Federal Court Allows Doctor’s Data’s Third Amended Complaint Against Barrett, Quackwatch,  and Co-Conspirators…  It is going to be a Very Happy New Year…

I’ve been holding onto this article for a while so as to not disturb the happy holidays with thoughts about the scum and filth that inhabit our US health care system, attacking everything that competes with drugs, drugs, drugs, and more drugs.  But, Thanksgiving and Christmas are now behind us.  The turkey is gone, the family units are back in their own nests, and its time to catch up.

Opinion by Consumer Advocate  Tim Bolen 

De-licensed MD, Stephen Barrett, with his group of hateful, sleazy, websites (Quackwatch, etc.), coupled with the activities of the “skeptics” who have banded together to propel Barrett’s gangrenous articles to the top of Search Engines like Google, have had a long, free run – so far.  But it is all coming to an end, and that end is going to be VERY costly to the perpetrators – tens of millions of dollars, I predict, in court judgments alone. 

Then comes, after the judgment, the Collection Process, which could easily increase the amount collected to three times the original judgment.

The Doctor’s Data v Barrett Federal Court case in Chicago, Illinois is, without doubt, the most important court case in United States health care.  The primary, and underlying, issues in this case scream for resolution.  It has turned into an epic.  And, it is coming into the end game.

Not very often does it happen, in a court, that three years four months into a case the Plaintiff (Doctor’s Data) files a Motion asking the Court’s permission to file an Amended Complaint.  But that’s just, exactly, what attorneys for Doctor’s Data did. And four short weeks ago the judge in the case authorized that Third Amended Complaint.

It, absolutely, with no question, signals that the Judge in the case knows what Doctor’s Data knows, with certainty, that it is going to win this case. For the Third Amended Complaint is about adding more charges and additional damages to the record. 

Lots of additional damages.  Tens of millions of dollars of additional damages.

The Doctor’s Data v Barrett Federal Court complaint, itself, is a microcosm of what virtually EVERY cutting edge practitioner knows that Barrett and his cronies are about.  What Doctor’s Data charged Barrett and the co-defendants with is the same thing Barrett and the others do to every one of their victims – so victory, here, will be a victory for all – and, I might add, a template for further lawsuits from others.

More, the filing of the Third Amended Complaint indicates that Doctor’s Data knows WHERE it is going to get that money from – and I can tell you right now that it won’t be from Stephen Barrett – for he doesn’t have the millions of dollars Doctor’s Data is looking for.  Ask yourself “Why would Doctor’s Data file for MORE damages knowing Barrett doesn’t have the assets to sell to pay the damages?”

They’ll be going after the “alter-ego.”  That’s where the money is.

What is a legal “alter-ego?”

It can be a number of different things.  Most commonly, the legal “alter-ego” doctrine is used to penetrate a corporate veil to hold individual corporate board members and stockholders personally liable for damages caused by the corporation.  So, what does this mean?

There is a direct application of that corporate application mentioned above in two separate ways:  (1)  Quackwatch, Inc had Board Members besides Barrett and his wife.  (2)  The National Council Against Health Fraud (NCAHF) had a TWENTY member Board, details of which can be found here.  After Barrett, these people would be the first targets for collection of the awarded damages.  They were all, in effect, named in the original lawsuit.

But, there is a bigger, and better target…

I am, just below, going to repeat what I said in an earlier article.

From almost the first few dealings I’ve had with Stephen Barrett I’ve been of the opinion that he, Barrett, is NOT a real player; but only a figurehead; a token, mouthpiece, and puppet.  I’ve never thought he was any more than that.  He’s just not that bright – and he has never been able to hold any job of any importance.  His biggest assignment in his entire professional career was as a part-time (a few hours a week) MD in a mental ward in his hometown of Allentown, Pennsylvania.  And he couldn’t even hold down THAT job.  He was terminated.

So, tell me, how does a man of such professional incompetence design, author, edit, and disseminate, all by himself, the articles he supposedly writes on TWENTY-TWO websites?

In other words, the way I see it, is that Barrett, as the primary Defendant is being sued in his capacity as a figurehead; a token, mouthpiece, and puppet – a “mere shell” – which means…

There’s an alter-ego here, right in front of us, actually running the Defense case, and paying Barrett and the NCAHF’s legal bills all this time.

According to an article by Kent A. Halcutt “Piercing the Mystique of the Alter Ego Doctrine” printed in Practice Tips, referring to a similar case:

“Based upon the factual allegations in the complaint and the documentary evidence submitted by the plaintiffs, the district court found that the alter ego doctrine was applicable because the individual defendants used their California corporation as a “mere shell” in an attempt to avoid personal liability.  The court entered a default judgment in excess of $22 million against the corporate defendant and one of the individual defendants (the action was stayed against the other individual defendant, who had sought bankruptcy protection).

State and federal courts also may apply the alter ego doctrine to amend a judgment to add additional judgment debtors.  The rationale for this type of postjudgment relief is that “the court is not amending the judgment to add a new defendant but is merely inserting the correct name of the real defendant.”

However, to satisfy due process concerns the judgment creditor must establish the existence of an alter ego relationship and “that the new party controlled the litigation, thereby having had the opportunity to litigate.”

