Nath v. Texas Children's Hosp.
| Decision Date | 26 June 2012 |
| Docket Number | NO. 14-11-00127-CV,NO. 14-11-00034-CV,14-11-00034-CV,14-11-00127-CV |
| Parties | RAHUL K. NATH, M.D., Appellant v. TEXAS CHILDREN'S HOSPITAL, Appellee RAHUL K. NATH, M.D., Appellant v. BAYLOR COLLEGE OF MEDICINE, Appellee |
| Court | Texas Court of Appeals |
Opinion of May 3, 2012 Withdrawn, Motion for Rehearing Overruled, Affirmed and Substitute Opinion filed June 26, 2012.
We overrule the motion for rehearing filed by Rahul K. Nath, M.D. in these cases. We withdraw our opinion issued May 13, 2012, and we issue the following substitute opinion in its place.
These are consolidated appeals of two judgments awarding appellees Texas Children's Hospital ("TCH") and Baylor College of Medicine ("Baylor") attorney's fees as sanctions. Appellant Rahul K. Nath, M.D. challenges the sanctions awards on several grounds. In both cases, Nath asserts that the trial court abused its discretion in granting the sanctions because (a) the sanctionable conduct was that of Nath's attorneys, rather than Nath; (b) the motions for sanctions were filed after the trial of the case; (c) the procedural safeguards of Chapter 41 of the Texas Civil Practice and Remedies Code were not provided; and (d) the sanctions were excessive under the circumstances. In the Baylor appeal only, Nath brings two additional issues: (1) the trial court abused its discretion in awarding Baylor its attorney's fees as sanctions because Texas Rule of Civil Procedure 13 and Texas Civil Practice and Remedies Code Chapter 10 are unconstitutionally vague; and (2) the award of $644,500.16 in sanctions to Baylor violates the Excessive Fines clauses of the federal and state constitutions. We affirm.
Nath is a board-certified plastic surgeon specializing in surgical treatment of brachial plexus injuries, which are injuries to the nerves of children occurring during birth. In February 2006, Nath sued Baylor and TCH (under vicarious liability theories), and Dr. Saleh Shenaq for tortious interference with prospective business relations and defamation based on statements allegedly made by Shenaq. These allegedly defamatory statements asserted that Nath (a) was fired from Baylor, (b) performed unnecessary surgeries, (c) was unqualified, (d) was under criminal investigation, and (e) lacked professional ethics and integrity. Nath amended his petition in April 2006, adding two out-of-state defendants, reasserting the same allegations.
He again amended his petition in August 2006 after the out-of-state defendants filed special exceptions, providing more details regarding their acts, but keeping the same claims against all the defendants: defamation and tortious interference. The out-of-state defendants also filed special appearances, which the trial court denied. However, these special appearances were reversed on appeal. Nath's dispute with Shenaq was resolved by an agreed order of dismissal with prejudice.
Nath amended his petition again in September 20081 to include claims for tortious interference, defamation, negligent supervision, and negligent training against Baylor and TCH only. In this petition, Nath reurged his previous defamation complaints and added that Shenaq and various other Baylor and TCH employees made false and misleading statements to the effect that Nath had left TCH without notice and had disappeared from TCH without leaving a forwarding address.
Nath filed a fourth amended petition in November 2008, alleging the same claims against the same defendants. In this petition, he made the allegations detailed above, as well as alleging that further defamatory statements had been made by specific individuals employed by Baylor or TCH. Nath also detailed several specific examples of alleged tortious interference. He contended that the basis for the "defamation campaign" pursued by TCH and Baylor was dissatisfaction of doctors in the Baylor Obstetrics/Gynecology department concerning Nath's testimony in lawsuits filed against them. He additionally alleged that TCH and Baylor were further motivated to discredit him, damage his reputation, and remove him from their facilities because Nath had discovered that even though Shenaq had become partially or completely blind in one eye after suffering a detached retina in 2003, Shenaq continued to perform surgeries.
