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Odom v. Fairbanks Memorial Hospital (3/17/00) sp-5251
Odom v. Fairbanks Memorial Hospital (3/17/00) sp-5251
Notice: This opinion is subject to correction before publication in the
Pacific Reporter. Readers are requested to bring errors to the attention
of the Clerk of the Appellate Courts, 303 K Street, Anchorage, Alaska
99501, phone (907) 264-0608, fax (907) 264-0878.
THE SUPREME COURT OF THE STATE OF ALASKA
DAVID M. ODOM, M.D., )
) Supreme Court No. S-8007
Appellant, )
) Superior Court No.
v. ) 4FA-95-3001 CI
)
FAIRBANKS MEMORIAL HOSPITAL, )
LUTHERAN HEALTH SYSTEMS, INC.,) O P I N I O N
WESTERN HEALTH NETWORK, INC., )
JAMES H. GINGERICH, SUSAN ) [No. 5251 - March 17, 2000]
McLANE, LINDA SMITH, RONALD L.)
BLISS, HOI P. LEE, M.D., )
STEVE E. MANCILL, M.D., )
JERRY A. PERISHO, M.D., )
RANDALL K. McGREGOR, M.D., )
LAWRENCE W. STINSON, JR., )
M.D., ANESTHESIA ASSOCIATES, )
INC., WILLIAM F. STODDARD, )
M.D., DANNY R. ROBINETTE, )
M.D., )
)
Appellees. )
)
Appeal from the Superior Court of the State of
Alaska, Fourth Judicial District, Fairbanks,
Dale O. Curda, Judge.
Appearances: David M. Odom, M.D., pro se,
Fairbanks, and James Forbes, James Forbes,
P.C., Anchorage, for Appellant. Howard A.
Lazar, Delaney, Wiles, Hayes, Gerety & Ellis,
Inc., Anchorage, and David L. White, White,
Cummings & Longino, P.C., Phoenix, Arizona,
for Fairbanks Memorial Hospital, Lutheran
Health Systems, Inc., Western Health Network,
Inc., James H. Gingerich, Susan McLane, Linda
Smith, and Danny R. Robinette, M.D.,
Appellees. Leroy J. Barker, Robertson,
Monagle & Eastaugh, Anchorage, for Ronald L.
Bliss, Hoi P. Lee, M.D., Steve E. Mancill,
M.D., Jerry A. Perisho, M.D., Randall K.
McGregor, M.D., Lawrence W. Stinson, Jr.,
M.D., Anesthesia Associates, Inc., and William
F. Stoddard, M.D., Appellees.
Before: Matthews, Chief Justice, Compton,
Fabe, and Bryner, Justices. [Eastaugh,
Justice, not participating.]
COMPTON, Justice.
FABE, Justice, concurring in part and
dissenting in part.
I. INTRODUCTION
David M. Odom sued Fairbanks Memorial Hospital and
various health care providers, asserting eleven separate claims for
relief. All of Odom's claims were dismissed for failure to state
a claim upon which relief may be granted. He seeks reversal on
eight of the dismissed claims. We reverse the superior court's
order dismissing those eight claims.
II. FACTS AND PROCEEDINGS
David M. Odom is a licensed physician. He was employed
by Fairbanks Memorial Hospital (FMH) as an anesthesiologist from
1988 until his staff privileges were terminated in 1994. FMH is
the only full service civilian hospital in Fairbanks.
Anesthesiologists employed by FMH enter into an agreement
(Anesthesiologist Agreement) with FMH which provides that each
party to the Anesthesiologist Agreement will get a pro-rated share
of the anesthesia practice at FMH.
In December 1992 Odom informed FMH administrators of his
intention to establish an outpatient surgery center. It was Odom's
announcement of his plans to open the Fairbanks Surgery Center
(FSC), in potential competition with FMH, that Odom argues
precipitated the events that resulted in the termination of his
staff privileges.
In October 1993 Odom refused to work with nurse
anesthetist Kay Wilson. FMH suspended Odom's staff privileges for
twenty-four hours and his rights under the Anesthesiologist
Agreement were terminated. Unable to exercise rights under the
Anesthesiologist Agreement, Odom could get an anesthesiology
assignment only if specifically requested by a patient or surgeon.
His pro-rated share of the anesthesia work was distributed to the
remaining five anesthesiologists. In December 1993 Odom's rights
under the Anesthesiologist Agreement were reinstated.
FMH continued to conduct an investigation into quality
assurance issues surrounding Odom's medical practices that were
raised by other anesthesiologists. A Special Investigative
Committee (SIC) was formed to investigate these issues. Upon FMH's
request for an opinion as to what should be done in regard to
Odom's staff privileges, the American Medico-Legal Foundation
(AMLF) recommended that Odom attend "extensive [Continuing Medical
Education] or . . . repeat a period of anesthesia residency
training." SIC, however, recommended that FMH suspend Odom's staff
privileges.
