Naini v. King County Hospital District No 2

THE HONORABLE JOHN C. COUGHENOUR

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UNITED STATES DISTRICT COURT

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WESTERN DISTRICT OF WASHINGTON

8 AT SEATTLE

9 ALI J. NAINI, CASE NO. C19-0886-JCC

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Plaintiff, ORDER

11 v.

12 KING COUNTY HOSPITAL DISTRICT NO.

2 et al.,

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Defendants.

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16 This matter comes before the Court on Defendants’ partial motion to dismiss (Dkt. No.

17 32). Having considered the parties’ briefing and the relevant record, the Court finds oral

18 argument unnecessary and hereby GRANTS the motion in part and DENIES the motion in part

19 for the reasons explained herein.

20 I. BACKGROUND

21 In early 2012, Plaintiff Ali J. Naini, a neurosurgeon who works at Defendant King

22 County Hospital District No. 2 (“Evergreen”), became concerned that physicians in Evergreen’s

23 intensive care unit were improperly advising his elderly patients to consent to Do Not

24 Resuscitate designations or transfers to end-of-life palliative hospice care without his knowledge.

25 (See id. ¶¶ 32–34.) Plaintiff raised his concerns to Evergreen’s administration, telling the hospital

26 that these patients could be saved with more aggressive treatment. (See id. ¶ 45.) According to

1 Plaintiff, his concerns were not taken seriously. (See id. ¶ 45.) Instead, specific employees at

2 Evergreen purportedly responded by campaigning to have the hospital revoke Plaintiff’s medical

3 staff privileges. (Id. ¶ 220.)

4 The campaign against Plaintiff was allegedly spearheaded by Defendant Melissa D. Lee,

5 M.D., the medical director of Evergreen’s ICU and the director of the hospital’s Quality

6 Assurance Committee. (See id. ¶¶ 24, 46–60.) In 2013, Dr. Lee urged Evergreen to approve a set

7 of “Neurosurgical Co-Management Guidelines” that would limit Plaintiff’s authority over his

8 patients in the ICU. (Id. ¶ 57.) Dr. Lee’s efforts proved successful, and Evergreen ultimately

9 adopted the guidelines on January 5, 2016. (Id. ¶ 59.)

10 That same year, a conflict arose over the treatment of two of Plaintiff’s patients. (Id.

11 ¶ 67.) Plaintiff expressed his concerns regarding those patients’ treatment to Defendant Robert E.

12 Geise, M.D., the then-president of Evergreen’s medical staff. (Id. ¶ 68.) At the same time, Dr.

13 Lee contacted Dr. Geise and asserted that Plaintiff was breaking Evergreen’s new co-

14 management policy. (Id. ¶ 71.) After hearing from Dr. Lee, Dr. Geise met with Defendant James

15 O’Callaghan, M.D., and Dr. Scott Burks on June 23, 2016, to create a “to do” list for Plaintiff.

16 (Id. ¶ 73.) Dr. Geise then held a meeting with Dr. Lee and other ICU staff. (Id. ¶ 76.) At the

17 meeting, Dr. Lee urged Evergreen’s administration to act against Plaintiff. (Id. ¶ 77.) Dr. Geise

18 assured Dr. Lee that he had a “plan for formal review.” (Id.)

19 The day after the meeting, Dr. Geise initiated an ad hoc process that, according to

20 Plaintiff, was intended to justify a Focused Professional Practice Examination-Concern period

21 for Plaintiff.1 (Id.) As part of that process, Dr. Geise appointed Dr. Sean Kincaid as head of a

22 committee to investigate Plaintiff’s patient care. (Id. ¶ 78.) Dr. Geise also instructed two

23 unidentified Evergreen neurosurgeons to perform internal reviews of the medical records of three

24 patients that Plaintiff admitted to the ICU in the spring of 2016. (Id. ¶ 80.) And when that

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1 “An FPPE-C is a time-limited period during which a hospital evaluates and determines a

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physician’s professional performance.” (Id. ¶ 73.)

1 internal review concluded that Plaintiff had given adequate care to those three patients, Dr. Geise

2 commissioned an external reviewer to assess Plaintiff’s care in each case. (Id. ¶¶ 91–92.)

3 Although the reviewer issued a report that was generally favorable towards Plaintiff’s clinical

4 competency, the report raised issues relating to documentation and co-management policies. (Id.

5 ¶¶ 92–96.) Given these purported issues, Defendants subsequently informed Plaintiff on

6 September 12, 2016, that they had created an FPPE-C requiring Plaintiff to complete tasks

7 relating to his communication with colleagues and staff. (Id. ¶ 98.)

8 On April 3, 2017, Dr. Geise sent a letter demanding that Plaintiff also complete a

9 competency assessment at the University of California in San Diego. (Id. ¶ 102.) When Plaintiff

10 refused to undergo the assessment, Dr. Geise sent Plaintiff another letter on September 27, 2017,

11 stating that if Plaintiff did not go to California, “the Medical Staff will consider your non-

12 compliance as a voluntary resignation.” (Id. ¶ 118.) Dr. Geise’s second letter prompted Plaintiff

13 to file the initial complaint in this case in King County Superior Court, requesting a temporary

14 restraining order preventing Evergreen from terminating his privileges. (Id. ¶ 118.) In response to

15 Plaintiff’s request, Defendants withdrew the assessment requirement. (Id. ¶ 119.)

16 After withdrawing the assessment requirement, Evergreen implemented a “Corrective

17 Action Plan” involving an ongoing review of Plaintiff’s cases in 2018. (Id. ¶ 122.) That review

18 identified potential issues in three cases, which were then sent for review to the Credentials

19 Committee. (Id. ¶ 130.) The Credentials Committee met on January 9, 2019, and voted—without

20 hearing from Plaintiff—to not renew his privileges. (Id. ¶¶ 131, 135.) Following the Credential

21 Committee’s decision, Dr. O’Callaghan, who by that time had become president of Evergreen’s

22 medical staff, authored a report purporting to summarize the basis for the decision. (Id. ¶ 137.)

23 On January 14, 2019, the Medical Executive Committee met and accepted the Credential

24 Committee’s recommendation to suspend Plaintiff’s privileges. (Id. ¶ 165.) One day later,

25 Evergreen’s Board of Commissioners also held a meeting, which Dr. O’Callaghan attended. (Id.

26 ¶ 168.) Once the meeting concluded, Dr. O’Callaghan told Dr. Geise that the Board had decided

1 to not renew Plaintiff’s privileges. (Id. ¶ 169.) Dr. O’Callaghan similarly told Plaintiff in a

2 telephone conversation that “the Board upheld the decision of MEC to not recommend re-

3 credentialing” and that Plaintiff’s privileges were therefore terminated. (Id. ¶ 170.) But Plaintiff

4 alleges that Dr. O’Callaghan was incorrect: “the Board had not approved anything.” (Id. ¶ 181.)

5 Even though “[Plaintiff’s] privileges had never been officially rescinded,” (id. ¶ 188),

6 Defendants sent a broadcast email on January 17, 2019, “claiming that the Board had approved

7 [Plaintiff’s] ‘resignation.’” (Id. ¶ 175.) The email was sent to at least 200 hospital personnel, and

8 news of Plaintiff’s alleged resignation circulated quickly throughout the medical community. (Id.