In July 2009, Nath filed his fifth amended petition against Baylor and TCH, adding claims for a declaratory judgment and seeking injunctive relief. His claims for a declaratory judgment and injunctive relief were based on his allegations that he had"become increasingly concerned with the question of whether he ha[d] a duty, as a fiduciary to his current patients, to make any disclosures to them if, in fact, he confirmed that Dr. Shenaq's eyesight [had been] impaired during these surgeries." He further alleged that Shenaq had some type of hepatitis, which would have been "an absolute contraindication to his performing surgery." He stated that when he had sought discovery of information to reveal when Shenaq contracted hepatitis, what form of hepatitis Shenaq had, and whether the disease was active, Baylor and TCH had blocked him from obtaining this information. He sought the following declarations:
Plaintiff seeks this Court's declaration of his rights, interests, and duties with respect to Dr. Nath's Current Affected Patients and any other of the Eyesight Affected Patients and Possible Hepatitis Affected Patients [operated on by Dr. Shenaq] that are identified to be his current patients. Plaintiff further seeks this Court's declaration of the duties of Baylor and TCH with respect to the Eyesight Affected Patients and Possible Hepatitis Affected Patients. Specifically, Plaintiff seeks this Court's declaration that the information sought by Plaintiff in discovery in this lawsuit is information to which he is entitled and that is necessary for him to understand and fulfill his duties to his current patients as well as a ruling from the Court, after the information is fully disclosed, conforming the extent of disclosure that should be made to his current patients. Plaintiff further seeks this Court's declarations as to Baylor's and TCH's specific duties of disclosure to the Eyesight Affected Patients and Possible Hepatitis Affected Patients as revealed by the discovery and determined by this Court.
His requested injunctive relief was based on his declaratory judgment claim.
In December 2009, TCH a filed a traditional and no-evidence summary-judgment motion addressing all of Nath's claims. Baylor filed a similar motion on January 4, 2010. Nath responded to TCH's summary-judgment motion in March 2010. An affidavit signed by Nath was attached as an exhibit to this response. In this affidavit, Nath repeats and expands upon the factual allegations underlying his fifth amended petition, as well as identifying several of the legal claims asserted in his petition. On April 1, 2010, when themotions for summary judgment were set to be argued, Nath sought recusal of the trial court judge.2
On April 14, 2010, Nath filed an amended petition in which he abandoned all his previous claims and substituted a claim for intentional infliction of emotional distress ("IIED"). In May 2004, TCH and Baylor supplemented their summary-judgment motions to address this claim. TCH's summary-judgment motion was granted on June 18, 2010, but its counterclaims remained pending against Nath. Baylor's summary-judgment motion was likewise granted. TCH nonsuited its counterclaims against Nath on August 12, 2010. The trial court signed an order on August 17, 2010, stating that the previously granted summary judgments became final and appealable on August 12, 2010, the date of TCH's non-suit.
On August 26, 2010, TCH filed a motion to modify the judgment to assess its attorney's fees as sanctions against Nath pursuant to Texas Rule of Civil Procedure 13 ("Rule 13") and Chapter 10 of the Texas Civil Practice and Remedies Code ("Chapter 10"):
[TCH] prays that the Court grant its Motion to Modify the Judgment to Assess Fees as Sanctions Against Plaintiff Rahul K. Nath and impose monetary sanctions against Nath under Chapter 10 and/or Rule 13 based on the filing of the intentional infliction of emotional distress claim; the defamation, tortious interference, and negligence claims, and the declaratory judgment claim.
(emphasis added). The trial court heard the motion for sanctions on September 17, 2010. Without objection by Nath's attorney, the trial court took judicial notice of the court's file, including the motions for summary judgment, the attachments to the motions, and the motion for sanctions with attachments. Nath did not appear or present any evidence at this hearing, although he was not subpoenaed to attend. That same day, the trial court granted TCH's motion to modify the judgment and assess fees as sanctions against Nath. The trial court specifically found that Nath's claims were groundless, that a reasonableinquiry would have revealed that these claims were without factual basis and barred by well-settled, existing Texas law, and that they were filed in bad faith and for an improper purpose. The trial court ordered Nath to pay TCH's attorney's fees in the amount of $726,000, concluding that this amount adequately punished Nath and fairly compensated TCH for defending against the claims. On November 8, 2010, the trial court additionally entered lengthy findings of fact and conclusions of law in support of the sanctions. These findings and conclusions are attached to this opinion in Appendix A.
On September 10, 2010, the trial court severed Nath's proceedings against Baylor from the main case, in which TCH's motion to modify the judgment was still pending. On September 15, 2010, Nath filed a motion for new trial in the severed Baylor case. On September 21, 2010, Nath filed a notice of withdrawal of his motion for new trial in the Baylor...
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