chase v. gifford ( 2024 )

SUPERIOR COURT CIVIL DIVISION
Washington Unit Case No. 23-CV-02477
65 State Street
Montpelier VT 05602
802-828-2091
www.vermontjudiciary.org
Derek Chase, MD v. Gifford Medical Center, Inc.
Opinion and Order on Defendant’s Partial Motion to Dismiss
Plaintiff Derek Chase is a physician who was formerly employed by
Defendant Gifford Medical Center, Inc. His employment was terminated, and he
brought this Complaint against Defendant seeking damages and declaratory relief
in connection with his employment and termination. Dr. Chase is represented by
Christina Nolan, Esq., and Heather Ross, Esq. Gifford is represented by Elizabeth
Rattigan, Esq., and Brendan Sage, Esq.
Pending before the Court is Gifford’s partial motion to dismiss. Gifford seeks
dismissal of Plaintiff’s claim asserting intentional infliction of emotional distress
(IIED). Gifford contends that the facts alleged do not rise to level needed to state an
IIED claim. It also moves to dismiss Plaintiff’s claims seeking declaratory relief.
Gifford argues primarily that those claims are moot. Dr. Chase opposes the motion.
Both sides have presented written and oral arguments to the Court. Based on those
submissions, the Court makes the following determinations.
I The Legal Standard
While the United States Supreme Court has relaxed somewhat the standard
for granting motions to dismiss under Fed. R. Civ. P. 12(b)(6), Bell Atlantic Corp. v.
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Twombly, 550 U.S. 544, 560–63 (2007), the Vermont Supreme Court has proceeded
in the opposite direction with regard to motions under Vt. R. Civ. P. 12(b)(6). The
Vermont Supreme Court disfavors motions to dismiss. Ass’n of Haystack Prop.
Owners v. Sprague, 145 Vt. 443, 446–47 (1985) (such motions are to be “rarely
granted”). “Dismissal under Rule 12(b)(6) is proper only when it is beyond doubt
that there exist no facts or circumstances consistent with the complaint that would
entitle Plaintiff to relief.” Bock v. Gold, 2008 VT 81, ¶ 4, 184 Vt. 575, 576 (mem.)
(citing Union Mut. Fire Ins. Co. v. Joerg, 2003 VT 27, ¶ 4, 175 Vt. 196, 198)).
In considering a motion to dismiss, the Court “assume[s] that all factual
allegations pleaded in the complaint are true, accept[s] as true all reasonable
inferences that may be derived from plaintiff’s pleadings, and assume[s] that all
contravening assertions in defendant’s pleadings are false.” Mahoney v. Tara, LLC,
2011 VT 3, ¶ 7, 189 Vt. 557, 559 (mem.) (internal quotation, brackets, and ellipses
omitted). It is not required to accept bald legal conclusions unsupported by any
factual allegations, however. Colby v. Umbrella, Inc., 2008 VT 20, ¶ 10, 184 Vt. 1, 9.
As a consequence, the threshold a plaintiff must meet to satisfy the notice-
pleading standard under Vt. R. Civ .P. 8 is “exceedingly low.” Huntington Ingalls
Indus., Inc. v. Ace Am. Ins. Co., 2022 VT 45, ¶ 40 (citing Bock, 2008 VT 81, ¶ 4, 184
Vt. at 576 (mem.)).
II. Dr. Chase’s Facts
As alleged in the Complaint, the facts are as follows. Dr. Chase is an
orthopedic surgeon who started working at Gifford in 2017. In 2019, he received a
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“glowing medical staff performance evaluation.” His most recent employment
agreement was for a one year, with an automatically renewable term, which could
be terminated without cause on 90 days’ notice. The agreement obligated Gifford to
provide Dr. Chase with professional liability insurance during his employment.
In late 2020, Dr. Chase refused to continue working on a surgical fracture
table that he deemed unsafe, and he raised other patient care and safety concerns
with Gifford. Gifford reacted with hostility. Two weeks later, Gifford threatened to
subject Dr. Chase to a peer review or a performance improvement plan for medical
charts that Gifford falsely claimed were deficient. In June 2021, Dr. Chase
reiterated his patient confidentiality concerns. A week later, he was placed on a
performance improvement plan for being delinquent with medical charts, though
there was, in fact, no tardiness. The following month, he was told that he would be
put on another improvement plan for the same (baseless) reason.
A few months later, Dr. Chase was asked to attend a peer review meeting at
which it was alleged, falsely, that he had failed to write follow-up orders for a
specific patient. He was told he would be subject to yet another improvement plan
as well as “open-ended monitoring of his charts.” Shortly thereafter, Gifford filed a
claim against Dr. Chase with the Vermont Medical Practice Board (the “Board”)
that had no legitimate basis.
Dr. Chase hired legal counsel. Gifford later withdrew the performance
review plan, the peer review, and its complaint with the Board.
