Payne v. Anaheim Memorial Medical Center

• Decision Date: 31 May 2005
• Docket Number: No. G032799.,G032799.
• Citation: 30 Cal.Rptr.3d 230,130 Cal.App.4th 729
• Parties: David H. PAYNE, Plaintiff and Appellant, v. ANAHEIM MEMORIAL MEDICAL CENTER, INC., Defendant and Respondent.
• Court: California Court of Appeals Court of Appeals

30 Cal.Rptr.3d 230

130 Cal.App.4th 729

David H. PAYNE, Plaintiff and Appellant, v. ANAHEIM MEMORIAL MEDICAL CENTER, INC., Defendant and Respondent.

No. G032799.

Court of Appeal, Fourth District, Division 3.

May 31, 2005.

Rehearing Denied July 20, 2005.

Review Denied October 12, 2005.

Robert C. Moest for Plaintiff and Appellant.

McDermott Will & Emery, Richard J. Frey and Dan Chammas, for Defendant and Respondent.

OPINION

BEDSWORTH, Acting P.J.

The doctrine requiring exhaustion of internal remedies before resort to the courts is sound and wise — where such remedies are adequate. Sometimes, however, they are not. Where, as here, the "internal remedies" included no requirement of a hearing or formal resolution of the complaints raised, they cannot bar access to the courts.

Anaheim Memorial Medical Center, Inc. obtained a judgment on the pleadings against David Payne, M.D., on the basis his complaint was barred by his failure to exhaust administrative remedies contained in the hospital's medical staff bylaws. We conclude that the grievance procedure contained in Article X of the bylaws, which provided Payne with no right to a hearing and no opportunity to provide evidence, did not constitute an adequate "remedy" to resolve his complaint. Consequently, he was not required to "exhaust" that process prior to filing a lawsuit in court.

Additionally, we conclude Payne pleaded sufficient facts to state a valid cause of action pursuant to the Unruh Civil Rights Act (Civ.Code, § 51; UCRA). He specifically alleged that Anaheim Memorial operates the hospital as a business enterprise which offers its facilities to qualified physicians, who are not its employees, in exchange for fees and other considerations. The UCRA applies to prevent business entities from discriminating in the provision of their facilities on the basis of race, so Payne's allegation he was denied such access is properly cognizable under the UCRA Act. The judgment is reversed.

* * *

Because the judgment in this case follows a successful motion for judgment on the pleadings, we take our facts from the allegations of the complaint, which we assume to be true. (Leko v. Cornerstone Bldg. Inspection Service (2001) 86 Cal. App.4th 1109, 1114, 103 Cal.Rptr.2d 858.) Payne, an African-American, alleges that in August of 2000, certain members of Anaheim Memorial's surgical staff and other employees interfered with his treatment of an elderly Hispanic patient during a spinal surgery — exposing the patient to added surgical risk — for the purpose of demonstrating to him that he "was not welcome within the business environment of [the hospital]." When he later became concerned the patient had developed a dangerous complication, he requested that a myelogram be performed to assess the problem.

However, Dr. Neil Siegel, a radiologist with no experience in spinal surgery, refused to perform the myelogram, insisting it was unnecessary. Payne reminded Siegel that the hospital's radiology department had also refused to perform a myelogram on another of his Hispanic patients, and inquired whether the hospital had a policy of providing a lesser standard of care to its minority patients. Siegel responded "Only someone like you would think of something like that," which Payne understood to be a slur referencing his African-American heritage.

Payne reported the perceived slur to the chief of radiology, who dismissed it as "a mere personality conflict" and advised Payne he could take it up with the chief of the medical staff. Before Payne had a chance to do so, however, the chief of the medical staff ordered him to report to a "Physician Well-Being Committee" for the purpose of explaining his own alleged "unprofessional behavior in the operating room" and his "slander" of Siegel. According to the complaint, this was done for the purpose of covering up Siegel's racist comment and to prevent Payne from further inquiring into the quality of care the hospital afforded him or its patients.

Meanwhile, Payne continued to insist his patient receive a diagnostic test to assess her condition. A different radiologist finally performed a magnetic resonance imaging scan (MRI) of the patient's spine, which was then interpreted as showing the patient suffered from a "substantial dural leak," requiring immediate repair. Based upon that information from the radiology department, Payne took his patient back into surgery only, to discover no such leak actually existed. Had the more effective myelogram been performed, as Payne originally requested, the second surgery would have been avoided.

