Ascherman v. Presbyterian Hospital of Pacific Medical Center, Inc.

DUNIWAY, Circuit Judge

(concurring):

I concur, but add some observations of my own.

Presbyterian Hospital is “private.” It is not owned or operated by the State of California or any of its political subdivisions. No agency of the state selects or is represented on its governing board. Thus several of the cases in which the receipt of Hill-Burton funds or the grant by the state of tax exemption, or both, are mentioned are not in point. See, e. g.: O’Neill v. Grayson County War Memorial Hospital, 6 Cir., 1973, 472 F.2d 1140, 1142-1143 ;. Chiaffitelli v. Dettmer Hospital, Inc., 6 Cir., 1971, 437 F.2d 429 ; Sosa v. Board of Managers of Val Verde Memorial Hospital, 5 Cir., 1971, 437 F.2d 173, 174 ; Foster v. Mobile County Hospital Board, 5 Cir., 1968, 398 F.2d 227, 230 ; Meredith v. Allen County War Memorial Hospital Commission, 6 Cir., 1968, 397 F.2d 33, 35 .

Appellant has not shown that there is any California statute or regulation dealing with the procedure or qualifications for staffing the Presbyterian Hospital with doctors. All that is shown is that the hospital’s receipt of substantial Hill-Burton funds does subject certain of its operations to regulation by the state, and that it is exempt from state taxes. Presumably, although we need not so decide, if the hospital took some action under applicable state regulations that action would be “state action.” Our question, then, is narrow: whether other actions by the hospital, not regulated by the state, are “state action” merely because the hospital has received Hill-Burton funds, is tax exempt, and is partially regulated by the state. The answer to this question is “no.”

There are many “private” charitable organizations that receive subventions of various kinds from the state or its political subdivisions. I think that it would be most unfortunate to adopt a rule that receipt of such subventions automatically *1106 transforms everything that these organizations do into “state action.” The proposition could produce startling results. For example, if a private tax exempt university received state moneys to build and used them to build a library, would that mean that the librarian’s action in ejecting a noisy student from that library is “state action”? I cannot believe that the state action notion goes so far.

The weight of authority supports our holding that state action is not involved here. The following cases are directly in point: Jackson v. Norton-Children’s Hospitals, Inc., 6 Cir., 1973, 487 F.2d 502 ; Ward v. St. Anthony Hospital, 10 Cir., 1973, 476 F.2d 671, 675 . These cases involve staff privileges of doctors. Also in point are Place v. Shepherd, 6 Cir., 1971, 446 F.2d 1239, 1245 , involving a nurse, and Doe v. Bellin Memorial Hospital, 7 Cir., 1973, 479 F.2d 756, 761 , involving a hospital rule about abortions.

Closely in point are cases dealing with other private charitable tax exempt corporations: Blackburn v. Fisk University, 6 Cir., 1971, 443 F.2d 121 ; Powe v. Miles, 2 Cir., 1968, 407 F.2d 73, 81 ; Bright v. Isenbarger, 7 Cir., 1971, 445 F.2d 412 ; Browns v. Mitchell, 10 Cir., 1969, 409 F.2d 593, 595-596 . What I believe to be the correct rule is stated by Judge Friendly in Powe v. Miles, supra, 407 F.2d at 81 : “[T]he state must be involved not simply with some activity of the institution . . . but with the activity that caused the injury.” No such involvement is shown here.

Appellant relies primarily upon a line of decisions of the Fourth Circuit, some of which, in my view, go too far in finding “state action” by a hospital because of its receipt of Hill-Burton funds. The leading case, Simkins v. Moses H. Cone Memorial Hospital, 4 Cir., 1963, 323 F.2d 959 , is readily distinguishable because there the state, in applying for the funds, took advantage of a “separate but equal” provision of the Hill-Burton Act. As a result, the hospitals receiving the funds discriminated against blacks. Eaton v. Grubbs, 4 Cir., 1964, 329 F.2d 710 ; and Smith v. Hampton Training School for Nurses, 4 Cir., 1966, 360 F.2d 577 , also involved racial discrimination. I think it fair to say that federal courts, rightly or wrongly, are more likely to find state action where race discrimination is involved than in due process types of cases, like the case at bar. However, the Fourth Circuit has gone much further, and has found, in substance, that acceptance of Hill-Burton funds has transmogrified the accepting hospital in all of its operations into a public institution. Sams v. Ohio Valley General Hospital Ass’n, 4 Cir., 1969, 413 F.2d 826 ; Christhilf v. Annapolis Emergency Hospital, Inc., 4 Cir., 1974, 496 F.2d 174 . These cases, I think, are wrong, and we are not following them here.