Kaczanowski v. Medical Center Hosp. of Vermont

• Decision Date: 19 June 1985
• Docket Number: Civ. A. No. 81-336.
• Court: U.S. District Court — District of Vermont
• Parties: Carl H. KACZANOWSKI, D.P.M. and Michael J. Guerra, D.P.M., individually and on Behalf of their patients v. MEDICAL CENTER HOSPITAL OF VERMONT, Fanny Allen Hospital, Hotel Dieu.

612 F. Supp. 688

Carl H. KACZANOWSKI, D.P.M. and Michael J. Guerra, D.P.M., individually and on Behalf of their patients v. MEDICAL CENTER HOSPITAL OF VERMONT, Fanny Allen Hospital, Hotel Dieu.

Civ. A. No. 81-336.

United States District Court, D. Vermont.

June 19, 1985.

Robert A. Mello, South Burlington, Vt., for plaintiffs.

Spencer R. Knapp, Dinse, Erdmann & Clapp, Burlington, Vt., for Medical Center Hosp. of Vermont.

Richard Wadhams, Pierson, Affolter & Wadhams, Burlington, Vt., for Fanny Allen Hosp., Hotel Dieu.

MEMORANDUM OF DECISION

HOLDEN, Senior District Judge.

The plaintiffs Carl H. Kaczanowski, D.P.M., and Michael J. Guerra, D.P.M., seek injunctive and compensatory relief arising from denial of staff privileges by the defendants Medical Center Hospital of Vermont ("MCHV") and the Fanny Allen Hospital, Hotel Dieu ("FAH.") The action was jointly instituted by the plaintiffs individually and on behalf of their patients. The United States Magistrate was designated by the court to hear and submit his recommendation for disposition of pretrial motions pursuant to 28 U.S.C. § 636(b)(1). The designation included the defendants' motions for summary judgment.

The facts which compose this action are thoroughly explored and reported by the magistrate. Briefly stated, the magistrate concluded that except for Counts IV and V, charging violations of 42 U.S.C. §§ 1985 and 1986, the record in its entirety presents affirmative issues for proof that preclude granting the defendants' motions for summary judgment. The defendants' objections to this recommendation bring the case on for this court's review.

FACTUAL BACKGROUND¹

Plaintiffs Carl H. Kaczanowski, D.P.M., and Michael J. Guerra, D.P.M., are podiatrists licensed by the State of Vermont to practice their profession pursuant to 26 V.S.A. §§ 321 et seq. They practice together as the "Vermont Foot Clinic" in Burlington and the "Central Vermont Foot Clinic" in Berlin. Both plaintiffs have been admitted as members of the Central Vermont Medical Center ("CVMC") medical staff, with privileges to perform limited foot surgery at that facility. CVMC is in Washington County and adjoins Chittenden.

MCHV and FAH are both located in Chittenden County. They are the only hospitals in that area. FAH is a private hospital. MCHV is a non-profit hospital medical treatment facility and serves as the primary teaching hospital for the University of Vermont College of Medicine.

Doctors Kaczanowski and Guerra applied to MCHV and FAH to obtain admitting and podiatric surgical privileges as members of the medical staffs of both defendants. Their applications were denied. Plaintiffs claim MCHV and FAH unlawfully forbid them medical staff privileges.

Dr. Kaczanowski sought staff and admitting authority at MCHV in early September 1977. The chairman of the MCHV department of surgery, John Davis, M.D., recommended only limited approval of the application. Specifically, Dr. Davis recommended "Scientific Consultant" status without surgical or admitting privileges. The MCHV medical staff executive committee approved Dr. Davis' recommendation on November 2, 1978. The full medical staff adopted the recommendation on December 6, 1978. The MCHV Board of Trustees accepted the medical staff's decision on January 18, 1979. MCHV gave its decision to Dr. Kaczanowski on January 22, 1979.

Dr. Guerra initiated his application to MCHV in mid-June 1979. Dr. Davis noted his recommendation on Dr. Guerra's application on June 27, 1979. Dr. Davis recommended the same status granted to Dr. Kaczanowski, Scientific Consultant, without privileges to admit or perform surgery. Dr. Guerra never completed his application by submitting three letters of recommendation as required. MCHV did not take further or final action on his application.

Drs. Kaczanowski and Guerra applied to FAH in June 1979. FAH's chief of surgery, Clarence Bunker, M.D., discussed the applications informally with other members of the medical staff who objected to granting plaintiffs any privileges which would overlap the area of the orthopedic surgeons. Dr. Bunker and the surgeons he consulted agreed that plaintiffs should only be allowed to perform soft tissue foot surgery; surgery requiring the cutting of bone was reserved to the orthopedic surgeons.

