Johnson v. ROGERS MEMORIAL HOSPITAL

283 Wis.2d 384

2005 WI 114

700 N.W.2d 27

Charles JOHNSON and Karen Johnson, Plaintiffs-Appellants, v. ROGERS MEMORIAL HOSPITAL, INC., Defendant-Respondent, HEARTLAND COUNSELING SERVICES and South Street Clinic, Defendants, Kay PHILLIPS, Ph.D., Jeff Hollowell, Tim Reisenauer, and Wisconsin Patients Compensation Fund, Defendants-Respondents.

Nos. 2003AP784, 2003AP1413.

Supreme Court of Wisconsin.

Oral argument November 3, 2004.

Decided July 8, 2005.

For the plaintiffs-appellants there were briefs by William Smoler and Smoler Law Office, LLC, Monona, and oral argument by William Smoler.

For the defendant-respondent, Rogers Memorial Hospital, Inc., there was a brief by Laurie J. McLeroy and Otjen, Van Ert, Lieb & Weir, S.C., Milwaukee, and oral argument by Laurie J. McLeroy.

For the defendant-respondent, Kay Phillips, Ph.D., there was a brief by David McFarlane, Francis X. Sullivan and Bell, Gierhart & Moore, S.C., Madison, and oral argument by David McFarlane.

For the defendants-respondents, Drs. Jeff Hollowell and Tim Reisenauer, there was a brief by Bradway A. Liddle, Jr., Sarah A. Zylstra and Boardman, Suhr, Curry & Field, LLP, Madison, and oral argument by Sarah A. Zylstra.

¶ 1. LOUIS B. BUTLER, JR., J.

This case stems from allegations that therapists implanted and reinforced in a patient false memories of childhood physical and sexual abuse committed by the patient's parents. The patient, Charlotte, has since accused her parents, Charles and Karen Johnson (Johnsons) of being child abusers and disassociated herself from them. The Johnsons commenced an action against, among other parties, her therapists for negligent treatment, but the action has been impeded by Charlotte's refusal to waive her therapist-patient privilege.

¶ 2. We accepted the court of appeals' certification to determine whether there should be an exception to the therapist-patient privilege when an adult child accuses her parents of physical and sexual abuse based on memories recovered during therapy, and the parents sue the child's therapists for infliction of emotional harm. The Johnsons submit that this court need not reach that issue, because they argue Charlotte waived her privilege or, in the very least, did not have a privilege with respect to communications made to an unlicensed therapist.

¶ 3. We conclude that Charlotte did not waive her therapist-patient privilege, as she did not disclose any significant part of a confidential matter or communication.¹ We further conclude that Charlotte's communications with the unlicensed therapist were privileged because of Charlotte's reasonable expectation that they would be and because the unlicensed therapist worked under the direction of a physician.²

¶ 4. In response to the court of appeals' certified question, we conclude that there is a public policy exception to the therapist-patient privilege and to the confidentiality in patient health care records where negligent therapy causes false accusations against the parents for sexually or physically abusing their child. The exception is not unlimited and is implicated only where the plaintiff can establish a reasonable likelihood that negligent therapy occurred and the trial court agrees that the records contain relevant information regarding negligent treatment after conducting an in camera review. In those limited instances, the trial court must disclose those records to the plaintiff, and the privilege and confidentiality associated with those particular records is removed.³ Therefore, we reverse the circuit court's order and remand this case for further proceedings.⁴

I

¶ 5. This is the second time this case is before this court. See Johnson v. Rogers Memorial Hosp., Inc., 2001 WI 68, 244 Wis. 2d 364, 627 N.W.2d 890 (Johnson II). The factual record is still relatively sparse, as this case was first before this court after a motion to dismiss, and is again before us after limited discovery was conducted following this court's reversal of the order granting the motion to dismiss and remand to the circuit court. For completeness, the following factual background discussion is taken from Johnson II, with supplementations from the discovery that has since occurred.

¶ 6. In late summer or fall of 1991, the Johnsons' daughter, Charlotte, began psychotherapy treatment with Kay Phillips and Heartland Consulting Services. Id., ¶ 2. Shortly after that, Phillips referred Charlotte to Rogers Memorial Hospital for treatment for eating and addictive disorders and for sexual and physical abuse issues. Id. Charlotte was admitted as an inpatient to Rogers Memorial in early November 1991 and remained there until nearly the end of the month. Id., ¶¶ 2-3.

