Bankruptcy of jail’s medical provider complicates inmate-death lawsuit

The bankruptcy of the company that provides medical services at the Lane County Jail has prompted major changes to a lawsuit filed by the family of a woman who died after an alleged overdose at the jail.

The lawsuit, filed in January, alleges that Barbara Stillwell “obtained fentanyl and methamphetamine while inside her cell in the booking area of the county jail and overdosed there while in custody.” She is described in a lawsuit as dying one day after being booked into the jail in February 2023.

Stillwell’s husband, Perry Stillwell, has alleged negligence by Lane County and sheriff’s office officials, as well as a “delay and denial of essential care” by Wellpath, the company that provides jail health care services. A doctor and nurses involved in her care are also named as defendants.

The lawsuit, according to a July 25 court filing in U.S. District Court, contends the Stillwell estate is entitled to $5 million in compensatory damages.

But Wellpath now claims the details of its post-bankruptcy restructuring plan should halt Stillwell’s claims. Meanwhile, Lane County, a co-defendant in the lawsuit, has filed its own claims against Wellpath. The county seeks a court order forcing the company to help shoulder the burden of the Stillwell lawsuit and at least one other lawsuit related to the jail.

Wellpath, one of the largest companies providing jail health care in the United States, in recent years has paid millions to settle other lawsuits. However, a restructuring plan approved in May by a Texas bankruptcy court will affect pending claims.

An agreement with the company’s creditors included the creation of a $15.5 million trust from which unsecured creditors, including those with pending lawsuits, are to be paid — if those lawsuits against Wellpath even continue.

Wellpath filed a motion Aug. 8 calling for the dismissal of the Stillwell case, contending that a missed “opt-out” deadline for creditors prevents the legal claims against the company and its employees from moving forward.

The deadline was July 30 for “(c)urrent or former incarcerated individuals who hold claims” against the company, according to a public website hosting key documents and details of the company’s reorganization plan.

The opt-out exists because Wellpath’s reorganization plan “includes a provision that, by default, requires plaintiffs with claims against Wellpath to release claims against” Wellpath employees, said Devontae Torriente, a legal fellow with the National Police Accountability Project.

By submitting the opt-out form, those with lawsuits against Wellpath employees can effectively reject that provision, said Torriente, who has written critically of the company’s bankruptcy.

“However, plaintiffs who miss the deadline but had claims against Wellpath itself dating back to before the bankruptcy should, in general, still be able to pursue their legal claims in court. Any money they can get from those claims, however, will be limited based on what is available from the trust or insurance Wellpath may have,” Torriente said.

But he added that “it’s hard to speak too broadly because much of this is specific to the circumstances and claims themselves.”

Louren Oliveros, the attorney representing Perry Stillwell and the estate of Barbara Stillwell, did not respond to a message and email seeking comment, but on Monday, Aug. 18, Oliveros filed a court document saying a formal response to Wellpath’s motion for dismissal would be forthcoming.

The county, in a separate court document filed Aug. 8, has accused Wellpath of negligence in Stillwell’s death and breach of contract. It also asks a judge to order the company to “defend and indemnify” the Lane County defendants — in other words, to defend the county against Stillwell’s lawsuit and compensate it for any damages that might be awarded.

The director of marketing and communications for Wellpath, Joanie Brady, said in a statement that “it is our policy not to comment on current litigation.”

Sgt. Tim Wallace, a sheriff’s office spokesperson, also declined to comment on the lawsuit.

Spotlight on Wellpath

Wellpath’s voluntary bankruptcy filing last November caught the attention of those wondering how it might affect legal claims against it, in Oregon and beyond.

U.S. Sen. Elizabeth Warren, D-Mass., in a public letter this past December, urged Wellpath “to commit to ensuring fair payout to creditors, particularly incarcerated patients harmed by medical malpractice, as well as local health care providers and contracting partners.”

According to a document filed this past November in bankruptcy court, more than 1,500 lawsuits were pending against Wellpath and co-defendants, the “vast majority of which involve issues concerning the quality of medical care provided to incarcerated individuals.”

Among a half dozen or so open lawsuits filed in U.S. District Court in Oregon naming Wellpath as a defendant, one other case has a filing from Wellpath calling for a halt to claims against it. The case was filed by a man formerly incarcerated at the Douglas County Jail alleging negligence while being treated for a dental problem that resulted in permanent nerve damage.

In the Stillwell lawsuit, with both Lane County and Wellpath named as defendants, the county’s claim filed Aug. 8 against Wellpath is what’s known as a cross-claim, which involves one defendant in a lawsuit filing a claim against another defendant.

The county’s cross-claim alleges negligence “(i)n one or more of the following particulars,” including “in failing to adequately assess and monitor” Stillwell or “(i)n failing generally to respond properly to Barbara Stillwell’s serious medical needs before, during, and after her overdose,” among other claims, which include wrongful death.

The cross-claim states that the damages to Stillwell, “if any, were caused in whole or in part by the negligence of the Wellpath defendants.”

In the filing, the county also formally denied the claims that Stillwell obtained the illicit drugs while in jail.

The Stillwell lawsuit contends that the jail, “through its employees and agents, failed to implement drug detection and monitoring procedures such that fentanyl and methamphetamine were available to and easily accessed by adults in custody, including Mrs. Stillwell, who was known to be suffering from addiction.”

Claims against the county include a violation of constitutional rights, as well as wrongful death.

Among several legal defenses listed by the county in its court document, including qualified immunity, the county asserts that Stillwell’s death was “caused by her negligence in one or more of the following particulars,” including “(b)ringing illegal and harmful substances into the Lane County Jail” or consuming those substances.

The response was filed on behalf of the county and also Lane County Sheriff’s Office officials and employees named in the lawsuit — including former Sheriff Cliff Harrold and current Sheriff Carl Wilkerson, who was chief deputy in 2023.

Other cases

The Stillwell lawsuit is not the only court case involving Lane County and Wellpath.

A woman has alleged misconduct by the county and McKenzie-Willamette Medical Center in connection with a body cavity search, according to a lawsuit filed in Lane County Circuit Court.

In that lawsuit, the county in January filed a third-party claim stating that if it’s found liable for damages, “then Wellpath is liable to Lane County. ” Lane County formally filed a claim in Wellpath’s bankruptcy proceedings seeking indemnity in the case.

Wallace, the sheriff’s office spokesperson, confirmed that Wellpath remains under contract to provide medical services at the jail.

Contract extension

According to a 2022 document prepared for county commissioners, Wellpath was the only company to respond to the county’s request for proposals for providing medical services at the jail.

Wellpath and the county agreed to a three-year contract beginning July 1, 2022, to be followed by two optional one-year renewals, according to a letter from Wellpath filed by the county in the company’s bankruptcy case.

County commissioners in June approved the first one-year renewal, agreeing to a $7.6 million contract amendment with Wellpath.

Documents on the county’s website describe $26.3 million going to Wellpath for medical services provided over the four years, from July 2022 through June 2026.

The 2022 county document stated that four companies submitted proposals in response to a previous request in 2015. The company selected in 2015, California Forensic Medical Group, merged with another company to form Wellpath in 2019.

“Consolidation has occurred in the corrections medical care sector since 2015,” the 2022 county document stated.