Plaintiffs are represented, Michael Kuharski, Esq. of Kuharski Levitz & Giovinazzo, Staten Island, New York, and by Kevin Dean, Esq. of Motley Rice, LLC, Mount Pleasant, South Carolina.
Defendant RTI Donor Services is represented by Joseph D'Avanzo, Esq. of the Law Office of D'Avanzo & Morreale, P.C., White Plains, New York, and defendants RTI Biologics and Tutogen United States are represented by Nancy Ledy-Gurren, Esq. of the law firm of Ledy-Gurren, Bass & Siff, LLP, New York, New York.
Joseph J. Maltese, Justice of the Supreme Court.
In these coordinated mass tort actions of first impression, this court is called upon to evaluate the boundaries of civil liability in the procurement of human tissue for processing from decedents, without the consent of the decedent before their death or the consent of their next kin after death.
This court ordered that 22 of the pending 46 actions coordinated for discovery are certified as "trial ready." The defendants, RTI Donor Services, Inc., RTI Biologics, Inc. f/k/a Regeneration Technologies, Inc. and Tutogen Medical (United States), Inc., made a motion to dismiss all of the claims by all of the plaintiffs. Those defendants also made four more specific motions to dismiss against selected plaintiffs.
Defendant, Michael Mastromarino, a former dentist, entered into the business of harvesting human tissue, organs and bone for distribution to the defendant tissue processors that redistributed them for use in the healthcare industry. On March 8, 2002, the defendant, RTI Donor Services, then known as U.S. Allograft Network, Inc., contracted with Mastromarino's organ and tissue harvesting company, Biomedical Tissue Services, Inc. ("BTS") to provide it with human tissue for processing and distribution. Under section 1 of the agreement BTS was responsible to "[s]upply Donor Recoveries (Femurs and Tibias) exclusively to USAN (US Allograft Network) which meet USAN's Acceptance Criteria... and other requirements for quality control and assurance, as provided by USAN." Pursuant to their agreement, " Musculoskeletal Donor Recovery' shall mean hemi-pelvis, femur, fibula or tibia." Michael Mastromarino executed the agreement as Michael Mastromarino, "M.D., " on behalf of BTS and Thomas E. Brewer executed the agreement on behalf of U.S. Allograft Network, Inc.
At the request of RTI's management, their attorney, Jerome Hoffman's firm conducted an investigation into Michael Mastromarino's background. Hoffman's investigator's wrote a report that discovered the following information:
New Jersey Criminal History: 1) an arrest on July 7, 2000 for possession of controlled dangerous substance and for use or being under the influence of any controlled substance, 2) charged with possession or distribution of a hypodermic syringe or needle, and 3) these charges were resolved by pre-trial intervention and fined $1250.00.
New York Criminal History: Misdemeanor for unlawful use of a police uniform or emblem.
Dental Licensure: New York state suspended Mastromarino's license on two separate occasions, and that Mastromarino practiced dentistry while his license was suspended; In New Jersey Mastromarino voluntarily surrendered his license.
An internal memo demonstrates that RTI began to question its business relationship with Mastromarino. Outside counsel, Jerome Hoffman, Esq., in an e-mail warned RTI management in December 2002 that, "The good doctor has been on Santa's naughty list for quite some time. I would strongly encourage you not to do business with someone that has this kind of resume."
In a second separate e-mail dated January 7, 2003, Attorney Hoffman once again counseled RTI management that:
Given that the issue is whether it makes good business sense to continue a relationship with someone with a background like Dr. Mastromarino, and not whether the contract has been breached, I suggest that we give him the required 60 days notice under the current contract and not sign a new contract with either BioTissue or Bio Medical.
But RTI did not give Mastromarino sixty days notice of termination as counseled by Attorney Hoffman and continued doing business with him and BTS. Rather than cancel the March 8, 2002 contract, on February 11, 2003 Mary Basco, Medical Director for BTS and Carrie Hartill, RTI Vice President for Quality Assurance and Regulatory Affairs amended the March 8, 2002 agreement to state:
Recovery Agency will, for the term of this Agreement, maintain current licensure/registration with applicable State and Federal Agencies, and is either Accredited by the American Association of Tissue Banks (AATB) or meets AATB Standards. Recovery Agency will provide evidence of such upon request.
RTI reserves the right to audit/inspect the agency no less than once a year.
On February 1, 2003 BTS and RTI executed a new Tissue Recovery Agreement. The agreement states "For the purposes of this Agreement Musculoskeletal Donor Recovery' shall mean hemi-pelvis, femur, fibula, or tibia." Similar to the agreement between BTS and U.S. Allograft Network, Inc., BTS agreed to, "[s]upply Donor Recoveries (Femurs and Tibias) exclusively to RTI which meet RTI's Acceptance Criteria and other requirement for quality control and assurance, as provided, from time to time, by RTI." Once again, Mary Basco executed the agreement on behalf of BTS; and Roger Rose, Vice President executed the agreement on behalf of RTI.
Shortly thereafter the parties executed an amendment to the February 1, 2003 Tissue Recovery Agreement which expanded the scope of the tissue agreement. On April 10, 2003 the parties expanded their agreement as follows:
Recovery Agency [BTS] and RTI wish to amend the purpose of the Agreement by adding Cardiovascular Donor Recovery, meaning heart of valves, saphenous veins, femoral artery & veins en bloc, descending aorta and aortoliliac.
On June 1, 2004 the parties once again amended the February 1, 2003 agreement. This amendment concerned Article I, section 1 which dealt with BTS's agreement to provide RTI with femurs and tibias exclusively. The amendment reads:
Article I. (1) shall be amended to read:
1. Femur, Tibia Humerus, Radius, Ulna and Cardiovascular Recoveries exclusively to RTI which meet RTI's Acceptance Criteria and other requirements for quality control and assurance, as provided from time to time by RTI.
Shortly after one year from the execution of this tissue agreement the parties executed a new agreement effective on June 29, 2005, which states:
BioMedical and RTI entered into a Tissue Recovery Agreement dated February 1, 2003, and Amendments dated April 10, 2003 and June 1, 2004 which the parties wish to terminate and replace with this Agreement, effective June 29, 2005.
This agreement was executed by Michael Mastromarino as President/CEO of BTS and Roger W. Rose, Executive Vice President of RTI. Unlike the previous agreements between the parties this agreement ...