Such cases can depend on whether a judge or jury determines that the illegal actions were done within the "scope of employment" and that the employer should be held liable for an employee's actions, Slutkin said.

"Even if an act is willful, reckless or criminal, so long as a person acts within the scope of their employer or in furtherance of business, the employer is liable," Slutkin said.

The legal concept, which dates to the Middle Ages and the days of servants acting on behalf of their masters, requires consideration of how the illegal actions relate to an employee's normal duties, Dolin said.

St. Francis Hospital in Hartford, Conn., settled with about 150 patients last year for about $50 million after one victim was awarded $2.75 million in a 2011 trial. The case revealed that endocrinologist George Reardon had launched what he called a long-term pediatric growth study as a pretext for photographing children posed obscenely, sometimes in groups.

Hartford attorney Richard Kenny, who represented 43 of the victims, said while they found no evidence that hospital officials knew of Reardon's activities, documents showed that those officials were required to police and review research activity. Lawyers argued in court that the hospital failed to follow its own internal rules and regulations, Kenny said.

"You need to be able to present a claim of negligence against the institution," Kenny said. "That's the only way to get insurance to trigger."

Baltimore Sun reporter Jessica Anderson contributed to this article.

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