Judge denies motion to dismiss some claims in dispute over MRI equipment at Metairie medical facility

By Karen Kidd | Nov 15, 2018

NEW ORLEANS – A medical equipment company that sold a Metairie medical facility a magnetic resonance imaging (MRI) package that allegedly doesn't work, despite several years of installation, remains fully on the hook in the medical facility's federal lawsuit.

In his 25-page order filed Nov. 8, U.S. District Judge Barry Weldon Ashe in Louisiana's Eastern District denied a motion for partial summary judgment filed by Philips Healthcare, a division of Philips Electronics North America Corp., seeking the partial summary judgment regarding some of the claims by plaintiff NAZ LCC, under the Louisiana Products Liability Act. NAZ operates Advanced Neurodiagnostic Center in Metairie.

"This litigation arises from a medical facility's purchase of allegedly faulty MRI equipment, the manufacturer's allegedly faulty installation and service of the MRI equipment, as well as its failure to provide the purchaser with the 'complete package,' including the hardware and software components that should have been delivered when the MRI equipment was installed," Ashe wrote in his order.

Philips won't be seeing any additional allegations in the case, for now, as Ashe also affirmed a magistrate judge's previous decision to deny a NAZ's request to file a second amended complaint.

In that part of his order, Ashe agreed with the magistrate judge's finding "that amendment would be futile because plaintiffs' proposed amended complaint does not add new theories of recovery under which plaintiffs could recover."

NAZ wanted to add fraud-based allegations to its proposed second amended complaint relative to Philips' presentation to Dr. Morteza Shamsnia, a principal of NAZ and Advanced Neurodiagnostic Center, in the lead up to the signing of the agreement to install the MRI equipment. At issue were revisions to the agreement that NAZ counsel admitted Shamsnia did have at the time, which NAZ claimed amounted to fraud under the Louisiana Unfair Trade Practices Act (LUPTA).

"Dr. Shamsnia, a highly educated person, could have read Revision 12 and compared it to Revision 10 to ascertain the differences," Ashe's order said. "Thus, Philips did not attempt to conceal information from Dr. Shamsnia as would constitute fraud or violations of LUTPA. Therefore, the magistrate judge's order denying plaintiffs' motion for leave to file a second amended complaint is neither clearly erroneous nor contrary to law and, consequently, is affirmed."

At issue in the case is the MRI package installed in late 2014 that has been offline more often than it has been online due to myriad issues, according to the lawsuit filed in April 2017. Among multiple issues described in the litigation is the approximately $850,000 in damage sustained by the MRI after Philips engineers made an opening in the roof that allowed a substantial amount of water to enter the facility during a storm on Jan. 15, 2015.

Philips faces allegations of gross fault, breaches of contract and bad faith.

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