Nearly $1M settlement reached in Sunnyside Child Care suit

Aug. 18--Roughly a year after parents sued Sunnyside Child Care Center over a staph outbreak that sent 86 children to the emergency room, a settlement has been reached.

Court records show that the day care's insurance provider, Mesa Underwriters Specialty Insurance Company, has agreed to pay out the balance of the policy -- $985,000 -- which will go toward the plaintiffs.

In the midst of litigation, a dispute arose regarding who was to pay additional court fees. Because the suit is filed on behalf of minors, a court-appointed guardian (usually a third-party attorney) must be hired to oversee the settlement and make sure it's fair.

Attorneys representing the parents and children said they suggested letting the judge decide who would pay the fees for the court-appointed guardian, and that insurance adjusters agreed.

Then on July 18, John Hanlon, one of the insurance adjusters, sent an email to the plaintiffs' attorneys rescinding the offer which both parties had accepted the previous Friday, the plaintiffs' motion asserts.

"Mesa has offered to pay our remaining policy limits of $985,000 ... (court-appointed guardian fees) are the plaintiffs' costs to bear. If this is not acceptable there is no settlement," a court exhibit showed that Hanlon wrote in an email to Joe Hubbard, one of the attorneys representing the plantiffs.

Hanlon could not be reached for comment. Mark Smith, another adjuster involved in the suit, declined to comment.

"It began this drawn-out, exhausting debate of Alabama law procedure and practice with a Pennsylvania insurance adjuster," Hubbard said.

Judge Truman Hobbs on Tuesday ordered Hanlon to appear in Montgomery County Circuit Court on Friday to discuss the dispute. But the matter was resolved Monday night when Mesa agreed to pay $1,2500 in half the guardian fees, stated an email from Mesa's legal counsel.

On the morning of the day-care outbreak, the children became ill with vomiting, nausea and diarrhea. Some parents later said their children's arms, legs and faces broke out in boils as a result of the infection.

The Alabama Department of Public Health confirmed that was found growing in food served to the children, which caused their illness.

Most of the children were ages 4-10 at the time of the outbreak, but some were as young as 2. Sunnyside, the "church-exempt" day care, was not required by law to be licensed or abide by minimum state standards.

"Myself and other lawyers on this case have been working very hard to get this resolved for these children and the parents so they can move on, and put this very traumatic incident behind them," Hubbard said.

"We're proud to we had gotten to a point where we had done all we could do to do that and it's just a shame that some insurance adjuster in Pennsylvania tries submarine the whole deal."

This story has been updated to reflect that Mesa agreed to pay guardian ad litem fees, which was previously holding up the settlement agreement.

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