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Toranto v. Jaffurs

United States District Court, S.D. California

September 13, 2019

JASON TORANTO, Plaintiff,
v.
DANIEL JAFFURS, et al, Defendants.

          ORDER DENYING DEFENDANTS' MOTIONS FOR SUMMARY JUDGMENT (DOC NOS. 275, 288, 289, 291)

          JOHN A. HOUSTON United States District Judge

         INTRODUCTION

         Pending before the Court are Defendants Children's Hospital of Orange County ("CHOC"), Children's Hospital of Orange County Medical Staff ("CHOC Medical Staff), Dr. Amanda Gosman and Rady Children's Hospital-San Diego ("Dr. Gosman and Rady's"), and Dr. Daniel Jaffurs' ("Dr. Jaffurs") Motions for Summary Judgment. See Doc. Nos. 275, 288, 289, 291. Plaintiff Dr. Jason Toranto ("Plaintiff or "Dr. Toranto") filed responses in opposition. See Doc. Nos. 305, 311, 320. The Motions are fully briefed. After careful consideration of the pleadings filed by all parties, and for the reasons set forth below, this Court DENIES Defendants' Motions for Summary Judgment.

         FACTUAL BACKGROUND

         Dr. Toranto is a pediatric plastic surgeon and craniofacial surgeon. Doc. No. 263 at pg. 2. Dr. Toranto and Dr. Jaffurs are former colleagues from previous employment at the UC Irvine School of Medicine ("UCI") and later, Children's Hospital of Orange County ("CHOC"). Id. Dr. Toranto alleges that Dr. Jaffurs made false and defamatory statements that caused CHOC Pediatric Subspecialty Faculty (the "CHOC Foundation") to deny Dr. Toranto an employment opportunity. Id. Dr. Toranto alleges that after he moved to San Diego, Dr. Jaffurs acted in concert with Dr. Amanda Gosman, the Chief of Plastic Surgery at Rady Children's Specialists of San Diego and UCSD, and continued to make false and defamatory statements to Rady Children's Hospital, Rady Children's Specialists of San Diego (the "Rady Foundation"), and the University of California, San Diego ("UCSD"). Id. at pg. 3. In addition, Dr. Toranto alleges that Dr. Maria Minon, the Chief Medical Officer at Children's Hospital Orange County, acted within the scope of her employment when making false oral statements to Rady's Children's and the Rady Children's Medical Staff. Id. at page 16, 50. Dr. Toranto alleges that Rady Children's Hospital denied his application without speaking to or meeting with him, and without going through an objective peer review process to assess his qualifications. Id. at pg. 4.

         Dr. Toranto brings this case against Defendants, alleging seven causes of action: (1) conspiracy in restraint of trade; (2) monopoly; (3) retaliation pursuant to California Business & Professional Code §§ 510-512; (4) defamation; (5) violation of Labor Code § 1050 et seq.; (6) tortious interference with prospective economic advantage; and (7) unfair competition. See Doc. No. 263.

         PROCEDURAL BACKGROUND

         On July 1, 2016, Dr. Toranto filed his initial complaint against CHOC Medical Group, CHOC Medical Staff, Children's Hospital of Orange County, Dr. Gosman, Dr. Jaffurs, The Regents of the University of California, and various Rady entities. See Doc. No. 1. On August 15, 2016, Dr. Toranto filed an amended complaint. See Doc. No. 21. Rady's filed a motion to dismiss on September 1, 2016, and Dr. Jaffurs filed a motion to dismiss on September 13, 2016. See Doc Nos. 21, 32. On March 21, 2018, this Court issued an Order GRANTING in part and DENYING in part Defendants' motions to dismiss. See Doc. No. 107. Dr. Toranto filed a Second Amended Complaint on July 25, 2018 and a Third Amended Complaint on March 11, 2019. See Doc. Nos. 169, 263. On March 21, 2019, Children's Hospital of Orange County filed an Amended Motion for Summary Judgment. See Doc. No. 275. On April 15, 2019, Dr. Gosman and Rady's filed a Motion for Summary Judgment. See Doc. No. 288. On April 15, 2019, Dr. Jaffurs filed a Motion for Summary Judgment. See Doc. No. 289. On April 15, 2019, CHOC Medical Staff filed a Motion for Summary Judgment. See Doc. No. 291. Plaintiff filed a response in opposition to Rady Defendants' Motion for Summary Judgment on June 3, 2019. See Doc. No. 305. On June 4, 2019, Plaintiff filed a response in opposition to CHOC and CMS Defendants' Motion for Summary Judgment. See Doc. No. 311. Plaintiff filed a response in opposition to Defendant Dr. Jaffurs' Motion for Summary Judgment on June 10, 2019. See Doc. No. 320.

