William Harlan, Individually and as Parent and Natural Guardian of Danielle Harlan, a Minor Genice Harlan, Individually and as Parent and Natural Guardian of Danielle Harlan, a Minor v. James S. Lewis, M.D., Calvin J. Hall, C.E. Ransom, Jr., M.D., Movant. William Harlan, Individually and as Parent and Natural Guardian of Danielle Harlan, a Minor Genice Harlan, Individually and as Parent and Natural Guardian of Danielle Harlan, a Minor v. James S. Lewis, M.D., Calvin J. Hall, C.E. Ransom, Jr., Doctor, MovantWilliam Harlan, Individually and as Parent and Natural Guardian of Danielle Harlan, a Minor Genice Harlan, Individually and as Parent and Natural Guardian of Danielle Harlan, a Minor v. James S. Lewis, M.D., Calvin J. Hall, C.E. Ransom, Jr., M.D., Movant. William Harlan, Individually and as Parent and Natural Guardian of Danielle Harlan, a Minor Genice Harlan, Individually and as Parent and Natural Guardian of Danielle Harlan, a Minor v. James S. Lewis, M.D., Calvin J. Hall, C.E. Ransom, Jr., Doctor, Movant
This controversy arises from a medical malpractice case brought against Dr. Lewis by the family of Danielle Harlan. Dr. Lewis was the pediatrician who treated Danielle Harlan during the first few months of her life. The Harlans sued Lewis for allegedly failing to check the results of a mandatory blood test for hypothyroidism. The Harlans allege that the delay in detecting and treating Danielle‘s hypothyroidism caused her significant injury. Danielle was later treated by several other physicians, none of whom are defendants here or are accused by the Harlans of being responsible for any harm to Danielle.
The district court issued a memorandum opinion and order granting the Harlans’ motion on January 29, 1992. The order began:
The Court is troubled by the lack of civility among attorneys which has become all too common. The erosion of cooperation and courtesy within the legal community accounts, in large part, for the negative image attorneys suffer in the community at large.
The district court then analyzed two specific instances of misconduct by Hall.
The first instance arose from a conversation between Hall and Dr. McAdams. The Harlans submitted an affidavit containing the following statement by Dr. McAdams, which the district court quoted in its order:
C.J. Hall [Dr. Lewis’ attorney] came up and met with me in Searcy, Arkansas. He told me that as a treating physician, I may be called as a witness at the trial of this matter or could also be sued by the Harlans.
Mr. Hall also told me that if I did not testify for the Harlans, that the suit would probably not be successful.
The district court held that by suggesting to Dr. McAdams that he not testify, Hall had violated the Model Rules of Professional Conduct, which prevent a lawyer from obstructing another party‘s access to evidence or from counseling a third party to conceal information having possible evidentiary value. See Model Rules of Professional Conduct Rule 3.4(a) (1983). The court went on to state that even if Arkansas law permitted such ex parte interviews, this conduct would be impermissible and unethical. The district court then sanctioned Hall $2,500 for this conduct.
The court next turned to a conversation between Hall and Dr. James Golleher, who supervised the laboratory in which Danielle‘s blood was tested. The district court quoted the following passage from Golleher‘s deposition:
Q (by plaintiffs’ attorney): And during that conversation [with Mr. Hall], you told Mr. Hall that I had requested to speak to you informally and you had no objection to that. You told him that, didn‘t you?
A: Yes.
Q: And Mr. Hall at that time indicated that he did have an objection to you [sic] speaking to me informally, didn‘t he?
A: If I remember right.
The district court then referred to Model Rule 3.4(f), prohibiting a lawyer from requesting that “a person other than a client ... refrain from voluntarily giving relevant information to another party.” Model Rules of Professional Conduct Rule 3.4(f) (1983). The district court concluded that Dr. Golleher was not Mr. Hall‘s client, and that Hall‘s suggestion that Dr. Golleher not speak to Harlan‘s counsel was unethical. The court sanctioned Hall $2,500 for this conduct.