In June 1994 the FMH Executive Committee recommended to
its Governing Board that Odom's staff privileges be suspended until
the earliest of one of the following occurred:
1. The request to the Governing Body
that [Odom's] privileges be terminated is
finally resolved; or
2. The Executive Committee approves a
written proposal from [Odom] that [his]
privileges be exercised only when [he is]
accompanied by and supervised by an
anesthesiologist with appropriate
qualifications; or
3. [Odom] attend[s] further residency
training or other proctored form of additional
training which results in recommendations
which satisfy the Executive Committee that [he
has] identified and corrected the problems
which have resulted in the substandard level
of care reflected by the attached documents.
On August 22, 1994, Odom entered a formal
evaluation/retraining program at Loma Linda University Medical
Center. On September 10, while he was still in the retraining
program, the Governing Board accepted the Executive Committee's
recommendation to terminate Odom's medical staff membership and
clinical privileges. Odom was informed of his termination on
September 27. In compliance with 42 U.S.C. § 11133, FMH reported
to a national reporting system that Odom's staff privileges had
been terminated. The reasons given for Odom's termination were
"Incompetence/Malpractice/Negligence." Persons who are the
subjects of such a report are allowed to comment on the report;
Odom did so. In his response, Odom alleged that the quality
assurance investigation was a result of his announced intention to
compete with FMH and that the information provided in the report
was knowingly false.
Upon Odom's completion of the program at Loma Linda, he
reapplied for staff privileges at FMH and was denied.
Odom, pro se, brought suit against FMH, Lutheran Health
System; Western Health Network; Former FMH Administrator James H.
Gingerich; FMH Assistant Administrator Susan McLane; FMH Quality
Assurance Manager Linda Smith; FMH attorney Ronald Bliss; medical
doctors Hoi P. Lee, Steve E. Mancill, Jerry A. Perisho, Lawrence W.
Stinson and William F. Stoddard; Anesthesia Associates, Inc.;1 and
former Chief of the FMH Surgery Department, Danny R. Robinette
(collectively FMH). Odom alleged eleven claims for relief: (1)
unreasonable restraint of trade; (2) group boycott; (3) attempted
monopolization; (4) defamation; (5) breach of contract; (6) unfair
trade practices; (7) tortious interference with prospective
economic advantages; (8) intentional infliction of emotional
distress; (9) denial of due process and equal protection; (10)
claim for declaratory relief; and (11) permanent injunction.
The superior court granted FMH's motion to dismiss for
failure to state a claim, pursuant to Alaska Rule of Civil
Procedure 12(b)(6), dismissing all of Odom's claims. It awarded
FMH attorney's fees and costs in the amount of $7,220.30. It
awarded the doctors and Anesthesia Associates, Inc. attorney's fees
and costs in the amount of $5,520.00. Odom appeals the ruling as
to eight of the eleven claims. Odom also appeals the superior
court's order granting attorney's fees.
III. DISCUSSION
A. Standard of Review
An order dismissing a complaint for failure to state a
claim is reviewed de novo. See Kollodge v. State, 757 P.2d 1024,
1026 n.4 (Alaska 1988). For a complaint to survive a Rule 12(b)(6)
motion, the complaint need only allege a set of facts "consistent
with and appropriate to some enforceable cause of action." Linck
v. Barokas & Martin, 667 P.2d 171, 173 (Alaska 1983). A complaint
should be deemed sufficient, and a motion to dismiss denied, if
"evidence may be introduced that will sustain a grant of relief to
the plaintiff." Id. Because complaints should be liberally
construed, "[m]otions to dismiss are viewed with disfavor and
should rarely be granted." Kollodge, 757 P.2d at 1026.
B. The Superior Court Improperly Dismissed All of Odom's
Claims Alleging That FMH Violated Alaska's Antitrust
Statute, AS 45.50562-.596.
Odom alleges that FMH violated two separate provisions of
Alaska's antitrust act, AS 45.50.562 and AS 45.50.564. He raises
three claims: (1) unreasonable restraint of trade,2 (2) group
boycott,3 and (3) unlawful monopoly.4 We look to federal precedent
when analyzing an antitrust claim. See West v. Whitney-Fidalgo
Seafoods, Inc., 628 P.2d 10, 14 (Alaska 1981) ("The legislature
intended that Alaska courts would look to Sherman Act cases in
construing the [antitrust] Act."). Claims brought under AS
45.50.562 are also referred to as Sherman Act § 1 claims; claims
under AS 45.50.564 have been termed Sherman Act § 2 claims.
1. Odom alleged injury to competition overall, as is
necessary for Odom to have standing to sue FMH for
antitrust violations.
For a private litigant seeking treble damages to have
standing, "[a] plaintiff must show not only the fact of injury from
the alleged violation, but that the injury alleged is 'of the type
the antitrust laws were intended to prevent and that flows from
that which makes defendants' acts unlawful.'" KOS v. Alyeska
Pipeline Serv. Co., 676 P.2d 1069, 1073-74 (Alaska 1983) (quoting
Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 479
(1977)). Furthermore, the "plaintiff must demonstrate that the
defendant's conduct was intended to or did have some
anticompetitive effect beyond his own loss of business or the
market's loss of a competitor." KOS, 676 P.2d at 1074 (quoting
California Computer Prods., Inc. v. International Bus. Machs.
