Chaudhry v. Smith

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8 UNITED STATES DISTRICT COURT

9 EASTERN DISTRICT OF CALIFORNIA

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PERVAIZ A. CHAUDHRY, M.D., et al., Case No. 1:16-cv-01243-SAB

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Plaintiffs, MEMORANDUM OF DECISION

12 FOLLOWING BENCH TRIAL AND ORDER

v. ENTERING JUDGMENT IN FAVOR OF

13 DEFENDANTS AND DIRECTING CLERK

SONIA ANGELL, et al., OF COURT TO CLOSE CASE

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Defendants. ORDER DENYING PLAINTIFFS’

15 MOTIONS FOR ADMISSION OF

TESTIMONY AND DEPOSITION

16 DESIGNATIONS AND GRANTING

DEFENDANT’S MOTION TO STRIKE

17 COUNTER-DESIGNATIONS

18 (ECF Nos. 160, 170, 173-182)

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I.

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INTRODUCTION

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Pervaiz A. Chaudhry, M.D. (“Dr. Chaudhry”) and Valley Cardiac Surgery Medical

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Group (“Valley Cardiac”) (collectively “Plaintiffs”), filed this civil rights action that proceeded

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into trial against Defendants Sonia Angell (“Angell”), in her official capacity as the Director of

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the California Department of Public Health (“CDPH”), Steven Lopez (“Lopez”), in his personal

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capacity, and Shirley Campbell (“Campbell”), in her personal capacity, alleging a violation of

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due process pursuant to 42 U.S.C. § 1983.

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Following a waiver by all parties of their right to a jury trial, a bench trial was held before

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1 the undersigned on May 4, 2021, through May 10, 2021. Having considered the testimony of the

2 witnesses and those exhibits that were admitted at trial, the Court, by this memorandum of

3 decision, issues its findings of fact and conclusions of law pursuant to Rule 52(a) of the Federal

4 Rules of Civil Procedure. For the reasons set forth below, the Court concludes that Plaintiffs

5 have not proven a violation of their due process rights and are not entitled to relief on any of

6 their claims.

7 A. Jurisdiction and Venue

8 This Court has original jurisdiction under 28 U.S.C. §§ 1331, 1441(a), in that this action

9 arises under alleged violations of the Constitution of the United States. Venue is proper because

10 the events that underlie this action occurred in the Eastern District of California, and in

11 particular, Fresno County.

12 B. Relevant Procedural history

13 On June 17, 2016, Plaintiffs Dr. Chaudhry and Valley Cardiac filed a complaint in Fresno

14 County Superior Court against Defendants Karen Smith (“Smith”), Lopez, Eric Creer (“Creer”),

15 Campbell, and Deidre Kappmeyer (“Kappmeyer”). (ECF No. 1 at 10-30.) On August 19, 2016,

16 Defendants removed the action to the Eastern District of California. (ECF No. 1.) On August

17 29, 2016, Plaintiffs filed a first amended complaint bringing two causes of action. (ECF No. 6.)

18 Both causes of action allege the violation of civil rights and due process pursuant to 42 U.S.C. §

19 1983. Plaintiffs’ first cause of action was brought against Defendant Smith in her official

20 capacity, seeking declaratory and injunctive relief. (FAC ¶¶ 62-71, ECF No. 6.) Plaintiffs’

21 second cause of action was brought against Defendants Lopez, Campbell, Creer, and

22 Kappmeyer, in their personal capacities, seeking monetary damages for emotional distress to Dr.

23 Chaudhry, as well as economic harm to each of the Plaintiffs. (FAC ¶¶ 72-76, ECF No. 6.)

24 On December 16, 2016, District Judge Lawrence J. O’Neill denied Defendants’ motion to

25 dismiss in its entirety. (ECF No. 12.) On January 26, 2017, Defendants filed an answer to

26 Plaintiffs’ first amended complaint. (ECF No. 13.) On January 18, 2019, District Judge O’Neill

27 issued an order granting a motion for summary judgment as to Defendant Eric Creer only, and

28 denying the motion for summary judgment as to Defendants Smith, Lopez, Campbell, and

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1 Kappmeyer. (ECF No. 56.) The order further directed the parties to either dismiss Kappmeyer,

2 who is now deceased, or substitute a proper defendant, and on January 28, 2019, the Court

3 dismissed Kappmeyer pursuant to the parties’ stipulation. (ECF No. 60.)

4 On February 14, 2019, pursuant to the parties’ consent to magistrate judge jurisdiction,

5 this action was assigned to Magistrate Judge Stanley A. Boone for all purposes, including trial

6 and entry of final judgment. (ECF No. 64.) On February 21, 2020, the Court issued an order

7 adjudicating the parties’ motions in limine. (ECF No. 97.)

8 On March 18, 2020, pursuant to the parties’ stipulation and Federal Rule of Civil

9 Procedure 25(d), the Court ordered Defendant Angell, in her official capacity as the Director of

10 the CDPH, to be substituted in place of Defendant Smith. (ECF No. 101.)

11 On March 18, 2020, the parties filed a stipulation for the withdrawal of Dr Chaudhry’s

12 request for damages relating to emotional distress or physical manifestations of emotional

13 distress. (ECF No. 102.) On March 19, 2020, pursuant to the parties’ stipulation, the Court

14 entered an order withdrawing Dr. Chaudhry’s requests for damages which were “claim[ed] to

15 have been proximately caused by Defendants’ conduct, including but not limited to depression,

16 anxiety, sleeplessness, and cluster headaches,” and further ordered that “Plaintiffs shall not

17 introduce any evidence whatsoever in support of the general damages claims or to request

18 damages for such claims.” (ECF No. 103.) In relation to the withdrawal of Dr. Chaudhry’s

19 claims for emotional distress, on March 30, 2020, Plaintiffs submitted supplemental briefing,

20 which the Court construed as a motion for reconsideration of the Court’s February 21, 2020

21 order on the parties’ motions in limine. (ECF No. 104.) On April 27, 2020, the Court granted in

22 part and denied in part the construed motion for reconsideration of the motions in limine. (ECF

23 No. 110.)

24 On March 12, 2021, Defendants filed, and on March 18, 2021, Plaintiffs filed, notices

25 withdrawing their demand for a jury trial, waiving their right to a jury trial, and consenting to a

26 bench trial before the undersigned. (ECF Nos. 136, 141.)

27 On May 4, 2021, a bench trial commenced in this action on Plaintiffs’ claims against

28 Defendant Angell in her official capacity, and Defendants Lopez and Campbell in their

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1 individual capacities. (ECF No. 173.) Plaintiffs were represented at trial by counsel Hadi Ty

2 Kharazi and Thornton Davidson. Defendants were represented at trial by counsel Diana

3 Esquivel. On May 10, 2021, the evidence was closed and the trial concluded. (ECF No. 182.)

4 II.

5 OUTSTANDING EVIDENTIARY RULINGS

6 The Court addresses three remaining evidentiary issues: (A) Plaintiffs’ request to admit

7 the testimony of Laura McComb (“McComb”) from a different preceding trial; (B) Plaintiffs’

8 late-filed designations of the deposition testimony of Adams Yussif (“Yussif”), from the same

9 preceding litigation; and (C) Defendants’ objections and request to strike Plaintiffs’ counter

10 deposition designations of Berj Apkarian (“Apkarian”) and Kalwant Dhillon (“Dhillon”), also

11 from the same preceding litigation.

12 A. Testimony of Laura McComb

13 Prior to the close of evidence in the bench trial held in this action, Plaintiffs filed a brief

14 in support of the admission of testimony given by third party witness McComb in the prior

15 separate action of Alvarez v. Fresno Community Hospital, et al., Fresno Superior Court Case No.

16 13CECG03906 (“Alvarez” or the “Perez Malpractice Case”). (Pls.’ Limited Brief Supp.

17 Admission Trial Testimony Laura McComb (“Br.”), ECF No. 177.)

18 1. Plaintiffs’ Arguments

19 Plaintiffs seek to admit the testimony from Alvarez wherein McComb testified

20 concerning the drafts of the “Plans of Correction,”1 and specifically previous testimony from

21 McComb stating the initial proposed Plan of Correction was “rejected because the hospital had

22 not been specific enough in its discipline of Dr. Chaudhry.” (Br. 2.) Plaintiffs proffer the

23 testimony is about “Campbell pressuring the hospital to more harshly[]discipline Dr. Chaudhry.”

24 (Br. 3.) Plaintiffs submit the testimony is highly relevant because it tends to show the

25 Defendants’ investigations and reports specifically sought to injure Dr. Chaudhry’s reputation,

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These evidentiary rulings precede the main factual findings and legal analysis in this memorandum. The Court

27 incorporates the below factual findings and legal analysis by way of reference as to obviate the need to define terms

and explain relevance of certain facts that are more fully developed in the later sections of this memorandum.

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1 by forcing the hospital, under threat of losing Medicare funding, to remove him from his

2 position, and further impeaches Campbell. (Br. 3.)

3 Plaintiffs first argue that the introduction of McComb’s prior testimony should be

4 permitted under Federal Rule of Evidence 804(b)(1) as she is an unavailable witness due to the

5 inability to recollect the subject matter. (Br. 3-5.) Second, Plaintiffs argue McComb’s prior

6 testimony should be admitted as a statement against interest under Federal Rule of Evidence

7 804(b)(3), because as an employee of the hospital, she was risking her employment and the

8 hospital’s funding for Medicare and Medicaid by exposing the actions of the CDPH

9 investigators. (Br. 5.) Alternatively, Plaintiffs argue McComb’s testimony may also be

10 introduced because she is “feigning forgetfulness,” and given the prior sworn statements, the

11 Court may admit those statements under the exception for prior sworn inconsistent statements

12 “despite the fact that present forgetfulness is not technically inconsistent with the prior

13 statements.” (Br. 5.)

14 2. Legal Standard

15 “A deposition lawfully taken . . . may be used in a later action involving the same subject

16 matter between the same parties, or their representatives or successors in interest, to the same

17 extent as if taken in the later action.” Fed. R. Civ. P. 32(a)(8). The Rules of Evidence provide a

18 parallel exception. “A declarant is considered to be unavailable as a witness if the declarant: . . .

19 testifies to not remembering the subject matter,” Fed. R. Evid. 804(a)(3), and the following types

20 of former testimony are not by excluded by the rule against hearsay if the declarant is

21 unavailable: (A) testimony that “was given as a witness at a trial, hearing, or lawful deposition,

22 whether given during the current proceeding or a different one; and (B) is now offered against a

23 party who had--or, in a civil case, whose predecessor in interest had--an opportunity and similar

24 motive to develop it by direct, cross-, or redirect examination,” Fed. R. Evid. 804(b)(1).

25 A statement against interest is not excluded as hearsay if the statement is one that: “(A) a

26 reasonable person in the declarant’s position would have made only if the person believed it to

27 be true because, when made, it was so contrary to the declarant’s proprietary or pecuniary

28 interest or had so great a tendency to invalidate the declarant’s claim against someone else or to

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1 expose the declarant to civil or criminal liability; and (B) is supported by corroborating

2 circumstances that clearly indicate its trustworthiness, if it is offered in a criminal case as one

3 that tends to expose the declarant to criminal liability.” Fed. R. Evid. 804(b)(3).

4 “The decision whether to admit a deposition from a prior lawsuit is vested in the district

5 court’s sound discretion.” Hub v. Sun Valley Co., 682 F.2d 776, 777 (9th Cir. 1982). The

6 requirements of “same subject matter” and “same parties, or their representatives or successors in

7 interest” “have been construed liberally in light of the twin goals of fairness and efficiency.”

8 Hub, 682 F.2d at 778 (“The accepted inquiry focuses on whether the prior cross-examination

9 would satisfy a reasonable party who opposes admission in the present lawsuit.”). Thus, “courts

10 have required only a substantial identity of issues . . . and the presence of an adversary with the

11 same motive to cross-examine the deponent.” Id. (citations omitted) (“We too believe that the

12 two lawsuits need not involve identical issues and parties, though we reserve for another day

13 deciding whether the presence of an adversary with the same motive to cross-examine is

14 sufficient.”); see also Hynix Semiconductor Inc. v. Rambus Inc., 250 F.R.D. 452, 458 (N.D. Cal.

15 2008) (“The modern test does not require privity between the current party and the party who

16 participated in the prior proceeding.”).

17 3. Plaintiffs’ Motion Shall be Denied

18 The Court will accept for purposes of this motion that given McComb testified she did

19 not recall the conversations regarding the Plans of Correction, she is unavailable for purposes of

20 Rule 804(a)(3) as to that specific subject matter.2 However, the Court finds Defendants are not

21 successors in interest to the Plaintiffs in the Perez Malpractice Case in a manner sufficient as to

22 satisfy Rule of Evidence 804(b)(1), nor Rule of Civil Procedure 32(a)(8), even under the liberal

23 interpretations of such rules. See Hub, 682 F.2d at 778; Hynix, 250 F.R.D. 452, 458 (“[T]he test

24 is ‘inherently factual’ and depends on the similarity of issues and context of questioning.”).

25 Plaintiffs argue “Alvarez was a predecessor in interest of CDPH because they both shared

26 a common interest in upholding and defending the investigative report that impugned Dr.

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The Court addresses this and related testimony of McComb and Utecht in relation to some of the issues discussed

28 in this evidentiary motion in Sections III(D)-(E) and IV(C)(2), infra.

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1 Chaudhry for committing medical errors in the context of his treatment of Mr. Perez.” (Br. 5.)

2 The Court rather agrees with Defendants and finds that no party in the Perez Malpractice Case

3 had a common interest with Defendants Campbell, Lopez, or CDPH. The focus of the

4 malpractice action was Dr. Chaudhry’s conduct and the standard of care as a physician, whereas

5 the hospital and its compliance with its policies and as to the federal Conditions of Participation

6 for Medicare and Medicaid, was the subject of the investigations and reports at issue in this

7 action.

8 Plaintiffs heavily depend on a previous findings and recommendations from the

9 undersigned, Howell v. Cruz, No. 119CV00782DADSABPC, 2020 WL 6700178, at *5 (E.D.

10 Cal. Nov. 13, 2020), report and recommendation adopted, No. 119CV00782DADSABPC, 2021

11 WL 24756 (E.D. Cal. Jan. 4, 2021). (Br. 4.) In Howell, the plaintiff was the same as in “his

12 other ongoing cases,” and “[a]lthough the Defendants [were] different, they [were] all employees

13 of CDCR, and in Burns, employees specifically at CSP-Corcoran.” 2020 WL 6700178, at *5.

14 As the undersigned noted therein, “the general subject matter of exhaustion and the fact that

15 Plaintiff [was] familiar with the process [was] the same in the cases,” and “[a]t each of the prior

16 depositions an adversary was present to examine Plaintiff regarding his familiarity with CDCR’s

17 administrative grievance process [and] [i]ndeed, motions for summary judgment on

18 administrative exhaustion grounds are pending in both of Plaintiff's other ongoing cases.” Id.

19 (“Therefore, Plaintiff’s deposition transcripts from his two other cases are admissible for

20 consideration in ruling on the instant motion.”).

21 The motives of the CDCR employees in deposing the plaintiff in Howell were similar if

22 not identical. There is no indication that the plaintiff in the Perez Malpractice Action had a

23 sufficiently similar motive to develop testimony on the relevant issues as Defendants in this

24 action. See Hynix, 250 F.R.D. at 458 (N.D. Cal. 2008) (“With respect to Mr. Kalter and Mr.

25 Kilbuck, the issues and motives were identical.”); Hub, 682 F.2d at 778 (“The shortcoming here

26 is that Hub failed to show that the deposition relates to issues common to both lawsuits.”);

27 Shahbaz v. Johnson & Johnson, No. CV 13-07382-AB (SSX), 2020 WL 5894590, at *15 (C.D.

28 Cal. July 31, 2020) (“Defendants were not parties to either of those cases, and Plaintiff has not

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1 shown that the subject matter in those actions is similar to that of this case, or even involved

2 Prolene.”); Affinity Labs of Texas, LLC v. Apple Inc., No. C 09-04436 CW, 2011 WL 232521,

3 at *2 (N.D. Cal. Jan. 24, 2011) (Hynix “is not analogous to this case.”).

