Delaware Valley Transplant Program v. Coye, Civ. A. No. 88-0548(SSB).

• Decision Date: 16 October 1989
• Docket Number: Civ. A. No. 88-0548(SSB).
• Citation: 722 F. Supp. 1188
• Parties: DELAWARE VALLEY TRANSPLANT PROGRAM, Veronica Durkin, Marianne Fletcher, Glenn Miller, Joyce Battle, Plaintiffs, v. Molly Joel COYE, M.D., M.P.H. Commissioner, State of New Jersey, Department of Health, Defendant, and New Jersey Organ and Tissue Network, Intervenor.
• Court: U.S. District Court — District of New Jersey

722 F. Supp. 1188

DELAWARE VALLEY TRANSPLANT PROGRAM, Veronica Durkin, Marianne Fletcher, Glenn Miller, Joyce Battle, Plaintiffs, v. Molly Joel COYE, M.D., M.P.H. Commissioner, State of New Jersey, Department of Health, Defendant and New Jersey Organ and Tissue Network, Intervenor.

Civ. A. No. 88-0548(SSB).

United States District Court, D. New Jersey.

October 16, 1989.

Gary J. Lesneski and Deborah H. Simon, Archer & Greiner, P.C., Haddonfield, N.J., for plaintiffs.

Office of the Atty. Gen. of New Jersey by Michael J. Haas, Deputy Atty. Gen., Div. of Law, Trenton, N.J., for defendant.

Murray J. Klein and Robert Ross, Cohen, Shapiro, Polisher, Shiekman and Cohen, Lawrenceville, N.J. and Judah I. Labovitz, Cohen, Shapiro, Polisher, Shiekman and Cohen, Philadelphia, Pa., for intervenor.

BROTMAN, District Judge.

Presently before the court are the motion of Intervenor New Jersey Organ and Tissue Sharing Network "Network" for summary judgment and the cross-motion of Plaintiff Delaware Valley Transplant Program "DVTP" for summary judgment on Network's counterclaims. Defendant Molly Joel Coye, Commissioner of the New Jersey Department of Health the "Commissioner", has filed a brief in support of Network's motion for summary judgment.

These motions present difficult issues involving interjurisdictional preclusion, the full faith and credit statute, 28 U.S.C. § 1738 (1982), the Eleventh Amendment, and the federal abstention doctrines. See Younger v. Harris, 401 U.S. 37, 91 S.Ct. 746, 27 L.Ed.2d 669 (1971); Railroad Commission of Texas v. Pullman, 312 U.S. 496, 61 S.Ct. 643, 85 L.Ed. 971 (1941).

I. FACTS AND PROCEDURE

In 1984, the federal government¹ organized the Task Force on Organ Transplantation to file a report with the Secretary of Health and Human Services.² The Task Force studied the medical, legal, ethical, economic and social issues presented by human organ procurement and transplantation, and filed its report in April, 1986. One of the issues addressed was the effectiveness of "organ procurement agencies" "OPAs" such as DVTP and Network. The Task Force observed that competition was often damaging to the organ procurement process, and further noted that because "large OPAs are more effective than small ones, amalgamating several small agencies operating in an area would improve organ procurement." The Task Force also noted that OPAs that became too large were also ineffective.

In August 1986, the Commissioner appointed a statewide task force to make a similar report concerning:

I. The consolidation and coordination of transplant organ retrieval in the State;

II. The equitable allocation of donated organs among transplant centers and patients; and

III. The equitable accessibility of transplantation and subsequent drug therapy to all medically qualified patients.

Pretrial Order at 12. At this time there were three New Jersey-based OPAs: Transplant Foundation of New Jersey, Northern New Jersey Organ Procurement Program, and Our Lady of Lourdes Medical Center. Transplant Foundation and Northern New Jersey Organ Procurement both served the northern New Jersey area, while Our Lady of Lourdes served southern New Jersey along with DVTP, the only non-New Jersey-based OPA. In early 1987 Transplant Foundation and Northern New Jersey Organ Procurement Program merged; the combined organization, the defendant Network, received a Certificate of Need ("CON") conditioned on its filing an application to become the sole statewide OPA.³ Pretrial Order at 28.

In August, 1987, the state task force issued a draft report. In September, 1987, Network filed an application for a CON. Pursuant to the New Jersey statutory scheme, all potential affected persons were notified, including DVTP, and advised that they would be able to make a presentation to the appropriate state agency. By November, Network had entered into a preliminary agreement to merge with Our Lady of Lourdes, the remaining New Jersey-based OPA.

