Jeung v. McKrow

Decision Date09 April 2003
Docket NumberNo. 01-10204-BC.,01-10204-BC.
Citation264 F.Supp.2d 557
PartiesHoon K. JEUNG, Plaintiff, v. Denise MCKROW, Roger Marshall K. Michael Weaver, Daniel Hittler, Garth M. Murray, and Hills & Dales General Hospital, Inc., Defendants.
CourtU.S. District Court — Eastern District of Michigan

Patrick McLain, Kerr, Russell, Detroit, MI, for plaintiff.

Karen B. Berkery, Kitch, Drutchas, John F. Brady, Brady, Hathaway, Detroit, MI, for defendant.


LAWSON, District Judge.

This case arises from a dispute between the plaintiff, a physician, and the defendants, who participate in the operation of Hills & Dales Hospital, concerning the withdrawal of staff privileges from the plaintiff and the refusal by hospital representatives to honor certain agreements with the plaintiff. The case began in the Tuscola County, Michigan Circuit Court, from whence it was removed by the defendants on the basis of this Court's federal question jurisdiction. See 28 U.S.C. §§ 1331, 1441. The plaintiff has amended his complaint, which now includes claims based on 42 U.S.C. §§ 1981 and 1983. The parties have engaged in extensive, and sometimes contentious, discovery, and there are now several motions pending, including the defendants' motions for partial judgment on the pleadings and for summary judgment. Those motions were referred to the magistrate judge, who conducted a hearing and filed a Report and Recommendation recommending that the motions be granted. The parties have filed timely objections to the recommendation, and the Court has conducted a de novo review of the motions and supporting papers. The Court concludes that to prevail on count I of the complaint, which states a claim under 42 U.S.C. § 1981, the plaintiff must prove, inter alia, that he was deprived of the rights and privileges enumerated in the statute by intentional discrimination on account of race, national origin, ancestry or ethnic characteristics. Although the magistrate judge applied the wrong test in analyzing the Section 1981 claim, the Court concludes nonetheless that the plaintiff has not come forward with sufficient evidence to defeat summary judgment, and the Court will therefore dismiss count I of the amended complaint. The Court also finds that none of the defendants are state actors within the meaning of 42 U.S.C. § 1983, and therefore count II of the amended complaint which is based on that statute must be dismissed. Further, the Court finds that the defendants are not entitled to immunity or attorney fees under the Healthcare Quality Improvement Act, 42 U.S.C. § 11111(a), et seq. Finally, the Court finds that the plaintiffs state law claims are not so devoid of merit as to warrant dismissal, but because some of them raise novel questions under state law, the Court will, in its discretion, decline to exercise supplemental jurisdiction and remand them to state court under 28 U.S.C. § 1367(c).


The magistrate judge has adequately summarized the facts in his report. The plaintiff objects to certain statements therein as irrelevant, incomplete or not construed in the light most favorable to the plaintiff, as the Court must do in adjudicating a defendant's motion for summary judgment. These criticisms are largely directed at observations which are not central to the dispute in counts I or II of the amended complaint. The claim that certain recitals are incomplete is also accompanied by the observation that there are witnesses yet to depose and that this Court ordered the depositions postponed until the summary judgment motions have been adjudicated. The discovery period established by the Case Management and Scheduling Order has elapsed, and the Court ordered that the plaintiffs request to take these depositions, which were identified as "trial depositions," should abide the decision on the dispositive motions, which may render that request moot. Nonetheless, with these objections in mind, the Court will summarize the facts which are stated in more detail in the first twenty-seven pages of the Report and Recommendation.

The plaintiff is a general surgeon who, between 1976 and 2001, exercised staff privileges at the Hills & Dales General Hospital located in Cass City, Michigan. During that time, the plaintiff was elected chief of the medical staff on three occasions; however, he often found himself embroiled in disputes with staff members and employees. Complaints to hospital administrators were lodged against the plaintiff, and the plaintiff likewise complained to hospital administrators regarding the conduct of staff members and employees. There are memoranda from this era to the plaintiff from then-hospital administrator Ken Jensen upbraiding the plaintiff for his abusive treatment of the nursing staff. The criticisms of the plaintiffs management and interpersonal relationship skills, however, did not prevent hospital officials from negotiating agreements with the plaintiff to purchase real estate, and the future arrangements to buy his medical practice at issue in this case. Nonetheless, the reports of conflicts between the plaintiff and other hospital personnel led the magistrate judge to conclude justifiably that Hills & Dales General was not a "happy hospital."

