Wang v. Ochsner Medical Center - Kenner, L.L.C. et al

Filing 38

ORDER AND REASONS: ORDERED that Dr. Boudreaux's 21 Motion to Dismiss is GRANTED and the Ochsner defendants' 25 Motion to Dismiss is GRANTED. The plaintiff's RICO claims are dismissed with prejudice, and his state law claims are dismissed without prejudice. Signed by Judge Martin L.C. Feldman on 12/7/2017. (clc)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA

YI-ZARN WANG, M.D.

CIVIL ACTION

v.

NO. 17-5134

OCHSNER MEDICAL CENTER KENNER, L.L.C., ET AL.

SECTION "F"

ORDER AND REASONS
Before the Court are two motions: (1) a motion to dismiss by
defendants Ochsner Medical Center – Kenner, L.L.C., Ochsner Clinic
Foundation, Ochsner Clinic L.L.C., and Ochsner Health System; and
(2) a motion to dismiss by Dr. J. Philip Boudreaux.

For the

reasons that follow, the motions are GRANTED.
Background
This civil Racketeer Influenced and Corrupt Organizations Act
and state law litigation arises from allegations by Dr. Yi-Zarn
Wang

that

Ochsner

Medical

Center-Kenner,

L.L.C.

and

its

affiliates, and fellow doctor, Dr. J. Phillip Boudreaux, schemed
to defraud him by steering neuroendocrine cancer patients from Dr.
Wang to Dr. Boudreaux, by trumping up false accusations that Dr.
Wang violated hospital policy, and ultimately by suspending Dr.

1

Wang and terminating his privileges at the hospital based on the
trumped up accusations and in violation of hospital bylaws. 1
After initially obtaining a dental degree in his native
Republic of China, Dr. Yi-Zarn Wang moved to the United States,
where he finished post-graduate school and enrolled in the School
of Medicine at The Oregon Health Sciences University.

After

obtaining his MD degree, Dr. Wang participated in the Barnes
Hospital/Washington University Surgical Residency Program in St.
Louis, Missouri, a world class surgical oncology discipline under
numerous renowned surgeons.
In 1994, Dr. Wang joined the faculty at Louisiana State
University Health Sciences Center in New Orleans. Before Hurricane
Katrina, he served as Chief of General Surgery and Director of
Surgical Education; he also ran surgical cancer care for indigent
patients in Louisiana.
group

at

Ochsner

After Katrina, he relocated and joined the

Medical

neuroendocrine patients.

Center-Kenner,

L.L.C.

to

serve

He partnered with J. Phillip Boudreaux,

This factual summary is drawn from the 36-page first amended
complaint and the 64-page RICO case statement filed in compliance
with this Court’s standing order. See Thompson v. City of Waco,
Texas, 764 F.3d 500, 502 (5th Cir. 2014)(in assessing the
plausibility of the allegations in a complaint, courts “accept all
well-pleaded facts as true and view all facts in the light most
favorable to the plaintiff.”).
1

2

another

surgeon

who

specialized

in

neuroendocrine

cancer

treatment.
For

many

years,

Ochsner

promoted

Dr.

Wang’s

skills

and

specialized abilities for patients requiring neuroendocrine cancer
surgery.

A

pioneer

in

the

field,

Dr.

Wang

had

developed

complicated approaches to surgery and other treatment options for
neuroendocrine cancer. For example, Dr. Wang was the first surgeon
in the world to intrude lymphatic mapping technique to define
surgical

resection

margin

of

midgut

neuroendocrine

tumors

to

eliminate recurrence and to preserve ilocecal valve in selective
patients to reduce post-operative diarrhea. Dr. Wang was the first
surgeon

to

pioneer

intra-operative

chemotherapy;

through

this

treatment, Dr. Wang targeted midgut neuroendocrine tumor (NET)
patients

who

are

often

diagnosed

at

an

advanced

stage

extensive mesenteric lymph node and liver metastasis.

with

In these

cases, even with surgery, small specks of cancerous tissues can
still remain.

Dr. Wang’s treatment targets the potential tumor

residuals in mesenteric lymph node dissection beds using a safe
and local application of chemotherapy agent 5-fluorouracil (5-FU).
The 5-FU is delivered via intraoperative application of 5-FU
saturated gel foam strips secured into the mesenteric defect

3

following the extensive lymphadenectomy. 2

Dr. Wang then mastered

the radio-guided surgery for neuroendocrine tumor cytoreductive
procedures including a minimally invasive approach to address the
lymph nodes metastasis in the neck and upper mediastinum.

Dr.

Wang also developed techniques to safely dissect and remove tumors
encasing major blood vessels to the liver and intestine and became
well known for taking on “unresectable” patients from different
states and countries.
Dr. Wang became the preeminent NET surgeon at Ochsner Kenner
and was the most sought out NET surgeon for academic speaking
engagements, professional organizations, and NET patients.
notoriety

prompted

starting in 2010.

recruitment

efforts

by

multiple

This

hospitals

It is alleged that Dr. Wang’s potential move

and loyalty became a concern to Dr. Boudreaux and the hospital.
Because they feared losing Dr. Wang, it is alleged, Dr. Boudreaux
and Ochsner Kenner sought to minimize Dr. Wang’s practice by
steering Dr. Wang’s patients to Dr. Boudreaux’s practice.
To accomplish this, starting as early as 2010, Dr. Boudreaux
worked with Ochsner Kenner employee, Pam Ryan, who controlled
intake communications with patients, 3 to divert NET patients away

Dr. Wang colloquially calls this treatment the “Chinese
dumpling,” which has dramatically reduced tumor resection bed
recurrence and improves long term survival.
3 Ms. Ryan was required to set up an appointment with Dr. Woltering
for new patients, and -- if a surgeon was needed -- then the
2

4

from Dr. Wang to Dr. Boudreaux. It is alleged that Ms. Ryan would
mislead patients from seeing Dr. Wang, direct those patients
instead to Dr. Boudreaux, and that she would “penalize” or sabotage
those who insisted on seeing Dr. Wang.

Nurse Ryan’s patient-

steering conduct was motivated by “an inappropriate relationship.”
According to the allegations of the complaint, Dr. Boudreaux
increased his own annual earnings through this scheme, earning
approximately $100,000 more each year from 2010 to 2016.
Dr. Wang says he discovered the scheme in 2015 and lists about
a

dozen

instances

unidentified
patients

that

staff
Dr.

where

Ms.

member,
Wang

was

Ryan

misled

or,

on

one

patients

unavailable

or

occasion

an

by

advising

the

not

accepting

new

patients, even though Dr. Wang was actually available and accepting
new patients.

Dr. Wang also alleges that the patient steering

scheme was confirmed by two online patient reviews.

Through this

patient information, Dr. Wang says it became clear to him that a
scheme to defraud him of money or property by false representations
was calculated to deceive him (through non-disclosure) as well as
his

patients

(through

misleading

statements

and

concealing

material facts).

patient would be referred evenly between the two surgeons. If, on
the other hand, a patient or doctor specifically requested Dr.
Wang, Ms. Ryan was supposed to follow the referring physician’s
instruction or patient’s request, and set up an appointment with
the requested surgeon.
5

Dr. Wang says he reported to LSU the misleading statements
made

to

his

patients

and

the

potential

of

relationship fueling the patient diversion.

an

inappropriate

LSU told Dr. Wang

that he needed to address those issues with Ochsner Kenner and
request a new nurse.

On October 10, 2015, Dr. Wang met with

Ochsner CEO Stephen Robinson to report his concerns.

Dr. Wang

showed Mr. Robinson emails and communications from his patients
regarding Ms. Ryan’s patient steering conduct.
In light of this report, it is alleged, Mr. Robinson, Dr.
Boudreaux, and others combined to retaliate against Dr. Wang.

Dr.

Wang alleges that Dr. Boudreaux knew that if Dr. Wang was forced
out, Dr. Boudreaux could then be the leading surgeon in Kenner and
would inherit Dr. Wang’s patients without the need to steer the
patients.

