILBERBERG, P.C., A CALIFORNIA
CORPORATION; KENNETH
MARSHALL SILBERBERG, A/K/A
MARSHALL SILBERBERG, A/K/A K.
MARSHALL SILBERBERG, AN
INDIVIDUAL,
Respondents.
Appeal frorn a district court judgment, certified as final under
NRCP 54(b), in an action for declaratory and injunctive relief. Eighth
Judicial District Court, Clark County; Jerry A. Wiese, Judge.
Affirmed.
Blumberg Law Corporation and John P. Blumberg, Long Beach, California;
Maier Gutierrez & Associates and Jason R. Maier, Las Vegas,
for Appellants.
Hooks Meng & Clement and Dalton L. Hooks, Jr., and Sami N. Randolph,
Las Vegas,
for Respondents Copperpoint Mutual Insurance Holding Company and
Copperpoint General Insurance Company.
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McBride Hall and Robert C. McBride and Heather S. Hall, Las Vegas; Kjar,
McKenna & Stockalper, LLP, and Robert L. McKenna, III, James J. Kjar,
and Jon R. Schwalbach, El Segundo, California,
for Respondents Law Offices of Marshall Silberberg, P.C., and Kenneth
Marshall Silberberg.
BEFORE THE SUPREME COURT, HARDESTY, STIGLICH, and
HERNDON, JJ.
OPINION
By the Court, HERNDON, J.:
This appeal implicates the scope of NRS 42.021, Nevada's
codification of the collateral source rule as it pertains to medical malpractice
lawsuits. Subsection 1 of that statute provides that "[iln an action for injury
or death against a provider of health care based upon professional
negligence, if the defendant so elects, the defendant may introduce evidence
of any amount payable as a benefit to the plaintiff as a result of the injury
or death" from a collateral source, such as workers compensation benefits.
(Emphasis added.) In turn, subsection 2 provides that the payer of
collateral benefits introduced pursuant to subsection 1 cannot Id ecover
any amount against the plaintiff; or [b] e subrogated to the rights of the
plaintiff against a defendant."
Here, we are asked to consider whether NRS 42.021(2)s
prohibition on a collateral source provider's right to recover extends to a
medical malpractice case that was settled before proceeding to trial. We
conclude that, based on NRS 42.021s plain language, the statute applies
only to situations in which a medical malpractice defendant "introduce[s]
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evidence of a plaintiffs collateral source benefits, which necessarily does
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not occur when a case is settled pretrial. Nor are we persuaded that any
exceptions to our plain-language analysis are applicable. Accordingly, we
affirm the district court's order denying appellant's request for a declaration
that NRS 42.021 precluded respondent from recovering its workers'
compensation payments from appellant's medical malpractice settlement
proceeds.
FACTS AND PROCEDURAL HISTORY
In 2014, appellant Daria Harper sustained a work-related
injury in Arizona. Respondents Copperpoint Mutual Insurance Company
and Copperpoint General Insurance Company (collectively Copperpoint)
are Arizona-based workers' compensation insurers that provided coverage
for Harper's injury, which included medical treatment. As part of that
treatment, Harper underwent a procedure in Las Vegas in 2015 during
which Harper suffered an additional severe injury resulting in quadriplegia,
as well as severe pain, suffering, and emotional distress. In 2016, Harper
filed a medical malpractice action in Nevada against the doctors and
hospital who performed the Las Vegas procedure. Harper was represented
by respondents Kenneth Marshall Silberberg and the Law Offices of
Marshall Silberberg (Silberberg) in that action.
When Copperpoint became aware of Harper's medical
malpractice action, it sent a letter to Silberberg stating that, under Arizona
Revised Statute section 23-1023, Copperpoint was entitled to a lien against
any recovery Harper might thereafter obtain in the action. Specifically,
'Harper's husband is a plaintiff in the underlying action and is also
named as an appellant in this appeal. However, his claims hinge on the
viability of Harper's claims, so this opinion simply refers to appellants as
"Harper."
