Innovative Application of Section 1981 and Medical Staff By Laws as Contracts

Ennix v. Stanton (and Alta Bates Summit Medical Center) significantly broaden the use of 42 U.S.C. §1981 in credentialing cases. In this United States District Court case for the Northern District of California, the court denies the hospital’s motion for summary judgment, holding that Dr. Ennix, an African-American cardiac surgeon has satisfied the burden of pleading his contract and discrimination actions against Alta Bates Summit Medical Center. 

Medical Staff By Laws as Contracts:

Establishing a contract based upon the medical staff by laws is already an uphill fight in California. California state courts have already ruled, in O-Byrne v. Santa Monica, that the medical staff by laws do not themselves constitute a contract. However, the court ruled that Dr. Ennix has sufficiently pled that the medical staff by laws and credentialing process created a contract between the hospital and Dr. Ennix over and above the medical staff by laws themselves. The court stated that this was enough to defeat the hospital’s motion for summary judgment. 

Section 1981 Discrimination:

Section 1981 provides that all persons shall have the same right to make and enforce contracts. Dr. Ennix has alleged racial discrimination based upon the contract claim. The District Court applied the McDonnell Douglas test, concluding that Dr. Ennix satisfied the initial burden of establishing a prima facie case of racial discrimination. The burden then shifted to the hospital to prove it had a legitimate non-discriminatory reason for the adverse action, in support of which the hospital asserted the decisions of the peer review committees regarding substandard care provided by Dr. Ennix. The court assumed this was sufficient to shift the burden back to Dr. Ennix to prove these allegations were a mere pretext. The court then concluded that Dr. Ennix had offered sufficient evidence regarding the disparate treatment of Dr. Ennix in the peer review process to establish genuine issues of material fact. 

The inclusion of the 1981 cause of action avoids the immunity provisions of HCQIA.

A copy of the opinion is attached.