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Morman v. Campbell County Mem. Hosp.

United States District Court, D. Wyoming

December 5, 2014

MONICA MORMAN, M.D., an individual, Plaintiff,
v.
CAMPBELL COUNTY MEMORIAL HOSPITAL, ROBERT MORASKO, SARA HARTSAW, M.D., NANCY TRAVER, HARVEY JACKSON, JOE HALLOCK, ALAN L. MITCHELL, M.D., GEORGE DUNLAP, and BROOK BAHNSON, in their individual and official capacities, Defendants

For Dr Monica Morman, Plaintiff: Gary R Guelker, Janet Jenson, LEAD ATTORNEYS, PRO HAC VICE, JENSON & GUELKER PLLC, Salt Lake City, UT; Mary Maury Dunn, LEAD ATTORNEY, Casper, WY.

For Campbell County Memorial Hospital, Cambell County Memorial Hospital Chief Executive Officer, also known as Robert Morasko, Robert Morasko, individually, MD Sara L Hartsaw, individually, Campbell County Memorial Hospital Board of Trustees Member, also known as Sara L Hartsaw, Nancy Tarver, individually, Campbell County Memorial Hospital Board of Trustees Member, also known as Nancy Tarver, Harvey K Jackson, individually, Campbell County Memorial Hospital Board of Trustees Member, also known as Harvey K Jackson, Joe Hallock, individually, Campbell County Memorial Hospital Board of Trustees Member, also known as Joe Hallock, MD Alan A Mitchell, individually, Campbell County Memorial Hospital Board of Trustees Member, also known as Alan A Mitchell, George Dunlap, individually, Campbell County Memorial Hospital Board of Trustees Member, also known as George Dunlap, Brook Bahnson, individually, Campbell County Memorial Hospital Board of Trustees Member, also known as Brook Bahnson, Defendants: Bradley T Cave, LEAD ATTORNEY, HOLLAND & HART, Cheyenne, WY.

OPINION AND ORDER GRANTING DEFENDANTS' MOTION TO DISMISS

Alan B. Johnson, United States District Judge.

Defendants' " Motion to Dismiss" (Doc. No. 8), Plaintiff's opposition (Doc. No. 12), and Defendants' reply (Doc. No. 14) have come before the Court for consideration. After reviewing the parties' submissions, the applicable law, and being fully advised, the Court finds that the motion should be GRANTED for the reasons stated below.

BACKGROUND

On October 25, 2013, Plaintiff filed a Complaint alleging a claim for relief under 42 U.S.C. § 1983. Doc. No. 1. On January 27, 2014, Defendants filed a Motion to Dismiss pursuant to Fed. R. Civ. Pro. 12(b)(6). Doc. No. 8. Plaintiff responded to the motion on February 13, 2014. Doc. No. 12. Defendants filed their reply on February 20, 2014. Doc. No. 14. The Court finds that these matters are fully brief and are ripe for disposition.

On November 24, 2014, Plaintiff filed a Petition for Writ of Mandamus with the Tenth Circuit Court of Appeals. Doc. No. 17. The Tenth Circuit has not yet ruled on Plaintiff's petition.

STANDARD OF REVIEW

In Ashcroft v. Iqbal, the Supreme Court articulated a two-step approach for district courts to use when considering a motion to dismiss under Fed.R.Civ.P. 12(b)(6). See 556 U.S. 662, 679, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). First, " a court considering a motion to dismiss can choose to begin by identifying pleadings that, because they are no more than conclusions, are not entitled to the assumption of truth." Id. Iqbal clarified that " the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions, " and " [t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Id. at 678.

Second, " [w]hen there are well-pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief." Id. at 679. The Court has stated that " [t]o survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face." Id. at 678. " A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. Plausibility lies somewhere between possibility and probability; a complaint must establish more than a mere possibility that the defendant acted unlawfully but the complaint does not need to establish that the defendant probably acted unlawfully. See id. " Determining whether a complaint states a plausible claim for relief will . . . be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. at 679.

DISCUSSION

In her Complaint, Plaintiff, Dr. Monica Morman, alleged the following: Plaintiff is a board-certified orthopedic surgeon who specializes in upper extremity surgeries. Plaintiff graduated from medical school in 1997. Plaintiff completed her orthopedic surgery residency in 2002. Plaintiff became board-eligible (American Board of Orthopaedic Surgery) in 2002 and became board-certified (American Board of Orthopaedic Surgery) in orthopaedic surgery in 2005. Plaintiff completed a hand-surgery fellowship in 2003 and received her Certification of Additional Qualification (CAQ) in hand surgery in 2008. Plaintiff also completed a shoulder fellowship in 2009.

In 2003, Plaintiff became employed as an orthopedic surgeon at Powder River Orthopedics & Spine, P.C. (PROS), located in Gillette, Wyoming. At the time, PROS was owned by four orthopedic surgeons, Drs. Nate Simpson, Hans Kioschos, John Dunn, and Gerald Baker. In 2008, Plaintiff was offered a shoulder fellowship at Massachusetts General Hospital with the Harvard Shoulder Service. The Fellowship was to commence in August 2008 and be completed in July 2009. Plaintiff accepted the fellowship and terminated her employment and partnership with PROS in June 2008.

Upon completion of her shoulder fellowship, Plaintiff returned to Gillette, Wyoming to resume her practice as an orthopedic surgeon. However, instead of returning to PROS, Plaintiff decided to become an employee of Campbell County Memorial Hospital (CCMH). As a result, Plaintiff alleges she " became a direct competitor of the PROS physicians." Doc. No. 1., p. 4.

