Appeals court rescues Philly lawyer from $1M fine

A $1 million sanction imposed on insurance defense lawyer Nancy Raynor because her witness gave precluded testimony in a medical-malpractice trial has been overturned by a Pennsylvania appellate court.

The Superior Court panel found that the instructions of Common Pleas Court Judge Paul Panepinto were vague and left open the possibility that the testimony was permissible.

The $1 million sanction, imposed on Raynor after a 2012 trial, caused an uproar in the Philadelphia bar, with many lawyers arguing that the fine was excessive and that it exposed lawyers to punishing sanctions for conduct by witnesses beyond their control.

Lawyers with long experience in the city said they had never seen a sanction order in a civil case of that magnitude.

"We are thrilled with the decision," said Raynor's appellate lawyer, Maureen McBride. "This has been an excruciatingly difficult ordeal for Nancy, and we are happy for her sake that it is finally over."

The appellate court panel rejected every finding by Panepinto that the sanction was justified, and it sharply criticized plaintiff lawyers Matthew D'Annunzio and Joseph Messa Jr., who sought the sanction as compensation for costs they said they incurred as a result of the precluded testimony and consequent mistrial.

The appellate panel found that the lawyers' charges were excessive and that they had engaged in personal attacks on Raynor throughout the legal battle over the sanction.

"Each time plaintiff's counsel brought the contempt issue before the court, they presumed what they were initially required to prove and presented their conclusions with transparent venom, bloom, innuendo and increased outrage, refreshed periodically with personal attacks on Ms. Raynor," said the opinion, written by Superior Court President Judge Susan Gantman.

Reached for comment Wednesday, Messa said he had not yet been able to carefully review the opinion and did not know whether there would be an appeal.

But he stood by the initial request for sanction.

"Nancy Raynor clearly violated a court order, and there was no question as to what the court order was and what counsel's obligations were," Messa said. "The order was in place long before the violation, and there was a reminder the day of the violation. It has cost hundreds of thousands of dollars. Who should pay for that? The person responsible for the violation or everyone else?"

Panepinto, an unsuccessful candidate for the state Supreme Court last year, imposed the sanction in the trial of allegations that physicians at Roxborough Memorial Hospital had failed to properly diagnose a suspicious nodule in the left lung of patient Rosalind Wilson, who had gone to the emergency room complaining of chest pains.

Wilson later died of lung cancer, and at the trial, lawyers for her estate asked the court to ban testimony on her lifelong smoking habit. A defense witness nonetheless mentioned Wilson's smoking habit in his testimony, throwing the trial into an uproar and resulting in Panepinto's sanction order.

Before the trial, Panepinto had issued a written order requiring defense lawyers to instruct their witnesses that all mention of Wilson's smoking was prohibited. But his oral instructions at the start of the trial were vague as to whether witnesses had to be advised of the precluded information just before testifying.

Raynor's witness, emergency-room physician John Kelly, said during his testimony that Wilson was a smoker, in response to a question from Raynor about Wilson's cardiac risk factors.

Raynor later came forward with three witnesses who said they had heard her advise Kelly before the start of the trial that smoking testimony was off-limits. Panepinto discredited their testimony while concluding that Raynor had deliberately sought to elicit the precluded testimony.

The Superior Court panel said there was no evidence that Raynor had sought to induce Kelly's testimony. It noted, as well, that Kelly could not remember whether Raynor had told him not to mention smoking. Panepinto also erred, the appellate judges said, by accepting costs submitted by Messa and D'Annunzio without a hearing to determine their validity.

The panel also found that the witnesses who testified they had heard Raynor instruct Kelly not to mention smoking were credible.

Raynor's case drew widespread notice not only because of the size of the sanction but also because of the financial toll it exacted from her law practice and personal life.

As a result of Panepinto's sanction order, her bank accounts were frozen and a lien was placed on her home. Though the orders were set aside by the Superior Court when it agreed to hear the case, Raynor has said it has been a struggle to keep her law practice going.

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