Jay Barrash v. Amer Assn of Neurl Surgns Inc.

Case: 14-20764 Document: 00513370304 Page: 1 Date Filed: 02/04/2016

REVISED February 3, 2016

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

United States Court of Appeals

Fifth Circuit

No. 14-20764 FILED

January 29, 2016

JAY MARTIN BARRASH, M.D.,

Lyle W. Cayce

Clerk

Plaintiff - Appellant

v.

AMERICAN ASSOCIATION OF NEUROLOGICAL SURGEONS,

INCORPORATED,

Defendant - Appellee

Appeal from the United States District Court

for the Southern District of Texas

Before STEWART, Chief Judge, and CLEMENT and ELROD, Circuit Judges.

EDITH BROWN CLEMENT, Circuit Judge:

Dr. Jay Martin Barrash is a neurosurgeon and former member of the

American Association of Neurological Surgeons (“AANS”) who regularly

testified as an expert witness in legal proceedings. Dr. Barrash provided

deposition testimony against Dr. Oishi, a fellow AANS member, in a medical

malpractice case. Dr. Barrash testified, among other things, that Dr. Oishi (1)

incorrectly placed a bone graft during the patient’s surgery and (2) failed to

adequately treat a post-operative infection, causing the patient to suffer

additional surgical procedures and leading to chronic pain and depression. Dr.

Oishi settled with the plaintiff and then filed a complaint against Dr. Barrash

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using the AANS’s internal grievance process. The complaint alleged the

following violations of the AANS Rules for Neurosurgical Medical/Legal Expert

Opinion Services: that Dr. Barrash failed to provide impartial testimony; that

Dr. Barrash failed to review all pertinent available medical information; that

Dr. Barrash failed to allow for differing medical opinions; that Dr. Barrash

lacked the training and experience necessary to testify; and that Dr. Barrash

charged excessive expert witness fees.

The AANS’s Professional Conduct Committee (“PCC”) held a hearing for

the complaint. Dr. Barrash attended with his attorney and presented a

defense. The PCC concluded that (1) Dr. Barrash’s criticism of Dr. Oishi’s

failure to render adequate post-operative care was appropriate, but also that

Dr. Barrash (2) failed to review all of the pertinent and available medical

records prior to testifying—specifically, an intraoperative x-ray showing the

initial bone graft placement—and (3) failed to provide unbiased testimony. The

PCC recommended that Dr. Barrash’s AANS membership be suspended for six

months.

Dr. Barrash appealed to the AANS Board of Directors (the “Board”), and

the Board downgraded the suspension to a censure. Dr. Barrash then exercised

his right to appeal to the AANS members at-large, providing a written

statement for consideration at the annual meeting. The members voted to

uphold the censure, and the AANS published it as follows: “Dr. J. Martin

Barrash, following an appeal to the AANS general membership on April 11,

2011, has been censured for giving expert testimony without having seen the

imaging studies relevant to that testimony, and for failure to provide unbiased

testimony during part of a deposition in a civil lawsuit.” Dr. Barrash resigned

from the AANS and filed suit, claiming that the censure harmed his future

employment opportunities as an expert witness. Dr. Barrash sued the AANS

for (1) tortious interference with prospective business relations; (2) breach of

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contract (the AANS bylaws); and (3) impairment of an important economic

interest from denial of due process.

The district court dismissed the tortious interference and breach of

contract claims under Rule 12(b)(6). Both parties moved for summary

judgment on the remaining due process claim. The district court found that the

AANS failed to provide adequate notice on the charge of failing to provide

“unbiased testimony” 1 but met the requirements of due process on the charge

of “giving expert testimony without having seen the [relevant] imaging

studies.” The district court set aside the portion of the censure relating to

unbiased testimony but left the rest of the censure in place. Thus, the district

court granted the plaintiff’s motion in part, denied it in part, and granted the

defendant’s motion in part. Dr. Barrash appeals the district court’s adverse

summary judgment ruling and the 12(b)(6) dismissal of his breach of contract

claim. The AANS does not appeal the partial vacation of the censure.

I.

We review de novo a district court’s grant of summary judgment, and

summary judgment is appropriate “if the movant shows that there is no

genuine dispute as to any material fact and the movant is entitled to judgment

as a matter of law.” Rogers v. Bromac Title Servs., LLC, 755 F.3d 347, 350 (5th

Cir. 2014) (quoting Fed. R. Civ. P. 56(a)).

Because Dr. Barrash’s claims arise under Texas law, we look to how

Texas courts resolve similar claims. See Hatley v. Am. Quarter Horse Ass’n, 552

F.2d 646, 654–56 (5th Cir. 1977). The AANS is a voluntary professional

association. “Texas courts will not interfere with the internal management of

voluntary associations so long as the governing bodies of such associations do

1 The district court generally uses the phrase “improper advocacy,” a phrase the PCC

used in their report. But the censure uses the phrase “unbiased testimony.” For clarity and

consistency, we use the phrase “unbiased testimony” here.

