Alexander v. Hackensack Meridian Health

FREDERICK ALEXANDER, M.D., and PEDIATRIC SURGICALCARE, LLC, Plaintiffs, v. HACKENSACK MERIDIAN HEALTH, et al. Defendants

Civil Action No. 19-18287

UNITED STATES DISTRICT COURT DISTRICT OF NEW JERSEY

September 29, 2020

Not for Publication

OPINION

John Michael Vazquez, U.S.D.J.

This case arises out of Defendant Hackensack Meridian Health's ("HMH")¹ and Defendant Hackensack Meridian Health Palisades Medical Center Foundation's ("PMC" and together with HMH, the "Hospitals")² termination of Plaintiff Dr. Frederick Alexander's clinical privileges at their facilities. D.E. 4 ("FAC"). Plaintiffs allege, among other things, that the Hospitals terminated Dr. Alexander's privileges in furtherance of a conspiracy to restrain Dr. Alexander's competition with another group of physicians. Pending before the Court is Defendants' motion to dismiss Plaintiffs' FAC pursuant to Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim. Defendants do not challenge the sufficiency of the allegations as to the anticompetitive conduct.The Court reviewed the parties' submissions in support and in opposition³ and decided the motion without oral argument pursuant to Fed. R. Civ. P. 78(b) and L. Civ. R. 78.1(b). For the reasons stated below, Defendants' motion to dismiss is granted in part and denied part.

I. BACKGROUND

A. Introduction

Dr. Alexander is a board-certified pediatric surgeon who was the Chief of Pediatric Surgery at HMH from 2007 to 2011. FAC ¶ A. Dr. Alexander voluntarily resigned from that position in June 2011 to pursue private practice. Id. ¶ 65. Dr. Alexander conducts business through Plaintiff Pediatric Surgicalcare, LLC. Dr. Alexander maintained clinical privileges at HMH until June 9, 2017, when HMH suspended them. Id. PMC, in turn, suspended Dr. Alexander's clinical privileges on January 25, 2019. Id.

Plaintiffs claim that the Hospitals improperly suspended Dr. Alexander's clinical privileges to eliminate his competition with pediatricians from New York University Langone Medical Center (the "NYU Group"), who HMH began collaborating with in 2012 after Dr. Alexander left. See id. ¶ 413. Plaintiffs allege that the process HMH used to suspend and ultimately terminate Dr. Alexander violated the "Constitution and Bylaws of the Medical and Dental Staff of HUMC" (the "Bylaws"). See id. ¶ A.

Starting in January 2015 and continuing through September 2016, HMH allegedly subjected Dr. Alexander to a baseless and retaliatory peer review. Specifically, Defendant Medical Executive Committee Of Hackensack University Medical Center (the "MEC")⁴ charged Dr.Alexander with "misuse" of HMH's ER and subjected him to a peer review (the "ER Peer Review") by other physicians at HMH. Id. ¶¶ 102-03. Plaintiffs allege that the MEC's decision to conduct the ER Peer Review "in-house" instead of retaining an outside clinician was improper. Id. ¶ 103. Based on the findings of the ER Peer Review, the MEC appointed a committee (the "Baker Committee") to investigate the charge that Dr. Alexander had misused HMH's ER. Id. ¶ 107. After its investigation, the Baker Committee issued a report stating that it did not find "any clear or demonstrable deviation from an ethical manner of practicing, or of not putting the patient's interest first." Id. ¶¶ 108, 109. As a result, on September 27, 2016, the MEC decided not to revoke Dr. Alexander's clinical privileges, but allegedly did order a secret professional performance evaluation ("FPPE"). Id. ¶ 110. Plaintiffs claim that the MEC did not inform Dr. Alexander of the Barker Committee's findings or about the FPPE to keep Dr. Alexander "uninformed" and "vulnerable." Id. ¶ 113.

While the Baker Committee's investigation was underway, Plaintiffs claim that HMH was simultaneously manipulating HMH's ER call roster and internal referral system to stifle Dr. Alexander's business. Id. ¶ 75. Plaintiffs allege that HMH removed Dr. Alexander from the ER call roster and placed him and another independent pediatric surgeon on a "secondary sham on-call schedule" even though the NYU Group did not have enough members to cover the call schedule. Id. ¶ 76-78. HMH also transferred patients to the NYU Group without notifying Dr. Alexander and without regard to patient preferences. Id. ¶¶ 81, 85. According to Plaintiffs, members of the NYU Group also pressured sub-specialist doctors at HMH to refer patients to the NYU Group and not to Dr. Alexander. Id. ¶ 89. The MEC ultimately reinstated Dr. Alexander tothe ER call schedule after determining that the manipulation of the on-call system was "unfair." Id. ¶ 79.

B. The Suspension and Termination Proceedings

On June 9, 2017, Defendant Dr. Martin Karpeh told Dr. Alexander that HMH had summarily suspended Dr. Alexander's clinical privileges. Id. ¶ 118. A letter informed Dr. Alexander that HMH based the suspension on "safety issues" related to his care of three patients (the "Original Cases"). Id. ¶ 119. Pursuant to the Bylaws, Dr. Alexander requested a hearing before the Defendant Ad Hoc Committee Hearing Panel at Hackensack University Medical Center ("AHC"). Id. ¶ 120. The AHC consisted of three physicians from the MEC that reviewed the MEC's summary suspension of Dr. Alexander. Id. ¶ 40.

