Opposition Brief — Willis v. University Health Services, Inc.

No. 93-440 i Enorema Court,

am A Ss

U8,

D

In The | OCT 21

Supreme Court of the United States |

‘>

October Term, 1993

CAROL H. WILLIS,

Petitioner,

vs.

UNIVERSITY HEALTH SERVICES, INC., d/b/a

UNIVERSITY HOSPITAL; SHERRY HICKS, individually

and in her official capacity as Head Nurse of Postpartum for

University Hospital, MARY LYNN GOFORTH, individually

and in her official capacity as Director of Maternal/Child

Nursing for University Hospital; MARILYN BOWCUTT,

individually and in her official capacity as Assistant

Administrator of Nursing Services for University Hospital;

and JOSEPH W. HERZBERG, individually and in his official

capacity as Director of Personnel Services for University

Hospital,

Respondents.

On Petition for a Writ of Certiorari to the United States Court

of Appeals for the Eleventh Circuit

“RESPONDENTS’ BRIEF IN OPPOSITION c

RAYMOND G. CHADWICK, JR.

Counsel of Record

GARY J. TOMAN

R. PERRY SENTELL, III

KNOX & ZACKS

Attorneys for Respondents

P.O. Box 2043

Augusta, Georgia 30903

(706) 724-2622

M agelst (800) 3 APPEAL * (800) 5 APPEAL * (800) BRIEF 21 WV

he ne ens

TABLE OF CONTENTS

Page

NT GE 5k we ne ack ene dane cv esesanes l

Reasons for Denyingthe Writ ...... 6. cccececccseces 5

I. The Eleventh Circuit properly applied all of the

State action tests which have been previously

POCORN OY GB CIOE, boc 66s os ccccteesanes 5

II. The District Court and the Eleventh Circuit

properly considered ail of the particular facts of

this case and found state action to be lacking. .... 8

ENED csc oan ac even ereeees ac una sear acne ees 12

TABLE OF CITATIONS

Cases Cited:

Adickes v. §.H. Kress & Co., 398 U.S. 144(1970) ....... 6

Blum v. Yaretsky, 457 U.S.991 (1982) ................ 6,8

Burton v. Wilmington Parking Authority, 365 U.S. 715

PR ere aes sc sa eer ee ta aaa eae 6,7,8, 10, 11

Carol H. Willis v. University Health Services, Inc., d/b/a

University Hospital, et al., 993 F.2d 837 (11th Cir.

Se ee ee ees a eee ae ec es 5

Crowder v. Conlan, 740 F.2d 447 (6th Cir. 1984) ....... 10

Flag Bros., Inc. v. Brooks, 436 U.S. 149 (1978) ......... a

il

Contents

Page

Greco v. Orange Memorial Hospital, 513 F.2d 873 (Sth

Cir.), cert. denied, 423 U.S. 1000(1975) ........... 10, 11

Jackson v. Metropolitan Edison Company, 419 U.S. 345

4) er ers pret fo = Pale 6,8

Jatoi v. Hurst-Euless-Bedford Hospital Authority, 807 F.2d

1214 (Sth Cir.), modified on other grounds, 819 F.2d 545

bo le A ys rrr Ere rn re eh ey: 10

Milo v. Cushing Memorial Hospital, 861 F.2d 1194 (10th

Ge) TOO ck oc na ee Oa es ee eee eee 10

Moose Lodge No. 107 v. Irvis, 407 U.S. 163 (1972) ...... 6

NBC v. Communications Workers of America, 860 F.2d

eae SIG. TSNO) oe oc ivasesee ssae¥eo eee 6,7, 11

Rendell-Baker v. Kohn, 457 U.S. 830 (1982) .......... 6,8

Richmond County Hospital Authority v. Richmond County,

295 Ga. 193, S5OS.Z. ZO SCZ (ISES) & occcccctvceevs 5

San Francisco Arts & Athletics, Inc. v. U.S. Olympic

Committee, 493 U5. 328 «os 3 soc aseeeeeeeee 6,7,8, 11

Statute Cited:

OE Ue BEES ko ote dee ceenesen eee io

ll

Contents

Page

United States Constitution Cited:

l

Neen Tee Tn ee eee eeeeuses

—"

FourteenthAmendment .................eeeeceeees

!

]

STATEMENT OF THE CASE

Petitioner Carol Willis filed this action against defendant

University Health Services, Inc., a private, non-profit corporation,

as well as four (4) employees, both in their individual and official

capacities (hereinafter “respondents”) on December 28, 1990 in

the United States District Court for the Southern District of

Georgia. Petitioner brought this lawsuit pursuant to 42 U.S.C.

