Cmty. Health Sys. Prof'l Servs. Corp. v. Hansen

• Decision Date: 16 June 2017
• Docket Number: No. 14-1033.,14-1033.
• Citation: 525 S.W.3d 671
• Parties: COMMUNITY HEALTH SYSTEMS PROFESSIONAL SERVICES CORPORATION, et al., Petitioners, v. Henry Andrew HANSEN, II, M.D., Respondent
• Court: Texas Supreme Court

525 S.W.3d 671

COMMUNITY HEALTH SYSTEMS PROFESSIONAL SERVICES CORPORATION, et al., Petitioners,

v.Henry Andrew HANSEN, II, M.D., Respondent

No. 14-1033.

Supreme Court of Texas.

Argued March 2, 2017

OPINION DELIVERED: June 16, 2017

Rehearing Overruled September 22, 2017

James Foley, Richard Daniel Weaver II, The Weaver Law Firm, Houston, for Amicus Curiae Foley, M.D., Neal T.

Barry Oswalt M.D., Southlake, for Amicus Curiae Oswalt, M.D., Barry.

J. David Breemer, Pacific Legal Foundation, Sacremento CA, for Amicus Curiae Pacific Legal Foundation.

Amanda Martin, Texas Association of Business, Austin, E. Lee Parsley, Attorney at Law, Austin, for Amicus Curiae Texans for Lawsuit Reform.

Charles W. Bailey, Texas Hospital Association, Austin, for Amicus Curiae Texas Hospital Association.

Donald P. Wilcox, Jared S. Livingston, Kelly M. Walla, Texas Medical Association, Austin, for Amicus Curiae Texas Medical Association.

Eric White, Office of the Attorney General, Austin, for Amicus Curiae The State of Texas.

Danica Lynn Milios, Kent C. Sullivan, Peter Carl Hansen, Sean D. Jordan, William Powers Jr., Jackson Walker LLP, Austin, Christopher D. Knudsen, John S. Serpe, Serpe, Jones, Andrews Callender & Bell, PLLC, Houston, for Petitioners.

Broadus A. Spivey, Law Offices of Broadus A. Spivey, Austin, Bill Youngkin, Matthew D. Doss, Youngkin & Doss, P.L.L.C., Bryan, Nanneska N. Hazel, George Brothers Kincaid & Horton LLP, Austin, Robert L. Duncan, Crenshaw Dupree & Milam, L.L.P., Lubbock, for Respondent.

Justice Green delivered the opinion of the Court.

In this case, we must determine whether the court of appeals erred by reversing the trial court's order granting summary judgment in favor of multiple defendants on the plaintiff's claims for breach of contract and tortious interference with contract. Because we conclude that the plaintiff's employer was not required to prove the reasons it terminated the plaintiff's employment contract "without cause" and that the relevant provisions of the contract are not ambiguous, we hold that the employer is entitled to summary judgment on the plaintiff's breach of contract claim. We further hold that the hospital and its chief executive officer are entitled to summary judgment on the plaintiff's tortious interference claim because the plaintiff presented no evidence on the element of willful or intentional inference. Finally, we hold that the employer's professional services company conclusively established its justification defense to the plaintiff's tortious interference claim and is therefore entitled to summary judgment. Accordingly, we reverse the court of appeals' judgment and reinstate the trial court's judgment in favor of the defendants.

I. Background

This action arises from the "without cause" termination of a cardiovascular surgeon's five-year employment contract at the end of his third contract year.

In 2007, Thomas Jackson, the chief executive officer of the College Station Medical Center (the Hospital), sought to hire a board-certified cardiovascular surgeon so that the Hospital could offer heart surgeries without referring patients to other hospitals or paying to have a cardiovascular surgeon on call. Dr. Henry Andrew Hansen, II, M.D., a cardiovascular surgeon, wanted to move his practice from Lubbock to College Station, Texas, and he arranged a meeting with Jackson to discuss potential employment in College Station.

Acting as an intermediary between Dr. Hansen and Regional Employee Assistance Program (REAP), a non-profit corporation certified by the Texas Medical Board to employ physicians, see TEX. OCC. CODE § 162.001(b), Jackson negotiated the terms of Dr. Hansen's employment contract with REAP, under which Dr. Hansen would work at the Hospital.¹ After extensive negotiations in which Dr. Hansen was represented by counsel, REAP and Dr. Hansen entered into a five-year employment contract, which ran from June 1, 2007, to April 30, 2012. Section 10.1 of the contract provided that during the first three contract years, the contract could be terminated only for cause. Following the end of the third contract year, however, either party could terminate the contract without cause with sixty days' notice if Dr. Hansen's "annual practice losses" exceeded $500,000 "at the end of years three, four or five." The contract further provided that in the event of a termination without cause, Dr. Hansen would "not be entitled to the due process rights established by [REAP] in its policies and procedures," but Dr. Hansen would "be entitled to such due process rights if ... terminated for cause ... pursuant to sections 10.2, 10.3 or 10.4 of [the contract]."

