Pegram v. Herdrich

Carle Clinic Association (defendant), a physician-owned HMO, employed Dr. Lori Pegram (defendant), who examined patient Cynthia Herdrich (plaintiff) for groin pain and, upon discovering an abdominal mass, decided Herdrich should wait eight days for an ultrasound at a distant Carle facility rather than ordering one immediately despite noticeable inflammation; before the eight days passed, Herdrich's appendix ruptured, causing peritonitis. Herdrich sued for medical malpractice and later added an ERISA breach-of-fiduciary-duty claim, alleging Carle's physician-ownership structure incentivized decisions maximizing profit over patient care; after a jury found for Herdrich on the malpractice claims, the ERISA claim's dismissal was reversed by an intermediate appellate court, prompting Carle and Pegram's Supreme Court appeal.