# Appendix — Vesom v. Atchison Hospital Association (No. 08-194)

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Appendix
- **Published:** January 1, 2008

## Text

APPENDIX A

UNITED STATES COURT OF APPEALS
TENTH CIRCUIT

No. 06-3353
(D.C. No. 04-CV-2218-JAR)

[Filed May 15, 2008]

PITT VESOM, M.D.,
Plaintiff - Appellant,

es

ATCHISON HOSPITAL ASSOCIATION;
RYAN THOMAS, M.D.; DOUGLAS
GORACKE, M.D.; DONALD SWAYZE,
D.O.,

Defendants - Appellees.

ORDER AND JUDGMENT

* This order and judgment is not binding precedent except under
the doctrines of law of the case, res judicata, and collateral
estoppel. It may be cited, however, for its persuasive value
consistent with Fed. R. App. P. 32.1 and 10" Cir. R. 32.1.

Za
Before O’BRIEN, BRORBY, and GORSUCH,

Circuit Judges.

Dr. Pitt Vesom sued the Atchison Hospital
Association and several individual members of the
Atchison Hospital Medical Executive Committee when
they refused to recommend his medical staff privileges
be renewed. Dr. Vesom appeals from summary
judgment granted in favor of the defendants. We
AFFIRM.

I. BACKGROUND

Dr. Vesom is an American citizen born in Thailand.
He maintained medical staff privileges at the Atchison
Hospital in Atchison, Kansas, for a substantial period
between 1983 through 2003. In 2003, the Association
refused to renew his staff privileges, allegedly because
he was a “disruptive physician.” Vesom sued the
Atchison Hospital Association and three individual
physicians (collectively, the Hospital), claiming race
discrimination under 42 U.S.C. § 1981 and Title VI;
conspiracy under 42 U.S.C. § 1985(3); antitrust
violations under section 1 of the Sherman Act, 15
U.S.C. § 1; and claims alleging retaliatory discharge
and intentional interference with contract under
Kansas law.

A. Hospital Bylaws

Atchison Hospital Association is a not-for-profit
corporation formed in 1912. Governed under Kansas
law, the Association’s purpose is to provide quality
health care and medical services for the citizens of

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Atchison and the surrounding area.’ To admit and
treat patients at the Hospital, a doctor must be an
active member of the medical staff. In turn, the
physicians and dentists on the medical staff work
under the Medical Staff Bylaws which “establish the
mechanisms to carry out the direct and delegated
responsibilities of the Medical Staff in cooperation
with the Hospital Administration and the Governing
Board.” (R. Vol. II at 493.) The “Governing Board” is
the Board of Directors which has “the ultimate
responsibility for the operation of the Hospital and for
providing patient care.” (/d.)

The medical staff elects officers to the Medical
Executive Committee (MEC). The MEC is comprised
of the Chief of Staff, the Vice Chief of Staff, the
Secretary/Treasurer, the immediate past Chief of Staff

and one “member at large” elected from the active
medical staff. According to the Bylaws, the MEC
oversees the functions of the medical staff and acts on
their behalf, but its authority is limited to “making
recommendations to the Governing Board;” and its
“actions are not binding until approved by the .. .
Board.” (Ud. at 499.)

The MEC’s duties include, among others,
recommending the acceptance or rejection of an
application for medical staff privileges or an
application for renewal, required every two years.
Once accepted, there is no guarantee staff privileges
will be renewed solely because the professional is
licensed to practice in Kansas. Only those who mect

' Atchison is a community of approximately 12,000 people.

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and maintain the qualifications, standards and
requirements of the applicable rules and regulations
will be accepted for renewal of staff privileges.

Should the MEC recommend a practitioner’s
privileges not be renewed, the Bylaws provide a
system to challenge the adverse decision. The
practitioner must be given written notice containing a
statement of the reasons for the action and a
description of fair hearing rights. The practitioner can
request a hearing before a Fair Hearing Committee
consisting of not less than five disinterested outside
physicians.

The MEC, the Governing Board and _ the
practitioner may each have legal counsel at the
hearing. All parties have the right to offer oral and
documentary evidence and to cross-examine the
witnesses. According to the defendants, the Fair
Hearing Committee is permitted to conduct
independent interviews, research and review. It then
must issue ae report of its findings and
recommendations to the Chief Executive Officer
(CEO), who forwards the report to the practitioner and
the other members of the Board.

Within ten days of receiving the report, the
practitioner may request appellate review by the
Board on actions of the Hearing Committee “taken
arbitrarily, capriciously or with bias” or “not supported
by the evidence.” The review is limited to the record
presented to the Fair Hearing Committee. The Board
then issues a final decision.

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B. Dr. Vesom’s History with the Hospital’

Dr. Vesom, a Board Certified internist and
cardiologist, was granted privileges at the Hospital in
September, 1983. With the exception of a few
colleagues, Vesom was excluded from the staff
members’ social events and activities. Although
Vesom was “highly qualified,” the majority of the staff
members routinely refused to refer their cardiac
patients to Vesom’s care. (RK. Vol. III at 1279.) His
wife, a certified pathologist, was unable to find
employment with Atchison Hospital.

Dr. Vesom was the Chairman of at least one service
section (primarily emergency services) from 1985
through 1995. In 1986, 1987 and 1991, he was a
member of the MEC. In June 1996, Dr. Vesom
voluntarily resigned and sold his medical practice to be
with his family in Thailand.’ He returned to Atchison
in 1998 and requested reappointment. The MEC
recommended he not be reappointed and Vesom
requested a fair hearing pursuant to the Bylaws.* The
Governing Board eventually chose not. to follow the
MEC recommendation and approved Vesom’s
conditional reappointment upon his approval of an
“Agreement and Release.” (R. Vol. III at 1026.) The

* The facts are set forth in the light most favorable to Dr. Vesom.
See Stover v. Martinez, 382 F.3d 1064, 1070 (10th Cir. 2004).

* The purchasing group, Mid-America Cardiology Associates,
continues to provide cardiology services in Atchison.

‘In 1998, the MEC was composed of Dr. Goracke (Chief of Staff),
Dr. Campbell, Dr. Sontheimer, Dr. Shriwise and Dr. Eplee.

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Agreement provided a one-year. provisional
appointment with proctoring by an independent
cardiologist and written reports of his behavior from
specific Hospital departments.* Vesom also stipulated
to a provision recognizing a concern Vesom may
engage in future disruptive behavior:

During his tenure on the Medical Staff, Dr.
Vesom shall enjoy all the rights and privileges
and be subject to all the rules, restrictions and
sanction as may be granted or imposed by the
Bylaws upon any physician on the Medical
Staff, including but not limited to, any and all
section thereof governing or relating to
“Disruptive Physicians.”

(R. Vol. Il at 1030.) Vesom’s next reappointment
request in 2001 was approved without incident and he
was granted privileges for two years.

In December 2002, Vesom _ submitted a
Reappointment Information Form and_ other
documents for his 2003 reappointment. Each renewal
packet included an Authority and Liability Waiver
which states:

I further waive any rights under Educational
Rights and Privacy Act or any statute granting
immunity to such Boards or Committees and
further agree to hold harmless such President,
Board or Committees evaluating my application

* The departments included Social Services, Nursing, Emergency
Room and the Intensive Care Unit.

Va

from any claim or action by or on my behalf in
the event such application for reappointment is
denied for any reason.

(R. Vol. If at 565.) At the time Vesom applied for
renewal of his privileges, the MEC consisted of Dr.
Goracke (Chief of Staff), Dr. Swayze (Vice Chief of
Staff), Dr. Jones (Secretary/Treasurer), Dr. Rider
(member at large), and Dr. Thomas (past Chief of

Staff).

Shortly before the MEC met to consider Vesom’s
renewal application, he and two other staff physicians,
Dr. Ware and Dr. Tayiem, made complaints regarding
the Hospital’s peer review process concerning one of
Dr. Thomas’ patients.° On January 3, 2003, these
three doctors met with Dr. Goracke and the CEO of the
Hospital, Virgil Bourne, to discuss their complaints.
On January 22, 2003, Vesom, Ware and Tayiem sent
their complaints in a letter to the Board of Directors of
the Hospital. One day later, a special meeting of the
Board was convened to discuss “pressing medical staff
issues.” (R. Vol. III at 1177.) In attendance were
Board members Bourne, Goracke and the Hospital’s
legal counsel, Andrew Ramirez. The only action taken
was to terminate the Hospital’s agreement with Dr.

Ware.

© Dr. Tayiem is a Palestinian physician who joined in the
complaints regarding the peer review process. Tayiem remains in
active status at the hospital and was a member of the MEC during
the discovery period.

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C. Denial of Privileges

In February 2003, the MEC met and determined it
would recommend Dr. Vesom’s renewal of privileges be
denied and Ware’s provisional privileges’ be
terminated. Eventually, the reasons given for denial
were based on the “disruptive physician” provisions of
the Bylaws. These provisions prohibit:

1. attacks (verbal or physical) leveled at
individuals, Hospital personnel or
patients which are personal, irrelevant or
go beyond the bounds of fair professionai
conduct;

3. non-constructive criticism addressed to
its recipient in such a way as to
intimidate, undermine confidence,
belittle or imply’ stupidity or
incompetence;

4. refusal to accept Medical Staff
assignments, Or to participate’ in
committee or departmental affairs on
anything but his or her own terms or to
do so in a disruptive manner;

7. verbal or physical threats of retribution,
litigation or violence directed at
individuals, Hospital personnel or
patients; or

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8. use of foul, abusive language.

(R. Vol. I at 150-51.) On February 18, 2003, Bourne
sent Drs. Vesom and Ware identical letters notifying
them of the MEC’s adverse recommendation based on
the conclusion they were disruptive physicians. On
February 24, 2003, Goracke, Bourne and Ramirez met
with the Board. The minutes of this meeting state:

The Executive/Credentials Committee further
informed the Board of their recommendation to
give David Ware .. . notice of Termination of
Provisional Active Staff Status and Privileges
effective March 18, 2003. They also informed
the Board of their recommendation to notify Pitt
Vesom ... of Termination of Active Staff
Privileges effective March 18, 2003.

(Vol. III at 1179.) The Board then met in executive
session with the Hospital’s attorney and the risk
manager.

Vesom requested a Fair Hearing on March 6, 2003.
Bourne responded with a letter delineating the specific
charges made against Dr. Vesom, an itemized listing
of the information used by the MEC in reaching its
recommendation (Vesom’s Credentials File), and the
witnesses expected to testify in support of the charges.
Vesom claims it was at this time he realized the MEC
would present alieged instances of disruptive conduct
but would not include exculpatory information and
documents. Prior to the Fair Hearing. he was provided
with copies of all the written exhibits that would be
used to supr ort the charges. The hearing ultimately
took place on January 24, 2004. Both the Hospital and

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Vesom were represented by attorneys and both parties
were permitted to offer testimony and evidence in
support of their positions. The Fair Hearing
Committee, a panel of five independent doctors, was
allowed to ask questions of their own. Understanding
its role was to determine whether the MEC’s decision
was “arbitrary, unreasonable or capricious,” the Fair
Hearing Committee unanimously determined the
evidence demonstrated Vesom had exhibited a
“pattern of disruptive behavior.” (R. Vol II at 731,
739.) Vesom requested appellate review before the
Board, which took place on March 25, 2004. The
Board affirmed the decision of the Fair Hearing
Committee and the MEC on April 2, 2004.

Throughout the appeal process, Dr. Vesom
maintained active medical staff privileges at the
Hospital. Afterward, he obtained privileges at
Cushing Hospital, approximately 25 miles away. In
September 2004, Vesom accepted an offer to practice
at a hospital in Poplar Bluff, Missouri.

Dr. Vesom filed this action against the Hospital
and Drs. Thomas, Goracke and Swayze. Dr. Vesom
claims these doctors conspired to deny him privileges
and preclude him from practicing in the community
because he is Asian and he had reported incidents of
professional incompetence committed by other doctors.
He asserted discrimination under 42 U.S.C. §§ 1981
and 1985, and Title VI of the Civil Rights Act of 1964.
He also claimed violations under the Sherman Act,
Kansas public policy (whistle-blowing) and intentional
interference with business relationships. The district
court granted summary judgment on all claims.

lla

On appeal, Vesom raises numerous issues. As to
his claims of racial discrimination, he contends the
district court erroneously determined the Hospital
Bylaws did not create a contract and there was no
factual issue whether the Hospital’s stated reasons for
its actions were pretextual. In large part, he
maintains the court’s ruling on pretext was due to the
court’s arbitrary evidentiary rulings. He further
contends the district court erred in granting summary
judgment on his Sherman Act claim, and his state law
whistle-blower and _ interference with business
relationship claims. Finally, he argues the waiver
contained in his renewal packet did not preclude his
lawsuit.

Il. DISCUSSION

We review the district court’s grant of summary
judgment de novo. See Stover, 382 F.3d at 1070.
Summary judgment is appropriate if “the pleadings,
depositions, answers to interrogatories, and
admissions on file, together with the affidavits, if any,
show that there is no genuine issue as to any material
fact and that the moving party is entitled to judgment
as a matter of law.” Fed. R. Civ. P. 56(c). In
conducting our analysis, we view all of the facts and
draw all reasonable inferences from the record in favor
of the non-moving party. See Stover, 382 F.3d at 1070.

