Martin v. Memorial Hosp. at Gulfport

• Decision Date: 30 December 1997
• Docket Number: No. 97-60254,97-60254
• Parties: 1997-2 Trade Cases P 72,007 James P. MARTIN, Plaintiff-Appellant, v. MEMORIAL HOSPITAL AT GULFPORT, Wray Anderson, Mitchell Salloum, Edward Reid, and Myrtis Franke, Defendants-Appellees. Summary Calendar.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 1143

130 F.3d 1143

1997-2 Trade Cases P 72,007

James P. MARTIN, Plaintiff-Appellant, v. MEMORIAL HOSPITAL AT GULFPORT, Wray Anderson, Mitchell Salloum, Edward Reid, and Myrtis Franke Defendants-Appellees.

No. 97-60254

Summary Calendar.

United States Court of Appeals Fifth Circuit.

Dec. 30, 1997.

Larry D. Moffett, Daniel, Coker, Horton & Bell, Oxford, MS, James Anthony Keith, Long Beach, MS, for Plaintiff-Appellant.

Neville Henry Boschert, Cory Todd Wilson, Watkins, Ludlam & Stennis, Jackson, MS, Robert C. Galloway, Galloway & Galloway, Gulfport, MS, William M. Rainey, Franke, Rainey and Salloum, Gulfport, MS, for Defendants-Appellees.

Appeal from the United States District Court for the Southern District of Mississippi.

Before JOLLY, BENAVIDES and PARKER, Circuit Judges.

ROBERT M. PARKER, Circuit Judge:

I.

FACTS & PROCEDURAL HISTORY

For the second time this case has found its way to this Court on appeal. ¹ The appellant Dr. James P. Martin brought this action challenging a certain monopoly created over the provision of out-patient, kidney dialysis in Harrison County, Mississippi. Mississippi law prohibits the operation of an End Stage Renal Disease ("ESRD") Unit without first obtaining a certificate of need from the state department of health. Two certificates of need were issued for ESRD units in Harrison County. MHG acquired control of those units from Singing River Hospital System and began offering out-patient kidney dialysis in 1981. Thereafter, MHG entered into an exclusive medical director contract with Dr. Douglas Lanier, whereby only Dr. Lanier or his designated representative could perform chronic, out-patient dialysis in the hospital's ESRD units. In 1986, Dr. Martin, a nephrologist, was successfully recruited by MHG and Dr. Lanier, and he became associated In November, 1988, Dr. Lanier and Dr. Martin separated their practices. Thereafter, in March, 1989, Dr. Martin attempted to admit a patient for chronic, out-patient, kidney dialysis at MHG's ESRD unit. MHG refused to allow Dr. Martin to perform the dialysis based on its exclusive contract with Dr. Lanier. Dr. Martin then wrote the MHG board of trustees asserting his alleged right to render dialysis to his patients at MHG's ESRD unit. On June 26, 1989, MHG's board of trustees considered the question of Dr. Martin's access to its ESRD unit. The board passed a resolution reaffirming the exclusive medical director contract with Dr. Lanier and interpreting that contract to mean that only a physician in practice with and under the supervision and control of Dr. Lanier could perform chronic, out-patient, kidney dialysis in the hospital's ESRD units. In November, 1990, Dr. Martin's medical staff privileges at MHG were renewed with the exception of the privilege of providing chronic, out-patient dialysis in the ESRD unit. Therefore, Dr. Martin retained the authority to admit patients to the hospital and perform in-patient dialysis, but he must refer patients to the medical supervisor or his designated representative for out-patient dialysis at MHG's ESRD units.

with Dr. Lanier. Dr. Martin was granted full medical staff privileges at MHG and all of its clinics. It appears, however, that, even before being granted full medical privileges by MHG, Dr. Martin already had access to the hospital's ESRD units, because he was Dr. Lanier's designated representative under the exclusive medical director contract. This meant that Dr. Martin could treat his chronic dialysis patients in the hospital's ESRD units without having to refer them to Dr. Lanier for dialysis.

When the board passed this resolution, no certificates of need had been issued by the state department of health for any ESRD units in Harrison County aside from those owned and operated by MHG. Therefore, any nephrologist not associated with Dr. Lanier, had to refer his patients to Dr. Lanier for chronic, out-patient dialysis or send them to a clinic in another county, unless the nephrologist could obtain a certificate of need from the state department of health and start her/his own ESRD unit.

