Ezpeleta v. Sisters of Mercy Health Corp.

• Decision Date: 09 July 1985
• Docket Number: No. H 83-143.,H 83-143.
• Citation: 621 F. Supp. 1262
• Parties: Elena EZPELETA, M.D., Plaintiff, v. SISTERS OF MERCY HEALTH CORPORATION, a Michigan Corporation, Defendant.
• Court: U.S. District Court — Northern District of Indiana

621 F. Supp. 1262

Elena EZPELETA, M.D., Plaintiff, v. SISTERS OF MERCY HEALTH CORPORATION, a Michigan Corporation, Defendant.

No. H 83-143.

United States District Court, N.D. Indiana, Hammond Division.

July 9, 1985.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Robert G. Berger, Highland, Ind., for plaintiff.

George E. Bloom, U.S. Dept. of Justice, Hammond, Ind., David A. Ettinger, Honigman, Miller, Schwartz & Cohn, Detroit, Mich., for defendant.

ORDER DENYING PLAINTIFF'S MOTION FOR PRELIMINARY INJUNCTION AND GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT

KANNE, District Judge.

Before the court is plaintiff's application for preliminary injunction and defendant's motion for summary judgment.¹

Under FED.R.CIV.P. 56(c), summary judgment may only be granted if "the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as matter of law." FED.R. CIV.P. 56(c). Thus, summary judgment serves as a vehicle with which the court "can determine whether further exploration of the facts is necessary." Hahn v. Sargent, 523 F.2d 461, 464 (1st Cir.1975), cert. denied, 425 U.S. 904, 96 S.Ct. 1495, 47 L.Ed.2d 754 (1975).

In making this determination, the court must draw all inferences from the established or asserted facts in favor of the nonmoving party. Peoples Outfitting Co. v. General Electric Credit Corp., 549 F.2d 42 (7th Cir.1977). However, a party opposing the motion may not rest on the mere allegations of his pleadings or the bare contentions that an issue of fact exists. Posey v. Skyline Corp., 702 F.2d 102, 105 (7th Cir.1983), cert. denied, 464 U.S. 960, 104 S.Ct. 392-393, 78 L.Ed.2d 336 (1983). See Adickes v. S.H. Kress & Co., 398 U.S. 144, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970). See generally, C. Wright, Law of Federal Courts, § 99 (4th ed. 1983); 6 Moore's Federal Practice, § 56.15 (2d ed. 1983).

Even if there are some disputed facts, where the undisputed facts are the material facts involved and those facts show one party is entitled to judgment as a matter of law, summary judgment is appropriate. Egger v. Phillips, 710 F.2d 292, 296-97 (7th Cir.1983), cert. denied, 464 U.S. 918, 104 S.Ct. 284, 78 L.Ed.2d 262 (1983). Further, if the court resolves all factual disputes in favor of the nonmoving party and still finds summary judgment in favor of the moving party is correct as a matter of law, then the moving party is entitled to summary judgment in his favor. Id. at 297. See also, Bishop v. Wood, 426 U.S. 341, 348 n. 11, 96 S.Ct. 2074, 2079 n. 11, 48 L.Ed.2d 684 (1976).

Finally, the existence of difficult or complicated questions of law without genuine issue of material facts does not prevent a summary judgment. The court will decide the issues raised by the parties in light of these principles.

Turning now to the undisputed facts, plaintiff, Elena Ezpeleta, is a medical doctor whose speciality is anesthesiology. Defendant operates Our Lady of Mercy Hospital (OLM), a small private medical facility located in Dyer, Indiana. Like many hospitals in Indiana it does not employ salaried physicians to perform medical services. The medical staff is made up of independent contractors and their employees. In the case of the anesthesiology department a professional medical corporation, Suburban Anesthesia Associates, had an exclusive contract to provide anesthesiology services to OLM during the initial period in which this action arises. While an independent contractor may employ physicians, the right of an individual physician to practice in the hospital is subject to the granting of "staff privileges". Without staff privileges no physician, regardless of his employment with a contract provider, can practice in the hospital. Standards for admission and continued staff membership is determined by the hospital.

Plaintiff was an employee of Suburban Anesthesia Associates and in August of 1981 she was granted probationary staff privileges at OLM.

In 1981 Dr. Richard Markey headed Suburban Anesthesia Associates and hired other doctors, on behalf of the corporation, to practice anesthesiology at OLM. Some of the physicians-employees were also shareholders of the corporation. The plaintiff, however, was a salaried employee only.