A. Evidentiary Rulings

Dr. Vesom claims the district court failed to
recognize the existence of a material issue of fact due
to its refusal to consider important admissible
evidence. Accordingly, we begin with the evidentiary

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challenges. “Evidentiary rulings are committed to the
discretion of the trial court, and we review them only
for abuse of discretion. Our review is even more
deferential where the evidentiary ruling concerns the
admissibility of what is claimed to be hearsay
evidence.” United States v. Ramirez, 479 F.3d 1229,
1245 (10th Cir. 2007), cert. denied, 128 S.Ct. 1074
(2908). “Under this standard, a trial court’s decision
will not be reversed unless the appellate court has a
definite and firm conviction that the lower court made
a clear error of judgment or exceeded the bounds of

permissible choice in the circumstances.” Allen v.
Sybase, Inc., 468 F.3d 642, 659 (10th Cir. 2006).

1. Affidavits

Vesom claims the district court erred in failing to
consider statements contained in the affidavits of Dr.
Ware, Dr. Rider, Nurse Kathy Jackson and Rosetta
Birch, a former respiratory therapist. The court
disregarded parts of Ware and Rider’s affidavits
because the statements were based on inadmissable
hearsay or conclusory statements about the feelings
and intent of others. It struck the affidavits of Birch
and Jackson because Vesom failed to disclese these
witnesses until just before his response to the
summary judgment motion and offered no justification
for the delay.

A. Affidavits of Rosetta Birch and Kathy

Jackson

Rosetta Birch is a former respiratory therapist and
medical records clerk at the Hospital. Her affidavit
was signed on January 13, 2006, shortly before

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Vesom’s response to the Hospital’s motion for
summary judgment. One of the instances of Vesom’s
disruptive conduct involved an allegation that Birch
had complained about Dr. Vesom’s treatment of a
certain patient. Her affidavit contradicted the
allegation. In addition, Birch stated she never saw Dr.
Vesom “disrupt the flow of care to a patient.” (R. Vol.
III at 1299.) Her affidavit also stated that on more
than one occasion Birch heard the Hospital’s Risk
Management Officer remark that Dr. Vesom “neéds to
just go back to where he came from.” (/d.)

Kathy Jackson, a registered nurse at the Hospital
from 1969 until September 28, 2005, signed her
affidavit on January 6, 2006. During her last sixteen
years at the Hospital, Jackson was the head nurse in
the emergency room. She stated certain doctors did
not “appreciate[] constructive criticism and often
retaliated against those who critiqued hospital
procedures or standards” and, contrary to some of the
complaints regarding Vesom’s behavior to the
emergency room staff, she never found him to be
abusive or disruptive in the way he handled a
situation. (Jd. at 1301.)

In its reply brief, the Hospital urged the district
court to strike these affidavits because neither witness
was disclosed in Vesom’s original or amended witness
lists as required by Fed. R. Civ. P. 26(a)(1) & (e)(1).
Rule 37 states a party may not use such evidence
unless there is “substantial justification” and the
failure to disclose is harmless. Fed. R. Civ. P. 37.
According to the district court, the witnesses and their
testimony were known to Vesom and “it was feasible
...todisclose...these ... witnesses some time prior”

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to his summary judgment response. (Vol. I at 423.)
Because there was no substantial justification and the
witnesses were being used to defeat summary
judgment, it struck the affidavits.

The exclusion of evidence presented out of time is
“automatic and mandatory” unless the violation was
either justified or harmless. Finley v. Marathon Oil
Co., 75 F.3d 1225, 1230 (7th Cir. 1996). Vesom admits
the affidavits were submitted outside the discovery
time line and he did not seek to amend his earlier
disclosures. Nonetheless, he claims the court erred
because the witnesses (at least, Kathy Jackson) were
working at the Hospital during much of the discovery
phase and were only “willing to come forward and
testify” after the discovery deadline had passed.
(Appellant’s Br. at 35.) He also claims the failure to
disclose was harmless because the Hospital could have
deposed the witnesses before the reply brief deadline.
Vesom complains the district court “elevat{ed]
schedules and timetables over the duty to see that
justice is done.” (Appellant’s Reply Br. at 10.) We
disagree.

Birch and Jackson were no longer employed by the
Hospital for at least three months before their
affidavits were signed. There was sufficient time,
prior to filing his summary judgment response, to
amend earlier disclosures explaining the delay.
Instead, Dr. Vesom chose to sandbag. He submitted
the affidavits of two new and unannounced witnesses
who were available at the time of his Fair Hearing, in
an attempt to defeat summary judgment. He offers
nothing to support his speculation that these witnesses
were not willing to come forward until some time in

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2005. Even if true, Dr. Vesom knew they had
knowledge of material facts long before then. The
admissibility of the affidavits under Rule 56(e) does
not remove them from the district court’s sound
discretion to impose sanctions under Rule 37(c). The
district court did not abuse its discretion.

b Affidavits of Dr. Rider and Dr. Ware

The Hospital requested the court strike the
affidavits of Drs. Rider and Ware to the extent the
declarations were not based on personal knowledge,
contained inadmissible hearsay or were merely
conclusory statements. The district court granted the
motion. Dr. Vesom contends the court misapplied Rule
701 of the Federal Rules of Evidence which permits
testimony characterizing the behavior of other
members of the MEC as “angry,” “hostile” or
“retaliatory.” See United States v. Welch, 745 F.2d
614, 617-18 (10th Cir. 1984) (allowing lay opinion
defendant was angry but appeared lucid).

i) Dr. Rider’s Testimony

Dr. Rider’s testimony was presented in two
affidavits and his deposition.’Dr. Rider’s testimony
recounts his attendance as the at-large member of the
MEC committee meetings in Janu iry and February
2003. He states the other MEC members were “angry”
with Dr. Vesom. However, Rider goes further, stating
the doctors were angry because Dr. Vesom had voted

‘ Dr. Rider’s deposition was taken on March 29, 2005. He
submitted affidavits on August 30, 2004, and January 12, 2006.

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for an outside peer review of Dr. Thomas’ treatment of
a patient and at a later meeting, disputed the peer
reviews accuracy. Rider also stated the MEC
members were angry with Vesom’s discussions with
Bourne and his letter to the Board concerning the
inadequate practices at the Hospital. While Dr. Rider
was certainly in a position to observe what he believed
to be angry behavior, he does not recount any specific
statements that would support his conclusion as to the
reason for the other members’ anger.

In his second declaration, Rider stated the
committee members did not discuss specific instances
of behavior supporting a conclusion that Dr. Vesom
was disruptive prior to the decision to recommend
non-renewal. Rather, the determination that Vesom’s
privileges would not be renewed was a foregone
conclusion, bolstered by the Hospital attorney’s
counsel to the members that their decision could be
justified in terms of Bylaw violations. The list of
Bylaw violations and the exhibits from Vesom’s
credential files used at the Fair Hearing were compiled
by the Hospital’s attorney only after the decision to
deny a renewal of Vesom’s privileges. The district
court considered this testimony.

Dr. Rider concluded, however, “The animus directed
at Dr. Vesom by members of the MEC was not the
result of disruptive behavior on his part. Rather, it was
the result of professional jealousy of a better qualified
foreign born doctor whose competition and demanding
standards of care were resented by the hospital
employed medical! staff doctors.” (Ud. at 1296.) Again,
he offers no personal observation of specific statements
or conduct by the members to support his opinion.

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“Under Fed. R. Evid. 701, the testimony of a lay
witness in the form of opinions or inferences is
admissible if those opinions or inferences are (a)
rationally based on the perception of the witness and
(b) helpful to a clear understanding of the witness’
testimony or the determination of a fact in issue.’
Gossett v. Okla. ex. rel. Bd. of Regents for Langston
Univ. , 245 F.3d 1172, 1179 (10th Cir. 2001) (quotations
omitted). In Gossett, we reversed the district court’s
rejection of an affidavit which included the opinion of
a University instructor that a student was the victim
of gender discrimination. We determined the opinion
was admissible because:

?

[The] affidavit demonstrate|d] . . . her position
as an instructor in the Nursing School and on
the Admissions Committee provided her with
the opportunity to observe firsthand for several
years the School’s policies and practices with
respect to its treatment of male students. Her
opinion was a means of conveying her
impression based on what she had herself
perceived, and it was predicated upon concrete
facts within her own _ observation and
recollection.

Id. at 1180.

While Dr. Rider personally witnessed the actions of
the MEC and may have formed an opinion from his
observations, the district court properly excluded his
ultimate opinion — that the decision was based, at least
in part, on Vesom’s place of birth.

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We need not decide if this evidence is inadmissible
because it violated Rule 701. Rather, Rider’s second
affidavit directly contradicts his previous deposition
statements under oath.® While an affidavit will not be
disregarded merely because it conflicts with a prior
sworn statement, it deserves no consideration when it
“constitutes an attempt to create a sham fact issue.”
Burns v. Bd. of County Comm’rs of Jackson County,
Kan., 330 F.3d 1275, 1282 (10th Cir. 2003).

To determine whether an affidavit is a sham, we
consider “whether the affiant was cross-examined
during his earlier testimony, whether the affiant had
access to the pertinent evidence at the time of his
earlier testimony or whether the affidavit was based
on newly discovered evidence, and whether the earlier
testimony reflects confusion which the affidavit
attempts to explain.” 7d. Dr. Rider’s deposition was
taken on March 29, 2005. He testified in detail
regarding the ongoing animosity between the
hospital-employed physicians (Thomas, Goracke and
Swayze) and the independent physicians (Ware, Rider,
Arkom, Growney and Vesom). When asked how Dr.
Ware’s termination (a non-minority) supported Dr.
Vesom’s claim of racial discrimination, Dr. Rider
responded: “Well, as I say, I think Dr. Vesom’s case is
-- there may be some element that may be related to

® “[1)t is consistently held that an order or judgment which is
correct in ultimate effect will not be disturbed on appeal even
though the lower tribunal relied upon a wrong ground or gave an
untenable reason for its action. The issue on appeal is the
correctness in ultimate effect of an order or judgment, not the
reason or reasons given therefor by the trial court.” First Nat'l
Bank v. Luther, 217 F.2d 262, 266 (10th Cir. 1954).

19a

race, but I would consider that a small consideration.”
(R. Vol. III at 1059.) When later pressed with the
question: “So you would agree .. . that race did not
play a part in the decision to recommend
non-reappointment of Vesom’s' medical staff
privileges,” Rider responded: “I really don’t have
enough information of the thinking of the other
members of the staff to make a statement one way or
another.” (Ud. at 1063.)

Rider’s declaration in response to the Hospital’s
motion for summary judgment was signed on January
12, 2006. It does not purport to clear up any confusion
during the deposition nor does it claim Rider was
exposed to new evidence. Therefore, the declaration
should be disregarded as a sham or because, as he
testified in his deposition, it was not based on Rider’s
personal knowledge.

ii) Dr. Ware’s Testimony

Dr. Ware’s declaration was executed on January 12,
2006. The district court struck paragraphs “2, 3, 4, 5,
7 and 8" as hearsay and Dr. Ware’s “opinions about the
feelings and attitudes of certain physicians towards
plaintiff.” (R. Vol. I at 424.) Vesom maintains the
alleged hearsay statements were admissible as the
admissions of party-opponents and Dr. Ware’s lay
opinion was admissible under Rule 701.

Dr. Ware’s declaration states he was recruited to
Atchison in July 2002. He _ recounts an incident
shortly after his recruitment where Dr. Bourne gave
Ware a tour of the facility. During the tour, Bourne
identified Dr. Vesom and stated: “Watch out for him.

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He'll stab you in the back!” (R. Vol. III at 1306.)
Shortly thereafter, defendant Dr. Thomas told Ware he
“hated” Dr. Vesom and “it was no secret.” Ud.) While
golfing with defendant Dr. Goracke, Ware testified
Goracke “made disparaging remarks about Dr.
Vesom.” (Jd.) Dr. Ware opined that “the feelings and
attitudes expressed against Dr. Vesom were, in part,
based upon the fact that he was a foreign born doctor
coupled with his standard of providing high quality
care to his patients.” (Id.)

We agree the statements of Goracke and Thomas
are admissible as the admissions of a party-opponent.
Rule 801(d)(2)(A) of the Federal Rules of Evidence
provides: “A statement is not hearsay if... [t]he
statement is offered against a party and is... the
party’s own statement, in either his individual or a
representative capacity ....” But the remainder of Dr.
Ware’s statements are hearsay. Like Dr. Rider, Dr.
Ware fails to present personally observed statements
or conduct as the basis for his opinion. Therefore, the
district court did not err in excluding this evidence.

2. Documentary Evidence

Vesom maintains the district court erred in
refusing to admit documents from his Credential Files

® Ware also stated the Hospital was aware of Vesom’s complaints
to Kansas health authorities because Ware made comments to
various hospital personnel, including Dr. Goracke, prior to the
February 2003 MEC meeting, regarding both he and Vesom’s
intentions to report their complaints outside the Hospital. The
district court did not strike this testimony.

2ia

for lack of proper authentication. Vesom contends this
evidence was admissible on summary judgment
because the content of the material would be
admissible at tnial. Pastran v. K-Mart Corp., 210 F.3d
1201, 1203 n.1 (10th Cir. 2000). Further, the parties
had stipulated in a pre-trial order that the documents
contained in Vesom’s Credential Files were business
records and could be introduced without further
foundation.

As an initial matter, Vesom has failed to point us to
the specific documents he believes were erroneously
disregarded by the district court. While the record
reveals the Huspital did request specific documents be
disregarded, not all of those documents have been
included in the record. The documents which are
available are handwritten or contain handwritten
notes — none identify the author. Given this record, we
cannot say the district court abused its discretion in
failing to consider the pages we have viewed. See
United States v. McClaichey, 217 F.3d 823, 835-36
(10th Cir. 2000) (to the extent defendant did not cite to
the specific evidence in the record, the issue was
waived).

