Gallagher v. Penobscot Cmty. Healthcare

• Decision Date: 21 March 2017
• Docket Number: SUPERIOR COURT CIVIL DIVISION DOCKET NO. CV-16-54
• Parties: WILLIAM F. GALLAGHER, M.D., Plaintiff, v. PENOBSCOT COMMUNITY HEALTHCARE, ROBERT P. ALLEN, M.D., NOAH NESIN, M.D. TERRY WHITE, and LORI DWYER, ESQ., Defendants.
• Court: Maine Superior Court

WILLIAM F. GALLAGHER, M.D., Plaintiff, v. PENOBSCOT COMMUNITY HEALTHCARE,ROBERT P. ALLEN, M.D., NOAH NESIN, M.D.TERRY WHITE, and LORI DWYER, ESQ., Defendants.

SUPERIOR COURT CIVIL DIVISION DOCKET NO. CV-16-54

Superior Court of Maine

March 21, 2017

STATE OF MAINE

PENOBSCOT, ss.

ORDER ON DEFENDANTS' MOTION TO DISMISS

Before the Court is Defendants Penobscot Community Healthcare, Robert Allen, Noah Nesin, Terry While, and Lori Dwyer's motion to dismiss. Defendants move, pursuant to M.R. Civ. P. 12(b)(6), to dismiss all claims brought against them in Plaintiff's complaint. Hearing was held on this matter on November 29, 2016. Having reviewed the parties' filings and their respective arguments, and for the reasons stated below, Defendants' motion to dismiss is hereby granted in part, denied in part, and decision is reserved in part.

BACKGROUND

This action stems from the alleged improper conduct by doctors and staff at Penobscot Community Healthcare ("PCHC") in connection with the termination of Dr. Gallagher's employment.¹ The following factual background accepts facts from Plaintiffs' complaint, which are deemed true when evaluating a motion to dismiss.

Dr. Gallagher, a licensed and board-certified dermatologist, and PCHC entered into a Professional Employment Agreement ("employment contract") on January 25, 2008, whereby Dr. Gallagher agreed to perform professional medical services in return for compensation from PCHC. (Pl.'s Compl. ¶¶ 8, 14-15.) On that same day, Dr. Gallagher entered into an Asset Transfer Agreement ("asset agreement"), in which PCHC acquired Dr. Gallagher's entire private practice. (Id. ¶ 16-17.) The employment contract states that employment may be terminated as follows:

Termination. This Agreement may be terminated by either party without cause upon sixty (60) days advance written notice to the other party.

Immediate Termination. Notwithstanding any other provision of this Agreement, PCHC may immediately terminate this Agreement in the event that Employee . . . fails to meet what it considers critical terms of the Agreement.

(Ex. A §§ 10.2-10.3.)² One of the critical terms of the contract describes the standard of practice expected of the employee under the agreement:

Standard of Practice. Employee shall retain independent medical judgment and responsibility for the practice of medicine. However, Employee shall comply with procedures which may be established and/or adopted by PCHC to assure the consistency and quality of all services. Physician shall deliver services in a competent and professional manner, consistent with quality assurance and utilization review standards of PCHC

(Id. § 3.)

Sometime after Dr. Gallagher joined PCHC, staff complained that he was "old school," among other complaints, and these complaints were investigated by Defendants. (Pl.'s Compl. ¶¶ 19-20.) Plaintiff alleges that PCHC insufficiently investigated staff complaints because the investigation relied on inaccurate complaints and excluded positive information provided by other witnesses. (Id. ¶ 20.) Dr. Gallagher protested to Defendants about the insufficiency of their investigation until he was threatened with adverse employment action if he did not cease and desist his own attempts to investigate the complaints. (Id. ¶ 22.) Dr. Allen, Executive Medical Director, stated to Dr. Gallagher that the investigation was "not undertaken with intellectual vigor" and told Dr. Gallagher to retire, which he declined to do. (Id. ¶ 23-24.) No evidence was uncovered suggesting that Dr. Gallagher's conduct interfered with his ability to provide quality medical care to his patients. (Id. ¶ 26.)

Additionally, between 2008 and 2013, at least one patient complained that Dr. Gallagher was elderly, senile, and demented.³ (Id. ¶ 20.) Plaintiff alleges that investigations into patient complaints were mishandled in a similar fashion as the investigations into staff complaints. (Id. ¶¶ 31-34.)

On or about June 27, 2013, PCHC suspended Dr. Gallagher from employment effective July 1, 2013, due to staff complaints.⁴ (Id. ¶ 28.) On or about April 3, 2014, Dr. Gallagher's employment was terminated by PCHC on the basis of patient complaints that were unrelated to age. (Id. ¶¶ 31, 45-46.) Plaintiff claims these adverse employment actions were just part of a"continued pattern of willful, illegal, and unjustified adverse treatment and employment action taken against Dr. Gallagher starting as early as 2010." (Id.) Specifically, Plaintiff alleges that Dr. Allen chose an arbitrary number of patient complaints—two per year—as a pre-textual basis for taking adverse employment actions against Dr. Gallagher. (Id. ¶ 38.) Additionally, Plaintiff alleges that PCHC misrepresented the basis for its employment decision. (Id. ¶ 29.)

