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Thurlow v. York Hospital

United States District Court, D. Maine

January 10, 2017

JEFFERY THURLOW, Plaintiff,
v.
YORK HOSPITAL, Defendant.

          ORDER ON PLAINTIFF'S MOTION TO AMEND AND DEFENDANT'S MOTION TO DISMISS

          Nancy Torresen United States Chief District Judge.

         Before me are the Plaintiff's motion to amend the Complaint pursuant to Federal Rule of Civil Procedure 15(a)(2) (ECF No. 33) and the Defendant's motion to dismiss pursuant to Rule 12(b)(6) (ECF No. 27). For the reasons stated below, the Plaintiff's motion is GRANTED and the Defendant's motion is DENIED.

         BACKGROUND[1]

         The Plaintiff is Doctor Jeffery Thurlow, a board-certified surgeon who specializes in general surgery. Proposed Am. Compl. ¶¶ 2, 7 (“PAC”) (ECF No. 33-1). Dr. Thurlow has held clinical privileges at York Hospital since 2002. See PAC ¶¶ 13-14. York Hospital recruited him in order to “strengthen the clinical expertise and the capacity of York Hospital's Department of Surgery.” PAC ¶ 13. In 2006, York Hospital hired Dr. Thurlow as an employee. PAC ¶ 14. During his tenure at York Hospital, Dr. Thurlow was “by far the most productive general surgeon in its employ” and “was universally regarded by his peers as the most dependable, skilled, and proficient general surgeon on the York Hospital staff.” PAC ¶ 44.

         The Defendant is York Hospital, located in York, Maine. PAC ¶ 8. Jud Knox is the President of York Hospital. PAC ¶ 17. Although Knox is at the helm of the hospital administration, the York Hospital Medical Staff, an association of physicians, functions largely independently of the hospital administration. See PAC ¶ 32. Dr. Thurlow was the President of the Medical Staff from approximately 2010 to 2012. See PAC ¶¶ 21, 26.

         In 2007, York Hospital hired “Dr. Doe” to join the practice that included Dr. Thurlow. PAC ¶ 15. While working with Dr. Doe, Dr. Thurlow became aware of “evidence which caused him to believe that Dr. Doe was performing unnecessary peripheral nerve surgery, endangering patients in the process, falsifying surgical notes, and ‘coding' fraudulently for the surgical procedures he performed in order to support claims for reimbursement to which he was not legally entitled.” PAC ¶ 16. Dr. Thurlow informed Knox about his concerns. PAC ¶ 17. Eventually, Dr. Doe was removed from Dr. Thurlow's practice group at the insistence of Dr. Thurlow and another physician. PAC ¶ 19. Dr. Doe was still “retained as an employee of York Hospital as a member of a second hospital-owned general surgery practice, ” but Dr. Thurlow did not have to work with him because there was no cross-coverage arrangement between the two separate hospital-owned surgery groups. See PAC ¶¶ 19-20.

         In 2010, while Dr. Thurlow was the President of the Medical Staff, he began a formal investigation into Dr. Doe's peripheral nerve surgery practice. PAC ¶ 21. The resulting external review of Dr. Doe's practice “was highly critical.” PAC ¶ 24. The Medical Executive Committee of the York Hospital Medical Staff held a special meeting with the author of the external review. See PAC ¶ 24. The meeting resulted in “a unanimous vote to suspend Dr. Doe's privileges to perform peripheral nerve surgery.” PAC ¶ 24.

         In April of 2012, Dr. Doe tried to “regain permission to perform peripheral nerve procedures.” PAC ¶ 25. In response to this effort, Dr. Thurlow “made a presentation to hospital leadership wherein he set forth . . . his concerns about several aspects of Dr. Doe's practice, including what he believed to be Dr. Doe's fraudulent billing of the United States and other payers.” PAC ¶ 25. In the summer of 2012, Dr. Thurlow's tenure of President of the Medical Staff ended. PAC ¶ 26. Soon after, Dr. Doe's privileges to perform peripheral nerve surgery were reinstated. PAC ¶ 27.

