Snodgrass-King Pediatric Dental Assocs., P.C. v. Dentaquest U.S. Ins. Co.

• Decision Date: 23 February 2018
• Docket Number: NO. 3:14–cv–00654,3:14–cv–00654
• Citation: 295 F.Supp.3d 843
• Parties: SNODGRASS–KING PEDIATRIC DENTAL ASSOCIATES, P.C. and David J. Snodgrass, Plaintiffs, v. DENTAQUEST USA INSURANCE CO., INC., Defendant.
• Court: U.S. District Court — Middle District of Tennessee

295 F.Supp.3d 843

SNODGRASS–KING PEDIATRIC DENTAL ASSOCIATES, P.C. and David J. Snodgrass, Plaintiffs,

v.DENTAQUEST USA INSURANCE CO., INC., Defendant.

NO. 3:14–cv–00654

United States District Court, M.D. Tennessee, Nashville Division.

Signed February 23, 2018

Erin Palmer Polly, Gibeault C. Creson, John C. Hayworth, Joseph F. Welborn, III, Robert Jackson Walker, Butler Snow LLP, Nashville, TN, for Plaintiffs.

Connor M. Blair, Jeffrey W. Sheehan, R. Brandon Bundren, Russell B. Morgan, Tara S. Sarosiek, Ty E. Howard, Bradley Arant Boult Cummings LLP, Nashville, TN, for Defendant.

MEMORANDUM OPINION

WAVERLY D. CRENSHAW, JR., CHIEF UNITED STATES DISTRICT JUDGE

This case was tried before a jury from November 14–22, 2016. The sole issue was whether in 2013 DentaQuest USA Insurance Co., Inc. ("DentaQuest"), retaliated against Snodgrass–King Pediatric Dental Associates, P.C., and David J. Snodgrass, D.D.S. (collectively "Snodgrass–King"), in violation of the First Amendment to the United States Constitution. (Doc. No. 331.) The jury returned a verdict in favor of Snodgrass–King for $7.4 million in compensatory damages and $14.8 million in punitive damages. (Doc. No. 391.) Before the Court are Snodgrass–King's Motions to Alter Judgment to Provide for Prejudgment Interest and Post–Judgment Interest (Doc. No. 410), for Attorney's Fees (Doc. No. 418), and to Supplement Motion for Attorney's Fees (Doc. No. 446). Also before the Court are DentaQuest's Motion for Judgment as a Matter of Law (Doc. No. 411) and for a New Trial (Doc. No. 413). On February 20, 2018, the Court heard oral argument on DentaQuest's Motion for Judgment as a Matter of Law (Doc. No. 411). For the following reasons, DentaQuest's Motion for Judgment as a Matter of Law (Doc. No. 411) is GRANTED , DentaQuest's Motion for a New Trial (Doc. No. 413) is CONDITIONALLY GRANTED , and Snodgrass–King's Motions to Alter Judgment (Doc. No. 410) and for Attorney's Fees (Doc. Nos. 408, 446) are DENIED AS MOOT .

I. JUDGMENT AS A MATTER OF LAW

DentaQuest argues that no reasonable jury could find that it was a state actor in its exclusion of Snodgrass–King from the TennCare network in 2013 for the purposes of 28 U.S.C. § 1983. (Doc. No. 412 at 6.) Alternatively, DentaQuest contends that no reasonable jury could find that Snodgrass–King established a First Amendment violation. (Id. at 19.)

Under Federal Rule of Civil Procedure 50(b), a court may grant a motion for judgment as a matter of law "only if in viewing the evidence in the light most favorable to the non-moving party, there is no genuine issue of material fact for the jury, and reasonable minds could come to but one conclusion, in favor of the moving party." Radvansky v. City of Olmsted, 496 F.3d 609, 614 (6th Cir. 2007). The party seeking a judgment as a matter of law must "overcome the substantial deference owed a jury verdict." Id. The court may not "reweigh the evidence or assess the credibility of witnesses." Id.

A. EVIDENCE AT TRIAL

Snodgrass–King is a multi-office dental practice group that has five dental offices in middle Tennessee. (Doc. No. 399 at 83.) Its offices are located in Williamson, Davidson, Wilson, and Rutherford Counties. (Doc. No. 400 at 194.) The practice encompasses all types of dentistry, including orthodontics, pediatric and adult dentistry, and oral surgery. (Doc. No. 399 at 84.) Snodgrass–King treated TennCare dental patients, who are generally under the age of twenty-one, until 2003, and then again from 2009–13. (Doc. No. 400 at 67, 69.) Snodgrass–King also participates in the CoverKids network, another state government assistance dental network for children. (Doc. No. 403 at 91.) Testifying for Snodgrass–King were its two partners, Snodgrass and John Terry King, D.D.S. (Doc. No. 400 at 57, 118.) Two other dentists who work for Snodgrass–King, Miriam Hall, D.D.S., and Crystal Gilreath Rucker, D.M.D., also testified at trial. (Doc. No. 399 at 75; Doc. No. 400 at 29.)

For the purposes of this Opinion, TennCare is a state entity that pays certain fees for medical procedures for persons who are unable to pay.¹ (Doc. No. 400 at 39–40.) Tennessee is not an "any willing provider state," meaning that it does not have to include any and all willing providers who desire to participate in its TennCare network. (Id. at 200–01.) Instead, TennCare uses a Dental Benefits Manager to contract with a network of dental providers to treat its patients for reimbursement. (Id. at 200; Doc. No. 403 at 11.)