4 As for Plaintiffs’ argument that McComb’s testimony should be admitted as a statement

5 against self-interest, Defendants argue there is no evidence demonstrating her employment or the

6 hospital’s relationship with the Centers for Medicaid & Medicare Services (CMS) was in

7 jeopardy or threatened. The Court agrees. Plaintiffs have failed to show that McComb risked

8 her employment or the hospital’s relationship with CMS as Plaintiffs, argue, and significantly,

9 McComb testified at trial that disagreements were not uncommon with CDPH, and specifically

10 that it was not surprising when CDPH stated it would not change certain aspects of CDPH’s

11 reports concerning alleged misquotations, because the CDPH has their “truth” and interpretation

12 of the facts, and the hospital has its own, and they do not always agree with each other. See Cty.

13 of Stanislaus v. Travelers Indem. Co., 142 F. Supp. 3d 1065, 1076–77 (E.D. Cal. 2015) (“ ‘A

14 statement is against pecuniary and proprietary interest when it threatens the loss of employment,

15 or reduces the chances for future employment, or entails possible civil liability’ . . . nothing in

16 the record suggests that Franck was responsible for those excavations or that the statements were

17 against his pecuniary interest for some other reason.”) (quoting Gichner v. Antonio Troiano Tile

18 & Marble Co., 410 F.2d 238, 242 (D.C. Cir. 1969)).

19 The Court also rejects Plaintiffs’ alternative argument that McComb’s prior testimony

20 should nevertheless be admitted because she is “feigning forgetfulness.” (Br. 5.) The Court

21 agrees with Defendants that whether McComb feigned forgetfulness goes to the weight of her

22 testimony, not the admissibility of her prior sworn testimony, and is not a legal basis for

23 admitting the prior testimony. The Court addresses the credibility, weight, and relevance of

24 McComb’s testimony in the factual findings and legal analysis sections of this memorandum.

25 Further, even if the Court were inclined to admit the testimony under the above

26 exceptions, the Court agrees with Defendants that the testimony sought to be introduced is

27 vague, and though possibly relevant if was in line with what Plaintiffs frame it to be, it is

28 irrelevant as presented and in the context of what McComb actually stated in the previous Perez

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1 Malpractice Case. First, Defendants correctly highlight that the proffered testimony does not

2 refer to whether the Plan of Correction is referring to the CMS, or State report. Further, the prior

3 testimony does not state that Campbell or CDPH was “pressuring the hospital to more harshly

4 discipline Dr. Chaudhry” as Plaintiffs assert, but rather, McComb specifically answered “no” to

5 the question of whether CDPH told McComb they wanted Dr. Chaudhry disciplined more

6 severely:

7 Q. Now, I’m not asking you anything about any of the changes that you made

in the plan of correction, but what was the primary complaint that Shirley

8 Campbell voiced to you about the first plan of correction that was rejected?

9 A. The primary complaints dealt with the specificity of the education, listing

it out, and the specificity of what occurred in the disciplinary measures for Dr.

10 Chaudhry.

11 Q. And so is it correct that the State wanted you – the State is telling you that

they want harsher discipline visited on Dr. Chaudhry in this plan of correction; is

12 that right?

13 A. No. They wanted it specified clearly. Instead of saying MEC met on 8-12

and discussed the incident and levied a suspension, she wanted it clearly laid out

14 what education, what suspension, everything that MEC had for that particular

incident.”

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Q. Did she tell you that verbally, is that over the telephone or how is that

16 communicated?

17 A. In talking with her or Steve [Lopez], yes.

18 (Br. 10-11.)

19 Thus the testimony in fact shows that if anything, McComb recalled Campbell or Lopez

20 at CDPH wanted the Plan of Correction to state more clearly what the punishment actually was

21 that was in place already, not that they wanted Dr. Chaudhry punished more severely by the

22 hospital.

23 For all of the above reasons, Plaintiffs’ motion to admit the prior trial testimony of

24 McComb from the Perez Malpractice Case shall be denied.

25 B. Plaintiffs’ Late-Filed Request to Designate Deposition Testimony of Adams

Yussif

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27 On May 7, 2021, the morning of the fourth day of trial in this action, Plaintiffs filed a

28 notice of designation of deposition testimony of Yussif. (ECF No. 176.) On May 10, 2021,

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1 while mounting specific objections to certain designations as an alternative argument,

2 Defendants objected to the entirety of Plaintiffs’ designations on the grounds they were untimely

3 and unduly prejudicial to Defendants. (ECF No. 179.) For the reasons explained below,

4 Plaintiffs’ late-filed request to designate the deposition testimony of Yussif shall be denied.

5 Plaintiffs filed no formal motion or express request to amend the pretrial order to allow

6 for their untimely deposition designations. The Court will nonetheless construe the filing as a

7 motion to amend the pretrial order. See Fresno Rock Taco, LLC v. Nat’l Sur. Corp., No. 1:11-

8 CV-00845-SKO, 2013 WL 2182864, at *7 (E.D. Cal. May 20, 2013). On such a motion,

9 Plaintiffs have “the burden of showing that an amendment to the pretrial order was necessary to

10 prevent “manifest injustice.” Galdamez v. Potter, 415 F.3d 1015, 1020 (9th Cir. 2005); see Fed.

11 R. Civ. P. 16(e) (“The court may modify the order issued after a final pretrial conference only to

12 prevent manifest injustice.”). In evaluating a motion to amend the pretrial order, the Court

13 “should consider four factors: (1) the degree of prejudice or surprise to the defendants if the

14 order is modified; (2) the ability of the defendants to cure the prejudice; (3) any impact of

15 modification on the orderly and efficient conduct of the trial; and (4) any willfulness or bad faith

16 by the party seeking modification.” Galdamez, 415 F.3d at 1020. The Court has the discretion

17 to exclude the proffered evidence if the pretrial order is violated. See Local Rule 283(c); Fed. R.

18 Civ. P. 16(f)(1)(C) (“On motion or on its own, the court may issue any just orders, including

19 those authorized by Rule 37(b)(2)(A)(ii)-(vii), if a party or its attorney . . . fails to obey a

20 scheduling or other pretrial order.”); Fed. R. Civ. P. 37(b)(2)(A)(ii) (“prohibiting the disobedient

21 party . . . from introducing designated matters in evidence”); Lind v. United States, No. CV-13-

22 00032-TUC-JAS, 2016 WL 11652879, at *2 (D. Ariz. July 6, 2016) (“The Court holds that all of

23 Plaintiff’s untimely evidence implicated in the three motions at bar are excluded as time-barred

24 by this Court’s Scheduling Orders; this untimely evidence will not be considered by the Court

25 and will not be admissible for any purpose at the trial in this case.”).

26 The Court finds the degree of prejudice or surprise to the Defendants is substantial, given

27 the Plaintiffs’ designations were not submitted until May 7, 2021, the morning of the fourth day

28 of trial, which was the last day any witnesses testified, and after almost all witnesses that had

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1 completed testimony had been excused. Defendants did not have proper time to properly

2 counter-designate deposition testimony. Some ability to cure prejudice was present given

3 Defendants did mount objections to specific designations, though under time-pressure given they

4 were filed on May 10, 2021, following the weekend break after the trial day May 7, 2021, and

5 submitted while preparing for closing arguments that were held on Monday May 10, 2021, and

6 while submitting a response to Plaintiffs’ motion to admit the testimony of McComb. (ECF Nos.

7 176, 177, 179, 180, 182.) However as Defendants stated in opposition, they were unable to

8 submit counter designations to address many portions of the belated designations. (ECF No. 179

9 at 2.)

10 Given the designations were not submitted until the morning of the fourth day of trial,

11 and the final day that witnesses presented testimony, there is a substantial impact on the orderly

12 and efficient conduct of the trial. As explained in Defendants’ filing: the parties appeared for a

13 status conference on April 22, 2021 (ECF No. 149); Defense counsel informed the Court that

14 Yussif was not available to testify at trial because of his serious medical condition; counsel for

15 Plaintiffs agreed that Yussif’s deposition testimony given in the Perez Malpractice Case would

16 be used at trial in lieu of his live testimony; the Court ordered the parties to file deposition

17 designations for Yussif by April 26, 2021, and counter designations by April 29, 2021 (ECF No.

18 150); Defendants timely filed their designations (ECF No. 162); Plaintiffs did not file any

19 designations, nor object to Defendants’ designations by the deadlines; and instead filed the

20 designations on May 7, 2021. These facts also tend to show a willfulness, or at least a

21 carelessness, underlying the failure by Plaintiffs to timely designate.

22 Accordingly, in consideration of the above factors and the pretrial order in this matter, the

23 Plaintiffs’ construed motion to modify the pretrial order to designate deposition testimony of

24 Yussif shall be denied, and the late-filed deposition designations of Yussif shall be excluded

25 from consideration as evidence. See Galdamez, 415 F.3d at 1020; Fresno Rock Taco, 2013 WL

26 2182864; Local Rule 283(c); Fed. R. Civ. P. 16(f)(1)(C).

27 C. Deposition Designations of Berj Apkarian and Kalwant Dhillon

28 On April 26, 2021, in submitting objections and counter-designations to Defendants’

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1 deposition designations, Plaintiffs designated testimony of Apkarian and Dhillon as counter-

2 designations, despite the fact that Defendants designated no testimony from Apkarian or Dhillon.

3 (ECF No. 160 at 3-4.) On April 29, 2021, Defendants submitted objections and a motion to

4 strike the counter designations of Apkarian and Dhillon. (ECF No. 170.) Defendants argue that

5 Plaintiffs’ counter-designations violate Federal Rule of Civil Procedure 32 and the Court’s

6 pretrial orders because Defendants did not designate any portion of the Apkarian and Dhillon

7 depositions, and thus these are not proper counter-designations. (Id.)

8 Under Rule 32, after a party has offered part of a deposition into evidence, the opposing

9 party “may require the offeror to introduce other parts that in fairness should be considered with

10 the part introduced, and any party may itself introduce any other parts.” Fed. R. Civ. P. 32(a)(6);

11 see also Fed. R. Evid. 106 (“If a party introduces all or part of a writing or recorded statement, an

12 adverse party may require the introduction, at that time, of any other part . . . that in fairness

13 ought to be considered at the same time.”); In re Pac. Fertility Ctr. Litig., No. 18-CV-01586-JSC,

14 2021 WL 2075560, at *1 (N.D. Cal. May 24, 2021) (“This principle is known as the rule of

15 completeness and it exists to avert misunderstanding or distortion caused by introduction of only

16 part of a document or recording.”) (quoting United States v. Vallejos, 742 F.3d 902, 905 (9th Cir.

17 2014)) (internal quotation marks omitted).

18 Defendants argue Plaintiffs seek to use the deposition testimony of Apkarian and Dhillon

19 not to complete the testimony of any witness’ deposition testimony that Defendants designated,

20 but rather to rebut or introduce additional testimony they failed to timely designate. (ECF No.

21 170 at 2.) Defendants argue this is improper under Rule of Procedure 32 and Rule of Evidence

22 106, as they do not permit using one witness’ testimony to complete the testimony of another,

23 and do not allow for rebuttal of designated testimony. (Id.) The Court agrees.

24 Plaintiffs submitted a response to Defendants’ objections on April 30, 2021. (ECF No.

25 172.) Plaintiffs argue that they had subpoenaed Yussif who interviewed these doctors; within the

26 last two weeks before the filing, Plaintiffs were notified that Yussif was not available to attend

27 trial due to his illness; Yussif’s absence required a counter-designation of Apkarian; Plaintiffs

28 did not have Apkarian under subpoena because Plaintiffs planned on Yussif testifying;

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1 Defendants filed a revised report which raises “new issues”; and Defendants’ extensive

2 designations of Bella Albakova require the designation of Dhillon’s testimony. (ECF No. 172.)

3 The Court does not find Plaintiffs’ generalized and vague arguments availing. The Court

4 has reviewed the designations of Apkarian and does not find anything that would only be

5 relevant because of the absence of Yussif as a witness at trial. None of the designations of

6 Apkarian specifically mention Yussif. Further, while Plaintiffs proffer that Yussif interviewed

7 both of “these doctors” (ECF No. 172 at 2), it is an undisputed fact that Yussif did not interview

8 Dhillon during his investigation. (UF 14, ECF No. 88 at 4.) Further, given Dhillon was a

9 surgeon and primary witness present in the operating room, it is not clear why all of a sudden the

10 fact that Defendants designated testimony from Albakova, designation of testimony from Dhillon

11 is necessary. Plaintiffs should have been keenly aware of any need to designate the testimony of

12 Dhillon well before any testimony of Albakova was designated.

13 Aside from the Court not being swayed by these specific arguments offered by Plaintiffs,

14 more importantly, the Court finds the counter-designations are not appropriate counter-

15 designations under Federal Rule of Civil Procedure 32(a)(6), nor Federal Rule of Evidence 106.

16 See Phoenix Techs. Ltd. v. VMware, Inc., No. 15-CV-01414-HSG, 2017 WL 2001981, at *10

17 (N.D. Cal. May 11, 2017) (“The burden of establishing the applicability of the rule of

18 completeness falls on the party seeking to have a counter-designation played in the other party’s

19 case.”). Plaintiffs provide no legal authority or legal argument rebutting Defendants’ arguments

20 that would refute the clear application of these rules. Further, aside from failing to correspond to

21 any deposition testimony from Dhillon or Apkarian designated by Defendants, as Defendants did

22 not designate any, the counter-designations failed to identify any testimony designated from any

23 witness that these counter-designations seek to address or complete such that no adequate

24 evaluation can be made whether these designations are appropriate under the rule of

25 completeness.

26 Further, if considered designations and not counter-designations, Plaintiffs’ proffered

27 designations would be untimely in violation of the Court’s fifth amended pretrial order and April

28 14, 2021 order requiring the parties to file deposition designations on or before April 20, 2021.

13

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1 (ECF Nos. 134, 145.) Plaintiffs did not seek leave to file late designations and provided no

2 accompanying motion, request, or proffered reasonable justification for the late disclosures until

3 Defendants submitted objections. Alternatively, even if the Court were to construe Plaintiffs’

4 April 30, 2021 response as a motion to modify the pretrial order to allow for the designation of

5 the depositions of Apkarian and Dhillon, such motion would be denied and the late-filed

6 deposition designations of Apkarian and Dhillon would be excluded, under the standards

7 discussed in the previous subsection. See Galdamez, 415 F.3d at 1020; Fresno Rock Taco, 2013

8 WL 2182864; Local Rule 283(c); Fed. R. Civ. P. 16(f)(1)(C). Specifically, the Court finds: (1)

9 the prejudice to Defendants outweighs any need to modify the pretrial order; (2) there was

10 limited ability for Defendants to cure such prejudice on the eve of trial; and (3) the modification

11 to the orderly and efficient conduct of the trial is substantial given such prejudice.

12 Accordingly, in consideration of the above, the Defendants’ objections are sustained, and

13 Defendants’ request to strike Plaintiffs’ deposition designations of Apkarian and Dhillon shall be

14 granted.

15 III.

16 FINDINGS OF FACT

17 The Court makes the following findings of fact based on the documentary and testimonial

18 evidence introduced at trial, as well as the undisputed facts stipulated to by the parties and

19 entered into the record through the Court’s December 4, 2019 pretrial order. (ECF Nos. 87, 88,

20 89.) The Court has considered the credibility of the testifying witnesses and documentary

21 evidence in resolving conflicts and determining the weight given to such evidence when

22 determining these findings of fact.

23 A. The Perez Surgery

24 At all relevant times, Plaintiff Dr. Chaudhry, was a cardiothoracic surgeon with Plaintiff

25 Valley Cardiac, and had substantial financial and leadership interests in Valley Cardiac. In 2007

26 Dr. Chaudhry joined Community Regional Medical Center (“CRMC”), located in Fresno,

27 California. Dr. Chaudhry became the busiest heart surgeon in the state of California, completing

28 about 300-350 surgeries per year, and testified that over the course of about 8 years, had

14

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1 completed about 2,000 heart surgeries. Dr. Chaudhry was instrumental in making CRMC the

2 busiest private heart surgery program in California, excluding programs such as Kaiser

3 Permanente, or university hospitals.

4 During heart surgery, the sternum is cut, the ribs are not cut from the sternum. About ten

5 to fifteen minutes after the bypass portion of the surgery is completed, the patient usually comes

6 off the heart and lung machine (often referred to as the “pump”), which is operated by the

7 perfusionist. The chest is open and the surgeon and staff observe the heart as the heart and lung

8 machine is slowed down; then when the heart is tolerating the transition and there is no bleeding,

9 the patient can gradually come off the heart and lung machine, and the machine can be shut

10 down. The surgeon then removes the catheter lines, and the chest is closed. Surgeons are

11 generally not required to stay with patients throughout the entire recovery. The anesthesiologist

12 is required to stay until the patient is awake to let the drugs wear off over three to five hours, and

13 once the anesthesiologist feels the patient is well enough, the patient goes to the intensive care

14 unit under the care of nursing staff.