In sum, the district court did not abuse its
discretion in striking the affidavits of Rosetta Birch
and Kathy Jackson. The affidavits of Drs. Ware and
Rider regarding their subjective beliefs as to the
intent, thoughts or motivations of others were
correctly stric’en. To the extent the district court
disregarded testimony stating certain persons were
physically observed tu be “angry” or the statements of
party-opponents, we will consider such evidence on
appeal.

22a

B. Racial Discrimination Claims

When the plaintiff bringing a claim under § 1981"°
and Title VI" offers no direct evidence of
discrimination, we apply the burden-shifting scheme
of McDonnell Douglas Corp. v. Green, 411 U.S. 792
(1973).’? See Antonio v. Sygma Network, Inc., 458 F.3d

'0 42 U.S.C. § 1981 provides in relevant part:

(a)... All persons... shall have the same right in every
State ... to make and enforce contracts... .

(b) For purposes of chis section, the term “make and
enforce contracts” includes the making, performance,
modification, and termination of contracts, and the
enjoyment of all benefits, privi’~ges, terms, and conditions
of the contractual! relationship.

————

To establish a prima facie case, the plaintiff must show “(1) that
the plaintiff is a member of a protected class; (2) that the
defendant had the intent to discriminate on the basis of race; and
(3) that the discrimination interfered with a protected activity as
defined in § 1981.” Hampton v. Dilla. d’s Dept. Stores, Inc., 247
F.3d 1091, 1102 (10th Cir. 2004).

'' Title V1, codified at 42 U.S.C. § 2000d states, “No person in the
United States shall, on the ground of race, color, or national
origin, be excluded from participation in, be denied the benefits of,
or be subjected to discrimination under any program or activity
receiving Federal financial assistance.”

'* We recognize this is not an “employment” action and the parties
agree Dr..Vesom’s status with the Hospital was as an independent
contre_cor. However, courts routinely follow the McDonnell
Douglas model when considering claims of racial discrimination
brought by non-employees or independent contractors. See

23a

at 1177, 1181 (10th Cir. 2006). “Under McDonnell
Douglas, if the plaintiff can establish a prima facie
case of discrimination or retaliation, the burden shifts
to the defendant to show a _ legitimate
non-discriminatory or non-retaliatory reason for the
adverse employment action.” Id. “If the defendant
meets this burden, the burden shifts back to the
plaintiff to demonstrate that the defendant’s proffered
reason is pretext.” Id.

Dr. Vesom claims the “istrict court wrongly
rejected his claim that the Hospital Bylaws created a
contractual interest sufficient to support Vesom’s
§ 1981 claim. The Kansas Supreme Court has not
decided the question whether hospital bylaws create a
contract and those states which have decided the issue
are in disagreement.” Fortunately, we need not reach

Hampton, 247 F.3d at 1107 (non-employee).

'S Compare Van v. Anderson, 66 Fed. Appx. 524, *1 (5th Cir. 2003)
(unpublished) (“[SJection 1981 claims, breach of contract claims,
and tortious interference claims al] fail as a matter of law... .
[Neither the medical staff bylaws nor his business relationship
with his patients could constitute a contractual relationship upon
which liability could be predicated.”); Madsen v. Audrain Health
Care, Inc., 297 F.3d 694, 699 (8th Cir. 2002) (Missouri courts have
held that “hospita] bylaws cannot be considered a contract under
Missouri law because consideration is lacking.”), with Samuel v.
Herrick Mem’ Hosp., 201 F.3d 830, 835 n.1 (6th Cir. 2000)
(Florida has . . . legislat{ed] that a hospital must promulgate
bylaws and those bylaws create a binding contract between the
physician and the hospital.”); Marrese v. Deaconess Hosp., 966
F.2d 1456, *6 n.8 (7th Cir. 1992) (unpublished) (“[T]he Indiana
courts, ... have recognized that hospital medical staff bylaws can
constitute a contract between the hospital and its medical staff.”).

24a

this issue of first impression. Assuming for the
purposes of this case she Hospital Bylaws created a
contract sufficient to support Dr. Vesom’s § 1981 claim,
and also assuming he has established a prima facie
case under both § 1981 and Title VI, he fails to
establish the Hospital’s proffered reason for its actions
was a pretext disguising a racially discriminatory
animus.

C. Pretext

Under Tenth Circuit precedent, pretext may be
shown by “such weaknesses, implausibilities,
inconsistencies, incoherencies, or contradictions in the
employer’s proffered legitimate reasons for its action
that a reasonable factfinder could rationally find them

unworthy of credence and_hence infer that the
employer did not act for the asserted
non-discriminatory reasons.” Morgan v. Hilti, Inc.,
108 F.3d 1319, 1323 (10th Cir. 1997) (quotations
omitted). A plaintiff can make a showing of pretext
with evidence that the defendant’s stated reason for
termination was false. Kendrick v. Penske Transp.
Serus., Inc., 220 F.3d 1220, 1230 (10th Cir. 2000).
Evidence tending to show pretext permits an inference
that uhe employer acted for discriminatory reasons.
Morgan, 108 F.3d at 1323. At the summary judgment
stage, if a plaintiff advances evidence establishing a
prima facie case and evidence upon which a factfinder
could conclude that the defendant’s alleged
nondiscriminatory reasons for the employment
decisions are pretextual, the case should go to the
factfinder. Jd. “We do not always require actual
evidence of discrimination because, ‘[i]n appropriate
circumstances, the trier of fact can reasonably infer

25a

from the falsity of the explanation that the employer is
dissembling to cover up a discriminatory purpose....
Moreover, once the employer’s justification has been
eliminated, discrimination may well be the most likely
alternative explanation, especially since the employer
is in the best position to put forth the actual reason for
its decision.” Swackhammer v. Sprint / United Mgmt.
Co., 493 F.3d 1160, 1168 (10th Cir. 2007) (quoting
Reeves v. Sanderson Plumbing Prod. Inc., 530 U.S.
133, 147 (2002)).“ “However, it is not always
permissible for the factfinder to infer discrimination
from evidence that the employer’s explanation is
unworthy of belief.” Jd. “[I)f the record conclusively
revealed some other, nendiscriminatory reason for the
employer’s [adverse employment] decision, or if the
plaintiff created only a weak issue of fact as to whether
the employer’s reason was untrue and there was

abundant and uncontroverted independent evidence
that no discrimination had occurred,’ the fact that the
employer’s explanation was unworthy of belief would
no longer be sufficient to create an inference of
discrimination.” Jd. (quoting Reeves, 530 U.S. at 148).

Dr. Vesom finds it “incredible” that the district
court found evidence of a post hoc justification for the
denial of his reappointment, yet failed to deny
summary judgment. He argues this finding, alone,

'* Although Reeves spoke in terms of judgment as a matter of law
under Fed. R. Civ. P. 50, “the standard for granting summary
judgment ‘mirrors’ the standard for judgment as a matter of law,
such that ‘the inquiry under each is the same.” Reeves, 530 U.S.
at 150 (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
250-51 (1986)).

26a

permits an inference that the stated reason for
termination “is plainly false and pretextual and ample
evidence of mendacity.” (Appellant’s Br. at 34.) His
argument misapprehends his burden. While Dr.
Rider’s testimony states the four other members of the
MEC decided to recommend denial of Vesom’s renewal
application before they reviewed the Bylaws, Dr.
Vesom failed to present any evidence this decision was
motivated by racial animus. See Patel v. Midland
Mem 'l Hosp. & Med. Ctr., 298 F.3d 333, 342 (5th Cir.
2002) (“More importantly, even if Dr. Patel could
connect these events to his 1999 suspension, he still
fails to create a question of fact for the jury that race
motivated his suspension.”).

In Reeves, the Supreme Court determined the
defendants were not entitled to judgment as a matter
of law because “in addition to establishing a prima
facie case of discrimination and creating a jury issue
as to the falsity of the employer’s explanation,
petitioner introduced additional evidence that [the
employer] was motivated by age-based animus and
was principally responsible for petitioner’s firing.”
Reeves, 530 U.S. at 151. Dr. Vesom’s claims fail on
both factors.’®

'S The district court concluded (albeit in the context of Dr. Vesom’s
Sherman Act claim), the Board independently made the ultimate
determination to deny a renewal of Vesom’s privileges and there
was no evidence suggesting the Board did not act independently
in accepting the MEC’s recommendation after the Fatr Hearing
procedure was completed. On appeal, Vesom responds by stating,
“(t}here is significant evidence that the Fair Hearing Panel and
the Board of Directors exercised no real authority over the
determination to terminate Vesom; rather, they acted

27a

“[W]hen a plaintiffs evidence supports a
nondiscriminatory motive for the employer’s action
and the plaintiff presents no evidence to undermine
that motive, summary judgment for the employer is
appropriate.” Swackhammer, 493 F.3d at 1168. Dr.
Vesom unquestionably established he was disliked,
even hated, by other members of the medical staff and
members of the MEC. He also established his renewal
application was rejected shortly after he and two other

perfunctorily,” citing generally to EEOC v. BCI Coca Cola Bottling
Co. of Los Angeles, 450 F.3d 476, 484-86 (10th Cir. 2006), cert.
granted, 127 S.Ct. 852 and dismissed 127 S.Ct. 1931 (2007).
(Appellant’s Br. at 45.) This issue was not raised in the racial
discrimination context below. However, we stated in BCI:

[Blecause a plaintiff must demonstrate that the actions of
the biased subordinate caused the employment action, an
employer can avoid liability by conducting an independent
investigation of the allegations against an employee. In
that event, the employer has taken care not to rely
exclusively on the say-so of the biased subordinate, and
the causal link is defeated. Indeed, under our precedent,
simply asking an employee for his version of events may
defeat the inference that an employment decision was
racially discriminatory. Employers therefore have a
powerful incentive to hear both sides of the story before
taking an adverse employment action against a member
of a protected class.

Id. at 488 (citation omitted). It is undisputed the Board made its
decision only after five independent physicians (not associated
with the Hospital) heard arguments and received evidence from
Dr. Vesom, through his attorney, at the Fair Hearing. Vesom fails
to offers any reason why the causal chain was not broken at this
point.

28a

physicians (one Caucasian male and one Palestinian
male) complained about the peer review procedures at
the Hospital. It is also undisputed that both Dr.
Vesom and the Caucasian physician were denied
renewal of their privileges. The reasons given to both
physicians for the MEC’s actions were identical.

Dr. Vesom claims “virtually all of the alleged
disruptive activity of Dr. Vesom centered on his
attempts to improve the quality of health care at the
Hospital, or his complaints that he was being
discriminated against because of his race by the
Hospital administration.” (Appellant’s Br. at 44.)
While Dr. Vesom may believe his race was a factor, he
has not come forth with any evidence of his allegation.
Indeed, the only evidence of the MEC’s motivations
reveals an ongoing and escalating animosity between
the independent physicians (including Dr. Vesom) and
physicians employed by the Hospital. Because Dr.
Vesom failed to submit any admissible evidence of
racial discrimination, the district court appropriately
granted summary judgment in favor of the Hospital.

D. Sherman Act Claim

Section 1 of the Sherman Act states:

Every contract, combination in the form of a
trust or otherwise, or conspiracy, in restraint of
trade or commerce among the several States, or
with foreign nations, is declared to be illegal.
Every person who shall make any contract or
engage in any combination or conspiracy hereby
declared to be illegal shaJ] be deemed guilty of
a felony....

29a

15 U.S.C. § 1. To succeed on a Sherman Act claim, a
plaintiff must show concerted action and an
unreasonable restraint of trade. Systemcare, Inc. v.
Wang Labs. Corp., 117 F.3d 1137, 1139 (10th Cir.
1997). An antitrust injury must be analyzed from the
consumer’s viewpoint. Mathews v. Lancaster Gen'l.
Hosp., 87 F.3d 624, 641 (3d Cir. 1996). Thus, Dr.
Vesom needs to show the Hospital’s conduct “affected
the prices, quantity or quality of goods or services, not
just his own welfare.” Id.; see also Sanjuan v. Am. Bd.
of Psychiatry & Neurology, Inc., 40 F.3d 247, 251 (7th
Cir. 1994). The district court concluded, inter alia, Dr.
Vesom failed to submit evidence of any anti-trust
injury. There was no evidence he had exclusive
contracts with his patients or that the Board’s decision
drove up prices of cardiology service to any patient.

Vesom claims the court’s ruling must be reversed
because he was denied staff privileges for “the purpose
of diminishing the competition for services in the
Atchison community.” (Appellant’s Br. at 45.)
However, he fails to cite to record evidence apart from
asserting Dr. Rider’s testimony established the
defendants’ “concerted actions produced an
anti-competitive effect.” (Jd. at 46.) Assuming these
assertions are sufficient to avoid waiving this issue on
appeal, they are not enough to establish any error in
the court’s ruling.

E. Kansas Whistle-Blower Claim

Dr. Vesom claims the district court erred in
concluding his status, akin to an independent
contractor, precluded his public policy claim against
the Hospital under the Kansas whistle-blower law.

30a

“When the federal courts are called upon to interpret
state law, the federal court must look to the rulings of
the highest state court, and, if no such rulings exist,
must endeavor to predict how that high court would
rule.” Stickley v. State Farm Mut. Auto. Ins. Co., 505
F.3d 1070,1077 (10th Cir. 2007) (quotation omitted).
The Kansas whistle-blower statute provides as follows:

(a) No employer shall discharge or otherwise
discriminate against any employee for making
any report pursuant to K.S.A. 65-4923" or
65-4924.

