Guzman v. Mem’l Hermann Hosp. Sys. – Full Text

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION

WENDY GUZMAN, INDIVIDUALLY
AND AS NEXT FRIEND OF TRISTAN
GUZMAN, A MINOR,

Plaintiff,

VS.

MEMORIAL HERMANN HOSPITAL
SYSTEM, D/B/A MEMORIAL
HERMANN SOUTHEAST HOSPITAL,

Defendants.

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§ CIVIL ACTION NO. H-07-3973
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MEMORANDUM AND OPINION

In this medical malpractice suit, Wendy Guzman, individually and on behalf of her

son, Tristan Guzman, sued Memorial Hermann Hospital System, d.b.a. Memorial Herman

Southeast Hospital (“Memorial Hermann”) in November 2007 in Texas state court. Guzman

asserted a claim under the Emergency Medical Treatment and Active Labor Act, 28 U.S.C.

§ 1395dd (“EMTALA”) based on emergency-room treatment Tristan received at Memorial

Hermann in February 2006. Memorial Hermann timely removed to this court on the basis

of federal-question jurisdiction. Guzman has amended her complaint to add state-law

negligence claims against Memorial Hermann; Philip Haynes, M.D., Ph.D.; Memorial

Southeast Emergency Physicians, LLP (“MSEP”); and Emergency Consultants, Inc. (“ECI”).

Dr. Haynes was the emergency-room physician who saw Tristan Guzman at Memorial

Hermann. Dr. Haynes was a partner in MSEP, which is a limited liability partnership of

emergency-room physicians. MSEP, a Michigan LLP registered to do business in Texas, had

a contract with Memorial Hermann to provide emergency physician staffing to the hospital.

ECI, a Michigan corporation with its principal place of business in Michigan, had an

administrative services agreement with MSEP to provide administrative and support services.

ECI has moved to dismiss under Rule 12(b)(2) of the Federal Rules of Civil

Procedure, asserting a lack of personal jurisdiction. (Docket Entry No. 27). ECI

alternatively moved to dismiss under Rule 12(b)(6) for failure to state a claim, asserting that

Guzman’s claims are barred by limitations and that Texas law does not recognize the single

business enterprise theory as a basis for recovery. (Id.). After conducting jurisdictional

discovery, Guzman responded, (Docket Entry No. 45), ECI replied, (Docket Entry No. 47),

and Guzman filed a supplemental response, (Docket Entry No. 48).

Dr. Haynes has filed a “motion challenging the adequacy of plaintiffs’ expert report.”

The motion is filed under Section 74.351 of the Texas Civil Practice & Remedies Code.

(Docket Entry No. 20). Memorial Hermann moved to dismiss Guzman’s state-law claims

based on the failure to comply with Section 74.351. (Docket Entry No. 21). Both motions

are directed at the report filed by Joseph Varon, M.D., stating that in his opinion both Dr.

Haynes and Memorial Hermann failed to meet the applicable standard of care and were

negligent in treating Tristan. (Docket Entry Nos. 20, 21). Guzman responded, (Docket Entry

No. 40).

Based on a careful review of the motions, responses, and replies; the parties’

submissions; and the applicable law; this court grants ECI’s motion to dismiss for lack of

personal jurisdiction and denies the motions challenging Dr. Varon’s expert report and

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seeking to dismiss based on that report. The reasons for these rulings are explained below.

Background

The amended complaint sets out the alleged facts. On February 12, 2006, Tristan

Guzman, then seven years old, was feeling ill. His parents took him to the emergency room

at Memorial Hermann in Houston, Texas. Dr. Haynes obtained Tristan’s medical history,

conducted a physical examination, and ordered several laboratory tests, including a white

blood cell differential count. A few hours later, Dr. Haynes diagnosed Tristan with viral

syndrome and released him from the hospital. Dr. Haynes told the Guzmans that Tristan’s

condition should begin to improve within 24 hours but to return to the emergency room if he

was not better. Dr. Haynes did not prescribe antibiotics when Tristan was released.

The Guzmans brought Tristan back to the Memorial Hermann emergency room the

following morning, February 13, 2006. Dr. Mohammed Siddiqi conducted a physical

examination and ordered laboratory tests and a chest x-ray. These tests showed that Tristan

had pneumonia and probable sepsis. Tristan subsequently experienced severe complications,

including a body temperature of 111.2 degrees. He had to be intubated, packed in ice, and

transported by helicopter to Memorial Hermann Children’s Hospital. As a result of septic

shock, Tristan suffered injuries to his organs. Although Tristan’s condition improved after

spending time in the hospital, he still requires follow-up medical care and therapy.

Guzman’s EMTALA claims against Memorial Hermann include failing to provide an

appropriate medical screening examination, failing to stabilize Tristan’s condition before

discharging him, and failing to provide an appropriate transfer in a timely manner. Guzman

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also asserts a state-law negligence claim against Memorial Hermann for failing to provide

adequate procedures for reporting lab results and for recalling patients to the hospital when

abnormal lab results are reported.

Guzman alleges that Dr. Haynes was negligent in failing to order a chest x-ray, failing

to determine the results of the white blood cell differential count before discharging Tristan

from the hospital, discharging Tristan with neither the results of the count nor antibiotics, and

failing to arrange for the emergency room staff to report to him the white blood cell

differential count as soon as it became available so that he could contact the Guzmans if it

was sufficiently abnormal to require additional evaluation or treatment.

Guzman alleges that MSEP is liable for the torts of its partner, Dr. Haynes. As to ECI,

Guzman asserts that it is liable to the same extent as MSEP for the negligence and gross

negligence of Haynes. Guzman bases the claims against ECI on the allegation that it was

“operating as a single business enterprise with or alternatively as the alter ego of” MSEP.

ECI has submitted an affidavit by Dr. James Johnson, the CEO and sole stockholder.

(Docket Entry No. 28). The record also contains Dr. Johnson’s deposition, (Docket Entry

No. 45-2, at 1-32), as well as the administrative service contract between ECI and MSEP.

(Docket Entry No. 45-2, at 33-39). ECI provides physician groups with nonmedical

administrative services and support that include payroll administration, software that

provides template forms to document patient care known as the “QualChart System,” billing

and collection operations, scheduling physicians, and assisting with physician recruiting.

Since 1975, ECI has contracted with many physician groups across the country to provide

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such services. Robert Williams, M.D., is the Chairman of ECI’s Board of Directors and

Thomas Zguris, M.D., is ECI’s regional director. ECI is not registered to do business in

Texas; does not own, possess or use property in Texas; does not maintain a mailing address

or telephone listing in Texas; does not have a bank account in Texas; does not keep, maintain

or store documents in Texas; and does not maintain a registered agent for service of process

in Texas. (Docket Entry No. 28, Affidavit of James Johnson, M.D.).