15 On April 2, 2012, Dr. Chaudhry performed an open-heart surgery on a patient by the

16 name of Silvino Perez (“Patient” or “Perez”). This surgery was performed at CRMC in Fresno,

17 California. The diagnosis for Perez, both preoperative and postoperative, was (a) ascending

18 aortic aneurysm, and (b) aortic valve stenosis, bicuspid valve. Present in the operating room for

19 the surgery, in addition to Dr. Chaudhry, were the following: (a) the assistant surgeon Kalwant

20 Dhillon, M.D. (“Dhillon”); (b) the anesthesiologist Ashwin Bhatt, M.D. (“Bhatt”); (c) the

21 physician assistant Bella Albakova (“Albakova”); (d) the perfusionist Aaron Schreur

22 (“Schreur”); (e) the scrub nurse Martha Allen (“Allen”); (f) a circulating nurse Geri Breaux

23 (“Breaux”); and (g) another circulating nurse Nichole Kroes (“Kroes”).

24 By April of 2012, Dr. Chaudhry had worked with Dhillon since 2005; with Bhatt for at

25 least 1500 cases; with Allen, Kroes, and Breaux for hundreds of surgeries; with Albakova for

26 hundreds if not thousands of surgeries; and with Schreur for about five (5) years and about 250

27 surgeries. Prior to the Perez surgery, Dr. Chaudhry witnessed no animosity by Schreur toward

28 Dr. Chaudhry; had disagreements with Allen but didn’t feel she had animosity toward him; and

15

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1 witnessed no animosity by Allen or Breaux.3

2 Dr. Chaudhry generally dictates post-operative notes in the operating room at the

3 dictation table, then goes to the surgery table to make sure the patient is stable, then leaves. The

4 dictation table is about five to seven feet from the operating table. (Exs. 116, 117.) The

5 perfusionist Schreur would generally prepare a perfusion record or summary of the operation,

6 and provide that information to Dr. Chaudhry to finish the post-operative reports. In this case,

7 Dr. Chaudhry did not get the physical record to finish the dictation, and Schreur read the

8 information orally while dictating.

9 Perez came off of bypass at 11:45:47 a.m., meaning Perez was taken off the heart and

10 lung machine, but the operation was not over and the surgeons continued working. (See

11 Perfusion Record, Ex. 102 at 1.) The last entry in the Perfusion Record for the heart and lung

12 machine is at 12:09 p.m., however Schreur remained in the operating room after such time

13 performing work. Dr. Chaudhry was at the dictation table computer before 12:09 p.m. putting in

14 postoperative notes.

15 After Dr. Chaudhry completed the dictation, he went on the anesthesia side of the

16 operating room and saw that the blood pressure was a little high. Dr. Chaudhry told staff to

17 adjust the blood pressure and take off anesthesia, said to stop epinephrine, and told staff to start

18 milrinone to lower the blood pressure.

19 Dr. Chaudhry did not leave the operating room at any time prior to 12:15 p.m. At

20 approximately 12:15 p.m., and perhaps a minute or two later, Dr. Chaudhry left the operating

21 room, leaving his physician assistant Albakova and assistant surgeon Dhillon to complete the

22 surgery, including the closure of Perez’s chest. Dhillon and Albakova left the operating room

23 around 12:35 p.m.

24 After Dr. Chaudhry left the operating room and the hospital, Perez was bleeding an

25 abnormal amount. Dr. Chaudhry was called at 12:45 p.m., and Dr. Chaudhry instructed Bhatt to

26 3

Dr. Chaudhry also stated he had witnessed no direct animosity from Albakova by that time. When asked if Dr.

Chaudhry knew Albakova to be a liar during their seven (7) year working relationship, Dr. Chaudhry stated they

27 broke up in May of 2013, when she was cheating on Dr. Chaudhry, so she had been caught lying at that point.

However, Dr. Chaudhry trusted her, and still trusts her work as he believes she had impeccable work ethics and

28 impeccable hands in the operating room.

16

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1 continue giving blood products. Perez developed arrhythmias (abnormal heart beats) which

2 progressed to ventricular fibrillation. The remaining staff began CPR with intermittent

3 defibrillation but were unsuccessful at getting a normal rhythm back. At around 12:58 p.m., Dr.

4 Chaudhry was called to return to the operating room because the patient had arrested. CPR was

5 continued until around 1:12 p.m. when Albakova returned. Albakova then opened Perez’s chest

6 and found the heart had been perforated. Albakova tried to cannulate to allow Perez to go back

7 on cardiopulmonary bypass, but Albakova struggled and frantically spoke to Dr. Chaudhry over

8 the phone to get instructions. The anesthesiologist Bhatt then put on gloves to assist with

9 cannulation and at 1:24 p.m. Schreur commenced cardiopulmonary bypass on a limited basis. At

10 around 1:29 p.m., Dr. Chaudhry returned to the operating room with Dr. Robert Stewart

11 (“Stewart”). Stewart and Dr. Chaudhry adjusted the cannulas and Perez was returned onto a full

12 cardiopulmonary bypass.

13 It was determined that Perez’s ventricle had been lacerated by the chest compressions

14 which had caused the recently operated sternum to fracture and slice into the heart chamber.

15 This resulted in a long and difficult further operation and Perez is believed to have suffered

16 hypoxic brain injury as a result of a period of poor perfusion.

17 The Perfusion Record contains notes entered by Schreur on April 2, 2012, that read in

18 part:

19 Patient codes approximately 12:55 [p.m]. Dr. Chaudhry called at 12:58 [p.m.].

CPR is started with intermittent defibrillation. Albakova and Bhatt attempt

20 cannulation around 1:20 [p.m.]. Patient started on partial CPB around 1:25

[p.m.]. Chaudhry enters at 1:29 [p.m.] with Dr. Stewart. They take over and

21 patient is put on full CPB at 1:38 [p.m.]. Pump was primed with 2L Normosol

and 60,000 units of heparin. The high heparin dose was due to the patient having

22 no circulation, thus no way for anesthesia to give loading dose.

23 (Ex. 102 at 4.)

24 Schreur also entered notes into his cellular phone throughout the day of the Perez

25 surgery. These notes state in part that: Dr. Chaudhry leaves at 12:03 p.m.; at 12:35 p.m.

26 Albakova and Dhillon finish the closing of the chest and leave; Perez is bleeding; Dr. Chaudhry

27 is called at 12:45 p.m. and tells Bhatt to give blood products; at 12:58 p.m. Dr. Chaudhry is

28 called to return; at 1:12 p.m. Albakova opens the chest, is “hysterical, but tries to take

17

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1 instructions from [Dr. C]haudhry over the phone”; and at 1:15 p.m. Bhatt put on gloves and tried

2 to help cannulate. (Ex. 512 at 1.) Schreur’s phone notes also indicate that an x-ray was taken

3 sometime between 12:45 p.m. and 12:55 p.m., and that at 5:45 p.m., Dr. Chaudhry “sa[id] to get

4 patient to cvu quickly, there is nothing else he can do. [6:15 p.m.] [C]huadhry called for

5 excessive bleeding, he calls [S]tewart to come in. [7:00 p.m.] [S]tewart reopens, and at [7:20

6 p.m.] finds surgical bleed and takes care of it.” (Ex. 512 at 1.)

7 Schreur wrote a written account of the events surrounding the Perez surgery, at the

8 request of James Robillard (“Robillard”), who was Schreur’s boss. (Ex. 511.) Schreur

9 understood Robillard requested the written account because Robillard intended to file a

10 complaint to CDPH or another agency. The written account was completed within two (2) days

11 of the surgery. Schreur’s written account states in relevant part:

12 Operation goes well and patient comes off CPB at [11:45 a.m.]. At [12:03 p.m.]

Chaudhry finishes his op. note and leaves the room while patient’s chest is still

13 open, as he frequently does, leaving his PA [Albakova] and assistant surgeon to

close. Patient is closed at [12:35 p.m.] and the PA and asst. surgeon leave the

14 room. The patient is still bleeding an abnormal amount and is never moved from

the op. table. Chaudhry is called at [12:45 p.m.], and he gives orders to anesthesia

15 to continue giving blood products. The patient continues to bleed and by 12:55

p.m.] has put out 1500 ml of blood into the chest tubes. Patient goes into

16 hypovolemic shock and then v-fib at [12:55 p.m.].

17 Cardiac team begins CPR with intermittent defibrillation but is unsuccessful at

getting a normal rhythm back. At [12:58 p.m.] Chaudhry is called to rush back to

18 the OR because the patient has arrested and we need him immediately. Team

continues CPR until [1:12 p.m.] when the PA arrives, opens the chest and finds

19 the heart has perforated. She tries to cannulate to go on CPB, but struggles

greatly as she has never done this on her own before. She talks with Chaudhry on

20 the phone to get instructions. The anesthesiologist puts on gloves to assist with

cannulation and at [1:24 p.m.] the perfusionist commences CPB on a very limited

21 basis using pump suckers for venous return. At this point the patient has had a

MAP of around 20 mmHg for close to 30 minutes. CPR was only minimally

22 effective because the heart was perforated and unable to properly eject volume

and create a pulse pressure.

23

At [1:29 p.m.] Chaudhry finally arrives in the OR, 31 minutes after being called

24 for a stat return. With him is another cardiac surgeon, Dr. Robert Stewart. They

adjust the cannulas and at [1:39 p.m.] the perfusionist brings the patient up to full

25 flow CPB. At [1:55 Chaudhry asks an aid to get his car keys and repark his car

from the patient drop off area so it doesn’t get towed (he obviously had left the

26 hospital facility while his patient was still on the OR table and had to drive back

after being called). The patient is stabilized on CPB but is unable to come off. At

27 [3:53 p.m.] the patient is placed on ECMO support. At [5:45 p.m.] Chaudhry

again leaves the room despite the patient bleeding profusely into the chest tubes.

28 At [7:00 p.m.] Dr. Stewart arrives back to assess the patient. He opens the chest

18

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1 and finds a surgical bleed, which he then repairs. The patient stabilizes

somewhat, but continues to ooze blood into the chest tube. At [9:40 p.m.] the

2 patient is brought to the CVU on ECMO and IABP support.

3 It is now [April 5, 2012] and the patient remains on ECMO and IABP. His

neurological status is not known, but he has not woken up yet. It would appear

4 that there is significant, if not total, brain death. However, this can’t be fully

determined at this time.

5

I believe this case needs to be thoroughly investigated. There is gross negligence

6 in this case where it took the primary cardiac surgeon over 30 minutes to return to

the OR after being called to treat the cardiac arrest of his patient. He had left the

7 building while his patient was still on the table, and likely while the patient’s

chest was still open and his condition was critical. These situations are very

8 common where a patient does not do well post-CPB and needs to go back on in

order to reperfuse and recover. In this specific case, had the surgeon been there to

9 perform the procedure in a timely manner, I believe the patient’s chances for

recovery would be high. But because it took so long, partial brain damage is all

10 but a certainty. Ultimately, death is very likely in the next few days for this

patient. It is unacceptable that the patient was subjected to this kind of gross

11 negligence.

12 I must emphasize that my identity remain anonymous in regards to this case. This

surgeon has so much power at this institution that if it was found I had made a

13 complaint against him he would certainly come after me and have me fired. It is

for this reason that he has avoided complaints on multiple ethics issues in the past

14 involving sexual misconduct, operating while intoxicated, and substandard care . .

.

15

(Ex. 511 at 1-2.)

16

In writing the chest was “still open,” Schreur meant that the sternal wires had not been

17

closed putting the sternum back together. In writing “as he frequently does,” Schreur meant that

18

it was Dr. Chaudhry’s custom to allow his assistant surgeon and physician assistant to close the

19

chest in such manner, which would entail Dr. Chaudhry leaving the operating room.4

20

B. The Investigation of the Perez Surgery by CDPH

21

Here, the Court will summarize the role of the relevant agencies and employees that

22

4

23 Dr. Chaudhry and Schreur were the only witnesses that testified during this trial that were physically present in the

operating room for the Perez surgery. Dr. Chaudhry testified that he disagreed with Schreur’s account. Dr.

Chaudhry also testified he learned Perez “coded” at 12:59 p.m., and Dr. Chaudhry was back at the hospital at 1:18

24

p.m. Dr. Chaudhry proffered the medical staff bylaws, his call coverage contract, and his privilege cards, all state he

has to answer page calls in fifteen (15) minutes and be in hospital in thirty (30) minutes, and that he was at hospital

25 within nineteen (19) minutes. Dr. Chaudhry proffered that the “swipe card” records reviewed while testifying meant

Dr. Chaudhry was in the hallway at 1:18 p.m. and thus he must have been on the second floor on the way to the

26 operating room, and running through to the operating suite. The Court addresses the credibility of this testimony in

conjunction with all of the admitted evidence and testimony, including the designated testimony of witnesses that

27 did not testify in person at this trial nor were specifically deposed in this action, but were present in the operating

room, in the legal analysis section below.

28

19

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1 conducted the investigatory and regulatory functions involved in this action, as was presented to

2 the Court in the testimony of Defendants, other witnesses, and documentary evidence. In

3 Section IV(A), infra, the Court provides the relevant statutes and regulations underlying the

4 agencies and survey investigation process.

5 The CDPH oversees licensed health care facilities, and does not directly oversee

6 physicians such as Dr. Chaudhry. Rather, the Medical Board of California oversees physicians.

7 Complaints made to CDPH regarding covered health care facilities are processed by

8 CDPH through the Aspen Complaint Tracking System (“ACTS”), and entered into an ACTS

9 complaint/incident investigation report. (See Ex. 502.) The form is a California form approved

10 by the federal government. CDPH staff fills in information and CDPH assigns a supervisor to

11 the complaint. After staff has verified sufficient information, the evaluator gives the information

12 to the supervisor to make a decision whether it is referred to the Centers for Medicare and

13 Medicaid Services (“CMS”) or stays with the State.5 CDPH employees conduct the initial

14 survey investigation, then the report goes to CMS. CMS then determines what should be done

15 on the federal side, and then directs the state agency how to proceed.

16 CDPH and CMS investigation surveys are completed by assigned surveyors. Surveyors

17 collect sources of evidence consisting of observations, interviews, or record reviews, analyze that

18 data, put the deficient practices together if applicable, and submit the information to a supervisor

19 or manager for review. The written report outlining the deficient practice is called a Statement

20 of Deficiencies (“SOD”), or referred to as a “2567.” Both CDPH and CMS may issue a SOD. A

21 SOD is submitted to the hospital to address systemic problems of the hospital or facility,

22 including compliance with the Conditions of Participation for CMS.

23 A Plan of Correction (“POC”) is created after the investigated facility obtains the SOD,

24 whether state or federal, and the hospital or other facility enters their corrective plan of action

25 5

CMS is a component of the Department of Health and Human Services, administers the Medicare program.” Fox

Ins. Co. v. Centers for Medicare & Medicaid Servs., 715 F.3d 1211, 1214–15 (9th Cir. 2013). The term “State” is

26 used generally herein to refer to the investigations conducted or reports issued by CDPH as an agency of the state of

California, or its employees, as opposed to the federal CMS investigations or reports. In Section IV(A), the Court

27 provides the statutes and regulations governing the relationship between CMS and CDPH and the parallel processes

for the investigations they conduct, and reports they issue.

28

20

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1 into a blank column on the SOD document to address the stated deficiencies, for the purpose of

2 ensuring the facility does not repeat the deficient practices. The left-hand side of the document

3 contains the SOD, and the right-hand side contains the POC. CDPH uses the format for a POC

4 as provided by CMS. Following completion of a SOD/POC, the hospital or facility is required to

5 post the SOD/POC, generally by either putting the report in a survey results binder, or on a

6 bulletin board, where the public can ask to see or have access.

