Benefis Healthcare v. Great Falls Clinic

Specialty Hospitals

Benefis Healthcare v. Great Falls Clinic, LLP,
No. DA 06-0240 (Mont. Oct. 4, 2006)

The Montana Supreme Court upheld a trial court
ruling which denied a hospital’s request to invalidate the license used by
a multi-specialty physician-owned medical clinic and its out of state partner
to operate a surgical hospital. The hospital filed suit in January, a few days
after the clinic announced plans to buy the surgical hospital with its Minnesota
partner. The trial court denied the hospital’s request for a preliminary injunction,
and the hospital appealed to the Montana Supreme Court.

The Montana Supreme Court cautioned the trial court to be careful not to resolve
ultimate issues of the case when ruling on motions for preliminary injunctions.
The court dismissed the hospital’s arguments that the surgical hospital is
a specialty hospital and its license to operate is invalid because of the state
moratorium on specialty hospitals. The court ruled that state law does not
require the state licensing authorities to permit public participation in the
process. It also dismissed the hospital’s claim that the hospital would suffer
irreparable injury because of the change of ownership of the surgical hospital.
Accordingly, it upheld the trial court’s decision denying the hospital’s request
for a preliminary injunction.