Ochsner Kenner, it is alleged, was heavily invested in

the neuroendocrinology department and worried about Dr. Wang’s
loyalty to the hospital; the hospital did not want to suffer the
financial loss it would experience if it lost Dr. Wang’s patients.
The solution, it is alleged, was to ruin Dr. Wang’s reputation
and keep his patients at Ochsner. Ochsner Kenner and Dr. Boudreaux
had to come up with a plan to tarnish Dr. Wang’s reputation.
Acting on this plan, in early December 2015, Ochsner Kenner and
Dr. Boudreaux targeted Dr. Wang’s use of Non-Operative Treatment
of Appendicitis (NOTA) to trump up a charge that Dr. Wang violated

6

Ochsner Kenner policy.
accepted

treatment

NOTA has received national prominence as

for

appendicitis;

the

practice

is

both

scientifically accepted in the medical community and also often
practiced at Ochsner Kenner by many physicians.
Dr. Wang preferred NOTA for treating appendicitis.

Despite

the substantial literature supporting NOTA, on December 18, 2015,
the Medical Staff Vice-President at Ochsner Kenner, Najy Masri,
wrote to Dr. Wang admonishing him for offering NOTA as an option
to his patients.

Dr. Masri demanded that Dr. Wang immediately

discontinue NOTA for his Ochsner Kenner patients.

Dr. Masri also

noted that the medical leadership council would refer this matter
to the Medical Executive Committee for further review in January.
Dr.

Wang

responded

by

detailing

the

national

medical

community’s acceptance of NOTA; he also requested a meeting to
discuss the developments and the trend toward adopting NOTA.

On

February 4, 2016, the Ochsner Kenner Medical Executive Committee
(OK-MEC or the Committee) wrote to Dr. Wang requesting that he
provide literature supporting NOTA.
the

Committee

with

evidence

of

Dr. Wang did so; he provided
clinical

acceptance

of

the

treatment, including five randomized clinical trials, seven metaanalyses, and 60 papers.
In March 2016, the OK-MEC Chair, Dr. Dasa, called Dr. Wang
regarding a meeting that occurred on March 17, 2016.
7

Dr. Dasa

informed Dr. Wang that the committee would permit Dr. Wang to use
antibiotic therapy for uncomplicated appendicitis on the condition
that, if the patient failed to improve within 24 hours, Dr. Wang
must

cease

surgery.

antibiotic

and

instead

intervene

with

To confirm this conversation, the Committee wrote to Dr.

Wang on April 26, 2016.
their

treatment

consent,

for

a

Dr. Wang used NOTA for his patients, with
24-hour

trial

period.

If

the

patient

responded appropriately, the therapy continued.
Sometime in April 2016, Dr. Wang was treating a patient with
appendicitis;

he

disclosed

to

the

patient

information required for informed consent.

the

basic

medical

In front of students

and residents, he discussed the treatment options, including the
24 hour rule.

Dr. Wang noted this in the patient’s chart.

The

patient responded to the IV antibiotic therapy within the 24-hour
benchmark as demonstrated by an improving clinical exam, afebrile
and reducing WBC.

Dr. Wang offered the patient a surgical option

the following morning even with her signs of improvement.

She

declined surgery, opting to continue antibiotic therapy.

IV

antibiotics were switched to PO on the second hospital day.

The

patient was observed in the hospital for an additional 24 hours to
make sure she would do well on PO antibiotics.
discharged

to

home

on

PO

antibiotics

on

the

She did.
third

She was
day

with

instruction that 15% of patients might fail the antibiotic therapy
or have recurrence; she was told to return if her condition
8

worsened or recurred.

This successful treatment followed the

medical standard of care and also the Ochsner Kenner policy.
On May 26, 2016, the Committee held a secret emergency meeting
regarding

Dr.

Wang’s

use

of

NOTA.

During

Committee suspended Dr. Wang for five days.

the

meeting,

the

The grounds for the

suspension were the Committee’s allegation that Dr. Wang had
violated the February 4, 2016 letter requiring that he discontinue
NOTA at OMC-K.

The Committee’s decision directly contradicted its

prior confirmation to Dr. Wang both on the phone and in writing
that he could perform NOTA for 24 hours.

Dr. Vinod Dasa drafted

a letter on behalf of the Committee; the letter outlined the
factually

inaccurate

and

contradictory

charges,

which

it

is

alleged Ochsner knew were false, unsupported, and misleading and
made with the intent to injure Dr. Wang.

Dr. Dasa also called Dr.

Wang to inform him of the suspension. 4
Ochsner Kenner conditioned Dr. Wang’s return from the fiveday suspension on signing a performance review plan.

To sign the

review plan would effectively oblige Dr. Wang to waive appeal
rights

related

to

NOTA,

admit

that

his

performance

needed

Dr. Dasa also explained that Dr. Wang violated the conduct policy
because insofar as he made derogatory comments about Ochsner
Kenner’s policy concerning NOTA and “impugns the quality of care”
provided by Ochsner Kenner. The Committee also claimed that Dr.
Wang disclosed confidential peer review information outside the
peer review process by informing his patient of Dr. Wang’s and the
hospital’s differing views regarding NOTA.
4

9

improvement, admit that he acted in a derogatory manner, and admit
to the suspension.

Dr. Wang refused to sign the plan.

When Dr.

Wang returned to Ochsner Kenner after his five-day suspension, he
was told that he no longer had privileges at the hospital because
he failed to sign the plan; a plan Dr. Wang characterizes as
pretextual.
That the peer review process (culminating in Dr. Wang’s fiveday suspension and the revocation of his privileges) was a sham is
allegedly demonstrated by Ochsner Kenner’s various breaches of the
bylaws.
adhere

[1] Ochsner Kenner breached the bylaws by failing to
to

the

provisions

regarding

suspension of Dr. Wang’s privileges.

the

investigation

and

The Committee only has

authority to “recommend suspension of clinical privileges for a
term” after the OK-MEC or other committee follows the investigative
procedures outlined in the bylaws.

[2] Section 7.3(A)(1) of the

bylaws requires that the OK-MEC provide Dr. Wang notice of the
investigation.

Section 7.3(b)(4) requires that OK-MEC provide Dr.

Wang with an “opportunity to meet with the investigating committee
before it makes its report.”

But Ochsner Kenner neither informed

Dr. Wang of the investigation, nor did it allow Dr. Wang an
opportunity to meet with the committee prior to its report.

[3]

Similarly, under Section 7.3(C)(3), after the OK-MEC makes a
recommendation
conclusions,

by

the

a

report

bylaws

identifying

require
10

the

its

committee

findings

and

to

the

refer

recommendation to the governing board of Ochsner Kenner.

But this

did not happen with Dr. Wang, who alleges that OK-MEC simply held
a secret meeting and decided to suspend Dr. Wang’s privileges while
breaching the procedural protection of the bylaws.

[4] Section

7.4(A)(1) limits summary suspensions to cases where OK-MEC finds
that “failure to take such action may result in imminent danger to
the health and/or safety of any individual or seriously impair the
ability of hospital staff members to perform their duties.”

But

OK-MEC skipped the investigation stage yet made no finding of
“imminent danger” in its May 27 letter in which OK-MEC implied
that this was a “final finding of responsibility,” in violation of
the bylaws.

[5] By attempting to skirt the hearing process and

conditioning Dr. Wang’s return on a waiver of rights to a hearing
or appeal process, OK-MEC violated the bylaws.

The May 27 letter

essentially revoked Dr. Wang’s privileges and violated the bylaws’
requirements regarding notice for hearings.
As a result of his suspension and the revocation of his
privileges, Dr. Wang has not maintained privileges at any hospital
except Physicians Medical Center in Houma.
at LSU.

And, he lost his job

It is also alleged that Ochsner Kenner and Dr. Boudreaux

have continued to misrepresent Dr. Wang’s availability to patients
in that Dr. Wang’s patients are being referred to Dr. Boudreaux,
implying that Dr. Wang is no longer practicing medicine, and
failing to disclose Dr. Wang’s contact information.
11

Dr. Wang was

also required to report the suspension to the Louisiana Board of
Medical Examiners.