Corp., 613 F.2d 727, 732 (9th Cir. 1979)).
Paragraphs 7 and 135 of Odom's complaint allege facts
sufficient to establish standing to sue under Alaska's antitrust
statute.5
In a similar case, the United States Court of Appeals for
the Ninth Circuit found that a doctor proved injury to competition
and had standing to sue for having his medical staff privileges
terminated. See Pinhas v. Summit Health, LTD., 880 F.2d 1108 (9th
Cir. 1989). The doctor alleged that the "conspiracy was intended
to boycott his attempts at providing patients with lower prices as
a result of his ability to perform operations at a rate quicker
than that of his competitors." Id. at 1116. The court held that
Pinhas could prove injury to competition by showing "that his
preclusion . . . substantially reduced total competition in the
market." Id. Odom has alleged facts that, assuming them true,
show that total competition of the Fairbanks market was reduced
because of FMH's actions. If the trier of fact finds, as Odom's
complaint alleges, that termination of Odom's staff privileges
financially incapacitated him so that he could not continue with
his plans to open FSC, the competitive market for anesthesiology
services in Fairbanks was harmed by FMH's action.
2. Odom alleged a prima facie case of unreasonable
restraint of trade.
To establish a prima facie case of unreasonable restraint
of trade under AS 45.50.562, Odom must set forth facts which if
proven would establish that "the defendants combined or conspired
with an intent to unreasonably restrain trade." Smith v. Northern
Mich. Hosps., Inc., 703 F.2d 942, 949 (6th Cir. 1983). Whether
actions are tantamount to unreasonably restraining trade is
determined by either the rule of reason test or the per se
analysis. The rule of reason test should be applied to Odom's
termination of staff privileges to determine whether FMH's conduct
was unreasonable. See Miller v. Indiana Hosp., 843 F.2d 139, 144
n.6 (3d Cir. 1988) ("[I]n a hospital staff privilege case in which
the hospital defends on lack of professional ability, the rule of
reason test would apply."). To establish unreasonable restraint of
trade under the rule of reason test, Odom must prove three
elements: "(1) an agreement or conspiracy among two or more persons
or distinct business entities; (2) by which the persons or entities
intend to harm or restrain competition; and (3) which actually
injures competition." Oltz v. St. Peter's Community Hosp., 861
F.2d 1440, 1445 (9th Cir. 1988).
Applying the rule of reason test, paragraphs 2, 7, and
135 of Odom's complaint allege a prima facie case of unreasonable
restraint of trade.
3. Odom alleged facts sufficient to state a claim that
FMH engaged in a per se group boycott.
Group boycotts constitute per se violations of the
Sherman Act § 1, and Alaska's statutory equivalent, AS 45.50.562.
Id. at 1445 n.1 ("Group boycotts or concerted refusals to deal
constitute per se categories . . . ."). The three characteristics
which are "indicative of per se illegal boycotts [are]: (1) the
boycott cuts off access to a supply, facility, or market necessary
to enable the victim firm to compete; (2) the boycotting firm
possesses a dominant market position; and (3) the practices are not
justified by plausible arguments that they enhanced overall
efficiency or competition." Hahn v. Oregon Physicians' Serv., 860
F.2d 1501, 1509 (9th Cir. 1988). See also Northwest Wholesale
Stationers, Inc. v. Pacific Stationery & Printing Co., 472 U.S.
284, 294-95 (1985).
Paragraphs 3, 5, 50, and 52 of Odom's complaint allege
facts sufficient to state a claim that FMH engaged in a group
boycott.
4. Odom alleged enough facts to state a claim for
attempted monopolization.
Odom's final antitrust claim alleges that FMH violated
AS 45.50.564. 6
"'[A] prima facie case of attempt to monopolize is made
out by evidence of a specific intent to monopolize "any part" of
commerce, plus anti-competitive conduct directed to the
accomplishment of that unlawful purpose.'" West v. Whitney-Fidalgo
Seafoods, Inc., 628 P.2d 10, 15 (Alaska 1981) (alteration in
original) (quoting Greyhound Computer v. International Bus. Machs.,
559 F.2d 488, 504 (9th Cir. 1977)). The court noted that "[t]he
more market power that exists, the more likely it is that a given
course of questionable conduct will suggest the existence of intent
to monopolize." Id.
Paragraphs 3, 7, 15, and 25 of Odom's complaint
sufficiently allege an attempt to monopolize claim.
C. Odom Stated a Claim for Defamation.
A prima facie case of defamation requires the plaintiff
to establish "(1) a false and defamatory statement; (2) an
unprivileged publication to a third party; (3) fault amounting at
least to negligence on the part of the publisher; and (4) the
existence of either 'per se' actionability or special harm."
French v. Jadon, Inc., 911 P.2d 20, 32 (Alaska 1996). For a
statement to be libel per se, "the words used must be so
unambiguous as to be reasonably susceptible of only one
interpretation -- that is, one which has a natural tendency to
injure another's reputation." Fairbanks Publ'g Co. v. Pitka, 376
P.2d 190, 194 (Alaska 1962).
