PUBLISH

UNITED STATES COURT OF APPEALS

Filed 10/28/96

TENTH CIRCUIT

JOHN F. DEASY, JR., )

)

Plaintiff-Appellee, )

)

v. ) No. 95-1276

)

UNITED STATES OF AMERICA, Denver )

Veterans Administration Medical Center (the )

“Denver VAMC”), Baltimore Veterans )

Administration Medical Center (the Baltimore )

VAMC) and Perry Point Veterans Administra- )

tion Medical Center (Perry Point VAMC), )

)

Defendant-Appellant. )

Appeal from the United States District Court

for the District of Colorado

(D.C. No. 91-C-1082)

William G. Cole, Attorney (Robert S. Greenspan with him on the briefs), Appellate Staff

Civil Division, Department of Justice, Washington, D.C., for Defendant-Appellant.

Joseph J. Mellon, Denver, Colorado, for Plaintiff-Appellee.

Before HENRY, LOGAN and BRISCOE, Circuit Judges.

LOGAN, Circuit Judge.
2

The United States appeals from the district court’s judgment in favor of plaintiff

John F. Deasy, Jr. in his Federal Tort Claims Act (FTCA) suit for medical malpractice. 

Plaintiff asserted that psychiatrists at Veterans Administration (VA) hospitals committed

malpractice when they provided him only psychiatric treatment and failed to refer him for

medical treatment of severe edema. He further claimed that as a result of the malpractice

he suffers from post traumatic stress disorder (PTSD), which prevents him from being

able to receive the care at VA facilities to which he is entitled. The district court heard

the case without a jury and found that the VA committed malpractice in Maryland and

Colorado. The district court awarded plaintiff $3,993,971, to be placed in a reversionary

trust to provide for his future medical needs outside the VA hospital system, with any

balance at plaintiff’s death reverting to the United States. The court also awarded

plaintiff $600,000 damages for pain and suffering--$350,000 for the Maryland occurrence

and $250,000 for the Colorado occurrence, the maximum permitted under those states’

tort laws.

On appeal, the United States argues that (1) the district court judge erroneously

found that the psychiatrists committed malpractice; (2) the $4 million trust for plaintiff’s

medical treatment outside the VA system was not compensatory for his injuries suffered

and therefore was improper; and (3) the district court’s award of $600,000 for noneconomic damages was excessive.
1

 Ormond’s disease causes scar tissue in the peritoneal cavity which can encase

tubular organs or structures between organs, including veins and arteries. It is a cyclical

disease which tends to have alternating periods of activity and remission. It is apparently

difficult to diagnose; in fact, plaintiff was originally diagnosed with Ormond’s disease

and Hodgkins disease and was treated for both for some period of time.

3

I

The district court made detailed findings of fact and conclusions of law that we

summarize here. Plaintiff is a service-connected, totally and permanently disabled

veteran entitled to lifetime hospital and medical services from the VA. He has suffered

for almost forty years from idiopathic retroperitoneal fibrosis, or Ormond’s disease.1

Over the years he has required repeated hospitalization for treatment related to his

Ormond’s disease, and also for psychiatric care.

In a prior FTCA case, plaintiff asserted malpractice for treatment at the VA from

December 1976 through July 1980. The district court in that case found that the VA

system failed to provide adequate medical care to plaintiff and awarded him $474,000 in

damages. See Deasy v. United States, No. 83-M-899 (D. Colo. Dec. 27, 1985); II Supp.

App. 383-405. Plaintiff then investigated obtaining private insurance coverage as an

alternative to VA services but found he could not obtain coverage for his preexisting

condition.

Plaintiff then met with Larry Seidl, M.D., an internist who was chief of staff at the

Denver VA hospital, who agreed to become his primary treating physician. When

plaintiff was hospitalized in 1987 for a kidney and urinary tract infection, he again
4

became concerned with the quality of his treatment at the Denver VA hospital. Dr. Seidl

ultimately drafted a document titled “Important Notice to All Physicians Treating John

Deasy” (Dr. Seidl’s notice). II Supp. App. 367. The notice contained information about

plaintiff’s medical history, including his primary diagnosis of idiopathic retroperitonal

fibrosis, and briefly outlining the physical and psychiatric treatments he had received. 

