Utah Hospital Lawsuit: Why the $951M Award May Not Be Paid

In August 2025, a Utah judge ordered Steward Health Care to pay $951 million to the family of a child left permanently brain-damaged after a catastrophic 2019 delivery at Jordan Valley Medical Center in West Valley City. The Utah hospital malpractice lawsuit produced the largest medical malpractice award in state history and one of the largest birth injury verdicts ever recorded in the United States. Whether the family will collect any meaningful portion of it is a separate question, and the answer so far is not encouraging: Steward filed for bankruptcy in 2024, its in-house malpractice insurer is nearly empty, and Utah law caps a large slice of the award at a fraction of what the judge ordered.¹

What Happened During the Delivery

Anyssa Zancanella was admitted to Jordan Valley Medical Center on October 12, 2019. According to the court’s findings, the nurses assigned to her had finished their training that same day. They administered dangerously high doses of Pitocin, a labor-inducing drug, for hours despite clear signs of fetal distress, including the baby’s rising blood pressure and the mother’s fever.² The on-call physician, alerted to those warning signs, went back to sleep in a room steps away from the labor.¹

A cesarean section was not performed until more than 24 hours after admission. By the time Azaylee was delivered, she had a misshapen head, severe swelling, and injuries consistent with prolonged oxygen deprivation.³ Airlifted to Primary Children’s Hospital, she was diagnosed with metabolic acidosis, which can indicate asphyxia before or during birth, and hypoxic ischemic encephalopathy, a brain injury caused by oxygen deprivation.¹

The Child’s Condition Today

Azaylee McMicheal turned six in October 2025. She is nonverbal, developmentally delayed by roughly three years, and requires round-the-clock care. She suffers from seizures, though medication has kept the most severe episodes at bay. She has permanent facial scars from the delivery and struggles with decision-making and mood regulation.⁴ She receives physical and occupational therapy and attends kindergarten part-time.⁵ The family shares a single bedroom because Azaylee cannot sleep alone, and her parents have installed high locks on all the doors in their home.⁶

How the $951 Million Judgment Was Entered

Zancanella and Azaylee’s father, Danniel McMicheal, sued Steward Health Care, which owned Jordan Valley Medical Center at the time. Steward initially denied the allegations in May 2024, then withdrew its legal counsel and stopped participating in the case.¹ On August 8, 2025, Third District Court Judge Patrick Corum entered a default judgment for $951,849,363.02.⁷

The award breaks down into three pieces:

$475 million in punitive damages, aimed at what the judge described as gross negligence and reckless conduct.
$410 million in non-economic damages: $200 million to Azaylee for pain and suffering, $110 million to her mother, and $100 million to her father.
More than $65 million in economic damages for projected lifetime medical and care costs.⁷

Judge Corum called Jordan Valley Medical Center “the most dangerous place on the planet” for Zancanella to have given birth, comparing the conditions unfavorably to delivering in a gas station bathroom.³ He said of Azaylee: “The person she was to be, the person she deserved to be, is trapped inside a brain-damaged child. I cannot think of anything more profound, total or complete than that loss.”⁵ He noted the award could have been higher had Steward not abandoned the case.¹

Why the Family May Not Receive $951 Million

Utah law caps non-economic damages in medical malpractice cases at $450,000 per plaintiff.⁸ If the cap is applied, the $410 million in non-economic damages could be reduced to as little as $450,000 in total. The family’s attorneys have argued the cap should not apply given the default judgment and that enforcing it would erase most of the judge’s verdict.⁷ A 2025 legislative effort to raise the cap to $950,000, Utah House Bill 288, died in March 2025 without passing.⁹

The economic damages of more than $65 million are not subject to the cap. And under Utah law, half of any punitive damages are diverted to the state, which would cut the family’s share of the $475 million punitive award to roughly $237.5 million before any other reductions.⁷

The Bigger Problem: Collecting Anything at All

Even before the cap question is resolved, the more immediate obstacle is that Steward Health Care filed for Chapter 11 bankruptcy in May 2024 in the U.S. Bankruptcy Court for the Southern District of Texas, reporting billions in outstanding debts.¹ The company had 90 days from the August 8, 2025, ruling to appeal, and available reporting does not confirm whether an appeal was filed.

Zancanella told reporters after the verdict that the case had become “a new battle” because “the hospital doesn’t have to pay, and they can make this go on.”⁴

Steward’s in-house malpractice insurer, Tailored Risk Assurance Co. (TRACO), compounds the problem. A Boston Globe investigation found that by August 2024, TRACO held just $3.5 million in cash despite carrying 517 outstanding malpractice claims that Steward’s own lawyers estimated could cost up to $200 million to resolve. Steward executives had repeatedly moved money out of TRACO and into the hospital chain, leaving the insurer’s books loaded with IOUs from the now-bankrupt parent company.¹⁰ Malpractice victims across Steward’s former hospital network, including cases involving amputations and deaths, have gone unpaid, and courts have begun holding individual doctors personally liable for settlements TRACO failed to fund.¹¹

Where Money Might Still Come From

One potential source is the SHC Creditor Litigation Trust, created during the bankruptcy to pursue claims on behalf of creditors, including former employees, patients, and vendors. In November 2025, the trust filed a $3.4 billion clawback lawsuit against former CEO Ralph de la Torre and other executives, alleging years of self-dealing transactions that stripped the system of its assets.¹² That litigation remained in discovery as of mid-2026. If the trust recovers meaningful funds, patients with malpractice claims, including the Zancanella family, could receive some portion of what they are owed. The path to any payment is long.

Jordan Valley Medical Center itself is no longer owned by Steward. CommonSpirit Health acquired the facility along with four other Utah hospitals in 2023, and it now operates as CommonSpirit Holy Cross Hospital – West Valley.¹³ The change of ownership does not transfer liability for the 2019 delivery to CommonSpirit; the judgment sits against Steward, and Steward’s ability to pay is what controls whether the family sees any of the $951 million.

1
Becker’s Hospital Review. Steward Ordered to Pay Nearly $1B in Utah Malpractice Case
2
New York Post. Judge Awards Family Nearly $1B for Botched Delivery of Baby at Utah Hospital
3
ASRN. $951M Birth Injury Verdict: Nurses in Training, Sleeping Doctor Blamed
4
Cowboy State Daily. Judge Awards Nearly $1 Billion to Rock Springs Family Over Botched Baby Delivery
5
Nurse.org. Utah Birth Injury Verdict $951M
6
International Business Times. Utah Family Wins Nearly $1B After Girl Left Disabled by Hellish Hospital Delivery
7
Clinician. Blockbuster Birth Injury Verdict Holds Lessons
8
Utah Courts. Damage Cap
9
BillTrack50. UT HB0288
10
Boston Globe. Steward TRACO Malpractice Insurance
11
Massachusetts Lawyers Weekly. Steward TRACO Malpractice Insurance Settlement Crisis
12
D Magazine. Steward Health Care Trustee Files $3.4 Billion Lawsuit Against Former CEO
13
CommonSpirit Health. CommonSpirit Holy Cross Hospital Jordan Valley West Receives New Hospital Name