3
Copperpoint claimed that it was entitled under that statute to be
reimbursed for the roughly $3 million that it had paid in workers'
compensation-related benefits stemming from the initial work-related
injury.2 Silberberg sent a letter in response, explaining that Harper had
already settled the medical malpractice action with the doctors and hospital
for roughly $6 million and that under NRS 42.021(2), Copperpoint was
prohibited from seeking reimbursement. Thereafter, Copperpoint sent
Harper a letter notifying her that it was suspending her workers'
compensation coverage until she reimbursed Copperpoint for the $3 million
it had already paid her.
This prompted Harper to file the underlying action against both
Copperpoint and Silberberg. As relevant here, Harper asserted claims for
declaratory and injunctive relief, claiming that NRS 42.021(2) prohibited
2Arizona Revised Statute section 23-1023 is similar to NRS
616C.215(5) in that both statutes entitle a workers compensation provider
to a lien against any monetary recovery a covered employee obtains against
a third party. Compare NRS 616C.215(5), with Ariz. Rev. Stat. Ann. § 23-
1023(D) (2014). Both Nevada and Arizona also have statutes pertaining
specifically to medical malpractice actions wherein a defendant may
introduce evidence of a plaintiff receiving third-party payments, including
workers' compensation benefits. Compare NRS 42.021(1), with Ariz. Rev.
Stat. Ann. § 12-565(A) (2021). However, whereas NRS 42.021(2) prohibits
a third-party payer of benefits (such as a workers' compensation provider)
from seeking reimbursement from the medical malpractice plaintiff in such
instances, Arizona Revised Statute 12-565(C) prohibits seeking
reimbursement "[ujnless otherwise expressly permitted to do so by statute."
Here, the parties appear to agree that Arizona Revised Statute section 23-
1023(D) qualifies as the "expresa permi[ssion]" referred to in section 12-
565(C), such that Arizona law permits a workers' compensation provider to
recover from a medical malpractice plaintiff when the defendant has
introduced evidence of workers' compensation payments, whereas in
Nevada, NRS 42.021(2) prohibits a workers' compensation provider from
seeking such a recovery in those circumstances.
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Copperpoint from asserting a lien against her settlement proceeds and
seeking an injunction requiring Copperpoint to continue paying her
workers compensation benefits.3
After filing her complaint, Harper filed a motion for partial
summary judgment, making a two-step argument that (1) NRS 42.021(2)
prohibited Copperpoint from asserting a lien against her settlement
proceeds, and (2) that statute, rather than conflicting Arizona law, was
applicable to the underlying litigation. Contemporaneously, Copperpoint
filed an NRCP 12(b)(5) motion to dismiss wherein it essentially argued the
mirror image of Harper's arguments, namely, that (1) NRS 42.021(2) does
not prohibit Copperpoint from asserting a lien against Harper's medical
malpractice settlement proceeds, and (2) even if NRS 42.021 does prohibit
Copperpoint from doing so, conflicting Arizona law governs the
reimbursement issue. In addition, Copperpoint argued that the district
court lacked subject matter jurisdiction because Arizona's workers'
compensation system had exclusive jurisdiction over Harper's claims,
which, in effect, were simply seeking continued workers' compensation
benefits.
The district court denied Harper's motion for partial summary
judgment and granted Copperpoint's NRCP 12(b)(5) motion. In so doing,
the district court concluded that NRS 42.021s plain language applied only
to actions where third-party payments were "introduce [(I] [into] evidence"
and did not apply to cases that settled before trial. In light of that
3 Inthe event that NRS 42.021(2) did not prohibit Copperpoint from
asserting a lien, Harper alternatively asserted a legal malpractice claim
against Silberberg for its handling of the settlement in her previous medical
malpractice action.