9 ¶¶ 175–82.)

10 On February 1, 2019, the Superior Court vacated the suspension of Plaintiff’s privileges.

11 (Id. ¶ 186.) Plaintiff subsequently amended his complaint to add nine claims for damages against

12 Dr. Geise, Dr. O’Callaghan, Dr. Lee, EvergreenHealth Medical Center Medical Staff,2 and

13 Evergreen. (See id. ¶¶ 192–254.) Because Plaintiff’s amended complaint included federal claims

14 under 42 U.S.C. §§ 1983 and 1985(3), Defendants removed the case to this Court. (Dkt. No. 2.)

15 Following removal, Defendants filed the instant partial motion to dismiss. (Dkt. No. 32.)

16 II. DISCUSSION

17 A. Federal Rule of Civil Procedure 12(b)(6) Legal Standard

18 A defendant may move for dismissal when a plaintiff “fails to state a claim upon which

19 relief can be granted.” Fed. R. Civ. P. 12(b)(6). To survive a motion to dismiss, a complaint must

20 contain sufficient factual matter, accepted as true, to state a claim for relief that is plausible on its

21 face. Ashcroft v. Iqbal, 556 U.S. 662, 677–78 (2009). A claim has facial plausibility when the

22 plaintiff pleads factual content that allows the court to draw the reasonable inference that the

23 defendant is liable for the misconduct alleged. Id. at 678. Although the court must accept as true

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25 2 In Plaintiff’s response to Defendants’ motion to dismiss, Plaintiff voluntarily withdrew all but

his Washington Consumer Protection Act claim against the medical staff. (See Dkt. No. 19.) The

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Court therefore DISMISSES those withdrawn claims without prejudice.

1 a complaint’s well-pleaded facts, conclusory allegations of law and unwarranted inferences will

2 not defeat an otherwise proper Rule 12(b)(6) motion. Vasquez v. L.A. Cty., 487 F.3d 1246, 1249

3 (9th Cir. 2007); Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001). The

4 plaintiff is obligated to provide grounds for their entitlement to relief that amount to more than

5 labels and conclusions or a formulaic recitation of the elements of a cause of action. Bell Atl.

6 Corp. v. Twombly, 550 U.S. 544, 545 (2007). “[T]he pleading standard Rule 8 announces does

7 not require ‘detailed factual allegations,’ but it demands more than an unadorned, the-defendant-

8 unlawfully-harmed-me accusation.” Iqbal, 556 U.S. at 678. Dismissal under Rule 12(b)(6) “can

9 [also] be based on the lack of a cognizable legal theory.” Balistreri v. Pacifica Police Dep’t, 901

10 F.2d 696, 699 (9th Cir. 1988).

11 B. Exclusivity of Wash. Rev. Code § 7.71.030

12 Defendants argue that Wash. Rev. Code § 7.71.030’s exclusive remedies provision

13 requires that this Court dismiss Plaintiff’s various state-law claims. (See Dkt. No. 32 at 7–8).

14 Plaintiff responds with three reasons why the provision does not preclude those claims. First,

15 Plaintiff contends that federal law, not state law, governs this case. (See Dkt. No. 37 at 9–12).

16 Second, Plaintiff claims that even if state law applies, Defendants cannot avail themselves of

17 Wash. Rev. Code § 7.71.030’s protections because Defendants did not comply with the

18 requirements of Wash. Rev. Code § 7.71.050(2). (See id. at 12.) Finally, Plaintiff argues that

19 some of his claims are unrelated to peer review. (See id. at 9.) The Court concludes that Wash.

20 Rev. Code § 7.71.030 provides the exclusive state-law remedy in this case and requires that the

21 Court dismiss Plaintiff’s state-law claims.

22 The Law of the Case

23 As an initial matter, the Court must determine whether the Superior Court already

24 decided that Wash. Rev. Code § 7.71.030 precludes Plaintiff’s state-law claims. Defendants

25 contend that on February 1, 2019, the Superior Court “unequivocally ruled” that the provision

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1 bars those claims.3 (See Dkt. No. 32 at 8.) This prior ruling, Defendants argue, is now the “law of

2 the case” and precludes the Court from considering whether Wash Rev. Code § 7.71.030 bars

3 Plaintiff’s state-law claims. (See id.) Plaintiff disagrees, arguing that the Superior Court never

4 had the opportunity to consider the issue because Plaintiff did not move to amend his complaint

5 to add state-law claims for damages until May 28, 2019. (See Dkt. No. 37 at 7.) The Court agrees

6 with Plaintiff.

7 Under the “law of the case” doctrine, “a court is generally precluded from reconsidering

8 an issue that has already been decided by the same court, or a higher court in the identical case.”

9 See United States v. Alexander, 106 F.3d 874, 876 (9th Cir. 1997) (quoting Thomas v. Bible, 983

10 F.2d 152, 154 (9th Cir. 1993)). The doctrine applies to state court rulings made prior to a case

11 being removed to federal court. See Payne for Hicks v. Churchich, 161 F.3d 1030, 1037 (7th Cir.

12 1998) (citing Granny Goose Foods, Inc. v. Brotherhood of Teamsters & Auto Truck Drivers

13 Local No. 70, 415 U.S. 423, 435–36 (1974)). However, “[f]or the doctrine to apply, the issue in

14 question must have been decided explicitly or by necessary implication in [the] previous

15 disposition.” Milgard Tempering, Inc. v. Selas Corp., 902 F.2d 703, 715 (9th Cir. 1990).

16 Consequently, “[a] significant corollary of the doctrine is that dicta have no preclusive effect.”

17 Id.

18 Here, the Superior Court neither explicitly nor implicitly decided whether Wash. Rev.

19 Code § 7.71.030 bars the state-law claims now before the Court. True, the Superior Court did say

20 at a hearing on February 1, 2019, that the provision “is the exclusive remedy in any lawsuit by a

21 healthcare provider for any action taken by a professional review body of health-care providers.”

22 (See Dkt. No. 32-1 at 53–54.) But that statement merely repeats verbatim the language of Wash.

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3 Defendants’ reply raises a new, separate argument that Plaintiff should be estopped from

24 contradicting his representation to the Superior Court that his “remedies are those specified in

7.71.030.” (See Dkt. No. 38 at 2–4) (quoting Dkt. No. 32-1 at 11). But the Court “need not

25 consider arguments raised for the first time in a reply brief,” see Zamani v. Carnes, 491 F.3d

990, 997 (9th Cir. 2007), and the Court declines to do so here because Plaintiff has had no

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opportunity to explain his representations.