§ 1983, alleging that respondents’ decision to terminate her

employment violated her rights under the First and Fourteenth

Amendments to the United States Constitution.

On August 8, 1991, respondents filed a motion for summary

judgment on the grounds that Willis failed to establish that she had

been deprived of a federally protected right “under color of state

law” as required by 42 U.S.C. § 1983 and on the alternate grounds

that Willis cannot establish any violation of her federally protected

rights. The District Court heard oral arguments on the motion for

summary judgment, and on July 27, 1992, entered an order

granting UHS’s motion holding that petitioner failed to establish

state action since the state had not played any role in the decision to

terminate her employment. The District Court did not reach the

First and Fourteenth Amendment issues contained in UHS’s

motion for summary judgment. The District Court entered

judgment in favor of all defendants on July 28, 1992. Petitioner

filed her notice of appeal on August 3, 1992. The Eleventh Circuit

affirmed the District Court by opinion, dated June 22, 1993, which

holds that the petitioner failed to establish state action under any of

the three tests previously recognized by this Court.

Respondent UHS employed petitioner as a registered nurse at

University Hospital in Augusta, Georgia from December 1987

until January 2, 1990. The respondents’ decision to terminate

petitioner’s employment was based on a loss of confidence due to

poor judgment as exhibited by several incidents of conflict

tN

between petitioner’s practices and hospital policies. '

The petition is conspicuously void of the numerous facts

existing in this case which were critical to the Eleventh Circuit’s

state action analysis. In 1984, respondent UHS was organized for

the primary purpose of managing and operating University

Hospital. The intended purpose of the restructuring was to enable

the hospital to become more competitive in the marketplace by

placing the operation of the hospital in the hands of a private, non-

governmental entity which would allow the hospital to expand its

operations outside of Richmond County.

Respondent UHS shares a common parent corporation, named

University Health, Inc., with two other affiliated corporations

named University Extended Services, Inc. and University Health

Resources, Inc. The affiliated corporation named University

Health Resources, Inc. is a for profit corporation which provides

1. The Eleventh Circuit's opinion is attached as Appendix A to the petition

and its statement of the facts is a far more accurate account than that set forth in

the petition. In addition to the newspaper editorial, quoted in the Eleventh

Circuit’s opinion, there were at least four other incidents where petitioner's

conduct was contrary to hospital policies. This included one situation where a

former student of petitioner's Bradley Natural Childbirth Classes, named June

Edwards, advised hospital personnel of numerous statements which she

contended were made by petitioner, that caused respondents great concern. Mrs.

Edwards was a high risk pregnancy patient, and during these classes, petitioner

allegedly gave her advice which could have been life-threatening, such as the

following: to wait until her contractions were sixty seconds apart for at least two

hours to decrease the likelihood of a C-section; that certain obstetricians were

not informed regarding natural childbirth and did not know what was best for

their patients; that Vs and monitors were not necessary and that students should

stay at home as long as possible since the worst thing that could happen would be

ahome delivery.

Since the District Court's decision and the appeal turn on other facts,

respondents have chosen not to discuss these incidents in greater detail.

contract laundry services as well as an answering service for

physicians. The affiliated corporation named University Extended

Services, Inc. has constructed and now operates two nursing

homes.

In addition to operating the hospital, respondent UHS has also

entered into a joint venture with St. Joseph, another local hospital,

to develop Walton Rehabilitation Hospital and a life care

community called Brandon Wilde. The two nursing homes, the life

care COmmunity center and the laundry service were all

constructed after UHS assumed the operations of University

Hospital.

Respondent UHS, a private, non-profit corporation, operates

University Hospital and its related facilities through a lease

agreement executed between UHS and the Richmond County

Hospital Authority (“RCHA”), on December 14, 1984. Pursuant to

this lease agreement, UHS was given sole discretion to hire,

terminate, promote or assign employees and to hire agents and

independent contractors. The lease agreement also gives UHS

broad authority to determine hospital operations and services in

compliance with the goal of benefiting the public health needs of

the community. Paragraph 12 of the lease clearly sets forth the

relationship between RCHA, UHS and the employees of UHS and

States, in pertinent part, the following:

UHS shall have the discretion to hire,

terminate, promote or assign employees and to

hire agents or independent contractors. UHS

shall also have the discretion to determine and

to adjust salaries and employee benefits.

