Government indicts malpractice lawyer for allegedly trying to extort millions from Baltimore hospital

UMMC-Gudelsky-300x168A Maryland attorney has been indicted by the U.S. Department of Justice for an alleged scheme seeking a multi-million dollar payoff by the University of Maryland Medical System. Attorney Stephen Snyder is alleged by the government to have proposed a sham “consulting agreement” with the hospital, which would pay him $25 million, in order to keep secret some alleged facts about the hospital that he had learned in the course of representing a patient’s family.

Readers might wonder why our blog that focuses on patient safety and medical malpractice would write about this. Here’s why. We believe that attorneys who represent patients in medical malpractice lawsuits have an ethical duty to look out for the public’s interest, not just the narrow interests of themselves or even of their clients. That means that when a lawyer finds out in the course of representing someone that a hospital has a big patient safety problem, the lawyer should not try to personally profit from that knowledge by keeping quiet.

The Snyder indictment involves allegations about the organ transplant program at UMMS. (The building for the program is shown in the photo on the right.)

Here is an excerpt from the government’s announcement of the Snyder indictment:

According to the eight-count indictment, between January and October 2018, Snyder attempted to obtain $25 million from the University of Maryland Medical System (UMMS) for himself, separate and apart from any claim by one of his clients, by using threats of economic and reputational harm to UMMS and its organ transplant program.  Specifically, the indictment alleges that Snyder threatened that if UMMS did not pay him $25 million, Snyder would launch a public relations campaign against UMMS that alleged, among other things, that UMMS transplanted diseased organs into unsophisticated patients without informing them of the quality of the organs they were receiving in order to generate revenue.  According to the indictment, Snyder told UMMS officials that the campaign would include: a front-page article in the Baltimore Sun; other national news stories; a press conference; advertisements on the Internet, including one that would run every time someone accessed the UMMS transplant site; and at least two videos Snyder produced and would air if his demand for a $25 million payment were not met.

Snyder allegedly demanded that UMMS disguise the $25 million payment as a sham consulting arrangement between Snyder and UMMS.  Snyder also allegedly threatened that a lawyer (Lawyer 1) working for the insurance program insuring UMMS and its faculty physician groups would lose her job and threatened to harm the professional reputation of a UMMS doctor (Doctor 1) if they did not aid Snyder in obtaining the $25 million payment.

As detailed in the indictment, Snyder represented the spouse of a transplant patient who had died (Client 2).  During a settlement conference that included the lawyer and doctor mentioned above, Snyder demanded a $25 million settlement for his client.  In a later meeting, Snyder allegedly told UMMS representatives, including Lawyer 1 and Doctor 1, that the Client 2 case was “not worth that much money” and that Client 2’s case was worth between $3 and $5 million.  Snyder confirmed several times that the $25 million would be a payment made just to him and would be in addition to the payment made to Client 2’s spouse to settle her case.  When asked what he could do for $25 million, he told the UMMS representatives that he didn’t know, didn’t care, and could be “a janitor” at UMMS.

This blog reported in July about proceedings against Mr. Snyder’s license to practice law by Maryland’s Attorney Grievance Commission. Snyder denied the commission’s charges and maintained he was actually trying to help the hospital do better by its patients.

We discuss on our website why secrecy in settling lawsuits is bad for the public and bad for injured patients. 

Among other things, we say:

The civil justice system exists to help make the world safer and to prevent injuries. Many of our clients come to us saying, “It’s not so much the money. I just don’t want this to happen to someone else.” Secrecy provisions in settlement agreements undercut this important goal of the civil justice system, because they don’t let lawyers like us and our clients talk about the safety lessons we learned from a case. Secrecy also lets the same thing happen to other victims when the problem gets buried rather than fixed. Witness the Ford Explorer rollover cases and the clergy sex abuse scandals.

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