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On April 8, 2022, Gifford terminated Dr. Chase’s employment. It threatened
to terminate his liability insurance and suspend his clinical privileges immediately.
To embarrass and humiliate Dr. Chase, Gifford falsely told third parties that he
was “escorted out of the building upon his termination.” Gifford denied him the
ability to transition his patients’ care. These actions caused treatment to be
delayed for Dr. Chase’s patients, who had to be transferred to other facilities, which
made them dissatisfied and upset with Dr. Chase. Gifford also destroyed Dr.
Chase’s personal health records, which were in his office, along with destroying gifts
of appreciation Dr. Chase had received from past patients. All of these acts caused
Dr. Chase substantial emotional upset and damaged his professional reputation.
III. Intentional Infliction of Emotional Distress
Gifford argues that the allegations of the Complaint, even indulging all
inferences in their favor, fall short of the extreme conduct that is necessary to
support an IIED cause of action. Dr. Chase counters that this was no mere
termination. He contends that Gifford’s conduct was extreme and intolerable and
caused him extreme emotional distress.
To survive dismissal of an IIED claim, a plaintiff must allege: “(1) conduct
that is extreme and outrageous; (2) conduct that is intentional or reckless; and (3)
conduct that causes severe emotional distress.” Baptie v. Bruno, 2013 VT 117, ¶ 24,
195 Vt. 308, 318. To satisfy the outrageousness element, the defendant’s behavior
must “surpass the bounds of decency that can be tolerated in a civilized society.”
Fromson v. State, 2004 VT 29, ¶ 15, 176 Vt. 395; see also Restatement (Second) of
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Torts § 46, cmt. d (1965). A plaintiff must also allege that the defendant’s actions
caused him to suffer “distress so severe that no reasonable person could be expected
to endure it.” Baldwin v. Upper Valley Services, Inc., 162 Vt. 51, 57 (1994).
In the specific context of employment, “mere termination of employment will
not support a claim for intentional infliction of emotional distress.” Crump v. P & C
Food Markets, Inc., 154 Vt. 284, 296 (1990); Baldwin v. Upper Valley Servs., Inc.,
162 Vt. 51, 56 (1994). Similarly, conduct that often attends termination of
employment, including “insult, indignities, and annoyances” do not rise to the level
of extreme and outrageous conduct. Denton v. Chittenden Bank, 163 Vt. 62, 66–67
(1994). But, “if the manner of termination evinces circumstances of oppressive
conduct and abuse of a position of authority vis-a-vis plaintiff it may provide
grounds for the tort action.” Crump, 154 Vt. 296. Lastly, a plaintiff may not bundle
together separate acts to increase by multiplication the level of the alleged
misconduct. There must be at least one incident that “transcends the ignoble and
vast realm of unpleasant and often stressful conduct in the workplace.” Fromson,
2004 VT 29, ¶ 15, 176 Vt. at 400.
Here, while Dr. Chase alleges various alleged wrongful acts towards him over
time, the Court’s focus is on a single event, his termination. In that regard, Dr.
Chase claims that his termination was augmented by the highly outrageous
additional conduct of Gifford, which included:
● Telling him he was immediately banned from the hospital;
● Telling him he could not coordinate the transfer of care for his patients;
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● Destroying his personal property in his office, which included cards/gifts of
thanks from grateful patients;
● Destroying his own personal health-care records from his office;
● Telling him that his malpractice insurance was being immediately ended;
and
● Falsely telling third parties that Dr. Chase had to be escorted off the
hospital grounds.
Though the standard for stating an IIED claim is exacting, at this stage, Dr.
Chase enjoys the benefit that all factual allegations and all reasonable interferences
drawn from them are construed wholly to his benefit. In keeping with that, the
Court must assume that the conduct described above is highly unusual for a
termination in the medical profession, that telling third parties of being escorted
from the premises could impact Dr. Chase’s standing in the greater community and
for other employment, that denying him the ability to transition care for his
patients would cause him extreme concern for the ongoing safety of his patients,
that destruction of personal health records and personal property of the type
described would also cause a person great emotional pain. This conduct, on the
present record, cannot be assumed to be de rigueur in this context. Viewed in Dr.
Chase’s favor, such conduct goes well beyond mere indignities associated with a
standard termination. The alleged actions reflect the type of “oppressive conduct
and abuse of a position of authority vis-a-vis plaintiff” that Crump suggests can
suffice to establish IIED. Crump, 154 Vt. 296.
The motion to dismiss the IIED claim is denied.
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IV. Declaratory Judgment Claims
Gifford also moves to dismiss Counts VII to IX of the Complaint for failure to
state claims and/or for mootness. In those Counts, Dr. Chase seeks declaratory
relief concerning the report Gifford made about him to the Board and Gifford’s
institution of a peer review concerning him. Gifford maintains that it was required
to make the report to the Board and that, in any event, as both the report and the
peer review were withdrawn, no live controversy remains between the parties.
