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Federal Government To Pay $5M To Settle Baby Brain Damage Lawsuit

A baby born years ago in an upstate New York government-funded hospital suffered brain damage during her birth. A lawsuit, filed in October 2016, was brought against the government for damages. After a long battle, the Federal government has agreed to settle for $5 million. The case, known as S.B. et al v. United States Of America et al, via a Stipulation for Compromise Settlement and Release of Federal Tort Claims Act Claims Pursuant to 28 U.S.C. § 2677.

Though this birth injury settlement is large, it’s important to know that payment can be just as complex as the case was itself. That is very true in this case. Here’s an overview of what you should know when you file a medical malpractice case and hope to obtain just and fair compensation.

How Will the $5M Settlement Be Paid Out in the S.B. Birth Injury Case?

A $5 million settlement is pretty dramatic. But it’s important to know how it is distributed because you don’t get a lump sum. Plus, you will likely have obligations to fulfill in order to keep the payments coming. In the case of S.B. et al v. United States Of America et al, the funds are to be settled in the following manner.

  • a cash sum of $2,125,000, which will be distributed to various parties, like:
    • Medicaid or Medicare liens,
    • attorney fees not to exceed 25% of the settlement,
    • Plaintiff;
  • $475,000 for the purchase of the annuity premium contract;
  • $2,150,000 for the purchase of a second annuity premium contact;
  • $250,000 for a deposit in a Reversionary Trust, funded by the annuity contacts in the amount of $2,333.62 per month, increasing at 4% compounded annually and continuing for 45 years.

How the cash sum should be distributed is also broken down more specifically in the Stipulation. Terms are also established on the purchase of the annuity contracts and when any necessary changes can or should be made.

The Plaintiffs, according to the Stipulation, must provide proof of life on an annual basis. Payment to the Reversionary Trust could stop if the proof of life is not provided. Further, if the child dies, the Plaintiff must provide a certificate of death. At such time of the child’s death, the Stipulation bars the Plaintiff’s right to sue the Federal Government for wrongful death.

The settlement payment process is actually quite complex – just as complex as the case itself was.

What Can You Expect From Your Birth Injury Settlement?

Each case is different in birth injuries. Settlements can take months to transpire. So, it’s difficult to say what you can actually expect to take home after a birth injury settlement. The big settlements you see in news clips, including this large one in the amount of $5 million, do not identify where the money actually goes. The same is true for smaller settlements and verdicts.

Below is what you can expect to be deducted before you receive your settlement or award:

  • attorney’s fees – though in the above case, the attorney’s fees are not to exceed 25%, the typical percentage is 33%
  • client expenses – the attorney usually bears the risk of expenses, and so if you lose, the attorney doesn’t require you reimburse, but if you win, reimbursement will come from the settlement or award, and these expenses usually include things like expert testimony fees, postage fees, filing fees, etc.
  • medical bills and medical liens – your health insurance company may have covered much of the medical expenses, and it will be paid back via any recovery from your lawsuit.

If you have questions about a birth injury and want to file a lawsuit, you should speak with experienced birth injury attorneys today. A birth injury attorney who believes an informed client is a better client is the type of attorney who will make sure you get what you expect and deserve.

About the Author

Briggs Bedigian
Briggs Bedigian

H. Briggs Bedigian (“Briggs”) is a founding partner of Gilman & Bedigian, LLC.  Prior to forming Gilman & Bedigian, LLC, Briggs was a partner at Wais, Vogelstein and Bedigian, LLC, where he was the head of the firm’s litigation practice.  Briggs’ legal practice is focused on representing clients involved in medical malpractice and catastrophic personal injury cases. 


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