The AHC conducted a hearing on June 13, 2017 (the "AHC Hearing"). Id. ¶ 124. Plaintiffs allege several improprieties as to the AHC Hearing. First, the MEC failed to provide a specific rationale for Dr. Alexander's suspension. Id. ¶ 122. Second, the AHC permitted the MEC to produce the relevant medical records for the first time on the day of the hearing, thus depriving Dr. Alexander of the opportunity to review the records to prepare. Id. ¶ 124. Third, the AHC permitted the hearing to go forward even though the Bylaws obligated the MEC to first investigate the alleged conduct, which was not done. Id. ¶ 134. Fourth, the AHC improperly failed to issue a report memorializing its final decision. Id. ¶ 136.

Plaintiffs further claim that witnesses at the AHC Hearing were either unqualified or biased. Plaintiffs allege that even though Defendant Dr. Keith Kuenzler did not review the medical records of the "Original Cases" before the suspension was imposed, the AHC still permitted Dr. Kuenzler to testify as an expert witness against Dr. Alexander at the hearing. Id. ¶ 129. Plaintiffsadd that the AHC should not have permitted Dr. Kuenzler to testify because he directly competed with Dr. Alexander for patients. Id. ¶ 128.

The AHC decided to uphold Dr. Alexander's summary suspension. Id. ¶ 136. In light of the AHC's decision, the MEC met on June 21, 2017 (the "June MEC Meeting") to consider further action against Dr. Alexander. The MEC did not permit Dr. Alexander or his counsel to appear or present evidence at the meeting, but allegedly took new testimony from another physician at HMH who did not testify before the AHC. Id. ¶ 143-46. Plaintiffs allege that this new evidence falsely indicated that the "Patient Safety Committee" had reviewed the Original Cases. Id. ¶ 147. Based on the AHC's decision and the new evidence presented at the June MEC Meeting, the MEC recommended that Dr. Alexander's medical staff appointment and clinical privileges be revoked at HMH. Id. ¶ 158. Following the MEC's recommendation, HMH submitted a Health Care Professional Responsibility and Reporting Enhancement Act report to the New Jersey Division of Consumer affairs. Id. ¶ 159. According to Plaintiffs, the report falsely indicated that Dr. Alexander's clinical privileges had been revoked due to "incompetency which relates adversely to patient care or safety" and "professional misconduct which relates adversely to patient care or safety." Id. HMH made a similar report to the National Practitioner Data Bank. Id. ¶ 160.

Pursuant to Article IX of the Bylaws, Dr. Alexander appealed the AHC's determination on June 27, 2020. Id. ¶ 162. The hearing started on October 9, 2017 and ended on July 12, 2018 (the "Article IX Hearing") and was held on fourteen separate evenings. Id. ¶ 171. Defendant Article IX Hearing Panel At Hackensack University Medical Center (the "Hearing Panel") presided over the matter. The Hearing Panel was composed of three unidentified physicians and one attorney, Defendant Richard J. Webb, Esq. Id. ¶ 45. Under the Bylaws, the Hearing Panel had the power to review the MEC's adverse recommendations. Id. ¶ 46.

As with the AHC Hearing and the June MEC Meeting, Plaintiffs allege numerous deficiencies with the Article IX Hearing. Plaintiffs first take issue with the Hearing Panel's decision not to dismiss 23 "new" cases (the "Added Cases") of alleged misconduct that the MEC advanced in support of the AHC's decision to suspend Dr. Alexander's privileges. Id. ¶ 164. The Added Cases occurred before the AHC rendered its recommendation yet were not presented during the AHC Hearing. Id. ¶ 165. In addition, 15 of the Added Cases either occurred before the MEC assembled the Baker Committee or were formally investigated by the Baker Committee. Id. ¶ 166. The Hearing Panel denied Dr. Alexander's motions to dismiss the Added Cases. Id. ¶ 175.

Plaintiffs also allege that the Hearing Panel issued several incorrect procedural decisions - on the advice of Webb - that rendered the Article IX Hearing unfair. See id. ¶¶ 176-205. Plaintiffs claim that the Hearing Panel improperly (1) precluded Dr. Alexander from presenting certain expert testimony, id. ¶ 177; (2) limited Dr. Alexander to one live expert witness for the Original Cases and prohibited Dr. Alexander from presenting live expert testimony on the Added Cases while the MEC was permitted to present live expert testimony on all the Added Cases, id. ¶ 178; (3) barred written expert witness reports, id. ¶ 182; (4) limited Dr. Alexander's witnesses, while similar limitations were not placed on the MEC, id. ¶ 183; (5) permitted non-pediatric surgeons to present expert testimony on pediatric surgery cases, id. ¶¶ 184, 208; (6) limited Dr. Alexander's counsel to written...