Antoine Adem, M.D. v. Des Peres Hospital, Inc. ( 2017 )

In the Missouri Court of Appeals
Eastern District
DIVISION TWO
ANTOINE ADEM M.D., ) No. ED104191
)
Appellant, )
) Appeal from the Circuit Court
) of St. Louis County
vs. ) Cause No. 15SL-CC03107
)
DES PERES HOSPITAL, INC., ) Honorable Ellen H. Ribaudo
)
Respondent. ) Filed: January 24, 2017
I. Introduction
Antoine Adem, M.D. (“Appellant”) appeals the motion court’s dismissal of his claims for
injunctive relief, temporary restraining order, and declaratory judgment against Des Peres
Hospital, Inc. (“the Hospital”). Appellant claims the court erred in finding he did not allege
sufficient facts demonstrating the Hospital failed to substantially comply with its bylaws (“the
Bylaws”) by failing to follow certain procedural safeguards in conducting his peer review
proceedings. Appellant’s staff membership and clinical privileges were revoked by the Board of
the Hospital (“the Board”) following the recommendations of the Medical Executive Committee
(“Executive Committee”) and the Medical Review Committee (“Review Committee”). 1
1
After Appellant filed his petition an Appellate Review Committee reviewed the joint recommendation of the
Executive Committee and the Review Committee to revoke Appellant’s privileges. This third committee did not
contain any members who had been involved earlier in the peer review process or served on either of the other
1
As an initial matter, our Court must determine whether there is a final judgment sua
sponte. Avery Contr., LLC v. Niehaus, 492 S.W.3d 159, 162 (Mo. banc 2016). The motion
court’s order and judgment did not specify whether it dismissed Appellant’s claims with or
without prejudice. If a motion to dismiss does not specifically state it is dismissed with prejudice,
it is deemed to be dismissed without prejudice. See Meissner v. Schnettgoecke, 427 S.W.3d 864,
866 n.2 (Mo. App. E.D. 2014); see also Rule 67.03. 2 Typically, following a dismissal without
prejudice, a plaintiff can cure the dismissal by filing another suit in the same court. Meissner,
427 S.W.3d at 866 n.2. Therefore, a dismissal without prejudice is generally not a final,
appealable judgment. Jennings v. SSM Health Care St. Louis, 355 S.W.3d 526, 530-31 (Mo.
banc 2011).
“However, a party can appeal from a dismissal without prejudice if the dismissal has the
practical effect of terminating the action.” L.C. Dev. Co. Inc. v. Lincoln Cty, 26 S.W.3d 336, 338
(Mo. App. E.D. 2000); Avery Contr., 492 S.W.3d at 162. The motion court granted the
Hospital’s combined motion to dismiss Appellant’s claims based on his failure to state a claim
upon which relief could be granted. The Supreme Court of Missouri has held “where the trial
court dismisses a petition without prejudice for failure to state a claim, and the plaintiff elects to
stand on the dismissed petition and not to plead further, then that dismissal effectively bars the
plaintiff from re-filing the action in its original form.” Jennings, 355 S.W.3d at 531.
Consequently, the motion court’s dismissal has the practical effect of a final judgment, and
appellate courts have jurisdiction over such appeals. Id.
committees, and also unanimously recommended the Board revoke Appellant’s privileges. This Court is not
considering the decision of the Appellate Review Committee, as it is a matter outside of the pleadings.
2
All references are to Missouri Supreme Court Rules 2015.
2
II. Factual and Procedural Background
Appellant is a cardiologist who was a member of the Hospital’s medical staff. On March
21, 2014, the Hospital’s Chief of Staff notified Appellant that the Executive Committee had
recommended that Appellant’s medical staff privileges be revoked in accordance with the
Bylaws. Following this adverse recommendation, Appellant invoked his right to a hearing by the
Review Committee and was served with notice of the hearing on June 2, 2015. This notice letter
included the names of the three medical staff members who would review the Executive
Committee’s recommendation. Section 11.6 of the Bylaws outlines the requirements for
selecting the Review Committee and states that the doctors serving on the Review Committee
cannot be in economic competition with Appellant and cannot have been involved earlier in the
peer review process. This section also requires that the Chief of Staff appoint members of the
Review Committee and “[i]f available, at least one [Review Committee] member shall have
practice experience, education or training the same or sufficiently similar to the practice area of
the Physician…under review.” § 11.6. Appellant objected that none of the appointed physicians
practiced cardiology and therefore lacked sufficiently similar experience as required by the
Bylaws. His objection was overruled by the Hospital and the Review Committee hearing was
held from August 4-6th, 2015.