In early 1998, Johnson learned that Memorial Hermann Hospital System was looking

to retain a new emergency physician group. Johnson traveled to Houston, Texas on several

occasions in the spring and summer of 1998 to meet with representatives from Memorial

Hermann. Johnson asserts that he was not representing ECI in these meetings but was acting

in his personal capacity “as a businessman looking to create business in Texas,” (Docket

Entry No. 45-2, Johnson Deposition at 22:5-9), but the result of his meetings was an

agreement with the Memorial Hermann Hospital System. Johnson testified in his deposition

that Williams and Zguris traveled to Houston to meet with Memorial Hermann on ECI’s

behalf and that he was also present at some of these meetings. After these negotiations, ECI

submitted a written proposal to the Memorial Hermann Hospital System, which resulted in

a verbal agreement that ECI would form physician groups to provide emergency care at five

Memorial Hermann Houston-area hospitals. Johnson formed five separate limited

partnerships to staff the emergency rooms at these hospitals. Each partnership was organized

under Michigan law but registered to do business in Texas. Johnson was the managing

partner and controls 99% of the capital and voting rights of each partnership. The other 1%

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was divided among the self-employed emergency room doctors who were partners of each

of the limited partnerships. Each of the partnerships signed a contract with ECI under which

it agreed to provide administrative and support services for the partnerships in return for an

administrative services fee. Each of the partnerships also signed an agreement with one of

the hospitals in the Memorial Hospital System. ECI has similar limited partnership

arrangements in approximately thirteen states. (Docket Entry No. 45-2, Johnson Deposition

at 54).

On July 2, 1998, MSEP and ECI signed an administrative services contract. (Docket

Entry No. 45-2, at 33-39). The contract provided that MSEP would pay ECI for services

including assistance in physician recruiting, physician scheduling, payroll services, assistance

with obtaining and maintaining professional liability insurance, billing and collection

services, preparation of financial reports, and a range of consulting services. ECI was

appointed as MSEP’s attorney-in-fact to do the acts necessary to carry out the administrative

services agreement. The contract stated that “[t]he responsibility for providing health care

shall at all times remain with the self-employed health care providers contracting with the

LLP. All services relating to providing health care to patients shall be in accordance with

the independent medical judgment of the self-employed health care providers and shall not

be subject to the supervision, direction or control of LLP or ECI.” (Docket Entry No. 45-2,

at 39).

As part of its agreement to provide administrative and support services, ECI provided

the physician groups such as MSEP with a software system for documenting patient care and

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treatment. The QualChart System software provided “a collection of blank forms,”

“documentation templates for physicians to select, print, and implement in the exercise of

their independent medical judgment.” (Docket Entry No. 28, Affidavit of James Johnson,

M.D., at ¶ 5). The system was designed “to help physicians document the patient

encounter.” (Docket Entry No. 45-2, at 46). Johnson testified in his deposition that the

QualChart System included “patient pathways” for the physician to choose among,

depending on a patient’s symptoms. These pathways were intended to help physicians

“make the right diagnosis and treatment that comply with accepted standards of care.”

(Docket Entry No. 45-2, at 41). ECI created the QualChart System to “improve

documentation” and “allow physicians to rely less on memory for high-risk clinical

scenarios,” (Docket Entry No. 45-2, at 50). In 1998, when the contracts were put into place,

ECI put the computer systems together in Michigan and shipped them to Texas, and an ECI

IT employee traveled to Texas to train the physicians on the system. (Docket Entry No. 45-

2, Johnson Deposition at 41).

ECI’s regional director, Zguris, was the primary contact between ECI and the LLPs

and the Memorial Hermann hospitals. Zguris made multiple trips to Houston, Texas between

1998 and 2007. In 2004, 2005, and 2006, he visited Texas at least ten times each year.

While in Texas, Zguris visited the hospitals, met with the hospitals’s employees, and met

with physician members of the LLPs. Zguris gave oral reports to Johnson about his Texas

visits. Zguris also interviewed physicians seeking to become members of the limited

partnerships. If a candidate was acceptable to Zguris, that doctor would apply for hospital

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privileges and interview with the hospital medical director or hospital administrator. If the

hospital approved the doctor, then Johnson, as managing partner of the LLP, would hire the

doctor to join the LLP physician group. The evidence shows that ECI did not recruit

physicians in Texas to work with the LLPs. Instead, ECI would advertise in a national

emergency medicine journal and would use nationwide direct mailing. Any responding

physician would interview with ECI but would also have to interview with the local

physician group and with the hospital to be hired as a self-employed physician partner with

one of the LLP physician groups.

Under the administrative services contracts with MSEP and the other physician

limited partnerships, ECI was responsible for creating and maintaining physician work

schedules to ensure that the emergency rooms were adequately staffed at all times. Doctors

requested the days and times they wanted to work and ECI put together a monthly emergency

room schedule. ECI mailed or e-mailed these schedules from Michigan to Texas. If a doctor

was sick or otherwise unavailable to work an assigned shift, ECI employees would contact

the hospital and make arrangements to switch schedules so that the emergency room was

adequately staffed.

ECI provided billing, collection, and accounting services for each of the limited

partnerships, including MSEP, through Apollo, a wholly owned ECI subsidiary. Hospital

employees sent emergency room charts from Texas to Apollo in Fort Myers, Florida. Apollo

conducted electronic coding on each chart, then prepared and sent out bills on behalf of the

limited partnerships. Apollo sent the electronic billing data to ECI in Michigan, where ECI

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employees entered the data into the limited partnerships’s financial records. ECI’s

accountant prepared separate financial reports and tax returns for each of the limited

partnerships. ECI and the LLPs filed separate tax returns.

ECI also generated statistical reports that measured physician and physician-group

performance in the emergency rooms at the Memorial Hermann hospitals. These reports

included patient waiting-room time, how many patients came to the emergency room per

hour, how many patients a particular physician saw per hour, how long it took a doctor to see

a patient, patient turnaround time based on diagnosis, and other similar data. ECI provided

these reports to the Memorial Hermann hospitals on a quarterly basis.

ECI had one employee in Texas during the relevant period, a full-time “practice

manager” who worked with local insurance companies and managed-care companies to

negotiate fee schedules and payments for services. Johnson described this employee,

Christine Harris, as “like an accountant.” (Docket Entry No. 51, Johnson Deposition at 68).

Harris lived in Houston but was ECI’s practice manager for the state of Texas. ECI had no

other employees in Texas.

ECI maintained a 401K plan that it made available to physician partners. ECI also

permitted physician partners to purchase insurance from the ECI health insurance plan.

(Docket Entry No. 45-2, Johnson Deposition at 48).

The record also showed that ECI has been involved in one other piece of litigation in

Texas. One of the physician partners who worked at a different Memorial Hermann hospital

than the one at which Dr. Haynes worked and Guzman was treated sued ECI in 2006. The

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dispute arose out of the contractual relationship between ECI and that physician partnership.

The physician alleged that ECI was interfering with her independent medical judgment in

practicing emergency room medicine. She filed a petition to take depositions in advance of

filing a lawsuit to investigate a “potential claim” that ECI was engaging in the corporate

practice of medicine, which Texas law prohibits. See TEX. OCC. CODE § 165.156. ECI filed

a petition for a writ of mandamus in Texas state court on January 3, 2007 seeking to quash

the deposition on the ground that there was no private cause of action under that Texas

statute.

Dr. Johnson described the contractual arrangement between ECI and the physician

partnerships and between those partnerships and the Memorial Hermann hospitals as a

“system contract” with Memorial Hermann. (Docket Entry No. 45-2, at 41). Dr. Johnson

would from time-to-time authorize loans from one of the five physician partnerships to

another, to adjust for the fact that some of the partnerships served hospitals that saw many

more uninsured patients than other hospitals. (Docket Entry No. 45-2, Johnson Deposition

at 84-87). The loans were not repaid but were treated as expenses. Guzman points to this

transfer of funds as evidence that ECI and the physician partnerships were either a single

business enterprise or to support the alter ego theory.