So, What does the Third Amended Complaint Contain?

Doctor’s Data wanted to reinstate one of it’s earlier claims – one that was Dismissed due to, at the time, lack of substantiation for the libel per quod claim.  It now has that substantiation.  And, the judge responded with the legal equivalent of “Yup.  You bet…”

Libel per quod is defined as:  Plaintiff must prove the special circumstances, that the audience understood the defamatory connotation, and special damages, that is, actual monetary loss.”


NOW COMES DOCTOR’S DATA, Inc., Plaintiff, by Augustine, Kern, and Levens, Ltd., and Kulwin, Masciopintoo & Kulwin, P.C., its attorneys, and respectfully moves this Court to enter an order granting Doctor’s Data leave to amend its complaint so that it can reinstate its per quod libel claim. In support, Doctor’s Data submits as follows:

  1. On September 28, 2010, Plaintiff filed its Second Amended Complaint in this cause (“Complaint”). [#25]
  2. Defendants answered the Complaint in October 2010. [#26] However, later, in January 2011, Defendants filed two motions to dismiss all counts of the Complaint, including

Count VI alleging libel per quod. [#38, 39]

  1. On November 22, 2011, Judge Chang dismissed DDI’s Count VI (libel per quod claim), reasoning that DDI had not alleged special damages with sufficient specificity to state a claim for libel per quod. [#85, pp. 20-21]
  2. Since Judge Chang’s ruling, DDI has identified significant special damages proximately caused by Defendants’ defamatory statements, including:
  3. DDI’s damages expert has identified several million dollars in DDI lost income and financial damages caused by Defendant’s libel, after analyzing DDI’s financial results and records. DDI disclosed to Defendants its expert’s damages report in an effort to prove damages on its claims, including but not limited to DDI’s libel per se claim. DDI incorporates herein its lengthy and detailed expert’s damages report, which DDI designated as confidential pursuant to the Court’s Protective Order. [#108].
  4. The cost to rehabilitate DDI’s reputation from Defendants’ defamation exceeds several hundred thousand dollars, according to a public relations firm and another firm specializing in online reputation remediation. DDI previously disclosed and produced to Defendants this information in conjunction with DDI’s Complaint and damages sought therein.
  5. DDI also suffered millions of dollars in higher insurance premiums and deductibles since being dropped by its longtime insurer in connection with four lawsuits fomented by Defendants. As with the damages discovery identified above, DDI produced to Defendants documentation relating to these insurance related damages, and DDI’s damages expert provides an analysis of these damages in his expert report as well.
  6. In light of the foregoing special damages (which DDI has now clearly established but was not in a position to allege with sufficient specificity at the time it filed its Complaint),

DDI seeks to amend Count VI of its complaint to conform to the proofs and allege a cause of action for libel per quod.

  1. Pursuant to Rule 15(a)(2) of the Federal Rule of Civil Procedure, “The court should freely give leave [to amend pleadings] when justice so requires.” F.R.C.P. 15(a)(2)
  2. The purpose of a complaint is to put the defendants on notice, and should be “freely amended or constructively amended as the case develops, as long as amendments do not unfairly surprise or prejudice the defendant.” Luckett v. Conlan, 561 F. Supp.2d 970, 974 (N.D. Ill. 2008); Umar v. Johnson, 173 F.R.D. 494, 503 (N.D. Ill. 1997).
  3. Here, Defendants cannot reasonably claim any unfair surprise or prejudice. First, from a liability perspective, DDI’s proposed per quod libel claim is substantively identical to the Complaint’s per se libel claim, which Defendants have vigorously defended throughout this litigation. Indeed, DDI’s proposed per quod libel claim is premised on the identical defamatory statements, long at issue in DDI’s per se libel claim in its Complaint.

Moreover, from a damages perspective, Defendants have long known about DDI’s special damages identified above (i.e., lost business revenue, reputational harm, and increased insurance costs) because DDI claimed these identical damages in discovery (and produced the same underlying damages documents and expert analysis) to support its other claims in its Complaint. Accordingly, because Defendants cannot claim unfair surprise or prejudice, DDI requests that this Court grant DDI’s proposed motion to amend its Complaint to add a per quod libel claim.

  1. Moreover, the Federal Rules of Civil Procedure provide that a Court may permit the amendment of pleadings as late as the pretrial conference which, in this instance, has not yet been scheduled. F.R.C.P. 16(c)(2)(B). Indeed, this Court has yet to set a schedule for the filing of dispositive motions, so no party has filed any dispositive motions, either.
  2. DDI’s motion is brought not for the purpose of delay and, if granted, will not cause any undue delay.
  3. A copy of Plaintiff’s proposed amended Count VI is attached hereto as Exhibit A.

WHEREFORE, DOCTOR’S DATA, INC., Plaintiff, prays that this Court enter an order granting DDI leave to file its Third Amended Complaint.

Respectfully Submitted,


This case just keeps getting better and better…

My guess, right about now, is that the attorneys for Doctor’s Data are shopping for the services of a Judgment Collection Service and getting some bids.  Barrett, and his cronies, are soon going to meet a hoard of people, with tattoos on their faces, photographing their belongings, and getting a GPS fix on their properties.

Stay tuned…

Tim Bolen – Consumer Advocate