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Mahmud v. Kaufmann

September 27, 2006


The opinion of the court was delivered by: Conner, Senior D.J.



Plaintiff Saeeda A. Mahmud, M.D., brings this action against defendants Walter Kaufmann, M.D., Jeff Auerbach, M.D., Jane Brooks, M.D., Gopal Shah, M.D., and David Brody, M.D., (collectively "defendants") arising from the denial of her medical staff privileges at Bon Secours Community Hospital (the "Hospital"). Plaintiff alleges that defendants failed to renew her contract of affiliation with the Hospital and thwarted her efforts to contract with Orange Regional Medical Center ("ORMC") in violation of 42 U.S.C. § 1981 and the New York Human Rights Law ("NYHRL"), New York Executive Law § 290, et seq. Plaintiff also asserts an antitrust claim under the Sherman Act, 15 U.S.C. § 1, et seq., and New York General Business Law § 340. In addition, plaintiff raises common law claims for interference with prospective economic advantage and prima facie tort. Presently before the Court are defendants' motion to dismiss plaintiff's Complaint pursuant to FED. R. CIV. P. 12(b)(6) for failure to state a claim, and plaintiff's motion to amend her Complaint. For the reasons stated herein, plaintiff's motion to amend is granted and her Amended Complaint is considered subject to defendants' motion to dismiss, which is granted in part and denied in part. It is granted with respect to the third cause of action under NYHRL and the claims for prima facie tort, but denied with respect the § 1981 claims, the fourth cause of action under NYHRL, the antitrust claims under the Sherman Act and the New York General Business Law and the claim for tortious interference with prospective economic advantage.


The following facts are what could best be gleaned from plaintiff's Amended Complaint, which conveys less than a clear understanding of the facts in the case. We note that the Amended Complaint in this action bears a striking similarity to the Complaint filed in a previous action involving this plaintiff and some of these defendants, which was dismissed by this Court without prejudice and with leave to amend. See Mahmud v. Bon Secours Charity Health Sys., 289 F. Supp. 2d 466, 468-69 (S.D.N.Y. 2003) (Conner, J.)

Plaintiff, a native of Pakistan with an Islamic religious background, is board certified in internal medicine. (Am. Complt. ¶¶ 6, 8.) In or about 1996, plaintiff relocated from New York, New York to Port Jervis, New York to take over the practice of Dr. Kruluwitz*fn1 , a retiring pulmonologist (the "practice"). (Id. ¶ 9.) Dr. Kruluwitz sold his practice to the Hospital, who resold it to plaintiff. (Id.)

In contemplating the move, plaintiff met with Dr. Bluett, the then Medical Director of Mercy Hospital.*fn2 (Id. ¶ 9.) Plaintiff perceived Dr. Bluett to be a representative of the Hospital, who was speaking on its behalf. (Id.) Plaintiff questioned Dr. Bluett on the Hospital's need for cardiologists*fn3 and received assurances that, although Kaufmann was the only cardiologist in the Port Jervis area, there was a need for an additional cardiologist and her move would be beneficial to all concerned. (Id. ¶¶ 10, 11.) According to plaintiff, Bluett warned her that Kaufmann had a "monopoly" on all cardiac tests administered at the Hospital, but, in an attempt to induce her to take over Kruluwitz's practice, Bluett assured her that he would change this arrangement. (Id. ¶¶ 11, 12.) Kaufmann also, apparently, promised plaintiff that he would allow her to read her own patient's cardiac tests administered at the Hospital;*fn4 however, once she began working, he sought to review all of her work. (Id. ¶ 13.) In addition, Bluett, "[a]s an inducement to buy the practice," allegedly promised plaintiff office space directly across from the Hospital. (Id. ¶ 14.) Plaintiff claims that she relied on these promises and representations in deciding to pass up other opportunities for cardiology practices and purchased the practice from the Hospital for $40,000. (Id. ¶¶ 14, 15.)

Defendants, all doctors affiliated with the Hospital, have, according to plaintiff, "de facto control" of the Hospital through a mutually agreed upon rotation of influential positions, which include: Chief of Staff, Medical Director and Chief of Medicine, in addition to chairing the Credentials, Medical Examinations and Quality Assurance Committees. (Id. ¶¶ 16, 17.) Plaintiff further asserts that defendants, by controlling admitting privileges, consulting privileges and referrals, influence other physicians who vote on these matters. (Id. ¶ 17.)

Prior to June 2001, plaintiff often criticized the Hospital's management and the level and quality of care provided by the Hospital and the various doctors on staff. (Id. ¶ 18.) Plaintiff frequently wrote the Hospital expressing her concerns without result. (Id. ¶ 19.) She began charting her comments about inadequate care and was apparently criticized by the Hospital administration and her peers for so doing. (Id.)

In spring 2001, the Joint Accreditation Hospital Commission ("JAHC") evaluated the Hospital's Medicare supervision and care. (Id. ¶ 20.) Plaintiff made an appointment with JAHC to express her concerns regarding the level and quality of care provided at the Hospital. (Id.) Plaintiff was allegedly approached by certain employees and administrators of the Hospital*fn5 prior to her appointment and warned not express her criticisms. (Id. ¶ 21.) Specifically, she was told "we can do a lot to you [if you complain]" and "it will not be good for you [if you complain]." (Id. (alterations in original).) Plaintiff, frightened by these remarks, cancelled her meeting with JAHC. (Id.) Plaintiff allegedly had a "contract of affiliation" with the Hospital that was due for renewal in July 2001. (Id. ¶ 31.) Plaintiff, however, failed to file a renewal application in a timely manner.*fn6 (Id.) According to plaintiff, it "is usual and customary to accept such renewals out of time, as they generally are pro forma."*fn7 (Id.)