II.

ECI’s Motion to Dismiss for Lack of Personal Jurisdiction

The Legal Standard

A federal court sitting in diversity may exercise personal jurisdiction over a

nonresident defendant if the long-arm statute of the forum state confers personal jurisdiction

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over that defendant and exercise of such jurisdiction by the forum state is consistent with due

process under the United States Constitution. Delgado v. Reef Resort, Ltd., 364 F.3d 642,

644 (5th Cir. 2004). The Texas long-arm statute confers jurisdiction to the limits of due

process. Stroman Realty, Inc. v. Antt, 528 F.3d 382, 385 (5th Cir. 2008); see TEX. CIV. PRAC.

AND REM. CODE ANN. ‘ 17.041–045; see also Religious Tech. Ctr. v. Liebreich, 339 F.3d

369, 373 (5th Cir. 2003). Due process permits the exercise of personal jurisdiction over a

nonresident defendant when the defendant has “minimum contacts” with the forum state and

the exercise of jurisdiction over the defendant does not offend “traditional notions of fair play

and substantial justice.” Johnston v. Multidata Systems Intern. Corp., 523 F.3d 602, 609 (5th

Cir. 2008) (quoting Wilson v. Belin, 20 F.3d 644, 647 (5th Cir.), cert. denied, 513 U.S. 930,

115 S.Ct. 322, 130 L.Ed.2d 282 (1994)).

A plaintiff bears the burden of demonstrating facts sufficient to support personal

jurisdiction over a nonresident defendant. That burden is met by a prima facie showing;

proof by a preponderance of the evidence is not necessary. Revell v. Lidov, 317 F.3d 467,

469 (5th Cir. 2002); Alpine View Co. Ltd. v. Atlas Copco AB, 205 F.3d 208, 215 (5th Cir.

2000). “The court may determine the jurisdictional issue by receiving affidavits,

interrogatories, depositions, oral testimony, or any combination of the recognized methods

of discovery.” Id. “[O]n a motion to dismiss for lack of jurisdiction, uncontroverted

allegations in the plaintiff’s complaint must be taken as true, and conflicts between the facts

contained in the parties’ affidavits must be resolved in the plaintiff’s favor.” Johnston, 523

F.3d at 609 (quoting D.J. Invs. v. Metzeler Motorcycle Tire Agent Gregg, Inc., 754 F.2d 542,

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546 (5th Cir. 1985)).

The “minimum contacts” aspect of the analysis can be established through “contacts

that give rise to ‘specific’ personal jurisdiction and those that give rise to ‘general’ personal

jurisdiction.” Wilson, 20 F.3d at 647. A court’s exercise of specific jurisdiction is

appropriate only when the nonresident defendant’s contacts with the forum state arise from,

or are directly related to, the cause of action. Gundle Lining Const. Corp. v. Adams County

Asphalt, Inc., 85 F.3d 201, 205 (5th Cir. 1996) (citing Helicopteros Nacionales de Colombia,

S.A. v. Hall, 446 U.S. 408, 414 n.8 (1984); Religious Tech. Ctr., 339 F.3d at 375; Quick

Techs., Inc. v. Sage Group PLC, 313 F.3d 338, 344 (5th Cir. 2002)). To determine whether

specific jurisdiction exists, a court must “examine the relationship among the defendant, the

forum, and the litigation to determine whether maintaining the suit offends traditional notions

of fair play and substantial justice.” Gundle Lining Const., 85 F.3d at 205; Helicopteros, 466

U.S. at 414 n.8. Even a single contact can support specific jurisdiction if the defendant

“purposefully avails itself of the privilege of conducting activities within the forum state,

thus invoking the benefits and protections of its laws.” Burger King Corp. v. Rudzeqicz, 471

U.S. 462, 475 (1985). A court may exercise specific jurisdiction when: (1) the nonresident

defendant purposely availed itself of the privileges of conducting activities in the forum state;

and (2) the controversy arises out of or is related to the defendant’s contacts with the forum

state. Freudensprung v. Offshore Tech. Serv., 379 F.3d 327 (5th Cir. 2004) (citations

omitted). “The non-resident’s ‘purposeful availment’ must be such that the defendant

‘should reasonably anticipate being haled into court’ in the forum state.” Ruston Gas

Turbines, Inc. v. Donaldson Co., Inc., 9 F.3d 415, 419 (5th Cir. 1993) (citing World-Wide

Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980)). Specific jurisdiction requires a

sufficient nexus between the nonresident defendant’s contacts with the forum and the cause

of action. Rittenhouse v. Mabry, 832 F.2d 1380, 1390 (5th Cir. 1987).

When the cause of action does not arise from or relate to the foreign defendant’s

purposeful conduct within the forum state, due process requires that the foreign defendant

have engaged in continuous and systematic contacts with the forum state before a court may

exercise general personal jurisdiction. Helicopteros, 466 U.S. at 414-15; Bearry v. Beech

Aircraft Corp., 818 F.2d 370, 374 (5th Cir. 1987). The plaintiff must demonstrate contacts

of a more extensive quality and nature between the forum state and the defendant than those

needed to support specific jurisdiction. Dalton v. R & W Marine, 897 F.2d 1359, 1362 (5th

Cir. 1990). “To exercise general jurisdiction, the court must determine whether ‘the contacts

are sufficiently systematic and continuous to support a reasonable exercise of jurisdiction.’”

Holt Oil & Gas Corp. v. Harvey, 801 F.2d 773, 777 (5th Cir. 1986) (quoting Stuart v.

Spademan, 772 F.2d 1185, 1191 (5th Cir. 1985) (additional citations omitted)).

Guzman argues that this Texas court has jurisdiction over ECI because: (1) the causes

of action arise out of and are directly related to ECI’s purposeful Texas contacts; (2)

MSEP’s Texas contacts can be attributed to ECI under an alter ego or single business

enterprise theory; and (3) ECI has continuous and systematic contacts with Texas sufficient

for general jurisdiction. Each ground is analyzed below.

Specific Jurisdiction

Guzman argues that specific jurisdiction is present because ECI “interjected itself into

the business of providing emergency physician staffing in Houston, Texas.” Guzman

contends that the negligent medical care Dr. Haynes provided Tristan Guzman “arises from

or is directly related to” ECI’s contacts with Texas in providing staffing of physician partners

for the Memorial Hermann Southeast Hospital emergency room. Guzman contends that ECI

did not just perform administrative and support services but instead provided MSEP with

“physician practice protocols and guidelines, a computer system to aid the physicians, and

the very forms on which Tristan Guzman’s medical history were recorded by Dr. Haynes.”

(Docket Entry No. 48, at 4). Guzman argues that ECI is vicariously liable for Dr. Haynes’s

medical malpractice because ECI had involved itself in the way in which the emergency

room doctors, such as Dr. Haynes, practiced medicine. Guzman also argues that ECI is

vicariously liable for Dr. Haynes’s negligence under the alter ego and single business

enterprise doctrines.