7 A SOD does not target a particular individual practitioner or doctor, though a facility may

8 discipline individual practitioners afterward or in relation to the POC. CDPH does not have the

9 direct authority to deny or limit Medicare reimbursement to the facility, as that falls under the

10 authority of CMS. For a federal survey, CDPH submits the survey report to CMS for final

11 review, not directly to the hospital.

12 At all relevant times, Defendant Lopez, Defendant Campbell, formerly named Defendant

13 Kappmeyer, and nonparties Joan Spence (“Spence”) and Adams Yussif (“Yussif”), were

14 employees of the CDPH and acting under color of state law. As CDPH employees, they were

15 not federal employees during the relevant investigation, but acted as agents of the federal

16 government in applying the rules and regulations that govern health care facilities for which

17 CDPH has jurisdiction over.

18 In 2012 and part of 2013, Lopez was employed by CDPH as a Health Facilities Evaluator

19 Supervisor, and assigned to the Fresno District Office. From October 31, 2013 to August 2,

20 2016, he held the position of Staff Services Manager I. As of the time of his testimony in this

21 trial, he was a Health Facilities Evaluator Manager II.

22 At all relevant times, Defendant Campbell was employed by the CDPH as a Health

23 Facilities Evaluator Manager I. Prior to her promotion to that position that occurred in 2012

24 around the time of the Perez investigation, she was a Health Facilities Evaluator Supervisor.

25 Since November 30, 2014, Defendant Campbell has been retired. Spence was Campbell’s

26 supervisor at the time of the investigation.

27 At all relevant times, Yussif was employed by the CDPH as a Health Facilities Evaluator

28 Nurse, with surveyor identification number 27126. Lopez was Yussif’s supervisor during the

21

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1 State investigation and relevant time when the State reports were issued. In 2012, Lopez and

2 Campbell were peers, as they were both supervisors. In 2012, Kappmeyer was not on Lopez’s

3 team, and did not report to him. By 2013, Lopez reported to Campbell.

4 On April 11, 2012, CDPH received an anonymous call alleging that Dr. Chaudhry left the

5 operating room while Perez’s chest was still open, then left the hospital before the surgery was

6 completed leaving his physician assistant Albakova to take over the surgery, and that Perez went

7 into cardiac arrest. The complaint was processed by CDPH and entered into an ACTS

8 complaint/incident investigation report. (See Ex. 502.) The ACTS complaint triggered a State

9 investigation. The intake spot for “SA Contact” stands for “State Agency Contact.” Campbell

10 was the State Agency Contact listed on the initial state intake form because Campbell is the

11 supervisor generally assigned to oversee CRMC. However, Lopez was the supervisor that

12 assigned CDPH surveyor Yussif to this initial State-complaint investigation after Lopez was

13 informed by Spence, the district manager of CDPH at the time, when the anonymous complaint

14 for the Perez surgery was put into the system. (See Exs. 500 at 9, 502.)6

15 On or about April 16-19, 2012, CDPH began the initial State investigation of the

16 anonymous complaint. Given the Perez surgery allegations were considered a serious priority,

17 there needed to be an on-site visit begun within 24 to 48 hours, and Yussif commenced such on-

18 site investigation. During his investigation, Yussif did not interview Drs. Chaudhry, Dhillon, or

19 Bhatt, nor the physician assistant Albakova. Dr. Chaudhry was aware someone from CDPH was

20 at CRMC investigating the Perez surgery. Dr. Chaudhry found out about the investigation when

21 Dr. Jeffrey Thomas (“Thomas”) told him the “State” was there. Dr. Chaudhry provided a written

22 statement for Thomas, and turned it into the medical staff office at CRMC.

23 Yussif, the state surveyor of record collected evidence and evaluated the evidence for the

24 initial State investigation. Lopez’s role at CDPH included reviewing SODs under the agency’s

25 6

The Court notes that Plaintiffs’ counsel pressed Campbell that it was in fact her that assigned the complaint to

Yussif. In deposition testimony from the Perez Malpractice Case designated by Defendants, the Court notes that

26 Yussif in fact testified that Campbell called him and asked Yussif to investigate CRMC. (Dep. Adams Yussif

November 9, 2015 (“Yussif Dep.”), 25:22-26:6.) However, an email dated April 11, 2012, reflects that Spence

27 wrote to Lopez “can you assign this please in the absence of Shirley [Campbell].” (Ex. 500 at 9.) Campbell was

cc’ed on the email. (Id.) Campbell conceded in testimony it is possible she could have assigned to Yussif. Whether

28 Campbell or Lopez assigned the initial investigation is not determinative of any ultimate conclusions by the Court.

22

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1 principles of investigation, looking at supportive evidence, and ensuring the written product

2 followed the principles of documentation. Lopez and Campbell were not directly coordinating

3 the State investigation while it was ongoing at CRMC, however, as supervisor, Lopez was aware

4 of the allegations and Yussif’s preliminary findings from the initial State investigation, and

5 generally oversaw the investigation at that point. It is an undisputed fact that at all relevant

6 times, Lopez verified and supervised the two investigations of CRMC as related to the heart

7 surgery operation of Perez by Dr. Chaudhry, and made the final decision as to the accuracy of

8 the State Report published in 2013.7 (UF 4.)

9 While Yussif was supervised by Lopez, given CRMC was assigned to Campbell, Lopez

10 would have reviewed the information and communicated the preliminary findings of the State

11 investigation to Campbell to determine the next step, and the next step here was to inform CMS

12 that there were problems that may need to be investigated on the federal side. CDPH is expected

13 to report to CMS any serious problems with the hospital provider, and here, the complaint and

14 preliminary findings obligated CDPH’s office to inform CMS of the results of the April 2012

15 investigation into CRMC, which then authorized the federal complaint validation survey that

16 began on July 13, 2012. Thus, based on the results of Yussif’s initial investigation, the CMS

17 investigation was triggered.

18 C. The CMS Investigation

19 Campbell and Kappmeyer were co-surveyors assigned to the federal-complaint validation

20 investigation which took place from July 13, 2012 to July 17, 2012 (the “CMS Investigation”).

21 Spence was a supervisor over the CMS Investigation. Dr. Everette Davis (“Davis”), also

22 provided consultant work on the federal investigation. During this time, as CRMC was not

23 7

When the proposed POC was later returned by CRMC, Lopez’s role was to review the right hand side of the POC,

looking at the content and the action that was needed in order to address the deficient practice. Lopez would read

24

the left side for content (SOD), and for supportive evidence that relates to the deficient practice, as the right side of

the form (POC), must address actions in order to correct deficiencies. Lopez does not generally, and did not in this

25 case, retrieve or review all of the investigative notes or supportive data at that time, but rather, reviewed the content

of the deficient practice, the sources of evidence, and how it relates to the deficient practice in order to guide the

26 hospital to direct their corrective actions. Before issuance, the report would then go to next level of review, because

of the involvement of an administrative penalty. Specifically here, the report would have gone to the manager of the

27 office, then to Davis as the medical consultant, then to the office of legal services for CDPH, and then to the Branch

Chief prior to issuing the combined SOD and POC form. Lopez was not involved during this further review.

28

23

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1 assigned to Lopez as a supervisor, Lopez was not involved in this part of the process.

2 Campbell initially received the complaint typed on an ACTS form used to initiate a CMS

3 investigation, and then entered the information into the ACTS system. (See Ex. 501 at 1; Ex.

4 103 at 1.) Under “Intake,” the form stated:

5 Patient was having open heart surgery and his surgeon, Dr. Pervaiz Chaudhry, left

the operating room while the chest was still open and then left the hospital before

6 the surgery was done leaving his PA to take over their surgery while he went to

lunch. Patient was bleeding profusely. The patient arrested in the operating room

7 and the surgeon was not even in the hospital to attend to the patient. It took Dr.

Chaudhry 30 minutes to get back into the operating room and by then the patient

8 had very little blood pressure for approx 30 minutes. The patient had to be put on

life support and is in a coma. ¶ The patient went into hypovioemic shock and

9 then cardiac arrest. The patient was resuscitated and stabilized with the support of

ECMO and a balloon pump. This patient is now in a state of near total brain

10 death as a result of being in arrest for such a long duration.

11 (Exs. 103 at 1, 501 at 1.)

12 The CMS Investigation covered CRMC’s compliance with the federal Conditions of

13 Participation under the Code of Federal Regulations. Once the CMS survey begins, it follows

14 the federal process of collecting data and determining whether or not there is a deficient practice,

15 and CDPH has ten (10) business days in order to submit a SOD to CMS for review. While the

16 investigation’s focus was the Perez surgery incident, it was broader in that it looked at CRMC’s

17 policies and procedures, the governing body, hospital staff, and reviewed the hospital system as a

18 whole to ensure proper functioning under the Conditions of Participation.

19 There were five CMS categories of deficiencies that were investigated by Campbell and

20 Kappmeyer: (1) Medical Staff; (2) Medical Staff Bylaws; (3) Surgical Services; (4) Organization

21 of Surgical Services; and (5) Operating Room Policies. (Ex. 501 at 1.) Campbell and

22 Kappmeyer essentially shared the category of Surgical Services because Campbell was looking

23 at the overall facility, and within that category is the Professional Affairs Committee, the

24 Surgical Committee, and the Medical Executive Committee. Kappmeyer covered Operating

25 Room Policies, and Campbell covered Medical Staff and Medical Staff Bylaws.

26 During the CMS investigation Campbell and Kappmeyer shared notes and exchanged

27 information. Physical interviews were conducted at CRMC for four (4) or five (5) days. Dr.

28 Chaudhry was the only staff person identified by name in the complaint. Campbell and

24

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1 Kappmeyer determined who was in the operating room, and then proceeded to interview people

2 who facility staff identified, and as relevant to the categories of investigation. The investigation

3 included review of the rules and regulations, bylaws, and the staff who had oversight over the

4 relevant areas. Interviewees are somewhat predetermined given the categories, and the facility

5 itself has its own list of key people within these categories. To obtain a greater perspective on

6 the hospital’s functioning, interviews of doctors and staff not involved in the Perez surgery were

7 utilized.

8 During the relevant time period, Laura McComb (“McComb”) was an Associate

9 Administrator of Risk Management, Patient Safety and Regulatory Issues, for CRMC.

10 McComb’s work included creating POCs in response to SODs, and specifically prepared POCs

11 in response to the State and CMS SODs for the Perez matter. McComb has known Campbell

12 approximately thirty (30) years or more, and had worked together on CMS surveys before 2012.

13 McComb did not witness any animosity by Campbell toward the hospital or the staff involved,

14 and never experienced any personal bias by Campbell before July 2012 against anyone Campbell

15 was conducting surveys concerning. McComb is identified as “Administrative Staff 2” in the

16 Federal CMS Report. Thomas Utecht (“Utecht”), Chief of Quality Control of CRMC, was

17 McComb’s immediate supervisor during the relevant time.

18 While McComb’s staff initially sat in on the interviews conducted by Yussif in April of

19 2012, when the CMS investigation began in July of 2012, McComb was requested to exclude her

20 staff from being present during interviews. McComb raised a concern to CRMC’s legal

21 department of the risk of misquotations, however the legal department agreed to not have staff

22 present. This was not the first time this type of request was made during survey investigations,

23 and surveyors, including Campbell and Kappmeyer, had made the request to McComb that

24 investigators be the only people in the room with interviewees in other matters prior to the Perez

25 investigation.

26 During the CMS investigation, Campbell conducted an interview of Dr. Chaudhry. At

27 the end of the interview with Dr. Chaudhry, Campbell informed him that he could return to her

28 and provide additional information. Campbell did not know of Dr. Chaudhry before the

25

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1 investigation and testified she had no animosity or bias toward him.

2 Campbell and Kappmeyer did not interview Dhillon, Bhatt, nor Albakova. Campbell was

3 informed that Albakova was in Russia and unavailable for an interview. Campbell did not try to

4 email or call Albakova in Russia.8

5 Campbell interviewed a Dr. Synn, a member of the board of trustees of the facility, to

6 obtain general information on the governing body. Campbell interviewed Thomas, the president

7 of the medical department, to obtain information on conditions and systemic issues. Campbell

8 conducted a phone interview with Robillard.

9 Yussif interviewed Schreur during the April 2012 investigation, and Kappmeyer

10 interviewed Schreur in July of 2012 during the CMS Investigation. Campbell did not interview

11 Schreur.

12 Campbell interviewed Allen, and Campbell’s recorded notes reflect that Allen told

13 Campbell that Dr. Chaudhry was “still there to end of skin closing.” (Ex. 104 at 16; 5/4 149.)9

14 Kappmeyer interviewed a Julianne Ely, a manager for the surgery department, regarding

15 policies and procedures, and issues regarding Dr. Chaudhry. Kappmeyer interviewed a Julie

16 Carson, a manager of cardiovascular surgery, for the purpose of ascertaining requirements for

17 cardiovascular versus general surgery, concerning the different policies, procedures, rules,

18 regulations. Kappmeyer interviewed Griselda Owens, to obtain information on Conditions of

19 Participation. Kappmeyer interviewed Drew Walker, for general information regarding

20 construction and climate control in the OR. Kappmeyer interviewed Stan Zulewski, a facilities

21

8

22 In designated deposition testimony from the Perez Malpractice Case, Albakova stated she never told anyone at

CDPH that she was out of the country, though she might have told “them,” referring to CRMC, that she was leaving

23 the country. (Dep. Bella Albakova Vol. I, April 8, 2015 (“Albakova Dep. Vol I”), at 242:14-243:23.) However,

Albakova never actually left the country, but was rather on “vacation” at home in Fresno, and is not aware of how

CDPH concluded she was out of the country. (Id.) Albakova never received any communication from CDPH and

24

stated she was available until she left in the beginning of May 2012 for vacation. (Id.)

25 9

Further, designated testimony of Allen from the Perez Malpractice Case reflects she testified that Dr. Chaudhry

came over to the operating table during the skin closing after dictating notes. (Dep. Martha Allen Vol. I Dec. 9,

26 2014 (“Allen Dep. Vol I”), at 581:2-582:23.) However, Yussif’s notes of the interview with Allen dated April 18,

2012, reflect Allen told Yussif that Dr. Chaudhry “left the room and Dr. Dhillon and Bella [Albakova] were closing

27 up.” (See Ex. 507 at 7.) Campbell initially testified that she did not interview Allen, stating Kappmeyer interviewed

Allen, and Campbell stated she vaguely remembered Allen’s timeline did not match with other reports. However,

28 Campbell’s recollection was then refreshed by her notes that indicated she did interview Allen.

26

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1 manager, to obtain information regarding climate control or other infection control issues.

2 Campbell interviewed Utecht in July of 2012, to evaluate whether the Perez incident was

3 a systemic problem or isolated individual problem. Campbell utilized McComb as a kind of

4 point-person to help coordinate documents and interviews. Campbell interviewed McComb for

5 input regarding other staff and to obtain documents pertaining to policies and procedures.

6 Campbell reviewed the peer review file as to both Dr. Chaudhry and Albakova. During

7 the CMS investigation, Campbell did not review any “swipe cards” which recorded when

8 doctors, nurses and necessary personnel entered private rooms like the operating room.

9 In resolving conflicts in testimony and evidence, when conducting a CMS investigation,

10 Campbell is trained not to interrogate, but to take the information as given, and then proceed to

11 making a judgment call based on all of the information, drawing a conclusion, and utilizing

12 interviews, policies, procedures, rules, regulations, bylaws, information from committees, and

13 essentially everything that is provided or obtained.

14 The Court will excerpt some of the relevant notations in the ACTS

15 Complaint/Investigation Report (Ex. 103), reflecting the investigation and interviews conducted

16 by Campbell and Kappmeyer, that were incorporated in part or whole into the CMS SOD. The

17 report states in part:

18 Based on staff interview, clinical record and administrative document review, the

hospital failed to ensure quality medical care was provided to patients and failed

19 to ensure Medical Staff Bylaws and regulations were enforced when

Cardiovascular Surgeon 1 (CV 1) left an open heart surgery prior to the closure of

20 the chest. CV 1 instructed a non-surgeon practitioner (Physician Assistant 1) to

close the chest and did not appoint a qualified medical professional in his absence.

21 The dictated operative report for Patient 1’s surgery did not reflect the

participation of the non-surgeon. The operative report for Patient 1 did not reflect

22 the critical condition of the patient after surgery . . .