Appellant asserted in his pleadings that on or about September 3, 2015, he learned one of
the Review Committee members, Dr. Soudah, was an employee of Tenet, a publicly traded for-
profit corporation that wholly owns the Hospital. Appellant pleaded that this raised a conflict of
interest and violated the Bylaw’s impartiality requirement. This objection was made three
months after Appellant received notice of the hearing. The Hospital denied the objection because
3
it was not made within ten days after receiving notice of the hearing as provided by the Bylaws
and was therefore waived.
On September 11, 2015, Appellant filed a lawsuit in St. Louis County seeking a
temporary restraining order, preliminary and permanent injunctions, and a declaratory judgment
that the Hospital had failed to substantially comply with its Bylaws. Appellant alleged that the
Hospital failed to comply with the Bylaws in two express ways: (1) failing to select impartial
panel members to sit on the Review Committee; and (2) failing to select any panel member who
had sufficiently similar experience to Appellant. On September 25, 2016, the motion court
granted the Hospital’s motion to dismiss for failure to state a claim, finding that Appellant failed
to plead sufficient facts which, if true, demonstrated that the Hospital did not substantially
comply with its Bylaws. This appeal follows.
III. Standard of Review
“Where the pleadings fail to state a cause of action under the law or fail to state facts
entitling the party to relief, the trial court may dismiss the lawsuit.” ITT Commercial Fin. Corp.
v. Mid-America Marine Supply Corp., 854 S.W.2d 371, 376 (Mo. banc 1993). “Missouri rules of
civil procedure demand more than mere conclusions that the pleader alleges without supporting
facts.” Transit Cas. Co. ex rel. Pulitzer Publ’g Co. v. Transit Cas. Co. ex rel. Intervening
Employees, 43 S.W.3d 293, 302 (Mo. banc 2001) (citing Rule 55.05). Missouri is a fact-pleading
state and every petition must contain facts that sufficiently demonstrate the pleader is entitled to
the relief sought. ITT, 854 S.W.2d at 379. “A petition must contain allegations of fact in support
of each essential element of the cause sought to be pleaded.” Sparks v. PNC Bank, 400 S.W.3d
454, 460 (Mo. App. E.D. 2013). This Court disregards all conclusions in a petition when they are
4
not supported by facts. Zafer Chiropractic & Sports Injuries, P.A. v. Hermann, 2016 Mo. App.
LEXIS 1020, *5 (Mo. App. E.D. October 18, 2016).
An appellate court “reviews the grant of a motion to dismiss de novo.” Byrne & Jones
Enters. v. Monroe City R-1 Sch. Dist., 493 S.W.3d 847, 851 (Mo. banc 2016). “Appellate review
of the trial court’s dismissal for failing to state a cause of action is solely a test of the adequacy
of the plaintiff’s petition.” Egan v. St. Anthony’s Med. Ctr., 244 S.W.3d 169, 171 (Mo. banc
2008) (Egan I) (internal quotations omitted). We assume all averments from the petition are true
and liberally grant all reasonable inferences in the plaintiff’s favor. Gardner v. Bank of Am.,
N.A., 466 S.W.3d 642, 646 (Mo. App. E.D. 2015). In reviewing the grant of a motion to dismiss,
“we review the petition in an almost academic manner to determine if the facts alleged meet the
elements of a recognized cause of action, or of a cause that might be adopted in that case.” Id.
(citing Nazeri v. Mo. Valley College, 860 S.W.2d 303, 306 (Mo. banc 1993)).
In Egan I, the Supreme Court of Missouri held “an aggrieved member of the medical
staff, may bring an action in equity for injunctive relief to compel the hospital to substantially
comply with its own bylaws before his privileges may be revoked.” 244 S.W.3d at 174. The
Court went on to emphasize:
[T]he purpose of [19 CSR 30-20.021(2)(C)1-5] 3 is to implement a system of
medical staff peer review, rather than judicial oversight, and it is clear that final
authority to make staffing decisions is securely vested in the hospital’s governing
body with advice from the medical staff.
Id. (citing 19 CSR 30-20.021(2)(C)12).
3
This regulation requires hospitals to adopt bylaws to govern the professional activity of medical staff members,
including bylaws for hearing and appealing a denial or revocation of staff privileges. Ralph v. St. Anthony’s Med.
Ctr., 470 S.W.3d 783, 786 (Mo. App. E.D. 2015). “[I]t is implicit under this regulation that hospitals not only have a
legal duty to adopt bylaws, but also a corresponding duty to abide by those bylaws.” Id. (quoting Egan I, 244
S.W.3d at 173).