(b)Any employer who violates the provisions of
subsection (a) shall be liable to the aggrieved
employee for damages for any wages or other
benefits lost due to the discharge or
discrimination plus a civil penalty in an amount
not exceeding the amount of such damages.
Such damages and civil penalty shall be
recoverable in an individual action brought by
the aggrieved employee. If the aggrieved
employee substantially prevails on any of the
allegations contained in the pleadings in an
action allowed by this section, the court, in its

6 Kan. Stat. Ann. § 65-4923(a) provides in relevant part:

If a health care provider, or a medical care facility agent
or employee who is directly involved in the delivery of
health care services, has knowledge that a health care
provider has committed a reportable incident, such health
care provider, agent or employee shall report such
knowledge ....

dla

discretion, may allow the employee reasonable
attorney fees as part of the costs.

Kan. Stat. Ann. § 65-4928. The Kansas Supreme court
has authorized a whistle blower action in tort by an
at-will employee for retaliatory termination. See
Palmer v. Brown, 752 P.2d 685 (Kan. 1988). Its
rationale for this extension was based in part on public
policy grounds. See id. at 687-90. The Kansas
Supreme court has not addressed whether the statute
covers an independent contractor.

Dr. Vesom contends the termination of his staff
privileges was based, at least in part, on his
complaints to the Board and the Kansas Health
Department regarding the Hospital’s peer review
procedures and professional incompetence of certain

doctors. He concedes Palmer and the Kansas statutory
protections do not reference the status of an
independent contractor. However, he urges we apply
Board of County Commissioners, Waubansee County,
Kansas v. Umbehr, which teaches that an independent
contractor’s entitlement to public policy protections
must be resolved in the context of surrounding facts.
518 U.S. 668, 678-81 (1996) (bright-line rule
distinguishing between employees and independent
contractors leaves Constitutional rights unduly
dependant on how the service provider's title is
labeled). Dr. Vesom asserts a physician’s economic
reliance on his relationship with the Hospital
constitutes a fact pattern demonstrating an
entitlement to whistle-blower protection under public
policy considerations and Kansas common law. We
decline Vesom’s invitation to create state law for
Kansas.

32a

The Kansas whistle-blower statute is plain and
unambiguous. It clearly provides a medical provider's
protection from retaliation by its employer. The plain
language does not include independent contractors.
Thus, the district court properly refused to extend that
protection outside its legislative boundaries. See
Graham v. Dokter Trucking Grp., 161 P.3d 695, 703
(Kan. 2007) (“[P}ublic policy is usually the arena of the
legislative branch.”); Higgins v. Abilene Mach., Inc.,
172 P.3d 1201, 1204 (Kan. App. 2007) (issue of public
policy is for the legislature to consider in the form of
an unambiguous statute); Palmer, 752 P.2d at 687-88
(“Before courts are justified in declaring the existence
of public policy, . . . it should be so thoroughly
established as a state of public mind so united and so
definite and fixed that its existence is not subject to
any substantial doubt.”) (quotation omitted). Dr.
Vesom does not aliege a constitutional violation as was
the case in Waubansee. He fails to explain why
Supreme Court precedent should control a state
common law claim or why a federal court should
expand state law based on public policy, despite the
presence of an unambiguous state statute. While, in
the future, Dr. Vesom may be able to persuade the
Kansas legislature to modify the existing statutes, it is
not our place to create new law for the Kansas
legislature or its state courts.

33a

F. Intentional Interference Claim

Kansas recognizes a cause of action for tortious
interference with a prospective business advantage or
relationship. Turner v. Halliburton Co., 722 P.2d
1106, 1115 (Kan. 1986). “The requirements for this
tort [are]: (1) the existence of a business relationship
or expectancy with the probability of future economic
benefit to the plaintiff; (2) knowledge of the
relationship or expectancy by the defendant; (3) that,
except for the conduct of the defendant, plaintiff was
reasonably certain to have continued the relationship
or realized the expectancy; intentional misconduct by
defendant; and (5) damages suffered by plaintiff as a
direct or proximate cause of defendant’s misconduct.”
Id. (internal citations omitted). Tortious interference
with contractual expectations or a prospective business
advantage are predicated on malicious conduct by the
defendant and “is aimed at. . . protecting future or
potential contractual relations.” Id.

Vesom complains the district court ruled against
him on his interference claim, even though “the
termination of his medical staff privileges interfered
with his business relations with the thousands of
patients he had treated in the 20+ years he practiced
in Atchison.” (Appellant’s Br. at 51.) However, Dr.
Vesom does not address the reason the district court
ruled against him — he failed to submit actual evidence
of interference besides his own conclusory statements.
Vesom presented no contractual relationship or
exclusive arrangement with his patients on which to
base his prospective loss. He proffered no affidavit
identifying one person who did not engage Dr. Vesom
due to his loss of privileges at the Hospital. On the

34a

other hand, the Association came forward with
undisputed evidence that Vesom continued to exercise
his staff privileges at the Hospital until April 2004,
when the Board accepted the MEC’s recommendation.
It is also undisputed that, after he left Atchison, Dr.
Vesom maintained privileges at Cushing Memorial
Hospital in Leavenworth, Kansas (approximately 25
miles from Atchison), and Horton Community Hospital
in Horton, Kansas (approximately 20 miles from
Atchison). He admittedly continued to see patients at
Cushing until his voluntary resignation of his
privileges at both hospitals to start a practice in Poplar
Bluff, Missouri.

Because Dr. Vesom bears the burden of persuasion
regarding his damages at trial, the Association “need
not negate [Vesom’s] claim.” Libertarian Party of N.M.

uv. Herrera, 506 F.3d 1303, 1309 (10th Cir. 2007).
Rather, the Association need only “point[{] out to the
court a lack of evidence on an essential element of
[Vesom’s] claim.” /d. The Association has done so.
Vesom must respond with “specific facts” from which
a rational trier of fact could find in his favor. Id.“({Tjhe
facts must be identified by reference to affidavits,
deposition transcripts, or specific exhibits incorporated
therein.” Id.

On appeal, Vesom makes no attempt to meet this
burden. His argument to the district court was equally
unambitious. He argued, “{pJlainly, plaintiff had a
thriving medical practice which was destroyed by
defendants’ intentional and unlawful misconduct.” (R.
Vol. lat 355.) This statement is not followed by record
cites. Moreover, Vesom’s affidavit statement gives no
indication that he has suffered damages. Indeed,

35a

there is some evidence in the record demonstrating his
new practice in Missouri may be far more lucrative
than his Kansas practice. Dr. Vesom’s “[c]onmciusory
allegations . . . do not establish an issue of fact under
Rule 56.” Bruner v. Baker, 506 F.3d 1021, 1025 (10th
Cir. 2007). The district court properly granted
summary judgment on this cleim.

IIt. CONCLUSION

Because there is no pretext, Dr. Vesom’s § 1981
racial discrimination claim fails. With the demise of
his § 1981 claim, his § 1985(3) conspiracy claim cannot
stand. Dr. Vesom’s failure to present any facts
supporting damages requires summary judgment be
granted in favor of the Association on his Sherman Act
claim and his state claim for interference with

prospective business relations. We decline to extend or
modify Kansas law on public policy grounds,
eliminating Dr. Vesom’s state whistle-blower claim.
Having sufficiently sifted through state law in
concluding summary judgment is appropriate on all
claims, we need not address Dr. Vesom’s waiver under
Kansas law.

AFFIRMED.
ENTERED FOR THE COURT

Terrence L. O’Brien
Circuit Judge

APPENDIX B

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF KANSAS

No. 04-2218-JAR

[Filed September 22, 2006]

PITT VESOM, MLD.,
Plaintiff,

VS.

ATCHISON HOSPITAL ASSOCIATION,

et al.,
Defendants.

ee ee ee ee a ed

MEMORANDUM AND ORDER

Plaintiff Pitt Vesom, M.D. filed this action against
Atchison Hospital Association (“AHA”) and three
physicians, Ryan Thomas, M.D., Douglas Goracke,
M.D., and Donald Swayze, D.O., who were members of
the AHA Medical Executive Committee (““MEC”), and
who voted to deny _plaintiffs application for
reappointment of medical and staff privileges at AHA.
Plaintiff contends that the denial of his staff privileges
at AHA resulted from an agreement and conspiracy to
fabricate reasons for refusing to continue his staff

37a

privileges because he is Asian, he had reported
incidents of professional incompetence at AHA, and
because defendants prevented or restrained him from
practicing medicine in the Atchison community.

The Court now considers the following motions: (1)
plaintiffs Motion for Leave to file Declaration and
Exhibits under Seal (Doc. i83); (2) defendants’ Motion
for Summary Judgment (Doc. 161); (3) defendants’
Motion to Exclude Declaration and Expert Testimony
of John-Henry Pfifferling, Ph.D. (Doc. 142); and (4)
defendants’ Motion to Exclude Affidavits and Expert
Testimony of Kurt V. Krueger, Ph.D. (Doc. 145). As
described more fully below, the Court grants plaintiffs
Motion for Leave to File Declaration and Exhibits
under Seal, grants defendants’ Motion for Summary
Judgment, and denies as moot both of defendants’
motions to exclude expert testimony.

I. Summary Judgment Standard

Summary judgment is appropriate “if the
pleadings, depositions, answers to interrogatories, and
admissions on file, together with the affidavits, if any,
show that there is no genuine issue as to any material
fact and that the moving party is entitled to judgment
as a matter of law.”’ A fact is only material under this
standard if a dispute over it would affect the outcome
of the suit.* An issue is only genuine if it “is such that
a reasonable jury could return a verdict for the

' Fed. R. Civ. P. 56(c).

* Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).

38a

nonmoving party.” The inquiry essentially determines
if there is a need for trial, or whether the evidence “is
so one-sided that one party must prevail as a matter of
law.”

The moving party bears the initial burden of
providing the court with the basis for the motion and
identifying those portions of the record that show the
absence of a genuine issue of material fact.® “A movant
that will not bear the burden of persuasion at trial
need not negate the nonmovant’s claim.”° The burden
may be met by showing that there is no evidence to
support the nonmoving party’s case.’ If this initial
burden is met, the nonmovant must then “go beyond
the pleadings and ‘set forth specific facts’ that would
be admissible in evidence in the event of trial from
which a rational trier of fact could find for the

nonmovant.”® When examining the underlying facts of
the case, the Court is cognizant that all inferences
must be viewed in the light most favorable to the

3 Td.
* Td. at 251-52.
° Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986).

® Thom v. Bristol-Myers Squibb Co., 353 F.3d 848, 851 (10th Cir.
2003) (citing Celotex Corp., 477 U.S. at 325).

"Id.

* Id.

39a

nonmoving party and that it may not make credibility
determinations or weigh the evidence.”

When deciding a summary judgment motion, the
Court may consider evidence submitted, if admissible
in substance, even if it would not be admissible, in
form, at the trial..° The Tenth Circuit recently
explained,

Parties may, for example, submit affidavits in
support of summary judgment, despite the fact
that affidavits are often inadmissible at trial as
hearsay, on the theory that the evidence may
ultimately be presented at trial in an admissible
form. Nonetheless, “the content or substance of
the evidence must be admissible.” Thus, for
example, at summary judgment courts should
disregard inadmissible hearsay statements
contained in affidavits, as those statements
could not be presented at trial in any form. The
requirement that the substance of the evidence
must be admissible is not only explicit in Rule
56, which provides that “[slupportingand
opposing affidavits shall . . . set forth such facts
as would be admissible in_ evidence,”
Fed.R.Civ.P. 56(e), but also implicit in the
court’s role at the summary judgment stage. To
determine whether genuine issues of material

* Matsushita Elec. Indus. Co. v. Zenith Radio, 475 U.S. 574, 587
(1986).

' Argo v. Blue Cross Blue Shield, 452 F.3d 1193, 1199 (10th Cir.
2006).

40a

fact make a jury trial necessary, a court
necessarily may consider only the evidence that
would be available to the jury.”

II. Factual Background
A. Evidentiary Objections

At the outset, the Court notes that significant
portions of the voluminous recitation of facts by both
parties are immaterial to the resolution of the
summary judgment motion. Although they aid in the
Court’s understanding of the context of the claims
made in this case, they do not impact the resolution of
claims and affirmative defenses under the applicable
summary judgment standard. There are a number of
evidentiary issues the Court must resolve before
determining the material] uncontroverted facts in this
matter. In their reply memorandum, defendants move
to strike numerous declarations submitted by plaintiff
with his response, including plaintiffs own
declarations made subsequent to his deposition.
Specifically, defendants seek to strike the declarations
of Dr. James Rider, Kathy Jackson, Rosetta Birch, Dr.
David Ware, and Dr. James Asher on various grounds.
Plaintiff filed a separate motion for leave to file his
third declaration with exhibits under seal (Doc. 194).
In response, defendants argue that the third
declaration is irrelevant and a “sham affidavit,” and
should not be filed for the same reasons that they
oppose consideration of plaintiffs second declaration.

"' Id. (quoting Thomas v. Int'l Bus. Machs., 48 F.3d 478, 485 (10th
Cir. 1995); Fed. R. Civ. P. 56(e)) (citations omitted).

4la

The Court ordered plaintiff to submit this third
declaration for in camera review so that it may decide
those issues. The Court has now reviewedthe
declarations in question, as well as reviewed in camera
plaintiffs third declaration and supporting exhibits by
plaintiff.