As a result of what transpired at Ochsner

Kenner, Dr. Wang’s reputation has been damaged.
On May 23, 2017, Dr. Wang sued Ochsner Medical Center-Kenner,
L.L.C.,

Dr.

J.

Phillip

Boudreaux,

Ochsner

Clinic

Foundation,

Ochsner Clinic, LLC, and Ochsner Health System in this Court, and
on that same day he filed an amended complaint in which he alleges:
(A) as to all defendants: violations of the Racketeer Influenced
& Corrupt Organizations (RICO) Act, conspiracy to violate the RICO
Act, 5 violations
Consumer

of the Louisiana Unfair Trade

Protection

Law

(LUTPA);

and

(B)

as

Practices and

to

the

Ochsner

entities: breach of contract (for Dr. Wang’s loss of privileges),
negligent misrepresentation (for misrepresentations made during
the peer review process), tortious interference with contract (for
costing Dr. Wang his job at LSU), tortious interference with
prospective relations (for deterring patients from Dr. Wang). 6

Dr. Wang alleges that the defendants committed substantive RICO
violations (18 U.S.C. § 1962(c)) and conspired to violate RICO (18
U.S.C. § 1962(d)) when they formed an association-in-fact
enterprise that committed criminal wire and mail fraud against
him.
6 Also as to the Ochsner entities, Dr. Wang seeks declaratory and
injunctive relief under 28 U.S.C. § 2201; in particular, he seeks
a finding that his suspension and loss of privileges is invalid
and violated the by-laws agreed to by Ochsner Kenner and Dr. Wang.
He requests an order requiring Ochsner Kenner to remove the order
of suspension and revocation of Dr. Wang’s privileges from its
files.
5

12

Dr. Wang alleges entitlement to actual damages (including lost
wages, lost employee benefits, lost profits, and other direct
financial damages); consequential damages (damage to Dr. Wang’s
economic welfare, mental anguish and physical suffering, harm to
Dr. Wang’s reputation, lost business reputation, and attorney’s
fees); statutory trebling and exemplary damages warranted by the
defendants’ alleged malicious, willful, and egregious conduct.

In

compliance with this Court’s standing order, Dr. Wang filed a RICO
Case

Statement.

Dr.

Boudreaux

and,

separately,

the

Ochsner

entities now seek to dismiss each of Dr. Wang’s claims for failure
to state a claim upon which relief may be granted.
I.
A.

Rule 12(b)(6) of the Federal Rules of Civil Procedure allows
a party to move for dismissal of a complaint for failure to state
a claim upon which relief can be granted.

Such a motion is rarely

granted because it is viewed with disfavor.

See Lowrey v. Tex. A

& M Univ. Sys., 117 F.3d 242, 247 (5th Cir. 1997)(quoting Kaiser
Aluminum & Chem. Sales, Inc. v. Avondale Shipyards, Inc., 677 F.2d
1045, 1050 (5th Cir. 1982)).
Under Rule 8(a)(2) of the Federal Rules of Civil Procedure,
a pleading must contain a "short and plain statement of the claim
showing that the pleader is entitled to relief."
13

Ashcroft v.

Iqbal, 556 U.S. 662, 678-79 (2009)(citing Fed. R. Civ. P. 8).
"[T]he

pleading

'detailed

standard

factual

Rule

8

allegations,'

announces

but

it

does

demands

not
more

require
than

an

unadorned, the-defendant-unlawfully-harmed-me accusation." Id. at
678 (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)).
In considering a Rule 12(b)(6) motion, the Court “accept[s]
all well-pleaded facts as true and view[s] all facts in the light
most favorable to the plaintiff.”

See Thompson v. City of Waco,

Texas, 764 F.3d 500, 502 (5th Cir. 2014) (citing Doe ex rel. Magee
v. Covington Cnty. Sch. Dist. ex rel. Keys, 675 F.3d 849, 854 (5th
Cir. 2012)(en banc)).

But, in deciding whether dismissal is

warranted, the Court will not accept as true legal conclusions.
Id. at 502-03 (citing Iqbal, 556 U.S. at 678).
To survive dismissal, “‘a complaint must contain sufficient
factual matter, accepted as true, to state a claim to relief that
is plausible on its face.’” Gonzalez v. Kay, 577 F.3d 600, 603
(5th Cir. 2009)(quoting Iqbal, 556 U.S. at 678)(internal quotation
marks omitted). “Factual allegations must be enough to raise a
right to relief above the speculative level, on the assumption
that all the allegations in the complaint are true (even if
doubtful in fact).”
footnote omitted).

Twombly, 550 U.S. at 555 (citations and
“A claim has facial plausibility when the

plaintiff pleads factual content that allows the court to draw the

14

reasonable

inference

that

misconduct alleged.”

the

defendant

is

liable

for

the

Iqbal, 556 U.S. at 678 (“The plausibility

standard is not akin to a ‘probability requirement,’ but it asks
for more than a sheer possibility that a defendant has acted
unlawfully.”).

The Court’s task “is to determine whether the

plaintiff stated a legally cognizable claim that is plausible, not
to evaluate the plaintiff’s likelihood of success.”

Thompson v.

City of Waco, Texas, 764 F.3d 500, 503 (5th Cir. 2014)(citation
omitted).

This is a “context-specific task that requires the

reviewing court to draw on its judicial experience and common
sense.”

Iqbal, 556 U.S. at 679.

“Where a complaint pleads facts

that are merely consistent with a defendant’s liability, it stops
short

of

the

line

between

entitlement to relief.”

possibility

and

plausibility

of

Id. at 678 (internal quotations omitted)

(citing Twombly, 550 U.S. at 557).

“[A] plaintiff’s obligation to

provide the ‘grounds’ of his ‘entitle[ment] to relief’”, thus,
“requires

more

than

labels

and

conclusions,

and

a

formulaic

recitation of the elements of a cause of action will not do.”
Twombly,

550

U.S.

at

555

(alteration

omitted).

15

in

original)

(citation

B.
General notice pleading requirements are based on Rule 8.
Rule 9(b) imposes a heightened pleading standard on pleadings
alleging fraud:
(b) Fraud or Mistake; Conditions of Mind. In alleging
fraud or mistake, a party must state with particularity
the circumstances constituting the fraud or mistake.
Malice, intent, knowledge, and other conditions of a
person’s mind may be alleged generally.

FED. R. CIV. P. 9(b).

A plaintiff must plead “the particulars of

time, place, and contents of false representations, as well as the
identity of the person making the misrepresentation and what he
obtained thereby.”

Benchmark Elecs. V. J.M. Huber Corp., 343 F.3d

719, 724 (5th Cir. 2003)(quoting Tel-Phonic Servs., Inc. v. TBS
Int’l, Inc., 975 F.2d 1134, 1139 (5th Cir. 1992).
must

state

the

particularity
allegations.”

factual

and

basis

cannot

rely

for
on

the

“[A] plaintiff

fraudulent

speculation

or

claim

with

conclusional

United States ex rel. Rafizadeh v. Continental

Common, Inc., 553 F.3d 869, 873 (5th Cir. 2008).

Indeed, the Fifth

Circuit “interprets Rule 9(b) strictly, requiring the plaintiff to
specify the statements contended to be fraudulent, identify the
speaker, state when and where the statements were made, and explain
why the statements were fraudulent.” Flaherty & Crumrine Preferred
Income

Fund,

Inc.

v.

TXU

2009)(citation omitted).

Corp.,

565

F.3d

200,

207

(5

Cir.

Simply put, to comply with Rule 9(b),
16

plaintiffs must plead the “who, what, when, where, and how” of the
alleged fraud.

United States ex rel. Williams v. Bell Helicopter

Textron Inc., 417 F.3d 450, 453 (5th Cir. 2005)(internal citation
and quotation marks omitted).