5
Egan I held that appellate courts “will not impose judicial review on the merits of a
hospital’s staffing decisions, but will act only to ensure substantial compliance with the
hospital’s bylaws” and remanded the case to the trial court to make that determination. Id. The
trial court found the hospital had substantially complied with the bylaws and denied Dr. Egan’s
request for injunctive relief; Dr. Egan then appealed the ruling to our Court a second time. Egan
v. St. Anthony’s Med. Ctr., 291 S.W.3d 751, 754 (Mo. App. E.D. 2009) (Egan II).
On appeal, this Court defined the proper standard for evaluating “substantial
compliance.” Id. at 759-60. First, an adversely affected member of the medical staff must
demonstrate “that the hospital actually violated an express requirement of the bylaws.” Id. at
759. Second, a court must determine whether the alleged violation was one of “basic procedural
protections such as notice, hearing, and appeal procedures.” Id. at 760. A “hospital’s ‘technical’
violations or minor irregularities in procedural compliance will generally not constitute a failure
of substantial compliance.” Id. Additionally, “violations of hospital bylaws that, when looking at
the proceedings as a whole, do not result in material prejudice to the physician or otherwise
undermine the result reached by the hospital do not fall below the standard of substantial
compliance or warrant equitable relief.” Id. (internal quotations omitted). Judicial review of a
hospital’s staffing decisions is thus narrowly limited to express and material procedural
violations of a hospital’s bylaws. Id. at 759-60. “[I]f a hospital substantially complies with its
bylaws, the adversely affected medical staff member is not entitled to equitable relief and a
reviewing court may not reweigh the evidence or interfere with the hospital’s decision on the
merits.” Id. at 760.
6
IV. Discussion
a. The motion court did not err in holding Appellant failed to allege sufficient
facts to show the appointment of Dr. Soudah constituted an express, material,
procedural violation of the Bylaws.
i. Dr. Soudah’s appointment did not violate the Bylaws.
In his first point on appeal, Appellant claims the Hospital violated the Bylaws by
appointing a biased member, Dr. Soudah, to the Review Committee. Appellant alleges Dr.
Soudah is an employee of Tenet, the corporation that owns the Hospital, and there was an
“obvious” conflict of interest because Tenet was “adverse” to Appellant. 4 Appellant asserted that
because Dr. Soudah was an employee of the Hospital’s parent company he had a presumptive
conflict of interest that violated the requirement of impartiality. In reviewing the petition and the
attached Bylaws, the court found that Appellant’s challenge to the appointment of Dr. Soudah
was untimely and was therefore waived. This Court’s review is limited solely to a determination
of whether Appellant’s petition was adequate. Egan I, 244 S.W.3d at 171. We assume all
reasonable inferences from the petition are true. Id. The motion court’s order and judgment
likewise assumed all of Appellant’s averments were true, and it liberally granted him all
reasonable inferences therefrom. The motion court was free to examine the Bylaws because
Appellant attached a copy as an exhibit to his petition. See Hendricks v. Curators of Univ. of
Missouri, 308 S.W.3d 740, 747 (Mo. App. W.D. 2010) (citing Rule 55.12). 5
In Missouri, “a private hospital’s decisions regarding staff privileges are not subject to
judicial oversight.” Egan I, 244 S.W.3d at 171 (citing Cowan v. Gibson, 392 S.W.2d 307, 309
4
Respondent accepted Appellant’s allegation that Dr. Soudah is employed by Tenet and Tenet wholly owns the
Hospital. However, Respondent noted in their brief that Dr. Soudah is actually employed by Premier Medical
Specialists, LLC, which is an affiliate of Tenet.
5
Under Rule 55.12 of the Missouri Rules of Civil Procedure, “[a]n exhibit to a pleading is a part thereof for all
purposes.”
7
(Mo. banc 1965)). In Egan I, the Missouri Supreme Court set out a limited exception to this
“general rule of non-review”: a doctor may bring a claim in equity for injunctive relief by asking
the court to compel a hospital to substantially comply with its bylaws before the hospital may
revoke the physician’s privileges. Egan I, 244 S.W.3d at 172-74. In order to establish a hospital
did not substantially comply with its bylaws, an aggrieved doctor must demonstrate (1) there was
an express procedural violation of the bylaws, and (2) this violation was material and not merely
a technical violation. Egan II, 291 S.W.3d at 759-60.