1 Rev. Code § 7.71.030(1); it cannot be construed as a ruling on Plaintiff’s interpretation of the

2 word “applies” in Wash. Rev. Code § 7.71.030(1), his argument about how that provision

3 interacts with Wash. Rev. Code § 7.71.050(2), or his assertion that some of his claims do not

4 relate to Defendants’ professional review action. See Rebel Oil Co., Inc. v. Atl. Richfield Co., 146

5 F.3d 1088, 1094 (9th Cir. 1998) (declining to apply the law of the case doctrine because prior

6 judicial statements were “better read as descriptions rather than dispositions of Rebel’s claims”);

7 (Dkt. No. 38 at 8–13). None of those arguments were before the Superior Court on February 1

8 because Plaintiff did not amend his complaint to add additional claims for damages until several

9 months later. (See Dkt. No. 28.) Moreover, if the Superior Court had intended to preclude future

10 claims for damages, then it would not have made a point to dismiss Plaintiff’s claim under the

11 Washington Consumer Protection Act, Wash. Rev. Code § 19.86.060, “without prejudice to any

12 breach of contract or similar claim he may have.” (See Dkt. No. 32-1 at 52.) The Superior

13 Court’s decision to leave open the possibility of future claims for damages shows how up until

14 the February 1 hearing, “[Plaintiff’s privileges] ha[d] always been the subject of [the] litigation.”

15 (See id. at 16–17.)

16 Even assuming that the Superior Court did intend to pass judgment on the meaning of

17 Wash. Rev. Code § 7.71.030, the Superior Court’s statement would be dicta. When the Superior

18 Court held the February 1 hearing, Plaintiff had raised only a single damages claim—a claim

19 relating to Defendants’ decision to reduce Plaintiff’s involvement in emergency room call

20 coverage. (See Dkt. No. 13-8 at 28, 34.) In dismissing that claim, the Superior Court did not rely

21 on Wash. Rev. Code § 7.71.030. (See Dkt. No. 32-1 at 33.) Instead, the Superior Court

22 concluded that Defendant’s decision did not impact the public interest within the meaning of the

23 CPA. (Id.) It would therefore have been unnecessary for the Superior Court to decide whether

24 Wash. Rev. Code § 7.71.030 might impede Plaintiff’s ability to bring claims for damages

25 relating to the suspension of his privileges. Accordingly, the Court declines to treat any such

26 statements as the “law of the case” and will independently evaluate whether and how Wash. Rev.

1 Code § 7.71.030 applies here. See Rebel Oil, 146 F.3d at 1093–94.

2 The Applicability of Wash. Rev. Code § 7.71.030

3 Washington provides two layers of legal protection for persons who participate in a

4 professional peer review action. The first layer comes from federal law. See 42 U.S.C.

5 § 11111(a); Wash. Rev. Code § 7.71.020. Under that layer of protection, persons who participate

6 in a “professional review action . . . shall not be liable in damages . . . with respect to the action.”

7 42 U.S.C. § 11111(a)(1). This “peer review immunity” applies only if (1) the professional review

8 action was based on a physician’s competence or professional conduct and (2) the action meets

9 four requirements listed in 42 U.S.C. § 11112(a). See 42 U.S.C. §§ 11111(a)(1) (limiting

10 damages “[i]f a professional review action (as defined in section 11151(9) of this title) . . . meets

11 all the standards specified in section 11112(a) of this title”), 11151(9) (“The term ‘professional

12 review action’ means an action . . . which is based on the competence or professional conduct of

13 an individual physician.”). If peer review immunity does not apply, then Wash. Rev. Code

14 § 7.71.030 offers a second layer of protection by limiting the state-law remedies that a health

15 care provider can recover “in any lawsuit . . . for any action taken by a professional peer review

16 body of health care providers.” See Wash. Rev. Code § 7.71.030(1). Those remedies are limited

17 “to appropriate injunctive relief, and damages shall be allowed only for lost earnings directly

18 attributable to the action taken by the professional peer review body, incurred between the date

19 of such action and the date the action is functionally reversed by the professional peer review

20 body.” See id. § 7.71.030(2).

21 Wash. Rev. Code § 7.71.030 did not always offer such generous protections. Originally,

22 42 U.S.C. § 11111(a) and Wash. Rev. Code § 7.71.030 covered different types of professional

23 review actions, with the former covering actions “based on the competence or professional

24 conduct of an individual physician,” see 42 U.S.C. § 11151(9), and the latter covering actions

25 “based on matters not related to the competence or professional conduct of a health care

26 provider,” see 1987 Wash. Sess. Laws 969 (emphasis added). But in 2013, the Washington

1 Legislature extended Wash. Rev. Code § 7.71.030’s protections to actions related to a

2 physician’s competence or professional conduct. See 2013 Wash. Sess. Laws 1716. In doing so,

3 the Legislature added language stating that Wash. Rev. Code § 7.71.030 provides the exclusive

4 remedy in lawsuits relating to a professional review action only “[i]f the limitation on damages

5 under RCW 7.71.020 and [42 U.S.C. § 11111(a)] does not apply.” See id.

6 Plaintiff claims that Wash. Rev. Code § 7.71.030’s exclusivity provision is inapplicable

7 in this case because 42 U.S.C. § 11111(a) “applies.” (See Dkt. No. 37 at 9–12.) To determine the

8 meaning of a statutory term, a court must first look to the statute’s text. See King v. Burwell, 135

9 S. Ct. 2480, 2489 (2015). “If the statutory language is plain, [a court] must enforce it according

10 to its terms.” Id. (citing Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242, 251 (2010)).

11 Often, however, the “meaning—or ambiguity—of certain words or phrases may only become

12 evident when placed in context.” FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120,

13 133 (2000). Consequently, courts must read words “in their context and with a view to their

14 place in the overall statutory scheme.” Id. If a statute’s language is ambiguous even when read in

15 context, then a court may look to legislative history to shed further light on the statute’s meaning.

16 See Wis. Pub. Intervenor v. Mortier, 501 U.S. 597, 611 n.4 (1991).

17 In this case, Plaintiff’s definition of “apply” is too broad. Under that definition, 42 U.S.C.

18 § 11111(a) “applies”—and Wash. Rev. Code § 7.71.030 does not—whenever a professional

19 review board takes an action based on a physician’s competence or professional conduct. (See

20 Dkt. No. 37 at 10.) This definition would render the 2013 amendment a nullity by making Wash.

21 Rev. Code § 7.71.030 protect defendants only when a professional review board acted based on

22 something other than a physician’s competence or professional conduct. Plaintiff’s definition is

23 therefore contrary to the common-sense rule that “[w]hen [the legislature] acts to amend a

24 statute, we presume it intends its amendment to have real and substantial effect.” See Stone v.

25 INS, 514 U.S. 386, 397 (1995).

26 The better understanding of Washington’s statutory scheme is that Wash. Rev. Code

1 § 7.71.030 limits the damages a plaintiff may obtain in cases where a plaintiff can show that the

2 defendant is not entitled to peer review immunity under federal law. This understanding is

3 consistent with the scheme that the Washington Legislature established in 2013 when it extended

4 Wash. Rev. Code § 7.71.030’s protections to cases that are potentially covered by 42 U.S.C.

5 § 11111(a). That understanding is also consistent with the text of 42 U.S.C. § 11111(a), which

6 creates two categories of cases where a defendant is not entitled to peer review immunity. In the

7 first category, a defendant is not entitled to immunity if the professional review action was based

8 on something other than the physician’s competence or professional conduct. See 42 U.S.C.

