Campbell v. St. Mary's Hospital

Decision Date25 March 1977
Docket NumberNo. 46742,46742
Citation312 Minn. 379,252 N.W.2d 581
PartiesCraig CAMPBELL, M. D., Appellant, v. ST. MARY'S HOSPITAL, et al., Respondents, Duluth Surgical Board of Recommendations, et al., Respondents, Duluth Clinic, Ltd., Respondent.
CourtMinnesota Supreme Court

Syllabus by the Court

1. Summary judgment for defendant hospital in plaintiff's action on the ground of breach of contract following termination of his medical staff privileges as a surgeon was proper where the record submitted concerning notice and investigative and hearing procedures shows no genuine issue as to any material fact and establishes that plaintiff was afforded fundamental fairness as to all his contractual rights granted him under the bylaws, rules, and regulations of defendant hospital governing the granting and revocation of medical staff privileges.

2. Summary judgment was also proper concerning plaintiff's alleged additional claims of interference with business relationships, defamation, and conspiracy against individual members of review boards where his broad allegations of malice, a required prerequisite of any such action against medical review organizations, their members, or employees under Minn.St. 145.63, are unsupported by any showing of a genuine issue as to any material facts.

Holmes, Eustis, Kircher & Graven, and Warren P. Eustis, Minneapolis, for appellant.

Johnson, Fredin, Killen, Thibodeau & Seiler, John J. Killen, Jr., and Steven C. Fecker, Duluth, for St. Mary's Hospital.

Halverson, Watters, Bye & Downs, Gene W. Halverson, Michael Q. Lynch, C. M. Fredin for respondents Duluth Surgical Board of Recommendations.

Donovan, McCarthy, Crassweller, Larson, Barnes & Magie and Charles T. Barnes, Duluth, for Duluth Clinic.

Considered and decided by the court en banc.

ROGOSHESKE, Justice.

Following termination of his medical staff privileges as a surgeon by defendant St. Mary's Hospital in October 1975, plaintiff, Dr. Craig Campbell, brought this action seeking injunctive, declaratory, and monetary relief arising from allegations of denial of due process, breach of contract, interference with business relationships, defamation, and conspiracy. 1 Upon motions for summary judgment made both by defendants and plaintiff, the trial court ruled in favor of defendants, finding that plaintiff's surgical privileges were terminated with proper regard to his due process rights under both the Federal and state constitutions. While we find no showing of state action on the part of any named defendant to raise plaintiff's due process claims to a constitutional dimension, we nevertheless hold that plaintiff was afforded fundamental fairness as to all of what may be termed his contractual due process rights under the bylaws, rules, and regulations governing medical staff privileges granted by St. Mary's Hospital. Finding no genuine issue as to any material fact to support plaintiff's other alleged claims, we affirm the trial court's award of summary judgment to defendants.

For approximately 3 years prior to this action, plaintiff practiced surgery in Duluth as a board-certified surgeon licensed to practice in Minnesota. During the early part of 1975, plaintiff was an employee of the Duluth Clinic and was also an active member of the surgical staff at St. Mary's Hospital. As a condition precedent to his hospital appointment, plaintiff agreed to abide by the bylaws, rules, and regulations governing the medical staff of the hospital, pertinent parts of which are printed in the appendix. The Duluth Surgical Board of Recommendations is a local review organization comprised solely of surgeons that has since 1935 served St. Mary's and the two other Duluth hospitals in an advisory capacity with regard to the granting of surgical privileges.

In April 1875, a surgeon on the staff of the Duluth Clinic asked to meet with the Duluth Surgical Board of Recommendations to discuss problems which had arisen in connection with plaintiff's surgical practice. After a meeting with this surgeon, the board advised all Duluth hospitals that plaintiff should be allowed to perform major surgery only under the observation of another surgeon as sponsor. This recommendation by the board prompted the administrator of St. Mary's to notify plaintiff on April 25 that he would be required to have sponsors for all major surgery. Although plaintiff was entitled under the board's operational principles to appeal the sponsorship recommendation, he elected not to do so.