On September 1, 2009, CCMH and Plaintiff entered into an employment agreement. Under the terms of this agreement, Plaintiff was to receive both a base salary and bi-annual bonus payments that were based on her productivity. Specifically, Plaintiff was to receive a bonus payment equal to fifty-five percent (55%) of all gross collections that CCMH received for Plaintiff's services in excess of $450, 000.00 during each bonus period.

After entering into the agreement, Plaintiff began working in CCMH's orthopedic clinic. Plaintiff alleges that " [f]rom the beginning, CCMH has operated the orthopedic clinic in a manner that has placed [her] at a competitive disadvantage with the surgeons at PROS." Id. at 4. Plaintiff alleged six examples of CCMH's poor management of the clinic.

First, soon after Plaintiff's employment began, CCMH changed the name of the clinic from " Orthopedic Specialists of Wyoming-a CCMH Clinic" to " Campbell County Clinic -- Orthopedics." Plaintiff objected to the use of the phrase " County Clinic" because county hospitals and clinics are often associated with free clinics for the indigent with substandard care. Plaintiff further alleged that given the large number of newcomers to Campbell County who are unfamiliar with CCMH and its history, the decision to change the name of the clinic caused many potential patients to choose the PROS physicians over her. In addition to the name change, Plaintiff's unique logo was exchanged for the branding of the Campbell County Clinics. Plaintiff alleges that " [s]ince their employment in 2012, the physicians of Powder River Orthopedics and Spine have been allowed to maintain the name of their private practice as well as the logo of their private practice." Id. at 5.

Second, Plaintiff is not allowed to self-manage or participate in the management of the clinic and selection of staff. CCMH employed and continues to employ clinic staff who Plaintiff has asked to be terminated or transferred. Plaintiff alleges that by refusing to allow her to select and manage her clinic staff, " CCMH has caused some patients and their family members to choose the PROS physicians for their future orthopedic care." Id.

Third, CCMH refused to hire a full-time office manager for the clinic. As a result, the clinic's shared office manager was often away from the clinic and unable to supervise staff, timely respond to patients, or otherwise perform her administrative duties effectively. Plaintiff's alleges " [t]his caused the clinic to become unorganized and inefficient, which in turn caused some patients to choose the physicians at PROS because PROS is able to present itself and operate in a much more professional manner." Id. Eventually, an orthopedic clinic supervisor was named but was not given the same autonomy as other clinic managers.

Fourth, CCMH has not provided effective advertising for Plaintiff or the orthopedic clinic, despite being contractually obligated to do so. Plaintiff alleges that " [t]his is in contrast to PROS, which has always advertised heavily for its physicians." Id. at 6.

Fifth, CCMH has not provided the clinic with its own onsite billing personnel. Id. Rather, CCMH uses a central billing office which employs billing coders for all of the hospital's various clinics. Plaintiff alleged that " [b]y not allowing the orthopedic clinic to oversee its own billing and collections, CCMH has caused the clinic to lose money through improper billings and, at times, the failure to bill at all for some procedures." Id. Furthermore, Plaintiff alleged " [t]his is in contrast to PROS, which had its billing and collections staff located directly in its clinic under the direct supervision of the PROS' [sic] physicians." Id.

Finally, CCMH failed to provide adequate office space for the clinic. Plaintiff alleges that " [i]nstead of creating a modem and comfortable office space that is inviting to patients, CCMH has located the clinic in various spaces that are not sufficient for the practice." Id. at 7. Furthermore, " the office spaces have not been inviting to patients because they create a crowded, disorganized appearance." Id. Plaintiff made a number of requests to CCMH to address the issue of inadequate office space and those requests were substantially ignored or disregarded. Plaintiff alleges that the " inadequate office space has caused some patients to choose the physicians at PROS over [her] for their orthopedic needs because PROS is located in a spacious, comfortable and organized office space which creates a more professional appearance." Id.

Plaintiff attempted to resolve all of the foregoing problems by discussing proposed changes with CCMH's chief executive officer, Robert Morasko. She has also addressed the CCMH's Board of Trustees at their monthly public meetings and has written letters to the individual Board Members. However, Mr. Morasko and CCMH's Board of Trustees ignored Plaintiff's proposals and refused to make any significant changes to the manner in which CCMH managed the clinic.

As a result of the failure to adequately manage the clinic, Plaintiff alleges that she was placed " at a competitive disadvantage with her competitors at PROS" and as a result " CCMH has reduced the amount of revenue that [she] is able to generate for the hospital." Id. at 7. By placing her at a competitive disadvantage, the bonus payments Plaintiff would have been able to earn under her employment agreement were reduced.

On December 1, 2011, Plaintiff and CCMH renegotiated the employment agreement after a dispute arose over the value of the bonus payments. Under the new agreement, Plaintiff was still entitled to a base salary and bi-annual bonus payments. The new agreement increased the amount of Plaintiff's base salary and contained a higher threshold of revenue that Plaintiff would have to reach to maintain her base salary before she earned her bonus. In contrast, the physicians of PROS are not held to a certain collection level to maintain their current base salary. No other employed surgeons with base salaries at the same or higher percentiles are held to a threshold of revenue to maintain their current base salary.

Plaintiff's contract renegotiation with CCMH was well publicized by CCMH's Board of Trustees and its CEO. The amount of her compensation was reported to local newspapers and was the subject of public opinion articles for several months. The publicity was emotionally taxing and embarrassing for Plaintiff. ...


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