A month into Dr. Hansen's employment, Community Health Systems, Inc. acquired the Hospital and REAP. Community Health Systems Professional Services Corporation (PSC) is a subsidiary of Community Health Systems that provides advice on physician employment and termination decisions to other Community Health Systems subsidiaries that own health care facilities and employ physicians.

Dr. Hansen's practice at the Hospital was initially successful. The Hospital aggressively marketed Dr. Hansen and the new heart program, and Dr. Hansen performed approximately ten to fifteen procedures each month, including procedures that had not historically been done at the Hospital. Dr. Hansen was on pace to perform 100 procedures the first year and suggested that if another surgeon was hired, the Hospital could perform 200 procedures per year. At the end of Dr. Hansen's first contract year, PSC and the Hospital projected that the number of heart surgeries performed at the Hospital would continue to increase and yield financial returns.

At the end of 2008, however, the number of cardiovascular surgeries

performed by Dr. Hansen began to decline significantly due to a series of personal disagreements with two local cardiologists, Dr. Marcel Lechin, M.D. and Dr. Mario Lammoglia, M.D. Dr. Lechin and Dr. Lammoglia were the senior members of a three-member cardiologist team, BCS Heart, which was Dr. Hansen's primary source of patient referrals.² PSC's vice president of practice management, Leslie Luke, became concerned and sent a letter to Jackson on February 11, 2009, recommending that Dr. Hansen's employment be terminated "without cause" at the end of the third contract year. Luke explained that: (1) Dr. Hansen's high salary—$750,000 per year—was disproportionate to the number of hospital procedures he performed; (2) Dr. Hansen's "clinic practice lost $1 million"; and (3) Luke predicted no future growth in the number of procedures. In June 2009, the chief financial officer of the Hospital approached Dr. Hansen to discuss his decreased billings and how to increase his billings. Nevertheless, the relationship between Dr. Hansen and the cardiologists continued to deteriorate and affect Dr. Hansen's practice.

In August 2009, Dr. Hansen had another dispute with Dr. Lechin, causing Dr. Lechin and Dr. Lammoglia to place Dr. Hansen and the Hospital on "drive-by" status, meaning that they would not refer new patients to Dr. Hansen for surgery at the Hospital. As a result of the ongoing disagreement, which Dr. Hansen described as a "turf battle," Dr. Hansen similarly refused to accept patients from the two doctors until they "cleared the air" in a joint meeting. After the meeting just one week later, Dr. Lechin and Dr. Lammoglia agreed to resume referring patients to Dr. Hansen, but Dr. Hansen refused to accept the referrals until they issued a public affirmation of his skills as a cardiovascular surgeon. Ultimately, Dr. Hansen declined Dr. Lechin's and Dr. Lammoglia's referrals for approximately four months—from August 2009 to December 2009. Consequently, from August 5, 2009, to June 1, 2010, Dr. Hansen performed only eight heart surgeries.

At the annual meeting of REAP's board of directors in November 2009, Luke discussed Dr. Hansen's refusal to accept Dr. Lechin's and Dr. Lammoglia's referrals and stated that, except for providing emergency assistance, Dr. Hansen had not worked since September 2009. The meeting minutes noted that the purpose of the discussion "was to prepare the Board for a possible termination" if Dr. Hansen continued to refuse referrals and not fulfill his employment duties. On February 18, 2010, a PSC administrator, Ashley Bosshart, sent an email notifying the members of the REAP Board that Jackson had requested that REAP terminate Dr. Hansen's contract without cause due to his "past behavioral issues and his significant clinic losses." The email also attached the minutes from the November 2009 meeting and noted that Dr. Hansen's "annual losses" were $1,003,138 in calendar year 2008 and $908,609 in calendar year 2009. A few days later, but before the end of the third contract year, the REAP Board voted to terminate Dr. Hansen without cause at the end of his third contract year under section 10.1. Following the vote, Luke and Bosshart completed a "Personnel Action Form" reflecting that Dr. Hansen had been terminated for "unsatisfactory performance" and was not eligible for rehire. Subsequently, on June 1, 2010, REAP sent Dr. Hansen a letter providing sixty days' notice that it was terminating the contract without cause.

Thereafter, Dr. Hansen sued numerous parties alleging multiple causes of action. In his sixth amended petition, Dr. Hansen alleged that: (1) REAP is liable for breach of contract and breach of fiduciary duties; (2) the Hospital and Jackson are liable for business disparagement, tortious interference with contract, and restraint of trade; and (3) PSC is liable for business disparagement and tortious interference with contract.³ In response, PSC filed an amended no-evidence and traditional motion for summary judgment. REAP, the Hospital, and Jackson, however, rested on their previously filed traditional and no-evidence motion for summary judgment. The trial court granted the defendants' summary-judgment motions without explaining the basis for its ruling.

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