Axelsson v. Univ. of N. Dakota Sch. of Med. & Health Scis.
| Court | United States District Courts. 8th Circuit. United States District Court of North Dakota |
| Parties | Dr. Fiona Axelsson, Plaintiff, v. University of North Dakota School of Medicine and Health Sciences, Sanford, Sanford Health, and North Dakota Professional Health Program, Defendants. |
| Docket Number | 3:22-cv-00056 |
| Decision Date | 25 August 2022 |
Before the Court is Defendant North Dakota Professional Health Program's (“NDPHP”) motion to dismiss counts XXV (tortious interference with contract), XXVI (breach of contract), and XXVII (defamation) of Plaintiff Dr. Fiona Axelsson's amended complaint (Doc. No. 23) pursuant to Federal Rules of Civil Procedure 12(b)(1) and (6). Doc. Nos 27-29. Axelsson opposed the motions (Doc. No. 36), and NDPHP filed a reply. Doc. No. 37. For the reasons set forth below the motion is granted with respect to the breach of contract claim and denied as to the tortious interference with contract and defamation claims.
The factual background, which the Court must accept as true for the purposes of this motion, is taken from the amended complaint. See Doc. No. 23. In her amended complaint, Axelsson asserts various claims arising under Title VII of the Civil Rights Act of 1964, the Americans with Disability Act (the “ADA”), the North Dakota Human Rights Act (the “NDHRA”), and other federal employment and civil rights statutes, in addition to various state law claims. Id. ¶¶ 99-152. In general, these claims arise from the alleged sexual harassment of Axelsson by her program supervisor, alleged retaliatory and discriminatory conduct by Axelsson's former employers, Defendant University of North Dakota School of Medicine and Health Sciences (“UND”) and Defendant Sanford Health (“Sanford”), and, as relevant to this motion, NDPHP's actions and oversight of Axelsson pursuant to a monitoring agreement and her alleged noncompliance with the agreement. Id. ¶¶ 17, 58-62, 76, 87-88, 97-101. Axelsson alleges that the actions by the Defendants prevented her “from returning to work as a resident physician at UND/Sanford . . ..” Id. ¶ 102. She further alleges diversity jurisdiction based on her Canadian citizenship, the Defendants' North Dakota citizenship, and her position that her claims satisfy the $75,000 threshold necessary for diversity jurisdiction. Id. ¶¶ 6-7, 12.
Axelsson was a participant in the family medicine residency program sponsored by UND, and worked at a clinic in Fargo, North Dakota that was operated by Sanford. Id. ¶¶ 11, 13-14. Axelsson began participating in UND's residency program in 2019 pursuant to an employment contract. Id. ¶ 11. UND and Sanford have a contractual agreement, where the resident physicians work for Sanford. Id. ¶¶ 13-14.
During her residency, Axelsson struggled with mental health issues that she argues were the result of being sexually harassed by her residency program director. Id. ¶¶ 53-57. In April 2021, Axelsson sought, and took, an approved medical leave to address her mental health issues and to seek treatment for chemical health concerns. Id. ¶ 56. At the same time, Axelsson contacted NDPHP and enrolled in the physician health program for substance use and mental health disorders. Id. ¶¶ 59-62. As part of her participation in the program, Axelsson entered into a monitoring agreement with NDPHP and agreed to be tested for drugs and alcohol. Id. ¶ 60. Axelsson alleges she fully complied with the program's requirements and was cleared to return to work in the fall of 2021. Id. ¶ 62.
However, despite her alleged compliance, Axelsson further alleges that NDPHP refused to modify her return-to-work recommendations in a timely manner that would have allowed her to return to her prior employment. Id. ¶¶ 71, 74-75. Specifically, she states NDPHP refused to modify her return-to-work recommendations, despite her providers uniformly recommending the changes. Id. She further alleges that NDPHP filed multiple erroneous complaints about her use of alcohol with the state licensing board, despite having knowledge that the allegations in these complaints were untrue. Id. ¶ 76-77. Axelsson alleges NDPHP's actions gave Sanford and UND a pretextual reason to end her employment, despite the true motive being retaliation for reporting the sexual harassment she experienced. Id. ¶ 88.