1. Plaintiff's Declarations

Plaintiff submitted two declarations with his
response to the summary judgment motion, titled
Vesom Declaration I (“Vesom I”) and Vesom
Declaration II (“Vesom II”). Plaintiff relies on these
declarations to support various factual statements in
his response brief. At the time he filed his response,
plaintiff also filed a motion to file a third declaration,
along with attached exhibits, under seal (“Vesom III”).
To be clear, there is no citation in the fact section of
plaintiffs response memorandum to Vesom III,
although plaintiff does discuss the declaration in the
argument section. Defendants ask the Court in their
reply to disregard all portions of plaintiffs “affidavit”
that are either not based on personal knowledge, or
create “sham” fact issues. Defendants also filed a
separate response to the motion to file a_ third
declaration under seal on the same grounds.

Sham Affidavit

Defendants argue that Vesom II and III should be
stricken because they constitute “sham affidavits,”

2 The Court will discuss defendants’ objections as applied to both
Vesom [IT and IIT.

42a

since they were composed long after plaintiffs
deposition and attempt to change the answers he gave
during that deposition. The Court may not disregard
Vesom II and III simply because they conflict with
plaintiffs prior sworn statements.** But “such evidence
may be disregarded when a court concludes that the
evidence is merely an attempt to create a sham fact
issue.”"* “[T]he utility of summary judgment as a
procedure for screening out sham fact issues would be
greatly undermined if a party could create an issue of
fact merely by submitting [evidence] contradicting his
own prior testimony.”” The Court looks at the
following factors to determine if Vesom II or III
present a sham fact issue: “whether the [party] was
cross-examined during his earlier testimony, whether
the [party] had access to pertinent evidence at the time
of his earlier testimony, or whether the [contested
evidence] was based on newly discovered evidence, and
whether the earlier testimony reflects confusion which
the [contested evidence] attempts to explain.””®

Vesom was deposed on March 28 and June 18,
2005. It appears from the transcripts that plaintiff was
not cross-examined by his own counsel during the
deposition. Discovery was due to be complete in this

'S Martinez v. Barnhart, 177 Fed. App’x 796, 800 (10th Cir. 2006).

'* Id. (citing Franks v. Nimmo, 796 F.2d 1230, 1237 (10th Cir.
1986)).

© Franks, 796 F.2d at 1237.

” Fel.

43a

case on July 15, 2005.*’ Plaintiff argues that the
documents attached to Vesom II and Vesom III were
not produced to him until May 25, 2005, and that
KDHE documents were not made available to him
until June 16, 2005, two days before the second day of
his deposition. Plaintiff maintains that he “did not
know of the content of these records and could not
have testified from his personal knowledge of these
examples of disparate treatment.” The Court agrees
that plaintiff could not have answered questions about
these documents during his deposition.

Defendants point the Court to one example of
plaintiffs attempt to create a sham issue of fact.
Defendants argue that during plaintiffs deposition, he
itemized instances of alleged discrimination that
formed the basis of his Complaint. At the conclusion of
the March 28 deposition, counsel for defendants
remarked: “Also marked as Vesom Deposition Exhibit
No. 114 a one page handwritten notes {sic] that was
on the inside cover of Dr. Vesom’s version of Vesom
Deposition Exhibit No. 101 that he has referred to as
an itemized list of the specific instances, I believe of
racial discrimination.”* Plaintiffs counsel responded,
“We agree that is Exhibit 114, notes of some of his
complaints about discrimination.”’’ At the June 18
deposition, plaintiff answered defendants’ questions
about Exhibit 114. At one point, defendants’ counsel

7 See Doc. 95 at 2.

8 (Doc. 164, Ex. 35, Vesom Depo. at 306.) The Court is unable to

locate this deposition exhibit in the record.

'9 Id. at 307.

44a

asked if the exhibit constituted a “full compilation of
all the incidents that you believe support the fact that
you were racially discriminated against.”” Plaintiff
replied, “That is correct.”"" Defendants argue that
Vesom II and III are subsequent attempts to change
this answer and create sham fact issues.

The Court declines to find that these affidavits are
“sham affidavits” as defendants urge. Defendants seem
particularly concerned that plaintiff repeatedly refers
to actions that constitute “disparate treatment” of
Asian physicians compared to other similarly situated
physicians at Atchison Hospital Association.
Defendants maintain that “[nlowhere was disparate
treatment, or the specific ‘examples’ and arguments
contained in the Declaration, mentioned.” The Court is
not persuaded by this argument. Plaintiff alleges a
number of counts in his Complaint that are based on
race discrimination. “Disparate treatment... is the
most easily understood type of discrimination. The
employer simply treats some people less favorably
than others because of their race. Proof of
discriminatory motive is critical.”*” Disparate
treatment is simply a way of referring to intentional
discrimination, as compared to disparate impact
claims which “involve employment practices that are
facially neutral in their treatment of different groups

9 (Doc. 164, Ex. 36, Vesom Depo. at 357-58.)
2) Id. at 358.
2 Carpenter v. Boeing Co., 456 F.3d 1183, 1187 (10th Cir. 2006)

(quoting /nt’l Bd. of Teamsters v. United States, 431 U.S. 324, 335
n.15 (1977)).

45a

but that in fact fall more harshly on one group than
another and cannot be justified by business necessity.
Proof of discriminatory motive . . . is not required.””
Although the Court sincerely doubts the term
“disparate treatment” was originally coined by plaintiff
without the guidance of his attorney, the Court finds
no impropriety or unfair surprise in its inclusion in the
declarations. The question of its materiality will be
addressed under the Court’s discussion of the
substantive discrimination counts, as this evidence
primarily points to plaintiffs perceived differences in
treatment between himself and other physicians at
AHA.

Further, the Court finds that the differences in
plaintiffs deposition and his declarations do not
amount to the creation of a sham issue of fact. The
deposition transcript reveals that plaintiffs counsel
clarified at the end of the first day of testimony, that
Deposition Exhibit 114 alleged some of the instances of
discriminatory conduct. Further, unlike most cases
that strike an affidavit as improper on these grounds,
plaintiff added to an answer given in his deposition,
rather than changing his answers entirely. Given that
plaintiff was not cross-examined, and that he did not
have an opportunity to review many of the documents
discussed in his declaration prior to the deposition, the

Id. The Court accepts that plaintiff's claims encompass claims
of intentional discrimination. Nothing in the briefs or the pretrial
order suggest that plaintiff advances a cause of action
encompassing “harassment,” as defendants suggest in their Reply.
(Doc. 193 at 28.)

46a

Court declines to strike them on the grounds that they
constitute sham affidavits. .

Personal Knowledge Requirement

Fed. R. Evid. 602 requires that a testifying witness
“halve] personal knowledge of the matter” testified
to.7* Also, Fed. R. Civ. P. 56(e) requires that affidavits
be made on personal knowledge and “set forth such
facts as would be admissible in evidence... . The court
may permit affidavits to be supplemented or opposed
by depositions, answers to interrogatories, or further
affidavits.” “Under the personal knowledge standard,
an affidavit is inadmissible if ‘the witness could not
have actually perceived or observed that which he
testifies to.”*° Statements of “mere belief in an
affidavit must be disregarded.””©

The Court finds that Vesom II and III contain
plaintiffs statements based on personal knowledge;
recitations of his attorney’s correspondence with
defendants; and reaction, beliefs, and opinions
concerning certain documents provided to him through
discovery in this case. The majority of Vesom II
contains plaintiffs arguments about why each
document in his credentials file is “manufactured to
make it appear that my behavior was inappropriate.”

*4 Fed. R. Evid. 602.

* Argo v. Blue Cross Blue Shield, 452 F.3d 1193, 1200 (10th Cir.
2006).

6 Id. (quoting Tavery v. United States, 32 F.3d 1423, 1427 n.4
(10th Cir 1994))

47a

in the course of making this point, plaintiff construes
the hospital bylaws, recites exhibits, and makes legal
and factual arguments. Often, plaintiffs contentions
make reference to “manufactured” or “doctored”
documents created by defendants. Vesom III similarly
construes documents produced through discovery, but
covered by protective order.

The Court disregards the statements in plaintiffs
declarations to the extent he attempts to construe and
interpret other summary judgment evidence. Such
construction and interpretation is not an appropriate
task for a witness’s affidavit, which is a tool used to
present facts and not beliefs and argument.”’ While the
Court will duly consider plaintiffs arguments made in
his summary judgment brief—the appropriate forum
for argumentation—it will not consider’ such
arguments couched in a party’s own affidavit, which
should represent pure statements of fact. Instead, the
Court construes the summary judgment record under
the applicable guidelines and determines if the
uncontroverted evidence sufficiently demonstrates a
genuine issue of material fact.

27 For example, plaintiffs statement that “[t]he failure to give
notice also contravened the hospital bylaws and_ their
requirements for dealing with disruptive behavior... .” (Doc. 182
4 13), is clearly a conclusory interpretation of other evidence in
the record—the Hospital Bylaws. Although this type of legal
argument is appropriate for the Court’s consideration on the
summary judgment motion, it is inappropriate as a submission of
fact. Indeed, it appears that much of plaintiffs statement of
additional material facts is cut and pasted directly from the
witnesses’ declarations.

48a

There are many statements in Vesom II and III
that are not based on personal knowledge, but are
conclusory opinions. Examples of such statements in
Vesom II include: “[T]he aforementioned medical staff
at AHA ... conspired to prevent me from practicing at
AHA;” and “When I reapplied for privileges at AHA in
i998 ... my application was treated differently from
any other application received prior to or since that
date.” The Court declines to itemize each and every
incidence of such statements, as Vesom II spans
fourteen pages and contains sixty-one paragraphs of
statements and Vesom III spans three pages with
eleven paragraphs of information. The Court will
disregard all statements in Vesom IT and III that are
not supported by other portions of the record, or that
do not represent statements based on plaintiffs
personal knowledge. The Court will only consider, for
purposes of determining the uncontroverted evidence,
those statements that plaintiff could have perceived or
observed, and will construe the evidence in the hght
most favorable to plaintiffas the non-moving party. As
such, the Court grants plaintiff's motion to file the
declaration and exhibits under seal ( Doc. 183)
and orders the Clerk’s Office to file under seal
the declaration and exhibits delivered to the
Court for in camera review.

2. Birch and Jackson Declarations

Defendants urge the Court to strike the
declarations of Rosetta Birch and Kathy Jackson
because they were not properly disclosed under Fed. R.
Civ. P. 26. Rule 26(a)(1) requires the parties to
provide, without waiting for a discovery request, the
name of each person “likely to have discoverable

49a

information that the disclosing party may use to
support its claims or defenses, unless solely for
impeachment.” Under Rule 26(e), the parties are under
a duty to supplement these initial disclosures.
Sanctions for violating the disclosure rules in Rule 26
are provided for in Rule 37:

A party that without substantial justification
fails to disclose information required by Rule
26(a) or 26(e)(1), or to amend a prior response to
discovery as required by Rule 26(a)(2), is not,
unless such failure is harmless, permitted to
use as evidence at a trial, at a hearing, or on a
motion any witness or information not so
disclosed.”

Plaintiff filed an amended witness and exhibit list
on February 1, 2005, which did not list either Birch or
Jackson as witnesses. Supplemental disclosures under
Fed. R. Civ. P. 26(e) were ordered to be served by June
6, 2005. The record does not reveal that an amended
witness list or a Notice of Service for supplemental
disclosures under Rule 26(e) was filed after the
February 1, 2005 disclosures. Birch and Jackson both
dated their declarations in January 2006, soon before
the response to the summary judgment motion was
filed. Plaintiff uses these declarations to support
additional material facts in his response to summary
judgment. Specifically, plaintiff uses the Birch
Declaration to support his contention that certain
documents relied upon by defendants in their decision
not to renew plaintiffs privileges, contain false

* Fed. R. Civ. P. 37(c)(1).

50a

information. Both declarations are used to support
plaintiffs contention that.any legitimate reason for the
denial of his privileges is a pretext for discrimination.
Because these declara.ions are being used byplaintiff
to support elements of his discrimination claims, the
Court finds that the failure to disclose Birch and
Jackson as potential witnesses, who could then be
deposed by defendants, is not harmless.

Under these circumstances, the Court is unable to
find that plaintiff was substantially justified in failing
to disclose this information. Both witnesses attest that
they were employed by AHA for years, during the
same period of time that plaintiff was affiliated with
the hospital. These are not instances of witnesses who
were unknown to the plaintiff. Neither declaration
relies upon documents that were not produced prior to

the deadline to file supplemental disclosures. Even if
these witnesses were discovered after that deadline,
Rule 26 imposes a continuing duty upon parties to
supplement their disclosures. Certainly, it was feasible
for plaintiff to disclose these two witnesses some time
prior to when he responded to the summary judgment
motion.

Because the Court finds that plaintiff was not
substantially justified in withholding this information,
and that the failure to disclose was not harmless, the
Court grants defendants’ motten to strike the Birch
and Jackson declarations.

3. Dr. Rider’s Declaration

Defendants move to strike Dr. James Rider’s first
declaration (“Rider I”), because it contains hearsay

5la

statements and is not based on personal knowledge.
Much like plaintiffs declarations, Dr. Rider’s
declaration contains both facts based on personal
knowledge, as well as conclusory opinions or beliefs.
The Court finds that Dr. Rider’s account of the
committee meetings he attended are based on personal
knowledge. However, his conclusions about how the
other members felt toward plaintiff could not be based
on personal knowledge.

Alternatively, Dr. Rider’s belief that the other
committee members were “angry” at plaintiff, as
stated in paragraph 2, must be based on things those
members told him, which is inadmissible hearsay
evidence. Inadmissible hearsay evidence in an affidavit
is not to be considered on a motion for summary
judgment.”? However, the Court finds that as a

member of the MEC at the time the decision about
plaintiffs privileges was made, Dr. Rider does have
firsthand, personal knowledge of events. that
transpired in the meetings that he attended and
during the _ collective decision-making process.
Therefore, the Court will only disregard the
declaration to the extent it states Dr. Rider’s
conclusory beliefs about the feelings or intent of
others.