The notice stated that “[w]hat Mr. Deasy justifiably seeks is to obtain the optimum

treatment available for his unusual medical condition and to avoid improper and ineffective or harmful treatment - which he has experienced in the past - based on review of his

medical records, which include diagnoses, both medical and psychiatric, that are highly

suspect, in my opinion.” Id. The notice explained that the psychiatric diagnoses in

plaintiff’s history are highly suspect because 

they have occurred either during a period when his Ormond’s disease has

been active with secondary renal function impairment and its resulting

toxicity; or they have occurred during periods when he was receiving

multiple medications including corticosteroids to control the Ormond’s

disease which became active undiagnosed - to be detected only later when it

interfered with other organ functions. From December 1976 through

August 1980, his psychiatric diagnoses included chronic schizophrenia,

manic-depressive psychosis and organic brain syndrome. It is more than

highly probable in my opinion that his mental symptoms resulted from the

adverse effects of multiple medications including corticosteroids. During

this period, he experienced an active phase of the Ormond’s disease initially

undetected, which caused common bile duct obstruction and the removal of

an acalculus gall bladder. Subsequently the inferior vena cava syndrome

developed secondary to the fibrosis. It should be noted here that during

periods when the Ormond’s disease is active, Mr. Deasy may be highly

sensitive to drugs and drug therapy of any kind should be conservative and

closely monitored. . . . The toxic side-effects of his underlying disease and

its treatment should always receive primary consideration in evaluating Mr.
5

Deasy’s mental and emotional symptoms during treatment in the Veterans

Administration Department of Medicine and Surgery.

Id. The notice included instructions that it be displayed as the top sheet in each volume of

plaintiff’s medical records. The notice was signed by Dr. Seidl; however, it did not

reflect the signature or concurrence of a psychiatrist.

In December 1989, plaintiff was staying at the Fort George Meade military base

near Baltimore, Maryland, when he developed peripheral edema related to Ormond’s

disease and the inferior vena cava syndrome. Despite plaintiff’s use of a diuretic the

edema continued to worsen. On December 19, plaintiff decided to leave Fort Meade. 

Because of the edema, his feet were too swollen to wear his shoes. He decided to load his

belongings into his van by taking them out a window so that he could avoid walking in

the snow in his bare feet. Military police officers came upon plaintiff as he was using a

hunting knife to pry the screen off a window. The military police decided that plaintiff

needed medical or psychiatric care and took him to the Fort Meade infirmary. Plaintiff

became agitated and uncooperative and was transferred to the Baltimore VA medical

center.

Upon arrival at the Baltimore VA, plaintiff was evaluated by psychiatrists and

became enraged when despite his requests he was not treated for his edema. During his

brief stay at the Baltimore VA, psychiatrist David Barrett, M.D., diagnosed him with

bipolar disorder manic psychosis, and prescribed thorazine. Although plaintiff’s friend

and former treating psychologist, Dr. Thomas Holman, gave Dr. Barrett the notice signed
6

by Dr. Seidl, Dr. Barrett analyzed an electrolyte test and decided that plaintiff’s physical

condition was not causing the psychiatric disturbance. Dr. Barrett did not prescribe any

medication or other treatment for the edema, although he noted that plaintiff’s legs were

edematous. After a few hours Dr. Barrett decided to transfer plaintiff to the Perry Point

VA medical facility, which is primarily a psychiatric facility. As part of the transfer

procedure, another psychiatrist, Robert Fiscella, M.D., also examined plaintiff and

diagnosed him as acutely manic.

When plaintiff was admitted at Perry Point, yet another psychiatrist, Eapen

Abraham, M.D., noted that both of plaintiff’s legs and feet were edematous. As with Dr.

Barrett, Dr. Abraham read Dr. Seidl’s notice but found normal electrolyte levels and

concluded plaintiff’s physical condition was not causing his psychiatric problems. 

Plaintiff did not receive a medical consultation until December 22, but even though that

examining physician noted plaintiff’s edema required attention, he prescribed no medication. Finally on December 28 plaintiff received a one-time dose of Lasix, a diuretic. The

next day plaintiff fled Perry Point because he was afraid he would have life-threatening

renal failure if he did not receive proper medical care.

Plaintiff returned to Denver, and was admitted in two private psychiatric hospitals. 

On January 29 he transferred to the Denver VA. Jay Griffith, M.D., a psychiatry resident,

examined him. Dr. Griffith read but disagreed with the contents of Dr. Seidl’s notice; he

diagnosed plaintiff as suffering from “bipolar disorder manic phase.” App. 188. Dr.
7

Griffith continued plaintiff on Lasix, and set up a medical consultation for him. Plaintiff,

however, left the Denver VA the next day because he wanted to get treatment for the

edema, which had caused marked abdominal distension.

On January 30, plaintiff’s friends arranged an appointment with Russell Simpson,

M.D., a private internist, who testified that plaintiff had “one of the worse cases of edema

that [he’d] seen.” II Supp. App. 308. Dr. Simpson treated the edema with intervenous

diuresis in the hospital; after three days plaintiff was discharged in stable physical and

psychiatric condition.

