Cooperman v. University Surgical Associates, Inc.

• Decision Date: 02 September 1987
• Docket Number: No. 86-1757,86-1757
• Citation: 32 Ohio St.3d 191,513 N.E.2d 288
• Parties: , 42 Ed. Law Rep. 359 COOPERMAN, Appellee and Cross-Appellant, v. UNIVERSITY SURGICAL ASSOCIATES, INC.; Carey et al., Appellants and Cross-Appellees.
• Court: Ohio Supreme Court

Page 191

32 Ohio St.3d 191

513 N.E.2d 288, 42 Ed. Law Rep. 359

COOPERMAN, Appellee and Cross-Appellant, v. UNIVERSITY SURGICAL ASSOCIATES, INC.; Carey et al., Appellants and Cross-Appellees.

No. 86-1757.

Supreme Court of Ohio.

Sept. 2, 1987.

Syllabus by the Court

1. An action against a state officer or employee will be treated as one against the state for purposes of R.C. Chapter 2743 where the state, though not a party to the suit, is the real party against which relief is sought, and where a judgment for the plaintiff, though nominally against the defendant as an individual, could operate to control the action of the state or subject it to liability. (State ex rel. Williams v. Glander [1947], 148 Ohio St. 188, 35 O.O. 192, 74 N.E.2d 82, approved and followed.)

2. A court of common pleas does not lack jurisdiction over an action against state officers or employees merely because the Court of Claims has not first determined that the act or omission, which is the subject of the action, was manifestly outside the scope of the officer's or employee's office or employment, or that the officer or employee acted with malicious purpose, in bad faith, or in a wanton or reckless manner, unless the aggrieved party has filed a suit in the Court of Claims based on the same act or omission. (R.C. 2743.02[A], construed and applied.)

3. To state a cause of action, under Section 1983, Title 42, U.S.Code, for unauthorized intentional property deprivations, a claimant must allege not only that he is legitimately entitled to the property, but also that he was deprived of the property without a meaningful opportunity to be heard.

4. If the state is able, through adequate postdeprivation tort remedies, to compensate a claimant for unauthorized intentional deprivations of property, the state has provided all the "process" which is due under the Fifth and Fourteenth Amendments for purposes of Section 1983, Title 42, U.S.Code. (Hudson v. Palmer [1984], 468 U.S. 517, 104 S.Ct. 3194, 82 L.Ed.2d 393, applied.)

This is an appeal by defendants-appellants and cross-appeal by plaintiff-appellee from a decision of the Franklin County Court of Appeals. The appellate decision reversed in part and affirmed in part the judgment of the court of common pleas.

Plaintiff-appellee and cross-appellant, Dr. Marc Cooperman, commenced this action on March 1, 1985 in the court of common pleas. Appellee's amended complaint, containing eleven counts, alleged various causes of action arising from appellee's employment as a staff surgeon at the Ohio State University Hospitals. Named as defendants to that action were appellants and cross-appellees, Dr. Larry C. Carey, Chairman of the hospital's Department of Surgery and a member of the teaching faculty at the OSU College of Medicine; Dr. Manuel Tzagournis, Dean of the College of Medicine and OSU's Vice President for Health Services; and Dr. Hagop Mekhjian, Associate Dean of the College of Medicine and Medical Director of the hospital. Also designated as defendants were the individually named members of the OSU Board of Trustees, the individually named members of the OSU Hospitals Board, University Surgical Associates, Inc. ("USA"), and several hospital staff physicians who are either shareholders or employees of USA.

Count One of the amended complaint alleged that appellants violated Section 1983, Title 42, U.S.Code, in that appellant Carey used his position as Chairman of the Department of Surgery to deprive appellee of certain property rights for Carey's own personal gain, and that appellants Tzagournis and Mekhjian refused to take action to remedy the situation and directly participated in efforts to impede appellee's career. Count Six alleged slander as against Carey. Count Seven charged Carey, Tzagournis, Mekhjian and others with conspiring to restrain trade. Count Eight alleged that Carey, Tzagournis, Mekhjian and others conspired to monopolize surgery services at the hospital. Count Ten charged Carey, Tzagournis , Mekhjian and others with conspiring to interfere with appellee's business relationships.

Appellants, ¹ along with certain other of the named defendants, moved to dismiss Counts One and Six in their entirety, and to dismiss themselves as defendants from Counts Seven, Eight and Ten on the grounds that the trial court lacked subject-matter jurisdiction over these counts with regard to these defendants, and that the complaint failed to state a claim upon which relief can be granted. The trial court granted the motion to dismiss on the grounds that the court lacked subject-matter jurisdiction pursuant to R.C. Chapter 2743 and R.C. 9.86.