Guzman cites Creech v. Roberts, 908 F.2d 75 (6th Cir. 1990), a medical malpractice

case brought by an Ohio resident in Ohio against an Oklahoma hospital for treatment

received in Oklahoma. In that case, the Oklahoma hospital had solicited patients through

broadcasts aired in Ohio. Creech, an Ohio resident, went to the Oklahoma hospital in

response to the broadcast. Id. at 78. A doctor provided by the hospital performed surgery,

and Creech sued the doctor and hospital in Ohio for malpractice. Id. The court held that the

Oklahoma hospital was subject to jurisdiction in Ohio because the hospital’s broadcast meant

that it had purposefully directed its activities at Ohio residents and the cause of action arose

from that contact. The court concluded that “an action will be deemed not to have arisen

from the defendant’s contacts with the forum state only when they are unrelated to the

operative facts of the controversy.” Id. at 80.

Guzman’s reliance on Creech is misplaced. In that case, the Oklahoma hospital

solicited Ohio residents to visit its facility to receive care. Creech, 908 F.2d at 80. The court

held that Creech’s cause of action arose out of the Oklahoma hospital’s activities in Ohio

because Creech’s “exposure to the program brought her into contact” with the Oklahoma

hospital. Id. ECI did not solicit or have any contact with Tristan Guzman or his family that

brought him to the emergency room.

Since setting forth the “arise from or relate to” requirement for specific jurisdiction

in Helicopteros, the Supreme Court has given relatively little guidance as to how closely

related a cause of action must be to the defendant’s forum contacts for specific jurisdiction

to be present. Some lower courts follow a but-for test, others require that forum contacts be

relevant to a necessary element of proof, and some apply a sliding-scale analysis that is

between the first two approaches. See Nowak v. Tak How Invs., Ltd., 94 F.3d 708, 714 (1st

Cir. 1996) (discussing various approaches). The Fifth Circuit has examined the “arise from

or relate to” requirement under a but-for approach in the past. In Prejean v. Sonatrach, Inc.,

652 F.2d 1260, 1270 n. 21 (5th Cir. 1981), the court held that a plane charter “contract [was]

a but for causative factor” of a wrongful death tort suit. But the Circuit has not endorsed this

approach as the exclusive test. More recent case law suggests a narrower approach than the

“but-for” test for the relationship between the specific-jurisdiction contacts and the cause of

action. In Kelly v. Syria Shell Petroleum Dev. B. V., 213 F.3d 841, 855-56 (5th Cir. 2000) the

court concluded that Syrian companies were not amenable to specific jurisdiction in Texas

because the wrongful-death claims of workers killed in Syria were not closely related to the

companies’ recruiting activities in Texas. In Felch v. Transportes Lar-Mex SA DE CV, 92

F.3d 320, 324 (5th Cir. 1996), the court found no specific jurisdiction over a Mexican

trucking company sued in Texas when a truck hit the plaintiff’s mother’s vehicle on a

Mexican highway.

For a nonresident defendant’s forum contacts to support specific jurisdiction, Texas

courts require a “substantial connection” between those contacts and the “operative facts of

the litigation.” Moki Mac River Expeditions v. Drugg, 221 S.W.3d 569, 585 (Tex. 2007).

This requirement assesses “the strength of the necessary connection between the defendant,

the forum, and the litigation.” Id.; see also Stroman Realty, Inc. v. Wercinski, 513 F.3d 476

(5th Cir. 2008) (the “proper focus of the personal-jurisdiction analysis is on the ‘relationship

among the defendant, the forum, and the litigation’”) (quoting Calder v. Jones, 465 U.S. 783

(1984)). In Moki Mac, the plaintiffs’s minor son, from Texas, went on a river-rafting trip in

Arizona with Moki Mac, a Utah-based river rafting outfitter. Id. at 573. The child died on

the trip and the parents sued in Texas, alleging negligence on the part of the guides and

failure to exercise reasonable care in supervising the child. The Texas court found that Moki

Mac had purposefully availed itself of the privileges and benefits of conducting business in

Texas by selling trips to Texas residents; directing marketing efforts to Texas; regularly

advertising in Texas; hiring public relations firms to target media groups and tour operators,

some of which were located in Texas; soliciting Texas residents through mass and targeted

e-mail campaigns; compiling and obtaining a mailing list that included Texas residents; and

using particular customers, some located in Texas, to act as de facto trip group leaders. Id.

at 577-78. The court held, however, that the relationship between these Texas contacts and

the operative facts of the litigation – the guides’ conduct on the rafting trip and whether they

exercised reasonable care in supervising the plaintiffs’ son – were “too attenuated to satisfy

specific jurisdiction’s due-process concerns.” Id. at 585, 588; see also Kervin v. Red River

Ski Area, Inc., 711 F.Supp. 1383, 1389 (E.D. Tex. 1989) (no specific jurisdiction over

nonresident ski resort because negligence claim did not arise out of resort’s advertising

contacts with Texas but was a result of the resort’s alleged negligence in failing to maintain

safe premises in New Mexico).

Applying these recent precedents leads to the conclusion that ECI’s Texas contacts

do not provide a basis for exercising specific jurisdiction in this case arising from the alleged

negligence of a Texas emergency-room physician. The operative facts of this case involve

Dr. Haynes’s allegedly negligent emergency-room care of Tristan Guzman. Guzman alleges

that Dr. Haynes failed to order a chest x-ray, failed to review the results of the white blood

cell differential count, and failed to prescribe antibiotics before discharging Tristan Guzman.

ECI’s relevant Texas contacts are contracting to perform, and performing, nonmedical

administrative and support tasks for MSEP, the partnership to which Dr. Haynes belonged

as a self-employed physician partner. ECI did not practice medicine. ECI did not employ

Dr. Haynes or any of the physician partners of MSEP. ECI did not supervise or manage the

physicians in their practice of medicine. The contract between ECI and MSEP stated that the

responsibility for providing medical care remains with the individual physicians in

accordance with their independent medical judgment. ECI provided MSEP with nonmedical

administrative and support services. These services were not substantially connected to

Tristan Guzman’s emergency-room care.

Guzman argues that ECI was involved in the practice of medicine because it provided

MSEP and the physician partners with QualChart software, which included forms for

documenting patient care. The purpose of the QualChart system was to provide template

forms to “improve documentation” and “allow physicians to rely less on memory for high-

risk clinical scenarios.” (Docket Entry No. 45-2, at 50). Guzman argues that because the

forms would have included the patient contact form used to document Tristan’s emergency

room visit, the fact that ECI provided the form is a sufficient contact for specific personal

jurisdiction over ECI.

There is no allegation or evidence in the record that Dr. Haynes’s alleged negligent

treatment of Tristan Guzman was connected to the QualChart forms that ECI provided as part

of its administrative and support services, or to any other aspect of ECI’s contacts with

Texas. The record shows that the forms ECI provided the LLPs – including MSEP – as part

of the QualChart software included “recommended practice pathways.” A “patient pathway”

includes descriptions of key events that, if performed by physicians as described, are

expected to produce the most desirable outcomes for patients with specific conditions.

Nothing in the patient pathway directs or controls the physician’s medical judgment. Dr.

Johnson testified in his deposition that the QualChart software includes a form with a

practice pathway for pediatric patients with fever, but there is no allegation or evidence that

any such form played any part in this case. There is no basis to find a substantial connection

between Dr. Haynes’s alleged negligence and the software or forms ECI sent to Texas.

The relationship between the allegedly negligent medical care in this case and ECI’s

Texas contacts is “too attenuated to satisfy specific jurisdiction’s due-process concerns.”

