Cole v. Jersey City Med. Ctr. (Summary)

TERMINATION OF EMPLOYMENT

Cole v. Jersey City Med. Ctr., A-6-12; 070542 (N.J. Aug. 14, 2013)

The Supreme Court of New Jersey affirmed a lower court’s decision finding that an anesthesia group with an exclusive contract to provide anesthesia services at a hospital waived its right to arbitrate during the course of litigation involving one of its employed certified registered nurse anesthetists (“CRNA”).

A hospital suspended the privileges of the CRNA, an employee of the anesthesia group, after certain improprieties in her drug accounting practices were discovered.  As a result, the anesthesia group terminated her employment.  The CRNA sued the hospital and the hospital brought the anesthesia group into the lawsuit as a third-party defendant.  The hospital ultimately settled and the anesthesia group was granted summary judgment on two of the four remaining causes of action.  Three days before the trial on the remaining claims was set to commence, and 21 months after the initiation of the lawsuit, the anesthesia group sought to invoke the arbitration clause that was in the CRNA’s employment contract with the group.

The court found that a 21-month delay was substantial, especially since the anesthesia provider failed to notify the former employee of its intent to seek arbitration. Furthermore, the court found that, as the motion to compel arbitration occurred a mere three days before the scheduled trial date, this had a detrimental impact on the litigation process because the parties had invested considerable time in the lawsuit and the referral to arbitration delayed the resolution of the case, forcing the former employee to start over in a different forum under different rules.