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not substitute legislation for interpretation and do not overstep the bounds of

reason or violate public policy or the laws of [Texas] while doing so.” Burge v.

Am. Quarter Horse Ass’n, 782 S.W.2d 353, 355 (Tex. App.—Amarillo 1990, no

writ). “If the courts were to interfere every time some member, or group of

members, had a grievance, real or imagined, the non-profit, private

organization would be fraught with frustration at every turn and would

founder in the waters of impotence and debility.” Juarez v. Texas Ass’n of

Sporting Officials El Paso Chapter, 172 S.W.3d 274, 280 (Tex. App.—El Paso

2005, no pet.). Under this doctrine of judicial non-intervention, a Texas court

will conduct judicial review of a voluntary association’s internal operations

“only when the actions of the organization are illegal, against some public

policy, or are arbitrary or capricious.” Dallas Cty. Med. Soc’y v. Ubiñas-Brache,

68 S.W.3d 31, 41 (Tex. App.—Dallas 2001, pet. denied) (citations omitted).

As a result, both Texas courts and this court (when adjudicating Texas

law claims) have recognized due process challenges as a limited grounds for

judicial intervention in the internal affairs of a private organization. See

Stevens v. Anatolian Shepherd Dog Club of Am., Inc., 231 S.W.3d 71, 75, 76 n.1

(Tex. App.—Houston 2007, pet. denied); Hatley, 552 F.2d at 656–57. In this

context, “[t]he essential elements of due process . . . are notice and an

opportunity to be heard and to defend in an orderly proceeding adapted to the

nature of the case.” Adams v. Am. Quarter Horse Ass’n, 583 S.W.2d 828, 834

(Tex. Civ. App.—Amarillo 1979, writ ref’d n.r.e.). Dr. Barrash raises a due

process challenge to the portion of the censure relating to his failure to review

all pertinent and available records. First, Dr. Barrash argues that the PCC

failed to provide him with critical evidence before the hearing, thereby denying

him fair notice; second, Dr. Barrash argues that the district court’s partial

vacation of the censure requires that the entire censure be vacated.

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a. Notice Challenge

“The term ‘due process of law’ is synonymous with ‘the law of the land,’

and its essential elements are notice, and an opportunity to be heard and to

defend in an orderly proceeding adapted to the nature of the case.” Masonic

Grand Chapter of Order of E. Star v. Sweatt, 329 S.W.2d 334, 337 (Tex. Civ.

App.—Fort Worth 1959, writ ref’d n.r.e.). Here, Dr. Barrash received his initial

notice through a charging letter submitted by Dr. Oishi. The letter alleged that

Dr. Barrash testified “without having reviewed the intraoperative X-rays that

clearly demonstrate[d] proper hardware and bone graft placement,” in

violation of clause B.2 of the Rules for Neurosurgical Medical/Legal Expert

Opinion Services. 2 The PCC scheduled a hearing several months later, and Dr.

Barrash appeared at the hearing with counsel and presented a defense. Dr.

Barrash claims that the PCC failed to provide him with a copy of the

intraoperative x-ray films before the hearing, denying him fair notice.

Some weeks prior to the hearing, however, the AANS notified Dr.

Barrash that it possessed the x-ray films, and that the films and a viewing box

would be present at the hearing. Dr. Barrash never requested advance copies

of the films or an opportunity to review them. Dr. Barrash now claims that the

AANS’s failure to provide him with an advance copy of the “smoking gun”

evidence violates due process. Dr. Barrash was fully aware that the x-rays

would play a central role at the hearing, yet he made no effort to review them

in advance, despite having weeks to do so. Furthermore, Dr. Barrash’s due

process argument that the failure to provide an advance copy of the x-ray

violated the AANS’s internal bylaws governing disciplinary proceedings

assumes that those bylaws inform our due process inquiry; they do not. Due

2 Clause B.2 states: “The neurosurgical expert witness shall review all pertinent

available medical information about a particular patient prior to rendering an opinion about

the appropriateness of medical or surgical management of that patient.”

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process in this context is satisfied by notice and a hearing even when an

organization’s bylaws require more. See Whitmire v. Nat’l Cutting Horse Ass’n,

No. 2-08-176-CV, 2009 WL 2196126, at *5 (Tex. App.—Fort Worth July 23,

2009, pet. denied) (rejecting due process challenge because “[the plaintiff’s]

complaints address the technical aspects of the [organization’s] application of

its rules to her, but do not allege a wholesale deprivation of due process or the

opportunity to be heard”). As a result, we find no due process violation on the

issue of fair notice. 3

b. Partial Vacation of Censure

The district court found that the AANS did not provide sufficient due

process in adjudicating the charge of failing to provide unbiased testimony. 4

The district court ordered the AANS to expunge that portion of the censure but

allowed the rest of the censure to remain, despite stating that “[i]t is

unknown—perhaps unknowable—how the PCC would have proceeded had it

only the violation of Rule B2 in mind when it issued its disciplinary

recommendation to the AANS Board of Directors.” Dr. Barrash argues that

because the district court set aside one of the two bases for the censure, it

should have set aside the whole censure, because there is no way to determine

whether the censure would have occurred at all absent both bases.