         Although no longer in a leadership position, Dr. Thurlow “continued to express his ongoing concerns about patient safety and ethical issues” to the York Hospital administration. PAC ¶ 28. He continued to voice his concerns through at least the end of 2012. PAC ¶ 30. But the York Hospital administration never placed restrictions on Dr. Doe's practice. See PAC ¶ 32. Instead, “[t]he only restrictions that were ever imposed on Dr. Doe's practice were imposed by the York Hospital Medical Staff” and they were “imposed without the support of Jud Knox.” PAC ¶ 32. The restrictions placed on Dr. Doe by the Medical Staff, which Knox had resisted, were “economically costly to York Hospital.” PAC ¶ 33.

         “At some point before January 2013, ” Knox initiated a plan to merge the two separate hospital-owned surgery groups. PAC ¶ 34. Knox knew that Dr. Thurlow thought that Dr. Doe was “dangerous, dishonest, and unscrupulous” and that the merger would have required the two doctors to work alongside one another. PAC ¶¶ 35, 37. Dr. Thurlow alleges that the plan to merge the two groups was developed in part to create working conditions that were intolerable for him. PAC ¶ 39. He was informed of the planned merger in an email on January 28, 2013. PAC ¶ 34.

         Dr. Thurlow refused to work with Dr. Doe. PAC ¶ 41. York Hospital fired Dr. Thurlow without cause and without notice on March 27, 2013.[2] PAC ¶ 42. The hospital continues to employ Dr. Doe and pays him “substantially more than the fair value of the services he performs.” PAC ¶ 46. After terminating Dr. Thurlow, York Hospital denied him access to a list of his patients and sent a letter to one of his former patients implying that “Dr. Thurlow had voluntarily abandoned the patient.” PAC ¶ 50.

         Because the York Hospital Medical Staff functions largely independently of the hospital administration, Dr. Thurlow continued to remain a member of the Medical Staff even though he was no longer a York Hospital employee. See PAC ¶¶ 32, 51. On December 17, 2013, Knox gave Dr. Thurlow a “behavioral compact” that Dr. Thurlow “would be required to sign if he wished to engage Knox in discussions around ‘the constructive development of cohesive and collaborative general surgical services at York Hospital.' ” PAC ¶ 51. The behavioral compact stated, among other things, that Dr. Thurlow was expected to: (1) “[s]upport the Hospital organization, the Board of Trustees, Jud Knox and the Leadership of the Organization;” (2) refrain from “speaking negatively about the Organization, the Board of Trustees or Leadership;” (3) “cease speaking negatively about past decisions that have been made by the Hospital Organization and Leadership;” and (4) “[d]irect [his] concerns, criticisms, and disagreements with the Hospital decisions and policies directly to Jud Knox in one-on-one private conversations.” Ex. A to PAC (“Behavioral Compact”) (ECF No. 34).

         PROCEDURAL HISTORY

         On March 25, 2016, Dr. Thurlow filed a one-count Complaint alleging retaliation in violation of the False Claims Act (the “FCA”), 31 U.S.C. §§ 3729-3733. Although Dr. Thurlow's attorney emailed a copy of the Complaint and Summons to the Defendant's attorney, he did not serve the Summons and Complaint immediately because he “had filed the complaint more hurriedly than [he] would have liked, in order to avoid a time bar, and [he] intended to continue [his] investigation before making service.” Taintor Aff. ¶ 9 (ECF No. 11-1). The Plaintiff then failed to timely serve the Complaint.

         The Clerk of Court issued an Order to Show Cause asking the Plaintiff to explain why he failed to timely serve the Defendant on June 27, 2016. (ECF No. 7). In response, the Plaintiff's attorney served the Defendant with an Amended Summons on June 30, 2016. Taintor Aff. ¶ 12. The Clerk of Court then issued a second Order to Show Cause directing the Plaintiff to explain why service was not timely made. (ECF No. 10). On July 7, 2016, the Plaintiff timely responded to the Orders to Show Cause, stating that he mistakenly believed that he had 120 days to serve the Complaint, rather than the 90 days allowed by the Federal Rules of Civil Procedure. Taintor Aff. ¶ 10. I found the Plaintiff had shown good cause and terminated the Orders to Show Cause. (ECF No. 12). The Defendant then moved to vacate my order finding good cause. Mot. to Vacate (ECF No. 17). Upon reconsideration, I granted the Defendant's motion, finding that the ...


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