The district court made clear that the sanctions were intended as a “shot across the bow,” and that it considered the monetary sanctions “modest.” It noted that Hall had recently designated the treating physicians as “defense experts.” The district court seriously considered barring the testimony of these treating physician/defense experts in light of Hall‘s attempts to influence their testimony. The court, however, rejected this harsh step because it would have “effectively eviscerate[d] Dr. Lewis‘s ability to present a defense.”
In deciding to impose sanctions and in creating remedial measures, the court discussed in some detail the physician-patient privilege under Arkansas law. In federal courts, state law governs questions involving privilege. See
The district court concluded that even though the privilege was partially waived through the filing of a lawsuit, the Harlans retained some control over the manner in which the information concerning their medical records and treatment might be released.
The district court‘s interpretation of Arkansas Rule of Evidence 503 is closely related both to its imposition of sanctions on Hall and to the other restraints placed on defense counsel in its order. On appeal, Hall and Lewis argue against the district court‘s reading of Rule 503. Hall also argues that the district judge erred in imposing sanctions.
I.
Hall first argues that the district court erred in imposing sanctions without making an explicit finding of bad faith. Hall further contends that there is no factual basis for either an explicit or implied finding of bad faith. We review all aspects of the imposition of sanctions under an abuse of discretion standard. See Chambers v. NASCO, Inc., 501 U.S. 32, 55 (1991) (citing Link v. Wabash R.R. Co., 370 U.S. 626, 633 (1962), and Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 405 (1990)).
The district court sanctioned Hall for two separate actions: Hall‘s conversation with Dr. McAdams, and Hall‘s conversation with Dr. Golleher. The district court found that these actions violated two rules: Model Rule 3.4(f) (prohibiting lawyers from asking non-clients to refrain from giving relevant information to other parties), and Arkansas Rule of Evidence 503 (interpreted by the district court as prohibiting all ex parte contact with plaintiff‘s physicians). The district court also stated that even if its interpretation of Rule 503 was in error and ex parte contact were permissible, Hall‘s conduct would still be impermissible and unethical. We will discuss the district judge‘s interpretation of Rule 503 later, but regardless of that interpretation‘s validity, Model Rule 3.4(f) independently supports the sanctions.
The district court proceeded, under its inherent power, to sanction Hall for both violations of the Model Rule. Both parties now appear to agree that the district court was required to find bad faith prior to imposing sanctions. Hall argues that the finding must be explicit, while the Harlans argue that the finding need only be implicit. We first consider whether the district court must make a finding of bad faith before imposing sanctions pursuant to its inherent power.
The existence in the federal courts of an inherent power “necessary to the exercise of all others” is firmly established. See United States v. Hudson, 11 U.S. (7 Cranch) 32, 34 (1812). While this inherent power “ought to be exercised with great caution,” it includes the power to discipline attorneys appearing before the court. See Ex parte Burr, 22 U.S. (9 Wheat.) 529, 531 (1824). Over the years, the Supreme Court has found inherent power to include the ability to dismiss actions, assess attorneys’ fees, and to impose monetary or other sanctions appropriate “for conduct which abuses the judicial process.” Chambers, 501 U.S. at 44-45. The imposition of monetary sanctions against Hall in this case clearly falls within the district court‘s inherent power.
Hall relies on Chambers and Roadway Express, Inc. v. Piper, 447 U.S. 752 (1980), to support his contention that an explicit finding of bad faith is required. Both Roadway and Chambers, however, discuss the narrow requirement that a district court assessing attorneys’ fees against a party or its counsel find that the party had “acted in bad faith, vexatiously, wantonly, or for oppressive reasons.” Alyeska Pipeline Serv. Co. v. Wilderness Soc‘y, 421 U.S. 240, 258-59 (1975).
Although Roadway ends with a statement that a finding of bad faith “would have to precede any sanction under the court‘s inherent powers,” the entire opinion discusses only the assessing of attorneys’ fees. Roadway, 447 U.S. at 767. We do not believe Roadway extends the “bad faith” requirement to every possible disciplinary exercise of the court‘s inherent power, especially because such an extension would apply the requirement to even the most routine exercises of the inherent power. See, e.g., Anderson v. Dunn, 19 U.S. (6 Wheat) 204 (1821) (discussing the power to “impose silence, respect, and decorum“). We find no statement in Roadway, Chambers, or any other decision cited by the parties,4 that the Supreme Court intended this “bad faith” requirement to limit the application of monetary sanctions under the inherent power.