9 §§ 11111(a)(1) (limiting damages for professional review actions “as defined in section

10 11151(9)”), 11151(9) (defining a professional review action as an action “based on the

11 competence or professional conduct of an individual physician”). In the second category, the

12 action may be based on the physician’s competence or professional conduct, but the defendant is

13 still not entitled to immunity if the action does not meet 42 U.S.C. § 11112(a)’s requirements.

14 See 42 U.S.C. § 11111(a)(1) (limiting damages only “if a professional review action . . . meets

15 all the standards specified in section 11112(a)”).

16 For the purpose of resolving Defendants’ motion to dismiss, this case falls into the

17 second category because Defendants are asking the Court to assess the viability of Plaintiff’s

18 state-law claims while assuming that Defendants are not entitled to peer review immunity. (See

19 Dkt. No. 38 at 7.) Consequently, Wash. Rev. Code § 7.71.030 “applies.”

20 The Effect of Wash. Rev. Code § 7.71.050(2)

21 Plaintiff argues that even if Wash. Rev. Code § 7.71.030 applies, Defendants should not

22 receive the provision’s protections because Defendants did not comply with Wash. Rev. Code

23 § 7.71.050(2). According to Plaintiff, Wash. Rev. Code § 7.71.050(2) revokes Wash. Rev. Code

24 § 7.71.030’s protections if a professional review action does not meet the requirements of 42

25 U.S.C. § 11112(a). Plaintiff’s interpretation implies a relationship between Wash. Rev. Code

26 §§ 7.71.030 and 7.71.050(2) that does not exist.

1 To be fair, Wash. Rev. Code § 7.71.050(2) is not a model of clarity. The provision states,

2 “A professional peer review action taken by a health care facility that imposes a revocation,

3 suspension, or reduction of medical staff privileges or membership must meet the requirements

4 of and is subject to 42 U.S.C. Sec. 11112,” but it does not explain what happens if an action fails

5 to meet those requirements. See Wash. Rev. Code § 7.71.050(2). However, Wash. Rev. Code

6 § 43.70.075 does explain Wash. Rev. Code § 7.71.050(2)’s effect. Wash. Rev. Code

7 § 43.70.075(1)(d) authorizes “[a] whistleblower who . . . has been subjected to reprisal or

8 retaliatory action” to file a civil action against a retaliating health care facility. The statute then

9 defines “reprisal or retaliatory action” to include “the revocation, suspension, or reduction of

10 medical staff membership or privileges without following a medical staff sanction process that is

11 consistent with RCW 7.71.050.” See Wash. Rev. Code § 43.70.075(3)(c). This statutory context

12 shows that Wash. Rev. Code § 7.71.050(2)’s purpose is to offer protections to whistleblowers,

13 not to limit the scope of Wash. Rev. Code § 7.71.030.

14 Wash. Rev. Code § 7.71.050(2)’s legislative history confirms that the Washington

15 Legislature added the provision to protect whistleblowers. The legislature created Wash. Rev.

16 Code § 7.71.050(2) in 2019 when it enacted substitute house bill 1049. See 2019 Wash. Sess.

17 Laws 453. The final bill report refers to SHB 1049 as a bill “[c]oncerning health care provider

18 and health care facility whistleblower protections.” Final H. Rep. 66-1049, Reg. Sess., at 1

19 (Wash. 2019). The report then announces that SHB 1049 creates a new cause of action for

20 whistleblowers who are subject to reprisal or retaliatory action by a health care provider or health

21 care facility. Id. Finally, the report explains how SHB 1049 defines the term “reprisal or

22 retaliatory action,” saying, “[a]bsent the adherence to a medical staff privilege sanction process,

23 any reduction of medical staff membership or privileges qualifies as ‘reprisal or retaliatory

24 action.’” Id. at 2. The report makes no mention of Wash. Rev. Code § 7.71.030. See id. at 1–2.

25 Given that the Washington Legislature evidently created Wash Rev. Code § 7.71.050(2)

26 to protect whistleblowers by helping to define the term “reprisal or retaliatory action,” the Court

1 concludes that the provision does not silently limit Wash. Rev. Code § 7.71.030’s protections.

2 The Scope of Wash. Rev. Code § 7.71.030

3 Having determined that Wash. Rev. Code § 7.71.030 applies and is not limited by Wash.

4 Rev. Code § 7.71.050(2), the Court must decide which of Plaintiff’s state-law claims are

5 precluded by Wash. Rev. Code § 7.71.030’s exclusive remedy provision.

6 Wash Rev. Code § 7.71.030’s scope is not immediately clear from its text. Wash. Rev.

7 Code § 7.71.030(1) states, “this section shall provide the exclusive remedy in any lawsuit . . . for

8 any action taken by a professional peer review body of health care providers.” But the provision

9 does not define the term “action,” and that term is not defined elsewhere in Washington’s code.

10 Federal law, on the other hand, does define the term “professional review action.” Under that

11 definition, professional review action includes (1) “an action or recommendation of a

12 professional review body . . . which affects (or may affect) adversely the clinical privileges . . . of

13 the physician” and (2) “professional review activities relating to a professional review action.”

14 See 42 U.S.C. § 11151(9). “Professional review activity” is, in turn, defined as “an activity of a

15 health care entity . . . to determine whether the physician may have clinical privileges with

16 respect to . . . the entity.” See id. § 11151(10). These definitions are incorporated into

17 Washington law. See Wash. Rev. Code § 7.71.020; Smigaj v. Yakima Valley Mem’l Hosp. Ass’n,

18 269 P.3d 323, 331–32 (Wash. Ct. App. 2012). Accordingly, Wash. Rev. Code § 7.71.030

19 provides the exclusive remedy for any lawsuit for “professional review action” or “professional

20 review activit[y] relating to a professional review action” as defined by 42 U.S.C. § 11151(9)–

21 (10). And given Wash. Rev. Code § 7.71.030’s broad scope, the Court must dismiss Plaintiff’s

22 state-law claims.

23 i. CPA Claim

24 Plaintiff’s CPA claim is precluded by Wash. Rev. Code § 7.71.030. The thrust of

25 Plaintiff’s CPA claim is that “Defendants used the peer review process to baselessly retaliate

26 against [Plaintiff] for raising ethical concerns regarding patient care at Evergreen Hospital.” (See

1 Dkt. No. 28 ¶ 193.) This is a claim for Defendants’ professional review action regarding

2 Plaintiff’s privileges and for Defendants’ professional review activity relating to that action. See

3 42 U.S.C. § 11151(9)–(10); Perry v. Rado, 230 P.3d 203, 208–09 (2010) (affirming dismissal of

4 claims for breach of due process, breach of contract, and breach of fiduciary duties because

5 Wash. Rev. Code § 7.71.030 precluded those claims). Consequently, the Court DISMISSES

6 Plaintiff’s CPA claim with prejudice.4

7 ii. Defamation Claim

8 Plaintiff’s defamation claim presents a harder case because it involves multiple alleged

9 statements. Specifically, Plaintiff alleges that Defendants defamed him by (1) publishing Dr.