In May 1990, plaintiff sought psychiatric treatment from Richard Rewey, M.D., a

psychiatrist who had evaluated him in 1984. Dr. Rewey testified at trial that plaintiff

suffered PTSD as a result of VA treatment that was the subject of plaintiff’s first FTCA

suit. Dr. Rewey testified that the VA’s treatment of plaintiff in December 1989 and

January 1990 caused a flare-up of his PTSD in December 1990, requiring psychiatric

treatment.

The district court noted that doctors who had treated plaintiff for more than a few

days agreed that his psychiatric problems were at least partly caused by organic abnormalities, while doctors who had only briefly examined him or his records diagnosed him with

bipolar disorder. It noted that even with this diagnosis, medications for bipolar patients

were not prescribed for plaintiff. The district court then found that plaintiff suffered

PTSD in reaction to improper treatment in the VA hospitals. The court determined that
8

because plaintiff’s “well-founded fear of maltreatment in the V.A. system actually causes

or precipitates serious psychiatric problems . . . provision must be made for [plaintiff] to

receive medical and psychiatric treatment outside the V.A. system.” App. 63.

II

The United States contends the district court’s finding that the VA doctors

committed malpractice was clearly erroneous. Because this is an FTCA case we apply the

law of both Maryland and Colorado where the alleged malpractice occurred. Under

Maryland law a prima facie case of medical malpractice consists of “(1) determining the

applicable standard of care, (2) demonstrating that this standard has been breached, [and]

(3) developing a causal relationship between the violation and injury.” Muenstermann v.

United States, 787 F. Supp. 499, 520 (D. Md. 1992). In Colorado, “[t]o establish a prima

facie case, the plaintiff must establish that the defendant failed to conform to the standard

of care ordinarily possessed and exercised by members of the same school of medicine

practiced by the defendant.” Melville v. Southward, 791 P.2d 383, 387 (Colo. 1990).

The United States asserts that the district court finding of malpractice rested on a

determination that the VA hospitals failed to properly treat plaintiff’s edema, which

contributed to his psychosis and PTSD and ultimately rendered him incapable of utilizing

the VA hospitals. The United States asserts that “this theory, which is itself suspect, can

support a damages award only if the VA’s treatment of Mr. Deasy’s edema, the sole

malpractice alleged, fell below the level of care required of physicians who treat edemas.” 
9

Brief for Appellant at 13 (citing Armbruster v. Edgar, 731 P.2d 757, 759-60 (Colo. App.

1986), and Muenstermann, 787 F. Supp. at 520-21).

The United States then argues that its witness, Stuart Linas, M.D., a board certified

internist and nephrologist who testified that the VA hospitals treated plaintiff properly for

edema, was the only expert qualified to testify on the standard of care for treating edema. 

The United States asserts that plaintiff’s psychiatrists were not qualified to offer an expert

opinion on the standard of care for edema because that condition lies outside their

specialty, see Greene v. Thomas, 662 P.2d 491, 493-94 (Colo. App. 1982) (“expert

witness must have acquired, through experience or study, more than just a casual

familiarity with the standards of care of the defendant’s specialty”); Smith v. Pearre, 625

A.2d 349, 359 (Md. App.) (physicians testifying outside of own specialties must “have

sufficient knowledge, skill, and experience to make a well-informed opinion”), cert.

denied, 632 A.2d 151 (1993), and that the record does not support a finding that the VA

hospitals’ treatment of plaintiff’s edema constituted malpractice. We disagree.

Psychiatric experts asserted that the VA psychiatrists’ failure to provide medical

treatment for plaintiff’s edema, or to refer him to specialists for such treatment, fell below

the standard of care for psychiatrists. See I Supp. App. 188-89, 192 (Dr. Rewey); see also

II Supp. App. 278-85 (William McCaw, M.D.) (giving opinion that if edema was treated

plaintiff’s psychotic episode would perhaps be reduced); id. at 347-56 (John L. Wiberg,

M.D.) (stating that plaintiff’s edema would affect his brain, resulting in psychotic
2

 The district court also noted that although some of defense experts asserted that

plaintiff should have received medication for his bipolar disorder, he did not. App. 55-

56.

