Wesley Health System, LLC v. Forrest County Board of Supervisors et al
Filing
280
ORDER denying AAA's 150 Motion to Dismiss; denying Plaintiff's 168 Motion for Declaratory Judgment; denying as moot Wesley's 251 Motion to Exclude Expert Testimony etc., denying as moot Wesley's 264 Motion to Strike ; denying as moot AAA's 266 Motion to Dismiss In Part; granting Forrest General's 253 Motion for Summary Judgment; granting AAA's 255 261 Motion for Summary Judgment; and granting AAA's 270 Motion for Summary Judgment. Signed by District Judge Keith Starrett on January 22, 2014 (dsl)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPPI
EASTERN DIVISION
WESLEY HEALTH SYSTEM, LLC
d/b/a WESLEY MEDICAL CENTER
V.
PLAINTIFF
CIVIL ACTION NO. 2:12-CV-59-KS-MTP
FORREST COUNTY BOARD OF
SUPERVISORS d/b/a FORREST GENERAL
HOSPITAL, et al.
DEFENDANTS
MEMORANDUM OPINION AND ORDER
For the reasons stated below, the Court rules as follows:
•
The Court denies Wesley’s Motion for Declaratory Judgment and
Injunctive Relief [168];
•
The Court grants Forrest General’s Motion for Summary
Judgment [253];
•
The Court grants AAA’s Motion for Summary Judgment [255, 261,
270];
•
The Court denies AAA’s Motion to Dismiss [150]; and
•
The Court denies as moot Wesley’s Motion to Exclude Expert
Testimony [251], Wesley’s Motion to Strike [264], and AAA’s
Motion to Dismiss in Part [266].
I. BACKGROUND
Plaintiff Wesley Medical Center alleges that Defendants – Forrest General
Hospital and AAA Ambulance Service – conspired to divert patients from Wesley to
Forrest General. Wesley alleges that the Defendants ignored patients’ desire to receive
medical services at Wesley, intentionally falsified medical records to justify
transporting patients to Forrest General, fraudulently obtained a disproportionate
share of trauma funds from the State of Mississippi, intentionally interfered with
Wesley’s business practices, defamed Wesley by making false statements about the
quality and type of services it offered, and ignored Mississippi’s Trauma System
Destination Guidelines. Wesley asserted claims under the Racketeer Influenced and
Corrupt Organizations (“RICO”) Act,1 claims under the Sherman Act,2 civil conspiracy,
intentional interference with business relations, and defamation.3 Wesley also seeks
a declaratory judgment that Mississippi law requires emergency medical service
(“EMS”) providers, such as AAA, to transport a patient to the hospital of their choice.
If the Court finds to the contrary, Wesley seeks a declaratory judgment that the
Mississippi Trauma Guidelines and related regulations are unconstitutional under
both the Mississippi and United States Constitutions. The parties have filed many
motions, and they are all fully briefed and ready for the Court’s review.
II. MOTION FOR DECLARATORY JUDGMENT AND INJUNCTIVE RELIEF [168]
Wesley requests a declaratory judgment on two questions of law related to this
dispute:
1.
Does the Plan allow an EMS provider, such as AAA, to ignore a
lucid patient’s expressed choice to receive medical services from a
specific facility?
1
18 U.S.C. § 1861, et seq.
2
15 U.S.C. § 1, et seq.
3
The Court previously dismissed all claims against Wade Spruill, the CEO of
AAA. See Wesley Health Sys., LLC v. Forrest County Bd. of Supervisors, No. 2:12CV-59-KS-MTP, 2012 U.S. Dist. LEXIS 145121, at *24-*26 (S.D. Miss. Oct. 9, 2012).
2
2.
Under Mississippi law, once a choice is clearly and expressly made
by a lucid patient, may an EMS provider attempt to dissuade
patients to be transported to another facility by providing false or
misleading information?
Wesley contends that the answer to both questions is “No.” Wesley also requests that
the Court order AAA and Forrest General to “comply with patient choice and/or to fully
satisfy the requirements of informed consent laws in Mississippi.”
The Court uses a three-step analysis to determine whether it should consider
a declaratory judgment claim. Sherwin-Williams Co. v. Holmes County, 343 F.3d 383,
387 (5th Cir. 2003). The Court considers: “(1) whether the declaratory action is
justiciable; (2) whether the court has the authority to grant declaratory relief; and (3)
whether to exercise its discretion to decide or dismiss the action.” Id.
The first element, justiciability, hinges on “whether the facts alleged, under all
the circumstances, show that there is a substantial controversy, between the parties
having adverse legal interests, of sufficient immediacy and reality to warrant the
issuance of a declaratory judgment.” Rowan Cos. v. Griffin, 876 F.2d 26, 28 (5th Cir.
1989). “A controversy, to be justiciable, must be such that it can presently be litigated
and decided and not hypothetical, conjectural, conditional or based upon the possibility
of a factual situation that may never develop.” Id. A substantial controversy exists
between the parties, and a legal question posed by Wesley’s motion is necessary to the
resolution of this case.
As for the second element, “a district court does not have authority to consider
the merits of a declaratory judgment action when: (1) the declaratory defendant
3
previously filed a cause of action in state court; (2) the state case involved the same
issues as those in federal court; and (3) the district court is prohibited from enjoining
the state proceedings under [the Anti-Injunction Act].” Sherwin-Williams, 343 F.3d at
388 n. 1. The Court is unaware of any previous or concurrent cases addressing these
issues in state court.
The final element incorporates a nonexclusive list of factors for the Court to
consider:
(1)
whether there is a pending state court action in which all of the
matters in controversy may be fully litigated;
(2)
whether the plaintiff filed suit in anticipation of a lawsuit filed by
the defendant;
(3)
whether the plaintiff engaged in forum shopping in bringing the
suit;
(4)
whether possible inequities in allowing the declaratory plaintiff to
gain precedence in time or to change forums exist;
(5)
whether the federal court is a convenient forum for the parties and
witnesses;
(6)
whether retaining the lawsuit would serve the purposes of judicial
economy; and
(7)
whether the federal court is being called on to construe a state
judicial decree involving the same parties and entered by the court
before whom the parallel state suit between the same parties is
pending.
Id. at 388 (quoting St. Paul Ins. Co. v. Trejo, 39 F.3d 585, 590-91 (5th Cir. 1994)).
None of these factors counsel dismissal of the entire declaratory judgment claim.
The factors of judicial economy and party convenience counsel that the Court should
4
render a decision – at least in part. The questions posed by Wesley in its motion [168]
do not mirror the declaratory relief requested in Count One of the Second Amended
Complaint [145]. Both questions vary from Count One insofar as they raise the issue
of lucidity, and they do not limit the Court’s analysis to cases involving trauma
patients. Furthermore, the second question’s concern with “attempt[s] to dissuade
patients . . . by providing false or misleading information” is wholly outside the scope
of Count One.
When broadly construed, though, the motion raises a legal question within the
scope of Count One and necessary to the resolution of this case: whether Mississippi
law gives EMS providers authority to transport trauma patients to a designated
trauma center despite their expressed desire to receive treatment at a different
hospital that is not a designated trauma center. That is the question the Court will
address.
A.
Mississippi Statewide Trauma Care System
The Mississippi legislature directed the Department of Health to “establish and
maintain a program for the improvement and regulation of emergency medical services
. . . in the State of Mississippi.” MISS. CODE ANN. § 41-59-5(1). Among other things, the
legislature provided:
The [Department of Health] . . . shall develop a uniform nonfragmented
inclusive statewide trauma care system . . . . The department is assigned
the responsibility for creating, implementing and managing the statewide
trauma care system. . . . The department shall develop and administer
trauma regulations that include, but are not limited to, the Mississippi
Trauma Care System Plan, trauma system standards, trauma center
designations, . . . [and] trauma care system evaluation . . . . The
5
department shall promulgate regulations specifying the methods and
procedures by which Mississippi-licensed acute care facilities shall
participate in the statewide trauma system. Those regulations shall
include mechanisms for determining the appropriate level of participation
for each facility or class of facilities. . . . The department shall promulgate
rules and regulations necessary to effectuate this provision . . . . The
department shall take the necessary steps to develop, adopt and
implement the Mississippi Trauma Care System Plan and all associated
trauma care system regulations necessary to implement the Mississippi
trauma care system.