If a plaintiff alleges fraud by

omission, “Rule 9(b) typically requires the claimant to plead the
type of facts omitted, the place in which the omissions should
have appeared, and the way in which the omitted facts made the
misrepresentations misleading.”

Carroll v. Fort James Corp., 470

F.3d 1171, 1174 (5th Cir. 2006).
Rule 9(b)’s particularity requirement applies to RICO claims
that rest on predicate acts of mail and wire fraud.

See Williams

v. WMX Technologies, Inc., 112 F.3d 175, 177 (5th Cir. 1997);
Landry v. Air Line Pilots Ass’n Intern. AFL-CIO, 901 F.2d 404, 430
(5th Cir. 1990).
II.
The

Racketeer

Influenced

and

Corrupt

Organizations

Act

(RICO), 18 U.S.C. § 1961-1968, prohibits certain conduct involving
a “pattern of racketeering activity.” As an enforcement mechanism,
18 U.S.C. § 1964(c) provides a private right of action for treble
damages to “[a]ny person injured in his business or property by
reason of a violation of section 1962 of this chapter.”

To pursue

a private RICO claim, a plaintiff must show that he has been
injured “by reason of” a violation of RICO’s criminal prohibitions;
17

a RICO plaintiff must “establish both but-for cause and proximate
cause in order to show injury ‘by reason of’ a RICO violation.”
Torres v. S.G.E. Mgmt., L.L.C., 838 F.3d 629, 636 (5th Cir.
2016)(internal citations omitted).

“When a court evaluates a RICO

claim for proximate cause, the central question it must ask is
whether the alleged violation led directly to the plaintiff’s
injuries.”

Anza v. Ideal Steel Supply Corp., 547 U.S. 451, 461

(2006); Allstate Ins. Co. v. Plambeck, 802 F.3d 665, 676 (5th Cir.
2015)(proximate cause is present where the injuries asserted were
the “objective of the [RICO] enterprise”).
Section 1962 lists four types of RICO violations.
asserts

that

the

defendants

violated

Section

Dr. Wang

1962(c),

which

proscribes participating in the conduct of the affairs of an
enterprise engaged in interstate commerce through a pattern of
racketeering

activity;

he

also

alleges

that

the

defendants

conspired to violate this provision in contravention of Section
1962(d).

Section

1961(1)

defines

“racketeering

activity”

by

listing various state and federal crimes, including (as pertinent
to this case) the federal crimes of mail and wire fraud.
§

1961(1)(B)(“any

act

which

is

indictable

under

18 U.S.C.

any

of

the

following provisions of title 18, United States Code...section
1341 (relating to mail fraud), section 1343 (relating to wire
fraud)....”).

Mail fraud “occurs whenever a person, ‘having

devised or intending to devise any scheme or artifice to defraud,’
18

uses the mail ‘for the purpose of executing such scheme or artifice
or attempting so to do.’”

Bridge v. Phoenix Bond & Indem. Co.,

553 U.S. 639, 647 (2008)(quoting 18 U.S.C. § 1341).

“The gravamen

of the offense is the scheme to defraud, and any ‘mailing that is
incident to an essential part of the scheme satisfies the mailing
element[.]”
712 (1989)).

Id. (quoting Schmuck v. United States, 489 U.S. 705,
This is so “even if the mailing itself ‘contain[s]

no false information[.]”

Id. (quoting Schmuck, 489 U.S. at 715).

These same principles apply to wire fraud, which occurs whenever
a person uses the interstate wires to effect a scheme or artifice
to defraud.

See Pasquantino v. United States, 544 U.S. 349, 353

(2005). 7
Section 1961(4) defines an “enterprise” as “any individual,
partnership, corporation, association, or other legal entity, and
any union or group of individuals associated in fact although not

7

The elements of mail or wire fraud are: (1) a scheme to defraud
by means of false or fraudulent representation; (2) use of
interstate or intrastate mail or wire to execute the scheme; (3)
the use of the mail or wire by the defendant to execute the scheme;
and (4) actual injury to the plaintiff. In re Burzynski, 989 F.2d
733, 742 (5th Cir. 1993). A plaintiff seeking to prove mail or
wire fraud must also prove that the defendant had the intent to
defraud. Chris Albritton Constr. Co. v. Pitney Bowes, Inc., 304
F.3d 527, 532 (5th Cir. 2002).
The Fifth Circuit defines this
intent element as acting “knowingly and with some specific intent
to deceive, ordinarily for the purpose of causing some financial
loss to another or bringing about some financial gain” to the
defendant. See United States. v. Morganfield, 501 F.3d 453, 464
(5th Cir. 2007)(citation omitted).

19

a legal entity.”

An association-in-fact enterprise is “a group of

persons associated together for a common purpose of engaging in a
course of conduct.”
(1981).

To

United States v. Turkette, 452 U.S. 576, 583

prove

the

existence

of

an

association-in-fact

enterprise, the plaintiff must submit “evidence of an ongoing
organization, formal or informal, and...evidence that the various
associates function as a continuing unit.”

Id.

Although an

association-in-fact enterprise need not be a business-like entity
replete with hierarchy, role differentiation, or chain of command,
the Supreme Court has instructed that such an enterprise must
feature “a purpose, relationships among those associated with the
enterprise, and longevity sufficient to permit these associates to
pursue the enterprise’s purpose.”

Boyle v. United States, 556

U.S. 938, 946 (2009).
Rather

than

articulating

a

meaningful

definition

of

“pattern,” Section 1961(5) offers up a minimum necessary condition
for

the

existence

of

a

pattern

of

racketeering

activity:

it

“requires at least two acts of racketeering activity, one of which
occurred after the effective date of this chapter and the last of
which occurred within ten years...after the commission of a prior
act of racketeering activity.”

18 U.S.C. § 1961(5); H.J. Inc. v.

Nw. Bell Tel. Co., 492 U.S. 229, 237 (1989).

RICO plaintiffs

must also satisfy the judiciary’s gloss on “pattern”:
demonstrate

the

requisite

pattern,
20

a

plaintiff

that is, to
must

show

“continuity plus relationship,” that is, “that the racketeering
predicates are related, 8 and that they amount to or pose a threat
of continued criminal activity.”

H.J. Inc., 492 U.S. at 239;

Abraham v. Singh, 480 F.3d 351, 355 (5th Cir. 2007)(citation
omitted)(“’[r]acketeering

activity’

consists

of

two

or

more

predicate criminal acts that are (1) related and (2) ‘amount to or
pose

a

threat

of

continued

criminal

activity.’”).

“These requirements keep civil RICO focused on the long term
criminal conduct Congress intended it to address, and ‘prevent
RICO from becoming a surrogate for garden-variety fraud actions
properly brought under state law[.]’”

Malvino v. Delluniversita,

840 F.3d 223, 231 (5th Cir. 2016)(citations omitted).
In

considering

what

conduct

meets

RICO’s

“pattern”

requirement, the Supreme Court has observed that RICO’s continuity
component

is

“centrally

a

temporal

concept”

attributed

Congress’s concern with “long-term criminal conduct.”
492

U.S.

at

242.

As

the

Supreme

Court

has

to

H.J. Inc.,
instructed,

“[c]ontinuity is both a closed- and open-ended concept, referring
either to a closed period of repeated conduct, or to past conduct

8

Related conduct “embraces criminal acts that have the same or
similar purposes, results, participants, victims, or methods of
commission, or otherwise are interrelated by distinguishing
characteristics and are not isolated events.” H.J., 492 U.S. at
240 (citation omitted).

21

that by its nature projects into the future with a threat of
repetition.”

Id. at 241.

Closed-ended continuity exists when the

“series of related predicates extend[s] over a substantial period
of

time,”

whereas

racketeering

acts

open-ended
themselves

continuity
include

a

exists
specific

repetition extending indefinitely into the future.”

when

“the

threat

of

Id.

Thus, to plead a RICO claim under Section 1962, a plaintiff
must

allege

“1)

racketeering

a

person

activity,

3)

who

engages

connected

in
to

2)

a

the

establishment, conduct or control of an enterprise.”

pattern

of

acquisition,
Abraham v.