10 O’Callaghan’s Credentials Committee report, which explained the Committee’s decision to

11 recommend non-renewal of Plaintiff’s privileges; (2) broadcasting an email announcing that

12 Plaintiff no longer had hospital privileges because he “resigned”; and (3) making “subsequent

13 communications.” (See id. ¶ 199.) Each of these statements presents different issues.

14 The first two statements cannot form the basis of a defamation claim given Wash. Rev.

15 Code § 7.71.030. The first statement, Dr. O’Callaghan’s report, is quintessential “professional

16 review activity relating to a professional review action”: it was meant to help Evergreen

17 determine if the hospital would renew Plaintiff’s privileges. See 42 U.S.C. § 11151(10). The

18 second statement, the broadcast email, is “professional review action” because an

19 “announcement of a change in a physician’s status is inherently part of the ‘professional review

20 action’ protected by [42 U.S.C. § 11111(a)].” Smigaj, 269 P.3d at 323 (quoting Gabaldoni v.

21 Wash., Cty. Hosp. Ass’n, 250 F.3d 255, 260 n.4 (4th Cir. 2001)). Consequently, Wash. Rev.

22 Code § 7.71.030 precludes Plaintiff from bringing a defamation claim for either statement.

23 The “subsequent communications” Plaintiff refers to are a different matter. In theory, it is

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25 4 Because the Court dismisses Plaintiff’s CPA claim on the ground that it is barred by Wash Rev.

Code § 7.71.030, the Court need not decide whether Washington law permits CPA claims

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against municipal corporations or unincorporated associations. (See Dkt. No. 37 at 18–24.)

1 unlikely that defamatory communications made after Defendants announced the change in

2 Plaintiff’s status are “professional review action” or “professional review activity relating to a

3 professional review action.” See 42 U.S.C. § 11151(9)–(10). However, Plaintiff’s complaint

4 mentions only one subsequent communication. (See Dkt. No. 28 ¶ 190.) That communication

5 was made in a public filing during the course of judicial proceedings. (See id.) It is, therefore,

6 absolutely privileged under Washington law. See Twelker v. Shannon & Wilson, Inc., 564 P.2d

7 1131, 1133 (Wash. 1977).

8 Because Plaintiff’s complaint references only statements that are either privileged or

9 covered by Wash. Rev. Code § 7.71.030, the Court DISMISSES Plaintiff’s defamation claim.

10 However, Plaintiff could cure the deficiencies in this claim by alleging facts establishing that

11 Defendants made non-privileged, defamatory statements after Defendants’ announcement that

12 Plaintiff no longer had hospital privileges. The Court therefore GRANTS Plaintiff leave to

13 amend his complaint to allege, if he can, that Defendants made such statements.

14 iii. False Light

15 Plaintiff’s false light claim suffers from the same deficiencies as his defamation claim.

16 (See Dkt. No. 28 ¶ 206.) Consequently, the Court DISMISSES Plaintiff’s false light claim. The

17 Court also GRANTS Plaintiff leave to amend his complaint to allege, if he can, that Defendants

18 made actionable statements after Defendants sent the broadcast email.

19 iv. Tortious Interference with Business Expectancy

20 Wash. Rev. Code § 7.71.030 precludes Plaintiff’s claim for tortious interference with his

21 business expectancy. That claim is based on Defendants “retaliatory, bad faith, and improper

22 termination of [Plaintiff’s] privileges and their publication of false and defamatory statements

23 about [Plaintiff].” (See id. ¶ 212.) As previously explained, these acts are either professional

24 review action or professional review activity relating to professional review action. See Perry,

25 230 P.3d at 208–09. Accordingly, the Court DISMISSES Plaintiff’s tortious interference claim

26 with prejudice.

1 v. Intentional Infliction of Emotional Distress

2 The acts underpinning Plaintiff’s claim for intentional infliction of emotional distress are

3 identical to the facts underpinning his CPA and tortious interference claims. (See id. ¶ 216.) And

4 like those other claims, Plaintiff’s IIED claim is barred by Wash. Rev. Code § 7.71.030. See

5 Perry, 230 P.3d at 208–09. The Court therefore DISMISSES Plaintiff’s IIED claim with

6 prejudice.

7 vi. Civil Conspiracy

8 Plaintiff’s state-law civil conspiracy claim is also precluded by Wash. Rev. Code

9 § 7.71.030 because the claim relates to Defendants’ alleged attempt to “terminate Plaintiff’s

10 privileges . . . through the use of a sham peer review.” (Id. ¶ 220); see Perry, 230 P.3d at 208–09.

11 Accordingly, the Court DISMISSES Plaintiff’s state-law civil conspiracy claim with prejudice.

12 C. Plaintiff’s § 1983 Claim

13 In addition to bringing state-law claims, Plaintiff brings two claims under 42 U.S.C.

14 § 1983. First, Plaintiff asserts that Defendants violated his First Amendment rights by revoking

15 his medical staff privileges in retaliation for his whistleblowing activity. (See Dkt. No. 28

16 ⁋⁋ 223–33.) Second, Plaintiff alleges that Defendants deprived him of his property interest in his

17 privileges and his liberty interest in his reputation without due process. (See id. ⁋⁋ 234–48.)

18 Defendants respond that Plaintiff has failed to allege sufficient facts to support a § 1983 claim

19 against Evergreen and the individual defendants in their official capacities. (See Dkt. No. 32 at

20 13). The Court agrees with Defendants because Plaintiff has failed to allege that the Board of

21 Commissioners ever ratified the suspension of Plaintiff’s privileges or that the individual

22 defendants’ acts may be imputed to Evergreen.

23 Municipal entities, including municipal officials acting in their official capacities, may be

24 sued under § 1983. Monell v. Dep’t. of Soc. Servs., 436 U.S. 658, 694 (1978); Tanner v. Heise,

25 879 F.2d 572, 582 (9th Cir. 1989). However, a municipal entity is not vicariously liable for the

26 acts of its employees; it must “cause” the plaintiff’s injury. Monell, 436 U.S. at 694; Tanner, 879

1 F.2d at 582. A municipality can cause a plaintiff’s injury in “one of three ways.” Gillette v.

2 Delmore, 979 F.2d 1342, 1346 (9th Cir. 1992). First, the municipality’s employee might commit

3 a constitutional violation while acting pursuant to a government policy, practice, or custom. Id.

4 Second, an employee endowed with “final policy-making” authority might violate the plaintiff’s

5 rights in such a way that the employee’s action constitutes an act of official governmental policy.

6 Id. Third, “an official with final policy-making authority [might] ratif[y] a subordinate’s

7 unconstitutional decision or action and the basis for it.” Id.

8 Here, Plaintiff argues that Evergreen is liable because the Board of Commissioners is a

9 final policy maker that made the final decision to revoke his privileges. (See Dkt. No. 37 at 14)

10 (citing Dkt. No. 28 ¶¶ 168–70). But the part of the complaint that Plaintiff points to does not say

11 that the Board ratified the Credential Committee’s recommendation to suspend his privileges.

