Khoiny v. Dignity Health

• Decision Date: 16 March 2022
• Docket Number: B301486
• Citation: 76 Cal.App.5th 390,291 Cal.Rptr.3d 496
• Parties: Noushin KHOINY, Plaintiff and Appellant, v. DIGNITY HEALTH, Defendant and Respondent.
• Court: California Court of Appeals Court of Appeals

76 Cal.App.5th 390

291 Cal.Rptr.3d 496

Noushin KHOINY, Plaintiff and Appellant,

v.DIGNITY HEALTH, Defendant and Respondent.

B301486

Court of Appeal, Second District, Division 8, California.

Filed March 16, 2022

Makovoz Law Group and Ilana Makovoz, Santa Monica, for Plaintiff and Appellant.

Ballard Rosenberg Golper & Savitt, Linda Miller Savitt, Eric C. Schwettmann and John J. Manier, Glendale, for Defendants and Respondents.

STRATTON, J.

INTRODUCTION

This case presents an issue of first impression under California law: whether a medical resident's claim that she was dismissed from her residency program due to gender discrimination and in retaliation for complaints about discrimination and workplace safety is subject to the rule of academic deference. We hold the predominant relationship between a medical resident and a hospital residency program is an employee-employer relationship, and so academic deference does not apply to the jury's determination whether the resident was terminated for discriminatory or retaliatory reasons. The jury in this case returned a verdict in favor of respondent Dignity Health, doing business as St. Mary Medical Center (SMMC), after being improperly instructed that SMMC's decision to terminate Dr. Noushin Khoiny (appellant) was entitled to academic deference in the first instance. Dr. Khoiny presented credible evidence of gender discrimination and retaliation by SMMC, and there is a reasonable probability that, in the absence of the erroneous jury instruction, she would have obtained a more favorable verdict. We reverse the judgment and remand for a new trial.

BACKGROUND

From June 24, 2012 to August 11, 2014, Dr. Khoiny was a paid resident in the internal medicine program at SMMC in Long Beach, California. After completing the second year of the three-year program, Dr. Khoiny was dismissed from the program. On March 11, 2015, Dr. Khoiny filed a complaint against SMMC alleging her dismissal was retaliatory and based on gender discrimination. On November 5, 2015, she filed the operative second amended complaint which included causes of action for gender discrimination, retaliation for reporting gender discrimination, and failure to prevent gender discrimination or retaliation in violation of Fair Employment and Housing Act ( Gov. Code, § 12940 ); whistleblower retaliation in violation of Health and Safety Code section 1278.5 ; and whistleblower retaliation for reporting unsafe workplace conditions in violation of Labor Code section 6310. The complaint included other causes of action not at issue in this appeal.

Trial by jury began in 2018. The trial court declared a mistrial after the jury could not reach a verdict.

The second trial began in 2019. The court instructed the jury with Special Instruction SI 28 (SI 28) which the trial court described as "dealing with academic deference." That instruction read:

"Since St. Mary's residency program was academic in nature, St. Mary's academic judgment should not be overturned unless it is found to have been arbitrary and capricious, not based on academic criteria, or motivated by bad faith, or ill will, or motivated by retaliation or discriminatory reasons unrelated to her academic performance.

"You must uphold the decision of St. Mary Medical Center unless you find its decision was a substantial departure from accepted academic norms as to demonstrate that the person or committee did not actually exercise professional judgment."

The court also gave the jury a special verdict form. The first question, entitled "ACADEMIC DEFERENCE," asked: "Do you find that Dignity Health dba St. Mary Medical Center's termination of Dr. Khoiny's employment was arbitrary and capricious, not based on academic criteria, or motivated by bad faith or ill will, or motivated by retaliation or discriminatory reasons unrelated to academic performance?" If the jury answered "No," it was directed to skip to the end of the 13-page special verdict form and sign it. The jury answered, "No."