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conclusion, the district court did not definitively resolve whether NRS
42.021 should apply instead of conflicting Arizona law, nor did it resolve
Copperpoint's argument that it lacked subject matter jurisdiction over the
matter. Thereafter, the district court certified its order as final under
NRCP 54(b), and Harper filed this appeal.4
DISCUSSION
Before considering the parties arguments regarding NRS
42.021, we must first address Copperpoint's argument that the district
court lacked subject matter jurisdiction over Harper's claims. We review
both issues de novo. See Ogawa v. Ogawa, 125 Nev. 660, 667, 221 P.3d 699,
704 (2009) ("Subject matter jurisdiction is a question of law subject to de
novo review."); see also Williams v. United Parcel Servs., 129 Nev. 386, 391,
302 P.3d 1144, 1147 (2013) (recognizing that issues of statutory
construction are reviewed de novo).
The district court had subject matter jurisdiction over Harper's claims for
declaratory and injunctive relief
As a threshold matter on appeal, Copperpoint reiterates its
argument that the district court lacked subject matter jurisdiction over
Harper's declaratory and injunctive relief claims. Copperpoint appears to
be contending that Harper's claims are, in essence, simply seeking
continued workers' compensation benefits that must be pursued through
Arizona's workers' compensation system. Cf. Ariz. Rev. Stat. Ann. § 23-
4Despite the district court having not resolved Harper's claims
against Silberberg, this court permitted Silberberg to file a brief because
Harper's claims against Silberberg hinge on the success of Harper's
appellate arguments. Although Silberberg is listed as a respondent and has
filed an answering brief, Silberberg's arguments therein are aligned with
Harper's arguments, and we need not address them separately in this
opinion.
6
1022(A) (1984) (providing that "[t]he right to recover compensation
pursuant to . . . [Arizona's worker's compensation statutes] for injuries
sustained by an employee . . . is the exclusive remedy against
the . . . employer's workers compensation insurance carriee). For support,
Copperpoint observes that Harper has filed a claim with Arizona's workers'
compensation system that is now proceeding through Arizona's appellate
court system. In response, Harper contends that she is not actually seeking
continued workers' compensation benefits (even though her injunctive relief
claim requests precisely that), but that she instead is simply seeking a
declaration that Copperpoint cannot assert a lien against her medical
malpractice settlement proceeds under Nevada law. In short, Harper does
not meaningfully address the significance of the Arizona litigation.
Nonetheless, having considered both parties' arguments, we
conclude that the district court had subject matter jurisdiction over
Harper's claims. While Harper's claims may incidentally be seeking
continued workers' compensation coverage, the gravamen of her complaint
seeks a judicial declaration that, under NRS 42.021, Copperpoint is
prohibited from seeking reimbursement from her medical malpractice
settlement proceeds. Characterized as such, Harper's complaint seeks a
judicial interpretation of a Nevada statute that affects the parties' rights to
proceeds from a medical malpractice action that was filed in Nevada and
that stemmed from alleged malpractice that occurred in Nevada. Such a
request for relief falls squarely within the district court's jurisdiction. See
NRS 30.030 (providing that under Nevada's Uniform Declaratory
Judgments Act, "[c]ourts of record within their respective jurisdictions shall
have power to declare rights, status and other legal relations whether or not
further relief is or could be claimed" and that "[t]he declaration may be
7
either affirmative or negative in form and effect"); Kress v. Corey, 65 Nev.
1, 26, 189 P.2d 352, 364 (1948) (holding that the only prerequisites for a
court to grant declaratory relief are that "(1) there must exist a justiciable
controversy; that is to say, a controversy in which a claim of right is asserted
against one who has an interest in contesting it; (2) the controversy must
be between persons whose interests are adverse; (3) the party seeking
declaratory relief must have a legal interest in the controversy, that is to
say, a legally protectible interest; and (4) the issue involved in the
controversy must be ripe for judicial determination"). Based on the
foregoing, we determine that at the time Harper filed her complaint, a
justiciable controversy existed between herself and Copperpoint that was
ripe for judicial determination and as such was appropriately brought as a
declaratory relief action. Accordingly, we conclude that the district court
had subject matter jurisdiction over Harper's claims for declaratory and
injunctive relief.
