Bhan v. NME Hospitals, Inc.

• Decision Date: 16 September 1987
• Docket Number: No. CIV S-83-295 LKK.,CIV S-83-295 LKK.
• Citation: 669 F. Supp. 998
• Court: U.S. District Court — Eastern District of California
• Parties: Vinod C. BHAN, C.R.N.A., Plaintiff, v. NME HOSPITALS, INC., a Delaware corporation d/b/a Manteca Hospital, National Medical Enterprises, Inc., and John E. Menaugh, Defendants.

669 F. Supp. 998

Vinod C. BHAN, C.R.N.A., Plaintiff, v. NME HOSPITALS, INC., a Delaware corporation d/b/a Manteca Hospital, National Medical Enterprises, Inc., and John E. Menaugh, Defendants.

No. CIV S-83-295 LKK.

United States District Court, E.D. California.

September 16, 1987.

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Timothy E. Morgan, McDermott & Trayner, Pasadena, Cal., H.E. Christian Peeples, Oakland, Cal., Michael I. Spiegel, Spiegel, Cutler, Liao & Kagay, San Francisco, Cal., for plaintiff.

Michael C. Normoyle, Teresa Vig Rein, Damrell, Damrell & Nelson, Modesto, Cal., Robert Fabrikant, McKenna, Conner & Cuneo, Washington, D.C., for defendants.

KARLTON, Chief Judge.

Plaintiff Vinod C. Bhan ("Bhan") is a certified registered nurse anesthetist ("CRNA") who, in 1983, lost his job at Manteca Hospital after the Hospital decided to implement a policy which permitted only M.D. anesthesiologists to administer anesthesia at the Hospital. He has sued NME Hospitals, Inc., National Medical Enterprises, Inc., John E. Menaugh ("Menaugh"), California Society of Anesthesiologists ("CSA"), California League of Anesthesiologists ("CLA"), and Dr. Young Suk.¹

Bhan alleges that the decision of the Hospital to permit only M.D. anesthesiologists to administer anesthesia to patients violated sections 1 and 2 of the Sherman Act, 15 U.S.C. §§ 1, 2 (1985). The complaint also alleges a number of pendent state claims. Plaintiff seeks injunctive relief, damages, treble damages, punitive damages, and attorney's fees and costs.

I PROCEDURAL BACKGROUND

Bhan filed his complaint on March 28, 1983, together with an application for Temporary Restraining Order ("TRO"). The proposed TRO sought to compel the Hospital to permit Bhan to perform anesthesia at the Hospital. On April 11, 1983, I denied the application for a TRO because Bhan had failed to satisfy the stringent standards for obtaining mandatory relief.

Defendants CSA and CLA brought a motion to dismiss for failure to state a claim. They argued that plaintiff did not have standing to sue under the federal antitrust laws. I granted the motion because in my view, under California law, nurse anesthetists may not, and thus do not, compete with M.D. anesthesiologists in the same market. Accordingly, I held that the decision by the Hospital to exclude nurse anesthetists did not undermine competition, and thus could not implicate the antitrust laws. I concluded that any injury suffered by Bhan was not the type of injury cognizable under the Sherman Act. The Ninth Circuit reversed in Bhan v. NME Hospitals, Inc., 772 F.2d 1467 (9th Cir.1985), holding that since Bhan could provide anesthesia under a physician's control and direction, it could not be said that, as a matter of law, Bhan was unable to compete with M.D. anesthesiologists.²

Defendants NME Hospitals, Inc., National Medical Enterprises, Inc., and John E. Menaugh have now moved for summary judgment on all of plaintiff's claims. After hearing, the motion was taken under submission. By this order, I grant defendants' motion as to the Sherman Act claims, and dismiss the pendent claims.

II STANDARDS FOR SUMMARY JUDGMENT

In 1986, the Supreme Court addressed the standards for summary judgment in three separate cases: Matsushita Electric Industrial Co. v. Zenith Radio Corp, 475 U.S. 574, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986); Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); and Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Although the Court repeatedly denied that it was altering those standards, I know of no district judge who does not believe that in some fashion his or her duty in reviewing such motions has been altered. Below, I articulate my best understanding of the appropriate method of approaching motions for summary judgment. I also note that summary judgment in the antitrust area has taken on a new complexion.

