McGee v. St. Luke’s Health Network — Mar. 2017 (Summary)

PHYSICIAN EMPLOYMENT/REFERENCE RESPONSES

McGee v. St. Luke’s Health Network
No. 425 EDA 2016 (Pa. Super. Ct. March 7, 2017)

The Pennsylvania Superior Court affirmed a lower court’s judgment on a breach of contract claim and denied a physician’s request for a new trial on damages.

A hospital suspended the privileges of one of its physicians and eventually terminated his employment.  The physician later sought a letter of reference from the hospital’s vice president, which letter referenced several reasons for the physician’s termination at the hospital.  After the letter was sent, the physician sued, alleging defamation and tortious interference.  Eventually, the parties entered into a settlement agreement, one term of which required the hospital to provide a template letter each time the hospital received a reference request about the physician.  However, on two subsequent occasions – one sent to a licensure board and the other to a hospital – the hospital deviated from the language of the agreed-upon reference.

In the ensuing trial for defamation and breach of the settlement agreement, the jury awarded the physician an amount substantially less than the amount the physician’s expert had calculated that he was due.  Following post-trial motions, the court reduced the amount of the award because of faulty jury instructions.  The physician challenged this reduction on the basis that the expert’s testimony was unopposed and demanded a new trial on damages.

The court first discussed the hospital’s cross-examination of the physician’s expert.  Although the hospital did not provide its own expert to rebut the physician’s damage calculations, its cross-examination of his expert sufficiently challenged the assumptions of the expert so as to render his opinion controversial rather than uncontroverted.  The hospital’s failure to present contrary evidence or expert testimony, therefore, did not constitute acquiescence to the opposing expert’s opinion.  Thus, to the extent that the expert’s calculations were discredited by the hospital at trial, the jury was entitled to reduce the amount of the physician’s award.

The court also held that the lower court’s post-trial reduction of the award was appropriate because there was “no evidence supporting actual damages” suffered by the physician as a result of the hospital’s non-conforming letters.  Accordingly, the court affirmed the trial court’s decision and rejected the physician’s request for a new trial on damages.