This is an issue of first impression. We are not aware of any case where

a court found only a partial due process violation, resulting in only a partial

vacation of an association’s adverse action. Cf. Hatley, 552 F.2d at 657

3 Dr. Barrash also seeks to challenge, on appeal, the substantive findings of the PCC,

arguing that the x-ray was neither pertinent nor available when he testified. The PCC—and

by extension, the AANS—ruled that the x-ray was pertinent and that Dr. Barrash should not

have testified without reviewing it. Rather than raising a genuine due process challenge, Dr.

Barrash simply disagrees with the substantive judgment of the PCC and asks this court to

substitute its own judgment in the field of neurology. We decline to do so.

4 In short, the district court found that the charges failed to provide Dr. Barrash with

sufficient notice of the nature and identity of the alleged unbiased testimony.

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(association’s decision to refuse to register a horse without a hearing violated

due process); Sweatt, 329 S.W.2d 334 (association’s expulsion of member

without providing an adequate opportunity to prepare a defense violated due

process). We nonetheless conclude that the district court ruled correctly.

Because Dr. Barrash received due process on the charge of failing to review all

pertinent and available records prior to testifying, any further review of the

AANS’s subsequent censure of that misconduct is precluded by the Texas

doctrine of judicial non-intervention.

Furthermore, we find it unnecessary to debate whether the Board and

the members at-large would have censured Dr. Barrash absent both charges. 5

The critical question is whether Dr. Barrash was afforded due process, not

whether a single rule violation merits something less than a censure under the

AANS’s disciplinary system. Given that the AANS substantiated the charge of

“failure to review” after a lengthy hearing, we find that the choice of a censure

versus a lesser alternative is a matter of degree, not fundamental fairness.

Finally, while the district court ordered only a partial vacation of the censure,

the AANS certainly could have vacated the entire censure had it deemed such

action appropriate. Its decision to leave the remaining portion of the censure

in place is, in and of itself, an internal management decision entitled to judicial

deference—one which Dr. Barrash could have possibly challenged within the

organization had he not resigned his membership shortly after being censured.

Because the AANS provided adequate due process on the charge of failing to

review all pertinent and available records before publication, the district court

did not err by leaving this part of the censure undisturbed.

5 We consequently do not adopt the district court’s rationale for its ruling—that Dr.

Barrash bore the burden of proof to show “how the PCC would have proceeded had it only the

violation of Rule B2 in mind when it issued its disciplinary recommendation,” and that his

claim fails because “the record is simply not clear, either way” on that issue.

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II.

We review de novo a district court’s grant of a motion to dismiss for

failure to state a claim under Rule 12(b)(6). Leal v. McHugh, 731 F.3d 405, 410

(5th Cir. 2013). “Dismissal is appropriate only if the complaint fails to plead

‘enough facts to state a claim to relief that is plausible on its face.’’’ Id. (quoting

Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)).

Dr. Barrash claims that because he was a member of the AANS, the

association’s bylaws formed a contract between them. The bylaws include the

disciplinary procedures to be followed by the PCC. Dr. Barrash argues that the

AANS breached the bylaws when it censured him because the PCC did not

strictly comply with its own procedures. He claims that this breach caused

damages because he lost income opportunities as an expert witness following

publication of the censure.

To date, no Texas court has allowed a plaintiff to challenge a professional

organization’s internal disciplinary procedures under a breach of contract

theory. See Whitmire, 2009 WL 2196126 at *5–6 (rejecting a breach of contract

claim where the plaintiff’s complaint “address[ed] the technical aspect of the

[association’s] application of its rules” but did not allege “a wholesale

deprivation of due process or the opportunity to be heard in violation of some

civil or property right”); Ubiñas-Brache, 68 S.W.3d at 42 (noting that “a breach

of contract action to maintain membership in a private association is not a

well-recognized or well-defined common law action in [Texas]”); see also Bryan

v. Jones, No. 2:05-CV-109, 2005 WL 1189882, at *3 (E.D. Tex. May 19, 2005)

(citing Ubiñas-Brache and dismissing plaintiff’s bylaws-based breach of

contract claim under Rule 12(b)(6)).

Based on Texas precedent and the doctrine of judicial non-intervention,

we find that Dr. Barrash has failed to state a plausible breach of contract claim.

Dr. Barrash’s breach of contract claim is little more than a disagreement with

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the disciplinary decision of the AANS, and it is therefore precluded by the

doctrine of non-intervention.

III.

Dr. Barrash received sufficient due process, including notice, a hearing,

and multiple levels of appeal, before he was censured for failing to review all

pertinent and available records prior to testifying. Because the district court

found only one basis of the censure to be unsupported by due process, the

district court was correct in setting aside only that portion of the censure.

Furthermore, no Texas court has recognized a breach of contract challenge to

a private association’s disciplinary process. Dr. Barrash thus failed to state a

plausible breach of contract claim on which relief could be granted, and the

district court properly dismissed. AFFIRMED.

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