Bulletin

Passmore v. Baylor Health Care Systems: Possible Outcome of Negligence and Vicarious Liability Claims Give Courts Jurisdiction Over Proceedings Related to Bankruptcy

Case AnalysisJoseph Rodriguez

Passmore v. Baylor Health Care Sys., 823 F.3d 292 (5th Cir. 2016).
Opinion Issued May 19, 2016. Westlaw Link  
Written by: Joseph Rodriguez, Staff Editor

The plaintiff received two back surgeries that left him completely disabled. The plaintiff filed suit against the nurse and hospital for direct negligence and vicarious liability. The doctor, however, was not a party to the suit because he filed for bankruptcy protection. On appeal, the plaintiff claimed the federal court had “‘related to’ bankruptcy” jurisdiction over the case, under 28 U.S.C. § 1334, since the outcome of the suit could have an impact on the doctor’s bankruptcy proceeding.

While not the main issue in the civil case, the Fifth Circuit reviewed de novo whether the district court had “‘related to’ bankruptcy” jurisdiction based on the doctor’s case. However, the plaintiff never explained the reason he believed the court had “‘related to’ bankruptcy” jurisdiction. The court reasoned that if the plaintiff was successful in the negligence or vicarious liability suit against the nurse and hospital, the defendants could have indemnity or contribution claims against the doctor. Any indemnity or contribution suit would impact the doctor’s estate, giving the court the “‘related to’ bankruptcy” jurisdiction over the negligence case at issue.

In finding the civil lawsuit could affect the doctor’s bankruptcy proceeding, the court obtained subject matter jurisdiction over the civil suit. The court’s broad reasoning that the outcome of the lawsuit could affect the nonparty’s bankruptcy proceeding illustrates the court’s ability to overcome jurisdictional issues.