By its plain language, NRS 42.021 does not prohibit a collateral source
provider from seeking reimbursement from medical malpractice proceeds
when the medical malpractice action is settled before trial
We next consider whether NRS 42.021 applies to settlements in
addition to trials. In relevant part, NRS 42.021 provides,
1. In an action for injury or death against a
provider of health care based upon professional
negligence, if the defendant so elects, the defendant
may introduce evidence of any amount payable as a
benefit to the plaintiff as a result of the injury or
death pursuant to the United States Social Security
Act, any state or federal income disability or
worker's compensation act . . . . If the defendant
elects to introduce such evidence, the plaintiff may
introduce evidence of any amount that the plaintiff
has paid or contributed to secure the plaintiff's
8
right to any insurance benefits concerning which
the defendant has introduced evidence.
2. A source of collateral benefits introduced
pursuant to subsection 1 may not:
(a) Recover any amount against the plaintiff;
or
(b) Be subrogated to the rights of the plaintiff
against a defendant.
(Emphases added.)5
Both Harper and Copperpoint agree that subsection rs
reference to "introduce evidence," by its terms, applies to trials but not
settlements. Cf. Leven v. Frey, 123 Nev. 399, 403, 168 P.3d 712, 715 (2007)
("Generally, when a statute's language is plain and its meaning clear, the
courts will apply that plain language."). The parties disagree, however,
whether subsection 2 should be construed to apply to settlements as well.
Harper raises two arguments in favor of applying the statute to settlements:
(1) construing it by its plain language would produce an absurd result; or
(2) the statute should be construed consistent with the way the California
Court of Appeal has construed California Civil Code section 3333.1, the
statute upon which NRS 42.021 was based. We address each of Harper's
arguments in turn.
5NRS 42.021 was enacted by Nevada's voters in 2004 as part of a
statewide ballot initiative entitled "Keep Our Doctors in Nevada" (KODIN).
See Secretary of State, 2004 Statewide Ballot Questions Summary,
at 1, https://www.leg.state.nv.us/division/research/votenvlballotquestions/
2004.pdf. The primary purpose of KODIN and NRS 42.021 was to decrease
the costs of medical malpractice insurance in order to keep doctors from
leaving the practice of medicine in Nevada. See Secretary of State,
Statewide Ballot Question No. 3, 15-16 (Argument in Support of Question
No. 3 2004) (explaining that Question No. 3, if enacted, would decrease the
cost of medical malpractice insurance).
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Construing NRS 42.021 by its plain language would not produce an
absurd result
As indicated, NRS 42.021(1) permits a defendant in a medical
malpractice action to "introduce evidence of third-party payments, which,
by definition, limits the statutes applicability to trials. See Introduce Into
Evidence, Black's Law Dictionaiy (11th ed. 2019) ("To have (a fact or object)
admitted into the trial record . . . ."). Harper contends that applying NRS
42.021 by its plain language would produce absurd results and that this
court should therefore go beyond the statutes plain language and apply it
to settlements. Cf. Young v. Nev. Gaming Control Bd., 136 Nev. 584, 586,
473 P.3d 1034, 1036 (2020) (recognizing that this court interprets statutes
by their plain meaning unless there is ambiguity, "the plain meaning would
provide an absurd result," or the plain meaning "clearly was not intended"
(internal quotation marks omitted)). In particular, the "absurdity" that
Harper posits is that if NRS 42.021 does not apply to settlements,
parties who wanted to settle a medical malpractice
case and have the benefit of barring a workers'
compensation lien, would have to enter into the
charade of a two-phase settlement agreement that
required them in phase one to begin a trial where
evidence of the collateral source payments was
introduce[d] into evidence, then immediately
inform the district court of the settlement thereby
ending the trial.