12 (See Dkt. No. 28 ¶¶ 168–70). Rather, the complaint merely states, “Dr. O’Callaghan told

13 [Plaintiff] in a telephone conversation that ‘the Board upheld the decision of MEC to not

14 recommend re-credentialing.’” (See id.) (emphasis added). And later in the complaint, Plaintiff

15 pleads that the Board never ratified anything. According to Plaintiff, “Dr. O’Callaghan has

16 acknowledged that the [broadcast] email was false: it claimed that [Plaintiff] had ‘resigned’ with

17 Board approval when, in fact, he had not resigned and the Board had not approved anything.”

18 (Id. ¶ 181) (emphasis added); (see also id. ¶ 188) (“This email did not take any steps to explain

19 that . . . his privileges had never been officially rescinded.”). Given Plaintiff’s affirmative

20 representations in the complaint that the Board “had not approved anything,” Plaintiff has not

21 alleged sufficient facts to establish that Evergreen is liable for the Board’s actions.

22 As with the Board’s actions, the other acts discussed in the complaint do not establish

23 municipal liability. While Plaintiff refers to the “actions of Defendants O’Callaghan, Geise, and

24 Lee,” Plaintiff does not plead that those defendants are endowed with final policy-making

25 authority. (See Dkt. No. 28 ¶ 231.) Plaintiff also states that a “custom, policy, or practice of

26 [Evergreen] caused the violations of Plaintiff’s constitutional rights,” but he does not point to

1 any such custom, policy, or practice. (See Dkt. No. 28 ¶ 237). “Rule 12(b)(6) . . . requires more

2 than labels and conclusions, and a formulaic recitation of a cause of action’s elements will not

3 do.” Twombly, 550 U.S. at 545.

4 Because Plaintiff has failed to allege facts showing that a final policy maker ratified an

5 unconstitutional act or that Evergreen otherwise caused a violation of his rights, the Court

6 DISMISSES Plaintiff’s § 1983 claim against Evergreen and the individual defendants in their

7 official capacities. However, the Court recognizes that there is some uncertainty as to whether

8 Plaintiff is pleading that the Board ratified the decision to suspend his privileges. (Compare Dkt.

9 No. 28 ¶ 181, with id. ¶ 241.) The Court therefore GRANTS Plaintiff leave to amend his

10 complaint to allege, if he can, that the Board ratified the decision to suspend his privileges.

11 D. The Applicability of the Intra-corporate Conspiracy Doctrine to 42 U.S.C.

12 § 1985(3)

13 Plaintiff also brings a claim under 42 U.S.C. § 1985(3), alleging that Drs. O’Callaghan,

14 Lee, and Geise conspired to deprive Plaintiff of his due process and First Amendment rights.

15 (See Dkt. No. 28 ¶¶ 249–54.) Defendants argue that Plaintiff’s § 1985(3) claim is barred by the

16 intra-corporate conspiracy doctrine. (See Dkt. Nos. 32 at 15–17, 38 at 10–12.) Plaintiff responds

17 that the doctrine does not apply in this case. (See Dkt. No. 37 at 15–18.) The Court agrees with

18 Plaintiff and holds that the intra-corporate conspiracy doctrine does not bar Plaintiff from

19 bringing a § 1985(3) claim against agents acting on a municipal corporation’s behalf.5

20

5 It is unclear from Plaintiff’s complaint whether he alleges a § 1985(3) claim against the

21

individual defendants and Evergreen Hospital. (See Dkt. No. 28 ¶¶ 249–54.) Plaintiff’s response

22 to Defendants’ motion to dismiss, however, refers to his “clai[m] against Evergreen

Hospital . . . under 42 U.S.C. §§ 1983 and 1985.” (See Dkt. No. 37 at 13.) To the extent that

23 Plaintiff has asserted a § 1985(3) claim against Evergreen Hospital, the Court DISMISSES the

claim because he has failed to assert that the Board ratified any part of the individual defendants’

24 conspiracy. See supra Section C. The Court also notes that the parties have not briefed whether

the intra-corporate conspiracy doctrine should immunize a corporation from liability even if it

25

does not immunize the corporation’s agents. See Novotny v. Great Am. Fed. Sav. & Loan Ass’n,

26 584 F.2d 1235, 1257–58 (3d Cir. 1978) (refusing to apply the doctrine but limiting its holding to

claims brought against a corporate entity’s officers and directors). The Court therefore limits its

1 The intra-corporate conspiracy doctrine rests on the legal fiction that a corporation and its

2 agents are a “single entity” working in tandem to accomplish the corporation’s objectives. See

3 Nelson Radio & Supply Co. v. Motorola, Inc., 200 F.2d 911, 913–14 (5th Cir. 1952). Because a

4 corporation and its agents are a single entity, courts have held that they cannot “conspire” with

5 one another. See, e.g., Girard v. 94th St. & Fifth Ave. Corp., 530 F.2d 66, 70–71 (2d Cir. 1976);

6 Nelson Radio, 200 F.2d at 913–14. A conspiracy must involve multiple actors, these courts

7 reason, and an intra-corporate “conspiracy” involves only a single actor. See Nelson Radio, 200

8 F.2d at 913–14. Accordingly, when a corporation’s agents act within the scope of their

9 employment to accomplish an objective, neither the corporation nor its agents can be held liable

10 for conspiracy. See McAndrew v. Lockheed Martin Corp., 206 F.3d 103, 1036–37 (11th Cir.

11 2000).

12 The intra-corporate conspiracy doctrine first emerged in the 1950s in a context very

13 different from § 1985. In Nelson Radio & Supply Co. v. Motorola, Inc., 200 F.2d 911, 913–14

14 (5th Cir. 1952), the Fifth Circuit held that Nelson Radio failed to state a claim for “conspiracy”

15 under section 1 of the Sherman Act because the alleged conspiracy involved only Motorola’s

16 president, sales managers, and officers. “The Act,” the Fifth Circuit concluded, “does not purport

17 to cover a conspiracy which consists merely in the fact that the officers of the single defendant

18 corporation did their day to day jobs in formulating and carrying out its managerial policy.” Id. at

19 914. This conclusion, the Supreme Court later explained, was supported by the Sherman Act’s

20 text and policies. See Copperweld Corp. v. Indep. Tube Corp, 467 U.S. 752, 767–77 (1984). That

21 text makes a “basic distinction between concerted and independent action” to foster healthy

22 competition. Id. at 767. While section 1 prohibits unhealthy competition by banning concerted

23 action that retrains trade, the section allows a single firm to compete in the market place. Id. at

24 768–69. It is only when a firm attempts to monopolize that section 2 regulates the firm’s

25

holding to the narrow issue of whether the intra-corporate conspiracy doctrine bars Plaintiff’s §

26

1985(3) claim against Drs. O’Callaghan, Lee, and Geise in their individual capacities.

1 independent actions. Id. This critical distinction between section 1 and section 2 would be

2 undermined if section 1 were read to prohibit intra-corporate conspiracies. Id. at 769–70.