Included in Odom's allegations of defamatory conduct is
a claim that FMH defamed Odom in its reporting of the disciplinary
action to the federally mandated National Practitioner Data Bank
(Data Bank), a report FMH is required to make. Although a health
care entity that is complying with the federal reporting
requirement, pursuant to 42 U.S.C. § 11133(a)(1), is afforded a
certain amount of immunity in reporting to the Data Bank, that
immunity is limited. 42 U.S.C. § 11137(c) provides that "No person
or entity . . . shall be held liable in any civil action with
respect to any report made under this subchapter . . . without
knowledge of the falsity of the information contained in the
report." FMH, therefore, is immune from liability unless it had
knowledge that the report was false.
In our view "falsity" in this statute refers to a false
report of the nature of or the stated reasons for the actions of a
health care entity. Thus in Brown v. Presbyterian Healthcare
Services, 101 F.3d 1324, 1334 (10th Cir. 1996), a report was made
to the Data Bank that Brown's obstetrical privileges had been
suspended for the coded reasons "Incompetence/Mal-
practice/Negligence." But the reason stated by the health care
provider in the suspension order was that Brown had failed to abide
by an agreement to consult in handling certain types of cases.
Since the stated reason relied on by the health care provider did
not necessarily match the stated reason reported to the Data Bank,
the court concluded that a jury question was presented as to
whether the report to the Data Bank was false and whether the
defendant who had made the report knew it to be so. That is not
the situation here where the complaint and exhibits attached to the
complaint demonstrate the facial truth of the report to the Data
Bank -- that Odom was suspended for stated reasons expressed by FMH
that fairly fell within the coded reasons. The statutory privilege
would be meaningless if it meant that one who accurately reported
the stated reasons for a health care provider's action would
nonetheless have to defend the underlying validity of the stated
reasons. Thus, to the extent that Odom's claim is based on the
assertion that the stated reasons relied on by the health care
provider were not those reported to the Data Bank, Odom's claim was
properly dismissed.
However, Odom's defamation claim asserts many
communications other than the falsity of the stated reasons
reported to the Data Bank. To the extent that it does so it
alleges a prima facie case of defamation. Paragraphs 3, 5, 9, 50,
and 146-150 of Odom's complaint allege a prima facie case of
defamation.
D. The Order of Suspension Does Not Preclude Odom from Suing
FMH for Breach of an Oral Contract.
Odom claims FMH breached an oral contract. The contract,
he alleges, resulted from statements made by defendant Ronald
Bliss, on which Odom relied when he withdrew his request for an
administrative hearing. Odom's complaint alleges:
On August 30, 1994 Defendant Bliss entered
into a verbal agreement with [Odom's] attorney
Burbank authorizing [Odom's] course of study
at LLUMC as a remedy which if satisfactorily
completed, would fulfill the June 2, 1994
Order of Suspension and allow [Odom] to return
to his practice at FMH. Bliss and Burbank
further agreed that in light of [Odom's]
participation in the training program at Loma
Linda that the FMH medical staff
administrative hearing scheduled for November,
1994 would not be required.
The alleged oral contract was made subsequent to Odom receiving the
Order of Suspension,7 which listed three options the Executive
Committee could take in relation to Odom's suspension.8
The Order of Suspension, dated June 2, 1994 is clear;
Odom's suspension was to continue until "the earliest of one [of
three] events." The existence of the Order of Suspension does not,
however, preclude Odom from making a claim that there was a
separate oral contract made and breached by FMH. Whether an oral
contract exists is an issue for the trier of fact and was
improperly dismissed by the superior court. See George v. Custer,
862 P.2d 176, 178 n.3 (Alaska 1993) ("It is for the trier of fact
to determine whether an oral contract exists and the contract's
terms where the evidence conflicts."); B.B. & S. Constr. Co., Inc.
v. Stone, 535 P.2d 271, 273 (Alaska 1975) ("Where the existence of
an oral contract and the terms thereof are the points in issue and
the evidence is conflicting, it is for the trier of the facts to
determine whether the contract did in fact exist and, if so, the
terms thereof.").
E. Odom Stated a Claim for Violation of Alaska's Unfair
Trade Practices Act.
Odom sought relief for violation of AS 45.50.471(a), 9
(b)(7), (11) and (12). 10 Odom, as a private litigant, sued for
violation of the Unfair Trade Practices Act pursuant to former
AS 45.50.531. 11 "Two elements must be proved to establish a prima
facie case of unfair or deceptive acts or practices under the
Alaska Act: (1) that the defendant is engaged in trade or commerce;
and (2) that in the conduct of trade or commerce, an unfair act or
practice has occurred." State v. O'Neill Investigations, Inc., 609
P.2d 520, 534 (Alaska 1980). "An act or practice is deceptive or
unfair if it has the capacity or tendency to deceive. Actual
injury as a result of the deception is not required. . . . All
that is required is a showing that the acts and practices were
capable of being interpreted in a misleading way." Id. at 534-35
(footnotes omitted).
Paragraphs 3, 8, 15, 50, 73, 119, and 125 of Odom's
complaint allege facts sufficient to state a claim under Alaska's
Unfair Trade Practices Act.
