Malpractice Lawyers Help Fed Indict Schneider

Malpractice Lawyers Helped Federal Prosecutors Indict Kansas Dr. Schneider; Roxana Hegeman; Associated Press; 2008-02-06.

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HAYSVILLE, Kan. (AP) — Malpractice attorneys worked closely with federal prosecutors to help indict a Kansas doctor accused of illegally prescribing painkillers linked to the overdose deaths of 56 patients, attorneys acknowledged in interviews and in documents obtained by The Associated Press.

While the malpractice attorneys contend their help wasn’t improper, supporters of Dr. Stephen Schneider and his wife, nurse Linda Schneider, contend the close involvement by malpractice attorneys representing plaintiffs in civil lawsuits against the doctor taints the federal prosecution.

The Schneiders were indicted in December on 34 federal counts, including four counts of unlawful distribution and dispensing of control substances resulting in death. The indictment accuses the Haysville couple of directly causing four deaths and contributing to at least 11 others. The couple has pleaded not guilty.

The AP analyzed court documents filed in numerous civil lawsuits against Stephen Schneider over the past several years and found that the bulk of the death cases in the indictment were first filed as malpractice lawsuits by two Wichita attorneys, Andrew Hutton and Larry Wall.

Their findings, as set out in exhibits filed in those civil cases, are used throughout the criminal indictment — sometimes verbatim.

Both Wall and Hutton acknowledged cooperating with the U.S. attorney’s office but said the prosecutors did not share the government’s evidence with the malpractice attorneys.

“They relied on a lot of information that we created — the depositions, transcripts and affidavits — but they did a lot of work themselves,” Hutton said, noting federal raids at Schneider Medical Clinic on Sept. 13, 2005, and March 28, 2006, also yielded boxes of evidence.

And Hutton insisted most clients who lost family members to prescription drug overdoses were more concerned about putting Stephen Schneider out of business than with collecting money from their lawsuits.

But Pain Relief Network, a New Mexico-based patients rights group that has come to the defense of the Schneiders, contends the malpractice attorneys and their clients stand to gain from a criminal indictment that justifies their lawsuits.

“A lot of people are benefiting from it financially. Ultimately, that makes all of these victims not credible,” said Siobhan Reynolds, president of the Pain Relief Network. “It appears to be their payment - their carrot in addition to whatever sticks the prosecutor can bring to bear.”

The U.S. attorney’s office declined to discuss its investigation of the Schneiders, who also face charges of conspiracy, health care fraud, illegal money transactions and money laundering.

But a June 26, 2007, letter written by Assistant U.S. Attorney Tanya Threadway and recently obtained by the AP confirmed that Hutton and Wall were cooperating with prosecutors. However, in the letter, Threadway denied accusations in a defense motion that she was using the civil discovery process to investigate the doctor.

In the letter to Chicago attorney David Schippers, who represents the Schneiders, Threadway said Wall and Hutton agreed to provide her with depositions, exhibits and motions from the lawsuits — cooperation she said was appreciated because it eliminated the need to issue subpoenas.

Wall also told Schippers in a May 29, 2007, letter that his office was cooperating with the federal investigation: “We are sharing all of the depositions and exhibits, and we intend to continue this complete cooperation throughout litigation.”

Hutton told the AP that he and Wall focused on the medical part of the case, while federal prosecutors focused on billing and health care fraud.

Wichita attorney Dan Monnat, who does not represent any party in the Schneider cases, said that prosecutors and the civil attorneys handled their involvement in an upfront and professional manner.

“A certain amount of cooperation is expected of people with their government in the investigation of crime. We like it when people are given the chance to voluntarily cooperate, rather than when threatened with prosecution and prison if they don’t cooperate,” he said.

Wall represents the heirs of at least five patients whose deaths are mentioned in the federal indictment, including one of the four deaths the government contends the Schneiders directly caused.

Hutton represents the families of four patients whose deaths are referenced in the indictment, including one of the alleged direct deaths. In at least two of Hutton’s earliest patient cases he turned over to the prosecutors, the statute of limitations had passed on filing civil lawsuits.

Both attorneys also represent additional clients in other patient cases against the Schneiders, and they are looking at taking on additional cases.

Wall said that even if the government seizes all of the doctor’s assets, his clients can still collect from malpractice insurance policies held by the doctor and clinic.

“But these cases on behalf of these injured patients and the heirs have never been about the money,” Wall said.

Still, Hutton acknowledged that the criminal action may have played a part in Stephen Schneider’s decision to settle two civil cases.

“It makes the defense lawyers less desirous of trying the case when they have some doctor who is also a criminal defendant.”

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