         DISCUSSION

         I. Legal Standard

         Summary judgment is only appropriate when no genuine dispute of material fact exists. Irdeto Access, Inc. v. Echostar Satellite Corp., 383 F.3d 1295, 1299 (Fed. Cir. 2004), quoting Bai v. L & L Wings, Inc., 160 F.3d 1350, 1353 (Fed. Cir. 1998).

         A fact is material when, under the governing substantive law, it could affect the outcome of the case. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); Freeman v. Arpaio, 125 F.3d 732, 735 (9th Cir. 1997). A dispute about a material fact is genuine if "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson, 477 U.S. at 248.

         A party seeking summary judgment always bears the initial burden of establishing the absence of a genuine issue of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). The moving party may satisfy this burden in two ways: (1) by presenting evidence that negates an essential element of the nonmoving party's case or (2) by demonstrating that the nonmoving party failed to make a showing sufficient to establish an element essential to that party's case on which that party will bear the burden or proof at trial. Id. at pgs. 322-23.

         Where the party moving for summary judgment does not bear the burden of proof at trial, it may show that no genuine issue of material fact exists by demonstrating "there is an absence of evidence to support the non-moving party's case." Id. at pg. 325. The moving party is not required to produce evidence showing the absence of a genuine issue of material fact, nor is it required to offer evidence negating the nonmoving party's claim. Lujan v. National Wildlife Fed'n, 497 U.S. 871, 885 (1990); United Steelworkers v. Phelps Dodge Corp., 865 F.2d 1539, 1542 (9th Cir. 1989). "Rather, the motion may, and should, be granted so long as whatever is before the District Court demonstrates that the standard for the entry of judgment, as set forth in Rule 56(c), is satisfied." Lujan, 497 U.S. at 885 (quoting Celotex, 477 U.S. at 323). If the moving party fails to discharge this initial burden, summary judgment must be denied and the court need not consider the nonmoving party's evidence. See Adickes v. S.H. Kress & Co., 398 U.S. 144, 159-60 (1970).

         "Disputes over irrelevant or unnecessary facts will not preclude a grant of summary judgment." T.W. Elec. Serv., Inc. v. Pacific Elec. Contractors Ass'n, 809 F.2d 626, 630 (9th Cir. 1987). "The district court may limit its review to the documents submitted for purpose of summary judgment and those parts of the record specifically referenced therein." Carmen v. San Francisco Unified Sch. Dist, 237 F.3d 1026, 1030 (9th Cir. 2001). Therefore, the court need not "scour the record in search of a genuine issue of triable fact." Keenan v. Allen, 91 F.3d 1275, 1279 (9th Cir. 1996) (citing Richards v. Combined Ins. Co., 55 F.3d 247, 251 (7th Cir. 1995)).

         The court may not make credibility determinations, and inferences to be drawn from the facts must be viewed in the light most favorable to the party opposing the motion. Masson v. New Yorker Magazine, 501 U.S. 496, 520 (1991); see Anderson, 477 U.S. at 255; Matsushita, 475 U.S. At 587.

