Babchuk v. Ind. Univ. Health, Inc. – March 2015 (Summary)

SECTION 1983

Babchuk v. Ind. Univ. Health, Inc., No. 1:13-cv-01376-JMS-DML (S.D. Ind. Mar. 20, 2015)

The United States District Court for the Southern District of Indiana granted a hospital’s motion for summary judgment against a radiologist’s due process claim. The radiologist and his professional corporation had sued the hospital following the suspension of his medical staff privileges and the subsequent termination of an exclusive contract.

In order to establish a procedural due process claim, the radiologist and his professional corporation had to show that they were deprived of a legally protected property interest in a way that did not afford them adequate due process. Furthermore, they had to show that the hospital was considered a “state actor” under the law.

The radiologist marshaled several reasons to support his claim that the hospital was a state actor, including an argument that the hospital was a state actor because it received immunity for its peer review activities. Specifically, the radiologist asserted that this immunity was a role delegated by the state to the hospital, and therefore made the hospital into a state actor for purposes of the due process claim.

The court disagreed with the radiologist’s argument about immunity, noting that the Seventh Circuit had rejected a similar argument earlier this month. However, the court ultimately decided that neither side had presented enough evidence to conclude determinatively that the hospital was not a state actor. Accordingly, it declined to grant summary judgment on this element.

Next, the court focused on whether the physician and his professional corporation had a legally protected property interest. The hospital argued that even if it was considered a state actor, the radiologist’s due process claim could not proceed because there was no federally protected property interest at stake. The court agreed with the hospital. First, it explained that the professional corporation did not have any kind of constitutionally protected property interest merely because of its contract with the hospital. Second, it concluded that the radiologist had failed to show that he was entitled to any kind of constitutionally protected property interest in the procedures afforded by the hospital’s bylaws. It noted that the hospital had not directly caused any harm to the physician’s license, and rejected the physician’s claim that Indiana state law gave him a federally protected property interest in certain procedures.

The court granted the hospital’s motion for summary judgment. It denied the radiologist’s and professional corporation’s competing motion for partial summary judgment and entered final judgment.