*? Treff v. Galetka, 74 F.3d 191, 195 (10th Cir. 1996); Ryan v.
Shawnee Mission Unif. Sch. Dist. No. 512, 438 F. Supp. 2d 1233,
1236 (D. Kan. 2006).

52a
4. Dr. Ware’s Declaration

Defendants move to strike Dr. David Ware’s
Declaration because it contains inadmissible hearsay
and is not entirely based on personal knowledge. The
Court agrees. Paragraphs 2, 3, 4, 5, 7, and 8 all
amount to inadmissible hearsay—the witness is
recounting statements he heard that were made by
other declarants. The Court does not anticipate any
exclusion or exception to the hearsay rule that would
apply to these statements. Further, Dr. Ware states
his opinions about the feelings and attitudes of certain
physicians toward plaintiff. The Court will only
consider the small amount of Dr. Ware’s declaration
that is based on admissible evidence and will not
consider hearsay statements or statements about Dr.
Ware’s conclusory opinions.

5. Dr. Asher’s Declaration

Defendants move to strike Dr. James Asher’s
declaration because it is not based on personal
knowledge. Dr. Asher was the chief executive officer of
AHA for a number of years until his retirement. in
1990. He was responsible for recruiting plaintiff to
establish a practice in Atchison in 1983. Much of Dr.
Asher’s declaration is based on information that “he
has learned” or that is his “belief.”*° As defendants

*° For example. in paragraph 4: “I have learned from staff at AHA

..” and “ I believe the reduction in the size and function of the
ICU is directly related to the termination of [his] staff privileges.”
In paragraph 5: “It is my belief... that the decision to get rid of
[plaintiff] was and continues to be economically destructive to the

53a

point out, much of Dr. Asher’s statements concern
events that occurred after he retired in 1990. There is
no basis provided in the declaration for his personal
knowledge of these later events. Therefore, because
Dr. Asher’s declaration relies almost entirely on
hearsay and information that Dr. Asher has not
acquired through personal knowledge, the Court
disregards the majority of the declaration.

6. Authentication of Documents

Defendants argue that many documents filed in
support of plaintiff's summary judgment response are
not properly authenticated and are_ therefore
inadmissible. Specifically, defendants object to a
number of handwritten notes filed as attachments to
Vesom II.

Unauthenticated documents, once challenged,
cannot be considered by a court in determining
a summary judgment motion. In order for
documents not yet part of the court record to be
considered by a court in support of or in
opposition to a summary judgment motion they
must meet a two-prong test: (1) the document
must be attached to and authenticated by an
affidavit which conforms to rule 56(e); and (2)
the affiant must be a competent witness
through whom the document can be received
into evidence .. . . Documentary evidence for
which a proper foundation has not been laid

hospital... .” and “I have learned that... the hospital census has
been drastically reduced.”

54a

cannot support a summary judgment motion,
even if the documents in question are highly
probative of a central and essential issue in the
case.”

The Court agrees with defendants that the
handwritten notes attached to Vesom II do not appear
to be authenticated under this standard. It appears to
the Court that, at the very least, these notes were
written by more than one person. These documents
could only be authenticated in Vesom II if Vesom
himself composed all of these handwritten notes, or if
he was familiar with the handwriting.* Because
Vesom II does not set forth either method of
authentication, the Court may not consider these
documents.

3! In re Harris, 209 B.R. 990, 996 (B.A.P. 10th Cir. 1997) (quoting
11 James Wm. Moore, et al., Moore’s Federal Practice
§§ 56.10(4]{clli], 56.14[2]}[c] (8d ed. 1997)); see also Toney v.
Cuomo, 92 F. Supp. 2d 1186, 1196 (D. Kan. 2000), affd, 221 F.3d
1353 (10th Cir. 2000).

32 See Fed. R. Evid. 901(b).

55a

B. Uncontreverted Facts*

The following facts are cither uncontroverted,
stipulated to, or viewed in the light most favorable to
plaintiff. Plaintiff is a medical doctor licensed to
practice medicine by the Kansas Board of Healing
Arts, certified in the specialties of cardiology and
internal medicine. Plaintiff is a citizen of the United
States and of Kansas, but was born in Thailand and
has Thai ancestry. Defendant AHA is a not-for-profit
corporation organized and existing under the laws of
the State of Kansas and has its principal place of
business in Atchison, Kansas.** In 2003, defendants

33 Tn the future, the parties are encouraged to follow the local rules
in this district on page limitations, as well as content of briefs,
which encourages a concise statement of facts. D. Kan. R. 7.1, 7.6
(limiting the argument section of briefs and memoranda to thirty
(30) pages if no prior leave of court requested and providing for
content of briefs). Moreover, plaintiffs practice of controverting
facts with general citations to exhibits, or a general reference to
his statement of additional material facts, presents a cumbersome
task for the Court in determining the truly uncontroverted
material facts in this matter. Given that plaintiff submitted 116
paragraphs of additional facts (many of which are repetitive of
facts already narrated by defendants), the Court should not be
presumed to glean which statements or general references
plaintiff contends specifically controvert the statements made by
defendants. Plaintiffs counsel is strongly discouraged from this
method of controverting factual statements and the Court declines
to conduct a fishing expedition to uncover evidentiary support for
plaintiff's contention that certain facts are controverted when not
provided with a specific citation to the record. See D. Kan. R.
56.1(b).

4 42 U.S.C. § 2000d.

56a

Ryan Thomas, M.D., Douglas Goracke, M.D., and
Donald Swayze, D.O., were members of the Hospital’s
MEC. Dr. Thomas is a board certified family
practitioner with obstetrical privileges and was the
past Chief of Medical Staff. Dr. Goracke is a board
certified anesthesiologist and was Chief of Staff at the

time. Dr. Swayze is a board certified surgeon and was
Vice Chief of Staff at the time.

The Bylaws

The Atchison Hospital Medical Staff Bylaws
(“Bylaws”) are organized by the medical staff at AHA.”
They “establish the mechanisms to carry out the direct
and delegated responsibilities of the Medical Staff in
cooperation with the Hospital Administration and the
Governing Board.” The Governing Board (“Board”) is
a group of individuals who constitute the Board of
Directors at AHA, “having the ultimate responsibility
for the operation of the Hospital and for providing
patient care.”

The medical staff are practicing and licensed
physicians and dentists who have been formally
appointed and enjoy the privilege of attending patients
at AHA. The Bylaws state that the medical staff
agrees to accept and abide by the Bylaws. Under the
Bylaws, membership to the medical staff is a privilege
and no physician is “entitled to membership to the
Medical Staff or to the exercise of particular clinical
privileges at the Hospital merely by virtue of the fact

———— ee

°5 The parties agree that the December 19, 2002 Bylaws, attached
to defendants’ motion for summary judgment, govern this dispute.

57a

that he/she . . . has previously had Medical staff
membership or privileges in this Hospital.” Physicians
are appointed medical staff privileges at AHA for a
two-year period. After such period is over, physicians
must file an application for reappointment if they wish
to maintain their privileges.

Disruptive Behavior Provisions

Among other things, the Bylaws dictate that, as a
condition to accepting medical staff membership, the
member must agree to “conduct him/herself in a
professional, cooperative manner with colleagues and
members of the Hospital Staff.” Also, Article X of the
Bylaws dictates AHA’s policies concerning medical
staff conduct and the impaired provider. This article
provides guidelines for medical staff concerning
unacceptable disruptive behavior. This list includes,
but is not limited to: impertinent and inappropriate
comments (or illustrations) made in patient medical
records and physicians’ orders or other official
documents including the impugning of the quality of
care in the Hospital or attacking particular
individuals, nurses, or Hospital policies; non-
constructive criticism addressed to the recipient in
such a way that intimidates, undermines confidence,
belittles, or implies stupidity or incompetence; refusal
to accept medical staff assignments or participate in
committee or departmental affairs on anything but his
or her own terms or to do so in a disruptive manner;
and verbal or physical threats of retribution, litigation
or violence directed at individuals, Hospital personnel
or patients.

Sa

Under Article X, any reports of violations of
disruptive conduct or the impaired provider provision
must be in writing and submitted and investigated in
accordance with Article XII, which governs “Corrective
Action.” Corrective action requires any report
regarding a medical staff member to be made to the
Chief of Staff. The procedures set forth for
implementation of corrective action in Appendix B
provide that upon receiving notice of a reportable
incident, including for disruptive behavior, “any officer
of the Medical Staff, the chairperson of a Service or
Committee, the Chief Executive Officer of the Hospital
or any member of the Governing Board of the Hospital
may request corrective action against such
practitioner.” If corrective action is requested, then the
MEC investigates the report and submits a written
report. of the investigation to the Board. Before the

report is made, however, the practitioner has the
opportunity to interview with the MEC so that he or
she may discuss, explain, or refute the nature of the
charge. The summary is then submitted with the
report to the Board. Ultimately, the Board either
approves or modifics the MEC recommendation.

The MEC

The medical staff elects three officers for the
purpose of carrying out certain functions on behalf of
the staff. These officers are the Chief of Medical Staff.
Vice Chief of Staff, and Secretary/Treasurer and they
are nominated and elected by the medical staff to serve
one-year terms. The Medical Executive Committee
(“MEC’”) consists of these three officers, as well as the
immediate past Chief of Staff and a “member at large”
elected from the active medical staff annually. In

59a

gencral, the MEC is charged with oversecing the
functions of the medical staff. “Its authority is limited,
however, to making recommendations to the
Governing Board.”” The Credentials Committee
consists of the members of the MEC and evaluates new
applicants to the medical staff, as well as those
members applying for reappointment. In 2003,
defendants Dr. Thomas, Dr. Goracke, and Dr. Swayze
were members of the MEC. At that time, Dr. Thomas
was the past Chief of Medical Staff, Dr. Goracke was
Chief of Staff, and Dr. Swayze was Vice Chief of Staff.
In addition to the defendant, the MEC included Dr.
James Rider, who was a membcr-at-large, and Dr.
Michael Jones, who was the Secretary/Treasurer.
Neither of these members of the Executive Committee
are parties to this dispute.

Application Process and
Fair Hearing Procedures

Physicians seeking medical staff membership must
apply in writing after a preapplication screening
process. The Credentials Committee then collects all of
the documentation (licenses, references, etc.) and
prepares 4 report to submit along with the application
and supporting material to the Chief of Staff for review
by the MEC. The MEC then investigates and makes a
recommendation to the Board whether the application
should be granted, and if so, if any restrictions should
apply. The MEC is to evaluate evidence of character,

yrofessional and ersonal competence, and
if

qualifications and ethical standing of the practitioner

” (Doc. 164, Ex. 4A, Bylaws at 11 7 2.)

60a

before making its recommendation. Finally, the Board
reviews the application material and is the ultimate
authority in granting a practitioner privileges and
decides whether to accept or reject the MEC’s
recommendation.

Once the period of appointment ends, which is
usually after two years, the medical staff member
must be reappointed to continue their privileges. The
same procedures apply to the reappointment process
as the initial appointment process, in addition to the
procedures set forth in Appendix A. Section 5(f) of
Appendix A provides a list of fourteen criteria upon
which the MEC bases its recommendation for
reappointment. This criteria includes attendance at
medical staff meetings and participation in staff
duties; compliance with the Bylaws; and behavior in
the Hospital, including cooperation with medical and
Hospital personnel. The MEC recommends to the
Board whether a staff member’s privileges should be
increased, reduced, terminated, or remain the same.
Finally, the Board reviews the MEC’s recommendation
and the application materials, and makes the final
reappointment decision.

The denial of reappointment by the Board, and/or
a recommendation by the MEC to deny reappointment
are adverse recommendations that trigger the Fair
Hearing Procedure set forth in the Bylaws. Under the
Fair Hearing Procedures, the practitioner against
whom the decision has been made is given special
notice in writing of the recommendation or decision,
which must contain a statement of and reasons for the
recommendation or decision and inform’ the
practitioner of his or her right to request a hearing.

6la

Appendix A of the Bylaws sets forth the procedures
specific to the Fair Hearing. If a hearing is requested,
the Chief Executive Officer and/or the Chief of Staff
appoints a Hearing Committee, which must be
composed of at least five members composed of medical
staff or outside physicians who have not been actively
involved in the consideration of the matter at previous
levels of investigation or consideration.

At the hearing, the practitioner, the MEC and
Board may each have counsel present. Each party is
entitled to call and examine witnesses, to introduce
written evidence, to crossexamine any witnesses, to
challenge any witness and to rebut any evidence. The
Hearing Committee may consider any pertinent
material on file with AHA and any evide ice produced
at the hearing, including “any information regarding
the practitioner who requested the hearing, including,
but not limited to, any material contained in the
records of the Hospital regarding the practitioner who
requested the hearing, so long as such material has
been admitted into evidence at the hearing and the
affected practitioner had the opportunity to comment
thereon, or, by other evidence, to refute it.” Appendix
A requires the CEO to promptly send a copy of the
Hearing Committee’s written report of its
recommendation to the practitioner and Chief of Staff
by certified mail.

