## Facts

- Michael Hodesh sued Dr. Joel Korelitz, Cincinnati General Surgeons, Inc., and Jewish Hospital of Cincinnati for medical malpractice, alleging a towel was left in his abdomen during surgery.
- About two and a half weeks before trial, Hodesh and Jewish Hospital executed a written “Contingency Agreement” that capped the hospital’s exposure at $250,000 and guaranteed Hodesh at least $175,000.
- On the first day of trial, Korelitz requested disclosure of any agreements between Hodesh and Jewish Hospital.
- The trial court ordered the agreement submitted for in camera handling; the judge did not read it, found no evidence of collusion, sealed it, and did not disclose it to the jury.
- The jury found Korelitz negligent and awarded Hodesh $775,000, but found Jewish Hospital not liable.
- After the verdict, Korelitz received a copy of the sealed agreement and appealed.

## Issues

1. Whether the contingency agreement between Hodesh and Jewish Hospital was a Mary Carter agreement requiring disclosure to the jury.
2. Whether the trial court abused its discretion by not disclosing the agreement to the jury.

## Decision

- The Supreme Court of Ohio reversed the court of appeals and reinstated the trial court’s judgment.
- The court reaffirmed that Mary Carter agreements must be disclosed to the jury.
- The court held the agreement at issue was not a Mary Carter agreement.
- Because the agreement lacked Mary Carter features and there was no evidence of collusion, the trial court did not abuse its discretion in declining disclosure.

## Legal Principles

- A Mary Carter agreement must be disclosed to the jury.
- A defining feature of a Mary Carter agreement is a provision reducing the settling defendant’s liability in proportion to an increase in the nonsettling defendant’s liability, creating an incentive to aid the plaintiff against the remaining defendant.
- Settlement agreements are generally valid absent collusion or bad faith to the detriment of nonsettling parties.
- Whether to disclose a non–Mary Carter settlement to the jury is reviewed for abuse of discretion; nondisclosure is not reversible error absent Mary Carter characteristics or collusion.

## Conclusion

The court held that jury disclosure is mandatory for Mary Carter agreements, but the plaintiff–hospital agreement here was a permissible capped arrangement without a liability-shifting incentive tied to the verdict against the nonsettling defendant, so nondisclosure was within the trial court’s discretion.


Hodesh v. Korelitz, 914 N.E.2d 186 (Ohio 2009)