. . . The cumulative effect of these systemic problems resulted in the hospital’s

23 inability to ensure the provision of quality health care in a safe environment . . .

24 . . . On 7/13/12 at 10:35 a.m., during an interview, CV 1 stated he directed PA

(Physician Assistant) 1 to finish the case which meant she was to perform the

25 remainder of the surgery – closure of the chest with wires (reference to the

staples) and the rest of the closing. CV 1 stated he had checked all tubes and all

26 was routine. CV 1 stated he allowed PA 1 to practice above her privilege card as

“she was preparing for an Advanced Quality Practice Exam and for that, she

27 needed so many cases with opening and closing the chest, and to cannulate the

insertion of a cannula or tube into a hollow body organ the heart …’ CV 1 said he

28 was ‘… always there when she did this, until this time.’ CV 1 stated he left the

27

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1 surgery and went up to the unit to complete orders for the patient at about 11:30

a.m., and then left the hospital premises at about 12:40 p.m. PA 1 was out of the

2 country and was unavailable for an interview.

3 On 7/13/12 at 11:40 a.m., during an interview, CV1 acknowledged the entry that

Patient 1 was transferred to the surgical intensive care unit in stable condition was

4 an error. HE stated this was his routine entry but it did not happen ( meaning the

patient was not transferred to the SICU in stable condition but was transferred to

5 the cardiovascular intensive care unit in critical condition) in this case.

During an interview on 7/16/12 at 11:30 a.m., MD 2 and Administrative (Admin)

6 Staff 2, both stated CV 1 left the operating room prior to closure/stapling of the

bones back together. MD 2 and Admin Staff 2 stated PA 1 had stapled the bones

7 in this case without the Cardiovascular Surgeon being present. MD 2 and Admin

Staff stated that CV 1 violated the hospital’s Rules and Regulations under the

8 Bylaws which does not permit the primary surgeon to leave the operating room

prior to the patient being established as stable . . .

9

Based on observation, staff interview, and clinical record and administrative

10 document review, the hospital failed to ensure surgical services were provided in

accordance with acceptable standards of practice when:

11

1. Cardiovascular Surgeon 1 (CV 1) left the operating room and the hospital

12 premises prior to the stapling of the ribs back to the sternum (bone to bone

closure) and prior to the closure of the remainder of the surgical site (fascia –

13 tissue that holds soft organs in place, muscles and skin) during an open heart

surgery for Patient 1 in violation of the hospital’s “Rules and Regulations” . . .

14

3. The CV 1 did not accurately dictate the operative report to reflect non-surgeon

15 participation in the closing of the chest surgical site for Patient 1 and did not

accurately reflect the condition of Patient 1 after the surgical procedure . . .

16

17 (Ex. 103 at 2-4.)

18 D. The Issued State and CMS Reports

19 As a result of the investigations, review process, and completion of the POC portion by

20 CRMC, CDPH prepared a Statement of Deficiencies and Plan of Correction, dated February 14,

21 2013 (“State 2567” or “State Report”), and a Statement of Deficiencies and Plan of Correction,

22 dated August 23, 2012 (“CMS 2567” or “Federal Report” or “CMS Report”).

23 The State 2567 did not contain Dr. Chaudhry’s name, and referred to him as

24 “Cardiovascular Surgeon 1 (CVS 1).” The State 2567 referred to Perez as “Patient 1,” Albakova

25 as “PA 1,” and Dhillon as “MD 1.” The top of the State 2567 contains the heading “California

26 Health and Human Services Agency [-] Department of Public Health.” (Ex. 113 at 1

27 (capitalization altered).) The State 2567 notes that: “Representing the Department of Public

28 Health: Surveyor ID # 27126, HFEN.” (Ex. 113 at 1.) As noted above, Yussif’s surveyor

28

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1 identification number is 27126.

2 The State 2567 Statement of Deficiencies (“State Report” or “State 2567”) found, among

3 other things, that “CVS 1 left the OR at 11:45 a.m.,” that “PA 1 and MD 1 sutured the chest

4 closed with metallic wire at approximately 12:00 p.m. and then left the OR,” that “CVS 1 left the

5 open-heart surgery on Patient 1 prior to closing of the chest and prior to stabilization in violation

6 of hospital medical staff bylaws,” and “CVS 1 left in-charge an individual not qualified to be left

7 in charge (PA 1).” (Ex. 113 at 3, 7.)

8 The CMS 2567 did not contain Dr. Chaudhry’s name, and referred to him as

9 “Cardiovascular Surgeon 1 (CV 1).” The CMS 2567 referred to Perez as “Patient 1,” Albakova

10 as “Physician Assistant 1,” Utecht as “MD 2,” and McComb as “Administrative (Admin) Staff

11 2.” The top of the CMS 2567 contains the heading “Department of Health and Human Services

12 [-] Centers for Medicare & Medicaid Services.” (Ex. 505 at 1 (capitalization altered).) The

13 CMS 2567 noted the document “reflect[ed] the findings of [CDPH] – Licensing and Certification

14 during a Complaint Validation Survey conducted on 7/17/12.” (Ex. 505 at 1.) The CMS 2567

15 also noted: “Representing the [CDPH] – Licensing and Certification: Shirley Campbell RN

16 HFEMI, and Deidre Kappmeyer RN HFES.” (Id.)

17 The CMS 2567 found that the following “Conditions of Participation were not met: 42

18 CFR 482.22 Medical Staff and 482.51 Surgical Services.” Regarding Medical Staff, the CMS

19 2567 stated “the hospital failed to ensure quality medical care was provided to patients and failed

20 to ensure Medical Staff Bylaws and regulations were enforced when Cardiovascular Surgeon

21 (CV 1) left an open-heart surgery prior to the closure of the chest [and] instructed a non-surgeon

22 practitioner (Physician Assistant 1) to close the chest and did not appoint a qualified medical

23 professional in his absence.” (Ex. 505 at 1.) Regarding Surgical Services, the CMS 2567 stated

24 “the hospital failed to ensure surgical services were provided in accordance with acceptable

25 standards of practice when . . . (CV 1) left the operating room and the hospital premises prior to

26 the stapling of the ribs back to the sternum (bone to bone closure) and prior to the closure of the

27 remainder of the surgical site (fascia – tissue that holds soft organs in place, muscles and skin)

28 during an open heart surgery for Patient 1 in violation of the hospital’s ‘Rules and Regulations.’

29

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1 (Ex. 505 at 6-7.)

2 The CMS 2567 found the hospital did not meet the Conditions of Participation for

3 deficiencies including but not limited to: (1) “the hospital failed to ensure quality medical care

4 was provided to patients and failed to ensure Medical Staff Bylaws and regulations were

5 enforced when Cardiovascular Surgeon 1 (CV 1) left an open-heart surgery prior to the closure

6 of the chest,” (2) “CV 1 instructed a non-surgeon practitioner (Physician Assistant 1) to close the

7 chest and did not appoint a qualified medical professional in his absence,” (3) “[t]he dictated

8 operative report for Patient 1’s surgery did not reflect the participation of the non-surgeon,” (4)

9 [t]he operative report for Patient 1 did not reflect the critical condition of the patient after

10 surgery,” and (5) “the hospital failed to ensure surgical services were provided in accordance

11 with acceptable standards of practice.” (Ex. 505)

12 The CMS 2567 also noted that during an interview, “CV 1 stated he left the surgery and

13 went up to the unit to complete orders for the patient at about 11:30 a.m. and then left the

14 hospital premises at about 12:40 p.m.” (Ex. 505 at 3.) The CMS 2567 also noted during an

15 interview that: “MD 2 and Administrative (Admin) Staff 2, both stated CV 1 left the operating

16 room prior to closure/stapling of the bones back together . . . [and] stated PA 1 had stapled the

17 bones in this case without the Cardiovascular Surgeon being present . . . [and] CV1 violated the

18 hospital’s Rules and Regulations under the Bylaws which does not permit the primary surgeon to

19 leave the operating room prior to the patient being established as stable.” (Ex. 505 at 3-4.)

20 Campbell reached the conclusion that Dr. Chaudhry instructed Albakova to close Perez’s

21 chest in his absence, and that the action violated CRMC’s policies and procedures. Campbell’s

22 conclusion was based on the totality of the interviews, including Schreur, Allen, Breaux, 10 Dr.

23 Chaudhry, Utecht, McComb, and Robillard, in conjunction with a review of the hospital bylaws

24

10

Specifically, Campbell relied in part on Kappmeyer’s notes of interview with Breaux, although this interview is

25 not expressly reflected in the CMS Report. Kappmeyer’s notes of her July 13, 2012 interview with Breaux reflect

that Breaux stated the operation went well; “Dr. Chaudhry left. Both Dr. Dhillon and Bella performed closure.

26 (They start @ separate ends) Dr. Dhillon is a general surgeon. [Dr. Chaudhry [d]id not sit at desk to do orders . . .

or operative report. This was his practice. He rarely stayed in OR to orders/operative report.” (Ex. 509 at 6.)

27 Yussif’s notes reflect Breaux informed him that Dr. Chaudhry’s “usual is to leave the PA and the [assistant] surgeon

to close the chest,” and “[w]hen [Dr. Chaudhry] left the chest was not closed.” (Ex. 507 at 2.)

28

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1 and procedures. Campbell based the finding that Albakova was not qualified to close the chest

2 on the peer review file of Albakova, the bylaws, and by looking at what Albakova was granted

3 privileges for, as such privileges were not granted on Albakova’s privilege card.

4 Admitted into evidence is a CDPH document entitled “7/12/12 CRMC list of information

5 needed,” which describes what documents would have been requested from the facility for

6 CDPH, and to have available to Campbell and her team to review. (Ex. 105.) The list

7 specifically references: “Privileges for physician assistants specific to the cardiovascular surgical

8 program.” (Ex. 105.) Through this request, Campbell received Albakova’s privilege card and

9 her peer review file. Campbell reviewed the privilege card of Albakova but did not take it from

10 facility as they do not take confidential documents. As to the question of whether a

11 cardiovascular surgeon may delegate a duty to a general surgeon in the operating room,

12 Campbell’s investigation found that the designee had to be a qualified professional as expressly

13 allowed on their privilege card, as indicated by the peer review information, and CRMC’s rules

14 and regulations.11

15 Campbell found Dr. Chaudhry’s absence caused Perez’s decline due to Dr. Chaudhry’s

16 designation to Albakova in closing the chest; there were issues from something being torn or cut

17 during the reattachment of the sternum; and Albakova did not have the privilege on her card to

18 be able to close. Based on CRMC’s bylaws and polices, Campbell concluded there were

19 systemic failures that caused the patient to have cardiac arrest, any one of such failures could

20 have caused the cardiac arrest, and concluded there were violations because Albakova didn’t

21 have permission to do the wiring closure.

22 CRMC was subject to a governing document entitled “Community Regional Medical

23 11

Campbell testified she did not specifically remember looking at the general surgeon Dhillon’s privilege card but

does know that Albakova did not have such privilege on her card. Campbell testified that in determining whether

24

Dhillon or Bhatt were qualified or not appropriately credentialed, Campbell believes she spoke with Utecht who told

her such designee had to be a cardiovascular thoracic surgeon, but does not recall for certain. Utecht testified that he

25 never told Campbell that Dhillon or Bhatt were “not qualified as medical doctors in the operating room.” The Court

notes that the line of questioning specifically referenced whether Dhillon and Bhatt “were not qualified as medical

26 doctors,” not whether they had certain privileges or were qualified do the closing of the chest during the surgery, or

whether Albakova could assist in the closing with Dhillon. Campbell further testified she did not recall seeing

27 anything specific, such as a bylaw or rule that identified what a qualified physician was, nor seeing anything specific

that stated Dr. Bhatt nor Dhillon were not qualified.

28

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1 Center Bylaws of the Medical Staff 2011.” (Ex. 521 (capitalization altered).) CRMC’s bylaws

2 provided in relevant part, under the subsection entitled “EXERCISE OF PRIVILEGES,” that: “A

3 practitioner shall be entitled to exercise only those clinical privileges or practice prerogatives

4 specifically granted. Said privileges must be hospital specific and within the scope of the

5 person’s license, certificate, or other legal credential authorizing practice in this State. Clinical

6 privileges shall be exercised pursuant to these Medical Staff Bylaws, Rules and Regulations, and

7 Medical Staff and hospital policy, and subject to the authority of the Department Chairpersons

8 and the Medical Executive Committee.” (Ex. 521 at 48.)

9 Campbell also relied upon the “Rules and Regulations and Policies of the Medical Staff,”

10 dated 2011, which provide in relevant part, within Section D entitled “Coverage Arrangement,”

11 that:

12 Each attending physician shall personally provide or otherwise arrange for

continuous care and coverage for each of his or her patients who present to the

13 hospital for clinical care or who are currently hospital inpatients or who have been

seen on consultative basis. If a physician is unable to provide care for his or her

14 patients, then the physician must provide coverage through another appropriately

credentialed physician. The covering physician must be available and qualified to

15 assume responsibility for the patients during the entirety of the attending

physician’s absence and must be aware of the status and condition of any hospital

16 inpatient which he or she is to cover. Failure to ·arrange appropriate coverage

shall be grounds for corrective action as defined in articles VI and VI I of the

17 Medical Staff Bylaws.

18 (Ex. 520 at 1, 12 (capitalization altered.) Specifically, Campbell used this provision to conclude

19 that Dr. Chaudhry did not appoint a qualified medical professional in his absence.

20 CRMC’s rules and regulations also provide: “The operative report shall include . . . [t]he

21 specific procedures performed and a description of significant surgical tasks that were conducted

22 by practitioners other than the primary LIP (significant surgical procedures include: opening and

23 closing . . . “[c]omplication, if any . . . [and] [p]ostoperative diagnosis.” (Ex. 520 at 30-31.)

24 Campbell concluded the operative report (Ex. 101), did not show Albakova’s involvement nor

25 indicated the critical condition of the patient after the surgery.

26 1. The Time Dr. Chaudhry left the Operating Room and the use of the Term Stapling

of the Bones

27

28 The CMS Report reflects the following statement regarding Campbell’s interview with

32

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1 Dr. Chaudry, referred to as “CV 1”:

2 On 7/13/12 at 10:35 a.m., during an interview, CV 1 stated he directed PA

(Physician Assistant) 1 to finish the case which meant she was to perform the

3 remainder of the surgery – closure of the chest with wires (reference to the

staples) and the rest of the closing). CV 1 stated he had checked all the tubes and

4 all was routine. CV 1 stated he allowed PA 1 to practice above her privilege card

as “she was preparing for an Advanced Quality Practice Exam and for that she

5 needed so many cases with opening and closing the chest, and to cannulate the

heart…” CV 1 said he was “… always there when she did this, until this time.”

6 CV 1 stated he left the surgery and went up to the unit to complete orders for the

patient at about 11:30 a.m., and then left the hospital premises at about 12:40 p.m.

7

8 (Ex. 112 at 17; Ex. 505 at 17.)

9 It is an undisputed fact that Dr. Chaudhry did not leave the operating room prior to 12:15

10 p.m. (UF 11.) While Dr. Chaudhry’s post-operative dictation reported leaving at 12:15 p.m.,

11 Campbell did not specifically see or incorporate that time stamp in her report, as the specific

12 time Dr. Chaudhry left the operating room was not key to Campbell’s findings as to whether the

13 hospital’s bylaws were violated. Rather, Campbell’s focus was on whether Albakova had the

14 privilege under the hospital’s governing policies to close the chest without Dr. Chaudhry present

15 in the operating room. As stated above, Campbell concluded Albakova did not have such

16 privilege based on a review of Albakova’s privilege card, her peer review file, and the hospital’s

17 governing policies. Campbell also considered that during the interview, Dr. Chaudhry told

18 Campbell he was always with Albakova until this time, and the compilation of these facts

19 allowed Campbell to reach the conclusion that there was a violation of the bylaws and applicable

20 rules and regulations, which was not dependent on the time of departure from the operating

21 room.

22 Campbell never specifically asked Kappmeyer which surgeon was referred to in

23 Kappmeyer’s notes of Schreur’s interview where it states “after [patient] stabilized surgeon

24 closes chest.” (Ex. 509 at 8.) Campbell relied on Kappmeyer’s notes of her interview with

25 Schreur, which stated: “Surgery went well. Came off bypass [at] 11:45. After [patient]

26 stabilized, Surgeon closes chest. Dr. Chaudhry left about 20-15 minutes after coming off bypass.