Moreover, even if we assume that a finding of bad faith is required, we conclude that the district court‘s order implies a finding of bad faith.
The district court first stated that the undisputed facts illustrated Hall‘s misconduct. In reference to Hall‘s conversation with Dr. McAdams, the district court concluded that the conduct violated both the Model Rules and the Arkansas Rules of Evidence, and that the conduct was “impermissible and unethical” even if it did not violate these rules. The district court came to a similar conclusion with regard to Hall‘s conduct in his conversation with Dr. Golleher. Although the district judge did not use the actual words “bad faith,” his order contained explicit statements of far greater severity.
II.
Hall next argues that the district court abused its discretion by imposing sanctions instead of referring Hall‘s conduct to state disciplinary authorities. Hall asserts that “[t]he business of the court is to dispose of litigation and not to act as a general overseer of the ethics of those who practice [before it] unless the questioned behavior taints the trial of the cause before it“. Appellant‘s Brief at 17 (quoting United States v. Dennis, 843 F.2d 652, 657 (2d.Cir.1988)). Hall also argues that “[w]here there is no threat to the integrity of further proceedings, possible ethical violations which ‘surfac[e] during the litigation are generally better addressed by the comprehensive machinery of the state and federal bar.’ ” Id. (quoting Armstrong v. McAlpin, 625 F.2d 433, 444 (2d Cir.1980) (en banc), vacated on other grounds and remanded, 449 U.S. 1106 (1981)).
We entertain no doubt that the district judge was authorized to preserve the integrity of the proceedings before him by imposing sanctions. The questioned behavior tainted the trial of the cause and threatened the integrity of further proceedings. The district judge saw Hall‘s misconduct as having a significant negative effect on both the discovery process and the eventual trial. A district judge must have the power to deal with conduct of attorneys in litigation without delegating this responsibility to state disciplinary mechanisms. State disciplinary authorities may act in such cases if they choose, but this does not limit the power or responsibility of the district court. In addition, the state disciplinary body could not have repaired the damage Hall caused by attempting to restrict the flow of relevant information and discovery and by planting implied threats in the minds of potential witnesses. Under these circumstances, the district court was correct in resolving both the disciplinary and remedial questions in a single action.
Harlan has cross-appealed arguing for a more potent sanction, such as striking the defendants’ answer or precluding the witnesses improperly contacted from testifying. The district court did not abuse its discretion in its careful assessment of the nature of the sanction to be imposed.
III.
Finally, Hall argues that he was sanctioned by the district court without due process of law. The sole issue is whether Hall had notice that the court was considering sanctions against him. Hall contends that the Harlans’ motion seeking sanctions was not sufficiently specific to put him on notice. He also argues that Dr. McAdams’ affidavit, in which the conversation between Hall and McAdams is described, was not before the court until after Hall responded to the Harlans’ motion. After reviewing the record, we conclude that the district court provided due process in imposing sanctions.
A brief review of the procedural history of the sanctions is in order here. On November 13, 1991, the Harlans filed a pleading captioned: “MOTION TO PROHIBIT EX PARTE COMMUNICATIONS and COMMUNICATIONS WITHOUT AUTHORIZATION, TO RECOVER UNNECESSARY COSTS INCURRED BY PLAINTIFF‘S COUNSEL DUE TO THE ACTIONS OF DEFENSE COUNSEL, AND SCHEDULING ORDER.” In this motion, the Harlans requested, among other things, that the court strike the defendant‘s answer in this case and assess attorneys’ fees and other expenses against the defendants. The Harlans also requested “any other relief deemed necessary and equitable by this Honorable Court.” The Harlans also filed a brief and a substantial set of exhibits documenting Hall‘s ex parte communications with various treating physicians (including Drs. Golleher and McAdams). The motion clearly indicates that the Harlans were seeking sanctions for Hall‘s conversations with the treating physicians.