F. Odom Alleged Sufficient Facts to State a Claim that FMH
Interfered with His Prospective Economic Advantage with
the FSC.
The tort of intentional interference with prospective
economic advantage is analyzed under the same rubric as the tort of
intentional interference with contractual relations. See Oaksmith
v. Brusich, 774 P.2d 191, 198 (Alaska 1989). The elements a
plaintiff must prove when alleging intentional interference with a
prospective economic advantage are:
[I]s [there] sufficient evidence that: 1) a
prospective business relationship existed
. . . 2) [the defendant] knew of the
prospective relationship and intended to
prevent its fruition, 3) the prospective
business relationship did not culminate in
pecuniary benefit to [the plaintiff], 4) [the
defendant's] conduct interfered with the
prospective relationship, 5) the interference
caused [the plaintiff's] damages, and 6) [the
defendant's] conduct was not privileged or
justified.
Id. Under the theory of intentional interference with prospective
economic advantage, "a person who is involved in an economic
relationship with another, or who is pursuing reasonable and
legitimate prospects of entering such a relationship, is protected
from a third person's wrongful conduct which is intended to disrupt
the relationship." Ellis v. City of Valdez, 686 P.2d 700, 707
(Alaska 1984).
Odom alleges facts which if proven state a claim that FMH
intentionally interfered with his prospective business relationship
with FSC. Odom alleges: (1) a prospective business relationship
existed between him and the Fairbanks Surgery Center, Inc., a
distinct and separate entity;12 (2) FMH knew of this relationship;
(3) Odom has not been able to open the FSC because he was
financially devastated when his staff privileges were terminated;
(4) FMH intentionally interfered with his relationship with FSC by
terminating his staff privileges; (5) terminating his staff
privileges damaged him financially so as to be unable to open FSC;
and (6) FMH's conduct was not privileged or justified.
G. The Superior Court Abused Its Discretion in Making the
Threshold Determination that FMH's Conduct Was Not
Outrageous and Odom Did Not Suffer Severe Distress.
The last claim Odom appeals is the dismissal of his claim
for damages arising from intentional infliction of emotional
distress. Odom alleges that the "[d]efendants' conduct
intentionally inflicted extreme emotional distress upon [him]."
To establish a prima facie case of intentional infliction
of emotional distress, the plaintiff must prove that the defendant
"through extreme or outrageous conduct . . . intentionally or
recklessly cause[d] severe emotional distress or bodily harm to
another." Richardson v. Fairbanks N. Star Borough, 705 P.2d 454,
456 (Alaska 1985). This court has stated that a trial judge
"should make a threshold determination whether the severity of the
emotional distress and the conduct of the offending party warrant
a claim of intentional infliction of emotional distress." Id. A
trial judge's threshold determination, should not be overruled by
this court "absent an abuse of discretion." Id.
This court has held that liability for intentional
infliction of emotional distress should only be found when "'the
conduct has been so outrageous in character, and so extreme in
degree, as to go beyond all possible bounds of decency, and to be
regarded as atrocious, and utterly intolerable in a civilized
community.'" Hawks v. State, Dep't of Pub. Safety, 908 P.2d 1013,
1016 (Alaska 1995) (quoting Oaksmith v. Brusich, 774 P.2d 191, 200
(Alaska 1989)). The conduct in which FMH allegedly engaged reaches
the level of outrageousness necessary for Odom to state a claim for
intentional infliction of emotional distress. Paragraphs 3, 7, 8,
35, 119, and 125 of Odom's complaint allege facts sufficient to
state a claim of intentional infliction of emotional distress.
IV. CONCLUSION
Odom's complaint alleges facts which if proven are
sufficient to state a claim for unreasonable restraint of trade,
group boycott, attempted monopolization, defamation, breach of oral
contract, unfair trade practices, interference with a prospective
economic advantage, and intentional infliction of emotional
distress. Accordingly, we REVERSE the superior court's dismissal
of these claims and its awards of attorney's fees to FMH and to the
doctors and Anesthesia Associates, Inc.
FABE, Justice, concurring in part and dissenting in part.
I disagree with the court's view that Odom has alleged a
prima facie case of defamation. Although the court is correct in
its determination that Fairbanks Memorial Hospital should not be
liable for its report to the National Practitioner Data Bank, the
court also concludes that "Odom's defamation claim asserts many
communications other than the falsity of the stated reasons
report[ed] to the Data Bank" and thus "alleges a prima facie case
of defamation." It is with this conclusion that I disagree.
Odom's complaint contains a broad charge that FMH
engaged in a pattern of communicating "false and fraudulent
information against the Plaintiff" and avers that these
communications "occurred on numerous occasions by United States
mail, telephone, in person, and through other forms of fraudulent
communications." But the only specific instances of defamation
described in the complaint are FMH's report to the National
Practitioner Data Bank, which this court has disallowed as a basis
for a claim of defamation, and Odom's own report of his predicament
to insurance companies and lending institutions. The question
presented to the superior court in the motion to dismiss was
whether these latter instances of "self-publication" could form the
basis of a defamation claim. The superior court decided that they
could not, dismissing the defamation claim on the basis that "the
statements were not false or defamatory because Odom had lost his
hospital privileges. Also, the statements were not concerning
another, as Odom relayed the information about his predicament."