In addition to his role with the corporation, Dr. Markey headed the anesthesiology department at OLM from 1965 until his retirement in February of 1982. Under Dr. Markey the anesthesiology department was operated informally without written guidelines. There was no formal work schedule for the anesthesiologists and they would choose or be assigned their cases in the operating room.

In the late 1970's the Joint Accreditation Committee issued a report critical of the anesthesiology department at OLM. Thereafter, the hospital, with the assistance of Dr. Markey, sought to improve and upgrade the anesthesiology department. Eventually, Dr. Markey, who suffered from a heart condition, announced his retirement and a new exclusive provider for anesthesiology services was sought to replace Suburban Anesthesia Associates.

Ultimately the hospital entered into a contract with Dr. Shiree Ahmad. The contract provided that as an independent contractor Dr. Ahmad would have the exclusive right to provide anesthesiology services at OLM either personally or through physicians employed by her. The exception to this exclusive contract was that the plaintiff and another physician with staff privileges (both employees of Suburban Anesthesia Associates) could continue to practice anesthesiology at OLM.

In addition to her exclusive contract with OLM, Dr. Ahmad also became head of the anesthesiology department. As the department head Dr. Ahmad had the authority and responsibility for establishing new policies and procedures. Of particular importance to this case, Dr. Ahmad was responsible for reviewing and evaluating medical abilities of physicians practicing anesthesiology at OLM.

The anesthesiologist department underwent numerous changes. For purposes of this opinion it suffices to say that Dr. Ahmad instituted a much more organized and structured department than had existed under Dr. Markey.

The plaintiff is not board certified in anesthesiology, nor was Dr. Markey. Dr. Markey expressed satisfaction with the plaintiff's medical ability and had intended to eventually offer her ownership rights in Suburban Anesthesia Associates.

Prior to entering into the contract with OLM, Dr. Ahmad had served as an instructor with a large metropolitan teaching hospital, Northwestern University Hospital in Chicago. Dr. Ahmad is board certified and has clinical anesthesiology experience.

During and after the transition in the anesthesiology department at OLM plaintiff continued to have only probationary staff privileges.

In the period of February through April of 1982, Dr. Ahmad formally evaluated plaintiff's work and found it unsatisfactory. In May of 1982 Dr. Ahmad informed plaintiff of the unsatisfactory evaluation. Thereafter, acting on Dr. Ahmad's recommendation, plaintiff was allowed to retain her probationary staff privileges for an additional three months. However, during this three month period Dr. Ahmad's opinion of plaintiff's medical ability and performance did not change.

In August of 1982, Dr. Ahmad recommended to Dr. Cespedes, chairman of the surgery department, that plaintiff should be denied continuation of staff privileges. Dr. Cespedes agreed with Dr. Ahmad, and thereafter Dr. Ahmad's recommendation was presented to and reviewed by various hospital committees consisting of medical personnel and hospital administrators. During these committee proceedings plaintiff defended against Dr. Ahmad's charges that she was medically deficient. Plaintiff personally appeared before one of the committees. She also submitted a written statement. Also near the end of the review process plaintiff had the assistance of legal counsel.

Plaintiff's probationary staff privileges were suspended by the hospital in October of 1982, and in January of 1983 those staff privileges were terminated. The basis for the termination of plaintiff's probationary staff privileges was stated as her poor performance, and, to a lesser degree a misstatement on her application for admission to the hospital staff.

In all, plaintiff held probationary staff privileges at OLM for approximately fourteen months; eight months under Dr. Markey as department head and six months under Dr. Ahmad.

Plaintiff's lawsuit seeks equitable relief in the form of reinstatement of staff privileges and monetary damages. The complaint alleges three separate theories of recovery against defendant. First, plaintiff alleges that the defendant violated federal antitrust laws in particular Section 1 and Section 2 of the Sherman Act, 15 U.S.C. § 1 and § 2. Second, plaintiff alleges that her discharge violated plaintiff's federal constitutional rights under the First and Fourteenth Amendments. Finally, plaintiff asserts that defendant's actions were arbitrary, capricious and unfair. The court will decide each theory separately.

Plaintiff first contends that the provisions of the Sherman Act were violated by a proposed contract and Dr. Ahmad's exclusive services contract with the hospital.

It is plaintiff's position that the proposed contract for staff privileges as an independent contractor was illegal because it contained the following clause:

Continuance as an anesthesiologist in practice at the hospital beyond the terms of this agreement will be based upon a satisfactory evaluation by the medical director. The physician will be notified in writing by the medical director of this decision thirty (30) days prior to the end of the agreement. If this agreement is not continued, the physician's medical staff membership and privileges will be automatically terminated without recourse to the fair

...