Appendix A also allows for a practitioner to appeal
an adverse recommendation from the Hearing
Committee within ten days. The appeal must be held
only on the record upon which the Hearing Committee
recommendation was made based on the grounds of:
(1) substantial and prejudicial failure on the part of

62a

the Hearing Committee to comply with the Bylaws
orrequirements of law; (2) an arbitrary or capricious
decision, or decision made with bias; or (3) the action
of the Hearing Committee is not supported by evidence
in the record. Appellate review is conducted by the
Board. The Board then must render a final decision in
writing within ten days after the appellate review
hearing.

1998 Application

Plaintiff was first granted medical staff privileges
at AHA in 1983. He was born in Thailand, came to the
United States in 1977, and became a United States
citizen in 1996. During his time at AHA, plaintiff and
his wife felt socially ostracized by other physicians at
AHA. Plaintiff applied for and was_ granted
reappointment every two years after his initial
appointment until 1996. On July 22, 1996, plaintiff
voluntarily resigned his staff privileges and left the
Atchison community and spent a period of time in
Thailand. In March 1998, plaintiff returned and
applied for appointment at AHA. On October 9, 1998,
the MEC recommended that plaintiff not be granted
staff membership privileges. Plaintiff requested a fair
hearing, but the Board did not follow the MEC
recommendation. Instead, the Board offered plaintiff
a conditional reappointment, which granted him staff
membership on a provisional one-year basis pursuant
to a Settlement Agreement.*’ The Settlement
Agreement provided for an independent proctor to

*’ Plaintiff was due for reappointment, however, in two years
pursuant to the Bylaws.

63a

review plaintiffs medical records for three months,
and to review the manner of practice used by plaintiff,
including critiquing care decisions and monitoring the
results of care rendered. For nine months, 30% of
plaintiffs medical records would be _ reviewed
randomly. The proctor would report his reviews to the
CEO, the MEC, and to plaintiff. The Settlement
Agreement also required certain departments to
submit written reports for the purpose of identifying
any problems or concerns that arose regarding
plaintiffs interaction with medical and hospital staff.
Also part of this agreement is a condition that during
plaintiffs provisional period, he is not to be alone with
any female employee or patient within the Hospital,
except in emergency situations. Finally, the
Settlement Agreement releases the parties from any
lability or claims that arose before the agreement. The
Settlement Agreement provides for AHA’s response to
inquiries about whether plaintiffs privileges had ever
been suspended, revoked, or disciplined:

On December 19, 1995, Dr. Vesom’s clinical
privileges were summarily suspended by
decision of the Hospital’s Chief of Staffand CEO
for non-compliance with recommendations of
the Kansas Medical Society-Medical Advocacy
Program (“KMS-MAP”). Thereafter, the
Hospital was informed that Dr. Vesom was in
compliance with the recommendations of KMS-
MAP. Accordingly, on December 22, 1995 the
summary suspension was withdrawn prior to
any hearing.”

38 (Doc. 163, Ex. 38 J 16.)

64a

The Settlement Agreement is signed by plaintiff and
by Dr. W. David Drew, President and CEO of AHA at
the time.

On February, 27, 2001, plaintiff was notified that
his next application for reappointment was approved
by the Board. Plaintiff was never an employee of AHA
or of the individual defendants.

~~—

Plaintiffs Complaints

The Peer Review Committee at AHA performs peer
review for the Medical Staff, utilizing criteria and
indicators established by the Medical Staff. Under the
Bylaws, the Chief of Staff reviews cases and the MEC
then performs a screening. fhe committee meets ten
times per year.

On January 3, 2003, plaintiff and Dr. David Ware
met with the CEO of the Hospital, Virgil Bourne, and
Chief of Staff, Dr. Goracke, about concerns and
recommendations they had about certain hospital
policies. According to a letter signed by plaintiff, Dr.
Ware, and Dr. A.K. Tayiem documenting these
concerns, AHA “employees” had been systematically
violating the federal and state health rights of its
patients for years through its over-reliance on
generalist care and sham-peer reviews, and blatantly
discriminating against the federal rights of
independent specialists by sanctioning them “at the
behest” of its own generalists. The physicians asked for
such changes as, among other things, peer review of
major cases by outside reviewers and less political
credentialing of physicians. This letter was sent to
William R. Thornton, the Chairperson of the Board of

—_

65a

Directors, on January 22, 2003. Thornton responded
on January 29, 2003 that he had forwarded the letter
on to the Risk Manager for investigation.

On January 23, 2003, the Board of Directors held a
meeting where they discussed Dr. Ware’s contract. A
motion passed unanimously to implement a clause in
Dr. Ware’s contract that terminates the contract with
or without cause upon ninety days written notice. The
Board agreed to immediately serve notice of this
decision to Dr. Ware by letter.

On March 4, 2003, Mary Kabriel, a_ risk
management specialist with the Kansas Department
of Health and the Environment (“KDHE”), Bureau of
Health Facilities, arrived at AHA for an unannounced
survey due to a report that had been filed against
AHA. Later, it became known that Dr. Ware and
plaintiff had complained about the handling of a
particular case where a mother suffered an amniotic
fluid embolism during birth. Dr. Ware and plaintiff
were critical of the peer review process in that case
and argued for outside peer review. In Vésom I,
plaintiff concedes that he filed this report with the
KDHE, and that it was not investigated until after he
was notified of the denial of his application for
reappointment. Kabriel cu-ducted a total of six on-site

visits to AHA in March 2003.

2003 Reappointment

When plaintiff applied for reappointment on
December 15, 2002, he signed an “Authority and
Liability Waiver.” The waiver states:

66a

I further waive any rights under Educational
Rights and Privacy Act or any statute granting
immunity to such Boards or Committees and
further agree to hold harmless such President,
Board or Committees evaluating my application
from any claim or action by or on my behalf in
the event such application for reappointment is
denied for any reason.

The waiver is a on a preprinted form and further
states that the applicant, “agree[s} to abide by the
Bylaws, Rules and Regulations of the Medical/Dental
Staff.””

In February 2003, the MEC reviewed plaintiffs
application and the records from his “credentials file”
at AHA. On February 18, 2003, plaintiff was provided
a three-page letter signed by CEO Bourne, titled
Notice of Adverse Recommendation and Fair Hearing
Rights that fully advised plaintiff of his rights under
the Fair Hearing provisions of the Bylaws. The reasons
for the denial of plaintiff's reappointment stated in the
letter are: (1) “failure to comply with Medical Staff
Bylaws and Rules and Regulations’; (2) “[his] behavior
in the hospital, which showed a lack of cooperation
with medical and hospital personnel as it relates to
patient care, and the orderly operation of AHA, and
[his] general attitude toward AHA and its personnel”;
(3) “failfure] to discharge [his] responsibilities -—for
Staff, Committee and Hospital functions for which [he]
was responsible by staff category assignment,
appointment, and election or otherwise”; (4) “[he]

3° (Def. Ex. 7.)

67a

engaged in verbal attacks on individuals and AHA
personnel that were personal, irrelevant, and went
beyond the bounds of fair professional conduct”; (5)
“{he) made impertinent and inappropriate comments
in official documents, including the impugning of the
quality of care in AHA and attacked particular
individuals and AHA policies”; (6) “[he] engaged in
non-constructive criticism addressed to recipients in
such a way as to intimidate, undermine confidence,
belittle, or imply stupidity or incompetence”; (7) “[he]
refused to accept Medical Staff assignments or
participate in committee or departmental affairs on
anything but [his] own terms, and did so in a
disruptive manner’; (8) “{he] made verbal threats of
retribution and litigation towards individuals and
AHA personnel including members of the Medical
Staff’; and (9) “{he] used abusive language.”

On February 24, 2003, the Board of Directors met
and the MEC/Credentials Committee informed the
Board of their recommendation to give Dr. Ware notice
of Termination of his provisional privileges effective
March 18, 2003. The MEC/Credential Committee
further informed the Board of their recommendation to
notify plaintiff of termination of his medical staff

membership effective March 18, 2003.

On March 6, 2003, plaintiff delivered a written
request for a hearing to the Chief Executive Officer of
AHA.* The March 6, 2003 letter advised AHA that
plaintiff had retained counsel to represent his

* Plaintiff requested a hearing in writing within thirty days of
receipt of the February 18, 2003 letter, as provided by the Bylaws.

68a

interests in the matter, and that any questions
regarding scheduling of the hearing should be directed
to the attention of his attorney, Charles Kugler.

By letter dated March 18, 2003, AHA sent plaintiff
a Notice of Hearing stating the place, time, and date of
the Fair Hearing. The letter identified five proposed
members of the Fair Hearing Panel. Pursuant to the
letter, plaintiff was expressly given the right to object
to any of the individuals identified to serve on the Fair
Hearing Panel with whom plaintiff believed he was in
direct economic competition. The letter identified the
specific charges made against plaintiff, and included
an itemized listing of the specific information upon
which the MEC relied in making its recommendation.
The letter also identified the witnesses that would be
requested to testify at the Fair Hearing in support of
the charges against plaintiff.

By letter dated March 21, 2003, plaintiffs legal
counsel acknowledged receipt of the March 18, 2003
letter and made written objections to the composition
of two of the proposed members of the Fair Hearing
Panel.

On June 5, 2003, AHA provided plaintiffs counsel
with all of the written exhibits that would be (and
were) used at the Fair Hearing in support of the
charges against him.*' Subsequent amended notices of
hearing were sent to plaintiff and ultimately the Fair
Hearing was scheduled for January 22, 2004. Plaintiff

*' This particular fact was stipulated to in the Pretrial Order and
will be deemed uncontroverted.

69a

was given a new opportunity to object to the
composition of the Fair Hearing Panel in each
amended notice. Plaintiff was also provided with
another copy of all expected exhibits on January Q,
2004, just prior to the hearing.

The Hearing Panel was composed of five
physicians, only one of whom was from Atchison. At
the Hearing, plaintiff was represented by Charles
Kugler, plaintiffs attorney in this action. The MEC
was represented by Andrew Ramirez. Each party had
the opportunity to present witnesses and offered
testimony to support their case. The witnesses were
crossexamined by the other party. The attorneys
provided statements of their position at the Hearing.
The members of the Fair Hearing Panel were
permitted to ask questions of the parties, the
witnesses, and the attorneys during the Hearing.
Plaintiff presented evidence, including exhibits and
documents to the Fair Hearing Panel. The Fair
Hearing Panel voted to uphold the MEC’s
recommendation to not reappoint plaintiff to the
medical staff. Dr. Mark Lierz, an adult and pediatric
urologist from St. Joseph, Missouri, wrote the report of
the Panel’s findings as Chair of the Panel. Dr. Lierz
noted that plaintiff had “an established pattern of
disruptive behavior that created a poor environment
for hospital personnel, medical staff, paticnts and his
physician colleagues as he was warned on multiple
occasions that this was in direct violation of the
Medical Staff Bylaws.”

An Appeal! Hearing was conducted before the Board
on March 25, 2004. Plaintiff was allowed legal counsel
and to make oral argument at the hearing. On April 2,

70a

2004, the Board issued its written decision and decided
to not reappoint plaintiff to the medical staff, effective
April 2, 2004. The Board’s decision was based on the
recommendation of the MEC and the Hearing Panel.

Between February 18, 2003, when plaintiff received
notice of the MEC’s adverse recommendation, and
April 2, 2004, when tne Board issued its decision on
appeal, plaintiff had maintained active medical staff
privileges at AHA. After his appeal was denied,
plaintiff resigned his other medical staff privileges
with Cushing Memorial and with Horton County
Hospital and decided to relocate to Poplar Bluffs,
Missouri.

III. Discussion

Plaintiff asserts in his Complaint the following
claims: (1) race discrimination under 42 U.S.C. § 1981;
(2) race discrimination under Title VI of the Civil
Rights Act of 1964; (3) conspiracy to discriminate
under 42 U.S.C. § 1985(3); (4) an antitrust violation
under Section 1 of the Sherman Act;* (5) retaliatory
discharge in violation of Kansas public policy; and (6)
intentional interference with business relations under
Kansas law. Defendants assert there is no evidence
creating a genuine issue of material fact on any of
plaintiffs claims and assert various defenses to suit,
including waiver. The Court first addresses the
substantive claims alleged by plaintiff. Then, the
Court will turn to the affirmative defense of waiver.

"15 USC. § 1.

Tla

A. Race Discrimination under Sections
1981 and Title VI

Section 1981, as amended by the Civil Rights Act of
1981, states:

All persons within the jurisdiction of the
United States shall have the same right in
every State and Territory to make and
enforce contracts, to sue, be parties, give
evidence, and to the full and equal benefit off
all laws and proceedings for the security of
persons and property as is enjoyed by white
citizens, and shall be subject to like
punishment, pains, penalties, taxes,
licenses, and exactions of every kind, and to
no other.**

In a similar vein, Title VI of the Civil Rights Act of
1964 provides that no personal shall, “on the ground of
race, color, or national origin, be excluded from
participation in, be denied the benefits of, or be
subjected to discrimination under any program or
activity” covered by Title VI.** “[P]rivate individuals
may sue to enforce § 601 of Title VI and obtain both

* 42 U.S.C. § 1981(a).

“ Pub. L. 88-352, Title VI, § 601, 78 Stat. 252 (codified at 42
U.S.C. § 2000d). The parties have stipulated that AHA is the

recipient of federal financial assistance within the meaning of
Title VI.

72a

injunctive relief and damages.” Title VI only
prohibits intentional discrimination.“

It is undisputed that plaintiff was not an employee
of AHA, nor of the individual defendants. Plaintiffs
legal status in relation to defendants is that of an
independent contractor.*’ Yet, plaintiff formulates the
elements of his Section 1981 claim under the
McDonnell-Douglas Corp. v. Green*® burden-shifting
framework, normally applicable in employment
discrimination cases that involve’ termination.
Defendants object that McDonnell-Douglas is
inapplicable because plaintiff is not an employee.
Defendants also maintain that plaintiff did not have a
contractual relationship with AHA, such that would
allow for a claim under Section 1981.