In his briefing before us on appeal, Odom does not
contest the superior court's conclusion that "Odom has self-
published, which is not grounds for a defamation action." Instead,
he argues that FMH's transmission of information about his
terminated privileges to the National Practitioner Data Bank forms
the basis of his defamation claim:
[D]efendants have uttered and published
false and defamatory statements about
plaintiff in writing and, upon information and
belief, orally, with respect to plaintiff's
conduct, employment, career, and fitness to
practice medicine. . . .
In support of this allegation, Odom
alleged the following:
Gingerich sent notification of Odom's
termination to the U.S. National Practitioner
Data Bank as mandated by 42 U.S.C. § 11111.
Gingerich further characterized the reason for
Odom's dismissal in this notification as
"incompetence/malpractice/negligence." This
defamed Odom nationally to all future possible
hospital practice positions.
(Emphasis in original.)
Odom has pointed to no other instance of defamation in
his complaint1 or his briefing to this court. The only issue that
he has raised and discussed is the report to the National
Practitioner Data Bank. Because we resolve this issue against
Odom, I disagree with the draft's conclusion that other claims of
defamation survive.
APPENDIX A
Odom's complaint reads in part:
2. This action arises out of Defendants' combination and
conspiracy to unlawfully restrain trade and harm competition
in operating room services and anesthesiology services,
combination and conspiracy to dominate the relevant market for
operating room services and anesthesiological [sic] services,
and group boycott, all having substantial and injurious
effects upon interstate commerce. This action also arises out
of Defendants' open-ended and continuous pattern and scheme to
defraud, discharge, defame and compete unfairly with Plaintiff
in connection with Plaintiff's professional career in general,
Plaintiff's professional affiliation with defendants in
particular, Plaintiff's plans to develop an outpatient surgery
center, which pattern and scheme involves multiple victims,
including the general public, has already extended from at
least October 5, 1992 to date, and threatens to continue.
3. As more fully set forth below, upon information and belief,
defendant anesthesiologists Jerry A. Perisho, M.D., Hoi P.
Lee, M.D., Randall K. McGregor, M.D., Steve E. Mancill, M.D.,
Lawrence W. Stinson, Jr., M.D., and William F. Stoddard, M.D.,
as well as Defendant Anesthesia Associates, Inc., with the
knowledge, participation, and acquiescence of Defendants
Fairbanks Memorial Hospital ("FMH" or the "Hospital"),
Lutheran Health Systems ("LHS"), Western Health Network
("WHN"), FMH Administrator James H. Gingerich, Assistant
Administrator Susan McLane, FMH Quality Assurance Manager
Linda Smith, attorney Ronald L. Bliss, Danny R. Robinette,
M.D.[,] as well as with other unnamed co-conspirators, who
include physicians within the Hospital, and with malice and
intent to injure Plaintiff; (a) engaged in a pattern of
conduct pursuant to which they improperly removed Plaintiff
from the FMH medical staff in bad faith and reported this act
to the United States National Practitioner Databank, thus
preventing Plaintiff from pursuing his livelihood and
practicing his specialty in any hospital[;] (b) fabricated
false claims and exaggerated other claims against plaintiff on
quality of care issues, used discriminatory criteria in
quality of care determinations, and acted in secrecy to
further their personal interests rather than those of the
patients of the Hospital; (c) subverted the mandated Quality
Assurance and Peer Review mechanisms, corrupted the Hospital
medical and administrative processes and controls, violated
the Hospital Medical Staff Bylaws; (d) concealed the real
anti-competitive motives for discharging and replacing
Plaintiff, communicated false and fraudulent information on
repeated occasions within and outside FMH, within and outside
the state, to, inter alia, medical staff, hospital
administrators and state agencies regarding Plaintiff's
performance; (e) caused Plaintiff to be discharged from the
FMH medical staff by improperly influencing FMH Medical Staff
procedures in bad faith[;] (f) fabricated additional
allegations against plaintiff after his termination from the
FMH medical staff in an attempt to further alter the record
and give credibility to their actions.
4. The communication of false and fraudulent information against
the Plaintiff occurred on numerous occasions by United States
mail, telephone, in person, and through other forms of
fraudulent communications and activities.
5. Acting under [the] color of Federal and State law, the
Defendants also reported, maliciously and in bad faith, these
false and fraudulent allegations as the purported basis for
their action to other hospitals and State agencies, the U.S.
National Practitioner Databank, and triggered a government
investigation against Plaintiff. This action was part of a
successful effort to utilize a sham to exclude plaintiff from
the medical staff of the Hospital, and from anesthesiological
[sic] practice throughout the State of Alaska and throughout
the United States of America for anti-competitive purposes.
. . . .
7. Defendant FMH and Anesthesia Associates, Inc., Lee, McGregor,
Perisho, Mancill, Stinson, and Stoddard achieved their anti-
competitive objective of maintaining monopoly status in a
geographically isolated market area for both the Fairbanks
Memorial Hospital and the contracted FMH anesthesiologists by
successfully discouraging the development of a competing
surgery center by financially incapacitating and ruining the
reputation of its developer and promoter.