Guzman’s causes of action do not arise out of ECI’s QualChart software or other ECI Texas

contact. Guzman has failed to make a prima facie showing of specific jurisdiction based on

ECI’s Texas contacts.

Guzman also argues that specific jurisdiction can be based on imputing MSEP’s

contacts to ECI under an alter ego or single business enterprise theory. Recent Texas case

law shows that the relevant inquiry is under the alter ego theory. Guzman cites several Texas

state intermediate appellate decisions applying the single business enterprise theory to

examine jurisdictional contacts, including El Puerto de Liverpool, S.A. de C.V. v. Servi

Mundo Llantero S.A. de C.V., 82 S.W.3d 622 (Tex. App. – Corpus Christi 2002, no pet.), and

N. Am. Van Lines, Inc. v. Emmons, 50 S.W.3d 103, 120 (Tex. App. – Beaumont 2001, no

pet.) In these cases, the courts stated that the factors relevant under the single business

enterprise theory include common employees, business names, and offices; centralized

accounting; payment of wages to the other corporation’s employees; services rendered by

employees of one corporation on behalf of another corporation; undocumented transfers of

funds between corporations; and an unclear allocation of profits and losses between corporate

entities. However, the Texas Supreme Court recently held that the relevant factors for

“jurisdictional veil-piercing” in a case involving a parent and a subsidiary are not those

factors associated with the single business enterprise theory but whether the “parent controls

the internal business operations and affairs of the subsidiary” and whether the evidence

shows “that the two entities cease to be separate so that the corporate fiction should be

disregarded to prevent fraud or injustice.” PHC-Minden, L.P. v. Kimberly Clark Corp., 235

S.W.3d 163, 173 (Tex. 2007) (noting that single business enterprise is “a theory we have

never endorsed”).

“[T]ypically, the corporate independence of companies defeats the assertion of

jurisdiction over one by using contacts with the other.” Access Telecom Inc. v. MCI

Telecom, Inc., 197 F.3d 694, 717 (5th Cir. 1999) (citing Hargrave v. Fibreboard Corp., 710

F.2d 1154, 1159 (5th Cir.1983)). There is a presumption in favor of corporate separateness.

Dickson Marine Inc. v. Panalpina, Inc., 179 F.3d 331, 338 (5th Cir. 1999). However, “it is

compatible with due process for a court to exercise personal jurisdiction over an individual

or a corporation that would not ordinarily be subject to personal jurisdiction in that court

when the individual or corporation is an alter ego or successor of a corporation that would

be subject to personal jurisdiction in that court. The theory underlying these cases is that,

because the two corporations . . . are the same entity, the jurisdictional contacts of one are

the jurisdictional contacts of the other for the purposes of the International Shoe due process

analysis.” Patin v. Thoroughbred Power Boats Inc., 294 F.3d 640, 653 (5th Cir. 2002). The

plaintiff has the burden of establishing a prima facie case of jurisdiction and must present

evidence to establish an alter ego relationship. Hargrave, 710 F.2d at 1160. “[T]he alter ego

test for attribution of contacts, i.e., personal jurisdiction, is less stringent than that for

liability.” Stuart, 772 F.2d at 1198, n. 12 (internal citations and quotation marks omitted);

The Richards Group, Inc. v. Brock, 2007 WL 700896, at *3 (N.D. Tex. 2007).

The Fifth Circuit has identified a “laundry list” of factors that courts should apply in

making an alter ego determination. See United States v. Jon-T Chems., Inc., 768 F.2d 686,

691-92 (5th Cir. 1985). These factors are: (1) the amount of the subsidiary’s stock owned by

the parent corporation; (2) the existence of separate headquarters for each entity; (3) the

sharing of common officers and directors; (4) the observance of corporate formalities; (5) the

maintenance of separate accounting systems; (6) the parent corporation’s exercise of

complete authority over the general policy of the subsidiary; and (7) the subsidiary’s exercise

of complete authority over its daily operations. Hargrave, 710 F.2d at 1160. In Hargrave,

the court concluded that “100% stock ownership and commonality of officers and directors

are not alone sufficient to establish an alter ego between two corporations.” Id. Rather, the

plaintiff must present prima facie evidence that “[t]he degree of control exercised by the

parent [is] greater than that normally associated with common ownership and directorship.”

Id. (citing Reul v. Sahara Hotel, 372 F.Supp. 995, 998 (S.D. Tex. 1974)).

Guzman argues that the alter ego test is met because “ECI was involved in every

aspect of the management of [MSEP].” (Docket Entry No. 48, at 4). She contends that the

daily operations of both entities were “clearly intertwined” and that there were “no formal

barriers between the entities.” (Docket Entry No. 45, at 17). Guzman asserts the following

as evidence that MSEP is the alter ego of ECI: Johnson is the CEO and sole shareholder of

ECI and was the managing partner and 99% shareholder of MSEP; ECI and MSEP were

located at the same address in Michigan; ECI and MSEP shared a centralized accounting

system; ECI performed administrative and support services for MSEP; Johnson determined

many of MSEP’s policies; the contract with Memorial Hermann was “system-wide” and

Johnson approved the transfer of funds from one physician limited partnership to another,

treating the transfers as “loans” that were not repaid but charged as expenses; the contract

between ECI and MSEP favored ECI; and physician partners of MSEP were eligible to

purchase health insurance benefits through ECI and could participate in ECI’s 401k plan.

The record does not provide a basis for finding that MSEP was the alter ego of ECI.

There is no evidence that ECI exercised substantial control over the daily medical practice

of the physician partners of MSEP. Rather, the evidence shows that ECI provided

administrative and support services and was involved in many nonmedical aspects of MSEP,

but did not control the medical practice of MSEP’s self-employed physician partners. There

is evidence that the corporate formalities of ECI and MSEP were respected. For example,

they had separate financial documents and filed separate tax returns. See, e.g., US LED, Ltd.

v. Nu Power Associates, Inc., 2008 WL 4838851, at * 6 (S.D. Tex. Nov. 5, 2008) (stock

ownership, providing office space and services, sharing employees, and training employees

was insufficient to find alter ego as the basis for personal jurisdiction in the absence of

evidence that defendant “exercised meaningful, much less ‘complete,’ control over

[company’s] daily activities”); United States ex. rel. v. Johnson Controls, Inc., No. 04-60146,

2005 WL 1630098, at *5 (E.D. Mich. Jul. 07, 2005) (providing administrative services to

subsidiary was not a basis for piercing the corporate veil to exercise personal jurisdiction

without evidence that the parent directed the subsidiary’s day-to-day operations);

Freudensprung, 379 F.3d at 346 (“[O]ur cases generally demand proof of control by one

corporation over the internal business operations and affairs of another corporation to make

the other its agent or alter ego, and hence fuse the two together for jurisdictional purposes.”)

(internal punctuation and citation omitted).

In summary, ECI’s Texas contacts are insufficient for specific personal jurisdiction,

and MSEP’s Texas contacts cannot be imputed to ECI to allow this court to exercise specific

personal jurisdiction over ECI.