3 Over time, a majority of circuits have imported the intra-corporate conspiracy doctrine

4 from the Sherman Act into § 1985. See Grider v. City of Auburn, 618 F.3d 1240, 1261–62 (11th

5 Cir. 2010); Hartline v. Gallo, 546 F.3d 95, 99 n.3 (2d Cir. 2008); Amadasu v. Christ Hosp., 514

6 F.3d 504, 507 (6th Cir. 2008); Benningfield v. City of Houston, 157 F.3d 369, 378 (5th Cir.

7 1998); Hartman v. Bd. of Trs. of Cmty. Coll. Dist. No. 508, 4 F.3d 465, 469–71 (7th Cir. 1993);

8 Richmond v. Bd. of Regents of Univ. of Minn., 957 F.2d 595, 598 (8th Cir. 1992); Buschi v.

9 Kirven, 775 F.2d 1240, 1252–53 (4th Cir. 1985). In doing so, courts have offered varying

10 reasons for why the doctrine should apply in civil rights cases. Most courts describe the doctrine

11 as a kind of natural law. See, e.g., Doherty v. Am. Motors Corp., 728 F.2d 334, 339 (6th Cir.

12 1984) (quoting Nelson Radio, 200 F.2d at 914) (“A corporation cannot conspire with

13 itself . . . and it is the general rule that the acts of the agent are the acts of the corporation.”). And

14 a few try to ground the doctrine in history. See Travis v. Gary Cmty. Mental Health Ctr., Inc.,

15 921 F.2d 108, 110 (7th Cir. 1990). But the Ninth Circuit has never decided the issue, see Mustafa

16 v. Clark Cty. Sch. Dist., 151 F.3d 1169, 1181 (9th Cir. 1998), and other courts refuse to apply the

17 doctrine to § 1985, see Brever v. Rockwell Int’l Corp., 40 F.3d 1119, 1127 (10th Cir. 1994)

18 (“[T]he doctrine . . . should not be construed to permit the same corporation and its employees to

19 engage in civil rights violations.”); Novotny v. Great Am. Fed. Sav. & Loan Ass’n, 584 F.2d

20 1235, 1256–59 (3d Cir. 1978) (rejecting the doctrine), or do so while carving out exceptions, see

21 McAndrew, 206 F.3d at 1035–41 (carving out an exception for § 1985(2) because that subsection

22 involves criminal behavior); Benningfield, 157 F.3d at 378 (noting a “possible

23 exception . . . where corporate employees act for their own personal purposes”); Stathos v.

24 Bowden, 728 F.2d 15, 20–21 (1st Cir. 1984) (refusing to apply doctrine to a conspiracy that

25 “went beyond ‘a single act’ of discrimination” and expressing skepticism about the doctrine in

26 general). These courts question whether a doctrine originally based in anti-trust law is

1 compatible with § 1985’s purpose. See Brever, 40 F.3d at 1126–27; Stathos, 728 F.2d at 21

2 (Breyer, J.) (“Where ‘equal protection’ is at issue . . . one cannot readily distinguish in terms of

3 harm between the individual conduct of one enterprise and the joint conduct of several.”). They

4 also doubt the wisdom of immunizing actors from liability for behavior that is unconstitutional

5 and, in some circumstances, even criminal. See McAndrew, 206 F.3d at 1035–41; Brever, 40

6 F.3d at 1129.

7 While courts offer differing reasons for applying or refusing to apply the intra-corporate

8 conspiracy doctrine to § 1985, few—if any—justify their decision by discussing the Supreme

9 Court’s framework for interpreting the 1871 Civil Rights Act. But see Novotny, 584 F.2d at

10 1256–59 (declining to apply the doctrine because of § 1985’s text, the statute’s purpose, and the

11 history of conspiracy law). Under that framework, “the starting point . . . must be the language of

12 the statute itself.” Owen v. City of Indep., 445 U.S. 622, 636 (1980); see Griffin v. Breckenridge,

13 403 U.S. 88, 97 (1971) (quoting United States v. Price, 383 U.S. 787 (1966) (“The approach of

14 this Court to other Reconstruction civil rights statutes . . . has been to ‘accord (them) a sweep as

15 broad as (their) language.’”). The next step is to consider the common law as it existed in 1871,

16 which is instructive for two reasons. See id. at 636. First, it can help reveal the meaning of terms

17 that Congress used in 1871. See Monell, 436 U.S. at 687 (looking to common law to help define

18 the term “persons” in § 1983). Second, it sometimes contains “firmly rooted” immunities that the

19 Supreme Court is willing to apply despite their absence from the statutory text. See Owen, 445

20 U.S. at 636. Finally, one must look to see whether any interpretation or potential immunity is

21 consistent with the statute’s purpose. See id. (quoting Pierson v. Ray, 386 U.S. 547, 555 (1967))

22 (refusing to apply common law immunities unless they are “supported by such strong policy

23 reasons that ‘Congress would have specifically so provided had it wished to abolish the

24 doctrine’”).

25 When applied to § 1985(3), this framework compels the conclusion that agents acting on

26 a municipal corporation’s behalf are liable if they conspire to violate a person’s constitutional

1 rights.

2 The Plain Meaning of § 1985(3)

3 The text of § 1985(3) strongly suggests that agents acting on a municipal corporation’s

4 behalf are liable if they conspire to violate a person’s constitutional rights. Section 1985(3)

5 states,

6 If two or more persons . . . conspire . . . for the purpose of depriving, either directly

or indirectly, any person or class of persons of the equal protection of the laws, or

7 of equal privileges and immunities under the laws . . . the party so injured or

deprived may have an action for the recovery of damages occasioned by such injury

8

or deprivation, against any one or more of the conspirators.

9 42 U.S.C. § 1985(3) (emphasis added). Like § 1983, this language is “absolute and unqualified.”

10 Owen, 445 U.S. at 635. It makes “no mention . . . of any privileges, immunities, or defenses that

11 may be asserted.” Id. And it does not carve out immunity for any types of conspirators, such as

12 intra-corporate conspirators. Moreover, intra-corporate conspirators fall within the statute’s plain

13 meaning. See Novotny, 584 F.2d at 1257. Dictionaries at the time defined “conspire” as “to plot;

14 contrive;”6 “to concert a crime; to plot;”7 and “[t]o unite for an evil purpose.”8 Evidently, two

15 persons may “plot,” “contrive,” or “unite for an evil purpose” even if they happen to be agents of

16 the same municipal corporation.

17 The Common Law of Conspiracy

18 Although § 1985(3)’s language appears to reach intra-corporate conspiracies, the plain

19 meaning of “conspire” is not dispositive. After all, it is possible that Congress intended for

20 “conspire” to have a technical meaning that would exclude intra-corporate conspiracies. To

21

6 Joseph E. Worcester, A Dictionary of the English Language 300 (1860).

22

7 1 Samuel Johnson, A Dictionary of the English Language, in Which the Words Are Deducted

23 from Their Originals, and Illustrated in Their Different Significations by Examples from the Best

Writers. To Which are Prefixed, a History of the Language and an English Grammar 391 (1832).

24

8 William G. Webster & William A. Wheeler, A Common-school Dictionary of the English

25 Language, Explanatory, Pronouncing, and Synonymous: With an Appendix Containing Various

Useful Tables: Mainly Abridged from the Latest Edition of the American Dictionary of Noah

26

Webster 84 (1867).

1 determine if Congress intended to give “conspire” a technical meaning, the Court must look to

2 the common law in 1871. See Monell, 436 U.S. at 687.

