The opinion of the court was delivered by: METZNER
Julia L. Butterfield Memorial Hospital and the individual defendants move pursuant to Rule 12(b)(6), Fed. R. Civ. P., to dismiss the complaint for failure to state a claim upon which relief can be granted.
The plaintiffs are two physicians duly licensed by the State of New York. The defendant hospital is a private, nonprofit hospital incorporated under the laws of New York and located in the Village of Cold Spring, New York. The individual defendants comprise the board of directors and board of trustees of the hospital.
The plaintiffs are specialists in internal medicine. They were members of the medical staff of the hospital for the year 1969 and as such were entitled to the use of the hospital's facilities for their patients. The Executive Committee of the Medical-Dental Staff of the hospital voted not to reappoint plaintiffs for the year 1970. This action was taken without notice to the plaintiffs or an opportunity to be heard. However, the procedures followed were in accordance with the bylaws of the hospital.
The plaintiffs claim that they have been denied equal protection of the laws and have been deprived of procedural due process by their discharge without notice or a hearing. Jurisdiction is asserted under 28 U.S.C. §§ 1331, 1343, 2201 and 2202. The relief sought is a declaratory judgment, a permanent injunction, reinstatement of plaintiffs to the hospital medical staff, and damages totaling $100,000 to each plaintiff.
The equal protection claim can be disposed of summarily. The plaintiffs nowhere assert that other doctors were given hearings before being denied reappointment or that it was the custom or policy of the hospital to give hearings. Therefore no denial of equal protection can be claimed, and insofar as plaintiffs' complaint is based on such a denial, it is dismissed.
The allegation that plaintiffs have been denied due process, however, creates a more difficult problem. The question is not, as defendants would have us believe, whether a doctor can ever be discharged from a hospital; the question is rather when a hospital will be required to afford a doctor the protections of procedural due process in deciding whether or not to sever him.
A private hospital is subject to the precepts of the Fourteenth Amendment only if its actions are tinged with some measure of state involvement. It is an uncontroverted principle that the action inhibited by the due process clause of the Fourteenth Amendment is only such action as may be said to be that of the states. The Civil Rights Cases, 109 U.S. 3, 3 S. Ct. 18, 27 L. Ed. 835 (1883). Private conduct abridging individual rights does not violate the Fourteenth Amendment "unless to some significant extent the State in any of its manifestations has been found to have become involved in it." Burton v. Wilmington Parking Authority, 365 U.S. 715, 722, 81 S. Ct. 856, 860, 6 L. Ed. 2d 45 (1961).
The question, therefore, becomes whether the State of New York is so associated with the conduct of Julia L. Butterfield Memorial Hospital that the hospital's action in discharging the two plaintiffs can be considered the action of the state.
There is no precise formula for determining whether state action is present. The influence and actions of the state permeate almost every phase of our lives. "In a sense, almost everything we do is in part the product of or is facilitated by some State action." Commonwealth of Pennsylvania v. Brown, 270 F. Supp. 782, 788 (E.D. Pa. 1967), aff'd, 392 F.2d 120 (3d Cir.), cert. denied, 391 U.S. 921, 88 S. Ct. 1811, 20 L. Ed. 2d 657 (1968). "Only by sifting and weighing circumstances can the non-obvious involvement of the State in private conduct be attributed its true significance." Burton v. Wilmington Parking Authority, supra, 365 U.S. at 722, 81 S. Ct. at 860. Our inquiry must be directed at the whole course of conduct of the state with respect to the institution in question so as to determine how far the state has "insinuated itself" into a position of joint participation in the challenged activity. Burton v. Wilmington Parking Authority, supra at 725, 81 S. Ct. 856.
In the present case the plaintiffs assert that the requisite state involvement is found in the fact that Julia L. Butterfield Memorial Hospital received construction funds pursuant to the Hill-Burton Act, 42 U.S.C. § 291 et seq., and is subject to detailed regulation by the State of New York.
The Hill-Burton Act provides federal grants to state agencies to assist in creating statewide systems of hospital care to reach all the people of a state. The program was designed to induce the states to assume, as a state function, the burden of supervising the maintenance and construction of hospitals throughout the state. Simkins v. Moses H. Cone Memorial Hospital, 323 F.2d 959, 968 (4th Cir.), cert. denied, 376 U.S. 938, 84 S. Ct. 793, 11 L. Ed. 2d 659 (1964). The money is funneled through the state agencies to individual hospitals which are engaged in building projects. A state, in order to qualify for funds, must have a statewide plan of hospital construction approved by the Surgeon General of the United States.
Participation in the Hill-Burton program subjects the hospital to an elaborate pattern of state and federal regulation. The hospital is required to meet minimum standards of operation and maintenance, which are enforced by the state. The Act provides for federal decision as to the number of hospital beds and other facilities required to provide adequate service in a state; and state allowances in terms of the number of beds per thousand population have been fixed by regulation, as have the methods to be used by state agencies in distributing hospitals in a state.
Furthermore, all hospitals in New York State, whether or not participants in the Hill-Burton program, are subject to intricate state regulation pursuant to the New York Public Health Law § 2800 et seq., McKinney's Consol. Laws, c. 45. State approval is required for incorporation or construction of a hospital. There are limitations on ownership and on solicitation of funds for hospitals. A hospital is required to admit all patients needing immediate care regardless of ability to pay. The state has the right to inspect hospitals, to establish rate schedules and operating standards, and to dictate ...