The court of appeals affirmed in part, reversed in part, and remanded. The court upheld the trial court's dismissal of Count One, reasoning that appellee failed to allege a constitutional deprivation sufficient to state a claim under Section 1983. The appellate court reversed the judgment of the trial court as to Counts Six, Seven, Eight and Ten. The court of appeals held that appellee had sufficiently alleged that Carey, Tzagournis and Mekhjian acted beyond the scope of their official duties so as to vest the court of common pleas with subject-matter jurisdiction over Counts Six, Eight and Ten. As to Count Seven, the court of appeals upheld the dismissal of Tzagournis and Mekhjian on the basis of lack of subject-matter jurisdiction, in that there was no allegation in that count that these appellants acted outside the scope of their employment. The court found, however, that appellee had sufficiently alleged a cause of action against Carey under Count Seven.

The court also rejected appellee's argument that the members of the OSU Board of Trustees and the OSU Hospitals Board should not have been dismissed from Count One. The court reasoned that the naming of the board members as individuals was insufficient to remove this action against them from the exclusive jurisdiction of the Court of Claims, and that, in any event, appellee failed to allege a constitutional deprivation sufficient to sustain a Section 1983 action.

The cause is now before this court upon the allowance of a motion and cross-motion to certify the record.

Chester, Hoffman & Willcox, John J. Chester, Charles R. Saxbe and Donald C. Brey, Columbus, for appellee and cross-appellant.

Anthony J. Celebrezze, Jr., Atty. Gen., Gary E. Brown, Vorys, Sater, Seymour & Pease, John C. Elam, Sandra J. Anderson and Laura G. Kuykendall, Columbus, for appellants and cross-appellees.

STRAUSBAUGH, Justice.

The instant appeal and cross-appeal present numerous and substantial issues for resolution by this court. We will first address the question of whether the court of common pleas had subject-matter jurisdiction to proceed in this case with regard to appellants Carey, Tzagournis and Mekhjian. For the reasons which follow, we hold that neither R.C. Chapter 2743 nor R.C. 9.86 divests the common pleas court of subject-matter jurisdiction under these facts.

Appellants contend that the courts of common pleas do not have jurisdiction over an action against state officials and employees when the state of Ohio is the real party in interest, citing, inter alia, R.C. Chapter 2743. While we acknowledge the general truth of this proposition, State ex rel. Williams v. Glander (1947), 148 Ohio St. 188, 193, 35 O.O. 192, 195, 74 N.E.2d 82, 85, we reject its application in the instant cause. As such, our analysis must begin with a review of the relevant portions of the amended complaint.

Count One alleges that appellants and the individually named members of the board of trustees and the hospitals board violated Section 1983, Title 42, U.S.Code. This count states that appellants have, "under color of state law, used their authority as officials at The Ohio State University for the purpose of obtaining personal gain to the detriment and deprivation of the economic rights of * * * [appellee]." More specifically, appellee recites that Carey "used his position as Chairman of the Department of Surgery" to force staff surgeons, including appellee, to join Carey's corporation and share private practice income with Carey in exchange for preferments in staff and faculty appointments and surgery assignments; and to, inter alia, deprive appellee of earned staff appointments, remove appellee from his position as emergency room attending physician, interfere with appellee's business relationships with surgical residents, and relieve appellee of certain teaching assignments. Appellee alleged that these actions deprived him of property rights, and that Tzagournis and Mekhjian, "despite repeatedly being advised of the problems, * * * under color of state law * * * refused to remedy the problems and * * * directly participated in the efforts taken to impede * * * [appellee's] practice of medicine, to the further detriment and deprivation of the economic rights of * * * [appellee]." Appellee further alleged that the individually named members of the board of trustees and the hospitals board, "despite being advised of the problems * * * have, under color of state law, failed to remedy these problems, to the further detriment and deprivation of the economic rights of * * * [appellee]."

Count Six alleges that Carey made certain slanderous statements about appellee's professional abilities at a "Surgical Morbidity and Mortality Conference." The statements were allegedly made to the medical faculty, students and staff in attendance.

Count Seven states that Carey conspired unlawfully to restrain trade and eliminate competition in the provision of surgery services at the hospital in violation of R.C. Chapter 1331. It further alleges that Tzagournis and Mekhjian "acquiesced in and knowingly permitted" Carey's conduct.

Count Eight also alleges a conspiracy to restrain trade and eliminate competition. The complaint names Carey, Tzagournis, Mekhjian and the individual shareholders of USA as co-conspirators.

Count Ten states that app...