NDPHP moves for dismissal of count XXV (tortious interference with contract), count XXVI (breach of contract), and count XXVII (defamation). As a threshold issue, NDPHP argues the Court lacks subject matter jurisdiction to entertain any of these claims due to the lack of diversity jurisdiction. Alternatively, NDPHP argues the three claims should be dismissed for failure to state a claim upon which relief can be granted. Axelsson argues that the requirements of diversity jurisdiction have been met and that each of the three claims contain sufficient factual allegations to defeat this motion to dismiss. For the most part, the Court agrees with Axelsson. However, on this amended complaint and only as to NDPHP, the Court cannot conclude that Axelsson has stated a plausible claim for breach of contract, and that claim is dismissed.
NDPHP moves for dismissal for lack of subject matter jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(1). The amended complaint invokes diversity jurisdiction as the basis for subject matter jurisdiction. In its jurisdictional challenge, NDPHP argues (1) NDPHP is statutorily immune from liability, and (2) the amount of damages in question is too speculative to meet the $75,000 amount in controversy requirement.
Federal courts must possess jurisdiction before reaching the merits of a case. Va. House of Delegates v. Bethune-Hill, 587 U.S.__, 139 S.Ct. 1945, 1950 (2019). “Federal court diversity jurisdiction of state law claims requires an amount in controversy greater than $75,000 and complete diversity of citizenship among the litigants.” Onepoint Solutions, LLC v. Borchert, 486 F.3d 342, 346 (8th Cir. 2007) (citing 28 U.S.C. § 1332(a)). “Whether a plaintiff satisfies the $75,000 amount in controversy requirement is a jurisdictional issue for the court to decide.” Krenz v. Xto Energy Inc., 770 F.Supp.2d 1011, 1014 (D. N.D. 2011) (). “Typically, complaints need only allege the jurisdictional amount in good faith and will be dismissed only if it ‘appear[s] to a legal certainty that the claim is really for less than the jurisdictional amount.'” Am. Family Mut. Ins. Co. v. Vein Ctrs. For Excellence, Inc., 912 F.3d 1076, 1080-81 (8th Cir. 2019).
As an initial matter, NDPHP does not challenge the diversity of citizenship between the parties and focuses instead on the amount in controversy.[1] NDPHP's first argument is that North Dakota Century Code section 43-17.3-08 provides blanket immunity, which means Axelsson cannot recover at least $75,000 against NDPHP. North Dakota Century Code section 43-17.308(1) states:
Notwithstanding any other provision of law, the board, the physician health program, committee or designated agency, or delegated individuals and members of any of these entities are not liable to any person for any acts, omissions, or recommendations made in good faith within the scope of responsibilities pursuant to this chapter.
(Emphasis added). The “primary objective in interpreting a statute is to ascertain the intent of the legislature by looking at the language of the statute itself and giving it its plain, ordinary, and commonly understood meaning.” Buchholz v. City of Oriska, 2000 ND 115, 611 N.W.2d 886, 887 (N.D. 2000) (citing N.D.C.C. §§ 1-02-02, 1-02-03). While there has not been any caselaw developed regarding this statute that is cited by either party, or that could be located by the Court, a plain reading supports the conclusion that any immunity for NDPHP's actions is contingent on those actions being taken in good faith. North Dakota law defines “good faith” as follows:
Good faith shall consist in an honest intention to abstain from taking any unconscientious advantage of another even through the forms or technicalities of law, together with an absence of all information or belief of facts which would render the transaction unconscientious.
N.D. Cent. Code § 1-01-21. “The determination whether a party acted in good faith under N.D.C.C. § 1-01-21 is a question of fact.” Farmers Union Oil Co. v. Smetana, 2009 ND 74, 764 N.W.2d 665, 670 (N.D. 2009).
In the amended complaint, Axelsson specifically alleges NDPHP's actions were not taken in good faith. Notably, she alleges that, despite her compliance with all requirements, NDPHP refused to modify her return-to-work recommendations in a timely manner that would have allowed her to return to her prior employment. Doc. No. 23 ¶¶ 71, 74, 75. Axelsson further alleges NDPHP refused to modify her return-to-work recommendations despite her providers uniformly recommending changes to the monitoring agreement. Id. And she alleges NDPHP reported multiple failed breathalyzer test results to the North Dakota Board of Medicine, even though it was aware that she was not using alcohol. Id. ¶ 76. On these specific allegations, including the allegations that NDPHP did not act in good faith, North Dakota Century Code section 43-17.308(1) does not provide blanket immunity to NDPHP.
With the statutory immunity question resolved, the next question is whether the $75,000 amount in controversy requirement is met. As noted by NDPHP, under North Dakota law, the measure of damages for tortious interference with contract “is the amount which will compensate for all the detriment proximately caused thereby, whether it could have been...
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