8. Such conduct has harmed and continues to harm and will
continue to harm in the future both consumers of
anesthesiology care and operating room services in the
Fairbanks North Star Borough area.
9. Absent the successful development of a surgery center,
Defendants have precluded Plaintiff from the operating room
practice of anesthesiology at FMH or elsewhere by a fabricated
and pretextual basis. Defendants have maliciously, willfully
and intentionally defamed plaintiff by fabricating instances
of plaintiff's misconduct, exaggerating other claims against
Plaintiff, and reporting such false and defamatory statements
verbally and in writing to the U.S. National Practitioner
Databank and to state regulatory authorities, all in
furtherance of their scheme.
. . . .
15. Fairbanks Memorial Hospital ("FMH") is a non-profit hospital,
located in Fairbanks, Alaska, is authorized to do business in
Alaska, and is the only full service hospital in Alaska north
of the Alaska (mountain) Range.
. . . .
25. FMH is presently the sole civilian provider of operating room
services in the Fairbanks market area.
. . . .
35. As soon as FMH, LHS and WHN understood that Plaintiff Odom was
or could become a competitive threat to FMH and its monopoly
of operating room services, Defendant Gingerich conspired with
Defendants Anesthesia Associates, Inc., Lee, McGregor,
Perisho, and Mancill, and later with Defendants Stinson and
Stoddard, all of whom share in a parallel monopoly for the
provision of related services, to embark on a course of action
to discredit Odom and ultimately to remove from him his
livelihood, through impugning his medical competence. Hence,
FMH, WHN, LHS and the Defendants Anesthesia Associates, Inc.,
Lee, McGregor, Perisho, Mancill, Stinson, and Stoddard in
complicity with Defendants Bliss, McLane, Smith, and Robinette
sought to remove Odom's financial capacity in order to prevent
him from pursuing development of the competing enterprise and
to prevent him from seeking judicial redress.
. . . .
50. When the Defendants Anesthesia Associates, Inc., Lee,
McGregor, Perisho, and Mancill learned of Odom's decision,
they contacted the Chief of Staff of FMH, Keith Gianni, M.D.,
and requested that Odom's hospital privileges to practice
medicine at FMH be immediately suspended, without notice or
hearing. Defendants Anesthesia Associates, Inc., Lee,
McGregor, Perisho, and Mancill represented to Dr. Gianni that
Odom's conduct was disruptive and impaired patient care.
Defendants Anesthesia Associates, Inc., Lee, McGregor,
Perisho, and Mancill also represented to Dr. Gianni that there
were quality assurance issues which also warranted an
immediate suspension of privileges. Based on these
representations, all of which were false, the Chief of Staff
did, in fact, enter an emergency order suspending Odom's
privileges to practice at FMH, effective immediately . . . .
. . . .
52. Within twenty-four hours after requesting FMH's Chief of Staff
to immediately suspend Odom's hospital privileges, Defendants
Anesthesia Associates, Inc., Lee, McGregor, Perisho, Mancill,
and Stinson met, in secret with FMH administrator Gingerich,
FMH Outpatient Services administrator Susan McLane, and FMH
Quality Manager Linda Smith, excluding Odom's participation,
and agreed among themselves to:
(a) preclude Odom from practicing anesthesiology at FMH
under the terms and provisions of the 1993
Anesthesia Agreement and future agreements;
(b) preclude Odom from receiving a pro-rated share of
the anesthesia practice at FMH;
(c) disparage Odom's professional reputation by
innuendo, accusations and false statements relative
to Odom's professional competence, thusly
preventing Odom from pursuing his outpatient
surgery center project. . . .
(d) missuse the peer review process to advance personal
and corporate anti-competitive ends.
. . . .
73. A set of accusations were prepared under the guidance of
attorney Bliss. These accusations deliberately exaggerated
the severity of the purported incidents and mischaracterized
and defamed Plaintiff. Further, the Defendants exaggerated
the severity of the incidents to justify their request to the
Medical Staff Executive Committee for Formal Corrective
Action. Besides the five cases reviewed by the FMH Anesthesia
Section quality assurance committee, the case informally
resolved by Surgery Department QA committee in January, 1993
is added in to make a total of six cases referenced in the
final report.
. . . .
113. Gingerich sent notification of Odom's termination to the U.S.
National Practitioner Data Bank as mandated by 42 USC 11111.
(NPDB process date 9/16/94) Gingerich further characterized
the reason for Odom's dismissal in this notification as
"incompetence/malpractice/negligence." This defamed Odom
nationally to all future possible hospital practice
positions. . . .
. . . .
119. In addition, Bliss made a mischaracterization of Odom's
practice history. Bliss made a blanket, false and
unsubstantiated statement that nine locations of previous
practice gave damning professional references. All laudatory
reports were intentionally omitted. Bliss also made
unsubstantiated intimations that where information was
lacking, it was therefore also damning. This false and
misleading practice history was presented to the FMH
Credentials Committee as well as the Ad Hoc Committee. Bliss'
statements were also a significant factor in the May 10, 1995
rejection.