Appellant pleaded Dr. Soudah’s employment created an “obvious” conflict of interest
that violated § 11.6 of the Bylaws, which requires that all members of the Review Committee
“shall be impartial and shall not have acted as accusers, investigators, fact-finders or initial
decision makers in connection with the same matter[.]” The Bylaws do not expressly state a
physician who is employed by a parent company or affiliated practice group fails the impartiality
requirement in § 11.6 or is unable to serve on a peer review committee. In fact § 6.6 states staff
members who “provide professional services at the Hospital pursuant to an exclusive contract
arrangement…shall fulfill all of the obligations for Medical Staff membership and Clinical
Privileges as any other applicant or member.” Under § 8.1.1(b) all members of the Medical Staff
must “participate in Peer Review activity as requested by the Chief of Staff or appointed
designee[.]” This is echoed in § 6.2.8, which requires physicians to participate and cooperate
with peer review activity in order to maintain their clinical privileges. Finally, § 5.8.8 states
medical staff physicians “agree to serve on committees of the Medical Staff when so appointed
by the Chief of Staff.” It is clear that under the Bylaws, all physicians are expected to serve on
peer review committees, including those under contract with the Hospital. Adopting Appellant’s
interpretation of the Bylaws to categorically prevent any physician employed by the Hospital or
8
Tenet to serve on the Review Committee would be inconsistent with other provisions in the
Bylaws.
Appellant alleged that Dr. Soudah was “obviously” biased because he was employed by
Tenet and Dr. Soudah knew which side his employer “wanted to win.” However, Appellant did
not allege any facts in his petition demonstrating the Hospital or Tenet wanted a particular
outcome from his peer review process. Appellant’s averment is a conclusory statement that does
not meet the fact-pleading requirements of Missouri. Gardner, 466 S.W.3d at 646 (“The petition
may not merely assert conclusions, and in determining whether a petition states a cause of action,
we are to disregard conclusions not supported by facts.”).
In Egan I and Egan II, the appellant, Dr. Egan, alleged his peer review was biased and
therefore violated the hospital’s bylaws. Egan II, 291 S.W.3d at 762. In Egan I, the Missouri
Supreme Court adopted a limited exception to the general rule of non-review of private
hospitals’ staffing decisions, which applies when a hospital fails to substantially comply with its
own bylaws. 244 S.W.3d at 173-74. The Court held “the matter of substantial compliance is a
factual dispute that can only be determined [by the trial court] on remand.” Id. at 174.
Accordingly, it reversed the judgment and remanded the case to the trial court to determine
whether the hospital failed to substantially comply with its bylaws when it permanently
suspended Dr. Egan. Id.
In Egan II, the trial court considered evidence from Dr. Egan and the hospital regarding
the revocation of his privileges. Id. Dr. Egan claimed two committee members were biased
against him and the appellate review committee improperly considered evidence outside the
record in violation of the bylaws. 6 Id. at 761-62. The trial court found the hospital substantially
6
As evidence of bias, Dr. Egan referred to a statement to the board from one of the Appellate Review Committee
members alleging that two of the panel members made personal observations to the panel about Dr. Egan’s
9
complied with its own bylaws and “there was substantive procedural fairness at every step in the
process.” Id. at 757. We affirmed the trial court’s determination that there was insufficient
evidence to demonstrate the hospital failed to substantially comply with its bylaws. Id. at 765.
In the present case, the motion court held Appellant’s allegations failed to demonstrate
that the Hospital did not substantially comply with its Bylaws. We agree that Appellant’s
pleadings failed to allege sufficient facts demonstrating the Hospital committed an express,
material, procedural violation of the Bylaws as contemplated by Egan II. Id. at 759-60. Such a
showing was necessary to demonstrate the Hospital did not substantially comply with its Bylaws,
which is the sole exception to the rule of non-review of hospital staffing decisions in Missouri.
Id.; see also Egan I, 244 S.W.3d at 174.
ii. The motion court did not err in finding Appellant waived his objection
to Dr. Soudah’s appointment under the Bylaws.
Section 11.4 of the Bylaws outlines the procedural requirements the Hospital must follow
when an affected physician has made a proper request for a Review Committee. It states that the
Hospital must provide notice of the hearing and identify the selected members of the Review
Committee. § 11.4.1. The Hospital must give the affected physician ten days to object to any of
the selected members to the Chief of Staff in writing. Id. If the physician fails to object within
ten days then they will be deemed to have irrevocably waived the right to object to any Review
Committee member. Id. Appellant failed to allege facts establishing the Hospital’s non-
compliance with these procedural requirements. In his petition, Appellant conceded he did not
object to the appointment of Dr. Soudah until three months after receiving notice of who would
serve on the Review Committee. Accordingly, the motion court, looking solely at the procedural
professional judgment and mental deficiencies. Id. at 762. This statement also included allegations that one of the
panelists “introduced his own oral testimony regarding Dr. Egan’s professional conduct.” Id. at 761.
