$52 Million Punitive Verdict Against Insurer That Abandoned Patients and Physician in Opioid Deaths

In the summer of 2012, the New Mexico Medical Board began investigating Dr. Pawankumar Jain of Las Cruces after patients died from opioid medications he had prescribed. At least 17 people were dead. Among them were Ruben Bonilla Jr., a 43-year-old father of 11 who died in August 2010 from morphine his doctor had prescribed, and Serina Clark, 28 and the mother of three young children, who died days later from a similar combination of opioids and other drugs.

Dr. Jain carried a medical malpractice policy through Professional Underwriters Liability Insurance Company, a subsidiary of The Doctor's Company. By July 2012, PULIC had received notice through its broker of the physician's situation. Rather than record the deaths in its claims system, the insurer let the file go dark and then cancelled the policy. When the families of Ruben Bonilla Jr. and Serina Clark filed wrongful-death suits against Dr. Jain in August 2013, PULIC denied him any defense. The stated reason: the claims had not been reported on time. The insurer said nothing about the fact that its own broker had been aware of the deaths before the cancellation took effect.

Dr. Jain filed for bankruptcy. His trustee eventually settled with the plaintiffs for $680,000 and assigned to them the right to pursue the bad-faith claim against PULIC directly. That assignment became the legal vehicle for what followed.

Ben Davis and Zackeree Kelin of Davis Kelin Law Firm, working alongside Mollie McGraw of McGraw Law in Las Cruces, took the case to trial. They argued that PULIC had willfully buried notice of the patient deaths so it could later use untimely reporting as a pretext for denying coverage. A district court ruling in 2020 had already established that PULIC breached its contract and violated New Mexico's Unfair Practices Act. The trial on punitive damages went to the jury in January 2023.

On January 17, 2023, the jury returned a $52 million verdict in punitive damages, a figure that represented roughly half of PULIC's net worth at the time. No court record of a reduction or remittitur on appeal was identified in publicly available sources as of the date of publication.