Singh, 480 F.3d 351, 355 (5th Cir. 2007)(emphasis added). If these
three elements are sufficiently pled, the Court considers whether
the

plaintiff

adequately

states

a

substantive

claim

under

subsection (c), that is, whether the plaintiff alleges specific
facts concerning the “(1) conduct (2) of an enterprise (3) through
a pattern (4) of racketeering activity.”

See Sedima, S.P.R.L. v.

Imrex Co., 473 U.S. 479, 496 (1985); see also Elliott v. Foufas,
867 F.2d 877, 880 (5th Cir. 1989)(noting that “[t]his outline is
deceptively simple...since each concept is a term of art which
carries its own inherent requirements of particularity.”).

22

III.
A.

Against all defendants, Dr. Wang alleges fraud and conspiracy
to commit fraud in violation of 18 U.S.C. §§ 1961, 1962, 1964, and
1965, as well as violations of the Louisiana Unfair Trade Practices
and Consumer Protection Law, La.R.S. § 51:4101, et seq.

As to the

Ochsner entity defendants only, Dr. Wang additionally alleges
breach of contract (for Dr. Wang’s loss of privileges), negligent
misrepresentation (for misrepresentations made during the peer
review process), tortious interference with contract (for costing
Dr.

Wang

his

job

at

LSU),

and

tortious

interference

with

prospective relations (for deterring patients from Dr. Wang).
Presumably in connection with his breach of contract claim, Dr.
Wang

seeks

injunctive

and

declaratory

relief

respecting

his

suspension and loss of privileges as a result of Ochsner Kenner’s
alleged violation of the by-laws.

All defendants seek dismissal

of the plaintiff’s RICO claims as well as the plaintiff’s state
law claims.
B.
Given

that

the

Court’s

jurisdiction

is

based

upon

the

existence of RICO claims, the Court first takes up whether Dr.
Wang has adequately pled his RICO claims predicated on mail and
wire fraud.
23

The defendants advance an assortment of challenges to the
plaintiff’s RICO allegations.

Dr. Boudreaux urges dismissal of

the plaintiff’s RICO claims against him on the grounds that the
allegations fail to satisfy Rule 9(b)’s particularity requirement,
the plaintiff has omitted critical facts regarding Dr. Boudreaux’s
and

Dr.

Wang’s

relationship

as

employees

of

Louisiana

State

University School of Medicine, and the plaintiff has failed to
allege sufficient facts that Dr. Boudreaux “conducted” the alleged
enterprise.

The Oschner entities join in Dr. Boudreaux’s motion

and likewise challenge the sufficiency of Dr. Wang’s allegations
that each of the defendants conducted the alleged enterprise.

The

Ochsner entities also move to dismiss on the grounds that Dr. Wang
fails to adequately plead the elements of enterprise, pattern,
racketeering activity, and causation.
The Court first takes up whether Dr. Wang has satisfied his
pleading obligation with respect to the first element of his
substantive RICO claim, focusing on the allegations against Dr.
Boudreaux and then on the allegations against the Ochsner entities.
1.

Conduct

(a)

Dr. Boudreaux

Dr. Boudreaux contends that Dr. Wang’s allegations fall short
of

satisfying

Section

1962(c)’s

“conduct

or

participate”

requirement because no facts are alleged to indicate that Dr.
24

Boudreaux affirmatively participated in the alleged enterprise.
Dr. Wang has failed to allege facts that would support a finding
that Dr. Boudreaux “conducted” the alleged RICO enterprise, the
argument goes, given the absence of facts that plausibly suggest
that he participated in the patient steering conduct perpetrated
by Nurse Ryan. 9

Dr. Wang counters that he has sufficiently pled

that Dr. Boudreaux operated and controlled the enterprise.
Court disagrees.

The

The plaintiff’s allegations implicating Dr.

Boudreaux in wrongful conduct are wholly conclusory and at best
amount to an unadorned accusation or speculation that Dr. Boudreaux
participated in wrongful conduct.

Dr. Wang therefore fails to

state a claim against Dr. Boudreaux upon which relief may be
granted.
“’[T]o conduct or participate, directly or indirectly, in the
conduct of such enterprise’s affairs,’” consistent with Section
1962(c) as the Supreme Court instructs, “one must participate in
the operation or management of the enterprise itself.”
Ernst & Young, 507 U.S. 170, 185 (1993). 10

Reves v.

In so holding, the

Ochsner adopts Boudreaux’s argument that there are no facts to
support the conclusory allegation that Boudreaux “operated and
controlled The Enterprise” and “agreed to steer patients away from
Dr. Wang.”
10 In Reves, the Supreme Court resolved a conflict among the
circuits concerning the meaning of the RICO provision “to conduct
or participate, directly or indirectly, in the conduct of such
enterprise’s affairs.” Finding that the word “conduct” embraces
some degree of direction, the high court endorsed the “operation
or management” test, holding that “’to conduct or participate,
9

25

Supreme Court construed the word “conduct” so as to limit RICO
liability

under

Section

1962(c)

to

those

individuals

that

participate in the operation or management of a RICO enterprise;
some

degree

of

direction

or

substantive RICO liability.

control

is

required

to

impute

Id.

Given that Dr. Wang fails to advance any allegations that
attribute

any

substantive

peer

review

phase

conduct

to

Dr.

Boudreaux, 11 the Court scrutinizes the allegations concerning “the
patient steering scheme.”
not

a

single

fact

Dr. Boudreaux contends that there is

alleged

that

substantive “conduct” element.

would

plausibly

support

the

When the Court considers only the

facts alleged, and not conclusions or boilerplate, the Court
agrees.
Mindful that only well-pled facts must be considered true and
that

factual

content

must

be

pled

to

permit

the

reasonable

directly or indirectly, in the conduct of such enterprise’s
affairs,’ § 1962(c), one must participate in the operation or
management of the enterprise itself.” Id. at 185 (elaborating and
emphasizing that “liability depends on showing that the defendants
conducted or participated in the conduct of the ‘enterprise’s
affairs,’ not just their own affairs).
The only mention of Dr. Boudreaux with regard to the peer review
scheme is: “In his position of leadership within the Enterprise,
Dr. Boudreaux explicitly agreed and conspired to attack Dr. Wang’s
privileges. However, the actual predicate acts were carried out
by Ochsner Kenner, Dr. Dasa, and the OK-MEC.”
11

26

inference that a defendant is liable, the Court considers Dr.
Wang’s allegations directed toward Dr. Boudreaux:
•

“Dr. Boudreaux...operated and controlled The Enterprise and
engaged

in

a

pattern

of

racketeering

through

(1)

his

authorization of the predicate acts through his operation and
control of the enterprise and (2) by committing explicit
predicate acts.”
•

“This enterprise is led by Dr. Dasa, Dr. Boudreaux, Mr.
Robinson...and
exists,

these

Pam

Ryan....

individuals

While

no

organize

formal
and

leadership

control

the

enterprise.”
•

“Dr. Boudreaux maintained a position of leadership in this
Enterprise.

Dr. Boudreaux is an active participant in the

predicate acts committed by the Enterprise.”
•

“As a member of leadership of the Enterprise, Dr. Boudreaux
along with other members of the Enterprise agreed to steer
away patients from Dr. Wang and instead to Dr. Boudreaux.
Dr. Boudreaux was a direct participant in the acts committed
by the Enterprise....”

•

“This scheme was first accomplished in part by the combination
of

Dr.

Boudreaux

and

Oschner...employee

Pam

Ryan,

who

provided false information regarding appointments with Dr.

27

Wang, and pushed patients to instead receive treatment from
Dr. Boudreaux.”
•

“Ochsner Kenner did not explicitly participate in the initial
fraudulent statements by Ms. Ryan.”

•

“[T]hrough

her

control

of

the

intake

for

potential

NET

patients at Ochsner Kenner, Ms. Ryan would mislead patients
from seeing Dr. Wang and instead, direct patients to Dr.
Boudreaux.