27 Bella routinely put in wires.” (Ex. 509 at 8.) This is despite the fact that this would equate to

28 Dr. Chaudhry leaving the operating room at approximately 12:00 or 12:05. The CMS Report did

33

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1 not include specific reference to Schreur’s interview conducted by Kappmeyer.

2 The State 2567 reported that Schreur (identified as “Staff 1”), stated during the interview

3 with Yussif, that Dr. Chaudhry had left the operating room at “approximately 11:45 a.m., prior to

4 the closure of the chest,” and that Albakova and Dhillon “closed the chest and then left the OR.”

5 (Ex. 113 at 5.) Yussif’s notes from the initial State investigation reflect the following statement

6 indicating Schreur stated the following to Yussif: “We came off bypass at 11:45 a.m. . Then

7 they started to close up the [chest]. Dr. Chaudhry assessed and then stepped away and his PA

8 and Dr. Dhillon K.S. closed up. This is normal. They both hold the wires and pull and then

9 close the [chest]. [Dr. Chaudhry] left the room at that point maybe to go talk to the family.”

10 (Ex. 115 at 5) Campbell testified she was not aware of these notes when she completed the CMS

11 Report, nor when the amended State Report came out.

12 The CMS 2567, states in one part that: “Cardiovascular Surgeon 1 (CV 1) [Dr. Chaudhry]

13 left the operating room and the hospital premises prior to the stapling of the ribs back to the

14 sternum (bone to bone closure) and prior to the closure of the remainder of the surgical site

15 (fascia – tissue that holds soft organs in place, muscles and skin) during an open heart surgery for

16 Patient 1 in violation of the hospital’s ‘Rules and Regulations.’ ” (Ex. 112 at 6-7; Ex. 505 at 6-

17 7.) The CMS 2567, specifically reported that Utecht and McComb (identified as MD 2 and

18 Admin Staff 2) had both stated during an interview on July 16, 2012, that Dr. Chaudhry (“CV

19 1”) had left the operating room “prior to closure/stapling of the bones back together,” and that

20 “MD 2 and Admin Staff 2 stated PA 1 had stapled the bones in this case without the

21 Cardiovascular Surgeon being present.” (Ex. 505 at 12; Ex. 112 at 12.)12

22 12

McComb testified that at the time she saw the CMS Report, she believed the reference to Dr. Chaudhry leaving at

23 11:30 a.m. was inaccurate as the presentation of Dr. Chaudhry’s interview in the CMS Report did not make sense.

McComb recalled telling Campbell that she had misquoted McComb, as McComb testified she never said Albakova

stapled the chest/sternum after Dr. Chaudhry left, as stapling of the bones together are not words she would use

24

because that is not how that type of surgical closing occurs. McComb testified that she requested Campbell to

correct the statements in the CMS Report, and that Campbell said they were not changing anything. This did not

25 shock McComb as in working with 2567s, she believes CDPH has their truth based on their investigations and

interviews, and CRMC has their truth, and they do not always agree with each other, and at times, there are

26 conversations about inaccuracies. By the time she spoke with Campbell about her concerns, McComb had formed

the opinion that Dr. Chaudhry was in the operating room when the sternum bones were closed, based on her review

27 of the medical records, including the time stamp at the end of Dr. Chaudhry’s dictation indicating 12:15 p.m., and

review of the in/out sheets.

28

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1 A largely similar notation of the interview with McComb and Utecht was entered into the

2 State Report authored by Yussif. (Ex. 113 at 6.) However, the State Report omits reference to

3 the term stapling in regards to this interview, and instead is phrased as: “On 7/16/12 . . . MD 4 . .

4 . and . . . [Admin 1], both stated CVS 1 left the OR prior to closure of the chest bones back

5 together. MD 4 and Admin Staff 1 stated that CVS 1 violated the hospital’s Rules and

6 Regulations under the Bylaws which do not permit the primary surgeon to leave the OR prior to

7 the patient being established as stable.” (Compare Ex. 113 at 6; Ex. 505 at 12) The CMS Report

8 was generally available to Yussif to utilize in completing the State Report, and there were

9 multiple ways that Yussif could have accessed this information at the office, such as a file

10 cabinet, and it is common in these types of investigations for one investigator on CMS side to

11 borrow from the State, or vice versa, such as in the case of an inability to interview a particular

12 individual. Other than the CMS Report being available, Campbell as a supervisor did not direct

13

Significantly however, despite her disagreement with the alleged misquotations regarding the closure of the sternum

14 bones, McComb testified she did not disagree with the statement in the CMS Report (Ex. 112 at 4), that Dr.

Chaudhry left the operating room prior to the “closure” of the chest. This was based on McComb’s belief the team

15 was finishing the last stitches and placing bandages, so Dr. Chaudhry’s exit was right around the time of chest

“closure.” Thus, McComb affirmed in testimony that she had no disagreement with the portion of the CMS Report

16 that Dr. Chaudhry “left the operating room prior to closure.”

17 Utecht testified that he never told Campbell Dr. Chaudhry left the operating room prior to stapling of the bones back

together. When Utecht first reviewed the SOD, Utecht testified he saw the inaccurate quote, but didn’t have a

18 chance to correct at that point, other than through McComb making a phone call explaining that it was incorrect.

Utecht testified he did not speak to Campbell or tell her that CDPH needed to make corrections to the findings, and

19 did not recall any conversation with Campbell where Campbell said something to the effect of “we are not changing

anything.”

20

On the other hand, Campbell testified there is no doubt in her mind that she heard the term “stapling” by Utecht and

21 McComb; that McComb did not call her to tell Campbell that these statements were incorrect or that medical

professionals do not use such a term; that if somebody had called her, she would have double-checked her notes, and

22 worked with them; that if it was clear there was a mistake, there would a “long conversation” with CMS, because

they are the only agency that can alter the records at that point, and she would have to explain why it wasn’t reported

23 accurately; and Campbell testified this has never happened in her entire career.

24 McComb also testified that she did not witness any animosity by Campbell toward the hospital or the staff involved,

and never experienced any personal bias by Campbell before July 2012 against anyone she was conducting surveys

concerning.

25

McComb did not recall telling anyone besides Campbell that the quotes were incorrect. Lopez testified the first time

26 he was aware the hospital was objecting to statements attributed to employees McComb, Schreur, or Utecht, was

well after the POCs had been submitted.

27

The Court addresses the credibility of this testimony and ultimate relevance in the legal analysis section below.

28

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1 Yussif to use any of the information in the CMS Report in the State Report.

2 E. CRMC’s Internal Actions, the Medical Executive Committee’s Investigation

Supported by Outside Expert, & Process of Creating Plan of Correction

3

4 As noted on the State 2567 and CMS 2567, on April 12, 2012, the Medical Executive

5 Committee for CRMC (the “MEC”) “notified [Dr. Chaudhry] by letter to comply with the

6 medical staff bylaws requiring him to remain in the hospital and be available when patients are

7 still in the Operating Room or to arrange for appropriate coverage,” and that the “President of the

8 Medical Staff telephoned the physician and informed [Dr. Chaudhry] of the same expectations

9 and admonished him that failure to adhere to this directive would result in an immediate

10 summary suspension.” (Exs. 112 at 2, 503 at 4, 505 at 2.) The State 2567 and CMS 2567 also

11 state that on April 12, 2012, the MEC:

12 determined it would be in the best interest of both [Dr. Chaudhry] and the MEC if

the case was reviewed by an outside expert. It immediately took steps to send the

13 case in question out for an independent review by an experienced expert

cardiovascular surgeon, even though it was recognized this would cause a time

14 delay in resolution of the matter. On 7/18/2012 the practitioner and the assisting

cardiovascular surgeon were directed by the President of the Medical Staff to

15 amend their documentation in the patient record to reflect what accurately

happened on 4/2/12. The amended documentation was entered into the record on

16 7/19/2012.

17 (Id.) McComb received the information regarding the outside expert recommendation to enter

18 into the POC through working with the MEC.

19 During the federal CMS investigation in July of 2012, there were rumors discussed

20 within CRMC that Davis was making remarks concerning the ability of Davis or CDPH to shut

21 the hospital’s program down. McComb never directly heard Davis make comments regarding

22 shutting the hospital down, no witness in this trial testified that they directly heard these

23 statements, and Davis affirmed in testimony that CDPH does not comport themselves in this

24 alleged fashion. Dr. Chaudhry claims Davis refused to meet with him despite Dr. Chaudhry’s

25 desire to present information from his perspective of the Perez surgery as a cardiothoracic

26 surgeon. Due to the schedule of the survey team, Davis affirmed that if another team member

27 interviewed Dr. Chaudhry, he would not have completed another interview.

28 On or around August 8, 2012, CRMC received a letter informing CRMC that it was being

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1 placed under CMS survey jurisdiction. The August 8, 2012 letter directed CRMC to submit

2 evidence of correction to address the survey to the CMS office in San Francisco office and the

3 CDPH Fresno District office.

4 McComb was generally aware of the ability of CMS to terminate CRMC’s right to

5 Medicare and Medicaid reimbursement. Specifically, she was aware as of August 8, 2012 when

6 CRMC received the letter placing CRMC under CDPH survey jurisdiction that because CRMC

7 was “out of condition” with the CMS Conditions of Participation, that CRMC was on a

8 termination track until they demonstrated compliance. McComb was aware that loss of

9 reimbursement would be devastating to the hospital, as more than 50% of CRMC’s income was

10 reimbursement.

11 On August 15, 2021, Dr. Chaudhry made a presentation at a meeting with the MEC and

12 voiced concerns that the actions of the MEC would have a negative impact on Dr. Chaudhry.

13 Following Dr. Chaudhry’s appearance before the MEC on August 15, 2012, Dr. Chaudhry was

14 dispatched a letter dated August 21, 2012, from Dr. Thomas, President, Medical Staff, of

15 Community Medical Centers. (Ex. 123 at 1.) The letter states Dr. Chaudhry’s appearance was

16 part of the MEC’s ongoing investigation of “issues concerning medical care and [Dr.

17 Chaudhry’s] behavior.” (Id.) The letter also described the recommendations by unanimous vote

18 of the MEC that were supported by the findings of an outside reviewer. (Id.) Under the heading

19 “Medical Record Documentation,” the letter states: “The investigation revealed that [Dr.

20 Chaudhry’s] medical record documentation [was] severely deficient,” and the MEC

21 recommended that Dr. Chaudhry be required to complete a University of California, San Diego

22 Physician Assessment and Clinical Education (PACE) program in medical record documentation

23 within six months. (Id.)

24 The August 21, 2012 letter also informed Dr. Chaudhry that the MEC, after the

25 investigation supported by the outside reviewer, made the following conclusions as to the April

26 2, 2012 surgery of Perez:

27 • There is evidence that the patient was unstable following the conclusion of

surgery;

28

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1 • As a result, the patient was not ready to leave the OR;

2 • The responsibility for the patient’s care under these circumstances rested with

you;

3

• In leaving the OR and the hospital, you failed to designate another physician

4 qualified to provide the necessary coverage or care for this patient

5 • As a result of your failure, there was an untimely response to the patient’s

deteriorating condition;

6

• You have already been directed to either be present or to provide suitable

7 coverage (presence of a privileged cardiothoracic surgeon) following cardiac

surgery cases until the patient is stable in the intensive care unit (“ICU”). This

8 requirement shall remain in place;

9 • You have already been directed to remain in the OR until the patient’s chest is

closed; and

10

• Therefore, a fourteen-day (14) day medical staff membership and clinical

11 privileges suspension is imposed and shall be served within three (3) months of

August 5, 2012.

12

(Ex. 123 at 1-2.) As of August 21, 2012, Dr. Chaudhry aware of all these points raised in the

13

letter.

14

At some point during the investigations, McComb contacted the Physician Assistant

15

Board for the State of California (“PA Board”), and received materials and information

16

clarifying and explaining the responsibility of the overseeing surgeon in working with a

17

physician assistant when a patient is under general anesthesia. After receiving the information,

18

McComb discussed the information with some of the CRMC surgeons, including Dr. William

19

Dominic (“Dominic”), and provided such information regarding how oversight worked and what

20

the expectations of the PA Board were at that time. Based on the information from the PA

21

Board, McComb determined that the CMS SOD was accurate in that there was not proper

22

oversight of the Perez surgery. As for the requirements of supervision as it related to the

23

operating room and the personal presence of a supervising physician, McComb confirmed the

24

requirement was not on the privilege card of physician assistants at CRMC prior to the CDPH

25

and CMS investigations.

26

Accordingly, McComb worked with the director of medical staff office at CRMC to

27

review the privilege cards of the physician assistants, including Albakova’s; worked to ensure

28

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1 the cards were updated to include the required information; and included such fact in the POCs.13

2 Specifically, the POC for both the CMS 2567 and State 2567 note:

3 The Allied Health Professional (Physician Assistant) privilege card was modified

in accordance with Title 16 to state that the personal presence of an approved

4 supervising physician is required when performing surgical procedures under

general anesthesia. The privilege card was approved at MEC on 5/10/2012 and

5 Board of Trustees on 7/17/2012.

6 After the event occurred, the Chair of the Department met individually with the

practitioner and the Physician Assistant. They were directed that the personal

7 presence of an approved supervising physician is required when performing

surgical procedures under general anesthesia at all times.

8

9 (Ex. 503 at 4; Ex. 505 at 2.)

10 On January 28, 2013, CDPH dispatched a letter to CRMC attaching the State 2567 SOD

11 and providing the following information regarding completion of a POC and appeals process:

12 If you disagree with any deficiency, you may submit a written appeal to the

district administrator/district manager of this office. A formal appeal process will

13 be afforded to you if and when an administrative penalty notice is issued to your

facility for an immediate jeopardy deficiency. Please do not request a formal

14 appeal of any penalties until the notice of a penalty is issued.

The plan of correction must be returned within 15 calendar days of receipt of

15 the statement of deficiencies.

16 (Ex. 131 at 2.) This letter was signed by Campbell, on behalf of Spence.

17 After receiving the SOD from CDPH in January of 2013, and as noted above, Utecht did

18 not directly contact Campbell or anybody at the CDPH to express concern or raise a dispute with

19 the SOD. CRMC completed the process of submitting the POC, and the hospital did not submit

20 any formal appeal.

21 In her role of creating and overseeing the POCs for CRMC, McComb generally believed

22 the State SOD and the CMS SOD for the Perez matter were roughly identical, and the POC

23

13

Dr.. Chaudhry claims he met with Thomas before his interview with Campbell, and they specifically discussed at

24

the time that physician assistants did not have privilege cards generally, but only specifically for the emergency

room. Dr. Chaudhry claims the hospital was making cards while he was a director, and gave clinical input to the

25 hospital. Dr. Chaudhry claims that when the survey team came to do interviews, the privilege card for the

emergency room stated that a PA could close the bone and skin, and the hospital was satisfied, but the State was not

26 satisfied in this regard. The hospital then went on to specifically make the privilege cards for each PA. Dr.

Chaudhry recalled every PA coming into the medical staff office, lined up getting their privilege cards and signing

27 applications, and avers this was a reason he was aware of the State investigating. McComb doesn’t remember

specifically, but affirmed it would be custom practice to give the modified privilege card to Campbell and believes

28 the card was modified in May of 2012, following the surgery.

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1 created addressed both. As for the above noted inaccuracies that McComb claims she brought to

2 the attention of Campbell, McComb depends on the fact the POC incorporates a general

3 disclaimer stating the facility does not agree with all things written in the SOD, and the focus of

4 the POC is on the deficiencies beyond the inaccuracies. However, there is no ability of the

5 facility to enter a specific note of disagreement within the POC to address a specific error, if a

6 specific objection was placed in the POC, it was McComb’s understanding the POC would not

7 be accepted.

8 McComb was involved in creating multiple drafts that of the POCs, but was never

9 requested by anyone at CDPH to specifically discipline Dr. Chaudhry. Because CDPH’s

10 jurisdiction only authorizes investigations of hospitals, not individual doctors, Dr. Chaudhry was

11 not directly permitted to complain to CDPH regarding the State 2567 or to CMS regarding the

12 CMS 2567.

13 F. Publication of the State and CMS Reports

14 CDPH did not have a website in 2012, but had a sort of online directory to exchange

15 information between CDPH offices. It is an undisputed fact that on or about October 10, 2013,

16 the CDPH published on its website the State 2567 regarding the events of April 2, 2012. (UF

17 19.)