As Mr. Bray, the President of respondent UHS, has stated in his

affidavit,

4

No director, officer, agent or employee of

RCHA, while working in such capacity, had

any right whatsoever to exercise any control

over the employment or termination of Carol

H. Willis. Furthermore, no director, officer,

agent or employee of RCHA, while acting in

such capacity, exercised or attempted to

exercise control or discretion over the

employment or termination of Carol H. Willis.

In addition to giving respondent UHS the exclusive authority

to make personnel decisions, the lease also gives UHS exclusive

control over the management and operations of the hospital. VHS

was given the power to diminish, curtail or cease services when it

determined that such cessation will promote the public health

needs of the community. UHS is also authorized to “augment,

improve or increase any existing service, or add any service or shift

current or new services to another facility...” In addition,

respondent UHS has the authority to determine whether any

acquisition, construction, or improvement of hospital facilities is

necessary. UHS has “complete discretion” in deciding whether or

not to repair or replace any asset which may become worn,

inoperable or obsolete. The lease also authorizes respondent UHS

to obtain policies of insurance such as business interruption

insurance, which are payable solely to UHS. UHS has the authority

to promulgate and enforce its own rules and regulations regarding

safety, care and cleanliness of the leased premises.

UHS receives county funds to be used to offset operating costs

and therefore, must disclose financial information to RCHA in

connection with the hospital authority’s oversight responsibility.

However, UHS does not have a working relationship with RCHA

in terms of UHS’s operation of University Hospital. The quarterly

meetings and business of RCHA and UHS are conducted

separately through separate agendas.

5

Shortly after University Hospital’s restructuring, the highest

state court in Georgia was asked to analyze the relationship

between RCHA and respondent UHS. See Richmond County

Hospital Authority v. Richmond County, 255 Ga. 183, 336 S.E. 2d

562, 565 (1985). Applying Georgia’s alter ego law, the Georgia

Supreme Court held that RCHA and UHS are separate and distinct

entities. /d.

Based upon these facts, the Eleventh Circuit, on June 22,

1993, affirmed in all respects the District Court’s order granting

respondents’ motion for summary judgment. Carol H. Willis v.

University Health Services, Inc., d/b/a University Hospital, et al.,

993 F.2d 837 (11th Cir. 1993).? The petitioner did not file a petition

for reconsideration with the Eleventh Circuit, but instead filed her

petition to this Court.

REASONS FOR DENYING THE WRIT

I.

THE ELEVENTH CIRCUIT PROPERLY APPLIED

ALL OF THE STATE ACTION TESTS WHICH HAVE

BEEN PREVIOUSLY RECOGNIZED BY THIS COURT.

Under 42 U.S.C. § 1983, the civil rights plaintiff must

establish that the alleged violation of her federally protected rights

was committed under color of state law. See 42 U.S.C. § 1983.

Underscoring the primary focus of a federal court in determining

whether state action exists, this Court recently reaffirmed its prior

holdings and stated, “[m]ost fundamentally, this court has held that

a government ‘normally can be held responsible for a private

2. The facts of this case contradict the factual assumptions made by

petitioner in the first question presented to this Court and this question certainly

does not merit Supreme Court review.

-

6

decision only when it has exercised coercive power or has

provided such significant encouragement, either overt or covert,

that the choice must in law be deemed to be that of the

[government].’” San Francisco Arts & Athletics, Inc. v. U.S.

Olympic Committee, 483 U.S. 522, 546 (quoting Blum v. Yaretsky,

457 U.S. 991, 1004 (1982)) (citing Rendell-Baker v. Kohn, 457

U.S. 830, 840 (1982); Flag Bros., Inc. v. Brooks, 436 U.S. 149, 166

(1978); Jackson v. Metropolitan Edison Company, 419 U.S. 345,

357 (1974); Moose Lodge No. 107 v. Irvis, 407 U.S. 163, 173

(1972); Adickes v. S.H. Kress & Co., 398 U.S. 144, 170 (1970)).

Although the language cited above from the Blum Court spoke of

holding the state liable pursuant to the state action doctrine, the

standard remains the same when a party seeks to hold a private

actor liable under the state action doctrine. Indeed, in San

Francisco, this Court applied the Blum language to a civil rights

claim directed against the United States Olympic Committee, a

private corporation. San Francisco, 483 U.S. at 543.

This Court, as well as the Eleventh Circuit, has previously

recognized that there are three primary tests which apply in cases

where a party seeks to hold a private actor liable under the state

action doctrine: (1) the public function test; (2) the state

compulsion test; and (3) the nexus/joint action test. See San

Francisco, 483 U.S. 522; and NBC v. Communications Workers of

America, 860 F.2d 1022 (11th Cir. 1988). Through the second

question presented, petitioner argues that the Eleventh Circuit

below erred by refusing to apply a fourth test which she refers to as

the “symbiotic relationship” test announced in Burton vy.

