Jury says ex-doctor must pay patient

The patient of former psychiatrist James Dallman may not receive much of the $780,000 the jury awarded her.

Friday December 12, 1997

By Lynn Moore CHRONICLE STAFF WRITER

Former Muskegon psychiatrist James Dallman was ordered Friday by a local jury to pay $780,000 to one of his former patients who alleges he raped her in his office.

However, it's questionable how much of the money she'll ever collect since a divorce settlement earlier this week gave most of Dallman's assets to his ex-wife. He also lied on a malpractice insurance application, which a court decided made his insurance policy void.

The civil suit was the first of several lawsuits patients have brought against Dallman, who lost his medical license after numerous complaints.

He currently is serving a one-year jail term after pleading no contest in September to 11 felony counts of insurance fraud and exchanging drugs for sex.

The 14th Circuit Court jury sided with the plaintiff in the case, who alleges that Dallman engaged in escalating sexual abuse, including fondling and finally a rape that occurred in his office in 1995.

Criminal charges were never filed in the case. However, the plaintiff, whom The Chronicle is identifying only by her initials M.L. because of sexual abuse allegations, sued Dallman.

Dallman had admitted to committing medical malpractice by having M.L. sit on his lap and hugging her. He vehemently denied raping the woman, who has chronic mental illness, and that was not a question the jury had to answer.

After a day and a half of testimony, the jury found that Dallman had committed assault and battery on M.L., intentionally inflicted emotional distress on her and that his professional negligence had harmed her.

When the verdict was announced, courtroom observers said M.L. wept and said aloud "they believed me."

"When the verdict was finally read it was just a flood of emotions," said Matthew Halbower, M.L.'s attorney. "It was extremely healing for her and helpful to know that other people believed that it wasn't her fault because of this extreme sense of shame and guilt she has."

The damages are supposed to compensate the victim for her past and future suffering rather than punish Dallman. But his attorney, Vernon Kortering, said he believes the jury of three men and three women was punishing Dallman.

Kortering said he may seek a court order lowering the damage amount.

"(Dallman) doesn't feel it's fair," he said.

Kortering said his client was left with "nothing" after the divorce settlement, which was finalized Wednesday, the day after the M.L. case began. That leaves questions as to his ability to pay the damages.

He was fined $16,500 in his criminal case and $25,000 by the state when his license was revoked.

Dallman's ex-wife ended up with their home and Dallman's commercial property where he operated his office at 1259 Peck.

While Halbower is suspicious that the divorce was simply a way for Dallman to protect his assets, Kortering said Dallman was only trying to "protect his family" including the couple's three sons.

Nevertheless, Halbower said he is considering pursuing a "fraud against creditors" claim in relation to the divorce.

In addition, Dallman's malpractice insurance carrier successfully petitioned federal court to have his policy rescinded because he had lied about several past troubles with his medical license.

Halbower said he also will try to get reimbursement from the insurance company for his client, whom he called "the bravest woman I know."

The basis of M.L.'s case was a secret tape recording made by her aunt during a conversation the two women had with Dallman in his office.

The tape captured Dallman admitting to having sex with M.L. and threatening and coercing her to withdraw a complaint against him she had filed with the state. He also can be heard paying M.L. and her aunt each $100, which Halbower called a "bribe."

Dallman testified that when he said "I'm sorry for having sex with you" during that meeting, he was not referring to sexual intercourse.

Rather, Dallman said, he was referring to the fact that the woman had sat on his lap and that he had hugged her.

That tape recording was the basis for a decision earlier this year by the state's board of medicine to revoke Dallman's license for at least three years.

Halbower said it was difficult for M.L. to face Dallman after the rape in order to make the tape recording, but she was determined to "get the truth out."

"I firmly believe if it weren't for my client and that tape recorder, Dr. Dallman would still have a license to practice medicine and he'd still be hurting women," Halbower said. "I think my client is a heroine and has saved other potential victims."

Dallman's license had been sanctioned on three previous occasions, for such offenses as improperly distributing medications and kissing other patients.

Dallman also had previously been discharged from the U.S. Army after he was found guilty of illegally distributing drugs while working as an Army psychiatrist.

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