MISS. CODE ANN. § 41-59-5(5).4 The legislature provided that the Trauma Care System
shall be funded by the Mississippi Trauma Care Systems Fund and Mississippi
Trauma Care Escrow Fund. MISS. CODE ANN. § 41-59-75.
Pursuant to this authority, the Department of Health developed the Mississippi
Trauma Care System Plan.5 “The goal of the Mississippi Trauma Care System is an
inclusive model, where the trauma patient is transported directly from the scene of
injury to a designated trauma center, staffed and equipped with the appropriate
resources to care for the specific needs of the patient.” See Mississippi Trauma Care
System Plan, at 5. The Department requires all “Mississippi licensed hospitals with
a functioning emergency department [to] apply for trauma center designation.” MISS.
4
A “trauma care system” is “a formally organized arrangement of health care
resources that has been designated by the department by which major trauma
victims are triaged, transported to and treated at trauma care facilities.” MISS.
CODE ANN. § 49-59-3(m). A “trauma care facility” or “trauma center” is “a hospital
located in the State of Mississippi . . . that has been designated by the department
to perform specified trauma care services within a trauma care system pursuant to
the standards adopted by the department.” MISS. CODE ANN. § 49-59-3(n).
5
A copy of the Mississippi Trauma Care System Plan is attached as Exhibit B
[191-2] to Forrest General’s response to Wesley’s Motion for Declaratory Judgment.
6
ADMIN. CODE § 15-2-32:1.2.1. After an application and inspection process, the
Department designates hospitals as either Level I, II, III, or IV trauma centers,
depending upon the resources available at each facility. MISS. ADMIN. CODE §§ 15-232:1.2.4, 1.2.5. “Every Mississippi licensed acute care facility (hospital) having an
organized emergency room service or department shall participate in the Mississippi
Statewide Trauma Care System.” MISS. ADMIN. CODE § 15-2-32.1.3.10. But “[a]ny
hospital that chooses not to participate in the Trauma Care System . . . , shall be
assessed and shall pay a non-participation fee . . . .” MISS. ADMIN. CODE § 15-232:1.3.13.
B.
Trauma Care Regions
Because different regions of the state may have different trauma care needs, the
state is divided into several Trauma Care Regions. MISS. ADMIN. CODE §§ 15-2-32:1.5.1,
1.5.2. Each Trauma Care Region has a Board of Directors which exercises
“administrative authority over the operation of the Trauma Care Region and
subsequent trauma system programs.” MISS. ADMIN. CODE § 15-2-32:1.5.3. At least one
purpose of the Trauma Care Regions is to “develop policies which provide a clear
understanding of the structure of the trauma system and the manner in which it
utilizes the resources available to it.” MISS. ADMIN. CODE § 15-2-32:1.5.8. Therefore,
each Trauma Care Region is required to develop a Regional Trauma Plan, “which
describes the policies procedures and protocols for a comprehensive system of
prevention and management of major traumatic injuries in a specific geographical
region.” MISS. ADMIN. CODE §§ 15-2-32:1.1.4, 1.5.6. The Regional Trauma Plans are
7
incorporated within the statewide Mississippi Trauma Care System Plan. See
Mississippi Trauma Plan, at 4. “All participating hospitals and licensed EMS providers
in each Region shall abide by the Region Trauma Plan and policies.” MISS. ADMIN.
CODE § 15-2-32:1.5.9.6
C.
Southeast Trauma Care Region
The parties here are in the Southeast Trauma Care Region (“SETCR”). The
SETCR is governed by a twelve-member Board of Directors comprised of
representatives from hospitals within the SETCR’s thirteen counties. SETCR Trauma
Plan, at 19.7 The SETCR is managed – under direction of the Board – by Defendant
AAA Ambulance Service, and the CEO of AAA, Defendant Wade Spruill, serves as the
CEO of the SETCR. Id. at 4-5. There are currently thirteen hospitals with emergency
rooms in the SETCR. Id. at 26. One of them, Defendant Forrest General Hospital, is
a Level II Trauma Center. Id. at 27. Of the remaining twelve, one is a Level III Trauma
Center, and ten are Level IV Trauma Centers. Id. at 27-28. Plaintiff Wesley Medical
Center only recently elected to participate in the Trauma Care System; it is seeking
designation as a Level III Trauma Center.8 On November 7, 2013, the Mississippi
6
See also Mississippi Trauma Plan, at 9 (“Once approved and included in the
state trauma plan, the regional trauma plan[s] are binding on all EMS providers
and acute-care facilities within the respective region.”); SETCR Trauma Plan, at 70
(“All In-Region Trauma Centers and EMS Agencies within the SETCR shall comply
with the Regional Plan . . . .”).
7
A copy of the SETCR Trauma Plan is attached as Exhibit C [191-3] to
Forrest County’s response to Wesley’s Motion for Declaratory Judgment.
8
See Exhibit “2" [266-2] to AAA’s Motion to Dismiss in Part as Moot.
8
Department of Health advised the SETCR that Wesley could be treated as if it had
already received a Level III designation, but Wesley did not participate in the Trauma
Care System at any time relevant to this case.
D.
Destination Guidelines
The Mississippi Trauma Plan directs Trauma Care Regions to establish
“destination protocols” to “assure trauma patients receive access to the most
appropriate care based on their injuries,” and which are “designed to deliver trauma
patients to the closest, most appropriate facility, regardless of the nearest facility or
the affiliation of the ambulance service.” Mississippi Trauma Plan, at 10. The SETCR
elected to adopt the Department of Health’s Consolidated Activation Criteria and
Destination Guidelines:
All ambulance services operating within the Southeast Trauma Care
Region will utilize Mississippi State Department of Health approved
policies, procedures, and protocols for the purpose of patient treatment
and activation and destination guidelines. The policies, procedures, and
protocols for determining triage criteria and patient destination adopted
by the State will be followed by the region.
SETCR Trauma Plan, at 67.
Therefore, in the SETCR “[a]ll trauma care patients will receive initial
evaluation for categorization as Alpha or Bravo using State approved activation
criteria,” and “[p]atient destination will be in accordance with State approved
destination guidelines.” Id. The SETCR Plan also provides that “[l]ocal ambulance
provider(s) shall be dispatched to scene under authority of provider’s medical control
plan,” and the “[l]ocal medical control plan shall direct ambulance provider to nearest
9
appropriate designated trauma center in accordance with the State Activation and
Destination Guidelines . . . .” Id. at 51.
Mississippi’s Consolidated Trauma Activation Criteria and Destination
Guidelines consist of a flow chart with instructions.9 EMS providers must first measure
a patient’s vital signs and level of consciousness and assess their injury. Id.
Injuries/conditions are categorized as either Alpha or Bravo, but both categories
broadly include room for “EMS/Health Provider Judgment.” Id. For patients over
fifteen years of age, both Alpha and Bravo patients require transport to a Level I, II,
or III Trauma Center “as appropriate for injuries.” Id. If the patient is not qualified as
either Alpha or Bravo, the Guidelines say to “[t]ransport according to local EMS
protocol (consider contacting Medical Control).” Id. They also include a list of
“SPECIAL CONSIDERATIONS,” such as: “Patients > 55 years are at increased risk
of injury/death,” and “Anticoagulents and bleeding disorders.” Id. They also provide:
“If there is any question concerning appropriate patient destination, or if requested by
the patient or another person to deviate from this protocol, CONTACT MEDICAL
CONTROL.” Id. (emphasis original).
E.