In addition, she would also penalize those who

insisted to see Dr. Wang.

This association was additionally

motivated by an inappropriate relationship.”
From this sampling of allegations, no facts are alleged from which
the Court could divine what conduct Dr. Boudreaux participated in
that advanced the patient steering scheme.
tethered

to

factual

misrepresented

to

content

potential

suggest
or

The only allegations

current

that

Nurse

patients

Pam
Dr.

Ryan
Wang’s

unavailability so that she could schedule those patients with Dr.
Boudreaux instead.

Dr. Wang alleges that this conduct on Nurse

Ryan’s part was “potentially” accomplished in furtherance of an
“inappropriate
Boudreaux. 12

relationship”

between

Nurse

Ryan

and

Dr.

With no factual content to flesh out the labels Dr.

Insofar as the Court accepts as true the vague allegation that
Nurse Ryan and Dr. Boudreaux had an “inappropriate relationship”
that “potentially” fueled the patient steering conduct of Nurse
Ryan, Dr. Wang is no closer to stating a plausible Section 1962(c)
claim against Dr. Boudreaux. To the contrary, liability depends
12

28

Wang applies to Dr. Boudreaux, Dr. Wang’s allegations fail to
suggest that or how Dr. Boudreaux operated or managed the alleged
enterprise and therefore fail to comply with federal pleading
standards.
Additional allegations concerning Dr. Boudreaux’s motive or
benefit

from

the

alleged

patient

steering

scheme,

equally

conclusory and devoid of factual content, fare no better:
•

Dr. Wang’s loyalty and potential move became a concern to the
hospital and to Dr. Boudreaux;

•

Dr. Boudreaux’s annual earnings were increased substantially
as a result (that he earned $100,000 more a year);

•

Dr. Boudreaux knew his financial scheme would be eliminated
if Dr. Wang went public about the patient steerage.

If Dr.

Wang was forced out and lost his privileges to practice, Dr.
Boudreaux could then be the leading surgeon in Kenner and
inherit[] all Dr. Wang’s patients without the need for further
steering.
Other allegations mention Dr. Boudreaux only insofar as to indicate
that Nurse Ryan steered patients toward him and that he benefitted
from

the

minimization

of

Dr.

Wang’s

practice.

Other

than

upon a showing that the defendants participated in the conduct of
the enterprise’s affairs, not an individual’s own affairs. See
Reves, 507 U.S. at 185.
29

boilerplate allegations that Dr. Boudreaux was a leader that was
directly involved and authorized and committed predicate acts, the
only facts supporting the allegations of patient steering are those
attributing access, control, action, and misrepresentations to
Nurse Pam Ryan, not Dr. Boudreaux.
Dr. Wang thus fails to identify facts that would allow the
Court to infer that Dr. Boudreaux was in fact complicit in the
patient steering scheme as part of the alleged RICO enterprise. 13
Notably, Dr. Wang alleges in the RICO Case Statement that Pam Ryan
controlled the intake communication with patients, and that she
alone

scheduled

appointments

for

patients,

directing

them

to

either Dr. Wang or Dr. Boudreaux (or, Dr. Woltering if a new
patient did not require surgery).

It is Pam Ryan whom the

plaintiff identifies as the “person making misrepresentation” with

In his opposition papers, Dr. Wang insists that his allegations
contain factual content. But he simply points to allegations that
“Dr. Boudreaux [and] other[s] agreed to steer patients away from
Dr. Wang,” that Dr. Boudreaux “combined” with Ms. Ryan to
misrepresent Dr. Wang’s availability, and “the reality that ‘Dr.
Boudreaux knew that his financial scheme would be eliminated, if
Dr. Wang made public the scheme and inappropriate relationship.”
These allegations concerning conspiracy (conclusory ones, at that)
and thoughts or motive patently fail to identify conduct by Dr.
Boudreaux that would allow the Court to draw an inference that Dr.
Boudreaux participated in a predicate act or scheme. Conclusory
allegations divorced from factual content invite speculation only.
13

30

respect to each of the patient steering acts outlined on pages 34
through 50 of the RICO Case Statement. 14
What’s missing are factual allegations suggesting affirmative
wrongdoing

on

acquiescence.

Dr.

Boudreaux’s

part,

as

opposed

to

passive

See Rogers v. McDorman, 521 F.3d 381, 389 (5th Cir.

2008)(citing with approval an Eleventh Circuit opinion noting that
“federal RICO violations, as a matter of law, require affirmative
wrongdoing rather than passive acquiescence[.]”).

Stripped of its

conclusory allegations, what is it that Dr. Wang alleges that Dr.
Boudreaux did?

That he benefitted financially from the scheme,

and that he “combined” and “agreed” to steer patients away from
Dr. Wang. As to the former, financially benefitting from another’s
conduct or scheme is not sufficient to show that one actually
operated the scheme to defraud.

Cf. Davis-Lynch, Inc. v. Moreno,

667 F.3d 539, 551 (5th Cir. 2012).

Accordingly, insofar as Dr.

Wang alleges that Dr. Boudreaux benefitted from Ms. Ryan’s alleged
patient steering conduct, these allegations nevertheless fail to
indicate that Dr. Boudreaux actually operated the scheme to divert
the patients. 15

Likewise, that Dr. Boudreaux “agreed” to divert

Incidentally, the chart consistently identifies only Pam Ryan as
the person making the misrepresentation, save for one occasion
when an unidentified “Ochsner Clinic LLC staff member” takes her
place. Never Dr. Boudreaux.
15 The Court need not reach Dr. Boudreaux’s argument that it is
implausible that Dr. Boudreaux financially benefitted from the
scheme because it was LSU that received all monies for both Dr.
Boudreaux and Dr. Wang’s professional activities.
14

31

patients

from

Dr.

Wang

fall

short

of

alleging

even

any

conspiratorial role by Dr. Boudreaux; moreover, allegations of
acquiescence are too conclusory to be considered true for the
purpose of assessing plausibility of a substantive RICO claim
against Dr. Boudreaux. Even if the Court construed the allegations
of agreement as true, Dr. Wang still falls short of stating a
plausible Section 1962(c) claim against Dr. Boudreaux because
allegations of mere agreement or acquiescence fail to meet the
operation and management test announced by the Supreme Court.
Dr. Wang argues that a defendant need not actually commit a
predicate act in order for civil liability under RICO to attach; 16
he insists that a defendant need only operate or control the
enterprise.

But Dr. Wang may not simply invoke legal tests in the

abstract, or magic words, with no concrete facts.

He simply fails

to identify actual facts in his pleading that, if true, would show
that

Dr.

Recognizing

Boudreaux
that

the

operated
generic

or

controlled

labels

the

announcing

enterprise.
“operation,”

Dr. Wang argues that a defendant may violate RICO even if the
defendant has not personally engaged in acts of racketeering. But
the Sixth Circuit opinion Dr. Wang invokes to support this
proposition -- an opinion that was vacated when the en banc court
granted rehearing and ultimately affirmed the district court
rather than reversing like the panel had done -- merely
(unremarkably) observed that a plaintiff need not allege “that
each defendant committed two predicate acts as opposed to the
enterprise as a whole having committed at least two predicate
acts.”
Jackson v. Segwick Claims Mgmt. Servs., Inc., 699 F.3d
466, 482 (6th Cir. 2012), vacated on reh’g, 731 F.3d 556 (6th Cir.
2013)(en banc).
16

32

“control,”

and

“leadership”

are

felled

by

federal

pleading

standards, as a final attempt to avoid dismissal of his RICO claim
against Dr. Boudreaux, Dr. Wang points to his RICO Case Statement,
which states on page 36, in “Contents of Misrepresentation #3”:
Pam Ryan and Dr. Boudreaux represented to both W.K. and
A.K. that it was the policy of the office to rotate
patients so they received consultations from the entire
practice, to more efficiently coordinate care. In making
this representation, Ms. Ryan steered W.K. and A.K. to
Dr. Boudreaux. 17

This, Dr. Wang argues, suffices to allege that Dr. Boudreaux
himself made a misrepresentation to a patient, a predicate act
against patients A.K. and W.K “in November 2015.”