On September 1, 2001, plaintiff received a letter, on Hospital letterhead, from an entity identified as the "Ad Hoc Committee"*fn8 (the "Committee"). (Id. ¶ 23.) In the letter, the Committee claimed that plaintiff's conduct was "erratic and suspect," and therefore "demanded that plaintiff submit to physical and mental examinations." (Id.) In addition, particularly after September 2001, plaintiff was frequently targeted by the Hospital's employees and medical staff with racist remarks, including epithets such as "foreigner," "dirty foreigner" and "bomber." (Id. ¶ 22.) Plaintiff complained to Thomas Brunelle, then the Executive Vice President and Chief Operating Officer of the Hospital; no steps were taken to halt this alleged abuse. (Id.) Plaintiff also alleges that since the summer of 2001 some or all of defendants, either personally or through others, informed plaintiff's patients that she was "crazy," "insane" and "has serious mental problems" for the apparent purpose of disrupting her relationship with her patients.*fn9 (Id. ¶¶ 45, 46.)

At some point, the Committee advised plaintiff that the Hospital, through the Committee, had initiated a review of the charts of plaintiff's patients. (Id.) Plaintiff was later advised that her care was found to be substandard. (Id. ¶ 26.) Plaintiff secured her own peer review of the same charts, which determined her care to have been appropriate. (Id. ¶ 27.) In addition, defendants, through the Committee, allegedly forced plaintiff to submit to a psychiatric evaluation that determined that she did not suffer from any condition precluding her from practicing medicine. (Id. ¶ 28.) Defendants also allegedly forced plaintiff to take medical leave by threatening to initiate charges that would lead to revocation of her medical license. (Id.) Plaintiff acceded and "asked for leave as demanded."

(Id. ¶ 29.)

The Committee on Physicians' Health of the New York Medical Society ("CPH"), as a result of defendants' complaints, scrutinized plaintiff's conduct. (Id. ¶ 30.) The CPH did not find any basis for taking action against plaintiff. (Id.) The CPH works closely with the licensing authority, the Office of Professional Medical Conduct ("OPMC"), which deals with doctors who suffer from psychiatric problems and drug addictions. (Id.) Defendants repeatedly reminded plaintiff of N.Y. PUB. HEALTH L. § 2803, which requires a hospital that declines to renew a physician's privileges because of health or competency issues to report that physician to the OPMC.*fn10

(Id. ¶ 32.) During summer 2003, one or more of defendants advised the OPMC that plaintiff was resigning from the Hospital "to avoid disciplinary proceedings." (Id.) The OPMC investigated plaintiff's conduct at the Hospital from October 2003 to April 2004 and closed the case "without further action anticipated." (Id. ¶ 33.)

Based on these events, as well as other facts irrelevant to the present action, plaintiff filed suit on February 14, 2003 against the Hospital, Kaufmann, Auerbach, Brooks and Brody for substantially the same claims she raises here. See Mahmud, 289 F. Supp. 2d at 468-69. The defendants in that case moved to dismiss the Complaint, which motion was granted without prejudice by this Court by Opinion and Order dated October 31, 2003 and with leave to amend the Complaint to supply the missing allegations in plaintiff's slander claim or reassert her other claims after exhausting her remedies with the Public Health Council ("PHC") as required under N.Y. PUB.

HEALTH L. § 2801-b. See id. at 469.

In the interim, plaintiff applied for a contract of affiliation with ORMC in May 2003, which would grant plaintiff privileges at that facility. (See id. ¶¶ 38, 40, 42.) Plaintiff alleges that little or no action was taken on the application until October 2003, when she was contacted by Dr. Mark Tuckfelt, the Vice President of Medical Affairs and Medical Director for ORMC, who informed her that, based on information he learned from plaintiff's colleagues, "he questioned her character and ability to work with others." (Id. ¶¶ 39, 43 (internal quotation omitted).) Allegedly, Tuckfelt went on to suggest "that a withdrawal 'prior to review by the Credentials Committee would not be reportable to the National Practioner Data Bank.'" (Id. ¶ 39.) Plaintiff continued with her application, to which ORMC responded with "foot-dragging, obstructionism and impossible demands, such as demanding that she produce non-existent minutes from [Hospital] meetings, and patient records to which [p]laintiff had no access." (Id. ¶¶ 40, 41.) On June 28, 2004, ORMC's Medical Executive Committee denied plaintiff's application. (Id. ¶ 42.)

Plaintiff petitioned the PHC in January 2004 for a review of the Hospital's decision. (Id. ¶ 35.) The PHC, by decision dated July 26, 2004, determined that the Hospital's decision was "consistent with [NY]PHL § 2801-b."*fn11 (Id. ΒΆ 36.) According to plaintiff, the PHC did not perform an independent investigation, nor did it hold any hearings before accepting the Hospital's ...

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