We are not persuaded by Harper's argument. In particular, and
as this court has previously observed, the intent behind NRS 42.021(1) and
(2) is that if a medical malpractice defendant chooses to introduce evidence
that a plaintiff received a third-party payment, the jury will reduce the
plaintiffs damages award by that same amount, thereby making it
appropriate to prohibit the third-party payer from seeking reimbursement
from that award. See McCrosky v. Carson Tahoe Reel Med. Ctr., 133 Nev.
10930, 936, 408 P.31 149, 155 (2017) (explaining the intent of NRS 42.021(1)
and (2) based on this court's reading of the explanations provided in the
2004 statewide ballot question); see also Secretary of State, Statewide Ballot
Question No. 3, 15-16 (Argument in Support of Question No. 3 2004)
(explaining that Question No. 3, if approved, "stops cdouble-dipping by
informing juries if plaintiffs are receiving money from other sources for the
same injury"); id. at 18 (Rebuttal to Argument Against Question No. 3)
(explaining that Question No. 3, if approved, would permit a "jury [to] be
told about [third-party] payments and use that information in deciding
what to award the plaintiff' (emphasis added)). Accordingly, NRS 42.021(1)
and (2) make sense in the context of a trial, but not necessarily in the
context of a settlement wherein a plaintiff and a defendant (such as Harper
and the medical malpractice defendants) entered into an agreement in
which the third-party provider (such as Copperpoint) was not involved in
the settlement negotiations.
Thus, although a plain-language construction of NRS 42.021
could result in the sham "triale that Harper envisions, it logically, and
more likely, would result in medical malpractice plaintiffs and defendants
accounting for the third-party payments in negotiating a settlement amount
or, similarly, including the third-party payer in the settlement negotiations.
The latter results are not absurd and, to the contrary, are in line with NRS
42.021s intent to prevent a plaintiff from "double-dipping."
Consequently, we are not persuaded that a plain-language
construction of NRS 42.021 would produce an "absurd" result, which is a
result "so gross as to shock the general moral or common sense." Home
Warranty Adm'r of Nev., Inc. v. State, Dep't of Bus. and Indus., 137 Nev.,
Adv. Op. 5, 481 P.3d 1242, 1247 (2021) (quoting Crooks v. Harrelson, 282
11
U.S. 55, 60 (1930)). Accordingly, we conclude that NRS 42.021(2)s bar
regarding a collateral benefit provider's ability to recover does not apply in
medical malpractice cases that are settled before trial.
We decline to construe NRS 42.021 consistently with how the
California Court of Appeal has construed its statutory analog
In the alternative to her absurd-results argument, Harper
contends that NRS 42.021 should apply to settlements because the
California Court of Appeal has construed California Civil Code section
3333.1, the statute upon which NRS 42.021 was based, to apply to
settlements.6 Cf. State ex rel. Harvey v. Second Judicial Dist. Court, 117
Nev. 754, 763, 32 P.3d 1263, 1269 (2001) ("Millen a statute is derived from
a sister state, it is presumably adopted with the construction given it by the
highest court of the sister state." (quoting Clark v. Lubritz, 113 Nev. 1089,
1096 n.6, 944 P.2d 861, 865 n.6 (1997))); Ex parte Skaug, 63 Nev. 101, 107-
08, 164 P.2d 743, 746 (1945) (recognizing the same canon of statutory
construction). In particular, Harper relies on Graham v. Workers'
Compensation Appeals Board, 258 Cal. Rptr. 376 (Ct. App. 1989). The
Graham court addressed the identical issue presented here: whether
California Civil Code section 3333.1, despite its plain language applying
only to trials, should also apply to settlements. Id. at 381. The Graham
court concluded that "blind obedience to the statutes plain language would
defeat the Legislatures purpose of enacting section 3333.1, which was part
of a larger bill intended to reduce the cost of medical malpractice insurance
and, according to the Graham court, also to reduce the cost of medical
malpractice litigation. Id. at 381-82. Given that the bill that included
6Copperpoint does not dispute that NRS 42.021 is substantively
identical to California Civil Code section 3333.1.