Medical Control
“Medical Control” is “[p]hysician direction over pre-hospital activities to ensure
efficient trauma triage, transportation, and care, as well as ongoing quality
management.” MISS. ADMIN. CODE § 15-2-32.1.1.4. All EMS providers must establish
9
The Destination Guidelines can be found at p. 144 of Exhibit “A” [191-1] to
Forrest County’s Response to Wesley’s Motion for Declaratory Judgment.
10
a “plan of medical control” which includes “patient destination criteria and treatment
protocols for the patient . . . .” MISS. ADMIN. CODE § 15-12-31:1.1.5. “All Medical Control
Plans shall comply with the Mississippi State Trauma Plan and all other applicable
system of care plans as directed by the Mississippi State Department of Health,
Bureau of Emergency Medical Services.” Id.
Medical Control Plans should establish “off-line” medical directors, who provide
“the administrative promulgation and enforcement of accepted standards for out-ofhospital care.” MISS. ADMIN. CODE § 15-12-31:1.1.6, Appendix 1. Off-line Medical
Directors have the authority to “[e]stablish criteria for determining patient destination
in a non-discriminatory manner in compliance with state guidelines as appropriate,”
and to establish the “circumstance a patient may be transported against his will . . .
.” MISS. ADMIN. CODE § 15-12-31, Appendix 1. On-line Medical Directors provide
instructions “directly to out-of-hospital providers . . . , generally in an emergency
situation, either on-scene or by direct voice communication.” Id. Two doctors serve as
the off-line and on-line medical directors under the SETCR’s Medical Control Plan:
John C. Nelson and William E. Walker.10 Additionally, “[o]n-line medical control
responsibilities are assigned to on-duty emergency room physicians at Forrest General
Hospital . . . .” Id. at p. AAAProd007101.
While the regulations allow for a patient’s private physician to intervene in some
circumstances, EMS providers must follow the orders of the on-line medical director,
10
See Exhibit “G” [191-7] to Forrest County’s Response to Wesley’s Motion for
Declaratory Judgment, p. AAAProd007100.
11
and the regulations specifically provide that nothing contained in them “implies that
the pre-hospital provider CAN be required to deviate from system protocols.” MISS.
ADMIN. CODE § 15-12-31, Appendix 1. The SETCR Medical Control Plan provides: “All
trauma patients should be treated in accordance with current protocols and
transported to appropriate destinations as delineated by the State Trauma Plan and
Trauma Destination Guidelines.” See SETCR Medical Control Plan [191-7], at p.
AAAProd007105. Additionally, the SETCR Trauma Plan provides: “Local medical
control plan shall direct ambulance provider to nearest appropriate designated trauma
center in accordance with the State Activation and Destination Guidelines . . . .”
SETCR Trauma Plan, at 51. Consistent with these regulations, Dr. John Nelson
testified [243]: “Once a medic calls in and says, ‘I think this is a trauma patient,’ my
answer would simply be, ‘If you declare this a trauma patient, then you need to abide
by the trauma destination guidelines.’ End of story.” He further testified that in the
SETCR EMS providers may only deviate from the Destination Guidelines if a patient
goes into cardiac arrest or needs intubation.
F.
Summary
All Mississippi-licensed EMS providers in the SETCR are required by law to
comply with the Mississippi Trauma Plan, the SETCR Trauma Plan, and the State
Destination Guidelines. MISS. ADMIN. CODE §§ 15-12-31:1.2.5, 15-2-32:1.5.10;
Mississippi Trauma Plan, at 9; SETCR Trauma Plan, at 70. According to the Trauma
Plans and Guidelines, trauma patients must be transported to a designated Level I,
II, or III Trauma Center. If a trauma patient does not wish to be transported to a
12
designated Trauma Center, the EMS provider can only abide by the patient’s wishes
if permitted to do so by Medical Control. In the SETCR, the Medical Control Plan
requires that all trauma patients be transported in accordance with the Guidelines,
and EMS providers may only deviate from this protocol if the patient goes into cardiac
arrest or needs intubation. Therefore – absent contrary authorization from Medical
Control – EMS providers in the SETCR must transport trauma patients to a
designated trauma center despite the patient’s expressed desire to go to a hospital that
is not a designated trauma center.
G.
Wesley’s Objections
Wesley raises two primary objections to this interpretation of Mississippi law.
First, Wesley argues that the statutes and regulations discussed above do not provide
EMS providers with clear, unquestionable authority to ignore patient choice. The Court
disagrees. As previously noted, all Mississippi-licensed EMS providers in the SETCR
must comply with the Mississippi Trauma Plan, the SETCR Trauma Plan, and the
Destination Guidelines. MISS. ADMIN. CODE §§ 15-12-31:1.2.5, 15-2-32:1.5.10;
Mississippi Trauma Plan, at 9; SETCR Trauma Plan, at 70. Every stage in the
regulatory scheme – the enabling statutes, the regulations, the Mississippi Trauma
Care System Plan, the SETCR Trauma Plan, the Destination Guidelines, and the
Medical Control Plan – promotes the central goal of ensuring that trauma patients
receive treatment at a designated trauma center with sufficient resources to handle
their injuries. See Mississippi Trauma Plan, at 11. Indeed, the Court’s analysis above
demonstrates that EMS providers are required by law to ignore patient choice if it
13
conflicts with the Destination Guidelines and instructions from Medical Control.11
Wesley also argues that these regulations do not supersede Mississippi’s
common-law requirement that “[n]o physician or hospital may subject one to medical
treatment without that person’s informed consent.” In re Brown, 478 So. 2d 1033, 1040
(Miss. 1985); see also Fox v. Smith, 594 So. 2d 596, 604 (Miss. 1992). This common-law
principle was “given constitutional status by Article 3, § 32 of the Mississippi
Constitution of 1890.” Brown, 478 So. 2d at 1040. Wesley effectively argues, therefore,
that the regulations are invalid because they violate the Mississippi Constitution. The
Court declines to consider this argument. Wesley has not sought joinder of the
Mississippi Department of Health, an indispensible party with respect to Wesley’s
constitutional claims. See Lewis v. La. State Bar Assoc., 792 F.2d 493, 496 n. 2 (5th Cir.
1986); Hefner v. Alexander, 779 F.2d 277, 282 (5th Cir. 1985).
H.
Conclusion
For all of the reasons stated above, the Court denies Wesley’s Motion for
Declaratory Judgment and Injunctive Relief [168]. A portion of the requested relief
exceeds the scope of Count One of the Wesley’s Second Amended Complaint [145], and
11
Wesley argued that a Memorandum [168-12] from the Department of
Health dated May 17, 2010, establishes that state policy is that “the patient’s choice
should be honored.” This argument fails for two reasons. First, an advisory memo
does not carry the same legal authority as regulations promulgated by a state
agency by authorization of the legislature. Second, Wesley misrepresented the
memo’s instructions. The Department advised that “any deviation from the
protocols should be communicated and approved by medical control.” If a patient
refuses transport to the facility required by the guidelines, the EMS provider may
only honor that choice if “medical control authorizes.” The memo does not conflict
with the regulations discussed above.
14
examination of the relevant state regulations demonstrates that EMS providers must
comply with the Destination Guidelines unless Medical Control provides authorization
to deviate from them. In light of these rulings, there is no basis for Wesley’s requested
injunctive relief.
III. MOTION FOR SUMMARY JUDGMENT – FORREST GENERAL [253]
Forrest General filed a Motion for Summary Judgment [253] that incorporates
the arguments presented in its previous Motion for Summary Judgment [122], which
the Court denied [141] pursuant to Rule 56(d). The parties have completed discovery,
and the Court may now address Forrest General’s arguments.
Rule 56 provides that “[t]he court shall grant summary judgment if the movant
shows that there is no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” FED. R. CIV. P. 56(a); see also Sierra Club, Inc.
v. Sandy Creek Energy Assocs., L.P., 627 F.3d 134, 138 (5th Cir. 2010). “Where the
burden of production at trial ultimately rests on the nonmovant, the movant must
merely demonstrate an absence of evidentiary support in the record for the
nonmovant’s case.” Cuadra v. Houston Indep. Sch. Dist., 626 F.3d 808, 812 (5th Cir.
