Murtagh v. St. Mary’s Reg’l Health Ctr. (Summary)

DUE PROCESS/ DEFAMATION

Murtagh v. St. Mary’s Reg’l Health Ctr., No. 1:12-CV-00160-NT (D. Me. Sept. 23, 2013)

The United States District Court for the District of Maine granted in part and denied in part a medical center’s motion to dismiss a physician’s claims of breach of contract, defamation and wrongful termination. The physician was hired as a locum tenens physician for a three-month position, but was terminated after only three weeks, pursuant to the contract between the medical center and its staffing agency which provided the medical center authority to remove from assignment any physician whose performance is reasonably found to be unacceptable for reasons of professional competence or personal conduct.  The medical center later gave a reference indicating that the physician had been terminated for unsatisfactory performance.

The district court rejected the physician’s argument that he was entitled to due process before being terminated from the medical staff since the bylaws provide such process for permanent physicians and, as a locum tenens, he was standing in the shoes of a permanent physician.  The court noted that the bylaws specifically stated that due process rights were not available to those who lose temporary privileges and dismissed the breach of contract claim.  The court also rejected the physician’s argument that he was a third party beneficiary of the contract between the medical center and the staffing agency and was entitled to some sort of notice prior to termination.  That contract specifically stated the procedures for the medical center to remove a physician from placement at the medical center and merely required notice to be given to the staffing agency, not the physician.

The court did not dismiss all of the physician’s claims.  First, the court held that the physician’s defamation claim would survive the motion to dismiss because the physician alleged sufficient facts to support such a claim (that a negative reference, which would tend to harm his professional reputation and was false, was published to third parties).  The court also allowed the physician’s claim for violation of a state employment practices statute to move forward, finding a question of fact existed as to whether the physician was an independent contractor or employee pursuant to state law (regardless of the fact that the contract stated that he was an independent contractor).