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SIMPKINS v. SHALALA

March 31, 1998

CUTHBERT O. SIMPKINS, M.D., Plaintiff,
v.
DONNA E. SHALALA, Secretary of Health & Human Services, et al., Defendants.



The opinion of the court was delivered by: LAMBERTH

 This matter comes before the court on the defendants' motion to dismiss or, in the alternative, for summary judgment, and the plaintiff's cross-motion for summary judgment.

 Summary judgment is appropriate when there is "no genuine issue as to any material fact and . . . the moving party is entitled to judgment as a matter of law." FED. R. CIV. P. 56(c). This case is proper for summary judgment as it does not present any disputed issues of material fact. For the reasons set forth below the court grants the plaintiff's motion for summary judgment in part and denies it in part. The defendants' motion to dismiss or, in the alternative, for summary judgment is likewise granted in part and denied in part.

 I. Background

 Plaintiff Cuthbert O. Simpkins, M.D., is a former medical officer at the District of Columbia General Hospital ("D.C. General"). This suit arises out of a series of events occurring during plaintiff's employment at D.C. General and the hospital's subsequent report of these events to federal authorities.

 1. The Prior Related Lawsuit and Procedural Posture of this Case

 Before addressing the specific issues before the court and the factual circumstances out of which they arise, it may be useful to review the procedural posture of this case and the prior suits involving these and other associated parties.

 On or about August 24, 1992, plaintiff filed a civil action in the Superior Court for the District of Columbia against the District of Columbia, four D.C. General officials, the National Practitioner Data Bank ("Data Bank"), and Louis W. Sullivan, M.D., who had been the Secretary of the United States Department of Health and Human Services ("HHS") at the time of the report. Plaintiff alleged breach of contract, deprivation of procedural and substantive due process, libel and slander, intentional infliction of emotional distress, constructive discharge, civil conspiracy, and violations of federal law in connection with D.C. General's report to the Data Bank. The federal defendants subsequently removed the case to this court and the United States substituted itself for the Secretary of HHS on the common law tort claims. The Secretary remained a defendant to the extent the complaint asserted constitutional tort claims against the Secretary. *fn1" This court granted the joint motion of the United States and the Secretary of HHS to dismiss under FED. R. CIV. P. 12(B)(6), dismissing all the claims against these defendants with prejudice. Simpkins v. District of Columbia Government ("Simpkins I"), Civil Action No. 92-2119 (RCL), Memorandum Opinion and Order (D.D.C. July 7, 1994), aff'd in part rev'd in part, 323 U.S. App. D.C. 312, 108 F.3d 366 (D.C. Cir. 1997). This court dismissed the claims against the Data Bank without prejudice for failure to prosecute. Id. In light of the dismissal of the federal parties, this court also declined to exercise supplemental jurisdiction over the rest of the case and so those claims were dismissed without prejudice. Id.

 While an appeal of Simpkins I was pending, plaintiff filed the present action against the Secretary of HHS and HHS, later amending his complaint to add the Data Bank as a defendant. In this case, plaintiff alleges several violations of law, asserting that these violations should result in removal of D.C. General's Adverse Action Report from the Data Bank, either by order of this Court or, in the alternative, upon remand to the administrative agency administering the Data Bank, HHS. On October 5, 1995, defendants filed a renewed motion to dismiss or, in the alternative, for summary judgment, contending that plaintiff's claims were barred by res judicata and that the plaintiff's claims lacked substantive merit. The decision of the United States Court of Appeals for the District of Columbia Circuit ("D.C. Circuit") in Simpkins v. District of Columbia Government ("Simpkins II"), 323 U.S. App. D.C. 312, 108 F.3d 366 (D.C. Cir. 1997), holding that certain claims against the federal defendants should have been dismissed without prejudice instead of with prejudice, eliminated the grounds for defendants' res judicata argument, see 108 F.3d at 370-371, and defendants therefore withdrew this argument. Nevertheless, defendants continue to maintain that plaintiff's arguments lack substantive merit.

 2. The Facts

 On October 4, 1991, D.C. General submitted an Adverse Action Report concerning plaintiff Simpkins to the Data Bank, which is administered by HHS pursuant to the Health Care Quality Improvement Act of 1986 ("HCQI Act"), 42 U.S.C. § 11101 et seq. The Data Bank was established by Congress to address the problems that can result when doctors who are identified by their peers as being incompetent or unprofessional are able to move and continue their medial careers without anyone being aware of their previous incompetence or unprofessional actions. 42 U.S.C. § 11101(1) & (2).