2010) (punctuation omitted). The nonmovant “must come forward with specific facts
showing that there is a genuine issue for trial.” Id. (punctuation omitted). “An issue is
material if its resolution could affect the outcome of the action.” Sierra Club, Inc., 627
F.3d at 138. “An issue is ‘genuine’ if the evidence is sufficient for a reasonable jury to
return a verdict for the nonmoving party.” Cuadra, 626 F.3d at 812.
The Court is not permitted to make credibility determinations or weigh the
15
evidence. Deville v. Marcantel, 567 F.3d 156, 164 (5th Cir. 2009). When deciding
whether a genuine fact issue exists, “the court must view the facts and the inference
to be drawn therefrom in the light most favorable to the nonmoving party.” Sierra
Club, Inc., 627 F.3d at 138. However, “[c]onclusional allegations and denials,
speculation, improbable inferences, unsubstantiated assertions, and legalistic
argumentation do not adequately substitute for specific facts showing a genuine issue
for trial.” Oliver v. Scott, 276 F.3d 736, 744 (5th Cir. 2002).
A.
Tortious Interference and Defamation
Wesley conceded its state-law claims of defamation and tortious interference
with business relations against Forrest General. The Court grants Forrest General’s
motion for summary judgment as to those claims.
B.
Sherman Act
Forrest General argues that it is incapable of conspiring with AAA because it
controls it. “Section 1 of the Sherman Act . . . reaches unreasonable restraints of trade
effected by a contract, combination or conspiracy between separate entities. It does not
reach conduct that is wholly unilateral.” Copperweld Corp. v. Independence Tube Corp.,
467 US. 752, 768, 104 S. Ct. 2731, 81 L. Ed. 2d 628 (1984) (punctuation omitted).
[A]n internal “agreement” to implement a single, unitary firm’s policies
does not raise the antitrust dangers that § 1 was designed to police. The
officers of a single firm are not separate economic actors pursuing
separate economic interests, so agreements among them do not suddenly
bring together economic power that was previously pursuing divergent
goals.
Id. at 769, 104 S. Ct. 2731. Therefore, “officers or employees of the same firm do not
16
provide the plurality of actors imperative for a § 1 conspiracy.” Id. Likewise, “§ 1 is not
violated by the internally coordinated conduct of a corporation and one of its
unincorporated divisions,” Id. at 770, 104 S. Ct. 2731, and “the coordinated activity of
a parent and its wholly owned subsidiary must be viewed as that of a single enterprise
for purposes of § 1 of the Sherman Act.” Id. at 771. Coordination among such parties
“does not represent a sudden joining of two independent sources of economic power
previously pursuing separate interests.” Id.
“[S]ubstance, not form, should determine whether an entity is capable of
conspiring under § 1.” American Needle, Inc. v. NFL, 560 U.S. 183, 195, 130 S. Ct.
2201, 176 L. Ed. 2d 947 (2010) (punctuation omitted).
[T]he question is not whether the defendant is a legally single entity or
has a single name; nor is the question whether the parties involved seem
like one firm or multiple firms in any metaphysical sense. The key is
whether the alleged contract, combination or conspiracy is concerted
action – that is, whether it joins together separate decisionmakers. The
relevant inquiry, therefore, is whether there is a contract, combination or
conspiracy amongst separate economic actors pursuing separate economic
interests, such that the agreement deprives the marketplace of
independent centers of decisionmaking, and therefore of diversity of
entrepreneurial interests, and thus of actual or potential competition.
Id. (punctuation and internal citations omitted). The “inquiry is one of competitive
reality.” Id.
According to AAA’s corporate charter [122-2], it was created by the Board of
Trustees of the Forrest County General Hospital to “provide ambulance service to the
citizens . . . of the City of Hattiesburg, Mississippi and of the County of Forrest, State
of Mississippi,” and to “own, operate and maintain a public ambulance service facility
17
. . . as an integral part of the governmental function of the Board of Trustees.” The
bylaws require that Forrest General fund half of AAA’s operating deficits and capital
expenditures, while the City and County each contribute one-fourth of the necessary
funds. According to Evan Dillard [254-4] – AAA’s Chairman of the Board and Forrest
General’s CEO – Forrest General recently transferred $200,000.00 to AAA in
accordance with this requirement.
AAA is owned by Forrest General, the City of Hattiesburg, and Forrest County.
Its Board of Directors has six members. Four of the directors represent Forrest
General, while the City of Hattiesburg and Forrest County each have one
representative on the Board. Therefore, Forrest General controls four out of six votes
in every decision made by AAA’s Board of Directors. Additionally, the Chairman of
AAA’s Board – Evan Dillard – is the Chairman, President, and CEO of Forrest
General. AAA’s officers – CEO, CFO, and COO – are all employees of Forrest General.
As for AAA’s operations, Forrest General and AAA executed a General
Management Services Agreement [271-17]. AAA’s Board of Directors contracted with
Forrest General to provide AAA’s management. But the contract specifically provides
that “AAA has, and at all times during the Term shall exercise, the ultimate control
and direction of the assets and affairs of Service.” Notwithstanding this language, the
contract stipulates that Forrest General has the authority and responsibility to operate
all aspects of AAA’s services, including hiring, promoting, discharging, supervising,
budgeting, and capital expenditures. Also, AAA’s key personnel – Administrator, CFO,
and Director of Operations – must be employees of Forrest General.
18
Dillard – Forrest General’s CEO and AAA’s Chairman of the Board – testified
[254-4] that AAA submits its budget to Forrest General for approval, and that AAA’s
financial statements are consolidated with Forrest General’s. Wade Spruill – AAA’s
CEO and Forrest General’s employee – testified both that AAA maintains a “separate
set of books and records” from Forrest General [271-15], and that employees of Forrest
General control the operations of AAA [254-5].
Under the American Needle analysis, corporate formalities are meaningless. Id.
at 196. “The key is whether the alleged contract, combination, or conspiracy is
concerted action – that is, whether it joins together separate decisionmakers.” Id. at
195 (punctuation omitted). The alleged conspirators must be “separate economic actors
pursuing separate economic interests.” Id. “The question is whether the agreement
joins together independent centers of decisionmaking. If it does, the entities are
capable of conspiring under § 1 . . . .” Id. at 196.
The evidence cited above demonstrates that Forrest General controls AAA, and
that they do not constitute two separate, independent decisionmakers. Forrest General
controls two-thirds of the voting power on AAA’s Board, and AAA’s officers are Forrest
General employees. Through these positions and the authority granted it by the
General Management Services Agreement, Forrest General controls all of AAA’s
operations – in spite of the Agreement’s apparently empty provision that AAA
maintains “ultimate control and direction” of its operations. Indeed, Wesley’s corporate
representative and its CEO admitted [254-2, 254-3] that AAA’s operations were
directed and controlled by Forrest General. During oral argument, Wesley’s own
19
counsel described [254-1] the relationship among AAA, Forrest General, and the
SETCR as “incestuous.” Counsel argued:
Forrest General Hospital controls AAA and provides all the senior
management to AAA. . . . There is a contract between AAA and the
Southeast Trauma Care Region in which AAA runs the trauma care
region. So, in other words, you’ve got Forrest General Hospital . . .
controlling AAA and, in turn, controlling the trauma care region. So when
AAA and Forrest General say that AAA is forced to follow guidelines from
the trauma care region, what they’re saying is, “We’re forced to follow the
guidelines that we prepared ourselves.”
The evidence indicates that Counsel’s representations are true, that Forrest General
controls AAA, and that they are incapable of conspiring with one another under Section
One of the Sherman Act.