10

behavior; and that “immediate medical consultation” should be sought by treating

psychiatrist). Of course, under both Maryland and Colorado law a psychiatrist can testify

to the standard of care for psychiatry. Plaintiff relied upon psychiatric experts’ testimony

that it was a breach of the psychiatric standard of care to fail to refer plaintiff to an

internist or nephrologist for further evaluation of his edema, and that the failure to do so

increased his psychiatric symptoms. This evidence supports the district court’s malpractice finding. The failure to treat or refer plaintiff while he was in the Maryland VA

continued for over a week. The failure to treat plaintiff’s edema upon his admission to

the Colorado VA appears less egregious because he was scheduled to be seen the next day

by a specialist. Nonetheless, plaintiff’s experts testified that the Denver VA psychiatrists

should have evaluated and treated plaintiff’s edema immediately. This conclusion is

supported by testimony by Dr. Simpson, an internist, that immediately after leaving the

Denver VA, plaintiff had one of the worst cases of edema that he had seen, requiring

hospitalization. Although the United States presented evidence that the VA did not

breach its duty of care, the district court’s finding to the contrary is supported by the

record.2

III
11

The United States asserts that the district court erred in awarding plaintiff damages

in the form of lifetime free medical and psychiatric care. Furr v. AT&T Technologies,

Inc., 824 F.2d 1537, 1548 (10th Cir. 1987). The amount of damages is a finding of fact

that we uphold unless clearly erroneous. See Fed. R. Civ. P. 52(a). The United States

points out that although the plaintiff “is entitled to be compensated for losses attributable

to the injury inflicted . . . it is only the damage flowing legally from the defendant’s

misdeeds which counts.” Brief for Appellant at 22 (quoting Westric Battery Co. v.

Standard Elec. Co., 482 F.2d 1307, 1318 (10th Cir. 1973)). It argues that lifetime medical

care is not compensation for injuries caused by failure to coordinate plaintiff’s care or any

delay in treating plaintiff’s edema; also that if the district court based its award on a

finding that plaintiff would continue to receive improper care from the VA in the future,

the ruling is too speculative to support a damage award.

The district court, however, specifically found that the VA’s malpractice caused

plaintiff to suffer from a recurrence of PTSD. This finding is supported by the record. 

See, e.g., I Supp. App. 170-94 (psychiatrist testified that the VA’s treatment of plaintiff in

December 1989 to January 1990 caused flare-up of PTSD). The district court found that

the PTSD itself arose out of his years of improper treatment.

[It] has evolved to the point where his reaction to medical maltreatment has

become a separate and distinct psychiatric problem--namely post-traumatic

stress disorder. Once triggered, this disorder exacerbates whatever psychosis may be presenting at the same time. If not treated for his Ormond’s

disease and its resulting problems, Mr. Deasy becomes so distrustful,
12

anxious, and enraged that he literally is unable to cooperate with treatment

being offered.

App. 51. The basis of the district court’s decision to award a sum of money to permit

plaintiff to receive the future care he would need outside the VA system was that “the

medical testimony establishes that after decades of substantial treatment, [plaintiff’s]

well-founded fear of maltreatment in the V.A. system actually causes or precipitates

serious psychiatric problems.” Id. at 63. We cannot find this conclusion clearly erroneous.

The award here is very substantial. But plaintiff was entitled to lifetime free care

in government hospitals; he has extremely serious physical and mental illnesses. Both

Maryland and Colorado recognize the “thin skull” rule: “a tortfeasor must accept his or

her victim as the victim is found.” Schafer v. Hoffman, 831 P.2d 897, 900 (Colo. 1992). 

Compensation for loss of medical services would not, of course, be appropriate merely

because a plaintiff disliked the care provided by the VA; however, this is a rare case in

which plaintiff produced expert testimony supporting a finding that, due to the VA’s own

negligence, further treatment in a VA hospital would result in recurrence of his PTSD. 

The district court’s award of damages thus serves to make plaintiff whole. See Ballow v.

PHICO Ins. Co., 878 P.2d 672, 677 (Colo. 1994) (“[c]ompensatory damages are awarded

in order to make the injured party whole”).

The United States did not object in the district court to awarding damages in the

form of a trust, with any sums remaining at plaintiff’s death reverting to the government. 
13

This ensures that plaintiff does not receive a windfall. We have approved reversionary

trusts in FTCA cases involving large awards for future medical needs. See Hill v. United

States, 81 F.3d 118 (10th Cir.), cert. denied, 64 U.S.L.W. 3780 (U.S. Oct. 7, 1996); Hull

v. United States, 971 F.2d 1499 (10th Cir. 1992), cert. denied, 507 U.S. 1030 (1993). We

perceive no error in this aspect of the district court’s award.

IV

Finally, the United States argues that the $600,000 noneconomic damages awarded

by the district court were excessive. We review the award of noneconomic damages for

clear error, to determine whether “the award shocks the judicial conscience.” Miller v.

United States ex rel. Dep’t of the Army, 901 F.2d 894, 897 (10th Cir. 1990). Based on

the extent of plaintiff’s physical and emotional injuries he sustained as a result of the

VA’s malpractice, we cannot conclude that these noneconomic damage awards were

excessive.

AFFIRMED.