12
section 3333.1 was intended to reduce the cost of medical malpractice
litigation, the Graham court held that applying section 3333.1 to
settlements would further that purpose. Id. at 382.
Harper contends that because Graham was decided before NRS
42.021 was enacted by Nevada's voters in 2004, the voters must have
adopted NRS 42.021 with the construction that Graham gave California
Civil Code section 3333.1. Despite Harper's contention, we nevertheless are
not persuaded that we should apply our adopt-the-sister-states-
construction rule of statutory construction in this instance for three
reasons. First, and most significantly, as we explained above, NRS 42.021s
language is plain and unambiguous, meaning there is no language to
actually "construe." See Leven, 123 Nev. at 403, 168 P.3d at 715 ("Generally,
when a statutes language is plain and its meaning clear, the courts will
apply that plain language."), White v. Warden, Nev. State Prison, 96 Nev.
634, 636, 614 P.2d 536, 537 (1980) ("[W]e recognize that the intent of the
legislature [or, in this case, Nevada's voters] is the controlling factor and
that, if the statutes under consideration are clear on their face, we cannot
go beyond them in determining [the voters] intent." (citing, inter alia, State
v. Beemer, 51 Nev. 192, 199, 272 P. 656, 658 (1928))). Second, Graham is
not a decision by California's highest court, and in the absence of supporting
authority cited by Harper, we are reluctant to expand our adopt-the-sister-
states-construction rule to decisions of a state's intermediate courts.7 See
7Harper also relies on the California Supreme Court's decision in
Barme v. Wood, 689 P.2d 446 (Cal. 1984). She contends that Barme held
that California Civil Code section 3333.1 applies even when there is no trial.
This is not completely accurate, because although there had been no trial in
Barme, the California Supreme Court simply addressed whether section
3333.1 violated due process or equal protection. Id. at 450-51 (holding that
13
Edwards v. Emperor's Garden Rest., 122 Nev. 317, 330 n.38, 130 P.3d 1280,
1288 n.38 (2006) (observing that it is a party's responsibility to support
arguments with on-point authority). Finally, we believe that the Graham
court's rationale for applying section 3333.1 to settlements is somewhat
tenuous, in that it is questionable whether applying it as such would have
any appreciable impact on decreasing the costs of medical malpractice
insurance, which was the purpose behind Nevada's voters enacting NRS
42.021. See Secretary of State, Statewide Ballot Question No. 3, 15-16
(Argument in Support of Question No. 3 2004) (explaining that Question
No. 3 would decrease the cost of medical malpractice insurance); see also
Pascua v. Bayview Loan Servicing, LLC, 135 Nev. 29, 31, 434 P.3d 287, 289
(2019) ("[W]here the statutory language does not speak to the issue before
us, we will construe it according to that which reason and public policy
would indicate the legislature [or, in this case, Nevada's votersl intended."
(original alterations omitted)). Accordingly, we decline to apply NRS 42.021
in the same manner that the California Court of Appeal applied California
Civil Code section 3333.1 in Graham,.
CONCLUSION
We hold that the plain language of NRS 42.021(1) and (2)
prohibits a payer of collateral source benefits from seeking reimbursement
from a medical malpractice plaintiff only when the medical malpractice
defendant "introduce [s] evidence of those payments, which necessarily
does not occur when a case is settled pretrial. Nor are we persuaded that
any exceptions to our plain-language analysis are applicable or that we
there was no violation). Thus, we conclude that Barme does not speak to
whether California Civil Code section 3333.1 applies absent a trial.
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should adopt the California Court of Appeal's application of California's
analogous statute. Accordingly, we affirm the judgment of the district
court.
J.
Herndon
We concur:
J.
Hardesty
J.
Stiglich
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