Despite the fact that Payne had neither performed, nor interpreted the result of, the MRI that purportedly evidenced the dural leak, Anaheim Memorial's "Medical Executive Committee" assigned responsibility for the unnecessary second surgery to Payne, rather than to the radiologist who had made the diagnosis. The complaint alleges that a "Surgical Ad-Hoc Committee" met in secret, without notice to Payne, and without affording him an opportunity to be heard, to evaluate the case.

Payne alleged that as a result of the committee's determination, his ability to practice medicine at another hospital was specifically restricted, when that hospital imposed a monitoring requirement upon him. He did not allege that any formal restrictions or conditions were placed upon his staff privileges at Anaheim Memorial itself.

Payne also alleged he had subsequent discussions with the chief of the medical staff, and his attorney communicated with Anaheim Memorial's attorney, concerning his allegations of racist conduct. Both were assured that a thorough and independent investigation would be conducted by an outside party, and that Payne would be given a copy of the investigator's findings. However, although the hospital had an attorney investigate the matter, Anaheim Memorial refused to deliver a copy of her report to Payne. Instead, it advised Payne that administrative proceedings would be "forthcoming." Despite that statement, nothing further was done; instead, according to the complaint, the incident was covered up.

After Payne filed this lawsuit, alleging causes of action for violation of the UCRA, and for emotional distress, Anaheim Memorial filed a motion for judgment on the pleadings, arguing Payne had failed to exhaust his administrative remedies under the medical staff bylaws and lacked standing to pursue a claim under the UCRA because he was not a "customer, client or patron" of the hospital.

Quoting from the preamble to its medical staff bylaws, Anaheim Memorial pointed out that they were intended to provide a "`framework for self-government for the organization of the Medical Staff of [Anaheim Memorial], that permits the Medical Staff to discharge its responsibilities in matters involving the quality of medical care, to govern the orderly resolution of issues and the conduct of Medical Staff functions supportive of those purposes.'" Anaheim Memorial then noted that under the bylaws, Payne had the right to initiate a complaint against any other physician he believed was acting in a fashion detrimental to patient safety, and that once he had done so, a committee of the medical staff would be charged with investigating the matter. Additionally, any physician had the right to an audience with the Medical Executive Committee, as well as an express duty to "actively participate in and regularly cooperate with the Medical Staff in assisting the Hospital to fulfill its obligations related to patient care."

According to Anaheim's argument, Payne failed to fully avail himself of the remedies available to him under the medical staff bylaws, and was thus precluded from asserting any claim for damages in court in accordance with the doctrine set forth in Westlake Community Hosp. v. Superior Court (1976) 17 Cal.3d 465, 131 Cal.Rptr. 90, 551 P.2d 410. It further contended that even if Payne had exhausted his options under the medical staff bylaws, he was nonetheless precluded from suing for damages until he had successfully challenged the result of the administrative proceeding by way of a writ of mandate. Finally, Anaheim Memorial argued that Payne was not, in any event, entitled to relief pursuant to the UCRA, because his relationship with the hospital was not that of a "customer, client or patron."

Anaheim Memorial attached a copy of its medical staff bylaws to its motion, and those bylaws do contain extensive procedures for internal hearings and appeal in the event of certain adverse actions taken against a physician's privileges to practice at the hospital. Section 9.7 provides that "[a]ny Practitioner has a right to a hearing/appeal and pursuant to the Hospital's fair hearing plan as set forth in Article X¹ of these Bylaws in the event any of the following actions are taken or recommended: [¶] A. denial of initial Staff appointment for a medical disciplinary cause or reason; [¶] B. denial of reappointment for a medical disciplinary cause or reason; [¶] C. revocation of Staff appointment for a medical disciplinary cause or reason; [¶] D. denial or restriction of requested clinical privileges for a medical disciplinary cause or reason; E. reduction in clinical privileges for a medical disciplinary cause or reason; [¶] F. revocation of clinical privileges for a medical disciplinary cause or reason; [¶] G. suspension of staff appointment or clinical privileges if such summary suspension remains in effect for more than 14 days. [¶] H. suspension of Clinical privileges or Medical Staff membership for a cumulative total of thirty (30) days or more for any twelve (12) month period for a medical disciplinary cause or reason."

Moreover, section 10.1.1 of the bylaws provides that any staff member can initiate a request for corrective action against any other member "[w]henever the activities or professional conduct which includes harassment . . ., of any practitioner with clinical privileges are detrimental to...