Inconsistently,

however, Dr. Boudreaux is conspicuously absent from the row in the
chart

identifying

“person

making

misrepresentation;”

in

the

patient steering chart, that person is identified as “Pam Ryan.”
Dr.

Boudreaux

is

misrepresentation.

never

identified

as

the

person

making

a

Not only is Dr. Boudreaux not identified as

the person making the misrepresentation, but he is also missing
from the factual explanation underlying the alleged predicate
offense, where Dr. Wang identifies the misrepresentation as the
predicate offense of wire fraud because “[t]he communications were

This allegation is contained in a chart Dr. Wang includes in the
Case Statement that directed Dr. Wang to “Provide the date of each
predicate act, the participants in each predicate act, and a
description of the facts constituting each predicate act.”
17

33

made via an (sic) interstate telephone communications between Ms.
Ryan in Louisiana and to W.K. in the state of Florida.”
Insofar as Dr. Wang argues that the stray reference to Dr.
Boudreaux

sufficiently

pleads

that

Dr.

Boudreaux

made

a

misrepresentation to a patient regarding Dr. Wang such that Dr.
Boudreaux

conducted

rejected.

The federal pleading standards, especially Rule 9(b),

which

applies

to

the

these

enterprise,

wire

fraud

this

argument

allegations,

must

demand

be

more.

Nowhere in the amended complaint or Case Statement does Dr. Wang
single out Dr. Boudreaux as making misrepresentations to any
patient.

Nor does Dr. Wang include any content in his pleadings

that would provide a factual predicate to the conclusions he
asserts.

In short, there is no factual content that would allow

the Court to draw the inference that Dr. Boudreaux operated,
managed, or somehow participated in the patient steering scheme.
No concrete facts to anchor a substantive RICO claim.
(b) Ochsner Entities
These pleading shortcomings are equally present when the
Court

considers

defendants.

the

allegations

against

the

Ochsner

entity

Citing an absence of factual allegations suggesting

operation or management of the alleged enterprise, the Ochsner
defendants move to dismiss the plaintiff’s claims against Ochsner
Health System, Ochsner Clinic Foundation, and Ochsner Clinic LLC.
34

The

plaintiff

does

not

oppose

dismissal

of

Ochsner

Clinic

Foundation and Ocshner Health System.
Ochsner Health System is not a viable RICO defendant because
there

are

no

factual

allegations

that

Ochsner

Health

System

directed the enterprise; the plaintiff merely alleges that Ochsner
simply “ratified and approved the acts” of others.

Similarly, the

plaintiff alleges in conclusory fashion that Ochsner Clinic LLC
actually directed the enterprise. As to Ochsner Clinic Foundation,
the entity the defendants admit actually employed Nurse Ryan, the
plaintiff’s RICO claim against this entity likewise fails because
RICO liability must be premised on affirmative wrongdoing, not
merely

employing

an

individual.

The

plaintiff’s

allegations

against these three entities do not go beyond conclusions and fail
to reach the plausibility threshold.

Wholly conclusory assertions

devoid of facts allow only speculative inferences not indulged by
federal pleading standards.

Because the plaintiff has failed to

allege facts to support an assertion that any of these defendants
directed the enterprise, the Court finds that the plaintiff has
failed to plausibly allege a RICO claim as to these defendants. 18
The plaintiff’s RICO claims against these entities -- Ochsner

Insofar as the plaintiff “requests leave to amend his complaint
to remove Ochsner Clinic Foundation and Ochsner Health Systems
regarding his RICO claims,” the Court finds that the plaintiff’s
RICO claims against these entitles must be dismissed, which
obviates any proposed amendment.
18

35

Health Systems, Ochsner Clinic Foundation, and Ochsner Clinic LLC
-- must be dismissed. 19
2.

Pattern

The Ochsner entities also move to dismiss Dr. Wang’s RICO
claims against them on the ground that Dr. Wang fails to allege
the continuity and relatedness of predicate acts to plausibly
allege a “pattern” of criminal activity.

Dr. Wang counters that

he has adequately alleged that the predicate acts are related and
that the patient steering conduct continues to this day insofar as
the defendants continue to advise his patients that he is retired
or otherwise unavailable to treat them.

Dr. Wang fails to allege

the requisite pattern of racketeering sufficient to state a RICO
claim against Ochsner Kenner.
To

demonstrate

the

requisite

pattern

of

racketeering,

a

plaintiff must show “continuity plus relationship,” that is, “that

Although Dr. Wang alleges that Ochsner Kenner “agreed,
authorized, and controlled this [patient steering] fraud through
its leadership in the Enterprise,” Dr. Wang alleges that “during
this period it appears Ochsner Kenner took a passive role and
merely authorized and controlled the enterprise’s fraud.” These
conclusory allegations fall short of sufficiently alleging that
Ochsner Kenner (or any Ochsner entity) conducted the patient
steering scheme that Dr. Wang attributes to Nurse Ryan.
Nevertheless, Ochsner Kenner does not move for dismissal of Dr.
Wang’s substantive RICO claim for failure to sufficiently plead
the “conduct” element insofar as Dr. Wang alleges that Ochsner
Kenner and its Medical Executive Committee orchestrated the
allegedly pretextual peer review scheme.
19

36

the racketeering predicates are related, and that they amount to
or pose a threat of continued criminal activity.”

H.J. Inc. v.

Nw. Bell Tel. Co., 492 U.S. 229, 239 (1989); 20 Abraham v. Singh,
480

F.3d

351,

355

(5th

Cir.

2007)(citation

omitted).

RICO’s continuity component is “centrally a temporal concept”
attributed
conduct.”

to

Congress’s

concern

with

H.J. Inc., 492 U.S. at 242.

“long-term

criminal

Indeed, “[c]ontinuity is

both a closed- and open-ended concept, referring either to a closed
period of repeated conduct, or to past conduct that by its nature
projects into the future with a threat of repetition.”
241.

Id. at

Closed-ended continuity exists when the “series of related

predicates extend[s] over a substantial period of time,” whereas
open-ended
themselves

continuity
include

a

exists
specific

indefinitely into the future.”

when

“the

threat

of

racketeering
repetition

acts

extending

Id.

Dr. Wang insists that he has alleged that the enterprise
committed at least 15 known predicate acts over about a five year
period, which he says meets the closed period continuity test.

He

also suggests that his allegations meet the open ended continuity
test because he has alleged, in connection with the sham peer

Related conduct “embraces criminal acts that have the same or
similar purposes, results, participants, victims, or methods of
commission, or otherwise are interrelated by distinguishing
characteristics and are not isolated events.” H.J., 492 U.S. at
240 (citation omitted).
20

37

review (which culminated in his loss of privileges), that Ochsner
continues to represent to patients that Dr. Wang is retired or
unavailable to treat them.

In so suggesting, Dr. Wang focuses

exclusively on the 14 or so misrepresentations to patients forming
the so-called patient steering scheme and fails to mention the
peer review phase.
Whether

Dr.

Wang

has

alleged

the

requisite

relationship

between the predicate acts depends on whether the criminal acts
“have

the

same

or

similar

purposes,

results,

participants,

victims, or methods of commission, or otherwise are interrelated
by distinguishing characteristics and are not isolated events.”
H.J. Inc., 492 U.S. at 240.

Dr. Wang’s allegations fail to

plausibly link the two phases of conduct he suggests comprise the
predicate acts committed against him.

As for the patient steering

phase (multiple instances of alleged wire fraud), Dr. Wang’s
allegations implicate only Nurse Ryan, whereas the allegations
concerning the lone peer review predicate act (wire fraud) are
that Dr. Dasa and other doctors, together with Ochsner Kenner,
abused the peer review process to force Dr. Wang out.

