Everett v. St. Ansgar Hosp.

Decision Date01 September 1992
Docket NumberNo. 91-3639,91-3639
Citation974 F.2d 77
PartiesS. Fred EVERETT, M.D., Appellant, v. ST. ANSGAR HOSPITAL, a Minnesota non-profit corporation; Franciscan Sisters Healthcare, Inc., a Minnesota non-profit corporation; The Franciscan Sisters of Little Falls, Minnesota, a Minnesota non-profit corporation, Appellees.
CourtU.S. Court of Appeals — Eighth Circuit

James M. Williams, Minneapolis, Minn., argued, for appellant.

Bernard E. Reynolds, Moorhead, Minn., argued (John R. Kenefick, St. Paul, Minn., Randolph E. Stefanson and Daniel D. Plambeck, Moorhead, Minn., for Franciscan Sisters Health Care and Franciscan Sisters of Little Falls, Minn.; Dean A. Hoistad, Moorhead, Minn., for St. Ansgar Hosp., on brief), for appellees.

Before BOWMAN, LOKEN, Circuit Judges, and HUNTER, * Senior District Judge.

BOWMAN, Circuit Judge.

This is a diversity case. The plaintiff, S. Fred Everett, asserts various state law claims. He appeals from the orders of the District Court 1 granting summary judgment to all defendants. We affirm.

Everett has been a practicing physician in the Fargo, North Dakota--Moorhead, Minnesota area since 1965. From 1981 until July 18, 1988, he had medical staff and clinical privileges at St. John's Hospital in Fargo. 2 On July 18, 1988 he was summarily suspended from his hospital privileges pursuant to the hospital's by-laws. Thereafter, the hospital's chief administrator instituted a complaint against Everett pursuant to the by-laws, which resulted in Everett's hospital privileges being revoked on April 6, 1989.

Everett filed this action in the District of Minnesota on August 19, 1988, alleging that his summary suspension amounted to a breach of contract by appellee Franciscan Sisters Healthcare, Inc. ("FSH"). He moved for a temporary restraining order and a preliminary injunction enjoining FSH from enforcing the summary suspension. The federal district court in Minnesota denied Everett's motions and granted FSH's motion for dismissal for failure to join the indispensable proper defendant, St. Ansgar Hospital (doing business as St. John's Hospital, see n. 2, supra ).

In October 1989, we affirmed the dismissal of FSH for failure to sue the indispensable proper defendant, but remanded the case "for the purpose of permitting amendment of the complaint by adding the proper party as defendant." Everett v. Franciscan Sisters Healthcare, Inc., 882 F.2d 1383, 1389 (8th Cir.1989). On remand, Everett amended his complaint to include St. Ansgar Hospital, its corporate parent FSH, and The Franciscan Sisters of Little Falls ("Little Sisters"), FSH's corporate parent, as parties. He also amended his complaint to allege not only breach of contract for the summary suspension, but also breach of contract for the revocation of his hospital privileges, and tort claims for bad faith termination of contract and wrongful interference with contract. The federal district court in Minnesota thereafter granted the defendants' motion for change of venue, transferring the case to the District of North Dakota.

In November 1990, the federal district court in North Dakota ("the District Court") granted the motions of FSH and Little Sisters for summary judgment, stating that the res judicata effect of our 1989 decision barred Everett from pursuing his claims against either of these two parties. In October 1991, the court granted St. Ansgar Hospital's motion for summary judgment, holding that there was no dispute as to whether Everett received his contractual due process rights and that there was no evidence of bad faith or malice on the part of St. Ansgar's. On appeal, Everett challenges the change of venue and the granting of summary judgment to all three defendants.

"The grant or denial of a change of venue is in the discretion of the trial court and may not be set aside absent a clear showing of abuse of discretion." Hubbard v. White, 755 F.2d 692, 694 (8th Cir.), cert. denied, 474 U.S. 834, 106 S.Ct. 107, 88 L.Ed.2d 87 (1985). Everett falls far short of such a showing; thus, we refuse to reverse the change of venue.

We turn next to the District Court's order granting FSH's and Little Sisters' motions for summary judgment. When we first addressed this case, we had before us an appeal from the dismissal of FSH. We explicitly affirmed that dismissal, holding "judgment of dismissal as to appellee [FSH] must be affirmed," Everett, 882 F.2d at 1387, and "the District Court's dismissal of Dr. Everett's pending action against appellee [FSH] must therefore be affirmed," id. at 1389. We held that dismissal as to FSH was appropriate because "[n]o agency, alter ego, or piercing [of] the corporate veil[ ] affords occasion in the case at bar to depart from the settled rule of respecting the separate corporate identities of the entities involved." Id. at 1388 n. 13. Although our holding was limited to FSH, it applies equally to Little Sisters. Since St. Ansgar (doing business as St. John's) was not acting as the alter ego of its corporate parent (FSH), it follows, in the absence of any evidence presented by Everett to the contrary, that it also was not acting as the alter ego of its "grandparent" (Little Sisters, which is FSH's corporate parent). The District Court properly granted summary judgment to FSH and Little Sisters. 3

Finally, we turn to Everett's claims against St. Ansgar. He alleges that his summary suspension and subsequent revocation of his hospital privileges amounted to a breach of contract, tortious interference with contract, and tortious termination of contract. Although neither party deemed it necessary to address the choice of law issue, we assume that in this diversity case the law of North Dakota is the applicable law, as the District Court cited North Dakota law in its order granting summary judgment and both parties make occasional reference to North Dakota law.

In North Dakota, an at-will employment state, "an employer may agree to restrict or limit his right to discharge an employee" contractually. Hillesland v. Federal Land Bank Ass'n, 407 N.W.2d 206, 214 (N.D.1987). In such a case, the employer legally can discharge an employee "only in accordance with the contractual terms." Lambott v. United Tribes Educ. Technical Ctr., 361 N.W.2d 590, 593 (N.D.1985). Since Everett agreed in his application for hospital privileges to be bound by the hospital's by-laws, we must examine those by-laws in order to determine if there is a factual dispute on the breach-of-contract issue, a chore made difficult and unnecessarily time-consuming by the fact that neither party saw fit to include the by-laws in any filing with this court. 4

A review of the by-laws convinces us that nothing in Everett's allegations amount to a violation of the procedures to which he was entitled. Even if there was such a violation, however, Everett...

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