General Jurisdiction

Guzman argues that general jurisdiction is present. She points to the facts that ECI

formed five limited partnerships and registered them to do business in Texas; provided a

registered agent for the limited partnerships with the Texas Secretary of State; was appointed

as their attorney-in-fact; and provided administrative services to them in Texas, including

sending physician schedules and payroll checks to Texas. ECI generated physician

performance reports that it provided to the Memorial Hermann hospitals in Texas. ECI sent

Zguris to Texas at least ten times each year in 2004, 2005, and 2006. Zguris interviewed

physicians in Texas to assist the limited partnerships with recruiting. ECI maintained one

full-time employee in Texas. ECI shipped QualChart computer systems to Texas and sent

IT employees to Houston to show physicians how to use the systems. These ECI IT

employees returned to Texas to perform maintenance and updates. ECI provided educational

materials to the physician members of the limited partnerships in Texas; invited and paid for

Memorial Hermann personnel to travel to Michigan and participate in an ECI seminar;

mailed a newsletter titled “Inside ECI” to each of the physician members of the limited

partnerships and to emergency room personnel to “generate goodwill for ECI”; and sent

Christmas presents to nonphysician emergency room personnel and administrative personnel

at Memorial Hermann. ECI filed a petition for a writ of mandamus in Texas state court on

January 3, 2007, seeking to quash presuit discovery by a Houston physician who was a

member of one of the limited partnerships.

ECI relies on Samuelson v. Honeywell, 863 F.Supp. 1503 (E.D. Okla. 1994), in which

a contract management company that provided hospitals with physician staffing services was

held not subject to general jurisdiction in Oklahoma. The company, National Emergency

Services, Inc. (“NES”), was an Illinois corporation with its principal place of business in

California. Id. at 1506. NES was licensed to do business in Oklahoma and had a registered

agent in Oklahoma. Id. NES had, in the past, contracted with three Oklahoma hospitals. Id.

When the plaintiff’s cause of action arose, these contracts had expired and NES did not have

any other Oklahoma contacts. Id. The court held that NES’s Oklahoma contacts were “not

the type of continuous and systematic corporate activities sufficient to subject NES to the

general personal jurisdiction” of Oklahoma. Id. at 1507.

Although ECI’s forum contacts are more extensive than those in Samuelson, they do

not meet the high bar set by the Supreme Court and the Fifth Circuit for general jurisdiction.

In Helicopteros, the plaintiffs filed suit in Texas against Helicol, a Colombian corporation,

on behalf of four United States citizens killed in the crash of a Helicol helicopter. 466 U.S.

at 409, 104 S.Ct. 1868. Helicol had significant contacts with Texas, including sending its

pilots to be trained there, negotiating a contract in Texas, accepting checks drawn from a

Houston bank, and purchasing most of its helicopter fleet in Texas. Id. at 416, 104 S.Ct.

1868. Nevertheless, the Court held these contacts insufficient to establish general

jurisdiction over Helicol. Id.; see also Cent. Freight Lines Inc. v. APA Transp. Corp., 322

F.3d 376, 381 (5th Cir. 2003) (finding no general jurisdiction even though the defendant

routinely arranged and received interline shipments to and from Texas and regularly sent

sales people to Texas to develop business, negotiate contracts, and service national accounts);

Wilson, 20 F.3d at 651 (“Even if [the defendant’s] contacts with Texas via his short-lived

malpractice insurance arrangement through a Texas law firm and his multi-year pro bono

association with the historical society were arguably continuous, we hold that they were not

substantial enough to warrant the imposition of general personal jurisdiction over [him].”);

Bearry, 818 F.2d at 373-76 (holding that the sale of over $250 million of products to

seventeen Texas customers over a five-year period did not constitute systematic and

continuous contacts with Texas); cf. Perkins v. Benguet Consol. Mining Co., 342 U.S. 437,

447-448, 72 S.Ct. 413, 96 L.Ed. 485 (1952) (finding general jurisdiction over a Philippine

corporation that temporarily relocated to Ohio because the corporation’s president resided in

Ohio, the corporation’s records were kept in Ohio, the board of director’s meetings were held

in Ohio, accounts were held in Ohio banks, and all key business decisions were made there);

Holt Oil & Gas Corp., 801 F.2d at 779 (upholding general jurisdiction over a nonresident

defendant who attended college in, owned real estate in, traveled to, and conducted extensive

business dealings in the forum state; his contacts evidenced “constant and extensive personal

and business connections with [the forum state] throughout [the nonresident defendant’s]

adult life”).

The record does not show that ECI had continuous and systematic contacts with Texas

such that this court could exercise general personal jurisdiction. Helicopteros, 466 U.S. at

414-15. The contacts are insufficient in both quantity and quality to support general personal

jurisdiction against ECI. The record shows that ECI contracted with limited partnerships

doing business in Texas providing emergency room physicians to Texas hospitals over a

nine-year period. As part of that contract, ECI sent representatives to Texas regularly; had

a full-time Texas employee; and sent and received numerous communications and funds to

and from Texas. The record shows that ECI had similar arrangements in thirteen states.

ECI’s involvement with Texas does not rise to the level the courts have insisted upon to find

that a nonresident defendant has a reasonable anticipation of being sued in Texas on claims

that do not arise from those contacts.

The fact that ECI filed a mandamus action in Texas state court did not subject ECI to

general personal jurisdiction in Texas. By submitting to jurisdiction in one case, a party does

not thereby consent to jurisdiction for all future suits in that forum, even if they are related.

See Mallinckrodt Med., Inc. v. Sonus Pharmaceuticals, Inc., 989 F.Supp. 265, 271 (D.D.C.

1998) (“It would be ludicrous to suggest that [parties] consented to the jurisdiction of this

Court for all time, with respect to all potential competitors, and for all purposes, simply

because they once chose to sue . . . here.”).

Because ECI lacks minimum contacts with Texas, this court need not determine

whether the exercise of jurisdiction would offend traditional notions of fair play and

substantial justice. Southern Copper, Inc. v. Specialalloy, Inc., 245 F.3d 791, 2000 WL

1910176, at *4 (5th Cir. 2000) (unpublished disposition) (citing Felch, 92 F.3d at 329 n.20

(“Because we find that the first due process condition of minimum contacts was not satisfied,

we need not address whether the exercise of personal jurisdiction in this case would offend

traditional notions of fair play and substantial justice.”)); Baldwin v. Household, Int’l, Inc.,

36 S.W.3d 273, 277 (Tex. App.–Houston [14th Dist.] 2001, no pet.) (the court would “not

reach the ‘fair play and substantial justice’ analysis” because plaintiff failed to establish

defendant’s minimum contacts with Texas). Moreover, because this court grants ECI’s

motion to dismiss, ECI’s motions to dismiss Guzman’s claims as barred by limitations and

to dismiss Guzman’s claim based on a single business enterprise theory are denied as moot.

III.

The Motions Challenging Dr. Varon’s Expert Report

Under Texas law, the plaintiff in a medical malpractice action must prove four

elements: (1) a physician’s duty to comply with a specific standard of care; (2) a breach of

the standard of care; (3) an injury; and (4) a causal connection between the breach of care

and the injury. Price v. Divita, 224 S.W.3d 331, 336 (Tex. App. – Houston [1st Dist.] 2006,

pet. denied). The standard of care must be established by expert testimony unless the mode

or form of treatment is a matter of common knowledge or is within the experience of a

layman. Jackson v. Axelrad, 221 S.W.3d 650, 655 (Tex. 2007).

On May 2, 2008, Guzman provided the defendants with the expert report of Dr.