3 When Congress enacted § 1985(3), the intra-corporate conspiracy doctrine was not

4 “firmly established.” In fact, several courts allowed criminal charges to be brought against

5 individual employees who committed crimes on behalf of corporations. See State v. Great Works

6 Milling & Mfg. Co., 20 Me. 41, 44 (1841) (“[W]hen a crime or misdemeanor is committed under

7 color of corporate authority, the individuals acting in the business, and not the corporation should

8 be indicted.”); State v. Patton, 26 N.C. (4 Ired.) 16, 17 (1843). Similarly, courts also held that

9 corporate employees could be liable for conspiracy even if the conspirators worked for the same

10 corporation. See Novotny, 584 F.2d at 1257 (“It is well-settled that an employer can conspire

11 with his employee.”); Ochs v. People, 16 N.E. 662, 670 (Ill. 1888); Page v. Cushing, 38 Me. 523,

12 527 (1854); State v. Donaldson, 32 N.J.L. 151, 156 (N.J. Super. Ct. 1867); State v. Powell, 63

13 N.Y. 88, 92 (1875). These cases led one commentator to observe that corporate employees are

14 often indictable for wrongs committed on a corporation’s behalf. 1 Joel Prentiss Bishop,

15 Commentaries on the Criminal Law § 424 (5th ed. 1872).

16 Despite this common-law history of courts holding corporate employees liable for

17 conspiracy, at least one circuit court relied on history when applying the intra-corporate

18 conspiracy doctrine to § 1985. In Travis v. Gary Community Mental Health Center, Inc., 921

19 F.2d 108, 110 (7th Cir. 1990), Judge Easterbrook asserted, “[w]hen Congress drafted § 1985 it

20 was understood that corporate employees acting to pursue the business of the firm could not be

21 treated as conspirators.” To justify his assertion, Judge Easterbrook pointed to the long-

22 established principle that a corporation and its managers are “considered as one person in law.”

23 Id. (quoting 1 William Blackstone, Commentaries on the Laws of England *456 (1st ed. 1765)).

24 While this “single-entity” principle was well-established in 1871, the principle does not

25 inevitably excuse corporate employees from liability for intra-corporate conspiracies. Indeed,

26 such a result is counter-intuitive: the single-entity theory was developed to expand corporate

1 liability, not contract it. See United States v. Hartley, 678 F.2d 961, 970 (11th Cir. 1982) (“By

2 personifying a corporation, the entity was forced to answer for its negligent acts . . . . The fiction

3 was never intended to prohibit the imposition of criminal liability by allowing a corporation or

4 its agents to hide behind the identity of the other.”). Moreover, there is little evidence that the

5 “single-entity” theory was used in 1871 to immunize corporate employees who conspired with

6 one another. The evidence instead shows the opposite—that courts routinely held employees

7 liable when they conspired on a corporation’s behalf. See Ochs, 16 N.E at 670; Powell, 63 N.Y.

8 at 92; Donaldson, 32 N.J.L. at 156; Page, 38 Me. at 527.

9 Given that courts held corporate employees liable for intra-corporate conspiracies at

10 common law, the Court declines to give the term “conspire” in § 1985(3) a technical meaning.

11 Instead, the Court gives the term its ordinary meaning and holds that a municipal corporation’s

12 agents can “conspire” with one another.

13 The Purpose of § 1985(3)

14 The Court’s conclusion about the meaning of “conspire” is buttressed by § 1985(3)’s

15 purpose. Section 1985 was passed as part of the 1871 Civil Rights Act, Pub. L. No. 42-22, 17

16 Stat. 13. The Act took aim at the widespread violations of black Americans’ civil rights in the

17 South, and its strategy for doing so was multifaceted. See Owen, 445 U.S. at 635–36; Monell 436

18 U.S. at 665. Through § 1983, the Act sought to deter civil rights violations by individuals acting

19 “under color of law.” See Monell, 436 U.S. at 685–87. Through § 1985(3), the Act sought to

20 specifically address the “group danger” posed by those who conspire with others to thwart the

21 Constitution’s promise of equal protection and equal rights. See Brever, 40 F.3d at 1127. As

22 Representative Samuel Shellabarger, the sponsor of the bill in the House, explained, “[t]he whole

23 design and scope of [§ 1985(3)] was to do this: to provide for the punishment of any combination

24 or conspiracy to deprive a citizen of the United States of such rights and immunities as he has by

25 virtue of the laws of the United States.” Cong. Globe, 42d Cong., 1st Sess. 382 (April 1, 1871)

26 (emphasis added).

1 Applying the intra-corporate conspiracy doctrine to § 1985(3) would undermine the

2 statute’s ability to protect people’s constitutional rights. The statute functions by deterring people

3 from pooling their resources and thereby magnifying their ability to violate people’s rights. And

4 it applies, as no one contests, to inter-corporate and non-corporate conspiracies. But “[w]here

5 ‘equal protection is at issue . . . one cannot readily distinguish in terms of harm between the

6 individual conduct of one enterprise and the joint conduct of several.” Stathos, 728 F.2d at 21;

7 see also Rebel Van Lines, 663 F. Supp. at 792. If anything, intra-corporate conspiracies—say, of

8 multiple police officers or multiple prosecutors—are likely more common and more harmful

9 given the ease with which employees in the same entity can conspire with one another to

10 discriminate. Thus, “to apply the intra-corporate conspiracy exception to public entities and

11 officials would immunize official policies of discrimination.” See Rebel Van Lines, 663 F. Supp.

12 at 792.

13 Similar policy concerns have led courts across the country to refuse to apply the intra-

14 corporate conspiracy doctrine to criminal laws. See United States v. Hughes Aircraft Co., 20 F.3d

15 974, 979 (9th Cir. 1994); Geoff Lundeen Carter, Agreements Within Government Entities and

16 Conspiracies Under § 1985(3)—A New Exception to the Intracorporate Conspiracy Doctrine?,

17 63 U. Chi. L. Rev. 1139, 1160 (1996) (“Courts today uniformly reject the intracorproate

18 conspiracy doctrine in criminal conspiracy cases.”). These cases show that “conspire” does not

19 have a single, fixed meaning. Sometimes, a corporation’s employees can conspire with one

20 another. See Hughes Aircraft Co., 20 F.3d at 979. Other times, they cannot. See Copperweld, 467

21 U.S. at 777. But in this case, what matters is that agents acting on behalf of a municipal

22 corporation can conspire within the meaning of § 1985(3). To hold otherwise would distort the

23 plain meaning of § 1985(3) and undermine the purpose that Congress intended the statute to

24 serve. Accordingly, the Court DENIES Defendants’ motion to dismiss Plaintiff’s § 1985(3)

25 claim to the extent that it asserts a valid claim against Drs. O’Callaghan, Lee, and Geise.

26

1 III. CONCLUSION

2 For the foregoing reasons, the Court GRANTS in part and DENIES in part Defendants’

3 motion for partial dismissal (Dkt. No. 32).

4 DATED this 18th day of October 2019.

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John C. Coughenour

8 UNITED STATES DISTRICT JUDGE

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