On December 17, 1991, the Harlans replied and attached Dr. McAdams’ affidavit, which the district court cited in its order. The conversation between McAdams and Hall was documented in an exhibit submitted with the Harlans’ original motion. The district court issued its memorandum opinion and order on January 29, 1992.
Hall‘s argument turns on whether the December 6 motion provided Hall with adequate notice that the court would be considering sanctions against him. Striking an answer is the most severe sanction available to a court by virtue of its inherent power, as it would lead to entry of an adverse judgment. Likewise, an assessment of attorneys’ fees can impose a severe penalty. By comparison, the monetary sanctions levelled against Hall are relatively mild. The December 6 motion provided Hall with clear notice that the court would be considering the imposition of the most severe sanctions against the defendants on the basis of Hall‘s personal conduct. If, as he now suggests, Hall possessed additional evidence which would have placed the Golleher and McAdams conversations in context, he had every opportunity, and perhaps an ethical duty, to present them in his client‘s defense.
Even if we accept Hall‘s argument that the alleged conversations were not fully before the court until the McAdams affidavit was filed in connection with the Harlans’ December 17 reply, forty calendar days elapsed before the court entered its order. During that time Hall could have requested a hearing, submitted additional evidence, or alerted the court to any relevant information regarding the disputed conversations. He did none of these things.
Hall relies on our decision in Jensen v. Federal Land Bank, 882 F.2d 340 (8th Cir.1989). The facts of Jensen are distinguishable. In Jensen, a bankruptcy judge sanctioned an attorney immediately after observing that attorney‘s noncompliance with a court order (requiring the attorney to present an amended version of a plan). Id. at 340-41. There was no real notice of any kind in Jensen, and the attorney had no opportunity at all to argue against the imposition of sanctions. Id. at 341-42. Conversely, Hall had notice in the December 6 pleading and at least forty calendar days to respond before the district court acted. The present case resembles Lepucki v. Van Wormer, 765 F.2d 86 (7th Cir.), cert. denied, 474 U.S. 827 (1985), in which the Seventh Circuit held that an attorney who did not have explicit notice that the court was considering imposing costs and fees against him nevertheless had sufficient notice because he knew that the court was considering generally the imposition of penalties. Id. at 88.
Finally, beyond the issue of adequate notice, the district court fully complied with due process. A court must exercise its inherent powers with restraint and discretion, and a primary aspect of that discretion is the ability to fashion an appropriate sanction. See Chambers, 501 U.S. at 44-45. Here, the district judge did not rush into an ill-considered imposition of sanctions. Despite the Harlans’ request, the district judge rejected the most severe sanction available under the court‘s inherent power. He also considered less severe sanctions (i.e., requiring Hall to write a letter of apology). Finally, he considered the effect that various sanctions might have on the course of the litigation and the ability of the parties, especially the defendants, to present their case. In the end, the district judge decided upon a narrowly tailored solution which sanctioned the individual responsible, attempted to remedy the damage caused by the misconduct, and preserved as far as possible the rights of all parties.
We conclude that the district court did not offend due process in its imposition of sanctions against Hall.
IV.
Lewis argues on appeal that the district court erred in interpreting
In the case before us, the district court first reviewed the general history of the physician-patient privilege, and then analyzed the Arkansas statutory physician-patient privilege. In interpreting the 1991 amendments to
We are bound to review de novo the district court‘s state law determination, giving its decision no deference. See Salve Regina College v. Russell, 499 U.S. 225, 231 (1991). We believe that the district court‘s interpretation of
The 1991 amendments to
The district court opinion, the briefs of the parties, and the opinion in King v. Ahrens all raise questions relating to the scope and nature of physician-patient privilege. We need not explore these issues in detail, because we believe that the issue before us concerns not the scope of the privilege but the manner of disclosure required under the Arkansas rules.