¶ 7. At Rogers Memorial, Charlotte received therapy from Jeff Hollowell and Tim Reisenauer, both licensed psychologists under Wis. Stat. ch. 455 at all relevant times, during which she developed the belief that Charles raped her and Karen physically abused her as a young child.⁵ Id., ¶ 3. Charlotte confronted Charles about this abuse on November 22, 1991, and confronted Karen on October 28, 1993. Id., ¶ 3.

¶ 8. Although the Johnsons denied the abuse occurred, Charlotte terminated her relationship with her parents. Id., ¶ 4. The Johnsons have been unsuccessful in reestablishing any relationship with her, and Charlotte continues to believe that her parents abused her. Id.

¶ 9. On May 29, 1996, the Johnsons filed a complaint against the defendants alleging, among other claims, that Phillips, Hollowell, and Reisenauer provided negligent treatment that resulted in Charlotte falsely believing that she had been sexually and physically abused by her parents as a young child. Id., ¶ 5. Without counseling Charlotte to determine the validity of these memories, even after the Johnsons indicated the memories were unfounded, the Johnsons asserted that the therapists' continuous negligent therapy reinforced these false memories. Id.

¶ 10. After a series of motions to dismiss, the Dane County Circuit Court, the Honorable Daniel R. Moeser, eventually dismissed the Johnsons' complaint for, as relevant here, failing to state a claim upon which relief could be granted. Id., ¶¶ 9-10. The Johnsons appealed, and in the meantime this court decided Sawyer v. Midelfort, 227 Wis. 2d 124, 129, 136, 595 N.W.2d 423 (1999), which recognized a parent of an adult child's third-party professional negligence claim against a therapist for therapy that resulted in implanting and reinforcing false memories of sexual abuse in their child.

¶ 11. Notwithstanding Sawyer, the court of appeals affirmed the circuit court. Johnson v. Rogers Memorial Hosp., Inc., 2000 WI App 166, 238 Wis. 2d 227, 616 N.W.2d 903 (Johnson I). The court of appeals noted that the Johnsons did not have Charlotte's medical records. Id., ¶ 11. The court of appeals also believed that Charlotte neither waived her right to maintain their confidentiality, nor relinquished her privilege to retain the privacy of her communications with the therapists. Id. Thus, the court of appeals determined that the Johnsons could not prove their claim, nor could the therapists defend against it, without imposing significant collateral burdens on the therapist-patient confidential relationship. Id., ¶ 12. Due to the public policy underlying the patient-therapist privilege, the court of appeals concluded that a patient's records cannot be fair game whenever a suit of this kind was commenced. Id., ¶ 17.

¶ 12. This court reversed, determining that resort to public policy was premature because the record did not clearly indicate whether a burden would be placed on therapist-patient confidentiality. Johnson II, 244 Wis. 2d 364, ¶ 18. Specifically, this court found the record unclear as to whether Charlotte waived her privilege or whether a privilege applied at all under the circumstances. Id., ¶¶ 18-19. The matter was remanded to the circuit court to further develop the record.

¶ 13. On remand, the following factual record was developed regarding whether a privilege applied to Charlotte's therapy with Phillips. During Charlotte's therapy with Phillips, Phillips was not certified as a professional counselor pursuant to Wis. Stat. § 457.12. In fact, Phillips did not receive her certification until March 21, 1995.

¶ 14. While treating Charlotte, however, Phillips was supervised by Dr. David Israelstam, a licensed psychiatrist who supervised all the therapists at Heartland Counseling. Once a month, for one hour, Israelstam met with the four or five therapists so that they could present their cases and diagnoses. Israelstam would then sign-off on the diagnoses if he agreed with it. Israelstam also indicated he had continued supervision over cases depending on the frequency with which the patient met with the therapist. He reviewed the case in the same manner described above every 90 days if the patient was seen once a week or less and every 30 days if the patient was seen twice a week or more. He also stated he was screening the cases to determine if medications were or hospitalization was necessary.

¶ 15. Sometime in April 1992, Charles went to Phillips' office and attempted to interrupt one of Charlotte's therapy sessions. As a result, the police were called. ¶ 16. The factual record was also developed on remand regarding whether Charlotte waived her privilege. The Johnsons submitted affidavits that averred that Charlotte's confrontations regarding the alleged abuse occurred during Charlotte's therapy sessions at Rogers Memorial Hospital. They further asserted that in addition to Charlotte, Reisenauer, and Hollowell being in the room during the confrontation, another patient, Charlotte's "silent advocate," was present.

¶ 17. Charles' affidavit stated that in late 1991 and early 1992, he agreed to help Charlotte pay for her therapy and began receiving billing statements from the defendants. The bills detailed the dates and times Charlotte underwent therapy as well as who...