Varon. Dr. Varon opined that Dr. Haynes’s treatment of Tristan Guzman fell below the

standard of care, which required Dr. Haynes to order and review the white blood cell

differential count test before diagnosing Tristan’s condition as viral syndrome. According

to Dr. Varon, the Memorial Hermann laboratory technician who performed the white blood

cell differential count was required by the standard of care to ensure that the abnormal result

was reviewed by a physician. Dr. Varon also opined that Memorial Hermann did not have

an adequate callback procedure for informing patients of abnormal lab results and calling

them back to the emergency department for treatment.

Dr. Haynes and Memorial Hermann challenge the adequacy of Dr. Varon’s report,

asserting that it does not meet the requirements of the Texas Civil Practice and Remedies

Code. See TEX. CIV. PRAC. & REM. CODE § 74.351. Section 74.351 requires a plaintiff who

has initiated “a health care liability claim” to serve on each party “not later than the 120th

day after the date the claim was filed . . . one or more expert reports, with a curriculum vitae

of each expert listed in the report for each physician or health care provider against whom

a liability claim is asserted.” Id. § 74.351(a). The report must provide “a fair summary of

the expert’s opinions as of the date of the report regarding applicable standards of care, the

manner in which the care rendered by the physician or health care provider failed to meet the

standards, and the causal relationship between that failure and the injury, harm or damages

claimed.” Id. § 74.351(r)(6). Under Texas law, a court must dismiss a medical malpractice

action if the expert report “does not represent a good faith effort to comply with the statute’s

requirements.” Simonson v. Keppard, 225 S.W.3d 868, 871 (Tex. App. – Dallas 2007, no

pet.); see also TEX. CIV. PRAC. & REM. CODE § 74.351(l). Dr. Haynes moved for an order

directing Guzman to produce an expert report that meets these requirements. Memorial

Hermann moved to dismiss with prejudice Guzman’s state-law claims for failure to comply

with Section 74.351. Both defendants rely on the decisions of Texas state courts to challenge

Dr. Varon’s qualifications and the content of his expert report.

The Legal Standard

As a general rule, under the Erie doctrine, when a plaintiff asserts a state-law claim

in federal court, the federal court applies state substantive law to adjudicate the claims but

applies federal procedural law. See Hall v. GE Plastic Pacific PTE Ltd., 327 F.3d 391, 394

(5th Cir. 2003) (“Federal courts apply state substantive law when adjudicating

diversity-jurisdiction claims, but in doing so apply federal procedural law to the

proceedings.”).1 “Where the state rule reflects a substantive state policy not in conflict with

the plain meaning of the federal rule, then the state rule is the rule of decision and should be

applied under the terms of the Erie decision.” Exxon Corp. v. Burglin, 42 F.3d 948, 949 (5th

Cir. 1995). Federal courts are not bound to follow a state law that is in some sense

“substantive” if it is in conflict with the Federal Rules of Civil Procedure. Burlington N.R.

1 The state-law claims in this case are present under supplemental jurisdiction, 28
U.S.C. § 1367, and not diversity jurisdiction. However, the same procedure-substance
analysis applies. See, e.g., Garza v. Scott and White Memorial Hospital, 234 F.R.D. 617, 621
n.1 (W.D. Tex. 2005).

Co. v. Woods, 480 U.S. 1, 4, 107 S.Ct. 967, 94 L.Ed.2d 1 (1987). If, when “fairly

construed,” a particular federal statute or rule is sufficiently broad to cause a “direct

collision” with the relevant provision of state law, federal law preempts the operation of the

state law. Id. at 4-5, 107 S.Ct. 967; see also Exxon, 42 F.3d at 950 (“If the [federal] rule

speaks to the point in dispute and is valid, it is controlling, and no regard need be paid to

contrary state provisions.”).

Texas’s expert report requirements, as found in Section 74.351, do not apply in federal

court. See, e.g., Poindexter v. Bonsukan, 145 F.Supp.2d 800 (E.D. Tex. 2001) (concluding

that federal rules of civil procedure apply to expert reports, not Texas rules, because there

is a direct collision between Section 74.351 and Federal Rules 26 and 37); Garza, 234 F.R.D.

at 622; Brown v. Brooks County Det. Ctr., Civ. A. Nos. C-04-329, C-04-375, 2005 WL

1515466 (S.D. Tex. June 23, 2005); Nelson v. Myrick, Civ. A. No. G:04-0828, 2005 WL

723459 (N.D. Tex. Mar. 29, 2005); McDaniel v. United States, Civ. A. No. SA-04-CA-0314,

2004 WL 2616305 (W.D. Tex. Nov. 16, 2004); but see Cruz v. Chang, 400 F.Supp.2d 906

(W.D.Tex. 2005) (the service of expert reports required by section 74.351 “is not displaced

by federal rule and is . . . [a] part of a comprehensive scheme governing plaintiff’s substantive

right”). The Federal Rules of Civil Procedure apply to determine whether Dr. Varon’s expert

report is sufficient.

Rule 26(a)(2) of the Federal Rules of Civil Procedure provides that “a party must

disclose to other parties the identity of any witness it may use at trial to present evidence

under Federal Rules of Evidence 702, 703, or 705.” FED. R. CIV. P. 26(a)(2). Rule

26(a)(2)(B) requires that “this disclosure must be accompanied by a written report – prepared

and signed by the witness – if the witness is one retained or specially employed to provide

expert testimony in the case or one whose duties as the party’s employee regularly involve

giving expert testimony.” The Rule sets out the requirements for the contents of the report:

(I) a complete statement of all opinions the witness will express and the basis
and reasons for them;

(ii) the data or other information considered by the witness in forming them;

(iii) any exhibits that will be used to summarize or support them;

(iv) the witness’s qualifications, including a list of all publications authored in
the previous 10 years;

(v) a list of all other cases in which, during the previous four years, the witness
testified as an expert at trial or by deposition; and

(vi) a statement of the compensation to be paid for the study and testimony in
the case.

FED. R. CIV. P. 26(a)(2)(B). The purpose is “to provide information on expert testimony

sufficiently in advance of trial [so] that opposing parties have a reasonable opportunity to

prepare for effective cross examination and perhaps arrange for expert testimony from other

witnesses.” FED. R. CIV. P. 26 Advisory Committee’s Note (1993 Amendments). When a

party fails to comply with the requirements of Rule 26, the court may exclude the witness or

report as evidence at trial, at a hearing, or on a motion, and may “impose other appropriate

sanctions.” FED.R.CIV.P. 37(c)(1).

The admissibility of expert testimony in federal court is governed by Federal Rule of

Evidence Rule 702. Edwards v. Sears, Roebuck and Co., 512 F.2d 276, 292 (5th Cir. 1975);

see also Advocare Intern. L.P. v. Horizon Laboratories, Inc., Civ. A. No. 3:04-cv-1988-H,

2006 WL 176573, at *1 (N.D. Tex. Jan. 24, 2006) (decisions of Texas state courts are

inapposite because “the admissibility of expert testimony in a federal trial is governed by

federal law”); 29 C. WRIGHT & V. GOLD, FEDERAL PRACTICE & PROCEDURE § 6263 (“Rule

702 governs the admissibility of expert witness testimony even in cases where state

substantive law controls under Erie.”). Rule 702 states that “[i]f scientific, technical, or other

specialized knowledge will assist the trier of fact to understand the evidence or to determine

a fact in issue, a witness qualified as an expert by knowledge, skill, experience, training, or

education, may testify thereto in the form of an opinion or otherwise, if (1) the testimony is

based upon sufficient facts or data, (2) the testimony is the product of reliable principles and

methods, and (3) the witness has applied the principles and methods reliably to the facts of

the case.” As a threshold matter, the trial judge must determine whether the proffered

witness is qualified to give the expert opinion he seeks to express. Kumho Tire Co. v.