. . . .
125. The statements contained in these various communications were
false and defamatory, and were uttered and published with
malice, intent to injure plaintiff and his reputation and
career, and with intent to restrain trade and monopolize the
relevant market by injuring and impairing competition.
126. Upon information and belief, in addition to the writings
referred to herein, defendants orally defamed plaintiff by
uttering false and defamatory statements of the type alleged
to prospective business partners, investors and others.
. . . .
135. The termination of plaintiff's staff privileges and membership
at Fairbanks Memorial Hospital resulted in his exclusion from
the practice of anesthesiology. Plaintiff's capability to
continue his surgery center project has been severely hampered
by his loss of financial capacity and reputation. If
successful in preventing Plaintiff from completing his
project, Defendants will have deprived many individual
patients and referring physicians of access to alternative
operating room services for a substantial period of time.
. . . .
146. Paragraphs 1 through 46 and 65 through 145 are repeated and
realleged as if set forth in full herein.
147. Defendants, as originators of the wrongful termination and
withdrawal of privileges, and other defamatory conduct and
statements set forth herein, knew that plaintiff would be
compelled to disclose the contents of such conduct and
statements to third parties in connection with applications
for hospital medical staff privileges, malpractice insurance,
membership in professional organizations, business loan
applications, stock offerings, and related purposes.
148. Plaintiff in fact has been compelled to disclose the
defamatory conduct and statements made about him to third
parties in connection with discussions for employment,
malpractice insurance, licensing, business loans, and related
purposes, and will be compelled to make further disclosures of
this type in the future.
149. The defamatory statements set forth herein were motivated by
Defendants' malice, ill will, personal spite, or in the
alternative by defendants' culpable recklessness or gross
negligence.
150. By reason of the foregoing, Defendants have uttered and
published false and defamatory statements about Plaintiff in
writing and, upon information and belief, orally, with respect
to Plaintiff's conduct, employment, career, and fitness to
practice medicine, and have compelled Plaintiff to repeat
Defendants' defamation to others in connection with his
professional career, all damaging plaintiff.
-23- 5251
APPENDIX A
APPENDIX A
Page 6 of 6 5251
Footnotes:
1 Anesthesia Associates, Inc. is an Alaska corporation
owned and operated by anesthesiologists Lee and McGregor. The
corporation employs the certified registered nurse anesthetists
(CRNAs) who work at FMH.
2 "Every contract, combination in the form of trust or
otherwise, or conspiracy, in restraint of trade or commerce is
unlawful." AS 45.50.562.
3 This is considered a per se violation of AS 45.50.562.
4 "It is unlawful for a person to monopolize, or attempt to
monopolize, or combine or conspire with another person to
monopolize any part of trade or commerce." AS 45.50.564.
5 Appendix A sets out the full text of the paragraphs of
Odom's complaint needed to decide his appeal.
6 "It is unlawful for a person to monopolize, or attempt to
monopolize, or combine or conspire with another person to
monopolize any part of trade or commerce." AS 45.50.564.
7 Odom's Order of Suspension is dated June 2, 1994.
8 The three options the Executive Committee could take
which were listed in the Order of Suspension are set out supra pp.
3-4.
9 "Unfair methods of competition and unfair or deceptive
acts or practices in the conduct of trade or commerce are declared
to be unlawful." AS 45.50.471(a).
10 (b) The terms "unfair methods of competition"
and "unfair or deceptive acts or practices"
include, but are not limited to, the following
acts:
. . . .
(7) disparaging the goods, services, or
business of another by false or misleading
representation of fact;
. . . .
(11) engaging in any other conduct creating a
likelihood of confusion or of misunderstanding
and which misleads, deceives or damages a
buyer or a competitor in connection with the
sale or advertisement of goods or services;
(12) using or employing deception, fraud,
false pretense, false promise,
misrepresentation, or knowingly concealing,
suppressing, or omitting a material fact with
intent that others rely upon the concealment,
suppression or omission in connection with the
sale or advertisement of goods or services
whether or not a person has in fact been
misled, deceived or damaged.
AS 45.50.471(b).
11 (a) A person who suffers an ascertainable loss
of money or property as a result of another
person's act or practice declared unlawful by
AS 45.50.471 may bring a civil action to
recover actual damages or $200, whichever is
greater. The court may, in cases of wilful
violation, award up to three times the actual
damages sustained. The court may provide
other relief it considers necessary and
proper.
Former AS 45.50.531(a).
12 The Articles of Incorporation for the Fairbanks Surgery
Center were recorded on March 9, 1994. On September 18, 1995, the
State of Alaska granted the Fairbanks Surgery Center a "Certificate
of Need."
1 The paragraphs of the complaint cited by the court do not
support its conclusion that Odom has alleged other defamatory
statements. Paragraphs 146-150 contain the "self-publication"
claims, and paragraphs 5 and 9 allege malicious reporting to the
National Practitioner Data Bank. Paragraphs 3 and 50 do not relate
to defamation at all, instead alleging that the hospital wrongfully
revoked his hospital privileges, "fabricat[ing] false claims and
exaggerat[ing] other claims against [Odom] on quality of care
issues."
