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Simpson v. Beaver Dam Cmty. Hosps., Inc.

United States Court of Appeals, Seventh Circuit

March 11, 2015

MICHAEL H. SIMPSON, Plaintiff-Appellant,

Argued November 5, 2014

Appeal from the United States District Court for the Western District of Wisconsin. No. 3:13-cv-00040-bbc -- Barbara B. Crabb, Judge.

For MICHAEL H. SIMPSON, Plaintiff - Appellant: Nicholas E. Fairweather, Attorney, Colin B. Good, Attorney, HAWKS QUINDEL, S.C., Madison, WI.

For BEAVER DAM COMMUNITY HOSPITALS, INCORPORATED, Defendant - Appellee: Timothy G. Costello, Attorney, OGLETREE DEAKINS, Milwaukee, WI.

Before BAUER, ROVNER, and TINDER, Circuit Judges.


Page 785

Tinder, Circuit Judge.

Plaintiff Michael H. Simpson, a black physician, sued Defendant Beaver Dam Community Hospital (" BDCH" ), alleging that it violated Title VII of the Civil Rights Act of 1964 and 42 U.S.C. § 1981 by rejecting his application for medical staff privileges on the basis of his race. Simpson appeals from the district court's grant of summary judgment to BDCH. We affirm.

Page 786

I. Background

Dr. Simpson was recruited to apply for a family medicine position at BDCH in 2010. BDCH's President and Chief Executive Officer, Kimberly Miller, made the decision to offer Simpson employment with the concurrence of BDCH's Chief Operations Officer, Mark Monson, after Simpson interviewed with them and other staff at BDCH. (Neither Miller nor Monson is a physician.) Both Miller and Monson were aware of Simpson's race when they made the employment decision. BDCH paid the recruiter $12,000 because Simpson accepted its offer of employment.

BDCH's employment offer was for a position as a family practice physician pursuant to a Physician Employment Agreement, which stated that Simpson " must apply for, obtain and maintain" active medical staff membership and clinical privileges (collectively " medical staff privileges" ) at BDCH. The agreement also provided that BDCH would pay Simpson a $20,000 signing bonus " within five (5) days after first day of employment." However, receipt of the bonus was contingent on Simpson's obtaining medical staff privileges and fulfilling other conditions of the employment agreement.

Dr. Simpson applied for medical staff privileges at BDCH, submitting his application to BDCH's Credentials Committee in late April 2010. His application stated that he was board certified with the American Board of Family Physicians and held an unrestricted license to practice medicine in Indiana and Illinois. It also indicated that he was a defendant in two medical malpractice cases involving wrongful death, but it did not disclose that these claims were not covered by malpractice insurance. Simpson noted that he had received a professional sanction; he had been placed on academic probation during his first year of residency. By applying for appointment to the medical staff, Simpson expressly " authorize[d] and consent[ed] to the Hospital, its Medical Staff and their representatives to consult with Administrators and members of Medical Staffs of other hospitals with which [he has] been associated, and with others who may have information bearing on [his] competence, character and ethical qualifications."

BDCH's Credentials Committee reviews an application for medical staff privileges and makes a recommendation to the Medical Executive Committee, which then reviews the applications and makes a recommendation to the Board of Directors regarding the granting or denying of medical staff privileges. The Board of Directors makes the decision whether to grant or deny medical staff privileges.

The Bylaws of the Medical Staff of BDCH state the following with respect to applications for medical staff privileges:

Applications for appointment to the Medical Staff will only be accepted from physicians ... who (1) have unrestricted legal licenses to practice their respective profession in the State of Wisconsin ... ; (2) have offices and residences located in sufficient proximity to the Hospital to be able to provide quality care to their patients at the Hospital; (3) can document their (i) background, experience, training, good judgment, and current competence, as demonstrated by peer data, references and otherwise, (ii) adhere to the ethics of their profession, (iii) have good reputation and character, including mental and emotional stability and physical health status, according to the law, and (iv) have the ability to work harmoniously with others so that the Hospital is sure that all patients treated by them at the Hospital will receive quality care and that the Hospital and its Medical and Allied Staffs will be able to operate

Page 787

in an orderly manner; and (4) maintain at least the minimum professional liability insurance coverage set forth by the Hospital.

The Bylaws provide that applicants have " the burden of adequately documenting and demonstrating that their credentials meet the standards necessary to assure the Medical Staff and the Board that patients treated by them in the Hospital will be given a high quality of medical care." The By-laws further provide that no applicant

is entitled to appointment to the Medical Staff or to the exercise of particular clinical privileges in the Hospital solely by virtue of the fact that he/she is duly licensed to practice medicine ... in Wisconsin, or any other state, or that he/she meets any written minimum criteria which may from time to time be adopted by the Board, or that he/she maintains a certification, ... or is a member of any professional organization specialty body or society....

BDCH's Credentials Committee consisted of seven physicians, with one vote each. Dr. Joel Miller was the Chairman of the Credentials Committee and only voted in the event of a tie. A majority of the voting members of the Credentials Committee had to vote to grant medical staff privileges in order for the Committee to make a favorable recommendation to the Medical Executive Committee. Kimberly Miller and BDCH's Medical Staff Chief of Staff Dr. Eric Miller were nonvoting members of the Credentials Committee. The Executive Assistant to the Medical Staff, Lisa Wendlandt, also attended Credentials Committee meetings to provide administrative support. (Kimberly Miller and Drs. Eric Miller and Joel Miller are not related.)

Beginning in the spring and continuing into the summer 2010, BDCH collected information regarding Dr. Simpson's application for medical staff privileges. On September 24, 2010, the Credentials Committee met to review his application. The minutes for the meeting note:

Members reviewed the profile for Dr. Michael Simpson. Members expressed various concerns including: the number of places practiced in the past six years, state licensing board requiring oral test, malpractice cases, and the gaps in employment.
Members would like the following questions answered:
Letter to Licensing Board: Ask the Wisconsin medical licensing board why Dr. Simpson was required to take orals.
Letter to Dr. Simpson: Explain all gaps including residency and medical school, residency and board certification, and any other gaps.
What happened with initial medical school in Illinois?
Members asked questions regarding the interview and employment process.

According to Dr. Joel Miller, this was the first time the Credentials Committee had considered a candidate who, although licensed in other states, was required by the Wisconsin State Medical Examining Board to take an oral exam prior to a decision on licensure. The Credentials Committee also had concerns about the two pending uninsured malpractice claims against Dr. Simpson and how they related to his ability to manage his practice and his interpersonal skills with his patients. The Committee tabled Simpson's application to obtain more information and deferred action on it until its next scheduled meeting on October 13, 2010.

Later on September 24, Dr. Simpson went to BDCH to get his $20,000 sign-on bonus check. He expressed frustration that ...

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