 The Adverse Action Report submitted to the Data Bank by D.C. General indicated that Dr. Simpkins resigned his staff privileges at D.C. General during a review of his quality of care. Plaintiff disputed the accuracy of the report and requested review by the Secretary of HHS. Following that review, the Secretary determined that the report was accurate. Plaintiff was permitted at that time to submit a statement indicating his dispute with the Adverse Action Report, and plaintiff did so.

 3. The Issues

 Plaintiff's amended complaint contains five counts. Plaintiff charges that defendants have violated the Administrative Procedure Act (Count One), the HCQI Act (Count Two), and the Fifth Amendment to the United States Constitution (Count Three). Plaintiff also contends that defendants have libeled him (Count Four) and tortiously interfered with plaintiff's contractual, economic, and business relations (Count Five). All of plaintiff's charges arise from HHS' decision to include the D.C. General Adverse Action Report concerning plaintiff Simpkins in the Data Bank.

 II. Discussion

 A. The Administrative Procedure Act

 The Court shall first consider plaintiff's allegations under the Administrative Procedure Act ("APA"), 5 U.S.C. §§ 501 et seq. Plaintiff argues that the defendants' actions with regard to the Adverse Action Report were "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." 5 U.S.C. § 702(2)(A). Plaintiff claims that HHS's review of the Adverse Action Report was improper, and that a more thorough examination by HHS would have revealed that neither of the predicate conditions for a Data Bank report, as established by Section 11133 of the HCQI Act, were present. Defendants respond that judicial review of HHS's actions under the APA is highly deferential and that HHS's obligations under the HCQI Act are narrow and limited.

 Defendants correctly point out that judicial review of administrative action under the APA is limited to the administrative record before the agency at the time the agency issues its decision. See Camp v. Pitts, 411 U.S. 138, 142-43, 36 L. Ed. 2d 106, 93 S. Ct. 1241 (1973). Defendants assert that under the APA the "standard of review is a highly deferential one, which presumes the agency's action to be valid." Environmental Defense Fund, Inc. v. Costle, 211 U.S. App. D.C. 313, 657 F.2d 275, 283 (D.C. Cir. 1981)(citations omitted). Nevertheless, the D.C. Circuit in Costle also asserted:

 
We must be assured that the agency action was "based on a consideration of the relevant factors," and that "the agency has exercised a reasoned discretion, with reasons that do not deviate from or ignore the ascertainable legislative intent." Our inquiry into the facts must also be searching and careful.

 Applying these principles of law to the present dispute, this court must consider plaintiff's claim that HHS acted arbitrarily and capriciously in concluding that the information contained in D.C. General's Adverse Action Report should be entered into the Data Bank. Defendants firmly adhere to their administrative action, arguing:

 
Plaintiff had resigned from his position at the hospital, such action by a physician normally implies a surrender of clinical privileges, and plaintiff presented no evidence to indicate that he was still willing to practice medicine at D.C. General despite the hospital's report to the contrary. In addition, the documentation submitted to HHS by plaintiff, taken as a whole, indicated that an investigation concerning plaintiff's professional competence was being conducted by D.C. General at the time plaintiff resigned, and was discontinued only because of plaintiff's resignation.

 Defendants Consolidated Reply Memorandum and Opposition To Plaintiff's Cross-Motion For Summary Judgment ("Def. Mem.") at 8.

 Section 11133 of the HCQI Act requires a report to the Board of Medical Examiners by "each health care entity which . . . (B) accepts the surrender of clinical privileges of a physician (i) while the physician is under an investigation by the entity relating to possible incompetence or improper professional conduct, or (ii) in return for not conducting such an investigation or proceeding . . . ." 42 U.S.C. § 11133(a)(1). The Board of Medical Examiners is required to submit this information to the Secretary or in the Secretary's discretion, to an appropriate private or public agency. See 42 U.S.C. § 11134.

