Kadlec V. Lakeview Anesthesia Associates and Lakeview Medical Center

Kadlec V. Lakeview Anesthesia Associates and Lakeview Medical Center

As a plaintiff, Kadlec Medical Center sued Dr. Berry Robert (the defendant), a major shareholder and anesthesiologist at Lakeview Medical Center and LAA (Louisiana Anesthesia Associates). The lawsuit was based on his use of narcotics on-duty, thus nearly causing the patient’s death. According to the plaintiff, Lakeview and LAA’s referral letters were misleading because they failed to disclose Dr. Berry’s addiction to narcotic and past history marred by negligence (Sanford 384).

Despite his use of narcotics, Dr. Berry applied to work for Kadlec Medical. In his application letter, he included referrals from the former workmates at LAA. The referrals were reviewed by the hiring committee at Kadlec Medical as a formal process of credentialing. In both letters, his workmates did not mention that the doctor was fired less than two months because he put the patient’s lives at risk. Instead, they showered praises on Dr. Berry’s competence and professionalism. In addition, Lakeview received questionnaires from Kadlec on behavioral problems and disciplinary actions. However, out of 14 questionnaires on the information about the firm’s workforce, only Dr. Berry’s was neither completed nor returned. While treating Jones, the doctor did not follow the procedure. Therefore, he failed to resuscitate the patient, resulting in a permanent vegetative state. Thereafter, Kadlec paid $8 million in settlement of the case and sued Lakeview for negligent and intentional misrepresentation of their former employee as indicated in the referrals.

Issues

There were four issues highlighted in the lawsuit. The first one was if the defendants were morally obligated not to conduct affirmative misrepresentations in the referrals on Dr. Berry. Second was if the shareholders’ statements were misleading materially. The third issue concerned the hospital referral letter and if it was misleading. Lastly, the court sought to determine whether the defendants were mandated to disclose sensitive personal information in their referral letters.

Rule

The holdings in the first and second issues were ‘yes’ while in the third and fourth, they were ‘no’. The court ruled that Dr. Berry’s former employer is liable for misleading information in the referrals that did not fully disclose Dr. Berry’s addiction to narcotics and his past negligence.

Argument

In the ruling, the court argued that it is legal for a party to keep total silence so as not to violate any rule of law. However, volunteering to provide information to influence the conduct of a second party binds him to disclose the whole information and truth. The argument applied to the doctors who chose to author the referral letters (Sanford 383). Secondly, the former work mates’ statements misled the plaintiff because they indicated Dr. Berry’s excellence in his profession and that he was highly recommendable. Thus, they were false and materially misleading. Thirdly, Lakeview’s letter did not mislead the organization because it neither recommended the doctor nor indicated his proficiency as a physician. Lastly, the court strongly rejected the public policy argument due to concerns on claims of defamation and the need for employee’s privacy.

In summary, the jury ruled in favor of the plaintiff given the circumstances surrounding the affirmative misrepresentations, misleading statements, and affirmative duty to full disclosure of employee’s private information (Sanford 383). As a result, the plaintiff was awarded $8.2 million. Since this case, the law has been amended to accommodate arrest cases of partial disclosure of a party’s information for malicious reasons. Currently, the American courts refer to this ruling in similar cases.

Works Cited

Sanford, Sallie Thieme. "Candor After Kadlec: Why, Despite the Fifth Circuit's Decision, Hospitals Should Anticipate an Expanded Obligation to Disclose Risky Physician Behavior." Drexel Law Review 1 (2009): 383-385.