As noted above, in the 1980s, the plaintiff negotiated with hospital representatives to purchase land next to the hospital so he could construct a medical clinic. The plaintiff eventually purchased the land at a reduced price and constructed the clinic. The plaintiff alleges that the hospital verbally agreed to purchase the clinic and the plaintiffs surgical practice upon the plaintiffs death, disability or retirement. Ultimately, the hospital purchased the clinic, but not the plaintiffs practice.

In 1994, Ken Jensen was replaced by defendant Denise McKrow as the hospital administrator. The plaintiff, a member of the hospital board during this time, opposed the hiring of McKrow. The plaintiff and McKrow frequently clashed over a variety of staffing, personnel and administrative issues during McKrow's tenure as the hospital administrator. For example, the plaintiff complained that McKrow had hired a Dr. Jeffrey McErlean as an emergency room physician, despite the fact that this doctor had been relieved of surgical privileges at a hospital in Dearborn, Michigan because of patient safety concerns. The plaintiff also asserted that McKrow hired McErlean because McKrow wanted more Caucasian physicians. The majority of the 14 member medical staff were non-Caucasians. The plaintiff further complained about a Dr. Scott Placeway, an anesthesiologist whom McKrow had hired. The plaintiff asserted that Dr. Placeway was unacceptable and refused to use his services for the plaintiffs surgeries. The plaintiff also complained that Dr. Placeway committed medicare billing fraud.

In 1999, partly as a result of the plaintiffs complaints, defendant Roger Marshall, the president of the hospital board of trustees, hired Dr. Charles Carroll, a general surgeon from Wisconsin, to investigate the hospital. In his report to the hospital board, Dr. Carroll states that it was his sense that the hospital "administration was out to get" the plaintiff and were using "potential quality issues ... to embarrass and undermine [the] credibility of Dr. Jeung." Pl.'s Ex. H at 4. At one point in the report, Dr. Carroll remarked about the "cultural differences" between Hills & Dales Hospital and the Pigeon Hospital he visited for comparison, and the plaintiff seized on this comment as evidence of a racial or ethnic rift. However, viewing Dr. Carroll's report in its entirety dispels that inference; earlier in the report he used the same term, noting that "[t]he culture of performance improvement must be institutionalized...." Ibid. He did not refer to "culture" as a means of describing a failure at Hills & Dales Hospital to accord non-Caucasian hospital staff and personnel "the same right ... to make and enforce contracts ... and to the full and equal benefit of all laws ... as is enjoyed by white citizens." See 42 U.S.C. § 1981. Dr. Carroll closed his report by stating his hope that his recommendations would "assist you in making some productive improvements in a hospital that certainly has many high quality attributes." Id. at 5. The plaintiff asserts that this report is the most important exhibit in this case.

After receipt of Dr. Carroll's report and after receiving a letter from the plaintiffs attorney regarding the plaintiffs concerns about how he was being treated, the hospital executive committee met with McKrow, Placeway and the plaintiff in an attempt to resolve the issues.

In December 1999, the hospital hired Dr. Garth Murray, a general surgeon, as a hospital employee, rather than as a private physician with staff privileges, like the plaintiff. The plaintiff alleges that the hospital thus realizes greater revenue from the surgeries performed by Dr. Murray than from the surgeries performed by the plaintiff.

In October 2000, a patient complained directly to McKrow concerning a potential unnecessary surgery performed by the plaintiff. Shortly thereafter, another physician wrote the hospital and expressed concern over unnecessary surgeries performed by the plaintiff. The complaints were forwarded to the hospital's medical executive committee and the matters were eventually closed without an investigation. However, in December of that same year, Dr. Murray complained to McKrow about the plaintiff pressuring a member of the medical staff to undergo surgery by the plaintiff instead of Dr. Murray, labeling this conduct as "unethical." McKrow received another complaint about the plaintiff from a Dr. Girgis, who also had complained earlier that year after the...

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    ...of the “hostile treatment” modification utilized in commercial establishment claims, citing as authority Jeung v. McKrow, 264 F.Supp.2d 557, 567–68 (E.D.Mich.2003), a case brought pursuant to 42 U.S.C. § 1981. Jeung, however, was not purely a revocation of privileges case; rather it had the......
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    • December 3, 2004 not transformed into a state actor by virtue of receiving federal and state funding and tax-exempt status. See Jeung v. McKrow, 264 F.Supp.2d 557, 571 (E.D.Mich.2003) (dismissing § 1983 claim because "private hospitals operating as not-for-profit entities under the Internal Revenue Code ......
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    ...have engaged in extensive discovery does not bar this Court from declining to adjudicate state-law claims. See Jeung v. McKrow , 264 F.Supp.2d 557 (E.D. Mich. 2003) ; Practice Perfect, Inc. v. Hamilton Cty. Pharm. Ass'n , 732 F.Supp. 798 (S.D. Ohio 1989). In declining to exercise supplement......
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