Cohlmia v. St. John’s Medical Center (Summary)

HCQIA – ATTORNEYS’ FEES

Cohlmia v. St. John Med. Ctr., No. 12-5188 (10th Cir. Apr. 21, 2014)

The United States Court of Appeals for the Tenth Circuit affirmed an award of over $700,000 in attorneys’ fees to a hospital pursuant to the Health Care Quality Improvement Act (“HCQIA”), in a lawsuit that had been brought by a physician to challenge the suspension of his clinical privileges.

This case arose after a surgeon’s privileges were suspended by a hospital following two serious and unexpected outcomes involving the surgeon’s patients.  The surgeon appealed the suspension internally and it was upheld by the hearing panel, MEC, and Board of the hospital.

The surgeon sued the hospital (and 18 other defendants), alleging eight claims, including:  violation of the federal and state antitrust laws, tortious interference with contract, unlawful attempt to monopolize the market, illegal boycott, discrimination on the basis of the surgeon’s affiliation with Native American patients, intentional infliction of emotional distress, and defamation.  Five of those claims were dismissed early in the litigation, while the remaining three claims proceeded to discovery, resulting in the hospital and other defendants producing over 150,000 documents.  Following discovery, the lower court noted that the surgeon produced no evidence to support his claims of antitrust violations and, in turn, granted summary judgment on the basis of immunity under the HCQIA.

The court awarded $732,668 in attorneys’ fees to the hospital and other defendants on the basis that a number of the surgeon’s claims were frivolous when filed (the five claims dismissed for failure to state a claim).  Further, with respect to the remaining three claims that proceeded through discovery only to be dismissed at the summary judgment phase, the court noted that it had expressed skepticism early on about whether the surgeon would be able to support his antitrust claims, but the surgeon nevertheless pursued those claims and engaged in extensive, costly discovery, ignoring indicators that the case lacked substance.  The circuit court agreed with the findings of the lower court, noting that the surgeon’s suit was “at best – unreasonable and without foundation and – at worst – frivolous and asserted in bad faith.”