Dr. James Gillcrist was the Dental Director of the Bureau of TennCare ("TennCare") at all times relevant to this lawsuit. (Doc. No. 400 at 164; Doc. No. 404 at 131.) Wendy Long, M.D., was the Chief Medical Officer of TennCare during the same timeframe.² (Doc. No. 449–1 at 29; Ex. 152 at 22327.) Manny Martins was the Deputy Director of Finance and Administration in 2001, and subsequently became Director of the Bureau of TennCare at the time of Snodgrass–King's 2003 termination from the TennCare network. (Doc. No. 400 at 171.) No one from TennCare testified at trial.³

DentaQuest has been the Dental Benefits Manager for TennCare since 2013. From 2002 to 2010, Doral Dental of Tennessee, LLC ("Doral") was TennCare's

Dental Benefits Manager. (Doc. No. 403 at 11.) In 2004, DentaQuest, LLC, purchased the membership interest in Doral. (Id. ) Doral subsequently changed its name to DentaQuest of TennCare, LLC, to reflect its new status as a DentaQuest company. (Id. ) "[A] number of individuals who played significant roles in the success of [Doral's work with] the TennCare program from 2002–2010 are still with [DentaQuest, LLC in 2013]" and remained involved in DentaQuest's operation of the TennCare dental network. (Doc. No. 449–1 at 14; Ex. 9 at 546.)

1. Doral's 2003 Decision to Exclude Snodgrass–King From the TennCare Network

Starting around 2001, Snodgrass voiced his concerns about the management of the TennCare network to a number of Tennessee officials. (Doc. No. 400 at 140; Ex. 59 at 120.) Snodgrass testified: "I've voiced my concerns to my state representatives, to my U.S. congressman, to my U.S. senator. I've voiced my concerns to governmental—every governmental official that I knew the name of." (Doc. No. 400 at 140.) He wrote letters critical of Doral and TennCare to Governor Phil Bredesen (Ex. 59 at 132), as well as directly to TennCare officials (Ex. 59 at 120, 132).

On May 16, 2003, Doral's Tennessee peer review committee, consisting of Chairman F. William Taylor, D.D.S., four other dentists, and Doral Executive Michelle Blackwell, reviewed twenty of Snodgrass' patient files. (Doc. No. 398 at 218, 248; Ex. 608.) Doral kept the provider name confidential, so that the peer review committee did not know whose files it was reviewing. (Doc. No. 406 at 36.) Blackwell, Doral's non-dentist representative, composed the agenda and provided the record, while the Tennessee-licensed dentists made the findings of fact and recommendations. (Id. at 68.) The Tennessee peer review committee found that Snodgrass excessively utilized stainless steel crowns, and recommended Snodgrass' termination from the TennCare network. (Doc. No. 398 at 224; Ex. 611.) The Tennessee peer review committee sent that recommendation to Doral. (Doc. No. 398 at 239–40; Doc. No. 406 at 50.)

On May 30, 2003, Doral acted on that recommendation when Norris Knight, D.D.S., the Credential Committee Chairman for Doral, sent a letter to Snodgrass explaining that Snodgrass was too aggressive in his use of stainless steel crowns. (Ex. 612.) That letter did not state that Snodgrass soon would be terminated, but rather that he would be subject to "revised criteria requirements" to determine the medical necessity of some stainless steel crowns procedures. (Id . ) Snodgrass explained that he used more stainless steel crowns than other doctors because his patients consisted of children with the greatest medical problems that needed more aggressive treatment. (Doc. No. 400 at 280.)

On July 1, 2003, Doral terminated, without cause, all Snodgrass–King providers from participating in the TennCare network, effective July 9, 2003. (Id. at 69–70, 136, 256.) After Snodgrass inquired about the reason Doral excluded him, he learned that Doral's Tennessee peer review committee had recommended his termination. (Id. at 243; Ex. 611.) Doral executive Steven Pollock took part in the decision to terminate Snodgrass–King, along with Blackwell and other executives. (Doc. No. 449–1 at 5–6.) Pollock testified that TennCare had concerns about including Snodgrass in the network, and, as TennCare was Doral's customer, Doral discussed with TennCare how to handle Snodgrass. (Id. at 21.)

The relationship between the State and Snodgrass–King continued to grow more tense. At some point in 2003, Snodgrass informed Nashville's Channel 4 News about his termination from the TennCare network. (Doc. No. 404 at 135.) Channel 4's Investigative Team went to Gillcrist's house to interview him about that decision. (Id. at 135–36.) On July 16, 2003, David Florsheim, an account management employee for Doral, wrote a letter to Pollock, Director of Provider Services Marcel Tetzlaff, Brett Bostrack, and two other Doral management employees, explaining that Florsheim had a conversation with Gillcrist about Snodgrass directing his patients to call the State and TennCare about his termination from the network. (Doc. No. 449–1 at 25–26.) Gillcrist said that TennCare and the governor's office had been "inundated with calls" by the Snodgrass–King patients. (Id. at 26.)

In mid-July 2003, Gillcrist called King to inform him that Snodgrass–King's patients were calling Gillcrist's office and the governor's office about the termination. (Doc. No. 400 at 72–74.) He told King that if his patients did not stop writing letters to and calling his office and the governor's officee, he would have Snodgrass–King "investigated" and "shut down." (Id. at 75–76.) On July 24, 2003, Dr. Taylor emailed Gillcrist, Blackwell, and four...