18 It is an undisputed fact that CDPH did not publish the CMS 2567. (UF 20.)

19 G. Events After Publication Including Amending of the State Report

20 Following the publication of the State 2567, the Medical Board of California began

21 investigating Dr. Chaudhry. (UF 28.) In June 2014, the handwritten notes of the CDPH

22 investigators were provided to Dr. Chaudhry’s attorneys who were representing him in the Perez

23 Malpractice Case. In early December 2014, the Medical Board of California determined that it

24 would take no action against Plaintiff Chaudhry, and it closed the case. That information was

25 provided to CDPH on December 12, 2014.

26 It is undisputed that on November 25, 2014, the CDPH amended the State 2567

27 Statement of Deficiencies (“Amended State 2567”) based on information from CRMC’s hospital

28 risk manager interview and comparison with clinical hospital records that show Dr. Chaudhry

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1 left the operating room at about 12:15 p.m. It is also an undisputed fact that the Amended State

2 2567 still stated that when Dr. Chaudhry left the operating room, Perez was unstable and that Dr.

3 Chaudhry had an unsupervised and unqualified staff in charge in the operating room. The

4 Amended State 2567 was published on the CDPH website.

5 Specifically, both the original and amended reports state in one section that: “Based on

6 staff interviews, clinical record and administrative document review, the hospital failed to

7 implement Cardiovascular Surgery Service policies and procedures and medical staff bylaws

8 when Cardiovascular Surgeon (CVS 1) left the Operating Room (OR) . . .” (Compare Ex. 503 at

9 4 to Ex. 504 at 2.) The original State 2567 then continues: “and the hospital premises prior to the

10 closure of the chest for the open heart surgery on Patient 1.” (Ex. 503 at 4.) In contrast, the

11 Amended State 2567 continues: “. . . before Patient 1 fully stabilized following the conclusion of

12 open heart surgery.” (Ex. 504 at 2.) The original State 2567 then states: “CVS 1 directed

13 Physician Assistant (PA) 1 to be left in-charge, an individual not qualified to be left in-charge of

14 the CV surgery. After CVS 1 left the OR, Patient 1 suffered massive blood loss, cardiac arrest

15 and loss of oxygen to the brain.” (Ex. 503 at 4.) This portion of the Amended State 2567 is

16 identical and only appears to add two words, specifically: adding the word “also” before the

17 word “directed,” and added the word “cardiovascular” before the acronym “CV.” (Compare Ex.

18 503 at 4 to Ex. 504 at 2.)

19 Another change is where the original State 2567 states: “The clinical record for Patient 1

20 was reviewed on 4/17/12 . . . CVS 1 left the OR at 11:45 a.m. PA 1 and MD 1 sutured the chest

21 closed with metallic wire at approximately 12:00 p.m. and then left the OR.” (Ex. 503 at 5.) The

22 Amended State 2567 states: “The clinical record for Patient 1 was reviewed on 4/17/12 . . .

23 Patient 1 came off bypass at 11:45 a.m. PA 1 and MD 1 proceeded to complete the surgery by

24 closing Patient 1’s chest. The closing of Patient 1’s chest consists of closing several layers.

25 CVS 1 left the OR shortly after 12:15 p.m. PA 1 and MD 1 left the OR after completing the

26 surgery shortly thereafter.” (Ex. 504 at 3.)

27 The Amended State 2567 reports that Dr. Chaudhry stated during an interview that he

28 directed Albakova to finish the case, meaning closure of the chest with wires; and that Dr.

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1 Chaudhry allowed Albakova to practice above her privilege card. (Ex. 504 at 7.) The Amended

2 State 2567 also reports that Schreur stated during an interview that Dr. Chaudhry left the

3 operating room prior to the complete closure of the chest. (Ex. 504 at 6.)

4 As noted above, Lopez became aware CRMC was objecting to statements attributed to

5 employees including McComb, Schreur, and Utecht, well after the POCs had been submitted.

6 From the date of publication of the State 2567 on CDPH’s website of October 10, 2013, until the

7 amended State 2567 issued on November 25, 2014, there was no additional investigation

8 completed by Lopez’s department. When Lopez became aware of the inconsistencies, Lopez

9 reported it up to his branch chief and to the office of legal services, it went through the process to

10 review, and the amendments were made to the State 2567. Lopez’s involvement in the

11 amendment was peripheral as it was the Sacramento headquarters office and the office of legal

12 services that looked at the specific sections of the State 2567 and recommended changes after the

13 issues came to their attention by the hospital.

14 Following the incorporation of the draft changes, Lopez reviewed the proposed Amended

15 State 2567 before approving and sending it to go through the same process with the branch chief,

16 office of legal services, and the Sacramento headquarters for final review before being

17 reprocessed and reposted. The changes between the original and amended reports did not alter

18 Lopez’s opinion regarding Yussif’s conclusions that Dr. Chaudhry left the operating room before

19 completion of the closing of the chest, and Lopez still determined that the information contained

20 in the original State 2567 was “materially accurate.” Lopez did not report the changes or

21 reported inconsistencies to CMS.

22 Campbell retired on November 30, 2014, but was not aware at the time that the Amended

23 State Report was created around November 25, 2014. Campbell was generally aware there was a

24 discussion to amend the State Report, but had no specific knowledge one of the changes was to

25 reflect that Dr. Chaudhry left at 12:15 p.m. and not 11:45 a.m. Campbell did not participate in

26 the discussion to make the changes to the State 2567.

27 / / /

28 / / /

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1

H. Dr. Chaudhry’s Removal from Directorship, Non-Renewed Contracts, and

2 Plaintiffs’ Claimed Damages

3

Dr. Chaudhry became Director of Cardiovascular Surgery at CRMC around 2009. On or

4

about July 27, 2012, Dr. Chaudhry received a letter removing him from the position. (Ex. 122.)

5

The letter stated in part:

6

As you should be aware, a full validation survey will be conducted at [CRMC]

7 within the next several weeks . . . [as a] result of preliminary findings shared by

[CMS] resulting from a recent review of an incident which occurred in the

8 operating room with one of your patients. In light of the findings and impeding

survey, we are compelled to take action that demonstrates our commitment to

9 meeting the CMS Conditions of Participation and to the care of our patients . . .It

is hereby requested that you immediately step down as Medical Director of

10 Cardiac Surgery and Thoracic Services at both CRMC and Fresno Heart &

Surgical Hospital.

11

(Ex. 122.)

12

Dr. Chaudhry claims he received approximately $200,000 per year under the directorship

13

contract, though the money technically flowed through Valley Cardiac. The Court notes that one

14

directorship contract introduced into evidence with an unspecified term, appears to state Valley

15

Cardiac would receive compensation not to exceed $99,468 per year. (Ex. 125 at 3-4.) Another

16

directorship contract for a term of January 1, 2012 to December 31, 2012, appears to state Valley

17

Cardiac would receive compensation not to exceed $136,800 per year. (Ex. 124 at 4.) No other

18

directorship contracts were introduced into evidence.

19

Dr. Chaudhry claims damages flowing from a Call Coverage Agreement. (Ex. 126.) that

20

The contract paid $2,500 per 24 hour period on call, and the money flowed into Valley Cardiac,

21

and a portion flowed into Dr. Chaudhry’s medical income. The term of this contract ended on

22

November 30, 2013, and it was not renewed.

23

Dr. Chaudhry claims lost income that previously flowed from a Consultant Services

24

Agreement. (Ex. 127.) Dr. Chaudhry was the direct signatory to this contract which provided

25

compensation in the amount of $300 per hour, for total compensation not to exceed $200,000 per

26

year. (Ex. 127 at 1, 4.) The term of this contract expired in June of 2013 and it was not

27

renewed.

28

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1 Dr. Chaudhry also received income from performing cardiovascular surgery. Dr.

2 Chaudhry claims that in the year 2012, his total medical income was approximately 2.06 million

3 dollars; in 2013 it was approximately 1.7 million dollars; in 2014 it was approximately 1.4

4 million dollars; in 2015 it was negative or net $53,000; in 2016 it was negative; in 2017, there

5 was no net income; and in 2018 it was negative.

6 Dr. Chaudhry claims that after the State Report was “published” to CRMC, the hospital

7 talked to “everybody” and the committees, it became the “word” that Dr. Chaudhry had

8 abandoned his patient with the chest open and his physician assistant to complete the surgery.

9 As a result, he became “stigmatized” resulting in CRMC backing off, and cardiologists wouldn’t

10 call him. By 2014, Dr. Chaudhry claims he had no surgery referrals, and his practice was

11 essentially killed. Dr. Chaudhry claims that 2018 was the last year he performed a surgery, and

12 was doing one or two cases in the previous years.

13 Dr. Chaudhry claims he was unable to maintain or afford the rising costs of

14 medical malpractice insurance by February of 2018. The cost of insurance from NORCAL

15 insurance became unaffordable due to multiple pending medical malpractice cases that were

16 ongoing in the year 2018, including the Perez Malpractice Case. Specifically, on March 19 and

17 20, 2018, the jury in the Perez Malpractice Case awarded damages against the defendants in that

18 matter, Dr. Chaudhry and CRMC, in an amount in excess of 60 million dollars. The verdict

19 amount was ultimately reduced by settlement, to be paid by CRMC and Dr. Chaudhry’s

20 insurance carrier.

21 Dr. Chaudhry claims he cannot obtain consultant work, which would not require

22 malpractice insurance, because the medical community has lost trust in him and he cannot

23 present as a credible witness now. In December of 2017, Dr. Chaudhry moved to Pakistan to

24 teach, and also performs occasional heart surgeries. Dr. Chaudhry claims he is now making

25 approximately $6,250 per month working in Pakistan, and that this is not enough to make “ends

26 meet,” and that he regularly borrows from family.

27 In sum, Dr. Chaudhry claims that his income was on an upward trajectory with business

28 expanding into new areas in California prior to the investigations and reports concerning the

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1 Perez surgery, and that he has lost income in excess of 14 million dollars over the seven year

2 period of 2015 until 2021.

3 IV.

4 CONCLUSIONS OF LAW

5 Plaintiffs’ operative complaint brings two causes of action, both for violation of civil

6 rights and due process pursuant to 42 U.S.C. § 1983. The first cause of action proceeds against

7 Defendant Angell in her official capacity as Director of the CDPH, and seeks declaratory and

8 injunctive relief only. Specifically, Plaintiffs seek a mandatory injunction ordering Defendant

9 Angell to withdraw the “previously false report of CDPH and issue a new report clearly

10 indicating that the original report [is] false, and vindicating Dr. Chaudhry and his medical

11 group.” (FAC, ECF No. 6 at 21.) Plaintiffs’ second cause of action proceeds against Defendants

12 Lopez and Campbell in their personal capacities. Following the withdrawal of Plaintiff Dr.

13 Chaudhry’s claim for damages related to emotional distress, Plaintiffs seek monetary damages

14 for economic harm only. (FAC ¶¶ 72-76, ECF No. 6 at 20, 21; ECF No. 103.)

15 The Court will first summarize the relevant statutes and regulations relating to the

16 government agencies involved in this action before proceeding to the discussion of the legal

17 standards applicable to Plaintiffs’ due process claims under 42 U.S.C. 1983, specifically under

18 the stigma-plus standard.

19 A. The Relevant Law Generally Applicable to CDPH, CMS, and Hospital

Providers such as CRMC

20

21 “The Centers for Medicare and Medicaid Services (“CMS”), a component of the

22 Department of Health and Human Services, administers the Medicare program.” Fox Ins. Co.,

23 715 F.3d at 1214–15. “Under the Medicare statute, 42 U.S.C. §§ 1395–1395kkk–1, the

24 Department reimburses health care providers for services provided to Medicare patients . . .

25 Providers receive Medicare reimbursement for inpatient hospital services through the

26 Prospective Payment System.” PAMC, Ltd. v. Sebelius, 747 F.3d 1214, 1217–18 (9th Cir.

27 2014).

28 State agencies make agreements with the federal government to conduct surveys of

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1 hospitals participating in the Medicare and Medicaid programs to ensure compliance with

2 minimum health and safety standards. 42 C.F.R. §§ 488.10(a)(1), (c). If there is an allegation of

3 substantial non-compliance, the state agency must conduct a series of escalating investigations.

4 See 42 C.F.R. §§ 488.9(a), (c)(2)-(3). CDPH thus ensures hospital compliance through such

5 validation surveys. When conducting surveys, CDPH surveyors record violations, otherwise

6 known as “deficiencies,” and refer hospitals for various enforcement actions. CDPH’s official

7 findings of the hospital survey are presented on a 2567 report, also known as a statement of

8 deficiencies. The 2567 report must be disclosed no later than 90 calendar days after the survey is

9 completed. 42 C.F.R. § 401.133(a).14

10 CDPH also issues administrative penalties to hospitals via the 2567 report under Cal.

11 Health & Safety Code § 1280, et seq. Cal. Health & Safety Code § 1279.2(a) requires onsite

12 investigations if CDPH receives a written or oral complaint indicating an ongoing threat or

13 imminent danger of death or serious bodily harm. Section 1279.3 provides that CDPH shall

14 make information regarding reports of substantiated adverse events and outcomes of inspections

15 and investigations readily accessible to consumers throughout California. However, information

16 such as names of health care professionals shall not be included in the information released. Cal.

17 Health & Safety Code § 1279.3(c).

18 “The state department shall notify the health facility of all deficiencies in its compliance

19 with this chapter and the rules and regulations adopted hereunder, and the health facility shall

20

14

The regulation provides:

21

(a) Statements of deficiencies and survey reports on providers of services prepared by State

22 agencies. (1) Statements of deficiencies based upon official survey reports prepared after January

31, 1973, by a State agency pursuant to its agreement entered into under section 1864 of the Social

23 Security Act and furnished to CMS, which relate to a State agency’s findings on the compliance of

a health care institution or facility with the applicable provisions in section 1861 of the Act and

with the regulations, promulgated pursuant to those provisions, dealing with health and safety of

24

patients in those institutions and facilities; and (2) State agency survey reports. The statement of

deficiencies or report and any pertinent written statements furnished by the institution or facility

25 on the statement of deficiencies shall be disclosed within 90 days following the completion of the

survey by the State agency, but not to exceed 30 days following the receipt of the report by CMS.

26 (See § 401.130(b)(17) for places where statements of deficiencies, reports, and pertinent written

statements will be available.)

27

42 C.F.R. § 401.133(a).

28

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1 agree with the state department upon a plan of correction that shall give the health facility a

2 reasonable time to correct these deficiencies.” Cal. Health & Safety Code § 1280(b). If a facility

3 and state department fail to agree on a POC, and it is determined the deficiency poses an

4 immediate and substantial hazard to the safety of patients, the agency may order implementation

5 of the POC. Id. at § 1280(c)(1). “If the facility does not agree that the deficiency poses an

6 immediate and substantial hazard to the health or safety of patients or if the facility believes that

7 the plan of correction will not correct the hazard, or if the facility proposes a more efficient or

8 effective means of remedying the deficiency, the facility may, within 10 days of receiving the

9 plan of correction from the department, appeal the order to the director. Id.; see also Cal. Health

10 & Safety Code § 1280.5 (“The state department shall accept, consider, and resolve written

11 appeals by a licensee or health facility administrator of findings made upon the inspection of a

12 health facility.”). Similarly, for federal surveys of deficiencies, a facility may dispute survey

13 findings upon receipt of the official statement of deficiencies. 42 C.F.R. § 488.331(a)(2) (“For

14 Federal surveys, CMS offers a facility an informal opportunity, at the facility’s request, to

15 dispute survey findings upon the facility’s receipt of the official statement of deficiencies.”).

16 Pursuant to the Defendants’ request (ECF No. 171 at 1-2), the Court takes judicial notice

17 of the following statutes and regulations applicable to the State 2567 and CMS/Federal 2567

18 processes that may have relevance to the facts underlying this action:

19 1. California Health & Safety Code § 1279.115;

20 2. California Health & Safety Code § 1279.216;

21 15

The statute provides in part: “(a) A health facility licensed pursuant to subdivision (a), (b), or (f) of Section 1250

22 shall report an adverse event to the department no later than five days after the adverse event has been detected, or,

if that event is an ongoing urgent or emergent threat to the welfare, health, or safety of patients, personnel, or

23 visitors, not later than 24 hours after the adverse event has been detected.” Cal. Health & Safety Code § 1279.1.