Carmichael, 526 U.S. 137, 156, 119 S.Ct. 1167, 143 L.Ed.2d 238 (1999); Daubert v. Merrell

Dow Pharms., Inc., 509 U.S. 579, 588, 113 S.Ct. 2786, 125 L.Ed.2d 469 (1993). Witnesses

may be qualified as experts if they possess specialized knowledge, skill, experience, training,

or education. FED. R. EVID. 702. The standard for qualifying expert witnesses is fairly

liberal; the witness need not have specialized expertise in the area directly pertinent to the

issue in question if the witness has qualifications in the general field related to the subject

matter in question. 4 JACK B. WEINSTEIN & MARGARET A. BERGER, WEINSTEIN’S FEDERAL

EVIDENCE § 702.04(1)(a) (Joseph M. McLaughlin, ed., 2d ed. 2005); see also United States

v. Marler, 614 F.2d 47, 50 (5th Cir. 1980). The court must determine whether the proposed

expert’s training or experience are sufficiently related to the issues and evidence before the

court that the expert’s testimony will assist the trier of fact. Primrose Operating Co. v. Nat’l

Am. Ins., 382 F.3d 546, 562-63 (5th Cir. 2004).

The burden is on the party offering the expert testimony to establish by a

preponderance of the evidence that it is admissible. Moore v. Ashland Chem., Inc., 151 F.3d

269, 276 (5th Cir.1998) (en banc). The district court must make a “preliminary assessment

of whether the reasoning or methodology underlying the testimony is scientifically valid [the

reliability criterion] and of whether the reasoning or methodology can be applied to the facts

at issue [the relevance analysis].” Skidmore v. Precision Printing & Packaging, Inc., 188

F.3d 606, 617 (5th Cir.1999) (quoting Daubert, 509 U.S. at 592-93, 113 S.Ct. 2786). The

district court’s responsibility is “to make certain that an expert, whether basing testimony

upon professional studies or personal experience, employs in the courtroom the same level

of intellectual rigor that characterizes the practice of an expert in the relevant field.” Kumho

Tire, 526 U.S. at 152, 119 S.Ct. 1167. The court “must ensure the expert uses reliable

methods to reach his opinions; and those opinions must be relevant to the facts of the case.”

Guy v. Crown Equip. Corp., 394 F.3d 320, 325 (5th Cir. 2004). In making its reliability

determination, the court should not decide the validity of the expert’s conclusions, but instead

consider the soundness of the general principles or reasoning on which the expert relies and

the propriety of the methodology that applies those principles to the facts of the case.

Daubert, 509 U.S. at 594-95, 113 S.Ct. 2786; Watkins v. Telsmith, Inc., 121 F.3d 984, 989

(5th Cir. 1997); Brumley v. Pfizer, Inc., 200 F.R.D. 596, 600 (S.D. Tex. 2001).

Analysis

Dr. Varon’s report meets some, but not all, of the Rule 26(a)(2) requirements. The

report sets forth his qualifications, a complete statement of all his opinions, the basis and the

reasons for those opinions (the standards of care and the reasons Dr. Varon believed those

standards were breached), and the data considered in forming the opinions (including Tristan

Guzman’s medical records, depositions, laboratory data). There is no evidence in the record

that the defendants have been provided with a list of Dr. Varon’s publications, a list of other

cases in which he has testified as an expert, or his compensation in this case. However,

Guzman may supplement Dr. Varon’s report under Rule 26(e)(2) to include this information.

Dr. Haynes and Memorial Hermann argue that Dr. Varon is not qualified to testify

about the standard of care in emergency medicine. Memorial Hermann also argues that Dr.

Varon is not qualified to testify about the standard of care for laboratory technicians

transmitting test results or about hospital policies and procedures on communicating

laboratory results to physicians and patients. Dr. Haynes and Memorial Hermann contend

that Dr. Varon’s report is deficient because it does not sufficiently define the applicable

standard of care and gives conclusory opinions on causation.

Dr. Varon is qualified under Rule 702 to testify about the standard of care in

emergency medicine. Dr. Varon is a board certified physician in internal medicine with

subspecialties in pulmonary medicine and critical care medicine. He is currently licensed to

practice medicine in the state of Texas and is on the active medical staff at St. Luke’s

Episcopal Hospital in Houston, Texas. He treats roughly 10 patients a day who have

bacteremia or sepsis. Over the course of his career, he has treated thousands of patients with

sepsis. Dr. Varon also serves as one of the attending physicians for St. Luke’s emergency

room patients whose primary doctor does not have medical staff privileges at St. Luke’s. In

that capacity, he works in the emergency department on a daily basis. Dr. Varon has medical

staff privileges at several hospitals in the Houston, Texas area and in other cities. He served

as a staff emergency medicine physician at Methodist Hospital in Houston, Texas from 1995

to 2001. Dr. Varon is currently an editor of the Journal of Emergency Medicine in the field

of critical care medicine. He has published several papers and book chapters concerning the

evaluation and treatment of patients with sepsis. Dr. Varon has given numerous

presentations and lectures concerning emergency medicine and sepsis, the matters at issue

in this case.

With respect to laboratory testing, Dr. Varon’s report states that he is “familiar with

the manner in which laboratories in hospitals interact with the emergency departments of

hospitals and provide results to the physicians and nurses in the emergency department.”

(Docket Entry No. 20, Ex. A). He has medical staff privileges at Memorial Hermann. As

a result, he is “familiar with in the manner in which the Memorial Hermann [laboratory]

system works” and familiar with “the computerized hospital information system at Memorial

Hermann.” (Docket Entry No. 39). Given his experience working in hospital emergency

departments and communicating with laboratory technicians, Dr. Varon is qualified to testify

regarding the standard of care for communicating laboratory test results to emergency room

doctors and the standard of care for hospital policies and procedures regarding

communicating laboratory results to patients.

Dr. Varon’s expert opinion is admissible under Rule 702. The defendants do not

challenge his methodology. Dr. Varon reviewed Tristan Guzman’s medical records, an MRI

report, and the neuropsychological report by Kevin Krull, Ph.D., at Texas Children’s

Hospital. He also reviewed the depositions of Dr. Haynes, Frank Blain, R.N., April Ganz,

R.N., Suzette Dalmeida, and Wendy Guzman. Dr. Varon based his opinion on his review

of these materials and his training and experience. The defendants’ motions challenging Dr.

Varon and seeking to exclude Dr. Varon’s testimony and to dismiss the state-law negligence

claims are denied.

IV. Conclusion

ECI’s motion to dismiss for lack of personal jurisdiction is granted. ECI’s motions

to dismiss Guzman’s claims as barred by limitations and to dismiss Guzman’s single business

enterprise claim are denied as moot. Dr. Haynes’s motion challenging Guzman’s expert

report is denied. Memorial Hermann’s motion to dismiss Guzman’s state-law claims for

failing to comply with the Texas rule on expert reports is denied.

SIGNED on December 17, 2008, at Houston, Texas.

______________________________________
Lee H. Rosenthal
United States District Judge