Wilmington Parking Authority, 365 U.S. 715 (1961).

Petitioner maintains that the “symbiotic relationship” test is

separate and apart from the nexus/joint action test applied by the

Eleventh Circuit below. This argument is contrary to recent

Supreme Court and Eleventh Circuit case law. This authority

7

indicates that the nexus/joint action and symbiotic relationship

tests are one and the same. San Francisco, 483 U.S. at 547, n. 29;

and NBC, 860 F.2d at 1026, n. 5. Addressing this issue, the

Eleventh Circuit recently stated the following:

Lugar v. Edmondson Oil Co., Inc., 457 U.S.

922, 939, 102 S. Ct. 2744, 2754-55, 73 L. Ed.

2d 482 (1982) separated the nexus and joint

action tests, but a more recent Supreme Court

case has merged the two. See San Francisco, __

U.S. at__ n. 29, 107 S. Ct. at 2986 n. 29. See

also, Jackson, 419 U.S. at 357-58, 95 S. Ct. at

456-57.

NBC, 860 F.2d at 1026, n. 5.

Consistent with San Francisco, the opinion below clearly

indicates that the Eleventh Circuit applied the “symbiotic

relationship” analysis described in Burton to the facts of this case

in determining whether petitioner met the nexus/joint action test:

Hence, we only address whether Willis has

shown that UHS and RCHA are so intertwined

in a “symbiotic relationship” that they satisfy

the nexus/joint action § test, thereby

demonstrating the existence of state action.

(Petition, App. A, p. 13a). The Eleventh Circuit performed an

extensive factual analysis of the relationship between RCHA and

respondent UHS and held that petitioner failed to satisfy the nexus/

joint action test. (Petition, App. A, pp. 18a-19a). Petitioner’s

argument that the courts below failed to properly apply the correct

State action tests is w:thout merit.

The Eleventh Circuit also correctly held that petitioner failed

8

to meet the remaining two state action tests.’ First, petitioner could

not establish state action under the public function test since

respondents did not exercise powers traditionally reserved for the

state. (Petition, App. A, p. 13a). See also, Rendell-Baker, 457 U.S.

at 842; and Jackson v. Metropolitan Edison Co., 419 U.S. 345, 353

(1974). Secondly, petitioner did not satisfy the state compulsion

test since RCHA did not coerce or encourage respondents to

terminate petitioner’s employment. (Petition, App. A, p. 13a). See

also, San Francisco, 483 U.S. at 547; and Blum, 457 U.S. at 1004.

Accordingly, the Eleventh Circuit correctly applied all of the state

action tests established by the precedent case law of this Court.

II.

THE DISTRICT COURT AND THE ELEVENTH

CIRCUIT PROPERLY CONSIDERED ALL OF THE

PARTICULAR FACTS OF THIS CASE AND FOUND

STATE ACTION TO BE LACKING.

Petitioner is requesting that this Court re-examine the

particular facts of this case which have been thoroughly analyzed

by the two courts below. As stated in the Burton opinion, upon

which petitioner relies, “only by sifting facts and weighing

circumstances can the non-obvious involvement of the state in

private conduct be attributed its true significance.” Burton, 365

U.S. at 722. The court below applied the sifting factual analysis

required by Burton, but unlike Burton, found that state action was

lacking in this case.

3. Petitioner's questions presented numbers four and five clearly do not

merit review by this Court. An abundance of case law precedent from this Court

has definitively dealt with these issues. In fact, during oral argument before the

Eleventh Circuit, counsel for petitioner abandoned her arguments under these

two tests.

9

In particular, the Eleventh Circuit recognized that the

following facts demonstrate that UHS and RCHA are separate and

distinct entities serving different purposes: (1) UHS assumed

control of the hospital so that it could be competitive outside of

Richmond County; (2) University Health, inc. is the parent

corporation for UHS and other services; (3) UHS has entered into a

joint venture with the local hospital to develop other care facilities;

(4) UHS has broad discretion to diminish, curtail or cease services

to promote the public health needs of the community; (5) UHS is

authorized to “augment, improve or increase any existing services

or add any service or shift current or new services to another

facility”; (6) UHS has authority to determine whether acquisition,

construction, or improvement of hospital facilities is necessary;

(7) UHS has sole authority to repair or replace any of its assets; (8)

UHS may obtain insurance policies payable solely to UHS; (9)

UHS has the authority to enforce rules and regulations regarding

safety and care; and (10) UHS controls the daily operations and

management of the hospital. (Petition, App. A, pp. 7a-8a).