24 16

The statute provides in part: “(a)(1) In any case in which the department receives a report from a facility pursuant

25 to Section 1279.1, or a written or oral complaint involving a health facility licensed pursuant to subdivision (a), (b),

or (f) of Section 1250, that indicates an ongoing threat of imminent danger of death or serious bodily harm, the

26 department shall make an onsite inspection or investigation within 48 hours or two business days, whichever is

greater, of the receipt of the report or complaint and shall complete that investigation within 45 days.” Cal. Health

27 & Safety Code § 1279.2.

28

47

Case 1:16-cv-01243-SAB Document 183 Filed 09/29/21 Page 48 of 99

1 3. California Health & Safety Code § 1279.317;

2 4. California Health & Safety Code § 1279.618;

3 5. California Health & Safety Code § 128019;

4 17

The statute provides in part:

5 (a) By January 1, 2015, the department shall provide information regarding reports of substantiated adverse

events pursuant to Section 1279.1 and the outcomes of inspections and investigations conducted pursuant to

6 Section 1279.1, on the department’s Internet Web site and in written form in a manner that is readily accessible

to consumers in all parts of California, and that protects patient confidentiality.

7

(b) By January 1, 2009, and until January 1, 2015, the department shall make information regarding reports of

8 substantiated adverse events pursuant to Section 1279.1, and outcomes of inspections and investigations

conducted pursuant to Section 1279.1, readily accessible to consumers throughout California. The department

9 shall also compile and make available, to entities deemed appropriate by the department, data regarding these

reports of substantiated adverse events pursuant to Section 1279.1 and outcomes of inspections and

10 investigations conducted pursuant to Section 1279.1, in order that these entities may post this data on their

Internet Web sites. Entities deemed appropriate by the department shall enter into a memorandum of

11 understanding with the department that requires the inclusion of all data and all hospital information provided

by the department. These entities may include universities, consumer organizations, or health care quality

12 organizations.

(c) The information required pursuant to this section shall include, but not be limited to, information regarding

13 each substantiated adverse event, as defined in Section 1279.1, reported to the department, and may include

compliance information history. The names of the health care professionals and health care workers shall not be

14 included in the information released by the department to the public.

15 Cal. Health & Safety Code § 1279.3.

16 18

The statute provides in part: “(a) A health facility, as defined in subdivision (a), (b), (c), or (f) of Section 1250,

shall develop, implement, and comply with a patient safety plan for the purpose of improving the health and safety

17 of patients and reducing preventable patient safety events. The patient safety plan shall be developed by the facility,

in consultation with the facility's various health care professionals.” Cal. Health & Safety Code § 1279.6.

18

19

The statute provides in part:

19

(b) The state department shall notify the health facility of all deficiencies in its compliance with this chapter and

20 the rules and regulations adopted hereunder, and the health facility shall agree with the state department upon a

plan of correction that shall give the health facility a reasonable time to correct these deficiencies. If at the end of

21 the allotted time, as revealed by inspection, the health facility has failed to correct the deficiencies, the director

may take action to revoke or suspend the license.

22

(c)(1) . . . [I]f the facility fails to implement a plan of correction that has been agreed upon by both the facility

23 and the state department within a reasonable time, the state department may order implementation of the plan of

correction previously agreed upon by the facility and the state department. If the facility and the state department

fail to agree upon a plan of correction within a reasonable time and if the deficiency poses an immediate and

24

substantial hazard to the health or safety of patients, then the director may take action to order implementation of

a plan of correction devised by the state department. The order shall be in writing and shall contain a statement

25 of the reasons for the order. If the facility does not agree that the deficiency poses an immediate and substantial

hazard to the health or safety of patients or if the facility believes that the plan of correction will not correct the

26 hazard, or if the facility proposes a more efficient or effective means of remedying the deficiency, the facility

may, within 10 days of receiving the plan of correction from the department, appeal the order to the director. The

27 director shall review information provided by the facility, the department, and other affected parties and within a

reasonable time render a decision in writing that shall include a statement of reasons for the order. During the

28 period which the director is reviewing the appeal, the order to implement the plan of correction shall be stayed.

48

Case 1:16-cv-01243-SAB Document 183 Filed 09/29/21 Page 49 of 99

1 6. California Health & Safety Code § 1280.120;

2 7. California Health & Safety Code § 1280.321;

3 8. California Health & Safety Code § 1280.522;

4 9. California Code of Regulations, Title 22, § 7010123;

5

6

The opportunity for appeal provided pursuant to this subdivision shall not be deemed to be an adjudicative

7 hearing and is not required to comply with Section 100171.

8 . . . (d) Reports on the results of each inspection of a health facility shall be prepared by the inspector or inspector

team and shall be kept on file in the state department along with the plan of correction and health facility

9 comments. The inspection report may include a recommendation for reinspection . . .

10 . . . (e) All inspection reports and lists of deficiencies shall be open to public inspection when the state

department has received verification that the health facility has received the report from the state department. All

11 plans of correction shall be open to public inspection upon receipt by the state department.

12 Cal. Health & Safety Code § 1280.

13 part:Defendant erroneously cited to “§ 12801.1,” however it appears 1280.1 is the correct citation, which provides in

20

14 (a) Subject to subdivision (d), prior to the effective date of regulations adopted to implement Section 1280.3, if

a licensee of a health facility licensed under subdivision (a), (b), or (f) of Section 1250 receives a notice of

15 deficiency constituting an immediate jeopardy to the health or safety of a patient and is required to submit a

plan of correction, the department may assess the licensee an administrative penalty in an amount not to exceed

16 twenty-five thousand dollars ($25,000) per violation.

17 (b) If the licensee disputes a determination by the department regarding the alleged deficiency or the alleged

failure to correct a deficiency, or regarding the reasonableness of the proposed deadline for correction or the

18 amount of the penalty, the licensee may, within 10 days, request a hearing pursuant to Section 131071. Penalties

shall be paid when appeals have been exhausted and the department's position has been upheld . . .

19

. . . (g) In enforcing this section, the department shall take into consideration the special circumstances of small

20 and rural hospitals, as defined in Section 124840, in order to protect access to quality care in those hospitals.

21 Cal. Health & Safety Code § 1280.1.

21

22 It appears Defendants erroneously § 128.3, however it appears § 1280.3 is the correct section and pertains to

administrative penalties for immediately jeopardy violations: “(a) Commencing on the effective date of the

23 regulations adopted pursuant to this section, the director may assess an administrative penalty against a licensee of a

health facility licensed under subdivision (a), (b), or (f) of Section 1250 for a deficiency constituting an immediate

jeopardy violation as determined by the department.” Cal. Health & Safety Code § 1280.3.

24

22

The statute provides: “The state department shall accept, consider, and resolve written appeals by a licensee or

25 health facility administrator of findings made upon the inspection of a health facility.” Cal. Health & Safety Code §

1280.5.

26

23

The regulation provides in part:

27

(a) The Department shall inspect and license hospitals.

28

49

Case 1:16-cv-01243-SAB Document 183 Filed 09/29/21 Page 50 of 99

1 10. California Code of Regulations, Title 22, § 7043324;

2 11. 42 C.F.R. § 48225;

3 12. 42 C.F.R. § 482.2226

4 (b) Any officer, employee or agent of the Department may, upon presentation of proper identification, enter and

inspect any building or premises at any reasonable time to secure compliance with, or to prevent a violation of,

5 any provision of these regulations . . .

6 . . .(e) The Department shall notify the hospital of all deficiencies of compliance with these regulations and the

hospital shall agree with the Department upon a plan of corrections which shall give the hospital a reasonable

7 time to correct such deficiencies. If at the end of the allotted time, as revealed by repeat inspection, the hospital

has failed to correct the deficiencies, the Director may take action to revoke or suspend the license.

8

(f) Reports on the results of each inspection of a hospital shall be prepared by the inspector or inspection team

9 and shall be kept on file in the Department along with the plan of correction and hospital comments. The

inspection report may include a recommendation for reinspection. All inspection reports, lists of deficiencies

10 and plans of correction shall be open to public inspection without regard to which body performs the inspection.

11 Cal. Code Regs. tit. 22, § 70101.

12

24

The regulation is entitled “Cardiovascular Surgery Service General Requirements,” and provides in part:

(a) Written policies and procedures shall be developed and maintained by the person responsible for the service

13 in consultation with other appropriate health professionals and administration. Policies shall be approved by the

governing body. Procedures shall be approved by the administration and medical staff where such is

14 appropriate. These policies and procedures shall include provision for at least:

15 (1) Definitions of qualifications of physicians for privileges to perform cardiovascular laboratory catheterization

procedures and/or surgery.

16

(2) Regular review of case management, both preoperatively and postoperatively.

17

(3) Collection, processing and retrieval of data on all patients to include at least: diagnosis, procedure

18 performed, pathophysiologic, angiographic, morbidity and mortality data.

19 (4) Recommendations regarding equipment used, procedures performed and staffing patterns in the

catheterization laboratory and cardiovascular surgery units.

20

Cal. Code Regs. tit. 22, § 70433.

21 25

The regulation provides:

22

(a) Statutory basis.

23 (1) Section 1861(e) of the Act provides that—

(i) Hospitals participating in Medicare must meet certain specified requirements; and

(ii) The Secretary may impose additional requirements if they are found necessary in the interest of the health

24

and safety of the individuals who are furnished services in hospitals.

25 42 C.F.R. § 482.1

26 26

The regulation provides in part:

27 The hospital must have an organized medical staff that operates under bylaws approved by the governing body,

and which is responsible for the quality of medical care provided to patients by the hospital . . .

28

50

Case 1:16-cv-01243-SAB Document 183 Filed 09/29/21 Page 51 of 99

1 13. 42 C.F.R. § 482.5127;

2 14. 42 C.F.R. § 488.228;

3 15. 42 C.F.R. § 488.529;

4 16. 42 C.F.R. § 488.730; and

5 17. 42 C.F.R. § 488.931.

6

. . . (b)Standard: Medical staff organization and accountability. The medical staff must be well organized and

7 accountable to the governing body for the quality of the medical care provided to patients . . .

8 . . . (c)Standard: Medical staff bylaws. The medical staff must adopt and enforce bylaws to carry out its

responsibilities.

9

42 C.F.R. § 482.22

10 27

The regulation is entitled “Condition of participation: Surgical services,” and provides in part:

11

If the hospital provides surgical services, the services must be well organized and provided in accordance with

12 acceptable standards of practice. If outpatient surgical services are offered the services must be consistent in

quality with inpatient care in accordance with the complexity of services offered.

13 (a) Standard: Organization and staffing. The organization of the surgical services must be appropriate to the

scope of the services offered . . .

14

(b) Standard: Delivery of service. Surgical services must be consistent with needs and resources. Policies

15 governing surgical care must be designed to assure the achievement and maintenance of high standards of

medical practice and patient care.

16

42 C.F.R. § 482.51.

17

28

This regulation simply introduces the statutory basis for this group of regulations: “This part is based on the

18 indicated provisions of the following sections of the Act.” 42 C.F.R. § 488.2.

19 29

This regulation provides “[a]pplication and re-application procedures for national accrediting organizations.” 42

C.F.R. § 488.5.

20

30

This regulation is entitled “[r]elease and use of accreditation surveys,” and provides in part:

21

A Medicare participating provider or supplier deemed to meet program requirements in accordance with § 488.4

22 must authorize its accrediting organization to release to CMS a copy of its most current accreditation survey and

any information related to the survey that CMS may require (including, but not limited to, corrective action

23 plans).

(a) CMS may determine that a provider or supplier does not meet the applicable Medicare conditions or

requirements on the basis of its own investigation of the accreditation survey or any other information related to

24

the survey.

(b) With the exception of home health agency surveys, general disclosure of an accrediting organization's

25 survey information is prohibited under section 1865(b) of the Act. CMS may publically disclose an

accreditation survey and information related to the survey, upon written request, to the extent that the

26 accreditation survey and survey information are related to an enforcement action taken by CMS.

27 42 C.F.R. § 488.7

28 31

This regulation is entitled “[v]alidation surveys,” and provides in part:

51

Case 1:16-cv-01243-SAB Document 183 Filed 09/29/21 Page 52 of 99

1 The Court now turns to the standards for a stigma-plus claim.

2 B. The Legal Standards for 42 U.S.C. § 1983 Stigma-Plus Claims

3 Section 1983 provides a cause of action for the violation of a plaintiff’s constitutional or

4 other federal rights by persons acting under color of state law. Nurre v. Whitehead, 580 F.3d

5 1087, 1092 (9th Cir 2009); Long v. County of Los Angeles, 442 F.3d 1178, 1185 (9th Cir. 2006);

6 Jones v. Williams, 297 F.3d 930, 934 (9th Cir. 2002). To state a claim under section 1983, a

7 plaintiff is required to show that: (1) each defendant acted under color of state law; and (2) each

8 defendant deprived her of rights secured by the Constitution or federal law. Long, 442 F.3d at

9 1185 (9th Cir. 2006). There is no respondeat superior liability under Section 1983, and

10 therefore, each defendant is only liable for his or her own misconduct. Iqbal, 556 U.S. at 677.

11 To state a claim, Plaintiff must demonstrate that each defendant personally participated in the

12 deprivation of his rights. Jones, 297 F.3d at 934.32

13

14 (a) Basis for survey. CMS may require a survey of an accredited provider or supplier to validate the accrediting

organization's CMS–approved accreditation process. These surveys are conducted on a representative sample

15 basis, or in response to substantial allegations of non-compliance.

16 (1) For a representative sample, the survey may be comprehensive and address all Medicare conditions or

requirements, or it may be focused on a specific condition(s) as determined by CMS.

17

(2) For a substantial allegation of noncompliance, the

18 SA surveys for any condition(s) or requirement(s) that CMS determines is related to the allegations . . .

. . .(c) Consequences of a finding of non-compliance.

19

(1) If a CMS validation survey results in a finding that the provider or supplier is out of compliance with one or

20 more Medicare conditions or requirements, the provider or supplier will no longer be deemed to meet the

Medicare conditions or requirements and will be subject to ongoing review by the SA in accordance with §

21 488.10(a) until the provider or supplier demonstrates compliance.

22 (2) CMS may take actions for the deficiencies identified in the state validation survey in accordance with §

488.24, or may first direct the SA to conduct another survey of the provider's or supplier's compliance with

23 specified Medicare conditions or requirements before taking the enforcement actions provided for at § 488.24.

(3) If CMS determines that a provider or supplier is not in compliance with applicable Medicare conditions or

24

requirements, the provider or supplier may be subject to termination of the provider or supplier agreement under

§ 489.53 of this chapter or of the supplier agreement in accordance with the applicable supplier conditions and

25 any other applicable intermediate sanctions and remedies.

26 42 C.F.R. § 488.9.

27 32

As Plaintiffs highlight in the amended joint pretrial statement (ECF No. 87 at 18), the Ninth Circuit has

“recognized that ‘[t]he requisite causal connection can be established not only by some kind of direct personal

28 participation in the deprivation but also by setting in motion a series of acts by others which the actor knows or

52

Case 1:16-cv-01243-SAB Document 183 Filed 09/29/21 Page 53 of 99

1 “The procedural due process rights of the Fourteenth Amendment apply only when there

2 is a deprivation of a constitutionally protected liberty or property interest.” WMX Techs., Inc. v.

3 Miller (“WMX II”), 197 F.3d 367, 373 (9th Cir. 1999) (citing Bd. of Regents of State Colleges v.

4 Roth, 408 U.S. 564, 569–70 (1972)). “The requirements of procedural due process apply only to

5 the deprivation of interests encompassed by the Fourteenth Amendment’s protection of liberty

6 and property. When protected interests are implicated, the right to some kind of prior hearing is

7 paramount. But the range of interests protected by procedural due process is not infinite.” Bd.

8 of Regents, 408 U.S. at 569–70.

9 The Supreme Court has made it clear that reputation alone is not an interest protected by

10

reasonably should know would cause others to inflict the constitutional injury.’ ” Gini v. Las Vegas Metro. Police

11 Dep’t, 40 F.3d 1041, 1044 (9th Cir. 1994) (quoting Merritt v.

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