As the federal rules provide, summary judgment is appropriate when there exists "no genuine issue as to any material fact and ... the moving party is entitled to judgment as a matter of law." Fed.R. Civ.P. 56(c); Jung v. FMC Corp., 755 F.2d 708, 710 (9th Cir.1985). The moving party bears the initial burden of establishing, through affidavits or otherwise, the absence of a genuine issue as to any material fact. Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 1608, 26 L.Ed.2d 142 (1970); see T.W. Elec. Service, Inc. v. Pacific Elec. Contractors Ass'n, 809 F.2d 626, 630 (9th Cir.1987). The moving party does not necessarily have to put on evidence which negates the opponent's claim. Celotex, 106 S.Ct. at 2553. Rather, the moving party may prevail by simply pointing out "those portions of `the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any,' which it believes demonstrate the absence of a genuine issue of material fact." Id. at 2553.

When the moving party has identified portions of the record which demonstrate the absence of a genuine issue of material fact, and the opposing party will have the burden of proof as to that fact at trial, the opposing party has an obligation to produce evidence showing that the fact is in dispute. Celotex, 106 S.Ct. at 2552-53. If the opposing party fails to make the requisite showing, the court must enter judgment in favor of the moving party. Id.

In such a situation, there can be "no genuine issue as to any material fact," since a complete failure of proof concerning an essential element of the nonmoving party's case necessarily renders all other facts immaterial. The moving party is "entitled to judgment as a matter of law" because the nonmoving party has failed to make a sufficient showing on an essential element of her case with respect to which she has the burden of proof.

Celotex, 106 S.Ct. at 2553.

In attempting to establish the existence of this factual dispute, the opposing party may not rely upon the denials of its pleadings, but is required to tender evidence of specific facts in the form of affidavits or admissible discovery material which support its contention that the dispute exists. See Fed.R.Civ.P. 56(e); Strong v. France, 474 F.2d 747, 749 (9th Cir.1973).

In resolving the summary judgment motion, the court examines "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any." Fed.R.Civ.P. 56(c). Of course, it is the obligation of the parties to direct the court to the place in the record where evidence of the facts might be found. All reasonable inferences which may be drawn from the facts before the court must be drawn in favor of the party opposing the motion, in this case plaintiff. See Matsushita, 106 S.Ct. at 1356-57. Nevertheless, inferences are not drawn from the air, and it is the opposing party's obligation to produce a factual predicate from which the inference may be drawn. Richards v. Nielsen Freight Lines, 602 F.Supp. 1224, 1244 (E.D.Cal.1985), aff'd, 810 F.2d 898 (9th Cir.1987).

I have previously noted a rhetorical reluctance to grant summary judgment in antitrust cases, which I suggested made no difference in the way courts actually resolved such motions. See Grason Elec. Co. v. Sacramento Mun. Util. Dist., 571 F.Supp. 1504, 1507 (E.D.Cal.1983). It is my view that the Supreme Court has completely shifted the premise, and now seeks to encourage the summary disposition of antitrust litigation. Traditionally it has been said that the opposing party must demonstrate that the disputed fact is material, i.e., that it makes a difference in the litigation, and that the dispute is genuine. T.W. Elec. Service, 809 F.2d at 630. The opposing party need not establish the material issue of fact conclusively in its favor. Id. It is sufficient that "the claimed factual dispute be shown to require a jury or judge to resolve the parties' differing versions of the truth at trial." First Nat'l Bank v. Cities Service Co., 391 U.S. 253, 289, 88 S.Ct. 1575, 1592, 20 L.Ed.2d 569 (1968).

In Matsushita, however, the Court explained with respect to a section 1 claim that:

To survive the motion for summary judgment, plaintiffs must establish that there is a genuine issue of material fact as to whether defendants entered into an illegal conspiracy that caused plaintiffs to suffer a cognizable injury.... This showing has two components. First, plaintiffs must show more than a conspiracy in violation of the antitrust laws; they must show an injury to them resulting from the illegal conduct....

Second, the issue must be "genuine." ... When the moving party has carried its burden under Rule 56(c), its opponent must do more than simply show that there is some metaphysical doubt as to the material facts.

Matsushita, 106 S.Ct. at 1355-56 (footnotes and citations omitted). The Court also said that "if the claim is one that simply makes no economic sense, plaintiffs must come forward with more persuasive evidence to support their claim than would otherwise be necessary." Id. at 1356.

The Court has also altered the method of handling inferences concerning the existence of a conspiracy. The Court now teaches, at least with respect to parallel conduct cases, that:

conduct as consistent with permissible competition as with illegal conspiracy does not, standing alone, support an inference of antitrust conspiracy.... To survive a motion for summary judgment or for a directed verdict, a plaintiff seeking damages for a violation of § 1 must present evidence "that tends to exclude the possibility" that the alleged conspirators acted independently.... Plaintiffs in this case, in other words, must show that the inference of conspiracy is reasonable in light of the competing inferences of independent action or collusive action that could not have harmed plaintiffs.

Id. at 1357 (citations omitted).³

III UNDISPUTED...