Faced with this dilemma, Dr. Martin filed suit in the district court in 1990 against MHG and its board of trustees alleging that they had violated federal antitrust laws, violated his constitutional due process rights, interfered with his contractual relationships with his patients, and violated Mississippi antitrust law. MHG and the board moved for summary judgment claiming: immunity from federal antitrust law under the state action doctrine; immunity from damages for anticompetitive conduct under the Local Government Antitrust Act, 15 U.S.C. §§ 34, 36; that Dr. Martin was not deprived of a property or liberty interest without due process of law; that they acted in accordance with Mississippi law and therefore did not violate Mississippi antitrust law; and that the board members are entitled to qualified immunity on Dr. Martin's constitutional due process and state law claims. The district court held that the defendants were immune from money damages but not from injunctive relief, attorney's fees and court costs under the Local Government Antitrust Act. 15 U.S.C. § 35. The district court rejected the defendants' claim of immunity from federal antitrust law under the state action doctrine. The district court rejected MHG's motion for summary judgment on Dr. Martin's due process claims, state law antitrust claims and tortious interference claims. However, the district court granted the individual board members' motion for summary judgment on Dr. Martin's due process claims and state law claims, based on their defense of qualified immunity.

MHG and the board members appealed assigning the following errors: the district court's refusal to grant summary judgment on the federal antitrust claims under the state action doctrine of Parker v. Brown, 317 U.S. 341, 63 S.Ct. 307, 87 L.Ed. 315 (1943); the district court's refusal to grant summary judgment on Dr. Martin's § 1983 due process claims and Dr. Martin's state antitrust and tortious interference claims. Dr. Martin cross-appealed challenging: the district court's grant of limited immunity under the Local Government Antitrust Act; the district court's holding that the individual board members enjoyed qualified immunity from Dr. Martin's constitutional due process claims and his state antitrust and tortious On remand, MHG filed a renewed motion for summary judgment on all remaining claims. ² The district court reversed itself and held that summary judgment was appropriate on the remaining claims against MHG. Dr. Martin takes this appeal asserting the following errors:

interference claims. This Court reversed the district court and held that MHG and the board members were shielded from federal antitrust law by the state action doctrine. Martin v. Memorial Hospital at Gulfport (Martin I), 86 F.3d 1391, 1398-1400 (5th Cir.1996). This Court did not reach any of the other issues decided by the district court, as they were interlocutory in nature. Id. at 1401.

1. The district court erred by granting summary judgment against Dr. Martin on his § 1983 due process claims against MHG;

2. The district court erred by holding that the individual board members enjoyed qualified immunity from Dr. Martin's constitutional due process claims;

3. The district court erred by holding that the individual board members were immune from Dr. Martin's state law claims.

4. The district court erred by granting summary judgment against Dr. Martin on his state law antitrust and tortious interference claims;

II.

STANDARD OF REVIEW

This Court reviews a district court decision to grant summary judgment de novo, applying the same standard as the district court. Wynn v. Washington National Insurance Company, 122 F.3d 266, 268 (5th Cir.1997), citing Bodenheimer v. PPG Indus., Inc., 5 F.3d 955, 956 (5th Cir.1993).

III.

LAW & ANALYSIS

A. Procedural Due Process

The due process clause provides a mechanism by which a persons property or liberty may not be permanently diminished or abrogated without first being accorded that procedural protection designed to ensure a principled and even-handed examination of the basis for any such deprivation. Cleveland Bd. of Educ. v. Loudermill, 470 U.S. 532, 542, 105 S.Ct. 1487, 1493, 84 L.Ed.2d 494 (1985); Board of Regents of State Colleges v. Roth, 408 U.S. 564, 569-70, 92 S.Ct. 2701, 2705, 33 L.Ed.2d 548 (1972); Perry v. Sindermann, 408 U.S. 593, 599, 92 S.Ct. 2694, 2698, 33 L.Ed.2d 570 (1972). By its own terms, the due process clause is not implicated unless an individual's property or liberty interests are threatened.

i. Property Interest

The district court correctly recognized that procedural due process is a positivist notion, designed to protect property interests, existing not by force of the due process clause itself, but established by reference to some independent source, such as state law or contract. Roth, supra, 408 U.S. at 577, 92 S.Ct. at 2709; Perry v. Sindermann, supra, 408 U.S. at 601, 92 S.Ct. at 2699. The extent to which an individual interest is a property interest protected by the due process clause must be determined by an examination of the source of the interest. In cases such as this, where the interest is created by some state law or contract, the limitations of the interest are determined by examination of the state law or contract. Loudermill, supra, 470 U.S. at 538, 105 S.Ct. at 1491, citing Roth, supra, 408 U.S. at 577, 92 S.Ct. at 2709, and Paul v. Davis, 424 U.S. 693, 709, 96 S.Ct. 1155, 1164, 47 L.Ed.2d 405 (1976).

Appellant has argued that the source of his property interest in continued access to MHG's ESRD units lies in MHG's extension to him of full medical staff privileges, when he became associated with Dr. Lanier. MHG's own by-laws require notice and a hearing before a physician's previously granted or extended medical staff privileges may be taken away. Therefore, if Appellant's However, Appellant...