MLFCCA

A Duluth judge has ruled that it should be up to a jury to decide whether Essentia Health is liable for damages after one of its former psychotherapists borrowed more than $100,000 from a patient and didn’t repay it.

A Duluth businesswoman filed a malpractice and personal injury suit against licensed psychotherapist Catherine Nelles Anderson and the therapist’s former employer, the SMDC Corp. and Duluth Clinic, now known as Essentia Health. The lawsuit alleges that in the course of assessment and treatment, Anderson negligently allowed an apparent personal relationship to develop with her patient by failing to maintain proper professional boundaries to a standard expected of a psychotherapist.

The suit claims SMDC is vicariously liable for Anderson’s negligence, breach of fiduciary duty, fraud and misrepresentation, failure to treat and financial exploitation of a vulnerable adult on the theory of “respondeat superior,” where an employer can be liable for an employee acting within the scope of employment.

As a result of Anderson’s alleged negligence, the plaintiff claims she has suffered and will continue to suffer remorse, humiliation, mental anguish, exacerbation of her depression, post-traumatic stress, loss of respect of friends and family and financial suffering.

In an order made public Monday, Judge Shaun Floerke denied the health system’s motion for summary judgment and scheduled a trial for August.

Floerke wrote in his order: “The psychotherapy

occurred during SMDC operating hours and in Ms. Anderson’s office on SMDC property, and failure to provide psychotherapy in a manner that falls within professional guidelines is reasonably foreseeable conduct by a service provider. Because (the plaintiff) has asserted facts that, if proved, would allow a jury to find SMCD vicariously liable for Ms. Anderson’s alleged negligence, the motion to dismiss the negligence claim against SMDC is denied.”

Anderson provided psychotherapy treatment to the plaintiff from 2003 through 2006. Between 2005 and 2006, Anderson borrowed $101,500 from the plaintiff to remodel and repair her home. She has not repaid any of the money.

Floerke also wrote in his order that the plaintiff at trial will need to provide evidence of when and where Anderson borrowed the money to recover damages from Essentia. SMDC fired Anderson in April 2006 after learning of her conduct.

“My client is pleased with the judge’s decision in the matter,” said Duluth attorney David Malban, who represents the plaintiff. “I think it correctly lays out the facts of our case and the law regarding it. We’re looking forward to proceeding with the trial and getting our whole case out in front of a jury.”

Duluth attorney Charles Bateman represents the health system. He argued to the court in a February hearing that while there is no argument that Anderson owes the woman $101,500, the case against SMDC should be dismissed. SMDC also sought a partial summary judgment against Anderson in favor of the plaintiff. The court also denied that motion.

At the February hearing, Bateman said Anderson’s conduct in borrowing money from her patient was outside the course and scope of her employment with SMDC, unforeseeable by her employer, completely personal and a substantial deviation from her employment duties.

When asked for comment Monday on the case being set for trial, Bateman said: “I don’t argue legal cases in the newspaper and no one else should either.”

Anderson has moved to Seattle and has declined to comment on the lawsuit.