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In 2003, a patient had liver transplant surgery at UPMC, a Pittsburgh based healthcare system. In a recent 4 to 3 decision, the Pennsylvania Supreme Court decided to throw out the state law barring medical malpractice lawsuits after 7 years. The case lives on.

A little history and background.

In 2002, the Pennsylvania legislature, in response to the then current medical malpractice crisis, enacted assorted tort reforms. It did so to control runaway premium costs and prevent doctors from fleeing the state. One of the reforms put a hard cap on when a claim could be brought. It is called the statute of repose. In Pennsylvania, it was set at seven years. The statute of repose is a bit different from the statute of limitations. The statute of limitations prevents a claim from being brought after X years from date the negligence was discovered or should have been discovered. The statute of repose adds to the statute of limitations. It imposes a hard bar on the number of years from the date of the event triggering the negligence – no matter when the negligence was discovered.

For example, if the statute of limitations is two years and the statute of repose is 4 years, this means that if the patient discovers the negligence 3 years after surgery, then files suit within a week, the suit goes on. Why? The patient just discovered the negligence, so he is within the statute of limitations. Plus, the suit is filed before four years from surgery have elapsed.

A different example from the same state – with the statute of limitations being two years and the statute of repose being 4 years:

(a) if a patient discovers the negligence 5 years after surgery, and files suit the next week; or

(b) if a patient discovers the negligence 2 years after surgery, then waits for 5 years after surgery to file suit –

the legal system delivers the same outcome. The suit is barred by the statute of repose. The defendant prevails.

Back to Pennsylvania.

In 2003, Christopher Yanakos donated a portion of his liver to his mother, Susan Yanakos. Susan suffered from alpha-1 antitrypsin deficiency (AATD). According to the lawsuit, UPMC doctors supposedly tested Christopher for alpha-1 antitrypsin deficiency, but never informed him of the results. He donated a portion of his liver to his mom.

In 2014, Susan learned she still had alpha-1 antitrypsin deficiency. This was discovered after a routine blood test. Christopher had a similar test and learned he also had alpha-1 antitrypsin deficiency. Both Christopher and Susan are still alive.

The family’s attorney Patrick Cavanaugh stated:

Christopher may need a liver transplant in the future, though the procedure may be more difficult because his liver was surgically altered during the lobe donation, according to Cavanaugh.

“The family assumed that if the liver transplant went forward, the doctors would use a healthy liver,” Cavanaugh said. “It was a safe assumption by the family that Christopher didn’t have AATD, but in fact he did. There’s no way the plaintiffs could have found all that out within seven years.”

UPMC defended with the statute of repose, stating the family waited too long to file suit. The lower court and appellate court agreed. The Pennsylvania Supreme Court overruled. That court ruled

the statute of repose unconstitutionally violates the right of access to the courts and lacks any substantial relationship to the legislative goal of controlling malpractice insurance costs and premiums.

Apparently six other states have also have had statutes of repose struck down – Alabama, Indiana, Kentucky, New Hampshire, Rhode Island, and Utah.

The import is that a med mal case may have a long shelf life well after the medical event transpired. This may have the same effect on premiums for many specialties that the long effective statute of limitations has for ob-gyn physicians. If an infant is injured, they have years to file a claim.

What can be done? Hard to say. One option is binding arbitration under the Federal Arbitration Act (FAA). The FAA is a federal law enacted decades ago. The FAA has withstood the test of time. The US Supreme Court has stated on several occasions it (federal law) trumps state law if the state tries to place restrictions on using arbitration for resolving disputes in health care. The state can still place reasonable restrictions on the formation of the arbitration contract. For example, if the patient is asked to sign an arbitration agreement while on the gurney and propofol is ready to be infused for anesthesia, that would be considered unconscionable and struck down. But, if the patient is given time to review the agreement; it is written in plain language and not buried in 25 other documents; and any restrictions are mutual and not onerous, the arbitration agreement would likely be enforceable.

Could an arbitration agreement be used to bring back a reasonable statute of repose? Possibly. If state courts have ruled that 7 years may be too short and you want 7 years to be the hard cap, the arbitration agreement should “give” the patient something in return; for example, the defendant doctor would pay the first $3k in arbitration fees. Or some other “give.” You would give to get. That is the essence of any bargained-for agreement.

It will be interesting to see if this ruling moves the needle on Pennsylvania professional liability premiums. Rates are already starting to climb. I would not be surprised if the effect is a sharp swing up. If this materializes, then the courts will soon have precisely the information they said argued missing in this case:

“The statute of repose lacks any substantial relationship to the legislative goal of controlling malpractice insurance costs and premiums.”

This development reinforces a point we express to our member physicians every day. In the medico-legal space, you must expect the unexpected. And you can be certain aggressive plaintiff attorneys will use this legislation to resurrect meritless claims long thought dead.  

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What do you think about the Supreme Court’s decision? Click here to join the conversation below.

Jeffrey Segal, MD, JD

Chief Executive Officer and Founder

Dr. Segal was a practicing neurosurgeon for approximately ten years, during which time he also played an active role as a participant on various state-sanctioned medical review panels designed to decrease the incidence of meritless medical malpractice cases.

Dr. Segal holds a M.D. from Baylor College of Medicine, where he also completed a neurosurgical residency. Dr. Segal served as a Spinal Surgery Fellow at The University of South Florida Medical School. He is a member of Phi Beta Kappa as well as the AOA Medical Honor Society. Dr. Segal received his B.A. from the University of Texas and graduated with a J.D. from Concord Law School with highest honors.

In 2000, he co-founded and served as CEO of DarPharma, Inc, a biotechnology company in Chapel Hill, NC, focused on the discovery and development of first-of-class pharmaceuticals for neuropsychiatric disorders.

Dr. Segal is also a partner at Byrd Adatto, a national business and health care law firm. With over 50 combined years of experience in serving doctors, dentists, and other providers, Byrd Adatto has a national pedigree to address most legal issues that arise in the business and practice of medicine.