         II. Analysis

         The Court will first address CHOC and CHOC Medical Staffs Motions. CHOC Medical Staff makes the same arguments as CHOC. See Doc. No. 291-1. The Court will then address the Motion filed by Dr. Gosman and Rady's, followed by the Motion filed by Dr. Jaffurs.

         a. CHOC and CHOC Medical Staff

         i. Agency and Respondeat Superior

         CHOC argues that California law prevents lay organizations from exercising control over decisions made by physicians. Doc. No. 275-1 at pgs. 18-19. CHOC contends that the medical staff, not the hospital, controls the hiring of physicians. Id. at pg. 19. CHOC argues that respondeat superior does not apply here because one could not reasonably conclude, based upon the evidence, that Dr. Toranto was a CHOC employee. Id. at pgs. 21-24. CHOC further argues that it did not supervise Dr. Toranto, did not pay him, and never created an employer-employee relationship. Id. at pg. 24. CHOC contends that Dr. Jaffurs was never an agent of CHOC. Id. at pg. 29. CHOC argues that Dr. Toranto does not allege that Dr. Jaffurs' unlawful conduct was authorized or ratified by CHOC. Id. at pg. 30. CHOC argues that the "gravamen of [Dr. Toranto's] claims against CHOC is the conduct of Jaffurs, not CHOC."

         In response, Dr. Toranto argues that Dr. Jaffurs represented himself as CHOC's agent, and CHOC assented to this representation through silence. Doc. No. 311 at pg. 18. Dr. Toranto contends that Dr. Jaffurs "exercised apparent authority as CHOC's Medical Director of Plastic Surgery when he deprived Plaintiff of clinic time at CHOC." Id. Dr. Toranto asserts that by delegating responsibilities for peer review activities to its medical staff, the hospital impliedly makes the medical staff its agent. Id. at pgs. 18-19. Dr. Toranto contends that Dr. Jaffurs and Dr. Minon are also agents of CHOC Medical Staff. Id. at pgs. 19-20. Dr. Toranto asserts that Dr. Jaffurs, as the Section Chief of Plastic Surgery, designated himself as an agent of the CHOC Medical Staff. Id. at pg. 20. Dr. Toranto contends that among Dr. Jaffurs' other duties, his responsibilities as Section Chief included acting as a presiding officer at section meetings, participating in the administration of the section, and launching investigations into the clinical privileges of section members. Id. Dr. Toranto argues that Dr. Minon, as Vice President of Medical Affairs and Chief Medical Officer at CHOC, was also an agent of CHOC. Id. Dr. Minon was appointed by CHOC's CEO and served as an administrative liaison between hospital administrators. Id. Dr. Toranto argues that both Dr. Jaffurs and Dr. Minon were empowered and subject to removal from their positions by the CHOC bylaws. Id. Dr. Toranto argues thus, Dr. Jaffurs and Dr. Minon's communications with Rady's Hospital were done as agents on behalf of CHOC and CHOC Medical Staff. Id. at pgs. 20-24.

         ii. Professional Review

         CHOC asserts that the Health Care Quality Improvement Act creates immunity from damages liability for professionals who participate in peer review activities. See Doc. No. 275-1. CHOC also asserts that the standard for such immunity covers all professional review action taken in the following situations:

         "(1) in the reasonable belief that the action was in the furtherance of quality health care, (2) after reasonable effort to obtain the facts of the matter, (3) after adequate notice and hearing procedures are afforded to the physician or after such other procedures as are fair to the physician under the circumstances; and (4) in the reasonable belief that the action was warranted by the facts known after such reasonable effort to obtain facts and after meeting the requirements of paragraph 3." Id. at pgs. 19-20

         CHOC contends that California law extends immunity to "communications made in the initiation or course of any proceedings authorized by law such as peer review/credentialing proceedings." Id. at pg. 20. CHOC asserts that California law also extends immunity to "any communication which is not a lie and is intended in good faith to aid in the evaluation of the qualifications, fitness, and/or character of a physician." Id. at pg. 21. Id. at pg. 40. CHOC contends that California law extends immunity to "communications made in the ...


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