 Defendants appear to argue that they did not need to review the accuracy of the information submitted to the Data Bank. The defendants phrase this argument as support for the contention that plaintiff was given meaningful notice or opportunity to contest his listing in the Data Bank. Nevertheless, this court disagrees with the implication of defendants' argument, namely that the Secretary could resolve all concerns about a Data Bank report by simply "noting that a dispute exists about the accuracy of the information and including a brief statement by the physician or practitioner setting forth the disagreement regarding the information." Def. Mem. at 9 (citing H.R. Rept. No. 903, 99th Cong., 2nd Sess., at 19, reprinted in 1986 U.S. Code Cong. & Admin News at 6402). As defendants recognize, the HCQI Act requires HHS to establish procedures to govern disputes concerning the accuracy of information contained in the Data Bank. 42 U.S.C. § 11136(2). Pursuant to this requirement, HHS issued 45 C.F.R. § 60.14, which describes how to dispute the accuracy of Data Bank information. These regulations provide that if the reporting entity does not revise the reported information, the Secretary will, upon request, review the written information submitted by both parties, and if the Secretary concludes that the information was incorrect, send corrected information to previous inquirers. See 45 C.F.R. § 60.14. This indicates that in certain circumstances the Secretary's duties under the HCQI Act are broader than the defendants imply.

 Moreover, this court is convinced that regardless of what HHS's obligations may or may not be to review whether a reporting entity acted correctly in a peer review action or an entity's investigation of a doctor, it has a duty to determine whether the events that transpired should have resulted in a Data Bank Report. Imagine a situation in which an entity suspends a doctor's clinical privileges and then files a subsequent report. Surely there is a difference between requiring HHS to review whether the health care entity acted correctly in suspending the doctor and requiring HHS to review whether the entity in fact suspended the doctor. In this case, HHS had a duty to review whether Dr. Simpkins' resignation and D.C. General's actions with regard to Dr. Simpkins triggered D.C. General's reporting responsibilities under the HCQI Act.

 1. Did Plaintiff Surrender his Clinical Privileges Within The Meaning of 42 U.S.C. 11133(1)(b)?

 Turning to plaintiff's contentions under the APA, Dr. Simpkins first asserts that HHS incorrectly determined that his voluntary resignation from staff membership constituted the "surrender of clinical privileges of a physician" within the meaning of 42 U.S.C. 11133(1)(b). The defendant replies that there is no meaningful distinction between the resignation of plaintiff's employment and the surrender of his clinical privileges, arguing that in this case, the plaintiff's clinical privileges were co-extensive with his employment.

 An initial matter requiring resolution is whether this issue was presented to the agency for review. Although the defendant does not directly discuss this issue in its submissions to the court, *fn2" the Declaration of Mr. Croft indicates that Dr. Simpkins did not dispute the status of his clinical privileges following his resignation from the hospital and that therefore HHS did not have an opportunity to review these allegations prior to the filing of Dr. Simpkins' current action. Croft Dec. at P22. Due to the limited nature of judicial review of administrative action under the APA, plaintiff was required to present this issue to HHS at the time it issued its decision. See Camp v. Pitts, 411 U.S. 138, 142-43, 36 L. Ed. 2d 106, 93 S. Ct. 1241 (1973).

 After considering the record before the agency at the time it issued its decision, the court is convinced that plaintiff presented this contention to HHS for review. In her September 3, 1991 letter to D.C. General, plaintiff's prior counsel argued that "Dr. Simpkins' voluntary resignation from staff membership did not constitute a 'surrender of clinical privileges of a physician'" under the HCQI Act. McDonald Letter, Plaintiff's Exhibit 19. In Mr. Croft's August 28, 1997 Deposition, he concedes that this letter was included as Exhibit 5 to Dr. Simpkins' April 6, 1994 letter to the Secretary. Croft Dep. at 13-15. As a result, this court is convinced that the issue was presented for review.

 Next, this court must consider whether HHS acted arbitrarily and capriciously in deciding this issue. Plaintiff argues that despite his resignation of employment at D.C. General, he continued to have clinical privileges at D.C. General by virtue of his faculty position at Howard University. Plaintiff argues that although he resigned his employment at D.C. General, he never surrendered his clinical privileges at the hospital. Plaintiff also contends that the lack of proper notation in plaintiff's D.C. General credentialling file indicates that he did not surrender his clinical privileges. Although plaintiff persuasively argues that D.C. General did not eliminate or revoke his clinical privileges, plaintiff has not adequately shown that his resignation did not result in the surrender of his clinical privileges within the meaning of ...


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