A Las Vegas jury on Tuesday awarded $524 million, including $500 million in punitive damages, against UnitedHealth Group Inc. units in connection with a hepatitis outbreak tied to a doctor who was credentialed by the insurer.

Plaintiff attorney Robert Eglet, of law firm Eglet Wall Christiansen in Las Vegas, said between 2004 and 2008, there were 200 cases of hepatitis C tied to two endoscopy clinics run by gastroenterologist Dr. Dipak Desai, who had been credentialed by UnitedHealth.

The jury verdicts were issued to Helen Meyer and Bonnie Brunson, who had contracted hepatitis, and Ms. Brunson's husband, Carl Brunson, who had sued for loss of consortium. Defendants in the case were UnitedHealth units Health Plan of Nevada Inc. and Sierra Health Services Inc.

Dr. Desai was accused of using unsanitary practices in colonoscopies. Mr. Eglet said Dr. Desai had performed endoscopies that should have taken 30 minutes, in less than five. He said he represents 23 other plaintiffs in connection with the case, with the next trial scheduled for December.

Mr. Eglet said Dr. Desai had been dropped as a preferred provider from UnitedHealth's health maintenance organization in 1992, but the HMO took him on again several years later because he performed endoscopies at a low cost. He said Minnetonka, Minn.-based UnitedHealth had ignored warnings from other physicians in the community that Dr. Desai was dangerous and never informed its credentialing committee of the warnings.

Commenting on the jury verdict, Health Plan of Nevada said in a statement: “The number announced today has no grounding whatsoever in reality — it represents fantasy damages, not punitive damages. We have a compelling case for appeal since the jurors were barred from hearing extensive evidence and testimony about how Dr. Desai's covert, criminal practices were hidden from the entire community, including Health Plan of Nevada.”

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The insurer said that the jury did not hear that Dr. Desai has been criminally charged for the outbreak and that the same plaintiffs had already sued and received damages awards from a pharmaceutical company. In addition, it said that Dr. Desai was credentialed or accredited by other HMOs, hospitals and the Accreditation Association for Ambulatory Health Care.

“Even more troubling, the court held that placing Dr. Desai in (HealthCare of Nevada's) network caused the plaintiffs to contract hepatitis C because: (1) plaintiffs' hepatitis C was the result of Desai's medical malpractice; and (2) a doctor's medical malpractice is always a foreseeable consequence of placing a doctor in a health plan's network. If allowed to stand, this would have a devastating impact on the availability and affordability of health insurance in Nevada,” the statement said.

In 2010, Jerusalem-based Teva Pharmaceutical Industries Ltd. announced a Las Vegas jury awarded $356 million in punitive damages against its Teva Parenteral Medicines Inc. unit in connection with its propofol anesthetic, which reportedly was used in the colonoscopies. According to media reports, the company subsequently agreed to pay $250 million to settle more than 80 lawsuits over propofol sales. News reports say the issue was that Teva sold the anesthetic in oversized vials that invited reuse, which led to the hepatitis being spread. A Teva spokesman could not be reached.

Helen Mayer as individual v. Health Plan of Nevada et al. and Bonnie J. and Carl Brunson, individually and as husband and wife vs. Health Plan of Nevada et al. were filed in January, 2010.