Wesley offered several specific objections that the Court must address. First,
Wesley argued that AAA and Forrest General are separate and distinct corporate
entities. As discussed above, corporate formalities are meaningless in determining
whether two parties are capable of conspiring under Section One of the Sherman Act.
Id. at 195-96. Wesley also noted that AAA and Forrest General have entered into
contracts with one another. This is an extension of the corporate formalities argument.
Two distinct corporate entities can, of course, enter into contracts with one another.
The crux of the matter is whether their decisions to do so stem from the same source
or separate sources. It is undisputed that Forrest General controls AAA’s decisions in
such matters.
Despite its own counsel’s argument to the contrary, Wesley also contends that
there exists a genuine dispute of material fact as to whether Forrest General controls
20
AAA. First, Wesley cites testimony from Spruill, CEO of AAA. Spruill testified [271-15]
that AAA and Forrest General are “different, but the ownership is multi-faceted, the
hospital being the primary, and the City and County involved, as well.” Spruill also
testified that he had separate duties in his various roles at AAA, Forrest General, and
the SETCR, that AAA has some separate employees from Forrest General, and that it
maintains separate “books and records.” But this testimony has no bearing on the key
issue here: whether Forrest General controls AAA’s operations, with the two entities
functioning as a single decisionmaker.
Several AAA employees provided testimony as to their understanding of the
relationship between AAA and Forrest General. Crystal Boutwell testified [271-8] that
she was not sure whether Forrest General owned AAA, but that she had “always been
told that AAA is a separate entity from the hospital.” Kacey Jones testified [271-9] that
she did not know whether Forrest General owned or controlled AAA. Finally, Kayla
Simmons [271-10] testified that she knows that Forrest General owns “a portion [of
AAA] in conjunction with other entities.” She said her understanding was that Forrest
General does not exercise “100 percent” control of AAA, but that it does “have some
input.”
This testimony is not sufficient to create a genuine factual dispute over Forrest
General’s control of AAA. Most of it is inadmissible hearsay or speculation. Further,
AAA employees’ understanding of corporate formalities and Forrest General’s
ownership interest in AAA is irrelevant to the issue of actual control. At best, these
witnesses were guessing as to Forrest General’s control of AAA. See Oliver, 276 F.3d
21
at 744 (speculation and unsubstantiated assertions do not create a genuine issue for
trial).
Finally, Wesley argues that a Sherman Act claim is viable regardless of whether
Forrest General can conspire with AAA, as there are other members of the alleged
conspiracy. Wesley argues that the SETCR, City of Hattiesburg, and Forrest County
all conspired with Forrest General to divert more patients to Forrest General for
treatment. But that is not the theory of liability that Wesley has advanced for the past
twenty months of litigation. Wesley has consistently framed this case as one
concerning a conspiracy between Forrest General and AAA.12 Although Wesley alleged
[145] that Forrest General, AAA, and “others” conspired to divert patients, Wesley did
not name any “others” or explain their role in the alleged conspiracy. Indeed, Wesley
first argued this alternate theory in response to Defendants’ motions for summary
judgment.
Therefore, the Court concludes that Wesley did not plead a Sherman Act claim
involving conspirators other than those specifically named as Defendants. “A claim
which is not raised in the complaint but, rather, is raised only in response to a motion
for summary judgment is not properly before the court.” Cutrera v. Bd. of Supervisors,
429 F.3d 108, 113 (5th Cir. 2005). Even if Wesley had raised such a claim, it was not
sufficiently pled, as Wesley did not name the other conspirators. See Norris v. Hearst
Trust, 500 F.3d 454, 464 (5th Cir. 2007) (“A naked allegation of conspiracy or
12
Wesley also initially named Spruill as a conspirator, but he was dismissed.
Wesley, 2012 U.S. Dist. LEXIS 145121 at *24-*26.
22
agreement, without more specific factual allegations, is not to be accepted as sufficient
to state a claim under Section 1 of the Sherman Act.”).
For all of the reasons stated above, the Court finds that there is no genuine issue
of material fact as to whether Forrest General and AAA constitute “separate economic
actors pursuing separate economic interests.” American Needle, 560 U.S. at 196. The
evidence demonstrates that Forrest General controls AAA. They are, therefore,
incapable of conspiring under Section 1 of the Sherman Act. Id. The Court grants
Forrest General’s motion for summary judgment as to Wesley’s Sherman Act claim.
C.
Civil Conspiracy
Among other arguments, Forrest General contends that the intra-corporate
conspiracy doctrine also applies to Wesley’s state-law civil conspiracy claim. The
Mississippi Supreme Court has never addressed the intra-corporate conspiracy
doctrine. Blades v. Countrywide Home Loans, Inc., No. 1:06-CV-1000-LG-JMR, 2007
U.S. Dist. LEXIS 69903, at *6 (S.D. Miss. Sept. 18, 2007). “To determine issues of state
law, we look to final decisions of the state’s highest court, and when there is no ruling
by that court, then we have the duty to determine as best we can what the state’s
highest court would decide.” James v. State Farm Mut. Auto. Ins. Co., 719 F.3d 447,
451 (5th Cir. 2013).
“Under Mississippi law, a conspiracy is a combination of persons for the purpose
of accomplishing an unlawful purpose or a lawful purpose unlawfully.” Gallagher
Bassett Servs. v. Jeffcoat, 887 So. 2d 777, 786 (Miss. 2004) (emphasis added). Two or
more parties must come to an agreement – or meeting of the minds – to form a
23
conspiracy. Id. at 786-87; see also Braddock Law Firm, PLLC v. Becnel, No. 2012-CA345-COA, 2013 Miss. App. LEXIS 473, *10-*11 (Miss. Ct. App. Aug. 6, 2013). These
Misssissippi cases suggest that a conspiracy can not be formed unless two separate,
independent parties reach an agreement.
The Court further notes that both District Courts in this state have applied the
intracorporate conspiracy doctrine to civil conspiracy claims under Mississippi law,
holding that a corporation can not conspire with its own employees or agents. See Frye
v. Am. Gen. Fin., Inc., 307 F. Supp. 2d 836, 843 (S.D. Miss. 2004); Cooper v. Drexel
Chem. Co., 949 F. Supp. 1275, 1285 (N.D. Miss. 1996); Cirillo v. Cent. Miss. Radiology,
LLC, No. 4:11-CV-24-JMV, 2013 U.S. Dist. LEXIS 87026, at *7 (N.D. Miss. June 19,
2013); Gardner v. Swedish Match N. Am., Inc., No. 2:04-CV-337-KS-JMR, 2006 U.S.
Dist. LEXIS 44680, at *12-*13 (S.D. Miss. Apr. 17, 2006). The Fifth Circuit has done
the same. Aiken v. Rimkus Consulting Group, Inc., 333 F. App’x 806, 812 (5th Cir.
2009); Allstate Life Ins. Co. v. Parnell, 292 F. App’x 264, 376-77 (5th Cir. 2008).
In light of these authorities, the Court concludes that the Mississippi Supreme
Court would apply the intra-corporate conspiracy doctrine to a civil conspiracy claim
under Mississippi law. For the same reasons stated above, the Court finds that there
is no genuine issue of material fact on this issue. The evidence demonstrates that
Forrest General controls AAA, and that they are incapable of conspiring with one
another. The Court grants Forrest General’s motion for summary judgment as to
Wesley’s civil conspiracy claim.
D.
Civil RICO
24
The Court grants Forrest General’s motion for summary judgment as to Wesley’s
civil RICO claim for the same reasons stated in the Court’s analysis of AAA’s motion
for summary judgment.
IV. MOTION FOR SUMMARY JUDGMENT – AAA [255, 261, 270]
AAA filed its own Motion for Summary Judgment [255, 261, 270], which
incorporates the arguments from its previous Motion for Summary Judgment [125] and
Forrest General’s motions.
A.
Sherman Act, Civil Conspiracy
The Court grants AAA’s motion for summary judgment as to Wesley’s Sherman
Act and civil conspiracy claims for the same reasons stated in the Court’s analysis of
Forrest General’s motion for summary judgment.