Also at this time, DVTP made efforts to obtain a hearing on the propriety of issuing a CON to Network. Pretrial Order at 37, 41. DVTP was informed that Network was trying to consolidate into "a single statewide organ retrieval agency for the state through the integration of Our Lady of Lourdes Medical Center's organ procurement and transplant program." Pretrial Order at 36. As a transfer of ownership, the New Jersey Statewide Health Coordinating Council took the position that the application satisfied the "criteria for administrative review." Pretrial Order at 36. DVTP was further informed that "it has been our policy not to conduct a public review of applications in administrative review because there is no forum at the state level to where our views would be considered." Pretrial Order at 38. See Pretrial Order at 41 (the "Regulation and Statutes do not afford DVTP the right to this procedure a hearing"); id. at 42. DVTP did, however, provide statistical evidence and comments that were discussed at the December meeting of the Statewide Health Coordinating Council. Pretrial Order at 41. Subsequently, a Certificate of Need Analyst reviewed Network's application and recommended that it be granted. The Assistant Commissioner reviewed the recommendation before forwarding it to the Commissioner.

This controversy centers on the Commissioner's decision on January 27, 1988, to grant a CON to Network to act as "an independently organized statewide organ retrieval agency for New Jersey." Pretrial Order at 42. The parties vigorously disputed whether the CON granted Network the exclusive right to act as an OPA within New Jersey. To a large extent, that dispute continues.

On January 29, 1989, plaintiffs⁴ filed suit in the federal district court for the District of New Jersey claiming that: (1) the Commissioner's issuance of the CON to Network violates plaintiffs' rights of interstate travel, equal protection, and substantive due process; (2) the Commissioner's actions are inconsistent with and preempted by federal regulations; and (3) the Commissioner's designation violates the Commerce Clause. Soon thereafter, Network intervened.

On February 3, 1988, after concluding that DVTP had made the required showing, this court preliminarily enjoined the Commissioner from implementing her decision designating Network as the sole OPA for the State of New Jersey pending the final outcome of this litigation, or until such other time as the court might so direct. Delaware Valley Transplant Program, 678 F.Supp. at 483. Soon thereafter, Network filed a counterclaim seeking to stop DVTP from operating in New Jersey because it did not have a CON. Network also included a claim of tortious interference relating to two organ procurements by Network, one at the William B. Kessler Memorial Hospital in April, 1987, and the other at Helene Fuld Medical Center in June, 1987.

On March 11, 1988, DVTP instituted a related action in the New Jersey Superior Court, Appellate Division, against the Commissioner and Network.⁵ The papers filed in the New Jersey proceeding informed the state court of the pending federal action and stated that DVTP had commenced the action "to preserve certain issues of state law which cannot be adjudicated in the federal action." Although DVTP apparently sought a stay in the state court proceeding to allow for the development of a factual record in the federal proceeding, the state court declined to grant the stay, and on July 12, 1989, the New Jersey Superior Court affirmed the issuance of the CON. Delaware Valley Transplant Program v. Molly J. Coye, M.P.H., Commissioner, State of New Jersey Department of Health, and New Jersey Organ and Tissue Sharing Network, Inc., No. A-3108-87T7 (N.J.Super.Ct.App.Div. July 12, 1989) (per curiam).

DVTP's position throughout the litigation has been that the Commissioner's decision to authorize Network as the sole statewide OPA is an impermissible protectionist effort to assure that organs retrieved from patients in New Jersey hospitals are used only for in-state transplants. Delaware Valley, 678 F.Supp. at 481. Essentially, DVTP argues that the Commissioner and Network acted to consolidate the relatively small New Jersey-based OPAs into one large statewide OPA out of fear that, as a result of the federal government Task Force's recommendation that small OPAs be merged into larger regional OPAs which operate more efficiently, the northern New Jersey OPAs would be coopted into a single New York metropolitan area OPA while the southern New Jersey OPAs would be merged into a Philadelphia metropolitan OPA. Network's position, as well as that of the Commissioner, is that the merger of the three New Jersey based OPAs is not a protectionist measure but is intended only to make the transplant procurement process more efficient. Network and the Commissioner claim that any effort to limit the organizations that may procure organs in no way restricts the organizations that may receive organs.

Network has now moved for summary judgment in this court and claims that the state court determination collaterally estops DVTP from pursuing its claim in the federal action. The Commissioner supports Network's motion, although the Commissioner additionally relies on the doctrine of res judicata.⁶ DVTP, on the other hand, denies that Network is entitled to summary judgment on either ground and moves for summary judgment on Network's counterclaims. Network opposes DVTP's motion for summary judgment and asserts that it is untimely and that Network may maintain a common law action for unfair competition. Despite the court's express invitation, the Commissioner takes no position as to the legal issues involved in the counterclaims.

II. DISCUSSION

The standard for granting summary judgment is a stringent one. A court may grant summary judgment only when the materials of record "show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law."...