As to the assertion that it was required to make the report, the record does
not support that conclusion. Gifford argues that it had to report Dr. Chase to the
Board under 26 V.S.A. § 1317(b)(3)(C). That provision requires a hospital to file a
report identifying:
(3) Acts or omissions of the licensee that occur in the course of
practice and result in one or more of the following:
. . .
(C) Written discipline that constitutes a censure, reprimand, or
admonition, if it is the second or subsequent censure, reprimand, or
admonition within a 12-month period for the same or related acts or
omissions that previously resulted in written censure, reprimand, or
admonition. The same or related acts or omissions includes similar
behavior or behavior involving the same parties, or both. Oral censure,
oral reprimand, and oral admonition are not considered reportable
disciplinary actions, and notation of an oral censure, oral reprimand,
or oral admonition in a personnel or supervisor’s file does not
transform the action from oral to written.
Accordingly, to justify a mandatory report, there must have been at least two events
of a similar nature leading to written discipline within a 12-month period.
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Based on the Complaint, in December 2020, Gifford threatened to subject Dr.
Chase to a peer review or performance improvement plan for allegedly delinquent
charts. In July 2021, Gifford actually imposed such a performance plan. In August
2021, Gifford threatened to impose a second improvement plan for the same
reason—but it did not. These are the “two” incidents of written discipline that
Gifford claims required it to file the report with the Board. Plainly, however, there
was one incident that happened; the other was only threatened. Gifford’s claim that
it had no choice but to file the report has no merit based on the allegations.
Gifford also contends: “There is no dispute that the report to the Board and
the peer review are over and done with, and that they no longer have any potential
to affect any rights of Plaintiff.” On that basis, Gifford maintains the issues are
moot. The Court disagrees.
“The Declaratory Judgment Act allows parties who have a dispute within a
court’s jurisdiction to petition that court for declaratory relief at an early stage of
the proceedings; however, the Act does not increase or enlarge the jurisdiction of the
court over any subject matter or parties.” Vermont State Employees’ Ass’n, Inc. v.
Vermont Crim. Just. Training Council, 167 Vt. 191, 194 (1997); see also Anderson v.
State, 168 Vt. 641, 643 (1998) (“The purpose of a declaratory judgment is to provide
a declaration of rights, status, and other legal relations of parties to an actual or
justiciable controversy.”). “A declaratory judgment will issue if it serves the useful
purpose of clarifying the legal relations of the parties or terminating the insecurity
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and uncertainty of the controversy.” Coop. Fire Ins. Ass’n of Vermont v. Bizon, 166
Vt. 326, 331 (1997).
Here, at page 8 of Gifford’s Reply Memorandum, it concedes that the
allegations of a sham report and peer review process would be relevant to Plaintiff’s
IIED claim. Though Gifford presumed that the IIED claim would be dismissed, it
has not been. On this basis alone, the claims for declaratory relief in that regard
present an ongoing controversy that cannot be dismissed at this juncture.
Gifford further argues that there is no justiciable controversy over the report
and peer review process in relation to Dr. Chase’s other claims. These arguments
are to some extent nuanced and depend on Gifford’s view of the facts and policy
positions as to relevant statutory provisions. They will be better addressed once the
evidence is developed. It suffices to say that, at this point, the Court cannot
conclude the allegedly false report to the Board and sham peer review would have
no ongoing relevance to a number of Plaintiff’s other claims as well as his IIED
cause of action.
The Court appreciates the policy concerns raised by Gifford in connection
with preserving the immunity of such professional review processes. The concerns
are legitimate and significant. But those protections are qualified, not absolute.
See 26 V.S.A. § 1317(e) (bad faith report to Board not shielded from liability); 26
V.S.A. § 1442(a) (bad faith conduct related to peer review committee not shielded
from liability); 42 U.S.C. § 11112(a) (no liability shield for professional review action
undertaken in bad faith). At this stage, Dr. Chase’s allegations potentially fall
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within the ambit of the exceptions to the general cloak of immunity that exists for
such proceedings.1
V. Conclusion
Based on the foregoing, Defendant’s partial motion to dismiss is denied.
Counsel are to confer and submit a proposed Discovery/ADR schedule within 21
days.
Electronically signed on Thursday, January 4, 2024, per V.R.E.F. 9(d).
_______________________
Timothy B. Tomasi
Superior Court Judge
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To the extent Gifford additionally argues that the federal statute is not implicated
because its peer review process did not have an impact on Dr. Chase’s position or
status, the Court is not persuaded. The statute focuses on actions that “may” have
such an impact, and the allegations here are sufficiently broad to support such an
inference. 42 U.S.C. § 11151(9) (defining “professional review action,” in part, as an
action “which affects (or may affect) adversely the clinical privileges, or membership
in a professional society, of the physician”); see Vt. R. Civ. P. 9(b) (“Malice, intent,
knowledge, and other condition of mind of a person may be averred generally.”). In
any event, if the statute did not apply to the process in this instance, the qualified
privilege also would not apply.
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