This sponsorship program continued until July 14, 1975, when the Duluth Clinic, which had previously provided sponsors for plaintiff, terminated his employment. 2 Alerted by these developments, the administrator of St. Mary's requested the chief of staff on July 22 to implement Art. IV of the hospital's bylaws providing for an investigation into the performance of a member of the medical staff. On July 25, a special investigating committee was appointed pursuant to Art. IV. § 1(b), and on that same date plaintiff was notified that his surgical practice was under investigation which could ultimately result in a reduction or suspension of his staff privileges. The committee then reviewed each chart of every patient treated by plaintiff at St. Mary's, and was able to document 231 separate medical deficiencies in 86 patient histories. On August 6, plaintiff was given an opportunity to meet with the committee and, assisted by counsel, to respond to the criticized cases. The following day, the committee made a report to the executive committee of the medical staff, as required by the bylaws, and unanimously recommended that plaintiff's surgical privileges be terminated.

Plaintiff was thereafter promptly advised by letter that the investigating committee's recommendation had been adverse, and that under Art. V of the bylaws he was entitled upon request to a formal hearing before a special ad hoc committee of the executive committee. After a timely request was made by plaintiff's attorney, a hearing was scheduled for August 21. Prior to the hearing, which was continued to September 3 at plaintiff's request, he was given a copy of the written findings of the investigating committee and was also afforded the opportunity of reviewing the 86 criticized cases. He was not, however, given access to the reports made by his sponsors because these reports covered operations performed not only at St. Mary's but also at the other two hospitals in Duluth. 3

While these proceedings were in progress at the hospital, the Duluth Surgical Board of Recommendations met to reconsider plaintiff's status. Following a recommendation by this board on August 15 that plaintiff's surgical privileges be totally revoked, the administrator of St. Mary's exercised her authority under Art. IV, § 2, of the bylaws and summarily suspended plaintiff's privileges. Plaintiff again chose not to appeal the adverse recommendation of the Duluth Surgical Board of Recommendations as he was entitled to do under that body's operational principles. He did appeal his summary suspension by the administrator, which was consolidated with the hearing before the ad hoc committee.

On September 3, the continued ad hoc committee hearing was reconvened, and plaintiff was given a full opportunity, aided by an attorney, to present his case. After thorough consideration of the evidence, including expert testimony from Dr. William Holden, who testified on behalf of plaintiff, the ad hoc committee recommended to the chief of staff that plaintiff not have major surgical privileges at St. Mary's. This proposed restriction was then reviewed by the full executive committee, as provided by Art. V, § 2(c), and on September 12, this body submitted its recommendation to the board of trustees of St. Mary's Hospital that all of of plaintiff's surgical privileges by rescinded.

In strict compliance with Art. V, § 3, of the bylaws, plaintiff was advised in writing of the executive committee's adverse recommendation and of his right to request a formal review hearing before the medical staff committee of the board of trustees. Plaintiff requested and was given such a hearing on October 6, following which the medical staff committee recommended to the board of trustees that plaintiff's surgical staff privileges at St. Mary's be terminated. This recommendation was endorsed by the board of trustees at its regular meeting on October 21, and plaintiff's final termination became effective October 23.

In considering the cross-motions for summary judgment made by both plaintiff and defendants, the trial court operated from the premise that "(t)he gravamen of plaintiff's case concerns his allegation that he was denied due process of law in the rescission of his surgical privileges." If plaintiff was afforded due process, the court reasoned, his remaining claims for breach of contract, interference with business relationships, defamation, and conspiracy would necessarily become moot. The court went on to presume, without elaboration, that state action existed to bring the due process requirements of both the Federal and state constitutions into play and ultimately concluded that defendants were entitled to summary judgment since plaintiff had been afforded due process throughout the proceedings to revoke his surgical privileges.

The threshold question which we must resolve on this appeal is whether the trial court correctly found the existence of state action on the part of defendants, particularly St. Mary's Hospital. It is of course elementary that the due process provisions of the Fourteenth Amendment and Minn.Const. art. 1, § 7, apply only if the actions to terminate plaintiff's surgical privileges were done under color of state law. As most recently explained by the United States Supreme Court in Jackson v. Metropolitan Edison Co., 419 U.S. 345, 349, 95 S.Ct. 449, 453, 42 L.Ed.2d 477, 483 (1974):

"The Due Process Clause of the ...

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