The alleged

purpose of steering patients to Dr. Boudreaux was so that the
hospital would keep Dr. Wang’s patients even if Dr. Wang left
Ochsner for another hospital, whereas the allegedly sham peer
review process was utilized in order to force out Dr. Wang,
Ochsner’s star physician.

The result of Nurse Ryan’s patient
38

steering conduct was that some patients saw Dr. Boudreaux instead
of Dr. Wang, whereas as a result of the sham peer review process,
Dr. Wang no longer has hospital privileges at Ochsner. The methods
of commission of the patient steering conduct versus the peer
review process are different, considering it is alleged that Nurse
Ryan misled patients to divert them to Dr. Boudreaux’s practice,
whereas it is alleged that the peer review process consisted of
secret meetings, a sham investigation, trumped-up charges, and
violations of hospital bylaws culminating in Dr. Wang’s suspension
and revocation of his privileges.

These two phases or schemes

have

participants,

distinct

purposes,

results,

and

disparate

methods of commission.
In the amended complaint and RICO Case Statement, the only
link between these two phases of conduct is the allegation that
the sham peer review process was initiated in retaliation for Dr.
Wang’s report to management that Nurse Ryan was diverting patients
to Dr. Boudreaux in furtherance of an improper relationship between
Nurse Ryan and Dr. Boudreaux.

However, this allegation does not

cure Dr. Wang’s failure to allege facts that would support a
finding that any of the defendants were complicit in the patient
steering phase.

In fact, the only patient steering conduct linked

to any Ochsner entity is a conclusory allegation disclaiming
Ochsner’s involvement in patient steering:

“Ochsner Kenner did

not explicitly participate in the initial fraudulent statements by
39

Ms.

Ryan....

While

directly

in

a

leadership

role

at

the

Enterprise, during this period it appears Ochsner Kenner took a
passive role and merely authorized and controlled the enterprise’s
fraud.”
No

More boilerplate.
factual

predicate

is

alleged

to

support

Dr.

Wang’s

insinuation of an overarching scheme, nor are facts indicative of
common intent adequately pleaded. 21

The isolated nature of the

respective phases of alleged fraudulent conduct 22 are laid bare
when

the

Court

considers

the

defendants’

argument

that

the

plaintiff fails to plausibly allege the requisite continuity.
Dr. Wang generally alleges that the alleged predicate acts
will continue in the future, suggesting that he relies on an openended continuity theory.

But the defendants contend that he fails

21

Dr. Wang’s allegations do not permit a reasonable inference of
systemic, as opposed to isolated “illegal” transactions or
schemes.
There are no facts indicating any leadership or
mastermind directing these different schemes conducted by
different players at different times using different methods. This
is one of the downfalls of conclusory and group-pleading
allegations. Where multiple defendants are involved in fraudulent
conduct, the plaintiff must connect the allegations of fraud to
each defendant. But here Dr. Wang alleges sweeping allegations of
mail and wire fraud directed at all of the defendants generally;
when he isolates the facts underlying the specific predicate acts,
however, he identifies only “fraudulent” conduct perpetrated by
non-defendants: Nurse Ryan (as to the patient steering scheme) and
Dr. Dasa (as to the peer review scheme).
Notably, there are no well pled allegations implicating Ochsner
Kenner in the patient steering conduct.
22

40

to allege facts that support a finding of open-ended continuity,
which “may be established by a showing that there is a ‘specific
threat of repetition extending indefinitely into the future,’ or
‘that

the

defendant’s

predicates
ongoing

are

a

regular

legitimate

way

of

conducting

business.”

Malvino

[a]
v.

Delluniversita, 840 F.3d 223, 232 (5th Cir. 2016).
Here, Dr. Wang alleges that he was targeted because of his
preeminence as a physician and as a result of the defendants’ fear
that he would leave Ochsner and take his patients with him.

The

defendants contend that these allegations fall short of alleging
that the wrongful conduct was a regular way of conducting Ochsner’s
legitimate business.

The Court agrees.

That Dr. Wang’s relationship with Ochsner has ended likewise
dooms

his

attempt

to

allege

a

continuity, the defendants contend.

pattern

based

on

open-ended

Again, the Court agrees.

Dr.

Wang alleges that the goal of the peer review scheme was to push
him out (“Dr. Dasa engaged in a scheme to defraud Dr. Wang, by
providing him misleading and inaccurate information in order to
terminate his privileges” and describing as the ultimate goal “to
completely take all of Dr. Wang’s patients by eliminating him at
Ochsner Kenner”).

Significantly, he alleges that the defendants

accomplished this goal with the sham peer review proceeding.
Where,

as

here,

the

enterprise’s

41

purported

goal

has

been

accomplished, Dr. Wang has failed to allege a threat of predicate
acts continuing into the future.

Dr. Wang no longer works for or

has privileges at Ochsner such that Ochsner can no longer manage
his patients or initiate peer review proceedings concerning his
conduct.

That Ochsner conducted a sham peer review proceeding

culminating in Dr. Wang’s termination defeats any attempt by Dr.
Wang to show that Ochsner’s conduct projects into the future.

Dr.

Wang has failed to allege a viable pattern of racketeering activity
and thus his substantive RICO claim directed at Ochsner Kenner
fails to state a plausible claim for relief. 23
C.
The defendants also move to dismiss the plaintiff’s claims
under

Section

1962(d),

Section 1962(c).

which

prohibits

conspiring

to

violate

Where a plaintiff fails to state a substantive

RICO claim, a RICO conspiracy claim likewise fails.

See Nolen v.

Nucentrix Broadband Networks Inc., 293 F.3d 926, 930 (5th Cir.
2002)(citation omitted).

Moreover, “because the core of a RICO

civil conspiracy is an agreement to commit predicate acts, a RICO
civil

conspiracy

complaint,

at

the

very

least,

must

allege

specifically such an agreement.” Abraham v. Singh, 480 F.3d 351,
358 (5th 2007)(citation omitted).

Because “[s]imply alleging the

The Court need not reach the defendants’ other asserted grounds
for dismissal of the plaintiff’s RICO claim.
23

42

existence

of

an

agreement...is

not

sufficient,”

Dr.

Wang’s

conspiracy claims must be dismissed for failure to state a claim.
See Tel-Phonic Servs., Inc. v. TBS Int’l, Inc., 975 F.2d 1134,
1140 (5th Cir. 1992)(conspiracy allegations insufficient where the
plaintiffs fail to “allege facts implying any agreement involving
each of the Defendants to commit at least two predicate acts.”).
Dr. Wang alleges nothing more than conclusions that the defendants
“agreed”

or

“combined”

to

violate

the

RICO

statute.

These

allegations fail to state a claim for civil conspiracy.
IV.
The Court’s jurisdiction is based upon the existence of RICO
claims, which the Court finds must be dismissed for failure to
state a claim. 24

Because the RICO claims supply the only basis

for federal jurisdiction, the Court may decline to reach the state
law claims.

28 U.S.C. § 1367(c) vests the Court with discretion

to decline to exercise supplemental jurisdiction where the Court
has dismissed all claims over which it has original jurisdiction.
The Court hereby exercises its discretion to decline to exercise
supplemental jurisdiction over the plaintiff’s state law claims. 25

The plaintiff has had ample opportunities to state a plausible
RICO claim.
Accordingly, the Court finds that granting the
plaintiff an opportunity to amend the amended complaint would be
futile.
25 The
Court declines to reach whether Dr. Wang has stated any
plausible claim for relief based on state law; the Court finds
24

43

***
Accordingly, for the foregoing reasons, IT IS ORDERED: that
Dr. Boudreaux’s motion to dismiss is GRANTED and the Ochsner
defendants’ motion to dismiss is GRANTED.

The plaintiff’s RICO

claims are dismissed with prejudice, and his state law claims are
dismissed without prejudice.
New Orleans, Louisiana, December 7th 2017
__,

______________________________
MARTIN L. C. FELDMAN
UNITED STATES DISTRICT JUDGE

only that his original complaint, 36-page amended complaint, and
64-page RICO Case Statement fail to state a plausible RICO claim.
44