Rosen v. Board of Medical Examiners of State of Iowa

• Decision Date: 25 October 1995
• Docket Number: No. 94-691,94-691
• Citation: 539 N.W.2d 345
• Parties: Robert Mark ROSEN, Appellant, v. BOARD OF MEDICAL EXAMINERS OF the STATE OF IOWA, Appellee.
• Court: Iowa Supreme Court

Page 345

539 N.W.2d 345

Robert Mark ROSEN, Appellant, v. BOARD OF MEDICAL EXAMINERS OF the STATE OF IOWA, Appellee.

No. 94-691.

Supreme Court of Iowa.

Oct. 25, 1995.

As Corrected on Denial of Rehearing Nov. 17, 1995.

Craig F. Graziano and James W. O'Brien of Dickinson, Mackaman, Tyler & Hagen, P.C., Des Moines, for appellant.

Thomas J. Miller, Attorney General, and Maureen McGuire, Assistant Attorney General, for appellee.

Considered en banc.

NEUMAN, Justice.

This controversy centers on the meaning of "fraud in procuring a license," the reason given by the Iowa Board of Medical Examiners for denying Robert Rosen's application to practice medicine in Iowa. The district court upheld the board's decision on judicial review. Rosen now appeals, claiming the board erroneously equated inaccuracy with fraud. Finding no error, we affirm.

The facts are undisputed. Rosen is a graduate of Rutgers University and the New York College of Osteopathic Medicine. In 1987, he successfully completed a one-year internship at Kennedy Memorial Hospitals in New Jersey, followed by a one-year family practice residency in Brooklyn, New York. He was certified by the American Osteopathic Board of General Practice in 1989.

In August 1988, Rosen began what he thought would be a three-year preceptorship in dermatology under the supervision of D.P. Knapp, M.D., in Moline, Illinois. The first two years of the preceptorship were approved by the American Osteopathic Association (AOA). However, during the third year, Knapp sold the practice and moved to Iowa. Rosen continued to work in Moline for another year but, at the suggestion of the AOA, completed the third year of his preceptorship with a doctor in California.

Meanwhile, Knapp began pressuring Rosen to join him in practice in Iowa. Rosen procrastinated in completing the required application form. Knapp eventually appeared on Rosen's doorstep with the form in hand, urging him to sign it in blank and assuring him that he would complete the form based on Rosen's curriculum vitae. Rosen agreed to Knapp's plan and the application was submitted to the board for approval.

The form submitted by Rosen, via Knapp, erroneously stated that Rosen had completed a three-year dermatology preceptorship under Knapp's supervision. It made no mention of the fact that the AOA had approved only two years of Rosen's tenure in Moline, or that Rosen had completed the preceptorship elsewhere. Several questions on the application were also left unanswered. Left blank were inquiries about pending investigations by other state licensing boards and whether Rosen had ever been sued for malpractice. (The record reveals that Rosen was, in fact, named as a codefendant in a suit along with Knapp.) The application also sought information not customarily found on a resume, such as questions about substance abuse and criminal convictions. Knapp apparently answered these queries based on his acquaintance with Rosen.

Following its investigation, the board advised Rosen by letter that it was denying licensure based on Rosen's failure to make "full, complete and accurate disclosures" regarding section 11 of the form, residencies. Rosen filed a notice of appeal and moved for more specific statement. The board responded with further detail about the discrepancies that had surfaced concerning Rosen's residencies. Rosen also sought an informal hearing with board staff and legal counsel. The informal hearing yielded a concession by Rosen's counsel that the inaccuracy stemmed from the form having been signed in blank, Rosen's certification to the contrary notwithstanding. ¹ This explanation failed to resolve the matter and the case proceeded to contested hearing.

Rosen testified in his own behalf at the hearing. He explained that the inaccuracies and incomplete information in his application resulted from the fact that he foolishly entrusted Knapp with the responsibility of filling it out. He conceded that the application contained an affidavit, signed by him, certifying under penalty of perjury that the information contained therein was true and correct. He professed no knowledge about who might have notarized his signature. He expressed regret at his lack of good judgment but maintained that he had no intent to deceive the board by the information provided or omitted.

At the close of evidence, the State moved to amend the board's more specific statement "to include the issue of signing a blank application form as being one of the factual bases to constitute fraud in obtaining a license." The motion was granted over Rosen's objection that it was untimely.