B.
RICO
A civil RICO claim has three elements: “(1) a person who engages in (2) a
pattern of racketeering activity (3) connected to the acquisition, establishment,
conduct, or control of an enterprise.” Huntington Nat’l Bank v. McCann, 268 F. App’x
359, 365 (5th Cir. 2008). To establish that Forrest General engaged in a “pattern of
racketeering activity,” Wesley must show that it committed at least two acts of
racketeering activity, as defined by 18 U.S.C. § 1961(1). 18 U.S.C. § 1961(1), (5). Wesley
argues that Forrest General committed at least two acts of kidnapping by
inveiglement.13 A person commits kidnapping by inveiglement if, “without lawful
13
In the Second Amended Complaint, Wesley alleged that Defendants
committed a variety of predicate acts, but in briefing the pending motions it only
25
authority and with or without intent to secretly confine,” they “inveigle or kidnap any
other person with intent to cause such person to be confined or imprisoned against his
or her will . . . .” MISS. CODE ANN. § 97-3-53 (2013).
To “inveigle” means to accomplish a kidnapping by use of enticement, trickery,
or deceit. Evans v. State, 725 So. 2d 613, 665 (1997); Williams v. State, 544 So. 2d 782,
790 (Miss. 1987). “Inveigling has no component of force, but only of coaxing. One does
not forcibly inveigle. Guilt exists if [the accused] coaxed the [victim] into his vehicle
with the intent to . . . confine her against her will.” Myers v. State, 770 So. 2d 542, 544
(Miss. Ct. App. 2000). In an earlier opinion, the Court held that “kidnapping is not a
specific intent crime.” Wesley Health Sys., LLC, 2012 U.S. Dist. LEXIS 145121 at *6
(citing Milano v. State, 790 So. 2d 179, 187 (Miss. 2001)). In retrospect, the Court’s
analysis of this issue was shallow, at best. The Court withdraws that opinion to the
extent it conflicts with this one.
Although the Mississippi Supreme Court has stated that “kidnapping is not a
specific intent crime,” Milano, 790 So. 2d at 187 (citing Williams v. State, 445 So. 2d
798, 809 (Miss. 1984)), such statements can not reasonably be interpreted as
abrogating the statute’s clear requirement of a mental state. See MISS. CODE ANN. § 97-
addressed kidnapping by inveiglement. When a defendant files a motion for
summary judgment and “the burden of production at trial ultimately rests on the
nonmovant, the movant must merely demonstrate the absence of evidentiary
support in the record for the nonmovant’s case.” Cuadra, 626 F.3d at 812. The
nonmovant “must come forward with specific facts showing that there is a genuine
issue for trial.” Id. Wesley provided no evidence or argument that either Defendant
committed any of the other predicate acts alleged in the Second Amended
Complaint. Therefore, the Court assumes that Wesley concedes those allegations.
26
3-53 (“. . . with intent to cause such person to be confined or imprisoned against his or
her will . . .”). Indeed, the Supreme Court has acknowledged that intent is an element
of the crime. Conley v. State, 790 So. 2d 773, 794 (Miss. 2001); Carr v. State, 655 So.
2d 824, 849 (Miss. 1995); see also Myers, 770 So. 2d at 544 (requiring intent to confine
the victim against her will). This becomes clearer when the isolated statement that
“kidnapping is not a specific intent crime” is read in its full context:
[I]t is conceivable that a reasonable juror could have found that [the
victim] was inveigled, i.e., enticed or tricked, with intent to . . . confine
her against her will. As kidnapping is not a specific intent crime, it is
sufficient that the circumstances resulted in such a manner as to effect
a kidnapping as opposed to an actual intent to kidnap, i.e. it is not
necessary to establish the mental state of intent by direct evidence.
Williams, 544 So. 2d at 790. In other words, intent to confine or imprison the victim
against his or her will is an element of kidnapping by inveiglement, but a fact-finder
may infer the necessary intent from circumstantial evidence of the circumstances
surrounding the alleged kidnapping.
AAA offered a variety of arguments challenging the sufficiency of Wesley’s
evidence to prove the elements of kidnapping by inveiglement. In response, Wesley
addressed six specific patients – Bland Simmons, Glynda Kranz, Orlea Risk, Mary Ann
Nester, John Rayner, and Frances Chisolm – arguing that AAA kidnapped each of
them. The Court need only address five of the patients.
1.
Bland Simmons
First, Wesley failed to present any evidence that AAA inveigled Bland Simmons.
Inveiglement requires enticement, trickery, deceit, or coaxing. Evans, 725 So. 2d at
27
665; Williams, 544 So. 2d at 790; Myers, 770 So. 2d at 544. Colonel Simmons testified
[168-10] that he asked to go to Wesley, but after consulting with a supervisor, the AAA
employees said they had to take him to Forrest General. He said: “[T]hey made an
effort to call their dispatch, and they made contact with some people there, and it was
a supervisor that either came on the radio or that . . . person contacted that said, no,
take him to Forrest General.” According to Colonel Simmons’ AAA Patient Care Report
[168-11], the instructions came from Dr. Mike Farmer, the on-line Medical Director.
No inveiglement, deceit, trickery, or coaxing was involved. In fact, when asked whether
he believed AAA had tricked or misled him, Colonel Simmons answered: “No. I think
they did what their boss told them to do.”
2.
Glynda Kranz
Glynda Kranz’s AAA Patient Care Report [168-6] indicates that the nature of the
call was for “Traumatic Injuries,” and her “condition code” was for “other Trauma
(fracture/dislocation).” According to the report, Ms. Kranz – a 69-year-old patient –
slipped and fell from a standing position, dislocating and fracturing her right ankle in
the process. According to the EMT, “[t]here was obvious deformity to the right ankle
with 60 degrees medial angulation.” At her deposition [168-5], Ms. Kranz agreed that
her ankle was obviously deformed. The EMT classified her as a Bravo-level trauma
patient, citing the criteria: “Special Considerations: Age > 55.” Ms. Kranz spent three
days in the hospital and underwent orthopedic surgery to repair the damage to her
ankle.
The evidence cited above demonstrates that AAA’s transportation of Glynda
28
Kranz was not “without lawful authority,” as required to prove kidnapping by
inveiglement. See MISS. CODE ANN. § 97-3-53. The Destination Guidelines [191-1]
include a list of criteria for Bravo-level trauma patients that leaves room for the
exercise of “EMS/Health Provider Judgment.” They also include a list of “SPECIAL
CONSIDERATIONS” to consider, including: “Patients > 55 years are at increased risk
of injury/death.” According to the evidence, the EMT took Ms. Kranz’s age into account
and exercised the judgment granted him by the Guidelines, a decision within the scope
of his authority under Mississippi law.
3.
Orlea Risk
Orlea Risk slipped off her bed and injured her hip [125-10], but the docket
contains no evidence of the extent and nature of her injuries. Ms. Risk’s niece stated
[125-10] that AAA employees told her that Risk “was a trauma patient and that they
could not take her to Wesley because all trauma patients had to go to Forrest General.
They also told [her] that they would ‘get in trouble’ if they took her to Wesley.”
This evidence does not demonstrate that AAA inveigled Ms. Risk. The EMT
classified Ms. Risk as a trauma patient, and it is undisputed that Wesley was not a
designated trauma center at the time of these events. As previously noted, unless they
receive contrary authorization from Medical Control, EMS providers in the SETCR
must transport trauma patients to a designated trauma center. Wesley has not
presented any evidence to dispute the EMT’s categorization of Risk as a trauma
patient. Therefore, Wesley failed to demonstrate that AAA’s transportation of Orlea
Risk was “without lawful authority.” See MISS. CODE ANN. § 97-3-53.
29
4.