Both
New subdivision (c) of this rule sets out the circumstances under which a party must authorize release of his medical records to another party. It also makes plain that a party may not be required to allow an adversary to communicate with the party‘s physician or psychotherapist outside the formal discovery process. This safeguard is deemed necessary to protect the confidential relationship between a party and his physician or psychotherapist.
Another consideration enters our analysis:
The district court relied on the discussion in Crist v. Moffatt, 326 N.C. 326, 389 S.E.2d 41 (1990). Crist differentiated issues of privilege from issues concerning the manner in which information may be obtained from a plaintiff‘s treating physician. Id. 389 S.E.2d at 45-46. Crist pointed to the confidential nature of the physician patient relationship which it held to be separate and distinct from the statutory privilege. Thus, even when the privilege was waived, the confidential nature of the physician-patient relationship justified control over the release of information. Id. at 46-47. Crist concluded that formal discovery provided the most effective means of enabling opposing parties to reach relevant information while simultaneously protecting the patient‘s privacy. Id. The presence of counsel and the possibility of judicial intervention helped to insure these results. Formal discovery also protects the treating physician from liability arising from improper disclosure of information in an ex parte conference. Id. The reasoning in Crist persuades us, as it did the district court.
We realize that our decision on the state law question is our prediction of what the Supreme Court of Arkansas will decide, and it is evident that when that court reaches these issues its decision will be the ultimate authority.
Finally, during oral argument, Lewis’ counsel asserted that affirming the district court would allow malpractice plaintiffs to use
We affirm the order of the district court.
BEAM, Circuit Judge, concurring specially.
I concur in Parts I, II, and III of the court‘s opinion and in the imposition of sanctions. I also concur in the affirmance of the district court‘s interpretation of
Our opinion notes that Judge H. Franklin Waters, United States District Judge for the Western District of Arkansas, has now construed
The court‘s opinion correctly points out that Judge Woods based his sanction order, in part, on his interpretation (and, presumably, Hall‘s purported misinterpretation) of
As shown by the good faith disagreement between eminent Judges of the Eastern and Western Districts of Arkansas, it is evident that Hall‘s interpretation is also tenable. In my view, then, it is wrong for a sanction to have been imposed on the basis of the privilege. If a lawyer is subject to sanctions simply because he has disagreed with a judge over the reading of a rule of evidence or procedure, the unwarranted chilling effect upon the adversarial process is obvious.
Notes
Rule 503(d)(3) provides as follows:
... There is no privilege under this rule as to medical records or communications relevant to an issue of the physical, mental or emotional condition of the patient in any proceeding in which he relies upon the condition as an element of his claim or defense ...; provided, however, a patient shall not be required, by order of court or otherwise, to authorize any communication with any physician or psychotherapist other than (A) the furnishing of medical records, and (B) communications in the context of formal discovery procedures....
Rule 35(c) provides as follows:
Medical Records. Where a party relies upon his physical, mental or emotional condition as an element of his claim or defense, he shall, upon the request of any other party, execute an authorization to allow such other party to obtain copies of his medical records; provided, however, a party shall not be required, by order of court or otherwise, to authorize any communication with his physician or psychotherapist other than (1) the furnishing of medical records, and (2) communications in the context of formal discovery procedures....
The district court continued, citing the reporter‘s note to the Rule:
[Subdivision (c) ] makes plain that a party may not be required to allow an adversary to communicate with the party‘s physician or psychotherapist outside the formal discovery process. This safeguard is deemed necessary to protect the confidential relationship between a party and his physician or psychotherapist.
Hall cites Zambrano v. City of Tustin, 885 F.2d 1473 (9th Cir.1989). While the Zambrano decision contains some language supporting a general extension of the bad faith requirement, the court is specifically reviewing a district court‘s imposition of sanctions in the form of attorneys’ fees, jury fees, and court expenses. Id. at 1475. The Zambrano case is also distinguishable by its extraordinary facts: The district court, in response to rather minor offenses (counsel‘s failing to stand while making objections and failing to file a formal application for admission to the district‘s bar), apparently threatened to have offending counsel shackled in leg irons and removed from the courtroom. Id.