10
requirements of the Bylaws, ruled that Appellant did not timely object to the appointment of Dr.
Soudah and therefore waived this objection. We agree with the motion court that Appellant
waived the right to object to the appointment of Dr. Soudah.
b. The motion court did not err in holding Appellant failed to allege sufficient
facts demonstrating the Hospital did not substantially comply with the Bylaws.
The Hospital appointed three non-cardiologists to the Review Committee: a general
surgeon, an internist, and an endocrinologist. In his petition, Appellant claimed he timely
objected that none of these physicians had sufficiently similar experience, education or training
to his own, as required by § 11.6 of the Bylaws. Section 11.6 states: “If available, at least one
Review Committee member shall have practice experience, education or training the same or
sufficiently similar to the practice area of the Physician…under review.” On appeal, Appellant
argues that the Hospital expressly violated this provision, and the motion court erred by engaging
in fact-finding instead of assuming the allegations in Appellant’s petition were true.
The Hospital first responds that a review of this decision would require the court to
review the merits of the Hospital’s medical staff’s decision and is barred under the rule of non-
review. Second, the Hospital argues that even if all three physicians lacked sufficiently similar
experience to Appellant, the Bylaws would only be violated if such a physician was available,
which Appellant was required to allege but failed to do. Finally, the Hospital argues that it
complied with the Bylaws by appointing physicians that had sufficiently similar training and
experience. We will address the Hospital’s first point only, because we find it dispositive.
Therefore, we do not reach the merits of the Hospital’s second two points.
Requiring courts to determine whether a physician has “sufficiently similar” experience
as the affected physician would violate Missouri’s rule of non-review. See Egan I, 244 S.W.3d at
174. The Supreme Court of Missouri explained in Egan I:
11
[I]t must be emphasized that the purpose of the regulation 7 is to implement a system
of medical staff peer review, rather than judicial oversight, and it is clear that final
authority to make staffing decisions is securely vested in the hospital’s governing
body with advice from the medical staff. This is so because the notion underlying
the internal governance structure required by the regulatory scheme is that medical
professionals are best qualified to police themselves…This Court, then, will not
impose judicial review on the merits of a hospital’s staffing decisions, but will act
only to ensure substantial compliance with the hospital’s bylaws.
244 S.W.3d at 174 (emphasis added).
The sole exception to the rule of non-review is that a reviewing court may determine
whether a hospital complied with the basic procedural protections of its bylaws without
reviewing the merits of a hospital’s staffing decision. Egan II, 291 S.W.3d at 759-60. Under the
Bylaws, the Chief of Staff is responsible for appointing physicians to the Review Committee
with sufficiently similar experience as the affected physician. § 11.6. The Chief of Staff is also
responsible for resolving all objections to the appointment of any individual to the Review
Committee, in consultation with the Chief Executive Officer. § 11.4.1. Selecting physicians to
serve on a peer review committee who have sufficiently similar experience as the affected
physician is a determination best made by medical professionals. See Egan II, 291 S.W.3d at 760
(explaining that courts should be reluctant to “substitute their judgment for the superior
professional judgment of hospital officials in evaluating hospital staff decisions.”).
The Missouri Supreme Court stated a private hospital makes all final staffing decisions
with advice from its medical staff which “as a body or through committee shall review and
evaluate the quality of clinical practice of the medical staff in the hospital[.]” Egan I, 244 S.W.3d
at 174 (quoting 19 CSR 30-20.021(2)(C)12). Reviewing the selection process for which doctors
are qualified to serve on peer review committees inevitably would involve a review of the Chief
7
Referencing 19 CSR 30-20.021(2)(C)1-5 which requires hospitals adopt bylaws to govern the professional activity
of medical staff members, including bylaws for hearing and appealing a denial or revocation of staff privileges.
Egan I, 244 S.W.3d at 174.
12
of Staff’s decisions, the peer review committee’s subsequent recommendation, and ultimately the
merits of the hospital’s staffing decision. See Egan I, 244 S.W.3d at 174; See Egan II, 291
S.W.3d at 760. Such a determination falls outside the exception to the rule of non-review, which
is solely a review of whether a hospital substantially complied with its own bylaws before
revoking a staff member’s privileges. Id.
V. Conclusion
For the foregoing reasons, the judgment of the motion court is affirmed.
_______________________________
Colleen Dolan, Judge
Sherri B. Sullivan, P.J., concurs.
Roy L. Richter, J., concurs.
13