In December 2012, PCHC advertised to fill a new dermatology position. (Id. ¶ 50.) In February 2013, a few months before Dr. Gallagher's employment was suspended, PCHC hired another dermatologist, Elaine Eliezer, to "help [Dr. Gallagher] out" and "to help him change patients' perception of him."⁵ (Id. ¶ 51.)

Dr. Gallagher alleges that PCHC and the individually named defendants "published oral and written false and defamatory statements about his professional relations with staff and patients, . . . making them known to third parties."⁶ (Id. ¶ 86.) These statements included the following:

• Dr. Gallagher bullied, intimidated, and verbally and physically abused staff.

• Dr. Gallagher retaliated against staff who complained of his behavior.

• Dr. Gallagher had too many staff and patient complaints and these complaints were substantiated as true and accurate and were serious enough to affect his position at PCHC and his medical license.

• Kenneth Nadeau, PA-C did not trust Dr. Gallagher's clinical judgment.

• Dr. Gallagher mistreated, intimidated, discriminated against, and neglected patients.

• Dr. Gallagher provided patients with care that was inappropriate or otherwise did not meet PCHC's standards.

• Dr. Gallagher misused medical equipment with patients.

• Dr. Gallagher was too old to care for patients and was senile and suffered from dementia during the time he cared for them.

(Id. ¶¶ 87-88.) During Dr. Gallagher's time with PCHC, Defendants made offensive remarks about his age so frequently that it created a hostile or offensive work environment. (Id. ¶ 58.) As a result, Dr. Gallagher "has suffered and will continue to suffer severe emotional pain, distress, suffering, mental anguish, loss of enjoyment of life, inconvenience, loss of reputation, loss of past and future income, and other non-pecuniary losses, as well as pecuniary losses and attorney's fees, costs, expenses, and other damages." (Id. ¶ 66.)

Plaintiff alleges several claims: (1) age discrimination under the Maine Human Rights Act ("MHRA"), (2) retaliation under the MHRA, (3) intentional infliction of emotional distress, (4) negligent infliction of emotional distress, (5) defamation, (6) injurious falsehood, (7) tortious interference with existing and prospective advantageous economic relations, and (8) breach of contract.

DISCUSSION

I. Legal Standard for Motion to Dismiss

Dismissal of a complaint is proper only when the complaint fails to state a claim for which relief may be granted. See M.R. Civ. P. 12(b)(6). A motion to dismiss tests the legal sufficiency of the complaint, In re Wage Payment Litig. v. Wal-Mart Stores, Inc., 2000 ME 162, ¶ 3, 759 A.2d 217, and is a pure question of law. Persson v. Dep't of Human Servs., 2001 ME 124, ¶ 8, 775 A.2d 363. Generally, to be sufficient, a complaint need only consist of a short and plain statement of the claim to provide fair notice of the cause of action. Johnston v. Me. Energy Recovery Co., Ltd. P'ship, 2010 ME 52, ¶ 16, 997 A.2d 741. However, allegations of fraud must be pled with particularity. M.R.Civ.P. 9(b); Bean v. Cummings, 2008 ME 18, ¶ 8, 939 A2d 676.

When deciding a motion to dismiss, courts must accept as true all well-pleaded facts in the complaint and construe most favorably to the plaintiff all reasonable inferences that can be drawn from those facts. McClosky v. Mueller, 446 F.3d 262, 266 (1st Cir. 2006). "A dismissalshould only occur when it appears beyond doubt that a plaintiff is entitled to no relief under any set of facts that he might prove in support of his claim." Moody, 2004 ME 20, ¶ 7, 843 A.2d 43 (quotation marks omitted). "At this stage of the proceedings, '[t]he issue is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims.'" Jackson v. Birmingham Bd. of Educ., 544 U.S. 167, 184 (2005).

II. Claims under the Maine Human Rights Act (Counts 1 & 2)

Plaintiff alleges that Defendants discriminated against him based on his age, and thus violated his rights under the MHRA. Additionally, Plaintiff alleges that Defendants unlawfully retaliated against him.

As a threshold matter, in order for a plaintiff to take advantage of the full array of remedies available under the MHRA, he must exhaust administrative remedies prior to filing a complaint. 5 M.R.S. § 4622 (2011). Section 4622 prohibits a plaintiff from recovering attorney fees, civil penal damages, compensatory damages, or punitive damages unless he "alleges and establishes that, prior to the filing of the civil action, the plaintiff first filed a complaint with the [Maine Human Rights C]ommission" and that the commission has taken some final action on the administrative charge. Id.; see also Gordan v. Cummings, 2000 ME 68, ¶ 11, 756 A.2d 942.

Dr. Gallagher did not file a complaint with the Maine Human Rights Commission prior to filing the present action. Therefore, his remedies are limited with respect to the MHRA counts.

A. Individual Defendants

Dr. Gallagher is pursuing both an age-discrimination claim and a retaliation claim under the MHRA. In addition to naming his employer PCHC as a defendant, he has also sued four individual defendants in this action, and seeks relief under the MHRA as to...