The board found Rosen violated Iowa Code section 258A.10 (1991), ² fraud in procuring a license, by

intentionally pervert[ing] the truth in making his application for medical licensure in Iowa, by signing the attestation on the application form when the form was blank, and [failing] to subsequently review the answers on the form for their truthfulness.

The district court affirmed the board's decision on judicial review and this appeal by Rosen followed.

I. Our decision is largely controlled by the limited scope of our review. What we said in a recent licensing case bears repeating here:

A court's review of agency action is severely circumscribed. The administrative process presupposes that judgment calls are to be left to the agency. Nearly all disputes are won or lost there. Thus the court may reverse, modify, or grant other appropriate relief only if agency action is affected by error of law, is unsupported by substantial evidence in the record, or is characterized by abuse of discretion.

Burns v. Board of Nursing, 495 N.W.2d 698, 699 (Iowa 1993) (citations omitted).

II. The first issue is whether the board properly rested its decision, in part, on facts not mentioned in the original denial of licensure or in its response to Rosen's motion for more specific statement. Both these documents referenced only Rosen's failure to make full, complete and accurate disclosures concerning residencies. Once Rosen tendered his defense of signing the form in blank, however, the State successfully moved to add another ground upon which its fraud claim could rest. Rosen claims on appeal that permitting the amendment violated his right to procedural due process. Our review of such a constitutional claim is de novo. Freeland v. Employment Appeal Bd., 492 N.W.2d 193, 195 (Iowa 1992).

The crux of Rosen's claim is that the amendment changed, without notice, the issue being tried. Like the district court, we disagree with his contention. At all times the issue was whether Rosen's application for licensure could be denied on the basis of fraud in its procurement. The amendment merely enlarged the factual basis supporting the charge. It neither altered the legal issues presented nor subjected Rosen to new and distinct charges. Cf. Committee on Professional Ethics & Conduct v. Wenger, 454 N.W.2d 367, 369 (Iowa 1990) (lawyer entitled to separate notice and hearing on charge of false testimony stemming from statements made during trial on charges of professional neglect and failure to respond to grievance committee); Weiner v. Board of Regents, 3 A.D.2d 113, 117-19, 158 N.Y.S.2d 730, 734-35 (1956) (doctor, faced with discipline based on criminal income tax evasion charge, could not be disciplined without notice on amended charge of fee splitting that stemmed from his own testimony).

As noted by the district court, Rosen is in no position to complain of surprise or prejudice. All of the evidence pertinent to the false affidavit was furnished by Rosen himself. Rosen nevertheless claims that, with proper notice, he "could have altered his preparations to meet the new charge head on." (Emphasis added.) Given his defensive posture in this case, we find the argument untenable. No new charge was filed. This is not a case in which a search for the truth became a trap for the unwary. See Wenger, 454 N.W.2d at 369. No denial of due process has been shown.

III. Iowa Code section 147.4 grants the Iowa Board of Medical Examiners authority to deny licensure on the "grounds for which a license may be revoked or suspended." Iowa Code section 147.55(1) provides that a license may be revoked or suspended for "[f]raud in procuring a license." The term "fraud in procuring a license" is defined at 653 Iowa Administrative Code 12.4(1) as conduct including, but not limited to

an intentional perversion of the truth in making application for a license to practice medicine and surgery, ... and includes false representations of a material fact, whether by word or by conduct, by false or misleading allegations, or by concealment of that which should have been disclosed when making application for a license in this state, or attempting to file or filing with the board ... any false or forged diploma, or certificate or affidavit or identification or qualification in making an application for a license in this state.

Rosen cites error in the board's application of this standard, claiming the definition departs from the common law definition of fraud. In a common law action for fraud, the following elements must be proven: (1) a material misrepresentation, (2) made knowingly (scienter), (3) with intent to induce the plaintiff to act or refrain from acting, (4) upon which the plaintiff justifiably relies, (5) with damages. Hoefer v. Wisconsin Educ. Ass'n Ins. Trust, 470 N.W.2d 336, 340 (Iowa 1991); see Garren v. First Realty, Ltd., 481 N.W.2d 335, 338 (Iowa 1992); Hall v. Wright, 261 Iowa 758, 766, 156 N.W.2d 661, 666 (1968). Rosen asserts that the board not only failed to consider these elements in its definition, the record does not support the board's finding of fraud as a matter of law. We shall consider the arguments in turn.

A. Although statutory construction is ultimately a judicial function, we are obliged to "give weight to an agency's construction of a statute so long as the agency does not purport...