Mary Ann Nester
Mary Ann Nester [125-21, 168-2], a seventy-four-year-old woman, fell forward
from a standing position, and her head landed on a metal landscaping border,
lacerating her forehead. According to AAA’s report [168-3], Ms. Nester lay on the
sidewalk when the ambulance arrived. She never lost consciousness, but she had a 3inch cut in her forehead which bled profusely despite the application of direct pressure.
Once the EMT placed Ms. Nester on the stretcher, she became nauseated and vomited,
and she vomited three more times on the way to the hospital. The EMT classified her
as a Bravo-level trauma patient and noted that she had uncontrolled bleeding and
suspected internal injuries. Nester later received sixteen stitches and a CT scan at
Forrest General.
As with patients Risk and Kranz, Wesley has failed to present evidence that
AAA’s transportation of Ms. Nester was “without lawful authority.” See MISS. CODE
ANN. § 97-3-53. The EMT categorized Nester – a patient over 55 profusely bleeding
from the head and demonstrating concussion symptoms14 – as a Bravo-level trauma
patient. As such, AAA was required by law to transport her to a designated trauma
14
The Court takes judicial notice of the fact that nausea and vomiting
following a head injury are common symptoms of a concussion. FED. R. EVID. 201(b);
see e.g. Nivens v. Signal Oil & Gas Co., 520 F.2d 1019, 1025 (5th Cir. 1975) (nausea
and dizziness are classic symptoms of a concussion); 1-C Attorneys’ Dictionary of
Medicine C-27769 (2009) (vomiting a symptom of concussion); Jarryd Werts,
Ringing the Bell on Concussions: The Rise of Head Injuries and Cognitive Decline in
Football Players, and the NFL’s Obligation to Improve Safety Measures, 11 Cardozo
Pub. L. Pol’y & Ethics J. 173, 177 (2012) (discussing symptoms of concussion and
citing sources).
30
center.
5.
John Rayner
John Rayner, a sixty-seven-year-old man weighing approximately three hundred
pounds fell off his bed. At the time, Mr. Rayner suffered from advanced liver failure.
He periodically underwent episodes of hepatic encephalopathy, a condition which his
wife described [168-7] as causing confusion, hallucinations, and the inability to
communicate or respond to inquiries. When AAA’s employees arrived [168-9], Mr.
Rayner lay prone on the floor, non-verbal, unable to assist or communicate with AAA’s
employees. According to Ms. Rayner [168-9], AAA’s employees suggested that he could
have suffered a head injury during the fall. In light of Mr. Rayner’s age, advanced liver
failure, suspected head injury, and their inability to determine his mental status, the
EMT’s exercised their judgment and declared him a Bravo-level trauma patient.
As with the other patients above, Wesley failed to present evidence that AAA’s
transportation of Mr. Rayner was “without lawful authority.” See MISS. CODE ANN. §
97-3-53. AAA’s employee categorized Rayner – a patient over 55 that had fallen from
his bed, was unable to communicate, and suffering from advanced liver failure and a
suspected head injury – as a Bravo-level trauma patient. As such, AAA was required
by law to transport him to a designated trauma center.
6.
Summary
To establish a valid RICO claim, Wesley must demonstrate that AAA kidnapped
at least two of the six patients they addressed in briefing. See 18 U.S.C. § 1961(1), (5).
As demonstrated above, Wesley failed to create a genuine dispute of material fact with
31
respect to at least five of the six patients. In those five case, either AAA had lawful
authority to transport the patient to Forrest General, or there was no evidence of
inveiglement or intent to confine them against their will. Accordingly, the Court grants
AAA’s motion for summary judgment as to Wesley’s RICO claim.
C.
Tortious Interference and Defamation
Finally, AAA argues that it is immune from liability for Wesley’s state-law tort
claims because it is an instrumentality of three political subdivisions. The Mississippi
Tort Claims Act generally provides that the State and its political subdivisions waive
sovereign immunity from suits arising from acts or omissions committed during the
course and scope of employment, except where the alleged acts or omissions constitute
fraud, malice, libel, slander, defamation, or any criminal offense besides a traffic
violation. MISS. CODE ANN. §§ 11-46-3(1), 11-46-5(1)-(2). Both defamation and tortious
interference with business relations are excepted from the MTCA’s waiver of sovereign
immunity. See Zumwalt v. Jones County Bd. of Supervisors, 19 So. 3d 672, 688 (Miss.
2009). Therefore, if AAA is a “political subdivision” within the meaning of the MTCA,
it is immune from liability for Wesley’s state-law tort claims.
The MTCA defines “political subdivision” as:
[A]ny body politic or body corporate other than the state responsible for
governmental activities only in geographic areas smaller than that of the
state, including, but not limited to, any county, municipality, school
district, charter school, volunteer fire department that is a chartered
nonprofit corporation providing emergency services under contract with
a county or municipality, community hospital as defined in Section 41-1310, airport authority, or other instrumentality of the state, whether or not
the body or instrumentality has the authority to level taxes or to sue or
be sued in its own name.
32
MISS. CODE ANN. § 11-46-1(i). “[A] private corporate entity which is responsible for
governmental activities may properly be regarded as a political subdivision under” the
MTCA. Bolivar Leflore Med. Alliance, LLP v. Williams, 938 So. 2d 1222, 1227 (Miss.
2006). In a line of cases involving tort claims against private, for-profit medical clinics,
the Mississippi Supreme Court has held that such corporations can be
“instrumentalities” of the state and, therefore, “political subdivisions” as contemplated
by Section 11-46-1(i). See Grimes v. Warrington, 982 So. 2d 365, 367-69 (Miss. 2008);
Bolivar Leflore, 938 So. 2d at 1226-32; Mozingo v. Scharf, 828 So. 2d 1246, 1254-55
(Miss. 2002).
In Mozingo v. Scharf, 828 So. 2d 1246 (Miss. 2002), a patient’s parents filed a
medical malpractice claim against an anesthesiologist who was employed as an
instructor by the University of Mississippi Medical Center and an anesthesiologist by
University Anesthesia Services, PLLC (“UAS”), a departmental practice plan at
UMMC. 828 So. 2d at 1249. The Court addressed whether the practice plan was a
governmental entity which enjoyed immunity under the MTCA. Id. at 1254-55.
The Court noted:
Medical practice plans are organized groups of physicians with medical
school faculty appointments who, in addition to research and medical
education responsibilities, provide patient care services to both insured
and uninsured patients. Most of the medical practice plans utilize UMMC
departmental personnel within their respective departments to perform
work on behalf of the medical practice plans.
Id. at 1254. The practice plan in question, UAS, was “created to provide anesthesia
services to patients at UMMC,” a “teaching hospital which functions to carry out the
33
goal of the Legislature . . . .” Id. at 1255. It was staffed by UMMC faculty members who
were state employees, prohibited from moonlighting on other jobs in private practice,
and required to participate in the hospital’s practice plans. Id. In summary, “UAS was
created because of a direct edict from the state agency charged with management of
UMMC.” Id. Therefore, it “was simply an entity created to facilitate the billing and
collection of physician fees generated by state employees,” and it was “not a private
entity.” Id.
The Mississippi Supreme Court revisited this issue in Bolivar Leflore Medical
Alliance, LLP v. Williams, 938 So. 2d 1222 (Miss. 2006). The parents of a deceased
child filed a wrongful death action against a family medical clinic, Bolivar Leflore
Medical Alliance, LLP (“BLMA”). Id. at 1224. BLMA was created by Greenwood Leflore
Hospital (“GLH”), a “community hospital” as defined by MISS. CODE ANN. § 41-13-10(c)
and two doctors. Id. at 1223. GLH owned ninety-eight percent of the clinic, while the
individuals owned two percent. Id. The clinic’s profits were distributed to the owners
in proportion to their ownership interests, and its operations were managed by a
committee created by the owners. Id. GLH controlled two-thirds of the committee,
while the individuals controlled one-third. Id. The committee possessed “full, exclusive
and complete authority, discretion, obligation and responsibility” for the clinic’s
business and operations. Id.