After consultations with the FAH administrator and the plaintiffs, Dr. Bunker made a formal recommendation to the Fanny Allen Medical Executive Committee. The recommendation would allow plaintiffs to perform soft tissue foot surgery on an outpatient basis. It would restrict the plaintiffs to consulting with attending physicians on inpatient admissions. The committee adopted Dr. Bunker's recommendation.

The plaintiffs, Dr. Kaczanowski and Dr. Guerra, objected to the restrictions on their privileges at FAH. They met with Dr. Bunker and the Medical Executive Committee on June 20, 1980. Dr. Bunker and the committee agreed to reconsider their initial decision in light of the plaintiffs' privileges at CVMC. The FAH Medical Executive Committee later met with the new chief of surgery, Donald Majercik, M.D., on November 21, 1980. Rather than enlarging the privileges, the committee, on Dr. Majercik's recommendation, restricted the privileges previously granted to plaintiffs at FAH. The privileges, as thus curtailed, were limited in the same fashion as those granted at MCHV. The Fanny Allen Medical Staff and Board of Trustees ratified the committee's decision. FAH notified Drs. Kaczanowski and Guerra on January 6, 1981. Plaintiffs commenced this action on October 29, 1981. Extensive discovery ensued, followed by hearings by the magistrate and the district court on defendants' motions for summary judgment.

THE CLAIMS

The Doctors Kaczanowski and Guerra allege the actions of MCHV and FAH violated the federal antitrust law and their civil rights as protected by the United States Constitution. It is further alleged that the conduct of the defendants offends the Constitution of Vermont and the Vermont statutory and common law.

In summary, Drs. Kaczanowski and Guerra allege both MCHV and FAH based their decisions to deny the applications to practice podiatry to the extent permitted by state law on agreements and acts designed, as a practical matter, to exclude podiatrists from hospital practice. Count I of the complaint alleges unreasonable and substantial trade restraints which violate Section 1 of the Sherman Act. 15 U.S.C. § 1. Count II charges conspiracy and attempt to monopolize in violation of Section 2 of the Sherman Act. 15 U.S.C. § 2.

Count III relies on 42 U.S.C. § 1983 to charge that MCHV and FAH violated constitutional rights protected by the Due Process Clause by depriving the plaintiffs of the privileges sought in their applications. Count IV alleges MCHV and FAH conspired with others to deprive plaintiffs of equal protection and equal privileges and immunities under the laws of the United States, in violation of 42 U.S.C. § 1985(3) and § 1986. In Counts VI—XIV Drs. Kaczanowski and Guerra assert multiple pendent state claims.

DISCUSSION

At the outset, the court is mindful that summary adjudication of antitrust claims is generally disfavored. The Supreme Court has cautioned that motive and intent usually are involved in antitrust litigation, hence summary procedures should be sparingly applied. Poller v. Columbia Broadcasting System, Inc., 368 U.S. 464, 473, 82 S.Ct. 486, 491, 7 L.Ed.2d 458 (1962). With these standards in mind, the court turns to the central issues that are presented in the extensive record accumulated since the commencement of the action.

Exhaustion of Remedies

Both FAH and MCHV challenge the Magistrate's recommendation that the court adjudicate the merits of the complaint rather than defer to the internal procedures in the hospital administrative structures. The defendants join in urging that judicial relief be withheld until both plaintiffs have exhausted the remedies afforded by the hospital staffs. The court finds no merit in these contentions. There is no statutory mandate that the plaintiffs exhaust the hospitals' internal appeals. Nor was there any undertaking expressed or implied between plaintiffs and the hospitals which would impose such a requirement.

Indeed the plaintiffs come to this court seeking both equitable and compensatory relief. There is no suggestion that the relief sought is available from the hospitals. Absent some statutory or other directive, the court declines to stay its review to await further administrative action that may prove to be burdensome and unproductive. The court approves that aspect of the Magistrate's report that recommends against imposing an exhaustion requirement in the present state of this controversy. That takes us to the jurisdictional base for Sherman Act violations.

Sherman Act Claims

Plaintiffs plead that the defendants violated Sections 1 and 2 of the Sherman Act. Section 1 makes "every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States ..." illegal. 15 U.S.C. § 1. Section 2 provides that "every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States ..." acts illegally. 15 U.S.C. § 2.

Since the defendants' alleged wrongful activities are local in nature, the court's attention of necessity turns to the question of whether the record establishes that the defendants' antitrust activity exerted an adverse effect on interstate commerce. The report of the Magistrate concluded in the affirmative.

In the present pretrial posture of the case and in the context of the pending motion for summary judgment the court is inclined to agree. That is not to say that the link between the defendants' denial of staff privileges to the plaintiff and the adverse effect on commerce is clear and strong. Rather the linkage...