Moreover, in concluding that respondents’ decision to

terminate petitioner’s employment did not constitute state action,

the Eleventh Circuit stressed the following factors:

Most importantly, however, the lease

relinquishes RCHA of all liabilities, gives

UHS sole discretion to hire and fire employees,

provides that UHS is the governing body of

University Hospital and medical staff,

mandates that UHS maintain and repair the

leased property at its own expense, requires

UHS to maintain insurance, confers upon UHS

the right and authority to make and enforce

rules and regulations and __ safety

considerations, and demands that UHS hold

RCHA harmless from any court action. Thus,

10

UHS and RCHA are not so intertwined in a

symbiotic relationship as to satisfy the nexus/

joint action test.

(Petition, App. A, pp. 17a-18a).

Accordingly, petitioner’s argument that UHS is merely a legal

fiction of RCHA is unconvincing. Although RCHA has some

concomitant oversight responsibilities in connection with the

funding it gives to support hospital operations, the day to day

management and operation of University Hospital is performed by

UHS, a private corporation.

Since, as recognized by the Eleventh Circuit, RCHA and UHS

are separate and distinct entities, the petitioner’s arguments that it

is unfair to recognize the private nature of UHS must also fail.

Petitioner’s suggestions that RCHA reorganized and placed the

operations of University Hospital in UHS’s control merely to avoid

liability for wrongful termination claims is simply unsubstantiated

by any evidence. As recognized by the Eleventh Circuit, the

evidence in the record for this case shows that the purpose of the

restructuring was to allow University Hospital to increase its

service area and compete with other private medical providers

outside of Richmond County. (Petition, App. A, p. 7a).

In question presented number three, petitioner, relying on

selective facts, also argues that the Court should grant certiorari in

this case due to a “conflict among the circuits” in applying the

“symbiotic relationship” test of Burton to other cases. See Greco v.

Orange Memorial Hospital, 513 F.2d 873 (Sth Cir.), cert. denied,

423 U.S. 1000 (1975); Crowder v. Conlan, 740 F.2d 447 (6th Cir.

1984); Jatoi v. Hurst-Euless-Bedford Hospital Authority, 807 F.2d

1214 (Sth Cir.), modified on other grounds, 819 F.2d 545 (Sth Cir.

1987); and Milo v. Cushing Memorial Hospital, 861 F.2d 1194

(10th Cir. 1988). The holdings of these cases are not in conflict

1]

with one another, but, rather, involve application of the Burton

“symbiotic relationship” analysis to a variety of factual contexts.

The Eleventh Circuit below analyzed the factual and legal analysis

of these cases and held that the Fifth Circuit’s decision in Greco

was the correct application of Burton’s symbiotic relationship test

to facts similar to those found in this case. Petitioner’s contention

that the application of the Burton “symbiotic relationship” analysis

to these previous cases merits review is merely an additional effort

to have this Court sift through the factual scenario of this case

which has twice been thoroughly examined by the courts below.

Furthermore, to the extent that any conflict may be deemed to

exist between the application of the “symbiotic relationship” test

to the particular facts of these cases, such conflict does not justify

review in this case. The Eleventh Circuit’s ruling under

consideration is consistent with the most recent decisions of this

Court discussing the application of Burton’s “symbiotic

relationship” test. In San Francisco, 483 U.S. at 547, n. 29, this

Court indicated that even under the Burton test relied upon by

petitioner, the intertwining connections between the state and the

private entity which form the “symbiotic relationship” must

somehow involve the alleged constitutional violation. /d.; see

also, NBC, 860 F.2d at 1027. The evidence in this case

convincingly demonstrates that the connections between RCHA

and respondent UHS, relied upon by petitioner, were not involved

with nor did they influence the respondents’ decision to discharge

petitioner. The Eleventh Circuit correctly concluded that, based

upon the facts of this case, state action is not present and the

Eleventh Circuit’s determination in this regard should not be

disturbed.

12

CONCLUSION

For the reasons set forth above, respondents respectfully

submit that the petition for a writ of certiorari should be denied.

Respectfully submitted,

RAYMOND G. CHADWICK, JR.

Counsel of Record

GARY J. TOMAN

R. PERRY SENTELL, III

KNOX & ZACKS

Attorneys for Respondents

P.O. Box 2043

Augusta, Georgia 30903

(706) 724-2622

fant