“In the employment discrimination context, claims
brought pursuant to Section 1981 and Title VI are

*® Alexander v. Sandoval, 532 U.S. 275, 280 (2001).
aa A

*” See, e.g., Shah v. Deaconess Hospital, 355 F.3d 496 (6th Cir.
2004) (applying the common law agency test to determine that
plaintiff surgeon was an independent contractor of the hospital,
in accord with the Fourth, Seventh, and Fifth Circuits);
McPherson v. HCA-HealthOne, LLC., 202 F. Supp. 2d 1156,
1164-68 (D. Colo. 2002) (collecting cases). See generally
Lambertsen v. Utah Dept. of Corr., 79 F.3d 1024, 1028-29 (10th
Cir. 1996) (discussing how to determine employer-employee
relationship for purposes of anti-discrimination statutes).

* 411 U.S. 792 (1973).

73a

governed by the same evidentiary framework as claims
brought under Title VII; that is, in the absence of
direct evidence of discrimination,” the court applies
the burden-shifting scheme of McDonnell-Douglas and
Texas Department of Community Affairs v. Burdine.”
Under this framework, plaintiff must first prove a
prima facie case of race discrimination.” If plaintiff is
able to sustain this burden, the burden of production
shifts to defendants to “articulate a legitimate,
nondiscriminatory reason for rejection.” If defendants
sustain that burden, the burden of production shifts
back to plaintiff to show that defendants’ proffered
reason for rejection is false, or merely a pretext, and
the presumption of discrimination created by
establishing a prima facie case “drops out of the

” Here plaintiff does not appear to argue that direct evidence of
race discrimination is present, as he advocates the McDonnell-
Douglas burden-shifling framework in the Pretrial Order. Yet, in
his sponse, he maintains that certain comments made by
“individuals associated with the Hospital,” constitute direct
evidence of discrimination. As the Court will discuss in more
detail when it evaluates pretext, these stray comments are
insufficient to support a claim of intentional discrimination.

°° 450 U.S. 248 (1981); see Antonio v. Sygma Network, Inc.,
__F.3d__, No. 05-1374, 2006 WL 2361633, at *2 (10th Cir. Aug. 16,
2006); Maldonado v. City of Altus, 433 F.3d 1294, 1307 (10th Cir.
2006); Black Educ. Network, Inc. v. AT & T Broadband, LLC, 154
Fed. App’x 33, 44 (10th Cir. 2005).

°! See Burdine, 450 U.S. at 252-53; McDonnell Douglas Corp.,411
U.S. at 802.

°? See McDonnell Douglas Corp., 411 U.S. at 802.

T4a

picture.” Although the burden of production shifts
back and forth between the parties, the ultimate
burden of persuasion remains at all times with the
plaintiff.”

Despite the fact that these claims do not arise in
the employment context, the Court may still apply the
McDonnell-Douglas test for indirect evidence of
intentional discrimination.” Also, multiple courts
have utilized the McDonnell-Douglas test for
intentional discrimination claims when a physician
makes such a claim against hospital entities for
suspension or termination of staff privileges.”

The Court rejects the formulation of the prima facie
case that plaintiff advocates in the Pretrial Order and,
instead, would apply the elements of a claim under
Section 1981 in the nonemployment context, as
articulated by the Tenth Circuit in Hampton v. Dillard

Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 143
(2000) (quoting St. Mary’s Honor Ctr. v. Hicks, 509 U.S. 502, 511
(1993)).

“ Burdine, 450 U.S. at 253.

°° PAS Commce’ns, Inc. v. Sprint Corp., 139 F. Supp. 2d 1149, 1167
(D. Kan. 2001) (collecting cases supporting use of McDonnell
Douglas in a variety of Section 1981 cases).

® See, e.g., Patel v. Midland Memorial Hosp. & Med. Ctr., 298
F.3d 333, 341-344 (5th Cir. 2002), cert. denied, 537 U.S. 1108
(2003); Jeung v. McKrow, 264 F. Supp. 2d 557, 566-67 (E.D. Mich.
2003); Van v. Anderson, 199 F. Supp. 2d 550, 562-70 (N.D. Tex.
2002), affd, 66 ked. App’x 524 (5th Cir. 2003).

15a

Department Stores, Inc.®’ Plaintiff must show, (1) he is
a member of a protected class; (2) that defendants had
an intent to discriminate on the basis of race; and (3)
the discrimination interfered with a protected activity
as defined in section 1981.°° Plaintiff claims that
defendants interfered with the protected activity of
making and enforcing a contract. It is undisputed that
plaintiff is a member of a protected class. Defendants
seek summary judgment because they argue plaintiff
is unable to prove that he had a contract interest that
defendants interfered with, and further, that there is
no evidence of intentional discrimination.

1. Interference with the Making and
Enforcement of a Contract

Under Section 1981(b), to “make and enforce
contracts” includes: “the making, performance,
modification, and termination of contracts, and the
enjoyment of all benefits, privileges, termss and
conditions of the contractual relationship.” To state a

°' 247 F.3d 1091 (10th Cir. 2001), cert. denied, 534 U.S. 1131
(2002). As the Court has already stated, it is uncontested that
plaintiff is not an employee of AHA, nor any of the individual
defendants. See Bhatt v. Brownsville Gen. Hosp., No. 03-1578,
2006 WL 167955, at *17 n.2 (W.D. Pa. Jan. 20, 2006) (explaining
that the prima facie case for wrongful termination is inapplicable
in a case where the physician is not an employee of the hospital).

58 Hampton, 247 F.3d at 1101; see also Patel, 298 F.3d at 341-44;
Pamintuan v. Nanticoke Memorial Hosp., Inc., No. 96-233-SLR,
1998 WL 743680 (D. Del. 1998), aff'd, 192 F.3d 378 (3d Cir. 1999).
But see Jeung, 264 F. Supp. 2d at 568 (applying a modified prima
facie case).

76a

claim under Section 1981 for interference with a
contract, it must involve, “the actual loss of a contract
interest, not merely the possible loss of future contract
opportunities.””? Although most litigation under
Section 1981 arises from employment discrimination
claims, it has also been applied to claims regarding the
retail sector and the restaurant industry if a contract
is established.

The parties dispute whether the Bylaws created a
contract interest upon which plaintiff may base his
Section 1981 claim.”' Plaintiff points the Court to cases
that he believes show that other courts have allowed
claims under Section 1981 by physicians who are
denied medical staff benefits without proving the
existence of a contract. First, plaintiff points the Court
to Jatoi v. Hurst-Euless-Bedford Hospital Authority,”
where the Fifth Circuit remanded back to the district
court to make specific findings on the elements of the
prima facie case and did not speak to the contract
issue.® Next, plaintiff cites Islami v. Covenant Medical

- Hampton, 247 .F.3d. at 1104.

© Id. at 1102.

© The Court is unclear about why plaintiff insists that he need not
prove he had “vested contract rights.” ‘The Court evaluates this

prong of the prima facie case as whether he had an enforceable
contract interest, as the statute explicitly requires.

© 807 F.2d 1214 (5th Cir. 1987).

8 Id. at 1219.

T7a

Center,” which did not consider a claim under Section
1981, but did find that, under Iowa law, the hospital
bylaws created a contract between the defendants and
the physician plaintiff in the context of a breach of
contract action.” The Supreme Court of Iowa later
disagreed with that holding.® Finally, plaintiffs cite
Janda v. Madera Community Hospital,®*’ which also
found that hospital bylaws created a contract between
the hospital and the physician plaintiff under
California law.”

Neither party identifies, nor is the Court able to
locate, Kansas law on the issue of whether hospital
bylaws create an enforceable contract between the
hospital and its medical staff. The closest the Kansas
Supreme Court has come to answering this question
was in the context of a breach of contract action by a
radiologist who sued a hospital for breach of contract
based on due process provisions in the hospital
bylaws.°? The Kansas Supreme Court declined to
address the issue before this Court, stating: “The

* 822 F. Supp. 1361 (N.D. Iowa 1992).
© Id. at 1370-71.

*° Tredrea v. Anesthesia & Analgesia, P.C., 584 N.W.2d 276,
285-87 (lowa 1998).

®7 16 F. Supp. 2d 1181, 1186 (E.D. Cal. 1998).
(™ Id. at 1188.

©? Dutta v. St. Francis Reg. Med. Ctr., Inc., 867 P.2d 1057, 1062
(Kan. 1994)

78a

threshold issue in Lewisburg was whether the bylaws
formed a contract with the plaintiff radiologist as a
member of the medical staff. St. Francis, in this case
at bar, has admitted to the contractual relationship.”” .
Therefore, the Court must predict how Kansas courts
would resolve the issue.

As discussed in the cases cited by plaintiff, there is
a split of authority outside of the jurisdiction.”' It is
also difficult to discern a general rule from these cases.
Plaintiff quotes Corpus Juris Secundum for the
proposition that “a hospital’s medical staff bylaws
constitute a contract between the hospital and its
medical staff, particularly where the hospital and its
staff indicate an intent to be bound by their terms, but
not otherwise.””” But the revised version of this section

states that there is also authority that “absent express
language to the contrary, a hospital’s medical staff
bylaws do not constitute a contract between the
hospital and its staff physicians, since the essential

element of valuable consideration is absent.””

” Id. (discussing Lewisburg Comm’y Hosp. v. Alfredson, 805
S.W.2d 756 (Tenn. 1991)).

” See Janda, 16 F. Supp. 2d at 1184—85 (collecting cases); Islami,
822 F. Supp. at 1370 (same); Rahimi v. St. Elizabeth Med. Ctr.,
Inc., No. C3-96-126, 1997 WL 33426269, at *5-—-7 (S.D. Ohio July
16, 1997); Kessel v. Monongalia County Gen. Hosp., 600 S.E.2d
321, 326 (W. Va. 2004); Tredrea, 584 N.W.2d at 285-87.

” 41 C.J.S. Hospitals § 16 (1991).

** 41 C.J.S. Hospitals § 27 (2006).

79a

The Court concludes that the better-reasoned line
of cases hold that hospital bylaws do not create a
contract. Like the bylaws discussed in Tredrea, the
Bylaws here do not imply an agreement for continued
staff privileges. In fact, the Bylaws explicitly provide
that medical staff privileges are not a right and that
staff members have no entitlement to continued staff
privileges.

The preamble to the Bylaws state:

the physicians and dentists practicing at
Atchison Hospital Association, . . . hereby
organize themselves in conformity with these
Bylaws, which establish the mechanisms to
carry out the direct and delegated
responsibilities of the Medical Staff in
cooperation with the Hospital Administration
and the Governing Board of the Hospital, and
do hereby agree to accept and abide by the
following Bylaws and _ such Rules and
Regulations which are adopted in accord with
these Bylaws.

The Court finds that these Bylaws do not create a
contract between physicians and the hospital. AHA
gave no consideration for any agreement created by
the Bylaws, despite the fact that plaintiff was required
to abide by them as a consequence of medical staff
privileges. Further, the Bylaws are required to be

4

passed by state regulation,’* so AHA is merely

See K.A.R. 28-34-5a(b).

80a

complying with the law in promulgating Bylaws.” The
Court finds, like the Supreme Court of Iowa, that
construing medical staff bylaws as a contract could
actually be contrary to-public policy:

[W]e believe it would improperly impinge on the
statutory mandate to the board of directors to
establish criteria for staff privileges, perpetuate
the problems that had led to the establishment
of the independent contractor system, and
ultimately affect the successful operation of the
hospital. Such a contract, impacting as it would
on the statutory responsibilities of the hospital
on matters affecting staff qualifications, might
well be argued to be against public policy. In
any event, we conclude that continued staff
privileges are not implied by the bylaws, and we
will not give the bylaws the effect of a contract.”

The Court agrees with the reasoning of the
Supreme Court of Iowa. This Court predicts that under
Kansas law, the bylaws do not constitute a contract
between. medical staff and the hospital. There is a lack
of consideration, lack of intent to be bound, and it is
contrary to public policy to take away the authority of
the Governing Board as “the ultimate authority in the
hospital.”’’ Accordingly, the Court finds that plaintiff

5 See Kessel vu. Monongalia County Gen. Hosp. Co., 600 S.E.2d 32,
326 (W. Va. 2004); Tredrea, 584 N.W.2d at 285.

% Tredrea, 584 N.W.2d at 287.

” K_A.R. 28-34-5(a); see Doc. 163, Ex. 4a at 29 (“The Governing
Board of the Hospital shall have the ultimate authority in

8la

is unable to establish a genuine issue of material fact
over the third element of a prima facie case, which
requires him to show that defendants interfered with
the making or enforcement of a contract.

2. Pretext

Assuming arguendo plaintiff is able to satisfy the
prima facie elements of a Section 1981 and Title VI
claim, defendant must offer a_ legitimate,
nondiscriminatory reason for the discrimination.
Defendants argue that they abided by the peer review
process according to the Bylaws in denying plaintiffs
application for reappointment in 2003 because he was
a disruptive physician. Plaintiff, in turn, argues that
this reason is simply a pretext for discrimination.

The Court finds that defendants offer legitimate,
non-discriminatory reasons for denying plaintiffs
application for reappointment, and proceeds _ to
determine if this act was a pretext for discrimination.
“A plaintiff can show pretext by revealing such
weaknesses, implausibilities, inconsistencies,
incoherencies, or contradictions in the employer's
pr

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386020_1230%3A2. Public record. Not legal advice.