The Court noted:
The ultimate test for determining whether a hospital corporation is public
or private involves whether its continuity, and its control and
management, are under the power of the public through public agents
34
who are responsibly accountable to the government? The arrangement
must be such that the majority control shall remain in the public through
responsible public agents or managers.
Id. at 1227-28 (punctuation omitted, emphasis original). Accordingly, the Court held
that BLMA was an “instrumentality” of GLH. Id. at 1232. The Court observed that
GLH, a “community hospital” had “nearly total” ownership interest in BLMA and
majority control over its executive committee. Id. “Such control clearly qualifies BLMA
as an intermediary or agent through which certain functions of GLH are
accomplished.” Id.
Finally, in Grimes v. Warrington, 982 So. 2d 365 (Miss. 2008), a woman filed a
wrongful death suit against a doctor employed by Cleveland Medical Alliance (“CMA”).
Id. at 366. The facts in Grimes were almost identical to those in Boliver Leflore,
discussed above. Id. at 367. CMA was a private medical clinic. Id. at 368. Four
physician-partners owned four percent of the clinic, while Greenwood Leflore Hospital
(“GLH), a “community hospital,” owned ninety-six percent of it. Id. The partnership
agreement among the clinic’s owners gave “ultimate control” to GLH, which
“maintained majority control of the executive committee. CMA could not take any
action nor make any decision without the approval of GLH.” Id. at 369. Accordingly,
CMA was an “instrumentality” of GLH and entitled to the protections of the MTCA.
Id.
According to its corporate charter, AAA was “created and organized . . . by the
Board of Trustees of” Forrest General for the purpose of providing “public ambulance
service to the citizens and in the environs of the City of Hattiesburg, Mississippi, and
35
of the County of Forrest, State of Mississippi.”15 It is a non-profit corporation owned by
Forrest General, the City of Hattiesburg, and Forrest County – three political
subdivisions of the state of Mississippi.16 Forrest General controls two-thirds of the
voting power on AAA’s Board, while Hattiesburg and Forrest County control the
remaining third. Forrest General and AAA are parties to a General Management
Services Agreement [271-17], under which Forrest County has the authority to operate
all aspects of AAA’s services and operations. The Agreement also stipulates that all of
AAA’s key personnel must be employees of Forrest General. Accordingly, each of AAA’s
officers – its CEO, CFO, and COO – are employees of Forrest General. Additionally,
AAA’s Chairman of the Board is the Chairman, President, and CEO of Forrest General.
The Court discussed all of this evidence above in its discussion of Wesley’s
Sherman Act claim. “The ultimate test for determining whether a hospital corporation
is public or private involves whether its continuity, and its control and management,
are under the power of the public through public agents who are responsibly
accountable to the government . . . .” Bolivar Leflore, 938 So. 2d at 1227-28. There is
no genuine dispute of material fact on this issue. AAA is wholly owned by political
subdivisions, one of which – Forrest General – controls its operations. In accordance
with the Mississippi Supreme Court decisions discussed above, Court finds that AAA
15
A copy of AAA’s corporate charter can be found attached as Exhibit “A” to
AAA’s reply brief [274-1].
16
It is undisputed that Forrest General is a “community hospital” and,
therefore, a “political subdivision” within the meaning of MISS. CODE ANN. § 11-461(i).
36
is an instrumentality of the state and, therefore, entitled to the protections,
limitations, and immunities of the MTCA. Grimes, 982 So. 2d at 369; Bolivar Leflore,
938 So. 2d at 1232; Mozingo, 828 So. 2d at 1255.
The Court will briefly address Wesley’s objections to this interpretation of
Mississippi law. First, Wesley notes that an opinion from Mississippi’s Attorney
General provides: “We have previously opined that a private non-profit corporation is
not a political subdivision. We find no statute that provides that AAA, when created,
would be a political subdivision of the state . . . .” Miss. A.G. Op. No. 98-0183 (April 10,
1998), 1998 WL 22484, at *2. This argument is unavailing. In the opinion cited by
Wesley, the Attorney General’s office addressed whether AAA constitutes a “political
subdivision” under MISS. CODE ANN. § 27-55-12(1). Id. at *1. That chapter – addressing
gasoline tax – does not provide a definition of “political subdivision,” see MISS. CODE
ANN. § 27-55-5, while the MTCA includes “instrumentalities” within the definition of
a political subdivision. MISS. CODE ANN. § 11-46-1(i). Therefore, the Attorney General
addressed a completely different question than the Court faces here. Regardless, the
Attorney General’s opinion predates the Mississippi Supreme Court decisions cited
above. Even if it were on-point, it would be out-of-date.
Next, Wesley argues that AAA is an independent contractor – rather than an
instrumentality – of Forrest General, Hattiesburg, and Forrest County. Wesley cites
a line of cases addressing whether government contractors are entitled to immunity
under the MTCA. The Mississippi Supreme Court has held that “a private company
and its employees who provide government activities via contract with a political
37
subdivision are not immune from liability under the MTCA.” Poppenheimer v. Coyle,
98 So. 3d 1059, 1065 (Miss. 2012); see also Flye v. Spotts, 94 So. 3d 240, 247-48 (Miss.
2012). But an “independent contractor” is “a person who contracts with another to do
something for him but who is not controlled by the other nor subject to the other’s right
to control with respect to his physical conduct in the performance of the undertaking.”
Poppenheimer, 98 So. 3d at 1064. Forrest General controls AAA and its operations.
Therefore, AAA is not an independent contractor.
For all of the reasons stated above, the Court finds that AAA is an
“instrumentality” of Forrest General and, therefore, entitled to immunity from
Wesley’s claims of defamation and intentional interference with business relations.
MISS. CODE ANN. §§ 11-46-1(i), 11-46-3(1), 11-46-5(1)-(2); Zumwalt, 19 So. 3d at 688.
Accordingly, the Court grants AAA’s motion for summary judgment as to those claims.
V. REMAINING MOTIONS
A.
Motion to Dismiss [150]
AAA argues that the Court should dismiss Count One of the Second Amended
Complaint – Wesley’s request for declaratory relief – for Wesley’s failure to join the
State of Mississippi as an indispensable party. As the Court previously noted [144], it
can not address Wesley’s claims regarding the constitutionality of the Destination
Guidelines unless Wesley joins the State of Mississippi. See FED. R. CIV. P. 19(a)(1)(B);
Hefner, 779 F.2d at 282; Lewis, 792 F.2d at 496 n. 2.
The Court previously held that it would allow Wesley to join the State if it
became necessary to address the constitutionality of the Destination Guidelines. It
38
would be inequitable to now dismiss the constitutional claim and preclude Wesley from
doing so. AAA’s Motion to Dismiss [150] is denied.
B.
Motion to Exclude [251]
The Court denies as moot Wesley’s Motion to Exclude Expert Testimony [251].
C.
Motion to Strike [264]
The Court denies as moot Wesley’s Motion to Strike [264] Exhibit 26 to AAA’s
Motion for Summary Judgment. The Court did not consider the disputed exhibit.
D.
Motion to Dismiss in Part [266]
Finally, the Court denies as moot AAA’s Motion to Dismiss in Part as Moot
[266].
VI. CONCLUSION
For the reasons stated above, the Court rules as follows:
•
The Court denies Wesley’s Motion for Declaratory Judgment and
Injunctive Relief [168];
•
The Court grants Forrest General’s Motion for Summary
Judgment [253];
•
The Court grants AAA’s Motion for Summary Judgment [255, 261,
270];
•
The Court denies AAA’s Motion to Dismiss [150]; and
•
The Court denies as moot Wesley’s Motion to Exclude Expert
Testimony [251], Wesley’s Motion to Strike [264], and AAA’s
Motion to Dismiss in Part [266].
SO ORDERED AND ADJUDGED this, the 22nd day of January, 2014.
s/Keith Starrett
UNITED STATES DISTRICT JUDGE
39
40
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?