DISCUSSION

I. The Trial Court Erroneously Applied Academic Deference to Appellant's Claims.

We begin by noting the elements of and analysis required in California for claims of gender discrimination and retaliation under the Fair Employment and Housing Act (FEHA). ( Gov. Code, § 12900 et seq. ) To establish a prima facie case of retaliation under FEHA a plaintiff must show they engaged in "protected activity"; the employer subjected the employee to an adverse employment action; and a causal link existed between the protected activity and the employer's action. ( Yanowitz v. L'Oreal, Inc. (2005) 36 Cal.4th 1028, 1042, 32 Cal.Rptr.3d 436, 116 P.3d 1123 ( Yanowitz ).) To establish a prima facie case of discrimination under FEHA, a plaintiff must show they were a member of a protected class; they were qualified for the position or were performing competently in the position they held; they suffered an adverse employment action, such as termination, demotion, or denial of an available job; and some other circumstance suggested discriminatory motive. ( Guz v. Bechtel National, Inc. (2000) 24 Cal.4th 317, 355, 100 Cal.Rptr.2d 352, 8 P.3d 1089 ( Guz ).) Once a plaintiff establishes a prima face case, the employer is required to offer a legitimate, nonretaliatory reason for the adverse employment action. If the employer produces a legitimate reason for the adverse employment action, the presumption of retaliation and discrimination "drops out of the picture," and the burden shifts back to the employee to prove intentional retaliation or discrimination. This is the three-part burden shifting analysis of McDonnell Douglas Corp. v. Green (1973) 411 U.S. 792, 802–805, 93 S.Ct. 1817, 36 L.Ed.2d 668 employed in Title VII cases and adopted by California for use in FEHA cases. ( Yanowitz, at p. 1042, 32 Cal.Rptr.3d 436, 116 P.3d 1123 ; Guz, at pp. 354–356, 100 Cal.Rptr.2d 352, 8 P.3d 1089.) This test reflects the principle that direct evidence of intentional discrimination is rare, and that such claims must usually be proved circumstantially. Thus, by successive steps of increasingly narrow focus, the test allows discrimination to be inferred from facts that create a reasonable likelihood of bias and are not satisfactorily explained. ( Guz, at pp. 354, 100 Cal.Rptr.2d 352, 8 P.3d 1089.)

In contrast to the burden-shifting analysis adopted for FEHA claims in California is the rule of academic deference, which the First District Court of Appeal summarized 25 years ago: "It is well settled that in actions challenging the academic decision of a private university regarding a student's qualifications for a degree, we exercise a highly deferential and limited standard of review. ‘There is a widely accepted rule of judicial nonintervention into the academic affairs of schools.’ ( Paulsen v. Golden Gate University (1979) 25 Cal.3d 803, 808 [159 Cal.Rptr. 858, 602 P.2d 778] ( Paulsen ).) We may only overturn the university's decision if we find it to be arbitrary and capricious, not based upon academic criteria, and the result of irrelevant or discriminatory factors. ( Id. at pp. 808–809, 159 Cal.Rptr. 858, 602 P.2d 778 ; accord, Wong v. Regents of University of California (1971) 15 Cal.App.3d 823, 830 .) We must uphold the university's decision ‘unless it is such a substantial departure from accepted academic norms as to demonstrate that the person or committee responsible did not actually exercise professional judgment.’ ( Regents of University of Michigan v. Ewing (1985) 474 U.S. 214, 225 [106 S.Ct. 507, 88 L.Ed.2d 523, 532] ( Ewing ).)" ( Banks v. Dominican College (1995) 35 Cal.App.4th 1545, 1551, 42 Cal.Rptr.2d 110 ( Banks ).) It is this doctrine of academic deference which the trial court erroneously applied to Dr. Khoiny's claims of gender discrimination and retaliation.

In their briefing the parties have cited five California cases and one United States Supreme Court case involving academic deference: Banks , supra , 35 Cal.App.4th 1545, 42 Cal.Rptr.2d 110 ; Paulsen , supra , 25 Cal.3d 803, 159 Cal.Rptr. 858, 602 P.2d 778 ; Wong v. Regents of University of California , supra , 15 Cal.App.3d 823, 93 Cal.Rptr. 502 ; Shuffer v. Board of Trustees (1977) 67 Cal.App.3d 208, 136 Cal.Rptr. 527 ; Lachtman v. Regents of University of California (2007) 158 Cal.App.4th 187, 70 Cal.Rptr.3d 147 ; and Ewing , supra , 474 U.S. 214, 106 S.Ct. 507. Plaintiffs in these cases were all students enrolled in traditional academic institutions: colleges, universities or graduate schools. Nothing in these opinions suggests any student received financial compensation for services rendered in connection with the academic programs. No student brought a FEHA claim, which has as a " ‘fundamental foundation for liability’ ... ‘ "existence of an employment relationship" ’ between the parties." ( McCoy v. Pacific Maritime Assn. (2013) 216 Cal.App.4th 283, 301, 156 Cal.Rptr.3d 851.)

Several of these cases, and other federal cases as well, apply the academic deference rule to medical students participating in clinical rotations, but a medical student is not similarly situated to a medical resident. On a very broad level, medical students are very similar to traditional students: they are enrolled in and pay tuition to a university or college for the purpose of obtaining an academic medical degree while receiving limited hands-on clinical experience.

On the other hand, medical residents have graduated from medical school and are being paid ordinary taxable income to provide medical services to a hospital or medical center while also receiving clinical training; much of the service they provide is indistinguishable from that provided by fully licensed physicians. A medical residency program within a hospital or medical center is not a traditional academic institution with predominantly traditional student activities. The Cambridge Dictionary, for example, defines "academic" as "relating to schools, colleges, and universities, or connected with...